How China-Taiwan Tensions Play Out in India
South Asia has closer ties with Beijing, but the risk of escalation presents a challenge, especially for New Delhi.
Welcome to Foreign Policy’s South Asia Brief.
Welcome to Foreign Policy’s South Asia Brief.
The highlights this week: Tensions in the Taiwan Strait have ripple effects in South Asia, a Pakistani terrorist leader is killed in Afghanistan, and fuel price increases fuel protests in Bangladesh.
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India’s Latest Balancing Act: Taiwan Strait Tensions
Rising tensions in the Taiwan Strait have unnerved governments around the world, including in South Asia. Beijing has expanded its influence in the region in recent years, even as Taipei has sought to expand its own commercial connections. The stakes are especially high for India because of its rivalry with China, its quiet efforts to deepen engagement with Taiwan, and its role in U.S. Indo-Pacific policy.
China has a deep economic footprint in South Asia after years of heavy investment; even India has taken in nearly $17 billion in Chinese investment since 2005. Between 2005 and 2020, China’s exports to South Asia increased fivefold. By contrast, the region’s economic ties with Taiwan are modest. Taiwan’s total annual trade with the region is estimated at $9 billion. (For comparison, Taiwan’s exports alone to Southeast Asia totaled more than $70 billion in 2021.)
Taiwan has sought to strengthen engagement with South Asia through its New Southbound Policy, which prioritizes 18 countries for stepped-up commercial collaboration. One of the policy’s most tangible achievements so far is making more visas available to South Asians. Still, South Asian states are likely more concerned about conflict in the Taiwan Strait because it would disrupt trade with China, not because it would interrupt efforts at friendship between Taiwan and the region.
However, India has expanded economic cooperation with Taiwan more than any of its neighbors, in great part because of its sharp rivalry with China. Trade with India accounts for nearly 80 percent of Taiwan’s trade with South Asia. In recent decades, New Delhi and Taipei have inked a bilateral investment agreement and pursued science and technology cooperation.
Despite India’s vows to curtail commercial cooperation with China, it remains a top trade partner. New Delhi has also never opposed Beijing’s “One China” principle—its view that it has sovereignty over the mainland, Hong Kong, Macao, and Taiwan. Furthermore, its guiding foreign-policy principle—strategic autonomy—forbids it from taking formal positions on other countries’ disputes. If China were to invade Taiwan, India would likely take a muted position—one comparable to its stand on Russia’s war in Ukraine.
India already carefully manages its diplomatic relations with a few rivals—the United States and Russia, Iran and Saudi Arabia, to name a couple—and escalating tensions between China and Taiwan present another case. So far, India has succeeded at this balancing act by staying quiet. Sana Hashmi, an expert on India-Taiwan relations based in Taipei, told me this week that if New Delhi made any public statement, it would mostly likely cover the “bare minimum,” and probably not mention China or Taiwan by name. If it did, this would “mean a policy change,” she said.
Yet the broader geopolitics matter for India. China-Taiwan tensions are playing out in the Indo-Pacific region, where India strongly supports U.S. policy that revolves around countering China. Even major Chinese military provocations falling short of an invasion would be a major blow to the policy, which aims to keep the region peaceful. Current tensions are “destabilizing the Indo Pacific, and that does impact India’s security interests and its objectives in the Indo-Pacific,” Hashmi said.
Seeking to avoid getting pulled into U.S.-China competition, other South Asian states have distanced themselves from the Indo-Pacific policy—even though many of them have received investments as part of Beijing’s Belt and Road Initiative. Bangladesh declined a U.S. invitation to become a partner in the policy, while Nepal long resisted agreeing to an infrastructure grant that U.S. officials had described as part of the policy.
The destabilizing effects of tensions in the Taiwan Strait could still present a problem for South Asia more broadly—by threatening some of its partners. Last week, China flew drones near Japan in a show of force. Japan is one of the region’s biggest bilateral donors, and Bangladesh is the largest recipient of Japanese development aid. South Korea, which has substantive trade ties with some South Asian states, would also be vulnerable during a conflict in the Taiwan Strait.
South Asian states may have less skin in the game than other countries in the Indo-Pacific or the United States, but its interests are also best served by de-escalation in the Taiwan Strait.
Lynne O’Donnell, who was detained by the Taliban in July, together with Michael Kugelman, joined FP’s editor in chief Ravi Agrawal Thursday on FP Live to discuss the future of Afghanistan, days before the anniversary of the Taliban takeover of the country. Watch the interview on demand.
What We’re Following
Top Pakistani terrorist killed in Afghanistan. Omar Khalid Khorasani, a top commander of the Tehrik-i-Taliban Pakistan (TTP), was killed by a roadside bomb in Afghanistan last Sunday. Khorasani’s name may not be as recognizable as that of Ayman al-Zawahiri, the al Qaeda chief killed in a U.S. drone strike in Kabul a week earlier, but he was a major figure in the TTP and within the region’s broader militant network.
Khorasani rose to the upper ranks of the TTP, also known as the Pakistani Taliban, and became infamous for his unrepentant brutality and for mocking his targets on social media—especially journalists. He made boasts that are difficult to verify, from incorporating female suicide bombers into the TTP’s tactics to sheltering Zawahiri. In recent months, TTP attacks in Pakistan have surged, and many have targeted Pakistani security officials.
Khorasani died with three other TTP leaders, but the circumstances of the killing are unclear beyond the blast. In the days before, negotiations between Islamabad and the TTP had reached an impasse. Khorasani, who was involved but had long rejected talks with Pakistan’s government, may have been targeted by TTP members who opposed his maximalist positions. Pakistani involvement can’t be ruled out, either; the government would have a strong interest in removing a figure seen as an impediment to the negotiations.
Fuel protests flare in Bangladesh. Demonstrations broke out in Bangladesh this week after the government raised fuel prices by 50 percent over the weekend. The measure aims to address growing inflation and falling foreign reserves that have plagued the country since Russia invaded Ukraine. What stands out about Bangladesh’s crisis is that is has been one of the world’s best-performing economies in recent years; this week shows that even strong economies are struggling to withstand external shocks.
Bangladesh’s economic stress is nowhere near as serious as Pakistan’s, much less Sri Lanka’s. Inflation has hit 7 percent, and the country has sufficient foreign reserves for about five months. In Pakistan, inflation has surged to nearly 25 percent, and Sri Lanka’s has approached an astounding 60 percent. All this said, Dhaka’s decision to raise fuel prices and the ensuing protests offer an opportunity for the country’s beleaguered political opposition.
The Bangladesh Nationalist Party, the country’s main opposition group, has announced two days of protests on Thursday and Friday.
India and Pakistan soar at Commonwealth Games. Indians and Pakistanis are celebrating after the Commonwealth Games, which are held every four years and concluded on Monday. This year’s games were hosted by the United Kingdom and involved more than 70 countries. India topped the medal tally in four sports: badminton, table tennis, weightlifting, and wrestling. It also won its first-ever gold medal in the triple jump event, along with its first medal in steeplechase.
Pakistan also enjoyed several firsts. Javelin thrower Arshad Nadeem won a gold medal with a toss that traveled nearly 300 feet—a new Commonwealth Games record. Nadeem’s teammate, weightlifter Nooh Dastgir Butt, set another record by lifting nearly 900 pounds, which earned Pakistan its second gold. Pakistan had not won a gold medal at the games since 1962.
Bangladesh was not as fortunate: Its 30 athletes failed to earn a single medal.
Under the Radar
India and China have quietly competed in Sri Lanka for the last decade, trying to outdo each other with offers of infrastructure investments, development assistance, vaccines, and fertilizer shipments. This competition has rarely played out publicly—until this week, with an incident that hinted at the military dimensions of India-China rivalry in South Asia.
In July, Sri Lanka agreed to China’s request to have a naval vessel dock at Hambantota Port, a controversial Chinese infrastructure project that Colombo has leased to Beijing for 99 years. China wanted to bring the ship to the port for servicing. According to China military analysts, the vessel is used to monitor missile launches.
The ship was scheduled to dock at the port this week, but instead the Sri Lankan government said it had asked Beijing to defer its arrival. India, which fears China will turn Hambantota into a naval base, had expressed its concern about the plan last month. This represents a rare rebuke to China’s use of its military in the Indian Ocean region, where it has recently scaled up its naval presence.
China established its first foreign naval base near Djibouti in 2017, and in 2019 India discovered a Chinese research vessel near the Andaman Islands, an Indian union territory. Sri Lanka’s decision to push back against China is a boost for India, which worries about China’s military presence in its broader backyard.
FP Insider: Climate Finance and Geostrategic Interests in the Pacific
The Pacific islands—comprising 14 countries and seven territories—are an underdiscussed, yet increasingly important, strategic theater when it comes to great-power politics as well as transnational challenges such as climate change.
As U.S.-China relations steadily deteriorate under mounting economic, military, and technological competition, the Pacific islands are caught between global superpowers vying for regional influence, while trying to advance their economies and withstand the accelerating impacts of climate change.
This FP Insider Brief explores Chinese and U.S. strategic and security interests in the Pacific region, the potential economic and security impacts of climate change on the Pacific islands, and the role of climate development finance in Pacific island countries’ economies.
A Dawn editorial lambasts a social media campaign that followed the death of six Pakistani soldiers in a helicopter crash during a humanitarian mission in Baluchistan; the campaign alleged that Pakistan’s military had orchestrated the tragedy to gain sympathy. “Brave men who have given the ultimate sacrifice in the service of humanity are not fodder for lynch mobs in cyberspace to use as material for politically motivated propaganda,” it argues.
In Kuensel, lawyer Sonam Tshering applauds Bhutan’s decision to begin drug testing in schools as a strong prevention method, but she warns of the risks of criminalization, noting that Bhutan’s laws emphasize treatment over incarceration: “Drug tests in schools should not be used as a means to incarcerate or punish students and teachers … merely using or being addicted is not a criminal offense,” she writes.
Analysts Rudabeh Shahid and Sirazoom Munira lay out a climate change mitigation strategy for Bangladesh in 9DashLine. They call for a combination of domestic interventions and international engagement. “It is worthwhile considering where Dhaka sits on the broad spectrum of climate geopolitics,” they write.
Michael Kugelman is the writer of Foreign Policy’s weekly South Asia Brief. He is the director of the South Asia Institute at the Wilson Center in Washington. Twitter: @michaelkugelman
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