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Changing Dynamics: China, India Come Together as Trump's Trade War Threatens Asia

Aware of the fact that it needs to concentrate its attention and energy to battle Donald Trump’s tariff onslaught, China has reached out to India.

Maha Siddiqui | CNN-News18

Updated:July 5, 2018, 9:47 PM IST
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Changing Dynamics: China, India Come Together as Trump's Trade War Threatens Asia
PM Narendra Modi with Chinese President Xi Jinping during their ‘informal’ April meeting in Wuhan. (PTI)
New Delhi: As China braces for an all-out trade war with the United States, it has been making a conscious effort to close other fronts, especially in the neighbourhood.

The Wuhan informal summit between Prime Minister Narendra Modi and Chinese President Xi Jinping was the initiation of this move in the earnest. Aware of the fact that it needed to concentrate its attention and energy to battle Donald Trump’s tariff onslaught, China reached out to India.

Soon, the country resumed sharing hydrological data on the Brahmaputra, which was stopped abruptly last year. On the sidelines of the Shanghai Cooperation Organisation (SCO) summit in Qingdao in June, China renewed its agreement with India. It also agreed to allow the import of non-Basmati rice from India.

India too seems to be thawing towards its neighbour. Sources have told News 18 that India and China will hold a maritime dialogue soon. Though this is the second such dialogue between the two Asian giants, it is significant as it comes after a gap of two years. More importantly, it is a result of renewed efforts in November last year to revive the Quad between India, US, Japan and Australia on the sidelines of the East Asia Summit in Manila.

The significance of the Quad, as a possible attempt to counter China, was not lost on Beijing. Chinese foreign ministry spokesperson Geng Shuang had said, “We welcome the development of friendly cooperation between relevant countries, but we hope this will not be directed at any third party.”

It wasn’t until June this year, after the Wuhan summit, that India clearly addressed China’s concerns. While talking about the Indo-Pacific region during the keynote address at the security forum — Shangri La Dialogue — Modi said, “It is normal to have partnerships on the basis of shared values and interests. India, too, has many in the region and beyond. We will work with them, individually or in formats of three or more, for a stable and peaceful region. But, our friendships are not alliances of containment.”

Sources revealed to News 18 that presumably, the PM’s statement at Shangri La would form an important basis of the bilateral maritime dialogue with China. They added, “Doubters need to be explained and not just the obvious ones.” This alluded to questions being raised by some East African countries and ASEAN itself. India is also working on holding a bilateral maritime dialogue with Russia.

Meanwhile, Chinese defence minister Wei Fenghe will visit India soon, sources said.

On the economic front, the Reserve Bank of India has granted licence to the Bank of China to operate in India. This was a “commitment” made by Modi to the Chinese President, according to sources. Bank of China is one of the few state-owned commercial banks in China.

In another such move, Air India decided to rename Taiwan as Chinese Taipei on its website. Defending the move, the ministry of external affairs said the airline’s decision “is entirely consistent with international norms and our own position on Taiwan since 1949”.

However, there has been a sharp response from Taiwan. The Taipei Economic and Culture Center (TECC) in India said, “It was deeply disappointed with Air India changing Taiwan to Chinese Taipei on its website and regrets that this move taken by Air India, a state-owned airline, can be seen as a gesture of succumbing to the unreasonable and absurd pressure from China.”

The two Asian giants had decided in Wuhan to make an effort to shed the bitterness over the Doklam stand-off and look at areas of convergence, especially on the economic front. But the timing of the move is being viewed in context of America’s ongoing trade war that has impacted Asia.

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