India must remain wary of China’s aims of upgrading narrative power and security mechanisms in Asia
The Communist Party of China (CPC) elite met from 15-18 July for its annual plenary session. This iteration known as the third plenum has been historically used by the CPC to signal the direction of important economic-policy initiatives. It was in the third plenum of the 11th Central Committee in 1978 that Deng Xiaoping steered China out of its Maoist isolationism, inviting foreign businesses to operate and gradually paving the way to making it the second-largest economy.
Parsing through the CPC’s documents gives us an idea of the tasks it plans to complete in the next five years. First, Xi Jinping, as the chief of the CCP, assesses that there have been significant changes of great magnitude in recent times. He states that the international situation is becoming uncertain and unpredictable, warning about “black swan” events having the potential to threaten the Party’s hold on power. For example, the Party-state response was found to be lacking when the COVID-19 pandemic broke out in Wuhan. The CPC has now resolved to strengthen the mechanism to handle such major public emergencies. As Xi ordered urban centres to shut down for protracted periods to combat the pandemic, China’s youth hit the streets, protesting against the Party-state’s grip. Now to ensure that the Party is not caught unawares, it plans to work on a unified national population management system.
Xi points to the frequency of regional conflicts, warning that international issues are becoming more acute. China has been at loggerheads with its neighbours over territorial disputes, and it intends to strengthen institutions in charge of managing the defence of the border and coastal areas. It also seeks to improve mechanisms that enable the Party-state, the People’s Liberation Army (PLA), the law-enforcement agencies, and the civil society to work together on border governance. This assumes significance for India, given that the PLA and Indian Army have been involved in a standoff for the last four years, and since China has constructed villages along the Line of Actual Control (LAC). It also seeks to finetune the system for national defence mobilisation, modernise the weaponry management system, and enhance military-civilian alignment.
China has been at loggerheads with its neighbours over territorial disputes, and it intends to strengthen institutions in charge of managing the defence of the border and coastal areas.
In the last few years, under Xi’s Belt and Road Initiative (BRI), Chinese corporations have set up businesses in foreign nations. Concomitantly, after the Russia-Ukraine war started, China announced the Global Security Initiative (GSI) in April 2022, referencing the “indivisible security” concept, meaning that one nation’s security could not come at the expense of another’s; Xi pointed to efforts by the West to build cliques to provoke conflict along ideological lines. Under GSI, China seeks to train security personnel from developing countries over the next five years and promote exchanges among defence and law-enforcement training academies. This has been mentioned in the plenum resolution that seeks greater protection against risks posed to China’s interests and investments overseas and seeks to establish coordination mechanisms for promoting security in China’s neighbourhood.
The CPC elite has taken cognisance that there are negative perceptions regarding China. For instance, the survey by Pew Research Center found that the proportion of people in the United States (US) who describe China as an “enemy” is increasing, and seek to curb its power as an important priority. The survey adds that China’s negative image is also due to its deteriorating relationships with a few neighbouring countries and deep distrust of Xi. Thus China’s elite has resolved to improve China’s narrative power by restructuring the framework for China’s global communication and improving the efficiency of China’s media outlets to create a positive spin.
The plenum resolution also signals China’s economic priorities. While Xi gauges that China’s industrial system is not yet advanced enough, and flags that attempts by a West-led alliance to contain China are increasing. He warns of China’s over-dependence on core technologies controlled by rivals. The plenum overarchingly aims to further Chinese-style modernisation to upgrade industrial capacity. Efforts will be on to build resilience through strong industrial chains for integrated circuits, industrial machine tools, medical equipment, and basic and industrial software. China seeks further reform of its state-owned enterprises to enhance their competitiveness and invest more in sectors that have national security implications. The expectation for the private sector is that it will put its efforts into fructifying the Party-state’s priorities with respect to making more technological breakthroughs.
The plenum resolution also signals China’s economic priorities. While Xi gauges that China’s industrial system is not yet advanced enough, and flags that attempts by a West-led alliance to contain China are increasing.
An export-driven strategy through which China became a production and assembly line for goods propelled it to becoming the world’s second-largest economy. China will now strive to improve conditions for Xi’s latest conceptualisation of “new productive forces”, which are defined as new industrial sectors and new business models through improved allocation of production factors: land, labour, capital, and technology. Plans are afoot to create funding avenues for “strategic” industries in aerospace and aviation, new energy, biomedicine, quantum technology, advanced information technology and Artificial Intelligence (AI). While China works to bolster these new productive forces, it will also ensure capital allocation for old brick-and-mortar industries to retain the proportion of the manufacturing sector in the overall economy.
China’s reinvigorated industrial policy will have a long gestation period for which it has mooted the idea of “patient capital”. The provision of capital will be done through updated regulations on the development of angel investment, venture capital, and private equity investment, better leveraging the role of government investment funds, especially for important national science and technology programmes.
There are demographic worries for China after its population started declining from 2022 onwards. China seeks to tide over the problem by investing more in human capital formation to upskill its population. The plenum resolution envisages reform of educational institutions to incubate talent and build educational capacity in basic and emerging disciplines that can boost China’s capacity for innovation. It also hopes to put in place a vocational training system better suited to industry needs. While the Chinese domestic narrative rails at the US for containing the nation’s rise through a technology blockade, efforts will be on to attract foreign universities with high rankings in science and technology to partner with educational institutions in China. Internally, China’s private tech majors will be encouraged to collaborate with campuses and research institutions.
There are demographic worries for China after its population started declining from 2022 onwards. China seeks to tide over the problem by investing more in human capital formation to upskill its population.
To conclude, the message from the third plenum is clear: Xi envisages a strong role for the Party in the economy and aims to initiate an industry-centred economy policy. As industrial policy comes to the fore, there are concerns voiced by the Indian government about China creating an overcapacity that can drive down prices, hurting Indian businesses, especially in those segments where China dominates.
Second, the plenum aims to improve its narrative power by remaking the mechanism for China’s global communication
This must also be seen in conjunction with the recent development of the PLA instituting the Information Support Force, and the concept of ‘internet information system’ being crucial to winning modern battles. Thus, India must be wary of China’s disinformation campaigns. Lastly, China seeks to connect economic and security cooperation, and craft alternative frameworks to expand its influence through the domains of law-enforcement capacity building and defence. In this regard, the objective of setting up a mechanism for promoting security in China’s neighbouring regions has direct security implications for India, since it may mean aligning with entities opposed to the latter.
Kalpit A Mankikar is a Fellow with the Strategic Studies Programme at the Observer Research Foundation
The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.
Kalpit A Mankikar is a Fellow with Strategic Studies programme and is based out of ORFs Delhi centre. His research focusses on China specifically looking ...
Read More +
PREV
