China-India Brief #221
March 03, 2023 - March 16, 2023
Centre on Asia and Globalisation
Lee Kuan Yew School of Public Policy
Published Twice a Month
Guest Column
The COVID-19 pandemic led to a surge in vaccine diplomacy—the practice of distributing vaccines abroad for diplomatic purposes. Countries that had the capacity to develop and distribute COVID-19 vaccines did so to reward allies, to maintain or expand spheres of influence, or simply to make financial profit. Western industrialised countries, particularly the key players in global health governance, such as the United States (US) and United Kingdom (UK), have developed some of the most effective vaccines for COVID-19 and have distributed them in vast amounts. Different from previous public health emergencies of international concern (PHEIC), the COVID-19 pandemic witnessed rising powers as major states conducting vaccine diplomacy. Indeed, China and India started distributing COVID-19 vaccines abroad well before Western countries, which made them the only vaccine suppliers for the developing world at the height of the pandemic.
Indigenous versus foreign vaccines
The soft power in a country’s vaccine diplomacy comes from its capacity to produce and export its ‘own’ vaccines. This could occur one of two ways. The preferred method would be to develop indigenous, home-grown vaccines, which would allow states to enhance their own image and international influence. Alternatively, states could produce vaccines of other, more reputable or recognised brands under license. Unsurprisingly, for any developing country without a track record of pharmaceutical R&D, the first path will be more challenging. China chose to embark on the first path. India aspired to achieve both, but only succeeded in the latter.
Currently, the most widely used COVID-19 vaccines in China are those developed by Chinese companies: Sinopharm (BBIBP-CorV), Sinovac (CoronaVac), and to a lesser extent, CanSino (Convidecia). The Chinese government provided much-needed financial, institutional, and infrastructural assistance to accelerate vaccine development and approval. Vaccine development began in China in January 2020, and by April 2020, all three vaccines (which would later be used extensively in China’s overseas vaccine diplomacy) had already begun domestic clinical trials. Sinopharm and Sinovac vaccines both used the inactivated virus platform, which is a traditional technique to design vaccines, albeit less effective than the new-generation DNA/RNA platform. The vaccines were developed through partnerships between public research institutions and pharmaceutical companies, in which public institutions provided the high-containment biological laboratories and the private companies were responsible for arranging the clinical trials.
Similarly, India also developed its own indigenous vaccine, Covaxin. Like Chinese vaccines, Covaxin was an inactivated virus-based vaccine developed through public-private collaboration, in this case, between the National Institute of Virology, the Indian Council of Medical Research, and the privatively owned Bharat Biotech. For Covaxin however, public institutions were only responsible for isolating the virus strain and identifying sites for clinical trials, while vaccine development was conducted solely by Bharat Biotech. Without clinical trials abroad and state-sponsored marketing, Covaxin failed to enter major emerging markets and did not receive the World Health Organisation’s Emergency Use Authorisation (EUA) until November 2021, half a year after Sinopharm and Sinovac.
Thus, India instead relied on Covishield, the AstraZeneca-Oxford vaccine manufactured by Serum Institute of India (SII), as its main currency in vaccine diplomacy. Following an agreement to manufacture the (original) AstraZeneca-Oxford vaccine, the SII was given authorisation to produce Covishield and distribute them at production costs to developing countries. SII would go on to secure deals to supply vaccines to COVAX—a worldwide vaccine sharing initiative—eventually becoming its single largest contributor.
Production and distribution
To enable vaccine diplomacy, a country needs significant production and distribution capabilities. China and India differed in their endowment and resources in the vaccine supply chain. China could leverage its flexible and reliable vaccine production and distribution networks to address quality concerns and meet the preferences of individual buyers. In India’s case, it took advantage of its production capability to become the main supplier for COVAX and AstraZeneca orders worldwide, which unburdened it from having to itself market the vaccine.
During the initial phase of the pandemic, a major challenge that faced Chinese vaccine producers was the credibility of their vaccines. China was a newcomer in the global vaccine industry, and without WHO EUA, many countries were hesitant to buy Chinese vaccines without knowing its efficacy. The solution that China found was to focus its efforts on reaching out to developing countries where the pandemic was yet to be contained, as they tended to be more willing to cooperate and were also potential markets. Chinese vaccine developers worked to ensure they conformed to each partner country’s strict regulations, carrying out localised phase-3 clinical trials (for efficacy) which were crucial for regulatory approval.
Phase-3 clinical trials would go on to be carried out in developing countries across the world: Sinopharm in Peru, Argentina, Morocco, Egypt, Bahrain, UAE, Jordan, and Malaysia; Sinovac in Brazil, Turkey, Indonesia, and Philippines; and CanSino in Mexico, Chile, Saudi Arabia, Pakistan, and Russia. China’s clinical trial agreements likely included clauses for post-trial purchases, which would be attractive to developing countries that struggled to secure sufficient doses for their populations. By August 2021, China had secured orders from every country that had hosted phase-3 clinical trials.
Chinese vaccine companies also gained a reputation for their flexibility and reliability. They were usually able to deliver their products faster and with fewer shipping delays compared to other vaccines. This was why some countries ordered Chinese vaccines to hedge risks and ensure they had sufficient stocks for their scheduled vaccination drives. Moreover, Chinese vaccine makers were willing to accommodate their customers’ preferences in the deliveries. They could deliver finished vaccines, ready-to-fill ingredients, or raw materials with technology transfer. If joint ventures for vaccine production were established, such as the one between Sinopharm and the Abu Dhabi-based G42, personnel training and machinery would be provided for local partners to begin production. This attracted states that sought to integrate themselves into the global pharmaceutical supply chain.
For India, it already had a stellar track record as a global supplier of generic drugs and was the home of SII—the world’s largest vaccine maker. This already put India in a highly advantageous position to engage in vaccine diplomacy during the pandemic. But India was given another edge when SII was awarded the exclusive right to produce the WHO-approved AstraZeneca COVID-19 vaccine for COVAX. This removed any need for marketing, since SII was already earmarked to fulfil COVAX’s big orders, and the deal generated interest from other international buyers. Moreover, given that India was both a supplier and recipient of vaccines under COVAX, and since the orders were paid for by the initiative, it meant that India received a large portion of the vaccines it produced for free.
However, SII faced major financial challenges. The Indian government was initially unwilling to assist with the company’s manufacturing costs. While the Gates Foundation would step in in August 2020 to finance the production of vaccines designated for COVAX, for domestic orders, both SII and Baharat Biotech had to find ways to fund their own manufacturing costs. It was not until April 2021, amid India’s ‘Delta wave,’ that the Indian government finally agreed to provide $600 million for these two companies to expand production. However, the slow and limited governmental support caused SII to delay its promised vaccine deliveries to COVAX and bilateral buyers by half a year. This affected India’s reputation as a reliable vaccine supplier.
Geopolitics and vaccine donation
Although the majority of vaccines that China and India have distributed has been through commercial sales (bilaterally or through COVAX), their vaccine donations have also received international attention for their geopolitical impact. In the case of China’s early vaccine donations, it is likely that geopolitics played a factor in its decision-making, given how Southeast Asian countries and Pakistan were prioritised. Of the thirteen countries that received China’s first batch of vaccines, five were ASEAN members and four shared borders with China.
As Chinese vaccine donations arrived in Southeast Asia and Africa as early as February and March 2021, many of these countries kicked off domestic vaccination programmes using Chinese vaccines, sometimes with their national leaders taking the first shot on national television. In addition to bilateral and regional donations, China also launched the ‘Spring Vaccination Plan’ (春苗行动) in March 2021 to vaccinate Chinese citizens abroad, particularly those in developing countries with limited access to COVID-19 vaccines.
India’s ‘Vaccine Maitri’ (Vaccine Friendship) initiative took place around the same time but unfolded on a smaller scale in South Asian countries and Caribbean states with large Indian diasporas. India was approached by over ninety countries for vaccines, but it prioritised its neighbours, in accordance with its ‘neighbourhood first’ policy. Bhutan and the Maldives were the first countries to receive India’s vaccine aid on January 20, 2021, followed by Nepal, Bangladesh, and Myanmar. One of India’s largest donations was to Nepal (1.1 million doses), where India and China have been competing for influence. Myanmar also shares borders with both China and India. China initially promised to send 300,000 doses, but India quickly delivered 1.7 million doses before Myanmar received the shipments from China.
Conclusion
To summarise, China and India pursued vaccine diplomacy for very similar geopolitical and economic goals. However, they adopted different tactics in pursuing these goals, and the impacts of their vaccine diplomacy also varied. This article highlighted two factors that shaped each country’s COVID-19 vaccine diplomacy. First, it showed that a country’s place in the vaccine/pharmaceutical value chain can influence its tactics in vaccine choice, production, and marketing. Countries vary in their comparative advantages in R&D, production, and distribution, so they strategise to improve the efficiency of the supply chain to deliver more vaccines in a timely manner. Second, it showed that the geopolitical and global ambition of a rising power affects how much it is willing to invest in costly vaccine diplomacy. Not only is governmental support crucial in vaccine development and production, the government’s geopolitical ambition also determines how far it is committed towards projecting soft power with vaccines.
So which country’s vaccine diplomacy has been more successful? During the early stages of the pandemic (between early 2020 and mid-2021), China distributed far more vaccine doses through sales and donations than India. For many hard-hit countries, the arrival of Chinese vaccines was a beacon of hope, crucial for protecting their frontline workers and allowing governments to begin vaccinating their citizens. Thus, for a time at least, China’s international image was greatly enhanced, and it was seen as the more reliable first-responder/partner compared to India.
Since then, however, much of the international goodwill towards China has dampened. Chinese vaccines were found to have lower efficacy against newer COVID-19 variants, and many countries, including Indonesia, Thailand, and the Philippines, subsequently shifted away from Chinese vaccines once alternatives became more widely available. A resurgence of COVID-19 cases in China, and Beijing’s insistence on keeping strict ‘zero-COVID’ measures in place, even as much of the world was opening up, further eroded its image and undercut the early success of its vaccine diplomacy.
On the other hand, India’s vaccine diplomacy has reaffirmed its role as the largest pharmaceutical manufacturer in the world, and it has taken advantage of the pandemic to attract orders for other Western COVID-19 vaccines, such as Novavax and Janssen vaccines, as well as Western pharmaceutical investments to India. Amidst the growing US-China rivalry, the US and many other industrialised countries are increasingly supporting India through the QUAD, Indo-Pacific Economic Framework, and bilateral initiatives to counter-balance Chinese influence, and vaccine cooperation features strongly in these collaborations.
Shiming Yang, PhD., is an Assistant Professor in Global Political Economy of China at the Institute for Area Studies, in Leiden University. Her research focuses on environmental politics and political economy, with a focus on rising powers and changing global orders amidst emerging challenges.
Image Credit: iStock/volodyar