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China trying to encircle India via tech deals with neighbours: RAW [India Business] [Times of India]
[January 24, 2013]

China trying to encircle India via tech deals with neighbours: RAW [India Business] [Times of India]

(Times of India Via Acquire Media NewsEdge) NEW DELHI: India should counter China's move to build and run communication networks in its neighbourhood countries such as Nepal and Maldives, the telecom ministry and the national security establishment have cautioned, following an alarm raised by intelligence agencies.

The Research & Analysis Wing, India's external intelligence agency, raised an alarm in early December about China's growing partnerships in the region, which could potentially compromise the integrity of telecom and Internet communication between India and its neighbours.

The communications ministry now wants New Delhi to take up the issue with neighbouring countries and also make competing offers for technological expertise and financing.

In a December 10 note, R&AW reported that the Maldives foreign affairs ministry had approached China for "concessional financing" of $60 million from its Export Import Bank to develop the island nation's IT infrastructure. The agency also reported that Chinese telecom giant Huawei had signed an MoU to develop the IT infrastructure of Maldives under the 'Smart Maldives' project.

The development in Maldives come months after the agency had warned of a similar move in Nepal, where Chinese vendors Huawei and ZTE were installing next-gen networks for Nepal Telecom. India's security agencies suspect Huawei and ZTE of having close ties with the Chinese military. In a separate October 2012 report, the agency had also asked India to take counter measures after ZTE secured a $44-million deal to build four high-tech data centres for Nepal's privately held Ncell.

"It is further stated that China increasingly targeting nations in our immediate neighbourhood for IT co-operation is indeed a matter of concern. The proposed project is significant due to the fact that China can capitalise its influence over Maldives to utilise the latter's IT network once the project is implemented. The possibility of bugged equipment to monitor and intercept any communication between India-Nepal and India-Maldives through these co-operations cannot be ruled out," the agency has warned, according to persons who have knowledge of the communication.

Some analysts claim that China has a strategy of creating a circle of influence around India by setting up military bases, resupply and recuperating ports as well as listening posts in neighbouring countries -- the so-called 'string of pearls' strategy. The validity of this thesis is, however, hotly debated.

Earlier this month, the security wing of the communications ministry approached the Prime Minister's Office, Cabinet Secretariat, Joint Intelligence Committee, National Security Council Secretariat as well as the ministry of external affairs, proposing that India take up the matter with Maldives and request the government there for an amicable solution.

Intelligence agencies as well as certain segments of the government also want India to offer technological expertise and plan substantial investments in both Maldives and Nepal, so that traffic between India and these countries are handled through the equipment installed and commissioned by New Delhi.

The R&AW report on Maldives seeking Chinese funding comes just days after India's ties with the island nation nose-dived as the Waheed government terminated the $511-million contract given to the GMR Group for developing the Male airport.

Several media reports had quoted Indian government sources as indicating that China may be behind the move to terminate the airport deal. Last month, Maldives President Mohammed Waheed denied reports that China had nudged his country to expel GMR.

(c) 2013 Bennett, Coleman & Company Limited

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