I Overview

China:

  • Government Work Report presented at Two Sessions
  • Foreign Minister Wang Yi holds press conference during the Two Sessions. Talks about India – China Relations
  • China’s Military Budget to reach $229 billion in 2022
  • China’s position on Ukraine issue

Japan:

  • Japan expresses concern about China’s military build up
  • Japan imposes more sanctions on Russia
  • Former PM Shinzo Abe makes some critical suggestions post Ukraine crisis
  • Japan PM Kishida visited India on 19 – 20 March

South Korea:

  • Yoon Suk-yeol elected New President of South Korea
  • PM Modi holds telephone conversation with Yoon Suk-yeol, President-elect of South Korea
  • Omicron hits South Korea badly

North Korea: 

  • North Korean missile explodes over Pyongyang

Taiwan: 

  • Taiwan Central Bank to raise interest rates from March
  • Taiwan to launch satellites from 2026​​​​​​

II Developments in China

Government Work Report presented at Two Sessions


The annual meeting of China’s Parliament – the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) which is an advisory body commenced on 4 and 5 March respectively and ran for a week. Premier Li Keqiang presented the Government Work Report to the NPC, the highlights of which were – 

a.    Anti pandemic rules will continue in force in China.
b.    GDP growth target for this year is 5.5%
c.    Over 11 million new urban jobs are to be created
d.    Urban unemployment rate not to cross 5.5%
e.    CPI increase to be limited to 3%
f.    Grain output of over 650 million metric tons
g.    Stable foreign trade and greater use of foreign investment
h.    Negotiate high standard FTAs
i.    Defense expenditure to increase by 7.1%
j.    Continue innovation driven development strategy
k.    Promote the Global Development Initiative

Having stable growth in the economy and in incomes is important in this landmark year of 2022 which is to see the holding of the 20th Party Congress in October/November where General Secretary Xi Jinping is working to get a third term in office. 

Foreign Minister Wang Yi holds press conference during the Two Sessions. Talks about India – China Relations

As has become standard operating procedure, Foreign Minister Wang Yi addressed the media during the Two Sessions. He answered a whole range of questions on Ukraine, Russia, United States, EU, Japan, Central Asia, ASEAN and their relations with China. There was nothing new or novel. The PTI correspondent was permitted to ask a questions on India – China relations in answer to which Wang Yi stated, “recent setbacks do not serve the interests of both countries”. He called for ties to “move forward on the right track”. Wang said “let’s be partners for mutual success rather than adversaries for mutual attrition”. Both sides should not let boundary issues interfere with the rest of the relationship. Here too, China is sticking to its position where it wants the leeway to do what it wants on the border while ensuring the rest of the relationship does not get impacted. India cannot let that happen. Our position as articulated on several occasions by our EAM is that what happens on the border does determine the rest of the relationship. 

China’s Military Budget to reach $229 billion in 2022

The Government Work Report projects China’s defense budget to rise by 7.1% this year and defense spending to hit US $ 229 billion. This is second only to the defense spending of the United States. Most experts agree that there are also other parts of the budget of China’s central government which can also be considered defense related and hence this figure itself is an understatement. The increase in China’s defense spending is the highest in three years.

China’s position on Ukraine issue

Foreign Minister Wang Yi expounded on his government’s position on Ukraine stating that Beijing would play a “constructive role in calling for negotiations” while refusing to condemn Moscow or call its actions in Ukraine an “invasion”. He was at pains to distinguish between the situation in Ukraine and that of Taiwan, saying that the island is recognized as a part of China whereas the problems in Ukraine are between two countries – Russia and Ukraine. Incidentally, at the United Nations China has abstained on votes in the UN Security Council as well as the General Assembly, very like India. China maintains that the sovereignty and territorial integrity of all countries should be respected and protected; China advocates common, comprehensive, cooperative and sustainable security; the current situation is not what China wants to see; China supports all diplomatic efforts aimed at a peaceful settlement of the Ukraine issue; the UN Security Council should play a constructive role in resolving the issue. 

III Developments in Japan

Japan expresses concern about China’s military build up


Expressing “strong concerns” about China’s military build up,including the recent announcement of a 7.1% increase in military spending in 2022, Japan has urged China to be more transparent in this matter. Japan’s Chief Cabinet Secretary has said that unilateral use of force to change status quo seen in Ukraine should not be tolerated in the Indo-Pacific region. There is rising concern in Japan that China will see the Russian case as permission for its own invasion of Taiwan. 

Japan imposes more sanctions on Russia

In line with other G-7 nations, Japan too has enhanced its sanctions on Russia to include banning export of oil refining equipment and expanding the list of entities facing asset freezes. Japan has not only frozen assets of Putin but also excluded seven of Russia’s banks from the SWIFT global payments network. 

Former PM Shinzo Abe makes some critical suggestions post Ukraine crisis

Former Japanese PM Shinzo Abe recently made some critical suggestions to enhance security in the Indo – Pacific including that Japan should host US nuclear weapons on Japanese soil. This is bound to create a furore in pacific Japan and lead to a national debate on the issue. He also said that the U.S. should clearly state that it would come to the military assistance of Taiwan if it was attacked by Beijing. Earlier he had already aired the view that Japan too must defend Taiwan militarily if it is attacked. These radical suggestions could not have been made while he was PM of Japan. China has reacted angrily to such suggestions.  

Japan PM Kishida visited India on 19 – 20 March

Japan’s Prime Minister Fumio Kishida undertook his first visit to India, as PM of Japan, on 19-20 March 2022 for the 14th Annual Summit between the Prime Minister’s of the two countries which has been on hold since 2018. Apart from a lengthy Joint Statement, the two sides signed the Memorandum of Cooperation in Cybersecurity, 7 JICA loans for various projects in India, some amendments to the Comprehensive Economic Partnership Agreement between India and Japan. A Memorandum of Cooperation on Decentralized Domestic Wastewater Management, an India – Japan Industrial Competitiveness Partnership Roadmap, an agreement on Sustainable Urban Development were also signed during Kishida’s visit. India and Japan also launched a Clean Energy Partnership as well as a Sustainable Development Initiative for the North Eastern Region of India. 
PM Modi spoke highly of the fact that the two governments had successfully implemented the 2014 – 2019 investment target of JPY 3.5 trillion as part of the Investment Promotion Partnership. The new target for the next five years was announced at JPY 5 trillion. 
The two PMs discussed the Ukraine issue as well as China. 
Overall, the visit must be seen in the context of strengthening India – Japan ties, a trend that has been in evidence over the last decade and more.  

IV Developments in South Korea

Yoon Suk-yeol elected New President of South Korea

South Korea’s 20th Presidential election was held on 9 March 2022. Yoon Suk-yeol of the People Power Party won the election with 48.56 % of the vote while the governing party’s candidate Lee Jae-myung came a close second with 47.83% of the vote. Overall, 77.1% of all eligible voters cast their ballot. Yoon will take office on 10 May and serve a single 5-year term as President of the Republic of Korea. The campaign was one of the most bitter in recent memory with the two main candidates mocking, slamming and demonizing each other. However, after the election Yoon proclaimed that it was time for national unity on which he places great emphasis. He also said that he would pay attention to people’s livelihoods and welfare. Yoon is a former graft prosecutor who helped imprison former President of Korea Park Geun-hye on grounds of corruption. With this election, the conservatives are back in the government promising to be a good member of the international community but likely to take a much harder line on North Korea.

PM Modi holds telephone conversation with Yoon Suk-yeol, President-elect of South Korea

PM Modi spoke on telephone on 17 March with South Korea President-elect Yoon Suk-yeol. Congratulating him on his election victory, PM Modi invited the President-elect to visit India at an early date. The two leaders discussed various sectors which offer potential for accelerated bilateral cooperation. They agreed on the importance of broadening and deepening the India – Korea Special Strategic Partnership. They agreed to jointly celebrate next year as the 50th Anniversary of the establishment of diplomatic relations between the two countries. 

Omicron hits South Korea badly

South Korea reported 407,017 new Covid cases on 18 March taking the case load for the country as a whole to 8.65 million. South Korea is just seeing the current Omicron wave of Covid infections peaking with new infections being 621,328 on 17 March, an all-time high. 

V Developments in North Korea

North Korean missile explodes over Pyongyang

A suspected North Korean missile launched on 16 March, appears to have exploded in mid-flight over Pyongyang. South Korea and the U.S. have warned that North Korea may be preparing to launch an inter-continental ballistic missile at full range for the first time since 2017. Such a launch would violate UN Security Council Resolutions. Debris is reported to have fallen in or near Pyongyang.

VI Developments in Taiwan

Taiwan Central Bank to raise interest rates from March

Taiwan’s central bank has announced that it will raise interest rates by 0.25 % from 18 March. The central bank’s discount rate will rise from 1.125 per cent to 1.375 per cent. This is being done as inflation has made an appearance In Taiwan also. 

Taiwan to launch satellites from 2026

Taiwan could start launching large satellites from 2026. Taiwan is hoping to construct a base in east or southeast Taiwan commencing 2024. 

 

The previous issues of East Asia Digest are available here: LINK

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(The views expressed are personal)
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About the Author

Ambassador Gautam Bambawale

Former Ambassador of India to Bhutan,
China and High Commissioner to Pakistan and Distinguished Visiting Fellow- AC

Ambassador (Retd) Gautam Bambawale was a member of the Indian Foreign Service from 1984 to 2018. He was India’s Ambassador to Bhutan, Pakistan and China.

Bambawale was stationed in Washington DC in 2004-07 during the Indo-US nuclear deal which transformed ties between the two countries. He has been India’s first Consul General in Guangzhou (China) 2007-09. He was Director of the Indian Cultural Centre, Berlin 1994-98.

Ambassador Bambawale worked in the Prime Minister’s Office 2002-04. At the Ministry of External Affairs he was Joint Secretary for East Asia from 2009-2014. Bambawale has dealt with China for 15 years of his 34 year diplomatic career. He is fluent in Mandarin Chinese and German.

Ambassador Bambawale is currently Distinguished Professor, Faculty of Humanities and Social Sciences, Symbiosis International University, Pune and teaches a course on Diplomacy and International Governance at the Symbiosis School of International Studies. He has an M.Phil. in Economics from the Gokhale Institute of Politics and Economics, Pune.