Chinese wave an olive branch at India -- and India waves back

China and India are taking tentative steps toward closer economic and political relations. "We do detect a thawing and a willingness to talk and be friendly," noted a high Indian official.

India would like to normalize further its economic and political relationship with China. Indian Finance Minister R. venkataraman explained his position to the Monitor while here for the annual meeting of the Asian Development Bank.

This development, if it continues, could be a geopolitical shift of major importance. The world's two most populous nations have been antagonists at least since 1962, when they fought a bitter border war.

Moreover, India has a treaty fo friendship with the Soviet Union, China's archenemy, and buys much of its weaponry from the USSR. Considering these factors, there was much interest in New Delhi when Chinese

Vice-Chairman Deng Xiaoping last month waved some olive branches at a visiting Indian parliamentarian, Subramanian Swamy.

Mr. Venkataraman seemed willing to continue that reconciliation, noting there is potential for more trade between India and China which India would welcome.

At the moment Sino-Indian trade is small. Some Indian government trading bodies have visited the Canton trade fair and won small contracts. But there have been few other business contracts.

Finance Minister Venkataramindicated that India would like to learn some of China's superior agricultural practices. He thought China could learn from India's intermediate technology and small-industry development. China might also benefit from India's plentiful supply of skilled technicians.

"We are certainly willing to share this technology with them," the white-haired former Indian planner said. "There is good scope for exchange."

Even should Sino-Indian political and economic relations strengthen, India and China seem bound to continue as economic rivals. Foreigners have long made comparisons in progress between India taking the democratic route to development and China the authoritarian path.

Considering the much greater diversity of religion, language and culture in India, such comparisons are not entirely fair. Nonetheless, the Indians themselves make such comparisons.

They noted that China, with about 50 percent more population than India, grows some 300 million tons of food grain per year compared with 130 millions tons for India. China mines 600 million tons of coal, India 100 million tons. China produces 110 million tons of oil, India only 14 million tons.

"China has an energy per capita production four times ours," noted Mr. Venkatarman.

India's per capita output is estimated at $190 per year. China's per capita output used to be put at some $400 per year in the World Bank's atlas of such numbers. But with China joining the World Bank and making more statistics available, there have been tentative proposals to reduce China's per capita figure to $270 per year.

China's industrial capacity is higher than that of India and apparently has been growing somewhat faster, the Indian officials said. China's manufacturing sector is also a larger proportion of gross domestic product.

The Chinese, it was pointed out, are a nuclear power and have an intercontinental ballistic missile capacity.

However, the Indians believe their heavy electrical industry and some other sophisticated technological industries are ahead of the same industries in China. Moreover, the Indians are much further along in exporting their expertise through consulting and engineering firms, as well as in industrial contracting.

Mr. Venkatarman confessed disappointment at his nation's recent industrial performance. "Our industry has somewhat stagnated in the last one or two years. But we are trying to pull it up again," he said.

Industrial production declined 1.4 percent in the Indian fiscal year 1979-80 (ending March 31, 1980). It grew about 4 percent in the fiscal year just ended, but Mr. Venkatarman had hoped for a stronger snapback from the recession. He regards the current fiscal year as a "test" of industry's recovery ability.

Agriculture did much better, with output of food grains running about 132 to 133 million tons, compared with 109 million tons in the drought year 1979-80. "It bounced back in a big way," the finance minister noted. With some 70 percent of India's people dependent on agriculture, the farm situation is all-important to India -- Just as it is in China.

A new area of rivalry between China and India will be a competition for loans from the World Bank. Now that China joined, it is seeking financial help for various projects.

Despite such continued rivalry, reports from New Delhi have it that China has been telling india for some time now that the two nations face similar problems, that they have no issues of world policy in conflict, and stand to gain equally through cordial relations.

Further, Mr. Deng remarked to Indian parliamentarian Swamy, "India is no longer a Soviet client state." Apparently the Chinese now feel that with the Soviet Union in Afghanistan, Indian public opinion regards the Soviets as too close for comfort and that this is now a factor in Indian policymaking.

In any case, Mr. Deng said he would be soon sending to New Delhi China's Foreign Minister Huang Hua. China called off a proposed visit Huang in 1980 after India announced recognition of the Vietnamese-backed heng Samrin regime in Cambodia. Dates for Huang's visit are now under discussion, the Indian Foreign Ministry says. There are reports from New Delhi it could take place as early as the end of this month.

The meeting, when it takes place, will be watched carefully by diplomats. Since the two most populous nations also have two of the world's largest armies, a true reconciliation will b e of major interest to both the United States and the Soviet Union.

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