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India, China Face Trade Choices

November 3, 2016 • GLOBAL ECONOMY, China, Dan Steinbock, India

By Dan Steinbock

In the coming years, China and India must decide whether their bilateral ties will be based on economic cooperation, political facilitation and strategic trust or economic walls, political barriers and strategic containment.

 

In early October, militants attacked an Indian army camp in Indian-administered Kashmir, killing a soldier. In this contested region, the two nuclear powers, India and Pakistan, have occasionally been close to devastating military friction. In the mid-October BRICS Summit, India’s Prime Minister Narendra Modi called Pakistan “mother-ship of terrorism”.

However, fringe groups went further and a unit of the Indian right-wing Hindu nationalist organisation, Vishwa Hindu Parishad, torched a pile of 200 Chinese-made electronics in West Bengal. For now, opportunistic political attacks remain marginal but there are concerns that determined fringes could aim higher. In turn, these efforts are compounded by past mistrust on the quality of some Chinese goods, and deliberate hoaxes.

Today, China is India’s largest trade partner. However, New Delhi has a huge trade deficit with China, which many Indians also perceive as the key partner of Pakistan.

How serious are these threats to boycott, ban and embargo Chinese products by Indians?

 
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About the Author

dan-steinbock-web Dan Steinbock is Guest Fellow of Shanghai Institutes for International Studies (SIIS). This commentary is based on his SIIS project on “China and the multipolar world economy”. For more about SIIS, see http://en.siis.org.cn/ ; and Dr Steinbock, see http://www.differencegroup.net/


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