'With China's rise in South Asia, India's neighbours have greater demands'

China’s activities in South Asia are both visible and opaque, competing in a space India used to dominate. In an edited report that covers different aspects of Beijing’s engagement with South Asia, Constantino Xavier, senior fellow at the Centre for Social and Economic Progress, and Jabin Jacob, associate professor, Department of International Relations and Governance Studies, Shiv Nadar Institute of Eminence, say India needs to build strategic capacity to better assess demand from neighbouring countries and then deliver on time. Aditi Phadnis caught up with them in an interview partly on email.

 

Your latest report “How China Engages South Asia: In the Open and Behind the Scenes” is out. What are its findings?

 

The 12 case studies show that China is expanding the themes and number of partners it is engaging as well as building on its tools to enhance influence across South Asia. It is openly competing in a space where India’s role used to be predominant. Beyond the hard and more visible dimensions of trade, investment, or defence supplies, we show that China’s engagements also operate on softer dimensions that shape the governance, including legal regimes, politics, and perceptions in countries like Sri Lanka, Nepal, and Bangladesh. These aspects tend to be neglected in daily analysis but are important to study if we are to gain a better understanding of the long-term Chinese strategy to build influence and capacity in South Asia. These efforts and investment by Beijing can be leveraged or even weaponised one day with obvious economic, security and political implications for India in a rapidly changing and not always friendly or cooperative neighbourhood, from Afghanistan and Pakistan to Bangladesh and Myanmar.

 

Whether scholarships, political-party exchanges, heritage conservation, regulatory design, conflict mediation or covert influence operations, the pieces align with each other and contribute to a broader Chinese endgame. Even when faced with obstacles, China is quick to learn lessons, deploy new instruments, or to engage more actors. A case in point is how it engages Nepal’s northern border provinces. We observe a China capable of quickly adapting its tactics and becoming increasingly experienced and comfortable engaging with diverse political systems and actors in South Asian — civil society, political parties, media, academia, religious associations, industry, etc.

 

We argue there is much that India and other actors can learn here in terms of diplomatic strategies and range of engagements. The fundamental requirement, however, is specialized knowledge on the political, economic and social landscapes of these countries. The Chinese have been doing this for years, through language and specialised training, as well as targeted outreach to stakeholders in various sectors.

 

Isn’t it true that there’s also pushback from many South Asian countries? For instance, in Nepal in the past decade, while many districts had begun offering school-level instruction in Mandarin by Chinese teachers, these teachers have since had to leave for lack of demand. There is also anecdotal evidence that many Tibetan-financed Buddhist temples are also coming up. In short, while there is greater Chinese engagement, there are also limitations to it….

 

Yet, limitations to Chinese influence exist. South Asian countries are not passive bystanders to China’s engagement strategies. In some cases, we see them courting, pulling Beijing in, whether to support their developmental ambitions or to increase their bargaining power with India. Nepal under Oli, Bangladesh under Hasina and Yunus, Sri Lanka under the Rajapaksas, and Maldives under Yameen and Muizzu have all played this balancing game with mixed results. And that explains the shifting tide you describe: While China remains a popular partner in the region, it is no longer seen as the ever benign saviour and heroic solver of all problems.

 

For instance?

 

China was missing in action during the Sri Lankan financial crisis. Its BRI (Border Road Initiative) project deliveries in Pakistan, Nepal, and Bangladesh are limited in terms of both quantity and quality. And with the arrival of Chinese state-owned enterprises and other actors, stakeholders in South Asian countries have begun raising concerns about Chinese development and governance norms, including conditionalities. Yet while the Chinese grass across the Himalayas does not look so green anymore, decision-makers in the region continue to face limited choices and are still banking on Beijing to deliver on assistance and solutions, especially as other traditional partners from the West are disengaging.

 

Does the success of Chinese engagement mean India’s “neighbourhood first” policy needs a reset?

 

Our other studies show that in terms of volume and levels of engagement across the neighbourhood, except for Pakistan, India is today delivering more, better and faster than ever before, except maybe for the 1950s. But this is a very different neighbourhood today, far more open and competitive, placing unprecedented demands on India and other powers.  So in relative terms, India’s delivery capacity is still not good or fast enough: With China and other actors rising as an alternative, India’s neighbours also have greater demands from it. They now expect India to deliver faster and more substantially whether it is on trade facilitation and energy interdependence, digital and technology solutions, or connectivity infrastructure to develop roads, railways and ports. Rather than resetting or redefining policies, India will have to build strategic capacity to better assess demand from neighbour countries and then deliver on time: This is where there are some lessons to be learnt from our case studies on China.

 

From the Dalai Lama to Sheikh Hasina, and militant Tamil leaders in the past, India has acted host to leaders (and governments) in exile and has become a factor in the domestic politics of foreign countries. Is China going down the same road?

 

After a relative lull in Chinese intervention in the domestic politics of other countries, Beijing is back to the practice — even if its approaches and objectives might be somewhat different from the Maoist era. As a party-state, China under the Communist Party has ideological objectives in ensuring other political systems and norms align with its own. And increasingly, China is demanding such alignment, given its competition with the United States (US) and with those it sees as aligned to the US like India. This explains, for example, China’s desire to mediate in various internal and external conflicts in the region such as in Myanmar now or in Afghanistan before the return of the Taliban. It also explains China’s desire to promote party-to-party exchanges and training sessions for other political parties in the region on its own political norms and governance strategies.

 

These Chinese efforts are bound to affect the quality of democratic governance across the region, for example in terms of public accountability or the role of the media.

 

China has emerged a key player in the recent regime or constitutional crises in Kathmandu, Dhaka, Colombo and Male. This is not always the result of Beijing’s strategies: Both Yunus and Muizzu, for example, indicate pull factors or what Shivshankar Menon calls “anticipatory compliance” in hope of currying favour with China. Indeed, it is today difficult to imagine any political outcome in the region where China does not play a role, even if through inaction.