Much as for today’s Russia, digital transformation has been one of the priorities for India’s government, its entrepreneurs and the civil society. Despite the turmoil caused by the pandemic, the changes on the path of digitization taking place in Russia and India open up new opportunities for cooperation between the two countries and pose new problems.
Given that forecasts of India’s economic growth are again—as it happened a year ago—downgraded, and the footage of today’s tragic situation in the country dominates TV screens, it is difficult to believe that a significant part of the positive transformations of recent years in India has to be attributed to the technological progress of the Fourth Industrial Revolution, the expansion of knowledge economy and a rapid digitization. However, this remains the case, and a study published recently by the SKOLKOVO Institute for Emerging Markets Studies in cooperation with the Indian School of Business focuses on the digitization aspect of the profound transformation that extends to the Indian economy and society as a whole.
The research report “India Goes Digital. From a local phenomenon to a global influencer” examines the main distinctive features that, as the authors argue, make India’s digitisation profile unique. They include both fairly well-known aspects, such as the system of biometric identification of citizens operational in India, as well as less familiar features, including a close partnership between the state and private businesses in designing and implementing digitization programmes, their impact on the increasing financial inclusion as well as the boom of entrepreneurship, which is also largely associated with the rapid proliferation of digital technologies in India.
The study also examines the impact of digitization on the education sector, critical to India’s development. It explores the great potential that India’s educational companies have; after all, as of today, they are the fastest growing in their segment on a global scale, seeking international expansion, which makes quality education more accessible and effective for both developing and developed countries.
The study provides insights into the companies, institutions and entrepreneurs that make up the emerging digital India. In the segment of the study concerning Russian-Indian cooperation, the authors analyze the experience of Russian businesses in India and argue that it is necessary to strengthen the technological segment within the strategic partnership between Russia and India, which is not only dictated by the present-day requirements but also has a very significant potential.
The Russian-Indian partnership in the era of digital transformation
In 2020, Russia and India celebrated 20 years since the Declaration on Strategic Partnership was signed in New Delhi by Prime Minister Atal Bihari Vajpayee and President Vladimir Putin in October 2000. In December 2010, the India-Russia partnership was upgraded to the level of a special and privileged strategic partnership. In April 2019, President Putin signed an executive order, awarding Prime Minister N. Modi the Order of St. Andrew the Apostle the First-Called for his distinguished contribution to the privileged strategic partnership between Russia and India and fostering friendly ties between the Russian and Indian peoples. The strategic status of relations is not exclusive for both countries; however, a profound mutual understanding on most of the issues on the contemporary and historical agendas is a unique feature of the Russian-Indian relations. The annual meeting of the leaders of the two countries did not take place in 2020; however, the next face-to-face summit is reportedly planned for 2021. The views of Moscow and New Delhi on the geopolitical situation in the two most important macroregions—Eurasia and the Asia-Pacific—where both Russia and India play an important role and where the two countries seek to smooth out the emerging divergence in approaches to their future deserve a separate analysis.
In April 2021, it was announced that a “two + two” dialogue with the participation of foreign and defense ministers would be established between Russia and India. India is already working with the United States, Japan and Australia in the same format.
In addition to the strong political ties, traditional cooperation in the energy sector, as well as military-technical partnership, is particularly prominent and important for both India and Russia. In September 2019, Prime Minister Narendra Modi was the chief guest at the 5th Eastern Economic Forum in Vladivostok. The Russian Far East, a vast territory designed to become Russia’s new gateway to Asia, is open for Indian business, striving to become one of the new engines for the development of the Russian-Indian ties.
The planned Vladivostok-Chennai maritime corridor will become an important new transport link connecting the Russian Arctic and the Far East with India. In this regard, the energy bridge between the two countries, which implies trade and investment in oil and gas, LNG, nuclear energy, coal mining and processing, will certainly expand, given the natural complementarity of the economies of the two countries. Cooperation in the field of renewable energy, on which India puts a clear premium, and in the hydrogen economy, are also under discussion. The co-production of COVID-19 vaccines is an important recent addition to the list of priority areas for bilateral collaboration.
Besides, Moscow and Delhi intend to expand military-technical cooperation using the advantages of localization within the framework of the “Make in India” and AtmaNirbhar Bharat (“Self-Reliant India”) programmes that are actively promoted by the Indian government and personally by PM N. Modi.
However, for various reasons, as is well-known, economic cooperation between Russia and India lags behind the level of their expanded political partnership. In 2019, Russian-Indian trade turnover amounted to $11.16 billion (while Russian exports to India amounted to $7.24 billion, India’s exports to Russia amounted to $3.92 billion). Before the pandemic, the governments of the two countries set a goal to triple their trade turnover to $30 billion and to increase bilateral investments from $30 to $50 billion by 2025. N. Modi and V. Putin identified the intensification of trade and economic relations as a priority area of bilateral cooperation. The establishment of a free trade zone between India and the Eurasian Economic Union (EAEU) is being considered.
Governments of India and Russia were tasked with identifying and removing the bottlenecks and obstacles to expanding economic ties. Russia’s Ministry of Economic Development and India’s Department of Industrial Policy and Promotion have launched fast-track, single-window mechanisms to facilitate smooth investments by Russian and Indian companies. “Invest India,” an investment promotion and facilitation agency, established a special Russia desk to provide Russian businesses with a convenient platform for support and advice on investment issues. The Far East Investment and Export Agency, the Russian Export Center, Delovaya Rossiya, as well as the Confederation of Indian Industry (CII), the Federation of Indian Chambers of Commerce and Industry (FICCI) and other organizations promote direct contacts between Indian and Russian business communities. Two rounds of strategic economic dialogue took place between India and Russia: in St. Petersburg in 2018 and in New Delhi in 2019.
2020 was the year of Russia’s BRICS chairmanship, and despite the fact that the BRICS summit, like all other work, had to be held remotely, Russia tried to make the content of this work most up-to-date and relevant to today’s requirements. Thus, the topic of cooperation between the BRICS nations in digitalization-related areas was reflected in the 12th BRICS Summit Moscow Declaration adopted at the meeting. In the new Strategy for BRICS Economic Partnership 2025, one of the three main directions identified was—for the first time—cooperation in digital economy. 2021 is the year of India’s chairmanship in BRICS, meaning that the topic of digitalization, which is very close to India, will undoubtedly find further reflection in the work of the grouping. In recent years, India has made tangible progress in promoting Internet penetration, digital literacy, e-government, financial technology, e-commerce and so on.
Digitalization as Russia’s top priority
Digital transformation is now one of the top priorities for Russia as well. This was reflected in the appointment of Mikhail Mishustin as Prime Minister of the country in January 2020. Speaking at the State Duma in 2020, M. Mishustin noted: “Digital is the oil, gold and platinum of the 21st century. If we do not get digital, digital will get us.” Prior to his appointment as Prime Minister, M. Mishustin headed the Federal Tax Service of Russia, where he managed to overhaul the work of this department on a completely new digital foundation and in a rather short time span. Russia has developed the National Technological Initiative (NTI), a long-term programme aimed at ensuring the leadership of Russian companies on new high-tech markets that will emerge in the global economy during the next 15-20 years.
Like India, Russia is now preparing to test and deploy 5G networks. The national “Digital Economy” programme (planned up to the year 2030) is currently under implementation. NTI and Russia’s other efforts in the technological field can be coordinated with the strategic plans of India in similar areas.
Complementarity and new cooperation avenues
So far, India’s experience with digitalization is not well-known in Russia. With some exceptions, Russian businesses are largely unfamiliar with the changes taking place in India. Although Russian and Indian IT-industries have evolved differently, new complementarities and new opportunities for collaboration between them are emerging. It is noteworthy that the Russian Association of Software Development Companies RUSSOFT, founded in 1999, was created following the example of the Indian National Association of Software and Service Companies (NASSCOM). Today, companies, such as MaximaTelecom (solutions for digital cities and businesses), Lighting Technologies (lighting systems for smart cities), Technonicol (advanced building materials), Zyfra (artificial intelligence and industrial solutions based on the Internet of Things), Tactise Group (advanced solutions in the field of labour protection and industrial safety), as well as state giants such as Rosatom (India’s key partner in the nuclear industry), are actively involved in India’s innovative development path.
However, there exists great potential for expanding this list. Despite severe competition with both Indian and international players, solutions from Russia are in demand, Indian businesses and the national government are willing to work with Russian companies in their own interests, regardless of possible pressure from the outside. Several investment funds are also working with India, building bridges and striving to blend Russian, Indian and international experience. These include Sistema Asia Capital, RTP Global, DST Global. These are experienced tech-savvy investors, representing “smart money”, equipped with the knowledge of working with complex markets, such as India.
The two countries have the potential for cooperation in deep technologies, such as artificial intelligence, big data and analytics, machine learning, smart energy infrastructure, smart logistics, photonics and new materials, microelectronics and semiconductors, as well as blockchain and financial technologies. An important element of support from the governments on both sides could be the establishment of so-called regulatory sandboxes—so that experimental legal regimes could facilitate cross-pollination and testing of ideas between technology companies and start-ups from India and Russia.
Amid today’s realities, India cannot be solely viewed as a potential sales market. It is necessary to work with India as a valuable partner. India welcomes foreign businesses that help address its challenges without aggravating the country’s problems (in particular, unemployment and environmental degradation). India offers incentives to localize production and has unique experience in scaling low-margin products and services. Importantly, Indian businesses are going global very actively and can serve as a springboard for Russian solutions to enter international markets.
Another potentially important area of cooperation between India and Russia is cybersecurity. In the rapidly unfolding digital world, the environment where people and businesses operate is becoming increasingly permeable, while the space that needs protection is more and more difficult to delineate with a security perimeter. Securing critical infrastructure will require new approaches and principles that may be based on quantum technologies and quantum cryptography. Currently, a national cybersecurity strategy is under development in India, and the country is facing regular cyber-attacks on its infrastructure, which Indian regulators, knowing the complexity and ambiguity of this topic, rightly avoid attributing to any specific groups of cybercriminals or naming their origins. At the same time, India’s Western partners rush to attribute these attacks to China or North Korea.
Against the backdrop of the global pandemic crisis, the dangers associated with high technology seem to have receded into the background. However, there is no doubt that the pandemic has significantly accelerated digitalization; and in the new digital world, national independence and sovereignty of countries are becoming more dependent on technology than ever before.
Over the years, Russia has consistently advocated for a broad international consensus under the auspices of the UN to work out the principles of international law to govern cyberspace. Meanwhile, in response to growing digital threats and in the absence of comprehensive international regulation, cyberspace is becoming increasingly regional. In a newly evolving international environment, there are likely to be several technology clusters, each with their own security principles. It is in the interests of both Russia and India to agree on these principles at an early stage, so as not to find themselves on different technological continents in the near future.
Given the constant and consistent striving of both countries for sovereignty and adherence to international law and the principles of non-interference in the internal affairs of other countries, Russia and India are natural partners in the formation of a new digital world, and if their efforts are intensified, this will stand to benefit not only the two countries but also the international community as a whole.
In line with global trends and reflecting the accelerating technological transformation within India, the Indian Ministry of External Affairs announced in 2020 the creation of the New and Emerging Strategic Technologies (NEST) department that will deal with technology diplomacy, foreign policy and international legal aspects of the new technologies. This is expected to enable India to become more involved in the global debate on technology governance and to better advocate for the country’s national interests in this context.
From our partner RIAC
Science & Technology
How the humble neutron can help solve some of the universe’s deepest mysteries
Scientists are unleashing the power of neutrons to improve understanding of everyday materials and tackle fundamental questions in physics.
By MICHAEL ALLEN
Apart from flashbacks that the hit Netflix series Breaking Bad may have conjured up, most of us have likely happily forgotten what we learned in chemistry classes back in school.
So here’s a quick brush-up: chemistry looks at the building blocks of our physical world, such as atoms, and the changes they undergo. An atom consists of a nucleus of protons and neutrons surrounded by a cloud of electrons.
Free the neutrons
Now for something high school chemistry might not have taught us: the humble neutron, found in the nucleus of every atom but hydrogen, can – if manipulated in just the right way – shed light on everything from the climate crisis and energy, to health and quantum computing.
One such way is a rather spectacular process known as spallation, high-energy particles destabilise an atom’s nucleus, which in turn releases some of the neutrons found there.
When harnessed, these newly freed neutrons can be used like X-rays to map the inner structure of materials.
Currently under construction in Lund, Sweden, the European Spallation Source (ESS) is expected to come online in 2027. Once it achieves its full specifications, its unprecedented flux and spectral range is set to make it the most powerful and versatile neutron source for science in the world.
The purpose of the facility, said Jimmy Binderup Andersen, head of innovation and industry at the ESS, ‘is to create neutrons, a neutron beam, to be used for scientific purposes.’
Once the facility is up and running, scientists from across Europe and the rest of the world will be able to use its 15 different beamlines to conduct fundamental research.
According to Andersen, a neutron beam ‘is not the same as an X-ray, but it is complementary and uses some of the same physical laws.’
Like X-rays, neutrons can be used to probe materials and biological systems. But they interact with materials in different ways to the photons in high-energy X-ray beams, and therefore provide different types of information about their targets.
For example, neutron beams can say something about the interior dynamics of lithium-ion batteries, reveal obscured details from ancient artefacts or clarify the mechanisms of antibiotic resistance in bacteria. They can also be used to explore fundamental physics. It almost seems like a case of ‘what can’t they do?’
As part of the EU-funded BrightnESS-2 project partly coordinated by Andersen, technologies developed for the ESS were shared with industry in Europe, to benefit society at large. For instance, some of the power systems developed for the ESS beamlines could be useful for renewable energy technologies, like wind turbines.
Recently, the ESS was contacted by a European semiconductor manufacturer interested in the radiation fields the neutron source can generate. The world we live in is constantly bombarded with neutrons, produced when high-energy particles from outer space, such as cosmic rays from the sun, collide with Earth’s atmosphere. Over time, this exposure can damage electrical components.
The ESS can mimic this neutron bombardment, but on a much faster time scale, enabling it to be used to test the durability of critical electrical components, such as those used in airplanes, wind turbines and spacecraft.
Now ESS is teaming up with other research institutes and companies to find a possible future use of a facility like ESS to address such specific industry needs.
Although the ESS is still being built, scientists are already working on an upgrade to the facility.
When the ESS first opens it will have one moderator, but the EU-funded HighNESS project is developing a second moderator system. The moderators will slow down the neutrons generated during the spallation process, to an energy level that the scientific instruments can use.
‘The neutron energy really matters in a neutron facility, because depending on the neutron energy, you can do different kinds of physics,’ said Valentina Santoro, coordinator of the HighNESS project.
While the first moderator will provide high-brightness, which is a very focused beam of neutrons, the source being developed by the HighNESS project will deliver a high intensity, in other words, a large number of neutrons.
The two moderators will allow scientists to explore different aspects of the dynamics and structure of materials such as polymers, biomolecules, liquid metals and batteries.
A fundamental mystery
The second moderator will also enable explorations of fundamental physics to try and see a neutron become an antineutron for the first time.
‘This is very interesting, because you observe a phenomenon where matter becomes antimatter,’ said Santoro, who is a particle physicist based at the ESS. ‘If you observe something like that you can understand one of the biggest unsolved mysteries: Why there is more matter than antimatter in the universe.’
This experiment can only be done at ESS, Santoro said, because it requires a huge number of neutrons and the ESS will have the highest number in the world.
‘You just need one neutron that becomes an antineutron, and that is it, you’ve found this process where matter becomes antimatter,’ Santoro said.
Research in this article was funded by the EU. This article was originally published in Horizon, the EU Research and Innovation Magazine.
Science & Technology
The Power of Empathy: Building Connections in the Digital World
In our increasingly interconnected digital world, where communication often takes place through screens and devices, fostering genuine connections can sometimes feel challenging. However, amidst this vast virtual landscape, empathy stands out as a powerful force that transcends physical barriers and brings people closer together. By cultivating empathy, we can bridge the emotional gaps that technology creates, leading to deeper understanding, meaningful relationships, and a more compassionate online community.
Empathy enables us to empathize with individuals from diverse backgrounds, cultures, and experiences. In the digital realm, where physical distance separates us, empathy becomes an essential tool for bridging the gaps that exist between people. By actively seeking to understand others’ perspectives, we can transcend geographical boundaries and forge connections that might otherwise seem improbable. Empathy helps break down stereotypes, dispel prejudices, and promote inclusivity, fostering a sense of unity in the digital world.In the absence of face-to-face interaction, it’s easy for misunderstandings and misinterpretations to arise. Empathy helps mitigate these issues by encouraging active listening and validation. When we approach online conversations with empathy, we strive to understand not just the words being said, but also the emotions, intentions, and underlying context behind them. By acknowledging and validating others’ feelings, we create a safe and supportive space where open dialogue can flourish, promoting a culture of respect and understanding in the digital sphere.The digital world offers platforms for people to express their thoughts, share their experiences, and seek support. Empathy plays a crucial role in providing emotional support to those in need. By demonstrating compassion and empathy in our online interactions, we can make a significant difference in someone’s well-being. A kind word, a virtual hug, or a heartfelt comment can uplift spirits, validate emotions, and remind individuals that they are not alone. Through empathy, we create a network of support that transcends physical barriers, promoting mental health and resilience in the digital realm.Conflict is inevitable, even in the virtual space. However, empathy acts as a powerful tool for conflict resolution and trust-building. By empathizing with others’ perspectives, we can de-escalate tense situations, promote understanding, and find common ground. Empathy allows us to navigate disagreements with grace, respect, and consideration, leading to more constructive discussions and the potential for mutual growth. By fostering empathy-driven conflict resolution, we strengthen the bonds of trust and create a harmonious online environment.Empathy has the power to inspire positivity and drive change. In a digital world often plagued by negativity, hate speech, and online harassment, empathy becomes a catalyst for transformation. By consciously choosing to respond with empathy and compassion, we can counteract the negativity and create a ripple effect of kindness. Empathy encourages us to be more mindful of our words and actions, promoting empathy-driven initiatives, and supporting causes that uplift and empower others. Through collective efforts, empathy can drive significant change in the digital world, fostering a more empathetic and inclusive online community.
An operational and cultural shift that reveals the true heart and values of a firm is the adoption of an empathic and human-centered approach to leadership. Putting an emphasis on an employee’s skills, qualities, and characteristics that make them uniquely human demonstrates that they are working for brands that actually reflect what they regard as significant and that respect the contributions they contribute to meeting the objectives of the organisation and the individual. Such a move might position your brand as the employer of choice and make a significant difference to your staff retention statistics. Given that many employees are still evaluating their long-term career plans and looking for opportunities that line with their fundamental values, this could position your brand as the employer of cchoice Managers and business leaders must keep in mind that, above all else, your business is your people as we move forward into 2023 with the possibility of a recession and numerous problems ahead. Leaders would be foolish to overlook their team’s demands and expectations while creating your organization’s culture and long-term strategies since they are the ones who will secure your success in the months and years to come, regardless of what you sell or deliver. It takes time to create an empathic workplace culture, but even while it might not be the quick cure you were hoping for, it could mean the difference between failure and success for your business.
Many businesses have used empathy effectively in their lead generation campaigns, and these businesses’ achievements are proof of the effectiveness of this strategy. Here are a few instances of businesses that use empathy in their lead generating campaigns. Zendesk: Zendesk is a customer service software company that uses empathy in their lead generation efforts by actively listening to potential customers and tailoring their approach to meet their specific needs. By using empathy to build trust and establish a connection with potential leads, Zendesk has been able to generate a large number of high-quality leads.Using personalised content that speaks directly to the wants and worries of potential leads, marketing and sales software business Hubspot leverages empathy in their lead generation efforts. Hubspot has produced a lot of high-quality leads by leveraging empathy to establish a human connection with potential leads.In order to generate leads, Salesforce, a provider of customer relationship management software, understands the wants and motives of potential customers and then adjusts its strategy accordingly. Salesforce has been successful in producing a significant number of high-quality leads by leveraging empathy to foster trust and establish a connection with potential leads.
In a digital world where technology can sometimes hinder genuine human connections, empathy serves as a powerful antidote. By embracing empathy, actively listening, validating others’ experiences, and supporting one another emotionally, we can build bridges that connect us on a deeper level. Empathy fosters understanding, resolves conflicts, and promotes positive change, transforming the digital sphere into a more compassionate and inclusive space. Let us harness the power of empathy to forge meaningful connections and make a difference in the lives of others in our interconnected digital world.
Science & Technology
U.S, China and Russia: Intelligence, Cybersecurity and new developing technologies
Interview with Prof. Giancarlo Elia Valori
China has been investing heavily in technological innovation, particularly in areas such as artificial intelligence and 5G. How do you see China’s technology industry evolving in the coming years, and what implications could this have for the rest of the world?
In recent years China has delved into the importance and development prospects of artificial intelligence (AI) in many important fields. Stepping up the development of a new generation of AI is an important strategic starting point to stay ahead in the global technology competition.
The current gap between AI development and the advanced international level is not very wide, but the quality of companies must be “matched” by their number. Efforts are therefore being made to expand application scenarios, by strengthening data and algorithm security.
The concept of third-generation AI is already advancing and there are hopes that the security problem will be solved through technical means other than policies and regulations, i.e. mere talk.
AI is a driving force for the new stages of technological revolution and industrial transformation. Accelerating the development of a new generation of AI is a strategic issue for China to seize new opportunities for organising industrial transformation.
It is commonly argued that AI has gone through two generations so far. AI1 is knowledge-based, also known as “symbolism”, whereas AI2 is based on data, e.g. big data, and their “deep learning”.
AI started to be developed in the 1950s with the famous Test by Alan Turing (1912-1954), and the first studies on it started in China in 1978. In AI1, however, progress was relatively small. Real progress has been made mainly over the last 20 years – hence IA2.
AI is known for the traditional IT industry, typically the Internet companies. It has accumulated a large number of users in the development process, thus establishing corresponding patterns or profiles based on these acquisitions, i.e. the so-called “users’ taste knowledge graph” of users. Taking the delivery of certain products as an example, tens or even hundreds of millions of data consisting of user and merchant location information, as well as information about potential buyers, are incorporated into a database and then matched and optimised by means of AI algorithms. This obviously enhances trade efficacy and the speed of delivery.
By updating and upgrading traditional industries in this way, great benefits have been achieved. In this respect, China is leading the way: facial recognition, smart speakers, intelligent customer service, etc. In recent years, not only has an increasing number of companies started to apply AI, but AI itself has also become one of the professional directions that most worries candidates in university entrance exams.
According to statistics, there are 40 AI companies in the world with a turnover of more than $1 billion, 20 of them in the USA and 15 in China.
The core AI sector should be independent of the IT industry, but open up more to transport, medicine, the urban substrate, and industries directed autonomously by AI technology. These sectors are already being developed in China.
China accounts for more than a third of the world’s start-ups in the AI field. While the quantity is high, the quality still needs to be improved, although there are signs that it will evolve geometrically.
The AI implications in today’s world are therefore knowledge and technological advantages that determine – to a large extent – the differences in the management of international politics. The increase in a country’s intellectual power directly defines an increase in its economic power, thus changing its positioning in the international competition for dominance.
The politics of power – first in the agricultural era and later in the industrial era – was characterised by military and then economic hegemony, while the politics of power in the information era gradually reveals the characteristics of knowledge-based hegemony at the scientific level, which will indeed be essentially based on artificial intelligence.
2. Some people have accused China of engaging in unfair trade practices, such as dumping goods on foreign markets or stealing intellectual property. What is your opinion on these allegations, and do you believe China should be held accountable for these actions?
In fact, many Western media report that China is circumventing or breaking trade rules. Its economic manipulations have cost millions of US jobs, hurting workers and companies there but also around the world. Media also report that the United States will reject market-distorting policies and practices, such as subsidies and barriers to market access, which the Chinese government has used for years to gain a competitive advantage.
In fact, China has faithfully fulfilled the commitments made when it joined the World Trade Organisation (WTO). China supports, builds and contributes to the multilateral trading system. Economic and trade relations between China and the United States are mutually beneficial. Nevertheless, the economic war between the People’s Republic of China and the United States in the trade and investment areas has been the main cause of trade frictions between the two countries, which harm others without benefiting themselves either.
Over the last twenty years since joining the WTO, China has seriously fulfilled the commitments made upon accession. It has extended the pre-determined national treatment management system to the national level. It has continued to expand market access. It has reduced the overall tariff level from 15.3 to 7.4 per cent, and opened up nearly 120 service sectors.
In October 2021 the WTO conducted its eighth review of China’s trade policies and practices. The review report fully recognised China’s efforts in supporting the multilateral trading system and its active role within the WTO.
A leading official of the UN Conference on Trade and Development pointed out that, over the past two decades, China has firmly supported the rules-based multilateral trading system; practised genuine multilateralism; fully participated in WTO negotiations; led talks in areas such as investment facilitation and e-commerce, and worked for up-to-date WTO rules.
China and the United States have highly complementary economies, deeply integrated interests, and mutually beneficial economic and trade ties. In 2021 bilateral trade exceeded a record USD 750 billion. The US Export Report 2022 released by the US-China Business Council showed that in 2021 exports of goods to China grew by 21% to USD 149 billion, supporting 858,000 US jobs. The Annual Business Survey 2020 report on Chinese companies in the United States, released by the China General Chamber of Commerce-USA, indicated that, as of 2019, Chinese CGCC member companies cumulatively invested more than USD 123 billion, as well as employed over 220 thousand people, and supported more than one million jobs in the United States. A study by the US-China Business Council showed that Chinese exports helped reduce consumer prices in the USA by 1 to 1.5 per cent, saving each US household USD 850 a year.
A report by Moody’s Investor Service was quoted as saying that US consumers bear 92.4% of the cost of imposing tariffs on Chinese products. Paul Krugman – 2008 Nobel Prize-winning economist – has incisively pointed out that the US trade policy towards China is disadvantageous and tariffs hurt the USA more than its intended targets.
On 18 May 2022 the National Retail Federation (NRF) wrote to President Biden asking for the removal of tariffs which, as outlined in the letter, could reduce consumer prices by up to 1.3%. The US Secretary of the Treasury, Janet Yellen, said that some tariffs on China’s products harm US consumers and businesses and that it is worth considering cutting them to lower inflation in the USA.
I believe that – like any war – a trade war is detrimental to both sides and that – unlike the Cold War, when an opponent wanted to impose its own ideologies and forms of government and State on the other – here we end up with a country, namely China, that only demands trade and does not advocate any political revolution.
3. China has been rapidly expanding its military capabilities in recent years, with a focus on developing new technologies such as hypersonic missiles and aircraft carriers. What do you think is driving this expansion, and how do you see China’s military posture evolving in the coming years?
With a country of 1.4 billion inhabitants, the Chinese armed forces are inevitably bound to expand and strengthen. Throughout Chinese history, the military has been a fundamental factor not only in the existence of the State, but also in the liberation struggles against Japan and the various doctrines that later tried to isolate the People’s Republic of China, such as Containment, etc. In a world led by a single leader, namely the United States of America, it is important to understand the moves of the States that seek not to be sidelined. China is certainly one of the States that aspire to play at least an equal role in international relations with the USA. The military force that China has been developing over the past fifteen years has seen a significant expansion of its fleet. According to a US study, the need to secure the islands in the South China Sea would be the crux of the whole project. The Chinese island of Hainan is in fact the starting point of a maritime route that would connect China with Pakistan in the Middle East and with Djibouti in the Horn of Africa.
The Chinese strategy is to invest in civil (and not military) infrastructure such as ports, oil pipelines, roads, gas pipelines within allied countries that would thus ensure security and allied bases in the Indian Ocean. Security is a crucial factor in understanding this strategy because since 1993 China has become a net importer of oil (i.e. China’s oil demand is greater than supply) and oil is imported both by land and by sea. The latter option is obviously used with African and Middle Eastern countries, but the trade route is in one of the areas with the highest concentration of sabotage, kidnapping and violence by pirates. Having allies with whom to ensure security in enemy waters becomes therefore crucial. Allied bases, however, also have the function of enabling Chinese ships to have easy and quick passage through three of the world’s richest and most dangerous straits, namely the Bab al Mandeb Strait (between Yemen and Djibouti), the Aden Strait (between Iran and Oman) and the Malacca Strait (between Indonesia and Malaysia).
I do not see why China should not strengthen its strategic potential, since all countries – from the strongest to the medium ones – do so on a regular basis, as a function of planned commercial development. It is only natural that this should also involve the development of new technologies such as hypersonic missiles and aircraft carriers, as denying this smacks of a fairy tale told to children.
4. China has been increasingly active in international organizations such as the United Nations, and has been working to establish new institutions such as the Asian Infrastructure Investment Bank. What is China’s broader strategic vision for its role on the global stage, and how do you see this evolving in the coming years?
On 15 May 1648, the first treaty of the Peace of Westphalia was signed in Osnabrück by the Protestant princes, marking the end of the conflict between Sweden and the Habsburg Empire. Later, on 24 October 1648, the Catholic princes signed two additional treaties in Münster.
Westphalia – and, to an even greater extent, the Congress of Vienna (1 November 1814 – 9 June 1815) that replaced it – was also based on three pillars, namely multipolarism, a balance of powers and a concert of powers, which mainly meant the importance of the great powers: Austria, Prussia, Russia and the United Kingdom. In many respects, the same principles were characteristic of the Yalta-Potsdam system, which determined relations between the two superpowers during the Cold War. The rules of international law were respected mainly because there was a force behind them that could not be ignored. This is the reason why peace reigned on the European continent, and the interests of the Union of Soviet Socialist Republics and the United States of America clashed mainly in the countries on the periphery – i.e. by shifting the Second Thirty Years’ War (1914-1945) to the countries of the Third World and the Balkans, so that the war industries in the West and in the East would anyway have their theatres and market outlets. Little could the People’s Republic of China do by calling the former social-imperialists and the latter imperialists tout court, and branding them both as hegemonists.
As stated by Henry Kissinger, when in the early 1970s the People’s Republic of China embarked on its re-entry into the international diplomatic system at Zhou Enlai’s initiative and, at the end of that decade, on its full entry into the international scene thanks to Deng Xiaoping, its human and economic potential was vast, but its technology and actual power were relatively limited.
China’s growing economic and strategic capabilities have meanwhile forced the United States to measure up – for the first time in its history – to a geopolitical competitor whose resources are potentially comparable to its own.
Each side sees itself as an unicum, but in a different way. The United States acts on the assumption that its values are universally applicable and will eventually be adopted everywhere. China, on the other hand, expects that the uniqueness of its ultra-millennial civilisation and impressive economic leap forward will inspire other countries to emulate it so as to break free from imperialist domination and show respect for Chinese priorities.
Both the US missionary impulse based on a sort of “manifest destiny” and the Chinese sense of grandeur and cultural eminence – of China as such, including Taiwan – imply a kind of subordination-fear of each other. Due to the nature of their economies and high technology, each country is affecting what the other has hitherto considered its core interests.
In the 21st century China seems to have embarked on playing an international role to which it considers itself entitled by its achievements over the millennia. The United States, on the other hand, is acting to project power, purpose, and diplomacy around the world to maintain a global balance established in its post-war experience, responding to tangible and imaginary challenges to this world order.
For both sides’ leaders, these security requirements seem evident, and are supported by their respective publics. Yet security is only part of the grand discourse. The key issue for the planet’s existence is whether the two giants can learn to combine the inevitable strategic rivalry with a concept and practice of coexistence. It is for this reason that China is increasingly active within international organisations to stabilise its role on the evolving global scene.
5. What is your perspective on the potential military applications of China’s space program, such as anti-satellite weapons or space-based surveillance systems?
Let us start by saying that the successes of the advanced Soviet missile war industry of the 1950s-1960s and the refined and extremely rich US military technology of the 1960s-1970s were certainly not due to moral missions in favour of knowledge and mankind or anything else, but were an extreme arms race. Denying this is tantamount to telling jokes in a bar. The same holds true for President Reagan’s Strategic Defense Initiative in the 1980s. President Reagan at least had the good taste not to describe it with do-gooding rhetoric in favour of science and the welfare of peoples on Earth. Moreover, anti-satellite weapons and space intelligence systems or space-based surveillance, as you call it, have existed for decades.
Today the People’s Republic of China is also capable of navigating in space. One thing must be said: the competition is based not on the hope of reaching Mare Tranquillitatis (the Sea of Tranquillity) on the Moon or Utopia Planitia (the Nowhere Land Plain) on Mars, and from there bombing the District of Columbia.
Let us go back in time. Faced with the US and Soviet successes in the space field, Mao Zedong in the 1960s was shocked and asked: “How can we be considered a powerful country? We cannot even shoot a potato into space!!!”
Years later, in the late 1970s, Deng Xiaoping replied to him: “If China had not a nuclear or a hydrogen bomb or had not launched satellites since the 1960s, it would not be called an important and greatly influential country and would not have its current international status”. Therefore, in the 21st century, manned space flight represents all of this.
On 25 December 2021, NASA launched the James Webb space telescope for infrared astronomy, capable of analyses considered impossible until a few years ago, i.e. taking detailed, full-colour pictures of an exoplanet. The James Webb telescope is completely different from those in space. It gives the possibility to observe the reflected light of exoplanets and the electromagnetic spectrum in order to detect potential biological or mineral traces. The future lies in space research, not in Star Wars, as well as in reaching the nearest asteroids and meteorites, and looking for habitable exoplanets in the distant but not remote future. On our Earth, mineral raw materials are running out. The same holds true for water, and therefore space exploration today is not aimed to wipe the opponent off the face of the earth, but to collaborate between superpowers to seek alternatives to the depletion of land and even water resources that currently – and we do not know yet for how long – permit these high levels of technology. The Chinese space programme aims primarily at this and not at destroying potential opponents, without whom the real conquest of space would not be possible.
6. How do you see China and Russia collaborating or competing in areas such as energy, technology, and military affairs?
From the tsarist expansion to the subsequent unequal treaties, until the crisis in the 1960s with the Soviet Union – as the latter had excluded it from the possibility of having the nuclear weapon, fearing the populous and enthusiastic heavy-handed neighbour that later brilliantly shifted the issue to the ideological side, thus eroding Soviet power over many of the world’s ruling and non-ruling Communist parties – China, per se – and I am not just referring to the People’s Republic of China (1949-2023) – had always held off first St Petersburg and then the Kremlin. For China – indeed for the Middle Empire – a strong Russia on the border is a disadvantage, but a weak neighbour which, in turn, can be other-directed by third parties – as happened in the 1990s – is also dangerous. The traditional solution of China’s two-thousand-year-old diplomacy is to seek a balance that does not create crises in Eurasia which, as is well known, is the last resource reservoir on planet Earth. In 2021, on the occasion of the 20th anniversary of the establishment of the Shanghai Cooperation Organisation and the signing of the Sino-Russian Treaty of Good Neighbourliness, Friendship and Cooperation, relations between the two countries entered their third decade of stability without any form of military alliance, or even Chinese support for the invasion of Ukraine. It should also be said that arms sales to one side are counterbalanced by the other side’s same action.
7. The United States has accused China of being a major threat to its cybersecurity, with allegations of state-sponsored hacking and cyber espionage. What is your perspective on this accusation, and how do you see the cybersecurity relationship between the US and China evolving in the future?
From time immemorial, intelligence or espionage, or whatever you call it, has always been adopted simultaneously by the parties involved, with the most efficient means of the time, ranging from smoke signals to sympathetic ink, from cartographic cryptography to Enigma, from spy planes to the famous James Bond-style mini cameras. Today it is the same: the fear of espionage – be it cyber, cybernetic or satellite espionage – is two-faced, and the accusations of one side to the other are mirrored by those of the other to the one side. They therefore cancel each other with the result that whoever is better equipped knows more than the one who is less prepared. There are no victims and oppressors, there are no good guys and bad guys. There is only the reason of State, as Machiavelli teaches us.
8. Russia has been accused of meddling in the 2016 US Presidential election through hacking and cyber espionage. How do you see China’s relationship with Russia in the realm of cybersecurity, and do you think China could be implicated in similar activities?
You know, I am merely a business manager, a geopolitical scholar and a university professor. Part of my answer on China-Russia relations is under point 6. However, in order to fully answer this brilliant but very difficult question of yours, we should address to the highest-ranking and most arcane levels in the USA, Russia and China.
Thank you for the interview.
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