- China needs to keep a lid on domestic unrest, increase consumption
- Post-COVID-19, it can no longer depend on the export-focused economy
- For this, it must ensure smooth energy-flow from the Middle East
- And ‘acquire’ Baluchistan for a safe Gwader port
- Heavily indebted, Islamabad may ‘mortgage’ Baluchistan to China.
New Delhi: Sit back and reflect on the slow-paced past and the fast-paced present.
Remember the so-called Hindi-Cheeni Bhai Bhai slogan of the 1950s, which became a synonym for back-stabbing? India and China, decolonized in 1947 and 1949, respectively, were the contemporary ‘all-weather’ friends. Pakistan was firmly in the West’s anti-Communist camp, a member of the military alliances like Central Treaty Organization (CENTO)—also known as the Baghdad Pact or the Middle East Treaty Organization (METO). That was when Pakistan’s donation-and-begging bowl-based economy began.
It was in this backdrop that India’s first Prime Minister Jawaharlal Nehru backed China, introduced Peking to the Bandung Conference (1955), helped it get the United Nations membership, and later a seat on the Security Council. China waited patiently until India delivered all it could—and then struck in 1962.
But it was not to ‘teach India a lesson’ as the Chinese propaganda claimed. Its real enemy was the then “all-weather” friend USSR, whose leader Nikita Khrushchev crossed Chairman Mao Zedong’s path, and supported India. After a quick war against India, China grabbed territory and completed the ‘acquisition’ of Tibet.
Six decades later, China appears to be targeting India ostensibly to divert world attention away from COVID-19, Hong Kong, and Taiwan. But its real target for fresh ‘acquisition’ could well be its “all-weather” friend, Pakistan, an easy cherry to pick, the way Tibet was in the late 1950s. In other words, Islamabad is now a soft target for Beijing!
There are reasons: Pakistani economy, hand-to-mouth since 1947, is heavily indebted to Beijing which it views as its benefactor. The $60 billion China-Pakistan Economic Corridor (CPEC) passes mainly through the restive Baluchistan province of an increasingly fragile Pakistan. China has been watching Pakistan die the way vultures wait for the death of a crippled animal. If Pakistan has cultivated terrorists as ‘assets’, well, China has Pakistan itself as an asset!
A Confucian China, after all, believes in quick, low-cost, psychological virtual war rather than an expensive, long-drawn-out one.
In fact, China has actively pushed Pakistan to the cliff. Islamabad owes more money to China than it owes even to the International Monetary Fund (IMF)! Pakistan will have to pay nearly $ 7 billion to China by 2022 as loans racked up to boost foreign exchange and bridge a financing gap. On the other hand, Islamabad will have to pay only $2.8 billion to the IMF. Pakistan has been recklessly borrowing money from China to tide over its perennial financial crises. Still the Chinese money proved only enough to partly bridge the financial gap. But nobody cares in Pakistan, which many now see as a basket case. On the contrary, many Pakistanis are happy at a possible India-China conflict!
“The borrowing picked up after the Belt and Road Initiative started,” Hafiz Faizan Ahmed, who heads research at Karachi-based Optimus Capital Management Pvt Ltd., said. “A bulk of the Chinese lending happened about two years ago when dollar reserves were dwindling, so the government kept borrowing and borrowing.”
China’s recent forays into the Pakistan-occupied Kashmir (PoK)’s Gilgit-Baltistan region along Sino-Indian borders, may actually be to consolidate future of the CPEC, in which Beijing has already invested $46 billion so far.
Chinese President Xi Jinping’s ‘bonhomie’ with Prime Minister Narendra Modi was apparently showcased to ‘neutralize’ India on this count, at least for the time being, the way Chinese PM Zhou Enlai slowly managed Nehru’s neutrality on Tibet in 1959 before presenting the 1962 fait accompli. In other words, Xi sought to keep Modi in good humor the way Zhou did unto Nehru until China accomplished its target.
However, Modi is not Nehru. India substantially upset the Chinese applecart on CPEC in August 2019 by scrapping Jammu and Kashmir’s special status and reiterating its resolve to get back PoK. This could have completely jeopardized CPEC and made China look foolish. So, the Dragon waited for the right time to strike…and it did so in May when the snow melted and gave way for Chinese vehicles to reach the borders. Meanwhile, Beijing continued to caress Pakistan in the UN and other world forums on J&K.
The outbreak of COVID-19 and its unfolding fallout on the Chinese economy, apart from global consolidation of all anti-Chinese forces, has forced Beijing to hurry up its CPEC at any cost. The ultra-ambitious brainchild of Xi’s Belt and Road Initiative (BRI) had moved at a slow pace for a year due mainly to unrest in Baluchistan and the murder of some Chinese nationals.
COVID-19 has forced China to speed up CPEC as the only lifeline to its increasingly challenging economy. With many countries bracing to find alternatives to Chinese exports and multinational companies looking for multi-national supply chains, the Chinese Communist Party is extremely panicked about a possible, gargantuan domestic upheaval and unstoppable agitations for democracy, with active support from overseas. Hong Kong and Taiwan are only a beginning…with the arrival of a Bill in the US Senate, Tibet is next. A collapsed economy means a collapsed China.
The only way out for China, therefore, is to ensure energy-flow to keep its industries running and increase domestic consumption, instead of depending on exports.
To protect smooth energy flow from the Middle East—at a time crude oil producers like Iran and Saudi Arabia are scouting for buyers of their dirt-cheap oil—China must complete CPEC at all costs and get it going at full speed. Unless it controls this crucial artery, energy-guzzler Beijing cannot be sure of keeping its domestic economy stable, a sure recipe for disaster.
Clearly, the Baluchistan-based Gwader Port of CPEC is now the only lifeline left for China. The rest of the $200 billion BRI is history.
But China cannot depend on an unstable Pakistan to protect CPEC. There have been strains on this issue between the two countries, as reflected in adverse comments of some Pakistani Senators who view the CPEC as China’s colonization of Pakistan, the 21st century variant of East India Company.
In any case, Baluchistan is a heavy drain on Pakistan’s defense budget. The way Islamabad ‘gifted’ Gilgit-Baltistan to China, it may now ‘mortgage’ Baluchistan’s security to Beijing, the way Afghanistan had ‘invited’ the Soviet Union in 1979! In return, China may take Pakistan off-the-hook on repayment of debt. It would be interesting to see an atheist nation protecting a monotheist one!
In other words, China could ‘buy’ Baluchistan from Pakistan the way Britain, Russia, the USA, and Japan had ‘bought’ ports in China in the 19th century.