Property Interest Australia

CNN Asia

Posted: 2018-04-27 00:15:46

Original link: http://rss.cnn.com/~r/rss/edition_asia/~3/xiSF0hfl660/index.html

Billed as an "informal" summit, Chinese President Xi Jinping will host Indian Prime Minister Narendra Modi in the central city of Wuhan on Friday and Saturday, the clearest sign yet of thawing relations between the two estranged nuclear powers, following last summer's tense military stand-off in the disputed border region of the India-China-Bhutan "trijunction."

Unlike a more traditional state visit, the casual setting appears specifically calculated to avoid potentially complex policy negotiations and instead provide the two leaders, whose countries comprise more than 2.6 billion people and 17.6% of the global economy, an opportunity to clear the air.

Speaking to reporters on Monday, former Indian Foreign Secretary S Jaishankar described the surprise meeting as having no stated goals or set agenda. Conversations, suggested Jaishankar, will be "personal and interactive."

For Modi, the benefits of stabilizing relations with China are clear. Unlike his Chinese counterpart, the Indian prime minister is gearing up for reelection next year. Though Modi remains overwhelmingly popular among voters, a potentially bruising encounter with China, especially one that involves the two countries' armed forces, could see his poll numbers dented. By meeting with Xi, Modi can both help to mitigate that risk, while simultaneously opening up the possibility of increased economic cooperation at a time of global uncertainty.

For Xi, the summit comes just months after term limits on the Chinese presidency were removed by the country's rubber-stamp parliament, effectively allowing him to govern for life if he chooses. Xi's consolidation of power clears the way for him to embark on a bold new period of statesmanship. The prospect, however unlikely, of the region's two major powers agreeing to join forces, would signal a significant geopolitical shift and the type of major policy win befitting Xi's new status.

That Xi is receiving Modi on the same day as the leaders of North and South Koreas hold talks has raised eyebrows, but analysts view the timing as coincidental and not meant to overshadow the inter-Korean summit, especially considering the difficulties in scheduling and preparing for meetings between any senior leaders.

"Xi has had his meeting with (North Korean leader) Kim Jong Un," said Duncan Innes-Ker, regional director for Asia at the Economist Intelligence Unit (EIU), suggesting people not read too much into the timing "given that the Chinese side has lined up its ducks when it comes to the coming Korean summit, and India is only tangentially interested and involved in the Korean situation at best."

'Unprecedented changes'

"As the leaders of the two largest developing countries, they feel that the two countries need to communicate in great depth on some long-term, comprehensive and strategic issues embedded in bilateral relations and international affairs," Chinese Foreign Ministry spokesman Lu Kang told reporters Tuesday.

It's no coincidence that Lu chose to underscore that the meeting, the Indian Prime Minister's fourth in China, would take place "in the face of unprecedented changes in the world today."

A trade war currently looms large over China and the United States. And while India has found itself courted by the US as part of President Donald Trump's new "free and open Indo-Pacific" strategy, the growing threat of US protectionism hangs over the Indian economy, too.

As a result, improving weak economic ties are likely to be a top priority within any attempt to reset bilateral relations.

Although China is India's largest trading partner, their $84 billion bilateral trade last year was a mere fraction of the US-China trade volume, which stood almost $600 billion.

"Realistically, China's exports to India are not going to offset any impact that might have come from a China-US trade war," said Innes-Ker.

But that doesn't mean it's not important. Pointing to an effective ban on Chinese telecom giant ZTE in the US market recently enacted by Washington, Innes-Ker said China is taking the risk of rising trade tensions with the US seriously.

"China needs access to the India market, where the Indian government has been slapping tariffs on them and imposing non-tariff barriers," he said. "It's in China's interest to get these economic issues resolved."

India too will be looking to reduce its reliance on the US, suggest analysts, who point to Trump's increasingly aggressive trade policies as a source of growing concern within Indian economic circles.

"If you're not friendly with China, the US -- especially under Trump -- will finish you off and give you a very bad bargain," said Madhav Das Nalapat, director of the geopolitics department at Manipal University in India. "If you're not friendly with the US, China will roll over you."

"So if you want a healthy relationship with China or the US, you need healthy relations with both," he added. "We need the US on security and China for commerce and trade."

Major strategic divergences

Both countries boast ancient civilizations and centuries-old ties. But in recent years, China and India have had a rocky relationship. Last summer's Himalayan standoff was the latest in a long-running series of territorial flare-ups between the two nuclear powered neighbors. In 1962, the two countries engaged in a bloody border war, and skirmishes have continued to break out sporadically in the decades since.

Other longtime sore points between the two governments include China's ardent backing of Pakistan, India's arch rival, and New Delhi's sheltering of the Dalai Lama, the exiled Tibetan spiritual leader whom Beijing considers a separatist traitor.

India's Narendra Modi to meet China's Xi Jinping as ties thaw

Economic and strategic competition between China -- a Communist-ruled one-party state -- and India -- the world's largest democracy -- has also intensified in the past few years as Beijing began to expand its influence in India's traditional backyard, especially with the launch of Xi's ambitious "Belt and Road" global trade plan.

Recent moves that have aroused strong suspicion in India range from China's taking control of a major port in Sri Lanka and signing of groundbreaking trade deals with Nepal, to its navy conducting anti-piracy operations in the western Indian Ocean.

At a press conference in March, Chinese Foreign Minister Wang Yi said the two countries' leaders "have developed a strategic vision for the future of our relations: the Chinese 'dragon' and the Indian 'elephant' must not fight each other, but dance with each other."

Analysts appear divided on such a prospect under two strong nationalistic leaders, even though many see the two men get along well at a personal level despite the vastly different political systems of their countries.

Dalai Lama caught in the middle as India and China reboot ties

"This is a recognition of both leaders that India and China are going to have to work together in order to make the 21st Century the Asian century," said Nalapat, the Indian professor. "The Asian century, frankly, is at the core of this summit."

"They are going to work hard on creating a very strong relationship, on creating oxygen that can pour down and help solve problems at the lower level," he added.

"There is a huge difference between having a relatively positive personal relationship and having a productive strategic relationship," said Innes-Ker of the EIU.

"The underlying story is that this remains an antagonistic relationship and the strategic tensions will far outweigh any common ground that they find between each other."

CNN's Sugam Pokharel contributed reporting from New Delhi.