Indo-China: Churning in the belly of the dragon

The internal ideational flux in China impels it to behave like an independent superpower. India needs to discover what it wants in a changing international environment
Zorawar Daulet Singh Delhi 

When former Chinese president Hu Jintao visited India in November 2006, he pronounced that China would not seek “selfish gains” in South Asia and called for an “early settlement of the boundary issue”. Subsequent Chinese words and deeds gave little credence to a shift in Chinese policy. China’s posture on the border seemed to harden with ill-timed rhetoric by high officials. Regionally, with an open-ended Western military presence in South Asia, Beijing seemed content with playing second fiddle to
regional geopolitics.

By December 2010, when China’s former premier, Wen Jiabao, arrived in Delhi, the focus had shifted to geoeconomics. The trade imbalance had become palpably distorted in China’s favour and India Inc. seemed to have emerged as the swing factor in India’s China policy. India’s core geopolitical concerns seemed to have been swept aside. China’s unfriendly position on Kashmir, where its rhetoric challenged India’s sovereignty even on territory east of the Line of Control, coincided with Jiabao’s visit. Overall,
China seemed uninterested in serious geopolitical engagement on areas of regional discord.

Chinese Premier Li Keqiang’s May 2013 visit suggests China is pursuing a renewed approach of engagement. Retracing China’s internal political dynamic might help in understanding the evolution of Beijing’s perceptions and worldview.

China’s internal re-orientation

Despite adaptation, ideology remains an integral element of China’s political structure. The essence of Chinese domestic contestations is about interpreting and adapting the Marxist template as both a legitimator and a guide for China’s one-party state.

By recasting Marxist ideology and Mao Zedong thought in 1982 but not completely repudiating it, Deng Xiaoping paved the way for a permanent structural feature of China’s political system that still prevails. The core ideological contest is between reformers and leftists who compete over the evolution and interpretation of the post-Maoist system that Deng adapted after 1978.

The reformers prefer an open-ended transition from socialism by liberalizing the political economy that is expanding the non-state sector and decentralizing power toward the provinces, but are unable to articulate a political or institutional template for a post-Communist Party China. The leftists also accept Deng’s re-interpretation of the Maoist system as “socialism with Chinese characteristics”, which enables China to leverage the world capitalist system and the market for economic growth. However, according to the leftists, in this socialist-modernization process, the red line of one-party state rule must not be diluted. This also implies clear differences between the reformers and the leftists in evolution of China’s political economy.

For leftists, non-state sectors and multi-ownership systems can co-exist in the political economy but must remain subordinated to the dominant state sector. Reformers are either agnostic or receptive to new class formations that emerge outside the state sector because of privatization and deep involvement with the international political economy. Leftists, in contrast, remain committed to ideologically preserving China’s ‘socialist’ identity and counteracting the effects of parallel class structures with epistemic and capital linkages to the West.

Since the Deng era of economic openness, the factional balance has favoured the reformers. After Tiananmen in June 1989, the exuberance of the liberal reformers confronted an ideological backlash and Deng  was compelled to accommodate the leftists who were aghast at the prospect of a Soviet-style implosion. Deng accommodated these voices and shaped a new consensus where Communist Party dominance would be unquestioned to enable a single-minded pursuit of economic growth. Deng’s last and decisive political act was his famous 1992 southern tour to the coastal provinces to jump-start the reform process and take the initiative away from the resurgent leftists.

The post-1992 line was that China’s greater danger came from the leftists who should not be allowed to derail the managed liberalization of China’s economy. Both ideological factions disavowed political reform but, on political economy matters the reformers under the Jiang Zemin-Zhu Rongji leadership played a significant role in expanding the non-state sector through privatization of state assets, and, promotion of foreign-invested enterprises in coastal China. The social composition of the Party was also altered as private entrepreneurs entered the organization. This balance more or less lasted until the Hu Jintao-Wen Jiabao tandem assumed power in 2002, and after 2004, the official discourse began to highlight rising inequalities between coastal and inner China and social unrest, and the imperative for balanced development. The reformers remained ascendant but were tempered by the leftist discourse over rising social inequalities. Externally, China’s integration into the global economy proceeded rapidly, and Western, Japanese, South Korean and Taiwanese MNCs enjoyed an unprecedented profit boom through their China operations.

This story is from the print issue of Hardnews: DECEMBER 2013