Q. “China is using its economic relations and positive trade surplus as tools to develop potential military power status in Asia”. In the light of this statement, discuss its impact on India as her neighbour. (2017)

by Prince · 8 February 2024

The statement reflects the strategic use of economic prowess and trade surpluses by China to bolster its military capabilities and assert its status as a potential military power in Asia. This strategy is part of a broader geopolitical tactic known as “economic statecraft,” where a nation leverages its economic strength to achieve strategic military and diplomatic objectives. The implications of China’s actions on India, as a neighboring country, can be analyzed from multiple dimensions:

1. Strategic Security Concerns

Border Tensions: China’s military modernization and assertiveness have been a significant concern for India, especially along the disputed borders. The enhanced military capabilities of China, backed by its economic strength, have led to increased tensions in border areas, most notably in the Doklam plateau and the Galwan Valley.
Indian Ocean Region: China’s economic power has facilitated its naval expansion, part of its “String of Pearls” strategy, aimed at increasing its presence in the Indian Ocean. This poses a strategic challenge to India, which sees the Indian Ocean as its area of influence.

2. Economic Dependencies and Vulnerabilities

Trade Imbalances: A significant trade surplus with India allows China to exert economic influence. India’s heavy dependence on Chinese imports, particularly in critical sectors like electronics, pharmaceuticals, and machinery, can become a vulnerability in times of geopolitical tensions.
Investment Influence: Chinese investments in India’s technology and infrastructure sectors could be leveraged for strategic interests. While beneficial economically, these investments also pose a risk of undue influence on India’s internal matters.

3. Regional Influence and Alliances

Shifting Alliances: China’s economic and military rise has led to the formation of new regional alliances and partnerships that could isolate India. The China-Pakistan Economic Corridor (CPEC), part of China’s Belt and Road Initiative (BRI), is a glaring example, which bolsters Pakistan’s economy and military capabilities, indirectly affecting India.
Regional Dominance: China’s ambition to be the dominant power in Asia challenges India’s influence in the region. China’s economic tools have helped it to extend its influence in South Asia and the Indian Ocean, encircling India (“String of Pearls”) and diminishing its traditional sphere of influence.

4. Responses and Countermeasures

Strategic Partnerships: India has been bolstering its strategic partnerships with other countries to counterbalance China’s rise. The Quadrilateral Security Dialogue (Quad), involving the USA, India, Japan, and Australia, is a strategic countermeasure to ensure a free, open, and inclusive Indo-Pacific region.
Self-Reliance Initiatives: India’s push for “Atmanirbhar Bharat” (Self-Reliant India) aims at reducing dependency on Chinese imports by promoting domestic manufacturing.

5. Economic Diversification

Trade Diversification: India is working towards diversifying its trade partnerships to reduce its economic dependency on China. This involves enhancing trade relations with other countries and regions to ensure a more balanced and less vulnerable economic structure.

In conclusion, China’s use of its economic relations and trade surplus as tools to develop potential military power status in Asia presents significant challenges for India. These challenges span across strategic security concerns, economic dependencies, and regional influence. India’s response, through strategic partnerships, self-reliance initiatives, and economic diversification, aims to mitigate these challenges while safeguarding its national interests and regional influence.