India-China Reset? Trump, Modi, Quad & the New World Order | ORF Podcast

0:03 I think the the challenge seems to be for the rest of the world is how do you continue to plate Mr. Trump American presidency the most powerful office in in in the world today is is left uh to validate itself moving on to India China what is the progress really how do you see this on on China's part that is that is relatively unclear because we also saw during pahelgam how China and Pakistan worked closely together it's a very critical moment in this group's uh evolution too and especially after Donald Trump's coming back to power. India certainly will will have to put out an agenda which is uh actionable in the short term but it also provides enough legs to this platform to sustain

0:50 itself over the long term. Two very important countries India and China an unless they are in a good working relationship. What does bricks really achieve? [Music] Hello and welcome to the ideas factory. Yet again, the world witnessed a little more of Trump's transactional diplomacy and felt the Trump effect from EU to India all the way to Thailand and Cambodia. He once again boasts of using trade to settle wars. Yet again, he brought up the IndiaPakistan ceasefire. This time speaking about the situation between Thailand and Cambodia and mentioned how he used trade to settle the conflict between India and Pakistan and will do so in Thailand and Cambodia. On the other side of the globe, after high-stake negotiations with EU president, US and EU have reached a deal

1:35 just days before the deadline and Donald Trump declared that this was a very big deal, biggest of all. So let's look at the Trump effect across the world. Also on the other side, other than that on the ideas factory, Pia Modi's recent visits much talked about politically for the cost to the excheer. But what were India's gains? Finance Minister has signaled a potential thorn in India China business relations and China claims that a breakthrough has been achieved in the border areas. Dispute um between India and China though continue on many front it is China so cautious optimism prevails. Will India China relations normalize? So joining me to discuss these questions uh is professor Harsh Pant on the ideas factory. A very warm welcome to you and um you know this

2:22 morning u uh since last night we've been hearing of this highstake negotiation in Scotland's Sternbury with European Union European Commission President Ursula Wonderland and Trump and the two leaders have revealed a new trade framework you know that which is aimed at averting a full-blown transatlantic trade war. So if the talks had collapsed then Brussels was also ready with counter measures but right now also we are hearing conflicting views from EU and US. So where does this trade deal stand and how important it is right now for EU, US and the world? Uh I think uh as two of the major uh economic players in the world, Nagma, this is certainly a very important moment for both of them. uh and we are what we are now looking at is uh the the

3:10 Trump administration concluding a number of these agreements with a number of their u partner countries and um you know uh we saw just in the last few weeks he has announced uh with with Japan and then now with with the EU as well. Uh I think um uh the the challenge seems to be for the rest of the world is how do you uh continue to pleate Mr. Trump and how do you continue to assure a certain degree of predictability uh in a relationship a and with an administration that is um increasingly volatile and and has made no bones about being volatile and and being and using that unpredictability and volatility as a tool in as as a negotiating strategy. And I think it seems to be paying off uh

3:57 for for Mr. Trump at least in the short term because if you see the kind of uh agreements that he has signed including with the EU uh there are significant gains uh for uh for their for the US and I think uh though uh the Brussels is also claiming that this is a win-win situation it seems on the face of it uh certainly that uh uh Mr. Trump has had a better you know terms of trade on on paper but the but I think the issue uh for other countries um when they are dealing with Mr. Trump is that trade becomes one aspect of a broader relationship. When you're looking at um

4:42 uh Japan or you're looking at EU, these are partner countries of the US who want a stable political and a strategic relationship with the US. So certainly for them trade uh is important but it has to be part of a larger bookie of issues. So when you hear for example European Union um saying that look or Trump saying rather that oh they have agreed to buy energy they have you know they have agreed to to open certain markets that that were not open before it is a signal that uh uh the the America's partners are willing to uh go a certain distance to ensure that a certain degree of predictability comes in their engagement with the US otherwise it's it's a very difficult environment for everyone so I do think

5:28 that on paper as of now Trump's strategy of being of using tariffs as a negotiating tool seems to be paying off and and therefore other other countries are adjusting and of course we wait and watch for the India U uh India US agreement of course and um you know when we talk about these tariffs as a tool for negotiation this transactional diplomacy that Trump has been boasting of that he's doing that again with Thailand and Cambodia and he's once again in spite of India's rejections multiple times said that he use this as a tool between the India Pakistan conflict and he's going to use this or has this has probably worked in Thailand and Cambodia. So we see that happening there as well and no wonder Mr. Trump is very encouraged by this. Yes, I I uh u you know we we

6:14 really don't know actually what you know what which which negotiating tool he uses because it's not evident uh that Thailand and Cambodia have such great stakes in in in the trading arrangement with with uh with the US that so you know if if uh a country like China or EU or in Japan they talk about it the reality is that these are big economies major economies is dealing with the US. But when you talk of Thailand and Cambodia, it's not clear whether trade is going to be an instrument that is going to change the nature of their political dynamic. But of course, if America is involved as an actor, then I think the two countries Thailand and Cambodia will have to listen and I think that seems to be at at work rather than

6:59 this larger generic argument of of that I'm using trade and therefore settling some of these disputes. I think on the uh on the uh India Pakistan issue of course we know that the narratives are completely different. We know that from New Delhi's perspective a certain um chain of events led to the ceasefire and of course it's uh from India's perspective uh operation Synindur is an ongoing operation which is which has not really ended. So uh you know but there is you know when you have someone like Mr. Trump, there is very little you can do about many of the things that he says or he, you know, or even he does. And you just have to uh, you know, make your peace in some ways with with him. Uh, because it it may not necessarily reflect the ground reality. It may not

7:45 necessarily reflect uh the, you know, the way certain out outcomes come come about, but I think it it reflects his own sense of importance. It reflects his own sense of what he brings to the table. And of course uh the sense that he needs uh that he and and if you if you listen to him carefully he he uses this phrase very often that I don't get enough credit that I do so many things that you know I've done this I've done that but no one gives me any credit. So I think at some point he's also someone who is looking for certain validation and that validation he himself gives gives it to himself. That's interesting the US president looking for validation. Validation. Yes. I mean I've it's it's very rare and I think in some ways that's also the story of of our times that US is not really the preeminent

8:32 power that it used to be and therefore uh American presidency the most powerful office in in in the world today is is left uh to validate itself that look I have done this I have done that and yet this angst that America doesn't get credit for many of the things that that he does so I do think that in you know Um uh most of the countries in fact if you see uh they they are just you know making their peace with with him uh and with his uh with the way he conducts diplomacy and trying to uh contain the damage to the bilateral relationship and move on because that's the best you can do under circumstances by letting letting him say what he says and not really counter it. So not back and forth. I think that that's

9:17 there is no point doing that. So so you move ahead. Let let Mr. Trump say and believe what he wants to even though ground realities could be different. Now moving on to India, China there have been very positive signals that bilateral relations are showing improvement though very cautious because this is remember this is China. So you have to be there is a cautious optimism. U you know also economic ties are going to normalize, political ties probably are going to normalize. What is the progress really? How do you see this? I think the progress uh seems to have been um uh significant as if you if we look at what is publicly uh available uh and I think the fact that um uh we are now looking at multiple

10:06 senior level engagements and probably prime minister Modi visiting for the SEO summit to China. Uh I think there is a there's a the change in atmospherics is quite evident. Uh the change is also evident in terms of the uh what is happening at the people-to-people level. Uh we have seen visas issue being sorted. We have seen Kalash Mansuratra issue you know being now back uh in the fray. We have we are looking at um u in some ways the two countries again I think there is a link here with Mr. Trump that in in in the day and age of Mr. Trump, most countries are reccalibrating their their ties with

10:53 other other nations and it's it's pretty evident that uh India and China with two of the major global economies will have to recalibrate. we'll have to uh reassess but I would point out that you know it it started the process started if you recall last October when we had the border agreement and I think India's point throughout since 2020 if you go back to 2020 Galwan crisis uh it was always that China unilaterally altered the status quo along the border so it is China's responsibility to ensure that uh we move away from the brink And once I think last year when China did decide to move away from uh to to take back its positions we could move on I think with

11:40 with a wider set of relationship and I think that's uh that was always uh what India India had maintained that we will move ahead with other aspects only when the border issue is back to status quo anti situation and I think once that happened you you have seen movement uh in India's position on on economic matters and uh and others and and and I think uh at a time when global economy is not doing very well um two major two uh major economic powers have to recalibrate in some ways and and if you recall I think just uh recently uh Indian finance minister said that we are moving forward with China but of course we have to be cautious in in in uh in how we deal with China because uh the past experience have has not been uh

12:27 very good. Yes. And China has also claimed progress as far as border disputes concern border is concerned. I you know there has certainly been um um a move back from the brink on the border. Uh whether this leads to a broader reassessment uh of on on China's part that is that is relatively unclear because we also saw during pahelgam how China and Pakistan worked closely together. Since then we have seen how platforms like SEO for example have been instrumentalized by China. So therefore uh when SEO defense ministers meet happened we did not sign the joint statement. So, so there is clearly a tension in the relationship politically, economically, diplomatically, we are

13:14 moving forward but I think the strategic framework of the relationship is still in a limbo and I think that's where the challenges will continue because that strategic framework from India's point of view it's very clear but from China's point of view it's so when you see the two hostile neighbors Bangladesh and Pakistan and the triangle that's formed there with China's assistance and like you mentioned that India and China need to recalibrate ate their equations and economic relations looking at the current scenario but the American factor comes into play and when we talk of SEO the prime minister will probably go there uh the foreign minister's meet was attended by our foreign minister but you know India is also compelled to abide by certain US dictats and um also you know US's position here of curtailing China

14:00 and its economic growth so how does India the challenge to balance that the relation between US and China you see that even during the upcoming SEO that would be a concern that India will have to balance quad and SEO. I think it it would be and I and I uh and uh and I think in some ways India will have to start thinking more strategically about these platform because if you if you as I was mentioning if you look at China's approach to these platforms Chinese uh u are not woolly about any of these platforms they use them for their strategic agenda right that's why you see coordination with Pakistan at the uh so I think uh to what extent uh India

14:46 India for example uh would engage with quad or would engage with bricks or would engage with SEO in framing a larger strategic response to China that's that's an essential question for India uh going forward I think the chi the the the US issue becomes slightly less complicated at this point because um u President Trump himself is making an outreach to China so there is a apparently he's also there are talks of his visit possible will visit to China. So therefore uh you know we we may see uh a China US reset in the in the coming months and that would in some ways put uh India I think there will be lesser pressure on India to to frame its response to China.

15:34 So I I I do think that um uh that wider Indoacific issues, wider strategic issues, the issues of as you mentioned China's role in South Asia and Indian Ocean region will continue to compl complicate the relationship because it is in in a sense a relationship where competition is inherent. We cannot do away with that. But the question is whether we are building enough deterrence in our relationship so that we can use a deterrence framework to build the economic tie so that we have we are preventing China from using military as an instrumentality uh visa v India visa vas and therefore create other avenues other aspects of leverage and I think that's essentially a question India will have to move forward because India cannot afford to ignore uh

16:21 the capacity problem which which which India faces visav China. So as you build your national capacity here at home, you have to continue to engage with China to ensure that the negative externalities of this relationship do not impinge on this very important bilateral course and when you talk of SEO and we and talk of Quad, we know that India is set to host the Quad leader summit. Uh it's a very critical moment in this group's uh evolution too and especially after Donald Trump's coming back to power or reelection because he there's a renewed era of transactional diplomacy and he doesn't seem to believe too much in multilateralism. So Quad's future you know is in question uh because the entire emphasis is on national self-interest and uh even the defense minister although defense minister has

17:08 reiterated during the Shangrila dialogue how America's here to stay and you know they have keen interest in the Indopacific but Marco Rubio did say earlier that it's all about us you know like me first kind of an attitude so looking at those statements and Mr. Trump himself uh the court's future and evolution at this moment also India hosting the quad summit I think um the long-term future of Quad or or the regional configurations emerging in the Indoacific that's not in doubt the challenge is how do you navigate Mr. Trump and his uh eccentricities over the next three years because uh the the strategic realities

17:54 the the strategic competition between US and China the strategic competition between India and China the Indo-Pacific landscape that is a given I don't think uh you know uh these are structural realities with us that will continue to be with us but the but the question will be whether u we whether we effectively navigate the next few years as we build long-term sustenance capability as we build institutional architectures as we build certain standards and norms to manage a very very difficult uh strategic environment and I think quad uh might face some challenges because uh as you mentioned um u

18:39 Mr. Trump and uh his team uh is not particularly interested in uh in looking at grand multilateral outcomes. Uh they are interested in bilateral outcomes. They are interested in uh certain very transactional outcomes for them and for their political base at home. How do we manage that? How do we manage that turbulence? Uh will in in some ways dictate uh what happens to the quad. But I think as is as as you know the quad as the host of the quad leader summit uh India certainly will will have to put out an agenda which is uh actionable in the short term but which also provides enough legs to this platform to sustain itself over the long term. So I don't think long-term sustainability is in

19:24 doubt. What is a challenge is what do you do in the short to medium term? Of course. And another organization u we talk about multilateral organizations is BRICS and Prime Minister Modi traveled to Brazil to attend uh the BRIRC summit. Uh you know BRICS has grown in its popularity. More countries are joining and showing interest in joining. But at this moment again uh what did India really gain? uh because you know a lot of questions about two very important countries India and China unless they are in a good working relationship what does brrics really achieve u so if we look back at what happened and what did India gain at the bricks summit u what what is your analysis on that I would say that um bricks certainly this time allowed India to um and and

20:10 and this was around Mr. Modi's uh you know visit to um not only BRICS but then to Argentina as well uh I think it allowed India to to rethink its Latin American South America engagement uh and India Brazil relationship I think also got a boost from this relationship. So again I would I I think well where whereas as a platform and this time of course both Xiinping and Vladimir Putin were missing from the from the summit there in Brazil but the the the reality of bricks being as a as as as as a platform that can amplify the voice of the global south. I think that is something that perhaps India gains by by continuing to be a member of bricks and therefore and

20:56 that's also the reason why you are seeing such an interest in bricks uh from a large part of the world where lots of countries want to join bricks. So as bricks becomes bricks plus+ uh that the challenge would be whether the original intent behind bricks which was to challenge the uh global economic order as it as it has ex existed since 1945 to give greater voice to emerging economies in in global economic architecture. I think those questions remain very relevant if India can use that platform towards that and that would be I think like you correctly mentioned that uh Prime Minister Modi also traveled to Argentina and a couple of other countries to Nidad Tobago and you know renewed uh kind of the relationship with the global south. Uh but when we come back to bricks and we look at how

21:42 President Donald Trump threatened again sanctions talking about the bricks economy the bricks currency u in that case you know that that threat may be real unreal he always has a habit of using it as a negotiating tool which is why the question of how relevant bricks is as an you know emerging e economic block with those threats of sanctions. See every member of the bricks if you if you look at it carefully in in especially the big countries they are having a separate bilateral engagement with the US. You have China trying to negotiate a trade deal. You have Russia trying to pleate Mr. Mr. Trump because they had they are looking at a security architecture in Europe blessed by the US in to a certain extent in their favor.

22:28 Uh and and so it's it's a very uh complicated uh environment for bricks at this point. So as a cohesive unit I don't think bricks was ever a politically cohesive or platform. What gave it resonance was this idea that here are these economies that that are asking for greater representation for emerging economies uh in in the global financial and economic architecture. I think as we move towards an expansion of bricks, bricks seems to be becoming a platform which can amplify the voice of the global south rather than uh you know uh looking at bricks as a platform which will be which will ever be geopolitically cohesive especially at this point in time when every country and and you know we started with that uh that if you look at major major trade

23:15 deals that that America is now signing um you know and and um and de and Mr. Mr. Trump is celebrating those those trade deals every day. I think it is a reflection of the times that we live in that countries are looking beyond these uh platforms to bilateral engagements with the US and that's what in some ways gives us uh enough currency uh in in in in global politics. you know this is it still retains its relevance as a central player whether or not uh it will u you know going forward uh whether or not it sustains itself whether or not the present world order as we know it is evolving in a in a certain direction where other powers are rising whether or not US can retain that centrality that's the essential question I think everyone

24:02 is asking beyond Trump Trump of course uh has to be placated but beyond Mr. Trump, what is the future of American power and purpose? I think on that question hangs a lot of the global order questions. Absolutely. Especially like you mentioned, these are the times we live in where there is a sharper emphasis on national self-interest and skepticism about, you know, those multilateral cooperations and organizations. So on that note, we will stop here at on this episode. Thank you so much for joining us on the ideas factory. [Music]