Sino-US Relations: Strategic Perceptions

-Snehalata Panda, Reader, Behrampur University


The prime determinant of China's foreign policy during the Cold War being the relation between two superpowers, an immediate concern for it was the difficulties it faced in reconciling itself to the changing international scenario following the military success of the United States in the Gulf war and the shape of the world which emerged after it. It realistically assessed that the failure of the Communist governments was due to their failure on the domestic front which should not happen to China by reversing the reform process initiated by Deng Xiaoping. Therefore, it continued the reform programme by prioritising economic development and strengthening the institutions of socialist democracy. The strategy it has followed to overcome its diplomatic isolation by drawing closer to the countries of Asia has its genesis as much in its aspiration to emerge as a potential power as in the US policy towards China after the military crackdown on the Tiananmen student uprising of 1989. This conflict soured Sino-US relations which took a further downturn due to the US perception of China's human right records, trade deficit, sale of arms and its aggressive posture towards Taiwan. Ever since, China has tried to improve its relations with the US and also with the Asian countries with the objective that the emergence of multipolar centres of power and growing regional tension with no superpower to support would be conducive for it to emerge as a potential power capable of discouraging hegemonism. This paper draws on the wealth of insight of the policy of cooperation and competition characterising Sino-US relations since 1989 and attempts to identify their strategic perceptions in the emerging world system.

Sino-US Economic Interests

Economic interest is paramount in Sino-US relations, each having the common perception that domestic prosperity is essential for exerting influence in the international arena. Immediately after establishing diplomatic relations with China in the year 1979, the US signed its first trade agreement, the base of which was mutual granting of Most Favoured Nation (MFN) status, the first of such status granted to any Communist country outside the General Agreement on Tariffs and Trade (GATT). This status favoured China with exporting goods to the US at the lowest tariff rates applied to US imports. But the MFN status was put under annual renewal. China was required to adhere to the specific requirements of the US Trade Act of 1974 for consideration for renewal of MFN. Moreover, this was linked to certain domestic policies of China and was subjected to annual concurrence by the US Congress. Despite these provisions, the US never withheld renewal of MFN status during 1980-89. But after the Tiananmen incident and the increasing trade deficit1 the US Congress opposed renewal of MFN and resolved for evaluation of China's human rights record before granting MFN status. President Bush, however, overcame the opposition of the US Congress by renewing MFN, but regarding its extension, opinion in Congress was divided, one favouring revocation and the other conditional extension of MFN. As a matter of fact, MFN status became the principal ploy in US policy towards China by linking with it other issues like violation of Intellectual Property Rights (IPR) by China. The Tiananmen incident was the turning point in the US policy towards China, as it viewed the suppression as intolerance of democracy and disrespect for opposition in China. George Bush had a different approach based on moral and political considerations, rather than economic, that was constructive engagement, which implied that the US would use diplomatic tools carefully to maintain its vital trade interests. US interests included democratisation of Chinese polity, respect for human rights, adherence to international norms on sale of military equipment, fair trade practices and cooperation with China to achieve regional stability. Bush declared that he was "trying to chart a normal course through a world of lessser evils" and announced on May 27, 1991, that the US would continue China's trading privileges for another year. But new restrictions were imposed on technical exports. His policy contained a measured mixture of engagement and sanction.

In 1989-90, China was placed in the "priority watch list" by the US which in 1991 became a target priority foreign country for investigation of China's practice relating to IPR under the special 301 provision. The Chinese copyright law enacted in 1991 fell far short of international standards as pointed out by the US. But China retaliated by stating the difficulties faced by a developing country in complying with all the norms set by the US. In 1992, trouble started regarding imposition of sanctions affecting an estimated $700 million worth of China's exports following which China agreed to join the Berne Convention and enact extensive legislation to protect intellectual property. In the memorandum of understanding (MOU) signed between the US and China, the latter agreed that the provisions of the Paris Convention and Berne Convention relating to the protection of intellectual property would prevail over China's domestic legislation. China was required to provide foreigners with a higher standard protection imposed by the Berne Convention.2

Another issue which created problems, was the "export of convict labour product," by China. US law allows for such labour with certain restrictions but after the Tiananmen incident, the US took a rigid stand on goods from China manufactured by prison labour. In 1991, the US customs service announced that it would hold up all shipments of certain goods produced by at least four Chinese factories which employed convict labour. Legislations were enacted in the US Congress in order to block import of such products and to sue suspected Chinese convict labour facilities to ensure that prison labour is not employed for the manufacture of goods meant for export. In October 1991, China introduced a law banning export of prison goods. But the US was not satisfied with the steps taken by China and in September 1992, Bush signed an MOU on the prison goods issue, which required China to release suspected political prisoners. Though initially hesitant, China agreed to the US proposal of inspection of its prison labour facilities, which was a "rare instance of China backing off from its long proclaimed principles of inviolability of its sovereignty."

Problems also cropped up in China's textile exports to the US through third countries after the expiry of the multifibre agreement signed between China and the US in 1990. In May 1992, a US Federal Court filed a suit against three Chinese companies and four Chinese officials in the US for alleged fraudulent import of Chinese textiles. Investigations were also carried out and arrest warrants were issued. China rectified these allegations by introducing legislation, and in 1991, the bilateral trade agreement between both the countries was extended for another two years. China conceded most of the objections raised by the US relating to IPR and outlawed exports of compact disc (CD) presses without the approval of the Press and Public Administration of China. Approval of the National Administration became necessary for contracts to produce foreign titles. Several CD factories were closed but some of these were allowed to reopen after obtaining proper licensing. It allowed foreign recording companies to licence their entire repertoires of artists to Chinese companies by formulating a new policy which allowed overseas recording companies to sign and promote rock stars and opera divas within China. The Chinese action repaired the diplomatic breakdown with the US and its MFN status was extended.

But the US based Asia Watch reported on February 20, 1994, that 1993 was the worst year for political arrests and trials in China since the Tiananmen suppression in 1989. The report came amidst intensive US scrutiny of China's human rights record and continuance of normal trade relations. China alleged that the US too violated human rights, though in a different way but "China was picked up for imposition of trade sanctions" and that the "US is not really trying to safeguard human rights but wants to trample on international norms under the excuse of human rights to subserve its hegemonistic policies in foreign affairs." US pressure on China to release political dissidents was denounced by China as "irresponsible interference in China's internal affairs." It refuted the Asia Watch report of February 20, 1994, and the Foreign Ministry reiterated that China enjoyed political stability and a booming economy.3

In 1994, relations between the US and China indicated appreciable improvement. The US described its policy towards China as "comprehensive engagement" and delinked the human rights issue for annual extension of MFN status, lifted sanctions imposed on China for missile sales to Pakistan, and established a military to military relationship which was scrapped after the Tiananmen Square incident. But increasing trade deficit troubled the US as it rose from $30 billion in 1994 to an estimated $39 billion in 1995. Threats in the form of violation of IPR and lack of transparency of trade deals were again brought to the fore by the US. China's entry to the World Trade Organisation (WTO) was blocked mainly because of its trade deficit with China, particularly in manufacturing and textiles.

Despite a seemingly inexorable downward spiral in Sino-US trade relations, China could export more goods to the US. Economic interests were paramount for the US for renewal of MFN status. The Clinton Administration visualised that the US economy would improve by developing closer ties with the Asia-Pacific region, more precisely by providing more jobs to the Americans at home. The sturdy Chinese economy would ameliorate the increasing unemployment problem in the US. China too is not impervious to US necessities and its domestic prosperity. When renewal of MFN drew close, China convinced the US by sending a huge business delegation and invited US firms to invest in China, which indicated China's acumen in working at the accurate level of power in the US. Despite all these constraints in US-China economic relations, bilateral trade between both the countries has increased rapidly. A major contributor to this increase being Hong Kong, as Chinese products, including Hong Kong and Taiwan products, were exported to the US on an unprecedented scale, compared to US exports to China.

In the Nineties, "Greater China" which includes China, Hong Kong and Taiwan, is emerging as a powerful trading bloc. Sino-US trade relations are not based on bilateral issues but include Taiwan and Hong Kong, and US interests beyond trade in Hong Kong and Taiwan are virtually linked to China. Therefore, it has to ultimately deal with "Greater China" and any punishment to China by revoking MFN status will adversely affect long-standing US allies; i.e. Hong Kong and Taiwan. More often than not, MFN status has been extended under pressure from these two countries. Besides, Bush's policy of constructive engagement aims at integrating China into the international market and providing jobs4 to the people in the US. The Chinese market figures prominently in the US business policy making circles. In the post-Cold War period, political considerations have prevailed less over economic considerations in determining the relation between nations.5 These considerations have compelled the Chinese economy to open up and abide by US pressure to adhere to international norms.

The Taiwan Issue

The most intriguing factor in Sino-US relations is the recent development in US-Taiwan relations. The grant of visa to Lee Teng Hui by the US was a major breakthrough in the relations between the two countries after the diplomatic breakdown in 1978. Following this, the zig-zag course through which Sino-US relations moved since 1989, became more complicated when China reacted by postponing the impending visit of its Defence Minister, Chi Haotian, to the US and cancelled working level discussion on ballistic missile proliferation. It also refused its consent to the appointment of former Tennesee Senator, Ames Sanes, as the US Ambassador to China. Even though the US has assured that Lee's visit did not reflect a shift in its policy, the Chinese leaders perceive the US action as "reversal of the one China policy" and "an escalation of US containment strategy designed to deny it a rightful status as a major power." China has also disbelieved the present Taiwanese leadership which it alleged is exploring all avenues for "de jure sovereignty" and creating international opinion in favour of remaining separate under the guise of "diplomacy of private visits."6

The resentment of the Chinese government over Lee's visit to the US has deeper roots dating back to the framework of integrating Taiwan with China worked out by Deng Xiaoping, that is "one country two systems," whose application formed the basis for the arrangement with the US and Portugal for the integration of Hong Kong and Macao with China. The "sacred historical mission" of uniting Taiwan with the mainland originates in the Maoist strategy to consolidate Communist rule and resist imperialist hegemony in territories belonging to China. Ever since the establishment of the Taiwan office in the state council in the early 1970s, China has vigorously pursued7 its objective which was further quickened after 1991 by regular contacts between both countries at the non-governmental level. Taiwan's response to the Chinese gesture indicated a positive change when President Lee signed a document in April 1991, declaring the end of the "period of mobilisation for the suppression of the Communist Rebellion" which brought to an end the forty-year-old civil war between the Kuomintang government of the Republic of China (Taiwan) and the Communist Party ruled People's Republic of China. Following this, President Lee officially accepted the Chinese Communist Party (CCP) led government in China, but at the same time made it clear that his government has not given up the "One China Policy and the condition for unification on the basis of liberal democratic policies." The ending of the "Period of Rebellion" also terminated the "temporary provisions" and incorporated several changes in the Taiwanese Constitution. The strengthening of its relations envisages reunification of China under the "one country two systems" principle which implies that Taiwan will retain its autonomy but under the territorial jurisdiction of the PRC. In a White Paper published on August 31, 1993, China made its basic position on reunification clear by reiterating "peaceful reunification under one country two systems," that is, there will be one China of which Taiwan will be an inalienable part. Self-determination for Taiwan was ruled out but the political and economic systems of Taiwan were to coexist with those of China notwithstanding the fact that one is capitalist and the other Communist. China would allow comparatively more autonomy to Taiwan than to any of its other autonomous regions by allowing Taiwan to have its own administrative and legislative powers, an independent judiciary, right of adjudication on the island, political party, freedom to enter into commercial and cultural agreements with other countries and to retain its own military. Moreover, Taiwan would be represented in the central government of China.

Chinese leaders are working upon accomplishing a historical fact that "the territory inherited from the ancestors should not under any circumstances become smaller." Taiwan being part of Chinese territory, will not remain separate and any such attempt by the present Taiwanese leadership has been seriously viewed by China. To materialise this historical fact, China has ambitious plans of joining Taiwan, Hong Kong and Macao with the mainland. China will not hesitate in taking recourse to military action if Taiwan persists in pursuing its independent existence and strives for international recognition. In the 1990s, the priority area of the Chinese government is the unification of Taiwan with China. The Chinese Communist Party issued directions to all sectors of Chinese society and government to work unitedly towards achieving this historical mission of unification, but Taiwan8 is not interested to accede to China's proposal--rather it has insisted upon a separate state character, never to be subordinated to the PRC.9 It has cultivated friendly relations with several countries having diplomatic relations with China and quite a few countries have appreciated the economic development of Taiwan in a free democratic political system. There is a basic difference between the Chinese perception of its power and role in the post-Cold War period and that of Taiwan. The latter claims legitimacy of its international status due to its economic power and democratic political system. It perceives that democracy, freedom and market trends have prevailed over the socialist economic system by outperforming them in the global competition. "Beijing asserts its legitimacy on the basis of its status as China's national government while Taipei claims legitimacy through its membership in a new world order, based on market, economic co-operation and democracy."10

Taiwan does not believe that the Cold War tactics used by China would be relevant in the post-Cold War world system. Its desire to rejoin the UN and become a member of the WTO contradict China's perception of Taiwan as an inalienable part of the PRC. Taiwan is working hard to strengthen its informal relations with other nations through "active involvement in global society and promotion of wider transnational relationship." The conflict between Taiwan and China "revolves round the customary norms of recognition, sovereignty, statehood firmly adhered to by China and evolving interdependence model followed by Taiwan." China's two track policy vis-a-vis Taiwan, that is befriending for its economic self-interest and, at the same time, ensuring that it would not countervail China's regional dominance, is similar to the one followed by the US to contain China's regional hegemonism but engage in economic interdependence. China has thwarted every attempt made by Taiwan to gain diplomatic leverage in the UN, the US and other countries of its choice. Its increasing militancy towards Taiwan in settling the unification issue is replete with contradictions. The differences in Taiwanese and Chinese perceptions lie in the fact that the former perceives the problem as "diplomatic" whereas the latter claims it to be internal which does not warrant interference from foreign countries, particularly the US.

The US has played the Taiwan card to subserve its own interest. The location of Taiwan has given a strategic advantage to the US to limit China's power by restraining it from using it as a naval base. A more disturbing issue for the US is China's growing economic power, which will increase further in the next century when Hong Kong will accede to China in 1977 and Macao in 1979. After Taiwan becomes a part of China, its economy will be massive in size, challenging US power. Therefore, the US is supporting Taiwan so that it will not be dependent on China while, at the same time, trying to convince China that its support to Taiwan is not a deviation from its "one China policy." The "duality is evidenced in permitting President Lee to enter the US but not extending an official reception, supplying defensive weapons but not offensive ones, encouraging Taiwan to be active in international institutions but obstructing its entry to the UN and sending aircraft units but not supporting its military expansion." It is obvious that the US does not want its influence to wane in this region and, therefore, it is playing one country against the other so that none could challenge its hegemony.

China's Perception as a Superpower

China's robust economy, its military capability, attempts to become a regional power and perception that it is the only country in the post- Soviet world to challenge US hegemony indicate its aspiration to be a superpower. After the Tiananmen incident, it was widely presumed that China would backtrack from the reform programme due to the dominance of the conservative leaders. Forces of reaction and reform were struggling for supremacy and the old guards of the command economy were trying to tighten their hold. They were not in a mood to comply with the conditions put forth by the US even at the cost of a downturn in the relations between the two countries. But the entrepreneurial class consisting of the collective private and foreign enterprises have accounted for its 60-65 per cent Gross National Product (GNP) whose influence is too strong to be ignored by the leadership. Any attempt to reverse the reform programme would be adversarial for the Chinese economy. The present leadership in China is not burdened with ideological constraints but endowed with better technical training. They are less capable of imposing their ideas as Deng or Mao did but have made greater effort in making a bargaining relationship with the conservative leaders in order to achieve the reform objective.11 The reform programme has received wider support as it has facilitated development and improved the standard of living of the people. China's strategy of reform is working successfully which is evident from its success in the high-tech area, defence, space technology and the like. China has made a spectacular effort to catch up with the new technological revolution12 in the world in a system of planned economy and operation of market forces. It has attained a standard almost equal to that of the developed countries in the manufacturing of bombs, hydrogen bombs, satellites, space rockets, and has launched more than 30 satellites. China's approach to development is based on its basic goal of strengthening the country economically and militarily. Its policy lays stress on the utilisation and application of high technology to improve traditional products and enhance the comparative strength of manufactured goods in the world market. Under the HTR programme of 1988, it has emphasised commercialisation of certain sectors like biotechnology and space technology. The torch programme emphasised commercialisation of research results to achieve which Chinese goods were required to compete in the international market. This is the reason why China has concentrated on developing export oriented enterprises since the inception of the programme.

In the post-Cold War period, China's diplomatic strategy aims at coping with the monopolar power of the US, and to overcome its diplomatic isolation after the Tiananmen incident. The easing of trade relations between both the countries is a poor indicator of their improved relations which apparently are more competitive rather than cooperative. Consistent emphasis on improving human rights was a major determinant in China's search for allies in the Asia-Pacific region, the West European countries, South Asia and Latin America. Since 1990, Sino-Japanese relations have shown considerable improvement. Japan has welcomed a friendly China for its economic and strategic reasons. It has moved closer to the Association of South-East Asian Nations (ASEAN) and signed a treaty with Vietnam and Myanmar. The verbal accord with Vietnam was the initial step for settling its claim on the Spratly Islands with Malaysia, Indonesia, Brunei, Philippines and Taiwan and also for solving its dispute with Japan over the Titaoyuta Senkaku Islands in the South China Sea. Its relations with North Korea have put it in an advantageous position so far as the US-North Korea dispute over the North Korean nuclear installations is concerned. With the dismemberment of the Soviet Union, China perceives it has the potential to counter US hegemonism and, at the same time, emerge as a regional superpower. Even though it has repaired its diplomatic damage with the economic giants of the region it would not like any one of them to be independent centres of power so that they could, independently or in cooperation, challenge its regional hegemony. The Chinese strategy vis-a-vis its neighbours is likely to be a two-track one--"China trying to befriend them directly and, at the same time, ensure that they are regionally counterbalanced."13

The disintegration of the former Soviet Union has created a new balance of power in Asia. Eastern Asian countries see that the US is the only country "able to fill a strategic vacuum which might otherwise be filled by local ones." Besides, the US is the vital trade and investment partner for many East Asian countries. Their growing friendship is guided by economic interests. Most of the East Asian countries being rich with larger trade surplus where the US is struggling to compete, it will not overburden its budget with heavy defence expenditure on its military base in the East Asian region. Under the circumstances, China has calculated that in future, the US military presence will be reduced which will draw it to be a guarantor of security in this region and mediate in sorting out regional differences.

China also perceives that in the post-Soviet world system, the constituents of the former Soviet Union will not be able to sell arms mainly due to the inability of their market components to pay cash for such deals. On the other hand, the market share of the US will increase in the days ahead in this region.14 Thus, in the present perspective, the major responsibility for arms transfers will rest on the US but it will not be able to carry on its trade without the cooperation of China as China has a prospering defence industry which even during the Cold War period had 5.8 per cent of the market share whereas the US had 35 per cent of the market share. China accounts for 6 per cent of arms sales to the states of Asia-Pacific. Its arms sales to North Korea and Pakistan have disturbed the US so much that it has linked its trade relations with sale of arms by China. Reports of the sale of15 missiles to Pakistan have been seriously viewed by the US for probable destabilisation in the regional balance of power. The vacuum created by the Soviet Union will be filled by China which in consequence will increase the defence budget of the Asia-Pacific countries. Besides, China's claim to some islands in the South China Sea will enhance the financial allocations for defence of the countries involved in the conflict over the territory. During 1987-1991, 46 per cent of China's total export of weapons was to the Asia-Pacific states. In 1991, China marketed $1,127 billion worth of arms which was 9.6 per cent of the total market share. China is in an advantageous position because of enhanced defence allocations in these countries and also few competitors for its market.16

China rejected a US proposal to detarget missiles aimed at each other's territory unless there was a no-first use declaration. The US has an enormous nuclear capability, about 7,000 warheads which is far more in number compared to China.17 China knows that the US would achieve diplomatic mileage both at home and abroad by arriving at such an agreement. It perceives itself to be the only power to challenge the US despite the fact that the US nuclear capability is superior. It has declined to join the disarmament process until the US and Russian arsenals are reduced to the level of China's. China's style of dealing with the US so far as disarmament is concerned is to lay down conditions which would be unacceptable for the US. Strangely, however, the US has shown interest in transfer of civilian nuclear technology to China, so also Canada and France, which indicates that China will have more nuclear leverage vis-a-vis the US and ultimately rise to a "second ranking power in the world." Both China and the US know that possession of nuclear weapons is essential for projection of power. In the process US policy makers are projecting China as the second ranking power in the world18 which is in consonance with China's perception as a superpower.


Quite a few Chinese leaders are critical of US policy due to the increasing socio-political problems arising from unresolved structural issues. Even the pro-reform group has expressed serious concern about the potential consequences of domestic political and social problems arising from China's external relations. The conservatives view that the basic motive behind US policy of stabilising its relations with China is to topple the Communist government as it did in the former Soviet Union and the Eastern bloc of European countries. According to them, it is a new hegemonism, a reflection of the nature of imperialism and capitalism in foreign policy and international relations. The ultimate objective of the US is to implant Western values in China by laying stress on improved human rights and democratisation of its political system. In achieving its objective, it has been consistently pressurising China to democratise its political system. The support of Japan and the West European countries to the US policy is termed by them as "bloc hegemonism."19 The hardliners are rigid in their stand in countering the US offensive of "peaceful evolution" by campaigning against the US policy of trade linked sanctions and sabotaging Chinese political and economic structures. While they recognise the importance of economic development for peaceful evolution, they argue that the political and ideological campaign against "peaceful evolution" should be equally important as a key to characterise the Party's basic line.20

It is firmly believed by them that there is not much change in the post-Soviet international system so far as the mechanisms of diplomacy are concerned. It is still the "real politics" which characterises the relations among nations and the key to understand world politics is "power and interest." Values like human rights and democracy are superfluous basing on which power composition in the post-Cold War period can be analysed. The extremists among them view that new conflicts among nation states so far suppressed in a bipolar world system have come to the fore which forebodes a situation similar to that preceding the World Wars. In the post-Cold War period, conflicts of national interest will be more frequent and intense. The expansionist objectives of the United States will get sustenance as much from the increasing conflicts among nations as they will from the enormous military and technological capabilities of the US coupled with its social cohesion and political stability.21 The difference in the perceptions of China and the US is that the former does not accept that the post-Cold War international system is characterised by a monopolar power concentration in the US.22

The US policy towards China is "engagement" which harbours containment of China's hegemonistic ambition potential enough to challenge the US claim of a unipolar world. Opinion on "unipolarity" in the post-Cold War international system is divided in China. Those who believe in the multicentric power system perceive that the Asian and European economic giants do not have the military potential to dominate world events but would influence the US by working with it in cohesion rather than challenging its power. US policy would be more realistic, keeping on top its national interest. Domestic problems will not be viewed independently from those of its foreign policy. It is obvious that change in power configurations will generate conflict but the US would prefer China to be a major trade partner and strategic ally. US policy makers have taken stock of the potentiality of "Greater China" which includes Taiwan, Hong Kong, Macao and Singapore with an overwhelming Chinese population and unusual degree of interaction among the people. The "bamboo network" transcends national boundaries with business executives, traders and financiers of Chinese origin located in Malaysia, Thailand, Indonesia and the Philippines who have made significant contributions in the development of the Chinese economy. The Chinese based economy has resisted global recession and comparative figures of GDP growth between the US, Japan and Greater China show unusual increase during the period 1987-91. Interaction between the PRC and Taiwan23 is increasing despite their political differences. South China has become one of the power houses24 of Asia due to the investment and expertise flow from Hong Kong. Cumulative direct investment from the newly industrialised countries viz Taiwan, Hong Kong and Singapore has surpassed that of Japan and the US in the countries of the South-East Asian region like Indonesia, Malaysia and Thailand.25 The US sees China both as an ally as an adversary, a people to be helped and feared, as potential customers and competitors, as strategic partners and expansionist aggressors.26 More precisely, US policy towards China is to act in concert in areas where they agree to foster greater consensus and to prevent minimum conflict where they disagree. China, however, is not convinced about US policy which it perceives as targeted towards containing Chinese expansionism. To deal with the US, China has befriended those countries which either are at odds with the US or potential strategic adversaries.27 A significant development in late 1996 was a closer relationship between Russia and China, specially in the areas of trade and defence which would act as counterweight for the increasing predominance of the US in world affairs. But, at the same time, to maintain global balance of power, China has to use its strategic leverage to check the growing power of Japan and also Russian expansionism.

China's hegemonistic ambition will be challenged by Taiwan and other countries in the South-East Asian region who prefer Japan to China for solving their strategic and domestic problems. But China would prefer the US to be dominant in this region to prevent Japan from becoming an arbiter in this region. If the US pursues its hegemonistic intentions, China itself will try to fill the vacuum. China is troubled by the unpredictable situation in Central and East Asia which might restrain it in emerging as a major power by threatening its security. Its enhanced defence allocation is precisely aimed to countervail such a situation. Chinese leaders are aware of the inevitability of interdependence in the present world system which China could hardly escape. US policy will be both idealistic as well as realistic and aimed at involving in world events which perhaps would not be adversarial for China. The US would not like China to collapse28 as the former Soviet Union did because that would create more problems instead of solving any. China would also not alienate the US by indulging in activities detrimental to US interests. To subserve its own interest, it is not unlikely that China would concentrate on the ideological differences between the two countries in assessing its relations with the US. But, at the same time, both will be accommodative and cooperative and their policies will be designed to cope with the exigencies of domestic as well as international realities.



1. Since 1990, US imports from China have increased beyond expectation. They were as high as 27.5 per cent which was the record growth maintained for the last eight years. Simultaneously, US exports to China came down, which accounted for 10.3 per cent US trade deficit with China," New York Times, May 4, 1991.

2. Joseph T. Simons "Improving Protection of Intellectual Property," China Business Review, March-April, 1992.

3. China's GDP grew by 11.2 per cent in the first quarter of 1995. Foreign exchange was $58 billion. Its trade surplus was $7.08 billion and exports increased by 62 per cent during the same period. In 1996, its economic growth outstripped the target of 8.0 by an estimated 9.7 per cent rise.

4. "Clinton sees Asia Exports as Key to Jobs," New York Times, November 20, 1993, p. 6.

5. "Failure of Policy in China Reflects Miscalculations," Asian Wall Street Journal, June 6, 1994, p. 2.

6. Strong business contacts, however, have not eased the complexity of relationship between "economic interdependence and political interdependence" indicating that China will not be able to achieve its objective easily.

7. In 1979, China took the initiative by publishing a message to end military confrontation, strengthen trade relations, and reunify territories. In 1984, China put forth the proposal of "one country two systems" for reunification.

8. See Hu Chang, "Impression of Mainland China Carried Back by Taiwan Visitors," in Roman H. Myers ed., Two Societies in Opposition: The Republic of China After Forty Years (Stanford, California: Hoover Institution Press, 1991).

9. On September 5, 1995, President Lee Teng Hui delivered a conciliatory speech to repair the damage in Sino-Taiwanese relations but the Financial Times commented that Lee's effort was a "tactical manoeuvre rather than a fundamental change in policy."

10. George T. Yu and David J. Longenecker "The Beijing-Taipei Struggle for International Recognition," Asian Survey, vol. XXXIV, no. 4, April, 1994.

11. The decadel development programme for 1991-2000 drawn up by the state council of China as per the proposals put forward by the Central Committee of the Communist Party has targeted to quadruple the GNP by 2000 as compared with the figures for 1980 by achieving a six-point annual growth within the parameters of a planned economy. The twelve points incorporated in the programme lay emphasis on developing socialist planned economy and political structures empowering the Communist leadership, which indicates that China is not plunging into radical reform of its political institutions but lays stress on economic development by improving the performance of its existing system.

12. In the areas of electronics, space, precision machinery, etc. China has achieved remarkable success after the high-tech research and development programmes were incorporated in 1987-88. In the areas of aviation and aerospace, microelectric technology, photoelectronics, telecommunication engineering, ocean science, automation technology, precision instruments, etc. its success is evident from the value of output amounting to RMB 76 billion which was 4.8 per cent of GNP for that year. Quin Shijun, "High Tech Industrialisation in China: An Analysis of Current Status" Asian Survey, vol. xxxii, no. 12, December 1992.

13. K. Subrahmanyam, Times of India, October 24, 1996.

14. SIPRI Yearbook, (Oxford: Oxford University Press, 1992).

15. China disagreed with the US objections that the sale of arms has violated the MTCR which prohibits the transfer of missiles delivering 500 kg payload to a range of at least 300 km. But the range of the M11 is 290 km. Later, however, China agreed that the inherent capacity of the missiles rather than demonstrated combination of range and payload should be the factor determining the prohibition under the MTCR.

16. China is troubled by the unpredictable situation in the Central Asian countries, their defence capabilities which might restrain it from emerging as a major power.

17. Bloc hegemonism is characterised as follows: "Military force as a backing, trade as a bait and human rights as a stick flagrantly interfering in other country's internal affairs and exporting the capitalist system as well as values."

18. Jianwef Wang and Zhiminlin, Asian Survey, vol. XXXII, no. 10, October 1992.

19. The US power has not declined in absolute terms because of the hard capacity (basic resources, economic, military and technological power) and soft capacity (political stability, educational level, cultural tradition and social cohesion). "Establishing a Just and Reasonable international Political and Economic Order," People's Daily, July 17, 1991 cited in Danwee Wang.

20. China backtracked on its earlier stand that it would join the disarmament dialogue if US and Russia reduce their armaments.

21. Angus Foster, "Bitter Enemies Become Grudging Partners" Financial Times, November 13, 1992.

22. Louis Kraar "A New China Without Borders," Future, October 5, 1992, p. 1224-125.

23. The total size of its economy will be equal to that of the US or Western Europe by the year 2000. Robert S. McNamara, "A New International Order and its Implications," cited in Murray Weidenbaum, Washington Quarterly, Autumn, 1993.

24. Nancy Dernkapt Tucker, "China and America, 1941-1991, Foreign Affairs, vol. 70, no. 5, p. 75.

25. View of US Assistant Secretary of State, Winston Lord.

26. Issues like violation of IPR, human rights, blocking China's entry to the WTO, frequent contact with the Dalai Lama and policy towards Taiwan are some of the irritants in China's feelings about US policy.

27. Ibid.

28. The basic US perception is that "China is too big to punish and too important to isolate." William Perry while recognising China as a great power laid stress on "engaging China and deal with it on issues that are important not only to the security of the United States but also to the whole of the Asia Pacific region," Times of India, December 11, 1996.