As India and China mark 70 years of diplomatic ties, Srinath Raghavan speaks to Shivshankar Menon about the shared history, culture, and future of the bilateral relationship between the two neighbors.
As India and China mark 70 years of diplomatic ties, Srinath Raghavan speaks to Shivshankar Menon about the shared history, culture, and future of the bilateral relationship between the two neighbors.
Shivshankar Menon was a distinguished fellow with Brookings India, and is currently a distinguished fellow with the Centre for Social and Economic Progress.
Srinath Raghavan is a nonresident senior fellow at Carnegie India. He is also a professor of International Relations and History at Ashoka University. His primary research focus is on the contemporary and historical aspects of India’s foreign and security policies. He has written a number of books spanning international relations, strategic studies and modern South Asian history.
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(Intro) Srinath Raghavan: Hello and welcome to interpreting India. I'm Srinath Raghavan and this is the podcast presented by Carnegie India. Every two weeks we bring to you voices from India and around the world as we unpack the role of technology, the economy and foreign policy in shaping India's relationship with the world.
On 1st October, 1949, Mao Zedong proclaimed the founding of the People's Republic of China. Over the following decades, the emergence of the People's Republic proved to be one of the pivotal events of the 20th century. The rise of China as a great power is as likely to shape our own century in important ways. Over this period, India's relationship with China has acquired a degree of salience and substance that perhaps could not have been foreseen when India moved to recognize the PRC 70 years ago. To discuss the past, the present and the likely futures of China's relationship with India, we have here with us Ambassador Shivshankar Menon. Ambassador Menon is a distinguished fellow at Brookings India. His long career in public service spans diplomacy, national security, atomic energy, disarmament policy, as well as India's relations with its neighbors and major global powers. He has served as the National Security Advisor to the Prime Minister of India from 2010 to 2014. Previously, he was Foreign Secretary of India from 2006 to 2009 and has served as Ambassador and High Commissioner of India to Israel, Sri Lanka, China and Pakistan. Ambassador Menon is the author of a book, 'Choices: inside the making of Indian foreign policy' published by Brookings Press and Penguin Random House India in 2016. Ambassador Shivshankar Menon, welcome to Interpreting India.
Shivshankar Menon:Thank you.
Srinath Raghavan: Let me start by talking a little bit about the background to India's recognition of the People's Republic of China. We know that India was one of the first non-socialist countries to recognize the PRC, but it seems to me that even for India it was something of a surprising decision. Because you know, if you look at India's relationship with the nationalist Chinese government with Chiang Kai-shek, that goes back effectively to the mid 1930s at least. Jawaharlal Nehru visits China, there is a correspondence between him and Chiang Kai-shek and Madam Chiang Kai-shek. Chiang Kai-shek even comes to India during the Second World War, trying to persuade the Indian nationalists to throw in their lot with the British war effort and so on. And it's only after the war ends that the civil war effectively resumes in China. And then India makes this very sudden decision of recognizing the communist Chinese as the government China at a time when they've had longstanding relations with the nationalists. So I just wanted to get a sense of how this rather important turnaround happens in Indian foreign policy at a time when India is finding its own feet really in the international stage.
Shivshankar Menon: I think it's really a result of two big factors, and both Nehru and Patel were actually convinced, I think at the time of that a) that China was important and to that extent it's not a turnaround. After all, when the government of India and the British government of India opened missions abroad, opened Indian missions abroad during the war in '41-'42, one of the first four missions was actually in China to the Guomindang. But it was a mission to China and the Agent General was in Chunking right through the war. And thereafter we had an ambassador accredited to Chiang Kai-shek's regime. But since China was important and the relationship was with China, when the government changed in China, when the communists were in effective control, it made sense to recognize them and to deal with them. So, it was this awareness that China was our biggest neighbor, was close to us, and the feeling also that this was a very new China. That this was a China which had at various times Mao Zedong had spoken in the mid-thirties, for instance, of China's five fingers, which included parts of Nepal, Sikkim, and so on, that we were dealing with a China which was now militarized, which had declared its intention to move into Tibet and did so very quickly, that this was now on our borders and this was a fact of life. That was one part where China's significance, China's importance, and that to ignore this and to not recognize them I think would not have been very sensible policy or at least not practical and rational policy. It might've made certain ideological elements happy. But interesting that at the same time that we're fighting Telangana, the communists in Telangana, we are improving relations with Stalin, we're recognizing the People's Republic of China. Remember it's all the same time. So, in a sense you're also driven by domestic considerations. You're building a non-communist country here, you're fighting a communist rebellion, but you're also making up with the others and this.
Srinath Raghavan: So in a sense that sort of takes the winds out of the sails of the Communist Party of India
Shivshankar Menon: And prevents at least external support to the extent possible. But it's also part of the larger awareness that de-colonization is, and for Nehru certainly, for him this is the most significant shift in international relations. And I think he's right, finally Asia is a part of the international state system. Sovereign states running their own internal affairs, maybe weak, maybe underdeveloped, poor, but finally we're part of the global, it's one global state system. Whereas we're no longer part of empires, we're no longer subjugated or half colonies like, as China was where large parts of it were controlled by other countries. She had lost her sovereignty, didn't have control over her own customs, half the country was under the Japanese etc. So, it was part of this revolution that in international affairs, that Nehru saw and saw decolonization as part of it. And he saw that as very important, particularly because we were entering a cold war, a bipolar cold war, and he didn't want to have to make those choices. So, he was looking around for other sources of support in the international system to create what he used to call the area of peace, to try and expand that. To have more countries who would work with him on these causes. And the Chinese of course, I mean the Chinese communists when they came to power, came with the same rhetoric of liberation, of freedom of, you know, no more imperialism, no more colonialism and the area of peace as well. Even from a purely practical point of view, I think you should recognize reality on your borders. You know, and you have to deal with it. Now you can choose to deal with it by ignoring it. I don't think that's very sensible policy when your means are limited.
Srinath Raghavan: You had earlier on spoken about Tibet, and as you said, they were early indications available to India about what the, any Chinese government would really think about Tibet. And I emphasize any Chinese government because already by early 1947, we knew that even the nationalist government was trying to get India to recognize Tibet as a part of China. Even before India formally becomes independent, there are negotiations that the nationalist government of China wants to have with India for a new Treaty of Commerce, Friendship and Navigation as part of which they also want to settle all boundaries and including recognition of Tibet by India, which at that point of time the foreign security K.P.S Menon, who was also previously our ambassador at Nanking, actually says that, you know, we should not rush into this because the civil war is not as clear. But nevertheless, when the 1950, come 1950 when the Chinese move into Tibet, there seems to be a bit of a divide between the Indian government on how exactly they should be responding to the situation.
Shivshankar Menon: But in '48, K.P.S. also did something else by the way. We also initiated, we initiated, contacts with the Tibetans. We sent Major Bakshi into Tibet three times to make an appreciation of the situation and to tell us what, the Tibetans were very divided among themselves. Within the Kashag itself, there were only two out of the five who felt that, you know, Tibet should assert its sovereignty and its independence, etc. And should seek support outside, including from India, but from the U.S. and the others. The rest of the Kashag the Dalai Lama was a minor, 16 years old, there was, at that time at least, there was nobody else who, and the Tibetan leadership was very divided. And they didn't have the capacity, clearly, if it didn't matter whether the nationalists or the Communists were in control of China once Japan was defeated, clearly whichever government came to power was going to try and take over Tibet. So, I think that conclusion had been clear for a long time. We looked at all the options and we, I think at that stage decided how, how to deal with it. Now, to have settled the boundaries with the Guomindang government, frankly, when they were nowhere near the boundaries, it really didn't make much sense.
Subsequently, once the Chinese Communist Party took control and the PRC was founded and they actually were on our borders, then I think one can question the wisdom of not actually making sure that you had an arrangement on the ground, but also some common understanding of the boundaries.
Srinath Raghavan: But it seems to me that at that point the boundary issue was not really front and center.
Shivshankar Menon: Not at all. In fact, the issues were quite different at that time. And Tibet at that time was still very dependent on India for supplies of everything; for grain, for you know, for food, we used to get rock salt out of Tibet, but for the most of the other things, Tibet used to depend on India, and even supplies to the Chinese troops who occupied Tibet in 1950 were sent through Calcutta Port by the Chinese government. It was their easiest way of communicating. So it's, no, I think the issues in Tibet were quite different at that time. And there was also this problem that I think nobody here at that time wanted Tibet to become a frontline issue in the Cold War. You had the example of what was happening in Korea. You didn't want a similar kind of thing in Tibet. Now, luckily, logistics, geography, etc. etc., prevented that actually happening. But it was a real fear. And frankly, later in the 50s and through the 60s until, you know, Nixon visited China, Tibet was upon in the Cold War. It was a weapon used by the West against China.
Srinath Raghavan: And the other thing which seemed to preoccupy the Indian government in the early 1950s when it came to China was really this desire to establish a very different kind of relationship between these two newly created Asian states effectively. And you know, there was a sense that Asia needed to find its own feet in the aftermath of the Second World War. And as you said, try and avoid being drawn into the Cold War, but Korean War made that difficult. But nevertheless, within the sort of realms of what reality was there was an attempt on the part, I think not just of the Indian government under Jawaharlal Nehru, but even the Chinese government to try and create some kind of a modus vivendi with India.
Shivshankar Menon: Yeah. I think on both sides this was a learning experience and it was a work in progress. Yes, both sides wanted a different kind of, because frankly we hadn't had a relationship for all, we'd been under, you know, British rule and the Chinese had other preoccupations right through the early 20th century, mainly internal. They were divided, they were broken up, etc. So, yes, both wanted a good relationship, but when you look at the internal documentation, whether it's ours or the Chinese. There was always a mixture of sort of, I'd say partly ignorance about each other, but also some suspicion always of the motives. Right through the fifties and sixties.
Srinath Raghavan: Yeah. And particularly, it seems to me that the 1962 war you know, tends to color our entire reading of the period before in one particular shade.
Shivshankar Menon: It all becomes a lead up to the war and everything seems to be somehow leading up to it. For me the year that really mattered was 1959, when Tibet exploded, Dalai Lama came here, they were confirmed and all their beliefs that, you know, India was trying to split Tibet, but from our point of view, Indian public opinion, parliament, political parties, the media, everyone was convinced that, you know, this was an aggressive expansionist China. And for the first time Zhou Enlai declared in public the extent of China's claims on us in January that year. And if you go through that year, January declares the claims, March Dalai Lama escapes, comes to India, you get floods of Tibetan refugees coming across with stories of atrocities and so on. And you know, for the average Indian here, peaceful Buddhist monks and so on being beaten up and chased and shot. And then of course, as the dispute widens, you start seeing other kinds of problems you have. You've had trouble in Bara Hoti, you now start getting for the first time you actually get Chinese presence in areas that you have considered on your side for a very long time and it just expands. You also have a situation where, well on the military side for instance, where you have differing assessments within India on what you should be doing, how you should deal with these things, none of which is actually resolved. So, it actually leaves the public very worried and unsettled at the end of it. Finally, the General quits, but that's not a satisfactory resolution. So, for me, '59 is really the turning point. After that, it becomes very difficult to negotiate a settlement out of it.
Srinath Raghavan: And the other sort of important thing which happens in 1959 are the two sort of clashes along the border, which leave Indian soldiers dead.
Shivshankar Menon: They return the bodies on Nehru's birthday, which is like a, you know, it's like a slap in the face. I mean it's, I'm sure they knew what they were doing. It's quite a story actually when you look at it.
Srinath Raghavan: Yeah. And that seems to have made any kind of attempt at reaching a rational settlement on the border, whether it was in 1960 or perhaps even in 1961 there was a moment when the secretary general of the MEA was sort of transiting through China, R.K. Nehru and had a fairly frank core set of conversations with the top Chinese leadership. But, nothing ever really seems to have come out of all of that.
Shivshankar Menon: But there, I think by then I think it was too late because by then we were trapped in China's domestic politics. Mao had lost power after the, I mean he'd even lost the chairmanship of the state after the great leap forward in the disaster losing, you know, 30, 40 million people died in the famine and other Liu Shaoqi and others had actually taken back control of domestic policy and foreign policy now became Mao's tool to get power back. He used foreign policy and the radicalization of foreign policy to actually gain power back. So I think by then it was, even though there might've been elements on both sides who thought this didn't make sense, but I think it was probably too late by then. But that's just my judgment.
Srinath Raghavan: And there is also the context of the Sino-Soviet sort of competition, friendship turning into rivalry, in which India is almost quietly in the middle of it, right?
Shivshankar Menon: You know, it's interesting because at that time there was a big debate internally in India, in the MEA. Does Sino-Soviet split, does it work for us or against us? Will it make China more reasonable? Because after all, they have other people, other fish to fry. It's a mirror of the debate we should be having today about what the Sino-U.S. differences today mean for India-China relations or India-U.S. relations. For the U.S. I think the U.S. says, honestly, she needs partners, but does China therefore moderate her behavior to us? Is that what Wuhan was? Is that what we're going to see in October? It's an interesting situation. Actually, there are parallels in many ways.
Srinath Raghavan: We'll come back to that towards the end. And I wanted to sort of move ahead a little bit beyond the war. You know, the war is a lot talked about, agonized over in India, but what strikes me as somewhat curious is why does it take so long for India and China really to pick up the pieces in a diplomatic sense after the war? Because, you know, our ambassador to China finishes his term in 1961, G. Parthasarathy, we do not appoint another ambassador till 1975. ‘76, sorry. KR Narayanan is sent as ambassador in 1976. So, what explains this long gap? I mean it's, is it just the psychological impact of the war? Are there other things in play?
Shivshankar Menon: I think there's, there are other things in play. I mean, if you look at the 60s, these were in terms of domestic politics. These were really turbulent decade for both of us. Great proletarian cultural revolution in China, for us Mrs. Gandhi has come into power after the war with Pakistan, '65 split in the Congress party, etc. '71, But more than that, why was the war fought? China started the war because she thought we were actually doing something to loosen her grip on Tibet. And there was a real chance in '59-'60 that she would lose Tibet to the Guerillas, to the Tibetans, if the rest of the world had moved in. I think all those kinds of fears were very strong and what she saw after India, Eisenhower, and certainly under the Kennedy administration, what they were doing to improve relations with India, and the Chinese saw this as part of containing China. So, for the Chinese, once they had won the war, and they won decisively, we were not on their border in a physical presence on the line. We were now actually; we had been pushed back. It took us a while to actually move back up all the way to the line. Same on the Chinese side. Chinese announced immediately a 20 Kilometer withdrawal from the line of actual control and said they would stay 20 kilometers away. And it wasn't until 1975 that they actually came and told us that no, we are now going to patrol up to the line. So, they were quite happy leaving a demilitarized sort of zone which left them free, which in a sense isolated Tibet and their problem they could handle on their side, which is.
Srinath Raghavan: Makes sense from their perspective
Shivshankar Menon: From their point of view, it makes sense. Not very happy from the Tibetan point of view and it was porous, frankly, because we had refugees coming in right through the sixties, seventies, eighties. In fact, young Tibetans used to come and study in schools in India because this was the only place you could get a traditional Tibetan education and then go back. So, it, you know, but their immediate goal had been met and they did, over time through the cultural revolution and thereafter, pacify Tibet and increase their control, built the roads, built the capacity, actually changed the population balance as well. So, the primary motive seems to have been served immediately after. It's only when China started going out into the world again, when she tried to recover from the cultural revolution, when after the opening to the U.S. for instance, when then it became important for her to start looking at her periphery and when she faced a real threat, she thought, in '69 she thought the Soviets were about to attack her, and this was a very real fear that she started reaching out and trying to build relationships and that there was actual capacity on the Chinese side. We had tried, Mrs. Gandhi, Mrs. Indira Gandhi had actually tried several times to say we're ready to talk without any preconditions. Said in 1970. She said it again after that, but until 76, they weren't really ready. And we finally, it was, and of course the ostensible reason was Chinese kept saying, you would draw your ambassador first so you send one back and then we will see what we do. The moment they stopped saying we'll see what we'll do and started saying yes and then we'd probably send an ambassador, we said fine. And we did.
Srinath Raghavan: And in your book, Choices, you mentioned that 1975 or thereabouts is the time when India also really establishes, the government of India establishes the China Study Group, which is an attempt to sort of start formulating policies towards the border, towards China.
Shivshankar Menon: That's because we were both for the first time now, and our patrols were running into each other, ’75 Tulung-La for instance somebody died in the fog, got shot by mistake, and that was the last death we’ve had on that border. And I think Mr. Vajpayee must be given credit for having shown the courage to go to China as Foreign Minister. First Foreign Minister to ever visit, even though Nehru was Foreign Minister and Prime Minister
Srinath Raghavan: But that was in 1954.
Shivshankar Menon: ’54, but I mean, he was the first ever, and he showed courage to go and actually talk to them and to discuss the hard issues, not just to say, oh, we want good relations and induct the issues. And that was where Deng first indicated that, you know, at least we were ready to maintain the peace, build on the status quo. More important, stop helping insurgence in India, especially in the northeast. And that China was ready to discuss all the other issues. And that's when we started that process. We started to officials, talks, visits, started both ways. And it was, it was an interesting period
Srinath Raghavan: And we have several rounds of talks between 1980 and 1986. Now I want to a) ask you about what exactly those talks managed to accomplish. But it seems that towards the end of that very process there was a kind of a new emphasis in China's territorial claims and they started talking a lot more about Arunachal Pradesh, as we've called about the Eastern sector and seeing that in some ways that is the key to unlocking everything else. And that has more or less remained consistent since 1986.
Shivshankar Menon: See Deng was the last Chinese leader to say privately and publicly that you know, if you accommodate us in the West, we'll accommodate you in the East. In other words, you keep your idea of the McMahon line, call it some other name, but we'll, you know, you accommodate what are the Karakoram boundary that China believes and not the Kunlun boundary in the western sector. He said it in public, it never came into the official talks. At no stage the Chinese make any such offer in the officials’ talks, which started in 1982. Deng said it in '81-'82 in public. And the Chinese hardened, I think the real hardening was '85 when they said Tawang is essential in the eastern sector, which was claiming populated territory, which had sent a representative to the Indian parliament for years before that. This was, you know, and that then translated next and the official talks to a statement that you must make concessions in the East and then we'll see what we do in the West, which of course is unacceptable, because it's like saying I've taken what I want in the West, but now you'll give me some more if you want to, and that's what it sounds like to Indians. So that hasn't worked. So, what we did, therefore, I think, and the lesson both sides learned from this was that politically it was very difficult to arrive at a complete boundary settlement. We tried and I think Rajiv Gandhi certainly tried very hard during his visit in 1988 but we therefore concentrated, and in 1993 we did the border peace and tranquility agreement, which basically says, we'll both respect the LAC, the status quo, we won't change it by force, we'll put in place measures to actually maintain it and keep the peace. So, we do CBMs and so on. And we'll keep discussing the boundary, the settlement in the meantime. Now in the discussion, and that has gone through various levels, we've tried various ways. It seems to me that we know each other's positions. We know what the position on the ground is also much better than say the predecessors who did this in 1960, '61 did. We also now have capabilities not just of surveillance and knowing what's happening, but also physical capabilities on the border. The working balance, I mean, the usable balance on the boundary is what has kept the peace actually. Whether it's on ours or theirs, and both of us have steadily improved our capabilities on the border. So, we don't have a boundary. We don't have a line that we agree, but we have an agreement on maintaining the status quo and the border, which is the zone really where we interact. And that seems to have held both sides needed.
Both sides don't see the point of changing this. So actually, nothing has changed on the ground when people, you know, you see a lot of publicity about incursions and this and that. I mean, from their point of view, what we do is incursions, you know because they think it's their territory. We think it's our territory. Therefore, Chinese presence is an incursion. But basically, we've maintained the status quo and we have a pattern of overlapping patrolling in areas which both sides think is on their side of the line. But it's peaceful. It's our most peaceful border. So, we did the border peace and tranquility agreement and that has held, and we've done a whole series of CBMs ever since based primarily on that agreement. I personally think we've worked that process as far as we can and that it's time to move on and to look for bigger and better things. But I don't know. I mean, I'm not part of this for the last five years, so it's really up to government to do this.
Srinath Raghavan: The one other thing that at least two governments of India seem to have tried out, the first is the NDA government under Prime Minister of Vajpayee. And then the NDA government under Prime Minister Modi in his first term was to try and work towards something like a clarification of the Line of Actual Control.
Shivshankar Menon: We started in Mr. Narasimha Rao's government and it's provided for both implicitly in the 1993 BPTA and explicitly in the 1996 Military CBMs agreement. And we did that, we started that exercise. Vijay Gokhale, who is now foreign secretary, was one of the people who was involved in actually doing that. We had agreed we'd exchange maps of where we thought the LAC lay and we did so for the middle sector, but when we came to the western sector, I think both sides felt the other side had exaggerated their claims in terms of where the LAC lay. And after that, the Chinese backed off. Their ostensible reason was that, oh, this will only fix the status quo, and status quo is not acceptable as a settlement so that's not our job and we shouldn't do that. But basically, I think what they realized was that they, by accepting our maps, they were also in a sense accepting all the differences that we were stating. And I think you see as long as both sides think that the situation on that border is going to be better from their point of view, relatively in the future, as time passes, that they are going to be stronger, that they will be better off. Neither side has an interest actually in fixing it very clearly right now. Why not do it when you're better off. So, in a sense, this confidence in both sides have that the future is mine, keeps the peace today, but it also leaves it unsettled and open for the future. It works both ways.
Srinath Raghavan: That's an interesting thought. And do you think you would extend the same argument to cover the 2005 political parameters agreement where they seem to be sort of significant sort of commonalities which are arrived at, but nevertheless, points of interpretation are still tended to differ, especially about settled populations. How do we treat them?
Shivshankar Menon: Ultimately if there is a settlement, it has to be a political decision on both sides, and it has to suit both sides' political interests. Whether the clause says this, means that, diplomats love doing this, and this keeps them busy and keeps them employed. But frankly it's not going to, that's not what's going to lead to or prevent the settlement if it's in both sides political interest at the same time. The trouble is that any settlement has to be for, for either side, it has to be some give some take. You can’t get what you show today as your boundaries on your maps. Chinese can't get what they show. We can’t get. If we are to settle and get both sides to agree. So, by definition it can be presented both as a gain, that you oh, you've settled a boundary, but has a loss that you've lost territory, which was ours. You may never have occupied it or may never had anything to do with, but it's our territory. And to ask people to change the shape of your country's map, which you learn to draw in school. That's quite a big ask for a politician. So, it seems to me that that's only likely to happen when it's part of something much bigger, when there are other gains that you can quote to offset this notional loss of territory that any settlement would involve on both sides. And whether that timing works, both have to want it at the same time, and whether that happens, that is very hard to predict. It doesn't exist today yet.
Srinath Raghavan: And that seems to be broadly the pattern of China's territorial settlements in the past when it has suited some larger geo-strategic interests.
Shivshankar Menon: You have to look at the bigger context, you have to look at their domestic situation. You have to look at what, and I think that's, that's really, now you could argue that everything has shifted now, that we're in a new geopolitical age, right? China-U.S. contention is primary drive of what happens in Asia. You could actually, there's a whole series of reasons why that domestic transformations are very important today. Both are adjusting to the new world economy. China is trying to make the transition to being a maritime power, which is critical. More than half our GDP depends on the external sector. So, and the same thing is true of us. So you could argue that this is a good time to actually look at it afresh from first principles and see whether there's some scope to do something more than what we've done so far, which is fundamentally just managing the problem and managing the relationship and then keeping it basically positive, but you know, not addressing the hard issues or settling those.
Srinath Raghavan: So I want to come back to a point which you made at the beginning of the podcast, which is about whether this moment in U.S.-China relationship represents an opportunity or a challenge or possibly some combination of both as far as India is concerned. Now the Indian government has attempted since the Doklam standoff to reach out to the Chinese government. They have reciprocated. There is a so-called Wuhan spirit, which apparently reigns currently. And there is an expectation that President Xi Jinping might come to India later in the year. How do you see India's options in the current context? And are we playing the cards the best way that we can?
Shivshankar Menon: The simplest way, I mean that basic what, define your own interests, see what works for you. I've always felt that nobody shares your interests entirely or even to a very great extent. There is other country quite like you, at your level of development yet with some power and considerable influence and an ability to, you know, and a geographical location which really works wonders for you if you choose to use it. There are, it's very hard to think of any other countries of your scale, your influence, etc., but they don't share your interests. So, for me, it's natural that you would run your own policy, that you would look at each issue separately, and you would then look for partners to work with because you can't do everything yourself. You don't have that much power. Nobody can actually. And you look for separate partners and work with whoever's ready to work with you on those issues. And therefore, I say this is for us, it should be the era of issue-based coalitions of the willing. It doesn't have to be the same countries all the time. It won't be because different countries will have different interests. But I think that's what we should be doing right now. You can give it any label you want, call it strategic autonomy, call it whatever, non-alignment 2.0, whatever the label. But for me the label is less important than the actual clarity on the process of building a hierarchy of interests, which ones matter most, which lessons on and working the issues related to them by building coalitions of the willing. So it's actually a time when you need much more diplomacy, much more work, and much more capability building in your own system and certainly on the issues that matter.
Srinath Raghavan: And where do you think are the areas of convergence or opportunities to work as far as China is considered?
Shivshankar Menon: With China I think there is a clear economic convergence of interests. There is a capacity there which we can use to build our infrastructure to do various things. We have to negotiate the terms better. We need to do that because we can't run a deficit the way we've been running it so far. That we need to do, and that we can do by broadening the economic relationship rather than by cutting it down. So far, it's purely a trading relationship. In the last five years, the Chinese have invested considerably in India. That makes a big difference. And if there's Chinese manufacturing in India or creating jobs for Indians, and producing in India, and exports out of India, I think it works for us. That that kind of thing would make it easier and also make it easier to deal with the deficit. I saw one estimate that even though official figures for Chinese investment in the last six years, I think are around 1.8-2 billion dollars, that the actual flow through various other places, Malaysia, Singapore, etc., is somewhere in the region of $16 billion, which is sizable. And that's, and that's a big shift. That's one area where I think. The other area where I don't think we have any choice but to work together is a whole set of transnational issues, climate change, et Cetera, new and renewable energy, where we both have very similar interests, and where we need shape an international response because these are not issues that either of us or anybody else can settle or solve on their own. And I think that's something we should be doing. We have been doing in the past. We have a history of doing that. Hardest issue to address though is issues like RCEP, opening up of the economy to each other, and there I think you need to have a much more strategic view if you allow one or two industries to hold the rest of the country hostage. Clearly, obviously the Chinese will have comparative advantage in some industries, but you need to set the terms and then build up your own capability to actually go out and compete. And I think you can negotiate the terms. But buy yourself some time, do it. The Chinese have used international economic negotiations in order to do the reforms at home that are unpopular or difficult to do. When they did WTO for instance,Zhu Rongjiactually used that negotiation. So, it's, it's what the Japanese used to do. It's called Gaiatsu; foreign pressure. You use foreign pressure to make the changes at home which do you good. And I think we should do the same with our RCEP and so on. But these are big issues, these are very big policy issues.
Srinath Raghavan: Well, I suppose for that we need to have a better handle on what exactly is happening at home and see.
Shivshankar Menon: You need clarity on what matters. You shouldn't waste your time doing things that don't matter. I mean, listing Masood Azhar is a waste of time. And to use your diplomatic clout for that, frankly, I mean, Hafiz Saeed has been listed what, 20 years? what's happened to him?
Srinath Raghavan: One of the things of Chinese seem to want from India at this point is some kind of political acknowledgement of the Belt and Road, which they see as the sort of flagship initiatives. And I think it rankles then that India has stood out so vocally and that some of the positions espoused by India had actually been adopted by others. And there is this infamous terminology of debt-trap diplomacy which has its origins, apparently, in Indian discourse.
Shivshankar Menon: I'm less worried about what the Chinese think about our attitude to Belt and Road, than you know, when I talked to the victims of the debt trap. For them, we are insulting them every time we say debt trap, it's like saying you are fools. You don't know what you're doing. You know, that's not very good diplomacy. I think the basic point we're making is right, that there should be transparency that, you know, you shouldn't get in over your head. But some of the so-called victims, their attitude is if you owed the bank enough money, you own the bank. And Deng Xiaoping was asked in 1981 when foreigners were building hotels in the heart of Peking on Chang ‘an, near Tiananmen, aren't you worried? All these foreigners in the heart of your capital. And he said, what are they going to do? Pick it up and walk away? So, there is you know, I think there's a level of sort of, we need to be very clear. There are things like CPEC, Chinese projects in Pakistan Occupied Kashmir and so on, which clearly are unacceptable from our point of view and we need to oppose those, and those that affect us strategically. If Gwadar becomes a military port, for instance, these are things that we need to oppose every which way possible because our interests are involved. Other things, if they build a port, which we can use, let them put the money and the effort in and we get to use it, we should use it, if it's in our interest. And the example I always use is Colombo and Hambantota. Colombo port, the last two expansions were done with Chinese money, Chinese labor, Chinese effort. 83% of what goes through that port is to or from India. It's actually doing our work because our ports are inefficient. So, we send things all the way down both coasts, collect them in Colombo and ship to the rest of the world. We're happy. We get the use of a port, the Sri Lankans are happy, the port is paying back, whatever debts it has, because there's traffic, Chinese have made money. Hambantota, they spent $1.8 billion and there's no ships going through, it's empty it's not making money, they had to convert the debt into equity. Now I think 99-year lease and they have to add an industrial zone to try and make it profitable. Good luck to them. But it's a dud. Whether it's owned by the Sri Lankans and not paying its debt or owned by the Chinese in terms of equity and unable to make money or leased to the Chinese. All that is, you know, secondary. Ultimately, it's a dud. It's not going to make money for whoever it is. So, I think we also need to be a little more rational about where we, how we deal with it. And if you notice the last two years, we've stopped insulting everybody by saying you're fools to take BRI money. We've now, I think toned down the rhetoric. Frankly, I think we should deal with the practical consequences of what is going on, which is a fundamental change in the operating environment for us. If they do even 50% of what they say they're going to do it’s a huge change.
Srinath Raghavan: So when you look back at the last 70 years, which we've covered in in the last half an hour or so does it strike you that China and India have it in them to be able to navigate the challenges that the second decade of the 21st century poses, which in some ways might sound similar to that of the Cold War, but as you pointed out in your writings, they are not, the degree of interdependence between the United States in China is far heavier. The global economy is woven together in very different ways. The diffusion of power is also quite different, and India's own standing is quite different today than what it was 70 years ago. But do you think that means we are better positioned to navigate these challenges, both India and China? Or does it mean that the possibilities of the two coming towards some kind of friction and rubbing into each other also remains high?
Shivshankar Menon: Power and wisdom don't necessarily go together. It's an interesting problem actually in history if you look at it. It seems to me theoretically there is no reason why two countries with what a combined 8,000 years of statecraft between them don't have the ability to manage their relationship, manage this kind of world that we see, this new globalized, interdependent world where missile ranges are, you know, may really knit it all together into one geopolitical space. Why not? They should be able to, and I think we haven't done badly after the war, at least from the 70s, from the mid-seventies onwards. Both sides have managed the relationship well and have also navigated the world reasonably well. After all, India and China were the biggest beneficiaries of the globalization decades, did best in terms of growth and so on. The problem is that you now have very complicated domestic politics in both countries where increasingly authoritarian leaders rely on nationalism or ultra-nationalism for their legitimacy. Because the ability to deliver huge economic gains is much less in today's circumstance. Anyway, the easy gains have been done already through earlier reforms and, but the promises that are being made are ever more, ever higher. So, you rely on, and so it's not economic legitimacy. So, you go to things like charisma, ultra-nationalism. You try and these are, you know, risky things because they reduce your ability to negotiate, to give, take, to do the bargaining, to actually adjust and make the compromises that you need to do in life. So, if that's the problem, then you have a very different situation, then you actually have diminished capacity and increased power at the same time. And for me, that's what I see in both systems. That's not a good or very hopeful sign. Let's see. I mean, it's, you know, never predict, especially not the future.
Srinath Raghavan: So as our listeners try to make sense of where China, particularly, and India in the context of China is going is there anything that you've read lately that you would recommend that they should read?
Shivshankar Menon: There's two things actually I would say. One is Edelstein: Over the horizon, time uncertainty, and the rise of great powers. It's about how you think about the rise of powers and how they adjust in the system and really time horizons, which we often forget time as the factor. The other is Yan Xuetong's book on the rise of great powers and leadership, the role of leadership, where he classifies international leadership's into aggressive, conservative, etc. because that gives you an idea of how the Chinese think and how the Chinese see this world, and how at least how Yan Xuetong expects a bipolar world between China and the U.S., where everybody else is miles behind. And these two will then, how they manage their affairs is what really will matter. And I think those two books for me were very interesting. Not that I believe everything they say because you know, as an Indian, you see things differently. I think we always have, and I think that's what sometimes the rest of the world can't understand, but these are worth reading.
Srinath Raghavan: Sure. And we will link these books onto the show notes. Ambassador Shivshankar Menon, thank you so much for joining us.
Shivshankar Menon: Thank you, thank you very much, real pleasure!
(Outro) Srinath Raghavan: Thank you for listening to this episode of interpreting India. A podcast presented every two weeks by Carnegie India. I'm Srinath Raghavan. For more information about the podcast and the production team, you can follow us on social media and visit our webpage.