‘India needs to be intimate with China’

Writer Martin Jacques sounds a wake-up call for India: engage China or prepare to endure its hegemony

With his influential book, When China Rules the World: The End of the Western World and the Rise of a New Global Order, writer Martin Jacques shatters the West’s hope that China will become just another compliant member of the US-dominated world order. In his view, China is seeking its own path to modernity and expects to reshape the world in its own image. Jacques sounds a wake-up call for India: engage China or prepare to endure its hegemony

Q What will be the political and economic consequences of China’s rise for India?

A China’s economy is four times the size of India’s now. The rise of China is going to leave a big footprint in East and South Asia. China is already India’s biggest trading partner. China is going to be a much much bigger trading partner in the future. It’s going to dwarf its relationship with other countries. For India, the problem is that it needs to sort out what its relationship is going to be with China.

The difficulty India has with China is 1962. For India, China is a trauma. Trauma is not a good psychological condition. That is not a condition for achieving clarity. Sort out your border with China. It distracts and traumatises India. It’s not a big issue for China. I don’t think the Chinese will do it. India’s view should not be of strategic competition but strategic cooperation with China. India is going to be the junior and weaker in the relationship. India needs to be clear about the context and priorities of the relationship. The whole question of relations with China needs to be elevated to higher levels in society and government.

Q Do you foresee China moving towards democracy?

A China will become more democratic, but maybe not multi-party. What has happened is, the Communist Party has become more open and transparent. It’s not difficult to imagine mayoral elections in some cities. It will be done piecemeal. There’s no political demand for Western democracy in China.

Q You say that the Chinese consider the State a patriarch of the family. They approve of State participation in each aspect of life. That is its tradition, is it not? Do you see China’s young people challenging it?

A I don’t think there is a basic antipathy to the State. It’s sort of part of the DNA of Chinese society—respect for and deference to the State. That is what they think China is. Tradition is reproduced in new forms.

Q How will the rise of China benefit India’s neighbours, Pakistan in particular?

A It gives Pakistan something independent of India. In that sense, it’s an economic advantage for Pakistan. India’s problem is that it hasn’t conducted its relations with its neighbours particularly well. It has thought of itself as overwhelmingly large. It is paying the price for it. These countries are happy about their relationships with China.

Q How important is the Indian market to China?

A It’s not a huge deal in terms of money, which suggests to me that it doesn’t loom large in Chinese corporate strategy. That could change, but at the moment, there is a limited view. In terms of the Chinese economy, I think there are a range of firms—a small number of firms, Lenovo, Huawei—that can compete with Western ones. There are a lot of firms that are just below this level. The ones which make high-speed railways, for example. The Chinese could build a high-speed rail system for India. I think India should seize this [opportunity] with both hands.

Q There is a common perception that Chinese research is less prolific than that in Western countries. What are the strong areas of Chinese research that India needs to watch out for?

A Nanotechnology is one. Their most important emphasis is on science and technology. That figures largely in their 12th five-year plan. Renewable energy, aviation too. They are very systematic. They are putting a lot of resources in these areas. It’s a priority for their economic development. It’s a combination of their own graduates, citizens who have gone to Western universities, and thirdly, they [have been] pushing for [the past] two-three years now to persuade the Chinese who have settled in America and are top academics to return to China. They are offering them very very good salaries, good living conditions and good research facilities, sometimes rather better than the West. They’ve had considerable success in this. With budget cuts in America, it is a very attractive proposition.

Q China’s rise is about its economy. Many of the best-performing companies in China are owned by the Chinese government…

A I don’t think India can copy it, the ubiquity of the State and the way it is engaged with each aspect of Chinese society, though not in the inert way one associates with State-owned enterprises. The way the Chinese state operates is very different from the West. They have minority shareholders who are private. They can raise money via IPOs. Chinese firms are State-owned, but they are private firms in the way they operate. Maybe they are less innovative than private firms, but the Chinese economy is kind of volatile, and they provide a certain stability to it. State-owned firms can be useful to weather these times. But you need a dynamic state to have dynamic state-owned companies.

Q You write, ‘The way in which China handles its rise and exercises its growing power in the East Asian region will be a very important indicator of how it is likely to behave as a global power.’ In the years after you wrote that, how has China behaved in the East Asian region?

A I think that China’s got into difficulties in Southeast Asia. Northeast Asia is problematic for China because of Japan and South Korea—because this is an area of the world where the Cold War is alive and well. Only Taiwan has moved much closer to China. That process could well continue. Southeast Asia is a different kettle of fish—small, less developed nations. The Chinese made great progress in that part of the world. But in 2010, the Americans tried to reinsert themselves into the region. How this is going to be sorted out is difficult to say. The Chinese have tried. Meanwhile, the Philippines and Vietnam have been flexing their muscles with America’s encouragement.

How cohesive is Asean? It is diverse, and there is a new diversity creeping in, between the archipelago countries like Indonesia, Philippines, Malaysia, Singapore, on the one hand, and the five other countries—Myanmar, Vietnam, Thailand, Cambodia and Laos, which are being drawn into an integrative process with China. Asean’s ability to be unified is going to be affected.

Q You say that the Chinese renminbi will be among the top three currencies of the world. For that, the renminbi needs to become convertible. When do you see the Chinese authorities letting that happen?

A The big expansion of the renminbi as a trading currency could be in the next ten years. There is a process by which they are making the renminbi available outside their borders. Hong Kong is playing a key role in this. London has been bidding to be the European centre of the currency. Meanwhile, HSBC has projected that half of China’s trade with the developing world will be conducted in it. But for China, internal conditions are more important than external ones. Their priority is economic stability. So, convertibility will take its time.

Q Is China likely to create institutions like the Bretton Woods twins, World Bank and International Monetary Fund (IMF)?

A I don’t think the Chinese are into grand gestures like that. What is more likely is, first of all, you’ll get pressure from developing countries, with China in a leading position, for reform of the IMF and World Bank, because at present the voting structure doesn’t reflect the size of their economies. Every managing director of the World Bank has been American. India is of course making common cause with China in this, and rightly so. So we’ll see continuing pressure. I’m very sceptical that these institutions will retain their centrality in a new multipolar world in which China is hegemonic. They might carry on, but be reformed belatedly, kicking and screaming. In 2009 and 2010 the two Chinese banks lent more to the developing world than the World Bank. That’s one hell of a statement. The Brics Summit has announced that there will be a Brics Bank. I’ve been quite struck by how Brics has stayed on the road and gradually acquired new functions and new credibility.

Q Moving to culture, we are heavily influenced by the West. In the two decades ahead—I’m asking you to go out on a limb here—to what extent will we see the spread of Chinese cultural expressions in India?

A The two societies have so little to do with each other. The two societies have last been in contact over a millennium ago. Because of the Himalayas, the two societies are profoundly different. The problem with India’s relationship with the West is 200 years of British colonialism, which has left a deep impression on the Indian mind. India has not achieved full independence of the mind. The mind is still partially colonised by a Western discourse. It’s quite natural, 1947 is not long ago. The colonial impression on India is much deeper than on China. It is not surprising that India looks West, because that has been its history for [at least 200] years. Also because India feels inferior to the West and feels it needs its approval. It’s very bound with the Western discourse. It’s only achieved limited independence. That isn’t to deny its achievements. China will come to exercise growing influence on India. That’s inevitable. How will it proceed? Because the two societies are so different and have so little contact, one should not expect any great transformation. But India needs to be intimate with China. The two societies need more exchanges.

Q Do you suppose the Chinese government would allow greater contact between our people? Our perception, perhaps uninformed, is that Chinese rulers consider our fairly-democratic institutions a potential threat to their doctrine.

A There are many things in common between India and China: colonialism, civilisation, but the single difference is that China acquired its present polity in 221 BC. There is an essential line of continuity. The State is the embodiment of China. India only achieved independence in 1947. For the Chinese, the State is an intimate. The Chinese would say, ‘What’s the point of democracy if you don’t have a competent State?’ Reconfigure the view of the State from the election or selection of governing institutions, to: ‘What is required to have competent institutions?’

Q Many Indians are racist. They have a negative view of dark-skinned people, largely because they equate dark skin with ‘low’ caste. Such Indians admire white-skinned people. You have said that the Chinese too have a negative view of dark-skinned people. How do they view Indians?

A In Chinese history, colour is very important.

ChinademocracyMartin Jacques