Friday, November 7, 2008



China is an island. We do not mean it is surrounded by water; we mean China is surrounded by territory that is difficult to traverse. Therefore, China is hard to invade; given its size and population, it is even harder to occupy. This also makes it hard for the Chinese to invade others; not utterly impossible, but quite difficult. Containing a fifth of the world’s population, China can wall itself off from the world, as it did prior to the United Kingdom’s forced entry in the 19th century and under Mao Zedong. All of this means China is a great power, but one that has to behave very differently than other great powers.

Analyzing Chinese Geography

Let’s begin simply by analyzing Chinese geography, looking at two maps. The first represents the physical geography of China.

The second shows the population density not only of China, but also of the surrounding countries.
China’s geography is roughly divided into two parts: a mountainous, arid western part and a coastal plain that becomes hilly at its westward end. The overwhelming majority of China’s population is concentrated in that coastal plain. The majority of China’s territory — the area west of this coastal plain — is lightly inhabited, however. This eastern region is the Chinese heartland that must be defended at all cost.

China as island is surrounded by impassable barriers — barriers that are difficult to pass or areas that essentially are wastelands with minimal population. To the east is the Pacific Ocean. To the north and northwest are the Siberian and Mongolian regions, sparsely populated and difficult to move through. To the south, there are the hills, mountains and jungles that separate China from Southeast Asia; to visualize this terrain, just remember the incredible effort that went into building the Burma Road during World war II. To the southwest lie the Himalayas. In the northwest are Kazakhstan and the vast steppes of Central Asia. Only in the far northeast, with the Russian maritime provinces and the Yalu River separating China from Korea, are there traversable points of contacts. But the balance of military power is heavily in China’s favor at these points.

Strategically, China has two problems, both pivoting around the question of defending the coastal region. First, China must prevent attacks from the sea. This is what the Japanese did in the 1930s, first invading Manchuria in the northeast and then moving south into the heart of China. It is also what the British and other European powers did on a lesser scale in the 19th century. China’s defense against such attacks is size and population. It draws invaders in and then wears them out, with China suffering massive casualties and economic losses in the process.

The second threat to China comes from powers moving in through the underpopulated portion of the west, establishing bases and moving east, or coming out of the underpopulated regions around China and invading. This is what happened during the Mongol invasion from the northwest. But that invasion was aided by tremendous Chinese disunity, as were the European and Japanese incursions.

Beijing’s Three Imperatives

Beijing therefore has three geopolitical imperatives:

Maintain internal unity so that far powers can’t weaken the ability of the central government to defend China.

Maintain a strong coastal defense to prevent an incursion from the Pacific.

Secure China’s periphery by anchoring the country’s frontiers on impassable geographical features; in other words, hold its current borders.

In short, China’s strategy is to establish an island, defend its frontiers efficiently using its geographical isolation as a force multiplier, and, above all, maintain the power of the central government over the country, preventing regionalism and factionalism.

We see Beijing struggling to maintain control over China. Its vast security apparatus and interlocking economic system are intended to achieve that. We see Beijing building coastal defenses in the Pacific, including missiles that can reach deep into the Pacific, in the long run trying to force the U.S. Navy on the defensive. And we see Beijing working to retain control over two key regions: Xinjiang and Tibet.

Xinjiang is Muslim. This means at one point it was invaded by Islamic forces. It also means that it can be invaded and become a highway into the Chinese heartland. Defense of the Chinese heartland therefore begins in Xinjiang. So long as Xinjiang is Chinese, Beijing will enjoy a 1,500-mile, inhospitable buffer between Lanzhou — the westernmost major Chinese city and its oil center — and the border of Kazakhstan. The Chinese thus will hold Xinjiang regardless of Muslim secessionists.

The Importance of Tibet to China

Now look at Tibet on the population density and terrain maps. On the terrain map one sees the high mountain passes of the Himalayas. Running from the Hindu Kush on the border with Pakistan to the Myanmar border, small groups can traverse this terrain, but no major army is going to thrust across this border in either direction. Supplying a major force through these mountains is impossible. From a military point of view, it is a solid wall.

Note that running along the frontier directly south of this border is one of the largest population concentrations in the world. If China were to withdraw from Tibet, and there were no military hindrance to population movement, Beijing fears this population could migrate into Tibet. If there were such a migration, Tibet could turn into an extension of India and, over time, become a potential beachhead for Indian power. If that were to happen, India’s strategic frontier would directly abut Sichuan and Yunnan — the Chinese heartland.

The Chinese have a fundamental national interest in retaining Tibet, because Tibet is the Chinese anchor in the Himalayas. If that were open, or if Xinjiang became independent, the vast buffers between China and the rest of Eurasia would break down. The Chinese can’t predict the evolution of Indian, Islamic or Russian power in such a circumstance, and they certainly don’t intend to find out. They will hold both of these provinces, particularly Tibet.

The Chinese note that the Dalai Lama has been in India ever since China invaded Tibet. The Chinese regard him as an Indian puppet. They see the latest unrest in Tibet as instigated by the Indian government, which uses the Dalai Lama to try to destabilize the Chinese hold on Tibet and open the door to Indian expansion. To put it differently, their view is that the Indians could shut the Dalai Lama down if they wanted to, and that they don’t signals Indian complicity.

It should be added that the Chinese see the American hand behind this as well. Apart from public statements of support, the Americans and Indians have formed a strategic partnership since 2001. The Chinese view the United States — which is primarily focused on the Islamic world — as encouraging India and the Dalai Lama to probe the Chinese, partly to embarrass them over the Olympics and partly to increase the stress on the central government. The central government is stretched in maintaining Chinese security as the Olympics approach. The Chinese are distracted. Beijing also notes the similarities between what is happening in Tibet and the “color” revolutions the United States supported and helped stimulate in the former Soviet Union.

It is critical to understand that whatever the issues might be to the West, the Chinese see Tibet as a matter of fundamental national security, and they view pro-Tibetan agitation in the West as an attempt to strike at the heart of Chinese national security. The Chinese are therefore trapped. They are staging the Olympics in order to demonstrate Chinese cohesion and progress. But they must hold on to Tibet for national security reasons, and therefore their public relations strategy is collapsing. Neither India nor the United States is particularly upset that the Europeans are thinking about canceling attendance at various ceremonies.

A Lack of Countermoves

China has few countermoves to this pressure over Tibet. There is always talk of a Chinese invasion of Taiwan. That is not going to happen — not because China doesn’t want to, but because it does not have the naval capability of seizing control of the Taiwan Straits or seizing air superiority, certainly not if the United States doesn’t want it (and we note that the United States has two carrier battle groups in the Taiwan region at the moment). Beijing thus could bombard Taiwan, but not without enormous cost to itself and its own defensive capabilities. It does not have the capability to surge forces across the strait, much less to sustain operations there in anything short of a completely permissive threat environment. The Chinese could fire missiles at Taiwan, but that risks counterstrikes from American missiles. And, of course, Beijing could go nuclear, but that is not likely given the stakes. The most likely Chinese counter here would be trying to isolate Taiwan from shipping by firing missiles. But that again assumes the United States would not respond — something Beijing can’t count on.

While China thus lacks politico-military options to counter the Tibet pressure, it also lacks economic options. It is highly dependent for its economic well-being on exports to the United States and other countries; drawing money out of U.S. financial markets would require Beijing to put it somewhere else. If the Chinese invested in Europe, European interest rates would go down and U.S. rates would go up, and European money would pour into the United States. The long-held fear of the Chinese withdrawing their money from U.S. markets is therefore illusory: The Chinese are trapped economically. Far more than the United States, they can’t afford a confrontation.

That leaves the pressure on Tibet, and China struggling to contain it. Note that Beijing’s first imperative is to maintain China’s internal coherence. China’s great danger is always a weakening of the central government and the development of regionalism. Beijing is far from losing control, but recently we have observed a set of interesting breakdowns. The inability to control events in Tibet is one. Significant shortages of diesel fuel is a second. Shortages of rice and other grains is a third. These are small things, but they are things that should not be happening in a country as well-heeled in terms of cash as China is, and as accustomed as it is to managing security threats.

China must hold Tibet, and it will. The really interesting question is whether the stresses building up on China’s central administration are beginning to degrade its ability to control and manage events. It is easy to understand China’s obsession with Tibet. The next step is to watch China trying to pick up the pieces on a series of administrative miscues. That will give us a sense of the state of Chinese affairs.

Tuesday, November 4, 2008


This crystal gazing article is written by GORDON ORR, DIRECTOR - Shanghai office, McKinsey&Co.

How will China surprise us next? Shocks, tipping points, and revelations have become basic staples of the world’s daily news diet. But with so many eyes now on this emerging Asian giant, what happens there continues to have an exceptional ability to draw attention and to shift perceptions drastically and suddenly.

Will the surprise be planned, like the magnificent Beijing Olympics Games, whose nearly flawless execution set a counterpoint to China’s image as an economic laggard buoyed mainly by cheap labor? Will it repel, like the tainted-milk scandal? Or will it send a message, as Lenovo’s takeover of IBM’s personal-computer business did in serving notice that Chinese companies were ready to enter the global fray?

Here’s a list of some realistic possibilities for the next year. Will all of them come to pass? I doubt it. But any one of them could, and each might make us see China and its future in a new light. What do you think?

1. China announces that by 2020, half of the cars in the country will be electric. It invests tens of billions of dollars in R&D toward achieving that goal.

Such a move could make China the leader in the automotive technology of the future, with other countries struggling to keep pace. Shanghai Automotive Industry Corporation (SAIC) or newcomer BYD Auto could become the Ford Motor of the 21st century, propelled by a new technology—much as Ford capitalized on the internal-combustion engine at the start of the 20th century.

2. The Chinese government buys a 50-year lease on an entire geographic region of Mexico, enabling Chinese companies to build factories there to supply the North American market more easily.

Chinese companies would then become the undisputed leaders in outsourced production. No longer constrained by geography, they could bring their expertise in low-cost manufacturing to Mexico (or Poland or Turkey), greatly expanding their reach and overcoming obstacles—such as maintaining supply chains across the Pacific—that still hinder their growth.

3. A major office block collapses in Chaoyang, Beijing’s central business district.

Although officials would scramble to rewrite construction regulations, a disaster in the capital or another large city would change the relationship between the country’s growing middle class and the government and might threaten its ability to keep social unrest in check. True, construction standards came under fire after the May 2008 Sichuan earthquake felled many school buildings. But the reaction to that tragedy would pale beside the response to a similar one in a rich urban area with immediate media access.

4. A leading Chinese company tries to buy an iconic US technology firm (or two).

A major deal could be worth 10 or 100 times Lenovo’s $1.35 billion purchase of IBM’s PC division. If the US government blocked the sale, the acquisition’s failure could herald an era of renewed corporate nationalism in China, just as its companies were becoming more global. You could expect an aggressive increase in domestic R&D spending as the country focused on homegrown technology, as well as a chillier climate for multinationals with research operations in China.

A successful deal, by contrast, could create a truly global company, unlike anything seen before, with a multinational culture superseding any sense of national origins.

5. A restructuring of China’s telecommunications industry turns into a complete consolidation.

Regulatory failure and competitive imbalances have already reduced competition down to three major players, from four, and telecom companies are now being encouraged to share infrastructure. If stock prices continue their freefall and these imbalances remain, the inability of the second- and third-ranked players to chart a path to success could bring a full reconsolidation of the domestic industry.

6. The English Premier League football association buys its Chinese counterpart, the Chinese Super League.

What better way to signal a coming of age for China’s urban middle class? The takeover would be a major bet that this growing socioeconomic group is ready to spend heavily on sports and entertainment—a bet that could open the floodgates for investment in other consumer sectors. Wallets are already opening up: witness the Olympics and the US National Basketball Association’s exploration of franchise and stadium deals in China. Such a purchase would also show that the country is willing to bring outside expertise and professionalism into a challenged domestic industry.

7. Warming cross-strait relationships lead to a merger between the mainland’s Industrial and Commercial Bank of China and Taiwan’s Chinatrust Commercial Bank.

The reaction in Taiwan would probably be ambivalent—just another large business deal. But in China, a cross-strait merger of powerhouses like these, in banking or some other sector, would be applauded as an affirmation of its One China worldview.

Friday, October 10, 2008


The analysts from Jane’s Information Group, believe that the Chinese Communist Party can only continue to rule the country if it maintains economic growth at more than 10 per cent. It is already investing heavily in Africa for food and natural resources but this could lead to a CONFLICT WITH INDIA with the trade route that crosses the Indian Ocean.

Are we ready for this future conflict?

China, historically has been a land power, barring the dynasty of Zeng He in 15th century, when China had famed treasure fleets. Then, it was more for explorations rather than expansions or even guarding any trade lanes. As threat of invasion from north increased, China quickly abandoned its ocean going enterprises – considering them to be expensive.

However 21st century is panning out quite the opposite. China has found itself increasingly dependant on resources and markets accessible only via maritime routes. Where US and Japan are dominant naval powers, China is stepping up its naval capabilities quite dramatically. Chinese navy is seeking to project powers not only throughout East and South China seas but also to Indian Ocean basin and beyond, to West Africa and Latin America.

By 2015 China is expected to have six Jin-class submarines capable of firing the JL2 ballistic nuclear missile that could threaten both the western and eastern American seaboards acting as deterrent to any US intervention if Taiwan or other areas erupted in conflict.

China’s nuclear attack submarine force is expanding “quite considerably” with six T93 hunter killers and more than a dozen Kilo class boats.

Fast attack craft, each carrying eight anti-ship missiles, are to increase from 40 to 100 giving the navy “a considerable capability. There had been a major build up of assault ships including 30 large tank landing craft that would allow long range operations.

2009 – Chinese navy pilots will begin training for aircraft carrier operations, that are expected to become operational early next decade.



Nestled between India and China at an altitude of 14,500 feet, and 4 hours bone shaking drive from Leh, lies Pangong Lake (also known as Lukung Lake). 45 kms of this lake lies within Indian territory while the remaining 90 kms lies within China.

Things deteriorated in 1999 after China, taking advantage of the Indian Army’s buildup in Kargil, built a 5-km permanent track into Indian territory along the lake.

The Chinese have led incursions into India because they know that they can – and can get away with it. It’s as simple as that. Our politicians refuse to acknowledge even today the Chinese threat. Reminds one of the 1962 debacle when Krishna Menon ordered COFFEE PERCOLATORS to be made in ARMS FACTORY – thinking that the Chinese aggression is a myth, only to be proved wrong at a catastrophic cost to the country.

In July 2008, an Indian motorboat on regular patrolling duty along the perceived border in the lake, was surrounded by three Chinese naval crafts. Things started turning tense as the Chinese crafts approached the Indian boat (which was sufficiently armed with two machine guns and a 20 -member contingent). The situation calmed down only after the quick thinking operator swung around the larger Indian boat in circles to disperse the Chinese crafts.

The Chinese Navy operates close to 22 armed patrol boats in the lake — mostly smaller vessels seating five to seven soldiers. India, on the other hand, has two patrol boats that are operated by the Army. While these boats are bigger — carrying up to 21 soldiers — the numeric superiority that China enjoys is undeniable.

Stuck in the corridors of South Block is a proposal to ferry in an additional 10-12 boats for better patrolling of the lake.

BACK TO 1962: The Govt of India, with Krishna Menon as Defence Minister, was least interested in defence preparedness. Ordnance factories were manufacturing coffee percolators and toasters, because they had “extra spare capacity”. But as they all shouted in Parliament, “ ------every inch of our land will be defended to the last man.” With what?



The Chinese have two major claims on what India deems its own territory.

One claim, in the western sector, is on Aksai Chin in the northeastern section of Ladakh District in Jammu and Kashmir.

The other claim is in the eastern sector over a region included in the British-designated North-East Frontier Agency, the disputed part of which India renamed Arunachal Pradesh and made a state.

In the fight over these areas, the well-trained and well-armed troops of the Chinese People's Liberation Army overpowered the ill-equipped Indian troops, who had not been properly acclimatized to fighting at high altitudes.

Unable to reach political accommodation on disputed territory along the 3,225-kilometer-long Himalayan border, the Chinese attacked India on October 20, 1962. At the time, nine divisions from the eastern and western commands were deployed along the Himalayan border with China. None of these divisions was up to its full troop strength, and all were short of artillery, tanks, equipment, and even adequate articles of clothing.

In Ladakh the Chinese attacked south of the Karakoram Pass at the northwest end of the Aksai Chin Plateau and in the Pangong Lake area about 160 kilometers to the southeast. The defending Indian forces were easily ejected from their posts in the area of the Karakoram Pass and from most posts near Pangong Lake. However, they put up spirited resistance at the key posts of Daulat Beg Oldi (near the entrance to the pass) and Chushul (located immediately south of Pangong Lake and at the head of the vital supply road to Leh, a major town and location of an air force base in Ladakh). Other Chinese forces attacked near Demchok (about 160 kilometers southeast of Chusul) and rapidly overran the Demchok and the Jara La posts.

In the eastern sector, in Assam, the Chinese forces advanced easily despite Indian efforts at resistance. On the first day of the fighting, Indian forces stationed at the Tsang Le post on the northern side of the Namka Chu, the Khinzemane post, and near Dhola were overrun. On the western side of the North-East Frontier Agency, Tsang Dar fell on October 22, Bum La on October 23, and Tawang, the headquarters of the Seventh Infantry Brigade, on October 24. The Chinese made an offer to negotiate on October 24. The Indian government promptly rejected this offer.

With a lull in the fighting, the Indian military desperately sought to regroup its forces. Specifically, the army attempted to strengthen its defensive positions in the North-East Frontier Agency and Ladakh and to prepare against possible Chinese attacks through Sikkim and Bhutan. Army units were moved from Calcutta, Bihar, Nagaland, and Punjab to guard the northern frontiers of West Bengal and Assam. Three brigades were hastily positioned in the western part of the North-East Frontier Agency, and two other brigades were moved into Sikkim and near the West Bengal border with Bhutan to face the Chinese. Light Stuart tanks were drawn from the Eastern Command headquarters at Calcutta to bolster these deployments.

In the western sector, a divisional organization was established in Leh; several battalions of infantry, a battery of twenty-five-pounder guns, and two troops of AMX light tanks were airlifted into the Chushul area from Punjab. On November 4, the Indian military decided that the post at Daulat Beg Oldi was untenable, and its defenders were withdrawn over the 5,300-meter-high Sasar Brangsa Pass to a more defensible position.

The reinforcements and redeployments in Ladakh proved sufficient to defend the Chushul perimeter despite repeated Chinese attacks. However, the more remote posts at Rezang La and Gurung Hill and the four posts at Spanggur Lake area fell to the Chinese.

In the North-East Frontier Agency, the situation proved to be quite different. Indian forces counterattacked on November 13 and captured a hill northwest of the town of Walong. Concerted Chinese attacks dislodged them from this hard-won position, and the nearby garrison had to retreat down the Lohit Valley.

In another important section of the eastern sector, the Kameng Frontier Division, six Chinese brigades attacked across the Tawang Chu near Jang and advanced some sixteen kilometers to the southeast to attack Indian positions at Nurang, near Se La, on November 17. Despite the Indian attempt to regroup their forces at Se La, the Chinese continued their onslaught, wiping out virtually all Indian resistance in Kameng. By November 18, the Chinese had penetrated close to the outskirts of Tezpur, Assam, a major frontier town nearly fifty kilometers from the Assam-North-East Frontier Agency border.

The Chinese did not advance farther and on November 21 declared a unilateral cease-fire. They had accomplished all of their territorial objectives, and any attempt to press farther into the plains of Assam would have stretched their logistical capabilities and their lines of communication to a breaking point. By the time the fighting stopped, each side had lost 500 troops.

Friday, September 19, 2008


The bonhomie between China and the Bengali Marxists continue. Chinese Foreign Minister Yang Jiechi inaugurated the Chinese consulate in Kolkata on Sunday 7th September 2008. CPI(M) manages to, deliberately or not, look like the Chinese foreign policy arm in India. It is not only the NSG, but its entire likes and dislikes mirror that of the Chinese.

But does the opening of the new consulate portend growing friendliness between India and China. Far from it : NSG & CHINA – In 3 steps below.

1. High drama at NSG : India is miffed at China antagonistic role at the Nuclear Supplier’s group where China asked for Indian parity with Pakistan and requested additional resources from New Delhi which India may have considered very demeaning and akin to extracting a pound of flesh at a critical juncture.

2. When the Indian Prime Minister Manmohan Singh tried to call the Chinese President Hu Jintao, the Chinese refused to take the call of the Indian Prime Minister and continued to snub the PM until the Americans intervened.

3. All the Indians could do was sulk. In retaliation, the angry Sonia Gandhi refused to see the Chinese Foreign Minister. To intimidate China, India last week announced the resurrection of forward air-force bases in the Northeast and Northwest.

A Pakistani think tank report stated : Beijing is ready to offer Pakistan a similar Nuclear deal that India got from the US. However Indian analysts who do not understand Chinese-Pakistani relations are expecting a public signing of a Pakistani-Sino deal in the same fashion as the Indo-US deal was announced. China and Pakistan work at different levels. The major difference is the Chinese Nuclear deal does not come with any strings and is cheaper. China has already built the Chasnupp 1 and the Chasnupp 2. To avoid a lot of publicity, the last time Pakistan and China worked out a nuclear deal (Chasnupp 2) it was announced without any pomp and ceremony.

An upgrade to the Gwader-China road and rail link is expected to bring huge benefits to the FATA that has already been signed between the two countries.

India today can block Chinese ships in the Indian ocean and this may prove decisive in any conflict with the Chinese. The Chinese do not have any aircraft carriers, but they will in 5 to 10 years time. Gwadar port in Pakistan gives them a chocking point with which to strangulate India with its “bead of pearls”. India may have constructed Chabahar port in Iran, but will it be enough?

The sad truth is that India is losing influence to the Chinese amongst all its neighbours, barring Bhutan.

Pakistan is long gone to the Chinese.

Nepal has a Maoist government sympathetic to China, its Premier visited China first in a break of protocol. India used to be the first port of call.

Chinese have started supplying missiles and launch pads to Bangladesh. The Chinese have supplied C-802A anti ship cruise missiles to Bangladesh which have a 120 kms range. With superior anti-jamming facilities, it hit ratio is an exceptional 98%.

The Chinese have supplied sophisticated 3D radars to Sri Lanka. To add insult to injury, Sri Lankan army has started buying Pakistani weapons using Iranian money. India supplied 2 D radars and clearly managed this game badly. We should have offered 3 D radars and avoided this.

Having said that, given the chaos in Kashmir and in Pakistan, India is faced with an extremely cunning and hostile China.

However, it is extremely difficult, if not impossible, for Chinese to attack India and win a war (I will give a Stratfor article that will explain all this excellently), but they can take Tawang in Arunachal Pradesh, and that will be a major psychological blow for India. Some battles are not won in the battlefields only!

India’s options :

1. Air force multiplers to be based in North East & Ladakh: Status – In Progress (The IAF is on course to base two squadrons (some 40 aircraft) of Sukhois, which have a cruising speed of 3,200 km, at Tezpur to counterbalance a Chinese threat on the eastern front. The air force has contracted some 230 Sukhoi-30MKI fighters from Russia in orders totaling over US $ 8.5-billion. The Ladakh sector has come to occupy lofty status in the IAF’s calculus as was evident when it reactivated the 2.1-km airstrip at Daulat Beg Oldi (DBO) in northeastern Ladakh after 43 years.)

2. Army commando units based in forward positions – Done

3. Strengthen Tawang area by infrastructure, dams etc. Status – Not happening

4. Cross over to Chinese side and cause incursions – Not happening.

5. Internal sabotage through Tibetians and false flag recruitments of Uighur Muslims.

6. Giving Brahmos and other top range missiles to Singapore, Philippines, Vietnam, S.Korea, Taiwan (countries that view China with animosity).

7. China is pushing 500 million people from farms and villages into cities too soon. Although it gets almost no publicity, China is experiencing hundreds of demonstrations around the country, which is unprecedented. These are not students in Tiananmen Square. These are average citizens who are angry with the government for building chemical plants and polluting the water they drink and the air they breathe. India should extend help to FALUN GONG and many other anti-establishment groups (incl martial arts groups, theatre & arts groups etc) and create dissension.

Given the population graph, India can go into China and take Mt. Kailash – it is India’s and ordained in our sacred texts. China's underbelly is very sparsely populated. It is a price the Chinese should be made to pay for sitting on Aksai Chin. Sometimes, one has to shed inhibitions and project force. Psy-ops cannot be one sided.

How can India take over Mt Kailash? Well India will not, Tibet will. And Tibet being hostlile to China will lease or hand over the region to India. Hence India should start preparing the Tibetians for armed struggle against the Chinese. Tibet is the soft underbelly and a strong guirella force of 50,000 battle hardened (taken from ITBP and infiltrated back to China) would cause enough unrest. Simultaneously help mass uprisings in Chinese villages against mainland city centric China. India's goal should be Tibetian independance. Will write on this at a later blog.

And CPI(M) should be made to understand once and for all, CHINA is NOT A FRIEND OF INDIA. Not at all !!!


This article is written by George Friedman in Stratfor ( Stratfor is known in the intelligence circles as providing some cutting edge research and is seen by think tanks around the globe.

The article :

Chinese President Hu Jintao visited Washington last week for a meeting that diplomatically might be called "nonproductive" -- or, realistically, "disastrous." Not only was nothing settled, but a series of incidents -- ranging from a reporter shouting insults at Hu and being permitted to continue doing so for three minutes, to an announcement that the national anthem of "The Republic of China" (also known as Taiwan) was being played -- marred the visit, to say the least.

It is hard for us to believe that the admission of a Falun Gong member to the White House press pool would go unnoticed by the White House staff, or that it would take three full minutes to silence her. We are, sad to say, cynical people, and it is plausible that the insults were deliberate. The American side had been leaking for weeks that Hu would try to use the visit for his own political ends in China, and wanted to be granted every honor conceivable during the trip. The White House appeared irritated by this hubris, although it would, on the surface, appear quite natural for the United States and China to exchange full diplomatic courtesies.

Obviously, something serious is going on in Sino-U.S. relations. The United States has openly discussed a hedge strategy on China, under which economic relations would proceed while the United States increased its military presence in the region as a hedge against future trouble. China, for its part, has been more than a little troublesome in areas where the United States does not want it to be, particularly during the current confrontation with Iran.

China and the United States are bound together economically. That is one of the major problems, since they need very different things. The Chinese economy, as we have argued in the past, is not doing nearly as well as its growth rate would indicate. We won't rehash our views on that. However, the economic reality creates an obvious tension. Chinese exports are surging at very low or nonexistent profit margins in order to sustain a financial system that has accrued a nonperforming loan burden that is, by some measures, as high as 60 percent of gross domestic product. The United States is addicted to Chinese imports, and China is addicted to exporting to the United States. The United States wants China to revalue the yuan in order to raise the price of Chinese exports. The Chinese, eager to maintain and increase exports, have no intention of allowing a meaningful rise in the yuan.

There are other forces binding the two countries together as well. The most important is Chinese money -- which is flowing out to other countries precisely because China is no longer a particularly attractive place for Chinese investment. There is serious capital flight under way, as money is redeployed to safer havens. The safest haven from the Chinese point of view is the United States -- thus, Chinese investment there is surging. And the United States needs this money. In this sense, both countries are in a death-lock. There is no other economy that is as large, liquid and safe as the American economy. Chinese investors need their funds to be in the United States. And there is no larger pool of cash than China's to finance U.S. debt.

This means that there is no divorce looming in Sino-U.S. relations. But at the same time, it must be noted that, despite very close connections between China and Japan, Sino-Japanese relations have deteriorated remarkably -- and it is China that has driven the estrangement. The reasons are political: China's government has domestic problems, and patriotic fervor will tend to buttress Beijing's power. Japan is still deeply hated for its behavior in World War II, and attacking Japanese behavior is good politics. The Chinese have strained relations with Japan nearly to the breaking point.

What is important here is this: It must not be assumed that China is driven purely by economic considerations. In the case of Japan, Beijing clearly has subordinated the economic advantage of having smooth relations with Tokyo to its own domestic considerations. Now, Japan is not the United States -- it is a significant country for China, but not economically decisive in the way that the United States is. The Chinese have more room for maneuver there. At the same time, it must be understood that China is playing a complex game, and while making money is up there on the priority list, it is not the only thing up there. Preserving national unity in the face of centrifugal forces and foreign power also matters a great deal to the Chinese.

It is therefore time to stop to consider China's national strategy in the long run, and therefore, to consider China's geopolitics.

The Geography Factor

Beginning, as is necessary, with the outlines of China's national boundaries, we are immediately struck by the fact that China is, in many ways, an island.

To the east are the South and East China Seas.
To the northeast is Siberia, thinly inhabited and to a great extent uninhabitable. Some limited military expansion in that direction is possible, but a large population could not be sustained.
To the direct north is Mongolia -- occasionally part of China, occasionally the ruler of China, but currently a fairly unimportant area, not worth projecting force into.

To the southwest are the Himalayas. There is frequent talk of India as balancing China, but this is, in fact, meaningless. They are as much separated as if there were a wall. There can be skirmishes along the dividing line in the Himalayas, but no massive movement of armies.

In the southeast, there is Indochina. China could expand there, but the last time there were land-based skirmishes, in 1979, Vietnam beat the Chinese soundly (though both sides claimed victory). Jungles and mountains stretching from eastern India to the South China Sea make that region impassable, even without the need for self-defense. Finally, there are the western approaches into Central Asia, through Kazakhstan. This has been the traditional, and in some ways only, route for Chinese aggression. China is certainly deeply involved in Central Asia, but its own region of Xinjiang is both Muslim and hostile to Beijing. It does not provide a base for launching invasions, even if one was wanted.

For these reasons, China must be viewed as one of the most insular great powers in the world. It has occupied most of the terrain that is accessible to it; what remains is either inaccessible, undesirable or quite able to defend itself. China's great interest, therefore, should be the oceans. Over the past 20 years, China has become a major exporter and thus should have a great interest in securing its sea lanes. But China's coastal waters are effectively controlled by the U.S. 7th Fleet. Constructing a navy that could challenge the U.S. Navy would take a fortune, which China probably has, but also one or two generations would be needed -- not only for construction, but for establishing a military culture suitable for an aggressive naval force.

Most important, challenging the U.S. Navy with a Chinese navy cannot be done regionally. The United States has fleets other than the 7th Fleet, and if the U.S. Navy were concentrated against China, the Chinese could not fight a defensive battle. They would have to take the fight to the Americans, and that would mean fielding a global naval force. China might one day have that, but they do not have it now. In this sense, the standard concerns about a Chinese invasion of Taiwan are not realistic. China does not have a naval force capable of taking control of the Taiwan Strait, nor the amphibious force needed to gain significant lodgment in Taiwan, nor therefore -- and this is the key -- the ability to sustain a multidivisional force in Taiwan.

The Internal Divide

China does not have many regional options with conventional forces nor, for that matter, does it face a conventional threat from within the region. China's primary geopolitical problem, and thus its chief military mission, is domestic. China is a highly diverse and fragmented country; maintaining control of the current extent of the country is the major strategic problem. Unlike most nations, whose external geopolitical problems define their military thinking, China's internal geopolitical problems drive its military planning.

There are two dimensions to these problems. The first is ethnic: China occupies areas like Xinjiang, Tibet and Manchuria that are ethnically distinct and sometimes restive. The other and deeper problem, however, is not ethnic but regional. China has a large coastal plain. It also has a vast interior that is mountainous. The tension between those two regions historically has been a great challenge that China has faced.

The interior is heavily driven by agriculture -- subsistence agriculture. It is extraordinarily poor, and arable land is minimal. The coastal regions are relatively better off, to the extent to which they conduct international trade through coastal ports. Thus, China has had two realities. In one, the coastal regions were cut off from the rest of the world, and there was a rough equality between the regions. Until the British showed up in the 19th century, for example, trading with foreigners had been illegal. After the British forced China open, the coastal regions boomed, and the country fragmented; the coastal regions, manipulated by foreigners who were in turn manipulated, turned outward to the ocean, while the interior stagnated. Mao tried to create a revolution in Shanghai and failed. Instead, he went on his Long March to Yenan in the interior, raised a peasant army from there, and came back to conquer the coast. He also closed off China from the world, creating poverty but relative unity.

Deng gambled with the idea that he would be able to have his cake and eat it too. He opened China to the world, thereby enriching the coastal regions and recreating the tension that Mao had sought to abolish. For 30 years, Deng's gamble worked. Now it is breaking down. Beijing is urgently trying to shift resources from the wealthy coastal regions to the restive interior. The coastal provinces naturally are resisting. The great question is whether Beijing will be able to juggle the two realities, whether China will again turn inward to maintain geopolitical integrity or if it will fragment further into warring regions.

Balancing the two indefinitely is the least likely outcome. But China does have one other card to play, which is patriotism. The Communist Party has little legitimacy at this point, but the idea of China -- particularly among ethnic Chinese of whatever region -- is not a trivial driver. In order to generate patriotic fervor, however, there must be a threat and an enemy. At this point, the Chinese are using the Japanese in order to sustain patriotism. Reclaiming Taiwan would stir the spirits and reduce regional tensions, but this, as we have pointed out, would be militarily difficult in any conventional way. Moreover, it would bring a confrontation with the United States.

Priorities and Options

If we accept the idea that maintaining the territorial integrity of China is its greatest geopolitical imperative and that regional prosperity comes second for Beijing, it follows that the government will attempt to impose its will on the coast, and trade and economic concerns will come second. Beijing's interest in having smooth trade relations wanes, both because the wealth gap exacerbates tensions between the regions and because the interest runs counter to its need for external confrontation. It follows from this that China's primary interest -- and ability -- would be to maintain security in China, and that foreign adventures would be avoided except under circumstances in which they would have a high probability of success and would serve internal political interests.

A secondary goal would be to protect China's coast from foreign encroachment. Imagine the following scenario: Business and Party interests in the coastal region are resisting Beijing's efforts to bring them under control and impose taxes. The situation becomes unstable, and Western interests, investments and the expatriate community living there are jeopardized. Through some political contrivance, these local leaders position themselves as the regional authority and ask for American intervention. The United States decides to intervene. Given that this is roughly what happened in the late 19th and early 20th centuries in China -- during which time there was a major American presence in Shanghai -- it is not as far-fetched as it might seem.

Under these circumstances, the government in Beijing would be forced to resist or abdicate. So, if the primary interest of China is the maintenance of internal security, a secondary interest would be deterring foreign interventions in the event of instability. The tertiary interest would be some form of force projection in the region, particularly against Taiwan -- which not only could be regarded as an internal security matter but would provide the regime with patriotic credibility.

If we accept the premises that China's major resources will go to the army for security purposes, and that China is at least a generation away from having a significant naval force, then what military options do the Chinese have? Obviously, one is its nuclear force. That is a serious deterrent; nations have attacked nuclear powers (Egypt and Syria against Israel in 1973) but not for the fairly marginal reasons the United States might have to get involved in China at some hypothetical future date. But given that deterrence runs both ways, nuclear stalemate always leaves opportunities for subnuclear threats.

The prime military lever within China's reach is not sea-lane control, but rather sea-lane denial. Using anti-ship missiles, the Chinese could impose heavy attrition on the sea-lanes leading to Taiwan and even potentially interdict Japan's sea-lanes. This would not guarantee China control of the sea-lanes, and that is a problem if China is importing oil by sea. However, in extremis, it would hurt Taiwan and Japan more than China. And if the Chinese had systems that could threaten to overload U.S. Aegis and follow-on systems designed to protect warships, then it could force the 7th Fleet to retreat as well. The tactic would serve as a deterrent against intervention and as a suitable secondary system to supplement the army. It would also serve as a threat to the interests, if not the survival, of Taiwan.

All of this is of course hypothetical and speculative. It assumes that the current trends in Chinese relations with Japan and the United States are merely road bumps rather than fundamental shifts in China's pattern. But given that China does shift its pattern every 30 years or so, and that the stresses on China make it reasonable to expect some shift -- and finally, given that there is a trend toward increased tensions in play -- it is not unreasonable to think of China in a different way than has been customary. China has been seen by Americans as a giant money factory. It is that, but it is both less than that and more. It is a great power facing other great powers, and a superpower. And while the scenarios here are extreme, thinking about the extremes can be useful.