COMMENT: CHINA THROWS ITS WEIGHT

Who thought that China and Australia would get involved in a diplomatic spat under Australia’s Mandarin-speaking Prime Minister, Kevin Rudd? He was supposed to be the good guy to put relationship between China and Australia on a special footing. What went wrong, then?

The immediate context is the arrest in Shanghai of four Rio Tinto employees, one of them an Australian passport holder. China has accused them of stealing state secrets to damage Chinese interests.

For China, Rio Tinto is becoming the symbol of Australia’s ugly side by not letting Beijing play a determining role in the pricing and supply of its much-needed (by China) raw materials, like iron ore.

China felt spurned when its bid to increase its stake in Rio Tinto was thwarted. It is chagrined further that Australia is not agreeable to about 40 per cent reduction in the price of iron ore as demanded by China.

China expected a lot from Kevin Rudd. But, instead, after coming to power, he politely told China during his Beijing visit to explore a dialogue with the Dalai Lama, compounding China’s fury in the wake of Tibetan unrest last year during 50^th anniversary of its occupation by China.

And China is not amused that Australia’s defense white paper seems to suggest that China’s rise and the consequent US decline could become unsettling for the region, particularly necessitating “fundamental reassessment” Australia’s strategic assumptions.