A Chinese scholar says that the ‘debt trap’ narrative is a part of India’s information war against China.
In order to assert the US’ role in providing both security and public goods in the Indo-Pacific region, the US launched Indo-Pacific Economic Framework (IPEF), a new trade deal in Tokyo on 23 May 2022 with 12 Indo-Pacific nations, namely Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam. President Biden was joined by the Japanese Prime Minister Kishida Fumio and the Indian Prime Minister Narendra Modi in-person, while other countries joined by video call. The region representing 60% of the world’s population and 40% of global GDP is considered as a fulcrum of future geopolitics and geo-economics. Though not many details of the framework have been revealed, however, a White House Statement issued on 23 May has listed four pillars as connected, resilient, clean and fair economy, largely on the lines of what President Biden had stated during the 16th East Asia Summit, last year. The launch could be considered a response to the China-led Regional Comprehensive Economic Partnership (RCEP) and possibly a replacement to the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).
Obviously, the elephant in the room is a resurgent and assertive China that has trounced the US as a major trade partner of most of the countries in the region since 2013. With enhanced defence capabilities and technological advancement, China has announced the arrival of a new hegemon in Asia that is not shy of challenging US hegemony in the region and beyond. The launch of the IPEF in Tokyo, a day before the scheduled summit of the Quad nations, has invited the wrath of China’s diplomatic establishment as well as its strategic community, for China believes that the security and economic alliances the US are building in the region are aimed at diminishing China’s influence in the region.
China’s State Councillor and Foreign Minister Wang Yi, in a press briefing with the Pakistani Foreign Minister, Bilawal Bhutto stated on 22 May that the “US ‘Indo-Pacific Strategy’ is doomed to fail”. According to Wang, the so-called “strategy” not only wants to erase (抹去) the name of “Asia-Pacific” and the effective regional cooperation structure (有效的区域合作架构) in the region, but also the peaceful development and momentum (平发展成果和势头) created by the joint efforts of countries in the region for decades. He further said that the “Indo-Pacific Strategy” concocted (炮制出来的) by the US under the banner of “freedom and openness” is to gang up and create small circles (拉帮结伙搞 ‘小圈子’) to encircle/contain China (围堵中国) and desiring the Asia-Pacific countries to be the “pawns” (马前卒) of US hegemony. Wang concluded by saying that the so-called “Indo-Pacific strategy” is essentially a strategy for creating divisions (制造分裂), confrontation (煽动对抗), and destroying peace (破坏和平). He accused the US of creating economic decoupling, technological blockade, supply chain disruption, and geopolitical confrontation. Wang Wenbin, spokesperson of the Ministry of Foreign Affairs, resonated Wang Yi’s remarks in a press briefing on 25 May and added that the “framework” is an attempt to establish the US-led trade rules, restructure the industrial supply chain system, and “decouple” regional countries from the Chinese economy. China Daily, the official English daily, pronounced the IPEF as a “cynical manipulative tool”, which it said was “more political than economic, more unilateral than multilateral, and more exclusive than inclusive”.
The response of the academic and strategic community is no different from the official criticism. Liu Zongyi of the Center for China and South Asia Studies at the Shanghai Institutes for International Studies, argues that the main reason for the IPEF is that the “Indo-Pacific” strategy falls short of a strong economic pillar. Since the US remains out of the CPTPP headed by Japan, and the Regional Comprehensive Economic Partnership (RCEP) led by China aimed at building “a truly open, inclusive, equitable and high-quality Trans-Pacific Free Trade Area”, the US has come out with its own trade deal, or has “set up a separate kitchen” (另起炉灶) if we use Wang Yi’s analogy. Striking a similar tone with Wang Yi, Liu says that the United States not only does not want to provide Asian countries with more market access, but it also wants to undermine Asia’s booming economic integration process. Liu argues that although the world has witnessed the emergence of three economic pillars—China, the US and Germany-France—however the Asian economic plate is centred around China, which is relatively more “Asian” and less “Pacific”, therefore, the US is apprehensive of being “pushed out” (“排挤”) of Asia. Liu posits that as China makes rapid progress in technological innovation, and creates an industrial and supply chain that is independent of the US, the US is wanting to re-establish its core position in the global supply chains, and to turn other countries in the Asia-Pacific region into its “economic colonies” (经济殖民地). According to him, there are not many countries in the region willing to board the US train, except for the “second-class citizens” ( 二等公民) in the international system and global industrial chain ruled by the United States such as Japan, South Korea, Singapore, Australia, New Zealand and some other countries.
Zhao Minghao, a researcher at the Institute of International Studies at Fudan University, opines that the IPEF is essentially a tool to compete with China. He sees two “inherent deficiencies” in the framework. One, the US will not open its market to other member states; and two, the IPEF has been advanced through executive orders signed by the Biden administration, without congressional approval. In case there is a change of government, the framework faces the risk of getting derailed, as was witnessed in the case of the TPP. Whether the IPEF will have any impact on China-ASEAN partnership, Zhao believes, it will not have much impact, as China is the largest trade partner of the ASEAN, with a trade volume of US$878.2 billion in the year 2021, registering a year-on-year increase of 28.1%. Xu Liping, a researcher at the Institute of Asia-Pacific and Global Strategy of the Chinese Academy of Social Sciences, echoes Liu’s viewpoint that the containment of China is likely to backfire in the end. However, he cautions that China cannot take the IPEF lightly, for the very motive remains to “establish a key supply chain system independent of China”; especially the one centred on semiconductors, will create more “strangleholds” (卡脖子) for China.
As regards India, Liu in another article entitled “India smells another ‘godsent opportunity’ (天赐良机) to contain China” argues that India’s participation in the IPEF is to counter the Belt and Road Initiative of China. He posits that the “debt trap” narrative is a part of India’s information war (信息战) against China. India hopes that Asia’s industrial and supply chains are relocated to India, thereby enabling it to replace China’s position in the global supply chains. Nevertheless, he maintains that India’s entry in the IPEF at its present stage of economic development will effectively delay the shaping of the IPEF. There are others like Hu Wenli of the China Youth Daily, who believe that India is not willing to blatantly provoke confrontation in the “Indo-Pacific region”, and there is also a question mark about how much actual benefits the IPEF can bring to India.
B.R. Deepak is Professor, Center of Chinese and Southeast Asian Studies, Jawaharlal Nehru University, New Delhi.