By Mohammad Mazhari
TEHRAN - Editor of Delhi's Hardnews magazine says that the Iran-China partnership is a game-changer as it ends U.S. ability to pressure Iran.
“Iran-China 25-year partnership accord can be a game-changer. It will end Iran’s dependence on Western products and the U.S.’s ability to withdraw its easy access to the international financial order,” Sanjay Kapoor tells the Tehran Times.
“Iran-China partnership fixes many issues. It gives energy security to China. It provides an assured market to Iranian petroleum products,” Kapoor notes.
Financial pundits believe that China is a great opportunity for Asian countries in general and its neighboring countries in particular as it can provide an option to many countries to follow a development model different from the West.
Countries Like Iran and Pakistan can rely on China to boost and reconstruct their infrastructure.
“When Iran’s financial troubles end, it will rediscover itself as a civilizational power it is and enlarge its influence in Central Asia and other parts of the world,” Kapoor remarks.
Following is the text of the interview:
Q: How do China's neighbors see Beijing's economic rise? How could China reach such a level of development?
A: I have traveled all along with the countries that share their border with China. All of them have concerns that the highly populous China would change the demographic profile of these border towns. By way of example, I went to Myanmar some years ago and I learned how and why cities like Mandalay have such a large Chinese presence. I learned that behind every instance of Chinese geographical intrusion, their government or the authorities are involved and that is why they (Chinese) enjoy overwhelming influence compared to local businesses. Inexpensive Chinese manufactured goods also affect local businesses. So, China’s rise is seen with awe, fear and with deep resentment. It also leads to the weakening of the local governments that can’t save local jobs and businesses.
How could China reach such levels of development? At the time when the communists came to power in China, they followed an economic and social ideology that was premised on curbing domestic consumption, increasing savings, which resulted in capital formation that helped in turning China into the factory of the world. China benefited from its relationship with the U.S. that leveraged it to diminish the Soviet Union. It’s a long story, but China’s authoritarianism that led to the curbing of democratic rights of the people and fierce nationalism also helped it to attain new heights. Subsequently, the belt and road initiative (BRI) also allowed to enlarge its global footprint.
Q: What opportunities can China provide for Asian countries?
A: The rise of China represents big opportunities for its neighbors. This was evidenced during the Asian meltdown in 1997-98. China gave a billion dollars to Thailand to stabilize its economy and also provided assistance to other countries in its neighborhood when they were struggling with their dwindling foreign exchange reserves. That period of crisis allowed China to invest in many businesses in Thailand, Malaysia and the Philippines. China also took advantage of investing opportunities in the U.S., Europe whenever their economies went through a slowdown. For instance, the period of a global slowdown in 2008 was God sent for China that became truly a world power.
Q: How do you evaluate U.S. -China trade row? Is the U.S. capable to contain China?
A: The U.S. is undoubtedly a world hegemon. Our reservations about their violent foreign policy should not cloud our judgment about their success in the field of technology, manufacturing. It is a world power far bigger than China and even Beijing’s leadership is cognizant of it. China exports some $500 billion of goods to the United States and there is a big trade imbalance between the two countries. The row, if it is real, has the potential to diversify manufacturing to other countries of the world. India, for instance, is seriously trying to reduce its dependence on Chinese goods or even on bulk drugs (API) that are imported from China. To its credit, China has become very influential due to Belt and Road initiative that allows it to deal with 100 odd countries from where it accesses minerals and their markets.
China does not want to fight with the U.S. The middle kingdom that is China knows that a confrontation with Washington could lead to its ruin. Perhaps Beijing would need another 20 years to become a military power to challenge the U.S. Over the past few years, it has made rapid strides in software, surveillance technology, drone technology. It has a navy that can challenge the U.S., but there are still many gaps. Even the Chinese believe, rightly so, that it is a developing country.
Q: Do you think China can lead the global economy in near future? Don’t you expect emerging Asian powers, like India and Turkey, to form a coalition with China?
A: The rise of China is a great event of sorts. It provides an option to many countries to opt for a development path distinct from that led by IMF-WB. Africa, Asia and parts of Latin America have been beneficiaries of China, which would have languished in deep misery after the 2008 global meltdown if China had not come to their rescue. Chinese support is not altruism as it has benefited from the mineral wealth of many of these countries and managed to push its wide range of manufactured goods to them. The only problem is that China does not represent western values like democracy, free speech, etc., which feed authoritarian tendencies in the rulers of these countries.
Do I expect India and Turkey to form a coalition with China? I don’t think this coalition is happening anytime soon. Though India is bound with China through many multilateral groups and agreements, it perceives it as a competitor. Its relationship has strained further after it opposed the BRI and more recently when it had a border skirmish with China in which 25 of its soldiers died. Now about 200,000 troops of both sides face each other. After India joined the Quad, which is heading towards increased militarization, the possibility of the two countries making up so soon looks difficult. Having said that the leaders of both countries are very careful in ensuring that the situation does not get out of control. Russia is also mediating between the two countries and despite the amassing of troops, there is hope that there is no war. At the moment when we are talking with you, the situation is very tenuous aggravated by the hostility that the U.S. is displaying towards China. Unwillingly, India is backing U.S. and Quad.
Turkey is also a civilization power, which is bound by its membership in NATO. It is unlikely we will see Turkey form a coalition with China. Though their trade ties will soar.
Q: How do you assess the 25-year Iran-China partnership accord? Can it curb the U.S. sanctions?
A: 25-year Iran-China partnership accord can be a game-changer. It will end Iran’s dependence on Western products and the U.S.’s ability to withdraw its easy access to the international financial order. We have seen Iran suffer as it struggled to transfer or receive foreign funds. India’s own investment in Chabahar suffered due to that. Iran-China partnership fixes many issues. It gives energy security to China. It provides an assured market to Iranian petroleum products. When Iran’s financial troubles end, it will rediscover itself as a civilizational power it is and enlarge its influence in Central Asia and other parts of the world. Another important spin-off from the deal with China could be that the Biden administration- in an attempt to wean Iran from China’s embrace- may hasten the completion of the nuclear deal that had been scrapped by U.S. President Donald Trump.
I am extremely excited by the implications of this deal as it would nullify U.S. sanctions and liberate the people of Iran from this scourge.
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