[Riordan Roett, Guadalupe Paz (Eds.). Latin America and the Asian Giants: Evolving Ties with China and India. Brookings Institution Press, 2016, 336 pages]

review / Ignacio Urbasos Arbeloa

Trade between Latin America and the Asia-Pacific region has grown during the last decade at a dizzying rate of 21% per year[1]. However, China's prominence has overshadowed and concentrated the vast majority of academic analysis, leaving other relevant actors such as India in the background. This book by Riordan Roett, Guadalupe Paz and other contributors from different parts of the world offers an interesting comparison between the two "Asian giants" in their relations with Latin American countries in a new global context. This review, will focus on the rise of India in the region, although references to China are unavoidable.

Historical ties between Latin America and India, though weak, have existed since the colonial period. Today one million people[2] descendants of Indian migrants live in the Caribbean, a fact that can be considered an opportunity to generate channels of dialogue, however the magnitude of the Indian diaspora eliminates any trait of exceptionality. Another interesting element directly relates India and Brazil, two countries that share to some extent the Portuguese bequest and have been standard bearers of South-South cooperation to this day, an approach shared by Lula and Dilma as well as Modi. In the historical section , India's relevance is much greater than that of China, which lacks relevant references partner-cultural in the region.

The growing economic presence of the two Asian giants in Latin America has not gone unnoticed in the political discussion . Historically, leftist sectors have been more supportive of increased trade relations with China, seeing it as a way to achieve the emancipation and independence of the continent from the United States. The right, on the contrary, has been reluctant to a greater presence of China, aligning itself in the case of the countries of the Pacific Alliance with the TPP, which until the arrival of Trump was intended to be a free trade agreement aimed at increasing the presence of the American continent in Asia-Pacific apart from China[3]. In the authors' opinion, Latin America lacks a cohesive narrative and strategy on China, thus drastically reducing its negotiating capacity and influence on the Asian country. The case of India is different, as its trade volume is still one tenth of China's, it is a democratic country, a US ally and has a better image in the continent.

Despite the fact that the vast majority of Latin American exports to Asia are made up of commodities and imports of manufactured products, there are subtle differences that explain India's better image in the region. First, Chinese imports are much more diversified than Indian imports, generating a general perception of destruction of the industrial fabric and local jobs due to greater competitiveness due to economies of scale and the distortion of the yuan. Likewise, what India exports to Latin America are socially valued products (as in the case of generic drugs, which have reduced the price of medicines) and cheap vehicles, while Indian entrepreneurs set up information companies, which have generated 20,000 jobs in the region.

In terms of imports, both India and China concentrate their purchases in natural products, with India's profile being more energetic and China's more mining. Both countries have a huge demand for soybeans, a product that agreement with Riordan Roett will gradually become increasingly important due to its versatility as food, feed and source of biofuels. It is important to note that Latin America is one of the keys to the energy and food security of these countries, which face this enormous challenge derived from the size of their population in different ways: India is betting on private investment and China on long-term purchase agreements with its public companies. A possible collision between the two Asian giants for access to these markets cannot be ruled out, with the geopolitical implications that this entails.

As for India's financial positioning in Latin America, the reality sample is that its presence in Latin America is almost testimonial compared to that of China. However, it is worth noting that Indian investment and loans are seen in a much better light than Chinese ones. In general, India acts as a transparent partner and is accustomed to Latin American practices, something that does not happen with China, whose actors are more accustomed to dealing with a complex bureaucracy rather than a democratic system. Likewise, Chinese loans, increasingly present in certain economies such as the Venezuelan or Ecuadorian, have proven to be less advantageous than those of international organizations such as the IMF or IDB, as they have higher interest rates and are tied to strict conditions for the purchase of goods. All this makes India a friendlier partner for public opinion: a challenge that it will have to face as it increases its presence in the region and thus its true way of acting abroad, still an unknown quantity, can be appreciated.

At final, India's role in the region is promising although still limited in scope. The annual growth of trade between that country and Latin America was 140% between 2009-2014[4] and in addition India has already signed the first free trade agreements (with MERCOSUR and Chile), although of small magnitude. It should be noted that this trade is mainly of an inter-industrial nature, in which Latin American countries export primary products and natural resource-based manufactures and import manufactures of different technological intensities, which limits the potential for establishing deeper economic relations between the two regions[5] and condemns them to commodity price fluctuations. The fact that it takes 45 to 60 days for a cargo ship to reach Indian ports from the Chilean coast is a real barrier to trade, but there are many reasons to expect a greater regional presence from India, such as its excellent relations with Brazil, expectations of annual growth of over 7% of its GDP and the inescapable importance of Latin America in guaranteeing energy and food security for the growing population of the Asian country.