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Despite repeated warnings from the US, the European Union’s recent Comprehensive Agreement on Investment with China raised eyebrows across the world. And even Donald Trump’s parting shot was to revive the trade pact with the Beijing administration. Australia also signed a 15-member Regional Comprehensive Economic Partnership with China in November. In a slowing economy, all three have revived some level of trade relationship with China. But as countries scramble to find new partners and new trade pacts in the wake of Covid, India is looking at a future where there is no China because of border tensions, and instead has lined up a few minilaterals whose outcomes are unknown.

It seems that China is able to impose itself as a critical business partner even at a time when countries have been grouping up against its increasing belligerence under the Xi Jinping administration. India has been a rare exception in maintaining a consistent stance against China in terms of trade, blocking Chinese investment in April last year and walking out of the RCEP in November 2019. This stance has been bolstered by the Ladakh standoff.

What it means is that while leading countries that are part of the large-scale and complex global value chains and supply networks have begun to find ways to do business with China, India will be the only country to be left out of all such trade and economic blocs or groupings.


Also read: A year after Covid, China’s economic growth accelerates as rest of world struggles


Warming up to China?

Just as the world was busy wrapping up the tumultuous year of 2020, Europe silently went ahead and signed the Comprehensive Agreement on Investment (CAI) with Beijing, throwing caution to the wind while making it clear to the world that for pragmatic Europeans, business comes before geopolitics.

The CAI seeks to replace 26 existing bilateral investment treaties between EU member states and China, and establish a uniform legal framework for EU-China investment ties.

This comes close to the incoming Joe Biden administration’ clear indication that it will make America re-enter the Trans Pacific Partnership (TPP), now known as the Comprehensive and Progressive Trans Pacific Partnership (CPTPP), which was originally backed by the Barack Obama administration before the Trump administration withdrew from it in 2017. But just before his exit from the White House, Trump signed a trade pact with China after being engaged in a trade war during much of his tenure.

While it certainly won’t be easy for the Biden administration to complete the CPTPP deal, once done, it will make the US party to a humongous trade pact, which is pegged to be the world’s largest free trade deal.

The CPTPP, which was signed between 11 countries creating a free trade area in 2018 after the US’ exit, may soon have Europe joining it. The UK, post Brexit, is also planning to be part of the grouping.

Last month, Australian High Commissioner to India Barry O’Farrell told ThePrint in an interview that Canberra has joined the RCEP despite its differences with China because it supports open markets and encourages expanded trade and investment. “We also recognise trade and investment will be key to rebuilding our economies post Covid, and ensuring future sustained economic development,” O’Farrell said.


Also read: US offer to help fight China at LAC aimed to ‘accelerate India’s rise as Major Defense Partner’


What India is focusing on

In April 2020, shortly before the ongoing tensions in Ladakh first cropped up, the Narendra Modi government took several steps to restrict foreign investments from China. New Delhi completely shut the door for Chinese investors or for any preferential trading arrangement with Beijing. Earlier this month, outgoing US Ambassador to India Kenneth Juster, in his farewell speech, sharply highlighted rising trade barriers in India, saying that during his tenure, he experienced most “frustration and friction” in the US-India bilateral trade. He also made it clear that in order to become a credible manufacturing hub and to become an alternative to China, New Delhi has to undertake some serious measures.

“As US and other companies find it increasingly difficult to operate in China or seek to diversify away from Chinese-led supply chains, India has a strategic opportunity to become an alternative destination for manufacturing in the Indo-Pacific … To fully seize the opportunity, the Indian government may well need to take further action,” he said.

India’s top three trading partners – the US, EU and China – slammed New Delhi during a trade policy review at the World Trade Organization (WTO) held from 6-8 January in Geneva.

The US, in its feedback to the WTO on India’s trade policy, said that if New Delhi continues to raise its tariff structure, it will “not facilitate India’s further integration into global supply chains.”

And so, India is now trying to become part of the post-Covid supply chain network by joining certain small groupings in the form of ‘minilaterals’ under the Indo-Pacific strategic initiative.

Minilaterals are quintessentially ad-hoc trading arrangements depending on the existing scenarios. They are voluntary setups and not legally binding, unlike large-scale trade pacts. Minilaterals are viewed more critically in trade parlance compared to multilateral trade agreements. Since there is no legal basis to minilaterals, countries are not bound by common trading norms or a certain prescribed set of rules, which can become a cause of friction if anything goes wrong.

And with a weakening WTO, the scope of the multilateral body, to oversee these minilaterals in terms of trade disputes also becomes minimal.

One such example is of India, Australia and Indonesia joining hands to create a minilateral, although it remains to be seen how much it will benefit New Delhi in the long run since both Australia and Indonesia are already part of the RCEP and thus have a free trade arrangement between them.

India is also part of a supply chain network with Japan and Australia but the real outcome of these arrangements can only be ascertained when trading arrangements such as the CPTPP, RCEP and CAI become activated.

Meanwhile, the neighbourhood has also kept India on the tenterhooks for not moving ahead effectively on the business and economic initiatives that have been led down under the SAARC or BIMSTEC.

Views are personal.

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52 COMMENTS

  1. I am tired of reading China a super power about to surpass USA in Indian news papers. EU has 350 millon habitants & 19 trillon GDP, USA almost equal, China 14 trillon GDP with 1300 millon habitants, Germany 5 trillon GDP with 82 millon habitants. ¡ Gotcha ! China has a long long way to catch up in science , discoveries , civil freedom, NHS and pension scheme , this is a gap China cannot overcome alone which the chinks ignore.

  2. Europe can not digest rising India, but fact is India is rising and will rise continuously. Compare GDP of India to europian nations. India in recent years showed it’s muscle in technology, economy, military, space etc. India may not compete China at the moment,but it defeated the many nations of Europe in power. India will be leading power of the world, wait and watch

  3. India is still stuck with most of the populist, insular, socialist policies inherited from successive Cong govts, which is the result of its long history of foreign domination. The problem is that this policy has retarded, stunted and stymied her industrial development, leaving her unable to compete with countries like China, which strategically embraced foreign investments with open arms, along with the attendant transfer of technology. Until India’s economy matures along the lines of China, it will have to play second fiddle and settle for whatever crumbs are left over.

  4. Nice try to promote China…
    The world has seen what it did to Jack Ma.. And his Ant group…
    I read this opinion with a pinch if salt as it comes from Mr. Basu who would most likely been growing up with bengal’s political ideology.

    But a trading strategy with China is beyond a opinion piece..
    Now coming to Print as a journalist..
    1) I guess for a balanced feed back you should have a display of 👍,👎 side by side for voters to choose from
    2) journalism like any other profession needs an investment and it sure comes by subscription…
    But then claiming that good journalism needs to be paid for gives a totally different image…
    As such your choice of writers and the topics you choose and position you take stands unabashedly left leaning… With a claim like this do you think you would be able to get past an ardent left reader to subscribe??

    It means either you don’t care for the others or you just ensure the number of Likes keeps increasing

    • Are you still on weeds? If no one is willing to do business with China, how come it’s the only growing economy after Covid this year. International data and figures won’t lie.

  5. It is not a correct opinion. Based in favour of China. Mind you this type of opinion was given before Belt and Road scheme. Look at countries now what state in debt trap with China. This is a cunning fox opinion. Go tell that to your children.

  6. There is a group of people who want to always want to bed with India’s adversaries. They make a living by doing this. Their preferred method is peddling internal strife in India and bad mouthing India through their writing and talks. They call themselves intellectuals.

  7. Brilliant, and a very astute synopsis on the current and rapidly changing geopolitical situation ! Author has been very honest in highlighting the current issues that India is confronting with. Through this article, author had only been trying to draw attention towards the fact that there exist an opportunity for India and there is a need to capitalise on this moving forward strategically considering the constraints it has.
    Some of the comments on this article clearly demonstrate that we lack the will to take criticism positively and work towards finding the way forward considering the facts and figures.
    India’s weakness and strength both lies in its massive population and there is need to act strategically to convert this into opportunities now because of the rare and unique geopolitical situation. Current government is honest and committed to bring prosperity and peace to its people. However, it is not going to be comfortable journey and people of India need to understand this.

    • Once a donkey wears a curtain over his eyes, it’s impossible to make it see the light of the day!
      Most of the bhaktas are now incapable of thinking. European Union had already entered into a mega deal with China. Other countries are it’s way. But instead of discussing any strategy to enhance our visibility and trade deals, bhaktas start abusing the author. I am sure this Govt has admitted only bhaktas as their thinkers(!) resulting in such poor strategies.

  8. It is immature of the author to compare Europe and India. Our problems with China is compounded by the fact that we share a land border. The range of issues between India and China are far different from those between Europe and China. But I guess it is just another of those authors with starry eyes about Communism

  9. With all these trade pacts that China is in, who stands to gain the most? Similar opinions had floated when India refused to join in BRI. It does not seem have impacted much, rather its is the BRI participants who appear to be in trouble and the whole initiative seems to be going elsewhere. Thinking further, it is the mini laterals that would deliver results since they are need based and voluntary.
    So far, India had dealt the affairs such as trade and foreign relations based on some principles. No need to waver and stay course. This should be reaping the desired results in the long run.
    Time and again, it is proved beyond reasonable doubt that China suffers a trust déficit. India had tried to work out patiently for decades, but in vain. It is not prudent to go closer again.

  10. If this is true and the author is criticising India for it, then hope she wouldnot write anything about human rights violations or MSP etc — they don’t matter.

  11. Shame on print. One of travesty of media which is supposed to be a pillar of democracy is that it is biased and sold. Shame on journalism. Just print something

  12. Absolutely the Move of India is in right direction as Every FTA unions are blaming India as it has commited a Disaster in open market supply & demand chains, As INDIA has recognized that being a RCEP member for so long period when did this was helpful for Indian market & Economic growth! As Largest democracy is on Transition on every aspect and Free trade economic and keeping the Trust among these Members of Minilaterals instead just following Defacto Asian Dragon is quiet meaning ful it’s upto the Nation’s in the region to strengthen A faithful Nation or Expansionist nation as Western forces has a unique ability of Artificial intelligence of Faking Nations and fooling the people & region in Name of Business& Trade is Unacceptable by Sub continent!!

  13. We are in a long haul and can not afford to loose our heart at such things if we aspire to be a power to be reccond with and not to be treated as a second grade developing country which we choose to accept for many decades.
    We have the market, the technology, the natural resources, the spirit of enterprise and ability for hard work and now the national will also under the current leadership. Moreover we have been pushed to the wall and have limited choices- to stand up or forget about aspiring to be a power which we richly deserve to be.
    Should we forget the sacrifices of earlier generations. They could also have buckled under British acrocities and forgot about sacrificing for freedom. We have to now fight for our economic freedom and rightful place in the world. What if we do not get the latest cell phone or a swanky limousine, is it too much to ask for our national honour and for a better future for our future generations. It is now or never. Let us go for it. Regards

  14. Every country has its own economic policy. India’s action plan may not be aggressive but it is steady with well thought strategy. Country may have faith with own plan without comparing with china.

  15. Do you have solutions are will you rehash problems and challenges India faces? Even an intelligent 6th grader knows what India’s problems are and how tough the neighborhood is. Publications like “The Print” if they are responsible and not left wing megaphones should come up with solutions that are feasible and workable. Not just hit pieces. Now Congress was in power in the last 60 years. How comes these issues still show up? Any honest opinions. Begging and Surrendering to China is not the solution. That is what Nehru did, even though he had great vision and thoughts for the country. We need to stand-up to the bully, may be it means some economical suffering in the short term. Resilience comes through character not just by shifting stances and political opinions like the left does. They had enough opportunity in Independent India to solve bigger problems and all the left brigade did was to bungle up and play caste and class politics in all the states it ruled and in the center where it constantly supported congress governments. Losers claiming to intelligent thought leaders now.

  16. Author seems to be bias towards China. It’s not that World will completely stop trading with China and all the trade will shift to India either. What has happened is that China has learnt the lesson very dearly and has lost some good of good trade partners like US n india. India has grown for better to Good where as China gone down to good to Bad. Author must go thro the stats before venting his emotions here

  17. I feel this article has been written under Chinese sponsor ship. We know China builds opinions in India by sponsoring articles and does many things. There is no dearth in India for China Lovers. This is a fitting article to be published in Global times.

  18. Simple – when we were subsidizing agriculture and mollycoddling labour unions China was building factories. Now we abuse Ambani-Adani who create jobs in the country.
    We’re doomed to stay a poor country with a small 1-2% of sliver of population employed in high-technology/high-productivity related work, and rest 98% mooching off state subsidies.

  19. print we know u r anti modi . eu is junk they dotn habe food to eat except for defence we dont need anyone for anything all tganks for your so callled congress era who dragged us back now media like you are putting news like this have some shame man it is our country and our govt if you cannot do anything worthful atleast be quite dojt hinder the growth happening . u are eating our food have some loyalty man. i dont know after eating congress buscuits for so long u habe even left u r self respect

  20. not surprising at all. china is dictatorship and can do whatever they want. here in india a mob of 3000 can hold the govt. to ransom fully supported by a belligerent supreme court and stop any law which most of the economists agree it is good for the country. how can you expect india to do any good at all under these circumstances?

  21. The articles in The Print are always nauseating, bizarre and against the spirit and scope of Indian government,it’s policies and intent to raise our people’s living standards.But never dwelling on the corrupted government of the past decades.So much for the intelligence by design and/or default by The PRINT

  22. The Print is Congress and leftist leaning dispensation that thrives on Modi hatred and disinformation. Therefore, you cannot rely on this write-up that is prejudiced and coloured. Fuck off you cheapskate.

  23. The Print is Congress and leftist leaning dispensation that thrives on Modi hatred and disinformation. Therefore, you cannot rely on this write-up that is prejudiced and coloured.

  24. Paid article.. the print publishers survive on China’s content.. I never seen any article in favour of India or against china.. may google only recommended those to me from this publisher..

  25. The point about Hitlers appeasement in 1939 by Europe especially Great Britain is very well taken.Today for getting acccess to the 1.3 billion market the world is ignoring China’s belligerence and repressive political system.An appeased China will only be emboldened to become a threat to open and democratic societies.A point in time will come when China will try to foist its authoritarian political system as the viable alternative to democracy, in fact it has already started doing so. Unless put under pressure from democratic govt.s of the world to be come a more representative society by restrictions on trade and business,the CPC will never shed its arrogance and agenda to domunate the world.

  26. India and china should burry the differances and solve the tensions, between them.
    All the soldiers on either side and their families should be relieved and bring progress to all.
    Enough is enough at the boarder

  27. Not sure if India is left out. It’s mostly India itself that refuses to join. After all not signing on to the RCEP was India’s decision. Also not sure India’s neighbors keep it on tenterhooks or it’s Indian obstinacy on free trade that keeps them on the edge.

  28. India is a disposable pawn of Japan and partly USA. Japan knowd in future China will take revenge for millions it raped anf killed. Indians will beused to prevent that. Super racists Japan is laughing at stupid Indians. I am IIT graduate who was forced to go to Japan and got harassed. My Kindle.

  29. While on one side, India is standing up to highhanded attitude of china (US is another country) the current government must open up the economy without going deep into the implications. India cannot bind both the hands and just say welcome orally. If India want to stand head to head with within next few years, it has to shred protectionism. Or else it must have strong R&D infrastructure to give new products to the world. So it is necessary that India play its card carefully, rightly and timely

  30. Had India started infrastructure development , Aggriculture modernisation ,IT mobilisation from 1990 onwards like China ,by this time india could have been emerged a consistant economic global partner.
    Unlike china india has some internal problems. J and k issues .now it is made integral part after 370 removed.
    Regional parties corrupt and selfish practices creating lot of friction in india ,by this india is failing to have internal stability.
    One more issue our caste system and Dharmic intollerance also creating some friction by sort some culprits.
    With all this Modiji is having Iron fist and brave heart to tollerate and take india ahead even in coved19.
    Today india require A nation buildinging attitude. EU has shown this. Who ever comes as obstacle need a punishment.
    Nation first happens only when there is an attitude ie nothing comes free. Pay and get. Work and get all fascilities.
    Bring Asset controll act .More assets more tax. Only very poor people must get BPL cards and they follow nation population policy. Those violate code if conduct being citizens must respect constitution. If required bring suitable amendments.
    For Development and going forward like Vietnam or china India must adopt suitable action . If corruption is an hurdle bring laws to seize property and bring non bailable warrant .

  31. Western countries can never be trusted when business is concerned. They will act in their own interest & would not bother for LAC etc. Example of Australia is there begging to China for trade !!!

    • Stupid observation by Print. China has already lost its reputation and will keep on loosing Trade. India will grow n gain in times to come.

  32. In Modi’s India everybody expects instant results due to his record of project implementation and promise delivery. However, in a world ravaged by the pandemic, resources are limited as is the appetite for risk taking. Yet India’s emerging prominence is noticeable. Be patient; it takes time to catch up to a 4 decades of headstart.

  33. In Modi’s India everybody expects instantaneous fruits – that is the result of his record of project implementation and delivery on promises made. However, a world ravaged by the pandemic doesn’t have either the resources or the appetite for risk but the signs of India’s emerging prominence are visible. Be patient; it takes time to catch up to 3 decades of headstart.

  34. China can resort only to crooks ways to Garner support like this. If China is getting cosy with world trade why they r worried about trade with India. Just by writing articled thru paid news channels they are satisfied with themselves.

  35. You seems to be a Chinese paid or backed news channel. When the whole world is looking to have trade with Chinese crooks, why they r worried about India. Because without India China cannot withstand in the world trade. This is a fact written on the wall otherwise when India banned merely the Chinese apps how much hue and cry China nade and what us today’s position of those app companies. So don’t teach us. We r with the world’s good countries always and don’t budge to crooks and their stooges.

  36. The focus of govt is Winning election. For this they are emulating arabic country politics i e using religious politics. They are not bothered of anything
    So economy is in mess.

    • How u are assuming that economy in mess. China and other 14 members of RCEP partners are cursing their effort to dumping their cheap product in india with a market of billion plus population. But china thought they are great. Results are showing that their future plan of BRI is really started back firing. They money they have put is difficult to give return. Wait sometime.

  37. Even after the bitter experience of pandemic, and China’s aggressive economic wars, if the world is still ready to do business with China, it merely shows that most nations are greedy. It is not India’s failure. This was how Europe tried to appease Hitler prior to 1939 and paid with World War II. There is no pleasing the aggressive.

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