China Seeks Indian and Russian Backing for ‘New’ Trading System

Modi expected to join Xi and Putin at SCO summit to express support for the initiative

Let’s see if something tangible comes out of this

China hopes to win Indian and Russian support in establishing a “new type” of “rules-based” and “multilateral” trade initiative.

Multiple Indian media reports suggest the country’s recently re-elected Prime Minister Narendra Modi will join forces with Chinese President Xi Jinping and Russian leader Vladimir Putin on the sidelines of the Shanghai Cooperation Organisation (SCO) summit in Kyrgyzstan this week to express their concerns about US President Donald Trump’s protectionist approach.

The summit comes ahead of an expected meeting between Xi and Trump at the G20 summit in Japan, where they are expected to hold talks aimed at resolving their trade dispute.

However, the confrontation between the United States and China has expanded into a number of other areas, such as technology and geopolitics.

Trump has threatened to impose further trade tariffs if Xi refuses to meet him in Osaka and the US president has asked its allies to help contain China.

In response, China has also been seeking support from other countries – including Russia, which Xi visited last week to affirm his closeness to Putin, whom he described as his “best friend”.

India is one of the many countries that has expressed concern about the impact of the White House’s protectionist policies, leading to the expectation that it will use the Shanghai Cooperation Organisation platform to express its stance.

The Beijing-led organisation, known as the “alliance of the East”, is intended to provide an alternative platform for political, economic and security cooperation to those led by the US or other Western nations, and India became a member two years ago.

“The SCO summit will be an opportunity for China to solidify ties with [New Delhi] and a new proposal for a multilateral trading system could be a way to strengthen relations with India, which is also targeted by Trump’s trade policies,” Zhang Baohui, director of the Centre for Asian Pacific Studies at Lingnan University in Hong Kong, said.

“Due to the trade war with the US and the broadening strategic rivalry between them, China would like to improve relations with other countries, including both Russia and India.”

Rajeev Ranjan Chaturvedy, a visiting fellow at the S. Rajaratnam School of International Studies at Nanyang Technological University in Singapore, said India’s concerns about Trump’s protectionist policies “are related to problems encountered by its IT services [sector], the imposition of tariffs on steel and aluminium, agriculture products and intellectual property rights”.

“Trump’s recent move in withdrawing the Generalised System of Preferences (GSP) trade status given to India three decades ago is an immediate concern for India,” Chaturvedy said.

“India would like to get trade in services, [the] knowledge economy and greater market access included as part of such agreements.

“Technology transfer, data localisation are some other important areas where India needs to protect its interests.”

Other analysts noted that India’s main goal was to maintain a balance – both economic and strategic.

Sampa Kundu, an assistant professor at Symbiosis School of International Studies in India, said that despite the differences between the two countries, “both China and India understand the importance of each other, both at the regional level and at the international level … Both are significant stakeholders in Asian politics, as well as in global geopolitical affairs.”

“The upcoming SCO summit may play an important role in strengthening India’s relations with the regional and global powers,” Kundu added, but said it was likely that the country would continue to support the US policy of containing China as part of its free and open Indo-Pacific strategy.

It is also unclear how practical it would be to replace the current US-led trade system with the new platform to be announced at the summit.

“Neither Russia nor India are significant trading powers in the global economic system,” Zhang said.

“Many [economically advanced] countries, major European economies and Japan, have voiced their concerns about the Trump administration’s unilateral approach too, but they want to shore up the WTO multilateral system, not start something totally new.”

Source: South China Morning Post

Subscribe
Notify of
guest
3 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments

Godfree Roberts
Godfree Roberts
11 months ago

How practical would it be to replace the current US-led trade system?

The BRI, with 130 member countries, is doing a fine job of it, growing at 17% annually since its founding.

Last year, Xi signed another one-hundred billion dollar trade and economic agreement with the Eastern Europe Economic Union, EEEU–Belarus, Kazakhstan, Russia, Armenia and Kyrgyzstan. Russia has begun work on the Western end of a high speed rail line designed to run from Moscow to Beijing and, in 2019, added a new dimension: the Polar Sea Route, ‘connecting northeastern, eastern and southeastern Asia with Europe.’ Russia’s President Putin proposes to create a single, integrated market from the Pacific to the Atlantic with the EEEU, the BRI, the SCO and ASEAN (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam).

Then there’s the massive Regional Comprehensive Economic Partnership, RCEP, a free trade agreement between ASEAN and Australia, China, India, Japan, South Korea and New Zealand: 3.4 billion people with a total GDP of fifty trillion dollars, forty percent of world GDP. The RCEP is the world’s largest economic bloc, covering nearly half of the global economy and accounting firm PwC estimates its GDP will reach $250 trillion, half of global GDP, in 2050 and increase global real incomes by $286 billion per year. By 2045 the entire Eurasian continent will be bound by treaties, roads, railways, ports, fiberoptic cables, electrical grids and pipelines: a new world order under China’s humane authority.

To knit these alliances more permanently, in 2016 Beijing launched the Global Electric Interconnect, GEIDCO, a grid of ultra-high voltages lines transmitting clean energy around the globe continually, with the sun. By 2019 GEIDCO had seven regional offices, forty global offices, six-hundred regional and national members and invested $1.6 trillion invested in eighty generation and transmission projects across Latin America, Africa, Europe and North America.

ALTERNATE HISTORY
ALTERNATE HISTORY
11 months ago

Great information, Godfree. Many thanks.

Godfree Roberts
Godfree Roberts
11 months ago

Berry welcome. I started accumulating stuff like that in earnest ten years ago and began turning it into a book in 2016. I hope to send the ms. off to publishers next week.

My hope is that, between now and publication time, some event occurs to make Westerners curious about what China is really up to.

Anti-Empire