Taking the cue from the G-20 summit in Hangzhou, China is advocating greater participation of the Global South and the emerging countries in the world economy, including closer ties between Beijing and New Delhi.
At a major brainstorming exercise marshaled by the Communist Party of China (CPC)—China’s most influential core—several speakers recognised that western economies were avoiding structural reforms, which were necessary to revive an anemic global economy. The two-day exercise included invitees from major national and international think-tanks, as well as political parties across a wide cross-section of the globe.
Two separate sessions focused on Africa, and countries along the Mekong River, signaling China’s intent to include the Global South in its blueprint to lift the global economy.
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Many participants proposed a pervasive economic engagement between China and India, to help bring about a global turnaround. “If you look at the economic perspective, China and India are complementary to each other. There is immense scope to enhance cooperation,” observed Lin Yifu, former Vice President of the World Bank.
Amar Bhattacharya, a senior fellow with the Brookings Institution also concurred. He told The Hindu , that once the no-go areas were clarified, there was immense scope for scaling up the India-China economic partnership. “Please do not forget the big picture that by 2050 they (China) will be the first and we (India) will be second largest economies of the world, with very complementary type of demographic and supply chain structures.”
But Dr. Bhattacharya stresse that India should insist on a long-haul relationship with China, focused on joint ventures, allowing India’s “smart engineers” to absorb advanced technology. “The biggest thing India can learn from China is in the arena of infrastructure. They (the Chinese) are a powerhouse of infrastructure.”
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He added that construction and high speed railway should become flagships for tie-ups in the infra sector. “There are two countries to learn from in the construction industry—Turkey and China. South Korea has already moved to a higher league,” he observed.
The U.S. based academic highlighted that collaboration in high speed railways was promising at it would not be hampered by the availability of land—a chronic problem confronting foreign investors, seeking avenues in India’s manufacturing sector.
Dr. Bhattacharya stressed that India should build solid economic foundations with China that reinforced strong mutual interest. “That would also help us manage our differences. Pakistan as a factor in Sino-Indian ties would gradually recede to the background”.
Gopal Krishna Agarwal, a BJP national executive member, praised the integrated supply chain that China had established, based on seamless connectivity. “China has integrated its highways railways, metros and airways. The resulting fast supply chain is China’s strength from which we can learn,” he observed.
Aware of the headwinds, Mr. Lin was bearish about a quick revival of major western economies, citing their fear of structural reforms. “I am more on the pessimistic side. It is very hard for the major economies to carry out the necessary structural reforms because it means short-term constrictions, slowdown in the economy and increase in unemployment,” said the former multilateral banker.
Other participants, including Liu Yunshan, a member of powerful Politburo of CPC Standing Committee, diagnosed that geo-political and related factors were also dragging down the global economy. He cited the “refugee crisis, climate change and terrorism,” as some of the factors undermining growth.
Consequently, the Chongqing conclave called for re-defining the rules of economic governance, which should equally focus on non-economic factors hampering revival. “Usually, when we say global governance, we refer to global economic governance, which is also the focus of this dialogue. I believe, however, effective global governance can’t be founded on economics alone,” observed Song Tao, head of the International Department of the CPC. He added that the international system must now aim at “comprehensive governance” that focused on “cooperative and sustainable security,” that would yield lasting political stability.
Participants also implicitly rejected inclusion of ideologically driven agendas such as democracy and human rights, as part of the new governance rule book. Mr. Song underscored that global economic governance can prosper only when participating countries are allowed to “follow their own paths,” and actively pursue their political choices.