By Minhaz MerchantWhat made China blink? Four factors.One, Prime Minister Narendra Modi’s unannounced visit to Ladakh last Friday made it clear to Beijing that India wouldn’t back down in the stand-off at the Line of Actual Control (LoAC).Two, National Security Adviser (NSA) Ajit Doval reportedly told China’s foreign minister Wang Yi on Sunday that if Chinese troops did not withdraw from encroached areas at the LoAC, India would not hesitate to use proportionate force to evict them.Three, Beijing knows that the imminent onset of winter in September when eastern Ladakh freezes up would make Chinese fortifications along the LoAC untenable. Four, the decision to shut Chinese firms out of India’s growing consumer market and infrastructure projects unnerved Beijing.Can China be trusted to keep its word? No. But India has several trump cards it can use if Beijing reneges — yet again — on troop disengagement.India has amassed nearly 50,000 soldiers at key pressure points along the LoAC backed up by tanks, howitzers, Apache attack helicopters and ground-to-air defence systems, not to mention fighter jets loaded with laser-guided missiles.Indian soldiers are battle-hardened after over three decades of fighting Pakistani proxy terrorism, constant ceasefire violations at the Line of Control (LoC) and debilitating insurgency in Jammu and Kashmir. In contrast, the People’s Liberation Army (PLA) hasn’t fought a war for 41 years. The last time it did, against Vietnam on its southern border, it was humbled.Except a handful of senior generals now in their early 60s, not a single PLA soldier has seen battle. In a limited military conflict with India on mountainous terrain, PLA would be at a severe disadvantage. Indian soldiers have held on to the Siachen Glacier since they drove Pakistani troops and irregulars off it in 1984. For the Indian Army, the heights of eastern Ladakh in winter hold no fear. China, of course, presents a long term threat. Former defence minister George Fernandes was right in 1997 when he said China, not Pakistan, was India’s ‘enemy number one’. China abets Pakistan’s terrorism. Beijing shields terrorists like Jaish-e-Mohammed (JEM) founder Masood Azhar. It seeks to legitimise Pakistan’s illegal occupation of parts of Jammu and Kashmir. China is, therefore, not only complicit in Pakistan’s State sponsorship of terrorism against India, but also an accomplice.For decades, Indian leaders have been delusional about China’s real intent: stalling India’s inevitable rise as a rival global power. Beijing has used deceit, threats, inducements and flattery since the 1950s to pursue its long-term goal of emerging as the sole Asian hegemon, which can then challenge the US-led Western alliance for global supremacy.It bided its time till its GDP rose to within sight of US GDP. As recently as 2007, Chinese GDP was only $3.55 trillion — just above India’s current level. In 2019, Chinese GDP quadrupled to over $14 trillion, within range of the US’ $21 trillion.India’s battle against China must, therefore, be fought not only by the military but also by sound geo-economic strategy. Much is made of how little India’s ban on Chinese companies will impact Beijing and end up hurting India more. This is a shortsighted argument. Chinese policymakers think decades ahead. They know that India’s disruptive democracy and slow economic decision-making has caused the Indian economy to underperform for years, while its bureaucratic red tape has frightened off global investors.Yet, Chinese leaders are far-sighted enough to know that over the next decade, India will emerge, one way or the other, as the world’s third-largest economy and second-largest market.Its minuscule share of global trade will inevitably rise. If Chinese companies are gradually shut out of India, China will take a hit. Its economy is slowing following the steady shift of global supply chains out of China.Chinese society is now ageing fast as a result of Mao Zedong’s one-child policy during the 1960s Cultural Revolution. This will affect China’s productivity and its fiscal position as pensions for the growing numbers of the elderly rise.For India, a smart geo-economic policy must focus on reducing dependence on Chinese imports and investment. Vulnerable sectors like pharma, electronics and telecom must replace Chinese vendors just as the government has begun doing with MSMEs and for contracts with power, highways and other infrastructure projects. India’s consumer market is large enough to compel companies like Amazon to jettison Chinese products from their ecommerce platform and replace them with goods from local stores as the leading US firm has already done.The road ahead is long and hard. India must verify over the next few days whether China is keeping its word on disengagement along key points at the LoAC.