⦁ Why in News:
⦁ India on Thursday blamed China’s deployment of a large number of troops and armaments for tensions along the Line of Actual Control (LAC) and said it expected the Chinese side to work towards the early resolution of outstanding issues in Ladakh sector.
⦁ The Indian side has only made counter deployments in response to China’s “provocative behaviour and unilateral attempts to alter status quo” on the LAC and to fully protect the country’s security interests.
⦁ India’s Response:
⦁ India has moved in additional divisions, tanks and artillery across the LAC to match Chinese deployments.
⦁ Further, India has approved the purchase of 33 Russian fighter jets and upgrades to 59 war planes at a cost of Rs. 18,148 crore.
⦁ Citing the “emergent nature of threats” from mobile applications, including popular ones of Chinese origin such as TikTok, ShareIt, UCBrowser, and Weibo, the government has banned 59 apps.
⦁ Further, India’s trade deficit with China fell to $48.66 billion in 2019-20 on account of the decline in imports. The trade deficit stood at $53.56 billion in 2018-19 and $63 billion in 2017-18.
⦁ However, the tensions on the border, as well as the Covid-19 pandemic, have thrown light on India’s economic dependencies on China.
⦁ India remains reliant on Chinese products in several critical and strategically sensitive sectors, from semiconductors and active pharmaceutical ingredients to the telecom sector, where Chinese vendors are involved not only in India’s 4G network but in on-going 5G trials as well.
⦁ Foreign Direct Investment (FDI) from China in India has dipped to $163.78 million in 2019-20 from $229 million in 2018-19.
⦁ In April 2020, the Indian government tightened FDI norms coming from the countries which share land borders with India. Government approval has been made mandatory.
⦁ China’s Reaction:
⦁ It has described the app ban action as “a deliberate interference in practical cooperation” between the two countries. China’s State media has warned of economic repercussions, such as affecting outbound Chinese investment into India.
⦁ Possible Reasons Behind Increased China’s Deployment at the LAC:
⦁ India’s decision to strengthen its border infrastructure (Darbuk-Shyok-Daulat Beg Oldie road).
⦁ India’s United States tilt (e.g. Quad) amid US-China tensions.
⦁ China views India’s assertions regarding Gilgit-Baltistan, as an implicit attack on the China-Pakistan Economic Corridor (CPEC), China’s flagship programme.
⦁ China’s growing assertiveness over the South China Sea.
⦁ Political and economic tensions within China due to Covid-19 pandemic.
⦁ India being a growing power in Asian region.
⦁ Line of Actual Control:
⦁ Demarcation Line: The Line of Actual Control (LAC) is the demarcation that separates Indian-controlled territory from Chinese-controlled territory.
⦁ LAC is different from the Line of Control (LoC) with Pakistan:
⦁ The LoC emerged from the 1948 ceasefire line negotiated by the United Nations (UN) after the Kashmir War.
⦁ It was designated as the LoC in 1972, following the Shimla Agreement between the two countries.
⦁ It is delineated on a map signed by the Director General of Military Operations (DGMO) of both armies and has the international sanctity of a legal agreement.
⦁ The LAC, in contrast, is only a concept – it is not agreed upon by the two countries, neither delineated on a map or demarcated on the ground.
⦁ Length of the LAC: India considers the LAC to be 3,488 km long, while the Chinese consider it to be only around 2,000 km.
⦁ Way Forward:
⦁ Detailed protocols are in place for troops to handle face-off incidents.
⦁ The countries need to stick to the 2005 protocol and the 2013 Border Defence Cooperation Agreement.
⦁ On 1st April, 2020, India and China completed their 70 years of diplomatic relations.
⦁ Both sides should acknowledge that the situation is precarious, and that the recent days in particular have undone decades of painstakingly negotiated confidence-building mechanisms.
⦁ For India, the first priority has to be to restore the status quo ante at the border as it existed in April.
⦁ This will require both a display of military strength at the border by standing up to Chinese aggression, and diplomatic work by making it clear to China that its intervention will lead to heavy costs across all spheres of the relationship.
⦁ India cannot afford to sever all its economic links with the world’s second-largest economy, even in the digital space.
⦁ Chinese finance will help in sustaining India’s start-up economy.
⦁ However, through Atmanirbhar Bharat Abhiyan, India can try to replace chinese products with domestic products in the sectors where it is possible. Further, it needs to boost up its economic relations with other countries.