China’s Grow­ing Pres­ence in South Asia: Con­cerns for In­dia

The Diplomatic Insight - - Contents - *Faiza Rashid Lone

South Asian re­gion, with rich cul­tural civ­i­liza­tion, geo-strate­gic lo­ca­tions, his­tor­i­cal ex­pe­ri­ences, va­ri­ety of ge­o­graph­i­cal fea­tures, world high­est moun­tain peaks, bank of re­sources, di­ver­sity in lan­guage, cul­ture, re­li­gious be­liefs and cus­toms, colo­nial lega­cies, va­ri­ety of cli­mate zones, daz­zling tourist at­trac­tion sites, is surely a gate­way of suc­cess, op­por­tu­ni­ties and progress. Pak­istan, In­dia, Sri Lanka, Afghanistan, Nepal, Bhutan, Mal­dives and Bangladesh to­gether con­sti­tute the South Asian re­gion. China shares com­mon bor­ders with four of the South Asian coun­tries; Pak­istan, In­dia, Bhutan, Nepal, and Afghanistan South Asia shares a ma­jor role in in­ter­na­tional af­fairs and global de­vel­op­ment. It is a land of great di­ver­sity com­pris­ing re­source rich coun­tries. The re­gion’s to­tal area is nearly two mil­lion square miles, home to 1/5th of world’s pop­u­la­tion. South Asia is one of the most at­trac­tive eco­nomic des­ti­na­tions. The re­gion serves as a link to South East Asia, Cen­tral Asia and the Mid­dle East. is man­i­fested with the pres­ence of In­dian Ocean in south, Ara­bian Sea on north-western side, Bay of Ben­gal on north-eastern side and ac­cess to Malac­can Strait and Per­sian Gulf on south-eastern and south-western side re­spec­tively. All th­ese ar­eas hold pol­icy with the ma­jor oil im­ports of China and trade ship­ping’s pass­ing through th­ese ports. This pa­per aims at dis­cussing the ris­ing Chi­nese pres­ence, in­vest­ments and en­gage­ment in South Asia and its un­der­ly­ing in­ter­ests, with a fo­cus on its im­pact on the In­dian dom­i­nance in the re­gion and con­cerns for In­dia.


Con­tem­po­rary strate­gic and eco­nomic im­por­tance for China. China de­sires to es­tab­lish friendly and mul­ti­di­men­sional re­la­tions with all the South Asian coun­tries as man­i­fested in part of her ‘string of pearls’ strat­egy. China’s for­eign pol­icy is based on main­tain­ing in­de­pen­dence, re­gional co­op­er­a­tion, world peace, good neigh­borly re­la­tions and en­hanced unity and co­op­er­a­tion with de­vel­op­ing coun­tries. China hopes to de­velop friendly and co­op­er­a­tive re­la­tion­ships with all the coun­tries on the ba­sis of mu­tual re­spect for ter­ri­to­rial in­tegrity and sovereignty, mu­tual nonag­gres­sion, non­in­ter­fer­ence in in­ter­nal af­fairs, equal­ity and mu­tual Some key prin­ci­ples of China’s en­gage­ment pol­icy in South Asia are geo-strate­gic com­pe­ti­tion with In­dia, en­ergy re­source re­quire­ment, eco­nomic ex­pan­sion, regime sta­bil­ity, non­in­ter­fer­ence prin­ci­ples, and re­sis­tance to mul­ti­lat­eral co­op­er­a­tion. China is also in­volved in sev­eral peace build­ing and se­cu­rity ini­tia­tives within the re­gion. China’s pol­icy visà-vis South Asian re­gion is de­signed at pre­serv­ing her eco­nomic and se­cu­rity in­ter­ests, most im­por­tantly its de­sire to get ac­cess to the In­dian Ocean. Ac­cess to South Asian mar­kets is im­por­tant for China’s econ­omy. China des­per­ately wants to se­cure her en­ergy trade and sea routes as most of its im­ported oil from Africa and Gulf re­gion passes through the In­dian Ocean along with her in­creas­ing trade ship­ping’s with Mid­dle east, Africa and Europe. There­fore, the sea lanes spread around the South Asian re­gion for­eign pol­icy. Be­sides se­cur­ing her oil, trade and en­ergy in­ter­ests, china does not want to have any kind of in­sta­bil­ity in the South Asia coun­tries, due to the large scale of in­vest­ments by Chi­nese com­pa­nies in min­ing, oil to en­sure steady sup­ply of re­sources/ raw ma­te­ri­als to China. China is also cau­tious of US pres­ence in the re­gion be felt in the re­gion. South Asia also holds the key for sta­bil­ity in China’s south western re­gions of Xin­jiang and Ti­bet.

China has emerged as an eco­nomic gi­ant and an at­trac­tive in­vestor for South Asian coun­tries. The trade be­tween China and South Asian coun­tries has in­creased man­i­fold, as it rose from $5.7 bil­lion in 2000 to $93 bil­lion in 2012, with an aver­age an­nual in­crease of over 26 per­cent where China’s im­ports from South Asian coun­tries in­creased from $1.9 bil­lion to $22.6 bil­lion.

in the coun­try, es­pe­cially in tex­tiles, agro-pro­cess­ing, en­ergy and power, phar­ma­ceu­ti­cals, com­mu­ni­ca­tions and in­fra­struc­ture de­vel­op­ment. This will re­duce the trade gap be­tween the two coun­tries,”

Prime Min­is­ter Sheikh Hasina China has been car­ry­ing out sev­eral de­vel­op­ment projects in Bangladesh In past China col­lab­o­rated with Bangladesh on nu­mer­ous projects like, con­struc­tion of bridges, nu­clear co-op­er­a­tion, coal min­ing pro­ject, es­tab­lish­ment of Dhak­abased Bangladesh-China friend­ship ex­hi­bi­tion cen­ter and ca­pac­ity-build­ing and train­ing as­sis­tance pro­grammes for civil ser­vants and se­cu­rity forces per­son­nel. Bangladesh govern­ment has re­cently sought fur­ther as­sis­tance from China in im­ple­ment­ing their Vi­sion 2021 pro­gramme. China is also in­ter­ested in in­vest­ing in the ap­parel in­dus­try of Bangladesh be­cause it is to high-tech in­dus­tri­al­iza­tion due to high man­u­fac­tur­ing cost there. In the last nine months, China im­ported $100m worth of cloth­ing items from Bangladesh and their tar­get is to reach $1bn by next year. China is very keen to de­velop a deep-wa­ter port fa­cil­ity at Sona­dia and the Chit­tagong port, which han­dles around 92 per cent of the coun­try’s im­port-ex­port trade. As for In­ter­na­tional Stud­ies South Asia di­rec­tor, Zhao Gancheng, “De­vel­op­ing the port is a very im­por­tant part of China’s co-op­er­a­tion with Bangladesh, and China is aware of its strate­gic

China is Sri Lanka’s ma­jor de­fence heav­ily in­vest­ing in the in­fras­truc­tural de­vel­op­ment and trans­port sec­tor of Sri Lanka. Re­cently, both sides have agreed on the ex­ten­sion of a rail­way, the south­ern high­way, and de­vel­op­ing the port of Colombo, where china is al­ready work­ing on the con­struc­tion of Ham­ban­tota port. In ad­di­tion to that China has granted a de­vel­op­ment loan of worth $2.2 bil­lion to Sri Lanka and has also agreed to col­lab­o­rate with them in de­vel­op­ing satel­lite com­mu­ni­ca­tion ca­pa­bil­ity, space tech­nol­ogy and mar­itime in­dus­tries. China has also de­cided to pro­vide de­fence tech­nol­ogy and per­son­nel train­ing to Sri Lanka. Sri Lanka is also plan­ning to launch a tele­com satel­lite in 2015 in part­ner­ship with China Great Wall Cor­po­ra­tion, cost­ing $320 mil­lion.

China em­bassy in Mal­dives was opened in 2011. The re­la­tions be­tween both coun­tries got strength­ened by visit of the cur­rent Pres­i­dent Mo­hammed Wa­heed to China. Last year in Septem­ber 2012, China agreed to pro­vide an aid of worth $500 mil­lion to Mal­dives. Re­cently, the air­port pro­ject given to the In­dian com­pany, GMR, was can­celled and was ap­proached by China. China is in­vest­ing in IT and com­mu­ni­ca­tion sec­tor of the coun­try and re­cently China gave a loan of US $5.70 crore to Mal­dives to im­ple­ment its In­for­ma­tion Tech­nol­ogy (IT) in­fra­struc­ture pro­ject. Tourist ar­rival adding to coun­try’s econ­omy.

Nepal holds a prime po­si­tion for China po­lit­i­cal ac­tiv­i­ties by Ti­betan refugees. Nepal and China share strong ties, with the lat­ter deeply get­ting ac­tive in se­cu­rity, eco­nomic and po­lit­i­cal sec­tors of the coun­try. China’s di­rect in­vest­ment in Nepal nearly dou­bled be­tween 2007 and 2011. China is as­sist­ing Nepal in de­vel­op­ing hy­dropower and in­fra­struc­ture fa­cil­i­ties. More than 60 schools in Nepal are of­fer­ing cour­ses in Chi­nese. China’s pri­vate sec­tor is in­ter­ested in in­vest­ing in the tourism sec­tor of the coun­try. Chi­nese tourist ar­rival in Nepal has also in­creased in the last few years. China de­sires to open up new trade routes through Nepal and has re­cently promised to in­crease the as­sis­tance.

For­mal diplo­matic ties do not ex­ist be­tween Bhutan and China. An is­sue of dis­puted ter­ri­tory be­tween both the coun­tries has not been set­tled yet but talks are in progress to set­tle the is­sue. Whereas, China is in­ter­ested re­la­tions, putting the bor­der is­sue at the back burner, and en­gag­ing with Bhutan.


Pak­istan holds a very vi­tal sta­tus in China’s for­eign pol­icy. Chi­nese in­ter­ests in Pak­istan are cen­tered on trade and en­ergy cor­ri­dors ac­cess. Pak­istan of­fers a nat­u­ral cor­ri­dor to China for her re­gional ex­pan­sion and growth by con­nect­ing western re­gion of China to broader South Asian re­gion as Gwadar port can make this dream pos­si­ble for China. China has made huge in­vest­ments in Pak­istan and the pri­vate sec­tors of both coun­tries are en­gaged in many joint ven­tures. With the hand­ing over of Gwadar port to China, the re­la­tion be­tween the two friends has be­come stronger. China is col­lab­o­rat­ing with Pak­istan trans­porta­tion, aero­space, mil­i­tary, marine in­dus­tries, cul­tural sec­tor. Some huge Chi­nese in­vest­ments in Pak­istan

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