Hambantota

China moves to turn Iran into a client-state; stakes up for India

(This is a reprint from NewsBred).

India would watch with concern a blood-pact in the making between China and Iran which could mean trouble both at home and abroad.

China put an agreement in place last month which would virtually turn Iran into a vessel state. Tehran is already in bed in wild anticipation, once its parliament approves the union.

The 18-page agreement, accessed by the New York Times, involves 100 projects worth a staggering $400 billion. China would get discounted oil for next 25 years and in exchange would pepper the Persia of old with subways, high-speed railways and airports. There would be free-trade zones in strategic locations, including two which would overlook the critical Persian Gulf (Abadan) and the Strait of Hormuz (Qeshm).

Iran plans to hand over Jask, a port just outside the Strait of Hormuz, to China which is the vantage point through which most of the world’s oil transits. India, which imports 84% of its oil, has reduced its dependence on Middle East in recent years but it still accounts for 65 per cent of its needs. Saudi Arabia and Iraq are two of its biggest oil suppliers from the Middle East.

China has a string of ports in Indian Ocean, such as Hambantota in Sri Lanka and Gwadar in Pakistan, and now soon in Jask, which puts New Delhi at unease on its energy and security needs, if China was to block the free seas and give these ports a military makeover.

It also messes up the Chabahar port on the Gulf of Oman which India has helped build and now controls since 2018. India had soaring ambitions of turning this base into access to Central Asia and much of Eurasian landmass, through a mix of sea-land routes, not to say oil pipelines, bypassing the physical barrier of Pakistan on its north-western borders (see image).

Now India is hemmed in on its north and west flanks by two enemies and in between are the impassable Himalayas. It would be increasingly reliant on the military muscle of the United States for its freer access to seas upwards.

The United States would be no less alarmed by China’s move on Iran. It had sought-and controlled—the Middle East for decades since the World War II. Now its Fifth Fleet, based in Bahrain in the Persian Gulf, could face China’s build-up. Its warships have regularly tangled with Iranian fleets in the busy sea lanes of the Persian Gulf.

The proposed deal also makes a nonsense of the United States sanctions against Iran under the Trump administration, which had brought Tehran on its knees with crippled oil supply and blocked access to world’s financial highways. China, it seems, has braced itself too for the US economic sanctions which are inevitable in the wake of this agreement and would intensify the trade or covert war between two of world’s biggest powers.

Iran needs to produce—and supply—at least 8.5 million barrels a day in order to be relevant in the energy sector. China seeks to import at least 10 million barrels a day for its energy needs. It imports 75 percent of its oil from foreign oilfields.

The agreement also outlines China’s plan to help Iran build its 5G telecommunications network, riding on its major player Huawei. The Trump administration has barred Huawei from the United States and India is set to do the same under prime minister Narendra Modi.

The Shia Factor

India’s ties with Iran have plummeted in recent months. The Iranian foreign minister Javad Zarif had made inflammatory remarks on the CAA and on Delhi riots in February for which it was rebuked by the Modi government. India has the second highest number of Shias in the world after Iran. India’s Shias have been a moderating influence on a virulent Muslim section in India.

The document also outlines military cooperation, joint training, exercises and research besides intelligence sharing and manufacturing weapons. The military ties between China and Iran have only scaled up in recent years. The Chinese navy has participated in military exercises in Iranian waters at least three times since 2014.

Then there is the Russia factor. Moscow is India’s biggest defence importer but if asked to make a choice, it would look after China’s back than of India. It is India’s oldest and most reliable friend but the ties now are facing its litmus test. The clincher would be the supply of S400 missile system in 2021 which India is committed to buy and the United States is determined to prevent. It would be a make or break moment for India-Russia ties, at least in the immediate future.

The second Cold War is unfolding. In its first version, the United States and Soviet Union were ranged against each after World War II, in the battle-lines drawn by the NATO and the Warsaw Pact in the European theatre, their respective allies in the neighbourhood of Central-Latin America and Eastern Europe-Central Asia visible in plain view. The contours of the second Cold War is no less apparent. The United States and China are snarling at each other, with Indo-Pacific and the Middle East the two most likely flashpoints. The stand-alone moment for India is gone.

 

 

 

India thumbs nose at China

This is a reprint from Newsbred.

In the first part of this series, we looked at Japan and India raising hackles against China in East and South China Sea. In this second and concluding part, we look at reasons for India’s militaristic posturing and its’ likely fallout.

 

One and a half years into his premiership, Modi seems swamped by issues which certainly are not of his making but would need at least 10 years of his helmsman-ship.

In an impatient country, rogue opposition parties stall him at every step and scoundrels in media bay for his blood every morning. Modi knows immediate issues could sail or nail him, given how they turn out.

Modi’s most pressing concerns—which probably are true of any other country—is improving jobs, infrastructure and Human Development Index (HDI) to go with a secure neighbourhood.

Creating jobs is a millstone around his neck.  India needs 12 million jobs for its youth every year—that is more than the population of a Greece or Hungary. The infrastructure “deficit” is estimated to be over $750 billion—that’s more than twice the size of Singapore’s economy. The HDI ratings are 135 out of 187 nations, conveying a yawning shortfall in areas such as education, health or gender inequality. Agriculture and rural-urban divide is monstrous. Intended legal or economic reforms are hacked by butchers occupying opposition benches in the parliament.

Modi’s best hope in this has been to seek a huge foreign investment.  He chiefly has sought out US, Japan and China in this quest. United States has been quick on the cue. There is now a five-fold increase in India-US trade. US supports India’s bid for a United Nation’s Security Council (UNSC) seat. Joint production of weapons and weapon systems has been agreed upon.

US’ interests are evident. It wants India as a frontline state in its bid for strategic naval dominance in Pacific and Indian Ocean. Pakistan’s National Security Advisor Sartaj Aziz pulled no punches when he declared in September that “America is preparing India to reduce the influence of China in the region.” Japan, as we’ve found out, has been quick to do the bidding on US’ behalf for India.

China, on the other hand, has an indifference bordering on contempt. Chinese President Xi Jinping came with much fanfare to India last year but offered only 20 billion dollars of Chinese investment over five years—that too was a quantum jump on existing Chinese investment of only $500 million in India. It’ ‘investment even in Myanmar totals $14.2 billion.  Before Xi could even settle down in Beijing on return, China’s incursions in India’s northeast borders had left a bitter taste in its hosts’ mouth.

In June this year, India was stunned when China vetoed an Indian attempt to pressure Pakistan into keep the alleged 26/11 Mumbai attacks mastermind, Zakiur Rehman Lakhvi of Lashkar-e-Taiba (LeT), into jail. This wasn’t the first time though. China had thrice before blocked efforts to designate Jammat-ud-Dawa (JuD) as a terrorist organization. It was LeT which had attacked the Indian consulate in Herat, Afghanistan last year on the eve of Modi’s inauguration. It’s also worth remembering that China was critical in arming Pakistan with nuclear weapons’ knowhow.

China’s support to Pakistan indeed has been extraordinary. It’s commitment to invest $46 billion in the construction of the China-Pakistan Economic Corridor (CPEC), to connect Kashgar in Xinjiang to Gwadar port on the Arabian Sea, is staggering. It’s the largest investment project ever in one country, bigger than even the US Marshall Plan after World War II.

If it bears to fruition, the CPEC with its power projects, fibre optic links, roads and energy supplies will transform Pakistan’s economy. Pakistan has even created a special division of 10,000 in its army for the defence of the project as it runs through the troublesome Balochistan province. A part of this project runs through the Pakistan Occupied Kashmir (PoK), much to India’s annoyance.

Sure, Pakistan is important to China. It doesn’t want the terrorist trouble to spill into its Tibet and Xinjiang province. Pakistan also is its staunch ally in the Islamic world. Above all, Pakistan sits at the intersection of South Asia, Central Asia and Middle East.

Thus India, on its own part, feels encircled. China has extended its reach in the Indian Ocean through Sri Lanka and Maldives. Gwadar is said to be a pearl in its crown though there is a misnomer here which must be spelt out in full.

Pakistan purchased the small town of Gwadar from Oman in 1958. However, work on its port began only in 2002. Its need arose as repeatedly Pakistan found its naval and strategic options limited in conflicts with Indian Navy who were quick to blockade Karachi. Gwadar happens to be less than 500 km from Karachi and thus an ideal alternative.  At Pakistan’s request, China provided US $198 million for the first phase which was completed in 2006. Thereafter, China took little initiative in completing its remaining two phases.

Gwadar’s importance clearly is being overplayed by the analysts. First, for it to be an effective port, China would need to built thousands of kilometers of roads in Pakistan. So is true of thousands of kilometers of gas and oil pipelines; and railway tracks to justify the investment in Gwadar.

Besides Gwadar isn’t the only option for China in Indian Ocean. It has Hambantota port in Sri Lanka and a container port in Chittagong in Bangaldesh. China has built roads, dams and pipelines in Myanmar, not to say developed port in Kyaukpyu. China’s oil ships from the Middle East and Africa will cross the Bay of Bengal and unload at these ports.

Still, India has sulked at China’s indifference. In China’s latest white paper on defense, India doesn’t figure at all.  India’s insecurity has been further heightened by China’s astonishing military build-up.

Border is another issue. India wants to clarify the Line of Actual Control (LAC). India’s navy has counted 22 “encounters” with Chinese submarines in Indian Ocean in a span of 12 months. China’s defense budget has shown a three and a half fold increase in just last decade. Its’ air force is twice the size of India.

According to a news report, Beijing needs only two days to mobilize on the Chinese-Indian border while New Delhi, hampered by its crippling transport infrastructure would need at least a week to do so. China, if it wants, could place 450,000 troops in a jiffy at the border, three times to what India could manage.

Chinese navy warships have been spotted on long deployments just off India’s coasts. India’s present chief of navy staff, Admiral Robin Dhowan couldn’t help but publicly say that India is “minutely monitoring” Chinese maritime movements.

Sure, India has caused distrust of its own. It hosts Dalai Lama which is a sensitive subject for China. If India wants to stir up things for China in Tibet, the latter wouldn’t mind using Pakistan for the same end. India also views China as a major opponent in seeking oil and other resources from Africa. Last month Modi hosted a summit of African government leaders in India’s capital.

Given India’s needs, it certainly doesn’t want to be leashed in its own region by China’s tactics. It’s association with Japan would certainly make China a little more sensitive to its anxiety. In the real-politic sense too, India has been clever to make the most of differences between Japan and China.

The only concern, and it’s a real one, is if US or Japan go too far in needling China in East or South China Sea. If gloves are off, India would be required to fulfill its obligation or the promised investments would go up in smoke. Modi’s best bet is it won’t happen in next three years and by that time he would have secured his re-election.