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East Asia

The Asian Square Dance – Part VIII

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The economy

Economists generally agree that the cumulative economies of China and India will be larger than that of the G7 by 2030. At present, China’s GCP stands at $9.2 trillion, or nearly 5 times that India.

The two countries have taken very different economic paths. China has chosen to become an exporter of labor-intensive products while India still relies on agriculture and services, particularly in IT.

Russia’s GDP at $2 trillion in 2013, and expected to shrink by 3 to 5% in 2015, less than a quarter of China’s. Russia is a raw material powerhouse and a manufacturing dwarf. As such it should be a natural supplier of oil and gas to China – it is a closer supplier than the Middle East. However, the pipeline that will be built across Siberia will deliver its goods to Nakhodka, a port facing Japan. Russia seems to fear that it will become dependent on China for its gas exports and that China will consider Russia as a vassal state and sideline it on the international scene as the disparities between the two countries grow. China has also to date not given a definite reply to the role Russian gas will play in its energy policy. Price is also an issue since China tends to compare the price of gas with that of domestic coal.

While economists forecast that China’s GDP will overtake that of the US, it still has some way to go as US GDP stands at $15 trillion.

By building its extremely large dollar reserves, $4 trillion, the Chinese Central Bank has allowed the US to borrow at very low interest rtes and has created a situation in which banks have searched for higher yields through lending massively to the housing market. The risk on the currency and on the value of US Treasury paper is extremely large. It is estimated that China holds over 6% of the US debt.

China could, if it so wished, put pressure on the US economic system by buying less US debt, or even selling it, thus precipitating a fall in the dollar and an increase in interest rates. Reprisals from the US could come in the form of new barriers to trade for products made in China.

Should there be a major economic recession in the US, with a consequent loss of jobs, the country may well turn to protectionism. The idea that the globalization process has been essentially beneficial to China will be a driver to reduce imports from that country.

China is also worried that US government borrowing to cover its enormous deficit will lead to high inflation and that therefore the bonds held by the Central bank will lose value.

The US has been putting considerable pressure for China to revalue its currency, the RMB, and thus reduce its competitive advantage based on cheap labor. Some economists, however, believe that a revaluation of the currency may well lead to precisely the opposite effect as funds may then float out of the RMB and into other currencies, thus leading to a de facto devaluation.

The fall of the dollar has revaluated the RMB and thus made Chinese exports more expensive, hurting mostly privately-owned SMEs and halting the modernization process of the economy. The US could allow its currency to depreciate further, to the point where its goods would be significantly more competitive than they are today.

China could take advantage of a weaker dollar to acquire assets denominated in dollars, whether in the US or in other countries. It has thus become a major lender and investor in South America – particularly in Ecuador, Nicaragua and Venezuela where it has committed to invest $250 billion over the next 10 years. This might well be the reason for the US to have softened its stance towards Cuba.

China could also use its reserves to acquire major European corporations in the hope that they will out-compete US companies thus creating an economic war between the US and the EU. It could also use its vast financial reserves to hoard oil and uranium forcing prices of these products to reach new highs.

China feels that the US administration under President Obama has not delivered on its pledge of including China, and other emerging countries, into major economic decisions. Thus, the Obama administration has put pressure on its allies in the Asia-Pacific area to stay away from the Asia Infrastructure Investment Bank, one of China’s pet projects.

As of Japan’s GDP at $5 trillion stands also at four times that of South Korea.

Trade and investment

Asia is in a unique tradition with several world powers sitting on a nuclear arsenal and harboring resentments and old, deep rooted hatreds and territorial disputes. Military budgets are on the rise and economic growth has slowed considerably. Competition exists between the countries we have been considering in this series of articles – it exists in the industrial world, in cyberspace and in outer space.

Asia’s history is one of constant conflicts and long-seated hatred and there are too many potential conflicts that threaten to erupt into wars. There is also a seeming disdain of leaders towards their own people, the most flagrant case being North Korea.

There is also a major gender imbalance in favor of men and this situation has led to fears of a rise in militarism. There is contradictory evidence that unmarried men tend to be more violence-prone than married man.

Almost all the countries covered have strong economic interconnections.

India runs a major trade deficit with China which in 2013 was of over $ 30 billion, with India complaining that Chinese goods take advantage of a whole series of measures put in place by the Chinese government while Indian companies have problems entering the market.

Similarly, Indian companies have had problems entering the Japanese market, but due to quality issues.

With the opening of the Indian economy to foreign investments, Japanese corporations, catching up to a late start, are expected to invest $35 billion over the next 5 years in public-private partnerships. Japan is also expected to become a partner in a major public-private infrastructure partnership project, so large many knowledgeable observers of Indian politics doubt it can be realized, estimated at $100 billion, to create a high technology corridor – the Delhi Metro Industrial Corridor – linking Mumbai to New Delhi. Terrorist attacks have so far frightened would-be investors, however.

China has also been an important investor in India. A sustained economic cooperation between the two countries would make them less dependent on exports to the European Union and to the US.

China has regularly complained about the long delays for India to approve investments by Chinese firms and of a total ban in investments in infrastructure. Chinese workers also have difficulties in obtaining working visas.

Bilateral trade between India and Russia is much lower at $12 billion but after President Putin’s visit, ambitious targets have been set for 2030, essentially in infrastructure projects. Thus, Russia will supply four nuclear power plants.

India’s largest market is the US with bilateral trade between the two countries being of the order of $100 billion with plans to reach $500 billion. The US has thus displaced China as India’s largest trading partner in spite of India’s complaint that US subsidies to cotton farmers undermine Indian exports and that steel exports are unjustly submitted to high tariffs. In turn, the US complains at the difficulties companies face in attempting to enter the Indian market and at the limitations imposed on them when investing.

China and Japan are each other’s largest trade partners, China having replaced the US in that role. Japanese tourists are the main visitors to China. Japan is the major foreign investor in China, taking advantage of low labor costs. However, the tense situation between the two countries, and the increased cost of manpower, has led Japanese companies to sharply reduce their investments.

China is also South Korea’s main trading partner with two-way trade of $230 billion and the signing of a bilateral trade agreement that took effect in February of this year. Koreans are also large investors in China.

China and Russia, in spite of the fact that they are both export-oriented economies, are complementary in that the first is a big consumer of raw materials, primarily energy, while Russia is a major exporter of oil and gas. This has led China to increasingly see Russia as a petro-state with little technological capabilities and unable to pose any type of threat.

Hence, while in the years following the Second World War Russia saw itself dwarfed by the Western economies, the country is, today, overtaken economically by both the West and the East, the latter being represented by China, Japan and South Korea.

In the Chinese-Russian partnership, China appears to be the senior partner and it is safe to say that Russia needs China more than China needs Russia.

Russia sees China as a hedge of its European energy markets. This hedge, however, can only be fully operational in the future as building the right infrastructure that would allow Russia to move its energy exports eastwards is a long-term venture, particularly since Russia’s most productive wells are in the European part of the country while the bulk of China’s population is in the eastern part of their own country.

Two-way trade in 2014 was over $100 billion and while China is Russia’s second largest trading partner, trade with the EU is 4 times that amount. The value of trade is very dependent on the price of oil and gas. It is nevertheless expected to reach $200 billion by 2020.

On completion of the Eastern Siberian Pacific Ocean Oil Pipeline (ESPO), Russia could supply 20% of China’s imports and 33% of Japan’s on condition these two countries choose this dependency.

The two countries have launched the world’s largest joint gas project – the Sila Sibiri pipeline – which will deliver gas to the Russian Far East and to China. There are other joint projects, including in the Arctic, which have received President Putin’s blessing.

Since 2014 commercial contracts between the two countries intensified as Russia was looking for credit and investors in the face of the sanctions imposed by the EU and the US as well as the serious dip in the price of oil. The oil and gas contracts signed between the two countries are, respectively, of $270 and $400 billion over a thirty-year period with Gazprom deliveries due to start in 2019.

Chinese investments in Russia are of the order of $10 billion and new investments have been earmarked for a large variety of projects. The largest investment is a partnership with Rosneft, valued at several billion dollars meant essentially for the Sakhalin-3 block. Rosneft has also secured a $35 billion loan from China in exchange for oil supplies. This envelope is to be used to purchase several smaller oil producers.

China will also invest in a high-speed train between Kazan and Moscow – a $25 billion investment, and other major infrastructure projects are being discussed.

Russia has, in turn, agreed to supply China with the know-how to produce uranium-enrichment facilities and to supply enriched uranium.

Economic ties between China and the US are also important and the interdependence between them appears to be growing rather than slowing in spite of constant mutual accusations of retreating from free trade. The US ran in 2013 a deficit of $318 billion for merchandise trade, one third of the total trade deficit. China is the US’ biggest supplier.

Imports by the US of cheap Chinese products – essentially manufactured goods, machinery, chemicals and transport products – has been of great assistance in controlling inflation and the US has thus transferred to China increasingly large amounts of dollars. Since China is a major supplier of goods to other Asian countries, in particular in South-East Asia, that assemble products for export to the US, the US’ importance to the Chinese economy is even greater than what the above figures show. The US has started a large number of cases against China at the WTO claiming the country is practicing illegally high import tariffs on US goods while simultaneously subsidizing exports. By limiting or banning exports of raw materials, such as bauxite, and allowing prices to climb, China has been accused of developing one more strategy of subsidizing its industry.

Chinese investments in the US are of the order of $50 billion but are dwarfed by the over $400 billion invested by US corporations in China, even though the investment flow has slowed. Statistics in this respect are not meaningful, as often these investments are not reported in US statistics as the flow of funds is channeled through favorable tax havens.

A large number of American firms have established manufacturing facilities in China, and this allowed the US economy to grow with minimal inflation. There is a generally shared belief that China has entered a period of uncertainty, that local competition is adopting a more aggressive stance that in some areas there is over-capacity, that intellectual property is not respected and that the country is increasingly adopting a protectionist stance. Nevertheless, an increasing number of US corporations are dependent on the Chinese economy for their profits and sometimes on products, such as tobacco, whose sales are dwindling in traditional markets.

Also, the US is attempting to sell, in China, alternative energy sources such as solar or wind power technology. This is a major market considering that the Chinese government has announced its intention of investing $200 billion in renewable energies by 2020. US companies, however, are loath to export their latest technology in a country known for closing an eye to the trespassing of intellectual property.

Chinese investments in the US could be even bigger if they were not met by obstacles – the most glaring example being that of Huawei, the telecommunications company, which was blocked from entering the US market.

The Chinese have also become very large buyers of real estate in the US, amassing a portfolio of $22 billion.

The relationship between Japan and Russia is more complex since the two countries have never signed a final peace agreement and Japan still lays claim on the Kurile Islands. Russia is ill at ease with Japan’s future involvement in a missile defense system and has proposed to join the initiative which is led by the US.

Bilateral trade is of the order of $33 billion with oil and LNG taken an important part of this volume, in particular from the Sakhalin deposits. After the Fukushima incident Japan has felt the need to diversity its sources of energy and Russia is a natural supplier. In Russia’s eyes, supplying Japan would counterbalance the increasing dependence on China. Several cooperation agreements to develop new gas and oil fields have also been signed between the two countries.

Total Japanese investments are small, with car makers have plants in Russia, but the most likely investments will target Russia’s Far East, particularly for infrastructures. Several joint ventures have been started in agriculture, energy and infrastructure.

Japan and South Korea are each other’s fourth largest trading partners. Russia has proposed building a railway that would link North and South Korea to the European markets via Russian territory – i.e. connecting to the Trans-Siberian Railway. Such an undertaking would allow South Korea to increase trade with Europe and reduce its dependency on the American and Asian markets.

Bilateral trade between South Korea and the US amounted to $115 billion in 2014 and represented a US deficit of $25 billion. In June 2007, the two countries signed a trade agreement that phases out all tariffs, on consumer and industrial products over a period of three years. Total investments from South Korea to the US is estimated to be $25 billion while US investments in South Korea are of $35 billion.

Bilateral trade between the US and Russia was, in 2014, of $34 billion with a US deficit of $13 billion. Russians are big investors in New York – particularly Manhattan – real estate particularly since the sanctions and the decrease in the price of oil led to a collapse of the ruble. US investments in Russia stand at around $15 billion and are rather diminishing, again in view of the sanctions.

Economic growth has not eradicated poverty in East Asia and estimates of the extremely poor are of the order of 250 million persons. Although continuing economic growth should lead to a reduction in poverty, this should still touch 15 to 17% of the population. The imbalance stems in part by the fact that there is an imbalance between skilled and unskilled labor as well as regional imbalances due to the rapid industrialization of certain areas.

Demography

East Asia is today’s the world’s fastest aging. Projections show 20% of the population over 60 by 2050, or two-thirds of the world’s seniors. Already by 2040, the number of people over 60 will be higher than the people under 15.

Just as China is the world’s most populated country, India is the world’s largest democracy. They are the only two countries with a population larger than 1 billion. It is forecast that sometime between 2015 and 2025, India’s population will have overtaken China’s as the former’s population is growing at twice the rate of China’s population. Furthermore, India’s population has a low average age while China’s is aging. Therefore while India may be considered to have an infinite supply of cheap labor, this will not be the case of China in the mid-term future. Thus, while India’s dependency ratio will improve, China’s will worsen.

China’s population is aging rapidly, partly because of a vastly improved health system. This expanding health care system will require substantial additional funding. So will the pension system even though traditionally, children support their elderly parents.

Both China and India suffer from a growing ratio of males to females. The devotion of the children to their parents, when these age, will be difficult to maintain if single men, due to absence of the brides, migrate in search of employment of opportunities.

As the economies of both countries expand at a similar rate, they will need trained engineers and scientists. China graduates 600 000 engineers per year and India 350 000. However, China has a qualitative advantage due to a better educational system.

Japan’s economy is to a large extent driven by demographic change. Birthrates have collapsed with a total fertility rate dangerously approaching 1. With a life expectancy of 88 years, it has today the world’s oldest population, with the largest number of centenarians, but may well cede this place to China by 2050. By 2025 its population over 80 years of age will be equal to that under 15. Thus, two persons of working age will have to support one retiree. On the other hand, they will be a reduction in supporting children.

Older persons invest very conservatively, and therefore the economy might lack the dynamic financial markets required to fuel growth and entrepreneurship.

To a large extent, the same analysis applies to South Korea. North Korea is faring slightly better with a total fertility rate of nearly 2.

Russia has a population of 142 million for a country representing 19% of immerged land. There has been a small rebound in birth rates, but it may not be sustainable. The percentage of the population over 60 is low compared to China, Japan and South Korea, and is of only 20%. The imbalance between women and men – 1 160 women for 1 000 men – and the fact that women in rural areas are unable to find husbands who are not addicted to alcohol, contribute to a low level of marriages, and consequently low fertility. With life expectancy expected to rise in the coming years, while fertility is expected to remain at its present level, the old-age dependency ratio is expected to double by 2050. This would mean that spending on allowances and pensions would rise from the present figure of 9% to 12% by 2030 and 16% by 2050.

The situation in the US, while not as bad, is worrying. Its population of 316 million is growing at the rate of 0.7% and is expected to reach 400 million by 2050. 22% of the population will be over 65. The life expectancy is slightly higher than 78 years but the total fertility rate at 1.9% is below replacement. The reduction in birth rate applies also to immigrants, usually an important component in US demographics.

India’s demographics are quite different. Its population is only slightly below that of China, at nearly 1.3 billion, and it has the world’s largest number of young people since two thirds of its population is under 35, and the average age of the population is 27. But in India too the population is aging and is expected to reach 37 by 2050. At that time 300 million people with be over 60. The total fertility rate is 2.5. It should therefore still enjoy a demographic dividend compared to the ageing societies we have reviewed.

The Diasporas

There is a large Tibetan diaspora in India where the Dalai Lama has established his headquarters and this has been an irritant to the Chinese government while achieving little for the Tibetans. The Dalai Lama relinquished his political responsibilities in March 2014 and has been replaced by a Harvard scholar who has never visited Tibet

The presence of a Chinese diaspora in Russia is a more complex issue as there is an important labor movement, of legal and illegal immigrants, along the border and is becoming an important issue in the relations between the two countries. Migrant labor is essentially employed in agriculture and construction. The total number of Chinese in Russia is estimated to be 400 000 including nearly 20 000 Chinese students in Russian universities. The vast majority of the migrants come to make money and have no plans to settle permanently.

The Chinese diaspora in the United States is much larger with 1.6 million immigrants and just as many US citizens of Chinese origin, heavily concentrated in the states of California and New York. Several incidents have questioned the loyalty of some of the immigrants to the host country.

There is a small but concentrated Korean diaspora in China numbering approximately 600000.

There has been a considerable flow of highly qualified and entrepreneurial migrants from India to the US and the Indian diaspora amounts to 2.5 million people and this number is expected to double in the next ten years. Indians are thus the most important group of Asian immigrants in the US. The 75 000 Indian students in the US are the largest foreign group registered in colleges and universities. Indian immigrants have been, on the whole, an extremely educated and successful group with total assets estimated to total $76 billion.

There are in the US over 3 million Americans of Russian descent.

Water

There is a contentious issue between China and India regarding the latter’s water diversion plan which will shift 50 billion cubic meters of water from the Yarlung-Tsangpo, an affluent of the Brahmaputra originating on the Tibetan plateau, to the Yellow River so as to harness hydroelectric energy. This would severely restrict the flow of water to India.

Energy

As mentioned in the first part of this article, China and India, but also China and Japan, are competing to secure energy sources.

While the competition between China and India lies in securing energy sources in other countries, that with Japan is not only centred around Russian supplies, but also on the presumed hydrocarbon deposits around two rocky uninhabited islands in the East China Sea that the Japanese government purchased from a private owner and which China claims as its own.

China is uncomfortable with the long shipping route oil takes from the Middle East to its ports. The area is populated by pirates and other revolutionary or semi-revolutionary movements that could be allowed, if not encouraged, to target Chinese vessels. Ensuring the safety of the shipping routes is the official reason for China’s investments in naval power.

Central Asia

Russia fears the political influence that China may exert on the Central Asian republics, in particular through the SCO – the Shanghai Cooperation Organization – set up by China but pf which Russia is also a member. India is, incidentally, an observer, and Russia would like to invite the country to full membership status. Intriguingly, however, while Russia sees to remain the determining factor in influencing policy in Central Asia, China’s position is that these states are free to develop relations with countries not members of the SCO and that the organization is not, and should not, become an anti-Western club.

Russia opposes China’s wish of extending the SCO agreement to cover trade in the form of a free trade agreement, as Russian corporations would be unable to compete on price. It would also open the area to Chinese investments, including in energy projects. China is successful in the region due to the aid it brings, diplomatic pressure and large investments. Russia’s policy has been to prevent Central Asian countries to supply European markets by bypassing the Russian pipeline system and ensuring it has a monopsony. However, in view of the decreased quantities purchased by Russia affected by the reduced demand in Europe, these countries have looked for alternative markets, and China is the obvious one.

Russia would like to see a coordination of pricing policy on energy exports between the member countries that are energy exporters.

Another Chinese advantage is that it is perceived by Central Asian governments as a trading partner and a door to Europe and the Middle East, and not as a competitor as Russia is for gas supplies to Europe. Russia’s role as a supplier of finished goods disappeared with the downfall of communism.

China sees the pipelines for hydrocarbons from Central Asia as a hedge against possible disruptions of shipping lanes from the Middle East. However, just as it is beefing up its Navy to protect those lanes, and to rely less on US maritime power, it will have to beef up its security along the pipelines to protect them from possible attacks.

Russia sees China as a good partner in its policy of containing the US in Central Asia and elsewhere. In fact one can say that Russia sees China as a partner only when its relations with the West are less than perfect – which is the situation at present.

China has been able, so far, to restrain any influence the US could have on Central Asia thus enabling China to secure energy resources for itself and to prevent the infiltration of democratic ideas.

The US has key interests in the region: to support its military adventure in Afghanistan, to have access to energy – without relying on the Russian logistical infrastructure – and to wield political influence in the entire Central Asian area. The US also sees an opportunity to lessen Russia’s position as a gas supplier – should the Central Asian republics find alternative routes for their gas shipments, Gazprom will no longer be in a position to export as domestic demand is rising from an already important base.

Weapons

China’s strategy has been, and will continue to be in the foreseeable future, to encircle India both through its own forces and through those of its allies who neighbour India, Pakistan in in particular. China, nevertheless, contrary to the US, is not part of any defence organization and thus does not have the burden of having to defend the territories of other nations.

China’s military budget for 2015 has been increased by 10%, reaching $145 billion, a rather steep figure in regard to the slowing of the country’s economy. China has installed missile systems pointing to India’s major cities while China’s industrial heartland is very far removed from their common border.

China’s nuclear strategy is to use their missiles only for a second strike and not to use them for a first strike on any state. It may, however, rapidly change this policy if it so decided.

India is also worried with the building of a port, by China, on the coast of Myanmar, that would give China direct access to the Bay of Bengal. It is also worried by the increasing presence of Chinese submarines in the Indian Ocean. The submarines use Colombo as a refuelling port, leading India to fear that China was building alliances with countries surrounding India – the so-called ‘string of pearls.’ China has called this project the 21st Century Maritime Silk Road, a project financed by China to the tune of $40 billion.

Indian military hardware purchases, the world’s largest with a budget of $250 billion over 10 years, are an important source of cash for the ailing Russian military manufacturers.

The two countries will be jointly developing a fighter plane of the fifth generation. India has also served Russia as a basis to enter the South East Asian markets for military hardware by servicing and training users of Russian equipment sold to those countries.

Russia has been very supportive of India in its conflict with Pakistan over Kashmir, among other things committing not to supply weapons to Pakistan, an embargo it lifted in 2014.

The US has also been a major provider of mostly defensive weapons to the Indian army and this may lead to a licensing agreement for India to manufacture American weapons.

India and Japan have reached an agreement regarding military cooperation. Japan is about to review its constitution to enable it to expand its military which is already considered as one of the world’s best and China would have problems measuring themselves to Japanese firing power in case of a conflict. It is also backed up by the US military that have bases in Japan.

The main discussions between the two countries centred on the supply of nuclear technology and fuel to India by the US. This is an important step considering the fear of nuclear proliferation pervasive in the world today and particularly considering the fact that India will be adding to an already existing nuclear capability while it has never signed the Nuclear Non Proliferation Treaty (NPT). This allows the US to put pressure on New Delhi to reduce its energy purchases from Tehran. Further, India’s rivalry with Pakistan might lead the latter to accelerate its own weapons programs should India proceed with its own purchases.

For India this is an important development as its supplies of uranium are drying out. The treaty also allows it to remain a nuclear player without signing the NPT, although the country has entered negotiations with the International Atomic Energy Agency to negotiate an agreement that would have clauses specific to its situation.

The US has insisted on certain clauses in the treaty such as India accepting not to undertake further nuclear testing, not reprocessing the spent fuel and accepting that the President of the United States certifies, annually, that the country is respecting these clauses.

For the US this is a major step in containing China and relations between China and India took a turn for the worse, with China supplying nuclear power plants to Pakistan, after this agreement was signed.

Another main motivation of the US has been to prevent India making up for its energy shortcomings by purchasing Iranian gas that would be routed through an Indian-Pakistani pipeline. Financial motives are not left too hard behind, considering the deal would generate close to $100 billion in sales for US corporations to which must be added large sales of defence equipment which presently India purchases from France and Russia.

India is also the country with which the US has conducted the largest number of military exercises in recent years.

Following President Obama’s visit to India in 2015, a Joint Strategic Vision for the region was agreed upon. Its objective is to support sustainable development and address poverty. However, the main objective is to ensure India’s Navy plays a dominant role in the Indian Ocean.

Japan is now allowing its military to have an activity outside the country’s territory.

China’s increased militarization worries Japan, particularly the installation of missile launching ramps, China’s declaration of an exclusive maritime and air space, and the highly vocal Chinese media constantly threatening of war with Japan.

China, in turn, fears a reunified Korea with nuclear weapons.

Russia continues to be China’s main weapons supplier as it wants the money from these exports which are of the order of $2 billion per year. Since 2006, the two countries have conducted joint manoeuvres, and intensified their military cooperation.

China, however, no longer represents an overwhelming share of Russia’s weapons exports – a mere 20% today from a high of 70% ten years ago, while the value of total exports has risen considerably, thus decreasing even more the importance of Chinese purchases. Further, with the new cold war, Russia itself is becoming its own major customer.

Russia is eager to maintain this monopoly on Chinese weapons purchases, and the EU and US embargo assist them in achieving this objective. However, inevitably, China will want to be involved in weapons development and testing rather than simply acquiring technology entirely developed in Russia. It has already indicated it does not want to buy finished weapons or assembly kits but want to build the planes in China.

On a longer term basis, it is obvious that China will develop its own military platforms and it is already successfully copying several weapons systems thus severely reducing its imports from Russia. This worries Russia as on a conventional army basis, China would have the upper hand in case of conflict, and Russia would have to rely on tactical nuclear weapons where it has the upper hand. While the INF treaty constrains Russia’s capability of deploying intermediate range nuclear missiles, Russia would probably opt out of the treaty should it feel threatened by China.

North Korea is actively developing its nuclear program and at least one estimate is that it may possess 100 nuclear heads by 2020.

On the other side of the demilitarized zone, there are US forces on the ground. The US keeps 40 000 troops in South Korea.

Border issues

China and India have fought several border wars and in November 2006 China declared one of the Indian provinces, Arunachal Pradesh, to be part of China, calling it South Tibet. India also claims China is occupying illegally an Indian province in the Himalaya.

In fact, China and India are in a constant military confrontation along their mountainous border.

China is also in a confrontation with several countries regarding their maritime borders, and particularly Japan.

The Diaoyu / Senkaku (Chinese and Japanese names, respectively) islands have been a bone of contention for 120 years but China has lately become assertive on their claims particularly as it is believed that the waters surrounding them are rich in hydrocarbons and fishing grounds.

China’s attitude is also fed by the fact that it is using Japan as a useful scapegoat that helps it maintain strong nationalist feelings of its population, an important cement in a country in which social pressures between different groups, such as rural and urban, are increasing and threatening the country’s stability. China also believes that Japan is on a long-term decline and will not be able to adequately respond to China’ bullying presence.

China’s claim that the entire South China Sea belongs to it has opened the door for the US to pose as the protector of the South East Asian countries.

The South China Sea is an important point of convergence between the interests of the two countries as well as the countries of Southeast Asia. The rise of Chinese naval power – which could become larger than that of the US in the next 5 years – could threaten the US’ dominance in the area.

The South China Sea sees the flow of half of the world’s trade and the conflictual situation could disturb the globalization process which explains why China is becoming interested in continental routes and goods are shipped by train through a new train link which is the worlds longest and reaches all the way to Madrid.

The interest in the area, however, does not stop there. China believes that it contains massive quantities of oil – approximately the same as those in the Arab Gulf.

China’s development and purchase of high-powered microwave weapons, 1500 missiles, submarines and amphibious ships seem targeted at resisting, or keeping at bay, the US Navy in case of a conflict with Taiwan. As a response, the US moved 20 vessels from the Atlantic to the Pacific fleet in 2007 and more such moves are forecasted. The South China Sea is considered by the US as a natural border China should not cross. It is a strategic passage point between the Indian Ocean and Japan and Korea.

China also has a border issue with Russia. The two countries share a 4300 km border and an important historical confrontational past.

Inside those two borders the major issues about the autonomy of certain regions and peoples – Taiwan, Tibet and Xinjiang for China and a considerably large number of areas in Russia and the adjoining countries in Central Asia that were once part of the Soviet Union. If China has a clear position on this issue – i.e. a total aversion to any such move including with the use of force and population movements – Russia has a more opportunistic stance. It has fought an internal war to prevent the Chechen aspirations to an independent state but intervened military outside its borders in Georgia and is the only country to recognize Abkhazia and South Ossetia as independent states.

Russia fears that its under-populated and vast expanse of territory rich in natural resources, Siberia and the Far East, yields in the face of China’s demography while Russia is in a state of demographic collapse. These two areas have large deposits of hydrocarbons, diamonds, gold and other metals as well as large tracts of forests that provide raw materials to the Chinese paper industry.

Some of the lands forming the region of the Russian Pacific were Chinese until the eighteenth century, and while China has not made any recent claims for their return, Russians fear they may do so.

Russia and China are intent in developing their relations but simultaneously competing for domination of Central Asia and attracting Japanese and South Korean capital to develop the Far East so as not to be exclusively bound to China.

Simultaneously, Russia will redevelop China’s and North Korea’s moribund industry in the adjoining North Eastern parts of the country so as to economically integrate these areas.

Russia also has a contentious issue with Japan that has prevented the signing of a peace agreement between the two countries since the end of the Second World War. It concerns what the Russians call the Southern Kuril Islands, and the Japanese the Northern Territories.

Russia carried out military drills on the islands and announced it would spend over $1 billion between 2016 and 2025 to develop these islands. Japan would like to invest in these islands, particularly in energy projects.

While for many years neither country appeared to think, in spite of speeches to the contrary, that dealing with the other was a priority, Primer Minister Abe’s visit to Moscow in August 2013 seems to have started a different process. One thing Japan needs to avoid at all costs is a coalition between China and Russia.

A dialogue process was started between the defence and foreign ministers of the two countries to discuss measures to combat piracy and terrorism.

Russia’s strengthening of its military presence in the Arctic should also be considered as part of its Asian play, the Arctic being a possible base for ventures in Europe, the American continent and Asia.

Japan also has a territorial issue with South Korea centred around the Takeshima or Tokdo islands, as called respectively by the Japanese and Koreans, that each country claims to be a part of their territory.

These are very small volcanic islands. They are, however, of interest economically as their waters are good fishing grounds and the surrounding waters are believed to contain gas, although none has so far been found. Further, if an international arbiter would rule in favour of Korea, Japan’s case for the Kurile Islands and the Senkaku Islands would be severely affected as the country’s claims in all three cases stems from the San Francisco Peace Treaty that remained vague on this issue.

East Asia

The Galwan Conflict: Beginning of a new Relationship Dynamics

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The 15th June, 2020 may very well mark a new chapter in the Indo-Chinese relationship and pave the way for totally new politico-strategic equations, shaping the way for a more complex and unstable world order in the near future. On this night, a bloody, violent and unusual armed clash took place between two of the world’s fiercest armies, Indian and Chinese, at the heights of Galwan Valley in Ladakh. Officially, India has admitted losing 20 of its soldiers, including a senior officer while China, continues to be discreet about PLA casualties and after a good 8-months hiatus, came up with a what everyone knows a blatant lie– a 4-death figure.

This border conflict however, has made the situation volatile between the two Asian powers. The borders between the two, almost 3,400 Kms continue to remain unclear and non-demarcated in the form of Line of Actual Control (LAC) and that is something the Chinese side, is quite keen to continue with. It is the Chinese strategy that it has employed since 1950s to continue occupying territories without firing a single bullet. From Tibet to Aksai Chin to South China Seas, China has gained territories by portraying itself as a great military power but not really able to showcase its military might anywhere.

However, the efficacy of its military remains questionable on certain credible grounds. It is well known that the Chinese PLA comprises of officers and troops who are recruited on account of their loyalty and service to the Chinese Communist Party (CPC) and not entirely on professional grounds and hence, is a politicized force. Internal reports leaked out from China have also indicated of massive restructuring and training exercises for the PLA to keep it as a proper fighting force, being initiated on direct orders of the Chines President, Xi Jinping.

The PLA again does not have a distinguished military track record. In 1954, it occupied Tibet, a free, sovereign country till then who had at best, a medieval age, security force to defend itself. In 1962 border conflict with India, it won due to the impuissance of Nehru and his lack of politico-strategic vision and leadership. However, the border conflict at Nathu La with India in 1967, proved to be its undoing with PLA losing more than 300 soldiers against Indian losses of 80 troops.

Even in the Vietnam war, it failed to emerge as a clear winner against the tiny Vietnam. Since then, it has had no real time fighting exposure. In one of the highly embarrassing episodes, a unit of the PLA as part of the UN peacekeeping duties, ran away leaving their weaponry and armaments, in Sudan in 2016. In the very recent Galwan fight-off with the Indian border troops, again the PLA failed to show it in a gallant light as in spite of a virtual 4:1 ratio against Indians, it failed to ensure a victory and in fact had to concede the area to Indians it had occupied surreptitiously a few weeks ago.

It is true that since the commencement of economic reforms in China in early 1980s, the single party political dictatorship has helped China to grow economically and emerge as the manufacturing hub of the world. The impressive economic turnaround has helped China to enhance its political stature in the comity of nations while also providing with enough money to use them for furthering its politico-strategic objectives. From making huge investments in national economies of Europe, US, Canada to Africa, South and South-East Asia to becoming a major player in global capital and bond markets, China has strategically made its presence felt.

With Xi Jinping’s accession as the Chairman of CCP, ambitions of China got a new fillip. The highly ambitious politico-strategic initiative, in the form of debt diplomacy, the much-touted Belt and Road Initiative (BRI) emerged as the innovative neo-colonialist Chinese weapon to secure the political and military control of the world. Already many countries beneficial of Chinese strategic benevolence like Pakistan, Sri Lanka, Congo, Senegal, Kazakhstan are feeling the pinch. Their politico-strategic sovereignty is under a severe threat from China. No wonder, other countries like Bangladesh, Myanmar, Maldives and many others are trying to balance their politico-strategic relationship with the middle kingdom.

Subsequent to the Galwan fiasco, after the Doklam setback in 2017 China seems to be in a catch-22 situation. It is not in a position to go for even a limited war with India while compelled to a negotiated settlement with India, has affected its perceived military capability adversely. While losing the political and military trust of India in a hurry, it has made India more emboldened and cautious.

India has suddenly gone into a military build-up overdrive with scores of new missiles and armaments that have been tested in recent months. On the politico-strategic front, much to China’s dismay, QUAD is getting into a shape while the US Navy and Air Force is constantly increasing its presence in South China Seas. Taiwan too, is getting bold and willing to face China, with the US as its protector.

Japan that till recently maintained its dependence on the US alone for its security, too has opened up and started bolstering its defences with China in mind. Countries in the region like Philippines, Indonesia, Vietnam are getting into strategic dialogues with India to counter China’s strategic dominance. They are also opening up to arms imports from India. And most importantly India has started seeing itself as a strategic rival to China, more explicitly. Voices in New Delhi regarding getting closer to Taiwan, are undoubtedly a pointer in that direction. And so is the Chinese reactions when its embassy is seen publishing full page advertorials in Indian media, cautioning against abandoning the so-called One-China policy.

While military and diplomatic negotiations on disengagement and de-escalation continue between India and China, it will remain debateable if China actually gained out of its latest incursions in Ladakh. While its PLA had an element of aura till Galwan, since then questions repeatedly are being raised on the capability and leadership of the entire PLA. How far those assessments are correct or otherwise need to be seen but it seems absolutely certain that China has lost much in the process. It will have to prepare for a new, emerging politico-strategic dynamics that could well be not to its liking.

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East Asia

Sino-US rivalry and the myth of Thucydides Trap

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The writer of the view that are an outcome of complex phenomena. One can’t understand them through the lens of Thucydides trap which he considers nothing short of a China-bashing myth. He points out that nuclear capability itself is a great deterrence to war adventurism.  He stresses that wars are outlandish in terms of postulates of Modern theory of Conflict Management; that states conflict is not spread by a black sheep but it is natural to human relations. It can’t be eliminated by eliminating the blacksheep. The key to success lies in keeping the conflict to its minimal point while remaining peacefully engaged with one’s adversary.

Wars end in ceasefires, “grand concerts’, and realisation that they were avoidable. That they were cumulative upshot of reciprocal stupidities of belligerents.  Post-World War II period has not witnessed any war between major powers as they realise that how destructive a nuclear war would be. The potential belligerents nowadays enjoy armchair warfare blaming one another of hostile intentions.

Fallacy of thinking templates

The best way to analyse why a war broke out in the first place is to interview the key warriors or belligerents. But, most of them stand perished in wars unable to tell their part of the story. As such, major powers rely on thinking templates like Thucydides Trap to create imaginary rivals to fit in the crucible of their templates.

Thucydides’s Trap comes about “when a rising power threatens to displace an established power. Graham Allison, in his Destined for War (page vii) says, ‘As a rapidly ascending China challenges America’s accustomed predominance, these two nations risk falling into a deadly trap  first identified by the ancient Greek historian Thucydides…He explained: It was the rise of Athens and the fear that this instilled  in Sparta that made war inevitable’. Though key players may abhor wars “unexpected events by third parties or accidents that would otherwise be inconsequential or manageable, but even ordinary flashpoints in foreign affairs, can act as sparks that trigger large-scale conflict”.  Thucydides trap could perhaps be rephrased as stupidities trap.

Arnold Toynbee once said” history is something unpleasant that happens to other people”. Through their myopic decisions rulers sleep walk into the vortex of war. They are sure that their enemies would perish both they would survive. Yet the outcomes are quite pungent. Look at the outcomes of the World War I (1914-18) and II (1939-45). When the World War I ended  in 1918, the Austro Hungarian Empire had vanished, German Kaiser ousted, Russian Tsar shown the door, France, Britain and so many other countries were left to mourn loss of depletion of their treasuries and extinction of youth  capital (scientists/engineers/doctors/teachers/intellectuals-to be). At the end of the World War II, Germany could not replace the United Kingdom. Two unexpected hegemons the erstwhile Soviet Union and the USA were born out of the womb of the war. The UK lost the fifty colonies that Hitler much talked about in his fiery speeches.

Before committing suicide, Hitler must have reminisced ‘ I was mistaken not to have thought about eliminating England as they were sons of a German tribe l’anglais who migrated to britain due to vagaries of nature’. ‘I was a fool to have ventured into the freezing Russia’. John Fitzgerald Kennedy rejected the dictum “better dead than Red”. Yet many of his decisions pushed closer and c loser to a nuclear confrontation with the Soviet Union. During post-WWII, McCarthyism had blurred American vision so much that they saw red in everywhere.

Classical versus Modern theory of conflict management

Relations and conflicts between states  

Thucydides trap takes a simplistic view of relations and conflicts between states.Thousands of years back Chanakya posited his mandal (interrelationships) doctrine.

One of his most misunderstood postulate is ‘all neighbouring countries are actual or potential enemies’. So they have to be subdued. Little attention is paid to another of his counter-balancing postulate, mandal (interrelationships) doctrine. In mandal, Chanakya thinks in terms of intersecting and just touching circles. He focuses on intersecting section of two intersecting circles like in mathematical solution set theory.

Even Kissinger, Kafka, et al, believed in establishing effective ‘spheres of influence’. Rich, powerful and progressing countries could but would not shun their poor pals in the comity of nations.

History shows that weakness invites aggression. Often militarily strong countries have attacked weaker nations with ‘litany of problems’ on one pretext or another. Economic motive could be unearthed in both modern and ancient wars. For instance, the Trojan War (1250 BC) was caused by an economic rivalry between Mycenae and Troy. Grants by Persia of good western Anatolian land to politically amenable Greeks, or to Iranians, created a casus belli for wars with rivals.

Yet all wars are justified by the now discarded  Classical Theory of Conflict management, and rejected by the Modern Theory of Conflict management.

According to modern theory of conflict management, terrorism or any conflict for that matter is not really caused by a few black sheep, as assumed under the Classical Theory of Conflict Management.

The Classical Theory says that “conflict is created by a blacksheep. If he is eliminated the conflict is eliminated there and then”. The modern theory, on the contrary postulates “No matter what you do conflict cannot be eliminated. It is natural to relations. However, through effort, it could be kept at its minimal point. And the minimal point is the optimal point”.

Fallacy of rising Dragon

It appears that Joe Biden is not a prisoner to Thucydies trap. He views rivalry with China as intense competition not as confrontation. He calls the shots but then quickly defuses the situation. For instance, to pacify furious China about `freedom of navigation’ in the South China Sea, he dispatched USS Pal Jones into the Lakshadweep waters. The aim was to send the message, that China need not fume and fret much about the Quad. The USA still thinks in terms of some principles.

Neither Sparta nor Athens was a nuclear power. If so, they would have perhaps preferred to remain engaged in a long period of cold war. In the ancient Greek world, it was Athens that threatened Sparta. In the late 19th Century, Germany challenged Britain. Today a rising China is believed to be challenging the United States. But, neither China nor the USA is structurally similar to Sparta or Athens. For ease of thinking we liken the two states to either China or the USA.

Today’s China is more inspired by Song dynasty which pushed economic progress through peace rather than wars like some other dynasties. China remarkably grew in terms of Gross Domestic product, imports, exports and reserves. But it still lags behind the USA.

China’s GDP of 7%  as a percentage of the United States’  in 1980 rose to 61 % in 2015, imports from 8%to 73%, exports from 8% to 151%, and reserves from 16% to 3140%.  Chinese economy doubled every seventh year. Still, it is no match for the USA. Chinese workers have become more productive. Yet they are quarter as productive as the American.  China still lags behind the USA in major economic indicators. Look at Chinese economic size in terms of GDP:  year 2000 ($ trillion 1.211), 2010 (($ trillion 6.101), 2016 (($ trillion 11.199). Corresponding figures for the USA are: U.S. 2010 ($ trillion 10.285), 2011 ($ trillion 14.964), 2016 ($ trillion 18.624). GDP per capita ($) for the aforementioned years from 2010 to 2016: China 940.  4,340, 8,250. U.S. 36,070, 48,950, 56,810. Researchers in R&D (per million people) China: 547.3, 903, and 1176.6. Corresponding figures for the US:  3475.7, 3868.6, and 4232. R&D expenditure (% of GDP) China:  0.896, 1.71, and 2.066. U.S.: 2.617, 2.734, and 2.794.

True, China has been the fastest-growing economy since 1979. Yet, it is nowhere near surpassing the USA even on one account that is gross Domestic Product. Heretofore are China and US figures of economic growth for the years 1977, 1987, 1997, 2003, 2008, and 2019. China: China 843,097, 1,883,027, 3,706,647,   6,187,983, 8,908,894, US$ trillion) 14.4.  USA: USA: 3,868,829, 5,290,129, 7,109,175, 8,431,121, 9,485,136, and 21.44.

Engagement not containment

Wars precede isolation. A benign corollary of Sino-US rivalry is that they are not isolating from one another but engaging in multi-dimensional economic relations.

Mr. Trump was viscerally predisposed to viewing China as a looming military threat to peripheral countries, in general, and the USA, in particular. True, Mr. Biden is also viewed as an America Firster.

Biden realises that China is much behind the USA in economic and military prowess. China trails behind the USA in terms of expenditure on its defence forces and possession of actual military equipment. Despite ongoing modernization, China spends approximately $ 5 billion in arms export far below US exports of about $ 46.5 billion. China’s sales are about three per cent of global sales while the USA’s are about 79 per cent.

The US has over 8,000 operational and inactive warheads as against China’s 240 mostly non-deployed.  The US has 2,000 nuclear weapons with strategic/intercontinental-range compared with China’s twenty. The US have sixteen ballistic missile submarines compared with China’s one, and more than 1000 US nuclear cruise missiles, compared with none for China.

The US has ten aircraft carriers plus one under construction attached to the Fifth and Seventh Fleet. China currently has two aircraft carriers, with a third in early construction, and a fourth planned for sometime in the mid-2020 or 2030s. Their first carrier, the Liaoning was commissioned by the PLAN in 2012, though it was first laid down in the early 1990s.

Shades of China’s critics

China critics in the USA are not monolithic. They have many shades including `Engagers’, `Realists’, `Duopolists’, ` China Lead’, `Declinists’ and so on.

The `Critics’ have an un-reconcilable antipathy toward China because of its repression of a wide spectrum of human rights (religious, labour, media and ethnic minority).

The `engagers’ lookup for common ground with China as a matter of national interest. The `engagers’ are optimistic that globalization, economic interdependence and rules of multilateral trade will lead to democratisation in China.

`Realist engagers’ are convinced that China has learnt lessons from the collapse of the former Soviet Union about the dangers of imperial overstretch. As such, China understands the realities of the current international system and limited capacity to change it.

`China Duopolists’ believe the USA and China could cooperate to bring into being a Chimerica (G-2), being the two most important countries.

The `China lead’ school believes China is already on the verge of replacing the USA as the world’s number-one power.

The `Declinists’ believe that the demise of the US global leadership already occurred as `Washington consensus’ has been replaced by `. It is now Beijing, not Washington that is dictating new rules to govern the international economy.

Joseph Biden belongs to the `America Firster’ School that China can’t replace the USA as number-one, even if it tries to. After visiting China, Biden wrote `the United States has nothing to fear from China since it is far ahead of China in size of the economy, per capita income, scientific innovation, and educational excellence among other indicators’ (Biden, China’s Rise Isn’t Our Demise, New York Times, September 7, 2011, online ed.).

Global Leadership

At present, China lacks the soft and hard power to supplant the USA.  To do so, China needs to:

(a) Command loyalty of the majority of the countries. (b) Initiate, innovate and articulate policies, programmes and activities, including dispensing rewards and punishments. (c) Being a `model’, worth emulating, of values, culture, language, laws, and social and political practices. (d) Excel in soft-power resources such as educational and public-health systems

Concluding remarks

Thucydides traps is a china-bashing myth. Biden is a whiff of fresh air, though he has no magic wand to change the climate and trade atmosphere.  He has promised to rebuild America’s decrepit infrastructure, spend more on health and education, and ease immigration.  He has pledged to raise tax on firms and the wealthy.

He is no revolutionary though his policies are tilted to the left of what Trump did. His job is to re-unite fractious American democracy. He is inclined to shun the personalized style of his predecessor’s rule, scorning decency and truth.

Joe understands China better than his predecessor. But, it remains to be seen how the USA would set right the topsy-turvy alliances that Trump had interwoven. Confrontation with China will make it difficult for Biden to deliver his promises to the American electorate.

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East Asia

Xinjiang: The New Ideological Battleground between the US and China

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Months before the Beijing Olympics in 2008, the Uighur separatists allegedly attempted to blow up a Chinese passenger airplane unleashing a decade-long orgy of violence which lasted until 2017.  Chen Quanguo, the CPC’s new party tsar in Xinjiang even proudly boasted of “zero terrorist violence” within one year after he arrived in Urumqi in 2016. This coincided with the release of President Trump’s National Security Strategy in December. Some US commentators see a close link between the NSS 2017 and the sudden shifting of the US focus on the oppression of Uighurs in Xinjiang. Is this why the genocide controversy or new “great game” in Xinjiang was born? 

***

Following the passage of a bill in the US Congress in September last year that would ban imports produced by Uighur forced laborers in Xinjiang, John Pomfret, the former Washington Post bureau chief in Beijing and author of The Beautiful Country and the Middle Kingdom: America and China, 1776 to the Present, told the New Yorker in an interview: “I think that, fundamentally, we’re at a point where we have an ideological problem with China. The ideological competition has many parts, and one of the parts has to do with American revulsion at Chinese human-rights abuses, not only in Xinjiang and Hong Kong but in Han dominated China as well.” (Emphasis added)   

Xinjiang – China: Twentieth Century and at present

The present day political strife in Xīnjiāng – the Chinese term meaning “new frontier” – is the manifestation of the People’s Republic of China founded in 1949. Like Tibet, Mao’s People’s Liberation Army incorporated Xinjiang into the New China by force and through political maneuvers. It is the largest province in size – containing more than 18% of China’s land area – and largest administrative unit within PRC. It is approximately three times the size of France and is centrally located on the Eurasian continent. Xinjiang shares international border with seven countries in South Asia and Central Asia. Yet, and ironically, the Xinjiang Uighur Autonomous Region (XUAR) became the “backyard” of New China – ideally suited site for nuclear tests and nuclear weapon facilities.

Historians of the PRC formative years have argued, the CPC inadvertently took advantage of the exceptionally favorable international environment created by the Cold War in unifying China in the 1950s. “Mao’s turn to the US in 1971 and China’s support for US operations inside Soviet-occupied Afghanistan, created a basis for Islamism in Xinjiang itself and unleashed powerful forces that now threaten to once again break up China,” observed an international affairs commentator recently. Following the collapse of the Soviet Union and the birth of the Commonwealth of Independent States (CIS) further turned Xinjiang into a training as well as recruitment safe haven for Mujahidin militants from among the Uighur separatists. More often than not, besides being aided and funded by the Turkish government, the CIA too proactively carried out its penetration in the region.

Apparently, alarmed by the “anti-China” foreign forces’ penetration into the region, the CPC began adapting countermeasures and decided to implement its policy of large-scale Han migration into the region in the 1990s. Probing the massive riots in July 2009 in the Xinjiang Uighur Autonomous Region (XUAR) capital city Urumqi, a recent research paper by Amy H. Liu and Kevin Peters claims the ethnic violence was the result of Beijing’s ambitious Great Leap West plan launched in 1999. According to the two authors, while available data does show the economic benefits have been enjoyed by all people in Xinjiang, regardless of ethnicity, relations between the Han dominated Beijing and the Uyghurs in Xinjiang have remained unchanged, if not worsened.

Unity among China’s ethnicities: Like “seeds of a pomegranate”

Undeterred by unprecedented violence erupting during the visit to the region by the top CPC leader, President Xi Jinping appeared more determined to crush Uighur separatist violence after his maiden “inspection tour” in 2014. It is pertinent to recall, a bomb tore through Urumqi railway station, killing three and injuring several on the day Xi arrived in the province’s capital. In the preceding weeks, “dozens of civilians were hacked to death at a busy train station in China’s south. A Uighur drove a car into crowds at Beijing’s Tiananmen Square. Forty-three died when men threw bombs from two sports utility vehicles plowing through a busy market street in Urumqi,” as reported by the Associated Press on the tenth anniversary of the July 2009 violence. But apparently, Xi had visited Xinjiang to ensure smooth implementation of what subsequently became known to the world as China’s, or rather Xi’s, most ambitious national strategy, i.e. One Belt, One Road (OBOR) or BRI – the Belt and Road Initiative.

In fact, a few months after the tenth anniversary of July 2009 Urumqi violence, an exclusive NYT report claimed newly appointed Chinese president Xi, also the party chief, had laid the groundwork for the crackdown in Xinjiang in a series of speeches delivered in private to officials in April 2014, just after Uighur militants stabbed more than 150 people at a train station, killing 31. “Mr. Xi called for an all-out struggle against terrorism, infiltration and separatism, using the organs of dictatorship and showing absolutely no mercy,” (emphasis added) the NYT reported.  “Shortly after arriving in Urumqi, at a Xinjiang Work Conference, Xi ordered the local authorities to remold the region to ward off ethnic extremism. China’s ethnicities could and should be united like “the seeds of a pomegranate,” the AP news, cited above, quoted state media as saying.

Interestingly, to both left and right cynics who critique China for having abandoned communism and for the party-states’ woke policies towards ethnic minorities respectively, it is crystal clear that to dismiss or deny existence of re-education or internment camps, sterilization of women, mass surveillance reliant on big tech, forced labor, market expansion and police brutality etc – in China and elsewhere – is tantamount to “embracing simplistic prescriptions.”  Not surprisingly, even Noam Chomsky, among others, signed a statement released recently stating: “China’s present signature foreign policy initiative is the “Belt and Road Initiative” (BRI) that seeks to connect the PRC economically to the rest of the Eurasian continent through large infrastructure projects that will stimulate international trade. As a result, the XUAR has become a very important strategic region for China, and the state views its indigenous populations as an obstacle to developing its vision for this future critical center of international commercial networks.”

Genocide controversy in Xinjiang: What will China do?

However, without going into the merits of who is indulging in “false propaganda” and who is stating the truth with regards to the so-called “genocide” inside Xinjiang, the questions for us all to ponder are: when did we first hear about the million Uighurs being tortured in internment camps and of the genocide in Xinjiang; now that the United Nations has directly engaged with authorities in Beijing to send a UN delegation on an “unrestricted visit” to Xinjiang, what will Beijing do; if at all the UN demand is acceded to by the PRC, will the UN fact finding team’s report stand the test of scrutiny by the international community or by the Chinese government; and last but not the least, will Beijing dictate the composition of the UN delegation or not?

Finally, in the face of Beijing’s rigid refusal first to the European Union and most recently to the United Nations Human Rights Council (UNHRC) to conduct “unrestricted visit” to Xinjiang, it is increasingly becoming apparent China’s diplomacy is facing “crisis of confidence.” Besides, a recent article in ftchinese.com claims, China’s initiative to conduct a visit to the troubled region by “friendly” Islamic nations has run into trouble too. With more and more developed countries, including most recently Japan, either threatening or resorting to sanctions over accusations of genocide in Xinjiang, indicates China’s failure to convince the outside world of Beijing’s narrative on Uighur terrorism. Sadly, however, it is quite clear Chen Quanguo, who took the helm of Xinjiang by replacing Zhang Chunxian in 2016, and who is among the top party officials sanctioned by the Biden administration recently, is not amenable to any such visits by a foreign delegation. For, it is precisely the tough measures being carried out by Chen which are being condemned by the Western governments as genocide. Chen even proudly reported recently of “zero terrorist attacks since 2017.” Consider this, even the party’s fourth senior most official in charge of the violence stricken region, Yu Zhengsheng, had said in 2014 after the knife stabbing at the train station in Urumqi: “It was necessary to tell the Chinese public not to apply any label – such as terrorism – to Xinjiang.” (Emphasis added)

To conclude, the authorities in Beijing it seems had been preparing for long for the ideological battle moment with the US to arrive, as John Pomfret, cited above, observed. But at the same time, as in the words of globally respected veteran Chinese-American affairs scholar at Beijing’s prestigious Tsinghua University, professor Yan Xuetong, leadership in Beijing has been for decades extremely cautious to prevent such ideological rivalry from intensifying. “Engaging in ideological rivalry will have negative impact on China’s rejuvenation. Therefore, avoiding ideological rivalry has become a strategic principle of the Chinese government since the early 1980s when reform and opening up were gaining momentum,” professor Xuetong pointed out in an exclusive opinion piece on the day of the US presidential election last November. Perhaps, Beijing would be wise to listen to the advice offered by the ftchinese.com columnist – a mainland Chinese scholar – that Chinese foreign ministry “must display more prudence and diplomacy” in fielding critical and even embarrassing questions, including ideology!         

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