By: Kirti Sharma, Research Analyst, GSDN

The unfolding geo-economic and geo-political “complex interdependence” as asserted by Robert Keohane and Joseph Nye in the 1970s is the realpolitik while envisaging the future of two states which are hailed for their democratic values. However, growing apprehensions in both India and USA about Chinese aggression has created the strategic convergence long sought by the US defence establishment eager to enlist India to balance China. While tracing back the long history of these two states holding genuine relations since 1998 when the USA put sanctions on India after the nuclear test. The circular gambit of diplomacy has altered to the strategic level from America’s “strategic Altruism” to “America First” in the wake of Indo-Pacific region supremacy which renders India the pseudo-hope to consolidate its economic, military, and trade prospects in the future. The successive Indo-US ties have been captured in the wake of the leadership of respective states from the Bush-Vajpayee era to Bush-Singh era to Obama-Singh era to Obama-Modi era to Trump-Modi era and notably, to the present Biden-Modi era which seeks to embrace the idea of “multi-polar Asia.”

Furthermore, the dynamicity of bilateral cooperation also gets reflected in their Indo-Pacific partnership. The Indo-Pacific represents both convergences and divergences between India and the US. As such, both will have to approach their differences carefully, specifically on the definition of the exact geographic limits and definitive strategic intentions of their respective Indo-Pacific strategy. Biden Administration has the privilege to work on an already nurtured relationship between the US and India in the Indo-Pacific. The two countries have moved towards issue-based partnerships, while still maintaining differences and their core interests intact. Given the dire circumstances, India’s stimulus efforts have been unimpressive.  China’s aggressiveness has manifested itself across the Asia-Pacific in Beijing’s military buildup in the disputed South China Sea, its muzzling of Hong Kong’s autonomy, and its building of numerous ports and infrastructure projects around the world as part of the ambitious Belt and Road Initiative (BRI). India has witnessed China’s coercive behaviour on its border since the first Indo-Sino war of 1962 which further proliferates across its backyard in South Asia and the Indian Ocean region.

Nonetheless, India will continue to hold on to its strategic autonomy as it navigates an uncertain geopolitical landscape. One of the Biden administration’s most critical tasks will be to ensure that the current convergence with India on the China threat endures. As they mull whether to partner with the United States in standing up to Beijing, policymakers in New Delhi will be carefully watching to determine whether they can rely on Washington to do the same. If they sense Washington adopting a more conciliatory approach toward Beijing, they may revert to a hedging approach once again.

Covid-19 has knocked an economy that was starting to stall on the side of the highway right into the ditch. The road to recovery will be long and tortuous. The established structural framework between the two countries, such as the Indo-US Comprehensive Global Strategic Partnership; the 2+2 Ministerial Dialogue; India’s designated status as a Major Defence Partner of the US; strong bilateral trade in the defence sector undergirded by a mutual democratic spirit and strategic convergences in the Indo-Pacific region are likely to continue to provide momentum to the bilateral relationship.

The growing recalibration of the US role may impact the modus operandi that may avowedly seek to undo some of the policies of the preceding administration. India has maintained a deft political poise befitting its foreign policy orientation. It allows a politically comfortable bandwidth to work with either a Democrat or a Republican President in the US. This approach in India’s foreign policy orientation has been appreciated by recent administrations in the US, allowing for a broad range of issue-based cooperation while still keeping fundamental differences in core interests at bay. This mutual understanding is likely to continue to guide India-US relations under President Joe Biden. India should, however, watch out for any unintended consequences of the Biden administration’s undoing of Trump’s foreign policy legacy that may impact US-India relations, or indeed India’s regional or global interests.

The recent successful visit of Prime Minister Narendra Modi to the USA robust the strategic and mutual partnership in the long run where it contours joint development of Open Radio Access Networks, quantum computing, and artificial intelligence, innovations under the iCET initiative, the establishment of a semiconductor assembly and test facility in India, rare earth and minerals security, collaboration in space exploration, the resolution of trade issues and establishment of new consulates therefore, leading these two states ahead with technology diplomacy. Notably, mutual interdependence has to be fulfilled by consolidating bilateral relations where India cannot fulfil its potential without a closer partnership with the US, especially in the high-tech sector, and the US cannot hope to ensure a multi-polar Asia without a robust relationship with a strong and resilient India.

India, on the other hand, is the world’s most populous democracy and a credible voice of the Global South. Presumably, India’s posture toward global and regional trade has left India on the outside looking in as the regional trade landscape has transformed during Modi’s tenure. His government’s most troubling decision, out of fear of Chinese goods flooding the Indian market, was to withdraw from the Regional Comprehensive Economic Partnership (RCEP), which was finalized in November 2020. India may never have been ready to be a part of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade agreement, the highest-standard Asia-Pacific trade pact and the third largest in the world. And despite its prior interest, India has been on the outside of the most inclusive Asia-Pacific trade forum in the region – Asia-Pacific Economic Cooperation (APEC) bloc that aims to enhance regional economic integration through consensus. It is pertinent to observe the geopolitical context of ties, where a shared sense of rivalry with China between New Delhi and Washington will create opportunities for closer bilateral ties, the economic challenges facing the United States and India in the Covid-19 era will create counter currents.

Finally, a Biden administration will be faced with a problem that the Trump administration neglected entirely – India’s growing democratic deficit. Two of the original justifications for the United States to actively support India’s rise – its economic promise and its shared values – are therefore in some doubt.

The United States should invite India to participate in the summit and encourage it to take on a leadership role to “renew the spirit and shared purpose of the nations of the Free World.” India has much to offer the world. While differences exist on particular issues, the U.S.-India relationship is strong enough for the administration to navigate bilateral concerns while reasserting U.S. leadership in the defence of democracy and human rights on the world stage. However, this will not be possible until the United States and India address their significant differences in data governance. India has alarmed US technology and financial companies through some of its proposed rules on data localization and e-commerce as it is shaping its entire digital regulatory framework. Therefore, the Biden administration would be wise to institute a bilateral dialogue track focused on digital cooperation, to identify shared standards for cross-border data flows.

Some differences over the nature of the current global order, which resists genuine reform of multilateral institutions, need not come in the way of a deeper partnership. The fact is, neither India nor the US can take the other for granted. Both countries must make continuous efforts to improve ties, as in any relationship. Paradoxically, the continuity in India-US partnership of convenience unravelled in recent years, but only after China became the world’s second-largest economic and military power. Notably, the two had no shared values, and it hardly mattered to either side. The close partnership between a democratic India and a democratic US is far more sustainable in the long run.

By: Kashif Anwar, Research Analyst, GSDN

Introduction

A military coup and ousting of democratically elected Niger President Mohamed Bazoum on July 26, 2023, created a crisis in this West African nation. The crisis has created a truly geopolitical moment for intra-African politics and opened the door for external powers to interfere in the domestic affairs of  Africa. The coup has created a tumultuous order in the country, and the use of force to remove Niger’s military Junta could spark a refugee crisis and regional war. Such instability and panic in Niger could expand in its neighbouring countries impacting most global power’s strategic interests, financial stake and role of their military presence in the country and the West African region. Niger is a landlocked country that sits on a large reserve of uranium and oil and continues to be a Heavily Indebted Poor Country (HIPC) whose economy continues to depend upon subsistence agriculture and the export of raw commodities. Such an economic state and the impact of the coup could only result in a rise of the refugee crisis and bloodshed in Niger.

The nation has witnessed coups and political crises since its independence from France in 1960, and the victory of President Mohamed Bazoum on April 2, 2021 became Niger’s first President to witness a democratic transfer of power since its independence. West looked Niger as a bulwark to stop the spread of Islamist insurgency, disorder and spread of Russian influence in West Africa, hosting the US and French military bases. Post-coup, the military Junta ended such military cooperation and agreements with France and the US, increasing the scope and presence of Russian influence in Niger. The ongoing instability, violence and disorder in Mali, Burkina Faso and Libya will impact Niger’s border areas, impacting its security and stability, with spillover from such nations in Niger becoming another challenge for the Junta.

The Coup and its Impact

Considering Niger’s long history of instability, violence and infighting, the 2010 Constitution approved through referendum restored civilian rule in the country. As Niger has witnessed two failed coup attempts in 2015 and 2021, victory of President Bazoum in April 2021 was viewed as a landmark in Niger’s history, witnessing its first peaceful transition of power since 1960. Leader of the Presidential Guard, General Abdourahmane Tchiani, also known as Omar Tchiani removed President Bazoum, becoming the latest coup in Niger’s history. The event has pushed Niger into another tumultuous period and is at a critical juncture to act upon carefully.

The name of Omar Tchianai and his role emerged in a past military coup. He labelled the Bazoum government responsible for the deteriorating bad governance and was dissatisfied with the government’s inability to handle national security matters. Meanwhile, the growing role of Russia’s Wagner Group in Mali pushed France to reduce its diplomatic presence and military role under the UN-led MINUSMA peacekeeping mission in Mali. It allowed President Bazoum to welcome France under its renewed strategy to create a buffer between Niger and other West African nations against the Islamist state and Al-Qaeda’s destabilising effect. However, ousting of President Bazoum has tempered such partnership and fight against Islamist insurgency.

Post-ousting, the Economic Community of West African States (ECOWAS), a group of 15 West African countries, came into action to take necessary military action against the Junta government and impose sanctions against Niger’s Junta to bring peace and restore democracy in Niger. Nigeria’s President Bola Tinubu, who is also the Chairman of the ECOWAS, argues that any interference in the democratic governance and ill-treatment of ousted President Bazoum will not be accepted by the leadership of the body. A military response from ECOWAS against Junta remains an option at a time when the US is praising Tinubu’s leadership and emphasises that they support ECOWAS’s response and action to restore constitutional order in Niger. However, the prosecution of President Bazoum will push the bloc to take stringent means as severe financial transactions, closing the border and stopping electricity supplies and Niger’s imports.

As General Tchiani argues, he has evidence to back his claim to prosecute the ousted President Bazoum for high treason who has undermined the country’s internal and external security. Mixed signals are coming from Niamey, Niger’s capital, concerning Tchiani’s stance, saying it had learned of the threats with stupefaction. Such stance represents another form of provocation as ECOWAS argues it contradicts the report of the Junta’s willingness to restore constitutional order through peaceful means. On the other hand, the African Union (AU), on Tchiani’s defiant stance, argues that diplomacy is the viable solution to such a crisis and has called for better treatment of oust President Bazoum.

President Bazoum’s ouster, who witnessed two coups before, coupled with the military takeover in Mali and Burkina Faso has unleashed a shockwave in West Africa, disturbing peace and stability in the Western African region. As the ECOWAS has approved the deployment of standby forces to restore constitutional order in Niger as a hard means to compel the Military Junta to restore democracy in the country. Meanwhile, Tinubu argues that a military takeover of a government is no longer acceptable in Africa, and all options are being considered with the use of force as a last resort.

The Great Power’s Geopolitics in Niger – Russia and the US

Niger has strategic significance for the US, Russia, Europe and China because of its vast reserves of uranium and oil, and viewed as a hub for foreign powers like the US and France, who have military bases in the country to fight against regional Islamist insurgency in the West African region. Since coup, western powers and many African governments have called for the release of detained President Bazoum and to bring back peace and democracy in Niger by Junta. With more African governments falling to the military coup and Niger being the latest victim, Africa and its vast, diverse and rich resources have transformed the continent into an arena of great power competition. The military coup in Niger has allowed the US to expand its influence and counter Russia and China’s reach and dominance in the continent.

Russia has warned any military intervention by the ECOWAS in Niger would only lead to a protracted confrontation destabilising the Sahel region – adjacent to Niger and Mali. With the Wagner chief Yevgeny Prigozhin welcoming the military takeover in Niger and offering his services to Military Junta, the US blamed the group is taking advantage of the situation. As the US called Military Junta to step aside and restore the country’s democratic constitution; on the other hand, on the ground support for the military and Russia and its influence in the country is visible and alarming for the West. The support for Russia has surged in Niger since the coup, with Military Junta’s supporters waving Russian flags in rallies showing support to the military and Russia while calling France to disengage from the country.

However, whether it was Mali and Burkina Faso in the past or Niger today, such coups show the government’s inability to address the nation’s poor economic and social governance coupled with the threat of Islamist terrorism. Niger’s military close connection with the Russian through the sale of arms or relationship with the Wagner group is one example of Russia’s reach and influence in Niger. West and many scholars argue that from Sudan to Mali to Burkina Faso to Niger, such coups show a similar trend or resemblance of subversion of national government and Russian involvement. However, the second Russia-Africa summit held recently in July in St. Petersburg has strengthened the relationship between Africa and Russia and recognised the relevance of the Global South.

However, a rise in coups in Africa highlights Russia’s ambition and aggressive strategy in Africa. Recent coup in Niger helps to illustrate many issues in world politics, like the happenings in Africa are interconnected and are determined by the great power competition. As Niger Junta received support from Russia, the rise in Russian influence in Niger and Africa has worried the West. Firm support towards Russia in Niger allowed Russia to warn the US and French-backed ECOWAS from taking any military action against the Junta.

The Military Junta has taken an anti-West stand and is inching closer towards Russia, which is highlighted by locals waving Russian flags and showing support to the Junta in their anti-West protests and rallies. The military coup clarifies Russia’s instrument of power, tactics and goals for nations in Africa and explains why Russia didn’t disband the Wagner after their June mutiny, as they’re central to Russia’s global strategy. Despite the West’s superior aggregate power in all dimensions, they failed to develop an idea to have coordination between them to have a comprehensive strategy for Africa, as the West hasn’t appreciated the rising importance of African countries to the global contest which is underway today.

Conclusion

Concerning West’s role in African nations, it’s not too late to have a strategy to counter Russia and its Wagner group’s role, influence and relevance among the African people. The West needs to acknowledge Russia and Wagner’s popularity and support among many African nations can’t be matched and should counter it strategically. Considering the economic state of Niger or other HIPC nations in Africa, strategic investment and economic cooperation from the West is highly needed. Niger’s current state is a reflection and an alarm to West that they need to acknowledge the relevance of African nations and should widen their perspective when looking at African nations. The locals and external players and powers involved in Niger’s situation need to ensure the developments shouldn’t spill out and become a major issue engulfing and impacting other nations in West Africa. Thus, all channels and means must be used, from diplomacy to ensuring communication is established to deploying hard approaches to bring peace and constitutional order back in Niger.

By: Sanoop Suresh, Research Analyst, GSDN

Pretoria’s backing for Moscow is distinctive in the global order, despite the nation’s meagre trade and cultural connections with the Kremlin. South Africa’s trade with Russia is the lowest among the BRIC nations, comprising only 2.29% of its trade with BRICS nations. Nevertheless, despite their claim of neutrality, South Africa and Russia have a friendly connection that dates back to the USSR, when Moscow decided to aid the anti-apartheid resistance of African people. When no one else was willing to do so, the Soviet Union gave the African National Congress (ANC), which is currently in power in South Africa, significant and essential military and financial assistance. The Russia-Ukraine crisis has highlighted the close relations between South Africa and Russia. With several African countries, South Africa also abstained from voting in the UN General Assembly to denounce Russia’s invasion of Ukraine last October. South Africa’s relations with the US, another significant regional actor, were frequently strained due to Pretoria’s tilt towards Moscow. Both Russia and the United States seek to win over the so-called Global South by isolating their respective counterparts. Given the criticism Russia has gotten from other African countries, the Kremlin is especially keen to maintain good relations with South Africa.

Tensions between Russia and African Countries

The ties between Russia and the African nations became sour after Russia’s ‘special military operation’ in Ukraine began in February 2022. Due to their reliance on those countries for agricultural supplies like wheat and sunflower oil, the developing countries of Africa were the accidental victims of the Russia-Ukraine conflict. Over 70% of the world’s sunflower oil, as well as over a third of its wheat and barley, are exported by Russia and Ukraine. Russia’s invasion of Ukraine produced food shortages around the world, especially in Africa, which sparked inflation and social unrest there and hampered the already fragile economies of these countries as they attempted to recover their position following the global epidemic. Despite Moscow’s desire to play a more significant role in the region, African countries are beginning to question the credibility of the Kremlin due to its misplaced priorities and broken promises.

Intending to become a significant force in the Global South, Russia used a variety of strategies, including their allies’ becoming adversaries like the Wagner Group, resulting from sanctions and isolation from much of the Western world. The second Russia-Africa summit, which came after the first one in 2019, was held in Johannesburg on July 27-28, 2023, to attract more allies among the African leaders. However, the conference caught attention for its underwhelming attendance, which signals that African leaders are possibly deserting the Kremlin. Despite the Kremlin’s diplomatic push in Africa, only 17 African leaders attended the Russia-Africa summit, which is fewer than half the number that participated in the previous one in 2019.

Africa’s mistrust of the Kremlin is primarily due to Moscow’s broken pledge to raise trade with the continent to US$ 40 billion annually. The Chinese activities in the African continent and the Western sanctions on Russia leave little space for a proactive role for Moscow. Nevertheless, the fallout of the Black Sea grain initiative between Ukraine and Russia regarding its export to the global market, is the pressing issue of the moment in the Russia-Africa relationship.

The UN initiative has two components. Firstly, it ensures that Russian food and fertiliser reach international markets to avert famine and reduce food insecurity worldwide. Secondly, it allows commercial food and fertiliser export, including ammonia, from three crucial Ukrainian ports on the Black Sea: Odesa, Chornomorsk, and Yuzhny/Pivdennyi. The agreement, signed on July 27, 2022 is the most significant negotiation success the international community has achieved since the beginning of the war. Thirty-three million tonnes of grain departed Ukrainian ports in the year leading up to July, despite the stark lack of trust, which led to a drop in high grain prices globally. According to reports, low and middle-income countries profited more from this program. Moscow’s recent and unexpected withdrawal from this deal hampered these states’ expectations of the Kremlin.

Nevertheless, several African governments have reacted strongly to Russia’s withdrawal from the agreement. The head of Kenya’s foreign affairs ministry, Korir Sing’Oei, wrote in a tweet last week “The decision by Russia to exit the Black Sea grain initiative is a stab in the back at global food security prices and disproportionately impacts countries in the Horn of Africa already impacted by drought.”. Despite the anxiety in relations between Russia and Africa, as well as the disapproval of the West, the third-largest economy on the African continent continues to seek to maintain friendly ties with Moscow.

Complex ties between Moscow and Pretoria

The International Criminal Court (ICC) issued a warrant for Russian President Vladimir Putin’s arrest on March 17, 2023, for war crimes and crimes against humanity. As a signatory to the 1998 Rome Statute, South Africa must detain Putin and send him to The Hague. The Rome Statute calls for under Article 59.1, that “A State Party which has received a request for provisional arrest or for arrest and surrender shall immediately take steps to arrest the person in question in accordance with its laws and provisions.”. Since the summit is supposed to happen in August 2023, Pretoria is desperately seeking a way to avoid this commitment since the President of South Africa thinks that arresting the Russian President would be equivalent to a ‘declaration of war.’ This recent controversy surrounding Putin’s rumoured trip to South Africa to attend the BRICS meeting once again exposed the nuanced relationship between South Africa and Russia.

Although South Africa tries to be outspoken about its loyalty to non-alignment and peace efforts, Pretoria demonstrates a tilt toward Moscow by defying Western demands to isolate Russia. Most crucially, its inclination is not at all covert. In February 2023, the South African Navy participated in a 10-day naval drill with Russia and China. This practice occurred after South Africa abstained from a UN vote denouncing the invasion. Additionally, it declined to impose sanctions against Russia despite the Western push. High-level diplomatic missions sent by Pretoria to the Kremlin further fuelled doubts about South Africa’s purported neutrality.

Scholer claims multiple reasons for South Africa’s inclination to favour Moscow. First, the ANC wants to thank Moscow for supporting the anti-apartheid movement with crucial financial and strategic support when no one else was willing to do so. Second, Pretoria doesn’t want to maintain a hostile alliance with a superpower. Nonetheless, the fundamental driver for South Africa’s decision to preserve tight links with Africa is the belief that a multipolar world will give South Africa’s voice greater weight than a unipolar world. However, South Africa’s friendly relations with Russia cause rifts in its relations with the United States.

Unanswered questions on the US-South Africa Relationship

South Africa’s refusal to sever its links with Russia upset the West, especially Washington. Despite efforts on all sides to allay their fears, there has been little success. South Africa is an essential component of Washington’s strategic jigsaw puzzle because it makes up a vital buffer against the rising influence of Russia and China on the continent, which the U.S. cannot afford to lose. However, recent developments do not favour Washington.

In May 2023, Reuben Brigety, the U.S. Ambassador to South Africa, accused South Africa of secretly shipping weapons to Russia via a cargo ship linked to a sanctioned Russian corporation. Washington accused Pretoria of arming Russia, which led to significant concerns about the country’s purported neutrality, and called for a redrawing of relations between the U.S. and S.A., which had severe ramifications. Due to South Africa’s allegedly “deepening military relationship” with Russia, several U.S. congressmen have demanded that the US-Africa trade meeting scheduled for later this year in South Africa should be held elsewhere.

Similarly, South Africa also faces the risk of losing the advantages of the African Growth and Opportunity Act (AGOA), which gives exports from eligible nations preferential access to the U.S. market. In the first three months of this year, South Africa’s exports to the U.S. via AGOA totalled around US$ 1 billion, making it the second-biggest beneficiary of the program behind Nigeria. Removing these benefits would be disastrous for the nation.

Pretoria’s relationship with Washington will depend on how South Africa engages with Moscow in the future. As a result, South Africa will have to choose between the United States and Russia. Given its financial dependence on Washington, it is doubtful that South Africa will select Russia over the United States. If the Kremlin does not bridge the gaps between its interests and those of Africa, it risks increasing isolation. Because of these factors, South Africa and the African continent will likely play a prominent role in the great power struggle between Russia and the United States.  What will this power game do for the region is the crucial question. Time alone has the answer to that query.

By: Hitti Chopra, Research Analyst, GSDN

The NATO members gathered at Lithuania on July 11-12, 2023 bringing the 31 allies together in Vilnius, which is just 20 miles from Belarus, a Russian ally. The meet was attended by anticipated member Sweden, newly acceded Finland, assorted non-NATO members and Ukrainian President Volodymyr Zelensky_. 

North Atlantic Treaty, also known as Washington Treaty was formed in response to USSR Joseph Stalin’s attempt to bring states under communist rule. NATO considers Russia as a revisionist and belligerent power and their history is tied together since 1949. From the fall of Berlin wall in 1989 with 16 countries as members to collapse of USSR in the 1990s to leading to total up to 31 members, with Finland being the latest member onboard, NATO today has a total 31 members. The allied unity of NATO especially since Russia aggression against Ukraine is paving the way for the re-emergence of NATO which had lost its essence since 1990s.

The position on Ukraine’s admission in NATO was the key question at the summit and it was decided that the “We will be in a position to extend an invitation to Ukraine to join the Alliance when Allies agree and conditions are met.” This position cogitates about the United States and its ally’s perspective to curtail any risk involving Russia accentuating the conflict in Ukraine and beyond. The NATO members came to a conclusion that not now, but sooner or later Ukraine will be a part of NATO, signalling a commitment, support which is a roadblock in Russia’s motive. Russia since the beginning has been a firm believer of curtailing the expansionist motive of NATO which has been exposed with Finland and Sweden now part of the US ally organization.

Turkey, initially was not in favour of Sweden accession in NATO, but the former agreed which can increase the obstacles for Russian government. For the longest period of time, Turkey was pro-Russia, but since the re-election of Turkish President Recep Tayyip Erdogan, the leader is on the move of mending ties with the West. Russia has criticized this twitch by Turkey and reportedly the country officials have been suggesting that Turkey is turning into an “unfriendly country.”

China has been independently supporting Russia against its war with Ukraine. From establishing parallel financial institutions to aid Russia, to strengthening its hegemony over regions considered a strategic monopoly of the West, like Taiwan, China has been assertive and focused on countering the rising American leadership precondition in global matters.

The NATO summit in Vilnius, Lithuania was attended by global leaders like Prime Minister Anthony Albanese of Australia, Prime Minister Chris Hipkins of New Zealand, Prime Minister Fumio Kishida of Japan, and President Yoon Suk-yeol of South Korea. The NATO summit in Madrid (2022) released its Strategic Concept which expressed and revealed the Chinese ambitions vis a vis Asia-Pacific- which is important for the NATO in an interconnected world.

The summit exhibited Joe Biden’s diplomatic strategy by partnering with those like-minded countries as it not only serves the purpose of countering China but at the same time it reflected the awareness of its European allies, highlighting that the security of the Indo-Pacific and Euro-Atlantic regions are closely interconnected. The partnering of NATO with like-minded countries in the Chinese dominated areas like cyber defence, arms control, technology, hybrid threats, and climate change (which have been a challenge for the NATO member states initially) is in anti-Beijing interest. China expressed its concerns over the NATO summit being held at Lithuania by a warning “any act that jeopardises China’s legitimate rights and interests will be met with a resolute response.”

The presence of the West and its allies in Tokyo or Asia can be observed as a threat to the neutrality that is often preferred by small nation states as well as raises concerns over strategic interests for ASEAN and South Asian countries. The NATO plans and presence of its allies in regions which are in close proximity to China brings an echo of the Cold War bloc politics. The international treaties of the post-Cold War era need to cater to the global dynamics of the 21st century and its integral that it aligns and simulates with the realities of today.

By: Aqib Rehman, Research Analyst, GSDN

The Maldives, an enchanting archipelago of coral islands nestled in the Indian Ocean, has garnered significant attention from world powers in recent years. Despite its small size, the Maldives holds geopolitical importance due to its strategic location, natural resources, and economic potential. This article delves into the reasons why major global players are keenly interested in the Maldives and how their engagements shape the geopolitical landscape in the region.

1. Strategic Location

The Maldives’ strategic location at the heart of the Indian Ocean makes it a highly attractive asset for world powers. Situated along vital sea routes that connect Asia, Africa, and the Middle East, the Maldives serves as a maritime crossroads for trade and energy flows. Controlling or influencing this area allows nations to project their naval power, secure access to key shipping lanes, and safeguard their interests in the Indian Ocean region.

Furthermore, the Maldives’ proximity to other strategically significant areas, such as the Arabian Sea and the Bay of Bengal, enhances its value as a potential base for military operations or intelligence gathering. World powers seek to establish alliances and partnerships with the Maldives to enhance their geopolitical reach and influence in the Indian Ocean.

• Maritime Security and Anti-Piracy Efforts

As a nation surrounded by vast stretches of ocean, the Maldives has experienced challenges related to piracy and maritime security. Global powers are eager to collaborate with the Maldives in anti-piracy efforts to safeguard critical sea lanes and ensure the free flow of trade. By joining forces with the Maldives, world powers can demonstrate their commitment to ensuring stability in the Indian Ocean, which directly impacts global trade and energy supplies.

• Resource and Energy Potential

The Maldives holds promising potential in terms of natural resources, particularly in the area of offshore energy reserves. As global energy demands continue to rise, major powers are eyeing the Indian Ocean as a new frontier for oil and gas exploration. The Maldives, with its extensive Exclusive Economic Zone (EEZ), offers opportunities for hydrocarbon exploration and extraction, attracting the interest of resource-hungry nations.

Additionally, the Maldives boasts a rich marine ecosystem and abundant fisheries, which are vital for food security. World powers seek to engage with the Maldives to secure access to these valuable resources, strengthening their economic ties with the nation and potentially establishing long-term trade partnerships.

• Geopolitical Competition

The Indian Ocean region has witnessed increasing geopolitical competition among major powers seeking to assert their influence and dominance. China’s ambitious Belt and Road Initiative (BRI) has driven its engagement in the region, including significant investments in Maldivian infrastructure projects. India, traditionally the Maldives’ close ally, views these developments with caution and has sought to reassert its presence in the archipelago.

The United States and other Western nations are also keen to maintain their influence in the region, ensuring that it remains open and free from undue external pressure. The Maldives, being a part of this complex geopolitical landscape, becomes a focal point for strategic manoeuvring and diplomatic engagement.

World powers’ engagement with the Maldives is also driven by geopolitical posturing and influence in the Indian Ocean. A stable and cooperative relationship with the Maldives can provide strategic advantages, such as access to forward operating bases, intelligence gathering posts, and the projection of influence in regional affairs.

Given the Maldives’ status as a member of regional organizations like the Indian Ocean Rim Association (IORA) and the South Asian Association for Regional Cooperation (SAARC), world powers seek to leverage their engagement to shape diplomatic outcomes and enhance their geopolitical position in South Asia and the broader Indo-Pacific region.

• Climate Change and Environmental Concerns

As a low-lying island nation, the Maldives is highly vulnerable to the impacts of climate change, including rising sea levels, coastal erosion, and extreme weather events. The potential submergence of these islands makes the Maldives a symbol of the urgent need for global action on climate change.

World powers with a commitment to environmental stewardship seek to engage with the Maldives in climate change mitigation and adaptation efforts. By offering support for sustainable development projects and renewable energy initiatives, these nations aim to build positive relationships and influence Maldivian policies on environmental protection.

• Economic Interests and Soft Power Diplomacy

The Maldives’ economy heavily relies on tourism, making it an attractive destination for investment from world powers seeking to gain economic advantages and expand their global influence. Foreign direct investment in tourism infrastructure, hospitality, and real estate projects allows world powers to strengthen economic ties with the Maldives and boost their soft power in the region.

Moreover, cultural and educational exchanges, humanitarian aid, and developmental projects provide avenues for world powers to project their soft power and foster goodwill among the Maldivian population and government.

Interests of different countries

China’s ambitious belt and road initiative is one of the primary interests of China in Maldives. It will help China to achieve its goal of connectivity with other parts of the world. For China, the Maldives serves as an important gateway for maritime trade in the Indian Ocean. The development of ports and maritime infrastructure aligns with China’s broader goal of enhancing its connectivity and expanding its maritime presence in the region. Additionally, Chinese investment in the Maldives has been viewed as a means to secure access to the country’s natural resources and foster long-term economic ties.

India has historically considered the Indian Ocean region, including the Maldives, as part of its strategic sphere of influence. The “Neighbourhood First” policy, pursued by India, emphasizes strengthening ties with neighbouring countries and deepening regional cooperation.

India’s engagement in the Maldives aims to promote stability, security, and economic development in the region. India has invested in various projects, including infrastructure, health, and education, to support the Maldives’ socio-economic growth.

However, India’s influence in the Maldives has faced challenges, particularly during periods of political instability and leadership changes in the country. The Maldives’ delicate balancing act between major powers can lead to fluctuations in its relationship with India.

The United States has expressed its commitment to maintaining a free, open, and prosperous Indo-Pacific region. The U.S. sees the Indian Ocean as a critical area for ensuring maritime security, safeguarding freedom of navigation, and countering the influence of China in the region.

As part of its Indo-Pacific strategy, the U.S. has engaged with countries in the Indian Ocean, including the Maldives, to promote shared democratic values, enhance security cooperation, and advance economic development. The U.S. provides support for capacity-building initiatives in areas such as counterterrorism, disaster response, and maritime security.

The Trilateral Dynamics

The competition between the United States, China, and India in the Maldives creates a dynamic interplay that impacts the archipelago’s domestic politics and regional relations. While the Maldives seeks to maintain friendly ties with all major powers, it must navigate carefully to prevent overreliance on any one nation and avoid being drawn into geopolitical rivalries.

The involvement of world powers in the Maldives has raised concerns over issues like sovereignty, debt-trap diplomacy, and potential military presence in the region. Some critics argue that increased dependence on China for infrastructure development may expose the Maldives to debt risks and reduce its ability to assert its sovereignty.

On the other hand, the competition between the U.S., China, and India also offers opportunities for the Maldives. The country can leverage its geopolitical importance to attract foreign investments, negotiate favourable deals, and secure developmental assistance from different sources.

Conclusion

The Maldives’ strategic location, resource potential, and geopolitical significance have placed it firmly on the radar of world powers vying for influence in the Indian Ocean region. The nation’s allure as a maritime crossroads, its wealth of natural resources, and its vulnerability to climate change have attracted global players seeking to secure their interests, expand their economic foothold, and exercise soft power in the region.

While the Maldives is the subject of intense geopolitical competition, it also presents opportunities for constructive engagement and cooperation among world powers. Striking a balance between fostering economic development, safeguarding maritime security, addressing environmental challenges, and respecting the Maldives’ sovereignty will be crucial in shaping a sustainable and peaceful future for the island nation and the broader Indian Ocean region.

By: Vaibhav Borude, Research Analyst, GSDN

Japan and South Korea established diplomatic relations in December 1965 under the Treaty on Basic Relations between Japan and the Republic of Korea. In this treaty, Japan recognized South Korea as the only legitimate government on the Korean Peninsula. Both of these countries are in close proximity to each other and are major non-NATO allies of the USA; however, the colonial history of Japanese occupation and the turbulent political ties still haunt their relationship.

History of South Korea-Japan relations

Between 1961 and 1979, South Korea’s head of state was dictator Park Chung-hee, who had served in the Imperial Japanese military during World War II.Park took a strong interest in Japanese modernization since he witnessed development policies in Manchukuo firsthand. Under Park’s government, the two countries pursued the 1965 reconciliation treaty, which normalized relations despite considerable public opposition. Park was able to force normalization through the National Assembly and shut down demonstrations through martial law.

As a result, Tokyo provided US$ 300 million as compensation to comfort women, forced laborers, and other victims and extended an additional US$ 200 million credit to Seoul. Prime Minister Sato attended official functions in July, the first visit of a Japanese premier to postwar Korea. Nevertheless, Seoul objected strongly to occasional visits by Japanese politicians to North Korea, to the continuation of Red Cross repatriation of Korean residents in Japan to North Korea, and to the proposal of Tokyo Governor Minobe to permit a pro-North Korean university in Tokyo. The Japanese Foreign Ministry opposed Minobe on this issue in order to prove its loyalty to South Korea. Meanwhile, contacts between Japan and South Korea increased through new air routes, tourism, and trade.

In 1975, South Korean-Japanese relations improved following the end of a two-year-old feud that began when South Korean agents abducted Kim Dae-jung, an opposition leader (and future President of South Korea), from a Tokyo hotel. As a result of the settlement, a long-delayed ministerial conference was held in Seoul in September to discuss economic cooperation between the two countries. Japan joined the United States in providing assurances for South Korea’s security. In a joint statement by Japanese Prime Minister Takeo Miki and U.S. President Ford, they declared: “The security of the Republic of Korea is necessary for peace and security in East Asia, including Japan.”

Thaws in Relationships

• Sea of Japan naming dispute: Japan claims that the Sea of Japan name has been used by western countries since 1860, i.e., before Japan’s colonialism. South Korea claims that the name of the water body is “East Sea”, and it has been used in South Korea for 2000 years.
• The Liancourt Rocks, called Dokdo (“solitary island”) in Korean and Takeshima (“bamboo island”) in Japanese, are a group of islets in the Sea of Japan that are occupied by South Korea. There are valuable fishing grounds around the islets and potentially large reserves of methane hydrates. The territorial dispute is a major source of nationalist tensions between the two nations. Currently, South Korea occupies the island, which has its Korean Coast Guard stationed there as well as two elderly Korean residents.
• Comfort Women’s For Japanese Military: Korea has been demanding official acknowledgement with a sincere apology and compensation for the sex slaves or comfort women issue, referring to the women and girls who were forced to have sex with Imperial Japanese military soldiers during World War II.
• Forced labor of Koreans during World War II
• Discharge of radioactive water from the Fukuchima Daichi nuclear power plant.

Present status and Road ahead

The bilateral trade between South Korea and Japan in 2022 was US$ 85 billion, with South Korea’s export to Japan being US$ 30.6 billion and its import from Japan being US$ 54.7 billion.

The high-level bilateral visit shows the warmth of relations between both countries. The corresponding figure below shows a lack of mutual relations between both of them due to a number of issues, including domestic compulsions.

High-level bilateral visits between Japan and the ROK

The recent summit in March 2023 marked the first meeting between the two nations’ leaders in 12 years and was focused on addressing the shared threat posed by North Korea and growing concerns over China. Post-summit, Japanese Prime Minister Fumio Kishida emphasized opening a new chapter in their bilateral relationship with frequent visits by leaders from both countries that are not bound by formalities. Kishida added that Japan and South Korea have sought to resume bilateral security talks against the backdrop of rising threats from North Korea and have concluded the significance of a “Free and Open Indo-Pacific” (FOIP).

Meanwhile, South Korean President Yoon Suk Yeol expressed his willingness to fully restore the military intelligence-sharing agreement with Japan, which was terminated in 2019 due to an ongoing disagreement regarding forced labor. He added that sharing information regarding North Korea’s nuclear missile launches and trajectories is necessary and that both countries should be capable of responding to them appropriately. Moreover, prior to the summit, Seoul and Tokyo resolved a protracted trade disagreement, with Japan agreeing to remove export controls on advanced materials employed in the manufacturing of semiconductors and display panels to South Korea, while Seoul agreed to withdraw its complaint concerning the limitations at the World Trade Organization (WTO). Thus, the meeting between Yoon and Kishida represents a significant milestone in the efforts to reconcile the long-standing issues and distrust that have plagued the relationship between these two key US allies in Asia.

The Biden administration has been actively pushing for reconciliation and has maintained a steady pace of senior-level trilateral meetings since South Korean President Yoon took charge in May 2022. However, according to the US State Department spokesperson, the recent arrangements between Japan and South Korea were the result of bilateral discussions rather than pressure from the United States. The recent reconciliation between Japan and South Korea has largely been driven by growing security concerns, including North Korea’s blitzkrieg of missile tests, Beijing’s increasingly aggressive military stance, rising tensions in the Taiwan Strait, weak economic growth, inflationary pressure, supply chain resilience, and climate change. There is a significant incentive for the two to work together. Both countries have identified the Taiwan Strait and Indo-Pacific as critical areas for their security, further highlighting the importance of closer cooperation between them. While dealing separately with North Korea, South Korea has rigorously participated in military drills with the US. Similarly, Japan has hinted at its intentions through the adoption of aggressive policies such as the revised National Security Strategy.

The recent bilateral deal attempts to mend relations and restore cooperation by compensating South Korean forced labor victims through a foundation made up of funds from South Korean companies rather than Japanese ones. This is meant to ease tensions over the 2018 South Korean Supreme Court cases and allow Japan to maintain its argument that all claims have been settled by the 1965 treaty and therefore Japanese companies do not need to provide compensation.

While the agreement might be working for the Yoon government, multiple polls also show that about 60 percent of the South Korean public opposes the agreement, suggesting that it may not provide the closure that both governments are seeking. While Japanese Prime Minister Kishida reaffirmed the 1998 declaration in which Japan expressed remorse for its colonial rule, critics have complained that the Japanese side didn’t provide a sincere apology. One victim, Kim Seong-joo, said, “We can forgive; if Japan tells us one word, we are sorry and we did wrong. But there’s no such word.” Claims by Japanese politicians that Japan is “a victim caught up in the [lawsuit]” or that the deal was a “total victory for Japan” because “we didn’t have to concede anything” have only rankled South Korean critics further.

The role ahead for both South Korea and Japan is to forget the past and work towards a prosperous Indo-Pacific region for peace, security, and harmony for all. The political class has taken a step forward with the recent summit; the role of civil society and the media is now important to increase trust between the countries and promote people-to-people contacts to reduce the trust deficit.

By: Vaishnavi Verma, Research Analyst, GSDN

The bilateral relationship between China and Pakistan was established after the 1962 border conflict between China and India. Given the limited prospects for reconciliation between China and India regarding their border dispute, India has emerged as a significant strategic consideration for both nations. In 1963, Pakistan relinquished control of the Shaksgam Valley to China, a territory that was also claimed by India. Subsequently, China extended military support, furnished the necessary resources for the establishment of Pakistan’s nuclear weapons program, and allocated substantial economic assistance to the country. However, it did not fully embrace the relationship with utmost sincerity. There existed a multitude of factors contributing to this phenomenon.

Firstly, it can be argued that China has historically not regarded India as an equal or significant strategic threat. The United States was bestowed with the dubious honor. Therefore, during the armed conflicts between India and Pakistan in 1961 and 1971, China refrained from engaging in military intervention in support of Pakistan. Although there was a public display of support for Pakistan in 1965, the same level of support was not extended in 1971, despite Pakistan’s involvement in facilitating the reconciliation between China and the United States. Moreover, China developed significant apprehension regarding Pakistan’s standing, partly due to its classification as a nuclear-outcast state following the global condemnation of AQ Khan, and primarily due to its role in providing refuge and assistance to Islamist extremists. The ethnic Uighur Muslim community resides in China’s Xinjiang province.

China has demonstrated a longstanding preoccupation with Islamist militancy within the Uighur population, with particular apprehension regarding their alleged connections to militants in Pakistan and Afghanistan. Significantly, China exhibited a degree of detachment from Pakistan both during the Kargil conflict in 1999 and the Mumbai terrorist attacks in 2008.

Nevertheless, during the mid-2000s, two significant factors emerged as crucial. One significant development was the transformation observed in the bilateral relationship between the United States and India. The United States had previously engaged in discussions regarding India as a potential counterweight to China. However, it was the subsequent advancement of their military and economic alliance following the disintegration of the Soviet Union that solidified this notion among Chinese elites. And the occurrence of the Galwan Valley clash might have been influenced by Beijing’s apprehensions regarding Delhi’s growing alliance with Washington at a time when China’s relations with the United States were deteriorating. Consequently, Beijing may have felt compelled to adopt a cautious approach toward addressing the border issue with Delhi. China’s aspirations concerning the global order constituted the second factor. In 2013, President Xi unveiled the Belt and Road Initiative (BRI), a substantial multilateral endeavor focused on infrastructure and investment, aimed at demonstrating China’s unique trajectory of growth and development.

The China-Pakistan Economic Corridor (CPEC) served as the fundamental basis of the Belt and Road Initiative (BRI). China had been providing Pakistan with assistance and support for infrastructure development for a considerable period. However, the China-Pakistan Economic Corridor (CPEC) marked a distinct departure from previous initiatives. The plan encompassed a diverse range of endeavors, such as infrastructure development, energy projects, the establishment of economic zones, and the enhancement of the strategic port, Gwadar. Its total value amounted to an impressive $62 billion. Significantly, the primary purpose of this initiative was to establish a strategic and economic linkage between the southwestern region of China and Pakistan.

The China-Pakistan Economic Corridor (CPEC) presents a viable alternative route to circumvent the Strait of Malacca, which is currently heavily influenced by American military presence and entangled with geopolitical and regional complexities. The economic corridor comprises a comprehensive infrastructure system that encompasses interconnected networks of roads, railways, gas, and oil pipelines as well as designated areas for specific economic activities. The establishment of economic zones throughout Pakistan aims to facilitate economic development. Once completed, this initiative will establish a connection between Kashgar, a city located in the Xinjiang region of China, and Gwadar, a port city situated in the Balochistan province of Pakistan. The Chinese region of Xinjiang is geographically connected to the port city of Gwadar, located in the Balochistan province of Pakistan.

The China-Pakistan Economic Corridor (CPEC) is expected to significantly reduce the transportation distance for Middle Eastern oil supplies. This development will enable China to have the most efficient shipping route available. The success and ambition of the China-Pakistan Economic Corridor (CPEC), a prominent initiative under the Belt and Road Initiative (BRI), played a crucial role in determining the overall success of the BRI. China-Pakistan Economic Corridor (CPEC), which is a component of China’s Belt and Road Initiative, was initiated during the visit of Chinese Premier Li Keqiang to Islamabad in May 2013. During that period, Pakistan was experiencing frequent bomb blasts, persistent power shortages, and sluggish economic growth. China has expressed its dedication to actively participating in Pakistan’s economy, as Li urged both nations to concentrate on implementing crucial initiatives in areas such as connectivity, energy development, power generation, and the advancement of the China-Pakistan economic corridor.

The capacity of China to exert influence on the economy of Pakistan has experienced significant growth in recent years, primarily attributable to Beijing’s status as the largest creditor to Islamabad. Based on the documentation disclosed by the finance ministry of Pakistan, the aggregate amount of Pakistan’s external debt, including both public and publicly guaranteed debt, was recorded at $44.35 billion as of June 2013. Notably, a mere 9.3 percent of this debt was attributed to China. According to the International Monetary Fund (IMF), as of April 2021, the external debt of Pakistan had increased significantly to reach $90.12 billion. Out of this total, China held a substantial portion, with Pakistan owing 27.4 percent, equivalent to $24.7 billion, of its overall external debt to China.

CPEC (China- Pakistan Economic Corridor)

The “China-Pakistan Economic Corridor” (CPEC) was formally initiated during Chinese President Xi Jinping’s visit to Pakistan in April 2015. The focal point has transitioned towards the augmentation of power generation in Pakistan, with projected expenses experiencing a significant escalation to a staggering sum of 46 billion USD. Subsequently, the two governing bodies meticulously devised a comprehensive “Long Term Plan,” commencing in the year 2017 and significantly elongating the envisaged timeframe for execution, extending it until the year 2030. The anticipated expenditures have experienced an upward trajectory, reaching a staggering sum of 62 billion USD, with Pakistani authorities subsequently alluding to even more elevated figures.

COMPONENTS OF CPEC

1. Potential Growth Prospects in the Power Sector of Pakistan

Pakistan’s economy is confronted with a substantial obstacle in the form of a severe energy shortage. The occurrence of frequent blackouts has harmed both the domestic and industrial sectors. The crisis precipitated a significant cessation of industrial operations on a broad scale. The China-Pakistan Economic Corridor (CPEC) presents a significant opportunity to address the issue of excessive load shedding and mitigate the disparity between energy supply and demand. According to the Ministry of Planning, Development, and Reform, the energy sector is one of the corridor’s primary focuses. The early harvest program is anticipated to generate a total of 10,400 megawatts. The early harvest initiative includes nine coal, seven wind, three hydro, and one HDVC transmission line project. Timeline-wise, most early harvest initiatives are done. Electricity production and availability to households and businesses have increased.

In 2013, Pakistan experienced a daily load-shedding duration exceeding ten hours. By the year 2018, a substantial decrease had been observed in the majority of regions across the country. The Sindh province in Pakistan possesses significant coal reserves, particularly in the Thar region. Presently, there are several projects underway in Thar aimed at generating a total capacity of 4000 MW. These projects are currently in the construction phase. An additional amount of US$ 33 billion, which comprises a significant portion of the total. More than 70% of the total investment is allocated to the power sector, which includes the fuel, power, and coal sectors. An additional allocation of $2.5 billion has been made for the establishment of liquefied natural gas (LNG) pipelines to facilitate transportation from Iran to Nawabshah in Sindh and Gwadar in Baluchistan.

• Infrastructure for transportation

The transport and communication sector of Pakistan represents a significant domain of investment. Pakistan has been allocated a substantial amount of $11 billion to enhance its transportation infrastructure. The development in question pertains to the construction of a 1,100-kilometer motorway within the urban area of Karachi, situated along the coast. The proposed transportation link from the province of Sindh to the city of Lahore in Punjab is anticipated to facilitate economic expansion and enhance internal connectivity. The implementation of contemporary transportation systems, including the renovation of existing ones such as the Karakorum Thruway connecting Rawalpindi and Kashgar, as well as the Karachi-Peshawar railroad line, is underway. 820 KM a lengthy fiber optic cable will be installed to connect Rawalpindi and Khunjerab. A dry port is planned to be established in Havelian, Khyber Pakhtunkhwa (KPK). Other transit-related CPEC initiatives include the Orange Line Lahore, the Quetta Mass Transit system, and the Karachi Circular Railway. CPEC aims to establish connectivity between Pakistan and other regions of Asia, Europe, and Africa. This initiative envisions Pakistan playing a pivotal role as a hub for service and manufacturing activities within the region.

• Economic Zones

The expansion of territorial networks holds great significance within the overall project of the China-Pakistan Economic Corridor (CPEC). The expansion of the territorial network will be achieved through the establishment of Special Economic Zones (SEZs) aimed at fostering industrial development in key financial centers and strategically important regions in Pakistan. The initiation of work on Special Economic Zones (SEZs) is planned for the second phase of the China-Pakistan Economic Corridor (CPEC). During the initial phase of the project, a total of forty-six Special Economic Zones (SEZs) were initially planned. However, as the project progressed, the number of planned SEZs was subsequently reduced to nine. The proposed initiatives encompass the creation of the Bolan industrial zone, Allama Iqbal Industrial City M3, ICT Model Industrial Zone, and Rashakai Economic Zone.

And recently China has provided Pakistan, which is facing financial difficulties, with a significant financial support of US$700 million. This aid comes at a crucial time as Pakistan engages in negotiations with the International Monetary Fund (IMF). Additionally, there is a possibility of an additional US$ 1.3 billion in loans from China, which could serve to enhance Pakistan’s foreign exchange reserves.

BENEFITS OF CPEC TO PAKISTAN

CPEC provides the opportunity to integrate economies to end the region’s protracted conflicts. Additionally, it would provide employment and prosperity for millions of people in both nations.

• CPEC offers a stable commercial transit route for Pakistan and China, boosts regional economic growth, and counterbalances Indian influence.
• By becoming a transit trade route for international commerce, Pakistan would increase employment, reduce poverty, and create stability and prosperity by occupying people in economic and commercial activity.
• Furthermore, the China-Pakistan Economic Corridor (CPEC) has the potential to attract significant foreign investment, which could contribute to the growth of Pakistan’s export sector and lead to an increase in its Gross Domestic Product (GDP). The expansion of trade and business opportunities in Pakistan will be facilitated.
• As the corridor traverses Pakistan, the construction of CPEC offers Pakistan the opportunity for infrastructure development and economic growth throughout the entire province.
• Khyber Pakhtunkhwa and Baluchistan, which are far behind in development, would get infrastructure and economic boosts. Pakistan’s Gilgit Baltistan province has this socio-economic development potential. Pakistan relies on marine commerce. Gwadar port development and connection will relieve Karachi and Bin Qasim ports.

GEOPOLITICAL IMPLICATIONS

The increased rift in US-Pakistan relations provides Beijing with an opportunity to promote a new model of international development to replace the predominant US model, which is founded on the “carrot and stick” doctrine. China introduced the Belt and Road Initiative (BRI), a geo-economically ambitious model, based on the principles of “wide consultation, joint development, and mutual benefits,” to promote regional development. This approach appears to be more comprehensive and inclusive. The alternative model is more practical and logical compared to the US model. CPEC has garnered widespread support across various regions of Pakistan as a component of the Belt and Road Initiative (BRI). In recent times, China has successfully organized the inaugural trilateral summit involving China, Pakistan, and Afghanistan to facilitate diplomatic discussions between Pakistan and Afghanistan. Russia is significantly concerned about the China-Pakistan Economic Corridor (CPEC) project due to its implications for China’s growing influence and presence in the Central Asian region. The region has long been considered to fall within the sphere of influence of Moscow. Presently, there is an observed escalation in the competition between Moscow and Beijing in their efforts to cultivate amicable relations with neighboring nations. Another area of concern pertains to multiple countries.

There is a sense of concern among individuals in Asia and other regions, such as the United States, regarding the geostrategic implications of the Belt and Road Initiative (BRI). Nevertheless, China has recently made efforts to address these concerns by emphasizing the “win-win” paradigm of the initiative. The endeavors of this initiative will yield noteworthy foreign policy ramifications for several prominent regional stakeholders, including India the countries of Russia, and Japan.

The rapid ascent of China is also perceived to evoke feelings of insecurity within Western nations. The Western nations persist in perceiving China through the lens of the historical “Qing Dynasty Era,” thereby demonstrating a disregard for China’s maritime capabilities. China’s foreign relations are founded upon principles of engagement, dialogue, accommodation, reconciliation, the promotion of peaceful coexistence, mutual trust, security, balance, and harmony.

The United States perceives the China-Pakistan Economic Corridor (CPEC) as a significant undertaking that will contribute to the concept of regional connectivity and collective economic growth. Additionally, the US foresees the potential for Afghanistan’s future participation in CPEC. The United States is cognizant of the ongoing progress of the China-Pakistan Economic Corridor (CPEC), which may result in China acquiring a prospective naval challenge within the Indian Ocean region. The United States is providing strategic leverage to India to enable India to uphold its regional dominance.

The United Arab Emirates (UAE) also exhibits a vested interest in the development of the China-Pakistan Economic Corridor (CPEC). Ports play a crucial role in facilitating economic growth in the United Arab Emirates (UAE). The full operationalization of the Gwadar port is expected to have a direct economic impact on the volume of business conducted at the Dubai port.

By: Varshitha Eddula, Research Analyst, GSDN

SCO

The Shanghai Cooperation Organisation-Council of Heads of State meeting, hosted by Prime Minister Narendra Modi, marked the first time India chaired the summit of regional countries. India became a full SCO member in 2017, along with Pakistan. The Shanghai Cooperation Organisation focuses on cooperation with international and regional organisations. The strengths of the Shanghai Corporation Organization are that it covers 40% of the global population, nearly 20% of the global GDP and 22% of the world’s land mass. The SCO has a strategically important role in Asia due to its geographical significance, this enables it to control Central Asia and limit the American influence in the region.

BRICS

BRICS (Brazil, Russia, India, China, and South Africa) is an important grouping bringing together the major emerging economies of the world. According to World Bank data of 2019, it comprises of 41% of the world population, having 24% of the world GDP and over 16% share in the world trade. BRICS countries have been the main engines of global economic growth over the years.

Over some time, BRICS countries have come together to deliberate on important issues under the three pillars of political and security, economic and financial, and cultural and people-to-people. 

The central objective of BRICS is the reformation of global governance institutions (UNSC, IMF, World Bank) reflecting the changing nature of the global financial order. It is also an advocate of multipolarity and involves in various activities, including counter-terrorism and developmental activities. It was in this regard that BRICS formed the New Development Bank (NDB) to finance the infrastructure development in emerging economies.

China and SCO

China is one of the six founding members of the Shanghai Cooperation Organisation (SCO), which was established in 2001 as a regional organisation for non-traditional security cooperation between China, Russia and four Central Asian states: Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Although the SCO Charter sets out a broad array of objectives and potential areas of cooperation, the SCO has so far focused on, and gained most visibility through, its fight against regional terrorism, ethnic separatism and religious extremism.

For China, as for the other members, the SCO represents a new and unique cooperation model, reflecting its vision of a multipolar world order as opposed to cooperation models based on US hegemony and unilateralism. Since the SCO’s inception, China has pushed its agenda and has successfully pursued its national security, geopolitical and economic interests. It has used the SCO umbrella as a multilateral platform to address external threats posed by non-state actors on its vulnerable western border; to gain a strong economic and political foothold in Central Asia without putting the Sino-Russian strategic partnership at risk; and to enhance its energy security through large-scale infrastructure investment in, and trade with, the Central Asian member states.

China and BRICS

China sees natural common ground with emerging economies, especially in the pursuit of a new international economic order and the democratization of international relations.

For China, since the BRICS countries’ share and importance in the world economy has been growing but has not yet surpassed the developed countries’, the next step, naturally, would be for them to act as one group to increase their collective voice and bargaining power against traditional developed countries. In China’s view, this momentum would democratize international relations by offering developing countries more voice and rights.

In Chinese strategic thinking, the BRI and BRICS are deeply interconnected. BRICS, comprising the world’s best performing emerging economies, is a less controversial platform and more appealing to the developing world. It is often seen as the key international mechanism that can act as the second front or as the “leading geese”, aiding and advancing China’s BRI objectives. As China-US rivalry intensifies and the BRI faces a plethora of challenges, BRICS is increasingly gaining significance for China.

Within the grouping, China sees itself as the ‘core’ of BRICS, while India as its weakest link. Brazil and South Africa are often dismissed as “free-riders”, while Russia is considered the main tool to advance Chinese interests within the BRICS framework. China is aiming to undercut the role and agency of India, Brazil and South Africa—if possible, winning over the last two using its financial heft—while utilising China-Russia ties as the bedrock for further developing BRICS in a direction that suits their interests.

It is not always easy for China to implement such a strategy. Brazil and South Africa, with their deteriorating economic performance and unstable domestic political situations, are unwilling to commit much to China and thereby compromise on their foreign policy flexibility. On the other hand, there is a constant game between China and Russia over who will use whom, to further its self-interest.

It is against this backdrop that China is proposing a BRICS expansion. Economic strength and development potential are not the sole criteria for China while considering potential BRICS members. Political and identity commonality in the context of China-US competition, geographic and locational advantages, willingness to support the BRI, are seen as important points. India needs to accurately grasp the geopolitical shifts taking place within BRICS and deftly navigate the complex dynamics between the member states to safeguard its own interests within the grouping and avoid being drawn passively into China’s Great Game.

India and SCO

India’s association with the SCO began in 2005 as an Observer country, and it became a full Member State at the Astana Summit in 2017.The government has held that joining the originally Eurasian group was important as it focuses on regional security and connectivity — areas key to India’s growth and making up its challenges, such as terrorism in Pakistan, and Chinese aggressions as well as the Belt and Road Initiative. Being “inside the tent” is important, especially as Pakistan is a member, even if that means conducting joint exercises under the SCO Regional Anti-Terrorist Structure. SCO gives India an interface with Central Asian markets and resources. India-Central Asia Dialogue is a platform to engage with Central Asian Region. But SCO far outweighs India Central Asia Dialogue. Finally, joining the SCO was a key part of India’s stated ambitions on “multi-alignment” and “strategic autonomy” while becoming a “balancing power” in the world.

It was expected that India’s turn to chair the SCO this year would be a major event, rivalling the expected pomp around the G-20 meet in September. In addition, given Russia’s and China’s blocks on the G-20 joint communiqué that India is keen to find consensus on, the SCO summit would have been a convenient venue for Mr. Modi to negotiate a resolution with his counterparts. However, India’s decision to postpone the SCO summit due to the Prime Minister’s U.S. State visit, and then to turn it into a virtual summit may have been a dampener on the SCO outcomes.

India’s concerns with hosting Xi Jinping given the LAC hostilities, or Pakistan Prime Minister Sharif’s possible ‘grandstanding’, or even the optics of welcoming Russian President Vladimir Putin may have been factors. Whatever the reason, while the members hammered out a New Delhi declaration and joint statements on radicalisation and digital transformation, the government was unable to forge consensus on other agreements including one on making English a formal SCO language, while India, despite being Chair, did not endorse a road map on economic cooperation, presumably due to concerns over China’s imprint.

India and BRICS

BRICS’s development-focused diplomacy resonates strongly with India’s core interests – energy security, combating terrorism, and climate change financing. At the same time, its wider and deeper issue items and agenda separate BRICS from other strategic forums that India currently participates in. BRICS constantly emphasizes themes ranging from “promoting economic recovery,” “expediting implementation of 2030 agenda on sustainable development,” and “strengthening and reforming multilateral governance.” These further reflect the socioeconomic realities that developing countries face. India’s global aspirations and interests, such as on reforms in multilateral institutions like the International Monetary Fund, WTO, United Nations, and U.N. Security Council are also backed by BRICS.

BRICS gives India the opportunity to voice its developmental interests in a way that no other grouping can match. In addition, BRICS members are playing a greater role in shaping the global political landscape, an area where India finds itself standing against the likes of the United States, Japan, and Australia – fellow members of Quad. In the contemporary world, BRICS represents global socioeconomic realities that are often relegated to the periphery of international politics. Indian strategic circles recognize BRICS’s primary role in shaping the international trade order, climate change policies, financing, and reformed multilateralism. New Delhi aims to play a larger role in international politics and negotiations, which would further emphasize the critical role of BRICS.

To ensure a multi-polar Asia, it is imperative for India to prevent China from increasing its area of influence through organizations like SCO and BRICS. It is also in the interest of Washington since it does not want these groupings to be echo chambers of Sino Russian axis.

The biggest challenge that India faces as a member of BRICS is China. China is actively trying to use BRICS to further its sphere of influence and to make it an anti-west group which is evident from the Chinese push for expansion of membership as well as from its stance on common currency for BRICS nations. While India, with its strategy of issue-based alignment or multi-alignment, requires BRICS for active engagement with emerging economies and for furthering its interests. While there is a call for India to come out of BRICS, it seems better for India to create a room in BRICS rather than give it away for China to further its interest. It should ensure that it does not become an anti-west grouping by making sure that new membership to the group does not take place in such a way that ensure China’s dominance. A common BRICS currency is not in the interest of India since it may affect its engagement with the West.

SCO-CHINA-BRICS-INDIA

BRICS should have balanced itself against Chinese hegemony by reviving the spirit of the India-Brazil-South Africa (IBSA) grouping, which predated BRICS. Had the IBSA spirit worked, then China and Russia would not have held sway over BRICS. Instead of the IBSA spirit, divergent reactions from South Africa and Brazil have emerged.

China will use these institutions for disseminating President Xi Jinping’s vision of international order like the Global Security Initiative and Global Development Initiative. China is trying to have a domination in these groupings and make them anti-USA and G7. China floated the idea of a common currency at BRICS. But India disapproved. China wants to expand the groupings through giving membership to countries, which are inherently pro-China. Many SCO and BRICS members are recipients of China’s investments through BRI. China will always aim to have greater influence over members in these organisations. But decisions in BRICS and SCO are taken on a consensus. Trying to ease out India from these groupings is difficult for China. As India has significant friendly relations with other member countries. Secondly, India is an important trading partner with China. Therefore, India and China are tangled up multilaterally and bilaterally.

By: Sanoop Suresh, Research Analyst, GSDN

After Narendra Modi took the oath of office in 2014, India started a journey towards deeper ties with the United Arab Emirates, and the Indian Prime Minister visited the UAE five times in the eight years afterwards. When he made his maiden trip to the UAE in 2015, Modi became the country’s first prime minister to do so in 34 years. Modi’s visit to Abu Dhabi was well received, and the following year, the ruler of the UAE, HH Sheikh Mohamed bin Zayed Al Nahyan, paid a visit to India and later served as the chief guest at the Republic Day celebration in 2017. Over the past nine years, India and the UAE’s diplomatic and economic ties have expanded. According to official figures from the UAE, there are close to 3.5 million Indian nationals living there, making them the country’s largest ethnic group with almost 30% of the total population. As a result, the UAE is a significant player that India cannot afford to risk losing. Despite the hurdles that still lie ahead, Narendra Modi’s recent day-long visit to Abu Dhabi on July 15, 2023 offers signs of a win-win situation for both India and the UAE.

What is the outcome of this visit?

The Indian Prime Minister concluded his tour after attending various discussions on subjects ranging from economics to climate change by writing on his Twitter account, “India and UAE will keep working closely to further global good.” The main objective of the talks, according to the PMO’s official statement, was to further solidify the trade and economic ties between the two countries. In these discussions, both countries underlined their commitment to the promotion of robust and resilient food supply chains, and sought the possibilities of cooperation and diversification in the health sector. The discussion between the Indian Prime Minister and HH Sheikh Mohamed bin Zayed Al Nahyan, President of the UAE, also emphasized bilateral cooperation in the energy sector, including oil, gas, and renewable energy.  Additionally, both parties agreed to enhance investments across the board in the energy sector, including the Strategic Petroleum Reserve Programme of India. Both leaders called on the international community to preserve the long term goals of the Paris agreement and display their solidarity on “the principles of equity and common but differentiated responsibilities and respective capabilities, considering the diverse national circumstances of each nation”, as outlined in the agreement. However, the highlight of this trip was the signing of three MoUs between India and the UAE.

The tripartite Memorandum of Understanding agreed for establishing the first-ever IIT Delhi international campus in Abu Dhabi is a significant development of Modi’s visit to the UAE. In order to operationalize IIT Delhi-Abu Dhabi by January 2024 with a Master’s programme in Energy Transition and Sustainability, the Indian Institute of Technology (Delhi), Ministry of Education, and Abu Dhabi Department of Education & Knowledge (ADEK) signed the MoU. This is a follow up to the Virtual Summit between the two leaders, which occurred in February last year, when they agreed to establish the Indian Institute of Technology in the UAE. The Reserve Bank of India and the Central Bank of the UAE also signed two other Memoranda of Understanding on the same day, and it is expected that these agreements would fundamentally alter commerce between India and the UAE.

Why will these MoUs become a game changer?

Owing to the Comprehensive Economic Partnership Agreement signed on 18 February 2022, the UAE emerged as the third biggest trade partner in terms of USD $85 billion for the fiscal year 2022–2023 and the second largest export destination. With this deal, India was granted preferential market access for 97% of its tariff line in a number of industries, including pharmaceuticals, medical equipment, automobiles, jewelry and gemstones. The newly signed MoUs sought to better simplify business relations between the two nations. One among them calls for the collaboration of the Fast Payment Systems (FPSs) of the two nations, the Unified Payments Interface (UPI) of India and the Instant Payment Platform (IPP) of the UAE. It also seeks to connect their payment messaging systems as well as card switches (UNSWITCH and RuPay switches).

The second MoU pushes forward for greater cooperation in trade through establishing a mechanism to promote local currencies, which is Rupees and Dirham, for Cross-border Transactions by creating a Local Currency Settlement System (LCSS). According to this, exporters and importers would be able to invoice and pay in their respective home currencies, which would promote the growth of a foreign exchange market for the INR and AED. As transaction costs and settlement times are lowered, it is anticipated that a greater usage of local currencies will benefit Indians residing in the UAE in general and low-wage employees in particular. It should be noted that these initiatives coincide with India’s efforts to reduce its reliance on the US Dollar through extending the use of the INR.

At the Micro level, Banks from 18 countries, including the UK, Germany, Malaysia, Israel, and Russia, approved to open Vostro accounts for rupee trade, and Bangladesh, Sri Lanka, and Indonesia showed interest in local currency trade. India expects that such agreements will increase currency stability and minimize the volatility in international commerce relative to the value of the US dollar. On a macro level, the US dollar’s dominance is occasionally questioned, and more nations are attempting to trade in their own currencies to protect bilateral commerce from external fluctuations. Despite the fact that India and the UAE assert that there is no plan to “de-dollarize” the world economy by citing the bilateral character of this agreement, this initiative drives the efforts in that direction. Although this visit and the associated agreements can be seen as a step forward in India and the UAE’s relationship, it is also under the shadow of uncertainties and challenges.

Why isn’t it a straight road for India and UAE?

Although there is a leap in the India-UAE trade share as a result of the CEPA of 2022, the disparity in the Import-Export rate is considerably huge and these statistics raise some questions regarding the future of the India-UAE agreement on the use of local currency in bilateral trade. According to data released by the Indian Embassy in the United Arab Emirates, the value of bilateral commerce between New Delhi and Abu Dhabi surged by 68.3% in the fiscal year 2021–2022 compared to the prior year, totaling USD 72878.31 million. However, there is a 16,788.55 million USD deficit in Indian exports to the UAE. According to their most recent estimate, this disparity persisted in 2022–2023 between April and September with an imbalance of $12,341.51 million USD. This disparity leaves Abu Dhabi with an excess of INR and raises the question of whether this agreement will take the same trajectory as the debate over trade in rupees and rubles. To get around all of these concerns, India has to increase its share of bilateral trade, and New Delhi expects the CEPA will make that possible.

Another hurdle in their usually cordial relationship is the deadlock in their negotiations to revise the 2014 Air Service Agreement (ASA). The UAE ambassador to India noted that “it would be difficult to accommodate the new demands for travel between the two countries” unless India agreed to find common ground in modifying ASA. The Ministry of Civil Aviation expressed reluctance to expand the number of seats between UAE cities and around 15 Indian cities due to worries that it may hurt Indian airlines’ business, which led to a 45–50% spike in airfare in the nation’s major cities. Breaking through these impasses and locating a common ground is crucial to enhancing the connection between the two nations when we take into account the significance of India-UAE ties and the recent developments signal a more promising future for both countries.