A tripartite arrangement
By Shahid Javed Burki
Published: August 29, 2011
The West’s turn away from letting the state play an important role in shaping the structure of its economy and society will have important consequences for the entire world. Some of these will be negative, some positive. They will be positive, at least for those countries whose leaders are able to look into the future, not only to meet the challenges it will bring but also make use of the opportunities that may be on offer.
Some of the public policy choices should be made in the context of the three large countries of mainland Asia — China, India and Pakistan. They will have to be tailored to meet their own needs and circumstances. China will need to work out how it will continue to make the transition to an open market while continuing to limit the openness of the political system. It will also have to determine the role it will have to play in shaping the global economy, now that it has become the worlds’ second largest economy and may, by 2015, overtake the United States.
India, after a remarkable two-decade long record of uninterrupted high rate of economic growth is losing some of the momentum it had picked up in this period. Large segments of its population remain unaffected by the economy’s rapid growth. In the middle of 2011, the country was convulsed by the popular reaction to several incidents of large-scale corruption on the part of senior elected officials and by the officers of the military. Being a vibrant democracy it will have to find a way out of the resentment that has built up within a short period of time.
Pakistan, the third country in this group has the weakest economy, a highly troubled society and an unsettled political system. Some have said — including Hillary Clinton, the United States Secretary of State — that the country is faced with an existential threat. The World Bank’s 2011 World Development Report includes the country among what it regards as fragile states. It is in the strategic interest of its two very large neighbours — China and India — to ensure that the country does not stumble so badly that it succumbs to the eventual control by the extremist forces that are operating in the country. A fracturing — even a greatly unstable — Pakistan will not be good for its neighbourhood, certainly not for China and India.
Some of the responses by the mainland Asia to the developing situation in the West will, and should, take the form of bilateral relationships — Pakistan working with China, China working with India and India working with Pakistan. Some of this is happening. Snubbed by the United States, Pakistan has turned to China for economic assistance, military support and simply for some encouragement in what Islamabad considers to be a very ‘unfriendly world’. The two countries have developed what both call an “all weather friendship”. While Beijing is reluctant to get very involved in Pakistan’s growing rift with the United States, it is prepared to give signals to the world that it supports Islamabad in many different ways.
While both Beijing and New Delhi continue to watch each other with some suspicion; while India remains disturbed that China continues to hold some of the territories it considers its own and has not withdrawn its claim to the Indian state of Arunchal Pradesh; and while Beijing is unhappy that New Delhi has given refuge to Dalai Lama from where he continues to operate, the two countries have learnt to work with one another. This is particularly the case in bilateral trade which has grown rapidly and now amounts to over $40 billion.
Notwithstanding these bilateral responses by the three countries to the enormous changes in the global economy, there is also some space for the three countries to work together. Not only do they account for 40 per cent of the world’s population, they also cover a good part of the world’s total area. This trilateral relationship will have to develop institutional underpinnings in addition to the improvements in the trade and communication links that already exist.
Source: A Tripartite Arrangement