Tag Archives | East Asia

The Asian Balance: Recognising good neighbours

By on 20th September 2010 in Foreign Affairs

My new monthly column in Business Standard is called The Asian Balance. It “will devote itself to chronicling and interpreting the unfolding geopolitics of East Asia. It will be a unabashed advocate of Looking East far beyond the Straits of Malacca. Rebuilding the economic, cultural and political relationships that India historically shared with the countries and the peoples to its East has never been more important to our future than it is today.”

The first piece is up. Here’s an excerpt:

Three factors will shape the Asian balance: first, nuclear weapons—what I call the New Himalayas—will shift the India-China contest away from a direct military conflict along the land border. It will take place, among others, in and around the Indian Ocean. It will play out in the form of increased Chinese presence in the waters off India’s coast and renewed US engagement of Asean countries. The big question is to what extent will India be a player in areas that China considers its backyard.

Second, the small- and medium-sized countries of the region will prefer a balance where no single power dominates over them. If they do not see this forthcoming, they are likely to join the stronger side. What this implies is that the importance they give to their relationship with India will depend on their assessment of whether New Delhi has the capability, and the will, to contribute to the balance.

Third, unless there is an addition to the number of nuclear powers in East Asia, there will be a preference to create and work through regional multilateral institutions like the Asean Regional Forum (ARF) and the East Asia Summit (EAS). The absence of direct nuclear deterrence in the Western Pacific has emboldened China to claim almost the entire South China Sea as its own. All the activity in East Asia trying to form one big workable grouping is premised on the unfounded hope that a powerful China will play by the rules it promises to. [Business Standard]

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The wolf in the cabbage patch

By on 16th September 2010 in Foreign Affairs

…is unlikely to be vegetarian

The tragedy of M K Bhadrakumar’s article in today’s Hindu is that one half of it is eminently sensible and the other, unsubstantiated wishfulness. Yes, it is important not to allow paranoia to determine policy towards China, but unless Mr Bhadrakumar is wired into the minds of the Chinese leadership, it is illogical and dangerous to assume that the wolf in the cabbage patch is vegetarian. And will remain vegetarian.

As I had tweeted earlier, reports of Pakistan handing Gilgit-Baltistan over to China are almost certainly exaggerated. This does not mean, however, that the scenario is implausible. To the extent that Selig Harrison’s article caused the public and politicians to consider the implications of such a scenario—and hopefully, prepare for it—it served a purpose. It is quite possible that Mr Harrison was an unwitting part of a disinformation operation, perhaps by the United States, to ensure that public opinion in India remains wary of China. If this were so, shouldn’t China be extra careful to ensure that it doesn’t deliberately carry out unfriendly acts like the visa denial to a senior military officer? Mr Bhadrakumar would have been on a firmer footing had he listed some measures China took to prove its bona fides vis-a-vis India. I myself can count none.

Mr Bhadrakumar goes on to make two key assertions. First, that stability in India’s immediate neighbourhood needs India and China to co-operate, and that China sees a stable subcontinent as in its interests. Second, that growing Chinese influence in the neighbourhood will not damage India’s interests. There is no basis for such beliefs, and surely enough, he does not offer any.

On the first point, there is direct evidence that China uses unstable states to indirectly keep its adversaries engaged. China deliberately transferred nuclear weapons technologies to Pakistan, Iran and North Korea so that India and the United States could expend their resources tackling the paw, not the cat. It is hard to adduce evidence to prove conclusively that China is deliberately destabilising the subcontinent in order to contain India, but no sensible person can dismiss the possibility. The onus is on Mr Bhadrakumar to produce evidence of Chinese moves to stabilise the neighbourhood in co-operation with India. Does selling nuclear reactors to a highly unstable Pakistan, in violation of its international commitments, count?

On the second point, realists will accept that China’s influence in the subcontinent will grow, whether or not India likes it. But that’s not the issue. The issue is, even in the unlikely event that China itself does not use its influence against India’s interests, the countries of the subcontinent almost certainly will. Bilateral relations with Nepal, Bangladesh, Pakistan, Sri Lanka, Maldives, Myanmar and countries of ASEAN will get even more difficult to resolve, because their leaders will play New Delhi against Beijing. There’s evidence for this: King Gyanendra, Khaleda Zia and Mahinda Rajapaksa all pursued policies contrary to New Delhi’s recommendations. Two of them lost power, but not before plunging their countries into instability and crises. Mr Rajapaksa didn’t lose power, but thanks to Chinese influence, tragically believes he can avoid genuine reconciliation after the civil war.

While India cannot prevent China from increasing its influence in the subcontinent, there is no reason to welcome it. New Delhi must act to increase its own influence and counter China’s. That’s not all. The game is not restricted to the neighbourhood—it is global. Ergo, India must extend its influence in and around China’s immediate neighbourhood. As I wrote in my Pax Indica column recently, New Delhi needs a Look East Beyond Singapore strategy. Achieving balance within regions and balance between regions is the surest way to have a stable relationship with China.

Related Posts: M K Bhadrakumar routinely imputes benevolent motives to Beijing. Couple of instances: Worshipping false gods; John 8:7 doesn’t apply to international relations

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Newspapering over nuclear weapons

By on 22nd August 2010 in Foreign Affairs, Security

Rules won’t make China obey them. Nukes just might.

The Economist declares China v India as the contest of the century. Good. It should help focus minds of international readers on an important issue, because in the coming years they are likely to have to choose sides.

But the 20th century taught the world that blatantly foreseeable conflicts of interest can become increasingly foreseeable wars with unforeseeably dreadful consequences. Relying on prosperity and more democracy in China to sort things out thus seems unwise. Two things need to be done.

First, the slow progress towards a border settlement needs to resume. The main onus here is on China. It has the territory it really wants and has maintained its claim to Arunachal Pradesh only as a bargaining chip. It has, after all, solved intractable boundary quarrels with Russia, Mongolia, Myanmar and Vietnam. Surely it cannot be so difficult to treat with India?

That points to a second, deeper need, one that it took Europe two world wars to come close to solving: emerging Asia’s lack of serious institutions to bolster such deals. [The Economist]

While framing the challenge fairly well, that famously opinionated newspaper ignores the beasts in the basements that are the ones most likely to prevent their masters from coming to blows. We are, of course, referring to nuclear weapons, which I have argued, are the New Himalayas that make direct military conflict between the two giants unlikely. Indeed, it is the shadow of the New Himalayas that contrains China from expanding its extravagant claims to the old Himalayas.

You can see how the absence of direct nuclear deterrence in the Western Pacific has emboldened China to claim almost the entire South China Sea as its own (see the myths that Yang shattered). All the activity in East Asia trying to work out a regional security architecture is premised on the unfounded hope that a powerful China will play by the rules it promises to. Liberal internationalists, of course, will prescribe such hope-based policies. It is unfortunate that a newspaper as bold as the Economist should accept this wishfulness to such an extreme that it entirely ignores nuclear deterrence. It might be that it has to do this, because evoking nuclear weapons would damage its dogmatic and silly insistence that India should give up its arsenal because it is ‘illegitimate’.

From the archive: He saw the light after leaving the Economist; a review of Bill Emmotts’ book.

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Pax Indica: East of Singapore

By on 3rd August 2010 in Foreign Affairs, Security

The waters east of Singapore hold the key to the lands west of the Indus

Yesterday’s post was about the developments in East Asia. In today’s Pax Indica column, I argue that India must be part of the security equilibrium in that region. Excerpts:

India’s strategic power projection will not be unwelcome in South East Asia. It will also enable the United States to remain engaged in Afghanistan-Pakistan by freeing up resources that might otherwise be employed in the western Pacific. Also, regardless of what the United States does, an Indian strategic commitment in East Asia will strengthen its overall negotiation position with China.

Whatever might have caused China to bully its neighbours this year, it has opened another window of opportunity for India to engage with the region. Pre-occupied as it is with the game in the north-western part of the subcontinent, it is unclear if New Delhi sufficiently realises that the seas east of Singapore hold the key to the lands west of the Indus.

India must vastly increase its economic, diplomatic and military presence in and beyond South East Asia. [Yahoo! India]

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Kim crosses China’s line

By on 29th June 2009 in Foreign Affairs

Brinkmanship does not work beyond the brink.

“Either a nuclear-equipped DPRK or a collapsed DPRK,” Wu Chaofan concludes, “would cause disastrous interruption of the process of China’s peaceful development.” As long as the North Korean regime was playing inside these boundaries it was possible for China to use the situation to apply strategic pressure on the United States, Japan and South Korea. The threat from North Korea prevents the United States from concentrating its resources on Taiwan, and to that extent, reduces China’s cost of maintaining a balance of power across the Taiwan straits.

So it would be terrible for China if North Korea crossed those boundaries.

…many Chinese experts and advisors are more concerned with the threat Pyongyang’s nuclear weapons poses to China’s security. After adoption of Resolution 1874, the DPRK responded with a big rally in its capital. Its leaders announced that the country would stick to its own path, regardless of whether friendly countries sided with it and the effect on international aid. Such an attitude on the part of Pyongyang is a warning that China should reconsider its national interests.

Pyongyang’s nuclear tests, which took place only tens of kilometers from the Chinese border, might cause an environmental catastrophe in a densely populated area, not to speak of the threat it is to peace and stability in East Asia and the world as a whole. Any deadly accident following Pyongyang’s nuclear tests would not only inflict enormous losses on the Korean people but also seriously damage the environment in Northeast China and the surrounding region. [China Daily]

Mr Wu quotes two Chinese scholars who essentially warn North Korea’s neighbours to be prepared for the worst. China has been unable to persuade North Korea to stand down. Meanwhile Japan and South Korea have not only taken a hard line against Pyongyang, but have—in the delicate style of East Asian diplomacy—asked China to deliver. More than the US airstrikes that the Chinese scholars warn about, the real threat to China comes from the prospect of both Japan and South Korea developing their own nuclear deterrents.

If the North Koreans don’t oblige, then China will be, well, in a soup.

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When in a corner, show teeth

By on 19th June 2009 in Economy, Foreign Affairs

A chastened but sanctimoniously aggressive dragon

Qin Gang, China’s foreign ministry spokesman, made some eminently reasonable and sensible points yesterday. The Asian Development Bank’s approval of a loan package to India—which includes financing of a project in India’s Arunachal Pradesh state (which China calls ‘Southern Tibet’ and claims as its own)—he said, “can neither change the existence of immense territorial disputes between China and India, nor China’s fundamental position on its border issues with India…On China-India border issues, China always believes that the two sides should seek for a fair and equitable solution acceptable to both through bilateral negotiation.” (via Indrani Bagchi’s Globespotting blog)

In other words, ADB’s approval of a loan doesn’t change the positions of India and China with respect to the territorial dispute, and that bilateral negotiations (not multilateral economic fora like the ADB) are the place to sort the issue out.

So who were those unreasonable and insensible people who thought otherwise? None other than the representatives of the People’s Republic of China. None of their counterparts on ADB’s governing board agreed. Diplomacy being the art it is, it was left to Mr Qin to sound as if it was someone else who was flagrantly violating the norms of conduct at multilateral economic institutions.

The Chinese foreign ministry, however, does not stop at that. Mr Qin goes on the offensive. The ADB, he warns, “should not intervene in the political affairs of its members. The adoption of the document has not only dealt a severe blow to its own reputation but also undermines the interests of its members. The Chinese Government strongly urges the ADB to take effective measures to eliminate the terrible impact thereof.”

China’s entire approach to the ADB loan issue signals a dangerous portent for Asia. It would perhaps have been understandable if China had limited its protest to a symbolic pro forma objection. To transform the ADB as a forum to push its position in a bilateral dispute is an entirely different matter—and one that has serious implications for its relations with its East Asian neighbours, with whom it has unsettled disputes too. A charitable explanation is that it couldn’t back down without losing face once it had fired the first salvo. If you feel less charitable, you will see fresh signs of a deliberate strategy to flex its economic muscles for purely political ends. When zero-sum games are pursued at positive-sum arenas, the latter quickly become the former.

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Nuclear umbrellas in East Asia and the Middle East

By on 18th June 2009 in Foreign Affairs, Security

China must act forcefully to stop North Korea and Pakistan from expanding their nuclear arsenals

The Obama administration tasted its first—and crunching—diplomatic defeat at the hands of the North Korean regime last week. After threatening to interdict North Korean ships, just about the only action the US government will take in response to North Korea’s nuclear and missile tests is that the US navy will effectively merely tail those ships around, not stop, board or seize them.

Washington might be helpless in stopping North Korea from expanding its nuclear arsenal or periodically threaten its neighbours, but it can protect South Korea (and quite likely Japan) under the US nuclear umbrella. Yesterday, Mr Obama signaled just that. According to Yonsei University’s Chung Min Lee “This sent a strong signal to North Korea. The move should also allay concerns in some quarters that South Korea and Japan may need to pursue their own nuclear options.” Unfortunately, even this is insufficient to create a stable nuclear balance based on mutual deterrence.

The missing factor is China. Continue Reading →

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No room in Chiang Mai

By on 14th May 2009 in Economy, Foreign Affairs

China’s geoeconomic move to strengthen its geopolitical power in Asia

A few days ago, China, Japan, South Korean and the ASEAN states agreed to set up a US$120 billion to manage currency volatility. The Chiang Mai Initiative (CMI) primarily reduces the member countries’ dependency on the International Monetary Fund. It deliberately excludes India.

Here’s an excerpt from an EIU report on the development:

But does it make sense to compare the CMI to the IMF? Given that the meeting of G20 countries in London in early April resulted in pledges to triple the IMF’s reserves, from US$250bn to US$750bn, the expansion in the CMI does not initially look too impressive. Moreover, the severity and synchronisation of the global crisis imply a need for a much larger pool of emergency funding. But US$120bn is still a sizeable amount, arguably enough to allow the CMI to deal with crises in several countries (the IMF bail-out of South Korea in 1997-98 cost US$57bn). A lack of IMF conditionality might also encourage countries to make preventative use of the CMI, and thus to act to before external imbalances became unmanageable.

At the same time, however, the global crisis has changed views of the IMF’s correct role, and of the effectiveness of free-market policies. The IMF has now conceded that its loans need not always have stringent policy conditions. Its new Flexible Credit Line (FCL) embodies this view, as the FCL is designed to be used as a contingency by countries with sound economic fundamentals. To some eyes, the creation of the FCL obviates the need for a special Asian fund. Why bother setting up an Asian facility when the IMF already has a similar programme, and one that no longer carries the stigma that it used to? But although recent moves by Mexico, Poland and Colombia to tap the FCL should encourage others to do the same, Asian suspicion of IMF lending will persist. In any event, an increase in the absolute pool of funds potentially available to ASEAN + 3 countries is welcome, given the severity of the global crisis and the possibility that crises in other regions will create heavy demand for IMF funds.

At the same time, the CMI may not prove to be quite as hassle-free as potential users may imagine. In part for political reasons, countries that act as “suppliers” of foreign exchange—mainly China and Japan—are highly unlikely to impose the sort of formal austerity conditions associated with IMF lending. But they will still expect to see measures taken to ensure that they get their money back when the currency swaps expire. If a “recipient” country is in such straits that this looks unlikely, the donor may be reluctant to conduct the swap. Alternatively, reserve-rich countries like China may be tempted tacitly to extract political concessions from recipients in return for access to swaps, complicating the entire process and increasing the potential for diplomatic friction. At first glance, the CMI may help the likes of China and Japan to be seen as coming to the rescue of their neighbours. But if wrongly handled, the scheme could backfire and cause them to be perceived as seeking to exploit the crisis for strategic gain. [EIU, emphasis added]

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Among white swans

By on 29th October 2008 in Economy, Security

On estimating political risk in India

India is the only Asian country outside the East Asian region to be included in the Political & Economic Risk Consultancy’s (PERC) Asian Risk Prospects for 2009 report. According to PERC, India is the riskiest country among those analysed, and it’s risk rating is to increase for the coming financial year. The executive summary says:

India faces some of the biggest risks in 2009 because of uncertainties surrounding the coming general election, rising communal violence and terrorism incidents. The global financial crisis is not an entirely bad thing. The economy needs to take a breather and certain sectors like real estate need to experience sharp price corrections in order to restore India’s competitiveness. India’s underlying attractions to foreign investors should remain no matter who wins the next election. The biggest risk is that a deterioration in political and economic conditions in neighboring Pakistan could aggravate social unrest in India further and hurt national security.[PERC]

General elections, communal violence, terrorism—these are neither new nor too much of a bother for foreign investors. It is perhaps the possibility of the Singur type of public agitations that should be more of a concern. Even so, the geographical variation of political risk among Indian states makes a national level risk assessment neither too accurate nor too meaningful. The analytic framework must focus on estimating political risk in India, than that of India.

So is the case with the Pakistan factor: in addition to the geographic factor, unless the channels by which the turmoil in Pakistan is transferred to India are understood and analysed, the conclusion that it will aggravate social unrest in India is too general to be of much use.

Moreover, the risk factors PERC cites in India’s case are well-known and well-understood. The real issues are of the Black Swans that might turn up among the ostensibly less risky, but considerably more opaque East Asian economies.

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Concerning Australia’s uranium sales

By on 28th July 2008 in Foreign Affairs

The Rudd government would do well to climb out of an unnecessary hole it has dug for Australia

Greg Sheridan has a very insightful piece on the India-US nuclear deal and the stakes for Australia (linkthanks V Anantha Nageswaran). He gets it right when he argues that Australia can’t hope to enjoy a close relationship with India if it maintains a discriminatory policy on uranium sales.

Then the deal must be approved by the Nuclear Suppliers Group. Here’s where Australia comes in. With something like 40 per cent of the world’s known uranium reserves, Australia is a key member of the NSG. So far, the Rudd Government has not said whether it will support the US-India deal at the NSG or oppose it.

It has however hinted that it would support the deal at the NSG, a hint Foreign Minister Stephen Smith repeated yesterday. Certainly Australia could kiss goodbye forever the idea of any decent relationship with India if it opposes the deal at the NSG.

Accepting the deal at the NSG would not commit Australia to supplying uranium to India. However, that will be the next big question…

Opposition foreign affairs spokesman Andrew Robb has effectively homed in on the contradiction between the Rudd Government selling uranium to China – which has a terrible, though not recent, record of nuclear proliferation – while refusing to sell uranium to India, which has never passed on nuclear technology to anyone.

..the Rudd Government will face a deep contradiction between supporting the US-India deal in the NSG, then saying it will not sell uranium to India. It will face an even bigger contradiction between its concern with greenhouse gas emissions and taking action, by refusing uranium to India, that impedes the development of clean energy. [The Australian]

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