Rebalancing Asia: The Belt and Road Initiative and Indo-Pacific Strategy 9811637563, 9789811637568

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Pramod Jaiswal Deepak Prakash Bhatt   Editors

Rebalancing Asia The Belt and Road Initiative and Indo-Pacific Strategy

Rebalancing Asia

Pramod Jaiswal · Deepak Prakash Bhatt Editors

Rebalancing Asia The Belt and Road Initiative and Indo-Pacific Strategy

Editors Pramod Jaiswal Nepal Institute for International Cooperation and Engagement Kathmandu, Nepal

Deepak Prakash Bhatt Department of Conflict, Peace and Development Studies Tribhuvan University Kathmandu, Nepal

ISBN 978-981-16-3756-8 ISBN 978-981-16-3757-5 (eBook) https://doi.org/10.1007/978-981-16-3757-5 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Singapore Pte Ltd. The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721, Singapore

Acknowledgement

The book Rebalancing Asia: Belt and Road Initiative and Indo-Pacific Strategy is the outcome of the combined effort of the authors of various papers incorporated in the book along with our personal contribution as the author and editor. Hence, we would like to express our gratitude to Dr. Shutaro Sano, Professor at Nihon University College of International Relations; Captain (Dr.) Nitin Agarwala, Indian Naval Officer; Rana Divyank Chaudhary, researcher at the Indian Think tanks; Dr. Li Li, Associate Professor at College of International Development and Global Agriculture, China Agricultural University; Dr. Jin Liu, Associate Professor of School of Humanities and Social Science at Beijing Institute of Technology; Dr. Katja Banik, editor-in-chief of PwC’s China Compass; Dr. Jan Lüdert, Associate Professor at the City University of Seattle; Dr. Sebastien Goulard, manager of Cooperans and coordinator of the OBOReurope; Dr. Mukda Pratheepwatanawong, Researcher at Institute of Asian Studies, Chulalongkorn University; Dr. Bhavna Singh, former Associate Fellow at the Centre for Air Power Studies and Senior Research Officer at the Institute of Peace and Conflict Studies (IPCS), New Delhi; Dr. Sanchita Bhattacharya, Research Fellow in Institute for Conflict Management, New Delhi; and Dr. S Binodkumar Singh, a Research Associate at Institute for Conflict Management, New Delhi. Our thanks also go to other authors Dr. Hoimonti Barua, a Research Officer at Centre for Participatory Research and Development, Bangladesh and Visiting Fellow at Nepal Institute of International Cooperation and Engagement (NIICE), Nepal; Dr. Alessandro Albana, Associate Research Fellow at the Asia Institute, University of Bologna; Antonio Fiori, Associate Professor of History and Institutions of Asia at the University of Bologna and the President of the Asia Institute; Zhang Sheng, Research Fellow of the Chengdu Institute of World Affairs, China; Paul Antonopoulos, Bureau Chief for Greek City Times in Athens; Arturo Gallegos García, lecturer at the Law Faculty of Friedrich-Schiller University in Jena, Germany; Dr. Drew Cottle, Adjunct Fellow in History and Politics at Western Sydney University; Asantha Senevirathna, Senior Lecturer at the Department of Strategic Studies at the General Sir John Kotelawala Defence University, Ratmalana, Sri Lanka; Tony Tai-Ting Liu, Assistant Professor at National Chung Hsing University, Taiwan; and v

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Acknowledgement

Dr. Kimberley Anne Nazareth, Faculty at Global Politics at Bombay International School and Behzad Abdollahpour, independent researcher from Iran. We would also like to thank Sumitra Karki, Sunaina Karki and Sumnima Karki, the Research Associates of Nepal Institute for International Cooperation and Engagement (NIICE), for their support in finalizing the book. Last but not least, we would like to thank Springer for providing all help and support for the publication of this book. Dr. Pramod Jaiswal Dr. Deepak Prakash Bhatt

Contents

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Rebalancing Asia: Belt and Road Initiative (BRI) and Indo-Pacific Strategy (IPS). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Pramod Jaiswal and Deepak Prakash Bhatt

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Japan’s Free and Open Indo-Pacific Vision: In Overcoming the Geostrategic Dilemma. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Shutaro Sano

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China’s Geopolitical, Geoeconomic and Geostrategic Gameplay in the Indian Ocean Region. . . . . . . . . . . . . . . . . . . . . . . . . . . . Nitin Agarwala and Rana Divyank Chaudhary

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Connectivity, Cooperation and Collaboration: China-South Asia Partnerships Under the Scientific Belt & Road Initiative. . . . . . . Li Li and Jin Liu

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Spatial Conquest by Other Means: Assessing the Geopolitical Impact of China’s Belt and Road Initiative. . . . . . . . . . . . . . . . . . . . . . . . Katja Banik and Jan Lüdert

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Europe and the US-China Confrontation in the Indo-Pacific. . . . . . . . Sebastien Goulard

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Opportunities for New Trend of Labour Mobility from Vietnam as a Result of Doi Moi, ASEAN Connectivity and Belt and Road Initiative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mukda Pratheepwatanawong

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BRI and the Indo-Pacific: Narratives of Traders and Warriors on the Silk Road. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Bhavna Singh

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CPEC: The Buckle in China’s BRI. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109 Sanchita Bhattacharya

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Contents

10 China’s Belt and Road Initiative and Its Concerns for India. . . . . . . . . 119 Binodkumar Singh 11 China’s Maritime Ambition in South Asia vis-à-vis Bangladesh: A Concern for India?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133 Hoimonti Barua 12 China and the BRI: Challenges and Opportunities for Southeast Asia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149 Alessandro Albana and Antonio Fiori 13 BRI Manifesting the Rise of an Eastern Civilizational State and Its Implication to the World. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 Sheng Zhang 14 Sitting on the Fence? Australia’s Balancing of the Belt and Road Initiative and Indo-Pacific Strategy in the New Multipolar World System. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169 Paul Antonopoulos, Arturo Gallegos García, and Drew Cottle 15 Belt and Road Initiative (BRI) and Indo-Pacific Strategy (IPS): Challenges and Opportunities for Sri Lanka. . . . . . . . . . . . . . . . . 181 Asantha Senevirathna 16 Go South Towards the Indo-Pacific: Taiwan, Korea and Japan’s Policy Response Against the BRI. . . . . . . . . . . . . . . . . . . . . 193 Tony Tai-Ting Liu 17 The US and the Indo-Pacific: Trump’s Policy Towards the Region Dr. Kimberley Anne Nazareth. . . . . . . . . . . . . . . . . . . . . . . . . 205 Kimberley Anne Nazareth 18 Belt and Road Initiative Versus Indo-Pacific Strategy: Increasing US-China Strategic Distrust. . . . . . . . . . . . . . . . . . . . . . . . . . . 221 Behzad Abdollahpour

Editors and Contributors

About the Editors Dr. Pramod Jaiswal, Ph.D., is Research Director at Nepal Institute for International Cooperation and Engagement (NIICE), Kathmandu. He is Faculty at Department of International Relations and Diplomacy and Department of Political Science at Tribhuvan University; Visiting Faculty at Pokhara University, Army Staff and Command College and Kathmandu University. He is also associated with Institute of Peace and Conflict Studies (New Delhi) as Senior Fellow and Cooperative Monitoring Center, Sandia National Laboratories (USA) as Visiting Fellow. He has previously worked at Fudan University (Shanghai), Tongji University (Shanghai), China Foreign Affairs University (Beijing), Qinghai University of Nationalities (Xining) and Institute for Defence Studies and Analyses (New Delhi). Dr. Deepak Prakash Bhatt, Ph.D., is Founding Chairperson of Nepal Center for Security Governance (NCSG). He served as a member of the Technical Committee and Secretariat of the Special Committee for Supervision, Integration and Rehabilitation of Maoist Army Combatants from March 2009 to December 2012. He holds Ph.D. from School of International Studies, JNU, and is Faculty at the Master’s in International Relations and Diplomacy (MIRD), Department of Conflict, Peace and Development Studies (DCPDS) and Institute of Crisis Management Studies (ICMS), Tribhuvan University, and Visiting Professor, Armed Police Force Command and Staff College, Kathmandu, Nepalese Army Higher Command and Management Course, Nagarkot and Nepalese Army Command and Staff College (ACSC), Shivapuri, Kathmandu.

Contributors Behzad Abdollahpour Faculty of World Studies, University of Tehran, Tehran, Iran ix

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Editors and Contributors

Nitin Agarwala Research Fellow at the National Maritime Foundation, New Delhi, India Alessandro Albana Asia Institute, Bologna, Italy Paul Antonopoulos Aristotle University of Thessaloniki, Thessaloniki, Greece Katja Banik PwC’s China Compass, Hamburg, Germany Hoimonti Barua Research Fellow, Centre for Research and Development, Bangladesh, India Deepak Prakash Bhatt Visiting Faculty At Several Universities of Nepal and Member of Committee of International Affairs and Member of Parliament, Kathmandu, Nepal Sanchita Bhattacharya Institute for Conflict Management, New Delhi, India Rana Divyank Chaudhary University of Delhi and a Ph.D. Candidate At Department of East Asian Studies, Research Fellow in Defence and Strategic Studies, University of Delhi, Delhi, India Drew Cottle Western Sydney University, Penrith, Australia Antonio Fiori University of Bologna, Bologna, Italy Arturo Gallegos García Friedrich-Schiller University, Jena, Germany Sebastien Goulard Cooperans, Paris, France Pramod Jaiswal Research Director of Nepal Institute of International Cooperation and Engagemet (NIICE), Kathmandu, Nepal; Department of International Relations and Diplomacy, Tribhuvan University, Kirtipur, Nepal Li Li College of International Development and Global Agriculture, China Agricultural University, Beijing, China Jin Liu School of Humanities and Social Science, Beijing Institute of Technology, Beijing, China Tony Tai-Ting Liu Graduate Institute of International Politics, National Chung Hsing University, Taichung, Taiwan Jan Lüdert City University of Seattle, Seattle, USA Kimberley Anne Nazareth Jawaharlal Nehru University, New Delhi, India Mukda Pratheepwatanawong Center of Excellence for Mekong Studies, Institute of Asian Studies, Chulalongkorn University, Bangkok, Thailand Shutaro Sano Nihon University College of International Relations, Mishima, Japan Asantha Senevirathna Department of Strategic Studies, General Sir John Kotelawala Defence University, Ratmalana, Sri Lanka

Editors and Contributors

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Bhavna Singh McKinsey & Company, New Delhi, India Binodkumar Singh Institute for Conflict Management, Research Associate, New Delhi, India Sheng Zhang Chengdu Institute of World Affairs, Chengdu, Sichuan, China

Abbreviations

AAGC ACSA ADB ADMM-Plus AEC AIIB ANIs ANZUS APEC ARF ASEAN AUN AUSMIN BCIM BDN BIMSTEC BOT BRI CAFTA CAS CICT CIFC CIIS CIMC CMPH CPC CPCP CPEC CPTPP

Asia-Africa Growth Corridor Acquisition and Cross-Service Agreement Asian Development Bank ASEAN Defense Ministers’ Meeting-Plus ASEAN Economic Community Asian Infrastructure Investment Bank Andaman and Nicobar Islands Australia, New Zealand and United States Security Treaty Asia-Pacific Economic Cooperation ASEAN Regional Forum Association of Southeast Asia Nation ASEAN University Network Australia-United States Ministerial Consultations Bangladesh-China-India-Myanmar Economic Corridor Blue Dot Network Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation Built-Operate-Transfer Belt and Road Initiative China-ASEAN Free Trade Area China Academy of Science Colombo International Container Terminal Colombo International Financial City China Institute of International Studies China International Marine Containers China Merchants Port Holdings Communist Party of China Colombo Port City Project China-Pakistan Economic Corridor Comprehensive and Progressive Agreement for Transpacific Partnership xiii

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DOS EAMF EAS ECT EEU EEZ EPA EU FDI FOIP FTA GDP GoJ GoP GoSL IDFC IFIs IMF INDOPACOM INSTEC IOR IPS IPSR JBIC KMT MCC MDA MNC MoC MOD MOFA MOFCOM MOLISA MPAC MRA MSR MSRI NAFTA NC NDB NDRC NDS NEXI NGO

Abbreviations

Department of State Expanded ASEAN Maritime Forum East Asia Summit East Container Terminal Eurasian Economic Union Exclusive Economic Zone Economic Partnership Agreement European Union Foreign Direct Investment Free and Open Indo-Pacific Free Trade Agreements Gross Domestic Product Government of Japan Government of Pakistan Government of Sri Lanka International Development Finance Corporation International Financial Institutions International Monetary Fund US Indo-Pacific Command International North-South Transport Corridor Indian Ocean Rim Indo-Pacific Strategy Indo-Pacific Strategy Report Japan Bank for International Cooperation Kuomintang Millennium Challenge Corporation Maritime Domain Awareness Multinational Corporation Memorandum of Cooperation Ministry of Defense Ministry of Foreign Affairs Ministry of Commerce Ministry of Labour, Invalids and Social Affairs Master Plan on ASEAN Connectivity Mutual Recognition Agreement Maritime Silk Road Belt Maritime Silk Route Initiative North American Free Trade Agreement Nepali Congress New Development Bank National Development and Reform Commission National Defense Strategy Nippon Export and Investment Insurance Non-Governmental Organisation

Abbreviations

NMF NSS OBOR ODA OPIC OPV PACOM PALM PICs PLA PLAN PPP PRC QUAD RCEP RIIO RMB ROK SAARC SAF SAGAR SCMP SCS SCS SDF SEATO SEZs SLCG SLOC SLPA SOEs SOFA SREB STI THAAD TICAD TPP UK UNCLOS US USAID USD US-SEGA UWARC

xv

National Maritime Foundation National Security Strategy One Belt One Road Official Development Assistance Overseas Private Investment Corporation Offshore Patrol Vessels US Pacific Command Pacific Islands Leaders Meetings Pacific Island countries People’s Liberation Army People’s Liberation Army-Navy Purchasing Power Parity People’s Republic of China Quadrilateral Security Dialogue Regional Comprehensive Economic Partnership Research Institute for Indian Ocean Economies Renminbi Republic of Korea South Asian Association for Regional Cooperation Singapore Armed Forces Security and Growth for All in the Region South China Morning Post Social Credit System South China Sea Self Defense Forces Southeast Asia Treaty Organization Special Economic Zones Sri Lankan Coast Guard Sea Lines of Communication Sri Lanka Port Authority State-Owed Enterprises Status of Forces Agreement Silk Road Economic Belt S&T and Innovation Terminal High Altitude Area Defense Tokyo International Conference on African Development Trans-Pacific Partnership United Kingdom United Nations Convention on the Law of the Sea United States US Agency for International Development US Dollar US-Support for Economic Growth in Asia Underwater Archaeological Research Centre

xvi

UXO WB WTO WWII

Abbreviations

Unexploded Ordnance World Bank World Trade Organization World War Two

Chapter 1

Rebalancing Asia: Belt and Road Initiative (BRI) and Indo-Pacific Strategy (IPS) Pramod Jaiswal and Deepak Prakash Bhatt

“Belt and Road Initiative”, also known as “yi dai yi lu”, is a twenty-first century silk road that is made up of an overland and maritime corridor. According to Green Belt and Road Initiative Center, as of 2021, there are 140 countries part of the Belt and Road Initiative (BRI), spread across all continents which include 40 countries in Sub-Saharan Africa, 34 in Europe and Central Asia, 25 from East Asia and Pacific and 41 countries from the Middle East, North Africa, Latin America, Caribbean and South East Asia. The Chinese President Xi Jinping in 2013 stated that such a network would expand the international use of Chinese currency, the Renminbi (RMB), and “break the bottleneck in Asian connectivity. China’s official policy communiqués further mentions that the initiative as a whole seeks to expand China’s export markets, including the promotion of the Renminbi (RMB) as an international currency, and the reduction of trade frictions like tariffs and transport costs (China Power Team, 2017). The initiative is arguably one of the largest development plans in modern history. The “multibillion dollar” strategy seeks to connect China with South Asia, South East Asia, Africa and Europe via a web of roads, high-speed rail, power lines, ports, pipelines, optic fiber lines and other infrastructure (Jaiswal, 2017). BRI, the brainchild of President Xi Jinping, is one of his most ambitious foreign and economic policies, which aim to improve regional integration, increase trade and stimulating economic growth by ambitious infrastructure building to connect China’s lessdeveloped border regions with neighboring countries to accelerate their development P. Jaiswal (B) Research Director of Nepal Institute of International Cooperation and Engagemet (NIICE), Kathmandu, Nepal Department of International Relations and Diplomacy, Tribhuvan University, Kirtipur, Nepal D. P. Bhatt Visiting Faculty At Several Universities of Nepal and Member of Committee of International Affairs and Member of Parliament, Kathmandu, Nepal © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_1

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(European Bank for Reconstruction and Development, nd). There are several motivators behind China’s BRI. First, it will help China to reduce the transportation costs of goods around the world. Second, China has huge surplus of construction materials. The amount of cement that the US consumed in the entire twentieth century is less than what China consumed between 2011 and 2013 (Swanson, 2015). Hence, China is looking for markets overseas for those excess produced. Third, the infrastructure focus would help China in its quest for greater international stature for its currency as a global reserve currency. Fourth, through the BRI, China would be able to secure energy supply through new pipelines in Central Asia, Russia and Southeast Asia’s deep-water ports. Fifth, the development in infrastructure in countries along the BRI routes would increase growth in their economies which will contribute to a growing demand for China’s goods and services which will strengthen China’s economy (Jaiswal, 2017). Indo-Pacific is originally a geographic concept that spans two regions of the Indian Ocean and the Pacific Ocean (Chen, 2018). Geographically, it includes three parts starting from East African Coast to Indian Ocean to the Western and Central Pacific Ocean. A multi-polar region comprising of 38 countries, sharing 44% of world surface area and a home to 65% of world population, the Indo-Pacific, today is currently contributing almost 62% to the world GDP (The Economic Times, 29 September 2018). The Indo-Pacific Region has become most prominent internationally since last decade with the emergence of Indo-Pacific Strategy (IPS) of the United States. The United States use the term “Indo-Pacific” as rebalancing strategy towards Asia, however, there is no clear and coherent geographic definition of “Indo-Pacific”. Moreover, in April 2014, the Assistant Secretary of the US State Department Bureau of South and Central Asian Affairs described “Indo-Pacific” as “the vast littoral arc stretching from South Africa to Australia” (US Department of State, 2014). The region consists of a vast coastline of 7,500 km and 1,380 islands, more than two million square kilometers of Exclusive Economic Zone, and emerging blue water naval capabilities that proves its significance in the region (Pandey, 2019). IndoPacific is home to world’s most populous countries, various great powers, natural resources and production hubs of Factory Asia—starting from Eastern Africa and going through the East and South Asia all the way to South China Sea, Taiwan, Japan, Indonesia and Australia (Juutinen, 2018). It links Europe and Americas with Asia which is the reason why Indo-Pacific is a key geostrategic and economic area wherein lie tremendous geo-economic opportunities as well as daunting security challenges not only perceived in the case of Asia but also the wider world such as US, the EU and other great powers (Kuo, 2018). The idea of Indo-Pacific is that the Indian and Pacific oceans are increasingly a unified and shared strategic space. This implies that what happens in the Indian Ocean will impact on the Pacific Ocean (Rajagopalan, 2018). The Indo-Pacific, hence is both a strategic as well as an economic domain comprising important sea-lines of communication that connect the littorals of the two oceans. Since it is primarily a maritime space, the Indo-Pacific is associated with maritime security and cooperation (Singh, nd).

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Evolution of Belt and Road Initiative (BRI) and Indo-Pacific Strategy (IPS) China’s President Xi Jinping announced the first part of the “Silk Road Economic Belt” initiative during his official visits to Kazakhstan and Indonesia in 2013. The initiative as per President Xi is a reminiscent of the “Silk Road” established 2000 years ago, during the Han Dynasty (Junfang, 2017). Similarly, the idea of IndoPacific is not a new, nor is it originally an American one. Its origins can be traced to a speech delivered in August 2007 by Japanese Prime Minister Shinzo Abe to the Indian Parliament (Jaishankar, 2018). Moreover, in the year 2007, Gurpreet S. Khurana first employed the term “Indo-Pacific Ocean” to the academic discourse, combining the Indian Ocean region with the Western Pacific region to a single regional construct (Khurana, 2007). Following that the US strategic thinking found strategic validity and promise of the new construct and the US became one of the main purveyors of the Indo-Pacific Ocean concept. The US Pacific Command (PACOM) changed its name to the US Indo-Pacific Command (INDOPACOM) on 30 May 2018 (Keerawella, 2020).

Indo-Pacific Strategy (IPS) in Foreign Policy The evolution of the “Indo-Pacific” concept in regional foreign policy discourse has been an interesting one in the last two decades. The concept has evolved, the way it currently intersects a number of geographical areas, and disciplines and a range of nation states. As a critical part of this evolution, debates on the nature, expanse and strategy with respect to the Indo-Pacific are wide-ranging and intense. The conceptual evolution of Indo-Pacific can be traced with its changing narrative (Mishra, 2019). The usage of the term Indo-Pacific has been figured prominently by US President Donald Trump during his trip to Asia, by Indian President Narendra Modi, the re-emergence and revival of the Quad countries (India, US, Australia, Japan), and the repeated usage of the expression, “Free and Fair Indo-Pacific” on a number of occasions, by top officials of the Trump Administration, including former Secretary of State, Rex Tillerson, the Free and Open Indo Pacific foreign policy initiative by Abe’s administration (2016). Different academics and foreign policy elites perceive it through diverse prisms relating to the concept in terms of their own expectations, objectives and fears in the region. However, the evolution of Indo-Pacific as a strategic concept is a more recent development. The United States government started to use the term “Indo-Pacific” under the Obama administration’s rebalancing strategy towards Asia. However, there was no clear and coherent geographical definition of “Indo-Pacific” under the administration. For instance, the geographical focus of the “Indo-Pacific Economic Corridor” initiative, introduced at the US-India Strategic Dialogue in June 2013 by the former Secretary of State John Kerry, was South and Southeast Asia. Whereas, in

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April 2014, the Assistant Secretary of the US State Department’s Bureau of South and Central Asian Affairs described “Indo-Pacific” as “the vast littoral arc stretching from South Africa to Australia (Haruko, 2020). Likewise, although, a few other countries with rising stakes in the region, including India, Russia and the United Kingdom (UK), have deliberately desisted from putting out a direct policy document on their Indo-Pacific strategy or vision despite high stakes in the region, they are still assessing the conceptual and strategic evolution of the Indo-Pacific. The Indo-Pacific as strategic conception as well as a geographic construct has largely evolved in the last decade, riding on the need to create a shared vision for attaining common regional goals (Mishra, 2019). The significance of the Indo-Pacific is huge for countries inside and outside the region. Several South, Southeast, East Asian and Pacific Island economies including Vietnam, New Zealand, Bangladesh, Sri Lanka and some of the Indian Ocean Rim (IOR) countries have shown interest in joining the Indo-Pacific group (Rahman et al., 2020). It is expected that small states in the South Asia would benefit from growth dynamics of Southeast Asia and East Asia through Indo-Pacific construct (Keerawella, 2020). However, it also depends on how these countries leverage their linkages in the new strategic space to induce the growth centers in Indo-Pacific to transfer cutting-edge technology through investment and expand their market opportunities in Indo-Pacific. Indian GDP and growth could benefit the most. If Southeast Asian (ASEAN) countries become part of the Indo-Pacific block, they can gain significantly through the free trade deal. However, if the trade facilitation increases by 25% among these countries, the potential benefit will be enormous (Rahman et al., 2020). As for Beijing, about 80% of the oil imported is through the Indian Ocean and the Strait of Malacca (Shengming Corridor). The region is important for China from strategic and economic point of view (Miracola, 2018). Additionally, China has been pursuing its port expansion policies, having built ports in Djibouti in the horn of Africa, Gwadar in Pakistan, Hambantota in Sri Lanka, in the Maldives and Tanzania. These ports are in fact regarded to be the strategic support points in order to protect the maritime routes for the transportation of necessary resources for Beijing’s economy and to extend the Chinese influence in the regional and global levels. Though BRI was announced by the Chinese President in 2013, it remained fluid in its nature, goals and design over the years. It has evolved significantly. So is the case with Indo-Pacific Strategy initially. But in recent times, there is rapid progress on the IPS since the 2020 meetings among QUAD countries, but due to the pandemic, around 20% of the large projects of BRI have been halted. However, new transformations like the Digital Silk Road and Health Silk Road have been progressing. Similarly, the Digital Silk road launched in 2015 refers to a series of cable network equipment project, including 5G, data research center, smart city project and large e-commerce and mobile payment deals. Another expansion that happened with the pandemic was the Health Silk Road that was first launched in 2017 under china’s mass diplomacy which includes; donation, consultation and commercial export. The book Rebalancing Asia: Belt and Road Initiative and Indo-Pacific Strategy highlights the geo-political rivalry of China and US for its influence in Asia. While China aims to increase its influence in Asia through its ambitious Belt and Road

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Initiative, US would counter it with the alliance of its partners, namely India, Japan and Australia, through its Indo-Pacific Strategy. The book covers the articles of scholars from 16 different countries where they highlight how both the powers are engaging and competing in different parts of Asia. China wants to engage with countries around the world by providing low interest infrastructure construction offer in the world, while US offers grants. The geo-political competition between the two has already been visible in South Asia and it is going to be more competitive in days to come. Dr. Shutaro Sano in his chapter focuses primarily on cooperation in the security field and seeks to clarify the ways in which Japan can maintain a certain level of autonomy in developing its Free and Open Indo-Pacific (FOIP). He highlights the geostrategic dilemma that Tokyo faces over the United States’ security-oriented FOIP which has a much stronger competitive element than the other versions of FOIP including Japan’s. He argues that while it is imperative that the US maintain its geopolitical presence in the Indo-Pacific and that Japan continues to strengthen its alliance with the US, Tokyo would need to overcome the geostrategic dilemma by expanding its security roles within the Japan-US alliance, developing a legitimate, inclusive and non-security-oriented FOIP, and taking on an influential role as a “middle” power. Captain (Dr.) Nitin Agarwala and Rana Divyank Chaudhary highlight China’s geopolitical, geo-economic and geostrategic gameplay in the Indian Ocean region where he mentions the 2019 Defence White Paper which indicates China’s interests in securing trade routes and access to natural resources beyond the South China Sea. Dr. Li Li and Dr. Jin Liu discuss China-South Asia Partnership under China’s Belt and Road Initiative which they argue, will enhance connectivity, cooperation and collaboration between China and South Asia. Dr. Katja Banik and Dr. Jan Lüdert offer insights into geopolitical shifts resulting from China’s increasing global presence, deepening our understanding of China’s overall security strategy. They foremost consider structural problems and geopolitical challenges resulting from China’s Belt and Road Initiative and argue that BRI is conceptualized as more than an economic and military security arrangement. Moreover, the authors propose to treat BRI as a novel spatial security arrangement and as part of China’s grand strategy for rebalancing global order and concur that while uncertainty persists, conflict resulting from China’s rise is not an inevitability and it remains, in a large part, up to the West to help construct a peaceful future. Dr. Sebastien Goulard looks at Europe and the US-China confrontation in the Indo-Pacific. He argues that despite shared concerns with the US regarding BRI transparency, the European Union has adopted a pragmatic approach of coordination with China through its new EU-Asia Connectivity Strategy, and Chinese influence is growing in most European countries. Dr. Mukda Pratheepwatanawong in her chapter argues that the success of implementing doi moi policies has reformed Vietnam’s economy and promotes Vietnamese associations within and outside Southeast Asia and Vietnam should work to enhance its labour mobility policies and agreements with labour-receiving countries with an objective of providing more opportunities for formal labour mobility to occur through

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Vietnam’s involvement in connectivity projects, which could be done through the structural changes and developments of syllabi in vocational training to improve and complement with the new skills required for students to work locally and within the region. Dr. Bhavna Singh in her chapter draws linkages from historical trade routes to look at India’s growing linkages with the Southeast Asian Region. She argues that ever since the travels of Marco Polo was published, interest in China’s maritime history has been increasing and recently with China projecting its maritime influence in movies like the Wolf Warrior II and similar cases elsewhere, it becomes even more important to decipher what China’s maritime strategy would entail for future traders and warriors. Dr. Sanchita Bhattacharya in her chapter argues that China–Pakistan Economic Corridor (CPEC) has faced several jolts in the restive Balochistan Province and the real challenge is whether best practices can be incorporated in BRI or it will remain only a “Chinese” scheme given that state-owned enterprises play the lead implementing role. Dr. Binodkumar Singh in his chapter discusses India’s concern and responses on China’s BRI and he also highlights that China’s BRI projects such as CEPC undermines India’s sovereignty. Dr. Hoimonti Barua in her chapter studies about Chinese interest in the maritime zone of Indian Ocean region which will progress in three stages. She also analyses the implications of Beijing’s approach to build a Sino-centric maritime environment in the Indian Ocean vis-à-vis Bangladesh on India. Dr. Alessandro Albana and Antonio Fiori highlight how the implementation of the BRI is likely to enhance China’s influence in Southeast Asia and also sheds light on the challenges and opportunities the BRI is determining upon Southeast Asian countries and their relationship with Beijing. Dr. Zhang Sheng in his paper presents the strategic considerations and plans of the BRI project of China and IPS of the US, and also explores the profound significance of the grand change of world order brought by the revival of China and the implementation of the BRI. He argues that the revival of China and the implementation of the BRI is an unprecedented grand change that has never been seen since Western colonialism invaded rest of the world 500 years ago. He concludes that BRI aims to create a new world order in which capitals can freely flow and the developing world can tremendously benefit from economic development of the world, while IPS is the reaction from the West to prevent the rise of the non-Western world and to preserve Western hegemony. The competition between the BRI and IPS is one between geo-economics and geopolitics, economic development and military domination, East and West and most importantly a brand-new future of the world order and the existing world order dominated and kidnapped by the West. Paul Antonopoulos, Arturo Gallegos García and Dr. Drew Cottle explore Australia’s strategic position as being the only country straddling both the Pacific and Indian Oceans, that is also poised between a commitment to U.S. geo-strategy and an increasing reliance on China’s global economic development. They argue that although China is Australia’s primary economic partner, Australia is not a major

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export market or investment site for China. Recently, Australia has been critical of China’s human rights abuses of Uyghurs in Xinjiang, its construction of military installations in the South China Sea as a violation of international shipping and Chinese espionage in Australia. At the same time, Australia continues to serve the military security strategy of the U.S.in the Indo-Pacific region. The twenty-first century was heralded as the arrival of the “Asian Century”, and Australia can be seen as both a key country geographically, in the Asia–Pacific region and in the struggle between China’s Belt and Road Initiative and the US Indo-Pacific Strategy for dominance. Asantha Senevirathna in his chapter examines how Sri Lanka should address the geopolitical challenges posed by global powers via BRI and IPS, and how to gain from opportunities that these initiatives. He argues that Sri Lanka is an island strategically located in the Indian Ocean and it has become a major partner to China’s Belt and Road Initiative (BRI) and several large-scale development projects are being implemented by the Chinese in the country. Similarly, the Indo-Pacific Strategy (IPS), under the leadership of the United States and with the collaboration of other powers in the region, has proposed Sri Lanka with many development initiatives as a counterbalance to BRI. As a small state located in a strategically important position, Sri Lanka is now faced with challenges and opportunities presented by the BRI and IPS. Tony Tai-Ting Liu examines the development of the “Southern” or southward policies of Taiwan, South Korea and Japan, the reception of the policies in the targeted region and their potential challenges. He also raises the number of challenges that undermine the southern/southward strategy as an effective rebalancing act towards the BRI. Dr. Kimberley Anne Nazareth examines the motives and mechanisms of President Trump’s strategy both domestic and international. She argues that on the international front, there has been a growing need to reassure regional allies against China and on the domestic side, during the 2016 presidential campaign, Trump found it beneficial to attack China on an array of issues that pleased his electoral base. Behzad Abdollahpour examines the Belt and Road Initiative and the Indo-Pacific Strategy from both Chinese and US perspectives to gain a deep understanding of them and further discusses some opportunities and challenges they may be faced with, in order to better illustrate the strategic distrust between the US and China.

References Chen, D. (2018). The indo-pacific strategy: A background analysis. Istituto Per Gli Studi Di Politica Internazionale. June 4, 2018. Retrieved November 10 2020, from https://www.ispionline.it/it/pub blicazione/indo-pacific-strategy-background-analysis-20714 Deng, J. (2017). Why is the ‘Belt and road’ initiative important”. CGTN, 11 Jan 2017, Retrieved September 15, 2020, from https://news.cgtn.com/news/3d49444f3463544d/share_p.html European Bank for Reconstruction and Development. (n.d.), Belt and road initiative. Retrieved November 12, 2020, from https://www.ebrd.com/what-we-do/belt-and-road/overview.html

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Haruko, W. (2020). The “Indo-Pacific” concept: Geographical adjustments and their implications. (RSIS Working Paper, No. 326). Singapore: Nanyang Technological University. Retrieved January 12, 2021, from https://dr.ntu.edu.sg/bitstream/10356/143604/2/WP326.pdf Jaishankar, D. (2018). “Indo-pacific: Can an idea shape geopolitics?”, Instituto Per Gli Studi Di Politica Internazionale, 4 June 2018. Retrieved September 15, 2020, from https://www.ispion line.it/it/pubblicazione/indo-pacific-can-idea-shape-geopolitics-20712 Jaiswal, P. (2017). Seizing the ‘Belt and road initiative’ opportunity: Challenges for Nepal. IPCS Comment 5307, 23 June 2017. Retrieved December 5, 2020, from http://www.ipcs.org/comm_s elect.php?articleNo=5307 Juutinen, M. (2018). Indo-pacific dilemma: Between development and geopolitics. ORF, 18 December 2018, Retrieved October 1, 2020, from https://www.orfonline.org/expert-speak/indopacific-dilemma-between-development-and-geopolitics-46335/ Keerawella, G. (2020). Repositioning South Asia in the indo-pacific region: Changing geopolitics and geo-strategies. Regional Center for Strategic Studies. Retrieved January 12, 2021, from https://rcss.org/wp-content/uploads/2020/01/Repositioning-South-Asia-in-the-IndoPacific-Region-Prof.-Gamini-Keerawella.pdf Khurana, G. S. (2007). Security of sea lines: Prospects for India-Japan cooperation. IDSA Strategic Analysis. Retrieved August 12, 2020, from https://idsa.in/strategicanalysis/SecurityofSeaLines ProspectsforIndiaJapanCooperation_gskhurana_0107 . Kuo, M. A. (2018). The origin of ‘indo-pacific’ as geopolitical construct: Insights from Gurpreet Khurana. The Diplomat, 25 January 2018, Retrieved October 14, 2020, from https://thediplomat. com/2018/01/the-origin-of-indo-pacific-as-geopolitical-construct/ Miracola, S. (2018). The indo-pacific “encirclement”: How is China reacting”. Italian Institute for International Political Studies, 4 June 2018, Retrieved September 12, 2020, from https://www. ispionline.it/en/pubblicazione/indo-pacific-encirclement-how-china-reacting-20716 Mishra, V. (2019). Evolution of the indo-pacific: Increasing Russian stakes. ICWA, 23 December 2019, Retrieved September 12, 2020, from https://www.icwa.in/show_content.php?lang=1& level=3&ls_id=4838&lid=3188 Pandey, P. (2019). India-France maritime cooperation in the Indian Ocean: Enhancing the strategic partnership”. ICWA, 24 September 2019, Retrieved September 12, 2020, from https://www. icwa.in/show_content.php?lang=1&level=3&ls_id=4782&lid=2496#:~:text=India%2C%20c entrally%20located%20in%20the,important%20player%20in%20the%20region. Rahman, M. M., Kim, C., & De, P. (2020). Indo-Pacific cooperation: What do trade simulations indicate? Economic Structures, 9, 45. https://doi.org/10.1186/s40008-020-00222-4 Rajagopalan, R. P. (2018). More than just a Buzzword. ORF, 29 August 2018, Retrieved October 14, 2020, from https://www.weforum.org/agenda/2018/09/how-the-indo-pacific-concept-is-cha nging-the-power-dynamics-in-asia/. Reshaping Indo-Pacific Cooperation. The Economic Times, 29 September 2018, Retrieved November, 1 2020, from https://economictimes.indiatimes.com/blogs/et-commentary/reshapingindo-pacific-cooperation/ Singh, A. (n.d.). What does the term Indo-Pacific signifies, as distinct from Asia-Pacific?. IDSA Ask an Expert. Retrieved June 12, 2020, from https://idsa.in/askanexpert/termIndoPacificsignifies Swanson, A. (2015). How China used more cement in 3 years than the U.S. did in the entire 20th Century. The Washington Post, 24 March 2015, Retrieved September, 10 2020, from https://www.washingtonpost.com/news/wonk/wp/2015/03/24/how-china-usedmore-cement-in-3-years-than-the-u-s-did-in-the-entire-20th-century/ Team, C. P. (2020). How will the belt and road initiative advance china’s interests? China Power. May 8, 2017. Updated August 26, 2020. Retrieved December 13, 2020, from https://chinapower. csis.org/china-belt-and-road-initiative/ US Department of State, Remarks by Nisha Desai Biswal, Assistant Secretary, Bureau of South and Central Asian Affairs, on “US Foreign Policy in South Asia: A Vision for Prosperity and Security”. Retrieved April 16, 2014, from https://2009-2017.state.gov/p/sca/rls/rmks/2014/224 914.htm

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Dr. Pramod Jaiswal is a Research Director at Nepal Institute for International Cooperation and Engagement. He specializes on China and South Asia and has done extensive work on Chinese Foreign Policy, China’s South Asia Policy and China’s ambitious Belt and Road Initiative (BRI). His research focus also includes insurgencies, border management, terrorism, illegal migration, radicalism, and ethnic conflicts. He has been a regular and visiting faculty at different universities of Nepal (Tribhuvan University, Kathmandu University, Pokhara University and Army Command and Staff College) and China (China Foreign Affairs University, Fudan University, Tongji University, and Qinghai University of Nationalities). He is a Visiting Fellow at Sandia National Laboratories, Cooperative Monitoring Center, Albuquerque,New Mexico, US and Senior Fellow at the Institute of Peace and Conflict Studies, New Delhi. Previously, he has worked with Manohar Parikkar Institute for Defence Studies and Analyses, New Delhi and as Delhi Correspondent with the Rising Nepal. He is a General Secretary of Center for Diplomacy and Development and the Member of the Editorial Board, Journal of International Affairs, Kathmandu; Member of the Academic Committee at the Pangoal Institution, Beijing; Member of International Advisory Committee, Journal of Liberty and International Affairs, Macedonia; and the Member of the Editorial Board, Gandhara Journal of Research in Social Science, Pakistan and member of Subject Committee of International Relations and Diplomacy, Tribhuvan University. He holds Masters, M. Phil and PhD from School of International Studies, Jawaharlal Nehru University, New Delhi. He has authored, edited and co-edited around dozens of books on China and South Asia affairs. Dr. Deepak Prakash Bhatt is an elected Member of House of Representatives at Federal Parliament of Nepal. He is a Member of International Affairs Committee of the Federal Parliament of Nepal. Dr. Bhatt holds PhD from the School of International Studies, Jawaharlal Nehru University, New Delhi, Previously, he served as a member of High-Level Task Force on Reorienting Nepal’s Foreign Policy, headed by Minister for Foreign Affairs from 2015 to 2017 and as a member of Technical Committee and Secretariat formed under the Special Committee for Supervision, Integration and Rehabilitation of Maoist Army Combatants from 2009 to 2012. He is a Visiting Faculty at the Department of International Relations and Diplomacy (DIRD), Department of Conflict, Peace and Development Studies (DCPDS), TU; Nepali Army Higher Command and Management Course (HCMC), Nagarkot, Army Command and Staff College (ACSC), Shivapuri; Institute of Crisis Management Studies (ICMS), Dhumbarai, APF Command and Staff College, Sanogaucharan. He has participated in the Advanced Security Cooperation course at the DKI Asia Pacific Center for Strategic Studies (APCSS), Hawaii; Study of United States Institutes on Foreign Policy at Bard College, New York; HMG Security and Justice Course at University of Birmingham, UK and Advanced Level Course on Disarmament, Demobilization and Reintegration (DDR) Course of Transition International, the Netherlands. He has keen interest on Democracy, Development, Anti-corruption, Foreign Policy and Security Sector Governance.

Chapter 2

Japan’s Free and Open Indo-Pacific Vision: In Overcoming the Geostrategic Dilemma Shutaro Sano

Abstract In line with the Proactive Contribution to Peace Policy, Japan’s Free and Open Indo-Pacific (FOIP) vision aims to promote fundamental principles, strengthen regional connectivity and ensure peace and stability. The vision is primarily a development-driven initiative, but Tokyo has deepened the linkage between the security and development elements of its FOIP due to the geostrategic cross-border infrastructure developments in the Indo-Pacific region as well as China’s assertive military actions amid growing strategic competition between Washington and Beijing. Challenges exist, however, including the geostrategic dilemma in which Tokyo faces over the United States’ security-oriented FOIP which has a much stronger competitive element than the other versions of FOIP including Japan’s. While it is imperative that the U.S. maintains its geopolitical presence in the Indo-Pacific and that Japan continues to strengthen its alliance with the U.S., Tokyo would need to overcome the geostrategic dilemma by expanding its security roles within the Japan–U.S. Alliance, developing a legitimate, inclusive and non-security-oriented FOIP, and taking on an influential role as a “middle” power. This work focuses primarily on cooperation in the security field and seeks to clarify the ways in which Japan can maintain a certain level of autonomy in developing its FOIP.

Introduction With the shift in the center of gravity to the Indo-Pacific, the Free and Open IndoPacific (FOIP) vision has become one of Japan’s prominent foreign policy since August 2016. The initiative aims to promote fundamental principles, strengthen regional connectivity and ensure peace and stability in the region. While the vision is primarily an inclusive development-driven initiative with an emphasis on regional connectivity in the Indo-Pacific, Tokyo has deepened the linkage between the security and development elements of its FOIP in light of the various geostrategic cross-border infrastructure development projects such as China’s Belt and Road Initiative (BRI) S. Sano (B) Nihon University College of International Relations, Mishima, Japan e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_2

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as well as its assertive military actions in the Indo-Pacific. However, the vision is not without challenges. Most of all, Tokyo is faced with a geostrategic dilemma in determining its long-term strategy: whether to seek a more hardliner approach against countries such as China by transforming its FOIP into a more security-oriented initiative similar to the one adopted by Washington in line with its security ties with the United States; or, whether to develop a legitimate non-security-oriented FOIP that would enable Tokyo to achieve further political support from countries notably the ASEAN countries as well as to possibly evade tensions with Beijing at the expense of potentially raising doubts in Washington towards Japan’s determination to work with the U.S. in coping with the increasingly unstable security environment. The issue for Tokyo is not having to make a critical strategic choice between the U.S. and China per se. The U.S. remains Japan’s most indispensable ally. Rather, the issue is how to increase the level of autonomy in developing its FOIP within the framework of the Japan–U.S. Alliance. This paper argues that, in overcoming the abovementioned dilemma, Tokyo would need to ensure that its FOIP would not be forced to become a security-driven initiative similar to Washington’s so it can function as a legitimate initiative in shaping a peaceful and stable Indo-Pacific region. The article consists of three parts. First, it clarifies the foundation of Japan’s FOIP vision as well as Tokyo’s efforts in deepening the linkage between the security and development elements of the FOIP. The second section analyzes the risks associated with Tokyo’s ongoing efforts in pursuing the FOIP. The last section lays out some policy recommendations in overcoming the geostrategic dilemma amid growing strategic competition between the U.S. and China in the Indo-Pacific.

Foundation of Japan’s FOIP Vision and Its Development The FOIP vision was officially endorsed by Prime Minister Shinzo Abe at the Sixth Tokyo International Conference on African Development (TICAD) in August 2016 in Nairobi, Kenya (Ministry of Foreign Affairs [MOFA] of Japan, 2016). Initially dubbed as a strategy instead of a vision, the initiative called for the need to create a synergy between the two continents (Asia and Africa) and the two seas (the Pacific and the Indian Oceans) in developing a peaceful and stable Indo-Pacific region. Importantly, the foundation of Tokyo’s FOIP was established as early as mid2000s with the shift in the geostrategic environment notably due to the rise of China and India. The FOIP began to take root in Japan’s foreign policy narratives with the implementation of the “Arc of Freedom and Prosperity” in November 2006. The initiative was intended to link the value-oriented diplomacy such as democracy, freedom, human rights, the rule of law and market economy with the outer rim of the Eurasian continent. The arc was wide in scope and stretched from Northeast Asia to Central Asia and the Caucasus, Turkey, Central and Eastern Europe and the Baltic states (MOFA of Japan, 2006). As the special advisor to the second Abe cabinet later noted, the policy was not designed to encircle a specific country (Nippon.com,

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2013). The initiative was later advanced by Prime Minister Shinzo Abe himself when he delivered the “Confluence of the Two Seas” speech to the Indian Parliament in August 2007 during which he emphasized the importance of a “wide, open, broader Asia”(MOFA of Japan, 2007). Having assumed his second term in office in 2012, Abe introduced the “Democratic Security Diamond”, a scheme in which the four major democratic countries in the Indo-Pacific—Australia, India, Japan, the U.S.— would play a greater role in preserving the common good in both regions (Abe, 2012). During the 13th IISS Asian Security Summit in 2014, Abe announced the “Three Principles of the Rule of Law at Sea”, which stressed the importance of (1) making and clarifying claims based on international law; (2) not allowing the use of force or coercion in trying to change the status quo; and (3) seeking to settle disputes by peaceful, diplomatic means (MOFA of Japan, 2014). These initiatives formed the basis for what would become the FOIP in 2016. The FOIP is designed to: (1) promote fundamental principles such as rule of law, freedom of navigation, openness and free trade; (2) strengthen regional connectivity via quality infrastructure, people-to-people exchanges and institutional harmonization; and (3) ensure peace and stability by focusing its efforts on capacity building assistance as well as humanitarian assistance and disaster relief (HA/DR) (Government of Japan [GOJ], 2019). The vision is, as the Abe administration has repeatedly noted, not expected to become an exclusive nor a security-driven initiative that would aim or contain a specific country including China. Nor is it to create a new institution or override/undermine existing organizations (GOJ, 2019). The vision is an open and comprehensive concept that emphasizes the importance of strengthening regional connectivity between Asia, the Middle East and Africa through a broader and deeper cooperation with both regional and external partners in promoting peace, stability and prosperity in the Indo-Pacific region. With the changing international environment since the mid-2010s, Tokyo has strengthened the linkage between the development and security elements of the FOIP. While maintaining the development-driven feature of the initiative, Japan revised the 2003 Official Development Assistance Charter in 2015 which had been heavily development-focused. The 2015 Development Cooperation Charter notifies that Tokyo intends to promote development cooperation in order to contribute more proactively to the peace, stability and prosperity of the international community (MOFA of Japan, 2015a). This was followed by a series of governmental announcements in both the development and security domains. In the development field, Tokyo announced the “Partnership for Quality Infrastructure” initiative in May 2015 and its follow-up in the next year. These were followed by development-related initiatives issued at the G7 Ise-Shima Summit in 2016 and the 2019 G20 Osaka Summit both during which promotion of the quality infrastructure investment was emphasized (MOFA of Japan, 2020). Japan’s FOIP encompasses both the maritime and the overland geographic domains which range from West Pacific in the East to East Africa in the West. While the FOIP incorporates a broad range of geographies, Tokyo has, most importantly, stressed the significance of the ASEAN centrality and has placed it as the central piece of its FOIP vision (MOFA of Japan, 2018a). Southeast Asia is critical for Japan

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as the region is not only located along the vital sea lanes of communication in the South China Sea and the eastern part of the Indian Ocean but also has become the core of regional multilateralism since the end of the Cold War. Notably, Tokyo seeks to enhance connectivity through quality infrastructure in the ASEAN region by, for example, the East–West Economic Corridor and the Southern Economic Corridor. In the security field, the Ministry of Defense (MOD) of Japan has strengthened its efforts in line with the FOIP vision. Notably in July 2019, a FOIP-related position, the Director for Defense Cooperation in the Indo-Pacific Region, was established within the International Policy Division of the Defense Policy Bureau. Furthermore, while the defense exchanges with the ASEAN started from as early as the 1990s, Tokyo has facilitated its efforts to strengthen its ties with the ASEAN countries since the mid-2010s. In November 2016, for example, the MOD launched the Vientiane Vision which sets, in addition to the ongoing cooperation measures with individual ASEAN member states, a framework for a stronger ASEAN-wide cooperation by combining diverse measures. These measures include (1) the promotion of international law especially in maritime security; (2) capacity building cooperation in HA/DR, PKO, landmine and unexploded ordnance (UXO) clearance, cybersecurity, defense buildup planning (sharing know-how); (3) defense equipment and technology cooperation; (4) continued participation in multilateral joint training and exercises; and (5) strengthening of human resource development and academic exchange (Ministry of Defense [MOD] of Japan, 2016). The vision was updated with the introduction of the Vientiane Vision 2.0 in November 2019 which emphasized the importance of redefining the Vientiane Vision in line with the concept of the “Indo-Pacific” (MOD of Japan, 2019). While the defense cooperation with the ASEAN member states remains as the core efforts of the MOD, it has recently broadened its scope of cooperation to include other region and countries as well. In July 2020, the MOD released a document, Achieving the “Free and Open Indo-Pacific (FOIP)” Vision, which emphasized the importance of not only Southeast Asia, but also South Asia, the Pacific Islands, the Middle East, Africa and Latin America. The document also lists specific countries including the U.S., Australia, New Zealand, Canada and India as well as the European countries such as UK and France. This was the first time that the MOD specifically listed the targeted regions and countries with which Tokyo would strengthen its security cooperation in line with the FOIP vision (MOD of Japan, 2020). Meanwhile, Tokyo has strengthened cooperation in maritime security with the regional partners. In May 2019, for example, Japan joined with the other 17 ASEAN Defense Ministers’ Meeting-Plus (ADMM-Plus) grouping to participate in the fourth multilateral maritime security field exercise in Singapore. Moreover, South Asia which comprises countries in the Bay of Bengal has become increasingly important for Japan’s security as the U.S., China and India have recently enhanced their security presence as well as their respective region-wide development initiatives on the periphery of the Indian Ocean in recent years. For Tokyo, the Bay is located northwest of the maritime chokepoint of the Strait of Malacca, and provides the shortest transportation route connecting Europe, Africa and the Middle East to Southeast and East Asia. The ongoing developments of various gas fields such as the

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Krishna-Godavari deep water off the east coast of India could also become significant in meeting Japan’s energy needs in the future. As a result, Tokyo has been strengthening its security cooperation notably with New Delhi through the Special Strategic and Global Partnership which involves a wide and multifaceted areas of cooperation (Sano, 2017). In the security domain, there have been remarkable developments over the past year such as the commencement of the minister-level “2 plus 2” dialogue in November 2019 and the signing of the Acquisition and Cross-Service Agreement (ACSA) in September 2020. With the ACSA in place, the Andaman and Nicobar Islands (ANIs), together with the U.S. base in Diego Garcia, may become key strategic strongholds for future maritime and air operations of the Self Defense Forces (SDF). In addition, Japan has also demonstrated its determination to deepen its security ties with other South Asian countries such as Sri Lanka. In August 2018, Itsunori Onodera became the first defense minister to tour the island’s three major ports, including the Trincomalee port and the controversial Hambantota port. Furthermore, Tokyo has strengthened its ties with the Pacific Island countries (PICs) through summit level dialogue such as the Pacific Islands Leaders Meetings (PALM) as well as its official development assistance (ODA). These efforts are aimed to promote a safer and sustainable environment in the maritime domain including transportation routes and maritime natural resources, which has become critical in conjunction with future development of all countries in the region. In August 2019, Japan’s Foreign Minister, Taro Kono, paid a pivotal visit to the Pacific—Fiji, Palau, Micronesia, and the Marshall Islands—to bolster Tokyo’s ties with the PICs. The tour to Fiji was the first official visit by a Japanese foreign minister in 32 years. His visits to the other three PICs were the first ever by an incumbent Japanese foreign minister. Moreover, his visit came at a time when both Palau and the Marshall Islands were under severe pressure from Beijing to sever their diplomatic ties with Taiwan (Nikkei Asian Review, 2019). Other important areas include the landlocked Central Asia and Afghanistan in which Tokyo needs to pay closer attention to facilitate regional stability and peace building including counterterrorism, as reflected in the 2017 development cooperation document (MOFA of Japan, 2017a). Japan’s growing acknowledgement of Central Asia, which is expected to provide Japan with a reliable alternative source of energy such as oil, natural gas and rare earth metals including uranium, was highlighted even before the initiation of Tokyo’s FOIP when Abe became the first Japanese leader to visit all five Central Asian countries in October 2015 (Sano, 2018a). Meanwhile, Afghanistan, which lies at the center of the Central Asia Regional Economic Cooperation Program linking markets in 11 countries with six corridors, has become a vital economic hub connecting Central and South Asia in trade, transport and energy despite ensuring peace and stability in the country continues to be a challenge for the international community including Japan. Since 2002, Tokyo has actively taken a comprehensive approach with an aim to support Kabul’s self-reliance, prevent the country from becoming a hotbed of terrorism as well as to play significant roles in security-sector reform programs (MOFA of Japan, 2015b). Closely related, Iran’s Chabahar port and Afghanistan’s Zaranj-Delaram Highway, have become essential footholds in providing Tokyo valuable access to the energy-rich Turkmenistan,

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Uzbekistan and Kazakhstan bypassing unstable routes in Pakistan. The importance of Chabahar port has increased significantly especially with the development of the China–Pakistan Economic Corridor (CPEC) which is heavily dependent upon Pakistan’s Gwadar port, located only a short distance away from Chabahar. While the deepening of linkage between security and development has become a necessity for Japan in providing opportunities as well as in coping with the challenges in the Indo-Pacific region, this has put Tokyo in a geostrategic dilemma in determining its long-term strategy.

Risks Associated with Japan’s Ongoing Efforts in Pursuing Its FOIP In determining its long-term strategy, one question arises for Tokyo: whether or not to strengthen the security elements of its FOIP and make it a more security-oriented initiative similar to the one adopted by Washington. By transforming its FOIP into a more security-driven initiative, Tokyo would be able to cope more actively with China’s assertiveness given the growing strategic competition between the U.S. and China in the Indo-Pacific region. In doing so, however, Tokyo will encounter a variety of risks. First, it is highly likely that Tokyo will undermine the legitimacy in pursuing its FOIP by losing support from key regional countries notably the ASEAN member states which have feared being forced to take sides with either of the regional major powers, namely the U.S. and China. Since the end of the Cold War, the ASEAN has become the core of regional multilateralism in the Indo-Pacific with the establishment of multiple regional organizations such as the East Asia Summit (EAS), the ASEAN Regional Forum (ARF), ASEAN Plus Three, the ASEAN Defense Ministers Meeting-Plus (ADMM-Plus), the Expanded ASEAN Maritime Forum (EAMF) and other relevant ASEAN Plus One mechanisms. Moreover, Southeast Asia has become a critical factor for Japan’s foreign and security policies as the region is located not only along the vital sea lanes of communication in the South China Sea and eastern part of the Indian Ocean but also as the geographical center of Japan’s FOIP vision. Surprisingly, the importance of ASEAN was not illustrated explicitly in the official documents in the early stages of Tokyo’s FOIP. But, by December 2018, the significance of the ASEAN was reaffirmed in an official document, which placed the ASEAN at the center of the Indo-Pacific region and emphasized the importance of ASEAN’s centrality and unity in Tokyo’s initiative (MOFA of Japan, 2018a). Today, Japan recognizes the significance of ASEAN’s development in political, security, economic, social and cultural fields as a whole. However, many ASEAN member states have thus far not necessarily clarified their explicit political support for Japan’s FOIP. This is primarily due to the fear within the ASEAN countries of both offending China and undermining ASEAN centrality. This has led the ASEAN

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member states to formulate its own consensual initiative, ASEAN Outlook on the IndoPacific, in June 2019, which stresses the importance of inclusiveness and envisages an Indo-Pacific region as one with “dialogue and cooperation instead of rivalry”. The ASEAN document also emphasizes the significance of “development and prosperity for all” placing ASEAN centrality as the underlying principle for promoting cooperation in the Indo-Pacific (ASEAN, 2019). Simply put, support from the ASEAN countries would be essential to securing legitimacy in Japan’s FOIP. Transforming the FOIP into a security-oriented initiative would most likely force the ASEAN countries to distance themselves from Tokyo’s FOIP or even worse to reject openly to the initiative altogether. Second, transforming its FOIP into a more security-driven initiative would minimize the likelihood for Tokyo to establish a more cooperative relationship with China which has continuously acted repulsively of being targeted politically and militarily namely by the U.S. and its allies and partners. Indeed, apprehensions over China’s BRI notably due to its geostrategic implications as well as Beijing’s de facto possession of overseas ports, such as Sri Lanka’s Hambantota harbor and Pakistan’s Gwadar port, have driven countries including Japan to question the intent of Beijing in pursuing its BRI. In addition, Japan has strengthened its defense efforts amid growing concerns over Beijing’s military buildup and its continuous assertive actions in the East and South China Seas as well as in the Indian and the Pacific Oceans. According to the 2019 report to the U.S. Congress, Chinese state-owned companies either owned equity in or had an operating lease at approximately 70 ports outside of China, which could be converted into dual-use military functions or become “strategic strongpoints”. The report also noted that China’s 2013 Science of Military Strategy pointed out that the strategic strongpoints would enable the PLA to move in the direction of the Pacific and the Indian oceans, function as forward operating bases or otherwise support military operations, and exert influence in the surrounding region. Furthermore, the report quoted a comment by a researcher at the U.S. Naval War College, which he noted that China has been currently prioritizing the Indian Ocean—which links Djibouti and the South China Sea—to further develop strategic strongpoints for its oil imports and other seaborne trade, and, at the same time, considering to establish strategic strongpoints in the Pacific Ocean by expanding security cooperation with the PICs as well as by establishing military presence in such countries as Vanuatu (U.S.-China Economic and Security Review Commission [USCC], 2019). Meanwhile, some observers have speculated that the core of Tokyo’s FOIP rested with the Quad given Abe’s preference for a quadrilateral security cooperation among Japan, the U.S., Australia and India with his “Democratic Security Diamond” concept declared in 2012 as noted above. Indeed, the four countries resumed the Quad consultations in November 2017 after a 10-year interruption. During the ministerial-level meeting held in November 2019, the Quad countries explored measures to “enhance coordination on quality infrastructure based upon international standards such as the G20 Principles for Quality Infrastructure Investment” as well as to strengthen partnerships with existing regional framework (U.S. Department of State [DOS], 2019a).

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Yet, Japan has intentionally avoided taking actions that would be perceived by China as containment through its FOIP. Today, Tokyo has maintained its desire, although with discretion and prudence, to provide cooperation and financial support for China’s BRI, under certain conditions, since reversing its original position on the BRI in June 2017 (Japan Times, 2017a). In return, Beijing welcomed Tokyo’s change of course, advocating that participation in the BRI could be a “testing field for China and Japan to achieve mutually beneficial cooperation and common development” (Japan Times, 2017b). If initiated and politically sustainable, there would be some promising opportunities for Japan as China remains not only an important trade partner, but also a country with which Tokyo could, from a broad, as well as a medium- to long-term perspective, build a “Mutually Beneficial Relationship Based on Common Strategic Interests” (GOJ, 2013). In addition, Tokyo may be able to pursue some important national economic goals through greater overseas infrastructure investment along the BRI route (Sano, 2018b). Cooperation with the BRI may also enable Japan to strengthen its ongoing efforts in promoting regional connectivity and integration by complementing the BRI. Furthermore, cooperation between Tokyo and Beijing could deliver more rapid and sustainable growth, especially in light of the region’s high demand for infrastructure. In Asia alone, the demand for infrastructure is projected at USD 26 trillion over the period from 2016 to 2030, or USD 1.7 trillion per year, more than doubling from that of USD 750 billion estimated in 2009 (Asian Development Bank [ADB], 2017a: 5). It has been reported that the level of today’s infrastructure demand is higher than the capacities which the World Bank, the Asia Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB) are capable of covering (Nikkei Asian Review, 2017). It will, therefore, be in the interest of Japan to cooperate, under certain conditions, with China’s BRI in strengthening regional economic connectivity in the Indo-Pacific. Third, a security-driven initiative, if implemented, will force Japan to be entangled in the U.S. hardliner stance towards China. Up to now, Tokyo and Washington have endeavored to adopt a comprehensive strategy under the Japan–U.S. Alliance in coping with the various challenges facing the Indo-Pacific region. Furthermore, both countries agree highly on the importance of maintaining fundamental principles such as the rule of law and freedom of navigation. As a result, Tokyo has been deepening cooperation with Washington in strengthening regional connectivity. In November 2017, Abe and Trump affirmed that they would collaborate in promoting peace and prosperity in the region by developing the FOIP, and cooperate with countries that share the FOIP vision (MOFA of Japan, 2017b). In addition, the two countries affirmed in November 2018 the importance of developing the FOIP through energy, infrastructure and digital connectivity cooperation (MOFA of Japan, 2018b). Furthermore, there have been multiple efforts in strengthening cooperation in the private sector as well by, for example, the announcement of a Blue Dot Network (BDN) in November 2019 which Japan, the U.S. and Australia would provide certification for sustainable, high-quality, private sector-led infrastructure projects (GOJ, 2019). However, Washington, unlike Tokyo, has taken a more confrontational approach in utilizing its own version of FOIP strategy/vision. In early June 2019, the U.S.

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Department of Defense (DOD) released an exclusively security-oriented document, the Indo-Pacific Strategy Report, which specifically criticized China, along with Russia and North Korea, that Beijing “undermines the international system from within by exploiting its benefits while simultaneously eroding values and principles of the rules-based order” (U.S. Department of Defense [DOD], 2019). In addition, the U.S. Department of State released its Indo-Pacific initiative in November 2019, emphasizing the importance of a “shared vision” rather than that of inclusivity (U.S. DOS, 2019b), suggesting that the initiative is primarily in harmony with the basic confrontational approach of the Trump administration as highlighted in the 2017 National Security Strategy (NSS) and the 2018 National Defense Strategy (NDS). With little room to maneuver outside of the Japan–U.S. Alliance framework, Tokyo will most likely be pressured to align with Washington’s confrontational FOIP if the U.S. decides to maintain or even escalate the level of confrontation against China. Transformation to a security-driven initiative, however, could negatively affect the level of support towards Japan’s FOIP vision as a whole. Such a transformation could also complicate Southeast Asian states’ relations with Japan, the U.S. and China.

Overcoming the Geostrategic Dilemma The Indo-Pacific is a geo-strategically diverse region that comprises a wide variety of actors which include democratic and authoritarian regimes, developed and developing countries, continental and maritime powers as well as a broad range of alignments (Szechenyi & Hosoya, 2019). Moreover, the international community, including the Indo-Pacific, is now at a crossroads in confronting with multiple contradictions: multilateralism versus unilateralism, open-world economic system versus protectionism and public good versus nation first. Furthermore, the strategic competition between the U.S. and China has intensified in the Indo-Pacific and has become even more evident with the outbreak of the COVID-19 pandemic. With the shift in the global power balance coupled with the increasing complexity and uncertainty of the international environment, there may even be a realignment in the international order in a not-so-distant future. Given these circumstances, it would be imperative that Japan maintains its long-sustained alliance with the U.S., and that it expands the range of options in its pursuit of a free and open economic development and of an international rules-based order. Specifically, Tokyo needs to.

Take on Additional Security Roles as an Indispensable Ally of the U.S. For more than 60 years, Tokyo has made its own strenuous efforts in securing peace and prosperity of Japan, and for that reason has continuously strengthened its alliance

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with the U.S. Indeed, the Japan–U.S. Alliance has functioned as the cornerstone of Japan’s security. It has also served as a foundation for the U.S. strategy in the IndoPacific. Furthermore, the alliance has played a prominent role for peace, stability and prosperity in the Indo-Pacific as well as the international community as a whole. However, many government officials and academics, notably in the U.S., have questioned the lopsided feature of the alliance in which Japan has been disproportionately dependent on the U.S. for many decades. In that sense, Tokyo’s decision to revise the Constitutional interpretation of the collective self-defense in July 2014 was an epochmaking event. With the revision, Japan is now able to exercise the right to collective self-defense under three conditions: first, when an armed attack against a foreign country that is in a close relationship with Japan occurs and as a result threatens Japan’s survival and poses a clear danger to fundamentally overturn people’s right to life, liberty and pursuit of happiness; second, when there is no other appropriate means available to repel the attack and ensure Japan’s survival and protects its people; and third, the use of force should be limited to the minimum extent necessary (GOJ, 2016). The revision of the Constitutional interpretation of the collective self-defense enables Japan’s SDF to assist its ally, the U.S., as well as partners that are under attack, even if Japan itself is not. Given the growing U.S.–China strategic rivalry, the U.S. presence is essential in maintaining peace and stability in the Indo-Pacific. In this sense, the Trump administration’s decision to shift its strategic priorities to the Indo-Pacific region, as highlighted in the 2017 NSS and the 2018 NDS, has been encouraging for Tokyo as well as for the like-minded countries in the region. Yet, President Trump’s “America First” policy has heightened concerns among the U.S. allies and partners and has, in part, raised doubts about the reliability of their relationship with Washington. Moreover, the U.S. has been pressuring its allies and partners to take on more financial responsibilities which have caused frictions in their relationships as highlighted by the recent decline of relationships between Washington and Berlin due to differences in their views over the level of defense spending. It has been reported in September 2020 that Washington has urged its allies including Tokyo to increase military spending to at least 2% of their GDP to counter China (Fang, 2020). In the case of Japan, Tokyo has approved USD 50.5 billion (JPY5.51 trillion) for its defense spending for FY 2020, a record high, but accounts for only 0.9% of its GDP. In fact, there seems to be no consensus since 2004 between Tokyo and Washington as to what percentage of the financial burden needs to be borne by Japan (Mie, 2017). According to the latest report released by the U.S. DOD in 2004, Japan provided direct support of over USD 3.2 billion and indirect support worth over USD 1.18 billion in 2002, offsetting as much as 74.5% of the total cost of U.S. stationing in Japan (U.S. DOD, 2004: B-21). This is the largest percentage among the U.S. allies and partners. However, further discrepancies over the level of defense spending or an increasing frictions between Washington and its allies and partners would likely result in an unstable situation, if not a power vacuum, that would be exploited by countries such as China and Russia. The most realistic way, therefore, to compensate for the differences over defense spending would be for Japan to take on more security roles as an indispensable ally of the U.S. and share more of the burden for its collective

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self-defense in the Indo-Pacific. Increasing the presence of the SDF in the Indian Ocean, for example, as well as in the South China Sea and the Southern Pacific, would strengthen the protection of the sea lanes of communication. Given the lack of power projection capabilities of the SDF, the use of the U.S. base in Diego Garcia as well as India’s ANIs, for example, would serve as important hubs for Japan. At the same time, Japan should ensure consistency with its current economic/development and security policies involving the U.S. as well as its strategic partners. In doing so, Japan should continue focusing on quality and affordability in the various Japanese infrastructure projects. These areas have a strong competitive advantage over China. While China has been upgrading the quality of its manufacturing sector with the Made in China 2025 strategy, it still lags behind in quality in infrastructure projects. The signing of MOUs by the U.S. Overseas Private Investment Cooperation (OPIC) and its Japanese counterparts, Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance (NEXI) in November 2017, as well as the initiation of the Japan-U.S. Strategic Energy Partnership, in the same month, for example, are intended to offer high-quality Japan-U.S. infrastructure investment alternatives in the Indo-Pacific region.

Develop a Legitimate, Inclusive and Non-Security-Oriented Initiative It is imperative that Tokyo maintains the non-security-oriented nature of the FOIP. A transformation to a confrontational initiative that targets or contains certain countries such as China would most likely negatively affect the level of support from countries such as the ASEAN member states towards Tokyo’s FOIP, leading to the loss of legitimacy in the initiative altogether. As noted, many ASEAN member states have thus far not necessarily explicitly clarified their political support for Japan’s FOIP, primarily due to fear of both offending China and undermining ASEAN centrality. Given the importance of the ASEAN centrality in Tokyo’s FOIP, support from the ASEAN countries would be essential in securing legitimacy in Japan’s FOIP. In order for its FOIP to remain as a non-security-oriented initiative, Tokyo needs to ensure that the initiative remains inclusive, enabling countries, upon their consent, to incorporate the framework. First and foremost, ASEAN centrality needs to remain at the core of Japan’s FOIP vision. As highlighted in the 2020 document, Achieving the “Free and Open Indo-Pacific (FOIP)” Vision, Tokyo has been expanding its security cooperation with countries besides the ASEAN in line with the FOIP. However, the significance of the ASEAN remains intact serving as an important geopolitical hub by linking the two regions and oceans. Furthermore, the ASEAN leaders have expressed concerns towards such mechanisms as the Quad that these frameworks may very well supplant rather than supplement the ASEAN’s role in the region. It is imperative, therefore, that Tokyo develops its FOIP vision without endangering the principle of ASEAN centrality. At the same time, Japan needs to seek a free and

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open environment that would provide the Indo-Pacific states including the ASEAN countries with more strategic space to manage their relations with the major powers rather than to leave these countries with no option but to take sides. Equally important, Tokyo would need to cooperate better with Beijing. To begin with, it is critically important that Beijing does not perceive itself as being contained by Tokyo’s FOIP or by any other mechanisms. Seeking to contain China would leave Beijing few options other than trying to challenge the regional status quo by force or coercion. Second, Japan needs to engage itself in Beijing’s initiative so that China’s infrastructure projects would be conducted based upon international standards and rules. Issues such as irresponsible financial practices as well as the lack of transparency have been pointed out as part of BRI’s major shortcomings. Excessive investment in infrastructure has also raised concerns as recipient countries face the danger of losing not only ownership of the projects but also its sovereignty and territorial integrity over time (Kliman et. al., 2019). Given these setbacks, Japan’s participation in the AIIB could, for example, ensure that the BRI becomes a more accommodating initiative for all based on international rules and standards. It has been pointed out earlier that Tokyo may be able to lower China’s share of voting rights which currently accounts for more than 25% (Nikkei Asian Review, 2017), and push the AIIB’s development in the right direction with an estimated 11% capital share and 9% voting share (Lu, 2016). Third, Tokyo needs to utilize other existing international institutions, such as the World Bank and the ADB. Importantly, there have been signs that the BRI would function to complement, rather than compete with, the roles of the World Bank and the ADB. The signing of a co-financing agreement and a memorandum of understanding between the Bank and the AIIB, and the co-financing agreement between the ADB and the AIIB reflect the trend towards increased coordination and joint financing by multilateral development banks to meet the infrastructure development demands in the developing countries (ADB, 2017b). Fourth, Tokyo’s FOIP would need to function, wherever possible, so that it would complement with other region-wide initiatives rather than supplanting them. Tokyo and Beijing could cooperate on overlapping functional areas such as energy conservation, advancement of industry and the distribution of goods, and as a result, could enhance the efficiency of both Tokyo and Beijing’s ongoing infrastructure projects. Furthermore, the U.S., India, the ASEAN countries and the Republic of Korea (ROK) have all devised their own initiatives. But the initiatives are not identical, and have differences in the geographic scope as well as their focus. What would be important for Tokyo is to highlight the common grounds and the differences so that the countries would be able to overcome the misunderstandings and misperceptions that have hindered them to unite in their pursuit of developing a more peaceful and stable Indo-Pacific region. In addition, Tokyo needs to facilitate its ongoing infrastructure development initiatives so that they would provide recipient countries with alternatives. Given the geopolitical implications of the BRI, Japan needs to encourage these countries to

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diversify their economic relations, and decrease their dependency on one particular country so that they would be able to receive infrastructure development assistance without being exploited (Borroz, 2017). Such examples include the Asia-Africa Growth Corridor (AAGC), the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), the International North—South Transport Corridor (INSTC) and the development of Chabahar Port in Iran. Stronger linkages among these projects are likely to strengthen connectivity in the Indo-Pacific region as a whole as well. In the meantime, Tokyo should not override or undermine existing organizations which would lead to further misunderstandings and misperceptions towards its FOIP. Furthermore, Japan needs to ensure that the security elements of its FOIP function in a way so that they would protect and sustain the various development efforts. Put differently, security elements of the FOIP should not be used to achieve geostrategic objectives such as the expansion of military presence in the region. The abovementioned measures, however, do not indicate, by any means, that Tokyo should overlook, condone or appease an action or behavior that would lead to making political or material concessions to an aggressive power. Instead, Japan should design a strategy that would deny and offset gains which countries, such as China, could derive from enhancing unilateral changes to the status quo. The most important issue for Japan would be to do so outside the framework of Tokyo’s FOIP as it is highly likely that implementing such an approach within the FOIP would negatively affect the level of support towards Japan’s initiative. Furthermore, establishing broader and deeper ties with non-regional powers such as the European Union (EU) would be critical as today’s security challenges are more directly related to cross-regional and global issues such as the prevention of the spread of international terrorism and WMDs, as well as maritime security, the outer space and the arctic.

Seek an Influential Role as a “Middle” Power As many scholars have noted, countries have become more and more anxious about the well-known Thucydides Trap: the intensification of a strategic rivalry stemming from fear and suspicion. Countries have also worried about the less-known Kindleberger Trap, which sees China as too weak instead of too strong thereby allowing Beijing to free-ride rather than contribute to an international order that it did not create (Nye, 2017). Even worse, some have worried that China is trying to establish its own international order by increasing its own national interests regardless of the possibility of endangering a peaceful and stable international environment. It is against this background that the economic and geopolitical intents of the BRI as well as its assertive military actions have been questioned. As a result, Japan would need to commit itself to become an influential “middle” power that can impact, if not ameliorate, the relationship between Washington and Beijing. This would require Japan to walk a fine line in mitigating the differences between the U.S. and China. At the same time, Tokyo would, as an influential “middle” power, need to (1) follow the

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existing rules and make them stronger, (2) lead efforts to make new rules to meet the needs of the times and (3) enhance free and fair economic development by expanding the range of options (MOFA of Japan, 2019). Yet, Trump’s rejections to participate in the East Asia Summit (EAS) and Asia– Pacific Economic Cooperation (APEC) Forum in November 2018 in line with his “America First” policy have raised doubts about the U.S. commitment to regional institutions as a platform for shaping diplomatic engagement on the rules and norms. In addition, the U.S. has begun to violate the international rules and norms which it established. Trump’s decision to withdrawal from the Trans-Pacific Partnership (TPP) Agreement has, for example, undermined the importance of open and free trade. Similarly, the U.S. departure from the Paris Agreement has impaired the ambitious and universal efforts in combating climate change. Furthermore, the reverse of the U.S. position over the Israeli–Palestinian conflict in favour of Israel as well as Trump’s decision to transfer the U.S. embassy to Jerusalem from Tel Aviv have weakened, in part, the foundation to solve, if not ameliorate, the regional confrontation through dialogues. These moves have impaired the democratic international order which the U.S. has so eagerly sought to spread and solidify. These setbacks have enabled countries such as China to enhance their influence in the Indo-Pacific. Given its tremendous economic, military and technological strength, however, it seems likely that the U.S. will, despite its decline in its relative advantages over China in recent years, remain as the most geopolitically influential leader in the foreseeable future in sustaining the fundamental principles of the international order, which are the foundation of peace and stability in the Indo-Pacific. Japan, along with other allies and partners of the U.S., therefore, needs to deepen its strategic ties with the U.S. and ensure that the U.S. remains committed to the Indo-Pacific region. Meanwhile, Japan, unlike countries such as India, does not have the political and military flexibility to maneuver outside of the framework of the Japan–U.S. Alliance. This raises a critical question for Japan: that is, how much freedom does Japan have to alienate itself from the U.S. at a time when Washington continues to maintain its confrontational security-oriented initiative? The honest answer would be: Not much. But this does not mean that Tokyo should voluntarily transform its FOIP into a more security-oriented initiative that would target countries such as China. Nor does it mean that Tokyo needs to be less dependent on its alliance with the U.S. If Washington decides to continue or even escalate its confrontational approach towards China, it would be important for Tokyo to focus on strengthening the regional connectivity for the sake of developing a peaceful and stable Indo-Pacific with its FOIP vision rather than to challenge/contain a specific country. At the same time, Japan would need to further deepen its security ties with the U.S. by taking on broader security roles, as noted above. This has to be done, however, under the Japan–U.S. Alliance, not within the framework of the FOIP. Admittedly, this may not be an easy task for Tokyo, especially at a time when the Trump administration intends to impose more physical and financial burden to its allies and partners in the security realm. However, maintaining its non-security-oriented FOIP would be the only way for Tokyo to exert its responsibilities as an influential “middle” power in promoting peace and stability in the region.

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Conclusion Today, Japan benefits significantly from actively engaging in the dynamic IndoPacific region. As a result, Tokyo has thrived to strengthen regional connectivity with its inclusive development-driven FOIP vision. At the same time, Japan has cooperated with the like-minded countries such as the U.S., Australia, India and the ASEAN countries in maintaining a secured regional order that is based on fundamental principles such as rule of law, freedom of navigation, openness and free trade. Furthermore, Tokyo has reaffirmed the importance of ASEAN and incorporated ASEAN centrality and unity into its FOIP while deepening the linkage between security and development to ensure peace and stability in the Indo-Pacific. It has also rephrased the FOIP from a “strategy” to a “vision”. These measures have prevented countries from perceiving Japan’s FOIP as an exclusive initiative that would force countries to take sides or to contain a particular country, notably China. But it has become increasingly clear that Tokyo now stands at a critical juncture in shaping its long-term strategy as Washington has taken a more competitive position against Beijing by intensifying technological competition as well as engaging in an all-out trade war. In overcoming the geostrategic dilemma, Tokyo would need to avoid forcing itself to take either a more competitive strategy against China in tandem with the U.S. or employ a more accommodating approach towards China that may raise doubt within the U.S. about maintaining a firm strategic relationship with Tokyo. From a Japanese perspective, it is imperative that Tokyo must take on additional security roles within the framework of the Japan–U.S. Alliance and, at the same time, maintain its inclusive non-securityoriented FOIP and fulfil its responsibility as an influential “middle” power. Only by doing so would enable Japan garner sufficient political support for its FOIP.

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Ministry of Foreign Affairs of Japan (MOFA of Japan). (2020, May). Japan’s effort for a free and open Indo-Pacific. Tokyo, Japan: Author. Nikkei Asian Review. (2017, June 22). It is time for Japan and the US to join the AIIB. Editorial. https://asia.nikkei.com/Business/Finance/Editorial-It-is-time-for-Japan-and-the-US-to-jointhe-AIIB Nikkei Asian Review. (2019, March 12). Taiwan president to visit Palau, Nauru and Marshall Islands. https://asia.nikkei.com/Politics/International-relations/Taiwan-president-to-visit-PalauNauru-and-Marshall-Islands Nippon.com. (2013, August 8). Behind the new abe diplomacy: An Interview with Cabinet Advisor Yachi Sh¯otar¯o (Part One). https://www.nippon.com/en/currents/d00089/ Nye, J. S. (2017, January 9). The kindleberger trap: Belfer center for science and international affairs: Harvard kennedy school. https://www.belfercenter.org/publication/kindleberger-trap Sano, S. (2017). Japan-India security cooperation: Building a solid foundation amid uncertainty: Strategic Japan working papers: Center for Strategic & International Studies. file:///C:/Users/user/Downloads/170511_Japan_India_3%20(1).pdf Sano, S. (2018a, May 16). India’s role is key for including central Asia in Japan’s free and open Indo-Pacific strategy. Asia Pacific Bulletin, Number 424. https://www.eastwestcenter.org/system/ tdf/private/apb424.pdf?file=1&type=node&id=36665 Sano, S. (2018b, February 23). Japan’s engagement in China’s belt and road initiative. Australian Outlook. http://www.internationalaffairs.org.au/australianoutlook/japan-one-belt-one-road/ Szechenyi, N. & Hosoya, Y. (2019, October 10). Working toward a free and open Indo-Pacific. Carnegie Endowment for International Peace.https://carnegieendowment.org/2019/10/10/wor king-toward-free-and-open-indo-pacific-pub-80023 U.S.-China Economic and Security Review Commission (USCC). (2019, November). 2019 report to congress of the U.S. China economic and security review commission: One hundred sixteenth congress, first session. Washington D.C., U.S.: Author. U.S. Department of Defense (DOD). (2004). 2004 statistical compendium on allied contributions to the common defense. Washington D.C., U.S.: Author. U.S. Department of Defense (DOD). (2019, June 1). Indo-Pacific strategy report: Preparedness, partnerships, and promoting a networked vision. Washington D.C., U.S.: Author. U.S. Department of State (DOS). (2019a, November 4). U.S.-Australia-India-Japan consultations (“The Quad”). Washington D.C., U.S.: Author. U.S. Department of State (DOS). (2019b, November 4). A free and open Indo-Pacific: Advancing a shared vision. Washington D.C., U.S.: Author.

Dr. Shutaro Sano is Professor at Nihon University College of International Relations, former Professor at the National Defense Academy of Japan (NDA), and Colonel, Ground Self-Defense Force (retired). Dr. Sano specializes in international security notably in the Indo-Pacific region. His recent academic works include “Trust and Trust-Building in Northeast Asia: The Need for Empathy for Japan-ROK-China Security Cooperation - Japanese Security Perspective” (coauthored) in Kevin Clements (ed.), Identity, Trust, and Reconciliation in East Asia: Dealing with Painful History to Create a Peaceful Present (Palgrave Macmillan, 2018); “Japan-India Security Cooperation: Building a Solid Foundation amid Uncertainty,” CSIS Japan Strategic Working Papers (2017); “Japan-India Bilateral Security Cooperation: In Pursuit of a Sound and Pragmatic Partnership” (coauthored) in Rohan Mukherjee and Anthony Yazaki (eds.), Poised for Partnership: Deepening India-Japan Relations in the Asian Century (Oxford University Press, 2016). He is the winner of the Inoki Masamichi Honorable Award (Japan Society for Defense Studies) for his publication on private military and security companies in 2015. He graduated from NDA in 1989, received his MA in public policy from John F. Kennedy School of Government, Harvard University (1995), and Ph.D. in international security from NDA (2013).

Chapter 3

China’s Geopolitical, Geoeconomic and Geostrategic Gameplay in the Indian Ocean Region Nitin Agarwala and Rana Divyank Chaudhary

Abstract The Indian Ocean has been at the centre of interest for nations for many years. This interest led to the colonization of the South Asian subcontinent. The colonization of this region ended nearly a decade ago but the interest of various world powers continues to dominate the gameplay that can be seen in this region. The latest in the fray is China, which believes that the Indian Ocean is not the backyard of India and that Beijing has an equal right to this region, a thinking that stems from the fifteenth century, when the Ming imperial court’s Admiral Zheng He frequented this region. Such thinking has brought China into the Indian Ocean through economic investments, political influence and military presence and these are now significantly altering the regional dynamics of this region. As China protects its economic investments, it can be seen employing various geopolitical, geoeconomic and geostrategic game-plays in the Indian Ocean Region. This chapter thus aims to discuss such gameplays while paying special attention to the 2019 Defence White Paper which indicates China’s interests in securing trade routes and access to natural resources beyond the South China Sea.

Introduction The Indian Ocean which is the third-largest ocean in the world is unique as it provides an extensive network of shipping lanes to carry vital cargo between countries across its vast expanse. Any control of the access points (or entry points) of this region allows control over these international shipping lanes and by extension the world trade moving on these waters. These sea lanes provide access for the world market to nearly 60% of the world population that resides in the Asian countries and make the Indian Ocean hugely important to global trade. Historically, this region has seen sea N. Agarwala (B) Research Fellow at the National Maritime Foundation, New Delhi, India R. D. Chaudhary University of Delhi and a Ph.D. Candidate At Department of East Asian Studies, Research Fellow in Defence and Strategic Studies, University of Delhi, Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_3

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trade since time immemorial by traders of countries both regional and extra-regional. Today, one of the major trading nations in these waters is China. In the yesteryears, China was active as a trading nation here till the fifteenth century under the last and the most famous of its great seafarers, the Ming imperial court’s Admiral Zheng He. Subsequently, after the Ming emperor’s decision to focus primarily on the land-based threats to the empire and a prohibition on maritime activities, Chinese movement over the oceans became negligible (Holmes & Yoshihara, 2008). The triumph of the Communist Revolution in 1949 and the emergence of ‘New China’ as an economic giant increased its presence and involvement in this region, however, to the disdain of the other players such as the US, India, Japan and Australia already active in this region. This involvement was primarily driven by China’s own economic interests that stem from the need to ensure the well-being and prosperity of its people. In doing so, China unveiled many ambitious geoeconomic plans, through economic investments, to build infrastructure and to improve transport connectivity, setting up port projects along vital Sea Lines of Communication (SLOCs),1 infusing Chinese workers and raw materials along with large amounts of money in foreign countries, while purchasing various multinational companies with cutting edge technology to name a few. With an increasing economic investment in foreign lands, and with an intention to ensure safety for its workers and investment, China is compelled to intervene in the domestic affairs of these nations resulting in the various geopolitical, geoeconomic and geostrategic game-plays devised by Beijing in the Indian Ocean Region, which according to some thinkers is upsetting the current balance of power in the Region that is now becoming a new normal here. This extra-regional involvement is forcing the People’s Liberation Army-Navy (PLAN) to see greater involvement beyond their shores in the form of joining navies of the world to protect international SLOCs as highlighted in the 2015 Defence White Paper. With increasing Chinese investments, land acquisitions and military projection in the Indian Ocean, the future of the region seems extremely uncertain and tumultuous. It is with this understanding and to answer some of the questions arising out of this context that the chapter aims to discuss the Chinese gameplay in the Indian Ocean. It pays special attention to the 2019 Defence White Paper that focuses on China’s interests in securing trade routes and access to natural resources beyond the South China Sea.

Understanding the Link Between Geoeconomics and Geopolitics In order to better appreciate the terms geopolitics, geoeconomics and geostrategy, it is essential to address them before we delve into their interaction and the resulting game plays that nations engage in.

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For a nation, its holistic-security is addressed as a layered approach. The outermost layer is that of geopolitics as is seen by the world. This geopolitics is based on the need to achieve certain geoeconomic goals, such as economic well-being of the population, and non-geoeconomic goals, such as a positive image in the world. Since the success of a nation is directly dependent on its ability to achieve these goals, the next layer is that of geostrategy that the nation needs to employ for the fulfilment of these desired goals. Finally, there is diplomacy and the military that are used as an assurance and insurance mechanisms to eventually protect these geostrategies. To elaborate this, hierarchical formulation let us consider the example of China. As a nation, the geopolitical goal of China is to become a superpower and to ensure the societal, material and economic well-being of its people. In order to achieve this, it has set some geoeconomic goals of which one of them is the import of raw materials for the development of its industries. To achieve this geoeconomic goal, one of the geostrategies it has employed is the Belt and Road Initiative (BRI). As an assurance mechanism for the success of this geoeconomic goal, it uses economic investments and diplomacy to bring countries under the fold of BRI and its military might through expansion, modernization and aggressive posturing/exercising/basing of the PLA forces as insurance for the BRI. While discussing these terms and their interactions, it is imperative to mention that many a time there is a major conceptual error in the understanding of some analysts about this hierarchy. Many a time geopolitics, geoeconomics and geostrategy are placed at the same hierarchical level whereas the correct conceptual hierarchy is as seen in Fig. 3.1. It is also imperative to mention that in recent years, the use of geoeconomics by nations has increased wherein carrying out geopolitical conflict through economic Fig. 3.1 The correct hierarchical formulation of geopolitics, geoeconomics and geostrategy (Source Lecture notes of the authors at NMF)

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means has become a norm. Policies governing everything from trade and investment to energy and exchange rates are wielded as tools to win diplomatic allies, punish adversaries and coerce those in between. This tool of geoeconomics is not new as it was practiced by the United States after the Second World War to mould Europe according to its own choice. Today, China displays this art of using geoeconomics at almost the same level of the US. One finds great similarity between the American Marshall Plan and China’s grandiose Belt and Road Initiative (Carter, 2018; Shen, 2016). Similarly, China’s Asian Infrastructure Investment Bank and the Bretton Woods Institutions seeded by the US are similar and together are shaping the geopolitical contest among nations through the use of geoeconomics. With “war” becoming a “no–no” to resolve issues under the present international law and global norms, geoeconomics has taken centre stage. It is vital to recognize that geoeconomic power can be both malign and benign and hence the geoeconomic blowback may cause a rethink about the value, basis and leadership of the international system. Furthermore, there will always be a strong political component in geoeconomics and a strong economic component in geopolitics. Some will argue that there is no real difference between geopolitics and geoeconomics, and that in the end politics is all about economics, since it all comes down to resources which can be translated into quantities, expressed in some monetary form. Though it is true, but we feel that if we consider this to be true, it will be too simplistic and incorrect as the interactions are more complicated than what meets the eye.

Background In a world wherein, Asia plays an increasingly important economic and geopolitical role, the Indian Ocean provides the foundation for the trading systems that underpin Asia’s economic rise. The Indian Ocean is the basin in which trade from Europe, Asia, West Asia (referred to as the Middle East in American literature), and Africa connects. It is the energy lifeline on which several of the world’s major economies such as those of China, Japan and India to name a few, depend upon. The extensive trade moving on these waters and the numerous maritime chokepoints on this trade route tend to determine the region’s future based on the ever-evolving geopolitical outcomes between the nations of this region. In recent times, with tremendous economic growth, dependence on energy imports for China has skyrocketed. These overwhelming amounts of energy imports traverse through the Indian Ocean and pass through several chokepoints like the Malacca straits. Beijing fears that any disruption by a rival maritime power can starve their economy. This thinking is substantiated by events such as an interception of a Chinese merchant ship by the US navy in the waters of the Persian Gulf in 1993. The vulnerability of sea-borne energy shipments thereby forced Beijing to look at developing its navy even though for many years it was assumed that the People’s Liberation Army

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(PLA) would follow a continental strategy in which the maritime strategy will only be a part of the continental defence. Such events eventually led to the Politburo of the Chinese Communist Party developing an ambition for China in 2012 to become a world power. This ambition then brought about a consensus within the Chinese leadership that becoming a world power necessarily requires becoming a maritime power that is capable of defending its interests in the far seas. Hence, a new maritime strategy was developed that required the creation of supporting infrastructure for the PLAN to operate in far-off areas. Eventually, China signalled its intent of becoming a maritime power to the world through its 2015 Defence White Paper.

The Geoeconomic Gameplay With the geopolitical (non-geoeconomic) goal of becoming a maritime power that could ensure protection of its SLOCs, the PLAN realized the need for offshore bases in the Indian Ocean. This strategy allowed the preparation of a plan to be implemented progressively. The plan included the need of: (a) (b) (c) (d) (e)

Obtaining an economic toehold in the Indian Ocean littoral by creating a perception of China as a benefactor to the host nation. Offering investments of capital to boost trade. Offering to build infrastructure and Special Economic Zones. Making regional states indebted to China. Convincing these states to provide a base for Chinese operations in the Indian Ocean.

In line with this plan, in October 2013, President Xi Jinping unveiled the Belt and Road Initiative (BRI) that aimed to build infrastructure and improve transport connectivity in more than 60 countries across Asia and beyond. The proposal made sense to the world community as both the ADB and HSBC estimate the need of USD 26 trillion and USD 11.5 trillion respectively for developing infrastructure in Asia. For the financially and infra-structurally weak countries in the region, this was a blessing in disguise that allowed the PRC to sign agreements with 137 countries across the world. Since then, China has managed to network multiple Asian and African coastal nations through a combination of hard military tactics, political patronage, massive investment spending, focused port development projects and collaborative naval equipment transfers that have helped further China’s military and commercial ambitions under the guise of economic development and to get the recipient nations out of the strategic orbit of other nations such as India. For the African nations, even though China’s diplomatic relations with the African countries dates back to the 1960s and the 1970s,2 it has seen intensive economic activity only in the last decade with most of the activities being commercial and military in nature rather than being non-military3 as is expected in foreign relations. Though it is difficult to list out the entire gambit of activities being undertaken by China in Asian and

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African nations of the Indian Ocean Region, Table 3.1, provides a brief idea of the major activities, both commercial and military in these countries thereby providing an overview of the geoeconomic activities in which China has been involved in the recent past to ensure that its geopolitical goals are achieved.

The Geostrategic Gameplay As discussed in the preceding paragraphs, China has been employing geoeconomics very effectively to ensure that the geopolitical goals are met. However, one must not forget that one of their main goals is to become a maritime power as brought out in the 2015 Defence White Paper. Since their first deployment, China has adroitly blended its shipping protection mission with traditional naval diplomacy by making certain that its warships routinely conduct goodwill visits and naval exercises with most of the Indian Ocean littoral countries. In order to support and protect its maritime trade, it is necessary for Beijing to actively engage in a “place and base”4 approach for permanent and assured Indian Ocean access for its navy. In doing so, they need to stop criticizing the overseas bases of other nations as a means of hegemonic behaviour since Beijing now realizes the value of these bases as support facilities along long maritime routes. Today, China justifies these logistics “outposts” in the western Indian Ocean as a means of contributing to regional security and development. In addition to the existing bases, China has reportedly approached governments in locations as diverse as Timor-Leste and Cambodia in the Indo-Pacific and the Azores islands (Portugal), and Walvis Bay (Namibia) in the South Atlantic. This suggests a strategy to develop a global footprint to ensure that their geopolitical goal of being a maritime power is achieved (Chengappa, 2019). Broadly, to implement their geopolitical gameplay, the geostrategies employed by China include: (a)

(b)

Tools of influence: Debt owed to Chinese financial institutions, the lure of future Chinese investment and cash gifts were leveraged to gain access and control to the infrastructure in the host nation. Targets of influence: National leaders, local officials and port authorities were influenced to ensure that there was a minimum resentment expressed by Joint Venture partners and International shipping alliances with regard to the Chinese partners’ activities of seeking control.

These geopolitical gameplays have the following implications for the nations of the region. (a) (b) (c)

Host nations are saddled with enormous Chinese debt, due to which they have leased out infrastructure so built to Chinese state-controlled entities. Host countries have either established free-trade agreements with China or are currently negotiating them. The dual use of the commercial ports for surveillance missions at a later date cannot be discounted.

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Table 3.1 Economic and strategic relationships of a select Indian Ocean countries with China Country

Nature of activity

Big Ticket Infrastructure projects under development by China

Chinese investment spending 2008–2017 ($ bn+)

Status of FTA with China

Bangladesh

Naval (46 vessels, Export of submarines) Financial assistance

Chittagong Port, Sonadia Port

24.1

Biggest trading partner, Feasibility study started in 2016

Maldives

Construction and Economic assistance

Thavanddhippolhu Integrated development (iHavan) project Marao Atoll or Gaadhoo Island in Laamu Atoll

NA

Signed (2017)

Myanmar

Naval (17 vessels) Construction and Economic assistance

Kyaukyu deep water port

7.4

ASEAN-China FTA (2010)

Pakistan

Naval (15 warships Gwadar deep water 50.6 and submarines) port, Port of Karachi

Signed (2007) Has a 40-year lease to operate this port. A Chinese state-owned company with military links is in charge of the project

Sri Lanka

Naval (17 vessels) Construction and Economic assistance

Hambantota Port, Port of Colombo

Biggest trading partner, Negotiations started in 2014

Ethiopia and Djibouti

Economic investment

Railway Line connecting Djibouti and Addis Ababa

Djibouti

Economic investment

14 major infrastructure projects including Doraleh Port

Tanzania

Construction/ Infrastructure and Economic assistance

Bagamoyo Mega port and Special economic zone, Port of Dar-es-Salaam

14.7

(continued)

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Table 3.1 (continued) Country

Nature of activity

Big Ticket Infrastructure projects under development by China

Kenya

Construction and Economic assistance

Railway Line

Ghana

Construction/ Financial and Economic assistance

Fishing Port

Cameroon

Construction and Economic assistance

Construction of deep water port

UAE

Construction assistance

Khalifa Port

Egypt

Construction and Economic assistance

Port Said

Coco Islands

Construction and Economic assistance

Military facility

Malaysia

Construction and Economic assistance

Kuantan Port, Port Klang, Kuala Linggi International Port

Australia

Construction assistance

Port Darwin

Indonesia

Construction assistance

Port of TanjungPriok

Oman

Construction assistance

Port of Duqm

Chinese investment spending 2008–2017 ($ bn+)

Status of FTA with China

Source Authors from various sources

(d) (e) (f)

Making host countries such as Djibouti, Pakistan, Maldives, Laos, Sri Lanka financially vulnerable. Higher involvement of Beijing, willingly or unwillingly, in the domestic affairs of host nations. New lease of life to undemocratic, weak and corrupt governments where such investments have been made.

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The Geopolitical Gameplay The original driver of the Belt and Road Initiative (BRI) was trade and commerce to sustain the economic growth of China through increased international trade, domestic development and management of internal security concerns in Xinjiang and Tibet. With time, the military driver was put in place to prophesize safety of China’s economic interest and its belief that the Indian Ocean is part of the erstwhile Maritime Silk Route that extended from coastal China, through Southeast Asia, into the Indian Ocean, and all the way to the Saudi peninsula and African littoral. This broad geographic vision has allowed China to pursue an integrated set of trade, commercial, diplomatic and military initiatives from the South China Sea to the African littoral (Green, 2018). The necessity of creating this geopolitical gameplay was driven by the need that has five drivers. These include (Becker et al, 2019): (a) (b)

(c)

(d)

(e)

Recognition of the region’s global strategic importance: China has realized the importance of the Indian Ocean as a vital link to connect Asia with the world. Access to important maritime chokepoints: The fear that the heavy reliance on seaborne energy imports and maritime trade could be intercepted by maritime rivals at chokepoints located in the region has forced China to develop its PLAN. Supporting domestic economic growth: China’s current economic growth is concentrated east of the 15-inch isohyet and the regions of Xinjiang and Tibet that are west of this isohyet and in the interior of China are economically weak. Creating a trading route through these regions would provide support to the domestic growth and an alternative to the Malacca dilemma. Defending Chinese people and assets abroad: The involvement of China in projects and trade abroad has increased the number of Chinese nationals and investments that need to be protected. This has forced the development of the PLA-Navy to protect these interests. Combating domestic terrorism: By engaging with countries in the region and signing bilateral agreements for security and combating terrorism, China is denying domestic separatist groups access to foreign support.

Military Involvement As discussed earlier, the geopolitical goal of China is to ensure the well-being and prosperity of its people for which it needs to use geoeconomic strategy plans such as economic investments, building infrastructure, land acquisition, infusing Chinese workers and raw material to name a few. In order to ensure that these geoeconomic interests are achieved, China has used geostrategic gameplays that include primarily increasing its military presence in the Indian Ocean Region as has been discussed in the 2015 Defence White Paper and then amplified in the 2019 Defence White Paper. Let us see the key features of the two defence white papers.

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(a)

N. Agarwala and R. D. Chaudhary

The 2015 Defence White Paper gave political clearance to the following geostrategic goals: (i)

(ii) (iii) (b)

The funding of the PLAN to become a major maritime power and expand the Chinese navies’ duties from “offshore waters defence” to “open seas protection”. The protection of China’s prime sea lines of communication (SLOC) including those in the Indian Ocean. The eventual deployment of the PLAN where Chinese interests exist.

The 2019 Defence White Paper indicates that since regional hotspots and disputes over territorial and maritime rights and interests, as well as discord for ethnic and religious reasons are yet to be resolved, security hotspots arise from time to time in the region. This requires China to: (i) (ii)

Establish foreign military bases to protect its overseas investments. Cope with emerging challenges in the international political system.

Even though the Defence White Papers were released in 2015 and 2019, PLAN has been increasing its presence in the Indian Ocean since 2008, first with the antipiracy patrols and later with the nuclear and conventional submarine deployments. In January 2018, a Chinese “surface action group”, with an amphibious vessel for landing marine troops crossed into the Indian Ocean through the Sunda Straits showing their intent to operate in the Indian Ocean. Similarly, the first-ever joint Russian-Chinese naval exercise in the Baltic Sea in 2012 (Gady, 2019) showed the PLANs growing reach in Europe’s near seas. When talking of offshore bases, Colombo, Gwadar and Djibouti have been used to refuel or station PLAN ships while the acquisition of strategically located deepwater ports in Myanmar, Pakistan, Sri Lanka and Maldives have the potential to serve a military purpose. Even with these bases, there are various gaps in the protection of SLOCs from West Africa around the Cape of Good Hope and hence the need to have more bases near Mauritius or in Tanzania to support the Southern Indian Ocean SLOCs. Furthermore, defence of the existing bases cannot be maintained using 4000mile-long logistic chains from mainland China but would need to be supported from other bases enroute. Such an additional base would however hinge on factors such as strategic location, presence of Chinese state-owned firms, host-country reliance on Chinese capital, the host country’s attitude and support for China’s military presence in their country and willingness to take China’s side in times of conflict. While China is developing infrastructure in various countries and ensuring the involvement of its military in these countries, such an endeavour is ensuring that the Chinese military gains and grows in a number of ways that include interpersonal ties due to training opportunities, institutional ties due to sale of arms, intelligence collection and creating a belief that China’s military modernization can benefit the region.

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The Future of Such Gameplays Since 2013, China has made many efforts to open secondary routes so as to avoid the Malacca Dilemma (Storey, 2006).5 However, due to a lack of economic viability of many of the projects, they have not manifested on the ground while others, such as the Sino-Pakistan and Sino-Burmese pipelines face security concerns in the form of potential sabotage by insurgents and terrorist groups wherein these alternatives to the Malacca dilemma would be irrelevant. This, notwithstanding, the Chinese navy’s ability to operate in the Middle East and Western Indian Ocean is likely to increase in the near to medium term due to their deploying more modern ships in the region, leveraging their commercial fleet to support military operations and their ability to utilize places like Djibouti as a logistics centre and possibly as a command-and-control hub. This said China needs to be wary that foreign relations necessitate a greater degree of non-military cooperation too. What is however seen in the case of China are multifaceted approaches to develop and defend its geopolitical ambition which in a longer run may not be productive for China. Due to India’s strategy for the IndoPacific and limited involvement of the United States in this region China continues to grow stronger through its geopolitical, geoeconomic and geostrategic gameplays even though some analysts doubt the viability of many of these projects (Small, 2018). Such investments clearly reflect Beijing’s views about the regional strategy, it employs (Hannah, 2019) which are thus natural to continue in the years to come. As can be seen, the Defence White Papers are merely a follow-up of what gameplays China has been executing to date and a mere effort to legitimize its actions. With the 2019 Defence White Paper emphasizing on foreign bases, it is natural to see more such bases taking shape across the world. After all, when America can have 800 overseas bases in 80 countries, why wouldn’t China aspire to the same? Similarly, it is also natural to see increased Chinese involvement in the internal politics of various countries as mentioned in their Defence White Paper.

Conclusion China’s large and growing economic investment is reshaping the region, forcing regional governments and regional powers to adapt. As Beijing continues collaborative trade and commercial initiatives, investing vast sums of money, its influence is likely to continue growing. However, despite its gameplays, it faces risks of costly regional reversals as seen in many of its projects in the BRI. It may also find its growing military presence, maintenance of allies, political influence and maritime access expensive to maintain in the long run. Since the Indian Ocean is a waterway that makes trading in Asia possible, sustained domination of the Indian Ocean by any single power is not likely to last

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long and is likely to be resisted. Since China wishes to protect its economic investments along the Maritime Silk Road, we can expect China to increase its military footprint in the Indian Ocean. But how long will they be able to continue to dominate is for time to tell. For the present, the Chinese gameplay for unabated control of the Indian Ocean Region is playing out well. Notes 1.

2. 3.

4.

5.

Sea trade is carried by merchant ships along the most suitable sea routes, which are usually the shortest navigable routes that provide the best environmental conditions and proximity to staging ports enroute. These internationally used sea trade routes are called International Shipping Lanes (ISL). However, in times of tension and conflict, a nation may prefer other sea routes for its merchant traffic or to sustain a maritime/ expeditionary operation, which it can protect from interdiction by the adversary. Such routes, which may coincide in part, full or not at all with ISLs, are termed as the Sea Lines of Communication (SLOC) of that nation. Ethiopia in 1970, Tanzania in 1961, Djibouti in 1979, Kenya in 1963 and so on. Cooperation in the form of technological transfers, scientific collaboration and technical assistance, humanitarian aid and cultural exchanges that enable understanding of cultures between people of different countries. A “place” is used as a centre of operation by the armed forces or others; while a headquarters for armed forces is called a “base”. A base is usually directly owned and operated by the military or one of its branches that shelters military equipment and personnel and facilitates training and operations. The Chinese have two ambitious projects to address the Malacca Dilemma. One is to transport oil and gas from Gwadar port in Pakistan to Western China through the China Pakistan Economic Corridor (CPEC) and other is to transfer China’s hydrocarbon imports from Kyaukphyu (Sittwe) in Myanmar to Kunming in China.

References Becker, J., Downs, E., De Thomas, B., de Gategno, P. (2019). China’s Presence in the middle east and western Indian Ocean: Beyond belt and road, RANS Report. Retrieved February 2019, from https://www.cna.org/CNA_files/PDF/DRM-2018-U-018309-Final2.pdf Carter, D. J. (2018). The Great Game’s new player: China’s belt and road strategy for central Asia. Graduate Theses and Dissertations. 16558. Retrieved from https://lib.dr.iastate.edu/etd/16558 Chengappa, B. (2019). Strategy behind China’s foreign military bases. Retrieved August 14, 2019, from https://www.thehindubusinessline.com/opinion/columns/strategy-behind-chinas-for eign-military-bases/article29093793.ece Gady, F. -S. (2019). China, Russia kick off bilateral naval exercise ‘Joint Sea’, The Diplomat. Retrieved April 29, 2019, from https://thediplomat.com/2019/04/china-russia-kick-off-bilateralnaval-exercise-joint-sea/

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Green, M. J. (2018). China’s maritime silk road, strategic and economic implications for the IndoPacific region, CSIS Report. https://www.csis.org/analysis/chinas-maritime-silk-road Hannah, H. I. (2019). The great game moves to sea: Tripolar competition in the Indian ocean region. Special series—Southern (Dis)Comfort. Retrieved April 1, 2019, from https://warontherocks. com/2019/04/the-great-game-moves-to-sea-tripolar-competition-in-the-indian-ocean-region/ Holmes, J. R., & Yoshihara, T. (2008). China and the United States in the Indian Ocean: An emerging strategic triangle? Naval War College Review, 61(3), 41–60, 373. Retrieved from http://www.usnwc.edu/getattachment/Research---Gaming/China-Maritime-Stu dies-Institute/Published-Articles/NWCR_Strategic-Triangle-in-IO_HolmesYoshihara.pdf Shen, S. (2016). How China’s ‘belt and road’ compares to the marshall plan. The Diplomat. Retrieved 06 February 2016, from https://thediplomat.com/2016/02/how-chinas-belt-and-roadcompares-to-the-marshall-plan/ Small, A. (2018). Buyer’s remorse: Pakistan’s elections and the precarious future of the China-Pakistan economic corridor, Special Series—Southern (Dis)Comfort, Retrieved July 27, 2018, from https://warontherocks.com/2018/07/buyers-remorse-pakistans-elections-and-the-pre carious-future-of-the-china-pakistan-economic-corridor/ Storey, I. (2006). China’s “Malacca Dilemma”. China Brief, 6(8). Retrieved from https://jamest own.org/program/chinas-malacca-dilemma/

Captain (Dr.) Nitin Agarwala is a serving naval officer who has experienced various facets of a warship as a user, designer, inspector, maintainer, a policymaker, a teacher and a researcher. He has authored over 80 articles, papers, book chapters and two books entitled “Deep Seabed Mining in the Indian Ocean: Economic and Strategic Dimensions” and “Rise of China as a World Leader in Commercial Shipbuilding”. His research interests include Corrosion, Shipbuilding, Deep Seabed Natural Resource, Submarine Cables, Blue Economy, Artificial Intelligence, Climate Change and ‘Maritime technological issues’ with their linkages to International Relations and Public Policy. Rana Divyank Chaudhary has been a researcher with a number of New Delhi-based security and foreign policy think-tanks. He was a Senior Visiting Scholar at the School of International and Public Affairs, Jilin University, China, and has completed the prestigious training programs in Chinese politics, society, and culture at the Beijing International Chinese College (2014) and in Chinese economics at the Central University of Finance and Economics, Beijing (2017). He has authored over 30 articles, papers, and book chapters, a book entitled “Rise of China as a World Leader in Commercial Shipbuilding” and given presentations at international conferences held at research institutions and universities in India, China, and Singapore.

Chapter 4

Connectivity, Cooperation and Collaboration: China-South Asia Partnerships Under the Scientific Belt & Road Initiative Li Li and Jin Liu Abstract Innovation is a key word for poverty lifting and economic growth for genuine Asian rebalancing. Since the proposal of the Belt and Road Initiative (BRI) in 2013, China-South Asia Exposition was created biannually on the basis of the former South Asian Countries Commodity Fairs. Since 2015, China-South Asia Conference on Technology Transfer and Innovation Cooperation has been carried out annually in Kunming City of Yunnan, which also launched the China-South Asia Science and Technology Partnership Programme. There have been criticisms that the science BRI may be a decisive strategic manoeuvre for China to move from a rule-taker to rule-maker, that the low- and middle-income countries might be manipulated, negatively influenced by debt and environmental harm. From the regional knowledge commons’ perspective, connectivity realized during the Ancient Silk Road, cooperation among developing countries to avoid the capital adverse current, and collaborative innovation to stimulate collective wisdom may explain the self-governance mechanism of innovation commons in the region of South Asia.

Introduction Since the announcement of the Silk Road Economic Belt and the 21st-Century Maritime Silk Road (Belt & Road Initiative, BRI) in late 2013, a scientific Belt and Road Initiative (BRI) emerged. Till now, China has invested one trillion US dollars in the infrastructure plans, which also included science and technology (S&T), research and development (R&D), joint labs, collaborative innovation, and talents nurturing (Normile, 2017). As the linchpin of China’s drive to explore and harness high technology and the natural sciences, China Academy of Science (CAS) has invested L. Li College of International Development and Global Agriculture, China Agricultural University, Beijing, China J. Liu (B) School of Humanities and Social Science, Beijing Institute of Technology, Beijing, China e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_4

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over 1.8 billion yuan (about USD 268 million) in S&T projects as part of the BRI. In the past two and a half years, over 500 young scientists from the BRI countries have come to China for short-term researches, and over 1,200 received training at a technology training program tailored for developing countries (Zhong, 2019). There have been three viewpoints towards the science BRI. Firstly, as China rises as a science-development superpower, it brings a different win–win perspective from those of other leading science nations, such as the U.S., Japan, and the wealthier European nations. According to this view, BRI is featured by a heavy domestic focus—to address deepening disparity as the national economy modernizes, to spur growth in the underdeveloped hinterland and rustbelt, and to export China’s technological and engineering standards, which is crucial to upgrade the country’s industry (Cai, 2017: 1). Secondly, realists see BRI as a multifaceted grand strategy of China, or as a decisive strategic maneuver to move from a rule-taker to rule-maker (Zhou & Esteban, 2018: 487–501). They expressed their anxieties that the low- and middle-income countries might sleepwalk into the arms of an authoritarian and neocolonial state, being negatively influenced by debt and environmental harm. Thirdly, according to foreign experts specialized in certain areas of China, like Christopher Cullen, a historian of Chinese science at the Needham Institute in Cambridge, U.K., it is still too early to judge how China’s dealings with BRI countries will evolve (Masood, 2019: 21). As most transnational projects in the globe, the science BRI practices may be double-edged. To make a sound project out of the current one, past experience for governing the commons might be learnt, and new methods might be innovated. This paper attempts to examine those practices in South Asia countries, to analyze how the S&T partnership between China and BRI countries in South Asia came into being, and what are the factors to make it sustainable.

Conundrums for the “New-Commons” One lasting puzzle for the problem of collective actions for public goods, or commons, is that the larger-scale a group is, the more costs there will be, and the more easily free riders may emerge. That’s also a reason why the effects of global climate agreement cannot catch up with the deteriorating paces of climate changes. However, innovation is based on a special type of knowledge commons, which welcomes larger scales, free-riders, open sources, for all the producers could also be the users and the consumers in a collaborative innovation network. Intellectual property rights are legal protection tools to guarantee the trustworthy manner to quote each other, so as to amplify individual impact, to provide more commons. To understand that uniqueness of knowledge commons, we may review the process of public goods theories. Since the 1830s, scholars started to discuss the “Tragedy of the Commons”. Some analyzed from the Malthusian theory of population (Lloyd, 1833: 28–31), others seeking for private solutions for public expenditures (De Viti De Marco, 1936). Till 1950s, public finance was typed as collective consumption goods (not private ones)

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featured with externality and jointness, which everyone expects to maximize its outputs, with minimal inputs (Samuelson, 1954: 387–389). In 1968, Garrett Hardin quoted William F. Lloyd to further examine the “Tragedy of the Commons” problem, illustrating the picture of a vast pasture with many rational herdsmen, who freely raised increasing cattle to maximize their gains. Finally, freedom in a commons brings ruin to all (Hardin, 1968: 1244). Thus, a “public good” is defined as any good that cannot feasibly be withheld from the others in that group (Olsen, 1965: 14–15), which indicates non-excludability, and exhibits another trait of “jointness of supply” (Head, 1962: 197–219). Since 1990s, multi-disciplinary research mushroomed addressing virtual communities, congestion, and free-riding dilemmas of knowledge commons (Rheingold, 1993; Hess, 1995; Kollock & Smith, 1996: 109–128; Huberman & Lukose, 1997: 535–537; Gupta, 2002: 38–46). The most prominent scholars of this “new-commons” were those who were studying property rights. They put Hardin’s Commons into a “Tragicomedy of Commons”. If appropriate rules, conflict-solution mechanisms, and well-defined group boundaries are provided, the tragedy of commons could be turned into “comedy” by public, private and communal actors (Feeny, 1990: 1–19). And according to the Nobel Prize winner, Elinor Ostrom, the principles of governing the commons (Ostrom, 1990: 90–102) seemed also working for “anti-commons” in the knowledge arena, indicating potential underuse of scarce scientific resources caused by excessive intellectual property rights and over-patenting (Hess & Ostrom, 2007: 11). As the legal scholar Yochai Benkler from Harvard University proposes, the internet and digital technology have enabled peer production of the knowledge commons, changing passive consumers into primary producers through joint efforts. Different from bureaucratic administration or market economy, peer production is a process for a brand-new paradigm of public goods producing (Benkler, 2003: 1256; Benkler, 2000: 579). As Peter Levine pointed, peer production is vulnerable if they fail to defend themselves against rival alternatives, so institutions like libraries and universities remain vital for newly emerging knowledge commons (Levine, 2002: 5–8). The new paradigm implies there is much to learn from successful efforts, as well as from failures (Ostrom, 1999: 278–282). Innovative knowledge originates from practices. In 1985, when the South Asian Association for Regional Cooperation (SAARC) was established, it aimed to provide mutual aid and cooperation for seven South Asian countries, namely, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka. Later, with its enlargement of member countries and issue diversities, technology transfer and collaborative innovation were put onto agenda. After the launch of BRI, the city of Kunming, capital of Yunnan province, has been enhanced as a hub of China to promote connectivity with South Asian countries for innovation diplomacy. Throughout history, as long as there are entrepreneurs advocating to provide public goods or commons, new problems would arise, such as the critical narrative mentioned above. Collaborative innovation, based on familiarity with local conditions, is the key to solve those problems for bright futures. Local experiences would start another round of “commons-governing” and stimulate new ideas for institutional evolution with a sense of polycentricism. From the South Asian experience, knowledge commons were produced and provided for

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local people to be better off. There have been cases tuning up innovative knowledge to the direction of good governance, which might be further explored, instead of taking the plunge of denying the sincerities of the “knowledge entrepreneurs”.

Ancient Silk Road: Origins of the Common Challenges Earlier than the Northern Silk Road from Xi’an to Rome, there had been three Southern Silk Roads trading teas and horses from the Southwest of China with foreign countries—the East Route started from Sichuan province to the South China Sea; the Central Route set out from Sichuan, via Yunnan, to the Indo-China Peninsula; and the West Route departed from Sichuan, going through Yunnan, arriving at the western coasts of Asia and Africa. Both routes were no less than 3,000 km in distance. During the commercial exchanges, culture communications went along. People on these two routes got to know each other. They faced similar challenges such as the blocked mountains and rivers, thus possessing similar problems to solve, and closely related difficulties to tackle. The first difficult problem tackled was connectivity.

To Be Connected: Innovation Key for Living The scientific philosopher, Thomas Kuhn, assumed that “crises are a necessary precondition for the emergence of novel theories” (Kuhn, 2012: 67). A prominent problem on the Ancient Tea-Horse Road was that the geographical configurations were so complicated—high mountains, deep valleys and dense forests. There had been numerous poems describing how dangerously high altitude it was in Sichuan. The best-known was Perilous Journey to the Land of Shu (Shudao Nan in Chinese, “Shu” is the short form of Sichuan province) by Bai Li of Tang Dynasty, which depicted with exaggeration that the Shu route was more daunting than climbing the sky (Yong et al., 1978). To be connected was the first priority for the ancient people, partly for trading and communication, and partly for wars. Ordered by the tribal leaders or kings, ways were explored and constructed, and goods like the Shu Silk made from Chengdu of Sichuan were still successfully conveyed to Myanmar, India, Afghanistan and Europe (Harvey, 1983). The West Route of the Ancient Silk Road, Shu (meaning Sichuan province) Shendu (meaning India) Dao, extending to Central Asia, West Asia and the Mediterranean Sea in Europe, was the earliest carrying line from China to the West. Ways to build that line included hand-made planks, trestles, and caravans (trains of horses carrying bulk cargos) on the cliffs, which condensed blood, sweat and even lives of soldiers and workers. During the past thousands of years, roads, railroads, airlines and information networks were gradually made possible, so that conditions for industrial development, personnel exchanges and financial cooperation could be put as the basis for economic growth and international trading (Zong, 2018).

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Fig. 4.1 Knowledge Innovation Logics of ICIMOD

From the case of Shu Route, it could be seen that transportation innovation started when people realized their lives were in crisis. Conforming to that logic, there have been many collaborative innovation groups of people tackling those crisis in mountains between South Asian countries and China. For example, in 1983, eight members of the greater Himalayan region (Afghanistan, Bangladesh, Bhutan, China, India, Myanmar, Nepal, and Pakistan) established the International Centre for Integrated Mountain Development (ICIMOD), headquartered in Kathmandu of Nepal. ICIMOD is an international independent mountain learning and knowledge innovation centre, committed to improving the sustainable livelihoods of mountain peoples. The entity undertaking China’s responsibilities is the Institute of Mountain Hazards and Environment of China Academy of Science (CAS) sited in Chengdu. As Fig. 4.1 illustrates, to realize secure and sustainable livelihoods of mountain people, transnational collaborative innovation clusters are organized spontaneously or systematically. Following the spiral logics of the right figure, a knowledge management (KM) life cycle is designed for sustainable innovation, leading to the birth and prosperity of relevant disciplines, industries and organizations.

S&T Cooperation: Invisible, but in Great Need Connectivity created solid foundations for regional cooperation, starting from trading and commercial exchanges, later extending to S&T, innovation, and education. Since 1980s, advocated by the President of Bangladesh, Ji-yaur Rôhman, the South Asian Association for Regional Cooperation (SAARC) was established at Dhaka in 1985, with India, Bangladesh, Bhutan, Nepal, Pakistan, Sri Lanka and Maldives as 7 members, headquartered in the Nepalese city of Kathmandu (Oldenburg, 1993: 43– 44). In early 1990s, India carried out the Look East policy. Free Trade Agreements (FTA) have been seen between India and Sri Lanka since 1998. In the second stage

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starting from 2002, India promoted regional integration by establishing partnership with member states in the Association of Southeast Asian Nations (ASEAN) (Chatterijee, 2007: 65–81). In 2005, when Afghanistan was absorbed as a SAARC member country, China and Japan, were also accepted as observers. The win–win outcome of tariff reduction and other trading-friendly measures had been self-evident for all stakeholders. However, although Indian government had proposed to set up FTA with China in 2003, and Chinese government advocated it again in 2006, there was still cold-war mentality in the Indian public, due to the strategic structural status, border issue, and misperception on China’s market economy (Wu, 2007: 19–23). In 2012, China became the biggest trading partner of India (India Briefing, 2014). In addition, the stagnation of Doha Round Negotiations of the World Trade Organization (WTO) provided opportunities for Indian leaders to promote trade cooperation (Singh, 2005). In 2015, China and India reached a quasi-FTA through the Regional Comprehensive Economic Partnership (RCEP), in which both had agreed to eliminate bilateral trade tariffs by 42.5% (Sen, 2015). With that breakthrough in mind, in October 2019, despite domestic fears for cheaper Chinese imports, Indian government officials are making efforts to join a China-led free trade pact, in order to offset economic slowdown by getting greater access to overseas markets and upgrade Indian global supply chains to high-end goods, such as electronics and engineering (Reuters, 2019). With those achievements in visible infrastructure, S&T, innovation and education elements were also developed during the trade and economic growth. Much earlier than the formalized agreement for S&T cooperation, there had been an Agreement of Cooperation of S&T between the Government of the Republic of India and the Government of the People’s Republic of China signed on 22 December of 1988, during the visit of former Prime Minister Rajiv Gandhi to China. A mechanism of India-China Joint Committee Meetings on S&T Cooperation was created, being held in New Delhi and Beijing in turn. Priority areas were identified, including agriculture, fisheries, chemical S&T, medical S&T (including traditional knowledge and medicine), biotechnology, electronic hardware and IT (including software development), laser, material S&T, remote sensing, Earth sciences (including earthquakes and natural disaster mitigation), aeronautics, astronomy and astrophysics and high energy physics (Embassy of India Beijing, 2019). With those knowledge branches marked by the disciplines in genealogy, relevant industries, universities, laboratories, policy-makers, teachers, researchers and publishers could be connected through innovation networks. Technology has the connotation not only for hardware, but also for the software as the knowledge traditionally categorized in the domain of science. By comparing similarities and differences among South Asian countries, India had been drawing S&T and Innovation (STI) policy-making and transition lessens from China and other countries. For example, the development-based STI, the University Science Parks offsetting problems of technology markets, and to make a roadmap with appropriate changes along the entire innovation chain, have been considered as effective methods for India to learn (Sandhya, 2018: 1–16). Those know-hows are invisible, but fitting the fundamental interests of people of China and South Asian countries.

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Innovative Collaboration: Wisdom of Collective Since the proposal of the Belt and Road Initiative (BRI) in 2013, China-South Asia Exposition was created biannually on the basis of the former South Asian Countries Commodity Fairs. Since 2015, China-South Asia Conference on Technology Transfer and Innovation Cooperation has been carried out annually in Kunming City of Yunnan, which is located at the middle point on the Ancient Silk Road. This platform is for, but not limited to South Asian countries, developed countries, and those from other regions or continents, are also welcomed. Till now, over 90 countries, hundreds of enterprises, about 800,000 visitors had been connected with scientists and private innovators via the China-South Asia Technology Transfer Center through various projects (Jin, 2016). Before, during, and after those get-together, innovators form clusters through face-to-face interview, personal chatting, e-mails, or even WeChat, to study specific research questions, like traditional medicines to cure rheumatoid arthritis (Wu, 2015), techniques to remove organic matter from wastewater (Masood, 2019: 20), and so on. Spontaneously, innovative growth points could be visually seen from the collaborative network of research innovation, which could be based as a date reference for industry cooperation between specific countries, provinces, cities and even more small units in South Asia. As is illustrated in Fig. 4.2, due to the English language limitation and few core journals in non-Western world, although Beijing could be regarded as a competitive city in the global innovation city network, the U.S. and Europe still take the lead in both individual and collaborative innovation in most of the disciplines. Based on the China-South Asian S&T knowledge commons platform, the problem-solving practices could facilitate various actors on different levels (national, local, communal, etc.) to innovate collaboratively. This could not only encourage cities like Kunming of Yunnan, and Chengdu of Sichuan to establish world-class university, disciplines

Fig. 4.2 Top 500 cities by scientific output in 2017

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and talents with global competence, but also stimulate more wisdom from South Asian localities and stakeholders in a collective way. Abiding by the “Local Action, Global Thinking” idea, BRI is also a way to avoid the capital contra-flow from poor countries to rich countries (Li, 2015: 64–70), and could be better understood as one part of the 2030 Agenda of the United Nations (UN). Since its inception in 2015, the 2030 Agenda has provided a blueprint for shared prosperity in a sustainable world. According to the Sustainable Development Goals (SDGs) Report 2019 of the UN, progress has been made in critical areas related to the 17 Goals, and some favorable trends are evident: extreme poverty has declined considerably; countries are taking concrete actions to protect the Earth; a wide range of other actors—international organizations, businesses, local authorities, the scientific community and civil society—have engaged in a manner that generates great hope for the coming decade. However, the report also identifies many areas that need urgent collective attention, including poverty, inequality, climate change and other global challenges (Guterres, 2019: 2–3). Innovation is considered to be fostered to achieve Sustainable Development Goal 9—“Build resilient infrastructure, promote inclusive and sustainable industrialization”, which can unleash dynamic and competitive economic forces that generate employment and income, facilitating international trade and enabling the efficient use of resources. However, to meet the 2030 target, the least developed countries (LDCs), like Bangladesh, Bhutan, Maldives and Nepal, must accelerate the pace of manufacturing sector, and scale up investment in scientific research and innovation (United Nations, 2019: 12, 40). Science and technology (S&T) has also been identified as one of the key means to implement Goal 17—“Partnership for the Goals”. The leading actor is the Asian and Pacific Centre for Transfer of Technology (the AP Center). The AP Center was established in 1977 under the Economic and Social Commission for Asia and the Pacific in the UN. It aims to support member countries in nurturing and strengthening national innovation systems and to create an enabling environment for the development and transfer of technology to meet challenges in the globalized knowledge-based economy. From 2016 to 2018, the AP Center has carried out 31 activities, 10 of which were held in the South Asian country of India, and 5 in the Southeast Asian country of Thailand. In China, there were two activities held in Kunming city of Yunnan Province (ESCAP, UN, 2018: 1, 9, 10, 16).

Conclusion As Chinese top leaders heard about criticisms on environmental impacts of BRI, they invited heads of states of BRI countries to the B&R Forum on 25 April 2019. Chaired by President Xi Jinping, they expressed intents to work together with international organizations, including conservation groups and universities to tackle the potential or existent negative factors. For example, experts suggested to avoid building roads or rail near earthquake epicentres or near heritage sites, and to observe seriously on environmental problems likely to take place on the vast network of transcontinental

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routes. That means China’s policy-makers are highly sensitive to criticisms and will be keen to resolve them (Masood, 2019: 22–23). Connectivity, cooperation, and collaboration among developing countries might be a miraculous way to change that capital contra-flow puzzle, which seems as a given trajectory with inertia. As the biggest continent with the largest population, Asia is an extremely polarized land with few developed countries like Japan and South Korea. Innovation is a key word for poverty lifting and economic growth for genuine rebalancing. As one part of the SDGs, innovation and S&T in the BRI projects are intimately interconnected and explicable by reference to challenges all Asians faced with. When President Xi Jinping proposed the idea of “building a human community with a shared future” in March 2013, he said, “Only you yourself know if the shoes fit well” (Xi, 2019). That indicates China is to abide by the consensus of “seeking common ground while shelving differences” reached by representatives of the 3rd World on the Bandung Conference in 1955. The BRI is an incorporate embodiment of the “Fitting-Shoes Theory” to design a non-exclusive platform without seeking dominance of regional affairs (He & Zhang, 2013: 6–13). As Lynn White, the US historian of technology, pointed out, the ancient European development had benefited a great deal from the ancient Eastern civilizations, from scientific discoveries to technological inventions (Needham, 2001: 11–12). According to the famous Cambridge sinologist, Dr. Joseph T. M. Needham (Yuese Li in Chinese), In 1958 I travelled some 12,000 miles within China. My most outstanding impression was the unreality of the idea so cherished in the West that the population is dragooned to perform its tasks. On the contrary, everywhere one saw co-operation, spontaneity, enthusiasm for increasing production and modernization, pride in an ancient culture equipping itself to take its rightful place in the modern world. A new type of social engineering, the product of leadership from within, not from above, raises up movements as urgent popular demands and not as any mechanical result of drives from the central government (Needham, 1969: 53).

From what Needham depicted, even during the “Great Leap Forward” period (1958–1960), Chinese people had been spontaneous and innovative, which was beyond the Westerners’ imagination. The elixir of eternal life invented by Taoist pharmacists, which was also the origin for gunpowder and fireworks, laid foundation for chemistry and pharmacology in the modern Western science (Needham, 2001: 35–72). Through the ancient Silk Road in the Han Dynasty (202 B.C.– 220 A.D.), products were traded between the East and the West, and civilizations were exchanged. Today, through BRI, by transferring the welding techniques, Chinese technicians from the Geely Automobile Joint Venture helped the engineers in Belorussia to realize their dream of car manufacturing (Wu et al., 2017). The “Blue Whale” ultra-deepwater double-tower semi-submersible drilling platform, independently innovated and constructed by China International Marine Containers (Group) Ltd. (CIMC), could cooperate with BRI countries in the deep-sea oilfield operation (Su, 2017). According to the CEO of the Bangkok Bank, Suwatchai Songwanich, “Although the building of infrastructure is a major component of the BRI, it goes well beyond this. The joint communiqué signed on the 1st Belt & Road Forum carried

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commitments to support free and inclusive trade, cooperation on innovation, research, environment, telecommunications, investment and finance, with both regional and global concerns” (Songwanich, 2017). In the twenty-first century, the world scientific center will not be confined within one certain nation state, as what the Japanese historian of S&T, Mintomo Yuasa—who identified Italy, the U.K., France, Germany and the U.S. as the former 5 centers— had expected. The new centers may be transnational collaborative innovation clusters surrounding specific specialties in the most vigorous disciplines (Yuan, 2005: 68). Therefore, BRI might be compared to a go (chess) approach, which is non-linear, different from the Western way of thinking (Lai, 2004: 1–35). Furthermore, it’s even not a “zero-sum” game, but a “positive-sum” one advocating collective actions for regional commons in order to achieve better lives of all.

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Li Li is an Associate Professor at College of International Development and Global Agriculture (CIDGA), at China Agricultural University (CAU), Candidate of “CAU High-Level Talents Introduction Program” in 2020. She got her Ph.D., M.A. and B.A. degrees of Law in International Relations (IR) and Diplomatic Studies at China Foreign Affairs University, Beijing. She was a 2011– 12 China-US Fulbright Scholar in the Political Science Department at University of Connecticut. Her research interests include: international development cooperation, global public goods theory, South-South and Triangular Cooperation (SSTrC), and China development experience. She has published three scores of papers in the Hague Journal of Diplomacy (SCOPUS), Global Transitions, Nankai Journal, Foreign Affairs Review, etc., and two books–Public–Private Partnerships in Global Climate Governance in 2013, and Innovation of Social Sciences: More Precious than Gold in 2017. She won paper and teaching awards by the International Political Studies Committee of Beijing Association of Higher Education in 2016 and 2019. She managed or joined programs funded by National Social Science Fund, Ministry of Education (MOE), Beijing Social Science Foundation, EU Commission, Foreign Expert Bureau, etc. She peer-reviews for Journal of Contemporary Eastern Asia (SCOPUS), China Population Resources and Environment, Pacific Journal, etc.

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Jin Liu is an Associate Professor of School of Humanities and Social Science at Beijing Institute of Technology (BIT). His main research areas include comparative higher education, international academic mobility, Big Data and Artificial Intelligence (AI) in education, and enrollment equality. He was a visiting scholar at MIT, Boston College, and Tufts University. He is the Principal Investigator and leader of the Belt & Road Higher Education International Research Group. He has published more than 140 academic papers, 9 books, and funded by 3 grants from National Science Foundation of China (NSFC). He has organized and chaired 5 international conferences on the Belt & Road Higher Education research.

Chapter 5

Spatial Conquest by Other Means: Assessing the Geopolitical Impact of China’s Belt and Road Initiative Katja Banik and Jan Lüdert

Abstract The paper offers insights into geopolitical shifts resulting from China’s increasing global presence, deepening our understanding of China’s overall security strategy. This chapter foremost considers structural problems and geopolitical challenges resulting from China’s Belt and Road Initiative (BRI). The authors’ central contribution is to argue that BRI is usefully conceptualized as more than an economic and military security arrangement. BRI, in fact, helps Chinese leaders bridge internal and external pressures by enhancing domestic order and exerting influence beyond Asia. Crucially, the authors propose to treat BRI as a novel spatial security arrangement and as part of China’s grand strategy for rebalancing global order. Throughout the chapter, the authors make this argument by tying together discussions of BRI’s consequences for Asia, Europe, and the US. In the final analysis, the authors concur that while uncertainty persists, conflict resulting from China’s rise is not an inevitability. It remains, in a large part, up to the West to help construct a peaceful future.

Napolean once cautioned: “Let China sleep; when she awakes, she will shake the world”. Not only has China awoken, but the world around it is rumbling with the rise of national populism in the West and elsewhere. Former President Donald Trump’s “America first” policy and Chinese President Xi Jinping’s Belt and Road Initiative (BRI)—designed to revitalize the Silk Road—are two developments demonstrating an ostensible shift in world affairs. World politics is, ostensibly, going through a significant historical transformation. In China, these changes are observable in a growing personality cult surrounding the Chinese President and the introduction of China’s Social Credit System (SCS). In Europe, a crisis of confidence in democratic institutions is sweeping through the European Union (EU), resulting in the United Kingdom’s decision to leave the EU (Brexit). Similar developments across K. Banik PwC’s China Compass, Hamburg, Germany J. Lüdert (B) City University of Seattle, Seattle, USA e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_5

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the Atlantic, particularly since the one-term US presidency of Donald Trump, all point to decisive disruptions in world affairs.

World Politics at a Crossroads The installment of protectionist measures and the drawn-out trade war between the world’s preeminent rivals, the United States and China, are but the latest iterations of their systemic rivalry. Less united than ever, the EU internally contends with the impacts of Brexit across a fragile and seemingly disjointed European project. These pressures are compounded by an increasingly disgruntled citizenry, critical of the EU’s lack of efficacy in responding to a range of challenges. Europe’s future—its identity and its role in world politics—are being thrown into question amidst a struggle for geopolitical preeminence between the US and China. We find ourselves in what Banik (2019) termed a “G-Zero” world: a world in which no state, region, or group provides the necessary leadership or normative bedrock for an interdependent world. In this “free-for-all”, multilateral approaches are undermined by political strategies that align with national interests alone. With global uncertainty compounded by the Covid-19 pandemic, each country or region is seeking effective solutions to the ever-growing challenges posed by globalization, pursuing disjointed strategies that often put other actors at a disadvantage. The costs of such interest-based divergences are unknown, but they hold the potential to further intensify geopolitical discord. As Graham Allison (2018) puts it, a key to the future of global order is to recognize the tectonic structural stress that Beijing and Washington must master to construct a peaceful relationship. We agree with this assessment, asking: will this G-Zero world ultimately lead to a bipolar system dictated by US–China relations? In such a world, a common EU foreign policy strategy that bridges interests vis-à-vis China and the US would be more necessary than ever. Alternatively, will a multipolar system characterized by peaceful cooperation prevail? The result could be a world in which actors act, certainly in competition, but in a complementary manner. New international regulations and governance standards could provide a framework for “cosmopolitical” global coordination while averting military conflict. In this scenario, the EU, above all, could define a strategy that prevents it from falling at the mercy of either China or the United States. After reviewing the main characteristics of globalization, internationalization, the competition among nation-states, and transnational forces, this paper deepens our understanding of China’s overall strategy to exert influence beyond Asia by analyzing BRI as a geopolitical instrument that contributes to Allison’s notion of tectonic stress. Conceptualizing BRI as a novel spatial security arrangement better captures the domestic and international dimensions of BRI as a political, economic and security strategy. Finally, in keeping with the geopolitical vision of Jacques Ancel, we discuss the importance of bridging differences and cultivating an “identity of the heart” by

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concluding that although conditions of uncertainty persist, conflict resulting from China’s rise is not an inevitability, as the West can help build a peaceful future by focusing on mutual understanding.

Deterritorialization and Transnationalization Under Globalization Geopolitics—the study of territory and power—provides the theoretical basis for this paper. Globalization is understood as the interdependent movement of people, goods, services, capital and information across borders. While the concept is not new, the novelty lies in the depth of interdependence between nation-states and the impact of various non-governmental actors (e.g. MNCs, NGOs, interest groups, criminal networks) now crowding the international field. There is now greater competition between the national forces that arose from the old-world order and the rise of new empires, waves of decolonization, and more recent transnational forces that have resulted from this late-stage variegated globalization. Political responses to globalization have varied and occasionally conflicted. On the one hand, protectionist measures such as customs duties and border controls in Europe and the US signal a return to the logic of nation-states: restrictive immigration, homogenous cultures and closed borders. On the other hand, measures promoting economic openness and expansion are still being undertaken, from China’s re-conquest of the old Silk Roads to the harmonization of European trade and defense policies (e.g. the Common Security and Defence Policy, an integral part of the Common Foreign and Security Policy). Put simply, transnational forces resulting from de-territorialization are competing with traditional nationalist sentiments, especially when it comes to securing natural resources. This is, in part, attributed to new technologies and networks; people around the world have more (dis)information at their disposal, particularly about globalization’s harmful effects (Lüdert, 2008). Globalization has produced both winners and losers. Some countries or regions have massive international trade surpluses, while others experience large deficits and sovereign debt. Cross-border economic crime, illicit transactions, and money laundering are commonplace. There has been an accumulation of wealth in some regions, often controlled by political-economic elites. These unequal developments fuel citizens’ mistrust of prevailing political classes and systems, which in turn has given rise to populist parties, deepened social conflicts, and challenged the effectiveness of the democratic system using a “clash of civilizations” logic (Lüdert, 2018). Nonetheless, actors involved in this geopolitical moment are united by shared challenges: international terrorism; the effects of climate change; global pandemics; competition for natural resources; chronic economic, social, and political crises stemming from an illegal and opaque global economy; widespread political apathy; and digitization, which has radically changed how people work and interact. Built during

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a different time, existing international institutions and organizations often fall behind, no longer offering innovative solutions and undermined by states questioning multilateralism and underfunding global initiatives. As a result, the post-war order that emerged on the eve of the Second World War is ostensibly in decline, while a new world order has yet to take shape.

The Belt and Road Initiative: An Emerging New Order? With the revitalization of the Silk Roads, the contours of a new world order are unfolding. BRI marks a turning point in China’s national policy, with the stated purpose to: promote the connectivity of Asian, European and African continents and their adjacent seas, establish and strengthen partnerships among the countries along the Belt and Road, set up all-dimensional, multi-tiered and composite connectivity networks, and realize diversified, independent, balanced and sustainable development in these countries (NDRC, 2015).

BRI targets infrastructure and commercial networks throughout Eurasia, an area of great geopolitical and commercial importance, and is intended to strengthen links between China and states all along the belt. It is not a single project, as there is no master plan, but is comprised of a multitude of roads, railways, and waterways including the Pacific Silk Road—which passes through the Arctic Ocean—and the Digital Silk Road—which covers cyberspace (The Economist, 2018). All of these are central to “Xi’s China Dream” of “rejuvenation” (fuxing, 复兴)—which can also be translated to, and understood as, seeking a Chinese “renaissance” (Allison, 2018, 122). Covering over 65 countries with a combined population of more than three billion, BRI is essentially a form of spatial and territorial expansion that focuses on major infrastructure projects. The 2015 action plan presented the Silk Road Economic Belt (SREB) and the Maritime Silk Road Belt (MSR) with a total of six corridors. Under the leitmotif advanced by the Communist Party of China (CPC) of developing the region’s wealth and preserving peace, friendship, trust and understanding, roads and sea routes will connect China to Central Asian countries, Russia, and, eventually, Europe—but especially to Africa, where the continent’s oil reserves remain largely untapped. The broader normative context, beyond BRI’s spatial consequences, is China’s advancement of security concerns through partnerships, not alliances. China particularly opposes US alliances in the region which it views “as a bulwark against the advancement of Chinese strategic interests” (Morton, 2017). To secure sustained financing, China has established two institutions: the 57 member-strong Asian Infrastructure Investment Bank (AIIB) and the Chinese-sovereign “Silk Road Fund”. These institutions are complementary to, as opposed to competitors of, the International Monetary Fund (IMF), the World Bank (World Bank), and the Asian Development Bank (ADB).

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Political leaders in the countries along the “belt” welcome BRI as it promises to improve infrastructure, ensure connectivity, and subsequently promote economic development. However, as with other Chinese investments, compliance with multilateral standards and appropriate global governance regulations is not a priority for Beijing. China maintains that it provides aid in a demand-driven process to meet recipient needs. Nevertheless, corruption and opacity relating to investments flowing from China are likely to benefit political elites more than the populations of recipient countries (Dreher et al., 2016). Many scholars tend to ignore this aspect, crediting Beijing for providing African governments with a degree of “ownership” and “policy space” (e.g., Bräutigam, 2011; Kragelund, 2011; Reisen & Stijns, 2011). Yet, while a rhetoric of “good intentions” underwrites China’s aid policy and seemingly advances the norm of country ownership formalized in the Paris Declaration on Aid Effectiveness, it remains unclear who reaps the long-term benefits of Chinese development aid. This is especially the case if the recipient’s needs refer to the population en large or, as is often the case, to political elites and their clients. At a minimum, dependence on investment flows generates an imbalance in China’s favor, preventing recipient countries from maintaining economic autonomy.

China’s Meta-Strategy Through Spatial Conquest The driving factor behind BRI is, above all, a new set of ordering principles advanced by the CPC, and the project is designed to secure and control transport routes for natural resources, particularly oil and gas. This encompasses routes connecting African resource-producing countries to Chinese production sites. The most important corridor, the China–Pakistan Economic Corridor (CPEC), connects the city of Kashgar in China to the port city of Gwadar in Pakistan and is an integral part of China’s overall strategy. Where almost 80 percent of all Chinese oil imports currently pass through the Strait of Malacca, CPEC promises to significantly reduce transport time and overall costs. The heavy investment required will also improve Pakistan’s infrastructure, bolster its economy, reduce energy shortages, and, perhaps most critically, fasten Pakistan’s long-term dependence on China. At the same time, the concessional and commercial loans that finance these infrastructure projects have the potential to fuel the corruption already prevalent in Pakistan (Hussain, 2017; Luchnikava-Schorsch, 2018). BRI cannot be viewed simply as an instrument for asserting China’s power; it is better understood as an alternative meta-strategy to the prevailing liberal world order of the West. It is also why aspects beyond the economic—geopolitical, strategic and military—should be considered when conceptualizing BRI. New waterways and port construction serve more than just commercial ends. Ports may serve as military bases for the Chinese navy, as in the case of the People’s Liberation Army’s (PLA) first overseas maritime naval base, inaugurated in Djibouti in 2017 (Lagneau, 2017). With 400 troops dispatched, the PLA officially claims to support UN peacekeeping operations and protect Chinese naval operations, particularly in the Indian

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Ocean. Beyond presenting a challenge for US interests, the expansion of China’s military presence is a regional concern, particularly for India. With Sino–Indian relations stretched by border clashes and territorial disagreements in the Himalayas, among other regional issues, CPEC represents a key point of contention. CPEC passes through high-risk areas, including the autonomous region of Xinjiang and the northwest Pakistan–Afghanistan border region. The Chinese army is thus engaged in securing infrastructure construction sites, transport roads, and ports along the corridor, further expanding China’s regional military footprint. In this context, BRI must be understood as a strategy that serves Chinese security interests alongside offering business opportunities to companies in Asia, Africa, and Europe. While closer economic ties may make conflict more costly, two oft-overlooked factors are important here: (1) BRI is an ideological tool designed to maintain stability and strengthen China’s domestic order, i.e. control by the CPC, and (2) serves as a spatial strategy that intertwines civil and military interests under a rubric of “security”.

Belt and Road Initiative: An Ideology to Maintain Domestic Order While the West searches for a new global vision, China has given its geopolitical strategy a second boost. Capitalism was introduced in China in 1978 when the country opened to foreign investment and peasants were granted permission to keep their surplus production. By unleashing its citizens’ entrepreneurial spirit, the country hoped to overcome its technical and technological backwardness. Mobilization of the Chinese population bolstered national unity under a motto of becoming rich and prosperous. After years of economic growth and accumulated wealth, the CPC is using BRI both as a justification for maintaining power but foremost as a means of ensuring party unity, internal stability, and national cohesion. President Xi is strengthening his position, supported by rising patriotism amongst the Chinese people. Domestically, the country’s authoritarian regime is tightening its grip, while internationally, the Chinese economy has become an integral part of global production chains. Remarkably, China is also increasingly becoming a source of digital innovation, especially in artificial intelligence. China is flexing its muscles externally as well, notably in the South China Sea, transforming “a number of islets in the Paracel and Spratly archipelagos into military bases, where the government is building ports and airstrips” (RFI, 2017). Assured by its strong geopolitical position, the Chinese government is embarking on a more assertive foreign policy while domestically, it manages the economy as a global enterprise. Five-year plans set the economic strategies of Chinese state-owned enterprises (SOEs), both internally and externally, to ensure that domestic standards of living increase. The continued provision of social goods further legitimizes the CPC’s authority and rule. BRI thus mobilizes the nation, safeguarding the unity, stability and harmony of China at the domestic level and beyond.

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Belt and Road Initiative: A Novel Spatial Security Arrangement Above all, BRI is a “geostrategic–military” initiative, bringing together civil and military interests under the rubric of security. We argue here that BRI is more accurately conceptualized as a novel spatial security arrangement. This conceptualization is useful because intertwining interests of spatiality are at the center of almost every decision and action amongst BRI’s political and economic actors. In including BRI under the umbrella of security, China’s political strategy is essentially able to safeguard domestic and geopolitical interests concurrently. With such an understanding, several dimensions of security can be differentiated: national sovereignty and national unification; military, economic, cultural, social, scientific and technological security; security of information; security of environment and resources; and, finally, nuclear security (State Council Information Office of the People’s Republic of China, 2019). The main objective of this major security strategy is to preserve the country’s unity, prevent social unrest, and legitimize the power of President Xi and the CPC. Indeed, Xi Jinping’s proposal to former US President Obama that they jointly strive to develop a new global order in which both China and the US respect “one another’s core interests”; (Allison, 2018) meant, for Xi, mutual respect for an emerging spatial security arrangement that is now a reality of BRI. While BRI is reshaping geopolitical ties between China and those connected to the project, China and the US are simultaneously pursuing a strategy that places national interests at the center of their interactions. Trump’s “America first” vision, the strengthening of the authoritarian regime in China, the new cult of personality surrounding Xi Jinping reminiscent of Mao’s personality cult, are all ultimately driven by domestic factors taking place within an emerging spatial security arrangement that is neither simply economic or military. Moreover, temporal factors cannot be overlooked: BRI will change the foundations of world trade in the medium term and is, at the same time, a massive undertaking that will be completed decades from now. This poses a particular challenge for a divided EU since China, as discussed, links its civil, economic and military interests through BRI. China’s influence and geopolitical–military power could thus take on a greater significance in this novel spatial security arrangement with ramifications that extend beyond those states along the route of BRI and impact the West: the US, Europe and especially Eastern Europe. That is why it is crucial to view BRI as more than an economic move that enables China to modernize state-owned companies, facilitate their financing by promoting access to markets along BRI, and thus strengthen China’s state-centric capitalism. The improved prosperity of the countries along the BRI route stabilizes China’s trade regime, a key consideration given that the Chinese economy is likely to remain heavily dependent on exports. Although a myriad of factors is concurrently unfolding within this emergent spatial security framework, it is clear that their consequences cannot be fully assessed.

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Re-bundling Territoriality: BRI and New World Politics On the eve of the twentieth century, Ruggie stated that we were entering an era characterized by an unbundling of territoriality. He, and other scholars, foresaw a fluid state system of overlapping sovereign arrangements in which multiple actors beyond the state would increasingly interact; a world that exists on “a deeper and more extended temporal plane, and its remaking involves a shift not in the play of power politics but of the stage on which that play is performed” (1993, pp. 139–140). As we sought to underscore, perhaps somewhat counterintuitive, the special security arrangement of BRI is indeed a novel stage on which an unbundling of territorial space is taking place. Through it, China pursues domestic stability, economic growth and military interests; all the while aiming to re-bundle territory along the BRI into a distinctive Chinese bouquet. As the pace of globalization slows and populist sentiments resurge, the need and desire of peoples to belong to a territory, region, or country has only increased. The dynamics of transnational flows erase neither borders nor the places delimited by those borders (Zajec, 2016). On the contrary, it is clear that the geopolitical powers of nation-states such as China, the US and Russia are alive and well. The reassertion of states is accompanied by personality cults (e.g. those surrounding Xi and Putin) and ideologies that are guided by national interests and territorial annexation. Aside from serving the pursuit of the Chinese dream, BRI is an example that raises the concept of spatial conquest by means other than war and military force alone. The strategy behind former President Trump’s “America first” campaign followed a similar logic and is one that likely continues under incoming President Biden: a call to revitalize the American dream and extend a sphere of influence beyond its borders. Both sides here agree that being an effective hegemon requires a shared vision on intersecting economic, political, military, social and cultural levels. That said, it is clear that world politics is now at a crossroads. Globalization in its current form has given rise to a new, potentially highly conflictual bipolar world, one that requires a redefinition of the world order. The resulting rivalry is playing out on several levels: ● Institutional: Democratic system versus authoritarian regime, even dictatorships. ● National versus transnational forces. ● Nation-states versus global companies, business alliances and interest groups (lobbying). ● Within the EU: Nation-states versus European institutions, and Western Europe versus Eastern Europe. To overcome this systemic rivalry, it is essential to unpack causal factors and avoid ad hoc or simplistic solutions, such as those advocated by populists on social networks. Instead, we must reset our mindset and have the audacity and imagination to design a new global governance system—one that is fairer, more equitable, and more responsive, not only to current challenges but to the needs of all humanity. (Banik).

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The crucial question is: How can we integrate these two systems of opposing values into a new structure ensuring global cosmopolitical governance?

French geopolitics provides part of the answer. It was Jacques Ancel (1879– 1943) who added a very human concept—the identity of the heart—to geopolitical considerations, a concept based on the need for balance and harmony within a society, country, or region (Ancel, 1938, pp. 97–99).

Beyond Borders: Identity of the Heart Leaders of European institutions should not underestimate the national strengths of the member states and their respective populations. According to this logic, Jacques Ancel contributed the notion of identity to geopolitics, whereby groups emerge based on a common memory, history, culture, and language, eventually defining themselves within a border: “He defends a nation of the heart in and of itself that is non-rational” (Gauchon & Huissoud, 2008, pp. 7–11). In this sense, the EU can act as an avantgarde player, questioning a power’s sustainability—values versus mercantilism. A new “cosmopolitical” order of this sort must ensure fair trade relations, transparency of transactions, social justice and, above all, a more equitable global distribution of goods and natural resources. The human dimension and the application of moral and ethical values are essential if there is to be an evolution towards cosmopolitics, a process that must respect borders and, thus, national sovereignty (Banik, 2016). In our globalized world, neither the EU, China, nor the US are isolated island paradises. No actor is privy to absolute truth. Climate change, growing global competition (for natural resources, food, water, etc.), the rivalry between national and transnational forces, and international terrorism are factors that force us to face new realities. The illusions that underlie today’s ideologies—those found in Europe; patriotic Chinese-style capitalism; “America first”; personality cults; a return to revisionist power structures—must be relinquished. We must bridge our differences and move towards cosmopolitical global governance based on human values—towards an “identity of the heart”. As BRI begins to connect Asia and Europe, let us begin by developing a “Europe of the heart” beyond EU borders in keeping with Jacques Ancel’s geopolitical vision: It is the heart which is worthwhile and which must be considered above all. Jacques Ancel.

References Ancel, J. (1938). Géographie des frontiers. FeniXX. Allison, G. (2018). Destined for war: Can America and China escape Thucydides’s trap? Houghton Mifflin Harcourt. Banik, K. (2016). Les relations Chine-Europe: À la Croisée des Chemins. L’Harmattan.

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Banik, K (2018). Europe, China and the G-Zero world. China and the World: Ancient and Modern Silk Road, 1(4). https://doi.org/10.1142/S259172931850027X Banik, K. (2019). Europe and China in a globalized world. The geopolitical impacts of Belt and Road. China and the World: Ancient and Modern Silk Road, 2(1), 1–18. https://doi.org/10.1142/ S2591729319500032 Banik, K. (2020a). Borders and identities in the globalized world. Indian Military Review, 11. Banik, K. (2020b). Borders and identities in a globalised world: A commentary. China and the World: Ancient and Modern Silk Road, 3(1), 1–13. https://doi.org/10.1142/S2591729319500251 Boniface, P. (2017). La Géopolitique. Eyrolles. Bräutigam, D. (2011). Testimony on China’s growing role in Africa. Remarks at a hearing held by the United States Senate Committee on Foreign Relations Subcommittee on African Affairs. Retrieved from https://www.foreign.senate.gov/imo/media/doc/Deborah_Brautigam_Testimony. pdf China’s exports to US fall amid trade war. (2019, August 8). Deutsche Welle. Retrieved from https:// www.dw.com/en/chinas-exports-to-us-fall-amid-trade-war/a-50342683 Commission Européenne. (2017). Le Livre Blanc sur l’Avenir de l’Europe: Cinq Scénarios [White Paper]. Retrieved from https://op.europa.eu/s/oLLG Commission Européenne. (2018). Sommet UE-Chine: Approfondir le Partenariat Stratégique [Communiqué de Presse]. Retrieved from https://ec.europa.eu/commission/presscorner/detail/ en/IP_18_4521 Dobbins, J. (2018, July 24). The global world order will outlast US leadership. The Wall Street Journal. Retrieved from: https://www.wsj.com/articles/the-global-order-will-outlast-u-s-leader ship-1532473591 Dreher, A., Fuchs, A., Hodler, R., Parks, B. C., Raschky, P. A., & Tierney, M. J. (2016). Aid on demand: African leaders and the geography of China’s foreign assistance. AidData working paper 3 revised. AidData at William & Mary. Retrieved from http://docs.aiddata.org/ad4/files/inline/ wp3_-_revised_working_paper_series_dreher_et_al_2016_october.pdf Eurostat. (2018). Communiqué de Presse: Überschuss des Euroraums im internationalen Warenverkehr in Höhe von 16,5 Mrd. Euro; Überschuss von 0,2 Mrd. Euro für die EU28, No. 118/2018. Eurostat. (2018). EU direct investment flows, breakdown by partner country and economic activity (BPM6). Retrieved from https://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=bop_ fdi6_pos&lang=en Gauchon, P., & Huissoud, J. M. (2008). Les 100 Mots de la Géopolitique. PUF. Hussain, Z. (2017). Le couloir économique Chine-Pakistan et la nouvelle géopoli- tique régionale. Notes de l’IFRI Asie Vision, 94. Retrieved from https://www.ifri.org/en/publications/notes-delifri/asie-visions/china-pakistan-economic-corridor-and-new-regional Kragelund, P. (2011). Emerging partners and governance: Does the rise of emerging partnerships increase ownership of development policies and widen the policy space for African Governments? OECD Development Centre Special African Economic Outlook 2011 Paper. OECD. Lagneau, L. (2017). “La Chine a inauguré, à Djibouti, sa premiére base navale à l étranger. Zone Militaire, August, 1. Luchnikava-Schorsch, H. (2018). The China-Pakistan Economic Corridor: Growth Catalyst or Dept Trap. Lüdert, J. (2008). Unbundling territoriality in the era of real time cyberspace. GRIN Verlag. Lüdert, J. (2018). An alternative for Germany? Tracing Huntington’s ‘Clash of Civilizations’ Thesis in a Right-Wing Populist Party. In D. Orsi (Ed.), The ‘Clash of Civilizations’ 25 Years On. E-International Relations Edited Volumes. Morton, K. (2017). Written evidence submitted by Professor Katherine Morton, University of Sheffield (CHI0039). United Kingdom Foreign Affairs Committee. Retrieved from http://data. parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/foreign-affairs-com mittee/uk-relations-with-china/written/45926.html

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National Development and Reform Commission. (2015). Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road. Belt and Road Forum for International Cooperation. Press and information team of the Delegation to China. (2016). China and the EU. European Union External Action Service. https://eeas.europa.eu/headquarters/headquarters-homepage/ 15394/china-and-eu_en. Reisen, H. & Stijns, J. P. (2011). Emerging partners create policy space for Africa. VoxEU.org. Retrieved from https://voxeu.org/article/how-emerging-donors-are-creating-policy-space-africa Reuters. (2018). L’UE réplique aux droits de douane US. Challenges. Retrieved from https://www. challenges.fr/monde/l-ue-replique-aux-droits-de-douane-us_594219 RFI. (2017, December 26). Pékin montre ses muscles en mer de Chine méridionale, Taïwan s’inquiète. Les Voix du Monde. Retrieved from https://www.rfi.fr/fr/asie-pacifique/20171226pekin-renforce-implantation-mer-chine-meridionale Richet, X., Ruet, J., & Xieshu W. (2017). New Belts and Roads: redrawing EU-China relations. In A. Amighini (Ed.), China’s Belt and Road: A game changer? ISPI. Ruggie, G. (1993). Territoriality and beyond. International Organization, 47(1), 139–174. Special African Economic Outlook 2011 Paper. OECD Development Centre. https://www.undp. org/content/dam/undp/library/corporate/Reports/UNDP-Africa-2011-Economic-Outlook.pdf State Council Information Office of the People’s Republic of China. (2019). China’s National Defence in the new era. Foreign Languages Press Co. The Economist. (2018). All under Heaven: China’s Belt-and-Road-plans are to be welcomed — and worried about. Retrieved from https://www.economist.com/leaders/2018/07/26/chinas-belt-androad-plans-are-to-be-welcomed-and-worried-about Wijeratne, D., Rathbone, M., & Wong, G. (2018). A strategist’s guide to China’s Belt and Road initiative. Strategy+Business. Retrieved from https://www.strategy-business.com/feature/A-Str ategists-Guide-to-Chinas-Belt-and-Road-Initiative?gko=8e9c5 Zajec, O. (2016). Introduction à l’analyse géopolitique: Histoire, outils, méthodes. Éditions du Rocher.

Dr. Katja Banik is a specialist in geopolitical issues, holder of a doctorate from Sorbonne Nouvelle University, on current geopolitical, economic and political issues related to China, EU and the US, focus on Jacques Ancel’s geopolitical vision “identity of heart” and global governance. She is editor-in-chief of PwC’s China Compass, and author of the book China-Europe Relations: At a Crossroads published by L’Harmattan. Further, Katja is author at moderndip lomacy.eu, and worldscientific.com. She is membre associée à Titre Secondaire at Intégration et Coopération dans l’Espace Européen — Etudes Européennes (ICEE), Université Sorbonne Nouvelle Paris 3, Paris, and a member of GIS Réseau Asie et Pacifique/GIS Études Asiatiques in Paris. Dr. Banik has senior international management expertise in the logistics (Shanghai and Hong Kong). As a member of the successor generation of the displaced population—her family had to flee on her mother’s side from Königsberg in East Prussia in January 1945 and on her father’s side from Schneidemühl in West Prussia—she increasingly connects the topics of identities and borders in her geopolitical views. Dr. Jan Lüdert is an Associate Professor at City University of Seattle where he serves as Director of Curriculum and Instruction. Dr. Jan Lüdert is a current Visiting Research Scholar at the Ralph Bunche Institute for International Studies in New York City and an Associate Researcher at Philipps Marburg University’s Dynamics of Security project. He is a World Affairs Council Fellow and a Liu Institute for Global Issues Scholar alumnus. He received a Ph.D. in International Relations from the Department of Political Science at the University of British Columbia, Vancouver. His research interests include International Relations, Political Theory, International

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History, Intergovernmental Organizations, Non-State Actors, Transnational and Cyberspace Politics, Global Norms, Human Rights, Security Studies, Public Policy, Humanitarianism, Technology, Psychoanalysis, Leadership and Ethics.

Chapter 6

Europe and the US-China Confrontation in the Indo-Pacific Sebastien Goulard

Abstract The BRI and the IPS illustrate the new pre-eminence of Asia in world affairs. Unlike China and the USA, Europe has limited influence in Indo-Pacific, but has still interests in the region. Europe is a major destination of both the continental and maritime silk roads, and a majority of European Union member states have joined the Chinese initiative. Despite shared concerns with the US regarding BRI transparency, the European Union has adopted a pragmatic approach of coordination with China through its new EU-Asia Connectivity Strategy, and Chinese influence is growing in most European countries. Although allied with the United States, European states have not modelled their Asian policy on the US. European most powerful countries such as United Kingdom and France share the American position regarding the freedom of navigation, but they do not endorse the entire US IndoPacific Strategy and resist against US pressure on their relations with China. Their Asian policy is also formulated according to possible trade deals with Asian emerging countries. Is the EU policy motivated solely by commercial motives to attract more investment from China or does it illustrate the emergence of a more autonomous European policy for Asia resulting partly from Trump’s “America First” Policy?

Introduction The Belt and Road Initiative launched by Chinese president Xi Jinping in 2013 has become a game-changer for Asia and reflects the growing influence and attraction exerted by China in the region. This connectivity project may transform the whole region with new infrastructure and facilities to boost trade; it also challenges the US leadership in the Indo-Pacific region. In 2012, US President Obama launched the “Pivot to Asia” policy that shifted US foreign policy from Europe and Middle East to Asia. This new focus on Asia results from the growing importance of Asian countries in the world economy and current affairs. This policy was also perceived as a possible attempt to contain China’s leadership in Asia. After withdrawing from S. Goulard (B) Cooperans, 55 avenue Marceau, 75116 Paris, France e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_6

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the Trans-Pacific Partnership in January 2017, the Trump administration focused US foreign policy on Asia again with the Indo-Pacific Strategy unveiled in June 2018. This strategy has both economic and security dimensions, as it consists of enhancing military cooperation with US allies, promoting transparency and market-led economy in the region. The concept of Indo-Pacific was already used by some US regional partners including Japan, Australia and India, that agreed, in 2017, to revive the “Quad”, an informal security platform that was formerly abandoned in 2008. In addition to the Indo-Pacific Strategy, the Trump administration announced other measures to compete with China’s BRI such as the creation of a new Overseas Private Investment Corporation after Trump signing the Better Utilization of Investments Leading to Development (BUILD) Act in October 2018. Although US Vice President has openly criticized the BRI and warned about the “debt trap” caused by the Chinese initiative (The White House, 2018), there has been debate about the opportunities brought by the BRI in the US closest allies in the Indo-Pacific. Thus, Victoria state in Australia signed a non-binding memorandum of understanding to join the BRI. In Japan, many companies are looking for working on the new silk roads promoted by China. Where does the European Union stand in this competition? Which of these initiatives does the EU endorse? Or can the EU afford to develop its own strategy? The role of the EU in the Indo-Pacific region is quite overlooked as it is often assumed that the EU has no Asian policy of its own and follows US position regarding Indo-Pacific affairs. The EU is more and more courted by China to join the Belt and Road Initiative, despite the European traditional alignment with US policy. But as illustrated by the EU–Japan partnership on sustainable connectivity launched in September 2019, the EU has new ambition to project its influence in the strategic Indo-Pacific Region.

Strategic Importance of Indo-Pacific Region for the European Union The EU and its members have intensified relations with Indo-Pacific countries over the years. This cooperation is illustrated by the frequent events held between the EU and the most powerful Asian nations with for example the EU-China summit and EU-India summit. A state visit to China has become an obligatory step for most EU member leaders. In September 2019, Chancellor Merkel paid a 12th visit to China since she took office in 2005. Trade issues and opportunities are European priorities in EU-Indo-Pacific relations, but the EU is also willing to define its own policy regarding security in the region. However, for both trade and security, the EU suffers from its lack of integration, to become a leading partner in the Indo-Pacific region.

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EU trade with the Indo-Pacific Region: Some Imbalanced Relations

As Indo-Pacific countries continue to power the global economy (IMF, 2018), the EU is willing to further develop trade with the region. Thus, the European Union is both India and China’s largest trading partner, and surpasses the US in trade with most Indo-Pacific countries including Japan. The EU also recently signed some free trade agreements with Singapore (2018) and Vietnam (2019) in order to boost trade with Southeast Asia, but failed to resume negotiations with ASEAN to conclude a free trade agreement. In February 2019, the EU-Japan Economic Partnership Agreement entered into force, creating the world’s largest open economic area. Although the EU is trying to deepen relations with Japan, Vietnam and other Asian nations, in the Indo-Pacific, trade with the EU is mostly dominated by China, EU’s second trade partner after the US.

Top EU trading partners in the Indo Pacific in 2018 (in € billion) 450 400 350 300 250 200 150 100 50 0 China

Japan

South Korea EU Exports

India

Singapore

Vietnam

EU Imports

2018, Eurostat If we look at each European Union member, we can also note that China is the largest Indo-Pacific trade Partner in most cases. It means that for EU member states their Indo-Pacific trade policy is mostly defined by their commercial relations with China. Furthermore, the EU suffers from a high trade deficit with China (e184.5 billion in 2018), making this issue a priority for the EU commission. However, Germany, the EU largest economy and its most influential member, is one of the few European countries to enjoy trade surplus with China. It is therefore difficult for the European Union to define a single policy regarding the Indo-Pacific region as its members do not share commercial interests.

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Security and the EU Capacity Issue

Security issues are also of great concern for the EU in the Indo-Pacific region as trade goes through disputed maritime corridors, as for trade, it is necessary to distinguish the EU policy from its members. i.

EU security policy in the Indo-Pacific

As most of its trade with Asia is transported by sea, the European Union is concerned about security in the Indo-Pacific region. However, the EU as such, has no military capacity of its own, and relies on its members for implementing its policy. The IndoPacific region has several geopolitical hot spots, and suffers from military tensions, from the Korean Peninsula to the Strait of Hormuz. The European Union through its Parliament, the European Council, the European Commission, and its high representative for foreign affairs and security policy regularly calls parties to negotiate and reduce tensions in the region. Piracy is an important issue that the European Union wants to address specifically in the Indo-Pacific region. In Western Indian Ocean, since 2008, the European Union has been conducting a naval operation to combat piracy in the Horn of Africa. Operation Atalanta is carried out by EU members’ navy forces. The European Union is committed to defending the rule of law in the Indo-Pacific region. In its global strategy formulated in 2016, the EU specifically mentioned the engagement with China based on respect for rule of law, both domestically and internationally (European Union, 2016). The EU stands for freedom of navigation and asks parties to solve maritime claims in the South China Sea by negotiations and other peaceful means (Liu, 2018). On this issue, the EU differs from the US about July 2016 CPI’s ruling (CSIS, 2016). In spring 2016, the EU voiced support for binding arbitration under the United Nations Convention on the Law of the Sea (UNCLOS), and European powers stated that China should respect the ruling from the Hague. However, on July 12, 2016, when the Arbitration Court favoured the Philippines against China, the US administration officially declared that it expected both parties would comply with their obligation, whereas the EU called again parties to negotiate (European Council, 2016). Australia, Canada, Japan, New Zealand, the Philippines and Vietnam adopted a position similar to the US one (Kardon, 2018). The EU reaction may show that there is no consensus among EU members on the position to be adopted towards China. ii.

European powers and security in the Indo-Pacific

Several European countries (United Kingdom, France, Netherlands, Portugal, and Spain) used to be colonial powers with possessions in the Indo-Pacific. Although they have lost their colonies, the United Kingdom and France still keep some insular territories at the fringes of the Indo-Pacific regions, including the Chagos Archipelago and the Pitcairn islands for the UK, Reunion, Kerguelen Islands, New Caledonia, Wallis and Futuna, French Polynesia for France. In addition, the UK maintains a

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military presence in Brunei and Singapore (logistics) at the very heart of the IndoPacific. Among EU members, France and the UK are the main powers to have a consistent Indo-Pacific security policy and US Indo-Pacific Strategy mentioned the important role of these two European allies in the US regional strategy (US Department of Defense, 2019). The two regularly organize naval patrols in the South China sea amid Chinas’ protestations. The adoption of the Indo-Pacific concept is relatively new for France. Till 2018, France used the “Asia Pacific” concept (Lechervy, 2019). For France, the adoption of this new geopolitical region gives more value to its overseas territories that are in the Western part of the Indo-Pacific (Reunion, Mayotte) and in East Indo-Pacific (New Caledonia, French Polynesia); this makes France a major power in the region. European Union members are also developing security ties with Indo-Pacific nations to favour multilateralism. After signing a strategic pact with India in 2018 that will allow the mutual use of each other’s naval bases, France is considering a trilateral initiative with India and Australia to address security issue in Indo-Pacific (Chaudhury, 2019). Other European naval powers are also increasing their presence in the Indo-Pacific region. This is the case of Germany, which would join some British-French patrols in South China sea. In July 2019, Italy and Vietnam agreed to enhance cooperation in many sectors including security and national defense. However, many other European members especially Central and Eastern European countries do not have enough (or any) naval capacity to be active in Indo-Pacific, and so their policy focuses mainly, if not exclusively, on trade. European initiatives have been considered as some European attempts to contain China’s growing influence in the Indo-Pacific, however they may also serve the European military industry. (iii)

Indo-Pacific Countries as Military Import Markets

Although China is EU’s largest trade partner in the Indo-Pacific region, EU arms exports to China are limited. Since 1989, both the EU and the USA have banned arms exports to China. In 2005, the EU considered lifting this ban, but there was no consensus among EU members. Despite the embargo, some European countries including France, the United Kingdom and Spain have continued to sell non-lethal military equipment to China. The Indo-Pacific region remains the largest military import market (before the Middle East region) and European arms exports to IndoPacific regional powers may partly explain European nations’ policy in the region. According to SIPRI (Wezeman et al., 2019), Indonesia was the UK’s third arms exports market between 2014 and 2018with 11 percent of total UK arms exports going to Indonesia. In the same period, Indonesia and the UK boosted their diplomatic relations. In 2012, Jakarta and London signed a memorandum of understanding on defense cooperation. In June 2019, was holded the UK Indonesia Partnership Forum in London (Parameswaran, 2019). Another example regards the defense cooperation agreement signed between Netherlands and Indonesia in 2014, Indonesia being Netherlands’ 3rd military client for the period between 2014 and 2018.

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The most striking example between EU member’s diplomacy in Indo-Pacific and arms exports may be the one of France and India. In 2016, India agreed to buy 36 Rafale fighter jets to France for e8 billion, this deal has boosted the relations between India and France: the two countries signed a defense partnership agreement in 2018. As a result, European nations’ Indo-Pacific strategy may be partly influenced by their arms sales to regional powers.

Europe: A Reluctant Partner in BRI Europe ought to be one of China’s main partners to realize the Belt and Road Initiative as both the continental and maritime silk roads are to connect the two regions. Furthermore, both China and Europe stand against protectionism in a world where free trade is more and more questioned. Although the EU shares with China the same ambition to promote connectivity, the European Union has not yet officially joined in the Belt and Road Initiative. However, there is a growing debate among EU members to make this move and be part of the BRI. (a)

European Concerns Regarding the BRI

China’s Belt and Road Initiative has been regarded with great interest by the European Union, but this connectivity plan does also worry institutions in Brussels. i.

China’s Growing Influence in Europe

The EU is particularly worried about Chinese growing influence among EU members. Several EU countries among China’s key partners for the BRI realization adopted some pro-Chinese policy that made the EU fail to stand on a united front regarding some diplomatic decisions. Thus, the EU position in July 2016 CPI’s ruling, which we studied earlier, is the result of Hungary and Greece’s decision not to upset China (Fallon, 2016). In June 2017, Greece vetoed EU statement on human rights in China at United Nations (Le Corre, 2018). The construction of new infrastructure financed thanks to Chinese investment may deepen China’s footprint in Eu institutions and decision-making. ii.

The BRI and EU Governance Standards

The European Union also fears that rules adopted by China for the implementations of BRI projects do not match with EU norms. The railroad project connecting Budapest, Hungary to Belgrade, Serbia and financed by China Exim bank has been under European scrutiny, as this project does not fully comply with EU fair competition and public tendering rules (Rogers, 2019). As a result, construction of the railroad has been postponed on the Hungarian side. European institutions and members are also worried about the possible debt issues created by the Belt and Road Initiative. In April 2018, European ambassadors in Beijing released a confidential report about the BRI and warned the EU

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about the financial aspects of the BRI and the preferential treatment given to China’s state-owned companies in the initiative. (Heide et al., 2018). Because of the above concerns, the European Commission (2019) has described China has a “systemic rival promoting alternative models of governance”, following this comment, China foreign Minister Wang Yi stressed the possible cooperation between Europe and China (Peel, 2019a). For China, addressing these issues has become a top priority in order to continue to attract other nations within the BRI. (b)

EU Members’ Position Regarding the BRI

To date (October 2019), a majority of EU member states have endorsed the Belt and Road Initiative by signing a memorandum of understanding (MoU) with China. Central European (Czech Republic, Hungary, Poland, Slovakia) and Balkan countries (Bulgaria, Romania) were among the first states to join the Belt and Road Initiative in 2015. They were followed by Latvia in 2016, Croatia Estonia, Lithuania, Slovenia in 2017. In 2018, South European countries like Greece, Malta and Portugal also choose to be part of the BRI. In 2019, Cyprus and two EU Western European countries (Italy and Luxembourg) made a similar choice. The decision made by Italy was largely covered by media, as Italy was the first G7 country to join China’s BRI, and Rome’s possible alignment with Beijing raised many concerns in Brussels but also in Washington. EU countries that have endorsed China’s BRI do not all share the same motivations. Most Central European and Balkan countries expected to become more attractive to Chinese investors and to upgrade their infrastructure. However, few large investments have been made in these countries except for the Budapest–Belgrade railroad project and some flagship operations; this led to some scepticism in several Central European countries (Pendrakowska, 2018). Mediterranean countries joined the Belt and Road initiative with the ambition to make some of their ports major hubs for the Chinese trade in the Mediterranean and be an alternative to the North seaports of Rotterdam, Antwerp and Hamburg. In 2016, Chinese company COSCO became the main shareholder of the Piraeus Port in Greece. Italy’s Trieste may become another gateway to Europe, and Portugal’s Sines on the Atlantic coast could become another one for the Iberian Peninsula (OBOReurope, 2018). Both Central European and Mediterranean countries are also interested in Chinese participation in former state-owned utility companies such as Portugal’s EDP. Luxembourg and Switzerland (a non-EU member country) are not particularly interested in China financing and developing infrastructure on their territory but want their banks to be involved in the financial aspects of the BRI. A few days after Luxembourg Prime Minister Xavier Bettel signed a MoU on the BRI in April 2019, a Belt and Road bond was issued at Luxembourg Stock Exchanges. For Luxembourg and Switzerland banks, the BRI is an opportunity to expand in emerging markets along the new Silk roads.

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Even in EU countries that are not officially part of the BRI (mostly Western European countries), there is no vigorous opposition to the Belt and Road Initiative. Several European countries signed cooperation agreements with China without formally mentioning the Belt and Road Initiative. During President Macron’s state visit to China in February 2018 was signed an agreement between the French Development Agency and China Development Bank on possible cooperation projects in third countries in Africa. This decision was quite similar to the one biding Italy and China in their MoU on the BRI promoting cooperation in third countries. Paradoxically, EU member countries that have not officially joined the BRI may be considered the most involved in the initiative. The port of Rotterdam in the Netherlands is a major gateway to Europe and the maritime Silk Road; since 2016, China’s COSCO has some stakes in one terminal. Germany, which has still not officially joined the BRI is home of Duisburg the main hub and logistics center for intercontinental freight trains connecting China to Europe. In the United Kingdom, the City is the most advanced Belt and Road financial centre outside China (City of London, 2018), as London was the first non-Chinese financial place to issue RMB bonds in May 2016. European companies are already involved in some Belt and Road projects, and European business associations call their countries to join the BRI. Several European companies like Siemens (Suokas, 2018) have already signed MoUs with Chinese authorities to develop the Belt and Road Initiative. Despite some reservations, most Western European leaders seemed to back China’s BRI. British finance minister Philip Hammond described the Belt and Road as a “extraordinarily ambitious vision” during his official visit to China in April 2019 (Goh, 2019). For Mark Rutte, the Dutch prime minister, the Belt and Road Initiative is an opportunity for Europeans, but BRI projects still need to be more opened to foreign companies. In March 2019, during President Xi Jinping’s state visit in France, Chancellor Merkel who also attended this meeting stated that “they (Europeans) want to play a role in the ‘One Belt, One Road Initiative’”, but European leaders stressed the need for reciprocity in this connectivity project (Chambers, 2019). The EU-Asia Connectivity Plan may be may prompts China address this issue.

The EU-Asia Connectivity Plan: An Alternative or a Complementary Project to the BRI? The European Union has launched its very own strategy regarding development policy in Asia with the “Connecting Europe and Asia –Building blocks for an EU Strategy” document in September 2018 followed by the “EU-Japan partnership on sustainable connectivity” unveiled in September 2019. The latter initiative has been described as a riposte to China’s Belt and Road Initiative (Peel, 2019b).

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Promoting EU Values and Interests

Brussels and Tokyo argued that they would “pay utmost attention to partners’ fiscal capacity and debt-sustainability” and Japanese prime minister, Shinzo Abe presented Japan and the EU as “guardians of universal values” (Wolf, 2019). This may be perceived by China as a direct criticism of its own Belt and Road Initiative, as the BRI has been repeatedly accused of putting fragile countries at financial risks. Brussels and Tokyo also insist on the “transparency” of their practices, and this again may be an implied criticism of the Belt and Road Initiative. Although this joint strategy covers the whole Eurasian continent including the Indo-Pacific, the EU is especially keen on defending its interests in two particular sub-regions which are Eastern Europe and Western Balkans. Since 2012 and the creation 16 + 1 format (now 17 + 1 since Greece has joined the initiative), China has developed strong ties with Central and Eastern European countries, but this initiative has generated concern among EU institutions (Matura, 2019). A highway construction in Montenegro financed through the BRI mechanism has raised questions by EU officials as this project put this 620,000 populated country at financial risk as Montenegro took a e809 million loan from China. With this initiative, the EU is showing its willingness to better preserve its influence in the region. (b)

Competition with China

A direct competition between EU-Japan connectivity project and China’s BRI is not likely to happen as the European-Japanese initiative is much humbler and fragile. The European initiative has fewer resources than China’s, with a possible e60 billion budget compared to BRI’s trillion-dollar estimations. Furthermore, Asian countries are wary of the EU initiative’s development, as no major project has been either analysed or funded since the launch of the EU-Asia connectivity strategy in September 2018; the EU high governance standards do not allow the rapid development of infrastructure projects. The initiative will also largely depend on the good relations between the EU and Japan. But China actually seems to welcome this initiative. The EU-China summit joint statement (2019) mentions both China’s Belt and Road Initiative and EU strategy on Connecting Europe and Asia; in this document, China and the Eu pledge to “forge synergies” between their programs. The EU initiative may actually give more legitimacy to the BRI that has come under criticism (Shah, 2016). By partnering with the EU, China may make the BRI more attractive to other nations, and allay fears about the BRI.

Conclusion For European countries, there is no stark opposition between US’s Indo-Pacific Strategy and the Belt and Road Initiative. The economic and infrastructure dimension of the Indo-Pacific Strategy still remains vague as few projects have been

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financed through this mechanism. For Europeans, the Indo-Pacific Strategy is mostly a defense concept. Although the European Union is willing to work for the IndoPacific stability, it doesn’t possess its own navy forces, so only its most powerful members that can maintain a military presence in the region, that is to say the United Kingdom and France (and to a lesser extent Germany and Italy) have partly endorsed the Indo-Pacific concept. China’s BRI looks much more attractive to European Union members as it appeals to every nation,—even some Caribbean islands have joined the Chinese initiative— (OBOReurope, 2019) and not only to Indo-Pacific countries or European countries that have the military capacity to maintain a military presence in the Indo-Pacific. In spite of US criticisms on the BRI, most Central European countries have joined the Chinese initiative, and Western EU members do not oppose to the BRI, but want the new Silk Roads to be opened to their own companies. European institutions fear the growing influence of China on the European continent through the BRI; this has led the EU to launch its own initiative the Eu Asia connectivity strategy in partnership with Japan. Contrary to US’s Indo-Pacific Strategy, the Eu-Japan partnership on sustainable connectivity is not direct alternative to China’s Belt and Road. This European (and Japanese) initiative might be analysed as an attempt to better protect European interests in the region and to promote a certain expertise regarding international cooperation. However, it is still hard to foresee the development of this new connectivity plan. Europeans will need to convince Indo-Pacific nations of their initiative in a region where China’s influence in growing.

References Chambers. M. (2019, March 26). Europe wants to join China ‘Belt and Road’ plan but needs reciprocity—Merkel. Reuters. Retrieved from https://uk.reuters.com/article/uk-france-chinamerkel/europe-wants-to-join-china-belt-and-road-plan-but-needs-reciprocity-merkel-idUKKC N1R716G Chaudhury, D. R. (2019, August 28). India, Australia & France to jointly create inclusive IndoPacific. The Economic Times. Retrieved from https://economictimes.indiatimes.com/news/def ence/india-australia-france-to-jointly-create-inclusive-indo-pacific/articleshow/70864929.cms City of London & Bank of China. (2018, September). Building an investment and financing system for the Belt and Road Initiative. Retrieved from https://www.cityoflondon.gov.uk/business/asiaprogramme/greater-china/Documents/building-an-investment-and-financing-system-for-the-bri. pdf CSIS. (2016, August 15). Asia maritime transparency initiative. Who is taking sides after the South China Sea ruling? Retrieved from https://amti.csis.org/sides-in-south-china-sea/. European Commission. (2019, March 12). EU-China—A strategic outlook. Strasbourg, France: Author. Retrieved from https://ec.europa.eu/commission/sites/beta-political/files/communica tion-eu-china-a-strategic-outlook.pdf European Council. (2016, July 15). Declaration by the high representative on behalf of the EU on the award rendered in the arbitration between the Republic of the Philippines and the People’s Republic of China. Retrieved from https://web.archive.org/web/20180209060419/https://www. consilium.europa.eu/en/press/press-releases/2016/07/15/south-china-sea-arbitration/

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European External Action Service. (2019, April 10). Joint statement of the 21st EU-China summit. Brussels, Belgium: Author. Retrieved from https://eeas.europa.eu/delegations/china_en/60836/ Joint%20statement%20of%20the%2021st%20EU-China%20summit European Union. (2016, June). Shared vision, common action: A stronger Europe. A global strategy for the European Union’s foreign and security policy. Retrieved from https://eeas.europa.eu/sites/ eeas/files/eugs_review_web_0.pdf Fallon, T. (2016, October 13). The EU, the South China Sea and China’s successful wedge strategy. Center for Strategic & International Studies. Retrieved from https://amti.csis.org/eu-south-chinasea-chinas-successful-wedge-strategy/. Goh, B. (2019, April 26). Britain calls China’s Belt and Road Initiative a ‘vision’. Reuters. Retrieved from https://fr.reuters.com/article/topNews/idUKKCN1S20O5 Heide, D., Hoppe T., Scheuer, S., & Stratmann, K. (2018, April 17). EU ambassadors band together against Silk Road. Handelsblatt Today. Retrieved from https://www.handelsblatt.com/today/pol itics/china-first-eu-ambassadors-band-together-against-silk-road/23581860.html?ticket=ST-343 49459-Uyl9gPMtxC5RcaTvriF1-ap2 IMF. (2018, October). Asia and Pacific Asia at the Forefront: Growth challenges for the next decade and beyond. October. Washington DC, USA: Author. Retrieved from https://www.imf.org/en/Pub lications/REO/APAC/Issues/2018/10/05/areo1012 Kardon, I. (2018). China can say “No”: Analyzing China’s rejection of the South China Sea arbitration. University of Pennsylvania Asian Law Review, 13(2), 1–44. Retrieved from https://schola rship.law.upenn.edu/cgi/viewcontent.cgi?article=1037&context=alr Le Corre, P. (2018, October 30). This is China’s Plan to Dominate Southern Europe. Carnegie Endowment for International Peace. Retrieved from https://carnegieendowment.org/2018/10/30/ this-is-china-s-plan-to-dominate-southern-europe-pub-77621. Lechervy, C. (2019). La France et le concept d’Indo-Pacifique [France and the Indo Pacific concept]. Politique Etrangere, 3, 23–35. Retrieved from http://www.revues.armand-colin.com/eco-sc-pol itique/politique-etrangere/politique-etrangere-ndeg-32019/france-concept-dindo-pacifique Liu, N. (2018, January 15). The European Union, a different power in the South China Sea? Australian Institute of International Affairs. Retrieved from http://www.internationalaffairs.org. au/australianoutlook/europe-china-sea/ Matura, T. (2019). China–CEE trade, investment and politics. Europe-Asia Studies, 71(3), 388–407. https://doi.org/10.1080/09668136.2019.1571166 OBOReurope (2019, May 8). The Caribbean and the BRI. Retrieved from https://www.oboreurope. com/en/caribbean-bri/ OBOReurope (2018, December 10). Portugal, the Atlantic coast of the Belt and Road initiative. Retrieved from https://www.oboreurope.com/en/portugal-atlantic-bri/ Parameswaran, P. (2019, October 1). UK-Indonesia Military Ties in the Headlines with Minister of State Visit. The Diplomat. Retrieved from https://thediplomat.com/2019/10/uk-indonesia-mil itary-ties-in-the-headlines-with-minister-of-state-visit/ Peel, M. (2019a, March 18). China hits back at Brussels over ‘Systemic Rival’ warning. Financial Times. Retrieved from https://www.ft.com/content/471a49f6-497a-11e9-bbc9-6917dce3dc62 Peel, M. (2019b, September 29). Japan and EU sign deal in riposte to China’s Belt and Road. Financial Times. Retrieved from https://www.ft.com/content/dd14ce1e-e11d-11e9-9743-db5a37 0481bc Pendrakowska, P. (2018). Poland’s perspective on the Belt and Road Initiative. Journal of Contemporary East Asia Studies, 7(2), 190–206. https://doi.org/10.1080/24761028.2018.155 2491 Rogers, S. (2019). China, Hungary, and the Belgrade-Budapest Railway Upgrade: New politicallyinduced dimensions of FDI and the trajectory of Hungarian economic development. Journal of East-West Business, 25(1), 84–106. https://doi.org/10.1080/10669868.2018.1561589 Shah, A. (2016). Building a sustainable ‘Belt and Road’. Horizons, 7. Retrieved from https://www. cirsd.org/files/000/000/001/34/2cfc3d25258c340f9952807ed56f676c601716b3.pdf

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Suokas, J. (2018, June 6). Germany’s Siemens signs Belt and Road deals with Chinese firms. Global Times. Retrieved from https://gbtimes.com/germanys-siemens-sets-up-belt-and-road-off ice-in-beijing The White House. (2018, October 4). Remarks by Vice President Pence on the Administration’s policy toward China. Washington DC, USA: Author. Retrieved from https://www.whitehouse. gov/briefings-statements/remarks-vice-president-pence-administrations-policy-toward-china/ US Department of Defense. (2019, June 1). Indo Pacific strategy report: Preparedness, partnerships and promoting a networked region. Department of Defense. Washington DC, USA: Author. Retrieved from https://media.defense.gov/2019/Jul/01/2002152311/-1/-1/1/DEPART MENT-OF-DEFENSE-INDO-PACIFIC-STRATEGY-REPORT-2019.PDF Wezeman, P., Fleurant, A., Kuimova, A., Tian, N., & Wezelan, S. (2019, March). SIPRI fact sheet: Trends in international arms transfers, 2018. Stockholm, Sweden: SIPRI. Retrieved from https:// www.sipri.org/sites/default/files/2019-03/fs_1903_at_2018.pdf Wolf, S. (2019, September 30). On the Asian Century, Pax Sinica& Beyond (VI)— The New EU-Japan Connectivity Partnership: Building a sustainable, liberal, rule based alternative to the BRI. South Asia Democratic Forum comment 153. Retrieved from https://www.sadf.eu/comment-153-on-the-asian-century-pax-sinica-beyhond-the-new-eujapan-connectivity-partnership-building-a-sustainable-liberal-rule-based-alternative-to-the-bri/

Dr. Sebastien Goulard is the manager of Cooperans, a public affairs and project management consultancy specialized in EU-Asia connectivity projects. Dr. Goulard is also the coordinator of the OBOReurope platform which aims to promote the new silk routes in Europe. During his doctoral studies at EHESS (School for Advanced Studies in the Social Sciences), Paris, Dr. Goulard participated in several European research programs dealing with sustainable urbanization in China. Dr. Goulard holds a BA (hons) degree in international politics (ESE, Nottingham Trent University), a MA degree in international relations (IRIS, France) and a MA degree in social sciences (EHESS). Dr. Goulard regularly contributes articles in several French and international journals.

Chapter 7

Opportunities for New Trend of Labour Mobility from Vietnam as a Result of Doi Moi, ASEAN Connectivity and Belt and Road Initiative Mukda Pratheepwatanawong Abstract With reference to the doi moi policy in Vietnam, Master Plan on ASEAN Connectivity (MPAC) 2025 and the Belt and Road Initiative or BRI, this chapter raises the question of “How labour mobility policies should be developed in order to increase the opportunities for labour mobility from Vietnam through regional integration?” This chapter is a review article that sets out to identify the patterns and opportunities of labour mobility in Vietnam nationally, regionally and crosscontinentally. Attention will be given to the question of how far MPAC 2025 and BRI might enhance opportunities to manage Vietnamese labour mobility in the region in such a way as to improve Vietnam’s standing to that of an upper-income country. Light will be thrown on the question of how far such opportunities of Vietnamese labour mobility have been exploited through educational policy, notably with reference to the changes in management of vocational training institutions. This chapter argues that the success of implementing doi moi policies has reformed Vietnam’s economy and promotes Vietnamese associations within and outside Southeast Asia and Vietnam should work to enhance its labour mobility policies and agreements with labourreceiving countries with an objective of providing more opportunities for formal labour mobility to occur through Vietnam’s involvement in connectivity projects, which could be done through the structural changes and developments of syllabi in vocational training to improve and complement with the new skills required for students to work locally and within the region.

Introduction The success of the doi moi policy implementation in the year 1986 had a significant impact on the socioeconomic structure in Vietnam. Being a “market economy with socialist orientation” enables Vietnam to increase the openness of its economy, liberalize its economy through the reform of the different business sectors in the M. Pratheepwatanawong (B) Center of Excellence for Mekong Studies, Institute of Asian Studies, Chulalongkorn University, Bangkok, Thailand e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_7

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country. This helped to increase economic growth, reduce poverty, diversify human resource management, and to mobilize its labour force domestically and regionally. However, as a labour surplus country with strong economic growth and growth in foreign direct investment, regional integration and connectivity are also important elements to contribute to Vietnam’s economic growth and labour mobility, which leads to the question to what extent Vietnam has been able to take advantage of opportunities in regional integration? Doi moi or “renovation” was strongly associated with the policy changes to increase the openness of Vietnam economy (Gainsborough, 2010, pp. 1–2). According to Ashwill and Diep (2005), prior to the reform the State-owned the major means of production, made decisions on the allocation of resources, determined production quotas and set prices. As real GDP growth slowed down in 1978, the country faced hyperinflation, food shortage and a major fall in agricultural production and industrial production (pp. 55–58). Against this backdrop of economic deterioration and social problems, doi moi policies were implemented with the intention to develop the private sector, increase and stabilize agricultural output, shift the focus of investment from heavy industry to light industry, reduce the role of state enterprises, focus on export-led growth and attract foreign direct investment, which were all expected to develop the country’s economy (Ashwill & Diep, 2005, pp. 55–58). Moreover, the Vietnam’s economy aimed to be diversified and become a “multisector economy” (Sakata, 2013, p. 6), allowing various forms of capital ownership and increasing the importance of private sector entities and foreign investors in the country, with the Vietnamese government issuing new laws and legal ordinances imposed. The reform of the State-Owned Enterprises (SOEs) to enhance their international competitiveness has also been contributing significantly to the economic reform in Vietnam (Sakata, 2013, p. 7) as SOEs have been equitized (Pincus, 2016) and such reform also addressed the unemployment problem as the reform aimed to sustain wages and prevent job losses (Clarke, 2004, p. 104). The labour market in Vietnam is flexible and does not have a clear trend as it is possible for workers to change in the type, sector and category of their employment (Brand-Weiner et al., 2015, p. 30). The interprovincial migration to resettle people still occurs in some provinces due to the national construction of projects such as hydroelectric power plants, the migration flow in Vietnam after 1986 was the result of restructuring of the economy and the associated emergence of individual businesses, foreign investment and industrial zones. Also, the lack of jobs in rural areas has motivated Vietnamese people to migrate to urban areas, establishing the trend for rural-to-urban flows (Anh et al., 2012, p. 7). However, such flows of labour impacted upon the supply of infrastructure and other basic services in urban areas. In the 1990s, the Vietnamese government introduced policies to regulate labour export in order to resolve the long-term unemployment issue and increase income for Vietnamese. This motivated both high-skilled and low-skilled labour to go overseas to work. A total of 120,000 Vietnamese workers went abroad during the 1990s (Tullao & Cortez, 2006). Both the public and private sectors in Vietnam have been trying to provide support and services for the workers to be employed. For example, the Vietnamese government has policies to promote outflow of labour. According

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to Huy (2008), policies have been revised in recent year and “the July 2007 Law on Overseas Vietnamese Labour and Implementation decrees aims at a fuller and more comprehensive legal environment for labour exports and to cover areas such as procedural implications, fees and funding, pre-departure training, settlement of administrative violations of labour export businesses” (cited in Yue, 2014, pp. 112– 113). Furthermore, the majority of provincial governments in Vietnam had established labour exports steering committees, having different policies and different solutions to increase provincial labour export activities. The cooperation between local governments and labour export enterprises had been better in the year 2007, which were beneficial to workers (Huy, 2008, cited in Yue, 2014, pp. 112–113). Vietnamese workers are also supported by the government when they return to Vietnam to resettle again. According to Tullao and Cortez (2006), low-skilled and low-paid Vietnamese migrants workers receive inadequate training and have limited language skills and they tend to face discrimination in pay and work, often in conditions where legal protection is lacking and sometimes experiencing harassment. The Vietnamese embassies in different countries work to protect the welfare of Vietnamese temporary labour migrants and there is a policy proposed in the National Assembly to have stricter monitoring on labour agencies and the procedures for sending workers abroad and when they plan to return to Vietnam. For workers who do not finish their contract while working abroad and for returning workers who were not successful working abroad, they are given financial support to do business when they return home. With the collaboration of local governments and NGOs, returning workers can receive vocational training, farmland, or capital for micro-credit loans (Tullao & Cortez, 2006). In terms of Vietnam and its external relation, Vietnam started to have a concrete legal framework regulating economic entities and began to develop as Vietnam started to associate with international relations and external economic relations during 1990s. In 1995, Vietnam became a full member of the Association of Southeast Asia Nation (ASEAN), which enabled the country to become part of the ASEAN Free Trade Area (AFTA), symbolizing a new foreign policy (Sakata, 2013, p. 6). During the same year, Vietnam applied for membership of the World Trade Organisation (WTO). Three years later, Vietnam joined the Asia–Pacific Economic Cooperation (APEC) and in 2000, Vietnam signed a Bilateral Trade Agreement (BTA) with the United States of America. After a long negotiation process, WTO membership was finally achieved in January 2007 (Sakata, 2013, p. 6). With reference to the Master Plan on ASEAN Connectivity, 2025, the Master Plan aims to support the achievement of economic, political-security, and socio-cultural pillars of an integrated ASEAN Community through the collaboration of different countries in the region in order to enhance connectivity within the region (Master Plan on ASEAN Connectivity, 2025, n.d.) With regards to the specific relationship between Vietnam and China, it could be said that Vietnam and China are still dependent on each other for infrastructure investment, although the bilateral relationship between both countries is still questionable and it is interesting to analyse the extent to which both countries are strategic partner or competitor in trade. One Belt, One Road Initiative or BRI proposed by

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China’s President Xi Jinping in 2013 aims to promote “regional and cross-continental connectivity” between China and Eurasia (Zhang, 2016). Therefore, having an identical objective to integrate different countries together through infrastructure chains, BRI is an enormous connectivity project that has China as the hub for the different routes, while the Master Plan of ASEAN Connectivity constitutes different projects that members of ASEAN have a common interest in, aiming to achieve more effective regional cooperation. The significance of doi moi policy, MPAC 2025 and BRI in terms of their impact on Vietnam’s relations with other countries draws attention to the question of “How labour mobility policies should be developed in order to increase the opportunities for labour mobility from Vietnam through regional integration?” This chapter is a review article that sets out to identify the patterns and opportunities of labour mobility in Vietnam nationally, regionally and cross-continentally. Attention will be given to the question of how far MPAC 2025 and BRI might enhance opportunities to manage Vietnamese labour mobility in the region in such a way as to improve Vietnam’s standing to that of an upper-income country. This chapter will approach these issues as follows. Firstly, it reviews the opportunities afforded to labour mobility by the regional integration propounded by the ASEAN Connectivity Master Plan 2025. This is followed by an analysis of the future of labour mobility opportunities in light of the progress of the One Belt, One Road Initiative. Light will be thrown on the question of how far such opportunities of Vietnamese labour mobility have been challenged through educational policy, notably with reference to the changes in management of vocational training institutions. With reference to doi moi policy, MPAC 2025 and BRI, this chapter argues that the success of implementing doi moi policies has reformed Vietnam’s economy and promotes Vietnamese associations within and outside Southeast Asia. Vietnam should work to enhance its labour mobility policies and agreements with labour-receiving countries with an objective of providing more opportunities for formal labour mobility to occur through Vietnam’s involvement in connectivity projects. The structural changes and developments of syllabi in vocational training have been improving to complement with the new skills required for students to work locally and within the region. This shows the potential for Vietnamese vocational training to make a contribution to the expansion of Vietnamese labour migration in response to the opportunities opened up by initiatives such as MPAC 2025 and BRI.

ASEAN Connectivity and Limitations in Labour Mobility ASEAN is perceived as “an institutionalised framework of inter-governmental cooperation” (Dosch & Tuan, 2004, p. 204) that connects countries in the Southeast Asian region together as planned on the Master Plan of ASEAN Connectivity 2025, constituting of physical connectivity, institutional connectivity and people-to-people connectivity. Rodolfo C. Severino, Head of ASEAN Studies Center, Institute of Southeast Asian Studies, who was also the Secretary-General of ASEAN from the

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year 1998 to 2000, explains that the notion of “ASEAN Connectivity” strategized in three interdependent dimensions that aim for countries in the Southeast Asia region to have closer political cohesion, deeper economic integration, and more effective regional cooperation (cited in Das, 2013, pp. xiii–xiv). According to Severino (2013) and Das (2013), physical connectivity refers to the infrastructure required to connect the ASEAN countries together in the form of transportation, information and communication technology and energy, e.g. MelakaPekan Baru Interconnection (IMT-GT: Indonesia). Institutional connectivity constitutes “the measures agreed upon and implemented by governments to facilitate trade and investment within the region” (p. xiii), e.g. operationalization of the ASEAN Agreements on transport facilitation, while people-to-people connectivity is the “personal exchange through education, culture and tourism” (p. xiii), e.g. easing visa requirements for ASEAN nationals. The vision is to make ASEAN countries seamlessly and comprehensively connected and integrated, aiming to promote competitiveness, inclusiveness, and a greater sense of Community. The MPAC 2025 focuses on strategic areas to achieve this vision, which includes sustainable infrastructure, digital innovation, seamless logistics, regulatory excellence and people mobility (Master Plan on ASEAN Connectivity, 2025, n.d, pp. 8–11). With reference to Huelser and Heal (2014), labour mobility in the ASEAN Economic Community as a whole has been occurring as there have been millions of workers working in other member states both legally and illegally. There has been progress on major commitments made to facilitate visas and employment passes with restrictions and laws enforced that vary from country to country. The liberalization of markets and the growing flexibility of labour markets have been enhanced by the signing and exchange of Memoranda of Understanding (MOU) between the labour-sending and labour-receiving countries (Kaur, 2010, p. 387). This is a way of promoting and organizing labour migration through government agreements, with labour-receiving countries negotiating and implementing transnational labour movements and imposing oversight of the operation of private recruitment agencies. According to Hugo (2009, p. 42), International Labour Organisation and UN Conventions on migrant workers suggest that bilateral agreements and/or Memorandums of Understanding between origin and destination countries are an effective way to formalize and regulate the rights and obligations of employers, migrant workers and other stakeholders involved in labour migration. The widely known Mutual Recognition Agreements (MRAs) has been negotiated to recognize the national qualifications of skilled workers such as accountants, engineers and nurses so that they can go to work in other ASEAN States (Huelser & Heal, 2014, pp. 6–7). However, negotiations of MRAs can be complicated due to the wide variations in educational standards in the different countries in ASEAN, which means that countries face difficulties when determining the equivalence of education, training or experience that potential employees have (Huelser & Heal, 2014, pp. 6–7). The recognition of these groups of skilled workers should lead to more flexibility for them to move to another country in ASEAN to work, provided there is a demand for their occupation at the time that they are searching for jobs.

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Whilst MRAs can facilitate and promote movement of professionals in specific fields, there is still a lack of formal agreements to arrange or facilitate low-skilled labour migrants in ASEAN (Vineles, 2018). As a result, problems pertaining to informal labour migration have occurred. For example, unskilled migrant workers endeavour to avoid procedural processes and costs when they migrate to other ASEAN countries to work. Thus, MRAs has limitations in that they support only specific groups of professionals, whilst low-skilled labourers do not benefit from MRAs and are challenged by procedural processes and costs to work in other countries in the ASEAN region. As a result, such agreement establishes a pattern of labour mobility for workers in the region to work towards the requirements needed to work in another country in the region, but there is limited support given to low-skilled labour to migrant in the region. In the research that Harkins et al. (2017) conducted on labour migration in Southeast Asia, they found that the Vietnamese migrant workers paid the most in migration costs (USD 709). They had to borrow the largest amounts (USD 1,044) to pay for the migration costs and spent the longest time to pay back the money that they borrowed (11 months) (Harkins et al., 2017, p. 18). While the average cost for migrating within the ASEAN region is about USD 430 (1.6 months of workers’ wages), this figure is also dependent on variations of expense among the different migration corridors (Harkins et al., 2017, p. xvi). Despite the cost of labour migration in ASEAN, Vineles (2018) proposes that greater labour mobility in ASEAN brings positive impacts to economic integration, which can also eradicate the problems of labour shortages, poverty and unemployment. For example, there are better employment opportunities in ASEAN countries such as Malaysia, Singapore and Thailand. The average monthly wage in Malaysia in 2013 was three times that of Indonesia, the Philippines and Vietnam (Vineles, 2018). Furthermore, labour migration could be viewed as a solution for a country that has a labour surplus and for individuals living at poverty levels. According to Harkins et al. (2017), labour migration had led to the reduction of poverty in Vietnam by 17 percent, suggesting that labour migration has significant potential to contribute to poverty alleviation in countries of origin (p. xx). With further reference to Anh’s (2006) work on “Enhancing the development impact on migrant remittances and diaspora: The case of Vietnam”, there is a significant contribution that migrant remittances had on improving migrant’s family income, living standard improvement on migrant’s family and economic development of Vietnam, especially during the crises in 1970s and the 1980s to the new stage of development in the late 1990s (p. 115). The average remittances sent by one overseas Vietnamese is about USD 1,000 per year in the year 2001 (p. 114). Thus, it could be said that the increased income for individuals or for their country of origin can enhance circulation of money in the country. Labour migration allows labour migrants to move to another country to be employed and earn an income. If they move to a more developed country than their own country, they are likely to earn a higher income than is available in their country of origin. Depending on their management of income and spending, migrant workers can save and send their saving back to their family members, who are living in their country of origin.

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Bhattacharyay (2010, p. 310) proposes that enhancing connectivity helps to increase the standard of living as it can reduce poverty. By providing connectivity to “isolated places” to other economic areas, connectivity can deepen economic integration in the region which can lead to the basis for the “ASEAN common market” (Bhattacharyay, 2010). The development of infrastructures across many countries can positively impact economic development. According to Dosenrode (2015), regional integration takes place within an economic and a political sphere and “globalisation has played an important role in promoting regionalisation” (p. 5). In the case of ASEAN, the association is an inter-governmental organization where the national sovereignty is paramount rather than a supernational organization like the European Union where national sovereignty can be subordinate to the authority of the organization (pp. 2–5). With more than 300 million people constituting the ASEAN workforce, the ASEAN Economic Community (AEC) provides opportunities to strengthen labour migration and human resource development in the region (Capannelli, 2014). The establishment and development of the ASEAN University Network (AUN) programme as part of ASEAN regional cooperation in higher education is an example that aims to strengthen the existing network of cooperation among universities in ASEAN by promoting collaborative studies and research programmes on the priority areas identified by ASEAN, which is a way to sustain ASEAN and regional cooperation (Akhir & Akhir, 2014). In short, in order to move Vietnam to the range of upper-income country, economic reform is not sufficient, but the Vietnamese government should consider working towards more MOU, enforcement of laws, and implementation of policies to support and subsidize labour mobility as part of regional integration. Although ASEAN had provided labour mobility in specific professional fields, there are still limitations hindering the mobilization of low-skilled workforce as migrant labour. Many lowskilled workers are still living in poverty, and governments could relieve such poverty by facilitating low-skilled workers to migrate to another country to work. The fees imposed on labour migration in the ASEAN region is a cost that can disincentivize them. Incomes in receiving countries have to be sufficient to make it worthwhile for workers to migrate.

Belt and Road Initiative (BRI) Belt and Road Initiative or BRI is an initiative, proposed by China’s President Xi Jinping in 2013. BRI aims to promote “regional and cross-continental connectivity” between China and Eurasia (Zhang, 2016), constituting of two elements: “One Belt” refers to the “Silk Road Economic Belt” which aims to develop logistics chains through connecting land routes and economic corridors between different countries together. On the other hand, “One Road” denotes the “Maritime Silk road” which is the sea route of the initiative that aims to boost integration and connectivity between China and other countries. The initiative aims to enhance economic integration in five major areas of interest: policy coordination, infrastructure construction (including

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railways and highways), unimpeded trade, financial integration and people-to-people ties, with the infrastructural construction constituting the dominant feature of the New Silk Road (Zhang, 2016). The completion and success of BRI will enable China to better engage with other countries that are part of the BRI as the seamless connectivity of the logistical chain is expected to lead to sustainable economic development through policy coordination and trade agreements. Having an identical objective to integrate different countries together through infrastructure chains, BRI is an enormous connectivity project that has China as the hub for the different routes, while the Master Plan of ASEAN Connectivity constitutes different projects that members of ASEAN have a common interest in, aiming to achieve more effective regional cooperation. One of the plans in the Master Plan of ASEAN Connectivity is the Singapore-Kunming Rail Link, as it is now included in the BRI, there seems to be a greater chance for it to be completed (Jetin, 2017, p. 12). Thus, the Master Plan of ASEAN Connectivity is also linked to the BRI as BRI attempt to take up this provide to facilitate trade and business opportunities between China and other countries in Southeast Asian region. In other words, connectivity within the ASEAN region or under the BRI is significant to connect different countries together and to seek for cooperation to achieve regional integration through economic development and political cohesion. However, unlike the MRAs to facilitate specific professional mobility in ASEAN, there is still no definite strategic plan or policies based on how BRI would support labour mobility. With regard to the Vietnamese government’s response to BRI, it could be said that Vietnam and China are still dependent on each other for infrastructure investment, although the bilateral relationship between both countries is still questionable concerning the South China Sea disputes issues (Hiep, 2018, p. 4), which are complex and have been a persistent risk to the two country’s stable relationship (Hiep, 2017, p. 5). Vietnam is a country that always seeks infrastructure investment and development and this will enable BRI to facilitate trade, leading to economic growth and foreign direct investment. The two countries had signed a MOU in November 2017, which focused on promoting the connection between the “Two Corridors, One Belt” (TCOB) framework and the BRI (Hiep, 2018, p. 3). According to Hiep (2016), Vietnam wants to maintain “a stable and peaceful relationship” with China (p. 373). Both countries agreed to develop tourism in Ban Gioc waterfall which is on a shared land border, and also to study the feasibility of a railway project connecting Lao Cai-Hanoi–Hai Phong in northern Vietnam, which could be aligned with China’s “One Belt, One Road” Initiative. China has also been generous in providing Vietnam with a USD 300 million concessional loan for the construction of the Mong Cai—Van Don highway, and an additional USD 250 million preferential loan for the Cat Linh—Ha Dong urban railway project (Vietnam Investment Review, 9 November 2015, cited in Hiep, 2016, p. 373). Moreover, China promised to provide 1 billion yuan in aid for Vietnam over five years to build schools and hospitals, which is the biggest grant that China has given Vietnam in decades (Hiep, 2016, p. 373). In short, as One Belt, One Road Initiative is a regional and cross-continental connectivity project, Vietnam’s involvement in the project and its development of

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bilateral relationship with China will open up more economic integration through policy coordination, infrastructure construction, unimpeded trade, financial integration and people-to-people mobility, which will be an indirect way to counteract the complicated South China Sea disputes that destabilize the two country’s relationship. As a result, through policy coordination and agreements to facilitate labour mobility, the completion of the One Belt, One Road Initiative will enable Vietnam to send its workforce to countries in other continents. Such employment opportunities will enhance individual incomes and help to alleviate Vietnam’s level of poverty. However, Vietnam needs to work to identify the destination countries for its workforce based on the skills required to work there. The government can then work to enhance those skills through vocational training centers in Vietnam.

Vocational Training in Vietnam Vocational education and training in Vietnam is managed by the Ministry of Labour, Invalids and Social Affairs (MOLISA). MOLISA is a Vietnamese government agency that is responsible for labour issues including job creation, training, labour management relations, wages, social insurance, occupational safety and hygiene (Tullao & Cortez, 2006). As for the vocational education and training in Vietnam, the MOLISA is responsible for developing strategies and implementing the strategies, managing the technical vocational education training institutes and in charge of the policies concerning vocational elementary level (according to the report prepared by National Institute for Vocational Training, 2017). Previously, Ashwill and Diep (2005) argued that Vietnam’s higher education system was unable to meet current and projected labour demand, resulting in graduates being underemployed due to the gap between the vocational skills needed by the economy and the skills taught by higher education institutions. In addition, vocational training in Vietnam was very weak in quality and most of the students did not want to go to vocational institutions if they failed the university entrance exam. The Ministry of Education and Training (MOET) did not sufficiently convince young people that Vietnam now needs more skilled workers (pp. 65–66). In other words, the students were not motivated to do vocational training in Vietnam. According to Huy (2008), a significant number of vocational training centers lacked understanding of job requirements in international markets and lacked the ability to train students for highly skilled jobs. As a result, Vietnam’s exported workforce does not meet the newly required labour skills, e.g. nursery and midwifery in Japan or husbandry in Korea (pp. 12–13). Huy recommends that in order to overcome this shortcoming in the Vietnamese labour market and to achieve social and economic targets, it is necessary to increase the quality of vocational training in Vietnam. This can be done by providing financial support and investment in human resources to develop vocationally relevant training programmes and also to seek cooperation with businesses to help students get access to higher quality of training, internship and

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jobs. Vineles (2018) proposes that sending countries should know about the employment opportunities in the region in order for them to determine and prepare the skills and training required for labour migration based on the employment opportunities or job specifications. This means that the government in each country or the training institutions can work to define the employment opportunities and develop the specific skills that workers need for the fields that they intend to work in. According to the report on “ASEAN State of Education Report 2013” prepared by The ASEAN Secretariat (2014), there are three levels of vocational training in Vietnam: a basic level, an intermediate level and a college level. Students take three months to one year to complete the basic level of vocational training which is made available through vocational training centres, vocational secondary schools, vocational colleges, professional intermediate schools, etc. As for the admission to the intermediate level of vocational training, it is restricted to students who have completed either a lower secondary school diploma lasting 3 or 4 years or an upper secondary school diploma, lasting only 1–2 years. With a few informal talks with students in vocational education in Ho Chi Minh City in October 2017, it could be said that because vocational education in Vietnam used to be critically perceived as failing to meet the country’s economic needs, the Vietnamese government has been attempting to increase the quality of vocational education. Thus, the transfer of the remit for vocational training from MOET to MOLISA was undertaken with the intention of achieving more efficient management in vocational colleges and to improve the teaching syllabus in vocational education, ensuring that it is relevant to students’ skills development and future employment. This is also to make sure that what vocational college students learn while studying is relevant to workplace needs. The strategies for skills development were also aimed to improve the intellectual and professional skills of vocational college students, in line with their field of study at vocational college. Interestingly, the syllabus at vocational college has been restructured to provide students with options on whether to further pursue their study at university or to start working after graduating from vocational college. This means that the students do not necessarily have to work using their vocational skills, but would have more options to proceed with their study if they wanted to go into higher education. Studying in higher education and university can develop students’ intellectual skills and increase their relevant knowledge and skills in their field of study. In universities where the curriculum gives importance to active learning or innovative learning, students have the opportunity to become more critical and active, with these skills they can use in their future workplaces. Thus, further pursuit of their studies at university could provide better preparation for students to work after graduating from university. Also, language diversity in ASEAN is a challenge for labour migration regardless of English not being the official language of communication in ASEAN communication (Tullao & Cortez, 2006). Although English is a common language in many countries, languages such as Japanese and Korean are also taught in vocational college in Vietnam, which is important for students who have the intention to move to these countries to work and will have to use these languages for their work. As for students who intend to stay in Ho Chi Minh City or Vietnam to work in an international

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environment where they have to associate with foreigners, English is important for them to communicate in the workplace. Vocational colleges in Vietnam also try to develop local and international contacts with companies in order to increase the professional relevance of teaching syllabi so that graduates will have the skills required by potential employers, thus enhancing their competitiveness in the labour force. In the report “Viet Nam Vocational Education and Training Report 2015” (published by National Institute for Vocational Training, 2017), the strategy for Vocational Training Development for 2011–2020 had proposed the solutions for connecting vocational training with the labour market and promoting active participation of enterprises in vocational education training activities. The vocational training institutes were able to define the differences between the level of occupational theoretical knowledge, competences of graduates, occupational skills and the working attitudes that graduates have in comparison to what the enterprises require, which what graduates have lower competencies than what the enterprise required. Thus, such improvement of relationships is fundamental to ensure that what students learn at vocational college will be relevant to their future workplace. In other words, this is to ensure that students at vocational college will have more relevant skills for employment, which will increase their chances of finding employment. Moreover, the improvement and raised in quality of vocational education and training in Vietnam was also reported in the report “Viet Nam Vocational Education and Training Report 2015” (published by National Institute for Vocational Training, 2017), whereby vocational education and training in Vietnam experienced a significant change in the year 2015 due to the implementation of Law on Vocational Education and Training in Vietnam. There has been a new law on Vocational Education and Training, came into effect in 2015 to develop a network in the technical vocational education and training institutes, which offers more variety of learning opportunities for people. Moreover, the quality assurance condition in vocational education and training in Vietnam has been improved, which also raised the occupational skills of technical vocational education and training graduates. Such significant change and effect shows the fundamental development in human resource in Vietnam and the priority that the government had given to improving the Vietnamese workforce. In sum, the Vietnamese government has started to work to increase the quality of vocational training in Vietnam to meet international standards, concentrating foreign assistance on developing high-quality vocational training (according to “ASEAN State of Education Report 2013”, prepared by The ASEAN Secretaria, 2014). The constant changes and rapid development of strategy and implementation of policy to raise the quality of vocational training in Vietnam all imply that there is potential for Vietnam to move from being a low-skilled workforce country to a high skilled workforce country that is responsive to international labour demands. With the enhancement of connectivity through ASEAN and the One Belt, One Road Initiative, the Vietnamese government can work with countries involved in these projects to proactively adjust to labour market demands in such a way as to enhance Vietnamese labour migration. With the relevant skills that students received from vocational training,

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there will be more possibility for them to be employed after their completion of study, which should reduce unemployment.

Conclusion Based on the question that was raised at the beginning of the chapter: “How should labour mobility policies be developed in order to increase the opportunities for labour mobility from Vietnam through regional integration?”, it could be said that Vietnamese labour mobility policies in the context of regional integration should be developed to facilitate the easy movement of labour to another country based on the agreements or MOU that the Vietnamese government has with another country. This involves supporting workers through appropriate training and financial assistance to promote the competitiveness of Vietnamese labour. Although the government has been proactive in providing incentives to support labour mobility, its facilitation of labour mobility from Vietnam can still be improved. The government should consider providing more support to labour mobility in the low-skills sectors. There are still limited incentives to support labour mobility under the One Belt, One Road Initiative and it seems challenging to reach an agreement on one due to the different demands that each country might have. However, BRI could usefully supplement the MPAC 2025. Whilst the latter has provided a basis for enhanced regional integration, it has not been able to greatly enhance labour mobilization. BRI could pick up this objective by providing assistance to enhance both highskilled and low-skilled labour mobility. The completion of BRI will potentially enable Vietnam to mobilize its labour workforce cross-continentally through effective policy coordination to sustain labour mobility, income generation, poverty reduction and economic growth. Thus, the Vietnamese successes in vocational education together with the opportunities for connectivity offered by BRI and MPAC 2025 are suggestive that the region might benefit from establishment of an education network that could build on the successes in Vietnam by giving vocational students the opportunity to study in other ASEAN countries. This will enable students to directly receive the skills required for their employment and to develop the cultural understanding needed to work with the local people. In conclusion, this chapter argues that the success of implementing doi moi policies has reformed Vietnam’s economy and initiated Vietnam’s association within and outside Southeast Asia region. BRI and MPAC 2025 provide a viable context within which Vietnam should work to expand labour mobility policies and agreements with labour-receiving countries to provide more opportunities for formal labour mobility to occur through Vietnam’s involvement in connectivity projects. The structural changes and development of new syllabi in vocational training have been improving to complement and enhance the new skills required for students to work locally and within the region. This shows the emergence of new patterns of labour mobility and the potential trend for vocational training students in Vietnam to work in ASEAN countries and countries on the BRI. This in turn reflects the positive role played by

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vocational training in preparing Vietnam to grasp the opportunity to expand its labour migration.

References Akhir, A. M., & Akhir, M. N. M. (2014). Sustaining ASEAN through enhancing regional cooperation in higher education. Yogyakarta: ASEAN Studies Center, Universitas Gadjah Mada. Anh, D. N. (2006). Enhancing the development impact of migrant remittances and diaspora: The case of Vietnam. Asia-Pacific Population Journal, 20(3), 111–122. Anh, L. T. K., Vu, L. H., Bonfoh, B., & Schelling, E. (2012). An analysis of interprovincial migration in Vietnam from 1989 to 2009. Global Health Action, 5(10), 1–12. Ashwill, M. A., & Diep, T. N. (2005). Vietnam today: A guide to a nation at a crossroads. Intercultural Press, Inc. A Nicholas Breakley Publishing Company. Bhattacharyay, B. N. (2010). Institution for Asian connectivity. Journal of International Commerce, Economics and Policy, 1(2), 309–335. Brand-Weiner, I., Francavilla, F., & Olivari, M. (2015). Globalisation in Viet Nam: An opportunity for social mobility. Asia & the Pacific Policy Studies, 2(1), 21–33. Capannelli, G. (2014). ASEAN labouring under outdated migration policies. Retrieved August 1, 2018, from www.eastasiaforum.org Clarke, G. (2004). The social challenges of reform: Restructuring state-owned enterprises in Vietnam. In D. McCargo (Ed.), Rethinking Southeast Asia: Rethinking Vietnam (pp. 91–109). Routledge Curzorn. Das, S. B. (2013). Understanding the MPAC. In S. B. Das (Ed.), Enhancing ASEAN’S connectivity (pp. 3–8). ISEAS Publishing. Dosch, J., & Tuan, T. M. (2004). Recent changes in Vietnam’s foreign policy: Implications for Vietnam-ASEAN relations. In D. McCargo (Ed.), Rethinking Southeast Asia: Rethinking Vietnam (pp. 197–213). Routledge Curzorn. Dosenrode, S. (2015). On regional integration. In S. Dosenrode (Ed.), Limits to regional integration (pp. 1–16). Routledge. Gainsborough, M. (2010). Vietnam: Rethinking the state. Zed Books Ltd. Harkins, B., Lindgren, D., & Suravoranon, T. (2017). Risks and rewards: Outcomes of labour migration in South-East Asia. International Labour Organization and International Organization for Migration. Hiep, L. H. (2016). Vietnam in 2015: Challenges persist amidst, hope for change. In M. Cook & D. Singh (Eds.), Southeast Asian affairs 2016 (pp. 363–378). ISEAS Publishing. Hiep, L. H. (2017). Living next to the giant: The political economy of Vietnam’s relationship with China under Doi Moi. ISEAS Publishing. Hiep, L. H. (2018). The belt and road initiative in Vietnam: Challenges and prospects. ISEAS Perspective Huelser, S., & Heal, A. (2014). Moving freely? Labour mobility in ASEAN. Asia-Pacific Research and Training Network on Trade Policy Brief No. 40 Hugo, G. (2009). Best practice in temporary labour migration for development: A perspective from Asia and the Pacific. International Migration, 47(5), 23–74. Huy, P. Q. (2008). Exported labour—Practice and policy issues: Vietnamese case. Draft paper for presentation at Conference on Demographic Change and International Labor Mobility in the Asia Pacific Region: Implications for Business and Cooperation, Hosted by KOPEC in collaboration with the Korea Labor Institute. Seoul, Korea: Pacific Economic Cooperation Council (PECC) and the APEC Business Advisory Council (ABAC). Jetin, B. (2017). “One Belt-One Road Initiative” and ASEAN Connectivity: Synergy issues and potentialities. Working Paper No. 30, Institute of Asian Studies, Universiti Brunei Darussalam.

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Kaur, A. (2010). Labour migration trends and policy challenges in Southeast Asia. Policy and Society, 29(4), 385–397. Master Plan on ASEAN Connectivity 2025. (n.d.). Jakarta. Retrieved from http://asean.org/storage/ 2016/09/Master-Plan-on-ASEAN-Connectivity-20251.pdf National Institute for Vocational Training. (2017). Key Findings: Viet Nam Vocational Education and Training Report 2015. National Institute for Vocational Training. Pincus, J. (2016). Vietnam: In search of a new growth model. In M. Cook & D. Singh (Eds.), Southeast Asian Affairs 2016 (pp. 381–397). ISEAS Publishing. Sakata, S. (2013). Introduction: The changing status of economic entities in Vietnam. In A. Sakata (Ed.), Vietnam’s economic entities in transition (pp. 1–22). Palgrave Macmillan. Severino, R. C. (2013). Message. In S. B. Das (Ed.), Enhancing ASEAN’S connectivity (pp. xiii–xiv). ISEAS Publishing. The ASEAN Secretariat. (2014).ASEAN State of Education Report 2013. The ASEAN Secretariat. Tullao, T. S., & Cortez, M. A. A. (2006). Enhancing the movement of natural persons in the ASEAN region: Opportunities and constraints. Working paper for Asia-Pacific Research and Training Network on Trade, Working Paper Series, No. 23, December 2006. Bangkok, Thailand. Vineles, P. (2018). ASEAN nations must talk so that their labourers can walk. Retrieved August 1, 2018, from www.eastasiaforum.org Yue, C. S. (2014). Demographic change and international labour mobility in Southeast Asia—Issues, policies and implications for cooperation. In K. Saichai (Ed.), Politics and regional integration in greater Mekong sub-region (pp. 93–129). Faculty of Political Science and Public Adminstration, Chiang Mai University. Zhang, J. (2016). What’s driving China’s One Belt, One Road initiative? Retrieved July 1, 2018, from www.eastasiaforum.org

Dr. Mukda Pratheepwatanawong is a Researcher working on a number of research projects at Center of Excellence for Mekong Studies, Institute of Asian Studies, Chulalongkorn University, Thailand. She received her Ph.D. from The University of Nottingham, which was fully funded by the University. In her PhD, she explored into political communication, political public relations on social media during the 2013 Bangkok Gubernatorial Election campaign with the use of mixed methods. Currently, she is doing her research on digital vote-canvassing network and the use of social media for the 2019 General Election campaign in Thailand. She also focusses on ASEAN connectivity, foreign investment, labour mobility, digital divide and social media, with Vietnam as area of focus.This research “Opportunities for New Trend of Labour Mobility from Vietnam as a Result of Doi Moi, ASEAN Connectivity and Belt and Road Initiative” was funded by Ratchadapisek Sompoch Endowment Fund, Chulalongkorn University.

Chapter 8

BRI and the Indo-Pacific: Narratives of Traders and Warriors on the Silk Road Bhavna Singh

Abstract As a millennial project, the BRI rolls out a significant change in not only the outreach of China’s maritime strategy but also reflects the significant economic transformation that it will bring about largely due to its scope and scale. This development model would also lead to the proliferation of mercenary armies and private merchandise that would bring up fresh complications in maritime trading. In context of the seven Ming-era treasure voyages commanded by the fleet of Admiral Zheng He between 1405 and 1433, that continue to symbolize China’s Maritime Silk Road, this paper attempts to draw linkages from historical trade routes to look at India’s growing linkages with the Southeast Asian Region. Ever Since the Travels of Marco Polo was published, interest in China’s maritime history has been increasing and recently with China projecting its maritime influence in movies like the Wolf Warrior II and similar cases elsewhere, it becomes even more important to decipher what China’s maritime strategy would entail for future traders and warriors. Dwelling on the Silk Road spirit which refers to the key values mentioned in the “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st Century Maritime Silk Road” Document which endorse “peace cooperation, openness and inclusiveness, mutual learning and mutual benefit”, it builds on the narrative of the traditional Silk Road Legend.

Introduction Since the travels of Marco Polo was published in Europe in the late thirteenth century, myths and legends about China and the orient have attracted a lot of Europeans and led to a great number of works about China written by missionaries in their pursuit of the Kingdom of Prester John, even causing the trend of Sinomania. Now with the endorsement of the Belt and Road Initiative that seeks to reinvent the Silk Road, interest has renewed in the history and policies of various dynasties and the importance of Silk Road in their trade and development. What is remarkable about this “new wine in old Bottle” is that never in the history of mankind have so many B. Singh (B) McKinsey & Company, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_8

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resources been devoted to making infrastructure connections with so many countries as China has done under the “one belt, one road” or belt and road initiative (yidai yilu in Chinese). Since the initiative was launched in 2013 several theories have been extrapolated to explain the scope and canvas of its outreach under the garb of “geodevelopmentalism” which grows out of functionalism in International Relations and mercantilism in international political economy as well as their later versions of neofunctionalism and neo-mercantilism (Elgar, 2019, p. 94). Mercantilism has thrived ever since the advent of Europeans in the fourteenth century and is no newcomer even to the Asian economic cycles. The language of Belt and Road is one of ambitious acceleration and scaling up which is mirrored in the leveraging of history and heritage. Besides, the Maritime Belt of the OBOR/BRI is intrinsically linked to the Chinese Dream of becoming a Great “Maritime Power”. As explained by Sun Weidong, Chinese ambassador to Pakistan. “The Chinese Dream is a dream of peace. Throughout history, China has sought peaceful relations with other countries. China will never seize development through colonization and plundering. More than 1300 years ago, the Chinese famous monk Xuanzang came to South Asia through the Silk Road. He stayed in Taxila, which is only 32 km from Islamabad. He learned from and exchanged with others in Taxila and promoted friendly exchanges between China and South Asia. 600 years ago, a Chinese navigator named Zheng He led the biggest fleets to South Asia for trade, which stands in sharp contrast to colonization and plundering of the west. Zheng He is a Muslim by the way. China will insist on the principle of peace and friendship, strive for development in a peaceful in a peaceful global environment and promote world peace through self-development” (Sun, 2013). In fact, the Zheng He Association” is going to be set up in Malaysia to promote trade and investment between Malaysia and China. This is but one example how anecdotes from history are being used and interwoven to build a narrative for the success of this grand project. It speaks to the ways in which the five pillars of Belt and Road—most notably people to people ties have become the architecture through which framings of the culture and history are diplomatically exercised (Winter, 2019, p. 19). Against the background off the Song dynasty (1127–1279) in Hangzhou in southeastern China, the Maritime Silk Road increasingly flourished. The treasure voyages, the seven Ming-era maritime voyages of the treasure fleet commanded by Admiral Zheng He between 1405 and 1433, symbolized the flourishing of the Maritime Silk Road. Chinese diplomatic and political discourse elevates this narrative from time to time as has been cited fleetingly by Deng Xiaoping back in 1984 as an example of an open-door policy, Zheng He also came to prominence as a form of cultural propaganda in the late 1990s as part of an increasingly internationalist China. Again in late 1997, Jiang Zemin and in 2003–2013, Hu Jintao cited him as a symbol of peace and friendship among other early travellers. With China still struggling to catch up with the US military position, Zheng He provides a valuable soft-power resource with regional neighbours. His narratives have been applied also as an effective tool of diplomacy as far as establishing contemporary relations with Asian and African countries are concerned. Recently, efforts to find evidence of Zheng He’s lost ships were stepped up

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with the Chinese government committing USD 2.4 million in maritime archaeology assistance resulting in the discovery of some porcelain artefacts containing dragon symbols and reviving contacts with Kenyan news outlets who continued to report that Ming-era porcelain and coins were found off the coast and in villages (Mavin, 2015). Over the past decade Nairobi and Mombasa have become key infrastructure projects with multibillion-dollar investments into ports, pipelines, rail, and electricity production projects. The investment in Lamu increased over USD 5 Billion in 2014 and is set to become a catalyst further under the BRI. In May 2014 several contracts worth USD 3.6 billion to connect Mombasa to Nairobi by rail were signed mostly covered by China which made further intersections of the past and present guide the Maritime Silk Road towards littoral areas with Sri Lanka gaining significance in the Indian Ocean Region. This bears strong influence especially in a context of rising Chinese investment in Kenya and the country’s strategic importance as a gateway to East Africa. Though trade flourished relatively well along this route since ancient times, the understanding of cultural exchanges along this route has been vague till recent times and even more vague has been the understanding of China’s influence in the tangentially opposite direction of the Maritime Silk Road towards Southeast Asia. The term Seidenstabe (Silk Road) was first invented by Ferdinand von Richthofen (1833–1905), a German geographer (Liu, 2019, p. 3). This paper intends to explore the historical linkages and the current dimension of the connectivity scope provided by the BRI—being considered a millennial project (also called the project of the century with a total investment of USD 4 trillion to USD 8 trillion and an indefinite timescale) which presents opportunities of connectivity on an unprecedented scale. It sees where and how maritime countries like Japan and the ASEAN figure in China’s vision of the Indo-Pacific and the significance of this project in China’s future energysecurity needs and ambitions for long-term economic growth. Dwelling on the Silk Road spirit which refers to the key values mentioned in the “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st Century Maritime Silk Road” Document which endorse “peace cooperation, openness and inclusiveness, mutual learning and mutual benefit”, it builds on the narrative of the traditional Silk Road Legend and tries to gauge the challenges for India in the Indo-Pacific region and its ability to hedge China’s growing influence.

BRI: A Politics of Routes The metaphor of the Silk Road invokes the language of building connections between and among cultures and civilizations and has been promoted as a project (project of the century) that is open and inclusive and not exclusive. While most often architecture and archaeological landscapes have been deployed in the politics of nationbuilding as elucidated by Benedict Anderson, this is one such project that deploys preservation and symbolic loading of the material past as heritage to present a vision of regionalism. The project is significantly different from the mantra of integrative

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projects such as the European Union as envisioned in the Asian Infrastructure Investment Bank (AIIB) with its initial USD 40 billion Silk Road Fund. This massive financial stimulus, driven largely by China, highlights the evolution of an infrastructure matrix across the Eurasian region representing a massive antirecessionary stimulus package for the coming decades (Winter, 2019, Op Cit, p. 90). Camel caravans and the winding pathways of previous centuries become similitudes for oil gas pipelines, highways, and rail connections stretching across Central Asia into Europe and down to Southeast Asia. The Maritime Silk Road bears strong resemblances of the fifteenth-century fleets and shipyards with warehouses evocative of today’s network of deepwaters ports, container shipping terminals and massive coastal developments. Though much has been said about its western leg, some even calling Xinjiang as a “continentalist growth pole”, the maritime dimension has been largely under-represented which is, in reality, more volatile and nebulous. Not only Xi Jinping but also leaders from the lower rung have supported completely the narrative to invoke and endorse the subtle ways of the historical Silk Road trade as a mantra for peaceful cultural connections. Recollecting how ancient Chinese technologies of iron smelting, farming and irrigation were brought to neighbouring countries to the west and south of China and greatly increased those countries’ productivity, medicine calendar and sculpturing art from South Asia were applied and valued in China, several other important items have become significant exchange items of trade among these South Asian countries in recent times. Notable among these are the Sandalwood from Timor-leste, elephant from Thailand, wood sculpture from Laos, leather and fur from Russia, coloured glaze from Europe and west Asia, and gems from Pakistan, Myanmar and Sri Lanka were all highly popular with ancient Chinese. Xi Jinping earlier on proposed for the Silk Road to be evolutionary and grand in scale citing how “the sea is big because it admits all rivers” meanwhile strategic interests have kept the maritime latch firmly affirmed to the terminologies of gateways or starting points. Most explicitly, speeches from senior Chinese diplomats and politicians firmly anchor the origins of the Silk Roads within China itself. While the eastern end of the overland route in China and specifically at Xi’an is relatively dispute-free, the maritime connections between China and Southeast Asia feed into the disputes and tensions over the South China Sea. Perceptibly, hardening relations with the US and disputes with ASEAN and Singapore over territorial waters were some major issues that provided both the background for the conceptualization of BRI as well as the amphitheatre where the diplomatic dances of new Maritime Silk Road played out. The narratives on historical figures form a part of the discourse that seeks to shift the focus of the South China Sea and the Straits of Malacca away from disputed ownership rights towards a language of routes, connections and free passage from the Chinese point of view. Not only is this a process of projecting China’s power globally but also stretching its maritime outreach. China’s first forays into statefunded maritime archaeology began in November 1987 and started its first openwater project in the mid-1990s, which took place in the Paracel Islands, a location

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that has been the focal point of contested ownership claims between China and Vietnam since 1974. The Underwater Archaeological Research Centre (UWARC), located within the Ministry of Chinese History was established in 1987. In 1989 new legislation was passed regulating underwater archaeology in territorial waters with a specific prohibition on any unlicensed commercial salvage operations. The UWARC implemented a number of searches for vessels from Zheng He’s fleets and China also celebrated the six hundredth anniversary of Zheng He’s first voyages in 2005 along with supporting extensive celebrations in Indonesia, Malaysia, Singapore and the Philippines. BRI heritage diplomacy has been built and the continuities that exist in the years before and father its 2013 launch. Overall the Vision and Action Plan of BRI featured six corridors with a plan to link up “key economic industrial parks” and cities as far as southern Europe, eastern China and Southeast Asia with multiple urban nodes of connectivity in between with five key priorities—policy, facilities, trade, finance, and people-to-people diplomacy reaching a broad range of social and cultural fields, including medicine, education, security, tourism, cultural and environmental preservation, traffic management, optical cable networks, civil aviation, banking and film festivals (Winter, 2019, Op Cit, p. 102). It is important to mention here that in 2014 the Silk Road International Cultural Forum scheme was launched, with an initial event in Astana, Kazakhstan, followed by a second forum in a Moscow a year later. The Silk Road International Arts Festival expanded its ambitions rapidly with its third annual event in 2016 in Xi’an featuring calligraphy, painting and photography exhibitions as well as 2 weeks of performances by artists from more than eighty countries. The year 2014 saw the launch of two Silk Road film festivals, the first in Dublin and then in Beijing, which commenced its annual program in October. In July 2015 the inaugural Silk Road Dunhuang International Music Forum took place in Gansu province. In return similar cultural cooperation programs launched in various countries for the Maritime Silk Road, Hong Kong being the starting point for the One Belt One Road Visual Arts Exhibition featured artist from countries around the region and included fashion shows with clothes “inspired by the ancient Silk Road’s role in cultural exchange”. Even the United Nations helped to spread the tentacles of Silk Road heritage diplomacy with the New York headquarters hosting theatrical performances and art exhibitions on the Maritime Silk Road less than 3 years after Xi Jinping’s first speeches in Kazakhstan and Indonesia recognizing the legacy of an array of movable and immovable material culture, including monasteries, post houses, forts, cave temples, Buddhist pagodas, tombs, textiles, documents, leather goods and ceramics. The Chinese have craftily identified the cultural heritage of the Silk Roads, both maritime and overland looking beyond their own borders and in part relinquishing the concept of patrimoine national in favour of a language of shared heritage based on itinerant histories. The joint submission by Tajikistan and Uzbekistan for the Penjikent-Samarqand-Poykent corridor was referred to the UN list of world heritage

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sites between 2009 and 2012 while China, Kazakstan and Kyrgyzstan jointly celebrated the addition of the Silk Roads, especially the routes Network of Chang’anTainshan Corridor to the prestigious World Heritage List. Several tourism Infrastructure projects have been quickly slated for development, including the Silk Road International Museum City and Silk Road Expo Park. Led by the Tang West Market Group (TWMG) consortium a proposal has been made pivoted on museums and pavilions exhibiting the arts, crafts and archaeological artefacts of Silk Road countries around the region. Simultaneously there is a realization that over the coming years the Asia–Pacific region will be the key driver in increased tourist arrivals worldwide, expected to climb from around 1 billion per year in 2016 to 1.8 billion by 2030. Expeditions were launched to expedite the search for Zheng He’s ship wreckage off the Sri Lankan coast in 2012 and 2014 (Kenya and Sri Lanka are two examples of the promotion of a Zheng He heritage industry being incorporated into the bilateral agreements of central government). As a part of Beijing’s strategy of building deep-water port facilities around the Indian Ocean—the so-called string-of-pearls program-projects in Colombo and Hambantota have been funded through loans of USD 1.4 billion and US D1.7 billion, respectively. Chinese involvement is not simply limited to commercial projection of its interest in the port but also other infrastructure build up like construction of shopping malls, residential towers, a marina and tourism infrastructure. The project stretches across more than 550 acres, 217 of which have been leased to the China Communications Construction Company for ninety-nine years along with the development of a nine-hundred-megawatt power plant simultaneously. Historical connections have been repeatedly co-opted by the state along with the maintenance and upkeep of the museums which function as the primary record building mechanisms. As the Straits of Melacca became vital to fifteenth-century international trade, historical memories of the port state of Melacca and the Ming dynasty were evoked from the first half of the fifteenth century. The evidence at the timber building museum alongside the Malacca River which is located on the site of an original guanchang, suggests that the fleets and voyages led by Zheng He or Cheng Ho were sometimes described as “military garrisons-cum-treasures” while at the other times they were used for commercial purposes like storage of currency and food. The Museum is part of several long-term efforts by a group of historians and business people to promote the memory of Cheng Ho in Southeast Asia. Beijing committed USD 10 billion towards the Malacca Straits for over 10 years starting from 2015. The BRI initiative has also become a vehicle for Chinese-funded research centres in neighbouring countries. In 2016, the Royal University of Phnom Penh created such an initiative, the Maritime Silk Road Research Center which provided a gateway for sourcing further funds from the Asian Investment Infrastructure Bank and its Silk Road Fund to the Cambodian Government. In June 2015, the Confucius Institute of Maritime Silk Road was also inaugurated as a collaboration of twenty-seven educational institutions across Thailand providing a pilot model for similar educational and cultural exchanges between Thailand and China (Xinhua, 2016). These

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collaborations are believed to have laid ground for educational bilateralism in the form of Silk Road Think Tank Network, the New Silk Road Law schools Alliance, Maritime Continental Silk Road Cities Alliance, Belt and Road Think Tank Association, University Alliance of the New Silk Road and the International Silk Road Think tank Association.

ASEAN & the China’s Reluctance of Endorsing the Term Indo-Pacific The Annual Report to Congress from the Office of the Secretary of Defense of the US administration in 2018 identified that programs like the BRI and Made in China 2025 have sparked concerns about China’s intentions despite the Chinese leaders softening their rhetoric when promoting these programs. Xi Jinping especially emphasized that this was in tandem with the shift towards a more multi-polar international order and deepening economic inter-connectivity through globalization (Annual Report from the Office Secretary of Defense US, 2019). The 18th Party Congress report highlighted China’s rise as accelerating the need to reform global governance systems and shift the balance of international power towards multi-polarity. Yet China wants to make sure that it is one of the dominant players in this multipolar set up thereby endorsing only the discourse it chooses to apply. China’s resistance to accept the discourse shaped around the Indo-Pacific is largely evident in its insistence on the usage of the term Asia–Pacific. It has not taken lightly to the US promotion of the construct of the Indo-Pacific though India and the US have presented an all-inclusive vision of the Indo-Pacific (Laskar, 2019). Over the last decade, Russia and China have each invested in a network of technologies such as integrated air defense systems, ballistic and cruise missiles, advanced aircraft and hypersonic weapons (Makichuk, 2020). China intends to rope in other countries and ensure the stability and security in the Asia–Pacific through an elaborate network of land ports, some militarized other non-militarized. For this purpose they have deployed air base kits used in Europe, the RBCP kits would include equipment supportive of expeditionary operations, such as rapid runway repair material, power generators and communications gear. Russia’s continued support and China’s rise as maritime power have raised concerns among the ASEAN countries who believe that it could lead to the loss of ASEAN’s centrality in Asian affairs. A key source of distrust being the fact that China remains embroiled in territorial and maritime boundary disputes with other Southeast Asian neighbours such as the Philippines, Vietnam, Malaysia and Brunei and other countries along the South China Sea. Cambodia is as close to being a client state but is showing a sign of resistance due to Beijing’s smothering economic embrace and diplomatic pressure (Shambaugh, 2016, p. 137). The strategic importance of the Southeast Asian countries however cannot be overlooked. The MSR aims to establish three “blue economic passages” that will

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connect Beijing with economic hubs around the world with a total investment of USD 1–4 trillion in new roads, railways, ports, and other infrastructure. The Maritime belt comprises not only of the six sea lines of ocean shipping: Middle East line, South America line, North Africa line, East Africa line, West Africa line and North America line that are involved in China’s import of crucial resources and its export of merchandise, but most significantly lynchpins are the choke points at the Straits of Malacca and the Strait of Hormuz, the Mozambique Channel and the Bab-el-Mandeb. 70–80% of China’s imported crude oil and more than 50% of other seaborne cargoes have to pass through the Straits of Malacca. The maritime Silk Road is however not a new terminology by any means. It started from the southeastern coast of China, passed through the Indo-China and countries on the South China Sea, the Indian Ocean, the Red Sea and ended in Eastern Africa and Europe. The maritime route originating from Guangzhou on the southeastern coast of China and heading for countries in Southeast Asia on the northern Indian Ocean on the Red Sea coast, in Northeast Africa and in the Persian Gulf, even could be traced back to the Tang Dynasty. From the perspective of history, the process of modernization of a major country is in fact a process of expanding its supply of crucial resources in the process of their economic rise (Liu, 2019, p. 57). In this modernized version of the maritime belt, Hong Kong and Singapore have emerged as two nodal points with Hong Kong setting up a Maritime Authority aimed at strengthening Hong Kong’s maritime logistics in line with Beijing’s economic policy. The MSR will extend from the Quanzhou province in China from Kuala Lampur to Kolkatta crossing the northern Indian Ocean to Nairobi Kenya. An important part of the advancement in the Indo-Pacific would be attempts to seek additional military bases in countries with which it has longstanding friendly relationship and similar strategic interests. A precedent already exists in Pakistan for hosting foreign militaries. Towards this end China has not only been busy with influence operations against media, cultural, business, academic and policy communities in other international institutions but also extending its military reach by the use of its aircraft carriers. China’s first domestically built aircraft carrier launched in 2017 is already completing multiple trials and its second domestically built carrier is projected to be operational by 2022. The CCP also seeks to condition foreign and multilateral political establishments and public opinion to accept China’s narrative surrounding its priorities like OBOR and South China Sea territorial and maritime claims. More recent narratives about the benefits of BRI and the protection of rights and interests overseas are increasingly converging into a single broader narrative about China’s preparedness to contribute to common security in the areas covered by BRI. Each of the 10 busiest container ports in the world are situated along the shores of either the Pacific or the Indian Ocean, and more than half of the world’s maritime trade in petroleum transits the Indian Ocean alone hence the imperative for its energy diversification strategy actually arrives from it growing need for resources, stretching global outreach and the development of the PLA Navy’s blue water capabilities (Len, 2017). Except for the initial debates on these grand connectivity plans on whether they form a part of China’s Marshall Plan or bear similarity to the British Empire’s Railways Project, the larger concern has been to explore the economic viability of

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new port construction projects associated with the MSRI. The major considerations for the Chinese have so far been the proximity to major shipping lanes; proximity to existing ports; and hinterland connectivity which lay the framework for further construction and development activities. A more opaque part of these infrastructure projects is the build-up of hinterland access which evolves in a probing growth for development and extraction of interior resources, for instance in the case of the Gwadar and the Hambantota Port projects. The Kyaukpyu project is sought bring around similar benefits for the multiphase China-Myanmar Economic corridor. The ASEAN countries have to a large extent adopted a strategy of accommodating and influencing as well as counterbalancing and containing the Chinese idea of influencing the Maritime BRI, specially Indonesia and Vietnam. Similar strategies have been adopted by Japan and other littoral countries as discussed below.

BRI and the Relative Undermining of Japan Though Sino–Japanese relations have seen a relatively positive trend through investments and economic collaboration over the last few years, Xi Jinping’s project for the century has relatively lesser consideration for Japanese economic ambitions. Infact, Jonathan Hillman suggests that the “Belt and Road is so big it is almost impossible for one person to have mastery of it” (Macaes, 2019, p. 8). And even China might not grasp the consequences of the whole thing. No wonder then, the Japanese angle is not to be found anywhere among any of the academic deliberations on the BRI. Irrespective of the fact that the Chinese Initiative has renewed land component that aims to replace camels with trains, even the maritime component does not a have a particular role for Japan. Though so far the BRI initiative has been looked at from the perspective of a geopolitical approach, another possibility is to look at it as a grand deception. The trope of hidden agenda has a long history in analyses of Chinese foreign policy, not very different from Deng Xiaoping’s “taoguang yanghai”. While the concept that Xi Jinping has evolved to include the influential phrase “yousuo zuowei/fenfa youwei” (get something’s done or striving for achievement) is just an evolutionary dictum that adds to Deng’s wisdom on China’s place in the global strategic balance. And the fact that Japan is not in the slightest involved with this project despite being part of the four core countries that form resurgent Asia which comprises 500 million people and with a GDP of USD 737 billion, indicates towards this deceptive and exclusionary/narrow strategy towards Japan (Dutt, 2010, pp. 378–387). China’s increasing investments around the world are literally buying the country international influence. The BRI was one such initiative that was to become the face of China’s economic strategy to export economic surpluses (like cement and steel) through heavy investment in politically unstable regions. With a stronger maritime element it should have had a pronounced role for Japan. But Japan is still heavily dependent on the US for its security and hence, China’s neglect to Japanese sea power is glaring and despite the lofty aspirations the economic viability of the new Silk Road remains unproven.

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On the contrary, the Japanese strategy seems more defined with recurrent efforts to woo other Asian powers reflected in the visit of the Japanese Defence Minister Itsunori Onodera to Sri Lanka in August 2018 for the very first in the history of Sri Lanka and Japan. He visited several ports like the Hambantota, Trincomalee and Colombo ports, in a bid to counter China’s strategy of building ports in Bangladesh (Sonadia), Myanmar (Kyaukpyu) and the Maldives (Laamu Atoll). China already has a presence in the Colombo port (the Colombo International Container Terminals) and Hambantota port, which it has taken on a 99-year lease with a 70% stake besides the Gwadar port in Pakistan (Daily FT, 2018). The Japanese naval vessel “Ikazuchi” was in Trincomalee during Onodera’s visit with an intention to counter China’s dualuse investment in infrastructure projects with possible military implications. The Japanese military is already operating a Japanese-Sri Lankan project for ‘Maritime Safety Capability Improvement’ worth approximately 1.8 billion yen or USD 16.5 million, which includes the provision of two patrol vessels to the Sri Lankan Coast Guard (Ibid). Besides, Japan’s 2015 “Partnership for Quality Infrastructure” initiative involves infrastructure spending around USD 110 billion in Asia over 5 years. In 2016, the initiative was expanded to USD 200 billion globally (including in Africa and the South Pacific). Japan has expanded its outreach in the Indo-Pacific by providing loans and helping in constructions of deep-sea water ports, for instance, the Sri Lankan Coast Guard (SLCG) placed an order for the construction of two 85-m Offshore Patrol Vessels (OPV) with the CDL to enhance its capabilities in deepsea surveillance. Japan is not only converting its Self Defence Forces into regular armed forces, but is also sewing up political, economic and military alliances with key countries in the East–West trade route (Ibid). However, Japan’s responses need not necessarily be considered as always in opposition to the Chinese projects but are definitely more credible, transparent and of high quality and hence attract more approval from international bodies.

India and China and the Struggle for the Indian Ocean The Chinese have repeatedly insisted that they wish to work with maritime powers of the Indian Ocean and beyond and to make the neighbouring oceans secure for unimpeded commerce and peaceful navigation. They have showed special interest to ensure that the Indian Ocean is conflict-free and there the Sri Lankan port can take prominence along with other ports like New York, Dubai, Singapore, Hong Kong and others. As Xi Jinping flew his own kite describing how the 30 years opening up reform had enabled China to marry China’s advantage in market and labour resources with the capital and technology of developed countries in the pursuit for win–win cooperation, it was reaffirmed by Wang Yi in 2015 that this came about by their own ability to tighten the belt by which they managed to lend a helping hand to a large number of developing countries in Asia, Africa and Latin America.

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The most stark projection of BRI in the Indo-Pacific and the Near region has not however been the concerns surrounding the security of sea lanes and maritime security in the oceans but rather the signalling that country’s legitimacy is still based on a Sino-centric history of globalization. The Chinese have dubbed the Silk Road as a prototype version of globalization from historical antiquity which offers an alternative to the “west-centric” paradigm and a more “Asia-centric” approach in trade and commerce. Bertil Lintner has infact argued that China—like other powers that have dominated the international system seeks hegemony and the Indian Ocean is an increasingly crucial area of operations for it to achieve this end. The Indian ocean in his view, is the likeliest place to come into conflict failing a “utopian ‘powersharing’ agreement” between the US and China with several maritime “gray zone” operations being carried out just short of the red lines of adversaries. The Indian Ocean and East Asia are militarizing rapidly and Beijing’s desire to see Belt and Road succeed necessitates a sustained multidirectional program of diplomacy. India for its part is balancing China’s North–South connectivity to Southeast Asia by promoting East–West connectivity through Myanmar, Thailand and Vietnam and the North–South Transport Corridor with Russia. Recently, the Indian Navy situated a guided rocket frigate, the INSKarmuk, off the Andaman and Nicobar Islands and braced up Bay and Bengal to keep Chinese submarines from going by the Indian Ocean locale (IOR). India is constantly keeping a check on China’s advance by reclaiming its maritime space have been evident as New Delhi positioned two P-81 maritime reconnaissance aircraft in the Andaman Islands following reports that a Chinese submarine tender had ventured close to the strategic archipelago. India also tried to expand its own diplomatic influence by sending its aircraft carrier to visit nearby ports in Colombo, Sri Lanka, Male and Maldives in the same deployment followed by gestures of naval assistance, including sending a high-end patrol vessel to Mauritius in 2014 (Kumar, 2018, p. 20). More importantly, India appears to be fine-tuning its combat machinery in the South Asian Littoral. The Indian Navy, which commissioned an airbase on the southern tip of the island chain in 2012, has now proposed the Maritime Infrastructure Perspective Plan to transform smaller naval detachments at the Lakshadweep and the Andaman Nicobar Islands into the larger maritime hubs. Hinting at greater strategic synergy in regional maritime endeavours, India is also undertaking infrastructure projects that would enhance the capabilities of the regional defense forces. As it is a key component of the Indian Navy’s operational doctrine is the diplomatic dimension of regional maritime missions. India is now also taking care of its commitments towards transnational crime and environmental degradation under its various security cooperation commitments under the US security umbrella and also with Sri Lanka and Maldives creating a regional mechanism for tackling non-traditional threats in South Asia since 2011. India’s principal predicament in the Indian Ocean, however, is still finding the right balance in its maritime relationship with China, since it is rising state in Asia as well as its biggest competitor globally. Hence India’s approach to China’s attempt to gain control in the Indian Ocean, often considered its own backyard, has to be weighed and balanced to maximise its own

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interests even if it is able to benefit from the transportation network provided under the umbrella of the BRI.

Conclusion Indeed, the economic and development corridors of belt and Road will no doubt stutter and stumble and in some cases fail to materialize in the ways that agreements and master plans envisage but it is also likely to bring in new forms of political transformations whereby states may co-opt transboundary routes and connections to reinforce existing policies. The story of the Silk Road puts these objects in an all-expansive narrative of Chinese global history. Randall Collins discussion of civilizations as “zones of prestige” helps pinpoint some key dynamics in play here. For Collins, civilizations exert a power of attraction that radiates outward via unevenly formed networks and along particular channels. In this setup, sojourners and pilgrims, traders and students become the agents of prestige transmission by travelling inward toward centres of creativity and activity or sent out to cross great distances and border zones to communicate particular ideas and values. BRI would ultimately be one such phenomenon by which the future generations would measure the level of civilizational charisma and the degree and distance of its attraction. The strategies for acquiring influence and resources in the twenty-first century are markedly different, while securing new territories by military means dominated earlier, the significance of transboundary infrastructure and international trade is elevated now. BRI both on the Silk Road as well as maritime is today an appropriation of a narrative of the past that is both nationalist and internationalist and crucially not claimed as an exclusive patrimony. The corridors thus conceived work as smoothing devices, creating visions for infrastructure construction across highly uneven and unpredictable physical and political landscapes alike. Though at the front the BRI may appear simplistically as a key strategic framework for remaking the international order towards a China-centric Asia, but there is in effect a deep reverberation of China’s version of soft power and international diplomacy that differs from that of western countries and the Cold war era thereby bringing about a fundamental structural change in the outlook of trade and diplomacy. China has promoted the Silk roads and the Maritime Belt as a shared reclaiming of dignity and sovereignty, a new flowering after histories of humiliation carrying the spectre of the “Asian values” discourse. Strategic narratives are after all a means for political actors to construct a shared meaning of the past, present, and future of international politics to shape the behaviour of domestic and international actors and a tool to extend their influence, manage expectations and change the discursive environment in which they operate. Hierarchies and asymmetries are of power are readily acknowledged, though initially with hesitance from India but the Chinese have been more than wanting to bring India into the fold of this new economic Pax Sinica. Most importantly the historical Silk Roads become a metaphor for non-interference. For some, such as Ravi Bhoothalingam, the narrative of the historical Silk Road signals a future of Asian

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co-prosperity built around cooperation citing how Marco polo said “I have not told half of what I saw. As long as the Silk Roads give visibility to the much-overlooked aspects of Eurasia’s past giving a more Sino-centric history of globalization, it is likely to agitate some regional neighbours. Combing the broad arc of history, the future will undoubtedly see additional chapters written in biographies of the overland and maritime Silk Roads. The MSR which quite literally mirrors the situation of the overland Silk Road and has been questioned for its scope as being tactical enough or overstretched, evokes one such grand narrative that will continue to paint the canvas of the China’s grand strategy for a long time to come.

References Annual Report to Congress, Military and Security Developments involving the People’s Republic of China. (2019). Office of the Secretary of Defense US. Daily FT. (2018). Japan moves in to thwart Chinese ambitions in the Indian Ocean. Retrieved November 10, 2019, from http://www.ft.lk/columns/Japan-moves-in-to-thwart-Chinese-ambiti ons-in-the-Indian-Ocean/4-661517 Dutt, V. P. (2010). Japan in a Resurgent Asia. In G. Balatchandirane (Ed.),Japan in a Resurgent Asia (pp. 378–387). Manak Publications. Elgar, E. (2019). Theorising ‘One belt one road’ in understanding China’s new diplomacy, Silk Roads and Bullet Trains in Gerald Chan edited New Horizons in east Asian Politics, Chetlenham, UK (p. 94). Kumar, A. (2018). OBOR: China’s alternate Indo-pacific policy (p. 20). Prashant Publishing House. Laskar, R. (2019). Decoding the Indo-Pacific and China in Indian Ocean. The Hindustan Times. https://www.hindustantimes.com/india-news/decoding-the-indo-pacific-and-china-in-ind ian-ocean/story-G00YTptqR9wXfbZGJ196TK.html Len, C. (2017). China’s Maritime Silk Road and energy geopolitics in the Indian ocean motivations and implications for the region. The National Bureau of Asian Research. https://www.nbr.org/ publication/chinas-maritime-silk-road-and-energy-geopolitics-in-the-indian-ocean-motivationsand-implications-for-the-region/ Liu, W. (2019). The Belt and Road initiative: A pathway towards inclusive globalization (p. 3). Routledge, Taylor & Francis Group and The Commercial Press. Macaes, B. (2019). Belt and Road: A Chinese world order (p. 8). Penguin. Makichuk, D. (2020). Hell in Asia-Pacific: The USAF alters its plan. Asia Times. Mavin, D. (2015). Calculating the revenue from antiquities to Islamic State. Wall Street Journal. Shambaugh, D. (2016). China’s future (p.137). Polity Press. Sun, W. (2013). Peaceful development and Win-win Cooperation (Speech, National Defence University, Islamabad, Pakistan). http://pk.china-embassy.org/eng/zbgx/t1076545.htm Winter, T. (2019). Geocultural power, China’s quest to revive the Silk Roads for the twenty-first century (p. 19). The University of Chicago Press. Xinhua News. (2016). Cambodia launches China-backed Maritime Silk Road Research Centre. http://news.xinhuanet.com/English/2016-06/13/c_135432581.htm

Dr. Bhavna Singh is an Independent Analyst who works on issues related to China. She was an Associate Fellow at the Centre for Air Power Studies, New Delhi; a Senior Research Officer with the Institute of Peace and Conflict Studies (IPCS), New Delhi (2010-2013) and is associated with the V-Dem project based at Gothenburg University Sweden as a Country Expert on Hong Kong

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and Fiji (2013-2020). She holds her Ph.D. from Centre for East Asian Studies, Jawaharlal Nehru University, New Delhi. She interned with Mckinsey & Company and has since been a Content Writer. Her work focuses on Chinese Nationalism, sub-regionalism and China’s foreign policy. She is particularly interested in separatist and sub-national tendencies in the regions of Xinjiang, Tibet, Taiwan and Inner Mongolia. She is the author of the book ‘China’s Discursive Nationalism: Contending in Softer Realms’ (Pentagon Press; New Delhi, 2012) and Co-editor for ‘India, China and Sub-regional Connectivities in South Asia’ (SAGE 2015) and has written for several esteemed journals like the Economic and Political Weekly, Mainstream Weekly, Nam-today, World Focus, Epilogue and the China Daily and several web portals like the ISN-ETH Zurich. She was part of the youth exchange delegation between China and India in the year 2008, was nominated to the ‘Taiwan Study Camp for Future leaders of South Asia’ in 2010 and participated in the One Belt One Road Summit organised by the Shaanxi University in 2016.

Chapter 9

CPEC: The Buckle in China’s BRI Sanchita Bhattacharya

Abstract China and Pakistan, friends in “all weather” recognized each other’s independence and sovereignty in the early 1950s. Chinese President Xi Jinping initially proposed to build an “economic belt” and a “21st-century Maritime Silk Road” in 2013 which were formalized as the BRI in a document, “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-century Maritime Silk Road”, released by the National Reform and Development Commission in 2015. The Belt and Road Initiative is designed to connect places and cities along China’s ancient Silk Road and way beyond. In the realm of innumerable projects, Pakistan is seen as the “Buckle” in the Belt of BRI. Like the BRI, the goal of the CPEC is to boost economic integration and transportation networks. In case of Pakistan, CPEC is seen as a chance to develop stronger ties with China in order to enhance its underdeveloped economy. CPEC has faced several jolts in the restive Balochistan Province. In Pakistan, regions in the CPEC are unevenly developed, with backward energy and logistic infrastructures. The ever-present tussle between the military-political establishment in Pakistan is taking a toll on the various CPEC projects as well. The real challenge is whether best practices can be incorporated in BRI or it will remain only a “Chinese” scheme given that state-owned enterprises play the lead implementing role.

Introduction China and Pakistan, friends in “all weather” recognized each other’s independence and sovereignty in the early 1950s. Historic relations between the Islamic Republic of Pakistan and the People’s Republic of China (PRC) have been based on common interests; their security and defense cooperation has been enhanced due to their common animosity with India (Hassan, 2017). Nevertheless, the scale of bilateral relations remained fundamentally neutral during the said decade, the 1960s saw a shift from tactical to strategic dimension with both the countries harmoniously defining S. Bhattacharya (B) Institute for Conflict Management, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_9

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their border and exchanging military hardware. In the following decade of the 1970s, Pakistan was instrumental to realize the Sino–US rapprochement. Moreover, the trajectory of bilateral relations consolidated in the following decades. In the post9/11 period, Beijing and Islamabad ensured continuance of strategic cooperation in fighting radicalism and terrorism in the region and building peace in Afghanistan. However, in this period, the Chinese and Pakistani top leadership planned an overall new dimension in bilateral relations. The presidential-level interaction in 2006 and 2008 resulted in the formulation of what in 2015 was termed as the China–Pakistan Economic Corridor (CPEC) that was placed under China’s broader economic vision of the Belt and Road Initiative (BRI). Chinese President Xi Jinping initially proposed to build an “economic belt” and a “21st-century Maritime Silk Road” in 2013 which were formalized as the BRI in a document, “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-century Maritime Silk Road”, released by the National Reform and Development Commission in 2015 (Chakma, 2019). BRI was proposed to revive the ancient Silk Road. Highlighting the elements of equality, mutual trust, inclusiveness and mutual learning, and win–win cooperation, the BRI reinforces the connection among Eurasian countries in five areas of trade and culture, infrastructure, policy and finance (Yu, 2018).

The Belt and Road Initiative (BRI) The Belt and Road Initiative is designed to connect places and cities along China’s ancient Silk Road and way beyond. Approximately with a budget of USD 900 million projects are either planned or underway. As is highly publicized by Chinese media, the BRI is a demonstration of PRC’s power and might, comprising projects for railway lines, harbours, road networks, bridges, airports, gas and oil pipelines and tunnels. The initiative plans to extend halfway around the world and is a testament of China’s invigorated ambition on the global stage. The various projects under the BRI are funded by Asian Infrastructure Investment Bank (AIIB), Silk Road Fund and the New Development Bank of BRICS. BRI projects are meant to link the Pacific Ocean and the Baltic Sea to each other through roads, rail, and maritime lanes to further liberalize trades around the world. After the BRI came out, its enormous size and predictions that it would be a game changer attracted not only China but also its partners’ interests (Nurmuhammedov, 2017). BRI not only economically places China at a superior position, it also makes a huge change in China’s foreign policy from the period of isolation with serious implications on how the world develops. The initiative is a globe-spanning plan with the purpose of strengthening trade, infrastructure and investment between China and an estimated 65 other countries. Official Chinese media have indicated that up to 68 countries have already become members of the project. Besides its political objectives, BRI has a strategic focus on the government’s “go out” initiative, which supports Chinese firms to go abroad in search of new markets or investment opportunities. The BRI push is

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being led from the highest levels of the government, and participation will run across several ministries (Awasthi, 2018). The Chinese strategy with respect to the enormous expanse of BRI has two components. On the one hand, we see China adopt a definitive “sphere of influence strategy”, which is intended at establishing the country as the principal power in South East Asia and weakening America’s control over Latin America. On the other hand, it is also working towards forming an “alternative global order”. China is assisting a lot of smaller and some would argue, insignificant countries of Africa and Latin America. The goal is not only to attain strong strategic control in these small countries, but also develop them as vital geo-strategic powers in the future (Shukla, 2019). One can say that in a persistent pace, China is establishing its strong and visible presence in Global map. Interestingly, the “Road” refers to maritime network of shipping lanes running from China to Southeast Asia, Africa and all the way to Europe. Few among the important seaports are Fuzhou, Quanzhou, Zhanjiang, Beihai in China; Hanoi in Vietnam; Kuala Lumpur in Malaysia; Jakarta in Indonesia; Colombo in Sri Lanka; Nairobi in Kenya; Athens in Greece and Rotterdam in the Netherlands. On the other hand, the “Belt” refers to the overland route, stretching from Central Asia to Europe. Few of the important cities connected in the route are: Beijing, Lanzhou, Urumqi in China; Almaty in Kazakhstan; Samarkand in Uzbekistan; Dushanbe in Tajikistan; Tehran in Iran; Istanbul in Turkey; Moscow in Russia; Duisburg in Germany and Rotterdam in the Netherlands. Thus, the geographical spread of BRI clearly shows that the Gwadar Port is at the heart of the BRI’s route map.

Belt and Road Initiative (BRI) and China–Pakistan Economic Corridor (CPEC) In the realm of innumerable projects, Pakistan is seen as the “Buckle” in the “Belt of BRI”. The year 2015 saw the signing of the CPEC between China and Pakistan, under the umbrella BRI, which is the world’s largest infrastructural project since the Marshall Plan. Beijing hopes BRI will help enlarge its clout over Pakistan and across Central and South Asia, as well as counter US influence in the region. The geographical location of CPEC plays a key role in enhancing connectivity as part of the BRI. With USD 62 billion CPEC Plan, BRI allows China to solidify its geopolitical standing (Zaidi, 2017). Like the BRI, the goal of the CPEC is to boost economic integration and transportation networks. The strategic importance of energy and port investments as part of the CPEC is addressed in the official Chinese document about the BRI, Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road (hereafter, Vision and Actions on Energy Cooperation). It is also addressed in the 13th Five-Year Plan for Economic and Social Development, published by the

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Chinese Government in 2016, which states that the BRI “will strengthen the development of ports of entry and infrastructure in both inland and border regions and create cross-border multimodal transport corridors” and “will strengthen international cooperation on energy and resources and production chains, and increase local processing and conversion” (PRC NDRC, 2016). The southern region of Pakistan is the shortest route to the Indian Ocean and the Gulf of Basra where the international maritime trade takes place. By now, China is making 80% of its energy import–export by maritime routes. For this reason, it is necessary to use the Malacca Strait to reach the Indian Ocean. Using the Malacca Strait not only increases the transportation cost for China, it also brings the issue of energy security. The narrow and dangerous nature of the strait causes terrorists to attack the merchant ships. Therefore, through CPEC, China aims to shorten both cost and time as compared to using the Malacca Strait, and save billions of dollars. The way through the port of Gwadar is shortened by 6,000 miles compared to the way through the Malacca Strait (Nurmuhammedov, 2017). CPEC route is divided into two sections, the distance from Kashgar to Gwadar is covering a roadway, and distance from Gwadar seaport to different seaports in Europe and the Middle East is a seaway. The container comes from Kashgar (Western China) to the Gwadar seaport (Pakistan)by road and goes to destination seaports by sea (Alam et al., 2019). The CPEC is strategically important due to location of China’s energy suppliers to its east in Iran, Middle East and East African countries. China is world’s largest importer of oil and gas. Since 2013 alone, China’s oil production has fallen nearly 15%, while its oil demand has risen 30% to ~13.8 million b/d. In turn, China relies on imports for around 75% of its total oil usage. China also likes to buy crude when prices are low to stockpile its security inventories, a “rainy day” supply that could currently cover about 80 days of imports. September 2019 crude imports were up 11% YoY. Up from basically zero a decade ago, China’s natural gas import reliance is a rising 45%, despite a doubling in domestic production (Clemente, 2019).

Advantages for Pakistan In case of Pakistan, CPEC is seen as a chance to develop stronger ties with China in order to enhance its underdeveloped economy. Pakistan has been incessantly struggling with number of trials including energy crisis (mainly supply of energy and power distribution) and low levels of foreign investments caused by challenging security environment. The CPEC contributes four main clusters: power sector, infrastructure and transportation, Gwadar port and allied infrastructure and Special Economic Zones (SEZs). CPEC seems like an attractive option for Pakistan to revive its economy and at the same time, counterbalance mounting US economic pressure aimed at ending Pakistan’s support to Afghan militant proxies (Kelemen, 2018). Pakistan is in dire need of a robust power sector and its development through CPEC is given priority by the Government of Pakistan (GoP). Although the idea of

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a transport corridor has been the focus of international attention, power generation makes up the bulk of already completed CPEC projects. If one includes projects implemented and/or financed by Beijing that have not been branded as part of CPEC, energy makes up an even larger share, with power plants accounting for over 90% of the cumulative total cost of projects. This fits the emphasis in “Phase I” of the “Long Term Plan” on addressing chronic electricity shortages—as a precondition for building up Pakistan’s industrial base as well as connectivity with China after 2020 (Eder & Mardell, 2018). The Gwadar Port links the region of South Asia, Central Asia and Middle East with the surrounding region holding 2/3rds of world’s oil reserves. The location of Gwadar port is proximate to the Gulf region, which has rich oil and gas reserves. Connecting the Arabian Sea to the Eurasian heartland, the port could serve as a transit point for alternative routes between China, Afghanistan, Central Asia and Middle Eastern countries. Importing oil from the Middle East to China through the Indian Sea requires over 5,000 km of travel, but Gwadar Port is just 2,500 km from Xinjiang. Consequently, through the BRI, China wants to connect Xinjiang to Gwadar Port, which will be used as a transit point for China’s interior regions and as a trade hub between China and rest of the world (Yu, 2018). It is expected to become an important deep seaport of the world, with planned capacity of 400 million tons of cargo per year which would be highest in the region. In a way the port is the gateway to CPEC of China’s BRI, promising regional prosperity. Chinese investment in Gwadar Port is considered a possible option to “diversify energy supply away from the chokepoint of the Strait of Malacca and vulnerable shipping lanes through the disputed South China Sea” (Hornby, 2017). SEZs are also expected to bring technological advancement, financial investment, job and improvement in the export sector of Pakistan. According to (World Bank, 2017) so far nine SEZs have been identified and will be established across the country under CPEC. It is hoped that SEZ under CPEC will play the same role in Pakistan, as they did in boosting China’s dilapidated economy about 20 years back. Since the beginning of the twenty-first century, numerous regional zones have been established in China to stimulate and anchor regional development. SEZs have contributed significantly to China’s development. They have allowed experimentation with market-oriented reforms and acted as a facilitator for efficient distribution of domestic and international resources. They have also deepened economic opening by attracting international capital, technology, technical and managerial expertise that accelerated industrial development and China’s greater integration into the global economy. While a deep-sea port has been developed at Gwadar, SEZs have been planned to its northeast, in the province of Sindh. This includes Dhabeji in Thatta where 1000 acres have been set aside for the potential setup of cement, steel, pharmaceutical and chemical plants. Due to Dhabeji’s proximity to Karachi and ease of connectivity through M3 motorway to the north and Makran Coastal Highway to Gwadar, Chinese investors have shown a great interest in this SEZ. Many local businessmen in Sindh also are very optimistic about SEZ in Dhabeji because they are hopeful that Sindh will return to its glory days of industrialization of the 1970s when Karachi and its surround areas thrived with industrial activity (Chen et al., 2018).

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The project will also help to increase the export of Pakistani products. For example, fruits and vegetables are produced in northern areas of Pakistan and most of this product cannot be exported due to a dearth of good connectivity. The CPEC will connect the northern parts to Rawalpindi, Peshawar, and Lahore. This will help to improve the exports of agricultural commodities, as most of these goods are transported by air due to their unpreserved nature (Alam et al., 2019). Another prominent CPEC project is a data cable from Gilgit to Islamabad at a total cost of USD 44 million. The data cable will increase the Internet bandwidth for people in northern Pakistan. The locals have mixed feeling about CPEC and its effects on Gilgit. On one hand, the business community is very happy that highway improvement makes it easier to trade as cargo can move with less delay; but at the same time, the business people want projects that can and will do even more for economic development. People of Gilgit are happy to see more lorries pass through and drivers stop to buy food and spend money on lodging (Chen et al., 2018). The naval fleet of Pakistan is less powerful and inexperienced than other important naval nations in the world. China and Pakistan, which saw the incapability of the fleet to guard the CPEC’s ports, have issued a new military strategy document on May 26, 2015, under the name of “Active Defense” Policy, aimed to protect and defend the open seas and increase the efficiency of the sea combats. If this policy achieves its goal, “Active Defense” will have the largest navy in Asia. Though this objective has yet to be heard aloud in the international arena due to the problems met around, the significance of this policy for regional energy security over the Indian Ocean and around against the piracy threats is highlighted (Nurmuhammedov, 2017).

Regional Reality Chinese government is concerned about insurgency fueled instability in neighbouring Pakistan. China’s Xinjiang Uyghur Autonomous Region has a large Turkic-speaking Muslim population which has grown increasingly frustrated with Beijing’s rule. Since the 1990s, Xinjiang has also become the main source of terrorism within China. The spread of radical Islamism in Xinjiang is adding further intricacy to an already tense situation. The ruling Communist party regards Xinjiang’s separatist movement as an existential threat to the party-state. Beijing believes poverty and underdevelopment are at the heart of increasing militancy in the restive province and that the best strategy to address the root cause is assimilating Xinjiang with the neighbouring region (Cai, 2017). The goal is to keep militants from Xinjiang finding assistance and training in the Pakistan–Afghan border regions, and to secure trade routes towards the Indian Ocean and the Middle East. Beijing’s stance is that its state-driven investment in such regions can improve the security environment through economic development (Eder & Mardell, 2018). There are clear indications that CPEC is worsening jihadist movements in both Pakistan and Xinjiang, as translated in heightened activities by both local and international terror organizations such as al-Qaida and the Islamic State (IS)/Daesh (Shams, 2019a, b).

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CPEC has faced several jolts in the restive Balochistan Province as a result of repeated insurgent attacks. Baloch rebels also accuse China of exploiting the Province’s abundant mineral deposits. Claiming responsibility for the Zaver PearlContinental attack of May 11, 2019, the Majeed Brigade of the Balochistan Liberation Army (BLA) stated that “our fighters have carried out this attack on Chinese and other foreign investors who were staying in PC Hotel". Among the most prominent attacks in the recent past include the October 31, 2018, attack in which five construction workers (of CPEC related private housing scheme on Peshkan-Ganz road), of nonBaloch ethnicity (Sindhi and Punjabi) were shot dead while another three suffered injuries near Ganz. Earlier, on August 11, 2018, six persons, including three Chinese engineers, were injured in a suicide attack targeting a bus in the Dalbandin area of Chagai District in Balochistan. Moreover, the Chinese establishments have also been targeted outside Balochistan. On November 23, 2018, BLA carried out a suicide attack targeting the Chinese Consulate at Block 4 in the Clifton area of Karachi, the provincial capital of Sindh (Bhattacharya, 2019). CPEC goes above and beyond its economic influence and has led to unforeseen social impacts that have left many Pakistani residents stunned. Mandarin Centers have cropped up to teach Mandarin to children as young as eight. Schools have realized the extent of Chinese effect on Pakistani Society and have also started teaching Mandarin courses in class. Thousands of Chinese have settled not only in Gwadar and remote areas along the infrastructure routes and connections but also in the major cities of Lahore, Islamabad and Karachi (Chen et al., 2018). Local advertisements on television and even movies featuring Chinese actors spreading messages about the need to increase connectivity are on the rise. In May 2017 Pakistan launched its first Chinese language newspaper for its estimated 10,000 Chinese population (Hassan, 2017). Despite positive spillover effects from these investment projects, some local residents complain about not given priority for employment at the port. According to a local laborer, “when CPEC started I was happy that people like me will have lot of opportunities to make a decent living by working at the construction site but China has brought either its own workers or people of Punjab (the most populous province of Pakistan). They are taking away our living” (Chen et al., 2018). Regions in the CPEC are unevenly developed, with backward energy and logistic infrastructures. For instance, the southern part of the CPEC is still undergoing urbanization and industrialization, so its power facilities are old or overburdened. These areas need investment in new and upgraded infrastructures. In addition, since the consumption of renewable energy is relatively low in the regions involved in the BRI, there is a need for renewable power infrastructure. Resultantly, to meet its energy needs, Pakistan must rely on imported oil and gas (Yu, 2018). The ever-present tussle between the military-political establishment in Pakistan is taking a toll on the various CPEC projects as well. The CPEC was announced during former Prime Minister Nawaz Sharif’s tenure. The Sharif government took great pride and acclaim for the overarching project up until Nawaz Sharif’s removal from office in mid-2017. During Sharif’s final stint as Prime Minister, the CPEC was king (Notezai, 2019). The present Pakistani army-backed government of Imran Khan is not

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very keen on the CPEC. In 2014, Imran Khan’s PTI staged a demonstration against Chinese President Xi Jinping’s official visit to Pakistan, and in spite of “protests”, the project was launched in 2015, delayed by one year. Also, the military generals give priority to defense ties with Beijing, but they also think that huge economic projects like CPEC would strengthen financial ties with China, and political forces would lap up the credit for that. Similarly, in the long run, CPEC would force Pakistan to improve ties with India and other neighboring countries. All this would be in conflict with the military’s security doctrine that gives Pakistani generals an upper hand in the affairs of the country (Shams, 2019a, b).

Estimation The BRI was conceived as a response to the vast overcapacity in infrastructurerelated industries due to credit-fuelled growth in China in 2008 following the global economic recession, when its exports started dwindling. In 2009, former Deputy Director of China’s State Administration of Taxation, Xu Shanda, came up with a proposal which suggested that China should utilize its vast foreign exchange reserves, expertise in building infrastructure, overcapacity in iron, cement, aluminium, glass, coal and shipbuilding industries and unemployed labour to meet the infrastructure demand in Southeast Asia, Central Asia and Africa. Nevertheless, BRI has not succeeded in the full utilization of overcapacity in infrastructure industries. About one-third of its projects are failing due to several anomalies. Several projects suffer from absence of local inputs, protests on land procurement, pollution, performance delays, corruption, financial viability, unsustainable debt and low investment returns. The real challenge is whether best practices can be incorporated in BRI or it will remain only a “Chinese” scheme given that state-owned enterprises play the lead implementing role (Gupta, 2019). Pakistan from its position should focus on completing the project on time and protecting it from all malicious factors that are hampering the growth of the project. The Government of Pakistan should also emphasize on providing equal chances and opportunities to all the provinces to get the benefits from the project particularly, the deprived parts of Balochistan. As has been often criticized that the CPEC in actual practice is a China–“Punjab” Economic Corridor, the attitude of the Federal Government needs alteration. The common people of Pakistan should be transferred benefits so that their standard of living upsurges, education level rises and at all levels, the individuals and groups are benefitted.

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References Alam, K. M., Li, X., & Baig, S. (2019). Impact of transport cost and travel time on trade under China-Pakistan economic corridor (CPEC). Retrieved from Hindawi Journal of Advanced Transportation website: https://www.hindawi.com/journals/jat/2019/7178507/ Awasthi, S. (2018). China led BRI and its impact on India with special reference to OPEC. Journal of International Affairs, 2(1), 97–112. Bhattacharya, S. (2019). Balochistan: Ugly realities. South Asia Terrorism Portal. Retrieved from https://satp.org/second-sight-volume-1-no-43 Cai, P. (2017). Understanding China’s Belt and Road Initiative. Lowy Institute. Retrieved from https://www.lowyinstitute.org/sites/default/files/documents/Understanding%20China%E2% 80%99s%20Belt%20and%20Road%20Initiative_WEB_1.pdf Chakma, B. (2019). The BRI and India’s neighbourhood. Strategic Analysis, 43(3), 183–186. Chen, X., Joseph S. K., & Tariq, H. (2018). Betting big on CPEC. Retrieved from https://digitalre pository.trincoll.edu/cgi/viewcontent.cgi?article=1206&context=facpub Clemente, J. (2019). China is the world’s largest oil & gas importer. Forbes. Retrieved from https://www.forbes.com/sites/judeclemente/2019/10/17/china-is-the-worlds-largest-oil--gasimporter/#21eaef505441 Eder, T. S., & Mardell, J. (2018). The BRI in Pakistan: China’s flagship economic corridor. Merics. Retrieved from https://www.merics.org/en/bri-tracker/the-bri-in-pakistan Gupta, Y. (2019). Belt and roadblocks. The Hindu. Retrieved from https://www.thehindu.com/opi nion/op-ed/belt-and-roadblocks/article29224389.ece Hassan, S. K. (2017). A Pakistani overview of Pakistan-China relations: From geopolitical compulsions to a strengthening co-operation. Retrieved from https://centreasia.hypotheses.org/files/ 2018/03/19-KanwallHassan-ChinePakistan_Juil2017.pdf Hornby, L. (2017). China and Myanmar open long-delayed oil pipeline.Financial Times. Kelemen, B. (2018). China’s twofold CPEC strategy in Pakistan: Present security challenges and future prospects. Retrieved from http://www.asian.sk/wp-content/uploads/2018/09/ChinaPakistan_Kelemen_fin.pdf Notezai, M. A. (2019). Has the China-Pakistan economic corridor stalled? The Diplomat. Retrieved from https://thediplomat.com/2019/10/has-the-china-pakistan-economic-corridor-stalled/ Nurmuhammedov, N. (2017). China-Pakistan economic corridor and its geostrategic importance in terms of Belt and Road Initiative. Afro Eurasian Studies Journal, 6(1 & 2), 34–64. PRC NDRC. (2016). The 13th five-year plan for economic and social development of the People’s Republic of China (2016–2020). Central Compilation & Translation Press. Shams, S. (2019). Has China-Pakistan economic corridor lived up to the hype? Retrieved from https://www.dw.com/en/has-china-pakistan-economic-corridor-lived-up-to-the-hype/a-506 44617 Shams, S. (2019). Belt and Road Forum: Is the China-Pakistan economic corridor failing? Retrieved from https://www.dw.com/en/belt-and-road-forum-is-the-china-pakistan-economic-corridor-fai ling/a-48473486 Shukla, S. (2019). Two phrases critics of China’s BRI must not use—Debt trap & threat to sovereignty. Retrieved from https://theprint.in/opinion/two-phrases-critics-of-chinas-bri-mustnot-use-debt-trap-threat-to-sovereignty/229544/ World Bank. (2017). China’s special economic zones. Retrieved from https://www.worldbank.org/ content/dam/Worldbank/Event/Africa/Investing%20in%20Africa%20Forum/2015/investing-inafrica-forum-chinas-special-economic-zone.pdf Yu, K. (2018). Energy cooperation and regional order in the Belt and Road Initiative: A case study of China’s investment in the China Pakistan Economic Corridor. Retrieved from https://www. kcl.ac.uk/sspp/schools/global-affairs/lapc/lapc-wp-kaho-yu.pdf Zaidi, A. (2017). After OBOR gets ready, Pakistan will become China’s colony. The Economic Times.

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Dr. Sanchita Bhattacharya is Research Fellow in Institute for Conflict Management, New Delhi. She holds her Ph.D. from School of International Studies, Jawaharlal Nehru University, New Delhi. Her research is in the field of Political Islam in the Indian Sub-continent. She also writes frequently on various socio-political aspects of Pakistan. She has extensively published in national and international journals, along with contributions in various edited volumes.

Chapter 10

China’s Belt and Road Initiative and Its Concerns for India Binodkumar Singh

Abstract The One Belt-One Road (OBOR) which was launched in 2013, by the President Xi Jinping was later rechristened as Belt and Road Initiative (BRI). The initiative was portrayed as a benign investment venture with vast benefits. The second BRI Summit was held in Beijing from 25 to 27 April 2019. The Summit was attended by 40 global leaders, including Russian President Vladimir Putin and Pakistan’s Prime Minister Imran Khan, China’s two closest allies. The gathering was larger than the first Summit held in 2017, which had just 29 participants. However, India stayed out of the BRI Summit for the second time on grounds of sovereignty given that the China Pakistan Economic Corridor (CPEC) traverses through Pakistan-occupied Kashmir (PoK). India has turned down official invite from China to attend its BRI forum for the second time. The first time, India boycotted the meeting was in the year 2017. The Indian government has resolutely maintained that Beijing’s BRI project undermines India’s sovereignty in the form of CPEC which runs through the disputed territory of Pakistan occupied Kashmir (PoK) and overrides India’s strategic concerns. Moreover, a few BRI countries had expressed dissatisfaction with the ongoing ventures including Sri Lanka, Malaysia, Myanmar and Bangladesh. India along with the US and several other countries have been highlighting the concerns over the BRI projects, leaving a number of smaller countries in debt traps. The concerns grew louder after China took control of Sri Lanka’s Hambantota port in 2017 on a 99-year lease as debt swap.

Introduction At the end of 2013 Chinese President Xi Jinping announced one of China’s most ambitious foreign policy and economic initiatives. He called for the building of a Silk Road Economic Belt and a 21st Century Maritime Silk Road, collectively referred to as One Belt, One Road (OBOR) which was later rechristened as Belt and Road Initiative (BRI) (Cai, 2017). The official outline for the BRI was issued on 28 B. Singh (B) Institute for Conflict Management, Research Associate, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_10

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March 2015, by the National Development and Reform Commission (NDRC), the Ministry of Foreign Affairs (MOFA) and the Ministry of Commerce (MOFCOM) of the People‘s Republic of China (PRC), with authorization of the State Council. According to the National Development and Reform Commission (NDRC) (2015), BRI aims to “promote the connectivity of Asian, European and African continents and their adjacent seas, establish and strengthen partnerships among the countries along the Belt and Road, set up all-dimensional, multi-tiered and composite connectivity networks, and realize diversified, independent, balanced and sustainable development in these countries”. In fact, BRI was not fundamentally new, but rather built on Chinese overseas infrastructure development activities pursued over the preceding 25 years. This included various energy, transportation, communications, and other projects. Several of these projects were subsumed under the BRI framework, such as a freight line connecting Chongqing with Duisburg, Germany, which opened in 2011, and the Bangladesh-China-India-Myanmar (BCIM) economic corridor, which had been discussed as early as 1999 (Pantucci & Lain, 2017). China was also one of the pioneers to focus on Eurasian development. Since 1992, the European Union (EU) had launched several projects under its Transport Corridor Europe-Caucasus-Asia initiative. In 2011, U.S. Secretary of State Hillary Clinton announced the New Silk Road Initiative to better integrate Afghanistan into the Central and South Asian economies through energy and transportation development. In 2013, Japan’s Shinzo Abe initiated a “revitalization strategy” involving USD110 billion in infrastructure investment over 5 years, while in the same year South Korea’s Park Geun-hye announced a Eurasia Initiative focused on regional economic connectivity (Wuthnow, 2017). All of these programs took place in the context of Eurasia’s growing need for infrastructure spending to support development, which the Asian Development Bank assessed, would require USD1.7 trillion per year between 2016 and 2030 (Asian Development Bank, 2017). Although, the BRI is credited to President Xi, it is the outcome of a long deliberative process—demonstrating the increased pluralism in Chinese foreign policy decision-making. The idea to recalibrate the compass of China’s foreign policy has evolved through a series of workshops, roundtables and meetings. Widening the narrow focus on East Asia was discussed, most importantly, during a “work forum” on Chinese diplomacy toward its periphery held by the Communist Party of China (CPC), from 24 to 25 October 2013. At the work forum, the CCP Politburo Standing Committee attended along with representatives of various departments of Central Committee, State Councillors, the Central Leading Small Group for Foreign Affairs, and a few Chinese ambassadors. The result of these high-level forums was reprioritization of China’s “neighbourhood policies” and “Beijing’s unprecedented focus on periphery diplomacy (Mayer, 2017). BRI emerged after two major events, one economic and the other strategic, and has rapidly become Xi’s signature concept. Not long after Xi rose to the position of vice president of the People’s Republic of China (PRC) in March 2008, China began to feel the aftershocks of the global financial crisis. Shortly after he became vice chairman of the Central Military Commission in fall 2010, the Obama administration announced

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its intention to “rebalance” to the Asia–Pacific. These two events had a profound impact on the Chinese elites’ ongoing assessment of their country’s economic development prospects and external strategic environment. Given the extreme complexity of this environment, Beijing had to “think strategically to turn challenges into opportunities” and to “create favourable conditions” for China’s unimpeded rise (Rolland, 2017). Thus, the BRI is a Chinese initiative of the twenty-first century and is now receiving global attention and scrutiny. Although one could say that BRI’s underlying intention is to revitalize the ancient silk roads, albeit land or maritime based, there is one aspect that makes it fundamentally different from the ancient ones, and that is: it is not “organic”. As such, the BRI places unprecedented demands on China and the Chinese people to shoulder greater global responsibilities. In this sense, BRI is very timely since the world is currently confronted by serious economic challenges. It is hoped and anticipated that by its proper execution, BRI can lift the world out of such molasses (Da-hsuan and Liang, 2019). The uniqueness of BRI was its expansive scope and scale. The centrepiece is a web of six economic corridors linking China with each of its neighbouring sub-regions: (i) The New Eurasia Land Bridge Economic Corridor (ii) The China-MongoliaRussia Economic Corridor (iii) China-Central Asia-West Asia Economic Corridor (iv) China-Indochina Peninsula Economic Corridor (v) China-Pakistan Economic Corridor and (vi) Bangladesh-China-India-Myanmar Economic Corridor. Financing would be allocated by new multilateral institutions such as the Asian Infrastructure Investment Bank (AIIB), with an initial capitalization of USD100 billion, and the USD40 billion Silk Road Fund, in addition to national banks such as China’s Export– Import Bank (“The New Silk Road”, 2015) (Fig. 10.1). So far, two BRI Forums have been held. The second Belt-Road Forum was held in Beijing from 25 to 27 April 2019. The three-day event was organized to promote the “BRI”—President Xi Jinping’s multi-trillion-dollar infrastructure development and investment venture. The Forum was attended by 40 global leaders, including Russian President Vladimir Putin and Pakistan’s Prime Minister Imran Khan, China’s two closest allies. The gathering was larger than the first Forum held in 2017, which had just 29 participants. Among the new entrants were Austria, Portugal, the United Arab Emirates, Singapore and Thailand (Dwivedi, 2019). Since Chinese President Xi Jinping proposed the initiative seven years ago, 126 countries and 29 international organizations have signed BRI cooperation agreements with China (“BRI Journey”, 2019).

Evolution of Perceptions The concept or vision of BRI, presented in autumn 2013 by the Chinese leader Xi Jinping, came as a surprise even in China, which had been following a low-profile strategy proposed by the “father of reforms” Deng Xiaoping for the two previous decades. Simultaneously, it came as an even bigger surprise to the outside world,

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Fig. 10.1 Six economic corridors of belt and road initiative

including USA, Japan, India and the EU, its institutions and member states. No one seemed to be ready to accept a new, assertive and expansive China, proposing its new role as a power centre (Kumar and Góralczyk, 2018). BRI is part of a larger narrative to regain and reinforce the legitimacy of the CCP. The BRI is part of a narrative rather than a concrete plan or project. It is an extension and by-product of a “legitimacy” discourse that has external and internal political applications for the CCP. The CCP heavily relies on the revival of China’s traditional culture and imagined golden past to create a modern narrative of China, and Silk Road narrative, providing a benign narrative for China’s engagement with the world. It is also part of the CCP’s pursuit of non-Western legitimacy for Chinese modernity. The CCP was concerned with the ideological vacuum created following the collapse of the Soviet Union. The CCP feared that the ideological vacuum, compounded with the prospect of an economic slowdown, would result in “ideological infiltration” from the West, threatening its rule (Thaliyakkattil, 2019). Beijing’s current proactive diplomatic agenda impacts far-flung places and exceeds the immediate neighbourhood in the Pacific and Southeast Asia. China’s economic statecraft and the attractiveness of its development model are felt on every level of global economic system. The leadership in Beijing emphasizes that a “peaceful international environment” remains crucial to achieve the “great rejuvenation of the Chinese nation” said to be completed at the 100-year anniversary of the People’s Republic in 2049. At the same time, a new generation of leaders under President Xi Jinping has gradually abandoned Deng Xiaoping’s principle of “biding time while lying low”. Given its fast-growing economic and military capabilities, a

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new “assertiveness” seems to characterize Chinese behaviour in matters of territorial claims, such as in the South China Sea and the pursuit of national interest (Mayer, 2017). Moreover, there has been shifting of emphasis in Chinese investment patterns. What started off as an investment idea in infrastructure and connectivity under OBOR as the Chinese looked at controlling the logistical chain for export capabilities, has gradually transformed into a Chinese policy of encouragement for Chinese companies and entities to acquire “high and new technologies” and “advanced manufacturing capabilities” along with infrastructure investments that can further facilitate Chinese exports. As is known, China is pursuing an ambitious plan, called “Made in China 2025”; aimed at moving the Chinese economy away from the labourintensive and low-value production towards higher value and manufacturing in 10 key industries like electric cars, machine tools, robotics, semiconductors, artificial intelligence, medical technology, railways, aerospace, advanced materials and information technology to become the global leader and kick off the next phase of China’s development (Wadhwa, 2018). As the BRI is only seven years old, its full results cannot yet be judged. However, a preliminary assessment can be offered for BRI projects in South and Southeast Asia, the region described by Chinese leaders as the “main axis” of the BRI. It is here that BRI investment is strongest and has been around longest. The picture is not promising. The hundreds of billions spent in these countries have not produced returns for investors, or political returns for the party. There is a vast gap between what the Chinese have declared they will spend and what they have actually spent. There is also a gap between how BRI projects are supposed to be chosen and how they actually have been selected (Greer, 2018). Prolonged exposure to the BRI process has driven opposition to Chinese investment and geopolitical influence across the region. In August 2018, Malaysian Prime Minister Mahathir Mohamad announced he will shelve two major infrastructure projects by Chinese companies for being too expensive for his debt-ridden country. One of the projects, dubbed the East Coast Rail Link, would have connected the South China Sea with strategic shipping routes in Malaysia’s west, providing an essential trade link. The other was a natural gas pipeline in Sabah, a Malaysian state on the island of Borneo (Beech, 2018). In the Maldives, talking about reviewing contracts awarded by the previous President Abdulla Yameen, Maldives’ new Finance Minister Ibrahim Ameer on 26 November 2018 said “We believe that most of these projects are at inflated prices, and so we are looking at them” (Miglani, 2018). In December 2018, the Pakistan government decided to shelve a major coal-based power plant project under the USD60 billion China-Pakistan Economic Corridor (CPEC), citing sufficient generation capacity already lined up for the next few years. The project was originally pushed as an imported coal-based plant by Quaid-i-Azam Thermal Company of the Punjab government led by former Chief Minister Shahbaz Sharif (Khan, 2019). In Nepal, warning the Government against debt trap, on 10 October 2019, the Opposition parties urged the Government not to accept offers of loan for the construction of the proposed Kathmandu-Kerung railway. During a meeting with former

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Prime Ministers, Ministers and other dignitaries held at the behest of Prime Minister K.P. Oli, Nepali Congress (NC) President Sher Bahadur Deuba asked the Government not to take loan to build the railway. The government, Deuba said, should take forward the railway project only if China agrees to build it through grant (“Opposition parties warn govt against debt trap”, 2019). Similarly, in August 2018, Myanmar’s government also cut down the price for a Chinese-backed deep-water port in the conflict-ridden state of Rakhine from USD7.3 billion to USD1.3 billion, citing concerns the initial cost would leave the Southeast Asian nation in a lot of debt (“Myanmar scales back Chinese-backed port project”, 2018). Marking another pushback against China, in July 2020, Myanmar government decided to involve international partners in the Chinese-funded mega Yangon City Project, a key pillar of the BRI, as it is not keen that one single company dominates the mega project (Chaudhury, 2020). Chinese companies also have a history of allegations of fraudulent and gross financial malpractices. In January 2009, the World Bank barred seven firms, including China State Construction Corp., from bidding on future contracts for their alleged effort to rig bids to in a major road construction project in the Philippines (Davis, 2009). In January 2018, the Bangladesh government blacklisted China Harbour Engineering Company Limited for trying to bribe a roads secretary. The government had signed a contract on 9 October 2016, with the firm to develop the two-lane DhakaSylhet Highway to a four-lane one and set up a service lane, among other projects it was awarded in the country (“Bangladesh blacklists China Harbour Engineering”, 2018). Once again, in June 2019, the World Bank banned Chinese companies for financial crimes. It was nine-month debarment of China Railway Construction Corporation Ltd., a Chinese, state-owned construction and engineering company, and its wholly-owned subsidiaries, China Railway 23rd Bureau Group Co., Ltd. and China Railway Construction Corporation (International) Limited, in connection with misconduct under the East–West Highway Corridor Improvement Project in Georgia (Oliver, 2019). Since it was inaugurated in 2013, the BRI has come under scathing criticism from across the world, including the participating countries, due to lack of financial authority and weak environmental standards. Lack of transparency in loan repayment terms, difficulties in accessing finance and poor environmental standards are all making all these countries re-think their strategy. According to a report by The Economist Intelligence Unit, since April 2018, several BRI projects have encountered delays, suspension, or outright cancellations “due to scepticism and pushback against the project” (“Belt and Road Initiative Quarterly”, 2018). Similarly, one analysis of 173 BRI projects by Centre for Strategic and International Studies (CSIS) in 2018 concluded that with the exception of the CPEC there appears to be no significant relationship between corridor participation and project activity suggesting that interest groups within and outside China are skewing President Xi’s signature foreign policy vision (Hillman, 2018). The BRI seems to be downshifting. According to Chinese government data, China’s overseas investment growth is in decline, peaking at 49.3 per cent yearon-year growth in 2016 and then retracting by 23 per cent in 2017 and another 13.6

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per cent in 2018. In the first half of 2019, Chinese FDI rose a mere 0.1 per cent Moody’s, the international credit rating agency, predicts that this downward trend will continue over the coming years due to an “increased awareness” of the risks that both partner countries and China itself take when engaging in such large-scale development in risky, unproven markets (Shepard, 2020). Of late, the BRI projects have also been hit by the Covid-19 pandemic. Briefing the media in Beijing on 19 June 2020, on the outcome of the “High-level video-conference on Belt and Road international cooperation” held on June 18, a senior Chinese official said a survey showed that about 20 per cent of projects under the BRI are “seriously affected” by the pandemic while 30 per cent—40 per cent are impacted at various degrees (Foon, 2020).

India’s Concerns The BRI often touted as China’s most prestigious regional and global economic programme is in essence one of the personal initiatives of Xi Jinping. While most countries participating in the BRI consider it a great project, India has expressed serious reservations about BRI and has refused to be part of it not only in the region but elsewhere too. India does not see the BRI as a purely economic initiative but considers it as a security and strategic agenda by Beijing which is cleverly camouflaged as an economic partnership engagement. It has also indicated the assumption of China’s probable leadership for the world (Kumar and Góralczyk, 2018). To best understand India’s concerns, it is helpful to examine four specific corridors that constitute major components of the BRI and run through India’s South Asian neighbourhood: the CPEC, the BCIM Economic Corridor, the Trans-Himalayan Economic Corridor, and the Maritime Silk Road. These four corridors and the infrastructure projects associated with them have a direct bearing on India’s strategic interests. They run close to India’s continental and maritime borders and are affecting its security interests and strategic environment. China’s engagement with India’s immediate neighbours through these corridors threatens to alter existing power dynamics in the region. A primary concern for New Delhi is that Beijing will use its economic presence in the region to advance its strategic interests. One notable example is the strategically located port of Hambantota, which the Sri Lankan government was forced to lease to China for 99 years in 2017. The port was built using Chinese loans but, due to the high interest rates, Sri Lanka was unable to repay and incurred a burgeoning debt burden (Baruah, 2018). Just hours before the first BRI Forum was due to open in Beijing, India’s Ministry of External Affairs issued a comprehensive statement on May 13, 2017, on its objections to the BRI. The statement highlighted issues of transparency, environmental protection, economic feasibility and technology transfer associated with the BRI (Ministry of External Affairs, 2017). The Indian government was the first government to highlight the many shortcomings of the BRI. India’s main objection is on the principle that the BRI includes projects in the CPEC that are located in the

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Pakistan-occupied Kashmir (PoK)’s Gilgit Baltistan, including the Diamer Bhasha Dam, 180-MW hydel power projects, and more expressways and economic zones along the Karakoram Highway built in the 1970s (Haidar, 2017). For the second time, in April 2019, India rejected China’s invitation to attend BRI Forum owing to its concern over CPEC project. The Indian government resolutely maintained that Beiing’s BRI project undermines India’s sovereignty in the form of CPEC which runs through the disputed territory of PoK and overrides India’s strategic concerns. In response to a question about India’s concerns over the BRI and whether India would take part in the second BRI Forum, India’s Ambassador to China Vikram Misri in March told the state-run Global Times that, “No country can participate in an initiative that ignores its core concerns on sovereignty and territorial integrity” (Parashar, 2019). Once again, replying a question on possibility of India participating in China’s BRI in an interview with Strait Times, on 8 September 2019, in Singapore, India’s External Affairs Minister Dr. Subrahmanyam Jaishankar reiterated “We have issues with China-Pakistan Economic Corridor (a BRI project) especially with parts which lie in neither China nor Pakistan but in India. It goes through an illegally-occupied part of the Indian state of Jammu and Kashmir. This has been done without consent of India. As far as we are concerned clearly violates our sovereignty. The question I ask people is what would you do if your sovereignty was violated?” (Garekar and Yong, 2019). Significantly, on 10 September 2019, calling on China and Pakistan to stop activities related to the CPEC in PoK, India’s Ministry of External Affairs spokesperson Raveesh Kumar said “India has consistently expressed concerns to both China and Pakistan on the projects in so-called ‘China Pakistan Economic Corridor’, which is in the territory of India that has been illegally occupied by Pakistan since 1947. India is resolutely opposed to any actions by other countries to change the status quo in Pakistan occupied J&K. We call on the parties concerned to cease such actions” (Bhattacherjee, 2019). Reiterating New Delhi’s longstanding position on the BRI, on 4 October 2019, India’s External Affairs Minister Jaishankar shot down speculations on whether India would copy China’s BRI. Responding to a question on the same, Jaishankar said at an interactive session at the World Economic Forum (WEF), “We are us and not just some other country. It’s not just in this initiative but in whole lot of areas. My own sense is as India becomes bigger; we will find concepts developed for other countries won’t necessarily apply to us. It’s not very likely we’ll copy models from others. We have a longstanding position on that. It is connected with sovereign matters. That has not changed” (“India won’t join BRI”, 2019).

India’s Responses Connectivity is increasingly seen as a tool for exerting foreign policy influence. This view is reflected at the highest levels of diplomacy by countries like India, Japan,

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and the United States that have issued strong remarks about connectivity and infrastructure. Given the geopolitical stakes and India’s reservations about how China’s BRI connectivity projects are currently being pursued and the strategic advantages they may confer, there is likely little scope for the two countries to collaborate on the BRI. India perceives efforts to enhance interconnectedness as a new theatre for geopolitical competition with China in South Asia and the Indian Ocean. At the same time, connectivity also presents India with an opportunity to re-establish its regional primacy (Baruah, 2018). Understanding the motivations behind China’s BRI has always been a complicated task at a time when China has been showing its assertiveness across the globe as well as reflecting its strategic ambitions to be accepted as the world leader. Hence, it cannot be assumed that China’s BRI is merely for economic reason and connectivity. It is much beyond economics and dwells into the geopolitics part of it largely. India seems to have understood the game plan of China and for various geopolitical reasons; it has kept itself away from becoming a part of it (Kumar and Góralczyk, 2018). India has undertaken various measures to strengthen its relations and facilitate greater participation in Association of Southeast Asian Nations (ASEAN) activities through a transition from the Look Eat Policy to the Act East Policy, which aims at expanding its economic, security and diplomatic ties with ASEAN, including its trade and investment ties with Japan and South Korea. The Act East Policy has seen positive response from South Korea. President Moon Jae-in on 30 June 2019 voiced support for the Indo-Pacific Strategy, saying it can work with his own New Southern Policy focusing on Southeast Asia (Kim, 2019). India’s Act East policy is slowly becoming Act Indo-Pacific policy under Modi government. India has placed the Indo-Pacific at the heart of its engagement with the countries of south, southeast and east Asia (De, 2020). India is also collaborating with Iran to establish strategic cooperation. India started interacting with Iran on Chabahar port, increasingly seen as a counter to Pakistan’s Gwadar port located at distance of around 80 km from Chabahar, around 2003. The first phase of the Chabahar port was inaugurated in December 2017 by Iranian president Hassan Rouhani, opening a new strategic route connecting Iran, India, and Afghanistan bypassing Pakistan. Finally, on 24 December 2018, India has taken over operations of the strategic Chabahar Port during a trilateral meeting of officials from India, Afghanistan and Iran. This is the first time India will be operating a port outside its territory (“Chabahar port begins commercial operations”, 2019). India has also launched “Project Mausam”, which could potentially be India’s answer to China’s Maritime Silk Route. India aims to restore its ancient maritime routes and cultural links with republics in the Indian Ocean Region. The project envisages the re-establishment of India’s ancient maritime routes with its trade partners along the Indian Ocean. The project proposes to determine the vast Indian Ocean world expanding from East Africa, the Arabian Peninsula, the Indian subcontinent and Sri Lanka to the South East Asian archipelago. This project is an attempt to counterbalance China’s Maritime Silk Route by leveraging India’s ancient connections with the region (Haldar, 2018).

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India has plenty more connectivity projects too, either by itself or in cooperation with friendly countries. It is involved in a spate of projects in Afghanistan like the USD135 million Zaranj-Delaram highway and the USD290 million AfghanistanIndia Friendship dam in Herat province. New Delhi has invested around USD3 billion in Afghanistan, making it one of its biggest international donors. At the same time, private Indian players are also chipping in by moving into newer markets in Southeast Asia and Africa. Indian automobile companies like Mahindra & Mahindra have expanded into Africa while companies including Tata Motors, TVS Motor and Bajaj Auto have moved into Southeast Asian markets (Borah, 2019). India is also one of the most important advocates of the concept of “Indo-Pacific Strategy”. India can take this opportunity to promote the justification and rationalization of its interests in Southeast Asia; expand its presence in East Asia, strengthen its political, economic and military cooperation with the United States and its allies, and comprehensively increase India’s influence in international affairs. Broadening the scope of cooperation in the Indo-Pacific region, India’s External Affairs Minister S Jaishankar on 26 June 2019, said that India will engage with like-minded countries to ensure rules-based order in the Indo-Pacific against China’s belligerence while simultaneously indicating to the US that India does not want to paint China as an enemy (Chaudhury, 2019). Separately, outlining India’s re-balancing strategy to counter China’s BRI, Minister of State for External Affairs V Muraleedharan on 26 June 2019, informed the Lok Sabha (Lower House of Parliament) “As part of the Government of India (GoI) Lines of Credit (LoCs) programme, 279 LoCs have been extended to 63 countries of Asia, Africa, Latin America, Caribbean, Oceania and Commonwealth of Independent States worth nearly USD 28 billion. Of this, 254 projects aggregating nearly USD 4.70 billion have been completed, while 194 projects worth nearly USD 19 billion are under implementation. These include 94 connectivity projects in five countries in India’s immediate neighbourhood being taken up with GoI LoC worth nearly USD 6.6 billion” (Lok Sabha, 2019). Recently, in August 2020, India has committed to help construct the Maldives’s biggest civilian infrastructure project that will connect the capital Male with three neighbouring islands Villingili, Gulhifahu, and Thilafushi with a 6.7-km bridge and causeway. The plan is part of India’s commitment to invest USD100 million as a grant to develop the Greater Male Connectivity Project (GMCP). India will also provide a USD400 million LoC to the Maldives (Sharma, 2020). Similarly, in September 2020, India has offered Sri Lanka a LoC worth USUSD 100 million for three solar projects. This LoC will cover financing for rooftop solar systems meant for 20,000 households and 1,000 government buildings all across the island. The combined generation capacity of these rooftop systems will be about 60 MW (“India offers Sri Lanka USD 100 million LoC”, 2020).

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Conclusion The BRI, Beijing’s signature foreign policy program, is China’s attempt to stretch its economic power across the globe through the construction of maritime and overland transportation links across Asia, the Middle East, Africa and Europe. The concept sets the general long-term direction for China and seeks to mobilize and coordinate the use of all available national resources to pursue internal and external objectives in an integrated way. BRI is also the tool to keep Chinese export-led economy running, by shifting focus to South-South trade, in the wake of economic slowdown of the West. Beijing wants to use BRI to up the ante in the Indo-Pacific Region, by ensuring that economic and thus, political interests of regional countries are aligned with its geo-political interests. However, India has taken an in-principle stand against BRI over CPEC which is the flagship project of BRI. The principle opposition of India to CPEC is about the core concerns on sovereignty and territorial integrity, as major infrastructure projects are implemented in PoK. India also confronts growing Chinese assertion in Indian Ocean Region. China’s BRI, therefore, challenges India to reconsider the whole gamut of its foreign policy objectives, strategies, and structures as well as its internal structures of administration, including centre-state relations. Meanwhile, amid worries over high project costs, nations including Pakistan, Myanmar and Malaysia have cancelled or backed away from previously negotiated BRI commitments in recent months. To avoid the same fate as Sri Lanka which had to hand over a strategic port to Beijing in 2017 when it couldn’t pay off its debt to Chinese companies many of these governments have taken precautions. India along with the USA and several other countries have been highlighting the concerns over the BRI projects, leaving a number of smaller countries in debt traps. For India, regional balancing is the best bet to balance a rising China, without becoming a pawn in the ‘Grand Game’. As the BRI and other connectivity projects transcend competition and other diplomatic interactions between China and India bilaterally, in their neighbourhood, and on a global scale will scale up in the future. India has to choose from a diverse range of options to achieve the national and global objectives. India can coordinate with USA, Japan and Australia as they also aim to counter Beijing’s growing assertion by aligning with New Delhi. India should utilize all the opportunities available to comprehensively increase its influence in international affairs.

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India won’t join BRI, its concept won’t apply to us: Jaishankar. (2019). Business Standard. https://www.business-standard.com/article/news-ani/india-won-t-join-bri-its-conceptwon-t-apply-to-us-jaishankar-119100400767_1.html Khan, O. F. (2019). Pakistan asks China to remove power project under CPEC. The Times of India. https://timesofindia.indiatimes.com/world/pakistan/pm-khan-asks-china-to-rem ove-power-project-under-cpec/articleshow/67529027.cms Kim, S. (2019). Moon signs onto trump indo-pacific strategy. Korea Joongang Daily. http://koreaj oongangdaily.joins.com/news/article/article.aspx?aid=3064972 Kumar, A., and Góralczyk, B. J. (2018). China’s belt and road initiative (BRI): India’s and EU’s perspectives. EU-India Think Tanks. https://euindiathinktanks.com/wp-content/uploads/2019/ 01/China%E2%80%99s-Belt-and-Road-Initiative-BRI-India%E2%80%99s-and-EU%E2%80% 99s-Perspectives-Poland-Manipal.pdf Lok Sabha. (2019). Question No.849 One Belt and One Road Initiative. Government of India. http:// loksabhaph.nic.in/Questions/QResult15.aspx?qref=961&lsno=17 Mayer, M. (2017). Rethinking the silk road: China’s belt and road initiative and emerging Eurasian relations. Palgrave Macmillan. Miglani, S. (2018). Maldives says China is building projects at inflated prices. Reuters. https:// in.reuters.com/article/maldives-politics-china/maldives-says-china-is-building-projects-at-inf lated-prices-idINKCN1NV1YF Ministry of External Affairs. (2017). Official Spokesperson’s response to a query on participation of India in OBOR/BRI Forum. Government of India. https://mea.gov.in/media-briefings.htm? dtl/28463/Official+Spokespersons+response+to+a+query+on+participation+of+India+in+OBO RBRI+Forum Myanmar scales back Chinese-backed port project over debt fears. (2018). The Guardian. https:// www.theguardian.com/world/2018/aug/02/myanmar-scales-back-chinese-backed-port-projectover-debt-fears National Development and Reform Commission (NDRC). (2015). Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road. http://en.ndrc.gov.cn/ newsrelease/201503/t20150330_669367.html Oliver, Julia. (2019). World Bank Group Debars China Railway Construction Corporation Ltd. and two subsidiaries. Press release. World Bank. https://www.worldbank.org/en/news/pressrelease/2019/06/05/world-bank-group-debars-china-railway-construction-corporation-ltd-andtwo-subsidiaries Opposition parties warn govt against debt trap. (2019). Republica. https://myrepublica.nagarikne twork.com/news/opposition-parties-warn-govt-against-debt-trap/ Pantucci, R., and Lain, S. (2017). China’s Eurasian pivot: The silk road economic belt. Whitehall Papers. London: Royal United Services Institute (RUSI). https://rusi.org/publication/whitehallpapers/chinas-eurasian-pivot-silk-road-economic-belt Parashar, S. (2019). For the second time, India declines China’s invite for BRI forum. The Times of India. https://timesofindia.indiatimes.com/india/for-the-second-time-india-declines-chi nas-invite-for-bri-forum/articleshow/68769033.cms Rolland, N. (2017). China’s Eurasian Century? Political and strategic implications of the belt and road initiative. NBR Books. Sharma, S. (2020). India plans to outbuild China in the Maldives. Asia Times. https://asiatimes.com/ 2020/08/india-plans-to-outbuild-china-in-the-maldives/ Shepard, W. (2020). Is China’s belt and road already in retreat? Forbes. https://www.forbes.com/ sites/wadeshepard/2020/01/30/is-chinas-belt-and-road-already-in-retreat/#ed9380c5ebef Thaliyakkattil, S. (2019). China’s achilles heel: The belt and road initiative and its indian discontents. Palgrave Macmillan. The New Silk Road - Foreign investment. (2015). The Economist. https://www.economist.com/spe cial-report/2015/09/10/the-new-silk-road Wadhwa, A. (2018). Chinese investments in Europe, analysis no. 57. Institute of Chinese Studies. https://www.icsin.org/uploads/2018/05/25/866ba263bacfd98e2a8beebf52684e37.pdf

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Wuthnow, J. (2017). Chinese perspectives on the belt road initiative: Strategic rationales, risks, and implications. Center for the Study of Chinese Military Affairs. https://inss.ndu.edu/Portals/68/ Documents/stratperspective/china/ChinaPerspectives-12.pdf

Dr. Binodkumar Singh A Research Associate at Institute for Conflict Management (ICM), New Delhi since January 2012. He has done his Ph.D. on “Indo-Bangladesh Relations: Their Impact on the Security of the North East” from the Department of Defence and National Security Studies, Punjab University, Chandigarh. Currently, he is involved in research and documentation of Conflicts in Bangladesh. At ICM, apart from his primary area, that is Bangladesh, he has been following Nepal for the past nine years and has published many articles. He frequently contributes articles at different platforms such as South Asia Monitor.

Chapter 11

China’s Maritime Ambition in South Asia vis-à-vis Bangladesh: A Concern for India? Hoimonti Barua

Abstract In November 2016, Bangladesh purchased two diesel-electric submarines from China at a cost of USD203 million causing its immediate neighbor India substantial anxiety. The maritime dispute between Bangladesh and two of its maritime neighbours—Myanmar and India were resolved in 2012 and 2014 through international arbitration. However, Bangladesh now sees an opportunity to develop ocean economy in the world’s largest Bay. Bangladesh supposedly does not encounter any conventional maritime-military threats therefore the induction of submarines in its navy draws attention of India particularly due to Chinese involvement. The strategic interest of China has changed considerably over the last two decades. After having established in economic, political and military China’s ambition now is to establish a permanent maritime base in the Indian Ocean region. The Bay of Bengal is essential for India as it provides significant leverage against rivals and helps in addressing the security matters that directly intimidate Indian interests. Therefore, China’s consistent efforts to institute a South Asian presence are pivotal in terms of strategic implications. The Chinese strategy is to forge maritime ties with nations like Bangladesh, Sri Lanka and Myanmar through initiatives like the Maritime Silk Route, Belt and Road Initiative (BRI) and investments on infrastructures. Being the largest and strongest country in South Asia, India has been helping the smaller countries but China has an unambiguous advantage over India due to vast cash reserve amassed of its huge trade surfeit. The policy of China in the South Asian region has a mix of strategic as well as opportunistic aspects. China has been traditionally a continental land power but has changed its interest on becoming a sea power therefore venturing far off seas which poses more like a paradigm shift. Against this backdrop, this paper is an attempt to study Chinese interest in the maritime zone of Indian Ocean region which will progress in three stages. Firstly, following China’s post-Cold War objectives to grow as the mighty power in the sphere of politics, security and economy, the paper explores its interest in enhancing the maritime power. Secondly, the paper particularly focuses on China’s strategic interest in involving with Bangladesh. The paper concludes by analyzing the implications of Beijing’s

H. Barua (B) Research Fellow, Centre for Research and Development, Bangladesh, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_11

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approach to build a Sino-centric maritime environment in the Indian Ocean vis-à-vis Bangladesh on India.

Introduction In the twenty-first century global world, the ascent of China as one of the most powerful nations is an irrefutable fact. China’s rise is pushing it towards its goal of achieving the status of a superpower. In the recent decade one of the salient developments in this region has been China’s exponential economic growth and its capability to fund infrastructural projects in Asia and beyond Asia. This increasing influence led China to become the second-largest economy of the world. Beijing’s economic advancement has been understood by its capacity to become the largest trading partner with many Asian countries as well as the rest of the world. However, some of its recent infrastructural schemes suggests a larger approach, which has the potential of becoming a game-changer in this region. The strategic interest of China has changed considerably over the last two decades especially post-Cold War. After achieving success in political, economic and military growth and surpassing the status of a regional power, China is now determined to become a global power (Egberink and Putten, 2011). Khurana (2008) posits its potential to challenge world super-power like the United States of America. Advancing from successful economic, political and military pursuits Xi’s ambition is to establish a permanent maritime base in the Indian Ocean region. China has had a deep aspiration since the mid-1970s to wield its ascendancy in the Indian Ocean Region. A clear ambition of developing into a regional naval power or “maritime great power” a term often used by President Xi Jinping of China reflects in the rhetoric of fortifying their national policies. Persistent to establish itself in the IOR, Beijing’s presence has been axiomatic in the last two decades. China has been a continental land power for a long time, but has shifted its interest on becoming a sea power, therefore venturing towards far off seas which appear to be a paradigm shift. China is positioning a blue-water navy to realize this intent, capable of governing the proximate seas, contend and conquest regional wars, secure its high-priority sea lanes and secure its sundry politico-economic interests out with East Asia (Mastro, 2020). This ambition has altered its bilateral relations with other big security actors of Asia-one of them being India. China’s interest in South Asia is not a novel arising. The country has made repeated approaches to the region ever since its constitution in 1949 (Wolf, 2014). South Asia’s positioning as a region has geo-strategic value that has attracted great powers since time immemorial. China being a close neighbor is not devoid of this interest. As a power aspiring nation, it feels the need to have friendly and cooperative ties to gain political supremacy and heighten economic hold. The dialogues regarding China’s aim to strengthen its global aspirations emphasized primarily on its coercive nature in South East Asia particularly with regards to the South China Sea. But in some of the South Asian countries such as Bangladesh, Pakistan, Sri Lanka, and Maldives

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and Myanmar, China has shown active interest by indulging itself economically, diplomatically as well as security-wise. Now, it is the “biggest trading partner” (Lin and Gertner, 2015) to most of the Asian states like India, Bangladesh, Sri Lanka, Pakistan, South Korea, Japan, Vietnam and few others.1 The aftermath of the Cold War saw a change in China’s South Asia foreign policy from an international geo-political angle. The policy of China in the region is a synthesis of strategic as well as expansionist. China has had close relations with Pakistan for many decades. The Chinese leaders have shown substantial interest and sought to strengthen its ties with Bangladesh with deeper intensity by becoming their trade partner, investing on infrastructures, providing economic aid and supplying arms. This special attention on South Asia particularly when India too is striving to be a regional power throws implication in terms of security, stability, regional balance of power, maritime security, maritime safety, etc. (Khurana, 2008, pp. 1–39). This chapter explores China’s maritime endeavor in the Indian Ocean region visà-vis South Asia since it assumed the policy of “China Dream” and “opening up to the outside world” in the seventies (Wei, 1995, p. 74).2 In the wake of a new era after the Cold War, following China’s target to nurture its potentials to evolve as a mighty power this paper attempts to analyze its neoteric concentration in enhancing the maritime power. Keeping China’s interest in Bangladesh at the cynosure, the paper focuses and probes into the possible ramifications of Beijing’s approach to shape up a Sino-centric maritime environment in the Indian Ocean vis-à-vis Bangladesh on India. Chinas growing naval capabilities around the South Asian region situated by the Indian Ocean have had India’s concern growing as it looks like China is building a series of naval bases around this region and surrounding India in a way. Since the first half of the nineties, China has been trying to coax Pakistan, Sri Lanka, Maldives, Bangladesh and Myanmar to permit them the right to operate from their ports for military purpose or convince them to let China build naval bases to help China secure their strategic lines of communication through ocean routes. A strategic diagram that has popularly came to be known as China’s “String of Pearls”3 strategy (Upadhyaya, 2017, p. 68; Rehman, 2010). The objectives of the study are: first, to recognize the importance of rim of Indian Ocean and South Asia in terms of Chinese maritime ambition, second, to examine China’s growing interest in Bangladesh, particularly from maritime perspective and third, to analyze these developments and its potential impact on India’s South Asian power aspirations on both land and sea. The objectives will be achieved based on the following questions: ● What is the general understanding and importance of maritime strategy in the field of international relations? ● What is China’s idea and need for maritime strategy? ● How and why is China interested in South Asian and the Indian Ocean Region? ● What interests China in Bangladesh from a maritime viewpoint? ● Why is India uneasy at China’s friendly approach to South Asia vis-à-vis Bangladesh and the possible implications?

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China’s behaviour towards maritime approach has been drawing the attention of experts, scholars, academicians, politicians in both Western as well as Eastern worlds. Experts and strategic analysts are trying to interpret the impetus of this growing interest of Beijing in this matter (MacDonald, 2013) and unravel the quiescent urge of action and the future ambit it might possibly hold.

Importance of Maritime Zone in Global Politics Oceans are physiographic4 divisions on the surface of the earth which in recent times plays increasingly far-reaching roles in the international system (Fernando, 2012). The oceans waterways, with the advancement of technology serve as “sea lines of communication” and promote international trade. The vast oceanic space is not only gigantic repositories of marine resources (living/non-living) but also serves as passage-zone for the world, enhances foreign trade, maritime trade and commerce, thus holds an important place from geopolitical and geostrategic point of view. “Maritime strategy”, “maritime security/safety”, “sea-power”, “blue-economy”, etc., are the latest jargons in the international relations scenario. Maritime-related matters have become geostrategic lynchpin to major world leaders involved in ocean governance, maritime policy and international security therefore, started to reframe and incorporated these in their mandates and policies since the past decades (Bueger, 2015). It holds transnational significance; hence nation-states around the world are prioritizing their maritime politics to one another. Using maritime space for military purpose, nonetheless by one country or group of countries against another country or group of countries looks bears threatening consequences for national security. The UN Convention on the Law of the Sea (UNCLOS) established in 1982 and brought to force in 1992 is said to be the most complex and by far the largest treaty concluded to initiate fundamental legal principles (Council for Foreign Relations, 2013). It is an initiative to provide a set of rules, rights and regulations, responsibilities and jurisdiction to states in order to enable peaceful and systematic management of the ocean-space in the interest of all countries.5 As countries improve their national economy linking with international economy it increases the importance of economic Sea Line of Communication. In Asia, the more the countries prosper economically, the more likely they would require energy to be sourced majorly from the MiddleEast shipped using the Sea Line of Communication that connect these region. In case of Asia, the Indian Ocean region’s Sea Line of Communication plays a pivotal role. In a changing Asia, on the one hand there is China whose demand for energy from the Middle East in on a rapid rise, and on the other is India who has been the sole player in South Asia (before the Chinese started to show their interest in this region), the contestation over the priority of the Indian Ocean demands evaluative deliberations.

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China’s Idea of Maritime Ambition There are some ongoing interests and activities in Asia between the two emerging giants-China and India which are proving to be sources of contestations and competition. Previously, ocean domains were matters of peripheral interest to China which has visibly shifted to being a vital one in the last three decades. After the Cold War international community was going through metamorphosis by shifting towards globalization which interconnected the nations to one other making them dependent on seaborne trade. Tuan Pham said, “China’s maritime activities are driven by its strategic vision of the ocean as ‘blue economic space and blue territory’, crucial for its national development, security, and status” (Pham, 2016). In order to conduct import– export of necessary goods, the best option was to avail the sea-routes. Flowing at the same direction of transformation, China also followed its grand strategy to move from being a land power to sea power. The ancient China being a continent-oriented land power had little knowledge on ocean system. But gradually, China decided to move ahead to become seawards security from landward security by fortifying its maritime capacity and naval force. Now, the quest to increase maritime power and rights over maritime zone is of paramount importance to the Chinese leaders. According to Ji and Xu (1991, p. 137) “territorial and economic concerns have been major factors driving the navy to waters far beyond its usual inshore areas of activity”. In order to achieve that superiority, expansion of maritime territory and establish naval base a global strategic design must be developed. The strategic operation undertaken by Beijing by expanding the naval power is not only to secure their maritime environment but is to reinforce economic security, regional status and international power. Post-Mao-era, the People’s Liberation Army-Navy (PLA-N) led by Deng Xiaoping went through modernization and altered the maritime approach from being Maoist coastal defense strategy to turn into an offshore active defence to eventually become a capacity for a blue-water maritime power. The grand plan therefore is to strategically establish the PLA-N from brown-water navy to a blue water-navy. It can be posited that the Chinese leaders of the twenty-first century are moving towards this direction. China’s maritime ascent evidently confronts regional security. Ergo, the sea-change in their representation of maritime policies has caused much international world worried.

Indian Ocean Region and Strategic Importance of the Bay of Bengal The Indian Ocean (IOR) is rising significantly as the centre-stage for world politics. It is the third-largest water bodies in the world occupying at least one-fifth of the total ocean space by touching Bay of Bengal near Bangladesh, Myanmar and Indonesia in the Eastern Indian Ocean, Africa and the Middle East’s Arabian Peninsula in the Western Indian Ocean and the coastal water of India in the Central Indian

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Ocean turning it into a multifaceted transit region for inter-continental movement for multifarious purpose like economic (transportation of goods, energy, etc.), and security(military/non-military, etc.). During the nineteenth and the twentieth century, the focus and strategic significance on Atlantic and the Pacific Oceans were of utmost importance in politics and economy which has now in the twenty-first century shifted to the Indian Ocean being the principle water route for trade, commerce and security. Multilateral security cooperation in the Indian Ocean should focus on the northern part of the Indian Ocean, consisting of the Bay of Bengal and the Arabian Sea. The Bay of Bengal is a sub-region of the Indian Ocean maritime region to the east of South Asia, and the Arabian Sea is a sub-region of the Indian Ocean maritime region to the west of South Asia. The Arabian Sea is situated between the continental subregions of South Asia and West Asia (or the Middle East). The Bay of Bengal is situated between the continental sub-regions of South Asia and Southeast Asia. The IOR is a crucial conduit for international trade. Its geo-strategic and economic significance has generated dissension in strategic interest inflicted power confrontation among regional and extra-regional powers ensuing implications for small littorals like Bangladesh. The growing power of India and China, the worth of the Sea Lanes of Communication (SLOC), chokepoints, reliance on hydrocarbon resources and frenzied security environment is considered an area of vital geostrategic implication. At the same time, big powers, other extra-regional powers and the proliferation of non-traditional threats by non-state actors are also governing the regional affairs to a great extent (Michel & Sticklor, 2012). Sweijs et al., of the Hague Centre for Strategic Studies refer this as “new centre of economic gravity” as it provides critical sea-trade routes and binds the economic fortuity of Middle East, South Asia with a broader Asian continent in the east, US, Africa and Europe to the west (Sweijs et al., 2010). The Indian Ocean is comprised of enormous littorals, having some of the fastest growing regions of the world and dense population. Jaishankar (2016) categorises the importance of the Indian Ocean rim by three reasons: i. ii.

iii.

The strategically placed location is at the crossroads of global trade, connecting the major players of international economy. More than being just a commercial conduit it has massive drainage basin, accommodates two billion people, creates opportunities for them. This results to high-rate economic spur to countries around the Indian Ocean rim like India, Bangladesh, South East Asia, South of Africa and other South Asian countries. The Indian Ocean Region stores natural resources in abundance.6

Presence of maritime rivalry is heavily felt in the Indian Ocean which indicates the reinstating of great powers in the international politics. Besides being a zone of trade and economic growth, the Indian Ocean Region has turned into a power testing space for both India and China. China’s ascent in the maritime security domain of Asia has evoked India’s interest and awareness to assess its strategic resolutions and review its maritime policy (Baruah, 2015). As emerging power contenders of Asia, both the countries are prepared to amplify their naval existence in this region and their past relationship is raising mutual suspicions and mistrust.

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Why China Needs Indian Ocean Region China’s economy has spurred massively over the last decade. The export-imports of goods climbed to USD 4.16 trillion in 2013 and in 2015 the trade surplus was USD 46.5 billion placing it at the second position of surplus economy of the world. In September 2013, for the first time, making a historical record China surpassed the United States of America by becoming the world’s largest net importer of petroleum and other liquid fuels. As a matter of fact, more than 85 percent of this energy trade takes place in the Sea Line of Communication of the Indian Ocean through the Malacca Strait-a slim chokepoint as narrow as 1.5 miles. Much as the chokepoint is crucial for China, the thinness of the route not only laggards the export–import movement but also creates opportunities for sea pirates and other types of threats. The Chinese manufacturing industry requires at least 9.71 million barrels of oil approximately on a daily basis. The ginormous amount of oil is acquired from the Middle Eastern countries like Saudi Arabia, Iran, Iraq, Oman; African country Angola through the Strait of Hormuz, another choke-point of Indian Ocean (Upadhyaya, 2017). China is conscious of the fact that its uninterrupted growth depends on a protected Sea Line of Communication for the supply of its raw materials besides expanding its maritime trade and perpetuates its reach to the global markets. As all these raw materials (oil, mineral resources, etc.) are sent to China through the SLOC, the Indian Ocean plays an extremely crucial role in the economic activities of China. China became Africa’s largest trade partner during the last decade (Christian Science Motor, 2014). It sourced oil, raw materials7 and natural resource from various African countries8 for industrial purpose. All these products from Africa, the Middle East and South America, travel across thousands of kms. crossing the Indian Ocean for weeks at a stretch to reach the world’s biggest manufacturing nucleus in China. Therefore, choking the Malacca strait would not only clog the supply of Chinese oil and natural resource, but would also prove to be unfavourable to the Chinese interest on being the world’s biggest importer of oil and largest manufacturing. Besides import, China also exports textiles, clothing, footwear, toys, telecom equipment and mobile telephones, furniture, computers and televisions to consumer markets all over the world. China also sells military equipment and ammunition, fighter jets, military uniforms, communications technology, agricultural implements, road machinery, generators and turbines to smaller states. It is therefore obvious why China has an interest in securing ocean routes along the Indian Ocean.

India and Indian Ocean For India, the IOR is particularly important because it is the largest, most populous and most powerful littoral state of the region. India’s headship is essential to navigate the future strategic regional state of affairs. Geographically, India is located at the

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crossroads of the Indian Ocean, i.e. right at the centre with a coastline of around 7,500 kms. The Ocean has allowed the synthesis of cultural, economic and security enterprises for a long time. India is characterized as a developing market economy; the world’s fifth-largest economy by nominal GDP and third-largest by purchasing power parity (PPP). By 2030, India will shift from “being an economy led by the bottom of the pyramid”, to one driven by the middle class. An estimated 80 percent households are likely to become middle-income in 2030 from the 50 percent today. According to Ojha and Ingilizian (2019), the middle class will lead 75 percent of consumer expenditure in the next twenty years. While 140 million households move into the middle income and another 20 million move into the high-income bracket, they will spend at least two times more on essential categories and three to four times more on services. Upper-middle-income and high-income entrants will drive a 15–20 percent increase in the ownership of durables (Ibid.). Naturally, higher consumption will require increased supply of consumer products and energy. India will naturally want to fulfill the demand for an uninterrupted growth and development. Almost 80 percent crude oil (3.28 million barrels) per day is required by India. India not only imports the oil it needs but also exports petroleum and liquefied natural gas using the same channel. Besides energy extraction, export and import, this area yields massive maritime resources such as fish, aquaculture industries, minerals, etc. The IOR, hence, has more relevance to India than one that encompasses myriad aspects. Security is another dimension of the oceans’ importance around the littoral countries. The security must be preserved to protect a country from terrorist attacks, pirates, transnational attacks, etc., and uphold its national integrity. India’s objectives towards the ocean were contoured under the flagship SAGAR (Security and Growth for All in the Region) aimed at building India’s own capabilities, helping regional partners with building transparency, trust, helping regional partners with capacity-building, peaceful resolution of maritime issues, sustainable development, and cooperation with non-Indian Ocean region actors, respect for international maritime rules and norms by all countries (Jaishankar, 2016). India is not only focused only the above-mentioned objectives but also on the maritime boundaries and security aspects. New Delhi is eager to play a bigger role in this region and become the net security provider to this region.

China’s Interest in South Asian Countries: Threading a “String of Pearls” During the past decades, there has been an increasing concern in the international world over China’s growing interest in naval expansion in the Indian Ocean Region. China’s activities around this ocean area are considered an elusive move to restructure the relationships around the Indian Ocean Region with aiming to extract long-term advantages from this region. To protect its national interest, China ventures into a new aeon of maritime ambition but antithetically seems to obliterate the other

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players. If not a confirmed hypothesis, this is the popular notion drawn by the Western experts and also the Indian experts from the point of view of China’s activities in the Indian Ocean littoral countries situated in South Asia. India has its reason to believe so, due to the interests taken by China in upgrading the naval bases of Pakistan, Bangladesh, Sri Lanka, Maldives and Myanmar in South Asia as well as Mauritius and Seychelles. This nebulous character of Chinese naval discourse augers a somewhat harmless engagement in the Indian Ocean Region at this point might have concealed connotations that would only unfold in the future. The rapidity and intensity with which Beijing has been investing on these countries reckons as though it is preparing to eventually set up naval and military base in this region. (Mahadevan, 2014). China and Pakistan’s friendship goes far back in history. Howbeit, the nature of Chinese investment in Pakistan, and specifically in the port of Gwadar and financing of a canal across the Kra Isthmus has aroused concerns in India and the West. Gwadar, located only 240 miles from the Straits of Hormuz is a Pakistani port-enabling access to the Persian Gulf and the Arabian Sea. The port is particularly crucial for its role in the global shipping trade. It has come under India’s notice as a consequence of Pakistan’s significant acceptance to Chinese investment and operational control. From an economic frame, it looks like a trade and energy corridor that unites the port to the markets within Pakistan and throughout the region. Beijing undertook the commitment to finance the construction of the port as well as aid to build roads, rail lines and pipeline links. The infrastructure corridor as envisaged by China would connect Gwadar to Kashi in Xinjiang Province passing through the Karakoram Pass. A closer observation however shows that it would bring Chinese ships within close range of the US navy (Mahadevan, 2014, p. 2). In Sri Lanka, the Hambantota Port-another zone of interest of the Chinese, is located on the southern end, approximately six nautical miles from the major Indian Ocean east–west shipping route. On completion, the port will accommodate cargo terminals, a harbor, bunkering, refueling facilities and repair facility. Its construction was funded by China, although the government of Sri Lanka did not grant Beijing the right to form a base there. China has also contributed for the development of several ports in Myanmar. Unlike the other cases, they have been permitted rights to operate the facilities of Myanmar’s navy and airports. Myanmar is considered geostrategically important by various scholars. China’s military presence in Myanmar’s Island was pervasive during the nineties. They constructed a listening post on Coco Island which was alarming for India. An ocean outlet through Myanmar would let the smooth movement of resources without having to cross the Strait of Malacca. Also, the port of Sittwe is desirable to the Chinese to set up naval bases, therefore funds were provided for various projects on this port. Eagerness to build naval base (submarines) in one of the outlying islands of Maldives was also expressed by the Chinese government. Massive funding to develop infrastructures, roads, rail, military aids, and naval up-gradation has been provided to Bangladesh (discussed in the section below) as well. Looking at this picture, a discernable commonality that may be pointed out is China’s desire to engage in naval activities of these countries in the form of either

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supplying arms/ammunitions, encouraging infrastructural development, construction of roads, ports, etc., or economic assistance. Moreover, South Asia’s placement as a continental sub-region within the Indian Ocean maritime region has great value in the political world. It directs towards an inevitable geopolitical rivalry between India and China in the Indian Ocean, involving a competition for influence in countries such as Bangladesh (the recent betide) Pakistan, Myanmar, Maldives and Sri Lanka. China and South Asia’s maritime relation has been deduced as “Chinese encirclement” of India by Indian scholars and the American articulation of “String of Pearls” just adds more dimensions to the idea of “encirclement”. India considers this approach as “encirclement”, and the concerns have been raised repeatedly to the neighbouring states regarding their military-security link-ups with China. According to C. Raja Mohan as stated in Indian Express (2010), the strategy of “string of pearls” has led China expand their maritime reach in the Indian Ocean. As pointed out earlier, the American and Indian notion about the two phrases indicates complex foreign policy and maritime strategy. China’s desperate need to secure its sea-borne energy imports from Africa and the Middle-East/West Asia has only complicated the scenario.

China’s Investments in Bangladesh The Sino-Bangladesh diplomatic relations were established in 1975 amidst muchundesired attitude towards a newly formed Bangladesh (in 1971). China shared close bonds with Pakistan at that time and disapproved recognition to Bangladesh as an independent country (Jashim-Uddin & Bhuiyan, 2011, p. 1). Not only did it condemn Indo–Bangla relationship but also called Bangladesh a subordinate to India. China went on further by passing its first veto upon entering the United Nations against Bangladesh’s entry to the United Nations. Nonetheless, ever since the diplomatic ties were set up, the relationship of the two countries based on mutual interest and trust made remarkable progress so far. Over all these years China has supplied immense economic assistance, hardware and military and technical support to Bangladesh. During and after the Cold War period, Bangladesh continued to play an important role in China’s policies towards South Asia. Their “all weather friendship” is proffered by economic, political, diplomatic/strategic and military cooperation and in the present time they have strengthened the friendship with massive economic and military cooperation. Prashant Kr. Singh opines, China considers Bangladesh as “close neighbors” who are separated just by a small stretch of Indian Territory (in the Northeast) and therefore reaches out with good-neighborly attitude to Bangladesh (Singh, 2010). Bangladesh’s impressive economic caliber has helped it maintain a steady five to six per cent GDP growth (Central Intelligence Agency: The World Fact Book) rate since 1996. There is a growing population of middle class and affluent consumers estimated to be seven per cent approximately (ICEF Monitor, 2017) making it a potential hub for trade/business for Chinese traders. As cited in Andalou Agency,

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the equilibrium of China–Bangladesh alliance has continued through bilateral trade. China is the largest trade partner of Bangladesh, while Bangladesh is the thirdlargest trade partner for China in South Asia (Hossain, 2016). In mid-October, 2016, a Memorandum of Understanding was signed by the two countries with the vision to strengthen investment and production capacity. According to the Memorandum of Understanding, Bangladesh was entitled to receive USD 24.45 billion in bilateral assistance from China for 34 projects and programs (Hossain, 2016). Both countries believe in the philosophy of development and prosperity. In order to maximize the advantages of globalization on the premise of international order China, besides trade and economy has taken part in maximizing defense cooperation with Bangladesh. At present, it provides arms and ammunitions, human resource development, training to Bangladesh. The matter of concern here is not the Sino-Bangladesh trade or defense-related involvements, rather it is China’s newly developed interest in Bangladesh’s navy. Its maritime cooperation with Sri Lanka, Myanmar and Pakistan is a known fact in the international community but Bangladesh being a littoral country of the Indian Ocean’s backwater Bay of Bengal has drawn China’s attention that has stirred the political experts. Singh (2010) refers to Indian analyst C. Arasakumar, a believer of “Chinese encirclement” theory elucidated that China’s endeavour to achieve a strategic security in India’s neighbourhood in the Indian Ocean include seeking naval and commercial facilities in Bangladesh. Bangladesh entered into a new era of naval up-gradation when their navy installed the first-ever submarines in late November 2016, since its independence in 1971 at a naval base in the south-eastern port city of Chittagong. The submarines were bought from China for USD 203 million as an initiative to upgrade and reinforce their naval forces (Alam, 2017). The Type-035G Ming-class submarines maybe obsolete in terms of structural design argues Jha (2016), nonetheless possess the qualities9 way above the need of Bangladesh and have been considered sufficient by the Government of Bangladesh not only for the purpose of training and capacity-building against adversary nations (such as the Myanmar Navy). The induction of the two renovated submarines from China made Bangladesh the second navy in Bay of Bengal to have acquired an undersea capability. In the naval realm, China is ever keen to help its single largest trading partner. The acquisitions of two submarines are merely latest addition to the list of naval involvements China has had with Bangladesh. For the past years, the Chinese have been providing Bangladesh Navy with corvettes, patrol crafts, submarines, and frigates and invested in port constructions. Regarding this matter the port city of BangladeshChittagong has been a vital location because it is located on the Bay of Bengal, for instance, these submarine will be based in the newly constructed submarine base at Kutubdia Channel near Cox’s Bazaar, Chittagong. Earlier in 2016, two 1,350 ton Type 056 corvettes10 built by China Shipbuilding and Offshore International Company joined the Bangladesh Navy, with two more Type-056 s in pipeline. Bangladesh had also acquired two ex-Jianghu-III Chinese frigates in 2014. China has also invested on building six 648 ton Durjoy-class11 patrol craft to add to the two previously delivered patrol crafts to the navy of Bangladesh by

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their Wuchang Shipyard at Khulna Shipyard, the Padma-class patrol vessels are being built by the Khulna Shipyard with support from China Shipbuilding Industry Corporation. In future, once again with Chinese assistance, Bangladesh Premier Sheikh Hasina has plans to construct warships in the Chittagong dry-dock as well as establish a major naval base in the Rabanabad Channel, Harare Province in southwestern Bangladesh which is a marine channel (on Bay of Bengal), which will have both submarine berthing as well as aviation facilities (Jha, 2016). Being a coastal area, Bangladesh experiences both advantages and disadvantages. In the recent regional and global security scenario, an in toto maritime security involving upgraded ports, off-shore oil and gas facilities, shipping and shipping lanes is required by Bangladesh. Bangladesh ended its maritime boundaries disputes with Myanmar and India in 2012 and 2014 respectively via international arbitration. After the arbitration, Bangladesh was entitled to claim an exclusive economic zone (EEZ) stretching over 111,631 square kilometers. The area is as much as its landmass. Bangladesh needs to protect its territorial sea, EEZ and continental shelves that have the exclusive rights to explore and exploit and other marine resources. Bangladesh also needs to secure its maritime area from transnational non-military threats ensuing from the seas. To take all these matters under control Bangladesh needs to strengthen its capacity building to secure its marine resources and toughen maritime patrol. But what hinders the growth is Bangladesh’s limited resource. Hence, it necessitates an active engagement from bigger nation to help facilitate this zone.

Conclusion The Indian Ocean Region is the strategic hub of the twenty-first century. As China’s sea lines connect the region’s economy to an energy source in the Africa and MiddleEast China considers the Indian Ocean as crucial to its geopolitical rise. There is a widespread conjecture regarding the developments of ports in the South Asian countries, China insists the projects are strictly commercial in nature with no military implications. They are neither seeking military expansion nor trying to set troops or military bases in any foreign country. On the contrary, Beijing claims they want to promote world peace, stability, and development and not cause threat to anyone. China’s emphasises on the importance of these ports to maintain the smooth flow of oil/energy in order to enhance the economic and domestic scenario. It is undecided whether China is following a dream to build a hegemonic power in the near future along “String of Pearls”, or they are simply focusing on their necessity to secure sufficient fuel/energy, therefore abiding by their official plan of economic growth and quietly intensifying in the global stage as a major actor. Amidst all these speculations India’s perception is of more importance and India’s comprehension is China is encircling them. China’s progression towards Bangladesh and the other South Asian littorals have caused many in the international community to question the rationale behind such a buildup (commercial and military) According to various scholars, although the Cold-War is over, but China is still exercising the containment

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theory, probably subtly and containing India by building a “string of pearls” around India in the Indian Ocean with Bangladesh as an precious “pearl” in this “string”. China’s active involvement in the construction of Chittagong port (of Bangladesh) is recognized as proof of this argument. With regard to achieving its domestic development objectives, Bangladesh is, depended on Chinese financial fund for their infrastructure projects. As China is a rising global power, it financially can afford to help other nations, developing nations are eager to have closer relations with it. With the developed countries in the West and many international organizations moving away from funding these developing countries, China is interested to take up that responsibility. When the whole world is hopeful at receiving China’s help, Bangladesh has no reason for not nurturing its relationship with China. The Sino–Bangladesh relationship has its own understanding to help their relationship grow in a positive manner. Bangladesh harbours no apprehension for being a small power compared to China and probably that is one major reason why Bangladesh has no hesitations to seek support from China. Their bilateral relations have not grown out of any ideological commitments and whatever differences were there in the beginning, improved with time Bangladesh clearly realizes it cannot overpower India or China in a sea battle. Rather Bangladesh’s focus is to strengthen its naval power to protect its maritime territory from unforeseen non-military threats. But if Bangladesh acts as China’s proxy base in the region this will naturally make India very uncomfortable especially when both these Asian countries are striving to obtain new military power in order to become a regional best. Whether geography allows or not China never stopped trying to expand its naval strength and made every effort to access to the Bay of Bengal. Obviously, China has its reasons to do so. But Bangladesh is just another aspect of China’s strategy to significantly augment its global naval strength. Notes 1.

2. 3.

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The Asian economic partners of China are Hong Kong, Japan, South Korea, Vietnam, Singapore, Malaysia, Thailand, Indonesia, India, Bangladesh, Nepal, Pakistan, Sri Lanka. Source: Daniel Workman, 2017, China’s Top Trading Partner, http://www.worldstopexports.com/chinas-top-import-partners/. In 1978 China adopted the policy of ‘open door’ as a reform program to boost China’s economy. The phrase String of Pearls was coined by the Booz Allen Hamilton Defence Contractors in a report of 2005 called Energy Futures in Asia to describe the growing activities of China to strengthen the geo-political hold enhancing diplomatic ties, modernizing its military and accessing energy resources throughout littoral South Asian nations of the Indian Ocean. The physiographic regions of the world are ways of defining the Earth’s landforms into distinct regions, based upon by Nevin Fenneman’s classic threetiered approach in 1916, which further classifies landforms into 1. Physiographic divisions 2.Physiographic provinces; and 3. Physiographic sections Source: Internet.

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There are 166 countries and the European Union to have ratified UNCLOS. Organizations functioning similarly to UNCLOS are International Maritime Organization (IMO), International Tribunal on the Law of the Sea ( ITLOS), International Seabed Authority (ISA) https://www.cfr.org/report/global-oce ans-regime. Forty per cent of the oil production takes place in the basin of Indian Ocean, fifteen percent of the world’s total fishing takes place here, aquaculture, coastal sediments, rare earth materials, mineral resources like iron, cobalt, and, sulphide deposits of cobalt, manganese, zinc, gold and silver are in massive quantities on the sea bed. Minerals and Raw materials like copper, cobalt, cadmium, coltan, diamonds, ferrochrome, gold and platinum. Raw materials and natural resource from various African countries like Angola, Cameroon, Guinea, Ghana, Nigeria, Congo, the Sudan and Uganda, Liberia, South Africa, Zimbabwe and Zambia. The two submarines are 76 m long and 7.6-m wide, hull draught of 5.1 m can achieve a top speed of 18 nautical miles per hour, with a submerged displacement of 2,110 tonnes. Each boat has a complement of 10 officers and 47 sailors and sports eight 533 mm tubes capable of deploying weapons such as Yu-3 and Yu-4 heavyweight torpedoes. A total of either 32 naval mines or 14 torpedoes is possible to carried by these boats. The submarines system has a decent sensor/tracking system along with have an integrated sonar and electronic warfare suite with Chinese derivatives of Western origin. BNS Shadhinota and BNS Prottoy, Each ship is armed with 76 mm and 30 mm naval guns as well as C-802A anti-ship missiles (ASMs) and a FN-3000 N surface-to-air missile system. The Durjoy-class is considered a scaled down variant of the Type-056 design and is armed with the lighter C-704 ASM. The C-704 may also arm BN’s.

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Egberink, F., & van der Putten, F. P. (2011). ASEAN, China’s Rise and Geopolitical Stability’ in Asia, Clingendale Paper No. 2. Netherlands Institute of International Relations Fernando, S. (2012). China’s Post-1978 maritime relations with South Asia: Towards greater cooperation. Routledge Taylor and Francis Strategic Analysis, 36(3), 461–476. ICEF Monitor. (2017). Bangladesh: Middle class growth helping to drive demand to study abroad. http://monitor.icef.com/2017/02/bangladesh-middle-class-growth-helping-to-drive-dem and-for-study-abroad/ Jha, S. (2016). The Bay of Bengal Naval Army Race. The Diplomat Jaishankar, D. (2016). Indian ocean region: A pivot for India’s growth. Brookings. Retrieved https:// www.brookings.edu/opinions/indian-ocean-region-a-pivot-for-indias-growth/ Ji, Y., & Xu, Y. (1991). In search of blue water power: The PLA Navy’s maritime strategy in the 1990s. The Pacific Review, 4(2). Kun-Chin, Lin, K.-C., & Gertner, A. V. (2015). Maritime security in the Asia Pacific—China and the emerging order in the East and South China Seas. Chatham House, the Royal Institute of International Affairs. Khurana, G. S. (2008). China’s String’s of Pearls’ in the Indian Ocean and its security Implications. Strategic Analysis, 32(1), 1–39. Mastro, O. S. (2020). China’s maritime ambitions. American Enterprise Institute. https://www.aei. org/research-products/testimony/chinas-maritime-ambitions/ Mahadevan, P. (2014). China in the Indian Ocean: Part of the larger PLAN. CSS Analyses in Security Policy, 156 MacDonald, A. P. (2013). China’s maritime strategy: A prolonged period of formulation. Canadian Naval Review, 8(4) Michel, D., & Sticklor, R. (2012). Indian ocean rising: Maritime security and policy challenges. Stimson Ojha, N. P., & Ingilizian, Z. (2019). How India will consume in 2030: 10 mega trends, World Economic Forum. https://www.weforum.org/agenda/2019/01/10-mega-trends-for-indiain-2030-the-future-ofconsumption-in-one-of-the-fastest-growing-consumer-markets/ Pham, T. N., (2016). China’s maritime strategy on the horizon. The Diplomat Raja Mohan, C., (2010). Chinese takeaway. Indian Express Rehman, I. (2010). China’s string of pearls and India’s enduring tactical advantage. Institute for Defence Studies and Analysis Sweijs, T., Cleven, W., Levi, M., Tabak, J., Speear, Z., & de Jonge, J. (2010). The maritime future of indian ocean-putting the G back into great power politics. The Hague Centre for Strategic Studies, 13. Singh, P. K. (2010). China-Bangladesh relations: Acquiring a life of their own. China Report, 46(3), 267–283. Upadhyaya, S. (2017). Expansion of Chinese maritime power in the Indian Ocean: Implications for India, defence studies. Journal of Military and Defence Studies, 17(1), 63–83. Uddin, M. J., & Bhuiyan, M. R. (2011). Sino-Bangladesh relations an appraisal. BIISS Journal, 32(1), 1–24. Wolf, S. O. (2014). China’s strategic interests and its impact on Bangladesh. APSA. Wei, S. (1995). The open door policy and China’s rapid growth: Evidence from city-level data. In I. Takatoshi, and O. K. Anne (Eds.), Growth theories in light of the East Asian experience (pp. 73–104). University of Chicago Press

Dr. Hoimonti Barua Research Fellow at Centre for Research and Development (CRD), Bangladesh and a Visiting Fellow at Nepal Institute of International Cooperation and Engagement (NIICE), Nepal. She was awarded the prestigious Indian Council of Social Science Research (ICSSR) Doctoral Fellowship for her Ph.D. Dr. Barua holds a Ph.D. from the Centre for South Asian Studies, School of International Studies, Jawaharlal Nehru University, New Delhi. She has published several articles in national, international journals and news portal and participated in

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national and international conferences. She focuses on geopolitical issues, diplomacy and foreign policy of Bangladesh, India, China in particular and South Asia in general. She is currently engaged in research related to nontraditional security threats pertaining to climate change, climate justice in Bangladesh.

Chapter 12

China and the BRI: Challenges and Opportunities for Southeast Asia Alessandro Albana and Antonio Fiori

Abstract Since Xi Jinping’s unveiling, in 2013, the Belt and Road Initiative (BRI) has drawn remarkable global attention, raising polarized judgements about China’s ambitions. A number of countries and institutions enthusiastically considered the BRI as a valuable infrastructural and economic contribution that would enhance connectivity among Eurasian countries; on the other hand, critics viewed the BRI as part of Beijing’s effort to gain global influence, especially within its neighborhood. Chinese policymakers have considered Southeast Asia as a critical region for the success of the BRI, mainly because of the geographical proximity as well as the strong economic ties with both individual states and the ASEAN. In Southeast Asian states’ view, however, the BRI still presents a mixed picture of opportunities and challenges. Despite the clear appeal the BRI has to both democratic and authoritarian leaders in the region, especially at a time of economic uncertainty—fueled by unhelpful actions by the United States (withdrawal from the TPP and the trade war against Beijing)—concerns remain. Potential overdependence on China, the BRI’s financial sustainability and negative popular perceptions about Beijing within certain Southeast Asian countries, all contribute to nurture caution in the region. The paper aims at showing how the implementation of the BRI will likely enhance China’s influence in Southeast Asia. Against this backdrop, whereas the establishment of a renovated Sinocentric system is far from certain, this study sheds light on the challenges and opportunities the BRI is determining upon Southeast Asian countries and their relationship with Beijing. This article reflects the joint outcome of the efforts of both authors. In practice, though, AA wrote the sections “Introduction” and “Southeast Asia and the BRI: A Chinese Perspective,” whereas AF wrote the sections “The Unraveling of the BRI in Southeast Asia” and “A Long Way Ahead for the BRI.” We are aware it may sound quite odd, but it is required by the Italian Agency for the Evaluation of the Academic System and Research (ANVUR) for co-authored articles to be eligible for evaluation. For this reason, it is important that the footnote be included. A. Albana (B) Asia Institute, Bologna, Italy e-mail: [email protected] A. Fiori University of Bologna, Bologna, Italy © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_12

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Introduction In late 2013, the President of the People’s Republic of China (PRC) and General Secretary of the Chinese Communist Party (CCP) Xi Jinping officially unveiled the One Belt One Road (OBOR), an ambitious international project aimed at developing an integrated network of infrastructural, financial and trade connections between China and Central, South and Southeast Asia, Oceania, the Middle East, East Africa and Europe. In September that year, Xi Jinping gave a speech at Nazarbayev University, in Kazakhstan, during which he introduced the “Silk Road Economic Belt”, OBOR’s overland leg (Ministry of Foreign Affairs of the PRC, 2013). The following month, during a visit to the Indonesian Parliament, Xi introduced the “21st Century Maritime Silk Road”, the maritime projection of the Belt and Road Initiative (BRI, as the OBOR had later been rebranded) connecting China’s eastern coast to the Indian Ocean region, the South Pacific Ocean and even the Mediterranean region (Xinhua, 2013). The contexts where the project was announced are meaningful for the understanding of the global significance of the BRI. Central Asia, where Kazakhstan lays as the biggest post-Soviet state whose record of economic and political relations with China has been on the rise since the collapse of the USSR, holds crucial importance for the implementation of the BRI overland projects. Concurrently, Indonesia, and Southeast Asia more broadly, is crucial for the implementation of the Maritime Silk Road (MSR), as China’s relations with the region are characterized by robust economic ties but have failed to achieve positive and longstanding momentum in the political and diplomatic realm. Southeast Asian nations seem to have generally welcomed the BRI, which could provide great opportunities to enhance regional trade—a pivotal factor for ASEAN countries after the collapse of the Trans-Pacific Partnership (TPP)—through the improvement of interregional connectivity. The BRI could be highly beneficial in endowing Southeast Asia with infrastructure greatly needed by some of these countries, unleashing the full economic potential of the region. In our contribution, we aim at showing how the implementation of the BRI will likely enhance China’s influence in Southeast Asia. Against this backdrop, this study sheds light on the challenges and opportunities the BRI is determining upon Southeast Asian countries and their relationship with Beijing.

Southeast Asia and the BRI: A Chinese Perspective In order to discern the importance of Southeast Asia for China’s BRI, it is necessary to understand how and why such a gigantic and—to some extent—hazardous project has come to be seen as a foreign policy priority by the Chinese leadership. As China’s foreign policy represents a comprehensive, proactive and complex dimension for the implementation of Beijing’s global strategic vision, this study frames the BRI as a landmark initiative whose significance is not limited to economic or diplomatic considerations, being rather all-encompassing (Callahan, 2016). Against

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this backdrop, it has been widely emphasized that, with Xi Jinping becoming the top leader of the CCP (2012) and the PRC (2013), China’s foreign policy shifted to a more proactive, let alone assertive, approach (Zhang, 2015). The unveiling of the BRI, occurring few months after Xi took office, well epitomizes the shift from President Deng Xiaoping’s call for “keeping a low profile” (taoguang yanghui 韬光养 晦) in global affairs—a prescription endorsed at a later stage by Deng’s successors, Jiang Zemin and Hu Jintao—to “striving for achievement” (yousuo zouwei 有所作 为) (Yan, 2014b; Zhou & Esteban, 2018). From this perspective, the BRI signals China’s increasing self-confidence, with the Chinese leadership seemingly growing progressively convinced that sustained economic growth, incremental military capabilities and rising diplomatic influence at the international level made Beijing ready to play a greater role in global affairs (Yu, 2017). From a different perspective, the BRI may also be understood as a strategy aimed at addressing the emergence of critical phenomena affecting China’s domestic economy and foreign relations. Several negative factors may have supported Chinese leaders’ decision to embark on such an ambitious initiative. Firstly, China’s GDP growth has been cooling since the second half of 2014, falling from a double-digit growth to between 6 and 7 percent on a yearly basis, ushering in a “New Normal” of “slower but more sustainable economic development” (Zhang & Chen, 2017, p. 1). Secondly, one of the top economic priorities for the Chinese government is to solve the massive excess capacity in several productive sectors, such as steel and cement; in fact, this overcapacity is at the foundation of several difficulties, such as increasing debt levels and squeezing corporate profits, contributing to making the domestic financial system more vulnerable. The BRI, with its focus on infrastructural oeuvres, represents a source of alleviation to the Chinese industrial overcapacity, promotes the internationalization of the Chinese currency, stimulates the country’s economic growth, assists the transition from investment-led growth to a consumer-driven economy and, especially in Southeast Asia, it supports developing countries affected by significant infrastructural deficits. Thirdly, the reorientation of the US strategic vision announced by the Obama administration in late 2011, known as the “Pivot to Asia”, provoked disquiet within the Chinese leadership, as the shift in Washington’s foreign policy was perceived as an attempt to enhance the US influence in the Asia–Pacific region, with obvious detrimental implications for China’s rise (Shambaugh, 2013; Wang, 2016). Fourthly, China seemed to be growing increasingly concerned with the deterioration of its relations with Southeast Asian countries in the wake of the 2008 financial crisis (Wang, 2016). Whereas economic ties between China and its Southeast Asian neighbors have increased steadily from 1997 through 2016—with Beijing-ASEAN bilateral commercial exchanges jumping from USD 24,2 billion to USD 460,3 billion (Laurenceson, 2017)—political relations were yet to overcome widespread concerns from Southeast Asian countries towards China’s interests in the region. In particular, Beijing’s assertive stance regarding maritime disputes in the South China Sea (SCS), where also Malaysia, the Philippines, Taiwan, Vietnam and—to a lesser extent— Brunei Darussalam maintain overlapping claims, has contributed a great deal to the Southeast Asian nations’ mistrust of China. Finally, China is highly dependent on the Strait of Malacca, a chokepoint controlled by Indonesia, Malaysia and Singapore,

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through which about 80 percent of its energy needs flows. For China, it would be vital to control the Strait of Malacca through the MSR in order to safeguard its economic and energy security from being threatened by other countries and escape from the entrapment represented by the so-called “Malacca Dilemma” (Shi, 2004). Under such circumstances, in the eyes of the Chinese leadership it was seemingly clear that economic engagement alone might have not been sufficient for enabling broader political convergence with the region. Not surprisingly, the early announcements of the BRI in 2013 were soon to be followed by President Xi’s call for the shaping of a “Community of Shared Destiny” (gongtong mingyun ti 命运 共同体) (Xi, 2017). Whereas such a strategic vision potentially involves the entire international community, it is at Southeast Asian countries that it is first and foremost targeted. Tellingly, the Community of Shared Destiny was first called upon during President Xi’s speech in Indonesia in 2013 (Xinhua, 2013). During that year, moreover, Premier Li Keqiang “emphasized the need to build the Maritime Silk Road oriented towards ASEAN” within the framework of the China-ASEAN Expo (NDRC, Ministry of Foreign Affairs & Ministry of Commerce of the PRC, 2015). Enjoying geographical proximity and longstanding cultural, economic and political relations with Beijing, Southeast Asia has traditionally represented a crucial dimension for the implementation of the BRI, if only for its proximity to China and its location at the juncture between East Asia, Oceania and the Indian Ocean region (Callahan, 2016). The development of the project has therefore been accompanied by a number of cultural, economic and political initiatives promoted by Beijing and aimed at consolidating ties with the region in a comprehensive fashion. Against this backdrop, the Community of Shared Destiny can be considered as China’s strategy to enhance economic exchanges, pursue better diplomatic relations, and improve people-to-people connections with Southeast Asian nations. In this scenario, Beijing does not only seek to improve international cooperation with the region, but rather pursues a more comprehensive strategy nurturing a wider political understanding based on the principle of win–win cooperation. That the Community of Shared Destiny is to find its core in Southeast Asia is further epitomized by the unveiling of the “Peripheral Diplomacy” (zhoubian waijiao 周边外交). Significantly, both the Community of Shared Destiny and the Peripheral Diplomacy have been announced in 2013; as far as broad strategic objectives are concerned, moreover, both dimensions seem to have much in common. As with the Community of Shared Destiny, the Peripheral Diplomacy defines a comprehensive set of actions aimed at “integrat[ing] domestic and international goals […], comprehensively expanding from economic engagement to foster closer political, cultural and security networks” (Callahan, 2016, p. 5). Against this backdrop, the Peripheral Diplomacy and the Community of Shared Destiny can be conceived as integrated and intertwining strategies aiming at the consolidation of China’s influence in Southeast Asia as much as at the improvement of China’s domestic development (Yan, 2014a). Indeed, while announcing the “Chinese Dream of National Rejuvenation”, President Xi made clear that the Peripheral Diplomacy had to play a key role for the achievement of the Chinese Dream (Xi, 2017). The Chinese Dream (Zhongguo meng 中 国梦) sets two “centennial goals” for the PRC to become a moderately prosperous

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country by 2021 (100th anniversary of the CCP foundation) and an “affluent, strong, civilized and harmonious socialist modern country” by the 100th anniversary of the establishment of the PRC, in 2049 (Xinhua, 2012). Whereas its exact meaning may be subject to many and different interpretations, the Chinese Dream came to epitomize Xi Jinping’s strategic vision for an economically prosperous, socially stable, politically strong and globally proactive China in the twenty-first century. China’s ambition for a comprehensive engagement of Southeast Asia can be seen as both one of the key objectives and a necessary precondition for the implementation of the BRI. That such an engagement is pursued in a comprehensive fashion is further demonstrated by the involvement of Southeast Asian nations in a broader range of international initiatives, such as the Asian Infrastructure Investment Bank (AIIB). Beginning operations in January 2016, the AIIB emerged as a multilateral development bank investing mostly in the infrastructure sector. Established by China, the AIIB has been joined by all Southeast Asian countries, looming as a key tool in Chinese hands for shaping the Community of Shared Destiny in the region (Ren, 2016). In this scenario, the BRI connectivity pursued by Beijing is emerging in terms of hardware infrastructure while also focusing on the consolidation of soft connections between China and Southeast Asia (Callahan, 2016; Yu, 2017). Clearly, China nurtures high hopes for the BRI’s success in Southeast Asia, and the initiative holds the potential to make China “the dominant force in determining the future economic landscape of Southeast Asia” (Gong, 2019; Yu, 2017, p. 120).

The Unraveling of the BRI in Southeast Asia If, during the Cold War, Southeast Asia looked at China with diffidence, considering it as a threat, the situation gradually changed in the wake of Beijing’s transition to a market economy: in the 1990s, in fact, major powers in the region started to normalize their relations and establish institutionalized connections with the PRC. One of the most appreciated gestures was the financial assistance granted by China during the Asian financial crisis, in 1997 and 1998: Beijing’s refusal to devalue the renminbi impressed Southeast Asian countries, which admired China as a responsible power that respected their interests. This move, along with the inconsistency of the International Monetary Fund and the World Bank in dealing with the crisis, accelerated the establishment of the “ASEAN Plus Three” mechanism: the exclusion of the United States, interpreted as a decline of Washington in the region, was highly welcomed by China, who seized the opportunity to maximize its influence in the area (Cheng, 2013). Thereafter, despite tensions re-merging periodically, largely due to the SCS disputes, Sino–ASEAN relations have gradually improved, to the point that in 2002 a Framework Agreement on Comprehensive Economic Co-operation was signed to establish a free trade area (FTA) covering the six old ASEAN nations by 2010 and all ten ASEAN members by 2015. Since the launch of the FTA, China’s share of ASEAN total merchandise trade increased from 8 percent in 2004 to 21 percent in 2018; since 2009, China has become ASEAN’s biggest trade partner,

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with trade volume amounting to USD 591.1 billion in 2018 (Menon & Melendez, 2019a). In addition, in 2017 China has become ASEAN’s third-largest source of FDI, with flows amounting to USD 11.3 billion (Menon & Melendez, 2019b). Along with trade and investment, China has become one of the most important sources of economic development assistance and infrastructural development to the region. The relationship, however, has not only positive sides: China’s claims of almost the entire area of the SCS, in spite of the revendications of Southeast Asian coastal states, have sparked tensions, especially in the last decade, when Beijing made increasingly bold assertions as to its maritime rights in the area. It has become habitual to divide ASEAN countries into three subgroups, depending on their different approach to the BRI. The first is represented by those lowincome and most capital-needy countries, such as Cambodia, Laos and Myanmar, who are geographically pivotal for China’s ambitions (Myanmar, for instance, is particularly relevant for China to decrease its dependency on the Strait of Malacca), have no territorial disputes with Beijing and have shown almost no reserves towards the BRI. Being these countries in need of infrastructure that can contribute to the enhancement of local economies, their cooperation with Beijing has promptly developed; some examples of that cooperation are the China-Myanmar Economic Corridor that will connect Kunming to Myanmar’s major economic centers, Mandalay and Yangon, and then westward to the Kyaukpyu special economic zone in the Rakhine state; the China-Laos Railway, one of the most important constructions under the BRI, expected to be completed by 2021, that will link China’s Yunnan province directly to Thailand, Malaysia and ultimately Singapore, enabling the shipment of Chinese goods to these markets avoiding long shipping routes; the Sihanoukville Special Economic Zone and the planned Phnom Penh-Sihanoukville Expressway that will improve interconnections between Cambodia’s capital city and the southern provinces of the country. It must be highlighted, however, that these countries have recently proven to be more cautious towards Chinese investments, fearing the risk of an excessive debt burden. Nonetheless, since attracting investments has become extremely difficult for both Cambodia and Myanmar, due to sanctions enacted by the West over human rights abuses and other violations, they seem to have no other choice but to rely on Beijing’s support for infrastructural development. Although the government-to-government relations between Beijing and these three countries appear substantially idyllic, the influx of Chinese money and people—workers and businessmen, but also tourists—is affecting the lives of locals, causing rising dissatisfaction. Many within the local communities are disappointed by the fact that small local businesses have not benefitted from the BRI—given that the money injected from China has been apparently kept within the Chinese community—and by the apparent worsening in the gap between the rich and the poor in their societies. In addition, China’s increasing political influence on local communities and national authorities is often considered an existential threat to their cultures, values, and environment. Countries in the second group, namely Singapore, Thailand and Vietnam, have been more diffident and cautious with respect to the implementation of the BRI, due to their somewhat problematic political, economic and strategic relations with

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Beijing. Hanoi, for example, is in desperate need for infrastructure investments and hence it supports the initiative diplomatically; however, the strict criteria related to the BRI loans and, above all, concerns regarding the SCS dispute have contributed to create some reluctancy. The same problem has emerged with Bangkok, with which Beijing has discussed since 2010 of the construction of a high-speed rail intended to connect Thailand’s east coast ports and industrial zones to Kunming stretching through neighboring Laos. The long negotiation has been triggered by the political instability into which Thailand has been recently trapped and by the shareholding structure and interest rate on the loan China has offered (Thongnoi, 2019). The troublesome negotiations and the slow pace of the whole process were, according to some commentators, the main reason for Thai Prime Minister Prayut’s exclusion from the BRI Summit held in Beijing in May 2017. China intended to show openly its dissatisfaction and use the stick rather than the carrot, but remained open to offer Thailand a second chance that took shape during the 9th BRICS Summit in Xiamen in September 2017 (Busbarat, 2017). Another crucial absence at the BRI Summit in 2017 was that of Singaporean Prime Minister Lee Hsien Loong, most likely due to the city-state’s refusal to side with China in the SCS territorial dispute; later that year, however, Singaporean Premier’s visit to China re-fueled mutual relations. Singapore’s importance for the development of the BRI is not merely geographic, but is rather dependent to a large extent on its assessment as a financial hub and as a source of third-country partnership (Singapore Institute of International Affairs (SIIA), 2018). Nevertheless, Singapore’s measured interest in the BRI is likely to continue due to its status of developed country not in need of incentives for infrastructural development, unlike poorer countries such as Cambodia or Laos. The last subgroup involves Indonesia, Malaysia and the Philippines, i.e. countries that have shown their “Sinoskepticism” towards the BRI and its investments. Although its location in the western Pacific Ocean is critical to the MSR, the Philippines has not yet reached a single agreement on the BRI with Beijing: on some accounts, this is due to the dispute in the SCS and to the 2016 arbitration case, invoked by the former Aquino III administration, that ended up with the rejection of Chinese claims in the area (Li & Amer, 2018). Since President Duterte’s election, in 2016, bilateral relations have intensified and improved, as demonstrated by Duterte’s participation in the BRI Forum in 2017 and by President Xi Jinping’s visit to Manila in November 2018, in the occasion of which 29 agreements on infrastructural projects were ratified. Even though relations between China and Indonesia are generally strong, the implementation of the BRI in that country has encountered major obstacles, because of the long consultation process that has delayed the realization of many projects, as happened with the Jakarta-Bandung High-Speed Rail (Lai, 2019). The project was hindered by permit problems, since only half of the total land needed had been secured, and by funding difficulties on the Indonesian side. In addition, Jakarta is keen on ensuring that BRI-linked projects employ local workforce. President Jokowi’s reelection in 2019, however, seems to favor bilateral stability and a positive cooperation on the BRI. Finally, even though Malaysia was one of the most enthusiastic countries about the BRI, things dramatically changed in the wake of the 2018 general election, when former Prime Minister Mahathir Mohamad

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defeated Najib Razak, due to the lingering scandals in the administration but also to the country’s worsening economic conditions. Mahathir voiced criticism against China’s perceived “neo-colonial” style, particularly in rolling out its ambitious BRI with peculiar financing and contracts entrapping Southeast Asian nations. He also cancelled a USD 20 billion railway project—the East Coast Rail Link—funded by China, assuming that his country would be unable to provide financial contribution to its realization. At present, however, not only the project has re-materialized and the cost has been cut by one-third, but Malaysians are also publicly supporting the BRI and encouraging Beijing to make more investments, particularly in less developed areas along the planned railway route.

A Long Way Ahead for the BRI Over the past year, the competition between China and the United States, which has become more intense in the trade sector, has been carefully—and somewhat apprehensively—scrutinized by Southeast Asian countries. Since late 2017, in fact, the region has become the most important “battlefield” in the tug-of-war between China’s “Community of Shared Destiny”—epitomized by the BRI—and the Free and Open Indo-Pacific (FOIP) strategy, launched by US President Donald Trump. The FOIP strategy not only depicts China as a strategic competitor that aims to achieve “Indo-Pacific regional hegemony”, but also warns Southeast Asia against China’s predatory intentions with regards to economics and military modernization. If, on one side, Washington’s condemnation aims at countering China’s aggressive behavior, especially in the SCS, on the other hand it is a very hazardous posture: despite the American economic engagement continues to be strong in Southeast Asia—the US exports about USD 75 billion in goods and USD 31 billion in services to ASEAN countries annually, and ASEAN has received approximately USD 329 billion in cumulative FDI from Washington (Stromseth, 2019)—China’s economic leverage is incommensurably bigger, in spite of the uneasiness provoked in countries like Malaysia by Beijing’s rising economic influence. Therefore, although most ASEAN countries deeply appreciate the US commitment to regional security and its expanding defense engagement, they seem to be growing increasingly fascinated by what Beijing can offer. After all, many countries in the Southeast suspect that, unlike his predecessor, President Trump is snubbing them, as demonstrated by his decision not to attend the ASEAN meetings (apart from the 2017 event, when he left early and skipped the East Asia summit). The dissatisfaction with the US delegation—including Ambassador O’Brien, not a cabinet member, and Secretary of Commerce Wilbur Ross—at the 2019 East Asia Summit pushed ASEAN leaders to downgrade their representation at the recent 7th ASEAN-US Summit in Bangkok, where only Laotian, Thai and Vietnamese heads of state showed up, while the seven other member states simply sent representatives, in a move that has been considered a rebuke to Washington. If coupled with the decision taken at the beginning of his presidency in 2016 to pull the US out of the TPP, which the Obama administration had

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fought hard to negotiate, it may appear likely that Trump is not giving the Southeast Asian chessboard the importance it deserves. With a total estimated value of over USD 1 trillion, the BRI is an ambitious effort to strengthen infrastructure, trade, and investment links between China and the rest of the world, and Southeast Asian nations look at it with interest. However, one of the gravest endangerments all Southeast Asian countries have denounced is the possibility that the region falls into the “China debt trap” in the context of the BRI (Yamada & Palma, 2018). The term implies that China extends excessive credit to a debtor country, gaining access into the country’s economic and political workings when the counterpart is unable to fulfill the debt. One of the best examples of this phenomenon is represented by Sri Lanka, who, in 2017, was unable to repay the onerous debt it had accumulated to China; for this reason, Beijing was formally given a 99-year lease on the Hambantota port, a facility built by a Chinese company, funded by Chinese loans and then included into the BRI as part of a debt-reduction deal (Lim & Mukherjee, 2018). In addition, given that—as it happens in other parts of the world, such as the African continent—China’s interactions with the “target” country is limited to government-to-government relations, without any relevant involvement of local communities, some BRI projects, including the Hambantota port, are perceived as generous concessions to Beijing. For this reason, some BRIrelated projects have faced growing and fierce opposition by local communities in several countries, including Cambodia, Myanmar, Pakistan and Sri Lanka. This is also a good indicator to measure the widening trust deficit between China and many of its neighbors regarding the perceived real intentions which could be detrimental to the full implementation of the BRI. Whereas, on the Chinese side, the narrative on the BRI is focused on a win–win strategy, many of the neighbors tend to be more suspicious, deeming that the Chinese economic power and influence might determine critical political dependencies. Such concerns generate a certain degree of insecurity and anxiety: several Southeast Asian countries look at the Chinese plan to facilitate infrastructure investment with the utmost interest but, concurrently, they feel timorous of becoming too dependent on China. On top of that, even though the majority of costs needed to fuel the BRI are borne by the PRC and supported by the AIIB, the New Development Bank or the Silk Road Fund, individual countries involved in the program are still required to fund their domestic projects: this exposes exposing many Southeast Asian nations to serious financial difficulties that sometimes bring to the suspension or postponement of projects.

References Busbarat, P. (2017). China’s ‘shame offensive’: The omission of Thailand’s Prime Minister from the belt and road initiative summit 2017. ISEAS Perspective, 54, 1–9. Callahan, W. A. (2016). China’s “Asia Dream”: The belt road initiative and the new regional order. Asian Journal of Comparative Politics, 1(3), 226–243. https://doi.org/10.1177/205789111664 7806

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Cheng, J. (2013). China’s regional strategy and challenges in East Asia. China Perspectives, 2013(2), 53–65. https://doi.org/10.4000/chinaperspectives.6182 Gong, X. (2019). The belt & road initiative and China’s influence in Southeast Asia. The Pacific Review, 32(4), 635–665. https://doi.org/10.1080/09512748.2018.1513950 Lai, H. (2019). Indonesia: The Belt and Road Initiative and relations with China. Retrieved February 12, 2021, from https://theasiadialogue.com/2019/10/04/belt-and-road-initiative-in-ind onesia-and-relations-with-china/ Laurenceson, J. (2017). Economics and freedom of navigation in East Asia. Australian Journal of International Affairs, 71(5), 461–473. https://doi.org/10.1080/10357718.2017.1301374 Li, J., & Amer, R. (2018). Xi’s visit to the Philippines: Implications for China-Philippine relations. Retrieved February 12 2021, from https://isdp.eu/publication/xis-visit-to-the-philippines/ Lim, D. J., & Mukherjee, R. (2018). Does debt pay? China and the politics of investment in Sri Lanka. Retrieved February 12 2021, from https://thediplomat.com/2018/01/does-debt-pay-chinaand-the-politics-of-investment-in-sri-lanka/ Menon, J., & Melendez, A. C. (2019a). The upgraded ASEAN-China free trade agreement: What’s new, and will it matter? https://www.iseas.edu.sg/images/pdf/ASEANFocus%20-%20June%202 019.pdf Menon, J., & Melendez, A.C. (2019b). The upgraded ASEAN-People’s Republic of China free trade Agreement could matter, big time. Retrieved February 15 2021, from https://www.asiapathwaysadbi.org/2019/08/the-upgraded-asean-prc-free-trade-agreement-could-matter-big-time/ Ministry of Foreign Affairs of the PRC. (2013). President Xi Jinping delivers important speech and proposes to build a Silk Road Economic Belt with Central Asian countries. Retrieved February 15 2021, from https://www.fmprc.gov.cn/mfa_eng/topics_665678/xjpfwzysiesgjtfhshzzfh_665686/ t1076334.shtml NDRC, Ministry of Foreign Affairs of the PRC, & Ministry of Commerce of the PRC. (2015). Vision and actions on jointly building Belt and Road. Retrieved February 12 2021, from http:// 2017.beltandroadforum.org/english/n100/2017/0410/c22-45.html Ren, X. (2016). China as an institution-builder: The case of the AIIB. The Pacific Review, 29(3), 435–442. https://doi.org/10.1080/09512748.2016.1154678 Shambaugh, D. (2013). Assessing the US “Pivot” to Asia. Strategic Studies Quarterly, 7(2), 10–19. Shi, H. (2004). 能源安全遭遇“马六甲困局”中日韩能否携手? [Energy security faces the “Malacca Dilemma”. Can China, Japan and Korea Cooperate?]. Retrieved February 15, 2021 from https://business.sohu.com/2004/06/15/49/article220534904.shtml Singapore Institute of International Affairs (SIIA). (2018). Setting the record straight – Singapore’s role in the BRI. Retrieved February 12, 2021 from http://www.siiaonline.org/setting-the-recordstraight-singapores-role-in-the-bri/ Stromseth, J. (2019). Don’t make us choose. Southeast Asia in the throes of US-China rivalry. https:// www.brookings.edu/wp-content/uploads/2019/10/FP_20191009_dont_make_us_choose.pdf Thongnoi, J. (2019). If China funds Thailand’s high-speed rail, will the debt be too much? Retrieved February 12 2021, from https://www.scmp.com/week-asia/geopolitics/article/3007551/chinawants-fund-thailands-us12-billion-high-speed-railway Wang, Y. (2016). Offensive for defensive: The belt and road initiative and China’s new grand strategy. The Pacific Review, 29(3), 455–463. https://doi.org/10.1080/09512748.2016.1154690 Xi, J. (2017). The governance of China. Foreign Languages Press. Xinhua (2012). Xi Jinping pledges ‘great renewal of Chinese nation’. Retrieved February 12 2021, from http://www.china.org.cn/china/2012-11/30/content_27269821.htm Xinhua (2013). 习近平主席在印尼国会发表重要演讲 [President Xi Jinping delivers an important speech at the Indonesian Parliament]. Retrieved February 15 2021, from http://www.xinhuanet. com/world/xjpynghyj/wz.htm Yamada, G., & Palma, S. (2018). Is China’s belt and road working? A progress report from eight countries. Retrieved February 12 2021, from https://asia.nikkei.com/Spotlight/The-Big-Story/IsChina-s-Belt-and-Road-working-A-progress-report-from-eight-countries

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Yan, X. (2014a). China’s new foreign policy: Not conflict but convergence of interests. Retrieved February 12 2021, from https://www.huffpost.com/entry/chinas-new-foreign-policy_b_4679 425?guccounter=1 Yan, X. (2014b). From keeping a low profile to striving for achievement. The Chinese Journal of International Politics, 7(2), 153–184. https://doi.org/10.1093/cjip/pou027 Yu, H. (2017). China’s belt and road Initiative and its implications for Southeast Asia. Asia Policy, 24, 117–122. Zhang, J. (2015). China’s new foreign policy under Xi Jinping: Towards ‘Peaceful Rise 2.0’? Global Change, Peace & Security, 27(1), 5–19. https://doi.org/10.1080/14781158.2015.993958 Zhang, J., & Chen, J. (2017). Introduction to China’s new normal economy. Journal of Chinese Economic and Business Studies, 15, 1–4. https://doi.org/10.1080/14765284.2017.1289454 Zhou, W., & Esteban, M. (2018). Beyond balancing: China’s approach towards the Belt and Road Initiative. Journal of Contemporary China, 27(112), 487–501. https://doi.org/10.1080/10670564. 2018.1433476

Dr. Alessandro Albana is Associate Research Fellow at the Asia Institute in Bologna holds a Ph.D. in “Global and International Studies” from the University of Bologna. He was exchange Ph.D. student at China University of Political Science and Law (Beijing, 2016-2017) and Visiting Research Fellow at China Foreign Affairs University (Beijing, March 2019). He published in the fields of Asian Studies, Political Science and International Relations. His research interests include China’s domestic politics, social development and foreign policy, IR and political systems of East Asia. He collaborates with the Fudan Development Institute at Fudan University, in Shanghai. Antonio Fiori is Associate Professor of History and Institutions of Asia at the University of Bologna and President of the Asia Institute. He has been a visiting scholar at the United International College (Zhuhai, PRC), East-West Center (Honolulu, USA), Kyujanggak Center for Korean Studies (Seoul National University, Korea), Korea University and Ewha Womans University (Seoul). He has published widely in the fields of Inter-Korean relations, North Korea’s domestic and international affairs and China’s foreign policy. His latest co-edited book, titled The Korean Paradox: Domestic Political Divide and Foreign Policy in South Korea, has been published by Routledge in June 2019.

Chapter 13

BRI Manifesting the Rise of an Eastern Civilizational State and Its Implication to the World Sheng Zhang

Abstract Most scholars discussing BRI and IPS tend to simply see them as Chinese and American strategies aiming to outmaneuver the other in geopolitical competition. While this understanding certainly has an element of truth in it, it is probably not the entire picture. This paper not only aims to present the strategic considerations and plans of the BRI project of China and IPS of the U.S., but also to explore the profound significance of the grand change of world order brought by the revival of China and the implementation of the BRI. This paper aims to argue that the revival of China and the implementation of the BRI is an unprecedented grand change that has never been seen since Western colonialism invaded rest of the world 500 years ago. Since colonialist expansion 500 years ago, the world has always been filled with capitalist exploitation, Orientalist defamation, racial discrimination, and Western military expansion and oppression. The revival of China is the first time since 500 years ago that a nonCaucasian and non-Christian civilizational state challenging the domination of the West, and the BRI is the first time that an Eastern state uses massive economic projects, rather than using military power, to create a more favorable international environment for itself and to create a massive development platform for the Third War with little political conditions attached. This paper concludes that BRI aims to create a new world order in which capitals can freely flow and the developing world can tremendously benefit from economic development of the world, while IPS is the reaction from the West to prevent the rise of the non-Western world and to preserve Western hegemony. The competition between the BRI and IPS is one between geoeconomics and geopolitics, economic development and military domination, East and West, and most importantly a brand new future of the world order and the existing world order dominated and kidnapped by the West.

As China has been rapidly growing for approximately 40 years since the Chinese economic reform, China has made tremendous progress in countless fields including economic construction, political model exploration, ideological innovation, military S. Zhang (B) Chengdu Institute of World Affairs, Chengdu, Sichuan, China e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_13

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modernization, and projection of international influence. While China’s success, especially its economic miracle achieved by its own distinctive political model— Socialism with Chinese Characteristics—impressed the entire world and inspired many other developing countries, the West inevitably falls into deep anxiety that China’s revival might be a beginning of the rise of the Third World and thus Western hegemony in the contemporary world might be replaced by non-Western societies. This grand competition between the West, especially the U.S., and China along with many other non-Western developing states can be found in almost every region at this moment, and reflection of this grand competition in South Asia is the competition between the Belt and Road Initiative (BRI) proposed by China and the Indo-Pacific Strategy (IPS) of the United States. This paper aims to examine the competition between BRI and IPS from a grand historical level and essentially argues that the revival of China and the implementation of the BRI is an unprecedented grand change that has never been seen since Western colonialism invaded rest of the world 500 years ago. This paper also intends to contend that the competition between the BRI and IPS is one between geo-economics and geopolitics, economic development and military domination, East and West, and most importantly a brand new future of a more peaceful, prosperous, and mutually respectful world order and the existing world order dominated and kidnapped by the West.

Unprecedented Change Since 500 Years: What the Revival of China Means to the World As China is rapidly rising and the Western states are declining because of serious domestic structural problems, many Western scholars, especially American scholars, fall into serious worries about the coming end of neo-liberal world order (Peters, 2018). There is a large amount of Western literatures on this topic and even foreign policy of the U.S. is now deeply influenced by American anxiety of possibly losing its hegemony in the neo-liberal world order which it imposed on rest of the world. Because of their inherent limits as neo-liberalists trying to preserve the neo-liberal world order, those Western scholars merely trace this change as a recent challenge to neo-liberalism and only tend to analyze this change through the perspective of history since the end of World War II. In fact, this change is much more than a challenge to a world system established by the U.S. since 1945, but a much more profound challenge to Western domination. Chinese President Xi Jinping is actually one of the strategists who have realized the profundity of the current grand change caused by China’s revival and the West’s decline. In many speeches of him, Xi always stresses that “world today is marked by changes unseen in a century and the collective rise of developing countries” (“Xi Jinping Sends a Congratulatory Message,” 2019). In his analysis, President Xi traced back to the history of the “One Hundred Years of Humiliation” that China suffered since the first Opium War in 1840, and points out that China and the Third World’s

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influence in the world is unprecedentedly large today ever since last century. The collective rise of developing countries is indeed a very new phenomenon since the West especially Western imperialist states essentially dominated the world order for the last century, and today with China’s rapid revival and with the rapid economic growth of the BRICS countries, it is the first time that Third World developing countries have their representatives in discussing and revising the rules of international politics of the world. President Xi’s theory, I argue, is a profound judgment of the change of power dynamics of the contemporary world and the time scale of it can actually be expanded longer. I argue that the collective rise of the developing world marked by China’s rapid revival today is an unprecedentedly grand change of power dynamics since 500 years of colonialism, which means that the significance of historical narratives of the contemporary change of power dynamics should be traced back to the very beginning of Western colonialism in the fifteenth century. As Edward Said points out in his masterpiece Orientalism, since the West in its first time bypassed the technology development of the East through the Industrial Revolution, it formed a political, cultural, religious and even racial arrogance towards the East (Said et al., 2000). Such arrogance is not only deeply rooted in the Western academia’s orientalist attitude towards the East and the developing world, but also is always used by Western imperialist powers to justify their interventions, exploitations, and invasions to the world. The developing world has to cautiously realize that Western colonialism and imperialism have haunted the world for more than 500 years (for the Irish revolutionaries, they would even regard the starts of Western colonialism as 800 years ago, but in this article, I will use 500 years as the starting point since it is related to Western nautical expansion led by Columbus), and thus China’s revival today has remarkable historical significance since it is the first time since 500 years that an ancient but modernized Eastern civilization ever poses serious challenge to the hegemony of the Western and to the world order established by the West. Indeed, there were previous cases of successfully developed Asian countries and regions such as Japan, South Korea, and the so-called “Asian tiger economies”, but the development of all of those Asian states and regions failed to pose any serious challenges to the existing world order established and dominated by the West, especially the U.S. In fact, countries such as Japan and South Korea are American “allies” and their economic, political, and even military sovereignty is severely intruded by the U.S. U.S. military is on the territories Japan and South Korea regardless of the opinion of the local people, and South Korea does not even have its own Wartime operational Control while Japanese military has been totally re-armed by the U.S. In terms of economy, U.S. was able to force Japan to concede all of its core national interests such as signing the infamous Plaza Accord, and U.S. capital also controls leading South Korea companies such as Samsung. In terms of politics, U.S. is also able to intervene with domestic politics of those two countries and support the proU.S. candidates. Therefore, according to a standard valuing sovereignty, the rise of Asian countries such as Japan and South Korea cannot be regarded as previous cases of any Eastern states challenging a world order dominated by the West. The rise of People’s Republic of China, a state with absolute independence in terms of its

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sovereignty over its own military, politics, and economy, is truly the first case of rise of an Eastern state challenging the unjust world order kidnapped by the West since 500 years of Western colonialism. The revival of China, as Dr. Zhang Weiwei suggests, is a phenomenon of “rise of a civilizational state” and the success of China has unique insights for other non-Western states with rich civilization and histories in the subjects of successfully completing modernization while keeping distinctive traditions and independence (Zhang, 2012). The unique historical significance of the revival of China is also understood by the West. Although the U.S. refrain from unveiling its true intentions disguised under political correctness, but its latent civilizational and even racial consideration can be seen from the blatant speech of Kiron Skinner, the U.S. State Department’s director of policy planning: When we think about the Soviet Union in that competition [the Cold War], in a way, it was a fight within the Western family. This [Competition with China] is a fight with a really different civilization, and a different ideology, and the United States hasn’t had that before. And I think it’s also striking that it’s the first time that we will have a great power competitor that is not Caucasian. (Chan, 2019)

Skinner’s speech shows the latent and actual obsession of the West regarding the difference of civilizations and even races which the West pretends not to stress for merely political correctness propaganda’s reason, and this speech also reflects the West’s consciousness and anxiety of the fact that China’s revival is the first time that a non-Western society made up by non-Caucasian people is challenging the world order established by the West. To understand the historical meaning of the revival of China is extremely crucial because it can help one to realize what BRI and IPS as policies mean in terms of this grand change of power dynamics. Since the revival of China represents a new force in the platform of international relations challenging the world order established and dominated by the Western imperialist states, the BRI should be regarded as a political means of China the rising new force to unite the developing world in order to construct a more equal and justice world while the IPS should be regarded as a political tool of the established Western imperialist states to contain and even to confront the rise of non-Western states. Analyzing the specific goals and methods of BRI and IPS, one should have a more clear understanding of the different natures of those two proposals and policies.

BRI and IPS: Opening of a New Era Versus Attempt to Restore the Old Zero-Sum Game As aforementioned, from a perspective analyzing the historical significance of China’s revival, I argue that China’s revival today marks the collective rise of developing countries and thus it represents the first serious challenge of developing countries to the unjust world order established by the West since 500 years of Western

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colonialism. This judgment of the change of power dynamics, I argue, can also be seen from the BRI and IPS as individual proposals or policies. The BRI is a grand economic initiative proposed by China which represents the rising developing countries seeking a new model of equal and just development while the IPS is a mostly military and political policy imposed by the United States which represents the West’s attempt to contain China and to continue Western imperialist hegemony in the world. The BRI, announced by President Xi in 2013, is an ambitious project which is planned to “involve potentially 65 countries and 4.4 billion people” (Grieger, 2016). Until April 2019, China has signed 173 BRI cooperation documents with 125 countries and 29 international organizations in the world (“BRI Explainer,” 2019), which means that it actually received echo and support from a large number of countries which is almost twice as it initially planned to involve. Nepal, for example, has signed the Belt and Road Initiative cooperation document and both the Nepalese Communist Party and the Congress Party recognize the fact that BRI is a valuable opportunity for the future development of Nepal. The BRI, in my opinion, is a revolutionary form of foreign policy because it seeks to expand one countries’ international influence by peacefully facilitating the economic development of others unlike by military invasion as Western countries, especially the U.S., normally do. The BRI points out an alternative to the developing countries which struggled under Western world order for decades (Managa & Simelane, 2018). As I pointed out in an article of mine published at Oxford University, the BRI is the first time in the modern Chinese history that China uses massive economic project to actively construct a more favorable international environment for itself. China desires to use economic projects to enhance its relationship with neighboring states and to expand China’s soft power in East Asia, Central Asia, South East Asia, South Asia, and even further in the Middle East, Europe, and Africa. China also desires to economically empower and to support its international friends: It strives to economically support Pakistan through the China-Pakistan Economic Corridor, to support Russia through the construction of the “Silk Road on Ice”, and to support China’s African friends through massive investment and aids. Moreover, China wants to diversify its business partners and to better prepare itself from threats from the West, especially the United States (Zhang, 2019). Indeed, the BRI does have intrinsic elements striving to expand China’s international influence and to make a more favorable international environment for itself, but the revolutionary characteristics of the BRI is that the BRI is a new form of foreign policy which depends on peaceful economic developments to achieve China’s goal instead of depending on military invasions and wars which the West has been frequently using until today. As scholars Jean-Marc F. Blanchard and Colin Flint argue, the BRI strives to construct “a new form of political economic development based on interconnectivity or flows rather than territorial control” (Blanchard & Flint, 2019). The BRI, as a new form of strategy based on geo-economics, has the potentials of creating such as “new form of political economics” and such a new economic order would truly benefit the developing world including South Asian states. The BRI will also set a profound example for future intra-states competitions in the future: Rather than the traditional way of competing for international influence based on which country has larger capacity in launching

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and winning wars, the future way of competing for international influence could be a more peaceful one focusing on which country has the ability to make more contribution to the developments of the international community. China’s global strategy can be one based on facilitating the development of high-speech railroad in the world rather than exporting wars, poverties, and instabilities as the West does (Xu, 2018). A scenario in which China and U.S. compete in various aspects centered on economic developments rather than military possibilities would possibly be a better blueprint that the BRI is striving to realize. Comparing to the revolutionary profundity of the BRI, the nature of the IPS tend to be much more lackluster and commonplace. Using a Marxist term, one can describe the IPS as a reactionary and counter-revolutionary policy of the old established power to confront the rising new forces. As Nepalese famous scholar Yubaraj Sangroula points out, the IPS is a policy of the U.S. to contain the rise of China and to defend the old world order (Sangroula, 2019). The IPS, unlike the BRI, is mostly a political and military scheme and it has a very clear strategic target which is China. The goal of the U.S. is to contain Chinese influence in Asia through the IPS and one must realize that fact that the well-being of the South Asian people has never ever been the concern of the IPS. The goal of the U.S. is to cause losses of China and whether South Asian people gain or loss in the IPS simply does not matter to the U.S. at all. While the BRI pledges to help South Asia benefit from the collective programs, the U.S. does not provide any comparable massive economic plan in lieu of the BRI but simply strives to sabotage the BRI. For the U.S., the best economic system is the neo-liberal system that has been dominating the world for decades, and South Asian people know the best about how this system impoverished South Asia. The IPS, as a policy imposed by U.S. imperialism to maintain the unjust world order established by the West, seeks to impose Western influence through military alliances as the West has been doing for centuries. While the BRI could start a new form of intra-states competition in which states compete by making contributions to the economic development, the IPS attempts to drag human beings into the old and violent military way of solving intra-states disputes by using the old tricks of balance of power, alliances and counter-alliances, and wars. The competition between BRI and IPS, I argue, should be considered as a competition between old and violent way of great power competition through military means and new and revolutionary way of competition through economic developments. The IPS is a very dangerous attempt of the old world order to attempt to prolong its longevity by risking the possibility of war between great powers of the world. To support IPS essentially means to support the old way of violent great power competition that has been nightmares of war haunting human beings for centuries.

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Conclusion In summary, the revival of China is the first time that a non-Caucasian and nonChristian civilizational state challenging the domination of the West since 500 years of Western colonialism, and the BRI is the first time that an Eastern state uses massive economic projects, rather than using military power, to create a more favorable international environment for itself and to create an alternative development model for the developing countries to examine. The BRI not only attempts to create a new world order in which capitals can freely flow and the developing world can tremendously benefit from economic development of the world but also would possibility redefine the form of great power competition and create a new example in which states compete for international influences through making contributions to the development of the world. The IPS, on contrary, is a reactionary and counter-revolutionary reaction from the West to prevent the rise of the non-Western world and to preserve Western hegemony. The competition between the BRI and IPS is one between geo-economics and geopolitics, economic development and military domination, East and West, and most importantly a brand new future of the world order and the existing world order dominated and kidnapped by the West. It is actually surprising to me to see that there is such a widespread discussion in South Asia on the comparison between the BRI and IPS and there is a phenomenon that many South Asia experts are hesitating whether to embrace the BRI or to follow the IPS. South Asia, a region with splendid history of great civilizations and a region with sorrow memories caused by Western colonialism and imperialism, should have the most vivid and comprehensive understanding of the imperialist nature of the West and of the current unjust world order established by the West and for the West. History and contemporary facts have clearly proven that the Western system is not the solution to the development problems of South Asia today and in fact Western domination itself is the cause of the problems. Therefore, it is rather shocking that a widespread hesitation exists among some South Asian scholars on the topic of BRI and IPS. It is extremely crucial for us to remember that when the White colonizers landed in the land of North America, they divided the Native American tribes and used certain tribes against other Native American tribes. In the end, they even wiped out those tribes that once were their allies and committed probably the largest genocide in the history of the world—the Genocide of Native Americans. Today, the West is using exactly the same strategy and names it “Indo-Pacific Strategy”. It attempts to divide the Asian states and use Japanese, Indians, Vietnamese, Filipinos, and many others to fight the Chinese while the West can benefit from this conflict and strike its “allies” in the IPS later. May the brilliant strategists of South Asia would never be blinded by small short-term baits offered by the West and may South Asian states choose a path of pursuing independence, peace, and prosperity of Asia.

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References Blanchard, J.-M. F., & Flint, C. (2019). The geopolitics of China’s maritime silk road. Development path for Africa. Project Muse. https://doi.org/10.1080/14650045.2017.1291503.Initiative. Geopolitics, 22(2), 223–245 (April 2017). “BRI Explainer: What Is the Belt and Road.” People’s Daily Online. April 23, 2019. Retrieved July 29, 2019, from http://en.people.cn/n3/2019/0423/c90000-9570953.html Chan, T. F. (2019). State Department Official Says China threat is the first time the U.S. has a great competitor that is not Caucasian. Newsweek. May 02, 2019. Retrieved July 25, 2019, from https:// www.newsweek.com/china-threat-state-department-race-caucasian-1413202. Grieger, G. (2016). One belt, one road (OBOR): China’s regional integration initiative. European Parliament Research Service, July 7, 2016, 1–12. July 7, 2016. Retrieved December 5, 2018, from http://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_B RI(2016)586608 Managa, L. R., & Simelane, T. (2018). Belt and road initiative: Alternative. Springer Singapore. Peters, M. A. (2018, April). The end of neoliberal globalisation and the rise of authoritarian populism. Educational Philosophy & Theory, 50(4), 323–325. https://doi.org/10.1080/00131857. 2017.1305720 Said, E. W., Bayoumi, M., & Rubin, A. (2000). The Edward said reader. Vintage Books. Sangroula, Y. (2019). South Asia China geo-economics. Lex & Juris Publications. Xi Jinping sends a congratulatory message to the coordinators’ meeting on Implementation of follow-up actions of the Beijing summit of the forum on China-Africa Cooperation (FOCAC). Ministry of Foreign Affairs of the People’s Republic of China. Ministry of Foreign Affairs of the People’s Republic of China, June 25, 2019. https://www.fmprc.gov.cn/mfa_eng/wjdt_665385/ wshd_665389/t1676129.shtml Xu, F. (2018). The belt and road: The global strategy of China high-speed railway (1st ed.). Zhang, S. (2019). A new pattern of rivalry: Reconsider the future of Sino-U.S. relations beyond the ‘Thucydides Trap’. In C. H. Yuan & X. L. Li (Eds.), Proceedings of the 2nd International Conference on Economic Management and Green Development (ICEMGD 2019), Oxford, United Kingdom, August 03–04, 2019. https://doi.org/10.23977/icemgd.2019.010 Zhang, W. (2012). The China wave: Rise of a civilizational state. World Century Publishing Corporation. ProQuest Ebook Central. https://ebookcentral.proquest.com/lib/gwu/detail.action?docID= 919126

Sheng Zhang is a Research Fellow of the Chengdu Institute of World Affairs, China. He is also an Honorary Expert Advisor of the Jeevraj Ashrit Foundation and a research fellow from International Peace Institute-Nepal. He is currently studying at Harvard University in the U.S. and he was a political commentator for RT America (Russia Today America)’s television station in the Washington D.C. Zhang has published a number of academic articles on journals and political analysis articles on influential media in various states such as China (including in Chinese Mainland, Taiwan, and Hong Kong), the U.S., Russia, Nepal, Ireland, Japan, Chile, and Iraq.

Chapter 14

Sitting on the Fence? Australia’s Balancing of the Belt and Road Initiative and Indo-Pacific Strategy in the New Multipolar World System Paul Antonopoulos, Arturo Gallegos García, and Drew Cottle Abstract Twenty-first century world politics is increasingly multipolar with the rise of China, Russia and other regional powers. In this new global and regional context, Australia’s relations with the United States (US) and China are increasingly important. Since its signing of the ANZUS security alliance in 1951, Australia has followed US foreign policy. Australia must now attempt to continue to follow its principal military ally while being increasingly economically reliant on China, its major export market. Although Australia is an island continent separate from Southeast Asia, its trade and wealth are dependent on Asian markets, especially China. Australia continues to serve a policing role in the Asia–Pacific region on behalf of the US. It is for this reason that Australia plays a crucial security role in Washington’s Indo-Pacific Strategy. Nevertheless, as China’s Belt and Road Initiative continues to develop globally and involves Australian infrastructure, Australia’s US dependency and foreign policy must be re-evaluated to focus on Australia’s positioning in the Asia–Pacific region. This chapter explores Australia’s precarious position poised between US geo-strategy and China’s global economic development. Although China is Australia’s primary economic partner, Australia is critical of China’s human rights record and its military expansion in the South China Sea and continues to serve the military security strategy of the US in the Indo-Pacific region. The twenty-first century heralded the arrival of the “Asian Century”, and Australia is both a key country in the Asia–Pacific region and in the struggle between China’s Belt and Road Initiative the US Indo-Pacific Strategy for dominance.

P. Antonopoulos (B) Aristotle University of Thessaloniki, Thessaloniki, Greece A. G. García Friedrich-Schiller University, Jena, Germany D. Cottle Western Sydney University, Penrith, Australia © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_14

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Introduction The twenty-first century, is described by Western economists, political analysts and media, as the “Asian Century” (Kawai, 2017). In a study commissioned by the Asian Development Bank (2011) titled: “Asia 2050: Realizing the Asian Century”, Asian countries will continue to rapidly develop and eventually account for more than half of global GDP by 2050. The Asian Development Bank explains that the Asian Century connects Asia’s past successes with its future where Asia’s GDP (at market exchange rates) will increase from USD17 trillion in 2010 to USD174 trillion in 2050 (Ibid.). China, India, Indonesia, Japan, South Korea, Thailand and Malaysia will be the leaders in Asia’s march to prosperity, and with a per capita GDP of USD40,800, it is estimated that by 2050 Asia will have achieved income levels similar to those of contemporary Europe and here would be nopoor Asian countries (those with average per capita GDP of less than USD 1,000) (Ibid.). A PwC report of 2017 predicted that by 2050 China would account for 20% of the world economy, with India at 15% and the U.S. at 12%, down from 16% in 2016. To respond to this global shift of economic dominance from the Atlantic to Asia, U.S. Secretary Hillary Clinton (2011) on November 10, 2011 stated that “The 21st century will be America’s Pacific century, a period of unprecedented outreach and partnership in this dynamic, complex, and consequential region”. Clinton explained that in “America’s Pacific Century” (APC) the U.S. must take leadership and ensure freedom of navigation in the South China Sea to counter North Korea’s “provocations and proliferation activities to promoting balanced and inclusive economic growth (Ibid.)”. She revealed that in her strategy for American dominance of the Asia–Pacific by using Washington’s ally, Australia, along with Japan, South Korea, Thailand and the Philippines, to geo-politically advance U.S. efforts in Asia-Pacific as Australia was described to have “underwritten regional peace and security for more than half a century”, and because Australia would also “leverage our regional presence and enhance our regional leadership at a time of evolving security challenges (Ibid.)”. In 2011, the Obama administration recognized that U.S. focus must shift towards Asia, which would culminate in the APC. The APC was the predecessor of the IndoPacific Strategy (IPS) which was not unveiled until June 2019. The administration of U.S. President Donald Trump continues Clinton’s APC by stating in the IPS report that Japan, South Korea, Australia, the Philippines and Thailand are to serve Washington’s demands in Asia Pacific because “these alliances are indispensable to peace and security in the region and our investments in them will continue to pay dividends for the United States and the world, far into the future (DoD, 2019)”. However, the world is no longer bipolar as it was in the Cold War, or unipolar as it appeared to Washington after the Cold War. It has become multipolar with the rise of China, Russia and other regional powers. In this new changing global and regional context, Australia’s relations with the U.S. and China are increasingly important either geo-strategically or economically. Australia can no longer be subservient to and reliant upon one dominant power. Since its signing of the ANZUS security alliance in 1951 (Brown & Rayner, 2001), Australia has followed US foreign policy into wars

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in Asia and the Middle East like those in Vietnam and Iraq. However, Australia must now attempt to balance the long-standing relationship with its principal military ally, the US, while being increasingly economically dependent upon China, its biggest trading partner (DFAT, 2019). As an island continent separate from Southeast Asia, Australia’s major trading partners, markets and the source of its continuing wealth are major Asian countries led by China. Australia continues to serve a policing role in the Asia–Pacific region on behalf of the U.S which began in the first years of the Cold War. Because of this existing strategic responsibility, it is expected that Australia will continue this crucial security role within the framework of Washington’s Indo-Pacific Strategy. Nevertheless, as China’s Belt and Road Initiative (BRI) continues to develop globally and involves Australian infrastructure, such as the Chinese-leased Port of Darwin (Commonwealth of Australia, 2016), Australia’s dependency on the US and determination of its foreign policy must be re-evaluated to focus on Australia’s positioning in the Asia–Pacific region. This chapter explores Australia’s strategic position as being the only country straddling both the Pacific and Indian Oceans, that is also poised between a commitment to U.S. geo-strategy and an increasing reliance on China’s global economic development. Although China is Australia’s primary economic partner, Australia is not a major export market or investment site for China. Recently, Australia has been critical of China’s so-called human rights abuses of Uyghurs in Xinjiang, its construction of military installations in the South China Sea as a violation of international shipping and Chinese espionage in Australia. At the same time, Australia continues to serve the military security strategy of the U.S. in the Indo-Pacific region. The twenty-first century was heralded as the arrival of the “Asian Century”, and Australia can be seen as both a key country geographically, in the Asia–Pacific region and in the struggle between China’s Belt and Road Initiative and the US Indo-Pacific Strategy for dominance.

Russia’s Development of the Far East With the world economy shifting in Asia’s favour, Russia has prioritized the development of its Far Eastern regions. Russian President Vladimir Putin has been offering free land in Far Eastern Russia for Russian colonists, stating: “We should work with regional authorities, so that land plots are allocated in areas with at least minimal infrastructure (RT, 2016).” With Putin creating incentives for colonists to populate the Far East of Russia to boost the vast region’s small population of under seven million people (Unnikrishnan, 2014), it demonstrates Russia has recognized the necessity of a population increase to fully engage in the “Asian Century”. The economic and political importance of Asia in the twenty-first century has forced the leaders of former European colonial countries to turn their eyes towards Asia. French President Emmanuel Macron’s stated on a Facebook post in August 2019: “progress on many political and economic issues is evident, for we’re trying to

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develop Franco-Russian relations. I’m convinced that, in this multilateral restructuring, we must develop a security and trust architecture between the European Union and Russia. (Moscow Times, 2019)”. He repeated French President General de Gaulle’s phrase that Europe stretches “from Lisbon to the Urals”, adding “We believe in Europe that stretches from Lisbon to Vladivostok (Ibid)”. Vladivostok is a major maritime city on Russia’s Pacific coast, close to the Chinese and North Korean border and nearly 9000 km away from Moscow, and more than double the distance of Moscow to New Delhi. Despite being a world away from Europe, Macron attempts to extend Europe to these regions so that the European Union, to which he firmly is committed too, can gain undisturbed rail and road access to Asia. Russia is open to investments from all partners so much so that Japan is investing in the region despite technically being at war since 1945, as a peace treaty was never signed over the disputed Kuril Islands, in which Japan claims the four southernmost islands that are currently under Russian jurisdiction (Antonopoulos, 2019). This is in stark contrast to Australia which has since 1 September 2014 maintained sanctions against Moscow because of the Russian “threat to the sovereignty and territorial integrity of Ukraine (DFAT, 2015)”. Because Canberra has demonstrated to its Asian neighbours that it is willing to engage in economic aggression over issues continents away from Australia to serve Washington’s geopolitical interests, it makes the wider region more distrustful of it and consolidates the idea that Australia is the US’ guard dog of Asia–Pacific. The purpose of highlighting Russia’s investment and development of its Eastern regions is to demonstrate Canberra’s lack if realization of the “Asian Century”. Because policymakers in Canberra continue to believe and to behave as if the world was still in a U.S.-dominated unilateral system, it had not initially seen the necessity to develop the country’s northern cities so that Australia can more easily economically engage with Asia. The key sectors of the Australian economy are foreign owned and controlled, and economically, Australia is almost entirely reliant on China to buy its major exports. Australian capitalism cannot even raise the capital for infrastructural projects in its major cities.

The BRI Can Connect Darwin to Vladivostok The Australian city of Darwin in the Northern Territory and Vladivostok are easily comparable if we ignore the significant differences in climate. They are both cities in sparsely populated regions that are resource-rich and in positions to easily exploit trade and other economic opportunities in East Asia, particularly with China. Beijing identified Darwin as a port city of critical strategic importance and attained a 99year lease on the Port of Darwin in 2015 (Commonwealth of Australia, 2016). This demonstrates that despite Canberra’s frequent denunciation of China’s so-called human rights abuses. Beijing is still willing to work with any state as a partner in the building of the mutually beneficial BRI, from Italy in Europe, to Kenya in Africa to Venezuela in Latin America. This is in conjunction with Canberra having

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never made any major economic program historically to develop and to populate the sub-tropical northern Australia. Nearly two decades ago, Darwin, because of its location, was identified as having the potential to become a leading economic centre in the Asia–Pacific and gateway for Asia to the rest of Australia. In 2000, the Australian Minister for Trade, Mark Vaile, stated: Through its geographical proximity and historical connections, the Northern Territory has a valuable role to play, and many rewards to reap, in leading Australia’s economic integration in the Asia-Pacific. And, of course, Darwin has an important part to play in that process as a gateway to Asia. Darwin’s role as a gateway to Asia is well understood by the NT Government of Mr. Burke and his colleagues, particularly his Minister for Asian Relations and Trade, Mr. Manzie. The irregular high-level visits to countries in the region and showcase events like the NT Expo are excellent ways to capitalize on the economic recovery of our Asian neighbours (Vaile, 2000).

From this period, Canberra has never planned nor prepared any program to develop Darwin to become a regional hub in the “Asian Century”. The leasing of the Port of Darwin to a Chinese corporation will prove to be a blunder as the city provides the shortest trade and transportation route between any Australian capital and Asia. Eight national capitals, 36 trading ports, 69 international airports and nearly half a billion people are within four hours flight from Darwin, compared to the approximately nine hours from Sydney. It is not hard to see the importance the development of Darwin should have on Canberra’s domestic agenda. With China entering one of the most strategic areas of Australia, it demonstrates that Australian governments, past and present have proven incapable of moving Australia forward to the new economic order emerging in Asia to serve Australia’s interests. No other port in northern Australia has the geographic advantages of Darwin’s proximity to Asia. Any future plans to develop northern Australia economically, must concentrate on Darwin as an entrepot hub as well as to build a new port. The other Australian ports on the north-eastern coast of Australia are located in Cairns and Townsville are a greater nautical distance from Asia and the Great Barrier Reef restricts their access to shipping. Darwin is in a unique position to engage economically with Russia through its port in Vladivostok. The Chinese lease of the Port of Darwin is not the only case of China’s endeavour to extend its influence over Asian ports. China has in recent years has either leased or developed many ports as part of the BRI, including Sri Lanka’s Hambantota Port, Pakistan’s Gwadar Port, a port in Djibouti, and Bangladesh’s Anwara, Laem Chabang in Thailand, Sihanoukville in Cambodia, and Batam and Kuala Tanjung in Indonesia (Wade, 2015). These BRI developments have provided China with a monopoly on maritime trade routes and ports in Asia and the potential for Darwin and Vladivostok to be economically engaged through these two port cities would essentially be straightforward. Such a maritime route will directly connect Russia’s and Australia’s economy.

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Australia’s Role in the IPS The only potential hindrance to this economic development between Darwin, Vladivostok, and the BRI in maritime straits of Asia is Canberra’s unwavering security alignment with Washington’s stance on Russia. With Washington prioritizing the Asia–Pacific increasingly in the twenty-first century because of strategic shift in global power with the unrelenting rise of China, Australia has a desire to have a strong influence in the region which is increasingly coming under Chinese, and potentially, Russian influence through the Port of Vladivostok. As Darwin is strategically located, the U.S. has identified the city as critical to its continuing dominance in Asia–Pacific. According to a U.S. Congress report in 2016 it was suggested that 1,350 American Marines to 2,500 should be based in Darwin as it is both “important for both nations and for the credibility of the U.S. rebalance (CSIS, 2016)”. This rebalance has been described by the U.S. Department of State as “America’s Pacific Century”, in which the U.S. will seek to contain the expansion of Chinese and, and potentially, Russian influence in the region through security alliances with Australia, the Philippines, Japan, South Korea and Thailand (Ibid.). In July 2019, that 2,500 American Marine number was achieved (Greene, 2019). When considering that Australia has been identified as a key point in the BRI with China’s control over the Port of Darwin while also being Australia’s largest trading partner, while the U.S. is Australia’s supposed security guarantor, it appears Canberra will have to strategically reassess position in the changing world order. It is for this reason that the Liberal Party federal member for Canning and the chair of the parliamentary joint committee for intelligence and security, Hastie (2019), said that: Australia must now, somehow, hold on to our sovereignty and prosperity. We must balance security and trade. But most importantly, we must remain true to our democratic convictions while also seeing the world as it is, not as we wish it to be. This will be immensely difficult. It is impossible to forsake the U.S., our closest security and investment partner. It is also impossible to disengage from China, our largest trading partner. This is the central point: almost every strategic and economic question facing Australia in the coming decades will be refracted through the geopolitical competition of the U.S. and the PRC [People’s Republic of China].

However, it is China’s patience in the face of growing Australian aggression, rather than Canberra successfully balancing relations with Beijing and Washington, that ensures Australia–China relations continue. Although Australia is integrated into the BRI through the Port of Darwin, it is also actively working to counter Chinese interests in its so-called zone of influence (SCMP, 2019). Australia has limited autonomy from Washington that allows it to act as a regional hegemon over the small island nations of the Southwest Pacific (Brissenden, 2013). One Pacific nation, Vanuatu has been attempting to move away from its dependent relationship with Australia by establishing closer economic and diplomatic ties with China. Korybko (2018) explains that the Australian media’s unfounded rumour of China’s plan to build a secret military base in Vanuatu, just hours from the

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coast of Australia “was a carefully crafted signal designed to send the message that Vanuatu must immediately cease its ‘balancing’ strategy with China and return to the Australian hegemonic fold, which has since seen the two lopsided “partners” negotiate a prospective military deal during Prime Minister Charlot Salwai’s trip […] to Canberra”. This action taken by Australia is a demonstration of its willingness to conduct antiChinese containment functions to protect its interests in the South Pacific. Canberra views the Southwest Pacific as its historic sphere of influence which must be quarantined from China’s investment and development assistance. The U.S.’ so-called “Lead From Behind” paradigm attempts to maintain U.S. unilateralism in the face of changing multipolar trends (Korybko, 2015), as Washington uses its allies like Australia to enforce its interests in certain regions. The U.S. delegates ambitious leadership responsibilities to regional partners who have an interest in maintaining the U.S.-led international system such as Japan in East Asia and Australia in the Southern Seas and Oceans. This would suggest that at least at government level there is a significant hostility towards China if we consider the constant accusations of China’s human rights abused by Canberra and the introduction of anti-foreign interference legislation (Hutchens, 2018). This legislation also infringes on the rights of Australians, under the guise of being able to ban Huawei from building Australia’s 5G infrastructure and tightening foreign investment screening (Grigg, 2019). In contrast, leading Australian economic interests are focussed solely on taking advantage of the financial opportunities presented by China’s rapid economic growth (Kehoe, 2018). As Australia followed the U.S. into invading Korea, Vietnam, Afghanistan and Iraq, Canberra has already demonstrated a long commitment to using military force at the behest of Washington, including in the Asia–Pacific region. This again would only heighten suspicions that Asian countries have against Australia, which can hinder economic opportunities. With Australia constantly criticizing China’s supposed human rights abuses, making efforts to resist Chinese economic expansion in the South Pacific, and continually following the U.S. to war, it is expected that Australia will play a key role in the IPS, serving a policing role.

Australia, India, Japan and the IPS In the Indo-Pacific Security arrangement, there is an expectation by Washington that the security of the Indian Ocean region will be the joint responsibility of both India, which is a major naval power, and Australia. They must cooperate closely to carry out Washington’s designs on the region. This aspect of the IPS may present Australia with new opportunities to continue to diversify its economy by strengthening its relations with India, a rival of China. India is also proving to be a potential counterbalance to China’s newly won economic dominance in the Indo-Pacific region. The Indian Prime Minister Narendra Modi has recently spearheaded trilateral cooperation with Japan and Sri Lanka to

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counterbalance China in key regions. India, Japan and Sri Lanka signed an agreement on 28 May 2019 to build a new container terminal in the port of Colombo, close to the Chinese-controlled Hambantota Port. It will be a concrete demonstration to China that New Delhi, and Tokyo, as independent Asian powers, have experience in cooperating in a trilateral format (Srinivasan, 2019). With the BRI developing Sri Lanka, India and Japan are creating a new economic dynamic to match China’s economic strength. They are also involved in development programs in the Russian Far East, an area which is dominated by Chinese investments and businesses. Japan’s current investments in the Russian Far East’s economy exceeds USD15 billion. It will continue to grow according to the Japanese Prime Minister Shinzo Abe. India also expressed its interest in investing in the Russian Far East on the eve of the 2019 Vladivostok 5th Eastern Economic Forum (Antonopoulos, 2019). India has chosen to remain the only South Asian country not involved in the Belt and Road Initiative (BRI). India has turned to the U.S. as China continues to rapidly develop India’s neighbouring countries, especially Nepal and the Indian rival Pakistan (Ibid.). This is to show that India is a capable partner in trilateral affairs to protect its interests, despite China having effectively encircled India, the leading regional power of South Asia, through the BRI. Therefore, it can be expected under IPS that diplomatic and perhaps military relations between Australia, India and the U.S. will also deepen as they attempt to counterbalance China’s growing economic dominance in the region. With Australia serving a police role in the South Pacific for the U.S., it might be that India will adopt a similar security role in South Asia and as Japan will be expected to fulfil in East Asia. This may be the goal of Washington’s IPS framework of operations where its leading members engage in closer regional security cooperation. Thomas S. Wilkins of the Japan Institute for International Affairs argues that: Despite the vehement protestations by the Australian government that it is “not about China”, for all the parties leading the concept it evidently “is about China”. However, it is also more than this. The Indo-Pacific region is faced by a plethora of non-traditional security challenges, such as piracy, terrorism, climate change and natural disasters, for example. A more proactive role for Australia and its partners on this front will surely prove beneficial, as was earlier demonstrated through the successful quadrilateral HD/AR response to the Indian Ocean Tsunami in 2004. So, it is not “only about China”.

Although the four countries can cooperate on fighting piracy, terrorism, pollution and providing disaster relief, the underlying driver of this quadrilateral format is the effort to counterbalance China’s economic dominance in the region. Therefore, it cannot be denied that the central dynamic of their cooperative endeavours is to resist the BRI. The U.S. Indo-Pacific Strategy Report asserts that China’s aim is to “reorder the region” and that the Indo-Pacific Strategy is essentially the US plan for containing the rise and expansion of China’s regional power (Strating, 2019). The report emphasized the importance of “networked security architecture to uphold the international rules-based order”, and outlined US expectations that its allies and partners will contribute to regional security on a number of fronts, including through adequately

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resourcing their own defence, strengthening interoperability with the US, promoting Indo-Pacific initiatives, and upholding the so-called “rules-based order” (Ibid.). The fundamental problem for the IPS report is its insistence on unquestioned/assumed “rules-based order.” As the U.S. operates globally in a unilateral manner, a “rules-based order” is certainly not in line with international laws. We should consider this question of a “rules-based order” in relation to the U.S. invasion of Iraq in 2003 and its current and continuous sanctions against North Korea, Russia, Syria, Iran and Venezuela. The U.S. calls for a “rules-based order” will do little to alleviate Chinese concerns and will only increase deeper suspicion of Australia, Japan and India by their involvement in the IPS.

Conclusion Australia is caught in a contradiction of its making. It maintains a dependent military alliance with the United States while becoming increasingly dependent economically on China, its major trading partner. Canberra’s decision to become a pivotal member of Washington’s IPS will mean that it is part of an alliance that seeks to dominate Asia and contain Russia and China. Such a decision will hinder relations and trust with Asian countries, and serves to potentially exclude Australia from trade opportunities with not only the wider region, but Russia’s Far East. As time passes, Canberra will find it more difficult to maintain trade relations with China and its neighbours in Asia while balancing its alignment to a Euro-American centric security policy for the India-Pacific region, while its commitment to EuroAmerican centric policies may lead to the denial of trade opportunities in the region because of sanctions.

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Clinton, H. (2011). America’s Pacific Century. U.S. Department of State, November 10. https:// 2009-2017.state.gov/secretary/20092013clinton/rm/2011/11/176999.htm Commonwealth of Australia. (2016). Interim Report Foreign investment review framework. Parliament of Australia, February 4. https://www.aph.gov.au/Parliamentary_Business/Committees/Sen ate/Economics/Foreign_Investment_Review/Interim_Report Department of Foreign Affairs. (2015). Russia/Ukraine Sanctions Regime. https://dfat.gov.au/ international-relations/security/sanctions/Documents/sanctions-snapshot-russia-ukraine-autono mous.pdf Greene, A. (2019). America’s $300 million push to expand naval facilities in northern Australia. ABC News, July 28. https://www.abc.net.au/news/2019-07-29/americas-push-to-expand-navalfacilities-in-northern-australia/11354926 Grigg, A. (2019). No such thing as a private company in China: FIRB. The Australian Financial Review, January 16. www.afr.com/policy/foreign-affairs/no-such-thing-as-a-private-companyin-china-firb-20190116-h1a4ut Hastie, A. (2019). We must see China—The opportunities and the threats—With clear eyes. The Sydney Morning Herald, August 8. https://www.smh.com.au/politics/federal/we-must-see-chinathe-opportunities-and-the-threats-with-clear-eyes-20190807-p52eon.html Hutchens, G. (2018). Sweeping foreign interference and spying laws pass Senate. The Guardian, June 28. https://www.theguardian.com/australia-news/2018/jun/29/sweeping-foreign-interfere nce-and-spying-laws-pass-senate Kawai, M. (2017). Will the 21st century be an Asian century?: A global perspective. ERINA— Economic Research Institute for Northeast Asia, Discussion papers1702. Kehoe, J. (2018). Australia-China relationship on a ‘bit of a knife edge’. The AustralianFinancial Review, March 5. https://www.afr.com/business-summit/australiachina-relationship-on-a-bit-ofa-knife-edge-20180304-h0wz5u Korybko, A. (2015). Lead from behind: How unipolarity is adapting to multipolarity. Sputnik, January 29. https://sputniknews.com/columnists/201501291017517136/ Korybko, A. (2018). Australia is attempting to “Contain” China. Oriental Review, July 2. https:// orientalreview.org/2018/07/02/australia-is-attempting-to-contain-china/ RT. (2016). Putin offers free land for citizens & foreigners in Russia’s Far East, May 5. https:// www.rt.com/business/341892-far-east-land-infrastructure/ SCMP. (2019). Australia admits failings in Pacific, vows to counter China’s influence, March 9. https://www.scmp.com/news/asia/australasia/article/2189315/australia-admitsfailings-pacific-vows-counter-chinas Srinivasan, M. (2019). Sri Lanka, Japan, India sign deal to develop East Container Terminal at Colombo Port. The Hindu, May 28. https://www.thehindu.com/news/international/sri-lankajapan-india-sign-deal-to-develop-east-container-terminal-at-colombo-port/article27273794.ece Strating, R. (2019). Australia, Chinese Warships and the New US Indo-Pacific Strategy. Australian Institute of International Affairs, June. www.internationalaffairs.org.au/australianoutlook/austra lia-chinese-warships-and-the-new-us-indo-pacific-strategy/ The Department of Defense. (2019). Indo-Pacific strategy report: Preparedness, partnerships, and promoting a networked region, June 1. https://media.defense.gov/2019/Jul/01/2002152311/-1/1/1/DEPARTMENT-OF-DEFENSE-INDO-PACIFIC-STRATEGY-REPORT-2019.PDF The Moscow Times. (2019). Russia is ‘Deeply European,’ France’s Macron Says in Russian, August 20. https://www.themoscowtimes.com/2019/08/20/russia-is-deeply-european-francesmacron-says-in-russian-a66947 Unnikrishnan, N. (2014). Russian Far East & opportunities for India. Observer Research Foundation, January 31. https://www.orfonline.org/research/russian-far-east-opportunities-for-india/ Vaile, M. (2000). Darwin and the Northern Territory—The Exports Gateway to Asia. Trade Minister, July 14. https://trademinister.gov.au/speeches/2000/000714_gateway.html#targetText= Through%20its%20geographical%20proximity%20and,as%20a%20gateway%20to%20Asia

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Wade, G. (2015). Port of Darwin: This is about more than China’s economic interest. ABC News, November 24. https://mobile.abc.net.au/news/2015-11-24/wade-the-darwin-port-is-ano ther-link-in-chinas-expansion/6967640?pfm=sm

Paul Antonopoulos is a Ph.D. Candidate at the Aristotle University of Thessaloniki. His main research interests are Multipolarity and East Mediterranean-MENA geopolitics. He regularly features in international media, is the current Bureau Chief for Greek City Times in Athens and has presented papers at international conferences in Australia, Brazil Greece and Pakistan. Outside of the East Mediterranean-MENA region, his academic publications also include the geopolitics of East Africa, South America and East Asia. Arturo Gallegos García is a lecturer at the Law Faculty of Friedrich-Schiller University in Jena, Germany. His main research are constitutional law and direct democracy, as well left-wing political movements and international politics. He regularly features in Spanish-language media as a political commentator, as well as English and German-language media. Dr. Drew Cottle is an Adjunct Fellow in History and Politics at Western Sydney University whose current research interest is the global rivalry between the United States and China in the Age of Multipolarity. Over the course of more than two decades, he has published eight books and many more book chapters, journal articles and conference papers.

Chapter 15

Belt and Road Initiative (BRI) and Indo-Pacific Strategy (IPS): Challenges and Opportunities for Sri Lanka Asantha Senevirathna Abstract Sri Lanka is an island strategically located in the Indian Ocean. Due to its strategic location, it has attracted the interests of global powers in the twenty-first century. Sri Lanka has become a major partner to China’s Belt and Road Initiative (BRI) and several large-scale development projects are being implemented by the Chinese in the country. The Chinese investments related to port development has given it access to strategically important Colombo and Hambantota ports. The growing Chinese influence in Sri Lanka has raised geopolitical concerns among the United States and India and others due to their suspicion of BRI. The United States, India, Japan and Australia are mainly collaborating to counter the influence of BRI in the Indo-Pacific region. The Indo-Pacific Strategy (IPS), under the leadership of the United States and with the collaboration of other powers in the region, has proposed Sri Lanka with many development initiatives as a counterbalance to BRI. As a small state located in a strategically important position, Sri Lanka is now faced with challenges and opportunities presented by the BRI and IPS. The study examines how Sri Lanka should address the geopolitical challenges posed by global powers via BRI and IPS, and how to gain from opportunities that these initiatives.

Introduction Sri Lanka is an island that is in a strategically important location within the Indian Ocean Region (IOR). During the times of the colonial era, Sri Lanka became an important focal point for many of the European powers to consolidate their influence in the IOR. The British Empire which ruled the island till its independence in 1948 made it an important maritime trade hub in the region. Largely due to the influence of the British, Sri Lanka inherited strategically important maritime infrastructure facilities such as the Port of Colombo and Port of Trincomalee. At present IOR has A. Senevirathna (B) Department of Strategic Studies, General Sir John Kotelawala Defence University, Ratmalana, Sri Lanka e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_15

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become one of the busiest oceanic front of seaborne traffic in the world and this inevitably leads Sri Lanka to attract interests of the major powers in the region and the world. Since the end of the Cold War, the United States dominated the economic and security systems of the world as the only superpower. However, now with the amazing economic development and wealth accumulated, China is gradually becoming a global superpower, not only challenging global superpower United States but many regional powers. The liberal world order, which came into being at the end of World War II under American leadership, has been going through a radical transformation in recent years mostly owing to China’s spectacular rise. In parallel to its increasing material power capability, China is also posing fundamental challenges to the normative fabric of the liberal world order (O˘guzlu, 2019). At present, “China’s economic and political ascent signals an epochal change. The country’s enormous growth rate has continued over almost four decades. Measured in GDP (PPP), China overtook the U.S. in 2013 as the biggest economy and now commands over 17% of the world economy” (Mayer, 2018, p. 1). As Zhang (2018, p. 43) identifies, the Belt and Road Initiative (BRI) by China to was initiated to address, “the context of profound changes in the global economic situation, growing complexity of the international order, and under the precondition of coordinating the domestic picture and the international picture”. According to Graver (2018, p. 34), in human history many states has had ambitious goals to apply transportation technologies to spread their sphere of influence and he points outs that, “Today the People’s Republic of China (PRC) is following the path of earlier rising powers by mobilizing state resources via its One Belt, One Road (OBOR) initiative to build transport links to achieve its strategic goals”. The rise of China and its growing sphere of influence is viewed with suspicion by the United State as the global superpower and some major powers such as India and Japan due to obvious geopolitical reasons. As Sen (2016, p. 10) highlights, “China see itself becoming the greatest power in all dimensions in the world as it assumes that it was throughout history”. The fear of China is going to take over the global hegemonic role from the United States and suspicion on Belt and Road Initiative (BRI) as the major tool to widen its sphere of influence has created a geopolitical paradox among many of the countries in the world. China in 2013, officially announced the BRI as one of the largest ever infrastructure development projects in human history. As part of the BRI, there are many largescale infrastructure development projects in the form of port development, railways, expressways, power plants and many more that are implemented in Asia, Africa and some parts of Europe. Highlighting ambitious nature, geographical coverage both in terms of population and land area covered, the importance of BRI in the twenty-first century can be recognized as: The BRI focuses on using the “belt” to link China to Europe through Central Asia and Russia; to the Middle East through Central Asia; and to Southeast Asia, South Asia and the Indian Ocean. The “road,” meanwhile, aims to connect China with Europe through the South China Sea and the Indian Ocean; and with the South Pacific through the South China Sea. Covering 65 countries and reaching more than 60 percent of the global population,

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accounting for nearly a third of global GDP and global merchandise trade, and 75 percent of its known energy reserves, the BRI is the most ambitious example of global economic statecraft in the twenty-first century. (Alon et al., 2018, p. 2)

China has further created financial institutions such as the Asia Infrastructure Investment Bank (AIIB) and the New Development Bank (NDB) to provide financial assistance to countries that participate in the BRI. The BRI can essentially be identified as a new global architecture that is designed by China to formulate its new role as a rising world superpower. It involves massive projects with the funding and construction of various infrastructure systems. Under BRI, there are “roads, railways, oil and natural gas pipelines, fibreoptic and communication systems, ports, and airports. But the BRI is far more comprehensive since it covers cooperation in all aspects, from policy dialog to trade, from financial cooperation to people-to-people exchange” (Alon et al., 2018). Even prior to the official announcement of the BRI by Chinese president Xi Jing Ping in 2013, China has started many infrastructure developments projects in Sri Lanka. There was clear growth in the Chinese influence in Sri Lanka since the end of civil war in the country in 2009. The investments under BRI in Sri Lanka provided much-needed foreign investments and economic development to the country as opportunities, but in contrast, the debt associated with the projects, sustainability and attracting suspicion from global superpower United States and regional power India clearly has created challenges to Sri Lanka. The Indo-Pacific Strategy (IPS) is a series of geopolitical and geo-economic initiatives undertaken particularly by the United States in collaboration with India, Japan and Australia to counter the growing Chinese influence in the region. As Chen (2018) highlights, the changes in the geopolitical environment in the Asia–Pacific region are the fundamental causes motivating the creation of the Indo-Pacific strategy. Against the backdrop of the relative weakening of the United States dominant position and the increasing shift of geopolitical and economic gravity to the Indo-Pacific, the aim is to reshape alliances and partnerships to respond to China’s rise. In recent times most of the countries ranging from India to the United States located in the Indian and Pacific Ocean theatres largely started naming the region as Indo-pacific rather than Asia–Pacific. As the current global hegemon, the United States is the main promoter of IPS to maintain its geopolitical interests. The United States Department of Defence in its annual report titled Indo-Pacific Strategy Report 2019, forwarded its strategic interests highlighting the importance of preparedness, partnership and promoting a network in the region. The report mentions that largely the actions of China along with Russia and North Korea are threatening the freedom and stability in the region. Further, various non-state transnational networks are challenging the political stability in the region. In this background, the United States as the most powerful country in the world and considering its historic links to IndoPacific region took the leadership in implementation of IPS to alter the geopolitical setting of the region to its interest (US Department of Defence, 2019). Due to the strategic importance of Sri Lanka, the United States and other powers that wants to contain the growing Chinse influence have come forward with its own

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strategy to influence the island. Both, BRI and IPS provide much-needed opportunities for the economic development of Sri Lanka. In contrast, the power rivalry and geopolitical motives behind these projects forward various challenges to Sri Lanka in the twenty-first century.

BRI and Sri Lanka Traditionally, China and Sri Lanka have maintained close and friendly relations with each other for many decades. The Chinese military, economic and diplomatic assistance during the last stages of the civil war brought China–Sri Lanka relations to a whole new level. During President Mahinda Rajapaksa’s rule from 2005 to 2015 in Sri Lanka, China became a major partner of economic development. President Rajapaksa encouraged large-scale infrastructure development projects under the Chinese assistance. The assistance provided on building expressways and power plants contributed to the much-needed economic growth to come out of a conflictaffected socio-economic background in Sri Lanka. As Karl (2018) identifies, China does not have strong maritime links to Sri Lanka as India does, but as present-day China seeks for new foreign markets and resource for its economy, it has shown greater interest on Sri Lanka that has grown economically over the last decade in relevant to the island’s strategic location in IOR, astride shipping routes that carry more than two-thirds of the global oil shipments and more than half of the all container traffic; The Sri Lanka’s centrality in the IOR, “also means that it will be a vital node in the MSRI, which is President Xi Jinping’s signature initiative for the enhancement of maritime trade and transportation networks connecting China’s coastal areas to other parts of the world” (Karl, 2018, p. 138). Even before the official announcement of the BRI, Sri Lanka had keenly embraced this connectivity plan, as it aligns well with the countries’ own economic growth aspirations. The main projects assisted by BRI in Sri Lanka are the maritime port development projects. The port development projects are implemented through the Maritime Silk Route Initiative (MSRI), the maritime segment of the BRI. During the time of president Rajapaksa, China started assisting two strategically important projects under the MSRI in Sri Lanka. The southern region of Hambantota came to limelight with the strategically important projects of a deep-water seaport and nearby International airport. In colombo, the large-scale project implemented under MSRI is the Colombo Port City Project (CPCP), which is located right next to the Colombo port and is the largest ever Foreign Direct Investment (FDI) received by Sri Lanka. The CPCP initially received an investment of USD 1.9 billion and the second phase of the project will receive investment worth USD 13 billion (Samaranayaka, 2015). According to the Sri Lanka Ports Authority (2018), the Port of Hambantota has incurred a cost of USD 1.5 billion to construct phrase I and II of the project. The end of civil war in 2009 was a promising opportunity to interact with Chinese funding for development due to stable political situation in the country and as Pant (2010) mentions, the Chinese influence in Sri Lanka has increased so much to a level in the year 2009 that there

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is no major infrastructure project in the island where the Chinese have not invested. The estimates indicated that China was Sri Lanka’s largest source of the foreign funder in 2009, providing a large USD 1.2 billion, which is nearly triple the USD 424 million that was given by the second-biggest overseas lender, the Asian Development Bank (ADB). In this background, China became the number one foreign development assistant partner of post-war Sri Lanka and laid the foundation to make island nation a strategically important stakeholder in the massive BRI project. President Xi of China himself came to Sri Lanka in 2014 for the foundation stone laying ceremony of the mega CPCP that was to be financed under BRI and to be constructed by the Chinese entities. The complex is built on reclaimed land by sea sand right next to the strategically important Colombo port. The size of the CPCP is approximately the size of Monaco. The project will host various commercial offices, luxury hotels, apartment buildings, large shopping malls, a marina, a golf course, and further a formula one race track. The development plan of the project quickly attracted attention as it gave a promising picture to Sri Lanka’s economic development. As this project represents Sri Lanka’s largest-ever foreign investment, it is an impetus for the economic growth of Sri Lanka (Crabtree, 2014). The CPCP provides an opportunity for the island’s capital to rival Asia’s economic hubs such as Dubai and Singapore. Due to its strategic location and the end of civil war in 2009 meant that Sri Lanka is destined to become the regional economic hub in South Asia. In this background, the CPCP provided the much-needed start for modernizing the countries capital to attract more foreign investments. Apart from building a new port city in the reclaimed land next to Colombo port, the BRI became a major partner in the development of Colombo port itself. As Palit (2019) mentions, The Colombo International Container Terminal (CICT), a joint venture between China Merchant Holding International and the Sri Lanka Port Authority (SLPA), in a 85:15 proportion of equity sharing has been a remarkable success. These projects in and around the Port of Colombo has contributed immensely to the capital of Sri Lanka to become an economic hub in South Asia. There are various plans by the government of Sri Lanka to develop the Colombo port in conjunction with the CPCP by connecting it to rest of the city and other parts of the country via well-developed road links. Most of this new infrastructure connected to Colombo port has gained Chinese financial and technical assistance via the BRI. Apart from infrastructure projects, Colombo is getting many luxuries hotels and high-rise commercial building as investments from Chinese enterprises. At present, there is a clear increase in the number of Chinese nationals working in different capacities in Colombo. In this background, it can be argued that China and its BRI was instrumental in the growth of the city of Colombo, the commercial hub of Sri Lanka and thereby contributed to the economic growth of the country. The second major project listed under BRI is the Hambantota port development Project in southern Sri Lanka. The construction of the Hambantota port was started due to its proximity to the international shipping route that goes near Sri Lanka. As Jayamaha (2017) highlights, the Hambantota port was built with a loan from China has not been largely a financially viable project since it started operations in 2011. The former government under president Rajapaksa sought financial assistance primarily

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from China to make a new container port in Hambantota. As per the new government which came into power in 2015, the port’s annual loan repayment commitment was stood at USD 59 million other than the loss of USD 304 million by the end of the year 2016. In this background,in July 2017, the Government of Sri Lanka (GoSL) and the China Merchants Port Holdings Ltd (a global port operator from China) signed an agreement on Public–Private Partnership (PPP) to develop the Port of Hambantota under a framework of 99-year lease, with the CMPH holding 70% stake and GoSL holding 30% stake. Under the agreement, CMPH paid GoSL a USD 1.12 billion and this PPP is currently formulating a strategy to improve the operations to gain profit. As Stacey (2017) highlights though, CPCP was a Foreign Direct Investment(FDI) by China, both Hambantota port and linked projects like adjacent airport were largely built with loan facilities provided by financial firms in China. Due to the repayment difficulty of loans by the government of Sri Lanka, it offered 70% of the shares and management of Hambantota port to China for a 99-year lease. This has raised some concerns in India, which was later negotiating a deal to buy the management of the nearby Hambantota airport. The Hambantota port is in a sparsely inhabited region in Sri Lanka. This is a largescale port that is been built under the BRI. However, making this port a profit-making sustainable project remains a serious challenge to the Sri Lankan government. Apart from the port, there are many other infrastructure projects related to this initiative. An airport, local road network, international conference facility and many infrastructure facilities are part of a greater Hambantota development project. Currently, the GoSL is extending the Sothern expressway to Hambantota to improve the connectivity with Colombo. As Razak (2019) mentions, The GoSL has identified a growth in FDI and exports as critical factors in its development plan called “Vision 2025”. In fulfilment of this initiative, a Special Economic Zone (SEZ) is implemented in Hambantota with the fullest assistance of the Chinese government.

Geopolitical Implications Related to BRI As mentioned above many in the strategic communities in the United States and India has incurred a fear that implementation of BRI is challenging their traditional sphere of influence. From a geopolitical perspective, the project brought strategic concerns from India since it is located right next to South Asia’s busiest transshipment hub, the Port of Colombo. Historically India has largely dependent on the Port of Colombo for its transhipments. “Sri Lanka’s Colombo port which essentially thrives on the Indian subcontinent trans-shipment trade captured 42% of Indian freight in FY 2017–18” (Indian Container Market Report, 2018, p. 23). Apart from the importance in transshipment, Sri Lanka is vital for India’s security interests due to its strategic location in its southern tip. The arrival of Chinese President himself to commence the work in the CPCP and parallel arrival of Chinese naval ships and submarines alarmed the strategic community in New Delhi in 2014. As Hariharan (2014) mentions, India expressed serious concern to its national security to then Sri

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Lanka’s Defence Secretary Gotabaya Rajapaksa via a meeting among, then India’s Defence Minister Arun Jaitley and the National Security Advisor Ajit Doval in New Delhi on 20 October 2014, over the incident of docking of the Chinese submarine and a naval ship. Subsequently, it was clear there was a diplomatic unease between the then Indian government and Rajapaksa government in Sri Lanka due to the growing Chinese influence in Sri Lanka. The United States and Indian displeasure over the growing Chinese influence on a greater extent had an impact on the local politics in Sri Lanka. In 2015, there was a government change in Sri Lanka which brought a coalition government under the leadership of President Maithripala Sirisena and Prime Minister Ranil Wickremasinghe. The new government immediately holed the CPCP and engaged in a diplomatic effort to normalize the relations with India and the United States. But with time, the new government soon recognizing the importance of China’s economic capabilities and with the difficulties it faced in repaying the debt to China coupled with relatively less assistance from India and West on economic investments, it had to come to a compromise regarding the various projects implemented under BRI. After negotiations on the environmental issues, legality and control of the entity and various other aspects, the project was renamed as the Colombo International Financial City (CIFC) in 2016 and the project is to progress till 2041. The geopolitical concerns of the United States and India regarding growing Chinese influence are related to the ‘String of Pearls Strategy’ that was brought forward initially by some defence analysts in the United States. The concept of String of Pearls which came to limelight of IOR politics in 2005 came with a report published by the Department of Defence in the United States. The concept was used to explain the network of port development projects by China and its relationships across Sea Lines of Communications (SLOCs), which stretches from the Chinese mainland to the Port Sudan in Africa. The sea lanes connect via several strategically important maritime chokepoints along the Strait of Malacca, the Strait of Mandeb, the Lombok Strait, the Strait of Hormuz, and other strategically important maritime centres in South Asia connecting Myanmar, Bangladesh, Sri Lanka, the Maldives and Pakistan (The Washington Times, 2005). In this background, Both United States and India worry that Hambantota can be a future Chinese military base to contain India geopolitically in the region of South Asia and challenge the United States naval dominance in the IOR. In relation to recent Chinese acquisitions in Hambantota, Malcolm Davis, a senior analyst at the Australian Strategic Policy Institute mentiones that, “This is part of a determined strategy by China to extend its influence across the Indian Ocean at the expense of India and it’s using Sri Lanka to achieve it” (as cited in Tarabay, 2018). This geopolitical scenario has attracted the United States and Indian geopolitical counterbalance initiatives towards Sri Lanka.

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IPS and Sri Lanka As Dhowan (2018) identifies, “The Indo-Pacific is a functional region, in which we encounter a heady mix of maritime connectivity, collaboration, cooperation and competition” (p. 55). Sri Lanka’s location means that it is in an unavoidable situation where it must face the challenges and opportunities forwarded by the IPS. As mentioned above United States along with India, Japan and Australia have become the major proponents of IPS in the region. From a Sri Lankan perspective, it’s important to understand and analyse what IPS exactly stands for and in contrast how it could balance the relations with BRI. The United States is Sri Lanka’s major export destination for many years and represents nearly a quarter of Sri Lanka’s exports. In recent times, the United States has increased its economic and military assistance to Sri Lanka. The United States and Sri Lanka have agreed on a USD 480 million Millennium Challenge Corporation (MCC) fund supporting Sri Lanka’s economic development. Largely praposed MCC is targeted on the road development in Sri Lanka. The United States also provided USD 39 million in foreign military financing to enhance Sri Lanka’s maritime domain awareness (US Department of State, 2019). In recent times, the United States has increased its cooperation with Sri Lankan security force and in particular with the Sri Lankan navy. On 29 August 2019, the United States government provided Sri Lanka with a naval ship to improve the maritime cooperation among the two countries. As the US Embassy in Colombo (2018) highlights, the ship named cutter is a gift from the United States, and now is the largest ship in the Sri Lankan naval fleet and will strengthen defence cooperation between the two countries. The ship will contribute to patrol Sri Lanka’s Exclusive Economic Zone (EEZ) by providing additional security for the ships from all nations that navigate via sea lanes of the IOR. As Ramachndran (2019) mentions, two defence cooperation agreements are in the limelight between the United States and Sri Lanka, the first being already signed Acquisition and Cross-Servicing Agreement (ACSA) and second being an agreement under-negotiation named Status of Forces Agreement (SOFA), that is triggering concern, criticism, and controversy in Sri Lanka. The SOFA agreement allows United States military personnel and other technical staff to arrive in Sri Lanka at a time of an emergency with minimal visa restrictions. This has started a debate among the Sri Lankan policymakers and strategic community on how to formalize relations with the United States to gain opportunities while maintaining the sovereignty of the country. In Sri Lankan geopolitical perspective, India has been the most important factor in its foreign policy due to proximity, size and its ability to influence Sri Lanka. India has become a major partner to IPS via various collaborations with partners and its own initiatives. Since the end of the Cold War, India has developed its economic and security relations rapidly with the United States and is facilitating the IPS to counter Chinese influence in the region. In recent times, India’s Act East Policy, Sagar Mala, being part of QUAD, Malabar exercises and many development initiatives in the Indo-pacific region highlights its commitment to IPS.

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As mentioned above India at different levels has informed its dissatisfaction to GoSL about the growing Chinese influence in Sri Lanka under the BRI projects. India funded the reconstruction of the railways in northern Sri Lanka after the end of the civil war in 2009 which was destroyed due to the conflict. India further is involved in port and other infrastructure development in northern Sri Lanka. The Indian government sources (Indian High Commission in Colombo, 2019) mentions, that India is constructing 50,000 houses as a part of post-conflict rehabilitation efforts in the country. This project is implemented as full grant assistance valued at USD 270 million and is one of the largest grant assistance projects by India in overseas. Recently, India has further agreed to build 10,000 houses for the state workers in Sri Lanka. India also has shown a greater interest in the Hambantota. There was discussion among the Indian and Sri Lankan authorities on Indian interest to acquire the management of Mattala International Airport in the vicinity of Hambantota sea port. As Samaranayake (2014) mentions, India now is using Hambantota as a transhipment hub to export its goods to various parts of the world: Interestingly, despite the controversy over Beijing’s support of Hambantota and the strategic implications for New Delhi, India is getting some commercial benefits from the use of this port Hambantota is now occupied with trans shipping automobiles from India that are meant for East African markets, and also South America and Eastern Europe. (p. 66)

Apart from India, Japan has also shown its interests to cooperate with Sri Lanka under the framework of IPS. Japan has traditionally been a major funder for economic development in Sri Lanka. As Dardenne (2018) mentions, traditionally Japan has been one of Sri Lanka’s biggest bilateral donors and thus is considered as one of its main partners in economic development. In the view of Sri Lanka’s strategic location, the island is courted by China and other powers preoccupied with security in the IOR. Japan has looked at Sri Lanka as a valuable partner. In recent times Japan’s government has courted Sri Lanka as an important geopolitical partner. In April 2017, Japan has officially announced its decision to invest largely in Sri Lanka’s port infrastructure and has pledged to provide 1 billion yen (USD 9.46 million) to improve the strategically important of Trincomalee port in the eastern part of the island. In 2019, the major development related to IPS in Sri Lanka has come from the India-Japan collaborative project to invest in the strategically important Colombo port. Indian and Japanese governments signed a Memorandum of Cooperation (MoC) with the government of Sri Lanka to operate and develop one of the newly built East Container Terminal (ECT) in the Port of Colombo. The terminal will be operated, and the profit will be shared on the basis that Sri Lanka will control 51% of the project and India and Japan jointly controlling the other 49% (Herskovitz & Marlow, 2019; Srinivasan, 2018). This initiative is intended to bring a counterbalance against the growing Chinese influence under BRI in and around Colombo port. But there is serious opposition to this deal by many segments in the country. The Chinese investment at Port of Colombo was to built-operate-transfer (BOT) and the proposed new venture in the ECT will allow India and Japan to jointly operate an already built highly profitable venture. However, Since India particularly and Japan uses the Port

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of Colombo for their own transhipments intensively, Sri Lanka must also recognise and collaborate with India and Japan to improve the operations and profitability of the Port of Colombo. In this background, Sri Lanka needs to analyse projects under BRI and IPS from all viewpoints to gain opportunities and face the challenges.

Conclusion BRI is the large infrastructure development initiative that covers many parts of the world operated by China in the twenty-first century. The IPS is forwarded by United States, India, Japan and Australia to largely counter the growing influence of BRI in the Indo-Pacific Region. Due to its strategic location, Sri Lanka has become an important partner in both of these initiatives. China has invested heavily in terms of both funds and loans in various projects under BRI. The development initiatives related to maritime infrastructure around the Port of Colombo and Hambantota have become strategically important projects under BRI in Sri Lanka. The growing Chinese influence in Sri Lanka within the framework of BRI is viewed with suspicion particularly by the United States and India largely due to obvious geopolitical reasons. In this background, implementing countries of IPS has come up with their own strategically important initiatives to maintain their interests in Sri Lanka. Their interests in maritime infrastructure under IPS can be viewed as strategic initiatives to balance Chinese initiatives under BRI. In this background, balancing the geopolitical interests of the powerful countries remains a major challenge to Sri Lanka in the twenty-first century. Since Sri Lanka is still a developing country, it should have an effective strategy to gain opportunities while successfully facing challenges provided by both BRI and IPS.

References Alon, I., Zhang, W., & Lattemann, C. (2018). Introduction. In I. Alon, W. Zhang, & C. Lattemann (Eds.), China’s Belt & Road Initiative: Changing the rules of globalization (pp. 1–13). Palgrave Macmillan. Chen, D. (2018). The Indo-Pacific strategy: A background analysis. https://www.ispionline.it/it/pub blicazione/indo-pacific-strategy-background-analysis-20714 China Builds Up Strategic Sea Lanes. (2005, January 17). The Washington Times. https://www.was hingtontimes.com/news/2005/jan/17/20050117-115550-1929r/ Crabtree, J. (2014, September 17). Sri Lanka sees benefits of China’s ‘Maritime Silk Road Plan’. Financial Times. https://www.ft.com/content/8645737e-3e2d-11e4-b7fc-00144feabdc0 Dardenne, A. (2018). Japan’s Indo-Pacific strategy: The importance of Sri Lanka. https://theasiadi alogue.com/2018/05/01/japans-indo-pacific-strategy-the-importance-of-sri-lanka/ Dhowan, R. K. (2018). Opportunities and challenges in the Indo-Pacific region and Structureto Enhance Maritime Cooperation and partnership in the region. In Proceedings of the Galle Dialogue 2018 International Maritime Conference, Colombo, Sri Lanka.

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Drewry. (2018). Indian Container Market Report. http://containersindia.in/pdf/INDIAN%20CONT AINER%20MARKET%20REPORT-2018.pdf Garver, J. W. (2018). China’s rise and the Eurasian transportation revolution. In J. F. Blanchard (Ed.), China’s Maritime Silk Road initiative and South Asia: A political economic analysis of its purposes, perils, and promise (pp. 33–52). Palgrave Macmillan. Hariharan, R. (2014, November 12). Security concerns over Chinese submarines visit to Colombo. Colombo Telegraph. https://www.colombotelegraph.com/index.php/security-concerns-over-chi nese-submarines-visit-to-colombo/ Herskovitz, J., & Iain Marlowhttps, I. (2019). China faces new competition as Japan, India Eye Sri Lanka Port. www.bloomberg.com/news/articles/2019-05-21/japan-india-in-deal-at-belt-androad-colombo$port-nikkei High Commission of India Colombo. (2019). Indian Housing Project. https://hcicolombo.gov.in/ indian_housing Jayamaha, R. (2017). Potential economic benefits of Belt and Road Initiative (BRI) and opportunities for Sri Lanka. Paper presented at the China in South Asia—South Asia in China: OBOR and the Sri Lankan ExperienceInternational Conference 2017: Regional Centre for Strategic Studies (RCSS), Colombo, Sri Lanka. Karl, D. J. (2018). Sri Lanka, the Maritime Silk Road, and Sino-Indian relations. In J. F. Blanchard (Ed.), China’s Maritime Silk Road Initiative and South Asia: A political economic analysis of its purposes, perils, and promise (pp. 137–172). Palgrave Macmillan. Mayer, M. (2018). China’s rise as Eurasian power: The revival of the Silk Road and its consequences. In M. Mayer (Ed.), China’s Belt and Road Initiative and Emerging Eurasian relations (pp. 1–42). Palgrave Macmillan. O˘guzlu, T. (2019). Understanding China’s challenge to the international order. https://www.dailys abah.com/op-ed/2019/07/23/understanding-chinas-challenge-to-the-international-order Palit, A. (2019). Colombo Port, China and India. http://www.asiansun.lk/colombo-port-china-andindia/ Pant, H. V. (2010). The New Battle for Sri Lanka. http://www.isn.ethz.ch/Digital-Library/Articles/ Detail/?lang=en&id=117624 Port Strategy. (2019). Japan, India and Sri Lanka to Develop Colombo. https://www.portstrategy. com/news101/world/asia/japan,-india-and-sri-lanka-to-develop-colombo Ramachandran, S. (2019). Sri Lankans Up in Arms Over US Military Pacts: A proposed Status of Forces Agreement with the US is stirring up political controversy in Sri Lanka. https://thedip lomat.com/2019/08/sri-lankans-up-in-arms-over-us-military-pacts/ Razak, A. (2019, June 10). Master Plan for Hambantota in the works. Sunday Observer. http:// www.sundayobserver.lk/2018/06/10/news-features/master-plan-hambantota-works Samaranayaka, D. N. R. (2015, March 17). The economics of The Colombo Port City Project. Colombo Telegraph. https://www.colombotelegraph.com/index.php/the-economics-ofthe-colombo-port-city-project/ Samaranayake, N. (2014). Island States in a Region of Great Powers. In D. Michel & R. Passarelli (Eds.), Sea change: Evolving Maritime geopolitics in the Indo-Pacific region (pp. 61–70). Stimpson. Sen, G. (2016). China-one belt and one road initiative:Strategic & economic implications. Vivekananda International Foundation. Sri Lanka Port Authority. (2018). Development of Port in Hambantota. http://portcom.slpa.lk/port_h ambantota.asp?chk=4 Srinivasan, M. (2018, May 28). Sri Lanka, Japan, India sign deal to develop East Container Terminal at Colombo Port. The Hindu. https://www.thehindu.com/news/international/sri-lankajapan-india-sign-deal-to-develop-east-container-terminal-at-colombo-port/article27273794.ece Stacey, K. (2017, December 11). China signs 99-year lease on Sri Lanka’s Hambantota port: Critics denounce move as an erosion of country’s sovereignty. The Financial Times. https://www.ft.com/ content/e150ef0c-de37-11e7-a8a4-0a1e63a52f9c

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Tarabay, J. (2018). With Sri Lankan port acquisition, China adds another ‘pearl’ to its ‘string’. https://edition.cnn.com/2018/02/03/asia/china-sri-lanka-string-of-pearls-intl/index.html U.S. Department of State. (2019). Indo-Pacific strategy report: Preparedness, partnerships, and promoting a networked region. https://media.defense.gov/2019/Jul/01/2002152311/-1/-1/1/DEP ARTMENT-OF-DEFENSE-INDO-PACIFIC-STRATEGY-REPORT-2019.PDF U.S. Department of State. (2019). U.S. relations with Sri Lanka. https://www.state.gov/u-s-relati ons-with-sri-lanka/ U.S. Embassy Colombo. (2018). U.S. hands over high endurance cutter to Sri Lankan Navy [Press Release]. https://lk.usembassy.gov/u-s-hands-over-high-endurance-cutter-to-sri-lankan-navy/ Zhang, H. (2018). The 21st century Maritime Silk Road and the leading function of the shipping industry. In M. Mayer (Ed.), China’s belt and road initiative and emerging Eurasian relations (pp. 43–56). Palgrave Macmillan.

Asantha Senevirathna is a Senior Lecturer attached to the Department of Strategic Studies at the General Sir John Kotelawala Defence University, Ratmalana, Sri Lanka. He holds a B.A. (Hons.) in Geography from the University of Peradeniya, Sri Lanka and M.A. in International Relations from the University of Colombo, Sri Lanka. His most recent publication is titled ‘China’s 21st Century Maritime Silk Road and its Influence on the Development of South Asia: A Geopolitical Perspective’ published as a book chapter by Shanghai University in collaboration with Routledge.

Chapter 16

Go South Towards the Indo-Pacific: Taiwan, Korea and Japan’s Policy Response Against the BRI Tony Tai-Ting Liu

Abstract Since the introduction of the Belt and Road Initiative (BRI) by China in 2013, international order seems to be steadily moving towards an order of Western decline and Chinese dominance. In Asia, while countries become ever dependent on trade with China, in many cases, trade has not bolstered bilateral relations but has led to disruptive events that demonstrate China’s economic leverage over neighboring countries. Regional support for the BRI remains shallow, with countries such as the United States, India, Japan and South Korea maintaining cautious and suspicious attitudes towards the initiative. Noting the context, this article observes the policy response of Taiwan, South Korea and Japan—countries that share both political tensions and close economic relations with China—towards the BRI, and argues that the three countries converge on their foreign policy strategy. The three countries all strengthen relations with Southeast and South Asia, complement the US IndoPacific Strategy, and keep China at arm’s length. This article will examine the development of the “Southern” or southward policies of Taiwan, South Korea and Japan, the reception of the policies in the targeted region and their potential challenges. This author notes a number of challenges that undermine the southern/southward strategy as an effective rebalancing act towards the BRI.

Introduction Confronted with the rise of China over the past two decades, in East Asia, many countries looked towards China as their greatest challenge and opportunity in the near future. The description is particularly true following the United States’ economic decline in 2008 and the election of Donald Trump as US president in 2016. While countries such as Taiwan, South Korea and Japan continue to depend on Washington for security in the region, economically, China has replaced the US as the dominant partner in the mentioned countries. While China provides immense opportunities for trade, its assertiveness in territorial disputes keeps neighboring countries on guard. T. T.-T. Liu (B) Graduate Institute of International Politics, National Chung Hsing University, Taichung, Taiwan e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_16

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In such context, besides efforts to adopt seikei bunri strategies, or the separation of economic and political goals and policies, Taiwan, South Korea and Japan have all turned their attention to South and Southeast Asia as part of their solution for diversifying trade and creating distance with China. The endeavors of Taiwan, South Korea and Japan have translated into respective “southern” or “southbound” policies in recent years, a noticeable regional development that came about after China initiated the Belt and Road Initiative (BRI) in 2013. Through the Silk Road Economic Belt and the Twenty-first Century Maritime Silk Road—the belt and road—China seeks to establish an integrated market that benefits all countries that sit alongside the two routes through increased trade. Despite some success and progress over the past eight years, the BRI has also attracted suspicion and criticism from observers who question Beijing’s intention and the so-called “debttrap diplomacy”, which played out most vividly in Sri Lanka. Noting the context, this chapter observes Taiwan, South Korea and Japan’s respective southward policy and argues that strengthening relations with South and Southeast Asia, complementing the US Indo-Pacific Strategy (IPS), and keeping China at arm’s length is a common strategy for the three countries. Correspondingly, a number of structural challenges undermine the policies as effective balancing acts against the BRI.

China Rising and the Belt and Road Initiative Since the initiation of economic reforms and opening up of the Chinese market by former leader Deng Xiaoping more than four decades ago, China recorded staggering economic growth, to the extent that the rise of China is noted by many observers as one of the greatest phenomena in international relations in recent memory besides the ending of the Cold War (Jacques, 2012). At the turn of the century two decades ago, China’s increased economic might translated into an overall elevation in global status backed up by stronger political and military power. In such context, former leaders Hu Jintao and Wen Jiabao advocated the “harmonious worldview” and “peaceful development” of China that aim at quelling the fears and suspicions of the international community. Since 2013, incumbent Chinese president Xi Jinping began advocating the “China Dream”, or an Eastern version of the “American Dream” that seeks to mobilize the Chines nation to work hard and strive for a better livelihood (Sorensen, 2015, pp. 53–73). Against the elaborated developments came the BRI, a strategy described by Suisheng Zhao as “the signature of Xi Jinping’s diplomacy” (Zhao, 2019, pp. 319– 335). Introduced in 2013, the BRI, formerly known as the One Belt One Road (OBOR), has since become the buzzword in global politics that symbolizes the culmination of China’s emergence as a great power onto the world stage. Through the construction of railways, highways and other infrastructure across the Eurasia continent, China seeks to establish an intercontinental market of unprecedented size that facilitates the flow of goods in and out of China. The Silk Road Economic Belt, as claimed by Beijing, will bring about an integrated market that would prove to be

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a win–win for China and the world. Meanwhile, the Twenty-first Century Maritime Silk Road aims to connect China with Europe via Southeast and South Asia and Africa. In addition to the massive economic potential, together, the belt and road would have a major geopolitical impact on the world by increasing the importance of the Global South. While the success of the BRI awaits assessment over time, thus far, the project has accomplished some results. Institutionally, for example, the First Belt and Road Forum (BRF) for International Cooperation was convened in Beijing in May 2017 and gathered the attendance of 29 foreign leaders and representatives from more than 130 countries (Teizzi, 2020). A second forum was held in April 2019 and witnessed the attendance of 37 foreign heads of state. The second BRF produced a Joint Communique that documents future cooperation in cultural exchange, investment projects and initiatives to battle climate change such as the “Clean Silk Road”. In conjunction with the BRI, China established the Asia Infrastructure Investment Bank (AIIB), an organ that will provide the financial resources to realize the belt and road for member countries in need. With the exclusion of the US and Japan, the AIIB is considered by some observers to be a potential rival to financial organizations primarily led by the West such as the International Monetary Fund (IMF) and the World Bank (WB) (Dahir, 2018). Noting the challenge that China’s rise has posed against the dominant international status of the US since the end of the Cold War, especially after the global financial crisis in 2008, the BRI can be seen as a direct trigger for Washington’s turn towards the Indo-Pacific under the Donald Trump administration. Centered on the Indian Ocean and the Pacific Ocean, the Indo-Pacific Strategy (IPS) directly challenges the maritime silk road while highlighting South and Southeast Asia as the main grounds for US-China confrontation. Extending from the rebalance towards Asia strategy under the previous administration, the US continues to advocate the right to freedom of navigation in the South China Sea regardless of China’s claim over the region as its sovereign water and core interest. Meanwhile, the US continues to court the support of India in the hopes of jointly checking the western expansion of China’s influence. As the following sections seek to explain, for both economic and geopolitical reasons, introduction of the BRI and the IPS has caused Taiwan, South Korea and Japan to turn their attention to South and Southeast Asia as well.

Taiwan, Korea and Japan Go South In correspondence to the introduction and promotion of the BRI since 2013, Taiwan and South Korea were the first countries to propose so called “Southbound” or “Southern” policies that seek to strengthen relations with South and Southeast Asian countries, in an effort to counterbalance heavy dependence on the Chinese economy. In contrast, Japan currently does not have a specific southbound policy, yet South and Southeast Asia figure prominently in Japanese foreign policy. In response to the BRI, Tokyo has actively sought to consolidate relations with India and Southeast Asian

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countries, a move that goes well with the US turn towards the Indo-Pacific. This section briefly reviews the southbound policy of Taiwan, South Korea and Japan respectively and notes how the policies cohere with the US IPS.

Taiwan: New Southbound Policy In stark contrast with the previous Kuomintang (KMT aka Nationalist) government, in 2016, following party overturn, President Tsai Ing-wen and the Democratic Progressive Party (DPP) government adopted the New Southbound Policy that seeks to move Taiwan’s foreign policy emphasis away from China. Under former president Ma Ying-jeou and KMT leadership from 2008 to 2016, economic cooperation and cultural exchange between Taiwan and China greatly expanded, to the extent that concerns for China to exploit its economic influences as political leverage over Taiwan heightened as well. The New Southbound Policy picked up where the “old” southbound policy left off under the Lee Teng-hui administration two decades ago and encourages Taiwanese business to direct their production lines and investments to India and Southeast Asian countries (Jing, 2018, p. 2). In June 2016, within weeks after the inauguration of the DPP government, Taiwan established the New Southbound Policy Office under the Presidential Office, responsible for overseeing the policy turn towards South and Southeast Asia. In addition to the emphasis on commercial relations, the New Southbound Policy further stresses the importance of people-to-people relations, which translates into the promotion of cultural exchange between Taiwan and target countries to its south. Such cultural emphasis coincidentally echoes the increased flow of migrant workers and spouses from Southeast Asia that has been slowly changing the island’s demographic makeup over the past two decades. In 2018, the New Southbound Policy Office was terminated; its duties were transferred over to the special task force on New Southbound Policy under the National Security Council and the working group on New Southbound Policy under the Office of Trade Negotiation. In light of the BRI and Taiwan’s isolated international status due to the One China principle, adoption of the New Southbound Policy can be seen as a pragmatic move by Taipei to expand its international relations while circumventing political sensitivities related to China. Due to opposition and suppression by Beijing, Taiwan has largely remained outside the economic integration movement in the Asia Pacific since the 1990s and faces the imminent challenge of marginalization from the region once integration is realized (Liu, 2015, pp. 25–39). By turning towards South and Southeast Asia countries that constitute the Association of Southeast Asian Nations (ASEAN)—one of the leading drivers of regional integration—Taiwan seeks to strengthen its economic relations with neighbouring countries and hopefully participate in regional integration initiatives to avoid marginalization. Strategically, by strengthening relations with India and ASEAN countries, Taiwan hopes its efforts can develop into an active balance of power strategy that effectively keeps China in check. Overall, noting strong relations between Taiwan and the US, with a similar

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geographic focus, the New Southbound Policy adds to the US IPS by providing Washington with an additional regional partner it can work with to counter China’s influence.

South Korea: New Southern Policy In November 2017, on his visit to Indonesia, President Moon Jae-In announced the New Southern Policy. The New Southern Policy is a component of the “Northeast Asia Plus Community for Responsibility Sharing” that sets out the foreign policy priorities of the government. The New Southern Policy emphasizes 3Ps— people, prosperity and peace—which bears semblance with Taiwan’s New Southbound Policy (Lee, 2019, p. 3). As such, it is clear that the Moon government’s policy innovation is about both economic and cultural exchange with its southern neighbours. While excessive dependence on the Chinese economy is a driving force for the initiation of the New Southern Policy, it is important to note that installation of the Terminal High Altitude Area Defense (THAAD) system on the Korean peninsula generated political rifts between South Korea and China that serve as an additional driver for the New Southern Policy. After the previous Park Geun-Hye government decided to install THAAD in 2016, China’s massive boycott on Korean exports severely damaged the Korean economy and prompted Seoul to reconsider its relationship with China. The wrath of Beijing in a sense encouraged South Korea to search for alternatives. Demonstrating commitment to the southern turn, since entry into office, President Moon has made official visits to India and all the ASEAN countries. Under the Presidential Office, in 2018, the Moon government established the New Southern Economic Committee, a special committee on the southbound policy that consists of officials from eleven ministries. In November 2019, after meeting with ASEAN representatives in Busan, President Moon announced plans to push for a 2.0 version of the New Southern Policy (Lee, 2019). The same occasion also witnessed the adoption of a Joint Vision Statement for Peace, Prosperity and Partnership between Korea and ASEAN. Concerning the BRI, Seoul remains ambivalent. While the Moon Jae-In government has expressed an interest to join the BRI and saw the possibility of the initiative to prompt the connection of railways across the 38th parallel on the Korean Peninsula, the experience of THAAD suggests otherwise. Although the Eurasia Initiative, a proposal introduced by the previous Park Geun-Hye administration to promote Korea’s connection with the Eurasia continent in 2013, was cut short due to domestic political scandal, in a similar vein, as Balbina Hwang argues, the New Southern Policy can be considered as a reaction to the BRI challenge (Hwang, 2019, pp. 129–150). Whether Korea will continue to balance or hedge against China depends on whether both countries can get over the political fallout from THAAD.

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Japan: Indo-Pacific Strategy and Southern Policy Without going back to the “southern expansion doctrine” (nanshin-ron) advocated during the period of Imperial Japan, Japan’s official southbound policy first came about in 1977, established after Prime Minister Takeo Fukuda’s speech in the Philippines. Named after the PM, the Fukuda Doctrine advocates the rejection of the role of military power for Japan, the strengthening of mutual confidence and trust between Japan and Southeast Asian countries, and the establishment of equal partnership between Japan and ASEAN (Haddad, 1980, pp. 10–29). Compared with Taiwan and Korea, atrocities in the Great War demanded Japan to make efforts towards reconciliation before encouraging economic and cultural exchange with Southeast Asia. Chronically strained relations with China and South Korea pushed Japan towards advancing relations with South and Southeast Asia. Due to the rise of China and US rebalance to Asia, South and Southeast Asia became strategically meaningful for Japan, particularly in terms of containing the expansion of China’s influence. Under the Shinzo Abe administration, Japan’s southbound policy extended to the Indian Ocean and is part of a greater Indo-Pacific Strategy that overlaps with the US IPS under Donald Trump. In an address to the Indian parliament in August 2007 during his first term in the PM Office, Abe highlighted the “confluence of the two seas”—the Indian Ocean and the Pacific Ocean—as the basis for partnership between Japan and India (Ministry of Foreign Affairs Japan, 2020). Coinciding with the US pivot to Asia under the Barack Obama administration, in his second term in office commencing in 2012, PM Shinzo Abe supported the US position for freedom of navigation in the waters in Southeast Asia while promoting the so-called “Democratic Security Diamond,” which advocates closer cooperation among the US, Japan, India and Australia (Abe, 2012). The proposal later crystalized into the Quadrilateral Security Dialogue, or QUAD alliance that is aimed at containing the influence of China. In short, Japan’s interests highly correspond with the US IPS, with India and the Indian Ocean serving as a central piece for cooperation. While Southeast Asia is economically meaningful for Japan as well, the fact that Tokyo has little role to play in disputes in the South China Sea considerably weakens its position in the region. In terms of the BRI, India plays a key role in Japan’s response. Days after the conclusion of the second BRF, on 25 May 2017, Japan and India jointly established the Asia-Africa Growth Corridor (AAGC). Extending from the two seas proposal, the AAGC seeks to connect Asia and Africa through the establishment of new maritime shipping routes. The timing of the proposal, along with continued tensions between Japan and China (and India and China), had many observers pondering over the possibility of emerging competition between the AAGC and BRI. It remains to be observed whether the two projects are compatible, or are set for competition in the near future.

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Challenges to Going South Despite intentions to divert away from China and counterbalance the BRI by strengthening relations with India and Southeast Asian countries, three factors impinge on the success of the described Southward policies: the China factor, volatility of US foreign policy since 2016, and domestic politics in the countries concerned.

China Factor Regardless of efforts to keep China at arm’s length, geographical proximity perhaps fatefully dictates that Taiwan, South Korea and Japan cannot easily turn away from their gigantic neighbor, even with the adoption of policies precisely aimed at such goal. While bilateral trade with India and Southeast Asian countries have increased in recent years for Taiwan, Korea and Japan, China remains the biggest trade partner for the three countries. Such development might have coincidentally prompted the three countries to subsequently adopt policies faced towards South and Southeast Asia. Yet the challenge continues to be whether detaching from China economically is possible or not. The numbers suggest otherwise. For example, in terms of the tourism industry—an important source of economic revenue—for Taiwan, while official data suggests that in 2019, visitors from both China and South and Southeast Asian countries make up roughly 25% of all incoming tourists respectively, at approximately 2.4 million, there is still much room for growth, compared with almost 4.2 million Chinese tourists visiting the island in 2015 (Taiwan Tourism Bureau, 2020). For South Korea, in 2019, more than 5.5 million Chinese tourists visited the country, making up 34% of the total number of visitors to the peninsula (Korea Tourism Organization, 2020). In the case of Japan, in 2018, more than 8.3 million Chinese tourists visited Japan, contributing to 26 percent of all visitors from abroad (JTB Tourism Research & Consulting Co., 2020). By November 2019, more than 7.5 million Chinese tourists entered Japan, which accounts for about twice the number of visitors from India and the ASEAN countries combined. In short, China plays a much larger role than South and Southeast Asian countries in terms of economic contributions via tourism. While going South and turning towards the Indo-Pacific presents a viable alternative than simply going West, China’s strong presence in Southeast Asia suggests that the described southbound policies may achieve only limited success, especially if the objective is to counter the BRI. In the past decade, China has been ASEAN’s biggest trade partner while serving as a major driving force for regional integration. In 2002, China became the first Asian country to sign a free trade agreement (FTA) with ASEAN; in 2010, China and ASEAN outpaced neighboring countries to establish a free trade area, the China-ASEAN Free Trade Area (CAFTA). The CAFTA has since become an inducement for further integration in the region, whether through the ASEAN plus Three or the Regional Comprehensive Economic Partnership (RCEP).

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Korea and ASEAN established a FTA in 2006 while Japan and ASEAN concluded the Comprehensive Economic Partnership Agreement (EPA) in 2007. Noting China’s economic status in Southeast Asia, whether Korea and Japan can catch up to China through their respective southbound policy remains in doubt. Meanwhile, Taiwan has only completed an EPA with Singapore and remains aloof of the integration process due to China. Without region wide FTAs to complement, the New Southbound Policy confronts great barriers.

US Foreign Policy Shifts in US foreign policy since 2016 effectively challenge Taiwan, Korea and Japan’s respective southbound policy. For one, with President Donald Trump showing a lessened interest in Southeast Asian affairs, in contrast with developments during the Obama era, Taiwan, Korea and Japan find themselves to be without US backing while engaging in mutual competition brought forth by similar policies to strengthen relations with countries in the region. Meanwhile, Chinese influence remains strong in Southeast Asia, which suggests possibilities for potential cooperation that may not necessarily be worse in the absence of the US. On the other hand, in terms of the Trump administration’s IPS or Asia Pacific strategy, while the US sought to contain China through the QUAD and the waging of a trade war, it is also demanded South Korea and Japan to shoulder more defense responsibilities while confronting North Korea and China with a tougher stance. In the case of Taiwan, although the US did not demand Taiwan to increase its defense budget, by agreeing to support Taiwan with stronger military capabilities, Washington tickled the nerve of Beijing. In short, Washington disrupted the peace in the Indo-Pacific region, which inevitably contradicts the objective of the southbound policies. Despite proposal of the IPS, since inauguration, President Trump has yet to make a state visit to India nor attend the annual ASEAN summit meeting, which are important signs for US commitment in the region. Such abstinence stands in contrast with the previous government, which witnessed former President Obama visit India twice and meeting with ASEAN leaders on many occasions. The implication of Washington’s turn is clear. As Piti Srisangnam notes, “it shows that the US does not see ASEAN as important… the US may see its influence in the region decline” (Muramatsu, 2019). Meanwhile, although US–India relations have not been severely damaged since 2016, India remains watchful over changes in US foreign policy. For Taiwan, Korea and Japan, US actions implicate their respective southbound policy in different ways. First, in the case of Taiwan, with Washington’s reduced interest in Southeast Asia, Taipei lost a potentially strong supporter that may be able to influence the development of economic integration in Asia. Participation in regional integration is an important underlying objective of the New Southbound Policy. For South Korea, while the goal of the New Southern Policy is to reduce the country’s dependence on the Chinese economy, US confrontation with North

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Korea and its demand on Seoul to increase its defense spending by fivefold effectively encouraged the latter to seek rapprochement with Beijing. In a sense, such development prompted South Korea to reflect on the US IPS and generates room for cooperation between Seoul and Beijing, perhaps through the New Southern Policy. Lastly, for Japan, the overlapping of strategic interests reduced friction between Tokyo and Washington. Yet with the US’ decreased attention towards Southeast Asia, Japan seems forced to be more proactive in adopting independent foreign policies such as the Comprehensive and Progressive Agreement for Transpacific Partnership (CPTPP).

Domestic Politics Common wisdom dictates that the success of any policy rests on its continuation and outcome over an extended period. Hence in terms of the described southbound policies, it is still much too early to evaluate their success and failure. However, the fact that Taiwan, South Korea and Japan have all embraced democracy entails that the sitting government needs to undergo an evaluation by its people every few years. As such, the future of the mentioned southbound policies is decided as much by great powers as by domestic politics. Juxtaposed with Taiwan’s lean towards China under the KMT from 2008 to 2016, the New Southbound Policy marks an achievement by the DPP government to mitigate the island’s excessive dependence on the Mainland and search for alternatives. Nonetheless, the fact that China remains inalienable to Taiwan’s foreign policy means that success of the New Southbound Policy will be inevitably judged against the development of China–Taiwan relations. Under the DPP government, Taiwan’s relationship with China reached a trough, with Beijing severing communication with Taipei and increasing its diplomatic pressure against the island. The re-election of Tsai Ing-wen as president in 2020, however, suggests that the New Southbound Policy may continue to be implemented for at least another four years. While critics remain reserved and doubt the success of the New Southbound Policy, it is undeniable that the policy has achieved some success in increasing cultural and tourist exchange between Taiwan and India and Southeast Asia. In Korea, despite the intention to diversify Korea’s overseas trade, one may find it difficult to consider the New Southern Policy as a wide success under the Moon JaeIn government. With South Korea struggling to improve relations with its northern counterpart and the US threatening to terminate its alliance relationship with Korea should the latter not increase its share of defense responsibility, the Moon government was caught in a difficult position and had to search for outlets that promise potential diplomatic success. As relations with China and Japan remain tense as well, South Korea looks to Southeast Asia as the breaking point. Yet the irony is that no matter how successful the New Southern Policy may be, relations with North Korea, the US and China will continue to be prioritized by the general populace, which in turn challenges continued efforts to engage Southeast Asia. With the New Southern Policy

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lacking noticeable results thus far, the Moon Jae-In government may be hard tasked in further pursuing the policy. In the case of Japan, the fact that its southbound policy is part of the greater IPS makes the Abe government’s challenge different from that of Taiwan and Korea. Unlike its neighbors, solid relations with India and ASEAN countries suggest that Japan does not have a market entry problem. The challenge for Japan, rather, stems from a regional leadership crisis in the face of China rising and the US’ loose support for its partners in Asia. In the new situation, despite an established US–Japan Alliance, Japan is forced to consider its response to China’s increased influence and whether to take on a stronger leadership role in the region, reminiscent of its status in the 1980s. The Abe government adopted a mixed response towards China and the BRI—while rising up to the leadership vacuum that Washington opened up, it is also competing with Beijing through the IPS while remaining open to repairing bilateral relations. The deep-seated issue behind the politics is economics. Noting Japan’s prolonged economic stagnation into the second decade of the new century, China remains a priority that any Japanese leader in the PM Office must deal with skillfully regardless of the condition.

Conclusion This chapter briefly reviews the development of the respective southbound policy of Taiwan, South Korea and Japan and notes three structural challenges that may implicate the success of the policies. It is clear that in the face of expanding Chinese influence, namely the BRI, South and Southeast Asia seem to be the optimal alternative for balancing China, considering the strategic significance and market potential of the region. Meanwhile, the continued rebalance towards Asia by the US through the IPS is an important factor for Taiwan, Korea and Japan to turn south as well, particularly towards the Indian Ocean. Among the three countries, Japan’s established Indo-Pacific vision more than a decade ago puts it slightly ahead of the group in consolidating relations with India to balance China. In contrast, Taiwan and Korea need to expend more efforts in courting the favor of India. While this chapter considers the southbound policies in relation with the factors of China and the US—perhaps rightfully so, as the two countries have unmatched significance in the foreign policy of Taiwan, Korea and Japan—less is mentioned about the role of India and ASEAN countries, which ultimately determine the success of the policies. Regarding India, interestingly, echoing the described southbound policies, New Delhi has also adopted a Look East Policy that seeks to strengthen its relations with Southeast Asia (Pant, 2013, pp. 453–466). In such sense, while India plays a critical role in the strategic calculus of many states, Southeast Asia seems to be the key region that decides the success and failure of containment efforts against China. Within ASEAN, in the face of the BRI, IPS and other policies to court their support, member states vary in their position towards the various vested interests in the region, with many countries supporting the BRI while claimant states to the

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South China Sea continue to stand up for their sovereign interests against Beijing, even at the risk of conflict. In short, the immediate future of the Indo-Pacific region remains in flux and the success of the described southbound policies warrants further observation.

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Tony Tai-Ting Liu is an Assistant Professor jointly affiliated with the Center for General Education and the Graduate Institute of International Politics, National Chung Hsing University, Taiwan. He was previously associated with The University of Tokyo, Australian Catholic University and University of Tuebingen. His research interests include International Relations Theory, International Political Economy, East Asia international relations, Chinese foreign policy and ChinaTaiwan relations. He has published in the Brazilian Journal of International Politics, Japanese Journal of Political Science, Social Transformations in Chinese Societies, Review of Global Politics (Chinese), Taiwan International Studies Quarterly (Chinese), and Asian International Studies Review.

Chapter 17

The US and the Indo-Pacific: Trump’s Policy Towards the Region Dr. Kimberley Anne Nazareth Kimberley Anne Nazareth

Abstract President Trump has reignited interest in the Indo-Pacific as a result of his strategy towards the region. Interest in the region has always been part of US foreign policy, this is especially true with the end of the Cold War. There were numerous factors that led to this, combating China has been one of the main factors on the President’s agenda, in an effort to achieve this, the Trump Administration put forward the Indo-Pacific Strategy (IPS). The motive behind this is both international and domestic. On the international front, there has been a growing need to reassure regional allies against China. On the domestic side, during the 2016 presidential campaign, Trump found it beneficial to attack China on an array of issues that pleased his electoral base. During the early stages of the administration, there was a general fear among the regional allies that the Administration was abandoning them. The president has made multiple moves in an effort to further the strategy both at a regional and domestic level. This chapter will examine the motives and mechanisms of President Trump’s strategy both domestic and international.

Introduction As President Trump’s first term nears the end it is important to analyze the president’s policies. One of the major undertakings by the administration has been its focus on the Indo-Pacific. This chapter seeks to analyze the domestic as well as the regional dynamics of the IPS. There are various components that contribute to the making of foreign policy; these can be broadly divided into two interrelated aspects of domestic and international components. The domestic components include; the executive and the congress together with the economic and political impact. The international mostly comprises the allies and adversaries of the US. These components are often intermestic. In such a political climate it is often difficult to separate foreign policy from domestic policy and vice versa. K. A. Nazareth (B) Jawaharlal Nehru University, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_17

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US-Policy Towards the Asia–Pacific From a historical point of view, the US has been involved with the region since the Empress of China set sail for China across the Atlantic Ocean in 1784. The US active involvement began with the USS Essex which became the first navy vessel to Asia. From 1881 onwards the US dispatched naval ships to the region. The US presence in the region began to expand and strengthen. In addition to this, US trade expanded with estimates of USD 92 million in 1897. In addition to these developments, the US also expanded territorially with Hawaii, the Philippines, Guam and part of Samoa (Auslin, 2018). The US entrance in World War II sealed its presence in the region. After the war, the US occupation of Japan as well as a permanent military presence in Asia further strengthened Washington’s position. The Cold War propelled the international community into a complex multilateral and bilateral system of alliances. In the Asia– Pacific region, the US presence was strengthened by SEATO and ANZUS. In addition to this, the US naval bases were a major part of US presence in the region. The Vietnam War, ensured the US military position in the region. During the post-cold war, both President Bill Clinton and George W. Bush attempted to concentrate their attention on the region, specifically China. President Clinton expanded China’s role with the international community including trade with the US. However, the 9/11 terrorist attacks together with the quagmire created in Iraq (Tow & Loke, 2009). Obama pledged to refocus US attention to the region. Through his strategy of the “rebalance” or “pivot” The administration displayed the importance of the Asia– Pacific with Hillary Clinton calling this century the Pacific century. The members of the Obama administration actively engaged with ASEAN in an effort to further its regional policy. Obama’s approach towards China (though adversarial) required China as an ally especially in his policy towards Iran. In an attempt to shore up support for the allies, President Obama along with 11 nations negotiated the TransPacific Partnership (TPP) to counter China and the One Belt One Road (OBOR). As part of engaging with the allies in the region, Obama attended ASEAN and East Asia Summits as well as appointed Ambassador to ASEAN. The president also invited Indonesia to be part of the G20 (Heydarian, 2017).

The Trump Administration and the Indo-Pacific In January 2017, President Donald J Trump was sworn in as the 45th President of the US, Trump made “America First” the benchmark of his agenda. During the election, the President portrayed a return to realism mirrored by his predecessors like George Washington and Thomas Jefferson as well as the populism of Andrew Jackson. Trump’s ‘America First’ policy focused on an American-centric foreign policy, one that was based on foreign policy that benefited the US especially economically as well as diplomatically. This was on display with withdrawal from the Paris Climate

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Accord, the TPP as well as the Iran Deal. In addition, it also meant a renegotiation of trade deals like NAFTA. It also meant a focus on isolationism rather than internationalism. This troubled many. Therefore, as part of the America First, the president continues to reshape America’s role in the international community which could have severe repercussions on the US leadership worldwide (O’Rourke, 2021). Trump signaled his policy towards the Asia–Pacific on the first weekend as President by signaling the US withdrawal from the TPP. The withdrawal not only fulfilled the campaign promise but at the same time undermined the US vision for the region, one that would compete with China’s OBOR strategy (Fly, 2018). US interest in the region began with reining in China and North Korea under the previous administration and has continued under the current administration. During the election, Trump lambasted China over its territorial disputes as well as its currency manipulation and posturing in the South China Sea (SCS) to name a few. Beginning in 2018, the administration imposed a series of tariffs on goods exported to China. This was in accordance with the Tariff Act of 1974. The bilateral talks between the two broke down on numerous occasions however, the two were able to reach a temporary agreement. Approximately 67% of U.S. imports from China were subject to increased tariffs, most in the range of 15–25%, while approximately 60% of China’s imports from the US faced additional tariffs, most in the range of 5–25%. Both sides escalated the tariff war throughout 2019 (Williams, 2019). In January 2020, the two sides reached an agreement and signed the first phase of the agreement, though tariffs are still in place. As per the agreement, Beijing agreed to buy $200 billion more of US goods over the 2017 agreement. For the US, the agreement heralded a “momentous step… to the future of fair and reciprocal trade” between the two. This was an attempt to wane off the subsidies provided by the US to farmers in an effort to make up for the lack of expertise to China (Agencies, 2020). In dealing with Pyongyang, Obama attempted to negotiate with nuclear power but was unsuccessful. The policy of “strategic engagement” and “strategic patience” were unsuccessful (Obama, 2010, 2015). For the Trump administration, reaching a deal with Pyongyang was an important part of his agenda. The leaders of both countries have met three times; first in Singapore, in June 2018; in Hanoi, in February 2019; and a final time at the Korean Demilitarized Zone in June 2019 (Panda, 2020). Despite the shifts in US policy towards North Korea, the Kim leadership continues to pose a threat to the region as well as the international community. However, despite the deal, Pyongyang continues to expand its arsenal as well as the testing of missiles. At the same time, it is pertinent to point out that Trump’s meeting with Kim Jong Un in Singapore though signaled a starting point in the negotiation process, one has to be wary of the regime involved as well as confidence in upholding its end of the deal. For North Korea, the implosion of sanctions threatens talks with Washington. If the US were to alleviate sanctions on Pyongyang, it could lose its leverage (2020). Therefore, in an effort to deal with the rising threats from Beijing and Pyongyang as well as reassure the allies and satisfy Trump’s partisan base at home, the administration put forth the Indo-Pacific Strategy (IPS). The region is important for strategic as well as economic reasons. The Trump administration perceives the Indo-Pacific as a zone where America’s economic future lies. It houses the world’s most dynamic

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economies and more than 50% of the earth’s population; obviously, this can be a very lucrative market for U.S. businesses. Around 60% of the global maritime commerce passes through Asia (Pitakdumrongkit, 2019). The term Indo-Pacific was not a concept that was framed by the Trump administration. In fact it was Shinzo Abe, the Japanese PM who first used the term Indo-Pacific in 2007. Later, the Australian Defense White Paper 2013 also mentioned the idea of the Indo-Pacific. In 2017, the Indian Prime Minister, Narendra Modi had also used the term during this visit to the US. The term was used in 2011 by Secretary Hillary Clinton and thereafter was used on numerous occasions. The regional countries in fact have welcomed the IPS. The Australian Prime Minister voiced reservations on the mechanisms used in the region that specifically related to China and US tariffs. The Japanese though supported the policy worried about the US sustaining interest in the region (Choong, 2019). The first time the Trump administration used the term “Indo-Pacific” was in October 2017 by Secretary of State Rex Tillerson. Therefore, Tillerson became the first senior US official to switch from using the term Asia–Pacific to Indo-Pacific. The use of the strategic term was with respect to the administration’s relations with India. The speech at CSIS also asserted the idea of a free and open Indo-Pacific (Fly, 2018). In 2017, at the APEC Summit (Vietnam), the President put forth the idea of a “Free and Open Indo-Pacific” (FOIP) and US commitment to a “safe, secure prosperous” region. The notion of the IPS was additionally reiterated in the NSS 2017. The NSS laid out the political, economic, military and security aspects of the IndoPacific. The NSS reiterated the administration’s commitment to the alliance. It stated a “redouble” of its commitment to the regional allies. On the economic front, it laid out the need for “cooperation to free and open seaways, transparent infrastructure financing practices, unimpeded commerce, and the peaceful resolution of disputes”. The NSS mentioned the strengthening of bilateral relations however it failed to mention regional organizations that have been long-standing in the region. As part of the security dynamic, the security risks posed by North Korea and working towards the denuclearization of Pyongyang were of prime importance as well as maintaining strong relations with Taiwan. In addition to North Korea, China was considered an additional threat to the region (Trump, 2017). However, the NSS though mentioned the term Indo-Pacific did not clarify the mechanisms through which the strategy would be conducted. At the 2018 Shangri-La Dialogue, US Secretary of Defense, James Mattis took the opportunity to “reinforce the significance of a free and open Indo-Pacific region”. Tillerson described the Indo-Pacific as the Indian Ocean, the Western Pacific and the surrounding nations. It was in the preceding months with the NSS that the administration’s strategy began to evolve (Choong, 2019). It was in the Department of Defense’s “Indo-Pacific Strategy Report, 2019” (IPSR) that the principles were further flushed out. The report reflected on the ideas of sovereignty, conflict resolution through peaceful means, free fair reciprocal trade and adherence to international norms (DOD, 2019). It was the first document on the region since the Clinton Administration’s Asia–Pacific document. The IPSR outlined aspects which included; historical, geographical, defense as well as partners and partnerships. The administration’s vision of territorial sovereignty as well as “mutual

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respect, responsibility, priorities, and accountability” (DOD, 2019). In addition to the DOD’s report, the State Department has also released its. Report which outlines the idea of the FOIP. The president’s strategy includes economic, diplomatic as well as defense. As per the report the US trade amounts to USD 1.9 trillion in two-way trade. The Department of State and the U.S. Agency for International Development (USAID) have provided the region with over USD 4.5 billion in foreign assistance (State Department 2019). The administration’s commitment to the IPS was additionally displayed through the Indo-Pacific Business Forum in 2018. In July 2018, Secretary of State Mike Pompeo spoke at the Forum in an effort to layout the economic components of the FOIP (Harding, 2019). At the cabinet level, there have been new initiatives undertaken in an effort to expand U.S. public and private investment in Indo-Pacific infrastructure, energy markets, and digital economy. The Vice President also announced the Indo-Pacific Transparency Initiative to attract countries to high-quality investment by strengthening civil society and good governance (DOD, 2019). In an effort to bolster the administration’s position in the region, Secretary Pompeo announced modest new initiatives which included USD 113 million support for initiatives on the digital economy, energy and infrastructure. This however pales in comparison to the amount the Chinese are spending on the One Belt and Road Initiative which is in billions. In addition to this, Mike Pence as Vice President addressed the APEC meetings and the East Asia Summit in November 2018. During his visit, the Vice President promoted the BUILD Act that had bipartisan approval from Congress. Pence also announced new initiatives being promoted by the administration which included cybersecurity (Reuters, 2018). Since the announcement of the IPS, the administration has taken steps to reinforce the strategy. In May 2018, Secretary of Defense James Mattis announced the renaming of the U.S. Pacific Command to U.S. Indo-Pacific Command (INDOPACOM). This was aimed at quelling the fears of uncertainty in the region and shoring up US commitment. In addition to this, China’s continuous flexing of its muscles in South China and East China Sea. The change in name, grants Washington increased mobility in the region by sailing in the SCS near the disputed islands like Paracel Islands. Therefore, it seems as though the US is becoming bolder in its actions in the region (Browne, 2018; Copp, 2018). This is especially true with Washington sending additional carriers to the region. As the US continued to increase its presence in the SCS, there has been a fear of a “face-off” between the regional heavyweights. According to reports, INDOPACOM has drawn up plans to have ships and aircrafts operating close to Chinese forces. There have been numerous close calls between the two especially with the USS Decatur (Ng, 2018). In 2018, the “flesh and bones” of the policy were put in place. In June Mattis at the Shangri-La Dialogue outlined the increasing attention being given to the region. The administration has also focussed on the importance of engagement with ASEAN, the Quad. This was an effort on the part of the administration to reassure the regional allies and organizations of US support. However, this has not always been communicated clearly to the region. The IPS has focused more on bilateral relations rather than

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multilateral. However, in moving away from the TPP there could also be considerable harm done to US agricultural interests as exporters are locked out of liberalization afforded to remaining TPP members (Green, 2019).

All Politics is Local: IPS and US Internal Politics On the domestic front, a president’s policies in most cases have to be approved by Congress. This especially pertains to treaties, appropriation of funds, sale of arms to name a few. It is in these cases that the two branches of government—the executive and congress have to work in tandem if not it could lead to gridlock. The relations between the administration and congress are very often described as a “pendulum” and are usually based on partisan control. Historically, when both branches are controlled by the same party, presidents have been far more successful in passing their policies. This has been especially true with the increase in polarization of parties in congress. Partisan polarization is commonly seen in matters pertaining to domestic rather than foreign policy. In matters pertaining to foreign policy, congress acquiesced to the president. On matters pertaining to the Asia–Pacific, the current structure of domestic politics is more inclined towards deeper engagement with Asia rather than retrenchment. However, polarization is an important caveat in the making of foreign policy. In the surveys, Americans do not list foreign affairs as the issue they primarily vote on. Moreover, populist candidates like President Trump have demonstrated the ability to swing the foreign policy views of their base in new and often unlikely directions (Green, 2019). While making decisions on matters pertaining to foreign policy, a president usually turns to allies at home. President Trump, is in tune with core supporters therefore decisions are made in an effort to bolster their support. This was especially true with the withdrawal from the TPP. The core domestic support for the TPP among the GOP was negligible, therefore the President in the first weeks in office vehemently pushed against it. Another issue that is important to the president that will benefit politically is Washington’s economic attack on China. According to PEW, 52% of the public see China as a major threat, Republicans and Republican-leaning independents are somewhat more likely than Democrats to consider China as an adversary (PEW, 2017). The inner circle of President Trump continues to tow a hardline on China. During the campaign, candidate Trump called China a currency manipulator as well as promised to levy tariffs—49%. Trump has levied 15% on over USD125 billion on Chinese goods. In return, China revived a 5% tariff on US goods (PTI 2019; Reuters 2019). The two sides have come to an agreement over trade but US tariffs still remain in place. The president’s advisors often play an important role. In the case of the administration, the former NSC advisor John Bolton was considered to have a great deal of influence on the President’s policies. This was especially seen on matters pertaining

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to Iran and North Korea. It was Rex Tillerson the sen Secretary of State that was the first to use the term “Indo-Pacific” at CSIS (Maini, 2018). The Secretary of Defense James Mattis and Tillerson visited the region in an effort to bolster the administration’s presence in the region. Later, Secretary Mike Pompeo also made several visits in an effort to bolster the US policy as well as strengthen the alliances (Archis Mohan, 2017). Mattis, during the Shangri-la Dialogue was able to clarify the administration’s strategy. He reiterated the shared principles that underpin the FOIP (Graham, 2018). Congress took a step forward when it came to its support for the strategy. After a series of congressional hearings between 2017 and 2018, Senator Cory Gardner (R-CO), Chairman of the Subcommittee on East Asia, the Pacific and International Cyber Security put forward the Asia Reassurance Initiative Act (ARIA). The resolution passed by a voice vote and President Trump signed into law in December 2018. The resolution made provisions for congressional oversight and aimed to advance interests, improve defense capacity, to conduct bilateral engagements (2018). The bill displayed a commitment to a FOIP. Additionally, it was aimed at a more “comprehensive and focused energy strategy” towards the region (Lohman & Smith, 2018). The resolution provided the president domestic support for his international endeavors. This has been especially important when it comes to the international allies. Such a step by congress in support of the president’s policy was aimed at dispensing the trust barriers of the allies in relation to the FOIP. In addition to this, congress also put forth the Better Utilization of Investments Leading to Development Act of 2018 commonly known as the BUILD Act. The aim of the act was to “consolidate American development financial authorities”. The House and Senate passed the legislation in September and October 2018 by a vote of 398–23 and 93–6, respectively. Trump signed the act into law on October 5, 2018 (2019). The Act was aimed at consolidation as well as highlighting the connectivity in the region. It established a new agency—the U.S. International Development Finance Corporation (IDFC). It consolidated and expanded existing U.S. government development finance functions, which are conducted primarily by the Overseas Private Investment Corporation (OPIC) and some components of the U.S. Agency for International Development (USAID). The administration supported the BUILD Act as it was consistent with its goals (Akhtar & Lawson, 2019).

The US Allies and IPS: Rhetoric and Action The regional alliances are an important aspect of the IPS. The system of alliances in the Asia Pacific can be described as “hub and spoke” wherein the US is at the centre of the alliances in the region. However, this was altered to form a “web”, Washington was enriched by the bilateral alliances as well as pursued military confidence-building measures. In the post 9/11 era, the US has found it prudent to strengthen ties with countries in the Asia Pacific—as the US continues to play a pivotal role one matched only by a growing China (Koga, 2011).

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The Obama administration focused on the system of alliances, as well as used regional infrastructure in an effort to aid foreign policy endeavors such as APEC, ASEAN and others. However, Obama’s relatively conciliatory attitude towards China, perturbed many allies (NSS, 2010, 2015). Under the Trump administration for most part, relationships with the allies were built on personal associations between the US leadership and the regional leadership. As a result of this, if personal relationships between leaders broke down, it could create strategic complications. Trump has had difficulties in his relations with the regional partners; this has been true with Japan and South Korea. Presidential rhetoric on ‘burden sharing’ created a trust deficit among the allies. As time waned, the tone towards the Asian allies underwent a change however the trust deficit still persisted. The IPS is geared towards calming fears of the allies (Green, 2019). From a leadership perspective, the measure of a leader lies in the on his ability to carry as well as work with allies. This is also considered the hallmark of maintaining US national interest. The IPSR (2019) mentions the importance of regional organizations as well as regional engagement in the pursuit of the strategy. The strengthening of ties through ASEAN as well as working with East Asian Summit, ARF. In October 2018, the ASEAN Defense Ministers agreed to conduct ASEAN-US Maritime Exercise AUMX to bolster relations (IPSR 2019). Washington has been sketchy in its actions towards ASEAN. For instance, the absence of the president at the ASEAN summits has created a trust deficit. In 2018 and 2019, the president was absent from the summits which have questioned US commitment to the region. The absence of the president leaves greater room for China to maneuver (The Associated Press, 2019). As part of the FOIP, working with ASEAN and APEC are key pillars to Trump’s policy towards the IPS. Therefore, integrating ASEAN into the US strategy was considered an important tool in the IPS. A comprehensive strategy included all aspects of security, economics as well as people-to-people. During the Obama years, US ties with ASEAN expanded with the appointment of an Ambassador to ASEAN. As a result of US–ASEAN relations, the US also expanded its influence to the EAS. In 2015, ties between the two were elevated to the degree of strategic partner and in 2016, the U.S.-hosted U.S.-ASEAN Leaders’ Summit (Ford, 2019). With the president’s absence at the ASEAN meetings, the US has been working on the idea of holding a Summit of ASEAN leaders in 2020. The invitation comes as a step in the furthering of the IPS and the FOIP. It sends a positive signal of working with the governmental as well as non-governmental institutions. However, though the proposition of a summit points in the right direction, it may be unsuccessful in settling the policy concerns of regional players (Parameswaran, 2019). The US has also made strides with APEC. At the Economic Leaders Meeting of APEC, the US launched the U.S.-Support for Economic Growth in Asia (US-SEGA). It aimed at “technical assistance”. It was a five-year program with USD 9 million in U.S. funding. The focus has been on building APEC economies to adopt and promote fair trade and open markets (IPSR 2019). The administration has renewed the Quadrilateral Security Dialogue or Quad. The Quad is a functional forum for diplomatic overtures. It is, made up of the democratic governments of the US, Japan, Australia and India were essential towards

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“forwarding a common cause”. At the first meeting in November 2017, the administration signaled support through multilateral dialogues as a way of combating China. The successive meetings that were held in June 2018 and November 2018 reiterated the idea of preserving “rule-based order”. However, members within the Quad have expressed concern to tread lightly so as to avoid being seen as a solely military alliance set up to counter China. India in retrospect has also begun to soften its position on China in an effort to alleviate fears (Grossman, 2019). In September 2019, the Quad met in a ministerial-level meeting. This was “significant elevation” among the four which aimed at bolstering the IPS. The US for the time being has used Quad to signal “unified resolve against China” rather than for antagonistic purposes (“Minister-Level Quad Meet an Elevation of Indo-Pacific Dialogue, Says US | Latest News India -Hindustan Times,” 2019). There have been questions raised as to the importance and longevity of the Quad. The drawback of Quad pertains to the fact that it lacks formalization as an alliance. Therefore, it lacks intelligence-sharing between its members. However, there are increasing signs of information-sharing in a number of military sectors, including maritime domain awareness (MDA). Hence, the members are strengthening their networks in the region. The members are also conducting joint exercises to improve interoperability, military and defense technology transfer and capacity-building (Hanada, 2019). In addition to multilateral engagement, the administration has focused far more attention on bilateral agreements that are equal trade agreements. The main tenets of US policy: rebalance of trade agreements, re-negotiate outdated agreements, aggressive enforcement of US trade law and lastly defending US interests at the WTO (BDI, 2020). US–India relations have come a long way since the Cold War. New Delhi is considered a strategic partner of the US. In renaming US policy towards the region, the IPS, the president ensured that India will be a vital player in the region. Through the success administrations, relations between the two increased especially in matters pertaining to defense sales. The 2+2 dialogue between India and US reflects the growing special relationship between India and US. The two sides also continue with its Maritime Dialogue with the Indo-Pacific in view (2019, 2019). In February 2017, the then Secretary of Defense James Mattis in a phone conversation with his Indian counterpart, reiterated the progress between defense cooperation. During an April 2017 visit to New Delhi and other regional capitals, the President’s then National Security Advisor, H.R. McMaster, met with Prime Minister Modi and other top Indian leaders reiterated the importance of the relations (Kronstadt & Akhtar, 2017). In August 2019, the 2 + 2 US-India were geared towards elevating the relations. There were a number of takeaways from the meeting that included; setting up of a hotline between the four, strengthening the defense ties and both sides seem to put pressure on Pakistan regarding Kashmir. In addition to these aspects, the IPS was also a feature. They jointly stated to “Work together and in concert with other partners toward advancing a free, open, and inclusive Indo-Pacific region, based on recognition of ASEAN centrality”. The two sides also discussed a major concern for both sides that is

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China. However, on the issue of China, the two stuck to general positions rather than any posturing (2019, 2019). The two sides are to conduct a joint military exercise called “Tiger Triumph”. It includes the Army, Navy and Air Force. The exercise is aimed at humanitarian assistance and disaster relief. U.S. arms sales to India have reached all-time highs. In 2019, for example, the first tranche of U.S.-made Apache attack helicopters was delivered (Bowman & Gabel, 2019). India is also scheduled to purchase USD 7.5 billion worth of defense equipment (2019). Along with India, the US also views Australia as a key ally. According to a survey conducted by the Lowy Institute in 2017, 65% and in 2018 64% believed that the two countries should remain close (Seymour, 2019). In August 2019, the PM of Australia visited the US, this was his second visit. The aim was trade and security given the increase in regional posturing by China. In addition to Morrison’s visit, the two leaders met on the sidelines of the G20 Summit in an effort to bolster relations (Holland, 2019). The US-Australia defense pact accounts for 60% of Australia’s 10-year budget. The security links have been further strengthened through the Talisman Saber military exercises. The 2017 military exercise involved 33,000 US and Australian troops aboard varied battleships. An Indo-Pacific orientation has also become explicit since 2017, with AUSMIN pledges “to increase bilateral collaboration in relation to the Indo-Pacific” (The Department of State, 2017). In addition to this, the 2018 President Trump and then-Prime Minister of Australia Malcolm Turnbull signed a Joint Declaration of 24 July 2018 which made multiple references to the “Indo-Pacific” (Scott, 2018). Despite the close ties shared by the two countries, there are key political voices within Australian who display a lack of trust with US policy; this has been especially local to opposition leader Bill Shorten’s condemnation of the president. The balancing between China and the US is proving to be far more difficult (“Australia: Background & U.S. Relations”, 2017). The US–Japan relations though has hit rough patches especially as a result of President Trump’s rhetoric nevertheless the president has developed a close working relationship with Prime Minister Abe. As part of the regional defense, the US delivered the THAAD missile system during the first months of the Trump presidency but had been sanctioned by President Obama. This was part of the protection against North Korea. In addition to this, the U.S. State Department has sanctioned the sale of ballistic missile defense to Japan. The cost was estimated at USD 1.15 billion subject to congressional authorization (Yeo, 2019). In addition to the four major players in the region, the US seeks to expand relations with other countries as well. This began with the US rapprochement to Vietnam under the Obama administration. Under Trump, the relations with the Duerte of the Philippines have improved. The Mutual Defense treaty has aided in this endeavor. In addition to this, the two sides have conducted joint military exercises “Balikatan”. The first such exercise took place in March 2019 with 7500 troops. The Philippines was slated to receive USD 60 million out of the USD 300 million in regional security assistance. This was announced in 2018 by the State Department. The DOD has also

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provided military assistance under Indo-Pacific Maritime Security Initiative (Lum & Dolven, 2019). The Trump administration has attempted to reinvigorate relations with Thailand. In the past, Thailand provided the U.S. military access to important facilities like the Utapao airbase. The Cobra Gold joint military exercises are an important facet in security ties which has bolstered the relations. In October 2017, PM Prayut Chanocha attempted to reassure the US by promising to purchase 20 Boeing passenger planes and US military hardware including helicopters. In August 2019, the Thai military announced plans to purchase 120 American-made armored vehicles by 2020. In addition to this, Thailand agreed to purchase 8 Boeing attack helicopters and reconnaissance aircraft, as well as air-to-surface missiles, in a deal valued at USD 400 million (Crispin, 2019). Singapore, though not a US treaty ally is nevertheless considered an important strategic partner. The security alliance was formalized in 2005 through the Strategic Framework Agreement. Additionally, Singapore has played an important role in hosting the Trump-Kim Summit that aimed at defusing the threat from Pyongyang. The two sides have renewed their defense ties wherein American forces are allowed the use of Singapore bases for the next 15 years. The renewal of the 1990 MoU concerning US bases reinforced US commitment to the IPS. Both sides also discussed the progress of key initiatives, such as in defense technology and military-to-military cooperation and US support for the Singapore Armed Forces (SAF). The SAF uses US air force bases such as Luke in Arizona and Mountain Home in Idaho as training locations. The longest-running bilateral exercise is the “Tiger Balm” military exercise between the two since 1981 (Yong & Zang, 2019).

Assessment of the Trump’s Policy In assessing the first term of Trump’s IPS, the domestic and the regional factors play a crucial role. Congress which for the most part though polarized has nevertheless supported the IPS. In fact, Congress has authorized funds as well as infrastructure to make the IPS a reality. In addition to this, it continues to provide funds as well as authorize the sale of defense equipment to regional allies which is an important component of the strategy. In part, Trump’s motivation for greater focus on the region has been to appease his voter base. President Trump won the rust belt states of Pennsylvania, Michigan, Iowa and Ohio. This in part because of his promise to bring back manufacturers to the US and rein in China. The withdrawal from the TPP, fierce anti-Chinese rhetoric coupled with the tariffs war, the president has been driven by the need to shore up his voter base for the upcoming 2020 election. Many Democrats in Congress fear that his harsh stance against China as well as other countries will have an adverse effect on the US economy, allies and position in the international community. The regional allies have welcomed the changes in US strategy especially the change in name of the US policy. However, the allies are uncertain of Trump’s

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commitment to the region. In addition to this, the allies have to maintain a tight rope and balance their relations with the US and China strategically, this however is becoming increasingly difficult. In the final analysis, it has been difficult to assess Trump’s policy towards the region however, whether it was the Asia–Pacific or the Indo-Pacific, there is no doubt that the US will remain in the region for generations to come.

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Kimberley Anne Nazareth is currently teaching Global Politics at Bombay International School. She has received her Ph.D. from the Center of Canadian, US & Latin American Studies, School of International Studies, Jawaharlal Nehru University, New Delhi. She was a Fulbright-Nehru Doctoral Scholar 2017–2018 at the American University, Washington D.C. she has also worked at The Institute of Peace and Conflict Studies, New Delhi.

Chapter 18

Belt and Road Initiative Versus Indo-Pacific Strategy: Increasing US-China Strategic Distrust Behzad Abdollahpour

Abstract Since normalization of relations US–China trajectory has undergone many ups and downs. Their cooperative and confrontational tendencies are always sources of conflict between scholars. These issues come to the fore by the inception of Belt and Road Initiative (BRI) and Indo-Pacific Strategy (IPS) which have been considered the central part of Xi Jinping and Donald Trump’s foreign policies. While US authorities worry about the implications of China’s BRI, their Chinese counterparts construe IPS as an attempt to contain Beijing in particular and its BRI in particular. These perceptions are leading to create a climate of distrust in US–China relations which would intensify the strategic competition between them. Therefore, the major focus of this study is to examine BRI and IPS from both Chinese and US perspectives to gain a deep understanding of them. The author further discusses some opportunities and challenges they may be faced with, in order to better illustrate the strategic distrust between US and China.

Introduction Richard Nixon and Mao Zedong’s meeting in 1972 represented a watershed in the history of US–China relations which has influenced the cooperation patterns of Sino– US relations. The incidence offered US an opportunity to understand the Chinese state of mind in which “Chinese leaders pragmatically seeking cooperation for practical reasons having to do with international and domestic circumstances” (Sutter, 2010, p.4). Since then Washington has taken engagement policies towards Beijing. A typical example was the China policy of the Obama administration in which he took a cooperative stance toward China to deal with some global issues including climate change and lethal pandemics (Mori, 2019). However, the Trump administration takes a completely opposite approach towards Beijing and states that China does not met with the expectations and rules of US-led world order. Donald Trump criticizes previous US administrations for pursuing engagement policies vis-à-vis B. Abdollahpour (B) Faculty of World Studies, University of Tehran, Tehran, Iran e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 P. Jaiswal and D. P. Bhatt (eds.), Rebalancing Asia, https://doi.org/10.1007/978-981-16-3757-5_18

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China, and depicts China as a revisionist power and a strategic competitor which seeks to “erode American security and prosperity” in political, economic and military spheres (Cordesman, 2017). After the inception of China’s BRI and US IPS the cooperative and confrontational tendencies come to the fore and mutual suspicion and distrust overshadow Sino–US relations. While Barack Obama relied on his Pivot to Asia to deal with the rise of China, Donald Trump purposed his Indo-Pacific Strategy to compete and isolate China in Asia. Therefore, like his predecessors, he took the same way to contain the rise of China. But what distinguishes Donald Trump from Barack Obama is their different approaches towards Chinese initiatives. While Barack Obama dismissed Chinese initiatives and didn’t take any effective measures to deal with them, Donald Trump openly criticizes them and reiterates that one of the major goals of his IPS is to balance the growing economic and military influence of China in the Indo-Pacific region. He is not optimistic about the role of BRI in Sino– US relations and gives high priority to trade issues, such as narrowing US-China trade deficit. On Chinese part, they evince deep concern over US military presence in the Asia–Pacific and its attempts at creating military alliances, since they consider such measures as a threat to Beijing’s security. Moreover, China attributes the deterioration of US–China relations to US unilateral policies (Hass, 2018), and notes that US interventions in the Indo-Pacific region heighten the tension between Beijing and its neighbor countries. Chinese authorities, indeed, reiterate that unlike US IPS which aims to counter China in general and its BRI in particular, China’s grand initiative does not seek to counter any country or specific initiative (Wang, 2019). There are some questions regarding the influence of BRI and IPS in Sino–US trajectory, such as what is US response towards China’s BRI? What is China’s response towards US IPS? To what extent BRI and IPS influence Sino–US relations? There can be a myriad of different opinions and answers. However, this study resorts to US and Chinese official documents and the opinions of distinguished pundits who have expertise in Sino–US relations to answer these questions. In fact, the dual focus of this study is premised on US and Chinese perceptions of BRI and IPS which would shed light on their strategic rivalry and its implications for Sino–US relations.

US Perceptions of BRI Since Barack Obama assumed presidency in the White House, “BRI occupied a minor place in the hierarchy of issues that made up US China policy”. Therefore, the Obama administration didn’t purpose a comprehensive view of BRI. In contrast, Donald Trump tends to develop a strong strategic response to BRI in infrastructure and economic spheres. For instance, he sought to reform US “development finance institutions”, and support “private sector investments”. Moreover, he asked International Financial Institutions (IFIs) to “dedicate greater resources to large-scale infrastructure projects”. As for challenging BRI in infrastructure sphere, the Trump administration seeks to establish and deepen cooperative ties with its allies and

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partners to offer “high-quality... infrastructure investment alternatives in the IndiPacific region” (Kliman, 2018, pp. 4–5). In fact, BRI came under fierce criticism under Trump administration. Rex Tillerson, former US Secretary of State, and Mike Pence, US Vice President, heavily criticize debt trap policies and poor qualities of BRI’s projects (Dodwell, 2018; US Committee on Armed Service, 2018). Generally, Americans are suspicious about China’s BRI, since they have a lot of questions about the motivations behind this initiative that remain unanswered. They repeatedly reiterate that Chinese authorities should determine the position of great powers such as US in BRI. Alek Chance, Research Fellow and Program Coordinator at the Institute for China-America Studies in Washington, believes that economic and political facets of BRI are clear in China, but it is unclear that how does BRI affect US–China relations. He points out that BRI prompts concerns and suspicions among American scholars. For instance, Chance maintains, they worry that China may challenge the existing political and economic order, and replace them with Chinese one (Chance, 2016). US scholars frequently express similar concerns. Ely Ratner, executive vice president and director of studies at the CNAS, points to the strategic significance of BRI which can pave the way for putting “China at the center of international politics”. He states that BRI may create an “illiberal regional order” in which “democracy and individual rights are largely subservient to economic growth and social stability”. Ratner also believes that BRI will create a Sino-centric economic order in Asia (Ratner, 2018, pp. 2–3). Thomas Cavanna, professor of Strategic Studies at Tufts University, takes a step further and believes that BRI could jeopardize the precepts of US hegemony emerged after WWII. Therefore, in order to keep its global hegemony, he maintains, US should take China’s geo-economic initiatives more seriously, which extend China’s influence in the Eurasia. Cavanna also underlines the naval dimension of BRI which can bolster China’s position in the Eurasia and thereby marginalizing US geo-strategic influences in the region. (Cavanna, 2018). Thomas J. Shattuck, Managing Editor at Foreign Policy Research Institute considers BRI as a “debt trap diplomacy” which sought to make member countries economically dependent to Beijing. Moreover, he argues that China resorts to BRI in order to increase its influence in the world under the guise of “infrastructure development projects” (Shattuck, 2018). Similarly. Yet, Among American scholars, there are some who highlight the positive aspects of BRI. For instance, Joshua Meltzer, senior fellow in the Global Economy and Development program at the Brookings Institution, believes that BRI has several economic and strategic objectives. He maintains that BRI projects facilitate trade in Asia, accelerate the export of Chinese Standards, such as high speed rail (Meltzer, 2017). Similarly, Kenneth Judd, senior fellow of Hoover Institution at Stanford University, believes that BRI creates a “transportation network” which can facilitate the flow of goods and connect Chinese market with global markets, thus it is highly beneficial to the world economy (China Daily, 2018). Therefore, it seems that the roots of US pessimism towards BRI lies in three factors: Lack of transparency in specifying the future objectives of BRI, excluding

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US from this initiative, and considering Chinese initiatives as a strategic competition. Aleck Chance also associates US pessimism towards this initiative to Beijing’s assertive behaviour in the South China Sea which prioritizes China’s national interests over other states’ interests which is in marked contrast with China’s claim of “win– win cooperation” in its initiatives such as BRI (Chance, 2016). These factors suggest that US perceptions of BRI are increasingly at odds with Chinese explanations which would create an atmosphere of mistrust in Sino–US relations.

Potential Opportunities and Challenges of BRI Most Chinese officials consider BRI as “an ambitious economic vision of the opening-up and cooperation”, “a systematic project”, “Silk Road Spirit” which aims to create “a community of shared interests, destiny and responsibility featuring mutual political trust, economic integration and cultural inclusiveness” (NDRC, 2015). Similarly, Wang Yiwei, professor of Renmin University notes that BRI will help to promote trade and investment, create economic free zones and vast Eurasian market which will influence economic world greatly and lead to the emergence of new political and economic order (Wang, 2019). Professor Jia Qingguo, the Associate Dean of the School of International Studies of Peking University takes a step further and notes that BRI as a new strategy creates an opportunity to promote economic enhancement, rebalancing, and cooperation and as a new measure which aims to foster regional prosperity and stability. He mentions that currently China pursues “a new way of opening” which inclines towards outward investments, technology and knowledge transfer policies (Jia, 2015). Notwithstanding such opportunities, there are some serious challenges that BRI may face in its implementation in member countries. Christopher K. Johnson believes that BRI would face with serious challenges, albeit it’s several advantageous. Since it may be “too hasty, too broad, too ambitious, and without sufficient preparations for unexpected contingencies” (Johnson, 2016, p. 20). Here I concentrate on the most serious challenges: terrorism and radicalism challenges, strategic challenges, proliferation of infrastructure initiatives, territorial and maritime disputes, operational challenges, legal and governmental challenges, and economic challenges. 1.

Terrorism and Radicalism Challenges

Terrorism, separatism and religious extremism are the factors that threaten the implementation of BRI (Liu, 2017). In fact, the existence of such tendencies would jeopardize national interests of China at home and the interests of Chinese firms in member countries of BRI. Most of these countries suffer from terrorism and insurgency which may influence China in a negative way (Ratner, 2018). For instance, SREB started from Xi’an, and passes through the western regions of China such as Xinjiang. 45% of the population of this region consists of Uighurs, compared to the 40% of Han

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people. The majority of Uighurs, who are Muslims and Turkic peoples, have separatist tendencies which could escalate the tensions in this region and impact the implementation of BRI (Bujak, 2016). Moreover, the rise of ISIS in the Middle East could pose a serious challenge to the BRI and safety of Chinese personnel who work there (Dong, 2014; Zhang, 2019). Thus ensuring the safety of Chinese projects and their labors in the Middle East under BRI is of prime importance for China. 2.

Strategic Challenges

At the strategic level, BRI arouses the concerns of China’s rival and neighbor countries such as US, Russia, India and Japan. One Chinese observer believes that these countries seek to counteract BRI and undermine Chinese initiatives (Wang, 2019). However, China has chosen to take amicable stance towards these countries and aims to connect BRI with some of the initiatives purported by abovementioned countries to depict its benign intentions. For instance, Russia considers BRI as a serious challenge to its Eurasian Economic Union (EEU), yet Xi Jinping’s visit to Moscow on May 2015, in which he stressed the connection of China’s SREB and Russia’s EEU, allayed Russia’s concern of losing its influence in the region especially the Central Asia (Small, 2018). Furthermore, critical sea lanes in the Indian Ocean, such as Strait of Hormuz, Strait of Malacca and Bab el-Mandeb Strait are strategically important for China. Thus maintaining the security of these sea routes, especially for the purpose of energy transportation, is critically important for China. The potential challenges that China may face in these checkpoints could be, US naval blockade of Strait of Malacca, the presence of pirate threat in the Bab el-Mandeb Strait and escalation of tensions in the nearby countries of Strait of Hormuz which could lead to its blockade (Liu, 2017). 3.

Proliferation of Infrastructure Initiatives

The existence of several infrastructure initiatives in Asia, such as India’s “Blue Economy” and “Act East Policies”, now called “Project Mausam”, Republic of Korea’s “Eurasia Initiative” and Japan’s “Partnership for Quality Infrastructure: Investment for Asia’s Future”, confuse most of the countries in the region and pose serious challenges for China’s BRI (Jetin, 2018). 4.

Territorial and Maritime Disputes

Territorial and maritime disputes in the BRI areas could impede the implementation of this initiative. On the ocean, “South China Maritime Sea dispute” between China and Southeast Asian countries, “Paracel Islands sovereignty” disputes between China and Vietnam, “Spratly Islands Sovereignty” disputes between China, Philippine and Vietnam, and disputes over Diaoyu Islands between China and Japan. On land, Kashmir dispute between Pakistan and India, Palestinian–Israeli dispute, Tajikistan and Uzbekistan disputes over their borders, and Fergana border disputes between Kyrgyzstan and Uzbekistan. All of these issues influence the progress of BRI both directly and indirectly (Liu, 2017).

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Operational Challenges

Scott Kennedy, Director of Project on Chinese Business and Political Economy in CSIS, notes that due to the inappropriate behavior of Chinese construction companies towards local workers in the recipient countries and their ineffectual operation of BRI projects, Chinese image could be denigrated in these host countries (Kennedy, 2015). Similarly, Hillman believes that Most of the BRI projects in the member countries are rarely delivered on time and usually the Chinese firms rely on Chinese labours rather than local workers which arouse the resentment of people in the aforementioned countries (Hillman, 2018). 6.

Legal and Governmental Challenges

China’s vast investments in many countries lead to the emergence of legal challenges. More than 60 countries with different legal systems such as “European continental legal system”, “Anglo-American legal system”, “Islamic legal system” represent major challenges to China which pursue “socialist legal system” (Wang, 2018). As for governmental challenges, Hillman points to the dichotomy of BRI visions and Chinese system of governing. In other words, the greater connectivity, which is the major goal of BRI, requires openness, exchange of ideas and knowledge and free commercial activities, the issues which are in contrast with China’s restricted governing system (Hillman, 2018). 7.

Economic Challenges

The presence of high-level credit risk in BRI and China’s difficulties in coordinating and dealing with numerous financial institutions and governments would be some of the challenges that could impede the progress of this initiative (Johnson, 2016). In this vein, Simeon Djankow considers Chinese financial institutions less experienced in comparison with their competitors such as the Asian Development Bank or European Bank for Reconstruction and Development. He concludes that China’s inability to identify and fund viable projects would pose serious challenges to its financial institutions (Djankov, 2016).

Chinese Perceptions of Indo-Pacific Strategy Chinese officials receive US IPS coldly and regard it with suspicion. They rarely make any detailed comments about it and tend to approach it skeptically. In this vein, China’s foreign minister Wang Yi implicitly criticizes confrontational policies of IPS that its member countries pursue (Zhao, 2018). Feng Zhang, adjunct professor at the National Institute for South China Sea Studies in China, believes that the majorities of Chinese authorities take a kind of nonchalant attitude towards US IPS (Zhang, 2019). For instance, in March 2018, Wang Yi compared the Indo-Pacific

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idea to “the sea foam in the Pacific or Indian Ocean” that “may get some attention but soon will dissipate” (China’s Ministry of Foreign Affairs, 2018). Even China’s, 2019 National Defense White Paper, which outlines basic goals and principles of China’s national defense system, avoids mentioning US IPS, and instead highlighted US role in escalating tension in the Asia–Pacific region through creating military alliance and increasing military intervention in the region which would merely add to the complexity of regional security. Dispelling the notion that China may be a threat to the stability in the region, the document considers Asia–Pacific countries as “members of a community with shared destiny”, a community in which China seeks to promote security and defense cooperation through “forging a constructive partnership of non-alliance and non-confrontation that targets no third party” (State Council of China, 2019). Unlike Chinese authorities who received IPS nonchalantly, Chinese scholars have expressed strong concerns about this strategy. In fact, their appraisals have been more explicit in casting IPS as a means of containing China which would lead to the escalation of tensions in the region. For instance, professor Zhang notes that US IPS seeks to create tensions in the region and increase US presence and arms sale in this region. Depicting China as a security threat, Donald Trump persuades the Asian countries to import US military equipment. Therefore, US not only contain the rise of China but also increase its revenue from arms exportation (Zhang, 2019). In November 2017, The Asian Post, considered President Trump’s new Indo-Pacific Strategy as “a direct contrast to Chinese dream”, and a leverage to encourage US allies in the region such as India, Japan, Australia and South Korea, to contain rising China (The Asean Post, 2017). Similarly, Dingding Chen considers Indo-Pacific Strategy as a response to China’s rise, and an attempt to reshape alliance system in the region. In this regard, the majority of Chinese scholars believe that China’s rise and its consequential geopolitical changes lead to the emergence of Donald Trump’s Indo-Pacific strategy which aims to “hedge against China’s foreign and security policy behavior” (Chen, 2018). The revival of Quadrilateral Security Dialogue, and specific role of India in IndoPacific strategy, have been of great concern for Chinese scholars (Wuthnow, 2019). In other words, Washington resorts to these two elements in order to contain rising China. Firstly, US enlisted the help of India, Japan and Australia under the framework of IPS in order to establish strategic strongholds in the East, West and South of IndoPacific region, and thereby checking and balancing the rising influence of China, and secondly, US pins its hope on India’s “strategic advantage in the East Indian Ocean” to “to squeeze China’s strategic space” (Zhu, 2019, p. 11). Moreover, depicting US IPS as an alternative to China’s BRI is also giving a serious cause for concern. In 2018 US Secretary of State, Mike Pompeo mentioned that US allocated USD 113 million fund to support Indo-Pacific Strategy in the areas of development and economic prosperity. He further stressed its major goals which focus on “transparency, anti-corruption, and responsible financing” and asked IndoPacific leaders to prioritize these issues in their policies (Pompeo, 2018). It seems that he indirectly criticize China’s BRI which sought to pursue the same policies and goals. At the Detroit Economic Club, Pompeo contrasted American model with

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Chinese model, and stated that global economy should follow American model. In response, Zhang Jiadong, professor of International Studies, at Fudan University repudiates this position and mentions that the two models have their own unique characterizations which have been successful in their own countries. In addition, Zhang believes that there is no competition between American model and Chinese one. While US “believes that its political system is universal, so it has the impulse and obligation to expand”, China considers its model exclusively Chinese, “so there is no need or possibility for the expansion of ideology” (Zhang, 2018a). In this vein, Pang Zhongying, the director of Centre for the Study of Global Governance at Renmin University, believes that the new economic vision of US-FOIP is a direct response to China’s BRI and would complicate Sino–US relations (Pang, 2018). South China Morning Post, also considers US Indo-Pacific economic vision as a response to China’s BRI (Storey & Cook, 2018). Wang Peng, associate research fellow at the Chongyang Institute for Financial Studies notes that while FOIP aims to create “an alliance system” to contain “China’s growing global influence”, BRI seeks to create “a platform for mutual exchanges and learning between civilizations” (Wang, 2019).

Potential Opportunities and Challenges of IPS US IPS would provide American companies an opportunity to have access to the huge markets of Indo-Pacific region. Moreover, this strategy seeks to enhance “Digital Connectivity and Cyber-security Partnership”, “Development and Growth through Energy”, and “infrastructure” in the region (Pompeo, 2018). However, IPS faces some challenges which would influence its successful implementation in the future. First of all, lack of harmony and trust between its member countries, especially the Quad members, overshadow the success of this strategy. In this vein, William Choong, senior fellow at International Institute for Strategic Studies, believes that Quad members do not have a coherent definition and conceptualization of IPS which does not augur well for the future of this strategy in the region (Choong, 2019). In fact, the driving factors for these countries in order to establish a unified coalition under IPS are not to solve common regional issues but their own domestic and international issues (Xiao, 2014). Secondly, Donald Trump’s recent withdrawal from Trans-Pacific Partnership (TPP) and his pressure on Asian countries to bear all the defense costs cast doubt on US long-lasting commitments to ensure security in the Asia–Pacific region. Therefore, IPS would face some uncertainty about realizing its economic and strategic goals. In this vein, Ye Hailin, the Director of the Center for International Strategic Studies of the Research Institute for Indian Ocean Economies (RIIO), notes that IPS which seeks to strengthen strategic cooperation among Quad members would adversely influence security environment around China. However, due to the existence of some strategic limitations, lack of consensus over maintaining stable collaboration in order to meet strategic demands of Quad members, it is uncertain that whether IPS would achieve its strategic results or not (Ye, 2019). And thirdly,

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considering IPS as a tool of containing China would pose a difficult dilemma for the countries in the region to choose between US and China, and consequently escalate tensions in the Indo-Pacific region (Pitlo III, 2018). Hence, the regional countries are reluctant to choose sides in the great power competition in the region. Since they depend strategically on US and at the same time have deep economic ties with the China.

Growing Strategic Competition in Sino–US Relation Since the inception of BRI and IPS, geopolitical and power competition have been intensified in the Sino–US trajectory. The Trump administration’s China policy mainly focuses on major power competition. 2019 Indo-Pacific Strategy report, 2017 National Security Strategy and 2018 National Defense Strategy documents depict China as a “strategic competitor” and a “revisionist power”. In addition, Matt Pottinger, senior director for Asian affairs on the American National Security Council, notes that Trump’s administration seeks to update its China policy in order to “bring the concept of competition to the forefront” (The Economist, 2018). Elizabeth Economy also contends that US–China relations, under President Trump, have entered a new era in which “ conflict and competition” are dominant elements that could complicate their future bilateral ties (Economy, 2019). Rather than establishing constructive relations with China, he imposes several tariffs on Chinese goods and adopts tough stance toward Beijing, such as increasing “competition in trade for high-tech industries”, which would merely escalate tensions between the two nations and even jeopardize Sino–US relations (ISDP, 2018; Wu, 2018). In response to IPS, Ling Shengli, secretary-general of the International Security Study Center at China Foreign Affairs University, notes that if US sought to contain China through its IPS, it would “inevitably intensify bilateral strategic competition, harm regional peace and development, and lose support from most countries in the region” (Global Times, 2019). Similarly, Jia Xiudong, senior fellow at China Institute of International Studies (CIIS) points to the “Janus-faced” nature of US IPS, which take anti-China stances, although US authorities contend that it promotes notions and principles that are to the benefit of the states in the region, including China, and highlight this issue that Washington does not seek to force any country to “choose between the United States and China” (Jia, 2018a). In response to BRI, Chinese reluctance to include US and lack of transparency in explaining underlying motivations behind BRI, make US authorities to receive this initiative suspiciously. Therefore, it seems that anti-China and anti-US sentiments behind IPS and BRI would inevitably increase mutual distrust between US and China.

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Conclusion Juxtaposing US IPS and China’s BRI, this study offers an opportunity to identify the divergent and convergent areas in Sino–US trajectory and thereby shedding light on their deep strategic distrust. Since Donald Trump assumed power, his zero-sum approaches against Beijing jeopardize bilateral relations between the two states and it is very likely that his unilateral and ‘America first’ policies send US–China ties into a tailspin. While American scholars and authorities consider BRI as a threat to US interests, their Chinese counterparts are not sanguine about US IPS which essentially seeks to isolate Beijing in its own backyard and thereby contain the growth of China. Considering the existence of such rivalry mentality among Chinese and US authorities, it is likely that Indo-Pacific region would become the arena of US– China strategic competition. However, the regional countries are reluctant to choose sides in the great power competition in the region. Since they depend strategically on US and at the same time have deep economic ties with China. Resorting to IPS and BRI to counter or counterbalance each other in the Indo-Pacific region, US and China would merely complicate their constructive relation and jeopardize stability and security in the region. Both US and China should cooperate with each other in order to promote global prosperity and peace while averting excessive tensions and mutual hostility. Perceiving BRI and IPS as the tools of marginalizing US and China’s strategic influences especially in the Indo-Pacific region would not only prevent both sides from realizing their strategic and long-term goals, but also denigrate US and China’s images in the international communities who carry special burden of responsibility in dealing with global issues. US and China need to formulate better responses to BRI and IPS, respectively, and identify the convergent and divergent areas in order to manage competitive aspects in their relations.

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Behzad Abdollahpour graduated from the Faculty of World Studies, University of Tehran, Iran and is currently an independent researcher and an international book reviewer whose reviews are published in many prestigious and academic publications including Oxford University Press, Cambridge University Press, Sage, Wiley, and Taylor & Francis Group. His research interests include Sino- US foreign policy, China’s Belt and Road Initiative, comparative politics, Cultural ties between Iran and China, and China’s role in international arena.