For UPSC CSE aspirants, analyzing editorials from The Indian Express is essential to build a comprehensive understanding of current affairs, policy debates, and socio-economic challenges. Here’s a structured breakdown of the editorial themes covered on January 30, 2025, tailored for UPSC preparation:
1. India and China need each other. But will the detente last?
India and China are engaging in renewed diplomatic interactions, moving towards a post-Galwan “normal” relationship. However, historical tensions, border disputes, and geopolitical competition remain unresolved. The present détente is driven by economic, military, and political factors, but its longevity remains uncertain.
Drivers of the India-China Détente
1. Economic Interdependence
- India’s economy is growing at 7% per annum, but it relies on Chinese imports for sectors like pharmaceuticals, electronics, and infrastructure.
- China’s economy is slowing to 5% per annum and faces Western protectionism, making India a crucial market for diversification.
- Mutual economic dependency incentivizes cooperation despite political frictions.
2. Military Stalemate
- Post-Galwan, both countries have heavily fortified the border, leading to prolonged troop deployments in extreme conditions.
- Neither side can achieve an outright victory, making continued conflict costly and unsustainable.
- China faces military challenges in East Asia (Taiwan, Senkaku, South China Sea), while India contends with Pakistan and potential two-front wars.
- Managing resources wisely necessitates diplomatic engagement to avoid unnecessary escalation.
3. Political and Strategic Calculations
- Both India and China seek to balance their relations with the US:
- India’s concerns: US stance on immigration, trade, Pakistan, Bangladesh, Sikh separatist activities.
- China’s concerns: US weaponization of trade, technology sanctions, and human rights criticism (Tibet, Xinjiang).
- A tactical rapprochement allows India and China to enhance their bargaining power with Washington.
Challenges to Long-term Stability
1. Historical and Territorial Disputes
- Recurring border standoffs (Depsang 2013, Chumar 2014, Doklam 2017, Galwan 2020, Yangtse 2022) indicate deep-seated strategic mistrust.
- Land and water disputes are tied to sovereignty and national identity, making resolution difficult.
- Both nations have a historical sense of victimhood, complicating compromise.
2. Nationalism and Domestic Politics
- Both Modi and Xi face internal political pressures to project strength in foreign policy.
- Any perceived concession on border issues could be politically costly, limiting room for flexibility.
3. US-China-India Geopolitical Triangle
- If US-China tensions escalate, India may face renewed pressure to align with Washington, straining India-China engagement.
- The QUAD alliance (India, US, Japan, Australia) and China’s deepening ties with Pakistan could further strain relations.
Conclusion: Can the Détente Last?
- The current thaw in relations is structurally driven by economic needs, military realities, and geopolitical calculations.
- Short-term normalization is likely, but long-term peace remains uncertain due to unresolved territorial disputes, nationalism, and global strategic shifts.
- While Modi and Xi could negotiate a strategic bargain, neither seems in a hurry to do so.
- Cautious engagement with pragmatic diplomacy is the best way forward for both nations.
2. Critics don’t get it — free trade is good for India
India’s approach to free trade has been met with skepticism, with critics arguing that trade agreements expose the country to economic vulnerabilities. However, data suggests that India has successfully leveraged Free Trade Agreements (FTAs) to boost exports and strengthen manufacturing. The notion that India is merely a dumping ground for foreign goods is misleading, as it maintains a surplus in finished goods trade with several FTA partners, including ASEAN nations.
The Role of Free Trade in India’s Economic Strategy
1. Free Trade and Global Value Chains (GVCs)
- Integration into GVCs is crucial for economic expansion, as seen in the growth trajectories of China and Southeast Asia.
- India’s high tariff structure hinders participation in GVCs, affecting both exports and foreign direct investment (FDI).
- The frequent changes in customs duties create uncertainty, discouraging long-term investment in manufacturing.
2. India’s Experience with FTAs
- Contrary to the protectionist argument, India has a surplus in finished goods trade with many FTA partners.
- Example: India’s exports to ASEAN grew from $5 billion in 2003 to over $40 billion in 2022-23, with finished goods exports increasing tenfold.
- The perception that FTAs lead to one-sided benefits is not backed by data.
3. India’s Trade Policy and the Union Budget
- While the Union Budget is not primarily a trade policy document, it often reflects India’s approach to trade.
- High tariffs and policy instability hurt export competitiveness, as seen in the mobile phone industry, where fluctuating duties disrupted supply chains.
- A structured and predictable trade policy is essential to achieve India’s ambitious $2 trillion export target by 2030.
India and Mega Trade Agreements: RCEP vs. CPTPP
1. RCEP: A Risky Proposition?
- RCEP, dominated by China, could widen India’s trade deficit due to increased imports.
- While it could facilitate trade in intermediate goods, the potential gains are outweighed by the risks of excessive dependence on Chinese imports.
2. CPTPP: A Strategic Opportunity
- CPTPP excludes China, offering India a better negotiating environment.
- Potential benefits include increased exports to Mexico, Canada, and Australia.
- The agreement’s focus on quality standards and intellectual property aligns with India’s long-term economic goals.
Conclusion: Reassessing India’s Trade Strategy
- Trade protectionism is not the answer to India’s economic ambitions.
- FTAs have positively contributed to India’s export growth, particularly in finished goods.
- India should consider CPTPP as a viable trade bloc while remaining cautious about RCEP.
- Trade openness, combined with structural domestic reforms, will unlock India’s true economic potential.
3. For Nirmala Sitharaman, a wishlist from the armed forces
India’s defence budget has been witnessing a steady decline as a percentage of GDP and government expenditure, raising concerns about military modernisation. The imbalance between capital expenditure and personnel costs further limits the armed forces’ ability to acquire advanced weaponry. Addressing these challenges is crucial for strengthening national security and achieving self-reliance in defence manufacturing.
Key Takeaways:
1. Declining Defence Budget Allocation
- Defence spending has steadily decreased as a percentage of central government expenditure from 13.81% in 2020-21 to below 13% in 2024-25.
- As a percentage of GDP, it has declined from 2.4% (2020-21) to 1.9% (2024-25), falling below NATO’s recommended 2% benchmark.
- IMF and World Bank consider up to 3% of GDP for defence spending as acceptable.
2. Capital Expenditure (Capex) and Modernisation Challenges
- Capex for the armed forces has increased by ₹40,000 crore in the last four years, reaching ₹1,72,000 crore in 2024-25, but remains inadequate for India’s ambitious Atmanirbharta (self-reliance) programme.
- Distribution of capital budget among services:
- Indian Army (84% of personnel) gets 22-28% of capex, limiting funds for essential weaponry (artillery, helicopters, protective gear).
- Indian Navy (5.5% of personnel) receives 31-36% but lacks warships and submarines to safeguard India’s 7,500 km coastline and EEZ.
- Indian Air Force (10.5% of personnel) gets the largest share (38-45%) due to expensive aircraft procurement (e.g., 36 Rafale jets for $8.7 billion).
3. Personnel vs. Capital Expenditure Imbalance
- 57% of defence budget is spent on salaries, pensions, and civil organisations under MoD.
- Only 27.7% allocated for modernisation, whereas global standards suggest 50-60% for capital outlay.
- High costs of domestic production (e.g., Sukhoi-30MKI made in India is ₹100 crore costlier than imported version).
4. Issues in Budget Accounting and Transparency
- Confusing classification of expenditures:
- Border Roads Development Board (BRDB) and Jammu & Kashmir Light Infantry (JAK LI) are listed under MoD (Civil) instead of Army.
- Coast Guard budget is not placed under the Navy.
- Lack of separate accounting heads for Army, Navy, and Air Force in capital budget makes tracking allocations difficult.
5. Need for Strategic Defence Spending
- India lags in high-tech R&D funding for the military.
- Modern militaries prioritize capital investments for a technological edge over adversaries.
- Despite a ₹11,11,111 crore capital expenditure commitment in last year’s budget, defence gets limited share due to competing priorities.
4. Manoj Jha writes: UGC is diminishing universities
Disclaimer:
This analysis is based on the editorial content published in Indian Express and is intended solely for informational and educational purposes. The views, opinions, and interpretations expressed herein are those of the author of original article. Readers are encouraged to refer to the original article for complete context and to exercise their own judgment while interpreting the analysis. The analysis does not constitute professional advice or endorsement of any political, economic, or social perspective.
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