XiNomics and Tame Wolf Diplomacy

Binit Patnaik*

Chinese diplomacy, which is no more seen as diplomacy, has multiple interesting insights into the otherwise opaque country, for both the domestic audience and international watchers. The cartographic aggression shown by President Xi is one of the latest stunts from the same script.

Xi's conspicuous absence from global multilateral events, most recent being the Bharat-hosted G20, makes one wonder if Xi's internal problems are driving him too insecure to leave the country or is he 'rethinking' about the West-led international groupings. Either of them will have negative consequences, with the Chinese being portrayed as a spoiler. As they say in diplomatic circles, either one can be on the table or on the menu. In other words, Xi’s absence can be seen as a catastrophic move for China’s global leadership aspirations.

According to the International Monetary Fund (IMF) data, China tops the chart in terms of the size of the economy in terms of Purchasing Power Parity (PPP). However, ground reality presents a contrasting picture of the same. Things are not as rosy if one looks at the bulging debt to GDP ratio of China, which now exceeds 300%. Youth unemployment rate exceeds 20%.

In the beginning of his tenure, Xi bet big on infrastructure. China's real estate sector forms about 30% of its total GDP, as against 17% in the US, 11% in Japan and so on. Domestically, the dragon state saw a boom in the development of cities and skyscrapers for people to dwell in.

Life certainly played a cruel joke on Xi when Covid happened. People ditched them apartments and the cities soon wore the look of ghost towns. The large real estate companies filed for bankruptcy, which had a multiplier effect on other sectors too. A botched up Covid management strategy worsened things for the people. One cannot stop themselves from asking if this is turning out to be a perfect recipe for Tianamen 2.0.

As of today, the Chinese economy has contracted for the fifth consecutive month. Thanks to Xi's insecurity with the private sector, there is little hope that the economy would bounce back anytime sooner.

At this juncture, time is ripe for Xi to play the 'nationalism' card. He not only needed to strengthen his strongman image but also deflect the attention of the domestic audience from their hardships.

Making absurd territorial claims and drawing imaginary lines reflects of a childish demeanour from a mature civilizational state. The Chinese have done it since the 1950s, starting from Zhao Enlai. When asked, they have continued to downplay it as an annual exercise. However, dismissing it as a mere hogwash won't do justice to such moves. It is worth noting here that China has had territorial disputes with more number of nations than it shares its borders with. It reflects of a bigger and deeper game plan.

An over-activated Line of Actual Control (LAC) has forced New Delhi to revisit its relationship with Beijing. Also, Bharat has now hardened its stance from previously demanding for status quo ante April 2020 to now stressing on resolving of all the border disputes for a normalized relationship after multiple rounds of armed forces talks.

Normalization is the plausible way forward for the two big nuclear powers. How long is it going to take depends on the aggressor, which in this case clearly is China. As a matter of fact, the next 12 to 24 months are going to be the most decisive for Beijing-New Delhi relationship for years ahead.

The recent BRICS summit saw Bharat snubbing the Chinese for a bilateral on the sidelines. This is also part of his reasoning for being absent from multilateral meetings that take away the spotlight away from him. He occasionally forays into groupings where there is minimalistic western presence and influence. The most recent being the Shanghai Cooperation Organization (SCO) meeting in New Delhi.

In the face of heightened tensions with several of his counterparts, Mr. Xi by no means would have received a warm welcome by world leaders at this year’s G20.

(*Mr. Binit Patnaik is a freelance writer dealing with Indian political system and International Affairs)