The Indo-US treaty and China
By Suman Pradhan
The signing of the nuclear cooperation agreement between India and the United States once again changes the dynamics of Asian security and geopolitics.
US President George Bush and Indian Prime Minister Manmohan Singh inked the treaty early this week in Delhi, paving the way for cooperation in civil nuclear programmes between the two giants. It also opens the way for the US to sell civilian nuclear technology to India, benefiting its companies.
India, meanwhile, will have to allow international inspections of its ‘civilian’ nuclear facilities, but can keep its military ones under wraps, as it has been doing for over three decades. India is not a signatory to the nuclear Non-Proliferation Treaty (NPT), and neither is Pakistan. Because both these countries refused to sign the NPT, they were refused official nuclear power status despite exploding several atomic devices in 1998.
But the Indo-US treaty now changes that status. By inking the treaty, Bush has formally welcomed India into the rarified club of nuclear powers. We can also see this as the first step towards India’s eventual inclusion into the UN security council, as it has long been demanding.
Pakistan, on the other hand, does not get any such treaty offer from Bush. The spin is that Pakistan has not been able to tightly control its nuclear technology, and therefore, cannot be offered such a treaty. US commentators have said that the proliferation of nuclear technology to “rogue states” by Pakistan’s “father of the atomic bomb” A. Khan makes that country unreliable.
We have to remember that the recently signed treaty is not yet in force and will not be so until both the India parliament and the US Senate ratify the document. Indian ratification is a foregone conclusion (because the treaty is beneficial to them) but in the US, a heated debate is already emerging. The Pakistani and Indian lobbies are already working overtime in Washington DC to defeat or help ratify the treaty, respectively.
Why is the debate so intense? Because, for one, it shows the US position as hypocritical, according to many critics. At a time when the US is trying to rally world opinion against the nuclear ambition of Iran, offering a treaty to a regional power who has flagrantly violated world opinion does not send the right message, they say. Critics also point out that offering India a treaty and refusing to do so to Pakistan only fuels the perception that US policy is anti-Islam, especially in light of its position on Iran.
Whatever the merits of that argument, what is more disconcerting is the effect the Indo-US treaty is going to have on China. Chinese leaders may not have forgotten why India exploded the bomb in the first place in 1998. George Fernandes, then-Defense Minister of India, clearly stated that India’s main enemy is China, and therefore its military programme is aimed at China. He did not even mention Pakistan, underscoring India’s deliberate tendency to ignore the pesky Pakistani problem and not even counting them as rivals. (India gets the same treatment from China, which sees US as its main rival). The trouble is the Pakistanis refuse to be ignored.
Now, how will China view this recent development? Chinese officials have remained deceptively quiet about the Indo-US treaty, but they must have already calculated the effects it is going to have on world security. Given that the US views China as a fast emerging global rival - whether it be in economic growth, global security or space exploration - the perception is that US policy is aimed at tying up China as much as it can through local rivalries. Therefore, by boosting India’s nuclear prospects, the US is trying to contain China strategically. This is only a perception and I cannot say how much truth lies in it. But this is also classic great power politics, and unfortunately it is played even today whether we like it or not.
If Chinese leaders indeed make this connection – and mind you, this is only a hypothesis – it won’t be surprising to see them court Pakistan openly in the future. Because great power politics demands equal and forceful response, China will try to constrain the rise of India by boosting Pakistan, and therefore hampering the US’ long-term strategic goals. And we all know what that can lead to. Tibet is so nearby.
Does all this sound familiar? Yes, it’s called a Cold War. And while a true Cold War may never happen again, just the possibility it could, gives certain rulers room to play one party against another in their effort to stay in power. Again, does that sound familiar?
Whatever the merits of the Indo-US treaty, from a purely Nepali perspective, I’m afraid of its implications on our democratic aspirations.
March 4th, 2006 at 9:46 pm
Glad to see you back after an unusual silence.
As usual, non-confrontational but as smart as Tim Russert, Brian Williams, Jim Lehrer, Bob Schieffer, Carole Simpson, Charles Gibson, Judy Woodruff, Tom Brokaw, Dan Rather, Peter Jennings, and routinely punctuating provocation-fertile areas with the term “just a hypothesis,” a signatorial preemption (to ward off possible aggressive dissenters) !!!
Nice, I like that !
March 5th, 2006 at 1:06 pm
I admire the way you have inserted your view in-between what the “critics” say: “US position [is] hypocritical, according to many critics. At a time when the US is trying to rally world opinion against the nuclear ambition of Iran, offering a treaty to a regional power who has flagrantly violated world opinion does not send the right message, they say. Critics also point out that offering India a treaty and refusing to do so to Pakistan only fuels the perception that US policy is anti-Islam, especially in light of its position on Iran.”
However, I beg to differ a bit (not wholly) with the view that the U.S. is empowering India to slow down China’s rising dominance (”Therefore, by boosting India’s nuclear prospects, the US is trying to contain China strategically.”). The question of neutralizing China could be framed within the question of whether the US consumers can say no to the Wal Mart, K-Mart, Dollar Stores, Target, Albertsons, United, Food Lion, Super Fresh, or the like that is a mini-China that American survives on.
I like a guy called Ben Stein, depite his Republican background.
He was a speech writer and lawyer for Richard Nixon at The White House and then for Gerald Ford. Ben Stein is a Columbia/Yale educated economist, writes for The Wall Street Journal, The Washington Post (Left Wing), and The New York Times (Left Wing). He has written and published sixteen books, seven novels, largely about life in Los Angeles, and nine nonfiction books, about finance and about ethical and social issue in finance, and also about the political and social content of mass culture. He is also a well known actor in movies, TV, and commercials. He currently writes a biweekly column on economics and finance for The New York Times (Left Wing) and appears weekly on the Fox News network (Right Wing) commenting on finance and economics. He has recently written on a US-China issue, “Trade with China: More Gain Than Pain for Americans.”
In this article, Stein kinda speaks for the American middle class and lower class people. On the light of this article, we may suggest that India and China fulfil two different appetites for the US: India will fill in the science-tech and China will fill in the day-to-day consumer needs.
More importantly, the shift of focus toward Asia (China, India, Central Asia, and Eastern Europe) is a contingency plan for the U.S. in case the Western Europe starts forgetting what it owes to America. The shift to Asia is a way to threaten the European power (Euro dollar) and its increasing independence from the US.
However, for now, let us return to Stein guy. The middle class and lower class Americans make up more than 99% of the total population. This population needs China: they are addicted to China. The course cannot be reversed despite the suggestion forwarded by Charles Schumer and Lindsey Graham. Their proposal in the Senate would have 27% tariff upon any goods coming from China (See “China: Friend or Foe?” http://finance.yahoo.com/columnist/article/yourlife/1615 ). They will loose their seats if they push this too hard. People are laughing at them because nobody wants to pay 27%-30% more for the same goods.
I am pasting the entire article here:
It’s about the worst idea [27% increase in price] in the field of trade I have ever heard of, and here are a few reasons why.
First, let’s admit that when we import hugely more from China than we sell to them, decent, hardworking Americans lose their jobs, in New York and South Carolina and a lot of other places. But on the other hand, the whole country benefits from buying manufactured products far cheaper than before. The whole idea of Wal-Mart is basically to offer us Chinese goods dirt cheap. This raises the standard of life of almost everyone who lives near a Wal-Mart. The U.S. benefits when it can buy cheaper T-shirts, pajamas, table cloths, toasters, and TV sets because we get them from China.
The solution for the displaced workers is not to penalize the whole nation by slapping a tariff on Chinese goods. Instead, we should retrain those workers whose jobs have been lost and let them have careers (in health care, for example) where they cannot be harmed by overseas competition.
Second, when we buy more from China than they buy from us, they wind up with a lot of U.S. dollars — hundreds of billions of dollars. What do they do with them? They buy U.S. Treasury bonds, in large part. This helps us finance our immense federal deficit, keep interest rates low, and allow America’s economy to grow faster than any other large Western economy.
The Chinese don’t do this out of charity. They buy U.S. Treasury bonds because they see the country as a safe, stable place to park their money until they need to withdraw it to pay for their workers’ retirement. If we started a trade war with China, the Chinese can stop buying our bonds, sell some of what they already have, and make life uncomfortable for us.
Why should we ask for such confusion in the debt markets to punish a country whose main sin apparently is selling us goods very cheaply? (Obviously, China has other sins, including gross human-rights issues. But I notice no one is proposing to punish them for their arbitrary and cruel “justice” system.)
Too Late for Isolationism
Third, China is a major trading partner for most of the world and a part of the World Trade Organization. It’s very questionable whether the U.S. is even allowed to slap on a tariff beyond what was already agreed upon to punish a nation for exporting too much. We’re already in so much trouble in the world that to start a trade war on top of Iraq seems to me the height of folly.
Moreover, we export to China in a big way. Timber, hides (on an immense scale), passenger planes. China can buy these from Canada or New Zealand or France. If we put on a punitive tariff, the Chinese will unequivocally retaliate. They’re a proud and strong people. We shouldn’t push China around. The country is in a position to make a lot of agony for the U.S. about Taiwan. Why encourage them to do so?
Frankly, I’m not sure what the solution is to the trade imbalance with China. I suspect that — as usual — the ticket is for all of us to save more so that when the dollar depreciates against foreign currencies, as it surely will, and imports get more expensive, we will be able to buy them (see “Living Hand to Mouth — and Barely Getting By”).
But the solution is not to stir up a hornets’ nest, raise prices at Wal-Mart, start a trade war, insult a proud and strong people, harm the employees of Boeing and thousands of other companies, and make us all look foolish and have to eventually back down.
It’s far too late to turn back to isolationism — and it never was a good idea in the first place.
March 7th, 2006 at 2:31 am
Nice one. Pradhanji..