Modi’s China Visit: A View From Australia

India's Prime Minister, Narendra Modi, and his Australian counterpart Tony Abbott in New Delhi in September 2014. Credit: Wikimedia Commons

India’s Prime Minister, Narendra Modi, and his Australian counterpart Tony Abbott in New Delhi in September 2014. Credit: Wikimedia Commons

Prime Minister Narendra Modi’s visit to Beijing promises to be his most difficult foreign visit so far. He will be doing a delicate dance between expectations that he will bring home billion dollar investment projects while also making it clear to his hosts that China needs to pay more regard to India’s strategic sensitivities.

Modi seems to have a talent for not letting historical baggage (both personal and national) get in the way of the business of doing deals.  That is a good thing, especially in light of President Xi’s failed visit to Delhi last year.

Chinese incursions into India

Then President Xi came with what he claimed to be a bag full of money to woo India to signing up to China’s grand projects, including the Maritime Silk Route and the so-called BCIM Economic Corridor project.  Simultaneously Beijing (or at least someone in Beijing) choreographed an incursion of a PLA battalion over the Line of Actual Control in the Himalayas and a surprise visit of a Chinese submarine to the new Chinese-built port in Colombo.

It is still not clear what those incidents were all about, but neither of the most likely explanations is particularly reassuring.  One is that these incidents occurred with President Xi’s approval – presumably in an effort to put India in its place and demonstrate that China can do whatever it wants in South Asia. The other explanation is that they occurred without his approval, which may be an even greater worry. In any event, Prime Minister Modi did the best thing possible in the circumstances: he allowed the visit to go ahead but made it clear that there would be no major deals on the table at that time. It was a psychological victory for him of sorts.

When Modi goes to Beijing this week, it is almost inconceivable that President Xi will allow another stunt of a similar nature to occur. But Modi will nevertheless be walking a delicate line. Beijing seems to have decided that not only does money talk in international affairs, but also that ultimately only money matters.  This view of the world has several consequences.

The first is the belief that recipients of Chinese investments will do whatever it takes. President Xi is just back from Islamabad where the Pakistanis could not fall over themselves enough over China’s promises to invest $46 billion in an economic corridor to Gwadar.  (How much of that number will actually materialise is an interesting question.)  The Chinese will not be expecting the same reaction from Modi, but they may well expect him to overcome his fears about China’s strategic intentions in the Indian Ocean region and get on board the (Chinese) train, so to speak.

Modi no doubt feels bound to bring back a bunch of infrastructure deliverables, but presumably he will be trying to channel investments away from strategically sensitive areas.   That may well be the proof of the pudding.  If China is happy to make investments in India in ways that do not have strategic advantages or implications, then it may provide a template for a much more co-operative relationship.

Money trumps everything

A second consequence of the view that only money matters in the world may be that India and others in the region have greater freedom to move in terms of their own security.  China appears to be more relaxed now than in previous years about its economic partners forming security relations that do not include China, and even to some extent are intended to balance China’s growing power.

A good example of this occurred in Canberra last November. On one day President Xi addressed Australian Parliament, announcing the conclusion of a ground-breaking free trade agreement between China and Australia – which included giving unprecedented access to China’s agricultural markets.   On the very next day, the Indian Prime Minister addressed the Australian Parliament and announced a new Security Framework between India and Australia that signaled a much closer defence and security partnership between them.   Beijing seemed entirely unfazed by Australia’s closer security relations with India.  This is in considerable contrast to previous years when we would have heard much huffing and puffing about it from Beijing.

One conclusion of this episode is that Beijing has taken a pragmatic view that ultimately only money matters – that it will not object to countries like Australia and India taking reasonable steps to give themselves greater reassurance on security, because their economic relationship with China will ultimately trump everything else.   Maybe China is right about this, but maybe it is wrong.

Dr. David Brewster is a Distinguished Research Fellow with the Australia India Institute, University of Melbourne.   He has written extensively on Indian Ocean security and India’s security relationships in the Indo-Pacific.  His most recent book is India’s Ocean: the Story of India’s Bid for Regional Leadership. Read more.