ASIA POLITICS

Why Having a Trade War With China Is Not the Best Choice for India

India made a risky response to China after the conflict on the border with China, which will make its economy more insular. 

The downturn in relationship between China and the United States suggested the possibility of a war happening. But the recent issue happening in Himalayan revealed the fact that a military conflict between China and India may happen in a bigger chance. 

Both nations are facing difficulties in making choices to avoid the happening of war. The conflict m=happened recently on border was definitively a horrible one, and the damage was severe.

It is be important for both nations to think about their long-term relationship as strategic competitors. For India, boycott Chinese goods to respond would be a wrong dealing with the rising threat from China. 

For China, the choice for them is simpler. Do they have to be aggressive to their competitors at the same time?

India has built a closer relationship with the United States in recent years. But Modi doesn’t support all opinions held by the United States. Actually, after another conflict on border in 2017, Modi met Xi Jinping in the following in China for rapprochement. During that meeting, earlier round of tensions was solved. 

But this time, the conflict may not be able to be solved in that way. 

Former senior Indian security officer mentioned that India’s policy towards China needs to change. 

This left India with limited options. Generally, India has a weaker military power. Its army is not efficient and underequipped. In addition, with the economic recession brought by COVID-19 pandemic, India’s economy is not likely to be strong in recent years, 

Modi’s decision will become complicated since the anti-Chinese movement in India. In recent months, India is likely to join the list of countries that have severely negative view towards China.

Modi should notice the anger among the public and its potential impact on unwise military response. Given China’s superior military power and the specialty of conflict terrain, mostly military options are not feasible for India.

Under the situation that boost economy is more urgent, Modi needs to choose a response that won’t hurt India’s long-term interest. 

At the same time, a ‘BoycottChina” social media campaign was boosting in India. Protesters are destroying products made in China, which revealed India’s unbalanced trade relationship with China. 

Given the big trade deficit, India is likely to join the United States and European Union in reducing FDI from China. India is also considering banning HUAWEI. 

Some of India’s potential decisions may be wise, which can inspire local firms to make their own electronics and other products. The internet will also be more secure without equipment coming from China.

But there is a problem that those decisions come with a cost. At the time when India’s economy is already struggling, India’s market is attractive to Chinese companies and investors. But the attractiveness can be ruined if the restriction is posted. 

In addition, those measurements are not likely to stop China from further action. But there is a worse risk. This trade war may encourage India to continue on its economic self-reliance road. 

Modi had almost failed to transform India into a manufacturing powerhouse. But Modi had a number of resistances doing his work.

India will need to be in this dilemma until they figure out ways to stop the economic recession. This means that India needs to build strong economic ties with other countries if they want to end their current economic relation with China.

China’s aggressive military behavior may ultimately push India into a position that changing its economic direction inwardly. China will be beneficial for this in the long term. 

For Modi, what he needed to realize is that the plan to hurt China economically will hurt themselves also. 

This article was summarized from an article written by James Crabtree published in Foreign Policy.

Link to the original article: https://foreignpolicy.com/2020/06/29/trade-war-china-bad-idea-india-border-skirmish-boycott/

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