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1. What Should India Do Before the Next Taiwan Strait Crisis?

Author:
Vijay Gokhale
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
In the next two decades, the Taiwan question is likely to assume increasing importance for the Indo-Pacific region. The People’s Republic of China (PRC) is becoming more assertive about unifying Taiwan with the mainland, and it is also making progress toward establishing the military capability toward this end. For a rising PRC seeking to establish itself as the dominant global power, it is untenable that a part of its territory remains outside its control. Possible endeavors toward establishing this control could lead to a response by the United States, which would have broader ramifications for the region and the world. For the United States, any endeavors by the PRC to this end would undermine the very core of the idea that the United States is the defender of freedom and democracy across the world, thus undermining its credibility. It might also deal a devastating blow to the United States’ global power. In this context, and given the significance of Taiwan to both countries, it is an issue that can rapidly escalate, making it a matter of concern in the Indo-Pacific. Further, a conflict over Taiwan would dwarf the global economic fallout that began when Russia invaded Ukraine in 2022. Short of conflict, Chinese coercion of Taiwan could disrupt the freedom of navigation and sea lanes of communication through the Taiwan Strait and will have severe consequences for Asian geopolitics and geoeconomics. Given India’s substantial geopolitical and geoeconomic interests in the region and its long history of exchanges with East and Southeast Asia, India should pay constant and careful attention to this issue. Further, a policy to respond to various contingencies must be thought through and put into place. This paper tries to look at the possible policy that India might adopt ahead of a major crisis in the Taiwan Strait. The paper proceeds in three parts. The first part analyzes the geopolitical and geoeconomic consequences of another Taiwan Strait crisis for India. While it is difficult to estimate the actual damage that would be dealt to the Indian economy, it is clear that all segments of the economy would be affected, with the impact possibly substantial enough to set India back several years. A crisis would also impact India’s geopolitical interests and national security, given that China is increasing its assertiveness both along the Line of Actual Control as well as in the Indian Ocean. The second part argues against a commonplace view that India played no role in crisis management during earlier periods of high tension in the Taiwan Strait—the 1954–55 and 1958 Taiwan Strait Crises, also known as the First and Second Taiwan Strait Crisis, respectively. By using archival material in the United States, the United Kingdom, and India, it seeks to dispel the above notion and that Taiwan ceased to be a matter of interest for India after it had recognized PRC’s claim over Taiwan in 1950. Further, it looks at the lessons for policymaking from India’s handling of the crises. The third part of the paper briefly traces the history of India-Taiwan relations following India’s transfer of its diplomatic recognition to the PRC till the present day. It provides an overview of India’s Taiwan policy. Given that a war in the Taiwan Strait is not beyond reasonable doubt, it then discusses the scenarios India might find itself in and the possible policies to respond to these scenarios. It recommends a close following of the U.S.-ChinaTaiwan strategic triangle, a whole-of-government assessment around impacts of a Taiwan Strait contingency, and an assessment of policy options. It also recommends mapping the expectations that China and the United States would have of India, along with undertaking consultations with key partners on the Taiwan question.
Topic:
Foreign Policy, Geopolitics, Crisis Management, and Geoeconomics
Political Geography:
South Asia, India, Taiwan, Asia, and Indo-Pacific

2. Lessons from the Coronavirus Pandemic: Leveraging Biotechnology to Tackle Infectious Diseases in India

Author:
Shruti Sharma
Publication Date:
06-2022
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
In India, the coronavirus pandemic encouraged partnerships between academia and industry, fostered collaboration among competitor companies, and stimulated cooperation within different government departments to leverage biotechnology to develop new test kits, protective equipment, vaccines, and respiratory devices. Despite this collaborative ecosystem, a few stakeholders faced several challenges during different stages of product development including discovery, research and development (R&D), clinical trial, or commercialization of their products. Some of these challenges can be attributed to a lack of an ecosystem that encourages collaborative research in India, limited involvement of private funding entities, a gap between academia and industry where university researchers lack sufficient awareness of the imperatives of industry, and a lack of awareness regarding contemporary applications of biotechnology among the regulatory community. The goal of this paper is to provide all stakeholders and the Indian public an overview of the role that advancements in biotechnology can play in strengthening India’s public health capacity. While the pandemic offered significant opportunities to the scientific community and private players in India to develop medical countermeasures, this paper only illustrates examples that discuss strategies that were adopted to accelerate the development of diagnostics and vaccines in the country. It further elucidates the challenges, both regulatory and funding, that some stakeholders faced in introducing new diagnostics and vaccines into the market during the pandemic. The paper argues that it is important for India to adopt a systematic approach to sustain the collaborative ecosystem that was cultivated during the pandemic. It further provides a brief assessment of the policies that regulate vaccines and diagnostic kits in India and the scope of enhanced and better implementation in the future. The paper also suggests strategies to maintain a continuous flow of investment to sustain research, streamline the regulatory infrastructure to minimize ambiguities regarding product approvals, and foster multistakeholder collaboration to create a sustainable research and innovation ecosystem that can be leveraged during health emergencies in the future.
Topic:
Infectious Diseases, Public Health, COVID-19, and Biotechnology
Political Geography:
South Asia and India

3. Russia and India: A New Chapter

Author:
Rajan Menon and Eugene Rumer
Publication Date:
09-2022
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Russian-Indian relations are undergoing a major change. Throughout the Cold War, the relationship rested on three pillars: Soviet arms sales to India; shared public-sector-heavy economic philosophy and extensive Soviet aid; and the Soviet Union–India vs. United States–Pakistan–China geopolitical alignment. The fall of the Soviet Union, the rise of India and China, the U.S.-China tensions, the deepening of U.S.-India ties, and the Russian-Chinese partnership intensified by Russia’s break with the West and the war against Ukraine have had a profound effect on Russian-Indian relations. Of the three pillars of the Moscow–New Delhi relationship, only one remains: the arms trade. Russia remains a major supplier of weapons to India, and Russian equipment still makes up a vast portion of Indian Armed Forces’ force structure; but Russia is facing competition in the Indian arms market. India’s desire to diversify its supply of weapons and develop its own defense industry has resulted in declining Russian arms deliveries to India in recent years. Russia’s break with the West because of its war against Ukraine has accelerated its pivot toward China. Against the backdrop of U.S.-China and China-India tensions, Russia’s position as China’s junior partner will make it harder for Russia to preserve partnership with India. Moscow’s leverage versus both New Delhi and Beijing is shrinking as they have greater capabilities of their own than they had previously and have new partners that offer more than Russia. Still, the Russian-Indian partnership will continue. For India, Russia remains an important supplier of weapons and, most recently, oil. India has not joined the West’s sanctions on Russia. By doing so, it has demonstrated its independent foreign policy. For Russia, India is an important market for arms and oil. The Indian-U.S. security relationship is relatively new, whereas India-Russia ties have endured for over two generations. India has no reason to forsake the benefits of this relationship. Nor does Russia. It has been said that Moscow plays a weak hand well, but sustaining strong security ties with both China and India will become more difficult for it. The question is how China will react to Russian arms sales to India, and what Russia will do if pressed by China to curtail them. For reasons of geographic proximity, economic ties, and personal relations between Presidents Vladimir Putin and Xi Jinping, the odds favor Beijing over New Delhi to have a bigger say in Moscow.
Topic:
Foreign Policy, Cold War, History, Bilateral Relations, Partnerships, Geopolitics, and Russia-Ukraine War
Political Geography:
Russia, South Asia, Eurasia, Ukraine, India, and United States of America

4. How Do Indian Americans View India? Results From the 2020 Indian American Attitudes Survey

Author:
Sumitra Badrinathan, Devesh Kapur, and Milan Vaishnav
Publication Date:
02-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Indian Americans are now the second-largest immigrant group in the United States. Their growing political influence and the role the diaspora plays in Indian foreign policy therefore raises important questions—about how Indian Americans view India, the political changes underway there, and the course of U.S.-India relations. Since coming to power in 2014, Indian Prime Minister Narendra Modi has made outreach to the far-flung Indian diaspora a signature element of his government’s foreign policy. Modi’s courtship of the diaspora has been especially notable in the United States, where the Indian American population has swelled to more than 4 million and has become the second-largest immigrant group in the United States.1 In two separate, large rallies on U.S. soil—in 2014 and 2019—Modi sought to highlight the achievements of the diaspora, outlining the many ways in which they can support India’s interests from afar while underscoring their increasingly substantial economic, political, and social influence in the United States. These high-octane gatherings, however, naturally lead to a series of questions: How do Indians in America regard India, and how do they remain connected to developments there? What are their attitudes toward Indian politics and changes underway in their ancestral homeland? And what role, if any, do they envision for the United States in engaging with India?
Topic:
Foreign Policy, Bilateral Relations, Immigration, Public Opinion, and Survey
Political Geography:
South Asia, India, North America, and United States of America

5. The Road from Galwan: The Future of India-China Relations

Author:
Vijay Gokhale
Publication Date:
03-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
China and India struggle to comprehend each other’s international ambitions. The misperceptions that follow lead to a lack of trust, border skirmishes, and potentially worse. On June 15, 2020, Indian and Chinese troops engaged in a brawl that left twenty Indian soldiers dead while causing an unspecified number of Chinese casualties. The clash is a part of a broader border standoff along the Galwan River between the two forces on the Line of Actual Control that is yet to be resolved. The Indian strategic community is broadly in agreement that this border dispute marks an implacable decline in India-China ties. They argue that the very basis of relations that emerged after former Indian prime minister Rajiv Gandhi’s visit to Beijing in 1988 has been shaken, if not destroyed. Yet, how did the two countries manage to reach this nadir in ties, and furthermore, what does the Galwan clash signify for the future of Sino-Indian relations? This paper argues that, long before the present border dispute occurred, Sino-Indian relations had been steadily declining due to rampant misperceptions of the other side, contributing to a lack of trust. The most fundamental misperception between the two countries is the inability to comprehend each other’s international ambitions, yielding the fear that their foreign policies are targeted against the other. This paper traces the impact and development of these misperceptions on Sino-Indian ties through three different phases before considering the future of the relationship after the Galwan dispute.
Topic:
Foreign Policy, Bilateral Relations, Territorial Disputes, and Borders
Political Geography:
China, South Asia, India, and Asia

6. India’s Sustained Economic Recovery Will Require Changes to Its Bankruptcy Law

Author:
Anirudh Burman
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
As India’s economy recovers from the coronavirus pandemic, Indian businesses need efficient financial structures to regain their ground. Key reforms to India’s Insolvency and Bankruptcy Code could fill these gaps. One of the key drivers of economic recovery in India will be the efficient movement of capital from inefficient firms to efficient ones. The economic downturn caused by the coronavirus pandemic has been severe, and India’s economy was one of the worst affected in 2020–2021. Though the economy is recovering faster than initial estimates, sustained economic recovery will not take place if stressed businesses cannot restructure their debts properly or if failing firms cannot be resolved efficiently. India’s bankruptcy law is key to solving these challenges. In 2016 India enacted the Insolvency and Bankruptcy Code, 2016 (IBC), which was a landmark reform to the nation’s financial system and the first comprehensive law to regulate insolvency.1 But the IBC has been suspended for a period of one year since the COVID-19-related lockdown was imposed in March 2020. In its place, India’s banking regulator, the Reserve Bank of India (RBI), has introduced a limited restructuring scheme for COVID-19-related stress in the meantime. Older mechanisms for insolvency that are still in operation have historically not worked according to expectations. As the one-year period of suspension comes to a close, this paper argues that bringing back the IBC—with adequate modifications—is an important prerequisite for sustained economic growth. India historically suffered from a patchwork framework of insolvency laws that either did not give lenders adequate powers to recover their debts upon default or only catered to the interests of certain kinds of lenders—to the exclusion of others.2 The IBC is a modern and comprehensive bankruptcy law that since its enactment has had a significant role in reducing the problem of nonperforming assets (NPAs), or “bad loans,” in India’s financial system. In the wake of the economic disruption caused by COVID-19, the Indian government suspended the operation of critical parts of the IBC. These changes meant that lenders could not trigger insolvency proceedings against defaulting businesses if the default occurred after March 20, 2020. While this suspension possibly prevented unnecessary business failures and provided a “calm period” for the economy, these measures have outlived their utility.
Topic:
Law, Finance, Economy, and COVID-19
Political Geography:
South Asia and India

7. Measuring Trade Facilitation: Evidence from India

Author:
Vijay Singh Chauhan and Sruti Vijayakumar
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
The World Trade Organization’s Trade Facilitation Agreement has placed trade facilitation initiatives high on the agenda of international governments. This case study of India studies what trade facilitation may mean for a fast-paced economy. In this paper the authors use the trigger presented by the World Trade Organization’s (WTO’s) Trade Facilitation Agreement (TFA) to undertake a comprehensive review of various publicly available studies for India relating to performance measurement of the ecosystem that handles the cross-border movement of goods, focusing on the period since 2015. The paper summarizes the results of six key composite performance indicators—namely, (1) the Organisation for Economic Co-operation and Development’s (OECD’s) trade facilitation indicators (TFIs); (2) the World Bank’s Ease of Doing Business (EODB) Index; (3) the World Bank’s Logistics Performance Index (LPI); (4) the World Economic Forum’s (WEF’s) Global Competitiveness Index (GCI); (5) the World Bank’s World Governance Indicators (WGIs); and (6) the United Nations’ Global Survey on Trade Facilitation and Paperless Trade Implementation (GSTF-PTI). This paper, by examining these composite survey-based indicators and the intertemporal trends they exhibit for India, reveals that they have not been moving in agreement with each other and that some of the trends are evidently counterintuitive. A comparison between delineated subindicators of select composite indicators sometimes indicates surprising trends. Import cargo release times (a performance measurement prescribed by the TFA) for the largest containerized port in the country, the Jawaharlal Nehru Port Trust (JNPT), have been extracted from various studies that have relied on the data from the customs automation system; the container tracking system, which employs radio-frequency identification (RFID); and survey-based studies, including the Trading Across Borders (TAB) component of the World Bank’s EODB Index. These import cargo release time studies present a consistent trend of improvement since 2017. The paper, therefore, highlights the greater robustness of cargo release time trends, based particularly on technology-enabled data-driven studies as a more meaningful metric for measurement of performance of border management agencies and practices vis-à-vis survey or perception-based indicators representing “enablers” of trade facilitation.
Topic:
Economics, Trade, and WTO
Political Geography:
South Asia and India

8. Tracking Reforms in Land Leasing and Change in Land Use: Insights From Gujarat and Karnataka

Author:
Ankit Bhatia
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
As India’s economy has become more urban and industrialized, property and land rights have evolved, too. In the states of Gujarat and Karnataka, key reforms in land leasing and change in land use show what may—and what may not—be a path forward. India is primarily an agrarian society. More than 60 percent of its population is dependent on agriculture and allied services and dwells in rural areas. In the past couple of decades, India has attempted to shift away from its rural-agrarian base toward an urban-industrialized economy. In this journey, it encountered many challenges, but none remain as severe and persistent as the ones related to the assignment and balancing of land and property rights. Land governance in India remains historically complex, politically sensitive, and economically inefficient. In recent times, state governments have attempted proactive measures to reform the sector and bring greater efficiency to land markets. Despite the exigency of these reforms, issues surrounding equity, abuse of power, and nexus among powerbrokers remain central and require thorough analysis. To unpack the fuller effects of the recent reforms, this paper aims to examine key reforms in land leasing and change in land use sub-sectors initiated by Gujarat and Karnataka states. The paper takes a comparative assessment approach to decipher the nuances and complexities of land governances in the two states. Given that land has deep historical connections, this paper briefly delves into the historical evolution of land leasing and change in land use regulation in the two states. The historical analysis highlights the political economy context of each sector and is followed by an in-depth review of the recent reforms. The paper covers reforms effectuated through legislative, executive, and judiciary actions. This approach allows a comprehensive tracking of different mechanisms at play. The paper brings out some interesting findings. In both the states, the change in land use sub-sector was able to reform more frequently than the land leasing sub-sector. Despite both states relying upon all three branches of government to initiate reforms, executive action was used most frequently. On occasion, the judiciary played a critical role, especially when lower branches passed judgments that provided windfall relaxation to the protective regulation. Further, the paper finds that most reforms were not structural in nature; they were merely attempts to ease the restrictions on the transfer of agricultural land. In a complete departure from past objectives, recent reforms attempted to dilute the protective framework of land leasing and change in land use regulation. It is understandable that socioeconomic and political realities have shifted and the archaic regulation may not serve its intended purpose. However, the recent reforms have failed to show a concrete new direction. Instead, they largely focused on allowing a greater transfer of land resources to industries, pushing toward more capital-intensive agriculture, and promoting digitalization of land-related governance and public service delivery.
Topic:
Reform, Economy, Urban, and Land Reform
Political Geography:
South Asia and India

9. How China and Pakistan Negotiate

Author:
Katharine Adeney and Filippo Boni
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Since being officially launched in April 2015, the China-Pakistan Economic Corridor (CPEC) has been one of the most watched set of projects under the aegis of Chinese President Xi Jinping’s signature Belt and Road Initiative (BRI). Having already injected around $25 billion into Pakistan, the CPEC not only has been dubbed the “flagship project” of the BRI, but it also holds a central role in Beijing’s global ambitions.1 While much has been said about the geopolitical implications of the CPEC, including for both India and the United States, less attention has been devoted to providing in-depth insights into the mechanics of how the BRI is unfolding on the ground in Pakistan. How do China and Pakistan negotiate the terms of CPEC deals? To what extent has Islamabad managed to exert agency in its dealings with Beijing? How does China adapt to the contexts it operates in? By now, the CPEC has been subject to much media, academic, and policy scrutiny, but these questions have not been answered. The power asymmetry between the two partners—coupled with the impression that the BRI represents a unidirectional Chinese endeavor, not just in Pakistan but also globally—has contributed to the erroneous representation that Beijing is merely imposing the CPEC on its all-weather partners in Islamabad. On the contrary, this study highlights China’s adaptive strategies in dealing with a host of Pakistani actors (including political parties, local communities, and the military) against the backdrop of Pakistan’s evolving political landscape and change in leadership following the country’s 2018 elections. In filling this gap, this paper foregrounds the importance of adopting a relational approach to studying how the BRI unfolds on the ground. This entails looking at how Pakistan and China have negotiated the CPEC’s energy, infrastructure, and industrial cooperation projects. The analysis is based on semi-structured elite interviews conducted by the two authors during three rounds of fieldwork in 2015, 2018, and 2020–2021 triangulated with a host of official reports, statements, and newspaper articles. Examining the domestic contours of the CPEC shows that Pakistani actors have wielded agency in important ways throughout the process, while Chinese actors at times have accommodated key Pakistani demands.
Topic:
Energy Policy, Bilateral Relations, Geopolitics, Economy, and Belt and Road Initiative (BRI)
Political Geography:
Pakistan, China, South Asia, and Asia

10. The Local Roots of Chinese Engagement in Pakistan

Author:
Muhammad Tayyab Safdar
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
China has deepened its economic engagement with Pakistan through elite-centered negotiations over the routes and projects of the China-Pakistan Economic Corridor (CPEC). But elites are not the whole story: China has made inroads beyond Pakistan’s political elites with a broader array of local stakeholders in the country’s education, media, and energy sectors. Pull factors in each of these areas are giving local Pakistani actors incentives to develop closer relationships with Chinese actors. In education, China’s status as a rising global power and the promise of future economic returns have driven ever more Pakistanis to learn Mandarin and opt to study abroad in China. In the media sector, the financial pressures facing Pakistan’s private media houses have contributed to increasing domestic buy-in for news sharing agreements with Chinese media organizations. In the power sector, the lack of alternative sources of external funding for local Pakistani conglomerates has resulted in the emergence of joint ventures on electricity generation projects with large Chinese state-owned enterprises (SOEs). At the same time, Chinese government policies are serving as push factors to incentivize Chinese actors to expand their interactions in different segments of Pakistani society. For example, China has opened and sponsors Confucius Institutes and classrooms across Pakistan, while also offering scholarships to Pakistani students interested in studying in China. As Chinese firms have expanded their presence in Pakistan, they have worked with local universities to adapt to local customs and cultural and religious values. In media circles, stakeholders like China’s Xinhua News Agency have worked with local Pakistani media outlets to localize information dissemination and shape Pakistani public opinion on important international issues in ways that are in sync with Beijing’s worldview. And Chinese investment in Pakistan’s power sector is aligned with Chinese SOEs’ Go Global strategy and the expansion of these firms’ operations in overseas markets as part of the BRI. China’s engagement with Pakistani political, social, and economic institutions comes in response to local conditions. By adapting to these conditions and working through local institutions and actors, a host of Chinese actors are poised to continue deepening their interactions with different parts of Pakistani society.
Topic:
Education, Partnerships, Media, Economy, and Engagement
Political Geography:
Pakistan, China, South Asia, and Asia

11. Tangled Wires: Preparing India’s Power Sector for the Clean Energy Transition

Author:
Jonathan Kay
Publication Date:
08-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Almost none of the world’s largest polluters have enacted policies compatible with the Paris Agreement’s target of limiting global warming to within 2 degrees Celsius, a threshold past which climate disruption is projected to become even more frequent, severe, and unpredictable. Fortunately, despite the absence of adequate government support, renewable energy has grown at an astonishing pace in recent years thanks to its plummeting cost. India, for example, has more than doubled its stock of wind and solar power in the last five years, driven less by sustainability concerns than by clean energy’s potential for cost-effectively meeting citizens’ pressing development needs. However, the low prices of wind and solar projects disguise the structural costs renewable energy poses for grids when deployed at larger scales. The intermittent, unpredictable nature of the electricity generated by such technologies—in contrast to the stable, on-demand flow of power from traditional fossil fuel generation—requires fundamental changes to how countries invest in and operate their grids. For India, one of the most important steps for coping with the variability of these new sources of energy will be better coordination of the flow of power between the country’s disparate state-run grids. By increasing the volume of energy traded between state utilities, periods of surplus power in one region can compensate for deficits in others, making for a more stable and reliable supply of renewable energy—one that can better displace expensive and polluting fossil fuels. Yet, while such reforms would be difficult under the best of circumstances, they will be particularly challenging given the unique dysfunctions of India’s power sector. With its politically compromised, perennially loss-making electricity distribution companies already struggling to keep the lights on, bolder change appears unlikely. Deeper reforms to India’s power sector are therefore prerequisites to adopting solutions like regional coordination that can ensure the continued growth of renewable energy. The good news is that Prime Minister Narendra Modi’s national popularity and the dominance of his Bharatiya Janata Party (BJP) at the state level offer the country’s leaders an opportunity to reform the power sector where others have failed. But to take advantage of this opening, Modi must go beyond his modus operandi by investing in incremental institutional solutions rather than one-and-done technical fixes and by serving as a coordinator for India’s states rather than legislating by central fiat. Deeper reforms enabling India to maintain its rapid expansion of renewable energy not only would provide clean, low-cost power to its people but also would help the world offset the failings of more laggard countries, perhaps even putting back within reach the Paris Agreement’s more aggressive target of keeping global warming to within 1.5 degrees Celsius. But the hardest part of this ambitious task lies ahead—in ending the vicious cycles that have plagued India’s power sector for decades.
Topic:
Climate Change, Pollution, Fossil Fuels, and Energy
Political Geography:
South Asia and India

12. Understanding the Encryption Debate in India

Author:
Anirudh Burman and Prateek Jha
Publication Date:
09-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Encryption has become a contentious instrument for protecting the security and confidentiality of online communication. Rapid digitalization in the past decade has led to the proliferation of domestic and foreign online communication services that use encryption and, consequently, pose challenges to national security bodies and law enforcement agencies (LEAs). To address these challenges, the Indian government introduced new regulations in February 2021. These regulations require large social media platforms to enable traceability, or the ability to provide information concerning the originator of online communications. Technology companies and privacy activists have opposed such a move on the grounds that traceability would require the breaking of the end-to-end encryption used by many online communication platforms like WhatsApp and therefore would compromise the security of online communications on such platforms. This traceability requirement, however, is only the latest development in a drawn-out, contentious debate over the use of encryption. The contestation between maintaining higher degrees of online security and issuing new rules to grant technological exceptions for security agencies and LEAs is not specific to India. One of the first serious discussions on the issue took place in the United States in the 1990s, when public opposition warded off an early government attempt to sidestep encryption protections with a court order. In the past decade, the use of encryption has only grown more pronounced. The revelations that the United States’ National Security Agency was collecting vast amounts of communications data led to the introduction and increased adoption of end-to-end encryption for online communications. End-to-end encryption is now used widely by online communication platforms like WhatsApp, Signal, and Threema. Its use presents law enforcement and national security agencies with new challenges. Even though these agencies today have greater and easier access to more information than ever before, the absolute confidentiality provided by encrypted online communication platforms makes it harder for these agencies to engage in real-time surveillance to investigate crimes and identity wrongdoers. While some policymakers from India and other countries argue that encryption must only be weakened to solve specific problems, most experts agree that, as of today, there is no technological solution that would weaken encryption for specific law enforcement and national security purposes, while managing to maintain preexisting levels of security and confidentiality for general use. The introduction of any mechanism for specific access would, it is claimed, introduce both known and unknown vulnerabilities into these communications platforms. Such a mechanism would have a systemic effect on all online communication dependent on encryption for ensuring security and confidentiality. In India, these developments create challenges in specific ways. For example, India reports the highest number of child pornography cases worldwide, and encrypted communications makes it difficult to identify culpable parties. Similarly, as India has digitized rapidly, there has been a surfeit of fake and offensive online news that has, in some cases, led to mob lynchings. In addition, terrorist networks have been found to be using encrypted communication channels while planning and carrying out terrorist attacks in India. Over the years, the Indian government’s approach to encryption has responded to these concerns in a variety of ways. Indian financial regulators mandated the use of encryption for banking and financial services as they realized the security of such transactions was best protected through encryption. At the same time, the Indian government prohibited telecom operators from implementing bulk or mass encryption in telecommunication services. Starting in 2015, the government introduced different regulatory proposals requiring that messaging platforms and other communication service providers provide plaintext copies of communications to Indian government agencies on request. These proposals, however, faced significant opposition and were withdrawn. Earlier in 2021, the Indian government’s new rules requiring traceability have been officially notified. The mechanisms through which they will be implemented are not yet clear. It is also unclear if these rules are the last demands the Indian government will make to weaken encryption, or whether further demands will arise in the future. To weigh the relative benefits and drawbacks of the Indian government’s proposal, analysts should consider relevant factors such as (but not limited to) whether such changes will offer law enforcement officials the access they desire, how the security of encrypted communications will be affected, and how citizens’ civil liberties will be impacted, among others.
Topic:
Security, National Security, Science and Technology, Law Enforcement, Digitalization, and Encryption
Political Geography:
South Asia and India

13. India’s Fog of Misunderstanding Surrounding Nepal–China Relations

Author:
Vijay Gokhale
Publication Date:
10-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
India’s postindependence ties with Nepal were predicated on the intimate cultural and historical links between the two countries. As India’s first prime minister, Jawaharlal Nehru, noted, “though Nepal was an independent country, it was very closely allied to India in culture and tradition and we did not look upon it as a foreign country.” New Delhi also regarded China as an “interloper” in Nepal in 1950 who threatened India’s security and interests in the region, ignoring at least a century of Sino-Nepali history centering around Tibet. This paper argues that New Delhi’s close relationship with Nepal, bound in history and culture, and the misperception about China’s relations with Nepal before 1950 have contributed to a skewed understanding of Sino-Nepali relations. The Working Paper looks at the impact that New Delhi’s misperceptions of Sino-Nepali relations, termed the “fog of misunderstanding,” has had in the context of the triangular relations between China, India, and Nepal. The paper is divided into four sections arranged chronologically. The first section looks at the historical Sino-Nepali relationship from the mid-eighteenth to the mid-twentieth centuries. It establishes that this early relationship was centered on Tibet. While the Gorkha kings of Nepal sought to preserve their trade privileges in the region, the Chinese were concerned about the security of their southwestern frontier. Notably though, Beijing’s concern with security does not appear to have extended into any desire to conquer Nepal. This section also touches upon British India’s policy toward Nepal in the nineteenth century, and the subsequent approach that the government of independent India took in the first few years, without an adequate appreciation of Kathmandu’s history with China. As a consequence, India developed a suspicious attitude toward Beijing’s desire to re-establish ties with Kathmandu after the Chinese Civil War, and shaped its policy toward Nepal with this factor in mind. The second section delves into Indian and Chinese policies toward Nepal in the period from 1955 until the end of the monarchy in 2008. It showcases how, during this long period, the three kings of Nepal sought to leverage their ties with China in order to maintain some semblance of balance and how China, in turn, followed a limited but strategic approach that was centered on the kings. The fog of misunderstanding continued to shroud India’s attitude to Nepal-China relations during this period and, consequently, India’s Nepal policy lacked a working template to manage relations with a smaller neighbor sandwiched between India and China in a way that would preserve New Delhi’s influence in a positive way. In contrast to China’s political approach, New Delhi fluctuated between the monarchy and an assortment of democratic political parties, suggestive of a provincial approach in New Delhi’s dealing with Kathmandu. As a result, China’s approach ensured that its main objective in Nepal, namely the security of its southwestern frontier, was secured with a relatively low-risk and low-cost strategy. The third section deals with the aftermath of the fall of the Nepali monarchy, 2008 to 2016. During this important period, New Delhi had a fresh opportunity to reset ties by providing the support to democratic forces in Nepal, that could have resulted in a transformation of the Indo-Nepali ties. However, India appeared to hew to its traditional policy. China, on the other hand, quickly built new ties with the post-monarchical dispensation. India’s perceived actions as a result of the adoption of the new constitution of Nepal plunged Indo-Nepali ties to a nadir. It seems to have pushed Kathmandu to strengthen its relationship with China. This section of the paper also outlines the changing nature of China’s policy and objectives in Nepal, especially in the second decade of the twenty-first century, and its possible implications on the future course of the triangular relationship, as well as for India-Nepal relations. It postulates that under President Xi Jinping, China’s policy toward Nepal has shifted from protecting its periphery to a broader goal of bringing Nepal under its strategic control. This section highlights the political and economic levers that Beijing is using to build a preeminent position in Nepal. The paper concludes with an assessment of options available to all three countries going forward, and India’s options in Nepal in the face of China’s new policy in the region. It suggests that a decisive reset in policy toward Nepal is required to restore healthy relations that are based on mutual respect and mutual sensitivity. New Delhi may need to re-orient its thinking toward Nepal in the context of triangular relations, including on the boundary issue and the 1950 Treaty of Peace and Friendship that have been long-standing irritants in the India-Nepal relationship. Nepal, for its part, should also reflect carefully on whether its leveraging of China might become counterproductive in the light of changing strategic balance in its vicinity, and the implications of giving up the policy of balance for one that tilts decisively toward Beijing. The paper concludes that there is sufficient scope and opportunity for course correction by India, and that through sustained efforts India may be able to preserve its influence and security in Nepal and counter China’s expanding footprint.
Topic:
Security, Foreign Policy, Bilateral Relations, and Geopolitics
Political Geography:
China, South Asia, India, Asia, and Nepal

14. China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries

Author:
Deep Pal
Publication Date:
10-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
China’s economic and political footprint has expanded so quickly that many countries, even those with relatively strong state and civil society institutions, have struggled to grapple with the implications. There has been growing attention to this issue in the United States and the advanced industrial democracies of Japan and Western Europe. But “vulnerable” countries—those where the gap is greatest between the scope and intensity of Chinese activism, on the one hand, and, on the other, local capacity to manage and mitigate political and economic risks—face special challenges. In these countries, the tools and tactics of China’s activism and influence activities remain poorly understood among local experts and elites. Both within and beyond these countries, meanwhile, policy too often transposes Western solutions and is not well adapted to local realities. This is especially notable in two strategic regions: Southeastern, Central, and Eastern Europe; and South Asia. China’s economic and political profile has expanded unusually quickly in these two regions, but many countries lack a deep bench of local experts who can match analysis of the domestic implications of Chinese activism to policy recommendations that reflect domestic political and economic ground truth. To address this gap, the Carnegie Endowment initiated a global project to better understand Chinese activities in eight “pivot” countries in these two strategic regions. The project’s first objective was to enhance local awareness of the scope and nature of Chinese activism in states with (1) weak state institutions, (2) fragile civil societies, or (3) countries where “elite capture” is a feature of the political landscape. Second, the project aimed to strengthen capacity by facilitating a sharing of experiences and best practices across national boundaries. Third, the project sought to develop policy prescriptions for the governments of these countries, as well as the United States and its strategic partners, to mitigate and respond to activities inimical to political independence or well-balanced economic growth and development. To establish a comprehensive picture of China’s activities and their impact, this project dug deeply into Chinese activism in four case countries in each region—eight countries in total. We began by holding workshops, so that influencers across countries could share experiences and compare notes. Invited participants included policymakers, experts, journalists, and others—all with deep local knowledge, steeped in their countries’ politics, economies, and civil societies. In Europe, the four countries were Georgia, Greece, Hungary, and Romania, and in South Asia, Bangladesh, Maldives, Nepal, and Sri Lanka. Cross-national discussions among these regional participants aimed to raise awareness, discuss the implications of China’s growing activism in their countries, and compare notes on the diverse ways in which these various countries had managed the rapid influx of Chinese capital, programs, people, technology, and other sources of influence.
Topic:
International Relations, Foreign Policy, Development, Economy, Engagement, Regionalism, and Resilience
Political Geography:
Bangladesh, China, South Asia, Sri Lanka, Nepal, and Maldives