CHina is set to impose export restrictions on rare earth minerals, gallium and germanium. US Treasury Secretary Janet Yellen said in Beijing, America will not compromise on national security. India’s former foreign secretary says Beijing should stop looking at relations with India through American prism. Taiwan will open a new office in Mumbai. chinascope Tries to read between the lines to understand China and the world.
China in a week
Beijing has decided to ban the export of two important rare earth minerals used in the manufacture of semiconductor chips, gallium and germanium, from August 1. The decision is being seen as a response to the United States’ move to unite its companies and allies to restrict the sale of high-end semiconductor chips to China, affecting the latter’s businesses.
Chinese state media left no room for any speculation, blaming the US for the semiconductor sanctions.
“It is they who challenge the world supply chain, and the blame that belongs to them should never be placed on China as it is protecting its own legitimate national interests in this uncertain world,” Said an op-ed in China Daily,
So far, most of the world’s semiconductor companies – including Taiwan Semiconductor Manufacturing Co. Ltd. – have done so Said That Beijing’s sanctions will not affect their business significantly.
In addition to semiconductor companies, German automaker Volkswagen has Said The minerals are needed for the autonomous driving function of their cars, the company is assessing the impact of export controls.
Clearly, Beijing has finally decided to use tit-for-tat retaliation by playing the rare earths card – an option discussed during the Donald Trump administration in 2019.
US, European and Taiwanese semiconductor companies will likely start obtaining the two rare earth minerals from other sources – which could be more expensive. We can’t yet say exactly how the disruption will affect the cost of semiconductors, but a boom is expected.
Beijing would like Washington to ease its restrictions on high-end chips, but US Treasury Secretary Janet Yellen, who was in China this week to deliver the message, indicated the US would not back down.
Regarding China’s restrictions on rare earth minerals, Yellen said, “We are still evaluating the impact of these actions, but they remind us of the importance of building resilient and diverse supply chains.”
Beijing timed the announcement just before Yellen’s visit to signal that China would not take it quietly.
Yellen’s 10-hour talks in Beijing over two days yielded no significant breakthroughs other than a promise of further talks – much like Antony Blinken’s recent visit.
During her visit, Yellen met with the new Vice Premier of China, He Lifeng, who replaced Liu He as the Economic Emperor. Yellen said the visit opened a channel of communication with China’s new economic team under He Lifeng.
After meeting with Yellen, He Lifeng admitted to the Chinese spy balloon incident hurt relationships with America.
He Lifeng said, “Unfortunately, due to some unforeseen events, such as the incident involving the airship, there were some problems in the implementation of the consensus reached by the two heads of state.”
Yellen’s message was that the Joe Biden administration would continue to impose national security-driven restrictions on technology access ahead of the election. US wants to ‘reduce risk’, not ‘isolation’ Yellen Said,
Meanwhile, Rumors Spread Yellen has made three on Chinese social media the demands: China bought $850 billion in national debt, rolled back anti-sanctions measures and pledged not to stop supporting Russia. Users alleged that Yellen had come to beg for the purchase of US Treasuries, a domestic popular narrative that was promoted on social media.
These rumors are in line with China’s domestic narrative, but the reality is that Beijing finds itself in a corner due to US sanctions.
With a contradictory expression of unease on his face, President Xi Jinping virtually attended the Shanghai Cooperation Organization (SCO) meeting hosted by India on July 4.
SCO member states displayed their differences as India refrained from supporting the China-led Belt and Road Initiative (BRI). But Beijing made two achievements at the cost of India’s SCO chairmanship.
China urges other member countries to support BRI include Xi’s policy rhetoric by referring to ‘building a community of shared destiny for humanity’ in the joint statement.
New Delhi may be happy that they can host the SCO while keeping distance from Beijing’s agenda, but Xi has managed to comfortably fit his ideas into the SCO joint statement. Needless to say, despite the inclusion of Iran as a new member, the future of the SCO is in a bit of trouble.
It is not every day that a former Indian diplomat speaks openly at a geopolitical event in Beijing. Former Foreign Secretary Shyam Saran joins 11th Speaking at the World Peace Forum, he said, “I don’t think we should always look at India or India’s foreign policy only from the perspective of China-US relations. India has far more interests than choosing to ally with the United States, China or Russia.” during an interview with beijing dailySaran spoke of Beijing looking at relations with India through an American prism.
To convince China that otherwise may be possible, Prime Minister Narendra Modi’s state visit to the US adds to Beijing’s skepticism about the growing friendship between India and the US.
Saran’s comments got lost in the fast pace of geopolitical developments.
Read also: China’s new foreign affairs law says it will target India if relations deteriorate
China in world news
Taiwan is set to open a new representative office in Mumbai. According To your Ministry of External Affairs. Taiwan opened its first representative office in Chennai in 2012.
Ashok Kantha, former ambassador to China, pointed out that Beijing, by and large, understands India’s Taiwan policy has been “pragmatic and transparent”, and India is not deviating from its “Big China Policy”.
Ambassador Kantha says Taiwan’s Mumbai office is unlikely to have any differences with Beijing as economic ties with India have their own logic.
Chinese state media has yet to comment on the development.
India’s Ambassador to Taiwan Gauranglal Das will Quick Leave your post in August. The next appointment will be tasked with maintaining the momentum in India-Taiwan relations. India has decided to go its own way on Taiwan by not following the high-optic support offered by the US and the EU. Beyond politics, the economic fundamentals of India-Taiwan relations have only grown stronger.
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The author is a columnist and freelance journalist. He was previously China media reporter with the BBC World Service. He is currently a MOFA Taiwan Fellow based in Taipei and tweets @aadilbrar. Thoughts are personal.
(Edited by Prashant)