China, Cyber Security, Politics / Globalisation, Writing

Made in China: A Digital Agenda for the Quad

In the Indo-Pacific and beyond, China’s growth in capabilities and political authoritarianism are now threatening to alter how we engage with technology and digital domains. China believes it has the right to access other nations’ information and networks without offering up access to its own. This is not a simple techno-mercantilism. There is a single purpose to China’s deepening investments in existing and future technologies: furthering the agenda of the Chinese Communist Party (CCP).

For Beijing, technology is about both national security and ideology. Under Xi Jinping, it will use the information age to rewrite every assumption of the postwar period. Countries outside China must join together to seek open, safe and inclusive technology and digital platforms and products.

There are five main ways in which we can shape national, regional and global engagement with our digital world. These must also drive the purpose and direction of the Quad countries (the United States, Australia, Japan and India) as they strive to create a technology and digital partnership in the Indo-Pacific.

‘China tech’ was for the CCP initially about managing the social contract within China. Now, the CCP is weaponising and gaming other nations’ democracies, public spheres and open systems. It is creating a digital insurgency that allows it to delegitimise its opponents on their own political turf. This goes beyond episodic interference in elections. The CCP uses American forums such as Twitter and Facebook to critique the domestic and foreign policy of nations such as India. Wolf warriors seek to shape the information space internationally while China and the CCP remain protected behind the Great Firewall. The unimpeded global access China is allowed under some perverse notion of free speech must be questioned; internet propaganda endorsed by authoritarian regimes cannot and should not go unchecked. As a first step, the world will have to embrace a political approach to repel the digital encroachments we are witnessing. The European Union offers a model – just as its General Data Protection Regulation sought to rein in the US technology giants, we need laws that limit China’s access to the public spheres of open societies, thereby curtailing its global influence.

Today, all digital (silk) roads lead to Beijing. Many developing countries rely on China for their technology sectors. From control over rare earths and key minerals to monopoly over manufacturing, China commands the digital spigot. The Quad countries and others in the Indo-Pacific must seek and encourage diversification. Affordable, accessible products and innovations must emerge in the digital space. From resilient supply chains to diversity of ownership, a whole new approach is needed to prevent the perverse influence of any single actor. This is the second way to shape global patterns of digital engagement.

The Chinese under Xi have embraced the dangerous essence of the Chinese phrase ‘borrowing a boat to go out to the sea’. The CPC has essentially borrowed all our boats to further their agenda.

Universities in the developed world, their media, their public institutions and even their technology companies are serving and responding to missives from the Middle Kingdom. Many journalists have exposed the Western media’s promiscuous entanglements with a Beijing that artfully co-opts them into its propaganda effort. In the digital age, this cannot be ignored. Countries will soon be faced with a digital fait accompli – signing on to Pax Sinica. As a third way to enhance engagement, it is time to protect liberal institutions from their own excesses.

China has attempted to internationalise its currency with the launch of its own digital currency. After banning financial institutions and payment companies from providing crypto-related services in May, China launched a crackdown on computer-powered crypto mining in June, and a blanket ban on all crypto transactions and mining in September, clearing the way for its digital renminbi (digital RMB). With the development of its own central bank digital currency, the Chinese government will now have the power to track spending in real time. It will have access to the entire digital footprint of a citizen or a company. This will provide Beijing with an unprecedented vault of data, which it can use to exercise control over technology companies and individuals.

The rise of China’s digital RMB has the potential to challenge the status of the American greenback. For decades, the US dollar has been the world’s dominant reserve currency. Yet countries such as Iran, Russia and Venezuela have already begun using the Chinese yuan for trade-related activities or replacing the dollar with the yuan as reference currency. China can shape all three attributes of the ‘ideal’ currency, also referred to as the ‘Impossible Trinity’: free capital flow, a fixed exchange rate and independent monetary policy. It is a matter of time before it uses currency as part of its wider geopolitical plans. And with its past experiments with many countries on ‘trade in local currency’, it will have the capacity to create disruptions in the global monetary system. This can only be countered with two measures: one, depoliticising the existing dollar-led currency arrangements (the tendency to weaponise the SWIFT system – a giant messaging network used by banks and other financial institutions to transmit secure information – and to employ ad-hoc economic sanctions) and two, investing in the economic future of the emerging economies that currently depend on China.

Lastly, China is seeking technological domination not only terrestrially but also in outer space. China has invested considerably in space technology and engages in counterspace activities. These include suspected interference in satellite operations, both through cyberattacks and ground-based lasers. There are growing fears that Chinese technologies developed for ostensibly peaceful uses, such as remote satellite repair and cleaning up debris, could be employed for nefarious ends. The inadequate space governance mechanisms is an opportunity for the Quad to develop situational awareness in the space realm to track and counter such activities, and to develop a new set of norms for space governance.

The Quad’s agenda is prescribed by China’s actions. It will have to be a political actor and have the capacity to challenge China in the information sphere and the technology domain. It will need to be a normative power and develop ideas and ideals that are attractive to all.

From codes and norms for financial technologies to the code of conduct for nations and corporations in cyberspace and outer space, the Quad has the responsibility and opportunity to write the rules for our common digital future.

The Quad will also have to be an economic actor and build strategic capacities and assets in the region and beyond. It will have to secure minerals, diversify supply chains and create alternatives that ensure the digital lifelines are not disrupted.

Most importantly, the Quad will need to be an attractive partner for others to work with. This is its best means to counter China’s dangerous influence.

China, foreign policy, Great Power Dynamics, India, international affairs, Research, Strategic Studies

Communist Inc: The Pandemic and China’s World

Co-authored with Akhil Deo

The Communist Party of China will celebrate the 100^th anniversary of its founding this July. This marks the first significant milestone in Chairman Xi’s “China Dream”, a project that will ostensibly culminate in 2049, the 100^th anniversary of the founding of the People’s Republic, with associated aspirations of China cementing its position as a global power. In our book, Pax Sinica, we had detailed three instruments that are crucial to these ambitions: Leadership over global institutions and processes, a conducive environment for achieving “discourse power”, and the construction of new international coalitions. China seeks to control global institutions and rule-making processes, grease and dominate the media and public sphere into a favourable disposition, and enter into perverse partnerships with other nations, described as a “loan for sovereignty” arrangement in one of its avatars.

The onset of the pandemic has made many of these strategies more visible, even as it highlighted the opportunities and challenges that lie ahead for China.

China’s global dominance strategies

For the past decade or more, China has pursued a dual strategy of co-opting post-war institutions while simultaneously pursuing its own brand of multilateralism through the Belt and Road Initiative (BRI) and an assortment of formal and informal fora, such as the Shanghai Cooperation Organisation. Three approaches guide China’s strategy: Building global influence and prestige; shaping and/or altering key norms, standards, and processes; and creating the capacity to withstand pressure for selectively disregarding international rules.

The fruits of these efforts were visible amid the pandemic, most controversially at the WHO, which struggled to balance its commitment towards transparency and accountability, and its operational reliance on and systematic infiltration by China. Under cover of the pandemic, China has made more significant inroads as well. In April 2020, China was appointed to the influential United Nations Human Rights Council (HNRC) consultative group, which plays a crucial role in selecting global monitors for free speech, arbitrary detention and forced disappearances—the very rights that Beijing crushed in Hong Kong and Xinjiang.

One aspect of this ploy of the Communist Party of China (that effectively and absolutely owns the country) that often goes unnoticed in India is China’s leadership in technology standard-setting organisations. Over the past decade, Beijing has improved its representation in, and submissions to, the technical committees and sub-committees of organisations like the International Organisation for Standardisation and the International Electrotechnical Commission. In March 2020, China’s Standardisation Administration published an innocuous document outlining the elements of a more ambitious strategy known as China Standards 2035. The 15-year blueprint will chart a pathway for China to dominate standards in emerging industries, giving it the ability to set the terms of international trade and even define the relationship between technology and society globally.

Augmenting China’s influence in international organisations and standard-setting bodies is its global media and narrative management strategy—an essential facet of “discourse power”

Augmenting China’s influence in international organisations and standard-setting bodies is its global media and narrative management strategy—an essential facet of “discourse power”. Chairman Xi alluded to this in a recent speech, calling for China’s media to develop an “international voice”. The research in our book highlighted what scholars called China’s policy of “borrowing a boat to go out into the ocean”. In other words, China’s use of paid inserts and large advertisements in newspapers allows it to propagate its narratives. Two recent reports provide insight into how significantly these efforts have evolved and intensified.

The first, by the Associated Press and the Oxford Internet Institute, describes China’s use of bots and fake social media accounts to amplify its “wolf warrior” diplomats and their proxies online. While China has previously used these tactics in Taiwan and Hong Kong, such operations have taken on a global scope amid the pandemic. Beijing’s appetite for misinformation, exemplified famously by Zhao Lijian’s claim that the coronavirus originated outside China, only exacerbated the challenge. The second, from the International Federation of Journalists, posits that Beijing’s strategy of syndication appears to be paying off. Over the year, its inserts into local media, increasingly in vernacular, along with a more engaged diplomatic community, have bolstered its visibility in the developing world.

Beyond its media strategy, China continues to fund educational institutions through opaque means, sometimes with attached costs to academic freedom. The Communist Party also increasingly hosts foreign diplomats and security officials for training programmes on “information management” and sponsors ruling party politicians around the world to attend training sessions on party building and governance. In 2020, under pressure from Western scrutiny, Beijing rebranded its infamous Confucius Institutes and handed over operations to a ‘non government organisation’ defined by the party. However, the US and Europe aren’t necessarily the targets of its educational and cultural investments. A report from Aid Data in 2018 revealed that countries that are more aligned with China’s foreign policy receive the bulk of its largesse. While it is unclear yet what gains have accrued to Beijing from such initiatives, they represent a formidable institutionalised apparatus to export its ideology and political practices.

The Communist Party also increasingly hosts foreign diplomats and security officials for training programmes on “information management” and sponsors ruling party politicians around the world to attend training sessions on party building and governance

Backdoor entry into the EU

Finally, we had highlighted China’s strategy of building new coalitions and undermining existing ones. Nowhere was this more apparent than Europe, where Beijing’s 17 + 1 platform for engaging with Central and East European (CEE) nations had triggered concern about its “divide and rule” tactics. To some extent, China’s investments in the region have paid off— with countries like Greece and Hungary scuttling the EU’s efforts to criticise China’s violations of international law in the South China Sea and the passing of the national security law abuses in Hong Kong.

2020 dampened this momentum for China—and demonstrated that large powers can still secure their peripheries. Several East and Central European leaders expressed dissatisfaction with the pace of investments and many were no-shows at the China-led forum. Many have also signed onto the US’s Clean Network Initiative, intended to prevent the entry of China’s 5G companies into key markets. The Baltic states, meanwhile, were more apprehensive about Russia than they were keen on Chinese investments.

Nevertheless, the 17 + 1 platform is but one instrument in China’s more global “perverse diplomacy” toolkit, and writing it off is premature. It marks a permanent presence that China now enjoys at the EU’s doorstep, one that the CEE can always leverage for better terms from Brussels. At the very least, China is now a voice in domestic EU debates.

China also hosts a web of high-level forums and summits in nearly every part of the world, including the Arab states, Africa, Latin America, and the ASEAN. Beijing’s vaccine diplomacy has won it praise in most of these geographies—especially in the face of Western absence and selfish acts of the past year. These forums augment and bolster various initiatives, ranging from China’s infrastructure investments to promoting its technology propositions. And its economic presence and investments are buying it diplomatic support as well. For instance, the support of African states has been crucial for China when its record in Xinjiang and Hong Kong was questioned in the UN in 2020 and 2019.

When looking at the pandemic in retrospect, Chinese leaders will likely see parallels to the 2008 financial crisis—one more milestone in the long decline of the West, and China’s rise. Beijing robustly managed the pandemic at home and stepped up to provide global public goods. To be sure, it faces new headwinds: Public opinion of China has plummeted in the West, the Biden administration is gearing up for great power competition, the EU has ‘frozen’ its latest investment deal with China, and institutions like the G7 are stepping up to offer alternatives to the BRI.

Public opinion of China has plummeted in the West, the Biden administration is gearing up for great power competition, the EU has ‘frozen’ its latest investment deal with China, and institutions like the G7 are stepping up to offer alternatives to the BRI

Elsewhere, the message from China over the past year is resilience and continuity. It remains committed to an alternative form of globalisation via the BRI. Its influence over international institutions will only grow, proportional to its wealth and power. Beijing’s media is increasingly savvy in projecting and protecting its core interests. Further, contrary to the perception that China is “friendless”, it can call upon nations to support it when it matters. And even when there is pushback, it is often haphazard. The recently announced “Build Back Better World”, while grand in intent, struggles with the contradictions within the group on their assessment of the Middle Kingdom. Key countries have chosen trade over security and valuations over values in their engagement with China.

The future of the Indo-China relationship

Where does this leave India? Our book warned that Doklam was unlikely to be the last border confrontation between the two Asian powers. We argued that it opened a new tense period between India and China—an Asian Cold War. The Galwan Valley Clash confirmed the advent of a new era of high altitude faceoffs with possible ramifications in the oceans as well. This rift has only grown wider amid the pandemic. China’s belligerence in the Himalayas, and India’s restriction on Chinese technology platforms as well as its alignment with coalitions competing with China have all but cemented contestation. This will drive engagement in the years ahead.

New Delhi will confront a more fundamental dilemma: On the one hand, political tensions with China will remain high. But on the other, it is dependent on trade with China for its economic objectives—a dependence that will likely remain given the adverse economic consequences of the pandemic. Indeed, data published by Chinese customs officials revealed that trade with India boomed in 2021, even as Beijing appears to be consolidating its position in the Himalayas. How India resolves this contradiction and builds a security posture that accounts for this will indeed define the relationship.

New Delhi needs clarity of thought and a national consensus on China. In the coming days, it will have to take a leaf out of the Chinese playbook and engage in trade with the one that seeks to do it harm. Its economic engagement must be alive to this and its security considerations immune from these entanglements. It must realise that it cannot trade or talk its way into a better relationship with Beijing. These are important but essentially sideshows to the principal theatre of engagement. Deceit and political muscularity is the new grammar of the bilateral that China has proffered. With limited recourse available, the time for India’s legendary ambiguity is long past.

PAX SINICA: Implications for the Indian Dawn, by Samir Saran and Akhil Deo, is available here.