China Quote✒️
“China is developing a new generation of long-range bombers, likely named the H-20 which could have more than 10,000km range (about 6,214 miles)”, “enabling the [PLA Air Force] to cover the second island chain and into the western region of the Pacific” which may debut sometime in the next decade,” China Military Power Report, 2024.
Reinvigorating Dialogue: India and China Initiate Measures to Address Boundary Disputes and Fortify Bilateral Relations
Written By Manashjyoti Karjee, Security & Society Researcher
The 23rd meeting of the Special Representatives (SRs) of India and China over the border issue was held in Beijing on December 18, 2024. This is an advancement in the restoration of bilateral relations between the two neighbouring countries after years of tension. Mr. Wang Yi, a member of the Political Bureau of the Communist Party of China Central Committee and Minister of Foreign Affairs, represented China, while Mr. Ajit Doval, National Security Advisor, represented India. This dialogue, the first structured meeting in five years, demonstrates both nations’ commitment to resolving intricate border conflicts and cultivating stable ties.
The SR mechanism was established in 2003. This has functioned as the primary foundation for addressing the enduring border issue between India and China, which extends 3,488 km. The military standoff in Eastern Ladakh in 2020, along with the deadly Galwan Valley clashes in June of that year, exacerbated tensions between the two nations. The disengagement agreement of October 2024, which addressed the last two areas of dispute at Demchok and Depsang, facilitated fresh negotiations. The resolution to assemble the SRs was reached at a conference between Indian Prime Minister Narendra Modi and Chinese President Xi Jinping at the BRICS summit in Kazan earlier this year.
The conference produced six points of consensus, illustrating the mutual intent to resolve the border problem while preserving wider bilateral relations. These included:
- India and China underscored the need of preserving peace along borders to prevent boundary disputes from hindering the overall advancement of bilateral relations. They commended the settlement of border-related matters, including the execution of the October 2024 disengagement agreement, and promised to enforce compliance via military and diplomatic measures.
- The SRs reiterated their commitment to achieving a fair, reasonable, and mutually acceptable resolution to the border issue, according to the political principles set down in 2005.
- Additionally, all parties agreed to enhance border management protocols, augment confidence-building initiatives, and attain enduring peace and stability.
- Agreements were established to recommence Indian pilgrimages to Kailash Mansarovar, enhance data sharing on trans-border rivers, and restore commerce via the Nathu La Pass.
- Moreover, the SRs underscored the need for enhanced coordination in military and diplomatic engagements. The Working Mechanism for Consultation and Coordination on China-India Border Affairs (WMCC) was assigned the responsibility of implementing decisions and ensuring compliance.
- In addition to the border problem, the summit discussed bilateral, regional, and global matters of shared concern. The negotiating parties underscored the significance of stable and predictable India-China relations for regional and global peace and development. Mr. Wang Yi said that robust relations between the two nations, as representatives of the Global South and developing economies, serve the interests of their collective population of 2.8 billion and further the broader movement of South-South cooperation.
The time of the meeting is crucial. The discussion underscored the need to align bilateral ties with the strategic objectives of national leaders. Informed by the difficulties of 2020, all parties acknowledged the significance of long-term views and mutually beneficial cooperation in restoring trust and fostering collaborative prospects. This occurs when both nations reassess their foreign policy in response to evolving geopolitical factors, including challenges to multilateralism and a changing global order. By prioritising dialogue, India and China demonstrate a realistic understanding of the interdependence necessary for regional stability.
Notwithstanding the excitement around the conference, problems persist. The border dispute persists, stemming from historical claims and divergent interpretations of the Line of Actual Control (LAC). Agreements must be executed efficiently, particularly in high-tension regions. Moreover, the profound distrust engendered by the events of 2020 requires sustained confidence-building initiatives. The extensive bilateral partnership also encounters difficulties. Although commerce between the two nations has rebounded, some facets of collaboration remain constrained. China’s expanding influence in South Asia, coupled with India’s apprehensions over China’s strategic alliances in the area, has intensified tensions.
Conclusion
The 23rd meeting of the Special Representatives represents a significant milestone in the restoration of India-China ties. By prioritising a comprehensive strategy for addressing the border issue, enhancing cross-border collaboration, and promoting regional stability, both nations show a commitment to guiding their ties towards a more stable and productive trajectory. The efficacy of these initiatives will depend on the authenticity of their execution and the readiness of both parties to prioritise enduring strategic benefits above immediate nationalistic tendencies. As the two nations ready themselves for the next round of SR discussions in India, their capacity to sustain momentum while tackling fundamental concerns will be pivotal in shaping the future of one of the globe’s most intricate bilateral relationships.
Economic Activity🏦
China plans record budget deficit of 4% of GDP in 2025
Reuters reports that Chinese leaders plan to raise the 2025 budget deficit to 4% of GDP, the highest on record, up from 3%. This decision aligns with “proactive” fiscal policies to counter U.S. tariff threats under President-elect Trump. China will maintain its 5% growth target, fund stimulus via special bonds, and adopt a looser monetary stance to boost economic stability amidst domestic and external pressures.
China’s Unemployment Rate Among Youth Drops for Third Consecutive Month
The Global Times reports that China’s youth unemployment rate for those aged 16-24, excluding students, fell to 16.1% in November, marking the third consecutive month of decline. This improvement reflects the impact of government pro-growth policies and a recovering economy. The broader urban unemployment rate also stabilised at 5%, among the lowest levels this year. Authorities emphasised continued efforts to stabilise employment and boost incomes.
Inside China🐉
Xi Jinping Visits Macau to Mark 25 Years of Chinese Rule
Nicoco Chan and Tyrone Siu write in Reuters that President Xi Jinping visited Macau for the 25th anniversary of its return to Chinese rule, highlighting its stability and loyalty under “one country, two systems.” Xi emphasised economic diversification beyond gambling and attended the inauguration of new Chief Executive Sam Hou Fai. The visit highlights Macau’s role in China’s Greater Bay Area strategy and as a bridge to Portuguese-speaking nations.
Premier Presides Over State Council Study Session
China Daily reports that Premier Li Qiang presided over a State Council study session on December 16, focusing on improving administrative law enforcement standards. He called for tighter procedures, enhanced discretion benchmarks, and reforms to regulate business-related enforcement in 2025 to foster a fair market environment. Li emphasised institutional improvements and safeguarding public and enterprise rights to boost market confidence and competitiveness.
China and the World🌏
Vietnam-China MoU on Smart Border Gate, Upskilling and Infrastructure
Samaya Dharmaraj writes in OpenGov Asia that Vietnam and China have strengthened bilateral cooperation with a focus on smart border gate initiatives, vocational training, and socio-economic projects in northern Vietnam. The MoU signed in Lang Son aims to modernise infrastructure, streamline trade, and develop workforce skills, enhancing cross-border logistics and regional connectivity. Both nations stress sustainable growth, technological integration, and inclusive development in less-urbanised areas.
Yang Tengbo: Who is alleged Chinese spy linked to Prince Andrew?
Frances Mao writes in BBC News that Yang Tengbo, a Chinese businessman banned from the UK on national security grounds, allegedly leveraged relationships with Prince Andrew and other UK figures for potential Chinese interference. Authorities cited links to Beijing’s United Front Work Department and suspicious documents. Yang denies being a spy, claiming the ban reflects strained UK-China ties.
Bangladesh Looks to Buy J-10 Jets from China
Dylan Malyasov writes in Defence Blog that Bangladesh is reportedly considering purchasing 16 J-10C fighter jets from China as part of its air force modernisation programme. This follows Air Marshal Shaikh Abdul Hannan’s visit to China. The J-10C’s advanced technology, proven operational track record in Pakistan, and China’s delivery efficiency make it a practical choice amidst Western and Russian supply constraints.
Pentagon Report: China to Build 1,000 Nukes by 2030
Paul McLeary writes in Politico that China is on track to amass 1,000 nuclear warheads by 2030, having added over 100 to its stockpile this year. The Pentagon’s annual report highlights China’s advancements in missile survivability, naval strength, and fifth-generation fighter production, alongside increased defence spending. Despite military growth, corruption and logistical issues continue to hinder China’s global power projection.
US Probes China-Founded Router Maker TP-Link on National Security Fears
The Straits Times reports that the US has initiated a national security investigation into TP-Link, a dominant router supplier in the US market, due to concerns over potential threats to data security. The probe, prompted by bipartisan lawmakers, scrutinises TP-Link’s alleged links to Chinese state-backed cyberattacks and its market dominance achieved through low pricing, echoing the “Huawei playbook.” TP-Link denies complicity and highlights restructuring efforts to distance itself from Chinese origins.
How China Recruits Private Security Guards for Overseas Missions
Intelligence Online reports that private security personnel protecting Chinese interests globally face demanding roles, including overseas placements and rapidly shifting assignments, often for low wages. These guards are recruited to serve Chinese companies under the Belt and Road Initiative, with a stringent selection process to meet the CCP’s growing security needs abroad.
New York Man Pleads Guilty in Chinese ‘Secret Police Station’ Case
Channel News Asia reports that Chen Jinping, a 61-year-old New York resident, pleaded guilty to conspiring as an unregistered foreign agent for China. Prosecutors accused Chen of running a “secret police station” in Manhattan’s Chinatown to assist Beijing in targeting dissidents. Chen admitted to removing online content critical of the station. Co-defendant Lu Jianwang denies similar charges. The case highlights US efforts to curb “transnational repression” by foreign adversaries like China.
China wins $202M excavation contract in Riyadh as Saudi construction booms
Melissa Hancock writes in Semafor that China Harbour Engineering Co. has secured a $202 million contract for the second phase of Saudi Arabia’s $62 billion Diriyah project. The contract highlights China’s growing presence in Saudi Arabia’s booming construction market, as the kingdom prepares for major events like World Expo 2030 and the 2034 FIFA World Cup.
Tech in China🖥️
China’s GenAI Sector Sees More Funding, Fewer Deals in Sign of Consolidation
Ben Jiang writes in the South China Morning Post that China’s generative AI sector secured 35 billion yuan in funding this year, a sharp rise from 20.5 billion yuan last year, despite a 23% drop in deal numbers. This reflects increased selectivity by investors amid market saturation. Leading start-ups like Zhipu AI and MiniMax attracted nearly half of the total funding, underscoring sector consolidation and heightened competition.
ByteDance’s Doubao AI Model: 85% Price Cut Amid Fierce Competition
Ben Jiang writes in South China Morning Post that ByteDance has intensified the generative AI market competition in China by slashing the price of its Doubao model to 0.003 yuan per thousand tokens, 85% below the industry average. This aggressive pricing aligns with growing demand, evident from a 33-fold surge in Doubao usage since May. With capabilities in visual understanding and reasoning, Doubao targets sectors like education, logistics, and e-commerce, positioning ByteDance as a leader in China’s AI race.
Alibaba to sell department store unit for $1.3b loss
Retail Asia reports that Alibaba will sell its Chinese department store chain, Intime, for $1.02 billion (7.4 billion yuan), incurring a $1.3 billion loss. The sale is part of Alibaba’s restructuring efforts, focusing on its core e-commerce business amidst rising competition from rivals like Pinduoduo and ByteDance’s TikTok. Alibaba acquired Intime in 2017 for $2.6 billion.
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