Golez: "Sikkim standoff: China should fear the brewing trade war, it has more at stake than India"
I quote from this First Post article:
"China has much to lose. There are a few reasons for this:
1. China exports much more to China: $60 billion versus imports of only $9 billion: "First, China has been enjoying a thriving trade relation with India over the years. India has about $ 52 billion trade deficit with China. Last year, India exported about $9 billion worth of goods to China while China exported $60 billion to India. Chinese presence is evident in almost all sectors ranging from electronic items to pharmaceutical products. Chinese companies would not want to spoil the business opportunities the Indian market offers to them."
2. A conflict with India will disrupt China's Belt & Road Initiative: "Second, an even bigger impact for China will be on the One Belt, One Road (OBOR) initiative. Antagonizing India could stall the progress of this ambitious Chinese project. China is well aware of this likely backlash. China has already invested heavily in this project. As noted in an earlier Firstpostpiece, China is in the midst of expanding its economic reach in South Asia through its much-hyped China-Pakistan Economic Corridor (CPEC), which is critical to its OBOR plan."
"A significant chunk of investments (at least $ 50 billion so far) have already gone into this project by Chinese companies. India has already expressed its displeasure to China on CPEC plan layout since it crosses through the contentious part of Kashmir, which is occupied by Pakistan and claimed by India. Some of its neighbors like Sri Lanka too have spoken in favour of India on this issue saying it is difficult for India to accept the CPEC since it passes through the 'heart of Indian interests'. China will further risk the fate of CPEC and OBOR if it escalates tensions as India can pave hurdles on the progress of OBOR."
3. Indian Ocean choke point where 80% of China's oil imports pass through: "Third, Chinese experts have already cautioned their government about the negative impact China will face in the Indian Ocean, where India has a dominant position. As this article in South China Morning Postnotes, China is heavily reliant on imported fuel and more than 80 percent of its oil imports travel via the Indian Ocean or Strait of Malacca. “India is strategically located at the heart of China’s energy lifeline and the ‘Belt and Road Initiative’, and offending India will only push it into the rival camp, which [Beijing believes] is scheming to contain China by blocking the Malacca Strait and the Indian Ocean,” the article quoted Macau-based military expert Antony Wong Dong as saying.
4. A China-India conflict will accelerate the emerging US, Japan, India alliance: "Fourth, India has much stronger diplomatic ties with US, Japan and a host of other countries than ever before. Making India an enemy would push China in the opposite camp and it will erode the gains it has been making as a peace-loving, matured country that aspires to become a world leader. Beijing wouldn’t want to gamble its hard-won image by prolonging the military stand-off with India. Also, it is set to host the 2017 BRICS meet in September where India is a member along with Brazil, Russia and South Africa. It will be a big embarrassment for the Chinese leaders to face an Indian delegation to talk on strengthening BRICS at a time when both countries are engaged in a trade war and likely military conflict.
"Perhaps, China has even more reasons to put an end to this uneasy phase at the earliest than India has, the main among them, of course being the fate of its ambitious OBOR initiative."
Sikkim standoff: China should fear the brewing trade war, it has more at stake than India