Ladakh Flash Point
- Thread starter Mt1701d
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To compare Vietnam's economy in 1979 to India's now is not accurate, Vietnam was full on war economy after many wars in a row (plus it was still fighting in Cambodia). It might put more economic pressure on India but to suggest it will lead to the collapse of the Indian economy is in my view impossible.
To compare Vietnam's economy in 1979 to India's now is not accurate, Vietnam was full on war economy after many wars in a row (plus it was still fighting in Cambodia). It might put more economic pressure on India but to suggest it will lead to the collapse of the Indian economy is in my view impossible.
Vietnam might be a much weaker country compared to India, but the principle still stands. A layer of the Indian economy is resilient, but high growth depends on foreign investment. There, they are quite vulnerable. At this point, foreign currency reserve is so low that they are just enough to pay the interest of their large foreign debt for three years. The source of their foreign currency are mainly in three sources.
1. repatriation from abroad by workers. This has been cut due to Covid.
2. exports, the Indian IT service industry is not growing like it use to anymore. India produces very little goods to sell abroad, mainly minerals.
3. investments from abroad.
The IT industry is fragile. It depends on power and communication cables which could be cut in a war. New Deli is 300 km from the Chinese border. a few missiles can destroy enough power plants to turn it dark for months. Same with oil refineries.
War is also not good for investments from abroad. There are enough groups like the Kashmiris and the Maoists that China just have to provide some weapons and training to see bombs going off in all big cities, and cables cut. That investment was already waning anyways as the Indians do not allow foreign money to make a profit. Just ask Walmart how much money they lost trying to invest into India. The Chinese may ask for tech transfer, but they never not allow foreign corporations to make a profit.
It is not hard to see the Indian economy growing at 0-3% or lower as long as the war is being fought. While I would not call this as collapse, but it nevertheless means stagnation while the rest of the world moving on. Since they cannot even make ammo, there will be a giant sucking sound for their precious foreign reserve to buy weapons that are used/destroyed/broke during the war. This competes directly with buying stuff to maintain their factories.
The sadder thing is, it does not have to be this way, but they pick this path.
Maybe this is the reason why India doesn't want to have peace. A border conflict is a perfect distraction for Modi's total incompetence in managing India economy and inability to do anything to stop the spread of coronavirus.
There is something I realized which we have not previously discussed. As most of you know, the Astra-zeneca trials have suffered a setback. Whether its serious or they can resume in a week still remains to be seen. Unfortunately, India's vaccine strategy had been based almost entirely on Astra-zeneca/Oxford (hence the order for 1 billion doses by the serum institute), as it was well known that they also have thier own candidates but they are only just reaching phase II, and likely won't be into phase III until at least November/December. They never diversified like other countries in putting in multiple orders, so they now realize thier immense vulnerability. What is more worrying is that while 90% of the countries would have required the vaccine to "clean-up shop", India at this phase is like the Americans in that they need to use the vaccine to bend the curve.
China's vaccines on the other hand have done quite well, even today, Joao Doria of Sao Paola state was saying that preliminary results are good, and also the 3 chinese vaccines are in testing across about 20 countries now. The chinese vaccine pipeline is undoubtedly the strongest in the world, both being the furthest ahead as well as having deployed the broadest portfolio from mrna, recombinant vector, to inactive whole virus. If the world truly devolves to "vaccine diplomacy", the Americans are going to have a tough time since they can't give Moderna/Pfizer to the Indians when they have thier own people to vaccinate first.
I think Wang Yi should communicate to the indians that both sides should pull back and as a further confidence-building measure, china is willing to offer vaccines to India (maybe the first 100 million doses for free). If they don't agree, chinese press should just leak the proposal online, and make the indians look petty. A propaganda victory at this point is more important than a military victory, which will surely be achieved.
But there's a limit to propaganda. At some point the masses will realize their priorities.
Heard from multiple Indian co-workers who have family in India that the COVID situation in India is significantly more dire than the public data shows and how the Indian media currently portrays it. A combination of poor hygiene, inadequate healthcare system and corruption is causing COVID to spread like wildfire, especially in rural areas. No one knows what the true infection / death rate is because rural areas are unaccounted for.
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