On 21 April 2020, India approved a set of new financial regulations subjecting FDI from countries that it shares contiguous borders with to government approval. Targeting China, the decision also applied to foreign entities looking to invest in India in which Chinese firms have already invested. New Delhi has signalled that, following the coronavirus pandemic, European and North American firms will face a fairly straightforward choice between India or China. Criticised by China as “discriminatory”, the move came amid similar changes in financial regulations in Italy, Australia, Germany, Canada, Spain and other countries, signifying two things. One, that Chinese foreign policy will become increasingly aggressive as it recovers from after-effects of the post-Covid economic recession. Two, that the mistrust of China by several nations given its apparent cover-up of details surrounding the coronavirus’ emergence has now translated into outright hostility that will manifest geopolitically following the pandemic. Such an environment provides India with abundant opportunities to partially diminish Chinese international influence or at the very least strengthen her own position as a potential global power – especially in Europe, Southeast Asia and in the Indo-Pacific.
Weaponisation of Investments
Using Huawei Beijing had hoped to expand a 5G network across Europe and the world for intelligence. Along with the Xiaomi’s investment in London’s radio cabs, these examples serve as a case study of China’s weaponisation of financial investment as a tool of geopolitical influence-gathering purposes. Due to Covid-19, this has come under increased scrutiny from Britain and France, in particular, who accuse China of having covered up details regarding the coronavirus. Suspicions regarding Huawei’s 5G infrastructure predate the pandemic – MI6 director Alex Younger had expressed his reservations in December 2018 itself. Similarly, France has denied Huawei permission “to erect 5G antennae close to the Paris headquarters of the Ministry of Defence.” French intelligence agencies suspect that Huawei’s activities would allow China “to freeze 5G networks in the case of conflict.” The coronavirus pandemic has only exacerbated such criticism. The British Parliament’s Foreign Affairs Select Committee chairman Tom Tugendhat – a Tory MP and ex-intelligence officer – has accused China of “deliberately falsifying data” about the virus from the outset amid speculation that Whitehall aims to turn China into “a pariah state” due to such apparent misrepresen-tations. The pandemic and the subsequent anti-China hostility generated in Whitehall may force prime minister Boris Johnson to overturn his January 2020 decision allowing Huawei permission to help build Britain’s 5G network and operate unsupervised on 35 per cent of it. MI5 and MI6’s call to “ensure diversity of supply in 6G and 7G” while protecting Britain’s “‘crown jewels’ of technology, research and innovation”, coupled with news regarding a rapidly-growing hardline anti-China faction within the Conservative Party may compel Johnson to take measures against Huawei. French president Macron has also posited the possibility of a Chinese cover-up, remarking in an interview that “there are clearly things that we don’t know about.” France’s growing belligerence was visible in March 2020, when despite the pandemic, the French and Indian navies conducted joint patrols in the greater Indian Ocean Region (IOR) from Réunion Island. It was Paris’ signal that it was willing to intrude into China’s sphere of influence in response to Beijing’s smokescreen politics.
Franco-British hostility towards China in the coronavirus’ context therefore translates into strategies targeting Huawei. Evidence also suggests that given the prevailing sentiment, British authorities in particular are looking for alternatives to Chinese 5G technology, which remains a necessity as British cyber security experts warn of “economic and social risks” of deliberately ignoring 5G.
Opportunities for India
Labour Party leader Keir Starmer’s comments that Kashmir “is a bilateral issue” between India and Pakistan and that any constitutional changes regarding the state’s status are “a matter for the Indian Parliament” are as much an attempt at winning back political patronage from the influential British-Indian community as they are a veiled jab at Beijing, given his noticeable omission of any reference to China – which also claims the Aksai Chin region of the former state and had criticised Article 370’s revocation as “unlawful”. India’s sale of paracetamol tablets to Britain may, therefore, be read as an attempt to capitalise on such sentiment. Regarding 5G, while India may not yet have any reliable suppliers of such technology, the government is attempting to facilitate joint ventures between Indian and non-Indian firms to exert greater geopolitical influence worldwide. This policy may later enable Indian companies’ entry into Europe’s 5G technology market, publicising themselves as viable alternatives to Huawei. Union Minister Nitin Gadkari’s exhortation of Indian firms to “encash the golden opportunity” provided by the pandemic to enter into such joint ventures with firms currently exiting China, as well as his promise to provide required permissions “on a war footing” appears to signal that the government is working towards pursuing this line of action. The government’s support for such joint ventures would bring approximately Rs 20-25 lakh crores into India’s manufacturing sector while diminishing China’s power as a global manufacturing hub. At the same time, it is worth keeping in mind that Indian wireless and telecom companies are also building up a base in the UK and can use the lull in investment triggered by the coronavirus to formulate new policies to expand their – and India’s – geopolitical reach.
Dealing with Protests
The pandemic provides China with a convenient distraction to crack down harder against Hong Kong’s anti-Beijing protestors. The arrests of prominent anti-China figures in mid-April 2020 suggests that Beijing is taking advantage of the lull in protesting caused by the coronavirus lockdown to enforce its will in the city-state. However, signs of the curve flattening in Hong Kong in late April have encouraged further protests such as the occupation of Landmark Atrium Mall, reflecting rising hostility against China amidst Covid-19. China’s heavy-handed response in a city that was considered during the 2018 US-China trade war to be her interface with the global economy signals to Washington that following the pandemic, it will no longer need to rely on third-parties like Hong Kong, flooded with Western financial investment, to wield economic clout. Actions in Hong Kong are also aimed at warning Taiwan, whose airspace was encroached upon twice by Chinese fighter jets in 2020. Writing in 2016, British journalist Tim Marshall noted that Beijing was “playing the long game” by wooing Taiwan. He argued that one of the reasons why authorities “did not batter protestors off the streets” during the 2014 Hong Kong protests was because “the world’s cameras were there and would have captured the violence”– footage of which would have been viewed by Taiwanese audiences possibly “asking themselves how close a relationship they wanted with such a power.” The CCP’s current response to the coronavirus-fuelled hostility it faces today in Hong Kong indicates that it has dispelled with such notions.
South China Sea
China’s actions in the South China Sea/East Asia seemingly predict such an aggressive Chinese foreign policy. In late April 2020, Australian and American frigates moved into a part of the South China Sea within a part of Malaysia’s exclusive economic zone – where a Chinese vessel was conspicuously deployed. Washington and Canberra’s actions reflect their growing anti-China hostility, especially following Australia’s call for an international enquiry into the origins of the coronavirus in China. China has also used the distraction of Covid-19 to provoke countries such as Vietnam as a premonition to her increasingly aggressive post-Covid geostrategic policy. In early April 2020, a Chinese vessel sunk a Vietnamese fishing boat in a Vietnamese-claimed area of the Paracel islands, and in May 2020 published new maps with renamed underwater landforms lying close to Vietnam. Hanoi responded with a Vietnam-affiliated hacking group called APT32 which attempted to “compromise the personal and professional email accounts of staff at China’s Ministry of Emergency Management”. In South Korea, the pandemic has re-ignited dormant anti-Chinese sentiment among the public that may find expression in domestic politics.
Implications for India
While the expected post-Covid global recession will most likely dent China’s economic clout/its geopolitical standing, the rising hostility towards Beijing in East Asia and the Indo-Pacific is likely to result in China growing even more belligerent. China’s actions in this part of the world should hold great significance to India, given that the developments lie directly in India’s vicinity. Additionally, the developments also provide a taste of what a aggressive China may look like foreign-policy wise following the pandemic, allowing our policymakers to better prepare for such an eventuality.
All this has major security implications for India. India has already attempted to market herself as the antithesis to China in Southeast Asia by agreeing to sell hydroxy-chloroquine (HCQ) to Malaysia, where her exertion of soft power is presumably an attempt to gain strategic influence in the Straits of Malacca region- a choke-point which China depends on for the free passage of its trading ships. That India has started ordering cheaper Covid-19 testing kits from SD Biosensor, a South Korean company also signifies India’s eagerness to capitalise on the rising Covid-fuelled anti-China sentiment in South Korea to possibly expand her influence in the Korean peninsula. India’s rejection of faulty Chinese testing kits soon after appears to partly indicate this. Vietnam, which has called for India to step up “efforts to strengthen peace and stability in the region” by taking a harder anti-China line, has been included in a proposed US-backed coalition that also includes, among others, India, Japan and Australia and is aimed at “restructuring supply chains” – implying a broader American policy to counter China’s expansion of the Belt and Road Initiative amid anti-China hostility fuelled by Covid-19.
While such developments might allow India to expand her geopolitical clout at China’s expense, they are also fraught with complications. The mass trial of an app-based digital currency, the “e-RMB” is possibly Beijing’s attempt to prepare for a potential scenario where it becomes completely economically self-sufficient amid possible international sanctions following Covid-19. This raises questions regarding the practicality of Washington’s abovementioned proposal. In a speech in April 2020, Australian envoy to India’s predicted that he “sees a US far more cautious about exercising global leadership than in the past” as a result of the coronavirus pandemic. Ambassador Farrell’s comments indicated that the pandemic had caused countries like Australia to have lost their earlier confidence Washington’s ability to act as a sufficient anti-China bulwark in Southeast Asia. Interestingly however, in the same speech he acknowledged India to be “the natural major power in the region” – one that “Australia looks to as a strategic partner”. Such comments indicate that Canberra has more faith in bilateral relations with a nearby power – in this case, India – than in a broad-based US-centric coalition. India should play upon both such anti-China hostility as well as the quietly growing mistrust of US policies in countries like Australia to focus on building up an India-led bloc in Southeast Asia based on bilateralism rather than American-style multilateralism.
If India commits itself to Mike Pompeo’s proposal of an alliance, it risks losing the advantage that she appears to have gained through the subtle shift in allegiance towards it from countries like Australia. While one may point towards the aforementioned Indo-French naval exercises in the Indian Ocean in March 2020 to indicate India’s willingness to position herself as Beijing’s antithesis in the IOR, one may also argue that they were simply a face-saving gesture following the multilateral Milan 2020 naval exercises’ postponement (the exercise was to be held in March 2020 in the Bay of Bengal). It is in this context that geostrategy’s importance in India’s fight against China’s new “Health Silk Road” initiative is underlined. Conducting fly-bys of Indian Air Force jets over Burmese-administered Grande Cocos Island, where China has a SIGINT facility targeting India, or possible maritime exercises – unilateral or otherwise – in the South China Sea would serve as India’s diplomatic force multiplier, especially now, thus, facilitating her exploitation of the predicted post-Covid hostility of countries towards China.
As the pandemic subsides, there will clearly be a backlash against China’s global influence. Despite India’s currently weaker position vis-a-vis China, it is currently in a strong position to exploit Covid-fuelled hostility to rise as a power capable of pushing back China’s geopolitical influence, or at least using this window of opportunity to cultivate that image. The effects of the Coronavirus are indeed tragic. Yet it is imperative that South Block’s policymakers seize the opportunity it provides to grow as a global power while combating the rise of India’s rival, China.
The coronavirus must not diminish but intensify India’s will to grow stronger, as hostilities against China strengthen its ability to fight for dominance against a similarly ancient, Asian civilisation in our unpredictable times. Following the end of World War 2, the US had established its economic supremacy and geopolitical dominance by establishing the US dollar as the global currency. Today, we see the increasing possibility of a post-Covid China challenging that hegemony. It is, therefore, high time that India uses its various geopolitical levers to seize the opportunity provided by the coronavirus pandemic to position itself as a third power in today’s multipolar world order.
