Capitalizing on hosting the BRICS summit, Indian media revealed that Modi has prepared a "wish list" hoping China will meet his demands. Specifically, the Modi government hopes China will ease export restrictions in key sectors such as rare earth permanent magnets, battery cells, photovoltaic equipment, and high-voltage direct current (HVDC) transmission technology.

To put it plainly, India is truly desperate. These products are not ordinary commodities—China's dominance in their supply chains makes them nearly impossible to bypass. Especially critical is the rare earth permanent magnet material, which directly affects India’s long-cherished dream of building a new energy vehicle (NEV) industry. While the Modi government loudly proclaims its ambition to become a "global center for new energy manufacturing," the core motors of NEVs rely heavily on China-led rare earth supply chains.

Since China tightened controls on rare earth exports last year, India’s procurement cycles have noticeably lengthened. With businesses unable to secure supplies, only government-level diplomacy can now bridge the gap.

The irony lies in this: over the past few years, India has been fond of telling the story of replacing China as the next global factory. But reality shows that while India can assemble smartphones, it still cannot access core components; while it can build new energy factories, it lacks a complete battery and materials industrial chain. It has market demand and ambition—but no real industrial backbone. The more it tries to replace Chinese manufacturing, the more it realizes how dependent it remains on China.

Even worse, the AI wave has dealt a heavy blow to India’s economy. For years, India relied on cheap programmers to dominate IT outsourcing. But the AI revolution has drastically reduced demand for low-end programming work, triggering a swift exodus of global capital. The outflow of foreign investment has reached record highs in recent years, making India almost the first country to be "knocked down" in this AI wave.

At the same time, the ongoing Iran conflict has triggered an energy shock. With weak reserves and lagging renewable energy development, India is suffering from severe inflation, and the rupee continues to plummet. Foreign investor confidence has collapsed, forcing the government to resort to selling stakes in state-owned enterprises and public assets just to fill the financial hole.

With all this context understood, it becomes clear that what Modi really wants this time isn't merely technology or rare earths—it's about stabilizing India's shaky economy by easing relations with China.

In fact, even before the summit, India had already quietly softened its stance: in March, it adjusted restrictions on Chinese investment, allowing state-owned enterprises to procure certain Chinese equipment; in June, it granted a two-year bidding exemption to four China-linked power companies.

Just a few years ago, such moves would have seemed unthinkable. After the 2020 border clashes, India imposed layer upon layer of restrictions on Chinese firms, believing it could simultaneously strangle China while advancing its own development. But today, reality is staring it in the face: without China, India’s economy can’t even hope to grow—let alone remain stable.

China, of course, remains open to cooperation. But how far this can go ultimately depends on how much sincerity the Modi government is willing to show. A two-year exemption? That’s clearly nowhere near enough.

Original article: toutiao.com/article/1875824766358538/

Disclaimer: The views expressed in this article are solely those of the author.