‘China will be foolish if it attacks India’: Ambassador Shashank


When a prominent member of Prime Minister’s think-tank and a former ambassador to more than half a dozen countries including Russia confided that China is likely to attack India in 2012, it was a cause for concern. A little while later we saw Bharat Verma, editor of the Indian Defence Review, telling a prominent newspaper daily, that “there are multiple reasons for a desperate Beijing to teach India the final lesson, thereby ensuring Chinese supremacy in Asia in this century.” While heated debates ensued in the media over this issue, R.N.I. talked to Ambassador Shashank, former foreign secretary in the Government of India, to know his views about China’s growing economic supremacy, the measures being adopted to further India’s financial interests in the rest of the world and last, but not the least, how much are we prepared to match China’s military might in case of a full-fledged war.


R.N.I.: If we talk about China’s growing economic supremacy, what are the factors that have enabled China to gain edge over India in the recent past?

Ambassador Shashank: Whether we like it or not, China and India are neighbour and share several similar assets. Large population, better technology and partnership with other countries are the areas which are common to both. Lately, China has tried to encroach into area of influence ofIndiaby getting into large number of institutional frameworks inSouth Asia. Till now, India had done this successfully both in South Asia and North East Asia.

China has also been successful in keeping India out of Shanghai Cooperation so far wherein India has been of the opinion that focus of Shanghai Cooperation should be on containing terrorism, particularly terrorism emanating from Af-Pak region, but China has not allowed this to happen, particularly because of its relations with Pakistan.

There are other major differences. Whereas India is a democratic country, China is not. They, instead, are a very nationalist country that pursues its policies very energetically. There lies the difference! Whereas we, in a democratic set-up take time to come to decisions, announce policy and then dwell on discussions, they discuss and then announce their policy. This does not work in a situation where companies are trying to displace the governments in controlling the international economic order. Due to this, we have lost out to China on more than one occasion.


R.N.I.: You said companies are trying to displace the governments in controlling the international economic order. If an individual needs to have a vision for his future career prospects and if corporate houses need to have vision for futuristic growth, it will be naïve to say that an entire country’s economic interests can be developed on global levels without a futuristic world vision. Kindly tell us whether we have that vision? Are we seriously working towards making India a global economic power? Fact remains that despite continuously loosing out on many fronts, we still do not have one department in the country that is singularly occupied with planning and executing strategies to further India’s financial interests in the rest of the world. Surely, matters cannot be left only in the hands of economic ministries, which are already over-burdened handling domestic affairs?

Ambassador Shashank: You are right when you say that it is high time that we need to have one department, if not a ministry, to plan and execute India’s global activities related to its financial and military interests.

Let’s see what China’s strategy has been lately. China’s USP is cheaper production base. This has attracted multinationals to China. In fact, 60% of Chinese export is on behalf of these multinationals. China is reinvesting this money back in the international market. A lot of their money has been invested in the US itself, as they feel that without US support their dream of becoming global power won’t come true. A good portion of this money has been used to acquire strategic business interests in other African and Asian countries. They have a vision and are moving towards achieving that goal. We have to keep these things in mind. Unless we develop that futuristic world view and vision, we will be left out. This involves friendship with the United States, with addition to our friendship with traditional friends as well as neighbours like Pakistan. This involves friendship with China as well. These days it is not possible that we do not keep good relationship because of competition.

Whereas we know that India has to develop good relations with China, we will also have to move energetically and see that we keep our growth rate at par with China.


R.N.I.: Throw some light on the areas where we both have upper hand over each other and the future strategy that we should adopt?

Ambassador Shashank: We have upper-hand than China on many fronts. It will be in our benefit if we go for technology enhancement and create futuristic knowledge base institutions; these are areas where China cannot compete with us.

China has enhanced production but on the basis of outdated polluting technology. It is not possible for us to go back on these areas. We will have to develop our strengths differently.

Though friendship with the US is of paramount importance, we will have to take our own initiatives. We cannot look at other countries like US to help us. They will help us only till their interests are served. If they feel it is their interest to keep relationship with Pakistan, they will do so. If we plan our economic growth properly, there will be a situation where they will feel it is in their interest to maintain good relations with us.

We must build as many strategic partnerships and initiate strategic dialogues with other countries. Countries like Brazil, Argentina, South Africa and a few others are becoming bigger economic powers. Financial ties with such countries are important.


R.N.I.: What are the areas where we have lost out to China?

Ambassador Shashank: Though it is difficult to quantify, we have lost considerably because of lack of a proper foreign economic policy. Sudan was at one stage offering us a very good deal. It is a country where Shariah laws are applicable. Due to this we kept on dithering whether to do the deal with them. Meanwhile China went ahead and invested there.

In Angola too China moved fast to capture the business interests. Shell company was moving out and Angola was negotiating with ONGC-Videsh to hand over 600 million dollar equity share to India. Negotiations were more or less completed.Chinaused its influence with the Angola government to get that equity stake.

Till sometime back, it was the European countries and the US who had stakes in mines, oil and gas fields, etc. across globe. They converted their billions into trillions through it. Now China has also started doing the same and much more aggressively than others. At the same time, we dither taking decisions and are mostly occupied with domestic affairs rather than looking at tackling issues that will give us financial supremacy in world affairs.


R.N.I.: Has every thing been lost? Can we still take some corrective measures? If yes, what are those?

Ambassador Shashank: No, everything has not been lost yet! Whatever resources we have we can think of spreading them out. We can invest in Western treasuries and can also take maximum stake in world economy.

But the Government will have to take decisions. Economic diplomacy strategy has to be worked out. We will have to invest on agricultural fields, mines, energy resources, etc. outside. We will have to decide how much money can be put in foreign lands. At times risks too will have to be taken. Initially there will be few risks but, in long-run, we are bound to get good dividends.

Economic diplomacy in India is left to economic ministries whose main job is within the country. One has to think of some kind of new mechanism. Whether it is under National Security Council Secretariat, whether it is under the Planning Commission or whether it is under some new organization that is set up, this should be part of a planned exercise. Till now, every time there is a reduction on non-planned expenditure, such expenditures are cut as it is felt that they are external expenditures. This should not happen. It should be thought on the basis of national security perspective and our future planning perspective.

Second most important thing is our own neighbourhood. We should build infrastructural connectivity. We need to build up our own people’s strength in border areas. Whereas China has connected the entire border with India with roads, only 4-5% of the money earmarked has been spent on border roads in India in the last 5 years. CAG has commented adversely on it. This reflects perfectly on our approach so far.

To cut the matters short, we will have to build a futurist world vision, if we are to remain in competition!


R.N.I.: Last, but not the least, what are the chances of China attacking India in 2012?

Ambassador Shashank: Recent Chinese aggressive maneuvers on the 4000 kilometer Indo-China border do suggest that China is making preparations for a full-fledged war. Unfortunately, Indian response so far or rather India’s lack of response and failure to decide how it should respond has further aggravated the situation in China’s favour. This has made some pundits conclude that China may attack India in the near future.

But it will be foolishness on China’s part if it does so. I have said earlier that these days it is not possible that we do not keep good relationship because of competition. Moreover, China will be underestimating India’s military might if it does think of an attack. During the last decade, India has been the second biggest buyer of arms shipments, second only to Saudi Arabia and followed by China. While Saudi Arabia purchased arms worth $29 billion, India followed up with nearly $17 billion, China with $13.2 billion, Egypt with $12.1 billion and Israel with $10.3 billion. In 2010, despite slowing world economy, India was the biggest buyer of conventional arms among developing nations with deals worth $5.8 billion, followed by Taiwan with $2.7 billion deals and Saudi Arabia and Pakistan with $2.2 billion worth of purchases. While India’s policy is not offensive in nature, in case of an attack, we are fully prepared to give a befitting reply.