PM Narendra Modi may use economic card with China to negotiate entry into NSG

Prime Minister Narendra Modi has used the economic placard to good effect with Pakistan and SAARC members and seems to be doing the same with China.

Written by Kanishka Singh | Updated: October 10, 2016 6:53 pm
china, nsg, india nsg bid, india china ties, saarc summit, india saarc, make in india, nsg membership, nuclear suppliers group, china india nsg, india news Chinese economy has suffered a slowdown and India is one of the major markets for Chinese goods.

China has now offered an olive branch to India in the name of open discussions for India’s bid to gain membership into the coveted 48-nation Nuclear Suppliers Group. Chinese officials recently indicated that they are willing to explore all possibilities for India’s entry into NSG that allows its members to trade in civil nuclear technology. It seems unlikely that the Chinese will budge from their position of India’s impending entry, but New Delhi has gained significant ground since then. The expansion of India’s geopolitical and strategic influence has put China in a quandary and it now seeks to save its economic interests in the region.

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Prime Minister Narendra Modi has used the economic placard to good effect with Pakistan and SAARC members and seems to be doing the same with China. The PM’s move to boycott the SAARC summit in Islamabad and walk away from trade with Pakistan would have sent strong signals to Beijing. Although there is huge presence of Chinese companies in India, PM Modi will look to úse Indian market access to negotiate China’s nod for entry.

Chinese economy has suffered a slowdown and India is one of the major markets for Chinese goods. PM Modi’s push for Make in India seeks to boost the manufacturing sector and change India from an importing nation to an exporting nation. India-Pakistan tension is not in the best interest of China as it enjoys good economic relations with India and it will also not want to endanger its $46 billion China-Pakistan Economic Corridor. Also, massive overinvestment in infrastructure by China and plummeting commodity prices have left it in a weak position economically and it is no longer the juggernaut that it was five years ago.

India had moved its formal bid to enter the NSG on May 12 this year and despite India not being a signatory of the Nuclear Non-Proliferation Treaty, it had got the support of members like the US, France, UK and more. China, which enjoys a de facto veto since the entry is only granted on basis on consensus, blocked India’s entry. Also, it has supported Pakistan’s entry into the group, a country whose proliferation record causes concern across the globe.

India’s non-proliferation record and following IAEA safeguards gained it an exclusive waiver in 2008 for the India-US civil nuclear deal. India’s entry into the NSG will significantly boost PM Modi’s plans to build a number of nuclear reactors across the country in partnership with US, Russia and France to reduce reliance on fossil fuels and in turn strengthen trade and strategic relations with these countries.

India will host the five-nation BRICS summit this October 14-15 where leaders from Brazil, Russia, India, China and South Africa will meet for bilateral and multilateral cooperation and trade negotiations. Chinese President Xi Jinping is expected to meet PM Modi on the sidelines of the BRICS summit and the topic of India’s NSG membership is likely to come up.

After India’s bid was blocked, a US think tank came out with a report that revealed China had flouted international norm for civil nuclear trade and provided nuclear reactors to Pakistan. India will look to use that card to corner China with its own strategy.

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