As Malone puts it: ‘Indian policy in South Asia has improved in tone and quality in recent years. But it is not yet such as to induce either awe or affection amongst those neighbours who matter. India cannot aspire to be a truly convincing “great power” until it achieves a better handle on its region without the support and active involvement of outsiders. Indeed, India faces a circular challenge: unless its region becomes more cooperative (and prosperous), India is unlikely to develop into more than a regional power, but it is true as well that it cannot be a global power unless it reaches beyond its neighbourhood.’
It is a truth that we in India hold to be self-evident that it is in India’s interest to be generous to its neighbours on the subcontinent (just as, as I have argued in the previous chapter, it is in India’s interest, as the stronger country, to offer generous gestures to Pakistan in order to improve the atmosphere within which peace and progress are to be sought). Perhaps the best metaphor for India’s most appropriate attitude to the countries on its periphery in this regard comes not from the soaring vision of Jawaharlal Nehru, whom I have often quoted, but from the more down-to-earth perspective of his successor as prime minister, the modest Lal Bahadur Shastri. Just as Nehru left Robert Frost’s immortal lines—‘Miles to go before I sleep’—on his bedside table when he died, Shastri kept some lines of the founder of the Sikh faith, Guru Nanak, on his desk. When translated into English they read: ‘O Nanak! Be tiny like the grass, for other plants will wither away, but grass will remain ever green.’ Shastri was seen by many Indians of exalted ambition as a tiny man, but he had the mind and heart of a giant. His vision of peaceful coexistence with our neighbours, through adopting the demeanour, the modesty and the freshness of grass, may well be the best way for India to ensure that its dreams remain evergreen in its own backyard. In this era of competing global powers seeking to influence South Asia in their own interests, India will do well if, like Shastri, it heeds Guru Nanak’s wisdom.
Chapter Four China and India: Competition, Cooperation or Conflict?
The rise of China and India in the world has become a cliché of contemporary political analysis. It is widely accepted that these are the two countries whose development is having and will have a significant impact on the global system, and on the world’s sense of where international economic and political power will shift in the decades to come. The question we must consider is whether the two countries will compete, cooperate or even enter into conflict.
Of course, both China and India are extraordinary success stories of recent years. Both have multiplied their per capita income levels many times over since 1950, and have done so far faster in recent years than Britain or the United States did during and after the Industrial Revolution. The idea that both China and India could triple their current economies in the next fifteen years is not implausible to most economists, not even to the World Bank, if their annual assessment of Global Economic Prospects is any guide. I am not an economist, but I have always been profoundly sceptical of those who issue forecasts of any sort; to me, the future is never quite what it used to be. But few will disagree that China and India are going to be richer than they are now, both in absolute terms and in relative ones. That is why it is meaningful to speak of an increasing shift of economic and, as a result, political power — and to ask how the two countries, which fought a short but brutal war just fifty years ago, will deal with each other in the process.
China and India are the two most populous countries in the world, with India set to overtake China’s population around 2025. They account for nearly a tenth of global GDP, a fifth of world exports and a sixth of all international capital flows. China and India are the world’s second and eleventh largest economies in dollar terms, though both rank higher in PPP terms. China holds by far the largest foreign currency reserves in the world, at some $3 trillion; half of that is held in US paper, and if it pulled its money out of the US Treasury it could in one stroke destroy the US economy (at some considerable cost to itself, of course, which is why this won’t happen, but it reflects how much the United States is dependent on it).
We can say with some confidence that India and China will continue to prosper and pull more millions out of poverty than they have ever done, that they will compete effectively with Western corporations for business, purchase foreign companies and assets, expand their trade and overseas investments, invent and develop new technologies and displace more economic weight around the world. As a result, they will inevitably demand more authority in the international system, and I believe they will acquire it. China will, in my view, be the country that strips the United States of its current designation of being the world’s ‘sole superpower’—perhaps within one generation. India will not stride the global stage to that extent, but it will be a significant player in its own region, and through the attraction of its soft power, be hugely influential well beyond its borders. Neither will be — nor has been for some time — a bit player on the global stage.
Both are also currently expanding their hard power. China’s military budget has been increasing by a staggering 17 to 18 per cent a year since 2007, rising to $106 billion in 2012. It has launched an unmanned space orbiter, announced a major expansion of its naval and submarine fleet, and conducted a test flight of a new stealth fighter aircraft, the J-20, on the very day (11 January 2011) that the US secretary of defence was calling on President Hu Jintao in Beijing. India is behind but it is heading in the same direction, expanding its defence and space capabilities. (Still, both countries together would have a long way to go before they can compete with the United States, whose defence budget is currently equal to that of the rest of the world put together.)
According to the experts at Goldman Sachs, China is likely to overtake the United States as the world’s largest economy by the late 2020s, with India closing in behind them. But let us remember that this would merely be a partial reversion to a historical state of affairs. The economic historian Angus Maddison has told us that back in 182 °China and India together accounted for half of the world’s total economic output — India 23 per cent of global GDP, China nearly 27 per cent. Neither is close to those numbers today, but even the most optimistic projections for their rise do not see these two countries accounting for 50 per cent of global GDP in the twenty-first century. So there may be a genuine shift of economic power, but it would not bring these two back to the position they occupied just two centuries ago.
To look at the recent rise of these two countries is, however, remarkably instructive. Those who visited China during Mao’s time would not recognize it today. It is a country that remade itself to a point that its visible physical infrastructure is almost entirely new: the extraordinary cities with their dense forest of skyscrapers, their six-lane expressways, studded with flyovers or overpasses, their gleaming modern airports, their large and throbbing ports, and the growing network of high-speed railways. The last is indicative of how significantly China has invested in its infrastructure: the high-speed rail network has gone from zero just six years ago to 8358 kilometres at the end of 2010, and is projected to reach 13,000 kilometres by 2012 and 16,000 kilometres by 2020. It also features trains of a speed and sophistication not widely seen elsewhere in the world. Similar projections about the expressway network, which has gone from zero in 1995 to 66,000 kilometres today, see 100,000 kilometres of six-lane roads by 2015 and 150,000 kilometres by 2020. (The joke used to be that the national bird of China must be the crane, since there were so many of them around the country.)