Transcript
Raveena Shivashankar (RS): Good afternoon, General Narasimhan. Welcome to the 24th episode of Unfolding Geopolitics. General Narasimhan is our Adjunct Distinguished Fellow on National Security and China Studies. He served in the Indian Army for 40 years and has worked extensively on the India-China border. He was also a former member of the National Security Advisory Board, where, during his tenure, he focused on China and India’s border.
Today, we will be discussing the power struggle in China and examining whether President Xi Jinping is losing power.
The Central Committee of the Communist Party of China recently concluded its Fourth Plenary Session in October. What are some key takeaways from this?
Lt Gen S L Narasimhan (SLN): The plenary session generally talks about the five-year plan. The 14th Five-Year Plan is getting over this year, and the 15th Five-Year Plan is going to come up from next year onward till 2030, which is going to be an important period for China.
Basically, there have been talks that the Chinese economy is not doing well, it’s under pressure. Domestic consumption is not increasing, so there are a lot of imponderables in that economy. Real estate had a problem in 2021, so there are a lot of these issues that are coming up. The five-year plan will lay down the growth pattern, the kind of projects they need to undertake, etc., for the next five years. That is one aspect of it.
The second aspect is, of course, it came out in the communiqué that the people should follow the core of the Communist Party, which is Mr. Xi Jinping. That comes up every time with the end of the meeting they need to follow. Xi is the core of the Communist Party of China, and so they should follow his direction. That, of course, was there.
The other thing was that the eight generals who were actually removed from their positions earlier were also removed from the party positions that they had, so that is the other thing that you saw in that particular session. And, of course, there was a paragraph on the People’s Liberation Army (PLA) as to how they should go for modernisation, or how they should prepare to fight modern wars, etc. So these are the general things that you find. Yesterday, there was a report to say that they are looking at a 4.1% growth for the next four to five years. So these are the kinds of main things that came up in the Fourth Plenary.
RS: China is facing a lot economic problems currently, there are also rumours that Xi Jinping is losing power in China. So, A) there are internal rifts within the CPC, B) Xi Jinping has initiated a military purge—you just mentioned that he expelled nine high-ranking military officials, including the Vice Chairman of the Central Military Commission—and C) there are internal issues facing Chinese companies. So, does this affect Xi Jinping and China in any way?
SLN: I think these are mainly rumours. I, for one, don’t believe that Xi’s power has been degraded in any form. Just for example, he not only sacked these generals, but he has also sacked more than 100 generals since 2014 onwards. He has sacked his defence minister; he sacked his foreign minister—still, he is in power. So, I don’t think there is any threat to Mr. Xi Jinping’s power in any form at this point.
While the purges can indicate certain other things, like, for example, corruption in the PLA or, in some measure, the people were not listening to or following the party’s tenets. That is the first thing. Second, there are loyalty issues. Third, there can be many reasons for these purges, but the very fact that Mr. Xi Jinping has purged all these people and is still on top, I don’t think there is any threat to Mr. Xi Jinping’s power at this point in time.
And another indication is that there is no indication of who is going to succeed Xi Jinping in 2027. Therefore, the understanding of many analysts is that even in 2027, Xi Jinping will come back to power for the fourth term. So, put all this together, I don’t see any kind of threat to Mr. Xi Jinping’s power. That is the way I see it.
RS: So these are just rumours?
SLN: Absolutely. And you will find it—go back in history. This is what I keep telling. Anybody who studies China has to not be episodic in their analysis. You have to go back to history and check. Look at Mr. Jiang Zemin. I mean, how many times did the analysts and the media kill him before he actually overpowered Hu Jintao? So, I don’t think there is any kind of problem with Mr. Xi Jinping. He’s fine, and his position is as strong as it was earlier. Maybe there could have been some minor change, but I don’t see a major kind of issue there.
RS: Coming to China’s relations, we recently saw that there were recent trade negotiations between China and the U.S. How is the China-U.S, relationship evolving so far, and do you think this will lead to a bilateral trade agreement?
SLN: If you take your mind back to January this year, when Mr. Trump came to power, right from that time onwards, there has been no adverse comment by Mr. Trump to China or America, for that matter. So that is basically because there was a hope that this could result in some kind of trade agreement.
But you take your mind back again to Trump 1.0, they did sign phase one of the trade agreement, and the Chinese committed to buy certain amount of things from the U.S., but that has still not been met. So, even if that commitment is not met, how are they going to meet any fresh commitments that are going to come? That is something we need to work on.
However, I get a feeling that the Chinese government was better prepared this time to face Mr. Trump and his tariffs. Like, for example, initially, when he came to power, he hiked up the tariffs 1.48%. The Chinese sent up to 125% and said, “Beyond this makes sense.” So, when we over-increase automatically, the tariffs came down to 30%. Now, after the recent meeting of Mr. Xi Jinping with Trump, he removed 10% tax that he placed on fentanyl supplies. So basically, the reciprocal taxation of 10% is going to remain, and the additional 10% is going to come up.
In between, the trade negotiators of both countries have been meeting. In fact, before Mr. Trump met Xi Jinping, there was a report from both negotiators to say that they had agreed on a preliminary framework for a trade agreement. So the entire media went wild, saying that they’re going to sign the trade agreement. Please understand the words “Preliminary framework for a trade agreement,” which means even the framework has also been a preliminary one that has been agreed upon. You have to come and agree upon a framework first, and then go on to the trade agreement.
So while it might happen, I don’t see it happening tomorrow. It may take some time, some more negotiations, and it might happen at some point in time. But the way the White House listed the outcomes of this meeting between Mr. Trump and Mr. Xi Jinping, you find it appears as if the U.S. has walked away with a lot of stuff from China. Like they said, fentanyl will not be supplied, rare earths will resume supplies, and a whole lot of other things that they listed off. So, to my way of thinking, there was some kind of productive talk. The trade agreement is still some time away. They may have had interim concessions that may have been worked out between both the countries. I think that is the way you need to see this trade relationship at this point.
RS: Is there any talk on security between the U.S. and China?
SLN: The U.S. and China have had a kind of relationship that characterises what the previous administration talked about: “three Cs” – co-operation, competition, and contestation. So, at the moment, I see it’s a relationship of competition to get ahead, either in terms of economy or in terms of science and technological development—whichever way you see it, it’s a competitive kind of relationship. So, I think that’s the kind of relationship that will continue.
But also, please take note of this, a few hours before Mr. Trump met Mr. Xi Jinping, he announced that the U.S. will resume nuclear testing. The origin of this you need to go back to Trump one, wherein Mr. Trump withdrew from the Intermediate-Range Nuclear Forces Treaty (INF Treaty), saying that some of the countries that are outside the INF Treaty were carrying out testing and expansion of their arsenal. So the roots remain there. However, he has allowed the nuclear testing at this point in time.
What we also need to keep in mind is that the development of the warhead, per se, actually was frozen somewhere in the ’80s. It is the delivery system that has been getting modernised over a period. The testing of the delivery systems. Now, what he said is he’s going to test the warheads, improve the warheads. So it is a game that is going to start. And you also take your mind back to when, in 2021, the Foundation of American Scientists found 300 new silos coming up in the Xinjiang province of China. So obviously, there was some kind of expansion happening in China, too.
So you find that is why I say it is a game of contestation. If somebody does something, the others want to actually compete with them. So it’s going to be a relationship of contestation, but I don’t see it facing up to a conflict. I think both these sides have been fairly well restrained, I would say, though there were two mishaps in the South China Sea—one helicopter and one aircraft from the aircraft carrier sinking. Other than that, China has also been blamed for buzzing certain Australian aircraft and things further in the South China Sea. Beyond that, I don’t see this getting into a conflict situation, but there will always be competition. There’s no doubt on that, both economically and otherwise, because in the science and technology field, out of 64 technologies, the U.S. was leading in almost about 55 to 60 of them about 15 years ago. Today, China is leading in 57 of them.
So obviously, there is a race that is on. That is why you find in the Biden administration they talked about “small yard and high fences,” which means certain critical technologies will not be shared with China. There will be restrictions on sharing that kind of technology with China. So, to that extent, there’s going to remain a competitive kind of relationship.
RS: Right. What are some major developments in China’s South Asia Neighbourhood Policy, and what does it mean for India, and how is India responding to it?
SLN: China has a friendly neighbourhood policy, and we have a Neighbourhood First policy. So, either way, India’s neighbourhood is going to be a kind of an interesting place to watch for both China’s intervention as well as India’s.
India, in the last 12 to 14 years, has increased its assistance to the neighbourhood three times what was in 2012–13. But then India has its own requirements for development and other things. They don’t have endless amounts of money to give to people. The Chinese economy is stronger. The Chinese economy would probably have its influence in South Asia, and South Asian countries also hedge between India and China, like any other small nation would do. There are two bigger nations and one smaller nation in between. I’m saying smaller in terms of size and other things, not in terms of state. So, that will always happen in a manner that they hedge between these two countries. So, India’s neighbourhood will also try and hedge between India and China. We should be prepared for it.
Take your mind back, when Kargil happened or when any other incident happened between India and China. None of these countries made any statement. So, that is to be expected. However, there will be some kind of—again, look at the recent developments like China holding meetings with Pakistan, Afghanistan, and Nepal, then expanding into Bangladesh, Sri Lanka. Recently, in the month of May or June, they had a meeting in Kunming of China, So all these things are indicative of the fact that there is some kind of Chinese intent to increase its influence in the neighbourhood, which is natural. I would say that probably they also would look at this region, and they also have a problem of having the Malacca Dilemma. So they need access to the Bay of Bengal and the Arabian Sea. That is the way you find the China-Pakistan Economic Corridor coming to the west of India and the China-Myanmar Economic Corridor coming to the east of India. So, these are the kind of things that will play out.
However, the nations in India’s neighbourhood also realise the importance of India, and the geography dictates that India will be the first responder to them for anything that they need. So they also know that, they also understand that. However, they also need money for development and other things. They also look at China, for that matter. So, it is a matter of them factually trying to hedge between India and China. That’s what will happen even in the future.
RS: Is India in any way trying to counter this?
SLN: Maybe there’s nothing to counter here. If you look at it as a contestation, yes, then you need to counter it. What I’m saying is, if you look at China’s assistance in our neighbourhood, it will probably weigh more towards loans than grants. If you look at India’s assistance to its neighbourhood, it will be the reverse of that—it will be more of grants than less of loans. So the countries do understand it. Okay.
However, they need a lot of money for their development, and so they look at China, and they also look at India also. That is the way I think you need to look at it. Whatever India can afford to part with for the neighbourhood, I’m sure they will definitely do that, but it’s not endless deep pockets that we have. So we also have to look after our own development. So it is maybe that China has got more money to give to the neighbourhood. That is something that you can’t contest. Okay.
However, the traditional roots, the traditional relationships in India’s neighbourhood, are very strong—barring Pakistan, of course. So that will always work to our advantage. So, even if you may find Bangladesh, there is just something which is now becoming difficult to handle, etc. It is becoming difficult to handle, but international relations are never permanent. So it will go up, it will come down; it will go up, it will come down. I’m sure now India-Bangladesh relations may be slightly down, but I’m sure they’ll come up. Like, for example, you have the Maldives. The relationship was really bad when Mr. Muizzu came to power; now it is stabilised. So, I think that is the way it will happen. Even in our neighbourhood, ups and downs will be there, but I think it is fairly well-positioned in its neighbourhood.
RS: That’s great. So, I think we can conclude that President Xi Jinping is not losing power and his position is very strong in China. On a final note, are there any recommendations you would like to give to improve India’s relationship with China, or anything you would like to suggest?
SLN: See, China is a neighbour. You can’t wish it away; you ought to live with them. You can’t wish away a neighbour, and they’re a large neighbour. And so, to that extent, I think you need to understand that particular aspect.
Given three or four preconditions. One is, the peace and tranquillity along the Line of Actual Control has to be maintained, and that is not saying that the boundary issue should be resolved. It is far less than what they are expecting.
And the second thing, of course, our Foreign Minister and others have been on record saying that we should follow the three mutuals. Even the Prime Minister mentioned it recently in the G-20 when he was meeting the Premier. Three mutuals: mutual respect, mutual sensitivity, and mutual interest. So that needs to be maintained.
The third thing is, there should be a level playing field. Like for example, there’s always been a complaint that Indian companies do not get adequate support in China to enter and do business out there. So, there needs to be a real level playing field, and we have always been talking about mutual and equal security.
So if these four conditions are met, then there are a lot of things that one can do. If you just go check during our Prime Minister’s visit to China in 2015, what has been agreed upon, and look at the Wuhan Summit, look at the Mamallapuram Summit, and other places where things have been agreed upon. I think there are a lot of things that one could do, provided those preconditions are met. So, I think that is probably the way we will look at it.
RS: Right. Thank you, General Narasimhan, for these great and wise insights. We learned a lot today about India and China, and also about the power position of Xi Jinping in China.
Lt Gen S L Narasimhan is the Adjunct Distinguished Fellow for China and National Security Studies at Gateway House.
Raveena Shivashankar is the website and digital media associate at Gateway House.
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