In a speech this year in Moscow, Indian Foreign Secretary highlighted the three strategic geographies- Eurasia, Indo-pacific and the Russian Far East (RFE), and the Arctic, which will be the key emerging theatres of geopolitics that upcoming diplomats will be engaged in throughout their careers. He further stressed that not only is Russia crucial to all the three regions, but there is also an inherent need of multi-polarity for the security and prosperity of these regions. Also, a multipolar world and a multipolar Asia is not possible without India and Russia.
Did the Foreign secretary underline the increasing Chinese ambitions in these regions and the need for countering these ambitions by pointing towards the necessity of multipolarity in Asia? Several questions arise when we take in consideration the recent rejuvenation in the relationship between India and Russia, and the narrative that strategic hedging against China is the main motive behind this rejuvenation.
For answering these, one needs to understand why China is interested in these regions and what has been China doing in these key areas. Further, what are India’s stakes in these regions and whether India can think of competing with China here. Moreover, how Russia looks at the competition if it exists. This piece tries to analyze these questions and highlight the ongoing geopolitical dynamics in the RFE and Arctic and the pertaining Indian and Chinese foreign policies, in their past, present, and future goals.
Importance of RFE and Arctic
Geographically, RFE comprises of the Far Eastern Federal district that is the easternmost territory of Russia sandwiched between eastern Siberia and the Pacific Ocean. The district shares land borders with Mongolia, China, and North Korea to the south and shares maritime borders with Japan to its southeast and with the US to its northeast.
Having never known serfdom, this region has been culturally, religiously and politically different from Moscow and the Russian heartland for a major part of history, by virtue of more entrepreneurism and autonomy. Today there exists an additional dimension to this ‘difference’ between the RFE and the center. In the Soviet period, the region was tied to Europe economically but in past decade it has become increasingly clear that several of the Far Eastern krais and oblasts (units of governance in Russian political system like districts), especially those bordering China are now economically dependent more on Asia than on European region. This situation is compounded by migration related demographic issues. For more than a decade now the region has witnessed exodus of ethnic Russian population and seen a growing influence of Chinese businesses and migrants. The extent of this phenomenon is widely visible as over the years large tracts of land in this region have been leased to Chinese for farming, infrastructure projects and energy exploration, with a low tax regime and a considerable amount of autonomy over the activities. As a result, the region has witnessed emergence of Chinese run farms which look like fortresses, surrounded by high fences and red flags.
The Arctic is deemed as the northernmost region on Earth. While most part of this region used to remain covered with snow for a major part of the year, this phenomenon has been on a downfall due to changes being purported by climate change. The Arctic region not only contains plethora of mineral resources but is extremely important from strategic point of view. During the cold war era, the Arctic held a prominent place in the political and military standoffs between the two superpowers- US and USSR. The region observed a drop in the geopolitical and geostrategic relevance in the 1990s and remained of ‘low tension’ due to commitments made by the Arctic states to keep the Arctic a zone of peace.
The unfreezing of snow makes way for the possibility of opening of the Northern Sea Route which can provide a cost-effective and shorter duration alternative for global shipping routes. Also, scientific developments taking place in hydrocarbon exploration and exploitation can lead to full-scale utilization of the resource base of the Arctic in near future.
Since the rise of Vladimir Putin at the helm of Russian Federation, Moscow’s approach towards development of the RFE has been to inject money into existing industries which according to many analysts of the field has not worked due to the lacunae in addressing the problems of infrastructure and regional integrity. Moscow desires to integrate the region with the broader Asia-Pacific region to solve the problems of development, investment, and connectivity.
In last few years, Moscow has taken decisions like encouraging the return of Russian ‘compatriots’ from Central Asia to accelerate large scale projects. It has also created Special Economic Zones with low tax regimes, focused on modernizing the ‘Trans-Siberian railway’ network, and emphasized on plans to invite investments in the region from nations like India and Japan, beyond the biggest investor in the region- China.
It has to be noted that any developments in the RFE cannot be in isolation from that in Arctic. With the aim of developing both the regions in concurrence, Moscow created the ‘Ministry of the RFE and the Arctic’ which is now working on creation of a corporation in order to supervise the economy and to assume control over elements like ports and exchanges. For the Arctic, Russia rolled out its ‘Strategy for Developing the Russian Arctic Zone and Ensuring National Security through 2035’ in October last year, which aims to advance the development of the region’s abundant resources (especially oil and gas), and improve living conditions for the population. As a long-term objective, Russia hopes to establish the Northern Sea route as a new global shipping lane. These aims and policies need to be considered while understanding Chinese and Indian policies and ambitions and the emerging geopolitical triangle between the three countries, resulting in both cooperation and competition.
The India-China Competition
The perception of China has seen a rise and fall in the last three decades in Russian society. Unlike the 1990s, when there was much skepticism regarding a rise in Chinese immigration, Russia became less wary of engaging with China when relations with the west deteriorated in the aftermath of conflicts in Georgia in 2008 and in Crimea in 2014. Gradually, China became the leading source of foreign direct investment in the region as well as the leading exporter to the districts at the Russia-China border. The extent of asymmetry in terms of trade resulted in a situation where while the exports from this region are diversified among the three northeast Asian states- South Korea, China and Japan, the imports are heavily dominated by China, mainly consisting of machinery, equipment and metals. This imbalance has been further aggravated by factors such as sanctions by the west- leading to declining investment from European nations, and the dramatic rise of China in realm of manufactured goods- which has led to stagnant conditions for the local industries of these regions which are now dependent on export of mainly raw materials and minerals.
As observed by some experts, Beijing’s interest in the region increased after the Global Financial Crisis of 2008 when the Chinese investment was followed by an influx of Chinese migrants in the five districts at Russia-China border, namely- Amur oblast, Jewish autonomous region, Primorsky Krai and Khabarovsk Krai. From amongst these regions, Amur oblast has the largest gold reserves in Russia, while in another near-border district of Oktyabrsky, there are large Uranium deposits. Adjoining Amur is Sakha (or Yakutia), which carries the world’s largest diamond deposits.
However, mineral resources are not the only source of motivation for Chinese investment in the region. RFE contains huge potential for infrastructure development in realm of power generation (where Chinese electric companies have already shown interest to gain foothold), and upgradation of railway infrastructure which can connect the RFE, Northeast China and Japan with Europe with a land-based network and thus reduce the sea-dependence. Invariably, there has been an increasingly accepted reality that like the Russian Asia-Pacific policy, the policy in RFE too might become lopsided due to the factor of overdependence on China.
Kremlin on its part remain aware of the increasing dependence on export of raw materials to China. China on the other hand is working actively in diversifying its own energy imports and is now seeking to compete with Russia in realm of exports to traditional Russian markets for weaponry and technology. Ideas like temporary placement of skilled manpower from India in RFE are being explored. Besides this, the pledge by India for a $1 billion Line of Credit for development of the RFE highlights the importance being placed by the two countries to make this region a source of renewed cooperation. For now, the plans have been in phase of conceptualization and once the implementation stage arrives, China’s stance towards the potential competition here will be interesting to observe.
Unlike the case of RFE, the changing dynamics and increasing Chinese interests in the Arctic region have been debated and speculated much more in the global geopolitical arena. In the last two decades, not only has Beijing accumulated memberships in all Arctic-related regional associations in some form, but Beijing has also made it a surety that China actively participates in all international organizations whose responsibilities cover the Arctic Ocean and laws related to it. To this end in the past decade, Beijing has started projecting its interest and speaking up on issues pertaining to Arctic. The extent of this activism can be verified by the aims and objectives mentioned in the white paper published by China on 26 January 2018, titled ‘China’s Arctic Policy’. This policy paper very explicitly states that China will participate in regulating and managing the affairs and activities relating to the Arctic, and that ‘respect’ is the key basis for China’s participation in Arctic affairs.
Beijing has made it clear that it has formulated policies and have interest in every realm in the Arctic, ranging from development of shipping routes, exploration and exploitation of oil, gas and minerals, conservation and utilization of fisheries, tourism, as well as strengthening her leadership credentials by having a say in Arctic governance. In totality, if RFE is a region for China’s increasing influence in Russia’s domestic landscape, Arctic is much more of an opportunity to put on display the increasing clout and aspirations for being accepted as a ‘great power’ who now has interests in every corner of the world. India, even if starting to present itself as an alternative to China in the RFE, will find it difficult to match the Chinese position in the Arctic.
In January this year, India rolled out a draft Arctic policy of its own and highlighted that India seeks to play a constructive role in Arctic by leveraging its vast scientific pool and expertise in Himalayan and polar research. India remains aware that Arctic might be becoming an arena of increasing power competition. But beyond planning, goal setting, and utilizing the existing mechanisms for scientific development, in coming years, the economic base of India will not let New Delhi go all-out for claiming a position on the Arctic high table. This is bound to increase tensions in Moscow who would not want a challenge to its hegemony in the Arctic by an increasingly ambitious China.
On its part, Moscow has taken several steps to develop the RFE region to reduce its overdependence on China. However, remoteness of the region, outmigration and difficult business environment are some other issues which append the complex dynamic of the region. Beijing is aware of the benefits available due to scarce ethnic Russian labor, lack of investment from other sources for Russia, the geographical difficulties for nations like India for smooth access, and the absence of deep pockets like China for other nations. In case of the Arctic, Beijing is going for proactive diplomacy and wooing the smaller states. Although Beijing would not want to come to blows with Washington or Moscow in any ways, creating a discourse where China starts being seen as a ‘Arctic’ and not just a ‘Near-Arctic’ state will be a big win for China even before any other advantages as mentioned above are realized. India while looking to initiate presence in RFE can be deemed capable to some extent, but the credentials in case of Arctic region seems no match to that of China. Russia on her part, will want India to at least think about trying to punch above its weight and rise to the task of providing Moscow a way for hedging against Chinese hegemonic ambitions. Recently, India has expressed interest in cooperating with other nations like Japan in these key strategic areas. How Moscow responds to these plans by New Delhi will shape the geopolitical dynamics between Moscow, Beijing, and New Delhi in these two emerging regions which look all set to witness a competition in the coming years.