Plus big blockchain news and Chinese Central Bank's New Digital Currency
|Nov 3||Public post|
ChinaIndia Networked is a newsletter by me, Dev Lewis, highlighting the networked relationship between the two regions at the intersection of technology, society, and politics. I’m a Fellow at Digital Asia Hub and Yenching Scholar at Peking University, where i’m conducting research on the Social Credit System. Follow me on Twitter @devlewis18 or write to me at firstname.lastname@example.org.
Thank you to all those that wrote in response to issue #4 with comments—always encouraging to know people are reading, especially as I continue to play around with content and format (and publishing schedule). I’ve also had a lot media interest and comments on my case study on Social Credit Scores in China. If you missed it last time round you can read it here.
This week issue i’m delighted to share an exclusive excerpt from a new book ‘The Great Game in the Buddhist Himalayas: India and China’s Quest for Strategic Dominance’ by Phunchok Stobdan.
The book is a riveting historical to present day account of geopolitics in the Himalayas featuring characters that make for an epic thriller: imperial China, Mao, and Xi Jinping, The Dalai Lama, Tibetan factions, The British Raj, CIA, and India. Phunchok Stobdan, a former Indian ambassador and currently Senior Fellow at the Institute for Defence Studies and Analyses, is a native of the Himalayan region and a unique voice on the subject, informed by vernacular media sources and extensive visits to the region in official and unofficial capacity. Buddhism is what first truly networked China and India, and Tibet of course is a major political thorn between two governments. Living in China i’m regularly reminded by people of the Buddhism connection yet I grew up in India pretty ignorant about Buddhism and its global history. Its an area i’m always trying to beef up on, read on…
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🏔The Great Game in the Buddhist Himalayas: India and China’s Quest for Strategic Dominance by Phunchok Stobdan
Vintage by Penguin Random House India 2019
While India, America and the rest of the world broadly went by accepting the British idea of China’s political ‘suzerainty’ over Tibet, they failed to underpin the insight of the most dynamic spiritual nuances that had Tibet’s political ties intertwined with China.
This book does not intend to analyse the nature of the Tibet–China relationship—already the subject of a major propaganda war. But the two enjoyed a symbolic relationship that according to the Tibetans was more in the nature of priest–patron (cho-yon, or tanyue guanxi in Chinese) rather than a relationship of sovereign and subject. Tibetans also argue that their past submissions to the Yuan and Qing courts were more metaphysical than political, more symbolic than substantive.
The fact remains that the last Qing Empire (1644–1911) held complete spiritual, political and military control over Tibet. Even in the post-Qing period, for example, in the case of selecting the present Dalai Lama, the Tibetans directly or indirectly sought political and spiritual legitimacy from the central government in Beijing.
The Tibetans, though, omit or overlook the role played by the Kuomintang government in the selection of the present Dalai Lama, born in 1935. The Chinese have been arguing how Beijing authorized its envoy, General Wu Zhongxin, to supervise the process of search, confirmation and ratification of the present Dalai Lama that had been completed between December 1938 and February 1940.
This aspect of Tibet’s peculiar relationship with China had been known to British historians and experts, but the Americans who took over the mantle of Tibetan politics in the early 1950s fell short of understanding this rather intrinsic and inimitable proximity between the two.
Juxtaposition of American-style political logic on the metaphysically multifaceted value orientation of the region may have entailed a policy failure of great magnitude, in the case of Tibet at least. In fact, the cho- yon bond would have survived if China had not taken the course that it did since 1949.
The British seemingly learnt about Tibet the hard way from the nineteenth century onwards. A British army officer, Laurence Austine Waddell, studied Tibetan religious practices and published a book in 1895 titled The Buddhism of Tibet: Or Lamaism, with Its Mystic Cults, Symbolism and Mythology, and in its Relation to Indian Buddhism.
Waddell was a physician with the Indian Medical Service and served in India, China, Tibet and Burma. While in Tibet, he was shocked to find that the Buddhism he encountered there wasn’t a purely intellectual ‘philosophy’ but utterly a ‘degraded, superstitious’ form of ancient Indian Buddhism.
Early Western scholars like Waddell, therefore, studied Tibetan psychology more in the context of Lamaism—an institutionalized system of relationships between the people with their deities and demons through sacred rituals and use of violence. Politically, Lamaism was a political hierarchy run by landowning princely lamas through the system of tulkus or ‘dharma princes’. Generally, the tulkus were incarnated lamas but they can wield political authority to manage society and economy with complete religious sanctity, with people paying obeisance to the lama.
Since the time the Chinese communists took charge in Tibet, the exiled Tibetan has astutely modified the discourse by abandoning Lamaism to replace it with the more suitable scholarly phrase ‘Tibetan Buddhism’ as a new form of Tibetan identity more acceptable to the modern world. The Dalai Lama, for instance, describes Tibetan Buddhism as a ‘science of the mind’. There has been dialogue between the Dalai Lama and a group of Western physicists and philosophers taking place since the mid- 1990s. But that’s easier said than done. A majority of Tibetans still need a lama and they continue to practise Lamaism in some form or the other centred on the lama and not the Buddha.
Antipathy towards the British
The British learnt about the Tibetans and their Lamaist conception of loathing the Europeans rather early. Noted Tibetan scholar Dawa Norbu quotes from Sarat Chandra Das that Tibetan monks and officials had a terrifying image of the English and dreaded them as incarnations of lha-mayin (giants or anti-gods) who fought against lha gods.
Although they had some idea about the Phyiling (Englishmen) who had taken over the Himalayan estates of Bhutan, Sikkim, Ladakh, Kashmir and Nepal, they understood little about the nineteenth-century phenomenon of British imperialism and the wave of colonialism that had taken over much of Asia.
In fact, Tibetan antipathy for the British dated back to the eighteenth century, to when English soldiers had taken part in the 1791–92 Nepal–Tibet conflict. Even at that time, the Eighth Dalai Lama, Jamphel Gyatso, and the Panchen Lama were whisked away to safety from Lhasa. The conflict with Nepal was about a trade dispute, but Lhasa sought Chinese help. The emperor, Qianlong, then dispatched Commander Fuk’anggan and his troops to chase the Nepal forces until they reached Nuwakot and signed the treaty of Betrawati.
The 1791 Sino-Tibetan war against Nepal had in fact critically changed the status of Tibet under Chinese control. The Twenty- Nine Article Imperial Ordinance of 1793 by the Qing Empire envisaged the Dalai Lama’s authority to control border inspections and maintain communication with Peking. The ordinance issued by the Qing Empire also instituted the lot-drawing process using a golden urn to select the high Tibetan lamas.The Chinese then explained that the reincarnation system was to facilitate a man-made procedure in order to eliminate controversies and disputes over the selection of high lamas. The ritual involved the names of candidates written in the Manchu, Han and Tibetan languages to be placed in the golden urn.
The Tibetans argued that the real purpose was to allow the Qing emperors to control the selection process of top Tibetan and Mongolian lamas.
Tibet’s peculiar relationship with China could be underrated, and it was here that the British found it hard to deal with the Tibetans. As Dawa Norbu succinctly says, ‘When the British approach Tibet directly, the Tibetan authorities tend to hide behind the facade of Chinese imperial authority. On the other hand, when they were indirectly approached through the Chinese, the Tibetan authorities objected and refused to honour any Chinese orders.’
🇮🇳🇨🇳🇺🇸Will India work with the US to contain China?
This article, by Zhang Hualong (章华龙) the New Delhi correspondent for Shanghai-based Wenhui newspaper, was published on October 17 on think tank Liaowang (瞭望智库). Within 24-hours it collected almost 80k views. Not viral but noteworthy. A number of articles, including the ones I included in issue #4, bring up the uncertainty around India-US and rising tide of Hindu nationalism giving rise to a more muscly foreign policy. The article is fairly detailed and well explained, i’m translating some bits that I think stand out.
Noticing India warming to the Quad:
India’s attitude towards the Quad has changed dramatically. The quad is the United States’s key grouping to promote like minded (志同道合) countries (that have land/maritime territorial disputes with China) in the so-called Indo-Pacific region, born with a sword pointing in the direction of China and meant to be the core means of containing China's security architecture.
Unlike the United States, Japan and Australia, India has played it extremely cautious. Earlier, India not only refused Australia’s request to join the US-Japan-India Malabar military exercise at the Shangri-La Dialogue in 2018, Indian Prime Minister Modi made a clear statement, “India does not regard the Indo-Pacific region as a strategy. Or a club with limited membership. We can't think of it as being for any country."
Yet today, the Quad held its first ministerial meeting. From the outside looking in, the major change India, shedding its long-time cautious approach leading to an significant upgrade for this grouping.
Why the quad matters to India
The most crucial thing is that the Quad has the potential to become the main governance structure of the Indo-Pacific region in the future in order to check and balance the "expansion" of the Chinese navy imagined by the Indians. This is the primary reason why India has favored the mechanism in recent years.
In summary, in the forseable future, India is unlikely to signup to the US’s “battleship” and fight alongside the US, however, the Modi government’s policy is growing increasingly assertive and inclined towards “balancing” by continuously exploring the bottom line of other country’s foreign policy, and force more countries to pay attention to it’s (India’s) core interests and sensitivities.
note on the publication: Liaowang is set up by Xinhua news agency and one of 10 national high-level pilot think tanks. Technically it represents the official government view but unlike Xinhua seems to attract a younger audience.
🔥💸 Blockchain, says Xi Jinping and China’s Central Bank
On October 25 Blockchain made the headlines of government rags after a long time, quoting Chairman Xi extol the virtues of the technology while presiding over a group study session of the CPC Central Committee Political Bureau on the development and trends of blockchain:
“Strengthen basic research, upgrade abilities for original innovation, strive for China to be at the frontier of this emerging area, occupy the top position of blockchain innovation, and acquire industry superiority”.
That China thinks Blockchain is important is not new. What should we read from this latest meeting? A report on Wechat account 价值世界 explains:
“most cutting edge” “highest point” “new advantages”，these three words convey that in the space of blockchain competition China’s only has eyes for #1 spot.
Industry analysts say that this Politburo study session means that the central government attaches great importance to the future development of the blockchain at the policy level which will help clear the path for the development of China's blockchain technology and industrial innovation.
Zhongtai Research believes that this Politburo meeting has set “three highs” for blockchain:
First, the "high level": the Political Bureau of the Central Committee for the first time identified the "important breakthrough in independent innovation of blockchain core technology";
Second, the meaning of “blockchain+” to have a wide scope: highlighting the deep integration of blockchain with different entities, covering more than 20 major areas and supporting three important reforms;
Third, comprehensive industry supply chain promotion measures are the most “real/substantive”: covering all aspects of “basic research, personnel training, market, and supervision”, and it is expected that the entire industry chain will usher in new opportunities.
The same week Huang Qifan, executive vice president of the China International Economic Exchange Centre, in his address at a conference shared an update on the People’s Bank of China’s Digital Currency Electronic Payment (DCEP), the world’s first central bank blockchain based digital currency.
At present, the digital currency (DCEP) launched by China's central bank is a new encrypted electronic money system based on blockchain technology. DCEP will adopt a two-tier operating system. That is, the People's Bank will first convert DCEP to banks or other financial institutions, which will then be redeemed to the public. The significance of DCEP is that it is not a digitization of the existing currency, but to replace M0. It reduces the dependence on account linkage to make a transaction, which is conducive to the circulation and internationalization of the RMB. At the same time, DCEP can realize real-time collection of data such as currency creation, accounting, and flow, and provide useful reference for the formulation of money and the formulation and implementation of monetary policy. The People's Bank of China has been studying DCEP for five or six years, and I think it has matured. The People's Bank of China is likely to be the first central bank in the world to introduce digital currency.
Plenty has been written about the People’s Bank’s work on creating a digital currency which dates back as early as 2014, although details of DCEP are still limited. Whats the latest on RBI’s plans and research?
Tencent Policy Research Center released a white paper on Blockchain on October 21 carrying this graph that caught my eye.
China has nearly as many patents applications as the rest of the world combined. 2016-17 was the biggest growth spike (951 to 2111) which is also the period of peak crypto and ICO fever in China before being gutted with the ban on trade of cyptocurrencies and ICOs in September 2017. India followed suit in 2018.
According to a recent WIPO report China ranks #1 with 791 patent approvals (note the graph above is applications not approvals), India is ranked #6 with 67 patents. However, its questionable how much of a proxy for innovation patent numbers alone are. China has mastered the art of filing patents towards hitting government targets. That being said Alibaba Group and Ant Financial ranks 2nd globally among patent families with blockchain at the core of its fintech infrastructure. Coming back to the Politburo meeting on blockchain and what it may mean going forward, i’m reminded of Kaifu Lee likening the government to a head conductor when discussing its influence on China’s AI ecosystem. I’ll keep a look out for good articles in the future to translate for this newsletter.
One message is clear: bitcoin and cryptocurrency 👎🏼 industrial blockchain 👌🏽 . (Although that didnt stop speculators to pump up the price of bitcoin almost 30%).
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The views expressed in this newsletter are mine and not representative of Digital Asia Hub as an institution.