China's Indian charm offensive GOOD NEWS FOR ASEAN
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China's improving relationship with India is good news for Asean and Thailand. Last month Indian Prime Minister Narendra Modi paid his first official visit to China, where the warmth of his reception by Chinese President Xi Jinping caught many by surprise
Xi took Modi to his hometown Xian, which in its earlier incarnation as Changan was the starting point for the ancient trading route, the Silk Road. It was a fitting location for this meeting of the two Asian superpower, given China’s modern and ambitious “One Belt, One Road” initiative for expanding its markets.
Modi’s priority was to attract more Chinese investment in India’s infrastructure and manufacturing and redress the commercial imbalance between the two countries – India’s trade deficit with China runs a massive US$40 billion (Bt1.35 trillion).
After meeting Xi, Modi also spent time in Shanghai networking with some of China’s top business leaders and attending the India-China Business Forum, at which agreements worth $22 billion were signed.
Observers saw Xi’s hospitality as a response to Modi’s courting of other countries in his diplomatic drive to contain China’s growing influence in Asia, by strengthening India’s relationships with Japan, Sri Lanka and the US, for example, and even reaching out to old foe Pakistan, a strong Chinese ally for many years.
While there has been tension between the two over disputed borders, agreement was reached last month to exchange annual visits between their militaries, expand dialogue between border commanders and avail of a military hotline to defuse flare-ups.
One of the most tangible signs of the deepening relationship is India’s decision to take a reported 8.4-per-cent stake in the Chinese-led Asian Infrastructure Investment Bank versus Thailand’s 1.4 per cent.
That followed the appointment of an Indian banker as the first head of the Shanghai-based New Development Bank, which is co-funded by Brazil, Russia, India, China and South Africa.
With Southeast Asia and Thailand sitting right between the two giants, it’s reassuring that they’re getting along much better. Both are important trading and diplomatic partners although China looms larger. Thailand’s trade with China last year reached $63 billion, while trade with India was worth $9 billion.
Just before he left China, Modi used his Weibo account to express hope that both sides would work hard to further develop their relationship in the years ahead.
Thailand and its Asean neighbours can take a lot of solace from that.
