The issuance of visas to Chinese nationals by India has significantly declined since the border clash at Galwan Valley four years ago, reflecting the Modi government's heightened focus on national economic security.
The Galwan clash on June 15, 2020, resulted in the deaths of 20 Indian soldiers, including Colonel Santosh Babu, as they resisted an attempt by the People’s Liberation Army (PLA) to encroach on Indian territory in East Ladakh.
Unspecified numbers of Chinese soldiers also perished in the skirmish.
Senior officials within India's national security and economic ministries revealed that around 200,000 visas were issued to Chinese nationals in 2019, before the pandemic and the Galwan clash.
However, this number plummeted to just 2,000 in 2024 after the government implemented stringent screening measures for Chinese investments in India.
In the past eight months, approximately 1,500 visas have been granted to Chinese nationals, with around 1,000 of these issued to meet the demands of the Indian electronics industry.
An additional 1,000 visas are under consideration, primarily for the electronics sector, following intensive vetting.
Despite efforts to reduce economic dependence on China, the trade deficit between the two nations remains substantial. In the first five months of 2024, the deficit exceeded $38.11 billion, with India exporting goods worth $8.93 billion to China and importing $47 billion in return.
This imbalance persists despite government initiatives such as reducing corporate income tax and launching a ₹2 lakh crore production-linked incentive (PLI) scheme in various sectors to boost domestic production.
The Indian electronics industry has voiced concerns about potential job losses due to the restricted issuance of visas to Chinese workers and businesspeople.
Nonetheless, official data from June 14 indicates a 9% annual increase in India's merchandise exports for May 2024, driven by petroleum products, engineering goods, and electronics.
The PLI scheme has notably contributed to this growth, with electronic goods exports reaching $29.12 billion in FY 2024 compared to $23.55 billion in FY 2023.
Post-Galwan, the structural screening of Chinese investments has uncovered violations by companies such as Vivo.
The Enforcement Directorate (ED) has accused Vivo of laundering approximately $13 billion back to China to evade Indian taxes and violating visa conditions for its executives and workers.
Vivo, in response to the ED’s actions, issued a statement expressing concern over what it termed continued harassment and legal uncertainty within the industry.
Amid calls from Indian industry for more visas for Chinese technicians and workers, the national security establishment and economic ministries remain steadfast.
They assert that visas will only be issued after thorough vetting to ensure compliance with travel conditions, as unregulated issuance could undermine India's "Atmanirbhar Bharat" initiative and impact domestic manufacturing.
India-China bilateral relations have been strained since the PLA's transgressions in May 2020. Despite multiple rounds of military and diplomatic talks, the PLA has yet to de-escalate and restore the status quo ante along the Line of Actual Control (LAC) in East Ladakh.
Four years post-Galwan, the Chinese military maintains a robust presence in the region, with additional reserves stationed in the hinterland.
The Indian Ocean Region (IOR) also remains tense, with Chinese surveillance ships and naval forces frequently deployed.
On Thursday, the Chinese ballistic missile tracker Yuan Wang 7 was spotted 1,000 kilometres south of Kanyakumari, while PLA Navy anti-piracy forces operated in Djibouti, the Gulf of Aden, and the Madagascar channel.
A senior official highlighted that with the Xi Jinping regime maintaining pressure on India both on land and at sea, the Modi government has no choice but to reduce economic dependence on China.
"India’s national economic security cannot be compromised for a few pieces of silver…. Visas will be issued for Chinese technicians and businessmen only after screening with assurance that travel conditions will not be violated,” a Cabinet minister stated.
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