Martin Jacques - When China Rules the World

China and India have much in common. They are both hugely populous countries, demographic superpowers, which are in the process of dramatic economic transformation. Between them they account for almost 40 per cent of the world’s population. They are both continental giants, China a dominating presence in East Asia and India similarly in South Asia. By the mid twenty-first century, they could both be major global powers. Together they threaten to redraw the shape of the world, tilting it massively towards Asia while at the same time projecting a new kind of nation-state of continental proportions in terms of both territory and population, a very different kind of global order from when the world was dominated by a handful of small- and medium-sized European nation-states. It is hardly surprising, then, that China and India are frequently bracketed together. Despite these similarities, however, in many respects the differences between them could hardly be greater, as symbolized by their long border running through the Himalayas, the greatest natural land barrier in the world, which serves to mark out what can only be described as a political and cultural chasm between the two countries. China has the longest continuous history of any country while India is a much more recent creation, only acquiring something like its present territory, or at least two-thirds of it, during the later period of the British Raj. [1119] [1119] Meghnad Desai, ‘India and China: An Essay in Comparative Political Economy’, seminar paper, Asia Research Centre, London School of Economics, 2003, p. 3; revised version available to download from www.imf.org. Chinese civilization is defined by its relationship to the state whereas India ’s is inseparable from its caste society. India is the world’s largest democracy while in China democracy remains a largely alien concept. China has a powerful sense of identity and homogeneity, in contrast to India, which is blessed with a remarkable pluralism embracing many different races, languages and religions. These cultural differences have served to create a sense of otherness and distance and an underlying lack of understanding and empathy. It is true that India gave China Buddhism, and that there were many other intellectual exchanges between the two countries during the first millennium and beyond, but these are now largely forgotten. [1120] [1120] Amartya Sen, The Argumentative Indian: Writings on Indian History, Culture and Identity (London: Allen Lane, 2005), pp. 161-90, especially p. 164.

For over fifty years relations between the two countries have been at best distant and suspicious, at worst antagonistic, even conflictual. After 1988 they took a turn somewhat for the better, but despite the warmer diplomatic words, there remains an underlying antipathy. There are two main causes. First, notwithstanding joint working groups and commissions, the two countries have failed to reach agreement on their border. And it was conflict over the border which led directly to the Sino-Indian War in 1962 when China inflicted a heavy military defeat on India which still rankles to this day. [1121] [1121] John W. Garver, Protracted Contest: Sino-Indian Rivalry in the Twentieth Century (Seattle: University of Washington Press, 2001), pp. 79–80. Second, far from exercising unchallenged hegemony in South Asia, India finds itself confronted by Pakistan, Bangladesh, Nepal and Myanmar, all of which China has deliberately befriended as a means of balancing against India, with these countries embracing China as a way of offsetting India ’s dominant position in South Asia. Of these relationships, the most important is that between China and India ’s sworn foe Pakistan, which, thanks largely to China, possesses nuclear weapons. China ’s shrewd diplomacy has meant that India has constantly been on the back foot in South Asia, unable to assert itself in the manner which its size would justify. India has proved much less diplomatically adept, failing to establish its hegemony over South Asia and not even trying to develop a serious influence in East Asia, notwithstanding the large Indian diaspora in South-East Asia, with which it has singularly failed to establish any meaningful kind of relationship. [1122] [1122] Ibid., pp. 370-73; Prasenjit Duara, ‘Visions of History, Trajectories of Power: China and India since De-colonisation’, in Anthony Reid and Zheng Yangwen, eds, Negotiating Asymmetry: China’s Place in Asia (Singapore: NUS Press, 2009), p. 6. Also, Bill Emmott, Rivals: How the Power Struggle between China, India and Japan Will Shape Our Next Decade (London: Allen Lane, 2008), pp. 50–51.

There are two possible outcomes in terms of their future relationship. First, China could accept that South Asia is, in effect, India ’s rightful sphere of influence. In practice, this seems rather unlikely. Chinese influence in the region is too extensive and too well established for it to be rolled back or for China to concede that this should happen. It is an outcome which both China and its formal and informal allies in the region would resist. Furthermore, given China ’s growing strength relative to India, it is probably less likely than at any time in the last half-century. Second, India could accept that China ’s presence in South Asia is permanent and resolve to accommodate itself to this reality by, for example, conceding that an Indian- Chinese partnership is necessary for handling security problems in the region. In the longer run, this could even mean that India acquiesces in China ’s pre-eminence in South Asia as well as in East Asia. [1123] [1123] Garver, Protracted Contest , p. 368. In this context, a major Chinese objective is to prevent the creation of any barriers which might impede the long-term growth of its presence, role and influence in Asia; other examples of this are its resistance to the widening of the US-Japan alliance and its refusal to accept any multilateral approaches or solutions to the sovereignty of the disputed islands in the South China Sea. [1124] [1124] Ibid., p. 374. The latter scenario — Indian acceptance of China ’s role in South Asia — would be consonant with this objective. In reality, of course, India has been obliged over many years to adapt — de facto at least — to the growing power of China in South Asia, so elements of this scenario already exist in tacit form. [1125] [1125] Ibid., p. 384.

China ’s rapid economic growth has underpinned its growing strength in South Asia. In 1950 the per capita income of India was around 40 per cent greater than that of China; by 1978 they were roughly on a par. By 1999, however, China ’s was not far short of being twice that of India ’s. [1126] [1126] Desai, ‘India and China’, pp. 2, 8, 10, 12; Martin Wolf, ‘On the Move: Asia’s Giants Take Different Routes in Pursuit of Economic Greatness’, Financial Times , 23 February 2005. Furthermore, although India ’s growth rate has steadily risen in recent years, it still remains significantly below that of China: in other words, China is continuing to extend its economic lead over India. Although India enjoys some economic advantages over China, notably its prowess in software, the software industry only accounts for a very small proportion of its labour force. Manufacturing accounted for a little over a fifth of India’s GDP in 2003 compared with over a half of China’s, while 59 per cent of India’s population was still employed in agriculture in 2001 compared with less than half in China. [1127] [1127] Simon Long, ‘India and China: The Tiger in Front’, survey, The Economist , 5 March 2005, p. 10; Shell, Shell Global Scenarios to 2025 , pp. 137-43; David Pilling, ‘India Hits Bottleneck on Way to Prosperity’, Financial Times , 24 September 2008. China ’s economy is now three times as large as that of India, [1128] [1128] Measured in terms of GDP exchange rates. It is over twice as large measured by GDP purchasing power parity; The Economist, The World in 2007 (London: 2006), pp. 106-7. with the gap extending. Even if India ’s growth rate overtakes that of China, it would take a very long time for the Indian economy to become as large as the Chinese. In short, China ’s economic power is likely to overshadow that of India at least in the medium term, if not much longer.