Geo-Strategic Trend - 156. page

China Economy recently reported that India’s central bank just announced an interest rate cut. This is the first time since the end of last year that an Asian central bank has cut its interest rate. The cut brought India’s interest rate to a seven-year low. Apparently, the Indian economy is facing a serious challenge. Ever since Indian Prime Minister Narendra Modi’s banknote demonetization last year, India’s manufacturing and consumer spending has been suffering major declines. The Modi administration also started its tax reform in July, which caused serious chaos in India’s supply chains as well as distribution channels. It significantly worsened India’s commercial market to its “lowest point” since the global financial crisis. Although the tax reform may have some benefits in the long run, the solution for the immediate chaos should not depend on creating a distraction by triggering military disputes with neighboring countries, which will prove to be “extremely stupid.”

Source: China Economy, August 7, 2017
http://www.ce.cn/xwzx/gnsz/gdxw/201708/07/t20170807_24836070.shtml

The well-known new Chinese news site The Paper recently reported that the Indian government started charging anti-dumping duties in 93 categories of products imported from China. The decision was made after key players in the Indian tire industry met with government officials. The 93 categories include products in a wide range of industries such as chemical and petrochemical, steel and other metal products, fiber and yarn, mechanical products, rubber or plastic products, power electronics and different types of consumer goods. India also launched an anti-dumping investigation in July on photovoltaic cells and modules from China, Taiwan, and Malaysia. India currently has a US$51 billion trade deficit with China. Indian media have been complaining about cheap Chinese products filling up the Indian market. However, reports from India’s own market study agencies showed that Indian consumers have preferred affordable Chinese products that typically are of better quality that India’s similar ones. According to the Chinese Ministry of Commerce, in the first half of this year, India became the country that had the largest number of anti-dumping investigations against China.

Source: The Paper, August 11, 2017
http://www.thepaper.cn/newsDetail_forward_1760000

BBC Chinese recently reported that the government of Sri Lanka reached and signed an agreement with China which will give China full control of the deep-sea port of Hambantota. Sri Lanka explained that, under the US$1.1 billion for 99 years agreement, China will only use the port for commercial purposes. The deal had been shelved for months due to the concern that China might use the port for military purposes. Port Hambantota sits at a critical spot that connects Asia and Europe on the Indian Ocean. According to the Sri Lanka government, the income collected can be used to pay off foreign debts. However, the plan requires moving thousands of villagers out of the region. The government promised new land for these people. Port Hambantota is an important part of China’s “The Belt and Road” grand plan. Multiple China’s trade arch-rivals, such as India and Japan, have been paying close attention to this latest development in the region.

Source: BBC Chinese, July 29, 2017
http://www.bbc.com/zhongwen/simp/world-40762012

On August 4, Haiwai Net, People’s Daily’s website targeting overseas readers, published a commentary which reiterated China’s position on the border conflict in Doklam. It warned that if India does not withdraw its troops, China will not rule out completely the option of taking military action. It stressed that for India to send troop across the border represents a very serious invasion. It alerted (India) that China will not back off from its position and will resort to all necessary measures to protect its legal rights. It warned that India should not insist on stirring up trouble for China as it will not benefit in any way from doing so.

Also on August 4, Huanqiu published an article in English. According to the Huanqiu article, from Thursday to Friday, two ministries and four institutions, including the Chinese foreign ministry, the defense ministry, the Chinese Embassy in India and People’s Daily, released statements or commentaries on the military standoff between China and India in Doklam, Tibet Autonomous Region. China urged India to pull back the trespassing troops to the Indian side of the boundary immediately and called on them to address the situation in a proper manner to restore peace and tranquility in the border region swiftly.

Ren Guoqiang, a spokesperson for the defense ministry said in a statement posted on its website late Thursday night that, “The series of remarks from the Chinese side within a 24-hour period send a signal to India that there is no way China will tolerate the Indian troops’ incursion into Chinese territory for too long.”

Hu Zhiyong, a research fellow at the Institute of International Relations of the Shanghai Academy of Social Sciences said, “If India refuses to withdraw, then within two weeks, China may conduct a small-scale military operation.”

Source:
1. Huanqiu (Global Times), August 4, 2017
http://www.globaltimes.cn/content/1059727.shtml
2. Haiwai Net, August 4, 2017
http://opinion.haiwainet.cn/n/2017/0804/c353596-31054539.html

Xinhua recently reported that Iran just launched a satellite rocket from its national space center. Reports indicated that the rocket could be used as a means to send a satellite around 250 kilograms into its orbit. The Iranian government explained that Iran itself had fully developed this rocket. The United States, along with other Western countries, has long suspected that Iran was developing missile technologies that can carry nuclear warheads – under the name of making peaceful satellite rockets. The United Nations banned Iran from building such ballistic missiles. On the same day, the U.S. Senate passed a House bill which accused Iran and North Korea of developing ballistic missiles and asked the U.S. government to impose additional sanctions on these two countries. Iran responded by saying it will take whatever steps necessary to deal with this pressure from the U.S. Ever since U.S. President Trump came into power, the U.S. has been pressing Iran using ballistic missiles as the excuse. Iran has been defending its right to develop rocket technology.

Source: Xinhua, July 29, 2017
http://news.xinhuanet.com/world/2017-07/29/c_129666596.htm

On July 28, VOA published an article in which it stated that there are indications that China is softening its position against India over the recent stand-off at the China India border. On July 28, Xi Jinping met with representatives from BRICS (an association of five major emerging national economies: Brazil, Russia, India, China and South Africa). Ajit Doval, India’s security advisor was among those representatives. According to China’s official media, Ajit Doval was said to be the person that ordered the Indian troops to the border. Per the media from the West, he is considered to be the most influential political figure next to Prime Minister Narendra Modi. In the official press statement following the meeting, there was no mention of the military stand-off in the Doklam region. On July 25, Xinhua published an analytical article on its English website which praised Prime Minister Narendra Modi for his active promotion of India’s foreign policy reform and stressed that, “China-India cooperation helps promote open global trade and counter protectionism.” The Times of India said on July 27 that the Chinese government obviously thinks that India is an important market for China and that military conflicts between the two should be avoided. The article also mentioned that, at the press conference, the spokesperson for China’s Ministry of Foreign Affairs appeared to avoid harsh words towards India except that China still insists that India must withdraw its troops from the border. The VOA article went on to quote an interview with Jeff Smith, a scholar at the American Foreign Policy Council, who told VOA that China has used so many aggressive words on the issue that it has pushed itself into a dead-end. He said it will be very difficult for China to back down from its position gracefully. “China is unlikely to gain from the border standoff with India as the road it was building in the Sikkim sector’s Doklam area leads to nowhere and the move would push India closer to the U.S. and Japan.” The article further quoted the speech that Jeff Smith gave during a forum held in Washington D.C. on July 27.

Source: Voice of America, July 28, 2017
https://www.voachinese.com/a/xi-jingping-meets-india-nsa-advisor-20170728/content/article/3963602.html

Well-known Chinese news site Sina recently reported, based on a number of media sources, that Palestinian President Mahmoud Abbas visited China in the third week of July.  Chinese President Xi Jinping proposed China’s solution to the Middle-East conflicts. Xi described China’s Four-Point Proposal, which includes the Two-Nation political solution, a common, comprehensive, cooperative and sustainable security stand, an extended and coordinated international push for peace, as well as a Palestinian-Israeli joint effort for economic development that assists political negotiations for peace. Xi also called for a swift start of the China-Palestine-Israel Three-Way Dialogue to coordinate and push forward the critical projects for aid to Palestine. Palestine is part of China’s “The Belt and Road” grand plan. Abbas confirmed the “real gold” friendship with China, praised the Chinese peace proposal and promised an active Palestinian participation in The Belt and Road movement.

Source: Sina, July 19, 2017
http://news.sina.com.cn/o/2017-07-19/doc-ifyihrwk1361720.shtml

At the First Trade Fair on Syrian Reconstruction Projects (on July 9), Qin Yong, Vice President of the China-Arab Exchange Association, revealed that China plans to invest US$2 billion in Syria to establish industrial parks. The first phase will attract 150 enterprises to participate.

Syrian ambassador to China, Imad Mustafa, said that this is the first time that a Syrian reconstruction project fair has been held in Beijing. The hope is to build an important platform for Chinese enterprises to understand Syria and participate in the reconstruction of Syria.

The Syrian ambassador also said, “China, Russia, and Iran have provided substantial support to Syria during the military conflict. Therefore, it is these three countries that should play a major role in the reconstruction of Syria. If the work were to be carried out by other countries, even by those who participate in the damage to the Syrian infrastructure, it would be very unfair.”

“We learned the lessons from what happened (during the domestic war). We learned who our strategic partners are. Now we will not move closer to the West, but to the north and the east (referring to China, Russia and Iran).”

Source: Sina, July 14, 2017
http://mil.news.sina.com.cn/china/2017-07-14/doc-ifyiakur8888497.shtml?cre=milpagepc&mod=f&loc=1&r=9&doct=0&rfunc=49