Soldiers dying at the border; India borrows money from Chinese bank?

Modi govt confirms India took loans totalling Rs 9,202 crore from Beijing-based bank, even as India-China border standoff was escalating

India China

While the phrase “soldiers are dying on the border” is the right wing troll’s best non-abusive defence against any fact checks they are confronted with, even they are at a loss of words for now. News is coming in that India finalised a loan agreement with the Asian Infrastructure Investment Bank (AIIB) for $750 million (Rs 5,521 crore) soon after the Galwan Valley massacre. The loan, reported The Telegraph, was finalised to “support measures undertaken under the Pradhan Mantri Garib Kalyan Yojana (PMGKY)”. China, is the largest shareholder in the Beijing-based multilateral development bank.

The explosive news report by The Telegraph lists this dateline that reveals the shocking chronology:

June 15: Chinese troops kill 20 Indian soldiers in the Galwan Valley.

June 19: India signs a loan agreement with the Asian Infrastructure Investment Bank (AIIB) for $750 million (Rs 5,521 crore) to support measures undertaken under the Pradhan Mantri Garib Kalyan Yojana (PMGKY). 

July 29: India bans 59 Chinese apps, much to the delight of the right-wing cheerleaders, or as the Telegraph put it in the now famous meme content supplied by a TV anchor “the sheer suddenness of the move, the unexpected nature of the move, the unpredictability of the move”.

However, just as sudden is the confirmation by the Narendra Modi government that India took “two loans totalling $1,350 million (Rs 9,202 crore) from the China-controlled bank in the thick of the border standoff.” As the Telegraph stated, “There is nothing wrong in taking loans from the AIIB, especially because India is the second largest shareholder in the bank after China. Neither can the objective be faulted: the assistance was accessed for accelerating India’s Covid social protection response programme.”

However, the government should now explain how “delinking the government’s financial transactions from bilateral tensions goes against the Centre’s policy of cracking down on Chinese business relationships in India”. All this while the “Indian external affairs ministry has been asserting that it cannot be business as usual in the face of Chinese attempts to unilaterally change the facts on the ground along the border”, reported the news.

Of course the confirmation of these loans also exposes the Modi government’s “strong economic counter-measures against China” as well as the Make in India, boycott Chinese goods, fuelling the “Aatmanirbhar Bharat campaign.”

Meanwhile, Union Defence Minister Rajnath Singh hinted in Parliament that a ‘strong warning’ had been issued to China, even as India wants a peaceful resolution of the India-China border issue. “The House can be assured that we remain prepared to deal with all contingencies,” he said in the Lok Sabha on Tuesday, reported NDTV.

Singh then took to social media to share his statement and request that the Lok Sabha pass a resolution as well, “I would like to urge this House that we should pass a resolution that we stand step by step with our brave soldiers, who, regardless of their lives, are subjected to adverse circumstances at the height of the peaks of the country. Despite protecting Mother India: Defense Minister



His words were stern, “We have told China through diplomatic and military channels that the attempt to change the status quo unilaterally is not acceptable in any case.” And the soldiers were invoked, “Our brave soldiers sacrificed their lives but at the same time caused heavy damage to the Chinese side and managed to protect their border.”



However, as Telegraph reported, “on June 19, four days after the Galwan massacre in which China also suffered unspecified casualties, India signed the $750-million loan agreement with the AIIB to tide over the coronavirus crisis.” This was the day Prime Minister Modi had made the “no-intrusion” claim.

It adds that on May 8, when the first reports of Chinese incursions at multiple points in eastern Ladakh had begun coming in, and were largely ignored by the Indian government, another loan of $500 million had been taken from the AIIB to fight the pandemic back home. The loan details were confirmed in a written answer in Parliament on Monday by junior finance minister Anurag Thakur.

According to The Telegraph, Thakur in his written reply to questions asked by BJP MPs Sunil Kumar Singh and P.P. Chaudhary in the Lok Sabha, said: “The government of India has signed two loan agreements with the Asian Infrastructure Investment Bank under Covid-19 Crisis Recovery Facility. First loan of USD 500 million was signed on May 8, 2020, to partly support ‘India Covid-19 Emergency Response and Health Systems Preparedness Project’ to respond to the threat posed by pandemic and strengthen the national health system for preparedness.”

Thakur added in his written reply that “the second loan of USD 750 million was signed on June 19, 2020, as budgetary support to government of India for accelerating India’s Covid-19 Social Protection Response Programme in order to support measures undertaken under Pradhan Mantri Garib Kalyan Yojana (PMGKY), the benefits of which have also flown to states/UTs,”.

The Telegraph details that the AIIB, a multilateral development bank to improve social and economic outcomes in Asia and beyond. India is among the founding members of the AIIB. China is the largest shareholder with 26.61 per cent voting shares, followed by India with 7.6 per cent.


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