Rapprochement in disguise | India mends fences with China. Will Pakistan be next?

Global conflicts force India’s hand, intertwining economic pragmatism with geopolitical recalibration

If China comes, can its ‘iron friend’ Pakistan be far behind, is a contemporary, current affairs variation of English romantic poet Percy Bysshe Shelley’s Ode to the West Wind.

The March 10 Union Cabinet decision to permit Chinese investments — even though a minimal 10% — in Indian companies without prior government approval amounts to making virtue of a necessity to confront economic headwinds triggered by the United States-Israel war against Iran. The new rule went into effect on May 1. A potentially more productive effort to attract foreign direct investment (FDI) from China through a 60-day expedited approval process for investments in ‘priority manufacturing’ sectors, is a belated recognition that China is the only country that can compensate for the steady flight of foreign capital from Indian shores in the last two years.

India lost six years by restricting investments from China via what came to be known as the ‘Press Note 3 (PN3) framework’. The framework curbed investments by seven countries which share land borders with India, but the real target was China, and the ostensible reason was to prevent ‘opportunistic takeovers/acquisitions’ of Indian companies. The true reason was a military clash in Galwan Valley in Ladakh in 2020, in which lives were lost on both sides.

Since FY2023-2024, economists and politicians in India’s economic ministries have been at loggerheads over tapping China for India’s continued growth. That year’s annual Economic Survey reasoned that Chinese FDI was essential for India’s manufacturing and export growth. But the political leadership of the Commerce Ministry was quick to rubbish the suggestion. This year’s rule changes are a small win for sound economic reasoning.

Why is Pakistan not far behind in this process of rapprochement, which is dressed up for consumption by the Indian public as everything but a rapprochement? Expanded back-channel talks have begun between India and Pakistan after a hiatus of eight years in bilateral communication. The last concrete proposal for bilateral official meetings between the two South Asian neighbours was through a flurry of letters exchanged at ministerial levels in September 2018. These were to lead to a meeting of the two Foreign Ministers later that month in New York on the sidelines of the United Nations General Assembly. However, while the two Foreign Ministers were preparing for that meeting, there were separate fatal terrorist attacks on Jammu and Kashmir police personnel and a Border Security Force soldier. India called off the New York meeting, and high-level talks have been frozen ever since.

As this column has noted before, ‘no talks’ cannot be a long-term policy between two neighbouring countries when the possibility of conflict perennially looms over them and both adversaries are nuclear-armed. The world which India and Pakistan are navigating has changed beyond recognition in the eight years since they stopped talking to each other. Pakistan has been agile in adapting to these changes in the international environment. India describes such nimble-footedness in Islamabad as being a dalal (middleman or broker). But in recent years Pakistan’s policies have catapulted that country from an outcast in the international community and placed it on the world’s centre stage on multiple occasions. Consider, for example, how this pariah state not long ago managed to get 182 votes in the 193-member UNGA and is now serving its second year as a non-permanent member of the UN Security Council.

It is futile to compare Pakistani diplomacy with that of India, as some do. That would be tantamount to analytical hyphenation. India has notched up creditable foreign policy successes in the new millennium. But the country tends to rest on its laurels once it has achieved something. Complacency has set in because India has grown in the last two decades into a global power from its earlier place as a South Asian power and then as a force in Asia.

Clearly, there is unease in the strategic community that while the government in New Delhi is behaving like the proverbial ostrich by burying its head in the sand over Pakistan issues, India is being shortchanged as a consequence. Pakistan has enjoyed an iron-clad relationship with China for at least six decades. To this, now Field Marshal Asim Munir has added the support of the White House ending a fairly extended period of neglect by successive administrations in Washington. The former Chief of Army Staff, General M M Naravane, said on May 13 that “people-to-people contact is important” between India and Pakistan. The most influential voice in the rising rumble for a new approach to Pakistan and for resumption of bilateral dialogue is that of RSS Sarkaryavah (general secretary) Dattatreya Hosabale. If the RSS comes, can the BJP-led government be far behind?

K P Nayar has extensively covered West Asia and reported from Washington as a foreign correspondent for 15 years.

(Disclaimer: The views expressed above are the author's own. They do not necessarily reflect the views of DH.)