China: The Challenges Ahead


Last week, the Extra Mural Lectures team in collaboration with Distinguished Lecture Series under the Ministry of External Affairs and Centre for Chinese Studies IIT Madras invited Shri Nalin Surie, former ambassador to China and renowned economist, to deliver a lecture ‘China: The Challenges Ahead’ which commenced at 6pm in the main auditorium of IC&SR building.


In his opening address, Shri Nalin Surie recalls President Xi Jinping New Year’s address to the Chinese people the previous year. He quotes, “We have only one Earth. This is the homeland of all the people in the world. The world is too big and the challenges are many to go without the voice of China being heard, without solution ideas from China being heard, without the involvement of China being needed. China will, as always, open its arms to embrace the world, and offer its helping hands to those in need. Our circle of friends will grow bigger.” In the end, President Jinping implored the international community to join hands with China in a concerted effort to make peace, and relate to each other in cooperation rather than in confrontation.

In matters of future, President Xi Jinping went on to highlight the five major issues which China is likely to face. He believes that the State must guarantee people’s right to livelihood and physical health. Secondly, 2015 marks the beginning of a decisive phase to build China into a comprehensively moderately prosperous society. Third, China must seek innovative, coordinated, green development that is open and shared by all. Fourth, China must provide a clean and healthy political environment, free of corruption. Lastly, the President personally feels “a moral  and emotional obligation to get the tens of millions of rural population out of poverty and let them lead a peaceful life.” 

China, today,  is a country amidst substantial social, religious, economic and political change. The impact of the global economic crisis and deviation from the Beijing model undermines the economic growth and also question the political structure of the country. With the continued depression in global economy and growth rate in its partner nations, China succumbed  further to infrastructure-led growth. Activities over the past few decades leading to a series of natural disasters including serious climate change, have affected the credibility of the Communist Party. Corruption continues to threaten the Communist Party of China to rule.

In this context, it is important to remember the mandate given by the 18th Party Congress of the Chinese Communist party. The mandate included Fight against Corruption, China’s mission to become the economic power by 2020, modernisation of national defence, improvement in field of space and cyber security, creating or strengthening their ties with other nations, promotion of cultural and spiritual heritage of their nation, among other aspects. The mandate stresses that China would seek the support its overseas community for reaching its goals and objectives. The party has stuck to the mandate provided at the 18th National Congress Party.



Shri Nalin Surie accepts that China has risen. It is now the second largest economy in the world though it is the most populated nation. As a developing nation, it would reach its goal of incrementing the GDP and per capita income of the nation by 2020.  However, its growth rate has decreased and it faced inadequate success in tackling the global economic crisis. Also, China’s effort to reorient its development paradigm with greater stress towards domestic consumption and demand have has not been adequately successful.

China is also the world’s second largest trading partner and would probably grow to become the single largest trading partner. China’s dependence on the international economy is very substantial and likely to remain so in the future and this could lead to stable disability. Addressing its major long term economic requirements or ambitions, China had taken up programmes through the ‘One Belt One Road’ initiative(which is a comprehensive effort to improve connectivity and cooperation among countries especially those in Eurasia) and the Asian Infrastructure Investment bank. They have increased their overseas investments for long term development interests.



China has grown to become one of the strongest military forces which can not only defend its own defined territories but also its overseas interests. However, China’s growing militarisation has had a domino effect and some nations have responded to it by incrementing their military budget, developing security partnerships with others and axiomatically strengthening the US pivot towards Asia. Its relentless pursuit of defence modernization and comprehensive restructuring of the People’s Liberation Army(PLA) and the military establishment has raised a few concerns owing to the aggressive postures taken and the lack of intent. They would be threatened by a potential regime change in the government by the military. Arguments can thus be made that Chinese aggression has been counterproductive.

China’s increasing attempts to become a leading nation in the Asia-Pacific region have also emulated a focus response from the US. China believes it is at par with the United States of America in spite of lower global outreach. It believes in strengthening itself through stronger ties with USA. It considers ties with Russia as a partnership while that with the USA as a ‘new model of major country relations’. Europe will remain an economic partner and a source of high end technology and economy.


Xinhua, the Chinese official newspaper, outlines the changes brought about by President Xi Jinping during his term. During his three-year term, there has been strong economic growth but complicated international scenarios and domestic problems have not made it easy.  Innovation and new ventures were promoted. Over 11000 new enterprises have been established, which are helping improve the Chinese economy. However, it also highlighted the issues in urbanisation, poverty, and urban work. Plans implemented between 2011 and 2014 have lifted millions from poverty but many who continue to reside in rural areas still face poor living standards.

The accumulation of wealth is no longer adequate. President Xi Jinping stresses upon the need for better governance and strengthening the laws in China.  Under the leadership of President Xi Jinping, the CPC describes having to face “hard nuts to crack”, as 30 years of rapid economic growth have led to a situation where political reforms are no longer easy to undertake. Reforms though have been initiated in the judicial sector, taxation sector, and in state born enterprises, public hospital, rural land and more.  Even soccer reforms have been made as there was a lot of corruption in the soccer industry.

Corruption has been dealt with with more focus than any other issue during President Jinping’s rule as it had escalated and become very serious over the past few years. There remains the delicate problem of ensuring that the party is essentially above the rule of law while major violators should be punished to demonstrate the party’s commitment to the rule of law. Another issue projected was supremacy of the party over the Government and the Constitution. While China has done exceedingly well on the economic front,  the Chinese model of rapid economic development led by exports and infrastructure development has now plateaued. Mr Surie cites a few problems such as the rise in price and shortages, growth in inequality, overcapacity in many sectors and so on. It must be understood that Chinese economy will not collapse but one wonders how long it would last. He also goes on to exclaim that we shouldn’t underestimate China’s ability to withstand economic shock.

On the social front, China tried to implement a ‘One Child’ policy to control the population expansion in the country,  which was relaxed in late 2013 for a variety of social, economic and political reasons. Patriotism has become an important instrument for mobilisation of the people to follow the Communist Party of China. Patriotism is deeply rooted in the people’s mind and holds together the unity and solidarity of various groups hailing from within China. There has been a call to make patriotism an internal theme of Chinese education. Spiritual and religious belief is being promoted so that ‘men and women on the street have other diversion’.


Q&A session

Following his lecture, there was a stimulating round of questions. Sensing much hostile tension, Shri Nalin Surie says China is not an enemy to our great nation. In fact, much could be learned from them and vice versa.




Question 1: How did industrialisation help in double digit growth in China but failed to have the same effect on India?

The countries followed different models of industrialisation. India didn’t focus on industrialisation as much as China. China jumped from being an agricultural state to a manufacturing state whereas India was already at an early state of industrialisation. We’re presently moving from service into manufacturing whereas China is doing the opposite. We follow different paths but might ultimately end up with the same result. The main driving force in our country is the domestic demand.

Question 2: Since China plans to move towards a service-driven economy, would a gap be created in the manufacturing sectorfor India to emerge as a major player in the sector?

You can’t deny that there would be opportunities but fact remains that China will not stop becoming a manufacturing power. It is a growing economy and it’ll keep growing. The difference is now they shall vacate the lower and medium level sectors where opportunities will be created for other nations and move to the innovative sector. We would still have to compete with nations like Indonesia, Vietnam, etc in that sector. When a spot opens, it does not imply that it would automatically become ours.

Question 3: What do you think are the reasons for the current downward spiral in the Chinese economy? Would it collapse?

There is no downward spiral. The economic growth rate has only decreased or the growth has only plateaued. It is highly unlikely that an economy as large as China would collapse.

Question 4: What do you think about democratic movement in China? Would it affect their economy?

As you develop, money is no longer adequate. You’ll require more than money for further growth. So they opened the doors of religion, travel, education abroad and so on. Opening multiple doors also meant they would have to succumb to influence of external forces. People wish to know why certain actions practised elsewhere are prohibited. This thinking gives rise to a certain change. There is no democratic movement.

Question 5: Can you throw some light on the Chinese education system and compare it with ours. What reforms must be taken to better ours? Or can we learn from theirs?

There are fundamental differences between the two systems but there are similarities as well. The difference is that they do not have anything like the UGC (University Grant Commision). There is nothing known as independence of universities in the sense that they are run by the State and hence the party. So the State can implement a system of higher education they want to. China is sending thousands of students outside the country to learn in the best universities abroad at Government expense. This is, however, difficult in India due to its smaller budget.

Shri Nalin Surie feels that China has outdone India in terms of higher education, many such centres doing excellent work in fields of humanities and scientific development but would prefer primary and secondary education in India. He admits that China has also done exceedingly well in literacy. China also has the advantage of following only one language unlike in India.  He feels having multiple educational programmes throughout the country has many issues arising due to difference in levels and standards of each system. To better our system, we need to have high standards and maintain these standards. We should increase our student exchange programmes and send students out at the expenditure of the government. Our system must be made more organised.

Question 6: What is the role of China in conquering global terrorism, especially ISIS?

China thought it could ignore the issue of terrorism but over past few years, they have realised that this is no longer possible. So now they are actively engaging in global fight to contain terrorism. In President Xi Jinping’s recent travels to Iran, Saudi Arabia, etc, there have been talks about helping nations fight terrorism with China’s cooperation. China has serious concerns about Xinjiang, a territory in the North-west of China which has been in a state of turmoil on account of the violences committed. They presently have a law against terrorism which allows you to put anyone behind the bar but this doesn’t solve the problem. There must be international collaboration. A draft against terrorism set forth by India is still under negotiation. A major country like China being on board would definitely gain more support for the motion and the fight against terrorism would become much easier. One of the reasons they are still not in favour with this is because some of their allies, such as Pakistan, would get affected. We must be rather realistic and not emotional about this topic.

Question 7: There was a time when Indian Foreign Service was one of the most desirable services in the country but lately population has begun to favour Indian Administrative Service. Why is this so?

Shri Nalin Surie’s instinctive initial answer, “Their fault. Their mistake”, was accepted with a huge round of applause and laughter. He affirms that it is still the best service in the country and it is unfortunate that people do not join it and it is their mistake. It is a service where you can contribute enormously for the good of the country with various fields such as foreign security, foreign outreach, and so on. Through IFS, the amount you can do for your country is unbelievable. You can rewrite relationships, turn your enemies into your friends, fnd technology unavailable in your country which may be useful to the general population and help reduce poverty. When you’re in a foreign nation, you can learn from them and analyse what reforms are necessary back in your country. The bulk of the work being done is economic and not political. You will not learn as much as you do in the Indian Foreign Service as you do in any other profession. You also learn how much your country is respected and valued abroad.

Question 8: Can you comment on the red alert situation in Beijing due to pollution? What effect does it have on China? Was this caused by the manufacturing strategies followed by China? If so, will the same scenario arise in India if India tried to increase its manufacturing capacity?

China is facing a severe problem of environmental pollution but they have been taking steps over the past decade in particular to mitigate that.  It is not possible to make changes overnight, say switching all your power from thermal to wind or whatever the case may be. They are in the process of change. They now focus on sustainable and green development. They are the world’s largest manufacturers of solar panels. Apart from air pollution, they also face environmental pollution in form of degradation of their rivers. They are addressing it now. The world benefitted from a low cost production in China. Back then, the world was not bothered by the pollution levels. While speaking about Beijing, we must not ignore that Delhi is also heavily polluted. This has been caused by not Make in India but because of the massive construction undertaken in and around the city and plying of huge number of vehicles running on diesel. In comparison, we have not been able to contain this in over 15 years whereas Beijing has stabilized over 6 months. China’s fighting hard to overcome pollution and climate change just like India.

Shri Nalin Surie feels that Make in India will not necessarily put India in the same situation. In fact, we could learn from China. We’re in a better position to avoid these mistakes. We could identify our problems, understand their solutions or come up with our own. Bulk of India is not polluted. Only our major cities have reached alarming levels, whereas the problem is more widespread in China. They are dealing with it much more than India. We must ensure that the same mistakes will not be made.

Question 9: How do we convince China and earn their vote for the permanent membership in the United Nations?

Shri Nalin Surie believes that China has actually taken forth a very straightforward position, unlike other Security Council members, who despite friendly gestures towards India, have not strongly pushed for India’s permanent membership. China supports what it claims is a greater role for India in the United Nations in matters of international relations but they cannot allow another permanent country from Asia, especially their largest economic neighbour. He is not particularly optimistic on this topic and believes if such a decision is taken, it would be suddenly when we’re dealing with a crisis or when we no longer desire the permanent membership.  
The crowd raised various other queries related to China-Tibet integration, SAARC countries, his opinion on how the Chinese would interpret India’s efforts to strengthen ties with other nations and more. The lecture covered, as the title suggests, the various problems a developing nation would face in its path and how China has coped, and is coping, with these problems. Overall, it was an informative lecture and offered unique perspective on China to the audience. Thank you, Sir.


Photo credits : The Extra Mural Lectures Team

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