China’s Rural Land Grabs: Endangering Social Stability

Last month Chinese Academy of Social Sciences, the top think tank in China released the findings of a rural survey, in which 60 percent of the farmers in 1,564 surveyed villages in 17 provinces and autonomous regions revealed that their land has been confiscated, and that they were unsatisfied with the compensation they received. The report was silent on the number of illegal confiscations, however, reported that “Illegal land confiscation has become the biggest threat to Chinese farmers' land rights and conflicts related to land have become a threat to the stability of China's rural society.” In response to the report, a recent circular published on the Chinese government's website (www.gov.cn) has warned the provincial governments over the evictions of farmers from their lands.

China has lost millions of hectares of arable land since the reforms. In recent years, in order to regain some of the lost land, the Chinese government has initiated reforms in some of the selected rural areas that encourage the rural people to move from their old homes into new residential buildings while the houses would be demolished and land cultivated into farmland. The move is designed to add farmland while improving farmers' living conditions, albeit has suffered criticism from top agriculture scientist such as Lin Yifu, Lin observes that it would be catastrophic to destroy the natural villages and construct mini cities (xiuzhen chengshi) in the villages. The Ministry of Land and Resources admitted recently that the provincial governments in more than 20 provinces have been found to have forced farmers to abandon their homes and to move into apartment buildings. The provincial governments, in order to boost their political image and local revenues and GDP, sell the right of land use to developers. The forced evictions has been a cause of concern for the central government, as the resentment has resulted into various modes of protests, petitions, demonstrations, sit-ins and even confrontation with the local government machinery. What are the reasons behind such forced evictions? The most important that the Chinese government has been grappling with is the land use policy.

The land in rural China belongs to collective organizations according to Land Contracting Law (tudi chengbaofa) LCL. The collectives in turn contract the land to peasants through the Household Responsibility System (HRS) that was implemented during the 1980s. However, there is another law called Land Management Law (tudi guanlifa) LML, that makes it mandatory for the peasants to vacate arable land for urbanization and industrialization. Both the Laws have been used by the central as well local governments to their own advantage and have forced various villagers in the city suburbs and rural areas to vacate their land at the issuance of a single eviction notice. Secondly, along with the HRS came the system of land readjustment meant to provide for egalitarian distribution of land (which anyhow is a thing of the past now) but created problems. From its extensive fieldwork in China’s 17 provinces since 1987, the Rural Development Institute (RDI) of the Chinese Academy of Social Sciences where this author was a visiting fellow during 2006-07 found out that it was the readjustment of land that made peasantry apprehensive about further inputs and investment in their land on account of adjustments and the transfer of land right. 

In the light of these problems, since 1988 based on its fieldwork findings, the RDI recommended to the Chinese policymakers that there was an urgent need to bring in additional laws and policies to increase the tenure security and well-being of China’s rural population. Government responded positively to these recommendations and brought in a 30-year land use rights policy as a legal requirement in a new land management law in 1998. In August 2002, the Standing Committee of the National Peoples’ Committee adopted Rural Land Contracting Law (RLCL) which offered substantial additional assurance of farmers’ 30-year rights, narrowing any possible remaining grounds for readjustments, detailing what is to be in the written contract, explicit equal land right for women and setting forth a comprehensive range of remedies for farmers whose land rights are violated. The RLCL spells out, for the first time, farmers’ rights to carry out transactions with their land rights, including not only lease, but assignment of the full 30-year right.

In order to implement the RLCL and other related policies, the Chinese government brought in other regulations such as the “Contractual management right transfer method of rural land” which was approved by the 2nd standing meeting of the Ministry of Agriculture (MOA) on January 7, 2005, and went into effect on March 1, 2005. The new regulation allowed the peasants to transfer their contracted land to other parties and stipulated that the income originating from such transfers should go to the contractor alone. The grantee could subcontract the land but has to acquire the accent of former contractor. According to the 2006 white paper of the MOA, 5% of the contracted land area was voluntarily subcontracted, transferred, hired and mutually exchanged by the contractor in 2005. Furthermore, in order to settle the disputes originating from such transfers, the MOA is working on arbitration for land conflict management. 

Perhaps because of growing pressure to increase land for non-agricultural uses especially the lucrative real estate developments, local governments, who monopolize the sale of land-use rights, are making huge profits by buying land from farmers at low prices, and selling it to developers at higher prices. Such profits have become a “secondary source of revenue” in some localities, resulting in rampant corruption. The move of the local governments has forced peasants to voice their frustration and discontent in various ways throughout China. The protests have forced the government to readjust its land policy and bring the farmland under strict control and promote the reform of the government’s land requisition and land management systems. Li Jianqin, Director of the Law Enforcement and Supervision Bureau under the Ministry of Land and Resources, revealed that there were a total of 53,000 cases of illegal land use across the country in 2010,  involving 27,866 hectares of land including 10,933 hectares  of farmland (China Daily January 21, 2011). Rampant illegal land expropriation has prompted the Ministry of Land and Resources and the National Development and Reform Commission to promulgate two catalogues in 2006, which banned the construction of large commercial and entertainment facilities, building material markets, and theme parks using arable land.

China’s economic growth has been driven by heavy investment in infrastructural and real estate development. Since investment requires land, China witnessed three “land enclosure rushes” (quandire). The first was during mid 1980s when cities expanded, town and township enterprises mushroomed and peasants started to build new houses. In 1985 alone China lost some 15 million mu (one mu equals 1/15 of a hectare) arable land. From 1978 to 1986, arable land in China shrank by 6 million mu per year. The second ‘land enclosure rush’ was witnessed between 1992 and 1993 in the form of land speculation. Haikou in Hainan and Beihai in Guangxi are the examples where huge arable land was seized for constructing commercial houses (shangpin fang). The third land enclosures took place between 2002 and 2004 when the government invited and sold land to developers at a very low price. Between 1998 and 2005 China lost around 10 million hectares of arable land. The fourth appears to be driven by government’s resolve to convert rural population into non rural by building ‘mini cities’ in the rural areas.

It is widely believed by many Chinese scholars that the reform of rural land management is crux to resolve the “Three rural” (widely used for agriculture, countryside and peasants) problems. Since land does not belong to the peasants, they do not have bargaining rights in the course of land acquisition by central or local governments. As a result peasants only get a part of the added value of land; the lion’s share is taken away by the government and the market intermediaries. Liu, Jihong from the Department of Agricultural Economic Management, of MOA is more vocal in his approach when he says that the land acquisition system is highly discriminatory against farmers. According to Liu, ever since the economic reforms started, some 100 million mu of land was used for urbanization and industrialization. Even if there exists a profit margin of 20000 RMB per mu, the amount reaches a whopping 200 billion RMB. In the process millions of Chinese peasants lost their land through naked exploitation and in violation of peasants’ rights. Pointing to land acquired for construction, Liu points out that at present some 2.5 million to 3 million mu of agricultural land is used for construction every year. Even if we calculate an average per capita loss of 1 mu, some 2.5 million to 3 million peasants are rendered landless every year. Adding peasants who lost their land during the last 20 years or so, it is estimated that in coming 30 years some 100 million peasants would be turned into non agricultural population. With a note of warning, Liu posits that if these people are not rehabilitated properly, millions would be reduced to poverty and social stability would be endangered. Therefore, Liu advocates that as long as permanent land rights are denied to peasants more and more peasants would be rendered landless and homeless, and would cause instability in society. In light of these facts, the present HRS is not conducive to stabilization of land rights as well as deals negotiated by the market forces. Therefore, China needs a second land revolution.     

On Wen Jiabao’s Government Work Report 2011

At the outset, Wen Jiabao’s Government Work Report of 2011 is different from other government reports presented hereunto by the Chinese Premiers. Instead of starting with the summary of the achievements of the past one year, this time Wen summarized the work done by his government in the last five years i.e. during the 11^th Five Year Plan (2006-2010); he then sets major targets to be achieved in the next five years, during the 12^th Five Year Plan (2011-2015), and finally elaborates what are his immediate priorities for the year 2011.

As regards the achievements in the last five years, the Chinese government compliments the leadership and the countrymen for a wonderful job of maintaining the high economic growth trajectory, especially in the face of world economic meltdown that severely hit the exports in China and rendered millions jobless. And also in the face of unprecedented natural calamities such as Wenchuan and Yushu earthquakes, China seems to have kept its overall economic as well as social environment shockproof, and steered itself out of various uncertainties. The economy continued to grow at an average growth rate of over 11.2% and in specific years it even grew at 14% e.g. the year 2007. It became a 5 trillion dollar economy replacing Japan to become the 2nd largest economy of the world even though the per capita income remains around 4000 USD per annum. Therefore, in the face of very slow economic development across globe, India being an exception, one may surmise that China along with other emerging economies such as India, Brazil and Russia has contributed to the stabilization of the world economy.

It could be discerned that the ‘Three Rurals’, a term used for the agriculture, countryside and peasants remained the top priority of the Chinese government during the last 5 years. The accumulative investment for the ‘Three Rurals’ reached over 3 trillion yuan, registering 23% increase annually. The net per capita of the rural China touched 5919 yuan. However, various concerns pertaining to the inflation, job creation, income disparity etc. are obvious in the report and have been prioritized for immediate action in the year 2011. In particular, inflation remains high on the government agenda, and that’s why we hear Wen using terms such as ‘controlling commodity prices’, ‘managing inflation’, ‘maintaining overall price stability’, ‘macro economic control’, ‘supervision of prices’  etc. measures as ‘top priorities’ for the government.  Comparing India, China should not have a problem to deal with the inflation as it has registered very impressive food grain output in the last five years; the industrial production has also been superb, and moreover with over 1.3 trillion dollar foreign reserves the problem should not be too hard to handle.

Nevertheless, the most crucial issue for the Chinese government in the coming years would be the growing income disparity and the distribution of the incomes; it has to be seen how China will unfold the policies to tackle these problems. These are the issues that are very crucial for overall social stability in China. China is very nervous about any public protest, and most of the protests have been rooted in expanding social imbalances, especially the rural urban divide, official highhandedness, corruption, violation of laws, land fragmentation, land acquisition leading to forced evictions, unemployment, unnecessary cadre strength in the countryside, environmental hazards etc. issues. Reuters reported on March 5, 2011 that China's spending on "public security" has outstripped the defense budget for the first time. The planned spending on law and order items has been pegged at 624.4 billion yuan ($95.0 billion) for the year 2011.

As far as the 12^th Five Year Plan is concerned, it would be the crucial period for building a modest well off society, deepening the reforms, as well the acceleration and transformation of the economic development in China. China plans to moves away from the labor intensive industries to the higher end manufacturing and service industries. China would like to shed the image of being viewed as the ‘world factory’ and venture in becoming the R&D hub of the world. To this end, 2.2% of the GDP would be spent on R&D.  Wen has also pledged to build 36 million affordable apartments for low-income people, and creation of 9 million jobs in the year 2011, and we can expect rise in the wages and incomes of the working class. Chinese premier has projected a growth rate of 7% which is not bad or slow at all during the 12^th Five Year Plan. He has projected that by 2015 China’s GDP at 2010 prices should reach over 55 trillion yuan (over 8 trillion USD). According to a study conducted by Price Waterhouse Cooper, China will be the largest economy in the world by 2020 and will replace the US by 2030. Therefore, there will be major shifts in the world economic order by 2020 in which emerging economies will become more important thus further enhancing their economic as well as political clout at the world stage. China also intends to control its population at 1.39 billion and an urbanization level of 51.5% by the year 2015.

As regards the priorities for the year 2011, Chinese premier says that since 2011 is the opening year of the 12^th Five Year Plan, it would be extremely crucial for accomplishing the tasks of the next five years. China will increase its GDP by around 8 percent, further optimize the economic structure, keep the consumer price index increase around 4 percent, create more than 9 million jobs in urban area and keep the registered urban unemployment rate at 4.6 percent or lower, according to the report. The agriculture will continue to dominate the government proceedings in 2011 as well, as the central government’s outlay for the ‘Three Rurals’ has been proposed at 988.45 billion yuan, an increase of 130.48 billion yuan over the year 2010. Meanwhile, China would continue with the practice of food subsidies to the farmers. Carbon dioxide emission is set to be slashed by 17 percent in the five years on the basis of 2010, as part of the country's active efforts to grapple with climate change. The reduction target will move China closer to achieve its pledge to cut carbon intensity by 40 to 45 percent by 2020, relative to 2005 levels, reveals the report.

As regards the national defense, there is a single paragraph in the Government Work Report that says that Strengthening of the national defense and building of a strong people's army is an important guarantee to safeguard the national sovereignty and security. It states that a strong army is also crucial for building a moderately well off society. The report says China will build capacity to win local wars in an information age, and to respond to multiple security threats and accomplish a diverse array of military tasks. The military will resolutely carry out urgent, difficult, dangerous and daunting tasks, such as handling emergencies and relieving disasters. There is no mention of the defense budget in the report, however, China reveled before the start of the NPC session that it plans to raise its defense budget by 12.7 percent to 601 billion yuan (91.5 billion U.S. dollars) in 2011, compared to an increase of 7.5 percent last year. While answering foreign journalists questions, Li Zhaoxing, spokesman for the Fourth Session of the 11th National People's Congress said that while China's military spending amounts to about 1.4 percent of its GDP, India’s ratio was much higher than 2 percent. In his budget speech on February 28, 2011, Finance Minister Pranab Mukherjee announced Rs 1,64,425 crore (US$ 36 billion) for defense during the next financial year 2011-12, which over 2.5 times less than the Chinese official budget.

Finally, the Chinese premier promises to be the standard bearer of peace, development and harmony. He says China will take an active part in multilateral diplomacy, use the G20 summit and other diplomatic forums for strengthening the coordination of macroeconomic policies, and advance the reforms of the international economic and financial system such as IMF and the World Bank. The report says that China will maintain sound and steady relations with major powers. As far as relations with its neighbors are concerned, China has promised to adhere to the thesis of ‘good neighborliness and neighbors as partners.’ It also talks about promoting regional and sub regional cooperation. The last 32 years of economic reforms has brought earthshaking changes to the socio-economic fabric of China, what could be the direction of the wind in the next decade for China, well, we will have to wait and watch.

Jasmine Revolution and Social Stability in China

The ‘Jasmine Revolution’ (JR) that began in Tunisia and spread like a prairie fire to Egypt, Libya, Yemen, Bahrain, Algeria, Jordan and  Oman etc. middle east dictatorial regimes has also made its reverberations felt in China and made the authorities jittery and nervous. The organizers of the JR are primarily overseas Chinese inciting the Chinese people to follow the JR suit in China, and demand freedom and democracy, political reforms and an end to the one party rule. Even Ma Yingjiu, the Taiwanese president resonated during the commemoration ceremony of the February 28 Incident [1947], infamous for Kuomintang’s white terror in Taiwan that the incidents starting from the 2.28 and right up to the recent turbulent Jasmine Revolution around the world,  is a reflection of peoples struggle for the protection of their human rights and democratic freedoms. 

During the initial phase, starting from February 20, 2011, the organizers of the JR called for demonstrations in the 13 cities across China. The protests failed to take place in most of the cities except the downtowns of Beijing and Shanghai. In the second phase, they have asked their supporters to ‘go for a stroll’ in 23 second tier cities across China and express their displeasure at the lack of political reforms and rampant corruption. The government has been swift in banning the word ‘Jasmine’ over the internet, and harsh in putting down the dissent wherever there is a slight brewing. Many protesters including a Chengdu based writer and blogger, Ran Yafei has been held on charges of ‘subversion of state authority.’ Zhou Yongkang, a 9^th ranking Politburo Standing Committee member of the Communist Party of China, who has also served as the Minister of Public Security between 2002 and 2007 urged to senior officials recently that they must improve the ‘social management’ and ‘detect conflicts and problems early on.’ Ma Zhaoxu, Spokesperson of the Chinese Ministry of Foreign Affairs even went on urging Libya to restore ‘social stability’ at the earliest in a recent news briefing.

Why China has been so nervous about the JR and public protests? The findings of various researchers, western as well as Chinese, including the Chinese Academy of Social Sciences, the biggest government think-tank shows that China has been witnessing between 80,000 and 90,000 cases of mass protests every year since 2006, and Zhou Yongkang the then Minister of Public Security has admitted this in public. The forms of protests have been parades, demonstrations, sit-ins, petitions, and in extreme cases self immolations. The situation has been largely ameliorated thanks to the abolition of agricultural tax and levies legislation in 2006. The root cause of these protests have been expanding social imbalances, especially the rural urban divide, official highhandedness, corruption, violation of laws, land fragmentation, land acquisition leading to forced evictions, unemployment, unnecessary cadre strength in the countryside, environmental hazards etc. issues. In the last decade alone, China lost some 10 million hectares of arable land primarily owing to construction, agriculture restructuring, afforestation and natural calamities. The equitable distribution of the land among the peasants is a thing of the past, new rural population those who are already adults are landless and only option for these young people is to be the migrant laborers. Owing to the discriminatory nature of the ‘permanent residency’ regime, they are orphans in the cities and cannot enjoy and afford basic human needs such as health and education in the cities for their wards.

These have factored in various social evils of loot arson and killing as well as some other societal disorders such as a local clinic doctor, stabbing eight students to death and injuring five others in a primary school in Fujian province last year; a man barging into a kindergarten in Jiangsu province and wounded 32 students with a knife on April 29, 2010; another person killing seven children and two women in a kindergarten in Shaanxi province in the same year, and the list goes on. In view of these incidents, the government has opened various ‘stability maintenance’ offices in migrant labor community dwellings in various cities. These ‘offices’ handle minor disputes and complaints, and reports greater risks of unrest to higher authorities. The ‘offices’ also provide help to the wards of migrant laborers in terms of education and day care facilities for smaller children. According to the statistics provided by the municipal government of Guangzhou, the municipality spent over 650 million dollars in maintaining ‘social stability’ in 2007, which was more than the money spent on social security in the same year.

Social stability in China not only impinges on domestic and economic stability but also on China’s foreign exchange policy. In the words of Chinese Premier Wen Jiabao, “if the Yuan saw a one-off large appreciation that would cause many closures of our processing enterprises and make many export orders shift to other countries and many of our workers will lose jobs.” The loss of jobs would translate into more ‘mass protests’ in China and impact on social stability. At present China is spending exorbitant amounts on public security. Forget about JR calls, any small gathering at any place across China makes China nervous.

History of the mankind reveals that social problems cannot be solved by force. The state can suppress or silence the issue for time being, but would resurface and abrupt with a greater force if left unattended. In order to ameliorate the situation, only way out to do away with some of the social imbalances is by initiating uniform permanent residency and employment system, uniform rural urban property, education and health rather social guarantee system, reasonable distribution of the financial capital in rural and urban areas etc. measures. These measures may temporarily reduce the scale of the dissent; however, will not put an end to these. Guoyu, a classic entailing earliest history of some of the Chinese states between 990BC -453BC has a following piece that is equally relevant even today. Shao Mugong, a minister of emperor Li of Zhou kingdom tries to reason it out with the emperor that he should let the people to exercise their right of freedom to speech. He tells the emperor that one cannot silence the people by terror and highhandedness, for to shut peoples’ mouth is more dangerous than clogging the waters of a river. A clogged river will break it dykes and bring misery to many a people. We harness a river by making canals so that water flows smoothly. In order to govern the people, the ruler must not interfere in their affairs, allow them to express themselves … how can you cork their mouths, and for how long? The emperor did not care much for his minister’s advice, the people rose in revolt and the emperor was forced to live in exile.

On China's White Paper on National Defense 2010

China on March 31, 2011 issued a White Paper on “China’s National Defense in 2010” The document is the seventh in series since the Chinese government issued a White Paper on defense in 1998. The entire text of the document has 28,600 Chinese characters consisting of preface, security scenario, national defense policy, the modernization of the People’s Liberation Army (PLA), the application of the armed forces, the building of reserve forces and defense mobilization, the military legal system, defense industry, defense spending, the establishment of military mutual trust, and arms control and disarmament etc. components.

The White Paper builds on the existing features of the earlier white papers, and has perfected and enriched the framework and basic contents of the subject matter. Compared with the previous white papers, there are nine major highlights in 2010 document. At the outset it expounds China’s interaction with the world, and intertwine the fundamental interests of the Chinese people with the common interests of the people of the world, China's development and the development of the world, China's security and the world peace, and underscores the importance of building even more intimate relationship with the world at new historical starting point. It systematically, analyses the new trends in the international balance of power, and China’s relations with traditional major powers, emerging powers, neighboring countries as well as those with the developing countries.

It deals with the profound and complex changes that have characterized the international security situation, and confirms that peace, development and cooperation remains an irreversible trend of the times. It also highlights the increased level of international strategic competition as regards the international order, comprehensive national strength, geo-politics, as well as the new contours and adjustments in the Asia-Pacific strategic architecture.

The new White Paper stresses that China's overall security environment remains favorable to it, however, the security challenges it faces have become more diverse and complex, and that while building a moderately prosperous society, the task of safeguarding national security, especially in the face of vast territory and coastal line remains heavy. It says that in the process of safeguarding national security, China will adhere to the comprehensive security, cooperative security, the concept of common security, and pursue a policy of mutual trust and benefits, equality and coordination.

The White Paper for the first time has explored the issue of establishing mechanism of cross-strait military and security mutual trust. It lauds the progress in enhancing and building political mutual trust with Taiwan through a variety of agreements such as direct transport and trade links. It admits that the forces of “Taiwan independence”, “East Turkistan independence” and “Tibet independence” have inflicted serious damage on national security and social stability. However, the paper says that the Taiwan and China may discuss political relations in the special situation, and hold contacts and exchanges on military issues at an appropriate time and talk about a military security mechanism of mutual trust.

As regards China’s defense policy, the White Paper reiterates China’s resolve to pursue a defensive policy, which it says is determined by China's development path, its fundamental aims, its foreign policy, and its historical and cultural traditions. The defensive policy is based on objective realities and historical necessity declares the paper. The road of peaceful development, adopted since 2006 in the place of peaceful rise is emphasized along with China’s strive to build a harmonious socialist society internally, and a harmonious world externally on the principles of common security and prosperity.

The White Paper also summaries the tasks and goals of China's national defense in the new era, which are stated as  1) Safeguarding national sovereignty, security and interests of national development; 2) Maintaining social harmony and stability; 3) Accelerating the modernization of national defense and the armed forces; and 4) Maintaining world peace and stability.  It is for the first time that the White Paper dedicates a special section on PLA’s modernization. It reviews the process of PLA’s modernization in the past 60 years, and says that in the process it has grown from a single service into a strong military force featuring a range of services and arms, and is now beginning to make progress towards informationization. The document separately focuses on the state and modernization of PLA Ground Force (PLAGF), Air Force (PLAAF), Navy (PLAN), and the Second Artillery Force (PLASAF) etc. It reiterates the goal of accomplishing mechanization and attaining major progress in informationization by 2020. The strategic combat capabilities that are considered necessary to win informationized warfare under integrated joint operations are tacitly pronounced as C4ISR; precision strikes; rapid deployment; and support and logistic capability. The White Paper maintains that the fighting capabilities of the armed forces in conditions of informationization have been significantly raised under joint operation systems, which is the focal point of its modernization. Furthermore, the cyber space has been included as a key national defense consideration for the first time.

It also for the first time specifies the diverse applicability of the PLA in peace time. The White Paper declares that China pursues the principles of combining peacetime needs with wartime needs, and strives to foster a military security environment featuring mutual trust and benefits. Giving an account of PLA’s foreign exchanges, the documents points out that in the last two years, senior PLA delegations have visited more than 40 countries, and defense ministers and chiefs of general staff from more than 60 countries have visited China. The visits are viewed as military confidence-building measures, which are considered necessary and effective for maintaining national security and development, as well as for safeguarding regional peace and stability. It declares that with political mutual trust as the groundwork and common security as the goal, China is promoting the establishment of equal, mutually beneficial and effective mechanisms for military confidence-building, which should be based on the principles of holding consultations on an equal footing, mutual respect for core interests and recognition of major security concerns, not targeting at any third country, and not threatening or harming other countries' security and stability. It may be noted that China has all along considered Taiwan, Tibet and Xinjiang as its core interests, however, have added South China Sea to the list of its core interests last year. The interpretation of South China Sea being China’s core interest has been disputed by many littoral states such as Vietnam, Malaysia, Philippines and even Taiwan.

Final section of the White Paper is dedicated to arms control and disarmament and says that China attaches importance to and takes an active part in international efforts in the field of arms control, disarmament and non-proliferation. It rests its faith in the United Nations and lauds UN role towards the same. It states that existing multilateral arms control, disarmament and non-proliferation systems should be consolidated and strengthened, that the legitimate and reasonable security concerns of all countries should be respected and accommodated, and that global strategic balance and stability should be maintained.

As far as India is concerned, it figures at eight places in the document. The reference is made in the context of joint military exercises and training; the defense and security consultations with neighboring countries; and the Confidence Building Measure agreements signed in the year 1993 and 1996. In final analysis the series of White Papers on defense demonstrates China’s economic as well as military self assurance. It is also an attempt to enhance the level of transparency as regards military spending, its defense policy and goals, and hence to showcase China as a responsible stakeholder in the global system.  

Dalai Lama’s retirement and Tibet issue

On the occasion of the 52nd anniversary of the March 10 Tibetan Uprising, the Dalai Lama announced his retirement as the political head of the ‘Tibetan government-in-exile’ (TGIE) and said that he would hand over his “formal authority” to a “freely-elected” leader. He remarked that “The decision to devolve authority has not been taken because I feel disheartened. It is to benefit the Tibetans in the longer run. I feel, gradually people will come to understand my intention and will support my decision and let it take effect.” The Dalai Lama is likely to put it formally before the TGIE on Monday, however, the latter need to amend the Tibetan Charter which makes the Dalai Lama as the head of state, and also the political and administrative head of Tibetans. The Tibetan émigrés across the world will elect a new parliament by universal franchise on March 20, 2011. By devolving his powers, the Dalai Lama hopes to give the ‘Prime Minister’ greater clout as the region seeks autonomy from China.

As the Dalai Lama is aging, he would like to devolve powers to elected heads of the TGIE, so as a legitimate leadership evolves during his lifetime and continues the struggle for ‘genuine autonomy’ within the Chinese constitution even when he is not around. He does not want to see the Tibetan movement going astray, as there is already a constituency amongst the émigrés which have been disillusioned by the ‘middle way approach’ of the Dalai Lama and are asking for complete independence rather than ‘genuine autonomy’. However, it has been widely believed that the institutions established by the Tibetan émigrés have been largely democratized and are capable of steering the struggle ahead even in the absence of the Dalai Lama.

On the other hand, the Tibetan émigrés are also unanimous when it comes to the political and religious clout of the Dalai Lama among the Tibetans as well as international community. Therefore, it is unlikely that the Tibetan Parliament will agree to the Dalai Lama’s retirement. Professor Samdhong Rinpoche has already made it clear that “The TGIE might not have that legitimacy in eyes of Tibetans in case the Dalai Lama withdraws as temporal and political head of the institution.” Furthermore, China may further harden its stance as regards the talks between the envoys of the Dalai Lama and the Chinese government. In case the Tibetan chose envoys from the elected ‘government,’ China is unlikely to give its approval and the negotiations may be stalled further. The retirement according to Rinpoche will also create a political deadlock in the Tibetan ‘parliament’ in exile.

Long before the Dalai Lama’s announcement, China has once again spouted venom at the Nobel Laureate amidst the ongoing session of the National People’s Congress (NPC) and the National People’s Political Consultative Conference (NPPCC). Zhang Qingli, the general secretary of the Communist Party in Tibet, reiterated on March 7th 2011 that the Dalai Lama is a “wolf in monk's robes” a derogatory term widely used by him and others during the March 2008 riots in Tibet. Zhang said that he actually quoted the words of Zhou Enlai to describe the Dalai Lama in that way. Zhang also made comparisons between the Dalai Lama and Rebiya Kadeer, a Uygur separatist leader from Xinjiang. Zhang however did not rule out the possibility of 2008 style riots in Tibet, but remarked that the current situation in Tibet was generally stable.

Reacting to the Dalai Lama’s announcement of retirement,  Qiangba Puncog, Chairman of the Standing Committee of the Tibet Autonomous Region's People's Congress said on the sidelines of the NPC session on March 11, that the announcement is “absolutely meaningless.” He said, “Since no country recognizes his self-declared ‘exiled Tibetan government’, whatever he does in his illegal political organization is nonsense and Tibet will not be affected at all.” Puncog admitted that the “Dalai Lama, as Living Buddha and a religious leader, does have some influence on his believers,” but also said that “his death is expected to have a minor impact on Tibet, the overall social situation will remain stable, and we are prepared to handle some minor turbulence after his death.” Jiang Yu, spokeswoman for the Ministry of Foreign Affairs, in the same vein castigated the Dalai Lama for his “tricks to deceive the international community,” and that he is a “political exile under a religious cloak and has long engaged in activities aimed at splitting apart China.”

The fundamental perceptions of the Tibetan émigrés and China are very diverging as regards the Tibet issue. As far as the Dalai Lama headed TGIE is concerned it has adopted the ‘middle way’ approach for the resolution of Tibet issue. In brief, the Dalai Lama demands “genuine autonomy” within the constitutional framework of the Peoples’ Republic of China. However, part one of the Strasbourg proposals that deal with the history of Tibet and deem Tibet as an independent country before 1949 is troublesome and has not gone well with the Chinese government. The second part is forward looking and deals with future of Tibet. China would remain responsible for Tibet’s foreign policy, but, Tibet would be governed by its own constitution. The government of Tibet would comprise a popular elected chief executive, a bicameral legislature and an independent legal system. The other major hurdle is the demand to restore whole of Tibet known as greater Tibet. The greater Tibet or the so called ‘Cholka –Sum’ is the ethnic Tibet which consisted of three provinces, namely, U Tsang, Kham and Amdo. The genuine autonomy is sought for the entire 6 million Tibetans in China, not just for 2.6 million Tibetans living in the Tibet Autonomous Region (TAR).

The organizations such as Tibetan Youth Congress (TYC), Tibetan Women’s Association (TWA), National Democratic Party of Tibet (NDPT), Gu-Chu-Sum Movement (GCSM) Students for a Free Tibet (SFT), the International Tibet Support Network (ITSN) and the Tibetan Writers Organization (TWO) etc. are pronounced by China as ‘radical’ organizations and at times have declared TYC as a terror outfit as well, have reservations about the middle way as offered by Dalai Lama  and have  more or less accepted the independence of Tibet as their ultimate goal besides other aims and objectives.

As far as China is concerned as it is evident from its reaction to the Dalai Lama’s announcement of retirement, it doesn’t accept the Dalai Lama’s proposals or the demand for ‘genuine autonomy’ and describe them as a ploy to seek independence, semi independence or even independence in disguised form, for according to China the Charter of the Tibetan in Exile promulgated in 1991 maintains that efforts shall be made to transform a future Tibet into a Federal Democratic Self-Governing Republic and a zone of peace throughout her three regions, and the Dalai Lama as a head of such a future entity.  According to An Caidan, a researcher from China’s Tibetology Research Centre in Beijing, the real motive of “genuine autonomy” could be best described as “sanbuqu” (Trilogy) to secure Tibetan independence: Firstly to secure the return of the Dalai Lama to Tibet through negotiations, for the Dalai clique has failed to achieve any success irrespective of engaging in independence activities for decades from outside China. In order to “directly and more effectively” command the pro independence activities, it is important to return home first. Secondly to gain political power through "genuine autonomy"; and 3) finally realize “Tibetan independence” through a “referendum.”

It could be discerned that these are extremely diverging positions and there is no meeting ground for the two sides. China is eagerly waiting for the demise of the Dalai Lama as evident from the statements of its officials in Tibet. It is aware of the political and religious weight and clout of the Dalai Lama inside and outside Tibet. It would be wishful thinking of China if it believes that the Tibetan movement will die with the demise of the Dalai Lama. The émigrés feel that the TGIE has matured as an institution and would continue be an umbrella organization for Tibetan émigré throughout the world, and continue to follow the course of non violence and engage China into a dialogue. The TYC, TWA, SFT and others are likely to continue the struggle through the tactics of the mass movement on the one hand, and arouse international support and sympathy for their cause on the other. Largely, the direction of their movement will be non-violent as indicated by various factions.

Everyone acknowledges that the void left by the Dalai Lama would be difficult to fill in. It would not only be a huge loss for Tibet and the émigrés but a loss for China too, for China will never find a personality like him, who could wield the support of all sections of Tibetan people. Therefore, China need to thrash a settlement when he is around, and if China fails to address this issue in time, it could become grave as we have seen how unattended conflicts with ethnic subtexts such as in Palestine, Yugoslavia and Kashmir can erupt in ways that make them virtually impossible to be resolved. It's in the interest of all stakeholders not to let that happen to Tibet.

China in Nepal: India and China need to work closely on the issues of security

Nirupama Rao, the Foreign Secretary of India during her Nepal visit between January 18 and 20 accessed the halted peace process and discussed bilateral and other issues of common concern with the caretaker Nepalese Prime Minister and other senior government officials including the leader of opposition Maoist Party, Prachanda. She also attempted to pull out the jittery relations from the quagmire, which nose dived in October 2010 in the aftermath of Unified Maoists' Party cadres hurling shoes at the Indian ambassador to Nepal. China is considered as the main weight behind the Maoists, and has been increasing its footprints in Nepal with a feverish pace that has made India increasingly apprehensive of its moves.

Historically, Tibet factor has determined the direction of Nepal-China relationship. Nepal’s expansion in Tibet in 1788 resulted in the 1791-92 war with China, by virtue of which Nepal was reduced to a vassal of China. The 1854-56 war with Tibet resulted in Tibet being forced to pay tribute to Nepal; Nepal also acquired extraterritorial and trading rights in Lhasa. However, Nepal’s southern expansion and subsequent Anglo-Nepalese War of 1814-1816 reduced Nepal into a British protectorate. During the mid 19^th century, after capturing power, the Ranas forged good ties with the British, and in the early 20^th Century, in recognition of the contribution of Nepal during the World War I, the “Treaty of perpetual peace and friendship,’ was signed in December, 1923 between the two. The treaty was replaced with the ‘India and Nepal Treaty of Peace and Friendship’ on July 31, 1950. Even though the treaty allows the free movement of people and goods between India and Nepal, it continued to interlock Nepalese economic and security interests with those of India owing to the China factor.

India-Nepal relations throughout the monarchy, except Tribhuvan’s time, have been full of discord and distrust. After Tribhuvan’s death in 1955, the relations further deteriorated and China seized the opportunity to develop ‘special relations’ with Nepal. China accused India of ‘expansionism’ and ‘hegemonism’ and signed peace and friendship treaty with Nepal in 1960, also concluded the border agreement, and commenced the construction of Kathmandu-Tibet highway a year later. China’s another interest in Nepal during this time was to flush out the Tibetan guerrillas who were operating from Mustang Area of Nepal. However, with the resumption of diplomatic ties between India and China during mid 1970s, China probably realised the futility of excessive courting and salvaging Nepal by ferrying goods over Himalayas in the wake of 1989 Indian sanctions on Nepal.

It was perhaps for its international image that China denounced Maoists insurgency in Nepal during the monarchy. However, when Maoists formed the government and Prachanda was sworn in as Prime Minister, the first country he visited was China during Olympics 2008. This was also the time when China’s assertiveness in the region and beyond had started to take shape. The sheer political capital of the Maoists, and the anti-China Tibetan protests in March 2008 in various parts of Tibet including Sichuan, once again underscored the importance of Nepal to China. In September 2008, China invited Nepalese Defence Minister Ram Bahadur Thapa as an observer to the military exercise ‘Warrior 2008’; during his meeting with Chinese Defence Minister Liang Guanglie, China announced a military aid package of USD 1.3 million to Nepal. In December 2008, Lieutenant General Ma Xiaotan of the PLA visited Nepal and pledged USD 2.6 million in non-lethal military aid to Nepal. Conversely, in 2007 when India sent non-lethal military assistance to Nepal, it created a furore with the Maoists lodging vigorous protests and accusing New Delhi of trying to sabotage the peace process. Even as Prachanda called for the revision of 1950 Treaty, Nepal accepted the draft of a ‘Peace and Friendship Treaty’ with China in April 2009. Nepal also showed its reluctance to sign the Extradition Treaty proposed by India in 2008, thus ignoring India’s concerns over terrorists having links in Nepal. Besides deepening politico-military ties, dozens of China Study Centres across Nepal has also made India apprehensive of Chinese motives. The reconstruction of the Nepal-China highway by China has also not gone well in our security establishments. General perception in China is that since India denies her a free access into the region, therefore, China sees the construction of these projects in India’s vicinity extremely important channels for trade and communication in South Asia. It is believed that China has invested millions of dollars in Nepal’s hydroelectricity projects.

It is obvious that there is a flurry of diplomatic as well as economic activities between China and Nepal. In 2009 alone, an unprecedented 38 Chinese delegations visited Nepal. With China’s increasing economic muscle, its political, economic and diplomatic assertiveness is also increasing. The general perception in India is that China’s engagement with Nepal and other countries surrounding us has been multi-dimensional and designed to diminish the Indian influence in South Asia. Why China has been able to change the perceptions of the people in the subcontinent favourable to China calls for introspection, and requires corrective and immediate measures, for India cannot afford to take our historical and cultural ties with Nepal and other countries for granted.

China is aware of the fact that it would be impossible to shift the cultural influence of India in Nepal to its favour. Therefore, New Delhi’s approach should be if Nepal wishes to renegotiate the 1950 treaty and delink our national security interests with it, so be it. If it wants close the present open border with India, we should be happy, as we have increasingly declared the border as a ‘hotbed of ISI intrigue.’ Meanwhile, India needs to proactively engage and integrate these nations into our economic development, show magnanimity in various disputes and increase our footprints in various domains. This is the policy India not only needs to initiate with its immediate neighbours but also within the fringes of our own borders.

Given China’s military and other quasi-military projects in Nepal, Sri Lanka, Bangladesh, Myanmar and Pakistan, it is amply clear that China has consistently followed the strategy of pinning India to the subcontinent, and has used our differences with our neighbours’ to their own advantage with a lethal statecraft. However, the question we must ask ourselves is that do we have the capabilities to undertake the projects the Chinese companies are taking in our vicinity, or is it because of the sloppiness of our government as well as private sector to avail such opportunities in our neighbourhood? As far as China’s infrastructural development projects in our neighbourhood are concerned, these may generate multiplier effects and pave way for trade and commerce for Indian companies as well. However, China also must be careful in inciting anti-India rhetoric in these countries, for this may prove the ‘string of pearls’ thesis of containing India true, and force India to move closer to the United States as well as other countries and regions that are antagonistic to China. Therefore, China needs to work closely with India in the shared neighbourhood on the issues of security, including the maritime security.

South Africa in the BRICs: Shifting global economic power away from the developed countries?

Recently Chinese President Hu Jintao formally invited South African President Jacob Zuma to attend the third BRIC leaders’ summit to be held in China in the first quarter of 2011, thus taking the number of BRIC nation to five (Brazil, Russia, India, China and South Africa). South Africa had applied and lobbied to join the BRIC at the G20 meeting of the world's leading economies in Seoul in November this year. The acronym, BRIC was coined by Jim O’Neill an economist with the Goldman Sachs in a paper entitled "The World Needs Better Economic BRICs" published in 2001. The notion signals a shift in the global economic power away from the G7 economies toward the emerging economies. The BRIC thesis holds that China and India will become the hub of world’s manufactured goods and services, while Brazil and Russia will become leading suppliers of raw materials.

At present, the BRIC account for more than 25% the world’s land mass; more than 40% of world population; over 50% of world economic growth; and around 15% of the world economy. The economic indicators are bound to further shift the balance in favor of emerging economies given the astounding growth rate of over 9% in India and China. Now, with South Africa, the world’s 31st-largest economy joining the ranks, the BRIC will wield even more influence in the world economy. Even though, South Africa’s 286 billion $ economy and population of 49 million pales if compared to other BRIC members, especially China and India, however, it is the most advanced economy in Africa; the largest trade partner of China in Africa; and more importantly will provide a gateway to the BRICS into Africa.

South Africa’s entry has definitely given the BRIC a voice in African Continent, and is bound to strengthen the economic base of a multi-polar world on the one hand, and create conditions for the strengthening of global peace and security on the other. The BRIC nations call for the reforms of the world organizations, including the financial institutions and the United Nations, and demand greater role for the emerging economies in these bodies. This is obvious from the BRIC foreign ministerial meeting on May 16, 2008 in Yekaterinburg prior to the first BRIC summit at the same place in 2009. During the meeting, the BRIC nations called for the emerging economies to play more assertive role in the World Bank and the International Monetary Fund. A week prior to the Yekaterinburg summit, Brazil and Russia offered $10 billion each to the IMF and China announced plans to invest a total of $50.1 billion. India on its part has committed to contribute $ 3 billion. This was also approved by the G20 summit held in South Korea in November 2010. The reforms of the world financial institutions are considered as an important step towards a more legitimate, credible and effective bodies that will ensure greater quotas and representation reflecting the new global economic realities.

There are various agreements and frameworks concluded among the BRIC countries such as the Shanghai Cooperation Organization (SCO), where India is included in the capacity of an associate member and could become a full member in future as Russia has supported its candidature; the IBSA, which unites Brazil, India, and South Africa in annual dialogues; and more importantly, all BRIC nations including the new entrant are the members of G20. South Africa, India and Brazil will also take up a two-year seat on the United Nations’ Security Council from next year, resulting in all BRIC nations being represented on the council.

Impressive growth trajectory of the BRIC nations, and the currency appreciation especially in India and China has provided a huge opportunity for the investors in BRIC assets; meanwhile, the BRIC countries are also contemplating to buy each other’s bonds and swap currencies so as to reduce the dependence on dollar; and why not when the combined reserves of these countries are around $ 3 trillion and are the biggest holders of the US treasuries.

Regardless of the potentials and opportunities, and the reach through every continent, the BRIC countries will face enormous challenges as they do not have a common agenda. Added to this, they are not an economic block like the European Union or a political alliance like the NATO, albeit capable of converting their economic prowess into a greater geopolitical clout; all have diverging interests, and at times conflicting.

First of all, the mammoth economic growth of the BRIC counties is dependent on the manufacturing based on raw materials such as iron ore, copper, aluminum, fossil fuel and natural gas; technological breakthrough in renewable energy could shift the balance again in favor of G 7, and could result in slower economic growth than anticipated. Secondly, the so-called currency manipulation by some BRIC countries has ‘harmed’ the manufacturing in some countries, as admitted by the Brazilian finance minister Guido Mantega recently. Thirdly, there is an asymmetric relationship between the polities and economies of the BRIC nations. For example, the economy of China is bigger than the rest 4 and holds over $2.45 trillion of reserves, over 30% of the world reserves; its political clout is also bigger, as it holds the veto power in the UNSC besides being talked as G2 partner with the US. Fourthly, the political equations between India, China and Russia are impregnated with ‘mutual mistrust’ and huge ‘security deficit’, especially between India and China on the issue of border, and China’s entente with its ‘all weather friend’ Pakistan. Fourthly, some other regional flashpoints weather in the South China Sea or in the subcontinent could make the cooperation between major BRIC countries irrelevant. And, finally the domestic issues, especially the increasing social imbalance in the BRIC nations could also pose serious challenges to the internal security and economic development in these countries.

Nevertheless, the South African entry into the folds of BRIC is a welcome move, and could open this ‘alliance’ to other emerging economies. Some of the aspirants in Asia could be Vietnam, and China may be keen to put Saudi Arabia on board. We can hope that the BRIC becomes an example for all emerging economies, promote economic cooperation, ease tensions by settling bilateral disputes, and guarantee prosperity, peace and security not only in the region but also in the world at large.