US-China trade war and its wider implications By Tariq Niaz Bhatti

US-China trade war is making headlines these days as President Trump has unveiled plans to impose tariffs @ 25% on selected imports from China as part of his trade protectionism strategy. China has also come up with its tit for tat response which may disrupt 2.1 million jobs in 40 U.S. industries that produce 234 products listed by China for potential tariff. In January 2017, President Trump withdrew from Trans Pacific Partnership (TPP) deal declaring his intentions of curtailing expanding China’s soft power. China’s grand strategy of trade growth through infrastructure development has initiated a race for trade dominance amongst regional rivals under US tutelage.
Following enormous success of its economic model for the past two decades, China introduced Belt and Road initiative (BRI) to explore and access demand for its products and services globally and facilitate import of raw material. China-Pakistan Economic Corridor (part of BRI) will connect Xinjiang with Gwadar Port and help establish a land bridge to connect Shanghai and other Ports at Pacific Ocean with Gwadar Port at Indian Ocean. CPEC will provide China with all-weather dual ocean access and reduce its dependence on Malacca Straits where US influence is overwhelming. In Robert D. Kaplan words China does not come armed with a missionary approach to the world affairs. It has no ideology or system of Government it seeks to spread. Moral progression in international politics is not China’s goal and yet China is not a status quo power: for it is propelled abroad by the need to secure energy, metals and strategic minerals in order to support the rising living standard of a one fifth of humanity. China’s core national interest i.e. economic survival and growth drives it beyond its official border through its vertical expansion of soft power.
Trump’s new U.S. policy in Afghanistan envisages sending more troops and enhanced Indian role there, points towards prolonged stay of US led coalition forces. US pivot Asia policy has strengthened its hold along Malacca and Sunda Straits and its support to regional countries against Chinese “Nine Dots Line” claim in South China Sea is meaningful in the context of China’s huge seaborne trade dependence on Malacca Straits. President Trump in his new strategic security policy announced in 2017, had declared both China and Russia as revisionist powers which received angry responses from both. Under US tutelage, Japan is moving in high stakes tussle of influence in South Asia and Afro Indian Ocean as part of its Free and open Indo Pacific strategy. Japan in partnership with India, is moving ahead with Asia Africa Growth Corridor initiative estimated at U.S. $40 Billion which will pool together India-Japan funding and expertise in building infrastructure in Africa.
U.S initiative in containing China’s soft power has started to show its wide-ranging implications in South Asia. Indian PM Modi’s recent visits to the Gulf States helped secure hefty investments specially from KSA. His visit to Iran in the backdrop of reenergizing international North South Transit Corridor (INSTC) Project was highly successful. In September 2017, Japanese PM Abe’s visit to India also saw signing of civil nuclear deal with a non-NPT state and other agreements on joint extra regional development initiatives. Recently there have been trilateral India-US-Japan naval exercises as part of Malabar series and India-Japan maritime exercise (JIMEX) in the Indian Ocean. Due to US desire of enhanced Indian role, Afghanistan has attached conditions to joining the CPEC until India is given rail-road access at Wahga to trade with Afghanistan. Iran’s response to joining the CPEC is not very warm to say the least.
US grand strategy of containing China’s soft power in South Asia and Afro Indian Ocean is going to have grave implications for CPEC project. Due to deteriorating regional security situation terrorist groups like Daesh, Taliban and Al-Qaeda may create law and order situation in Pak-Afghan border regions and Balochistan which will affect the CPEC projects. Pakistan need to boost its economic cooperation with GCC countries and enhance its trading relations with Iran, Turkey and Central Asian States using ECO platform to improve its economic outlook. Under Trump Administration US-India relations are warming up covering all fields. This has helped India to pursue its policy of no talks with Pakistan on the pretext of cross border terrorism. India’s hardening of stance is one of the outcome of our poor economic performance which cannot go on indefinitely. To offset the effects of regional economic alliances and making CPEC a success, Pakistan needs to reopen talks with India on all bilateral issues. To seek positive Indian response to bilateral talks, Pakistan will have to put its own house in order first through improved economic performance.
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