What could arguably be the most 'consequential' visit of the Prime Minister is now over. That adjective, once used to describe India -US relations, could ironically now apply to the Beijing visit, given the tantrums being seen almost daily from the White House. The maligning and insults by White House officials have added flavour to what should have otherwise have been an almost ignored event. The Shanghai Cooperation Organization (SCO) has never come up with anything exciting, but now it seems the grouping is going places, with its largest ever meeting. India's presence added the necessary spice, especially since Delhi chose very deliberately to go to Japan first. That's signalling of a sort not seen in decades.
Japanese Fine Dining
The visit to Japan prior to going to China - for what was, after all, a multilateral meeting and not a bilateral one - is of note. It was, in some measure, a taste of what Beijing has often done in clubbing India and Pakistan together in visits. There was an additional twist. This time, Beijing was holding a grand parade to mark its win against Japan during the World War. That the Prime Minister did not attend that with other guests is one thing. What would have riled the Chinese even more was the unmitigated success of his Japan visit in terms of optics, warmth and the written word. With more than 70 dialogue mechanisms and groups, ties are already at a high level, but the Joint Statement has two interesting aspects. One is the commitment to facilitate more than 5 lakh people exchanges to foster talent mobility. As the US threatens India on the H-1B visa, that's a huge thumbs up.
The second is even more interesting: the Agreement on Security Cooperation, which highlights a surprisingly large range of increased military activities, including exercises, energising logistics cooperation, research and development, interaction among special forces, supply of defence equipment, an annual NSA-to-NSA (National Security Advisor) dialogue, all of which is intended to deliver, among other things, a 'coercion-free Indo-Pacific' and common security interests. That's the basketful of goodies with which the Prime Minister arrived in Beijing.
The Xi Hiccups
Modi's meeting with Xi was watched closely across the world; it showed a certain affability, with both declaring themselves as "development partners and not rivals". The usual Chinese statement, that the border issue should not define the overall China-India relationship, was met with India's equally predictable reiteration of 'border first'. After all, Xi's analogy of a "dancing of the dragon and the elephant" is hardly possible, when one partner is looking over their shoulder for yet another salami-slicing of territory.
Again, while Beijing spoke of a 'multipolar world', India shot back with an 'multipolar Asia'. The statement basically took forward the agreement already reached when foreign minister Wang Yi visited India, which dealt with direct air flights, and opening of trade routes. But what was notable was India's careful language, that (improving) "relations should not be seen through a third country lens". In other words, no ganging up on the United States or anybody else. That left the field open for improving ties with Washington at a much, much later date. But no one is giving up on that yet.
Meanwhile, the presence of officials of the National Development and Reform Commission (NDRC) at the table may indicate some movement in rectifying the $99 billion trade deficit. This organisation has been managing the response to US tariffs and economic policy, including with countries like Kazakhstan, which has also been hit hard by tariffs. Trade is a major area that Beijing needs to relent on, for its own benefit. This is especially so since Beijing hasn't yet agreed to even the sharing of data on rivers, restricting it to only emergency sharing on humanitarian grounds. Beijing might shake hands and exude bonhomie, but if it has to be seen to deliver on the SCO's pleasantries, opening up on trade is the way to go, especially since India has already indicated that it is likely to lift curbs on Chinese Foreign Direct Investment.
The Russian Photo-ops
Then there was the camaraderie with Russian President Vladimir Putin so apparent in photo-ops, and the read-out of the meeting from the Kremlin. That meeting had a whole phalanx of ministers and a warm language of "trust-based relations for decades", and so on. The MEA's read-out was terse and emphasised the need to end the war in Ukraine. Later, however, state media seems to have thought better of it and talked of the two countries standing 'shoulder to shoulder' during difficult times.
This is undoubtedly true; the fact that Russia came to India's rescue with weaponry during the Galwan conflict is now an open secret. But it is also true that the 'cheap oil' - now even cheaper as the price of Urals crude has dipped further with a discount of around $3 a barrel - may not last long. Russia is again opening up to international buyers, and reports suggest that majors like Exxon Mobil are in talks to return to the Sakhalin oil fields. That might put an end to the huge refinery boom for India. True, Russia has offered to produce the S-500 in India for export, as well as the fifth generation Su-57, which is a major opportunity. But both deals are designed to evade sanctions. That might not be possible for India anymore, even though the BrahMos has become part of urban legend after 'Operation Sindoor'.
The forthcoming Putin visit requires strong deliverables, and Delhi will have to make those decisions or risk losing a valuable friend. India needs to export more to Russia to make up for the troubling deficit of $58 billion - mostly offset by a $12 billion-plus savings in fuel prices - but it still needs addressing. That requires Russia to import pharma, machinery and equipment from India rather than China. That, in turn, requires Indian industry to beef up its capabilities. India Inc spends less than 0.66% of GDP on research and development. China invests 8.7%. That's why one is competitive and the other merely profits.
Back To America
Which brings the whole saga back to the United States, with which trade has grown steadily to power the India growth story. That is now in danger, not just in terms of trade but also in terms of how Indians are viewed in the US, and whether an influential diaspora can hold its own. Matters are in flux indeed, but what is clear is that this is not an either-or situation. It may be tricky for India to throw in its lot with a grouping like the SCO, despite its grand proposals, with some 26 documents including the Tianjin declaration. The grouping's only commonality is that they are all connected to China through the Belt and Road Initiative (BRI) - a China that has failed to provide the grouping with the leadership and finances required to power up each struggling economy in a kind of Marshall Plan post the World War that once benefited Europe and made US a world power. Instead, China is leeching away at whatever resources each of them.
At Tianjin, what was evident with India was an ambidextrous policy of engaging with friend and foe alike, using the one to balance out the other. That's all very well. But in the final analysis, this is not just about timely visits and elaborate joint statements. This is about trade and business. Time for India Inc to realise that innovation is key to keeping our heads up, not putting together knocked down kits and selling them forward. To power up foreign policy, India needs to get its industry going. At a time when one can expect frequent threats of sanctions, that's what will keep our heads above water and keep foreign investors interested.
Disclaimer: These are the personal opinions of the author
