From China with love

Pic courtesy pmindia.gov.in

Raju Korti
If there is one thing that you got to give it to the ruthlessly pushy Chinese, it is their clear perceptions in not mixing bilateral trade with security issues. So even as Prime Minister Narendra Modi carries forward his investment caravan by hosting the incumbent President Xi Jinping with Khaman Dhokla and Won Ton soup for the starters, there is a reasonable sense of optimism that the country's creaking infrastructure will get a much needed boost from this new-found engagement.
Naysayers will, of course, be quick to harp on China's past record in treachery as also its meager investments post-2000 but much water has flown under the bridge since the visits of President Jiang Zemin and President Hu Jintao where diplomacy had taken precedence over bilateral trade. One should not be surprised if Jinping has come with a baggage that aims at arresting the growing trade deficit against India. Modi actually deserves a pat for making it implicitly clear to Beijing that the only mutually beneficial option was trade investment rather than tariff concessions. While investment per se may not be a conduit for bringing down the trade deficit, it could help the country's manufacturing sector through imports from China.
I have few doubts that given his astute Gujarati business mind it is not beyond Modi's ken to put investment from Japan and China on a fast track mechanism while subtly impressing upon the Chinese leader the Gandhian ethos that flows off the tranquil Sabarmati.
To me, Modi's three summits with three of the world's most powerful leaders in Tokyo, New Delhi and Washington will provide some impetus to the dormant diplomacy in the Manmohan Singh's decade. Obviously, Modi is nursing a two-pronged approach. One, shoring up the economy to achieve an annual growth rate of 8% and two -- and also the more obvious -- that will see him firmly in the saddle. The investments from China, United States, Japan, Germany will be a concrete step in that direction but one needs to look beyond the apparent to realize that Modi's meetings with Xi and Barrack Obama within a fortnight's span have been smartly timed. If the feelers from Beijing are to be interpreted correctly, China is not investing in just India but also in the new Prime Minister by confabulating with him in the land of his roots.
Although both the countries have done well to keep contentious issues relating to the border and Tibet by the wayside, Modi will have some political balancing to do and his handling of the Xi and Obama visits are certain to come in for close scrutiny and comparison. Dealing with the Americans, I suspect, won't be as easier given the hiccups that accrue between the two countries besides Modi's battered ego in the wake of denial of a visa. Modi isn't a person who is likely to forget that kind of slight. But then it will also be a chastening experience of sorts for the American President to entertain a no-visa politician to a dinner-table-Prime Minister. Speaks volumes about what massive public mandate can do to the relationship between two countries. From all available indications, the past seems to have been buried and Modi might pass the US test with Washington acknowledging his innocence in the 2002 riots although there remains a sizeable number of critics who are not prepared to give him a clean chit.
Reports emanating from the American capital suggest that the Obama administration is all geared up to welcome Modi since the argument now is the denial of visa was more of an ethical issue than a political one. The winds have blown favorably with the Japanese and the Chinese. Xi, who also happens to be the General Secretary of the powerful Communist Party, is being accompanied by over 40 media persons. It is but some indication of the significance the Chinese attach to this visit when you take into account the state-controlled Media there.
There are friction points as well. Business back home is not going to take in kindly if the Prime Minister opens umbrella industries like retail and banking. That could open a Pandora's box that might injure some of the economic advantage that he seeks to garner. As for Amdavadis, they would not mind a few traffic restrictions as long as the China Development Bank offers loans at lower rates.
A point in passing. The business sense that I am trying to put forth over here is patently Gujarati. Modi happens to be incidental to that cause.