Asia in Review Archive 2018 (January – June)

China (People’s Republic)

News summary

Papua New Guinea and China upgrade bilateral cooperation

(jk) PNG’s Prime Minister has visited China last week and spoke highly of both President Xi as well as of his signature Belt and Road project. He has welcomed increased bilateral cooperation and a status upgrade to a Comprehensive Strategic Partnership. Xi said bilateral cooperation is standing at a new starting point with Papua New Guinea officially joining the Asian Infrastructure Investment Bank and the two countries signing a memorandum of understanding on Belt and Road cooperation, the first of its kind between China and a Pacific island nation [EMTV].

Mahathir Interview: China is a good neighbour – but not all Chinese projects and behaviours are good

(jk) As reported previously on AiR, Mahathir has ordered a review of a number of Chinese infrastructure projects that were negotiated under the premiership of his predecessor. In an interview with the SCMP, he has now laid out that he is not at all “anti-China”, but that he does not welcome Chinese projects that involve giving all contracts to China, borrowing huge sums of money from China, and using only Chinese workers, material and imported goods. If arrangements like this are made, Malaysia stands little to gain and much to lose as seen in recent examples of Chinese projects in Sri Lanka (the Hambantota Port facility) and increasingly Pakistan.

With regards to the South China Sea, Mahathir argued that Malaysia has every intention of retaining the islands it has long claimed as its own, even in the face of new assertions from China. Generally speaking, he has argued for a de-escalation of tensions and a removal of war ships by all parties from the area. Instead, the waters should be safeguarded by small boats (from all concerned countries) that are capable to fight off pirates, but not capable to fight a war in the South China Sea (full interview: South China Morning Post).

Philippines grow increasingly angry over Chinese behaviour at Scarborough Shoal

(jk) Even though Scarborough Shoal rests firmly within the Philippines’ exclusive economic zone (EEZ) of the South China Sea and was part of the Permanent Court of Arbitration tribunal ruling in 2016, it is administered and controlled by the People’s Republic of China after a prolonged naval stand-off in 2012. At the time, many expected the US as a treaty ally of the Philippines to defend Philippine claims against an assertive China, but it instead chose to stand back and help broker a deal which was supposed to see both parties withdraw until an agreement is reached. Whilst the Philippine Navy withdrew, the PLA Navy maintained a presence at the shoal and entrenched its control of the area.

Until 2016, Filipino fisherman were indeed restricted from entering what they refer to as a traditional Filipino fishing ground well within its EEZ. Amid improved bilateral ties between the PRC and the Philippines under President Duterte’s administration, however, China has relaxed restrictions on the entry of Filipino fishermen in the area.

However, in a recently aired documentary broadcast on a major Filipino television channel, Filipino fishermen accused Chinese at the shoal of forcibly taking large parts of their catch [GMA News]. The Chinese side has initially referred to the incidents as more of a “barter trade” since the fish was taken in exchange for other items such as cigarettes and instant noodles, but according to Filipino fisherman the “trade” was forced upon them and less than favourable. President Duterte, trying to uphold his approach of quiet diplomacy and attempting not to confront China outright, went along with this characterisation and arguably made matters worse by claiming that the unfortunate reason that the trade may be unfavourable to the fishermen is that they are not able to determine the real value of the fish [ABS-CBN News 1]. Contrary to this assumption were statements during a media briefing where journalists asked the fishermen directly how they felt about the incident [ABS-CBN News 2].

The Chinese foreign ministry has said that it had been allowing fishermen to enter the shoal “out of good will”, further irking many in the Philippines. Additionally, over the past weekend, satellite images were released in [The Philippine Star], showing the damage that has been done to the shoal by Chinese diggers since 2012. While the Duterte administration is not keen on stoking tensions, some Filipino lawmakers call for a louder response. These include calls for Philippine Coast Guard vessels to be sent to protect fishermen and showing China that the Philippines are serious about defending their people as well as their territory. One Congressman accused China of treating the Philippines as her vassal state and urged the government to  act in order to stop this invasion by China [AEC News / The Philippine Star].

China-Australia relations: Rising tensions over Vanuatu

 (dql) In a move to counter China’s influence in Pacific islands, Australia announced on Monday that it will hold talks on a security treaty with Vanuatu. According to a statement of Prime Minister Turnbull the negotiations will cover a bilateral security treaty on common security interests, such as humanitarian assistance and disaster response, maritime surveillance and border security, police and defence cooperation. The announcement comes amid reports on a military base being built by Beijing on the island. [South China Morning Post/AP]

In a related move, the Turnbull administration will reportedly spend nearly $7 billion on US massive, long-range surveillance drones that will massively bolster Australia’s ability to track military ships on the Asian seas. [The Sydney Morning Herald]

China-Nepal ties deepening

(dql) In a move deepening India’s concerns over China’s influence in Nepal which it sees as its backyard Chinese President Xi Jinping vowed to “continue to support Nepal’s efforts to safeguard state independence, sovereignty and territorial integrity” during Nepal Prime Minister Oli’s visit to China last week. The two parties also signed deals worth 2.4 billion USD. [The Economic Times]

China-EU relations: Working group to be formed to counter US unilateralism in trade

(dql) Responding to US unilateralist trade policy, China and the European Union agreed to set up a working group that will discuss an update of the World Trade Organization. The agreement was reached at a meeting between European Commission Vice-President Jyrki Katainen and Chinese Vice-Premier Liu He in Beijing. [ABC News]

Prior to the meeting, the EU announced tariffs on about 3.3 billion USD worth of US products, countering US President Donald Trump’s announcement of tariffs of 25 per cent on steel imports from Europe and 10 per cent on aluminium. China also retaliated last week with tariffs on 50 billion USD of US products following President Trump’s approval of tariffs on Chinese imports worth 50 billion USD. [South China Morning Post]

In a latest development of the China-US trade dispute, President Trump is reportedly considering measures to curb Chinese access to US technology, among them excluding  companies with at least 25 percent Chinese ownership from buying companies involved in U.S. tech and blocking additional technology exports to China. [CNBC]

Meanwhile, in a move further deepening its ties with Europe amid souring US-Europe relations, China during the visit of French Prime Minister Philippe to Beijing on Monday announced that it would buy more French farm products, indicated future purchases of Airbus aircraft and vowed to cooperate on market access in China. [Reuters]

In [Handelsblatt] former German Foreign Minister Joschka Fischer argues that China emerges as the sole winner out of the deterioration of US-Europe relationships and that Trump’s foreign and trade policies are paving the way to “Make China Great Again”.

Trump-Kim summit follow up: US, South Korea, Japan suspend ‘anti-Pyongyang’ military exercises

(dql) Following President Trump’s announcement to suspend US-South Korean joint military exercises at the summit with North Korean leader Kim Jong-un in Singapore earlier this month, the Pentagon announced that Washington and Seoul have indefinitely halted two marine exchange program training exercises scheduled to be conducted over the next three months. In an earlier move both sides stopped the planning of Freedom Guardian Exercise in which 17,500 American and more than 50,000 South Korean troops participated last year. [The Guardian]

In a related move, Japan suspended military exercises scheduled for this week and plans to suspend further nine civilian evacuation drills to prepare residents in Japan for possible missile attacks scheduled for later this year. Tokyo’s move is to be seen as major concession to open the door for direct talks with Pyongyang. While Kim Jong-un met leaders of China, South Korea and the United States in the recent past to discuss the de-nuclearization of the Korean peninsula, a summit with Prime Minister Abe has not been set yet. [CBS News]

De-nuclearization of the Korean Peninsula was also a topic at the summit between South Korean President Moon and Russian President Putin last week in Moscow. Moon reassured that his administration will “closely consult with the Russian government and work with it to completely and swiftly implement the outcome of the South-North Korean summit and the North Korea-US summit.” Furthermore, both sides agreed to work to initiate talks on a free trade agreement between both countries with a view to arrive at trade worth 30 billion USD by 2020, twice the turnover in 2017. [The Korea Herald]

A third summit between China and North Korea within less than three months last week reveals Beijing’s increasing efforts to play a key role in the geopolitics of the Korean Peninsula. During the talks with North Korean leader Kim Jong-un, Chinese President Xi Jinping reassured that “no matter how the international and regional situations change, the firm stance of the Communist Party of China and the Chinese government on consolidating and developing the relations with the DPRK remains unchanged.” [The Korea Times]

Meanwhile, North and South Korea held talks on connecting their railways across the inner-Korean border, the first on this issue since 10 years. The talks reflect growing efforts to implement longstanding envisioned economic cooperation between the two Koreas. However, to actually embark on economic cooperation would require the lifting of international sanctions imposed on North Korea over its nuclear and ballistic missile testing. [The Mainichi]

China: Military veterans’ protest violently dispersed by police

(dql) Armed police in eastern Jiangsu province violently cracked down a 5-day protest of thousands of PLA veterans who demanded improvement of their welfare rights. The protest, triggered by violent attacks on campaigning veterans in other parts of the country, sheds dim light on the struggle of China’s nearly 60 million former soldiers in the past years for better welfare and treatment in retirement. [South China Morning Post]

China’s ‘spying birds’: Signs of new heights of surveillance?

(dql) 30 military and government agencies have reportedly used high-tech birdlike drones over the past years for surveillance purposes in at least five provinces, with a focus on the far western Xinjiang Uyghur autonomous region considered by the Chinese government as hotbed for separatism. Equipped with a high-definition camera, GPS antenna, flight control system and data link with satellite communication capability, it is quite hard to detect these “bird bots” as they are able to replicate almost 90% of the movements of a real bird and produce very little noise. While their use is currently not widespread Chinese experts, involved in the design of these drones, express confidence that the technology will reach large-scale use in the future in a number of areas including police and military, emergency response and disaster relief, environmental protection and urban planning.  [South China Morning Post] 

Trump-Kim Summit: Takeaways and reactions

(dql) The much anticipated summit between US President Donald Trump and North Korean leader Kim Jong-un in Singapore concluded with a joint statement according which “President Trump committed to provide security guarantees to the DPRK and Chairman Kim Jong-un reaffirmed his firm and unwavering commitment to complete denuclearization of the Korean Peninsula.” [The New York Times for the full text of the statement]. Responding to questions at the press conference following the signing of the statement Trump further confirmed that while the sanctions against North Korea would remain for the time being, they would be taken off once “we are sure that the nucs are no longer a factor”. He also announced considerations of suspending the longstanding military drills with South Korea, calling them much to the surprise of the ally “expansive and provocative” “war games”. [Youtube]

The outcomes of the summit have been met with mixed reactions among North Korea’s neighboring powers. South Korea’s President Moon Jae-in hailed the summit as “historic event” that will “break down the last remaining Cold War legacy on earth” and “write a new chapter of peace and cooperation” between the two Koreas. [Yonhap] However, Trump’s statement on considering a halt of the joint annual military exercises caused much confusion in Seoul, as the exercises has traditionally been used as an instrument of deterrence and bargaining chip against North Korea. Following a meeting between US Secretary of State Mike Pompeo, President Moon and Gen. Vincent Brooks, commander of US Forces Korea, to verify “whether Trump’s reference to ‘war games’ meant the joint military exercises [The Korea Herald 1], a South Korean government source on Sunday announced that Seoul and Washington are expected to announce their decision to suspend large-scale combined military exercises in the days ahead. [The Korea Herald 2]

Japan’s Prime Minister Abe welcomed the statement as starting point of in the denuclearization of North Korea [Reuters] and signaled Japan’s support in bearing the cost of North Korea’s denuclearization under an international funding framework which. However, similar to South Korea, Tokyo appeared much irritated by Trump’s announcement on the halt of joint US-South Korean military exercises as such a shift would have huge impact on Japan’s national security and the role of Japan’s Self-Defense Forces. Trump’s announcement came especially as surprise after Japan’s head of the National Security Council in a meeting with Trump’s national security advisor John Bolton in Singapore was assured that the summit would not deal with the topic of U.S. troops based in South Korea. [Asahi Shimbun]

China, on the other side, was quick to point to its “positive and constructive role in getting the situation on the peninsula to where it is now” referring in particular to the suspension of US-South Korean joint military drills in exchange for North Korea’s stop of conducting nuclear and missile tests, proposed as ‘freeze for freeze’ initiative to the USA by China last year. [The Guardian]

Russia, meanwhile, stressed that the outcome of the meeting “needs to be thoroughly assessed”, but also welcomed the meeting itself as “beginning of a direct dialogue” with direct talks seen as only way for a political settlement. [TASS]

Analysts and experts cautioned against misplaced euphoria and optimism, stressing that the statement between Trump and Kim is vague and that only a follow-up negotiation process securing tangible results in term concrete steps, measures and timelines of the denuclearization process will make the summit a success. [CNBC] [East Asia Forum]

China’s crackdown on local governments’ compliance and creativity under Ji Xinping

(dql) Under the rule of President Xi Jinping China is undergoing not only a personalization of power but also a recentralization of administrative power leaving behind country’s decentralization experiment during the reform era to which much of the economic dynamism of the past three decades has been attributed to, William Weightman argues in [East Asia Forum].

Philippines & South China Sea: Cautious complaints against China

(ls) The Philippines have demanded that China stop confiscating the catch of Filipino fishermen in the disputed South China Sea, calling the practice “unacceptable”. China controls several reefs in the sea including Scarborough Shoal, which Beijing seized from Manila in 2012. The remarks by presidential spokesman Harry Roque were a rare public rebuke from Manila, which has taken a non-confrontational approach with Beijing. [South China Morning Post]

Meanwhile, acting Supreme Court Chief Justice Antonio Carpio has called on the government to bring China to court for violating the U.N. Convention on the Law of the Sea with the destruction of coral reefs in a disputed part of the South China Sea. He said the government should seek arbitration and compensation from China. In 2016, the Permanent Court of Arbitration in the Hague rejected China’s extensive claims in the South China and ruled that Scarborough Shoal was a traditional fishing ground of Filipino, Chinese and Vietnamese fishermen. [Reuters]

Thailand: Army chief visits China to deepen military ties

(ot) Army Chief and National Council for Peace and Order (NCPO) Secretary-General Chalermchai Sitthisart went on an official visit to China this week to discuss better military cooperation between the two countries, including the progress of the Thai government’s procurement of VT4 main battle tanks and VN1 armored personnel carriers from China. The countries have also agreed on defense industry cooperation as they plan to establish a weapons manufacturing and service in Thailand later this year. [Khaosod English, Matichon]

Mahatir: Opting for Japan, less for China?

(ls) Malaysia’s prime minister Mahatir was on a working trip to Tokyo which also involved a meeting with Japanese premier Shinzo Abe. The visit was also seen as a sign of Malaysia’s move away from China, which contentiously pumped billions of dollars into the scandal-tainted previous Najib Razak administration. Japan is Malaysia’s largest foreign direct investment contributor at $13 billion last year. But also ties with China peaked in the last few years after Beijing stepped in with a $2.3 billion deal to buy 1MDB assets. This was followed by several infrastructure projects which were won by Chinese state-linked firms. [Reuters]

While in Tokyo, Mahatir said when the “Look East Policy” was first formulated when he was prime minister back in the 1980s, it was not just about drawing investments from Japan or coming to study in this country, but also about “acquiring the Japanese work ethics, the Japanese sense of shame whenever they fail to deliver what they have promised to deliver”. [Bernama]

However, Mahathir also announced that he will review Malaysia’s membership in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (TP-11), the multilateral trade deal that was brokered under Japan’s leadership, after the United States withdrew from the original Trans-Pacific Partnership (TPP). Mahatir warned that weaker economies like Malaysia were at a disadvantage under the current terms. Nevertheless, in the unlikely event of a Malaysian pull-out of TPP-11, the treaty would remain in force as long as at least six countries have ratified it. [The Straits Times]

Anti-China protests in Vietnam

(ls) Anti-China protests erupted throughout Vietnam and more than 100 people were arrested after demonstrators stormed a provincial government building east of Ho Chi Minh City. As AiR reported last week, many were angry about a measure that would allow the leasing of land to foreigners for 99 years in three special economic zones. In an apparent response to the protests, the National Assembly announced to delay the adoption of the measures. [The New York Times]

The anti-China protests were the worst seen in Vietnam since 2014 when a Chinese oil rig was stationed in a disputed part of the South China Sea. The new protests are likely to aggravate the tense relations between the two countries. China’s embassy in Hanoi issued a safety warning to Chinese nationals. In April, the foreign ministers of both countries met in Hanoi and pledged to address their disputes peacefully, particularly those over contested territory in the South China Sea. [South China Morning Post 1]

Vietnam is among the most outspoken critics of Chinese construction and militarization of artificial islands in the Spratly island chain in the South China Sea’s disputed waters. However, an government spokesperson said, “It is not ruled out that the people’s patriotism was abused in order to cause public disorder.” [South China Morning Post 2]

China-US trade dispute: What goes around, comes around

(dql) China-US trade relations are further deteriorating over the escalating trade dispute. Following the Trump administration’s imposition of tariffs on 50 billion USD of imports from China, Beijing hit back and announced retaliatory tariffs on more than 600 US goods, worth the same amount. These tit-for-tat measures follow weeks of intense and ultimately failing negotiations between both sides on a trade agreement. [New York Magazine]

In another development related to the China-US trade dispute, the U.S. Supreme Court overruled a lower court decision that let two Chinese vitamin C manufacturers to escape 148 million USD in damages for violating American antitrust law. The justices ruled that the lower court gave too much deference to Chinese government filings explaining China’s regulatory policy. [CNBC]

China’s anti-graft campaign: Highest financial official pleaded guilty

(dql) The former chief of China’s now defunct Insurance Regulatory Commission has pleaded guilty of accepting bribes amounting to 3 million USD in return for help in securing contract, loan, and personal promotion approvals. He is the highest-ranking finance official to be convicted in the course of President Xi Jinping’s anti-graft campaign in the financial sector launched back in 2016. In another prominent case, a court in May sentenced the founder and former chairman of Anbang Insurance Group, China’s giant holding company with assets worth more than 300 billion USD, to 18 years imprisonment for fraud and embezzlement. [South China Morning Post]

Religion in China: Holy See and Beijing hold talks on bishop appointments amid increasing government interference in religious practice

(dql) Following inconclusive talks in March [AiR 1/4/2018], the Vatican and China this week held a new round of talks on the issue of the appointment of bishops widely believed to be the last stumbling block for an agreement which would pave the way for resuming diplomatic ties between both sides after a nearly 70-year breach following the Communist takeover in China. [Reuters] Results of the talks were not available at the time of writing.

The talks come amid growing concerns over tightening control of religious practice in China. Foreign missionaries are voicing worries about a widening campaign against the Christian community following the recent demolition of the major Way of the Cross pilgrimage site in a village in Henan province and the arrest two Koreans accused of ‘Korean Christian infiltration’.

The detentions take place against the background of amendments to the ‘Religious Affairs Regulation’ [China Law Translate for the regulation in English][State Council China, in Chinese], which came into force in February and allows tighter state oversight over affairs and practices of religious groups, and the adoption of a document, issued in April by Front Work Department of the Central Committee of the Chinese Communist Party (CCP), the Public Security Bureau and the State Administration for Religious Affairs, ordering intensified investigation and prosecution of Korean Christian organizations in China. In May more than 30 Japanese and Koreans believed to belong to foreign religious groups had been detained.  [South China Morning Post] [Bitter Winter]

Myanmar reviews $9bn China-backed port project on cost concerns

(jm) Myanmar’s concerns about the project of a Chinese backed port in Rakhine State grew up recently. This construction, which is part of the Belt and Road Initiative, is supposed to cost $9 billion but the Burmese government, fearing to default on its debt, is now negotiating with China to reduce the price. Lawmakers and government are afraid that the port could come under Chinese control if Myanmar fails to service its debt as it happened to Sri Lanka with the Hambantota’s port. An economist estimated that the amount of debt Myanmar would need to take on for this project would be around $2 billion, which means 3% of the country’s GDP. [Financial Times]

South China Sea: U.S. confronts China – ASEAN allies pursue a softer approach

(ls) The U.S. Air Force flew two bombers from a base in the Indian Ocean to near the South China Sea’s Spratly Islands this week. The flight by the two bombers is not the first in the South China Sea, but it came shortly after remarks by U.S. Secretary of Defense Jim Mattis in Singapore accusing China of “intimidation and coercion.” The move also came after Mattis oversaw the renaming of the U.S. Pacific Command to the Indo-Pacific Command last week, another symbolic gesture to underline the importance Washington affords to the region, as Ankit Panda writes in [The Diplomat].

The movement followed seven passages of U.S. naval vessels through the same sea since President Donald Trump took office in 2017. However, analysts believe that the U.S. military movement may challenge China without emboldening other countries, all with smaller armed forces than the People’s Liberation Army, unless Washington offers the others more naval cooperation or diplomatic and economic support. [Voice of America]

Prateek Joshi argues in the South China Morning Post that, whereas the U.S. expects India and other allies to play a greater role in confronting China in the South China Sea, the reality is that India and its maritime neighbours may have little to gain from this, taking into account the existing regional balance. [South China Morning Post]

Also, Collin Koh writes that ASEAN’s desire to maintain peace and stability is working to China’s advantage. Negotiations with Beijing on the proposed Code of Conduct in the South China Sea are expected to commence in August. In the same month, the inaugural ASEAN-China joint maritime exercise is scheduled to take place. Koh concludes that ASEAN is not about to rock the boat with Beijing. [Channel News Asia]

In the meantime, new analysis from an Israeli intelligence firm suggests that Chinese missile systems deployed to the Spratly and Paracel Islands may have been removed or relocated. Missile launchers and a radar system on Woody Island in the Paracel chain have disappeared. However, the U.S. has assessed that the missile systems have likely been concealed inside buildings. Another possible explanation could be that the missiles were not suited to deployment where they might be vulnerable to salt water damage, and therefore may have required replacement or repair. [CNN]

China-Laos relations: Laos’ president Bounnhang Vorachithh on state visit in Beijing

(ls) Chinese President Xi Jinping and Lao President Bounnhang Vorachithh met in Beijing to discuss the two communist countries’ future relations. They agreed to further cooperation in several aspects, among them the cooperation in major projects under the framework of the “Belt and Road” initiative. In terms of security cooperation, they agreed to enhance coordination and cooperation in multilateral mechanisms such as the United Nations, East Asia cooperation, and the Lancang-Mekong Cooperation, according to an official statement of the Chinese Ministry of Foreign Affairs. The Lao People’s Democratic Republic and the People’s Republic of China are long-time allies due to their similar political systems and ideology. [PRC Foreign Ministry]

Cross-Straits relations: Chinese invasion simulated in annual military drills

(dql) Amid strained Cross-Straits relations, Taiwan conducted this week its annual five-day live-fire Han Kuang military drill including anti-landing exercises with non-live-fire “strategic confrontations” simulating military actions in case of  an invasion of Chinese. [Focus Taiwan]

In a related move expected to spark Beijing’s anger, the US Senate Armed Services Committee has passed a draft bill calling for the participation on American troops the Han Kuang exercise. The bill follows previous recent passage of the a number of pro-Taiwan laws, among them the Taiwan Travel Act and the 2018 National Defense Authorization Act encouraging high-level official and military exchanges. [South China Morning Post]

China-Japan relations: Maritime security hotline launched

(dql) In a sign of a deepening rapprochement between China and Japan, both countries launched a communication mechanism between their defense authorities to prevent accidental clashes at sea and in the air. Besides the hotline, Beijing and Tokyo will host in turn annual senior official and expert-level meetings to monitor the system’s operation and technical problems.  Furthermore, both sides agreed that the Japanese Self-Defense Forces and the Chinese military will continue to abide by existing communications protocols between vessels and aircraft to prevent an escalation of tensions. [Kyodo News]

China-US relations: Ties remain strained over unsuccessful trade talks and hacked secret Navy warfare data

(dql) The relations between Beijing and Washington continue to be strained over trade issues after the latest round of negotiations led by US Secretary of Commerce Wilbur Ross and Chinese Vice President Liu He failed to reach a breakthrough in the dispute over the latest customs duties proposed by the Trump administration. [CBS News]

Further souring the relations, US officials confirmed that Chinese government hackers have been able to hack an US Navy contractor and secure sensitive undersea warfare data, including secret plans to develop a supersonic anti-ship missile to be used on US submarines by 2020. [The Washington Post]

Sino-Russian deepening relations: Xi and Putin celebrate close China-Russia ties amid growing cooperation within the Shanghai Cooperation Organization

(dql) Ahead of the Shanghai Cooperation Organisation Summit at the weekend, China and Russia on Friday concluded contracts for nuclear cooperation projects worth 3.13 billion USD and a 1 billion USD industrial investment fund. [South China Morning Post] On this occasion, Chinese President Xi and his Russian counterpart Putin reassured their pledge that their countries would support each other on key global issues. China’s state Xinhua News quotes Xi confirming “that the China-Russia comprehensive strategic partnership is mature, firm and solid” and that “[n]o matter how international situations change, China and Russia always firmly support each other in defending their respective core interests”. [Xinhua]

The demonstration of closing ranks between both countries facing strained relations with the USA was reinforced by Putin being the first to be presented friendship medal, China’s highest award for outstanding contributions of foreign experts to the economic and social progress of the country. [The Straits Times]

The concord between Beijing and Moscow who are jointly leading the Shanghai Cooperation Organization stands in stark contrast to the disunity displayed between US President Trump and the other leaders over at the G7 summit on Friday and Saturday culminating in Trump’s rejection to endorse an joint communique on trade, environment and the Iran nuclear deal after the seven leaders appeared to have agreed on such a communique. [Deutsche Welle]

In a latest development reflecting growing cooperation between member states of the Shanghai Cooperation Organization (China, India, Kazahkstan, Kyrgyzstan, Pakistan, Russia, Tajikistan, Uzbekistan), China and India signed two MoUs at the sidelines of the Shanghai Cooperation Organization Summit, under which China agrees to share hydrological data of the Brahmaputra River, whose origin is in Tibet, to predict floods and to import non-Basmati rice from India, a step which increases India’s share on the Chinese (the world’s largest) rice market and expected to decrease the ballooning trade deficit with China. [Financial Express]

Furthermore, India earlier this week reiterated that it will continue to push for the purchase of Russian-made S-400 Triumf advanced Air Defense Systems despite possible US punitive actions following the US Countering America’s Adversaries Through Sanctions Act (CAATSA) which punishes countries and entities engaged in transactions with the defence or intelligence establishment of Russia. [The Diplomat]

This reassurance of Indian-Russian cooperation comes a few weeks after the summit between Prime Minister Modi and President Putin at which they agreed “that the Special and Privileged Strategic Partnership between India and Russia is an important factor for global peace and stability” and that both countries “recognised each other’s respective roles as major powers with common responsibilities for maintaining global peace and stability.” [The Quint]

China: Remembering Tiananmen protest 1989

(dql) Tens of thousands of people gathered on 4 June in Hong Kong for a vigil to mark the 29th anniversary of the military crackdown against the student-led reform protest at Tiananmen Square. In contrast, in the rest of mainland China activities to remember the crackdown are banned and postings are scrupped from social media. [The New York Times]

In a related move, the police raided a southwestern underground church in Sichuan which was preparing a service to commemorate the Tiananmen crackdown. [South China Morning Post]

For an account on the human rights situation of human rights lawyers, autonomous labor groups, and underground churches in China under Xi Jinping see the article in [The Jamestown Foundation: China Brief] emphasizing that while all three groups were enjoyed some space to operate under the Hu Jintao administration, they have been considered threats to the rule of the Communist Party within the frame of Xi Jinping’s  crackdown on organization and expression and treated accordingly.

India: Asserting its role based on ‘strategic autonomy’ and with a view on multi-polarity

(hg) After his cordial words to President Putin in Moscow last week, Indian Prime Minister Narendra Modi has now stressed in Singapore that India’s principle of “strategic autonomy” remains strong. Drawing an equivalence in ties with Russia, the U.S. and China, he cautioning against a “return to the age of great power rivalries” when giving his keynote address at the opening of the 17th Asian Security Summit of the IISS Shangri-La Dialogue in Singapore. [The Hindu]

On India´s “Indo-Pacific” strategy which is often seen as a platform to contain China’s expansion Modi stressed a vision for an inclusive Indo-Pacific and highlighted the relationship between India and China as key to a positive future in the region: “I firmly believe that Asia and the world will have a better future when India and China work together in trust and confidence, sensitive to each other’s interests.” Acknowledging geopolitical competition, Modi also maintained that bilateral cooperation between India and China is expanding. [CNBC]

Referring to relations between his country and other great powers like Russia, the US, and China, Modi made clear that he believed India, like Singapore didn’t stand “behind one power or the other” to reiterate “President Putin and I shared our views on the need for a strong multi-polar world order for dealing with the challenges of our times”. He added however, “At the same time, India’s global strategic partnership with the United States has overcome the hesitations of history and continues to deepen across the extraordinary breadth of our relationship”. [The Hindu] 

In context of the Shangri-La Dialogue, Indian Prime Minister Modi has also taken some foreign policy and security steps in relation to Southeast Asia in recent days. With Indonesia he signed an agreement to develop the port of Sabang that overlook the western entrance to the Strait of Malacca. With Singapore he concluded an agreement on logistical support for Indian naval ships, submarines and military aircraft during visits. With newly elected Malaysian Prime Minister Mahathir Mohamad who has been critical of Chinese influence in Malaysia he held talks, altogether cemented ties with three strategically important ASEAN member states.

But India’s envisioned footprint is supposed to be wider. Last month, three Indian warships staged exercises with the Vietnamese navy for the first time in the South China Sea, which is claimed almost wholly by China. Moreover, Vietnamese submariners are trained in India, while both countries have increased intelligence sharing and expressed commitments to expand weapons sales. Before, India signed an agreement for access to the port of Duqm on Oman’s southern coast, which increases the Indian navy´s operational capabilities in the western Indian Ocean. [Reuters]

Meanwhile, India has successfully test-fired its indigenously developed nuclear capable long range ballistic Agni-5 surface-to-surface missile with its strike range of 5,000 km for the sixth time. [Money Control]

US Pacific Command changed in US Indo-Pacific Command as a nod to India

(ot/am) The United States military has renamed its oldest and largest military command, the Pacific Command, to US Indo-Pacific Command in a largely symbolic move underscoring the growing importance of India to the Pentagon. The unit, formed after World War II, is responsible for all US military activities in the greater Pacific region with about 375,000 civilian and military personnel.

Speaking during a change-of-command ceremony with Admiral Philip Davidson assuming leadership of the command from Admiral Harry Harris, who is US President Donald Trump’s nominee to be ambassador to South Korea, US Defence Secretary Jim Mattis said: “In recognition of the increasing connectivity between the Indian and Pacific Oceans, today (May 31) we rename the US Pacific Command to US Indo-Pacific Command.” [South China Morning Post]

He added: “Relationships with our Pacific and Indian Ocean allies and partners have proven critical to maintaining regional stability.”

The US which is trying to get a foothold in India’s large defense market and to counter China’s emerging power across the Indo-Pacific domain. In response to the renaming, Chinese defense ministry spokesman announced its awareness. [Al Jazeera] [Channel News Asia]

Sri Lanka: free trade, foreign investment and Chinese, Indian, US competition

(jm/hg) Sri Lanka seems to have difficulties to find the right formula in defining its free trade activities with China and, to a much lesser degree, also with India.

China has given loans and invested billions of dollars to build ports, roads and power stations across the country as part of its Belt and Road Initiative. Against the background of some political volatility, concerns have grown in recent months that the 21 million people nation might develop even deeper into debt which might finally undermine its political independence. After ten years, Sri Lanka wants now to review its free trade pact with China amid a big trade deficit with Beijing, which, however, seems to not agree on that. Talks have come to a standstill as Sri Lanka wants a review clause that would allow it to change some of the deal´s terms if they are hurting national businesses which is refused by China. Another bone of contention are tariffs. While China wants zero tariffs on 90 percent of goods the two countries sold to each other, Colombo wants rather to start with zero tariffs on only half of the products concerned and to be expanded gradually over 20 years. Currently, Colombo is separately negotiating a trade pact also with India where it faces also difficulties of how to prevent detrimental competition from a flood of cheap goods made by India. [Reuters]

These difficulties and popular resistance notwithstanding, Chinese influence is growing while there is also more to bilateral relations than just the fact that Sri Lanka is integrated in the BRI. China has politically supported Sri Lanka in the last phase of its severe civil war when it positively responded to then Prime Minister Rajapaksa´s request to provide both weapons and diplomatic cover when Western countries focused on Sri Lanka’s deteriorating human rights record. [South China Morning Post]

In this situation, a bipartisan group of notably influential US lawmakers has visited Sri Lanka to gauge the ground-level situation of Chinese investment in Sri Lanka’s infrastructure. The delegation, which is headed by Congressman Mac Thornberry, Chairman of the powerful House Armed Services Committee, visited extensive infrastructure projects financed by loans from China and managed by Chinese companies. [Ada Derana]

Giving reference to the purpose of the visit, Thornberry said that it was clear that the strategic value of Sri Lanka was not lost on China.

The delegation met Sri Lankan President Sirisena, Prime Minister Wickremesinghe, Parliament Speaker Jayasuriya and Opposition Leader Sampanthan along with Tamil National Alliance leaders. Thornberry emphasized the shared values of democracy, rule of law and freedom of the seas and said: “One cannot overstate how important it is that a prosperous, stable democracy hold this strategic ground.” [Ada Derana]

Meanwhile, Richard D Fisher, Senior fellow at International Assessment and Strategy Centre, told members of the House Select Intelligence Committee during a hearing on ‘China’s Worldwide Military Expansion’ that the Chinese economic and ‘debt trap’ pressures will likely result in China gaining greater access to bases in Sri Lanka, Pakistan, Bangladesh and perhaps the Maldives. [Ada Derana]

Malaysia scraps Singapore rail link project. More to come?

(jk) The new Malaysian PM has announced that under his government, the previously planned highs-speed rail link that was supposed to link Malaysia and Singapore will not go ahead as planned. Mahathir told reporters last week that the project is not beneficial to Malaysia and has a too heavy price tag.

The move could signal a shift in Malaysia’s position towards other big infrastructure projects as well, in particular towards the Chinese Belt and Road initiative, of which former PM Najib was a great proponent. China’s state-run tabloid, the Global Times has already reacted to the announcement by issuing a warning that Malaysia would be the one who had to pay the price if they were not to honour contracts. [Global Times]

PM Mahathir in the meantime has signalled that he wants to renegotiate some deals made with China before he was elected. [Straits Times 1] It is difficult to foresee at this stage how far these renegotiations may go. It is possible that we will see cosmetic changes with most of the current projects remaining more or less untouched.

Huge Chinese investments were made into Malaysia amidst the 1MDB crisis which eventually toppled former PM Najib. 1MBD was created in order to promote economic development, but its debt skyrocketed in 2014 before it was rescued by a Chinese SOE of the energy sector. Shortly after, Malaysia increased approval of China’s Belt and Road infrastructure projects which are now viewed with mounting suspicion. A number of projects has been given to Chinese firms without even considering other international offers, such as the East Coast Rail link, associated with huge construction cost. The new PM is not done looking into infrastructure projects. In the meantime, the noose around the neck of Najib is tightening with Malaysia and Singapore operating together to investigate the scandal. In addition, at least 6 nations are investigating in the matter, including the United States and Switzerland. [Straits Times 2]

Japan-US-Australian anti-China agreement on maritime security in the South China Sea

(dql) At the IISS Shangri-La Summit this weekend in Singapore the Defence Ministers of Japan, the USA and Australia announced their agreement to cooperate in dealing with any attempt to unilaterally change the status quo in the South China Sea. The agreement includes working out a strategic action agenda providing maritime security guidelines for the three countries. [The Japan Times]

In a related move, US Defense Secretary Mattis, speaking at the summit, warned against China’s intentions of intimidation and coercion while referring to China’s recent deployment of military hardware in the South China Sea. [BBC News] For an account of the concretization of ‘China’s amphibious ambitions’ in the South China Sea see [Asia Times].

In a latest US move to counter China’s assertiveness in the South China Sea, two US warships this week sailed near islands claimed by China. [The Guardian]

China-US trade dispute: New round of escalation

(dql) The US-China trade dispute was renewed this week after Washington declared that, despite the ‘tariff ceasefire’ agreed on between both sides the week before [CNN], still plans to implement a 25% tariff on Chinese products worth 50 billion USD. China vowed to respond with countermeasures if the USA goes ahead with announced tariff plans. [Bloomberg]

China concerns trigger comprehensive intelligence revamp in Australia

(am) Australian spy agencies will undergo their largest review in decades as Canberra seeks to strengthen intelligence powers amid heightened concerns about terrorism and foreign political interference, especially from China. A former head of the Australian Security Intelligence Organisation (ASIO) will spearhead the wide-ranging inquiry. It will look at how national and domestic intelligence agencies cooperate, assess their resources and review the laws that underpin their work. [South China Morning Post]

Sino-Russian relations: Deepening military and strategic cooperation

(dql) At the 20th round of strategic consultation between China and Russia this week both sides agreed to “further enhance the level of bilateral military cooperation and make positive efforts to help the strategic cooperation between the two militaries to take new steps in the new stage”. The statement is the latest in a string of statements stressing the common strategic interests and deepening ties between China and Russia in the recent past in the face of the 2018 US National Security Strategy which labels both countries as strategic competitor of the US and revisionist powers challenging American power, influence and interests. [Newsweek]

China: Opening up to attract foreign investment

(am) China will roll out more foreign investor-friendly measures to further boost opening-up and economic upgrading.

Commitments to cancel or ease restrictions on foreign investment in such manufacturing sectors as automobiles, shipping vessels, and aircraft shall be promptly implemented.

The mechanism regarding qualified overseas investors will be expanded to encourage overseas investors to participate in the future trading of crude oil and iron ore and give more support to foreign-invested financial institutions in underwriting local government bonds. [Xinhua]

China: 6 out of world’s top 100 universities

(am) The Times Higher Education (THE) ranking revealed its World Reputation Rankings 2018, in which Chinese mainland claims six of world’s 100 most prestigious universities, while Hong Kong and Taiwan have three universities and one university in the rankings respectively.

Tsinghua University and Peking University are in 14th and 17th place respectively, both equaling their 2017 positions. The other four universities from Chinese Mainland that made it into the top 100 are Zhejiang University, Fudan University, University of Science and Technology of China and Shanghai Jiao Tong University. [Xinhua]

More than 1000 march in Hong Kong to remember June 4 Tiananmen Square crackdown

(am) More than 1,000 Hongkongers took to the streets amid a record-breaking heatwave on last Sunday to take their yearly stand to “resist authoritarianism” ahead of the 29th anniversary of the Chinese military’s bloody June 4 crackdown in Beijing’s Tiananmen Square.

“Human rights, freedom, democracy and justice have continued to deteriorate” in mainland China, said Richard Tsoi Yiu-cheong, representing the Alliance in Support of Patriotic Democratic Movements of China, the march organiser. [South China Morning Post]

China: Further tightening the Party’s control over religious affairs?

(dql) The Communist Party’s United Front Work Department issued a directive according to which local authorities are ordered to “make the regulation of the construction of large outdoor religious statues their top priority to prevent further commercialization of Buddhism and Taoism”. [Directive in Chinese]

The directive has met mixed assessments. While some analysts stress that the directive is a measure to tackle over-commercialization of religion in China [The Economic Times], other see the directive as embedded in the Chinese government’s comprehensive efforts to tighten control over religious affairs as part of the overall agenda of establishing pervasive control of state and society. [The New York Times/AP]

Myanmar: Chinese special envoy meets with ethnic groups over violent clashes at the border

(jm) Since an attack led by the Ta’ang National Liberation Army (TNLA) occurred last week at the China-Myanmar border, pushing several civilians to flee out of Myanmar, China seems to have taken a more active role.

After meeting an umbrella organization bringing together several ethnic groups, asking them not to arm themselves, and calling the Northern Alliance armed ethnic groups (which include the TNLA) to participate in the next session of the 21st Century Panglong Conference, China’s special envoy on Asian Affairs met State Counsellor Daw Aung San Suu Kyi and a senior Tatmadaw chief on Tuesday. The talks mostly addressed the peace-process in Myanmar and the relations between the state and the ethnic groups. [Myanmar Times 1] [Myanmar Times 2]

The third round of the 21st Century Panglong Conference that was supposed to be held by the end of month will be delayed. The event is scheduled twice a year, but the last round took place one year ago. [Eleven Myanmar]

Pakistan in need of Chinese loans?

(ot) Pakistan seems to seek Chinese state loans worth $1-2 billion USD to avert a balance of payments crisis after having taken already billion – dollar loans from China and having just received a $1 billion loan by a group of Chinese commercial banks in April. Meanwhile, China’s BRI investment China-Pakistan Economic Corridor (CPEC) runs up to $57 billion USD. [The Economic Times]

Pakistan: SCO anti-terrorism summit held in Islamabad, while President Xi calls for regional security operations

(ot) Pakistan hosted the Shanghai Cooperation Organization (SCO) Regional Anti-Terrorist Structure (RATS) meeting after having become a member of SCO last year. Participants included legal experts from China, Kazakhstan, Kyrgyzstan, India, Russia, Tajikistan, Uzbekistan, and Pakistan. [Geo TV]

Meanwhile, the 13th meeting of Security Council Secretaries of the SCO member states was held in Beijing, addressed by President Xi Jinping stressing the importance of last year´s entry of both India and Pakistan as new SCO members.

In the context of a steady confluence of Asia, the recent SCO meetings reflect the potential of still nascent attempts to foster regional diplomatic arenas in a multipolar global governance order. [The Economic Times]

Taiwan once again not invited to observe World Health Assembly and other “Orwellian nonsense”

(jk) The World Health Assembly (WHA) is the the World Health Organization’s (WHO) decision making body and the world’s highest health policy apparatus composed of health ministers from member states and number of “observers”. These have from 2009 to 2016 included the Republic of China (Taiwan). For the second year in a row, Taiwan’s Ministry of Foreign Affairs had to release a press statement that the WHO has failed to invite Taipei. The assembly took place this past week in Geneva, Switzerland.

CPG Senior Research Associate Kerry Gershaneck is arguing in an opinion piece [The Nation] that this is the result of distinct political pressuring from Beijing, who’s leaders are looking to incrementally increase pressure and isolate Taiwan diplomatically in spite of the latter’s significant contribution to international public health.

China in the meantime is celebrating the exclusion of Taiwan as a success and take this as a sign that the Chinese “One China Principle” is now widely accepted. They assert that the ‘fault’ of not being invited lies firmly with the current government in Taipei who have not officially and fully embraced the “1992 consensus” and complicate “peaceful and stable cross-Strait relations” [China Daily].

The EU, US and other countries including New Zeeland and Canada have spoken out in support of Taiwanese participation and warned against the politicisation of international public health.

In related news, recent pressure by Beijing on businesses to explicitly treat Taiwan as a part of China is continuing and seen to have clear effects despite the US embassy’s call to stand firm against this kind of “Orwellian nonsense”. Associated Press has found that 20 airlines, including for example German, Canadian and British carriers now refer to Taiwan as part of China on their international websites. A very notable exception to this is currently Chinese national carrier Air China which on its US site, lists Taipei part of “Taiwan, China” but also has a Taiwan website on which it says “Taipei, Taiwan” [South China Morning Post].

Other businesses have publicly apologised to China for referring to Taiwan as a country, including clothing retailer GAP and Zara, medical equipment maker Medtronic as well as hospitality company Marriott International. The latest retailer in the spotlight was Japanese firm “Muji” which was orderd to pay a fine using packaging in China which listed the “country of origin” as Taiwan [Reuters].

Taiwan’s international position has further been weakened by the decision of Burkina Faso to cancel its official diplomatic recognition of Taiwan, as some other former diplomatic allies of Taiwan have done recently. The move leaves Taiwan with only 18 official diplomatic allies across the world, including now only one African country (Swaziland), and it has led Taiwan’s foreign minister to take responsibility and resign from his position. [Focus Taiwan]

Merkel’s China visit

(jk) German Chancellor Angela Merkel has met Chinese Premier Li Keqiang and President Xi in Beijing and discussed global free trade as well as pointed to a lack of reciprocity in each other’s market access. Major German companies, who’s leaders accompanied Merkel on her journey, have complained about increasing difficulties, particularly in terms of investment and forced technology transfer. While market access and economic relations dictate much of the agenda, human rights issues were also mentioned by Merkel but as in previous years, there is little room to manoeuvre on these issues. German concerns over 16+1 – a grouping of 16 central and eastern European countries led by China – were also addressed.  China’s leaders said they supported a united EU and there was no pressuring of smaller member states through which China is trying to influence policies of the EU. To increase transparency and alleviate concerns, representatives from the EU will be invited to attend 16+1 meetings. [Süddeutsche Zeitung in German; South China Morning Post]

China, the Philippines, Vietnam and the South China Sea

(ls) A spokesman for Philippines President Rodrigo Duterte voiced “very serious concern” over reports that China has landed long-range bombers on its islands in the disputed South China Sea. The foreign ministry said it is taking “appropriate”, but low-key, diplomatic action to protect the country’s claims and to continue to do so in the future. The Philippines did not condemn China’s action “to avoid any drawbacks and challenges”. [The Straits Times]

Facing criticism over his apparent inaction, Duterte questioned where his country would end up should war erupt in the region. “What will we arm ourselves with if there’s a war? (…) How will we even fight with the Chinese?” Instead, he emphasized his goal to forge a joint exploration pact with China to harness the disputed sea’s potential. [Bloomberg]

Debasish Roy Chowdhury describes in the South China Morning Post how Duterte’s popularity has held so far but if it starts to give way, the opposition and the military brass may start mounting pressure to confront Beijing. Duterte is left with little room to maneuver in the face of China’s military capabilities. If China gets too aggressive, however, Manila may turn more and more to the US for support. [South China Morning Post]

At the start of his administration, Duterte threatened to scrap defense treaties with the US in favor of closer ties with China and perhaps Russia. However, as Rappler writes, alliances among militaries, especially one as longstanding as the Philippines and the US, cannot be broken or built overnight. It takes years or decades to synchronize tactics, techniques, and procedures to achieve interoperability. According to military analysts, there have been “cosmetic” but no significant changes in the country’s ties with the US military. Cooperation during the siege of Marawi put this on display. [Rappler]

China’s and Vietnam’s opposing interests in the South China Sea are becoming more and more visible as well. Last week, Rosneft Vietnam BV, a unit of Russian state oil firm Rosneft, was concerned its recent drilling in one such block could upset Beijing. Vietnam’s foreign ministry responded asserting that the blocks are “entirely under Vietnamese sovereignty and jurisdiction”, whereas Beijing warned to respect its sovereign rights. China’s claims in the South China Sea overlap the exclusive economic zones of Vietnam, the Philippines, Malaysia and Brunei. If China’s nine dashes were connected as one continuous line, it would bisect or incorporate 67 of Vietnam’s oil blocks. [Reuters]

In the face of such tensions, Vietnam has reinforced cooperation with Australia. Vietnamese President Tran Dai Quang and Australian Governor-General Peter Cosgrove agreed to boost cooperation to maintain peace in the region. “The two nations are on the same side about disputed issues in the East Sea and will work together to initiate the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP),” President Quang said. [VN Express]

More on the new People’s Liberation Army Navy (PLAN) – Australian perspective

(jk) The Australian National University’s Strategic and Defence Studies Centre has published a new report in its Centre of Gravity essay series, titled China’s New Navy: A Short Guide for Australian Policy-Makers. In addition to policy recommendations and implications in the Australian context, the report describes huge capability leaps China has made. It finds that while China’s maritime modernisation was previously focussed on capabilities making it difficult for the US and its allies to operate close to China, it is now also about signalling Beijing’s status as a great power and its ability to pressure neighbouring countries. It says that America’s naval predominance will be replaced by a multipolar balance in North Asia, while Southeast Asia will be dominated by the PRC.

Australia ought to plan for a future in which its major ally is not the uncontested maritime leader in the region, and in fact take a leaf out of the Chinese playbook and focus its maritime force structure on anti-access and area denial capabilities. [Australian National University]

PRC Maritime Activity / PLA Navy Disinvited from RIMPAC

(jk) The U.S. Defense Department disinvited China from the forthcoming Rim of the Pacific (RIMPAC) exercise due to strong evidence of militarisation in the South China Sea. The message broke as Chinese Foreign Minister Wang Yi was on a visit to Washington. The DoD lamented that the PRC had deployed anti-ship missiles, surface-to-air missile systems, and electronic jammers to contested features in the Spratly Islands. Moreover, China has landed nuclear capable bomber aircraft at Woody Island in a move that further cements the US PACOM’s belief that China is now capable of controlling the SCS in all scenarios short of a war with the US [Independent]. Shortly after the news of the bomber aircraft became known, China’s Coast Guard conducted their first joint patrol with the PLAN and expelled foreign ships from the water around the disputed Paracel Islands. The move is seen as a warning to Vietnam after a Vietnamese subsidiary of Russian oil firm Rosneft had started drilling in the area [South China Morning Post]. Vietnam also claims that Chinese ships have regularly “invaded” Vietnamese waters over the past few months and sometimes fished (accompanied by special forces) only 30 or 40 nautical miles off Vietnam’s coast [VN Express].

“Hawkish” US China observers welcome the decision as more and more concerning Chinese behaviour in the SCS is lamented by them. Some see the actions of the PLAN and its global strategy as a clear pathway to creating a whole new global order. The US House Intelligence Committee has recently heard that the Chinese Navy could in 12 years be twice the size of its US counterpart and that, according to the presenting expert, “the strategic balance has shifted in the PRC’s favor and against America’s security and interests”. He goes much further in stating that the “PLA Navy is China’s point of the spear in its quest for global hegemony“. [US House – for full testimony]

Global hegemony or not, it is far less controversial that many of Beijing’s moves stand in clear violation of China’s promise not to further militarise the SCS and the DoD has called on China to remove the military systems immediately and to reverse course on the militarization of disputed SCS features. As for RIMPAC, China has taken part in the biannual exercises in 2014 and 2016, but recent aggression on their behalf led the US authorities to withdraw the invitation for 2018. [The Washington Post]

This is a strong signal that has been sent to Beijing and a clear sign of a push back against Chinese behaviour in the SCS. However, previous countries that had been disinvited, e.g. Russia in 2016 following the annexation of Crimea, had sent (spy) ships to observe the exercises anyway so it is possible that China will follow a similar strategy. It also has to be considered that President Trump may re-invite the PRC to the exercises, given his history on sharp turnarounds on foreign policy matters. This week’s news on the DPRK summit are just one more example of this.

For some very well done visual input on how China has changed realities in the SCS over the past few years, do check out this excellent infographic page by [Reuters].

Eurasia: Shifting geopolitical realities from Europe over Russia to India

(hg) After President Trump´s withdrawal from the Iran nuclear deal, the US is dramatically losing geopolitical ground in Europe and Asia over the past weeks.

Clearest indicator of a revered trend is Russia´s international position after staunch US ally UK hastily built an anti – Russia alliance after the Skripal spy affair, the poisoning of the former British spy Sergei Skripal in Salisbury in March. The US, UK and French attacks on Syria for the alleged use of gas against civilians by the Syrian government which is militarily supported by Russia and Iran, reinforced this front with the concerted Western response resembling Cold War times.

Surprisingly quick though, this situation took a drastic turn with the international response to the US announcement to leave the Iran nuclear deal and its threats to impose massive sanctions against Iran. All other partners to the deal immediately declared to still support it, including France and Germany triggering also a rethinking of their relations with Russia and China, also partners to the nuclear deal. Against this background, recent trips of German Chancellor Angela Merkel and French President Emmanuel Macron to Russia represent a switch in their engagement with Moscow.

After Chancellor Merkel had what might be described a ‘rational discourse’ with President Putin in Moscow, French President Macron even topped that with demonstratively cordial manners when meeting Putin last week.

That is was more than just a nice façade is evidenced by France’s Total sealing a gas deal with Russian Novatek, owned by Putin’s friend Gennady Timchenko, at the St Petersburg Economic Forum at the same time. [NPR] – Not accidently, Total is currently threatened by possible US sanctions concerning its $2 billion investment in the Iranian South Pars gas field.

Moreover, the Saint Petersburg International Economic Forum was a success in other regards as well. After all, President Putin could gather French President Macron together with Japanese Prime Minister Shinzo Abe and Managing Director of the International Monetary Fund (IMF) Christine Lagarde at a plenary session of the forum demonstrating that he is back on the international stage.

An important message for Prime Minister Abe was Putin´s proposal to jointly look for a solution that would allow Japan and Russia to finally conclude a World War II peace treaty. [Euronews] In context of Abe´s visit to Russia the Japanese Minister for Economy, Trade and Industry highlighted Russia-Japan economic ties had gained an unprecedented momentum. [TASS].

Most important however, is the conspicuous re-affirmation of Indian – Russian friendship on occasion of an informal summit between Indian Prime Minister Narendra Modi and Putin.

Pictures of the meeting that are telling of a fully relaxed and cordial atmosphere between the two leaders are underscored by Modi´s message to Putin: “Russia is India’s old-time friend. We share long-standing historical ties, and Mr. President is my personal friend and a friend of India” added by the affirmation: “For the past four years, you and I stood side by side in the bilateral format and on the international stage … I am very glad that it was so.”

For President Trump, this affirmation of Indian – Russian friendship counts as a double punch. First, after having engaged Russia internationally in a decisive zero-sum game manner, Russia re-gaining an important friend means an according loss for Trump. Second, the US have to fear to lose a cornerstone of their own strategy to consolidate Asia´s geopolitical order against China. At least at the moment, a firm anti-China front seems to be only wishful thinking after month of promising developments. Now, after especially India seemed to have decisively turned towards the US and Putin having been almost isolated internationally, the situation changed since the escalation of the Skripal affair, followed by more aggressive US policies on trade and Iran.

Before visiting Moscow, the Indian Prime Minister hold informal talks with Chinese President Xi Jinping as well due to which both leaders relaxed bilateral relations, showing also that Delhi sided with China in the emerging shadow trade war with the US. Now, India is demonstrating that it wants to continue its partnerships with both Russia and Iran. Ties with Russia represent a long-standing and robust relationship of neighbouring countries with India having extensive energy and defence relationship with Russia. Russian and Indian economic ties have just experienced a highlight last year with the biggest foreign acquisition ever in India when Russian oil major Rosneft closed a $12.9bn purchase of Indian refiner Essar Oil. Diplomatically, Russia has also facilitated India’s membership in the Shanghai Cooperation Organisation and endorsed its demand for a permanent seat at the UN Security Council. Similar to Russia, Iran is another old friend of Delhi which has strong strategic interest to keep this friendship. [Al Jazeera 1]

While India will probably try to not let its friendship to Russia and Iran impact the more nascent ties with the US, the US seem not to have priority for India anymore. In other words: If the US is actually pursuing its relationship to India as a zero-sum-game regarding Iran and Russia, Delhi cannot be expected to side with Washington.

The general picture indicates that US foreign policy under President Trump  and National Security Advisor Bolton seems to have overplayed its – originally favourable – hand, exerting too early too much pressure on too many allies on too unpredicted terms.

A first fissure emerged in the wake of the Skripal affair whose handling prompted China to explicitly side with Russia at the April security conference in Moscow where the Chinese defense minister unanticipatedly declared effectively military solidarity with Russia in direction of Washington. India´s defence minister acknowledged at the same occasion that “Russia has re-established its role and influence in global strategic and defence matters”, a remark that implied appreciation for the Russian role in Syria.

Then came both the withdrawal of the US from the Iran nuclear deal and the increasingly aggressive US trade policy. In its wake, India is facing hefty import tariffs while sanctions on Iran upset India’s relations with Tehran, including its operations and investments at a strategic port project in Iran. Currently, Delhi is still waiting for an exemption from higher tariffs on steel and aluminium imports to the US which is also imposing tougher visa rules that target India’s information technology industry. [Al Jazeera 1]

At the same, India felt its new friend´s pressure already when dealing with Russia over the acquisition of the state-of-the-art S-400 missile defence system facing the threat by the US Countering America’s Adversaries Through Sanctions Act.

The chief of India’s national security advisory board and former Indian envoy to Russia analysed the situation as follows: “We are witness to a very acrimonious standoff between the US and Russia which has gone on to levels that didn’t prevail even during the Cold War. These anti-Russia sanctions have an extra-territorial applicability – this draws in everybody”. [Al Jazeera 1]

Currently, India is obviously rethinking its foreign policy and in the meanwhile walking a tightrope between Moscow and Washington, that might soon be ended to the disadvantage of India – US ties. That, however, could contribute to a sustaining revival of the BRICS – the association of Brazil, Russia, India, China and South Africa – plus Iran.

 Anyway, a next step in Indian – Russian relationships is a mega economic Summit of 100 CEOs as a follow up of Prime Minister Modi´s to Sochi. [The Economic Times]

Meanwhile, Russia´s position in Europe is also improving with strategic projects such as the Nord Stream 2 pipeline running under the Baltic Sea and TurkStream crossing the Black Sea both advancing. Both Germany and Turkey, Gazprom’s most significant customers, seems to resist pressure from the Trump administration to refrain from the pipeline projects.

Additionally, the European Commission has ruled in an anti-trust case against Gazprom which looks favourable for both sides. While Gazprom had to bow to Brussels’ conditions, the Commission eventually accepted a settlement offer instead of imposing a hefty penalty which could have been as high as 10 percent of Gazprom’s turnover as the Commission did with Google which was handed out a record-breaking 2.4 billion-euro fine for violating the EU’s anti-trust law. [Al Jazeera 2]

Moreover, Russia’s economy seems to be better than casual observers might expect regarding tough sanctions and a political isolation that, however, seems to run to be markedly softened. For Russia, the major economic risk would be a sharp drop in global energy prices, which are on the one hand currently on the upswing while a drop would also hit major US ally Saudi Arabia severely. [CNBC]

The upcoming World Cup in Russia might also turn out to further stabilize the positive trend for Russia with President Macron having already announced to come to Russia if the French team makes it to the final. These changes notwithstanding, there is serious pressure on Russia remaining. Besides the US, this pressure is mainly driven by the UK with her majesty’s foreign secretary having even compared the Russian World Cup with Hitler’s 1936 Olympics.

Earlier this month it was reported that the UK plans to use four major summits – those of the G7, G20, NATO and EU – to deepen the UK/US led alliance against Russia. Calling Russia’s response to the gas attacks in Syria and Salisbury a turning point that warrants a broad Russian containment strategy, aim of the British advancement is a comprehensive strategy and to urge a rethink over traditional diplomatic dialogue with Moscow. [The Guardian]. If the UK will continue with this plan remains to be seen, a great deal of its momentum is currently gone.

British politicians are, however, not alone in claiming Russia would make traditional diplomacy ineffective. They are especially supported by some Eastern European governments such as Poland or some Baltic politicians. [The Guardian]

While the debate over the claimed Russian or Syrian responsibility for the gas attacks in Salisbury and Douma is silting and convincing evidence still lacking, the Netherlands and Australia have just accused Russia of being directly responsible for the downing of the Malaysia Airlines Flight 17 which was shot in 2014 over the Ukraine. Moreover, putting some real pressure on Russia, NATO is advancing two exercises “Atlantic resolve” and “Sabre Strike” that will improve interoperability of NATO forces and serve NATO’s deterrence mission towards Russia. ‘Saber Strike’ is an annual, U.S. Army Europe-led cooperative training exercise focusing at te Baltic states that will take place in multiple locations throughout Estonia, Latvia, Lithuania and Poland May 28-June 24. This year, 11,000 U.S. and NATO military members from 20 countries will participate including forces from Belgium, Canada, Croatia, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Netherlands, Norway, Poland, Portugal, Slovenia, Slovakia, the United Kingdom and the United States. [US Army Europe 1]

Held since 2010 which once involved only 2000 troops, the 2016 exercise was criticized by German Federal President and then Foreign Minister Steinmeier as a provocative confrontation policy. [Frankfurter Allgemeine Zeitung] Atlantic Resolve is a demonstration of the U.S. commitment to collective security through a series of actions designed to reassure of America’s dedication to stability in the region in light of the Russian intervention in Ukraine. [US Army Europe 2]

In sum, global order has manifested in the last two weeks as even more fluid and open to surprises with the latest US moves concerning especially Iran causing some flurry adjustments of diplomatic relations all across the globe. More important, there is a possibility of sustaining change with unpredictable impact for global order while major conflicts remain unresolved.

China: All mosques to raise national flag

(am) The China Islamic Association has made it mandatory for all mosques in the country to raise the national flag and to study socialist core values. The diktat has been passed in a bid to “strengthen concept of nation” and carry forward “the spirit of patriotism”. [Global Times] [Zee News]

China jails Tibetan language activist for five years

(am) An activist – Tashi Wangchuk – who campaigned for Tibetan language education has been sentenced to five years in prison for “inciting separatism.” Previously, he has been in jail for more than two years after appearing in a New York Times documentary talking about his campaign for Tibetan language in local schools. The video, “A Tibetan’s Journey for Justice,” followed him as he travelled from Tibet to Beijing where he attempted to file a lawsuit against local officials for contravening China’s constitution, which maintains that all ethnicities in China “have the freedom to use and develop their own spoken and written languages”. [The Guardian]

After Tashi’s trial, six experts advising the United Nations on rights said: “We condemn the continued detention of Mr Wangchuk and the criminalisation of his freedom of expression.” [The Straits Times]

Is mandated family planning eventually coming to an end in China?

(jk) China’s infamous one-child policy ended in 2015. Before that, there were already some exceptions in place, with a particular loosening of the policy in 2013 when it was possible for couples in which one partner was an only child could have more than one child. For many observers back then, it was only a matter of time for the policy to be scrapped entirely. Now, the policy it was replaced with – the two-child policy is looking to undergo a similar fate. According to the [Global Times], policy adjustments are needed based on demographic trends and the view is changing from a large population being a burden to it providing more human capital and creativity. According to anonymous sources that are allegedly close to Chinese policy making circles, an end of the planning policies and the beginning of “independent fertility” could come as soon as by the end of this year [South China Morning Post].

Hoover Institution’s China Leadership Monitor

(jk) A new issue of the China Leadership Monitor is now online, containing five articles on Chinese affairs. They cover Chinese Views on the U.S. National Security and National Defense Strategies; The New, Slimmed-Down Central Military Commission; The National People’s Congress meeting in March and the subsequent administrative reorganisation; Central and Regional Leadership for Xinjiang Policy; and the abolition of constitutional term limits which may not be as far-reaching in its implications as is often presumed [Hoover Institution].

China-Myanmar: Ethnic conflicts on Myanmar side of the border condemned by China

(ls/jm) China condemned fighting on its border between Myanmar forces and ethnic rebels that has left 19 dead, mostly civilians, in some of the worst violence to rattle the restive frontier in recent years. The Chinese embassy in Yangon urged “relevant parties” to reach an immediate ceasefire. The violence “made people from the Myanmar side flee across the Chinese border, and stray bullets have entered into Chinese territory”, the statement added. However, observers believe Beijing has influence on some rebels near its border and is an important player in a difficult peace process steered by Myanmar’s civilian leader Aung San Suu Kyi. [Agence France-Presse]

The attack led by the Ta’ang National Liberation Army (TNLA) against a casino run by militiamen and a Myanmar army post, resulted in 19 people killed, including 15 civilians. A Myanmar government spokesman assured that Myanmar military are hunting down the insurgents. [Reuters]

China, Laos vow to boost cooperation on law enforcement, security

(am) China and Laos have pledged to boost cooperation on law enforcement and security and maintain regional stability. The pledge came as visiting Chinese State Councillor and Minister of Public Security Zhao Kezhi held talks separately with Chansamone Chanyalath, Lao minister of national defence and Somkeo Silavong, Lao minister of public security here on Monday.

Zhao said China is willing to work with Laos to boost cooperation in safeguarding national security, anti-terrorism, fighting drug-related crimes, hunt for fled suspects and recovering ill-gotten gains, and fighting against Internet gambling, telecom fraud and illegal immigration, among others. [Xinhua]

Duterte says Xi will not allow his removal from office

(ls) Philippine President Rodrigo Duterte said his Chinese counterpart Xi Jinping had provided him with a personal assurance that Beijing would not allow him to be removed from office. Duterte, who did not say when Xi made the remarks, met with Xi on the sidelines of the Boao Forum for Asia in Hainan Province in China on April 10. Politicians of the opposition questioned whether Xi’s assurances were the reason why Duterte was making use of substantial Chinese loans, and his reluctance to criticize Beijing’s actions in the South China Sea. [Bloomberg]

Pakistan and China reaffirm military friendship

(ot) In a top-level meeting Chinese Central Military Commission Vice Chairman General Zhang Youxia and Pakistani Chief of Army Staff General Qamar Javed Bajwa, de facto head of the Pakistan army, discussed matters of regional security and bilateral defense cooperation.

Reaffirming friendship, trust and confidence between the countries they concluded the meeting by signing a MoU on bilateral defense cooperation. General Zhang especially appreciated Pakistan’s counter-terrorism achievements sending a signal to major critics such as the US and India and also stressed the importance of the China-Pakistan Economic Corridor. [Daily Times, Geo TV]

Taiwan: A war would be incredibly costly for Beijing

(jk) Grant Newsham, who has also previously been writing for CPG online [CPG Online], elaborates on the potential cost that Beijing would incur if it were to attempt a forceful unification with Taiwan. As he points out, in addition to the lives an invasion would cost on either side of the strait, Beijing would face serious economic challenges if it were to attack Taiwan and possibly face much more harm than what is currently being discussed under a potential “trade war” with the US. In spite of the apparent military superiority that Beijing has, an all-out unification war would have the potential of serious economic backlash, as well as creating the circumstances for a unified and coordinated effort by the US and its allies against the PRC. Newsham argues that to believe a short, sharp war will stun other countries and present them with a fait accompli is misleading and ill-advice for the government in Beijing [Asia Times].

Conversely, the PRC is pressing ahead with its increasingly aggressive posturing around Taiwan. Its recent live-fire drills and other military exercises around the island are a definite warning sign and have been officially labelled as such. Spokesman for the PRC’s Taiwan Affairs Office of the State Council, said last Wednesday that these measures were intended as a message to Taiwanese officials who consider their autonomous government to be entirely independent of the leadership in Beijing. [Newsweek]

China’s first domestically built aircraft carrier completes sea trial

(jk) The People’s Liberation Army Navy (PLAN) has reported that during the five-day trial, it has tested multiple facilities and attained the anticipated objectives. The carrier set out on its debut sea trial on May 13 and returned on Friday [China Daily].

More doubts on DPRK developments  

(jk) AiR has last week gone into some detail on why there is reasonable doubt about where the announced Trump-Kim summit could lead and how likely “real” de-nuclearization of the DPRK is. [AiR]

Casting further doubts on developments and vindicating observers who tried to calm some of the optimism of late by pointing out that we have been down similar roads before, North Korea said Wednesday it is cancelling high-level talks with South Korea and threatened to pull out of the summit with the United States over ongoing military exercises with South Korea. North Korean media pronounced that the Max Thunder Air Force drills are a provocation and in fact “rehearsals for an invasion”. [The Korea Herald 1]

Further complicating matters this week were comments by new and controversial national security advisor John Bolton who compared the model that the administration is seeking to apply to North Korea to what the US has done in Libya. Considering that Moammar Gadhafi agreed to abandon his country’s nuclear programme and eight years later was overthrown and killed by rebels backed by Washington, such comparisons will only stoke Kim’s fears and make it less likely that he will give up his nuclear weapons which have long been key to his survival strategy [CNN].

Despite the setbacks, the White House is “still hopeful” the summit between Kim Jong-un and US President Donald Trump will proceed. President Trump has also explicitly moved away from suggestions the “Libya model” would be considered and gave specific security guarantees to the North Korean leader, assuring that he “would remain in power” after a possible deal [The Korea Herald 2 and 3]. China also continues to support the meeting, urging North Korea not to cancel. Beyond that, President Xi said: “We support the improvement of North-South (Korean) relations, the promotion of dialogue between North Korea and the U.S., denuclearization on the peninsula and North Korea’s development of its economy” [AP News]. Xi has met with a delegation of visiting North Korean officials last Wednesday continuing to show that the countries are still tight.

Mounting evidence on the existence and scope of China’s “re-education” camps

(jk) Adrian Zenz, a German researcher at the European School of Culture and Theology, focusses on China’s ethnic policy and public recruitment in Tibetan regions and Xinjiang. In a recent piece, he researched the scale and circumstances of the Chinese government’s efforts to keep in control of the western Chinese province of Xinjiang which has become known as one of the most heavily policed regions of the world and is home to a significant number of ethnic Muslim minorities including Uyghurs, Kazakhs and Kyrgyz.

According to his research, “China’s pacification drive in Xinjiang is, more than likely, the country’s most intense campaign of coercive social reengineering since the end of the Cultural Revolution”. Zenz analyzed information from government procurement and construction bids along with public recruitment notices and other documents to investigate the scale of detention facilities under construction since March 2017. He estimates that the facilities that are being build can hold up to just over one million detainees. [The Jamestown Foundation: China Brief/ Academia.eu for the full report]

In addition to his report, eye witness reports have been published last week giving a disturbing report of what already is the reality for some Muslim-minority groups who had to endure “re-education” in camps which the Chinese government still claims do not exist. [AP News]

China: President Xi’s and the CCP’s central role in foreign affairs

(jk) The Chinese Communist Party’s Foreign Affairs Commission (FAC) held its first meeting on May 15. President Xi Jinping is the head of the new commission while Chinese premier Li Keqiang serves as deputy head. Chinese vice president Wang Qishan is the third-ranking member. The FAC was upgraded from a leading small group as part of the ongoing Party-State restructuring to further strengthen Party leadership over foreign affairs in March. Other leading small groups that were turned into commissions regarded cyber security, deepening reform, as well as economics and finance. For more detail on the restructuring efforts, see [SinoInsider].

According to Xi, the FAC of the CPC Central Committee should play a role in policy-making, discussion and coordination, advance the innovation of diplomatic theories and practices and provide strong guidance for foreign affairs to make new achievements. [Xinhua] Xi is continuing on his path to strengthen the CCP’s grip on all aspects of Chinese politics as well as his own position at the very top of the party.

Is the EU trying to counter China’s Eurasian ambitions with an alternative connectivity plan?

(hg) While Beijing makes already impressive inroads into Europe with its ‘Belt and Road Initiative’ (BRI), Brussels seems working on an alternative pushing ahead with plans for greater connectivity between Europe and Asia as a way to counter China’s BRI. In February, the European Commission has released a document soliciting opinion on the Europe-Asia Connectivity plan, which is expected to be adopted by the commission in July, by the European Council in October and to be presented at the 12th Asia-Europe (ASEM) Summit in Brussels later the same month. Just last month, 27 of 28 EU ambassadors in Beijing, with the Hungarian envoy being the exception, denounced the BRI for hampering free trade and unfairly favoring Chinese companies. The European connectivity plan is part of a shift in EU foreign policy aiming to act with a more unified and firmer voice.

According to Bernt Berger, head of the Asia Program at the German Council on Foreign Relations, the EU plan would provide a way for major European economies to diversify trade ties that had become too dependent on China while it could also be complimentary to the BRI. After all, the European view on the BRI is much more positive than the American, Indian or Australian. Accordingly, it will be interesting to see if and in how far the EU will seek to align the connectivity plan on the one hand with China and with India, Australia, the US and Japan on the other.

The issue is likely to be one of the key agenda items for German Chancellor Angela Merkel, who is expected to visit China later this month. Concerning the generally favorable German perception of the BRI, the European International Contractors, a construction industry trade association based in Germany, commented that the Chinese initiative consistently left little room for local contractors to get involved and praised the EU’s efforts to develop an alternative connectivity plan. [South China Morning Post]

Australian Ex-PM Rudd’s criticism of PM Turnbull on Chinese social media in Mandarin

(hg) Amid growing fears of concerted Chinese influence operations in Australia, former prime minister Kevin Rudd, who regularly blogs in Mandarin Chinese in the Chinese Internet version Weibo, where he is followed by 613,000 people has criticized PM Malcolm Turnbull for derailing China-Australia relations for personal political interests. Rudd claimed Turnbull would also insult the Chinese people, the Chinese-Australians, and the Australians, recommending instead to value Australia´s friendship with China “to establish systematic and comprehensive China-Australian strategic relation instead of being paranoid and all over the place”.

Besides a personal animosity between Rudd and Turnbull, Rudd´s comments and the mixed reaction they prompted in the Australian public point to an intensifying cultural conflict over Chinese influence in Australia. They find their reflection in China, where Rudd´s comments echo a widely held view, that Australian concerns about the Chinese Communist Party’s influence in Australia stem from a xenophobic paranoia. When Rudd was prime minister himself, initial excitement about a China expert in government was soon replaced by severe disappointment on the Chinese side when Rudd highlighted human rights abuses in Tibet. [ABC News]

Western concerns over Chinese secretive influence by Confucius Institutes

(hg) An Australian state government, the education department of New South Wales, is ‘reviewing’ its relationship with China’s controversial Confucius Institute over fears of covert foreign influence. The globally more than 1,500 Confucius Institutes in universities and Confucius Classrooms in primary and high schools aim to teach and promote Chinese language and culture. Western Universities such as Penn State, the University of Chicago, Stockholm University, and Lyon University have closed their Confucius Institutes in recent years over concerns about Chinese propaganda and influence already.

Just this week former secretary of state Hillary Clinton warned of China’s interference in Australia and New Zealand whereas US legislators have introduced the Foreign Influence Transparency Act, which would require Confucius Institutes to register as foreign agents. [Business Insider]

US – China relations: tensions over harshening One-China policy

(hg) After Washington named Beijing´s order to 36 airline companies to purge their websites of references to Macau, Taiwan and Hong Kong as separate countries “Orwellian nonsense”, the Chinese Ministry of Foreign Affairs reiterated foreign companies would have to obey official demands on how to refer to these areas as the price of doing business in China. [The New York Times]

Possible battlegrounds in the Chinese campaign against mentioning Taiwan are manifold however. Just recently the name of the island was removed for instance also from the biography of a “Foreign Policy” contributor speaking at Savannah State University in the United States, after the co-director of the university’s Confucius Institute insisted on the removal before programs were printed. [Taiwan News]

China sends fighter jets near Taiwan

(hg) In the latest of a series of drills, China sent military aircraft near Taiwan and Okinawa last Friday including multiple H-6K bombers, J-11 fighters, reconnaissance planes, transport aircraft and, for the first time, Su-35 fighters which the Chinese Defense Ministry hailed on this occasion as a “new breakthrough, highlighting the new enhancements to the Air Force’s combat capability.” [The Japan News]

U.S. and China accuse each other of wrecking the WTO

(hg) The US and China clashed before the WTO’s General Council blaming each other for risking the destruction of the World Trade Organization. U.S. Ambassador Dennis Shea, addressing the WTO’s General Council for the first time, began by attacking the judges of the WTO’s Appellate Body for a “steadily worsening rupture of trust” by disregarding the rules they were supposed to apply and for failing to observe a 90-day timetable for judging appeals. The United States has vetoed new appointments to the Appellate Body, which is effectively the supreme court of world trade.

The Chinese Ambassador to the WTO began by warmly welcoming “our new colleagues, especially Dennis” to then criticize the “dangerous and devastating” U.S. actions stating that the US “by taking the selection process as a hostage”, would abuse the consensual decision-making mechanism. Moreover, he claimed the U.S. veto, along with steel and aluminum tariffs and a threat to put $50 billion of tariffs on Chinese goods for alleged intellectual property theft, had systematically challenged the WTO’s fundamental principles. The US counter-claim was to highlight that China, “the world’s most protectionist, mercantilist economy” would ironically “position itself as the self-proclaimed defender of free trade and the global trading system”.

Many other WTO members joining the debate meanwhile also expressed concern that the U.S. actions could make the system dysfunctional rejecting any linkage between judicial appointments and reforming the WTO. The discussion seems to have been extraordinary intense with unusually explicit mutual accusations of two of the most prominent members. [Reuters]

East Asian regional order: China, Japan and South Korea work together on denuclearizing North Korea

(hg) The political leaders of China, Japan and South Korea have agreed to cooperate on ending North Korea’s nuclear program and promoting free trade at the first summit for the Northeast Asian neighbors after a hiatus of more than two years. [Time Magazine] Notably, Chinese – Japanese relations seem to improve markedly in context of Chinese Premier Li Keqiang´s three-day state visit in Japan, the first by a top Chinese leader in eight years. [CNN] [SupChina]

Consequences of the US nuclear deal withdrawal for the Asian geopolitical order

(hg) Two – arguably related – major events, the US withdrawal from the nuclear deal with Iran and the relatively massive Israeli military attack on Iranian positions in Syria will have some impact on the processes defining the current global geopolitical order and especially the Asian one. The two events can be seen against the background of the English – Russian tensions about the poisoning of UK spy Skripal and the ensuing diplomatic retaliation by major Western countries as well as the recent airstrikes launched by the US, UK and France against Syria. Both major events are embedded in a process of worsening relations between the West and Russia and a possibly emerging Turkish – Iranian – Russian – Chinese axis while Saudi – Arabia is going to show even growing assertiveness against Iran.

Especially, the unilateral US withdrawal from the Iran nuclear deal, officially named Joint Comprehensive Plan of Action (JCPOA), brings some new dynamics to the currently significant processes relevant for the present state of global order. What is about to happens now, is that the other signatories try to save the deal with notable activities.

While the chief inspector of the UN’s International Atomic Energy Agency (IAEA), unexpectedly resigned [Times of Israel] after the IAEA has highlighted Iran´s cooperation with the nuclear watchdog over recent years, the Iranian foreign minister is embarking on a diplomatic tour, first to Beijing and Moscow, and then to Brussels to meet his counterparts from Britain, France and Germany. At the same time, Russian President Putin has spoken with the government heads of Germany and Turkey, Merkel and Erdogan, to keep the nuclear deal alive [Times of Israel], whereas German Chancellor Merkel said in a phone call with Iranian President Rohani that her country would adhere to the 2015 nuclear deal. Additionally, Russian and German foreign ministers talked in Moscow about how to constructively proceed. After all, this is the joint position of all other signatories, namely Russia, Germany, China, Britain, France and Iran [Radio Free Europe] with the three European powers having issued a joint statement criticizing the American pullout [Government Europa].

In Europe, both France and Germany have seen a sharp rise in exports to Iran since sanctions were lifted in 2016. Especially France has sharply condemned the re-imposition of sanctions as “unacceptable”. Its Economy Minister even said Europe had to defend its “economic sovereignty” and called on the European Commission to look into possible retaliatory measures. [BBC] Even America´s staunchest allies in Asia, Japan and Australia, still support the deal [US News]. The Japanese Foreign Minister Taro Kono underlined Tokyo´s support for the nuclear deal in a phone call with his Iranian counterpart urging all other parties to remain committed to the multilateral agreement. [Tehran Times]

Now, Berlin, Beijing and Moscow are the given brokers to create a platform for talks on the future of the Iran nuclear deal, a constellation that cannot please the American interest. It might, moreover, be argued that the Trump move, which reflects the new security environment in Washington with Mike Pompeo and John Bolton in key positions, will backfire in case it has no clearly defined short-time purpose. Otherwise, the unilateral withdrawal from the deal is likely to benefit especially China, possibly even bring Moscow closer to Europe again, endanger the developing US ties with India and generally lower the US´ weight in Asia´s shifting security order.

First, Beijing is prone to evolve as the first inter pares to foster an international reaffirmation of the deal after it had played a crucial role in bringing Iran to forge the deal in the first instance.

Additionally, China will gain in terms of energy access and make more trade and infrastructure inroads to Iran. China will anyway be able to continue business with Iran without being much harmed by sanctions. It is, in fact, highly experienced to circumvent sanctions and will probably just create companies that will operate only in or with Iran to avoid them. [Sputnik News 1] For China, with its potentially all-controlling central authority and low level of market transparency, such workarounds are much easier to realize than for European companies.

Iran sells already more to China than to any other country and celebrated a 25 percent increase in exports there last year already while the value of Chinese exports to Iran also increased by more than 21 percent last year, according to Islamic Republic of Iran Customs Administration’s statistics. Now, China – Iran trade and infrastructure ties are very likely to even grow more. Generally, China will gain strategic space with regard to the Middle East to be used to advance its Belt and Road Initiative (BRI). Just now, Beijing has officially opened a new train route to Iran likely to go through Kazakhstan, Uzbekistan and Turkmenistan. [Sputnik News 2]

Moreover, the US might effectively force European companies out of the Iranian market – to the benefit of China. The US sanctions which will especially aim at Iranian crude oil will limit its global trade opportunities to the special advantage of China as the world’s largest importer of crude oil that might even get it cheaper now. The gain to take over a lead role in directly exploiting Iranian oil and gas fields might be even worth for China to directly invest without circumventions. The [Japan Times] just reports that China’s state-owned energy major CNPC is ready to take over French giant Total’s stake in the giant Iranian South Pars gas project if the French company leaves due to the US sanctions. The Iranian South Pars field has the world’s biggest natural gas reserves ever found in one place and the possibility of Total’s pullout is reportedly quite high now. [The Japan Times]

Lastly, and particularly important, China will reinforce the petro-yuan as more than just a spoiler attack on the dominance of the dollar-denominated Brent and West Texas Intermediate benchmarks. According to the latter, oil is priced and traded in U.S. dollars which is of crucial importance for the US economy. The increase in the use of the renminbi in global financial trade following a Chinese lead role in the Iranian oil market would be much more relevant than the immediate benefit of energy supply and pricing imports in yuan to the end that it would spare China the cost of exchanging dollars. After all, the development reinforces the Chinese move in March this year to launch a futures exchange in Shanghai that aims to become a yuan-denominated global benchmark, which itself is part of a larger strategy to establish the renminbi as the leading global currency. [Reuters]

The relevance of these developments is highlighted by China´s sheer market power having overtook the US as the world’s largest oil importer last year already and hoping to beat that achievement in 2018. At the same time, the yuan-denominated crude exchange in Shanghai will offer another path for Iran to get past US sanctions, which are typically enforced when banks attempt to clear dollar-denominated trades in New York. [The Business Times]

Second, besides empowering China, the US withdrawal strengthens Iranian resilience and weakens the US own strategic ties as partly indicated already above. Regarding Iran the change is obvious. Summer last year, Washington could hope to empower the Iranian opposition while it created a new Iran Mission Center at the CIA to “turn up the heat on Iran”. [The Wall Street Journal] Now, the Trump administration has managed it to further unite Iranian politics. More important is the effect on Europe. Even if key countries like Germany and France will eventually not be motivated to rebalance their strategic focus after a series of unilateral moves by President Trump, European leaders will have to work closely with Beijing and Moscow in the newly created situation while Iran, Russia and China will be pushed closer to each other once more.

Especially interesting is the effect on India which has great interests in Iran. The question is, in how far India will side with the US. Harsh V. Pant gives an interesting analysis of the situation from an Indian policy perspective highlighting India´s stakes regarding the presumably even intensifying Iran – China relations. [The Hindu] India´s immediate stake in Iran is mainly its investment in the Iranian Chabahar port that had often been projected as India’s response to China´s investment in the Pakistani Gwadar port. Recently however, Iran invited both China and Pakistan to join in, which highly frustrated Indian policy makers. Counterintuitively to consult a siding with the US, Pant analyses the possible Indian policies in the current scenario on the basis of the already existing deep economic and defense ties between Teheran and Beijing. His analysis starts with an understanding for the Iranian pro-China perspective especially in the presently given situation: “Given the overt hostility of the Trump administration towards Iran, it is imperative for Tehran to maintain cordial relationship with a rising power like China”. From here, the author, a Professor of International Relations at King’s College London, advises New Delhi “to navigate its interests in the region accordingly” with a realistic view to accept some form of Chinese participation in the Chabahar project while India and China are anyway exploring joint economic projects in Afghanistan. [The Hindu] Such a continuation with Indian – Iranian ties that would even include a limited Chinese – Indian rapprochement could put US – Indian relations under serious stress however. Whichever path Delhi will actually take in the given situation, the ‘Iranian factor’ is likely to have a significant impact on the overall Asian order regarding the Indian relations with both China and the US.

Third, the US, by withdrawing from the nuclear deal, are weakening their clout as a global norm setter once more. For the US, to leave from a multilateral agreement – effectively a disarmament treaty – that has been endorsed by UN Security Council Resolution (No 2231), will further weaken the US´ strategically important position as a central driver of an international law – based order, an opportunity that will be seized by China to the largest extent possible.

Moreover, by increasing its arsenal of sharp sanctions, the US might find themselves caught between either alienating some key partners or undermining the credibility of their normative approach in general. The Iran sanctions that will add to the sanctions against Russia recently enabled by the Countering America’s Adversaries Through Sanctions Act” (CAATSA) [US Dep. of Treasury] cause important allies to seek exemptions from sanctions, a step already initiated by both the French and German government regarding Iran. A similar request has been submitted by India regarding the CAATSA relevant purchase of the Russian S-400. In times of a shifting geopolitical order, to deny the respective waivers will worsen bilateral relations, to grant them undermine the authority of the respective regimes in the first place.

China’s anti foreign spies campaign  

(hg) Under President Xie national security has become a core part of state policy and his own legacy with a series of national security laws having been passed that broaden the government’s already impressive powers to monitor and investigate everyone and everything deemed a threat to stability, focusing largely already on ideas and opinions. Late last year the counter-espionage law has been amended to widen definitions of punishable behavior making foreign individuals or groups punishable for fabricating, distorting facts, or issuing information that harm China’s national security.

The [Guardian] reports on an anti-spying campaign that warns citizens of spying foreigners disguising who they really are, calling the public not to be tricked by foreign academics, English teachers, and NGO workers. Through web campaigns, hotlines, posters, cash rewards, classes, and an annual “national security awareness” day the campaign claims to aim at identifying foreign spies, preventing collaboration and recruiting citizens to support the state´s counter-espionage effort. A webpage for reporting espionage that includes a hotline to call “in dangerous times” warns citizens to “be on alert for friends who wear masks”. Posters on the subway tell: “You can still come back”, “Confess (with sincere repentance!) to relevant authorities and you MIGHT not be investigated further”. These kinds of warnings become increasingly common and seem, according to critics, supposed to breed mistrust of everything foreign while giving authorities a reason to further tighten national security. In 2016, Chinese media reported already the very exact number of 115,675 foreign spies operating in China, mostly from Germany, Japan, and the United States. [The Guardian]

By branding foreign influence as a primary national security theme and making everyone responsible and calling on individuals to actively participate in China’s state security, the delineation of the own and other, the pure and the impure becomes a highly dynamic tool to create cohesive social discipline and state legitimacy.

This notwithstanding, to a certain extent “the presence of foreign spies and their recruitment work in China is real” as in others as well where Chinese agents operate. Between 2010 and 2011, there have been at least a dozen CIA sources imprisoned or killed, one in front of his colleagues outside a government building. [The Guardian]

As a xenophobic campaign, the Chinese partly resembles somehow both, the Indonesian security state´s ‘proxy warfare’ campaign targeting suspected foreign influence behind unwanted political and sexual preferences in the country and, to a lesser degree, the Australian fear of secretive Chinese influences. Different however are arguably their touch with reality and the scope, impact and scale of the respective campaigns.

Former rising star and Politburo member Sun Zhengcai sentenced to life for graft  

(hg) Sun Zhengcai, once tipped to be among China’s next generation of leaders, was sentenced to life in prison for bribery – all in all US$26.7 million -, stripped of his political rights for life and all his property. Sun declared not to appeal pleading guilty to the crimes that would have been punishable by death saying: “I sincerely confess to and regret the crimes [I committed]. [I] accept the court’s verdict [and] will not appeal,” and: “I will earnestly accept re-education.”

Sun committed the crimes as district Communist Party boss in Beijing in 2002, minister of agriculture, and party chief of the northeastern province of Jilin and Chongqing helping to win project tenders, secure government approval for projects and gain promotions. He was sacked as party boss of the strategic important mega-city Chongqing in July in the run-up to the party’s national leadership reshuffle in October last year. He was the youngest member of the Politburo before he was expelled, considered a strong candidate to sit on the Politburo Standing Committee, the Chinese leadership’s inner sanctum, and become China’s premier. [South China Morning Post 1]

Sun´s downfall followed that of party heavyweight Bo Xilai, his predecessor as party chief in Chongqing, and an ongoing purge of the local party leadership.

Recently, a senior police leader, the chief of Fuling district police, Zhou Jingping, became a target of an internal probe. Zhou was once a close aide of Bo’s police chief and right-hand man Wang Lijun but fell out with Wang in mid-2011 short before Bo and Wang’s downfall in 2012.

The prolonged crackdown on “pernicious influences” in Chongqing has to be seen as a message to all Chinese provincial leaders, “[…] loud and clear: local leaders should pledge absolute loyalty to the central leadership,” and: “Xi is now the unchallenged core of the party, […], the political future of provincial leaders should be decided by, and only by, the central leadership – they have no room to think for themselves.” [South China Morning Post 1]

Another article reflects on occasion of the Sun case and comparing it with those of the 2013 Bo Xilai case on the Chinese version of the rule by law. Bo´s case gripped the nation and made headlines around the world. Back then, some hailed the trial as an expression of a new rule of law, largely due to the unusual transparency by which the trial was conducted. In a remarkable contrast to Bo’s five-day trial, Sun’s lasted less than half a day, merely announced on Sina Weibo in the morning before it started without broadcasting any of the proceedings. [South China Morning Post 2]

The contrast between the cases does arguably not point to a decline of the rule of law rather than to variations of the way politically relevant cases are handled, be it as extensively presented show trials or shaped by secret arrests, hurried proceedings and secrecy.

Chinese Missiles are transforming the balance of power in the skies

(hg) After the U.S. and its allies effectively owned the skies for a long time, that is no longer the case with rapid technological progress not only in Russia´s but also China’s aerospace industry. The latter has developed impressive air-to-air missile systems, the PL-15, that could seriously challenge Western air forces. The new air-to-air missiles cost one or two million dollars and can destroy a $150 million aircraft. In March, the U.S. Air Force awarded a half-billion-dollar contract to supply close allies with Raytheon Inc.’s latest long range air-to-air missile, capable of hitting enemy planes from 160 kilometers away. The Meteor, a new European equivalent, may be even more efficient. But China’s latest missile development has a greater range than either. Another Chinese air-to-air weapon in development, provisionally known as PL-XX, aims at slow-moving airborne warning and control systems, thus the flying neural centers of U.S. air warfare, from as far away as 300 miles. At closer range, China’s new PL-10 missile is comparable to the best “fire-and-forget” equivalents, meaning any dogfight would likely end with a so-called mutual kill which means a significant deterrent.

While the U.S. air force remains the world´s strongest by far, the Chinese advances come at a critical time adding to advancements in other crucial defense fields such as robotics and artificial intelligence. Moreover, the world´s best air force might now encounter real resistance. Notably, Chinese pilots, planes and weapons don’t have to be better than their U.S. counterparts – what they are not yet – to radically change battlefield calculations. Yet, China’s new aircraft, combined with the latest air-to-air, cruise, anti-ship and Russian origin S-400 air-defense systems create a high – risk challenge for US operations in contested areas in Asia.

Moreover, China, Russia and Pakistan cooperate on increasingly sophisticated terms which is intensifying their alliances. Russia supplies Beijing and Beijing supplies Pakistan with China and Pakistan having co-produced the JF-17 fighter since 2007, while Russia provided high quality engines. In March, it had been reported that the JF-17 will be upgraded with active array radar and, maybe, also China’s PL-10 missiles. This would put India’s aging Russian MiGs at serious risk in case of a confrontation. In any case, China is rapidly advancing its military capabilities in concert with other regionally relevant powers contributing to significant patterns of Asia´s emerging security order. [Bloomberg]

India: Foreign policy shift as a result of China’s role in the region, opting for Western allies over Russia in defense cooperation

(ot) Indian Prime Minister Narendra Modi’s increasingly proactive role in regional military cooperation is the result of China’s rising military, economic, and political engagement in South Asia and the Indian Ocean, says Jeff M Smith of the Heritage Foundation’s Asian Studies Center.

In the past decade, many of China’s operations in the region are seen as a strategic encirclement of India, including its involvement in politics in Nepal, Sri Lanka, and the Maldives, the ambitious Belt and Road Initiative, and a planned Chinese naval base on the coast of Pakistan. As a result, PM Modi’s administration has been moving away from the country’s traditional non-alignment policy, by shifting its stance towards strategic collaboration with the United States and its security partners. The country has shown interest in the resurrection of the Quadrilateral Security Dialogue, or Quad, a multilateral partnership with Australia, Japan, and the United States. The project, which has been dormant for nearly a decade, aims at deterring the rising influence of China and Russia in the Indo-Pacific region. In addition, India has entered into defense-related agreements with France and other naval cooperation with Japan and the United States. [Asia Times 1]

In terms of its defense policy, India, once Russia’s top defense partnership, is now opting for Western arms. India-Russia’s joint Fifth Generation Fighter Aircraft project has been called off. The defense cooperation between India and Russia also hit hurdles as a result of the United States’ Countering America’s Adversaries Through Sanctions Act (CAATSA). The country’s relationship with Russia was put under test when it jointed Western countries to condemn the Skripal poisoning case in England.

On the other hand, India’s neighbors are looking towards China. With its coercive tactics, unpredictable policies, and domineering attitudes towards its neighbors, India has caused further anxieties in the region. [Asia Times 2]

India: Modernization of Navy on track

(ot) On Tuesday, India’s Defense Minister Nirmala Sitharaman, addressing the naval commanders’ conference in New Delhi, said that the modernization of the Indian Navy is expected to make the country “a force to reckon with” in the Indo-Pacific maritime region in the coming years. However, persisting budgetary constraints as well as shortages in submarines, multi-role helicopters, minesweepers, and drones, are some of the challenges ahead of the development.

Despite no emphasis on tensions with China, the fact remains that the Chinese Navy is fast expanding its operations in the Indian Ocean Region, having established its first overseas military base at Djibouti in the Horn of Africa. Meanwhile, India has been undertaking mission-based deployments from the Persian Gulf to Malacca Strait since August last year. The minister expressed satisfaction for the Navy’s continued “high operational tempo” through regular deployment of ships, submarines, and aircrafts as the “primary instrument and manifestation of the nation’s maritime power, while also establishing itself as a potential tool for military diplomacy”. [The Times of India]

South China Sea: Vietnam presses China as Philippines remain silent

(ls) Vietnam has asked China to withdraw military equipment from the South China Sea, following media reports this month that China had installed missiles there. “Vietnam requests that China, as a large country, shows its responsibility in maintaining peace and stability in the East Sea,” a Vietnamese foreign ministry spokeswoman said. U.S. news network CNBC reported this month that China had installed anti-ship cruise missiles and surface-to-air missile systems on three of its outposts in the South China Sea. [Reuters]

While Vietnam has protested China’s alleged missile deployment in the disputed waterway, the Philippine administration of President Rodrigo Duterte has yet to say what it intends to do about the installation of high-tech weapons on Philippine territory. Several lawmakers have urged Duterte to protest the missile deployment, but presidential spokesperson Harry Roque said the government has yet to verify the information. [Inquirer.Net]

Nonetheless, US and Philippine forces have begun their largest annual military exercises so far under President Rodrigo Duterte. The decades-old exercises opened on Monday and involve combat drills in mock urban settings to train special forces in battling terrorists in cities, following an Islamic State-linked siege on southern Marawi city last year. Duterte initially vowed to scale down America’s military presence and involvement in combat drills as he sought closer ties with China and Russia. [South China Morning Post]

Meanwhile, Chinese Premier Li Keqiang said China is committed to a peaceful settlement of bilateral disputes with ASEAN nations over the South China Sea, despite differing views. Li made the remarks after holding talks with Indonesian President Joko Widodo in West Java, in his first visit to Indonesia as Prime Minister. China is the third-largest foreign investor in Indonesia, with investment amounting to US$3.4 billion (S$4.5 billion) in 2017. [The Straits Times]

How sustaining is Duterte’s foreign policy shift toward China?

(hg) Philippine President Rodrigo Duterte who refuses American hegemony in Asia has put much effort over the last two years to normalize bilateral relations with China that he sees as a geopolitical reality that cannot be ignored.

Still, however, this very China’s assertiveness extent also to what the Philippines claim as its own territorial waters. Earlier this year, the Philippine military chief implied that unilateral Chinese deployment of military assets on Philippine-claimed land would constitute a direct betrayal of China’s promise not to militarize the disputed area consequently exploited by corresponding accusations of “aggressive unilateral action” towards militarization by the US ambassador in Manila. It remains to be seen in how far President Duterte will be able to play the China card if China is continuing to entrench its presence in the contested waters. [South China Morning Post]

China’s rule of law development: Regresses in the wake of anti-corruption campaign

(dql) Recent hasty and non-transparent trials as well as secret arrests of high-ranking party officials and top business executives in the course of President Xi Jinping’s sweeping corruption crackdown have put into perspective progress which has been made in judiciary reforms and rule of law in China over the past five years, Wang Xiangwei writes in [South China Morning Post].

Chinese military build-up in the South China Sea

(ls) China has, for the first time, installed anti-ship cruise missiles and surface-to-air missile systems on three of its outposts in the South China Sea, CNBC reported on Wednesday, citing sources with direct knowledge of U.S. intelligence reports. China has made no mention of any missile deployments but says its military facilities in the Spratlys are purely defensive, and that it can do what it likes on its own territory. [Reuters 1]

At the same time, the Philippines have completed the purchase of their first-ever ship-borne missile systems, boosting its maritime deterrent as part of a military modernization program. A senior naval commander said the Philippines would now be more of a force in patrolling the South China Sea and its pirate-plagued southern waters. The missiles have a maximum range of eight km (5 miles). [Reuters 2]

China’s military spending: On the rise

(dql) The Stockholm International Peace Research Institute (SIPRI) has released its fact sheet on world military expenditure 2017 revealing that military expenditure in Asia rose for the 29th successive year with China as largest spender in Asia having the worldwide highest increase (5.6%) in military spending in 2017. China with a total spending of 228 billion USD is followed by India as second largest spender in Asia with spending at 63.9 billion USD and an increase of 5.5% compared with 2016, and South Korea in third position which spent 39.2 USD, an increase by 1.7% between 2016 and 2017.

The top four spender are USA (610 billion USD), China, Saudi Arabia (69 billion USD), and Russia (66 billion USD). [SIPRI]

China-US trade relations: Tensions remain after inconclusive high level talks

(dql) The two-day trade negotiations this week between Chinese and US senior officials failed to arrive at a deal to ease the ongoing fierce trade dispute. Beijing refused to accept strong US demands including a drop of China’s tariffs to match lower U.S. levels; the elimination of limits on U.S. investment in key industries; an end of state-sponsored cyber-attacks on U.S. targets; a boost of intellectual property safeguards; and a halt of subsidies for several advanced technology industries as well as reduction of the US trade deficit by 200 billion USD by 2020. [ArkansasOnline]

India-China relations: Modi-Xi talks end in border cooperation

(ot) On Saturday, the first informal meeting between Indian Prime Minister Narendra Modi and Chinese President Xi Jinping in Wuhan, China, concluded with an agreement to improve military communication and to maintain peace in all areas of the India-China border region.

A joint statement issued by the Indian Foreign Ministry following the summit outlined proposals to strengthen direct lines of communication between the nations’ militaries to “build trust and mutual understanding and enhance predictability and effectiveness in the management of border affairs.” According to the statement, the two leaders also planned to “push forward bilateral trade and investment”, without identifying how that could be achieved. [CNN] [Reuters]

As a result, on Tuesday, Indian and Chinese militaries held a Border Personnel Meeting in Ladakh, India, where they discussed border management issues and agreed to maintain peace along the Line of Actual Control, the de-facto boundary between the two countries, as well as other confidence building measures. So far, the two side have agreed to carry out coordinated patrols in disputed area as well as to set up a hotline between the Indian Army’s Director General of Military Operations and the Chinese authority of similar position. [Hindustan Times]

India: Military spending increases, joining the world’s top five defense spenders

(ot) India has become one of the world’s five biggest military spenders, joining the U.S. and China, according to a report by the Stockholm International Peace Research Institute released on Wednesday. In 2017, India’s defense spending rose by 5.5 percent to 63.9 billion USD, surpassing France. The Indian government’s increased spending was motivated at least partially by geopolitical tensions with China and Pakistan. It was also the result of the country’s reliance on imported weapons and sprawling personnel costs.

The report showed that the world’s biggest military spenders has remained consistent in recent years, dominated by the U.S. and China, which spent 610 billion USD and 228 billion USD respectively. However, the balance of military spending is “clearly shifting” towards Asia, Oceania, and the Middle East, driven by spending increases in China, India, and Saudi Arabia. [Bloomberg] [South China Morning Post]

Chinese capitalism and economic integration in Southeast Asia

(ls) In an analysis for ISEAS, Yos Santasombat examines how China has become a skilled practitioner of “commercial diplomacy” in Southeast Asia. He holds that, as long as it continues to lead the way in regional integration, China’s state-led capitalism will seek to integrate itself into the ASEAN Economic Community. He writes that, as China rises, Southeast Asia has witnessed increased complexity and variations of “hybrid capitalism”, including alliances between state-led capitalism, transnational entrepreneurs emanating from China’s “going out” policy and ethnic Chinese in Southeast Asia. He distinguishes three main forms of Chinese Capitalism in Southeast Asia – neoliberal capitalism, flexible capitalism and Confucian capitalism – which intermingle into a range of local varieties under different socio-economic conditions. [ISEAS]

Myanmar/Bangladesh: UNSC Delegation visit

(jm) A delegation of the United Nation Security Council visited several parts of Bangladesh and Myanmar related to the Rohingya crisis.

A central issue is the lacking part of the overall budget of 951 million of U.S. dollars needed to execute a plan to repatriate the refugees. With the monsoon season, the situation of the Rohingya already worsened.

On occasion of press conference with the representatives of the UNSC and discussions on the role of Myanmar, the representatives of China and Russia were skeptical about the possibility to support a binding UNSC resolution for the time being. [What’s in Blue]

ASEAN Summit recap: Economic and security issues dominated

(ls) At the end of the 32nd ASEAN Summit in Singapore, Southeast Asian leaders have given warning that a growing trade dispute between the US and China is putting their economic growth at risk. In terms of security, Singapore Prime Minister Lee Hsien Loong that Southeast Asia faces “very real” threats from Islamic State (IS) group despite their defeat in the Middle East. Fears are also growing that Southeast Asia, which is home to booming economies where a growing number of people are adopting digital technology in their everyday lives, could be increasingly targeted by cyberattackers. Human rights activists criticized that the summit failed to address pressing human rights issues in Southeast Asia. [South China Morning Post] [Al Jazeera]

The ASEAN leaders concluded their summit by releasing a communiqué that calls for exercise of self-restraint in the disputed South China Sea and “irreversible” denuclearization of the Korean Peninsula. Read the full chairman’s statement of the 32nd ASEAN Summit at [The Philippine Star].

China: Civilians’ increased role in security crackdown in Xinjiang

(dql) In China’s sweeping security crackdown on separatism and terrorism in Xinjiang which has transformed the far western region into a virtual police and surveillance state, civilians sent by the government to rural areas of Xinjiang are playing an increasing role. Grouped in ‘work teams’, they not only support local authorities to implement the social engineering policies of the government, but also assume functions of investigating and interrogating villagers on suspicion of being brainwashed by extremists and a threat to the state. Since last year more than 10000 such civilian groups have been recruited to reinforce local authorities’ surveillance work in villages across the far western region.  [Hong Kong Free Press/AFP]

For an interesting account and comparison of police budget spending among regions in China see Adrian Zenz in [The Jamestown Foundation: China Brief].

China-US ‘human rights dispute’: Beijing issues report on human rights in the USA

(dql) Short after last week’s release of the US Department of State 2017 Country Reports on Human Rights Practices which labelled China’s government “morally reprehensible” violating human rights of those within their borders on a daily basis” [AiR 4/4/2018], China’s State Council countered with its “Human Rights Record of the United States in 2017” accusing the US – among others – of infringement on civil rights, systematic racial discrimination, and money politics making “inequality worse” than in the years before. [Xinhua]

In a related move, Beijing rejected an US Senate resolution passed on Wednesday which denounces China’s installation of the 15th Dalai Lama as an “invalid interference in the right of religious freedom of Tibetan Buddhists on Tibet” [US Senate Tibet Resolution 2018]. The US  was urged with reference to the above mentioned human rights report “to properly manage its own country before blaming others.” [Global Times]

Meanwhile, Reporters without Borders’ Freedom of Press Report 2018, released this week, ranks China 176 among 180 countries (with Norway as best on 1 and North Korea as worst on 180) stating that “President Xi Jinping has succeeded in imposing a social model in China based on control of news and information and online surveillance of its citizens” while at the same time “trying to export this oppressive model by promoting a ‘new international media order’ under China’s influence.” [Reporters without Borders 1] The USA are ranked 45 with freedom of press having been “under increasing attack over the past few years, and the first year of President Donald J. Trump’s presidency has fostered further decline in journalists’ right to report.” [Reporters without Borders 2]

China-India summit: Ties improved?

(dql) During Prime Minister Modi’s two-days informal summit with President Xi Jinping this week, both state leaders agreed to boost communication between both countries’ military aimed at building “trust and mutual understanding and enhance predictability and effectiveness in the management of border affairs”, Foreign Secretary Vijay Gokhale announced. [Nikkei Asian Review]

Modi and Xi also agreed to undertake a joint India-China economic project in Afghanistan to be identified and designed in subsequent talks, a move analysts expert to strain relations between China and Pakistan, . [The Pioneer]

The conciliatory encounter between the leaders of world’s two most populous countries comes a year after a more than two-months long stand-off over the Doklam crisis and amid the countries’ struggle for dominance in Asia.

Indian strategic ties after the Modi-Xi meeting: the case of the US, Russia, and Australia

(hg) After the first ‘informal’ summit between Indian Prime Minister Narendra Modi and Chinese President Xi Jinping was concluded with a careful rapprochement between the countries, it is interesting to assess Indo-Pacific´s strategic environment on more general terms. Worth mentioning in this regard are some recent developments concerning India´s relations with the US, Russia and Australia.

Starting from the finding “it appears the Asia-Pacific region is due for a grand strategic makeover”, a recent article in the [The Diplomat] takes a historical perspective to highlight the dynamics of the current Indian-American alignment. Regarding the ongoing strengthening of military, diplomatic, and economic ties between India and the US, the author is looking at “the last time the US and India were this aligned”, namely in the 1780s when both tried to jointly contain the British Empire.

The article´s quintessential conclusion – “if history rhymes, it tells us that a U.S.-India strategic alignment is not so new” – sounds a bit trivial though. After all, it seems debatable if a short and unsuccessful strategic alignment around 220 years ago makes a strong case for the actual prospects of US-Indian relations and their impact on China. The point is, however, that it is exactly the fact that the still limited depth and momentum in Indian-American relations warrants the sort of narrative underpinnings the article is trying to provide. From this point of view, media attention might be read as part of the very pattern that are forming or accompanying the competing trends of the currently emerging geopolitical order of Asia.

Another article focuses on the Indian withdrawal from plans to jointly develop a stealth fighter jet with Russia earlier this month, tracing back the long decline in bilateral attempts between the countries to finalize the project. Against this background and given the fact that “New Delhi shares more political interests with Washington than it does with Moscow”, India´s further steps concerning its air force modernization will be of interest “as a gauge of how comfortable New Delhi is with further deepening its relationship with the United States”. [The National Interest]

The picture is complex indeed. On the one hand, the US wish that Delhi might decide for American weapon systems. At the same time, the US Countering America’s Enemy’s Through Sanctions Act (CAATSA) is a disincentive for Delhi to deepen its already profound relations with Russia regarding arms supply from Moscow. Section 231 of the CAATSA mandates secondary sanctions to any nation entering into high-value deals to procure military hardware from Russia.

Whereas a Bloomberg report suggests the US – probably Lockheed Martin – might provide the Indian Air Force with its combat jet technologies in the near future [Bloomberg], [Sputnik News] features an Interview with Indian Air Force chief Air Chief Marshal B. S. Dhanoa, who says that “it is incorrect to report that we are interested in F-35 [or F-35 technology to equip F-16]”. The Indian Air Force chief has also categorically denied any threat to India-Russia defense deals due to the American CAATSA. [Sputnik News]

Meanwhile, India seeks US exemption to buy the legendary Russian S-400 air defense missile system from Russia worth about $5.5 billion. Reportedly, the Indian government has informed the US that India cannot abruptly scale down its reliance on military hardware from Russia after decades of bilateral defense cooperation and applied for a waiver from sanctions. The S-400 long-range air defense missile system with its capability to destroy incoming hostile aircraft, missiles and even drones at ranges of up to 400km can fire three types of missiles and simultaneously engage 36 targets to create a layered defense is also effective against stealth multi-role fighter jets. The system, which Russia has started supplying to China, is expected to be delivered to Turkey next year and has also been deployed by Russia in Syria. [The Economic Times]

The Indian application for a waiver to obtain the S-400 is a sensitive issue due to the reputation of the S-400 as setting the gold standard of comparable weapon systems including American ones, its success in action and the fact that Turkey as a major NATO member decided to buy the system before Turkish-American tensions grew to the current degree.

An example for the high benchmarks set to obtain a CAATSA waiver is the Trump administration´s announcement last Friday that it would not issuing waivers to U.S. companies, including oil giant Exxon Mobile, authorizing drilling in the Black Sea prohibited by current sanctions against Russia. [The New York Times]

Moreover, on the sidelines of a NATO gathering April 27, US Secretary of State Mike Pompeo has just explicitly warned his Turkish counterpart against purchasing the S-400. [Radio Free Europe]

Against this background, the ongoing attempts of the Pentagon to enable a waiver for India are remarkable. US Defense Secretary Gen. Jim Mattis appealed last Thursday to the Congress to urgently provide India the requested national security waiver, saying imposing sanctions on it would only hit the US. [The Times of India]

In other words, the ongoing Indian S-400 story is worth to be further observed. This is even more true as Vietnam, another regionally important country, is generally in a similar situation as India, both being interested to lever a strategic partnership with the US against China, while being highly depended on Russian arms supply.

A serious setback for the emergence of a solid anti-China coalition formed around the US- Indian-Japanese-Australian axis has meanwhile just manifested regarding Indian-Australian relations. Australian Defense Department spokesman has confirmed Australia won’t participate in a major Indian-lead multilateral naval drill, reportedly because it has not been invited by the Indian government.

The Indian silence is significant after India, the US, Japan and Australia have revived their plan to form a Quadrilateral Security Dialogue, the so-called Quad, a military partnership to contain China. In January, Australian Prime Minister Malcolm Turnbull said discussions on Australia returning to multilateral naval exercises with India were progressing well. The eventual non-invitation by Delhi might be seen as a casualty of India’s just improving relations with China and is definitely a blow for the Quad. [The Australian]

Concerning the long-term character of Sino-India relations, the recent, basically positive meeting between Modi and Xi should not be overloaded with highflying expectations for the long-term future. A temporary betterment of bilateral relations seems to express both countries´ current strategic considerations. This notwithstanding, India seems too important as a strategic weight, its leadership too determined, and its South Asian backyard too volatile, to not eventually being inclined to decide either in favor or against China and the US respectively. This, at least, is the perspective reflected by the headline and conclusion of a [Forbes] article that conjures up “the coming clash between China and India” without, however, providing much substantive arguments.

The China-India-Nepal Triangle

(hg) On occasion of the visit of Nepal’s Foreign Minister in China from April 16-21, [The Diplomat] addresses the ongoing Chinese-Indian competition over influence in Nepal with a thorough analysis that gives China the advantage over India. The most recent meeting of Indian Prime Minister Narendra Modi with Chinese President Xi Jinping might, however, slow the harsh tone of the competition down for a while. [The Diplomat]

Pakistan and India to hold joint military drills

(jk) Authorities in Pakistan have confirmed that they will hold joint military drills together with India and other regional countries, including China, for the first time under the roof of the Shanghai Cooperation Organisation (SCO) in Russia coming August. Both South Asian nations joined the SCO as their full members in June last year. The military drills will reportedly focus on preventing terror attacks and dismantling terror networks.

While the two countries have participated together in United Nations peacekeeping missions in the past, this will be the first time the two militaries will participate in joint counter-terrorism drills. [Geo TV].

ASEAN Summit: South China Sea issue on the schedule – Rohingya issue most likely not

(ls) Southeast Asian leaders will focus on trade wars and security tensions in the disputed South China Sea at the 32nd ASEAN summit in Singapore this weekend. ASEAN hopes that a code of conduct it is currently negotiating with China will ease the dispute in the South China Sea. Critics have said the code, which is expected to be non-binding, would only be an incremental step since it would not force China to back-track on its moves. Referring to the Rohingya crisis, Singapore Foreign Minister Vivian Balakrishnan said before the summit, “the political responsibility and accountability have to be with the Myanmar government. They have to find a political solution.” [Reuters]

However, ASEAN Parliamentarians for Human Rights have urged Southeast Asia’s leaders in an open letter to address pressing human rights issues when they meet. They asked ASEAN not to overlook human rights concerns, even as the regional grouping focuses on tackling regional security challenges and promoting economic integration. [The Straits Times]

Myanmar’s unofficial leader Aung San Suu Kyi will not attend the summit. This is the first time for her to skip a summit since her party came to power in 2016. A government spokesman did not explain why Suu Kyi, who has dual roles of state counsellor and foreign minister, will miss the summit and whether it might be due to criticism of her and the government’s handling of the Rohingya refugee crisis. [South China Morning Post]

Ahead of the summit, The Diplomat has received draft copies of two important policy documents that are set to be released at the conclusion of the summit: the ASEAN Leaders’ Vision for A Resilient and Innovative ASEAN and the Zero Draft of the Chairman’s Statement of 32nd ASEAN Summit. Carl Thayer provides a summary of the two papers. [The Diplomat]

South China Sea: Philippines quiet over Chinese advancements

(ls) The Philippines’ have opted to say little for now about China’s recent activities in the South China Sea, including its erection of a monument on Kagitingan Reef and landing military planes on Mischief reef within the Philippines’ exclusive economic zone (EEZ). Philippine lawmakers said the landings were not just an affront to Philippine sovereignty but could be a precursor to the deployment of long-range bombers and fighter aircraft to the reefs that China has transformed into artificial islands. [The Straits Times]

Cross-Straits relations: Taiwan simulates assaults on island in upcoming military drills

(dql) Following China’s massive show of military force in the South China Sea and the Taiwan Strait in the recent weeks [Air 4/4/2018], Taiwan will conduct life-fire exercises in June, simulating surprise coastal assaults to reflect increased military threats from Beijing, Taiwanese officials revealed. [South China Morning Post/Reuters]

Meanwhile, the spokesman of the Chinese Defense Ministry confirmed on Thursday that a new missile, dubbed the “Guam killer” for its ability to hit the U.S. Pacific Ocean base with a conventional or nuclear warheads, has been put in service. [ABC News]

China: National security whistle-blower website launched

(dql) China’s Ministry of State Security on Sunday launched its online ‘State Security Reporting Platform’ and established a ‘hotline’ telephone number providing the public channels to report potential threats to national security, including – among others – bribery of state officials, fomenting armed riots or ethnic separatism, leaking state secrets, and foreign espionage. Under the guidelines of the platform, those delivering successful tip-offs will be rewarded and those giving false information punished. [South China Morning Post 1] [Business Insider] For the complete list of targeted actions see [State Security Reporting Platform, in Chinese]

Meanwhile, President Xi Jinping at a closed meeting of the Central National Security Commission, China’s national security strategy agency headed by himself, on Tuesday voiced satisfaction about the work of the Commission in the past years saying that it successfully “improved the strategies of national security, and established mechanisms for coordinating relevant work” and urged the agency to continue “to fully implement a holistic approach to national security and break new ground in national security in the new era.” [Xinhua] A number of national security related laws have been passed since the establishment of the Commission in 2014 raising concerns over the party’s tightening grip on human rights and social control as well as Beijing’s assertive foreign policy. [South China Morning Post 2]

Among those laws is the 2015 National Security Law which imposes on Chinese citizens an obligation to contribute to the protection of national security on the basis of a very broad notion of national security covering not only traditional areas of political of military security, but also nuclear security, social, economic and ecological development, as well as cultural and ideological control over the public. [National Security Law 2015, in Chinese]

China-US relations further strained: US Department of State 2017 Country Reports of Human Rights Practices and trade dispute

(dql) The US Department of State 2017 Country Reports on Human Rights Practices [US Department of State] released on Friday describe China (along with other countries) as ‘morally reprehensible” and undermining US interests arguing that the “Governments of China, Russia, Iran, and North Korea, for example, violate the human rights of those within their borders on a daily basis and are forces of instability as a result”.

The Reports come amid increased tensions between Beijing and Washington over an ongoing trade dispute in a latest development of which the Trump administration has announced that it is considering declaring a national economic emergency and invoking the International Emergency Economic Powers Act to curb Chinese investments in U.S. technology companies. [Financial Times]

China-EU relations: Uncertainties ahead

(dql) Relations between China and EU are facing uncertainties after 27 out of 28 European Ambassadors to China signed a report denouncing China’s One Belt, One Road (BRI) project as aiming at hampering free trade and putting Chinese companies at an advantage. [Handelsblatt]

The Hungarian Ambassador refused to sign the report, an understandable move given Hungary’s reliance on a BRI-loan to finance the Belgrade-Budapest railway project. [The Economic Times]

Meanwhile, officials of European Union and Italian authorities confirmed investigations into a suspected massive tax evasion case by Chinese criminal gangs importing goods via Greece’s largest port of Piraeus, a trade gateway between China and Europe majority-owned by  China’s state-owned COSCO Shipping since 2016. [Reuters]

Japan: Diplomatic missions to US and China with mixed results

(dql) Prime Minister Abe’s visit to Washington this week brought mixed results. While he was reassured by Trump that Japan’s security concerns would be communicated during his impending meeting with North Korean leader Kim Jong-un, he failed to achieve his main economic and trade related goals, name an exemption from new U.S. tariffs on steel and aluminum and the USA’s return to the Trans-Pacific Partnership trade deal. [The Washington Post]

Meanwhile, during the visit of Chinese State Councilor and Foreign Minister Wang Yi to Japan, both Foreign Ministers agreed to increase efforts to improve economic ties between both countries and to stick with U.N. resolutions aimed at putting pressure on North Korea’s denuclearization.

Wang’s visit is the first visit of a Chinese foreign minister to Japan in a bilateral context in the nine years and reflects recent developments of improving Sino-Japanese ties. [The Diplomat]

Cross-Strait relations worsen over Beijing’s naval drills

(dql) In a move further souring the already strained relations between China and Taiwan, the People’s Liberation Army navy this week conducted military exercises in the Taiwan Strait and in the Western Pacific Bashi Channel between Taiwan and the Philippines. [The Washington Post] [South China Morning Post]

This move comes a week after China’s navy held its largest parade ever in the South China Sea involving  48 ships, among them the aircraft carrier Liaoning, around 50 other vessels as well as more than 10,000 troops and close to 80 aircraft, including jets, bombers and early-warning planes. [AiR 3/4/2018]

In a related development, China Aerospace Science and Technology Corp, the state-owned main contractor of China’s space program, revealed that China is working on drones capable of taking off from and landing on aircraft carriers as part of a move to bring the country’s drone and aircraft carrier programs together. [Popular Science]

Meanwhile, four-star Admiral Phil Davidson, nominated to become the new commander of the US Pacific Command, warned that China has the capability of controlling the South China Sea after it has deployed electronic attack systems and other military facilities on disputed islands in the South China Sea. [The Washington Free Beacon]

China proposes India-Nepal-China economic corridor as South Asia remains strategic hotspot

(ls) China on Wednesday proposed an India-Nepal-China economic corridor with multi-dimensional connectivity through the Himalayas as it seeks to expand its influence over the new Nepalese government headed by Prime Minister K. P. Sharma Oli, widely regarded as pro-Beijing. China’s proposal came after visiting Nepalese foreign minister Pradeep Kumar Gyawali held talks with his Chinese counterpart Wang Yi. During his last tenure as Prime Minister, Oli signed a transit treaty with Beijing in 2016 ending the decades-long dependence on India for commodity and energy supplies for his land locked country. He also sought railway connectivity between the two countries through Tibet which China is currently building. [Livemint]

S.D. Muni analyzes India-Nepal relations in the light of Oli’s recent visit to New Delhi. He describes how Oli discarded the widespread notion of Nepal’s dependence on India and repeatedly underlined the importance of sovereignty, equality, non-interference and interdependence in Nepal’s dealings with India. Muni argues that India eighbor that there is a limit to its muscular and aggressive diplomacy, which has alienated one after another eighbor and been exploited by China to its advantage in South Asia. He holds that India’s attempts to reach out to Oli have, therefore, been a serious exercise towards course correction in its neighbourhood approach. [The Wire]

An assessment by Stratfor sums up current India-Nepal-China relations, holding that Nepal has little choice but to maintain cordial relations with India given the deep economic and cultural links across their open border. India’s diminishing ability to influence Nepalese politics, however, points to its declining power in South Asia as China’s presence in the region expands through the Belt and Road Initiative. [Stratfor]

Pakistan: Pakistan cuts dependence on US weapons, turns to China 

(ot) Pakistan has shifted its reliance from the United States to China for high-tech weapons, according to a report by the Financial Times. The move reflects a change in policy which will have repercussions on the geo-political situation in the region. The shift started as the US Congress blocked the sale of eight F-16 fighter jets to Pakistan during the last few months of the Obama administration. The country turned to China to co-develop and jointly manufacture the JF-17 fighter jet, compatible with the US-made F-16, with complete transfer of technology. Since 2010, US weapons exports to Pakistan have plummeted from 1 billion USD to 21 million USD last year. During the same period, exports from China have also fallen, but more slowly, from 233 million USD – 747 million USD to 514 million USD, making it the biggest weapons exporter to Pakistan. The Trump administration also suspended 2 billion USD in military aid. [The Express Tribune]

Pakistan has been procuring weapons from China since the US placed an arm embargo on the country during the 1965 war with India. In 1990s, China also helped Pakistan in developing nuclear weapons and provided missiles, capable of carrying nuclear warheads. China-Pakistan relations have also strengthened following the launch of multi-billion USD project China-Pakistan Economic Corridor (CPEC). [Daily Pakistan]

Sri Lanka: China’s geo-strategic investment into the empty port of Hambantota

(ls) The Hambantota port in Sri Lanka, built with Chinese money and an example of President Xi Jinping’s Belt and Road trade and infrastructure initiative, sees almost no container traffic. Sri Lanka borrowed from China to build the port, could not repay the loans, and then gave China a 99-year lease for debt relief. The port’s weak performance has fuelled impressions that it simply serves China’s broader strategic interests to secure crucial trade routes and international supply chains. [The Straits Times]

China this week dismissed speculation that the Belt and Road Initiative had a military dimension, with a foreign ministry spokeswoman saying it was “open and transparent.” Hambantota was mutually beneficial and would aid Sri Lanka’s economy, she said. [The Print 1]

However, new research by Washington-based nonprofit research group C4ADS suggests a clear political agenda behind the initiative, aided by the exercise of ‘corporate obfuscation’ by the Chinese companies involved. Quoting unofficial Chinese reports, the authors said the ports were chosen to build political influence and create “strategic support states”. [The Print 2] While there is no official policy document linking Belt and Road to China’s national security interests, Chinese analysts have written that developing the program and pursuing Chinese security are “intimately linked,” the report said. [The Economic Times]

South China Sea

(jk) With increased Cross-Strait tensions and Taiwan climbing up the list again of most-concerning flashpoints in East Asia, the attention of international news reporting has slightly shifted away from South China Sea issues. Notwithstanding, there are plenty of stories that are worth keeping an eye out for.

Last month, state-owned enterprise PetroVietnam withdrew its consent for Spanish energy firm Repsol to move ahead with a drilling project in Vietnman’s exclusive economic zone (EEZ) of the South China Sea. This is the second time that Repsol could not move on with an already well prepared and heavily invested in drilling project after a similar incident in July last year.

It is reported that coercion by the PRC, such as the threatening of military clashes should the drilling go ahead were to blame for the sudden pull of the plug of the project by Vietnam. Observers are concerned that for a second time, the PRC has coerced a littoral SCS state into not exploring resources within their EEZ.  Apparently, recently improving ties between Vietnam and the US did not instill enough confidence in Vietnam’s leadership for them to go ahead with the project [BBC News; South China Morning Post 1]. It is worth remembering that as we have noted in AiR before, Vietnam has become the most forward leaning of the claimant states in the SCS vis-à-vis China. Now, after the Repsol episode, Vietnam is negotiating with China on joint exploration and production efforts.

In the meantime, Vietnam and Indonesia are working towards a mechanism to deal with fishing violation in their respective territorial waters which could turn into a positive example of cooperation amongst claimant states and so-called “interested parties” such as Indonesia. Over the past few years, Indonesia has destroyed hundreds of fishing vessels from Vietnam, the Philippines, Malaysia and Thailand, for violating its waters. Last week, the two nations sat down as part of their third installment of a bilateral cooperation committee meeting which focused on maritime security in particular [South China Morning Post 2].

In the Philippines, photographs of Chinese military aircraft on one of the artificially developed islands within the Philippines’ EEZ have raised doubts about China’s official line not to further militarise any of the South China Sea features it has built. The pictures were allegedly taken in January this year and have now been verified by the government in the Philippines which is now considering filing an official complaint. China’s seems to keep to its successful strategy of creating facts on the ground [The Straits Times]. Despite its competing claims in the Spratly chain, the Philippines is increasing its economic ties with China. This includes plans for joint developments of gas and oil.  President Duterte and President Xi agreed on this last week in a meeting in Hainan.

Annual Philippine-US military drills to include Japan and Australia 

(jk) This year’s US-Philippine “Balikatan” (shoulder-to-shoulder) military exercises will include Japanese and Australian forces for the first time. Last year, the US – Philippines exercises were scaled down amid some strategic re-alignment under President Duterte who has also invited Chinese and Russian forces for exercises [The Straits Times].

Book review of Robert Bickers’ “Out of China”

(ls) Jeremiah Jenne reviews Robert Bickers’ 2017 book “Out of China. How the Chinese Ended the Era of Western Domination”. The focus of the book is on the foreign presence in China, but it is also about China’s search for national and individual dignity and the quest for a new national identity, one which is both fully modern and fully Chinese. In the book, Bickers picks up the story of foreigners and foreign influence in China from the end of the first World War through the wars and upheavals of the mid-20th century to the rise of a resurgent China – and a resurgent Chinese nationalism – in the post-reform era. [Los Angeles Review of Books]

China’s anti-corruption campaign: Former top leadership contender on trial

 (dql) In another high-profile case of President Xi Jinping’s sweeping anti-corruption campaign, the First Intermediate Court in Tianjin on Thursday opened the trial against former politburo member Sun Zhengcai on charges of accepting bribes amounting to more than 27 million USD. Sun, sacked from his post as party chief of China’s fast-growing mega-city Chongqing with a population of 30 million ahead of the leadership reshuffle last October where he was expected to join the Communist Party’s Politburo Standing Committee, pleaded guilty. Last September, he had already been dismissed from party and public office.[South China Morning Post]

Boao Forum for Asia: Asia to lead world growth

(hg) Asia has maintained stable growth and is expected to lead the world in economic development amid moderate recovery of major economies, said the “Asian Competitiveness Annual Report 2018,” a Boao Forum for Asia (BFA) report, released last week. [Xinhua]

Founded in 2001, the Boao Forum for Asia is a non-profit NGO that is modelled on the World Economic Forum in Davos. It hosts high-level forums for leaders from government, business and academia in Asia and beyond to share their vision on the most pressing issues in Asia and the world at large. Located in Bo’ao, Hainan, its Secretariat is based in Beijing which had also been instrumental to its foundation. [Boao Forum]

The 17th annual Boao Forum for Asia just concluded having elected former UN Secretary General Ban Ki-moon as its new chairman. [Ban Ki Moon Foundation]

This year´s forum was significant as  a window onto Chinese President Xi Jinping’s economic plans for the next five years which would normally have been announced in more detail earlier in the year at the Communist Party’s forum which has this year been occupied though by the major constitutional reform Xi had initiated. [Forbes]

Noteworthy among the speeches at this year´s BFA was also Singapore´s Prime Minister Lee Hsien Loong speech in which the Singaporean leader also referred to to current US trade policy: “A trade war between China and the US is still far from inevitable. But if one does happen, it will undermine the multilateral trading system which has underpinned global prosperity. Countries big and small will be affected.” His full speech can be found at the [The Straits Times]

China-US relations: Trade tensions continue to strain bilateral ties

(dql) Following last week’s tit-for-tat tariff impositions, the trade dispute between China and the US continues to dominate bilateral relations.

Undersecretary for International Trade at the US Commerce Department Gilbert Kaplan voiced fierce critic against China at the China Institute’s Executive Summit in New York this week accusing the world’s second largest economy of “stealing American intellectual property and engaging in commercial cyber espionage”. At the event, attended by top U.S. and Chinese CEOs, government leaders, and experts, Kaplan reasserted Washington’s opposition to Beijing’s continuation of non-market trade and industrial policies, stressing at the same time that the US is not seeking a “combative or adversarial long-term relationship with China”.  [South China Morning Post 1]

Meanwhile, US Senators in a Senate hearing denounced China for using trade as weapon and coercive instrument, doing “anything legal or illegal, anything moral or immoral, anything ethical or unethical to get ahead and to stay ahead,” Testifying lawmakers warned against China’s advancing in technological innovations with some of them “the most historic in human history” and a  China which would do “things that are both legitimate and illegitimate to put its thumb on the scale in favour of its local champions so they can corner the market on the frontier innovations of the future.” [South China Morning Post 2]

CIA Director and President Trump’s nominee for Secretary of State Mike Pompeo warned at his hearing for Secretary of State before the Senate Foreign Relations Committee that China’s Road and Belt initiative is designed to not only create trade opportunities, but to make participating nations “economically, politically and eventually militarily dependent on and vulnerable to China.”[The Economic Times]

South China Sea I: Sino-US military muscle flexing

(dql) In a move reflecting Beijing’s unabating assertiveness in the South China Sea (SCS), China’s government announced live-fire exercises of the PLA in the Taiwan Strait next week, just a few hours after the conclusion of China’s biggest naval parade in the country’s history, which was reviewed by Xi Jinping. Presented at the parade were the aircraft carrier Liaoning, around 50 other vessles as well as more than 10,000 troops and close to 80 aircraft, including jets, bombers and early-warning planes.  [The Times UK]

The parade was part of a three-day drill of the PLA close to its main submarine base on the south coast of Hainan province. It followed the conclusion of a week-long military drill in the South China Sea that had begun last week. [South China Morning Post 1]  At the same time,  US carrier Roosevelt  sailed through the South China Sea as well, a nuclear-powered carrier, accompanied by its 65 supersonic F18 jets, spy planes and helicopters, en route to Manila. [Navy Times]  

Meanwhile, four-star Admiral Phil Davidson, currently head of the US Fleet Forces Command, has been nominated as the new head of the US Pacific Command by Defense Secretary James Mattis, the Pentagon announced on Thursday. [Defense News] The nomination of Davidson, a specialist in anti-submarine and electronic warfare, suggests in the eyes of analysts the Pentagon’s reaction to China’s rapid advancement of submarine capabilities. Increased American Navy’s activity in the area of anti-submarine and electronic warfare are to be expected. [South China Morning Post 2]

Furthermore, Taiwan’s Ministry of National Defense (MND) announced that the Trump administration has approved a marketing license enabling US industry to transfer submarine-related expertise to Taiwan, a significant step to help Taiwan implement an indigenous submarine fleet program of between six to eight boats. [Jane’s 360]

In a related development, US officials claim that China has installed military jamming equipment on fortified artificial islands in the South China Sea, which will allow Beijing to block enemy radar and communications systems as Beijing´s latest step to militarize its island bases. [Newsweek​]

South China Sea II: China-Philippines joint exploration in disputed areas on the way

(dql) China and the Philippines have agreed to work on a legal framework for joint explorations in the South China Sea, including disputed areas. While the agreement confirmed by Philippine President Duterte upon his return to Manila from the Boao Forum (see above) is in line with the Duterte’s rapprochement with China and earlier talks on joint exploration of gas and oil in the South China Sea, it will complicate regional talks for a code of conduct for the South China Sea. [Nikkei Asian Review]

In a related move, Presidential spokesperson Harry Roque announced Chinese President Xi Jinping’s visit to the Philippines, scheduled for November. It the first time Xi will come to the country under the more friendly administration of President Rodrigo Duterte. [Inquirer.Net]

Sri Lanka: Chinese firm about to invest $800 million on Port City

(hg) China Communication Construction Company (CCCC) through its subsidiary, the state-run China Harbour Engineering Company (CHEC), will invest $800 million to build an underground road network to Sri Lanka’s Port City, a $1.4 billion project built on reclaimed land, a government minister said. Reclamation work for the 269-hectare site near Colombo’s main port is more than 60% complete, expected to be complete by the end of the year. Seen by China as a strategic node in its Belt and Road Initiative, Port City will have housing, marinas, health facilities and schools. Once completed the Port City will function as a separately governed entity with its own economic and commercial laws to facilitate operations of global multinational corporations. [Colombo Page] [Reuters]

India, China talk disarmament

(ot) On Tuesday, India and China held the fifth round of the Disarmament and Non-Proliferation Dialogue in Beijing, despite China’s continuing opposition to India’s entry to the Nuclear Suppliers Group (NSG), a group of nuclear supplier countries seeking to contribute to the non-proliferation of nuclear weapons. China has repeatedly refused to accept India to join the 48-member NSG on the ground that India has not become party to the Nuclear Non-Proliferation Treaty (NPT).

The dialogue intended to be a platform for both countries to find common ground on disarmament issues. According to a statement issued by the Indian Embassy in Bejing, the countries exchanged views on developments related to disarmament, non-proliferation, nuclear issues, and the role of science and technology in international security, disarmament and outer space. However, the statement did not mention India’s NSG membership. [Hindustan Times]

China and India’s geopolitical tug of war for Bangladesh

(hg) Another perspective on the ongoing battle for influence between China and India in Bangladesh is presented by East Asia Forum in an article analysing areas such as infrastructure investments and military spending. The article stresses that Chinese/Indian FDI still develops only limited tangible results from a Bangladeshi perspective. In terms of military spending, relations are traditionally fostered with China, while India is trying to catch up although Indian arms offers are said to be still being hampered by the reputation of Indian defense products. While India´s cultural influence in Bangladesh is overwhelming, China steadily increases its commercial foothold. The article also links geopolitical competition to domestic politics and highlights that both India and China are widely seen in the country as still taking more than giving. [East Asia Forum]

Maldives: Ex-Pres. urges strong foreign intervention, amid Pentagon concerns over Chinese influence

(hg) The geopolitical stakes in the Maldivian constitutional crisis could rise again.

The domestic crisis that is lingering on while presidential elections are approaching is strongly intertwined  with geopolitical competition  due to the allegiance of the warring parties either to India or China. While the US and UK supporting demands of the pro-Indian opposition, Pakistan has recently entrenched relations with pro-Chinese government of President Yameen. His administration has broken with the traditionally close relation to India and supports a fast growing Chinese presence. A thousand-page free trade agreement with China having approved by the Maldivian parliament last December after just an hour of debate, substantiated rumors of Chinese bass-building plans and a withdraw from defense relatiosn to India are the manifest signs of this trend

The domestic opposition President Yameen is facing is partly composed by a breakaway faction of his own party led by his half-brother and decade long dictator Gayoom and the Western-oriented former president Mohammad Nasheed who lost power and became sentenced after he arrested some judges before he went to exile in the UK and Sri Lanka. Now, with another judicial crisis, judges are arrested again, this time by incumbent president Yameen who accuses his half-brother to have prepared a coup d´état. [Open democracy]

In this situation, after the domestic upheaval seems to have slightly settled, self-exiled opposition leader Nasheed reiterated once more, the Maldives would be “’in need’ of strong foreign intervention”.  [Avas]

Not long ago, Nasheed has called for a military intervention by India and also urged the US to prevent a “reversing” geopolitical reality  regarding  the growing Chinese influence, he described as a sell-out to Beijing. Nasheed also claimed an increasing Islamic radicalization against which he called to take immediate action.

US president Trump had discussed the Maldivian crisis with Indian Prime Minister Modi over phone early February both expressing concern. The US, however, was generally understood til now to have let India assume lead position on Maldives as it is situated in what Delhi would (like to) claim its sphere of influence. [Hindustan Times]

The major news against this background is a recent Pentagon statement.

Responding to the mentioned allegations China would engaging in massive land grabbing, the Pentagon claimed it would be a cause for concern for the US and its commitment to a free and open Indo-Pacific rules-based order:  “We have seen concerning developments in Maldives as far as the Chinese influence is concerned,” Deputy Assistant Secretary of Defense for South and Southeast Asia, told. “It’s in India’s backyard. We know it’s of concern to India. So, yes, [the situation in the Maldives] is a concern. We will see how it plays out. It emphasizes some of our priorities identified in our National Defence Strategy, […] From Djibouti to, Gwadar portt to Hambantota port in Sri Lanka, and now potentially the Maldives and then extending further east, it’s of concern”. [The Economic Times] 

Is Vanuatu becoming the next Maldives? PM defends China deals but vows to oppose military base

(hg) Vanuatu’s Prime Minister has vowed to “fiercely oppose” any push to build a foreign military base on the South Pacific island nation, while also defending his government’s close ties to “friend and global leader” China amid reports about China’s ambitions to establish a permanent military presence in the South Pacific island state.

Beijing has showered Vanuatu with its round 270,000 population with hundreds of millions of dollars in development money over recent years raising security concerns in Canberra and Washington. Meanwhile, the US announced that the commander of its Pacific fleet, Admiral Scott Swift, was cancelling a visit to Australia because of “unforeseen circumstances”.

Bone of contention is a new wharf at Luganville port on a northern island of the archipelago which was built by a Chinese company and paid for by a concessional loan from Beijing. Defense experts fear, it could be used to dock Chinese warships in the future as well.

Currently, Australian-China relations are worsening again amid fallout from Canberra’s foreign interference laws and Beijing’s growing influence in the Pacific as Prime Minister Turnbull told, whose government did not attend the annual Boao Forum in China this year.

It is difficult to say how substantial fears  of a dual use facility or outright military base in Vanuatu are in the future. As a matter of fact, Luganville port, where the contentious wharf is situated, has been the site of one of the largest military bases in the entire Pacific Theatre during WWII. Noteworthy, whoever controls Vanuatu controls air and sea traffic between the US and Australia. Right now, as Dan McGarry remarks, that’s the government of Vanuatu. [The Sydney Morning Herald]

India/Nepal relations reset?

(hg) The recent visit of Nepali Prime Minister K.P. Sharma Oli’s to India does not reverse an increasing closeness of his country to China but indicates that relations to India are also not in free fall.

In how far the attempted recalibration of bilateral ties will turn out to carry weight, especially with respect to the Chinese influence in Nepal, remains to be seen. Notably, the small and poor Nepal has yet another stature in Delhi due to the Chinese alternative. After all, the talks have been focused on connectivity and infrastructure instead of domestic Nepali politics, an area of keen Indian interest in the past.

Both leaders have reached an understanding to connect Nepal with India’s vast railway network and thereby with the sea, agreed at a time when it is foreseen that China’s Tibet railway will arrive at the Nepal northern border in 2020. Acknowledging the shared historical and cultural links Oli and Modi also inaugurated an Integrated Border Check Post and a cross-border oil pipeline, reached an understanding to expedite a much-delayed river project, a road network and a partnership in agriculture. The 69-kilometer pipeline to transport petroleum from the Indian state of Bihar to Nepal is expected to deliver 200 million tons of petroleum products to the energy hungry Nepal. [The Hindu] [Nepali Times]

Despite the recent reset, Kathmandu still joins Beijing’s “One Belt, One Road” plan showing no sign to decrease its openness to China. Delhi, on the other hand, has achieved what it could achieve even if  that simply did not include a reset to Indian hegemony. India may keep some significant influence in Nepal, but it can hardly keep the country within its sphere of influence as matters stand.

Nepal reassuring Beijing

.() While the prime ministers of India and Nepal met in Delhi, former Nepali Prime Minister Madhav Kumar, leader of Prime Minister Oli´s political party, CPN (Maoist Centre) – UML, has visited China to participate in the Shanghai Co-Operation Organisation (SCO) People’s Forum on ‘Promoting Regional Peace: Jointly Building a Community of Shared Future for Mankind’ attended by leaders from Nepal, India, China, Cambodia, Sri Lanka, Pakistan and Turkey. [The Kathmandu Post] [The Himalayan Times]

The former PM and incumbent Nepali communist party head said that bilateral agreements with China would be implemented soon, adding that his Chinese counterparts were happy about the unification of the two Nepalese communist parties. Chinese party leaders are invited to participate in the party unification celebration planned for April 22. Soon China´s President Xie will also visit Nepal. [Kathmandu Tribune]

Challenges and prospects for the BRI in Vietnam

(jk) A brief ISEAS “Perspective” piece that looks at the Belt and Road Initiative and how it is likely to fare in Vietnam. Vietnam has been sceptical towards Beijing’s possible ulterior motives given its history with the PRC and strategic competition particularly in the South China Sea. Nonetheless, infrastructure projects are badly needed and Hanoi by no means rules out doing more business with China. It has alternatives however, so it is not in a position where it has to agree to “bad deals” on loans and projects as sometimes proposed by the PRC [ISEAS].

Control of religious life in China: Bible online sales stopped

(dql) In a move of the Chinese government to close a loophole in its system of control over religious affairs, Bibles have been removed from the assortment of big online retailers, with searches for the book on China’s largest e-commerce platforms, such as Taobao, JD, Dang Dang or Amazon.cn, ending up in ‘no result’ or recommendations for other Christian books. [South China Morning Post]

This move is line with new laws regulating religious affairs which came into force on 2 February and have been criticized by Chinese religious leaders for allowing too much oversight and control of the state over of religious life, including discussion of religious matters on social media, religious gatherings, the financing of religious groups, the construction of religious buildings and religious education. [The Tablet]

But the ban on online Bible sales also comes amid a recently intensified dialogue between the Vatican and Beijing towards a highly disputed agreement on the appointment of bishops in China. Critics of these negotiations denounce the potential deal for selling out the Catholic underground worshippers who have remained loyal to the pope and defied the official state-sponsored Catholic Church. [AiR 1/4/18]

Meanwhile, the China’s State Council on Tuesday released the White Paper “China’s Policies and Practices on Protecting Freedom of Religious Belief” reassuring that China’s ‘religious education system has been further improved.’ It identifies 200 million of religious population with Protestants numbering over 38 million and state-organized Catholics about 6 million. Catholic underground worshippers believed to amount to the same number are not covered. The White Paper also states that China has printed over 160 million copies of the Bible in more than 100 different languages for over 100 countries and regions, including 80 million copies printed in the Chinese language, 11 ethnic minority languages and braille for churches in China. [Xinhua 1 for the complete White Paper in Chinese] [Xinhua 2 for a summary of the White Paper in English]

Asia: US interest/US concerns

(hg) An interesting perspective on the US strategy towards Asia has been taken in the [The National Interest]. With a view on an economical primate, it highlights the high stakes the US still have in the larger region. Irrespective of having pulled out of the Trans-Pacific Partnership (TPP) free trade agreement, the US are in fact decisively seeking to balance against a rising China under the label of a ‘Free and Open Indo-Pacific’ Strategy and especially by leveraging a growing India as a counterweight to China. In doing so, the US continues established Western strategies in its commitment to a normative conception of freedom that is substantially underpinned by Western values centered at good governance as manifest in terms of fundamental rights, transparency and anti-corruption. At the same time, so the article, it has become clear that parts of the Trump administration do effectively frame American grand strategy by national economic interest which would render a trade deal that has strategic value but no benefit for the American economy of only limited value. [The National Interest]

As much as this reflects an obvious ‘American business first’ strand in President Trump´s foreign policy, it might, however, be doubted that economic benefit would ultimately trump security. Contrary, the new US national security strategy regarding great power competition, not terrorism, as the central challenge to US security and prosperity looking at China and Russia as the major adversaries will arguably develop the decisive momentum in engaging the Indo-Pacific, not a ‘business first’ policy.

Secretary of the US Army, Mark Esper, a former vice president for government relations at Raytheon, a major US defense contractor company, stated last week: “The future we face is increasingly uncertain. China and Russia, which have been identified as our strategic competitors, as part of this era of great competition … are modernizing. They are eroding our overmatch, and they are improving their ability to threaten our interests.” [The Daily Signal] and for a video clip [The Heritage Foundation]

The weight and implications of the present shift in security strategy are huge. A recent article of Michael T. Klare in [The Nation] claims “The screaming headline you should have seen in any paper (but haven’t) is this: The US military has made up its mind about the future. It has committed itself and the nation to a three-front geopolitical struggle to resist Chinese and Russian advances in Asia, Europe, and the Middle East”. For the Indo-Pacific theater, PACOM Commander Adm. Harry Harris Jr., has just painted a grim picture of America’s strategic position in the region, highlighting that China was emerging as a formidable threat to America’s vital interests with People Liberation Army´s capabilities “progressing faster than any other nation in the world, benefitting from robust resourcing and prioritization.” [The Nation]

At multiple points along the Eurasian maritime zone – at the Baltic Sea, the Black Sea, the South China Sea, and the East China Sea – US forces “are already in significant contact, often jostling for position in a potentially hostile manner. At any moment, one of these encounters could provoke a firefight leading to unintended escalation and, in the end, possibly all-out combat. From there, almost anything could happen, even the use of nuclear weapons.” [The Nation]

Against this background, two recent assessments of risk scenarios concerning the South Pacific and the East China Sea are interesting.

Being less in focus of conventional risk assessments, the South Pacific remains strategically vital to the US for two key reasons that are lastly forming two sides of the same coin, the interests “to prevent the emergence of a regional hegemon” and the maintenance and expansion of the US sphere of influence under the label of a ‘Free and Open Indo-Pacific’.

Interestingly, Charles Edel, a senior fellow at the United States Studies Centre and former associate professor of strategy and policy at the US Naval War College, has voiced concern that the three Pacific Island nations of Micronesia, the Marshall Islands, and Palau which are joined with the US in Compacts of Free Association that are allowing the US a strategically highly important military presence in the Pacific might come under eventually disruptive stress. [War on the Rocks]

More manifest, however, seem concerns of increasing conflict in cross-strait relations and the Est China Sea as recently expressed by a panel of maritime experts from the US, Japan and Germany hosted by the Atlantic Council in Washington. From this perspective, China is seen as stepping up both its submarine presence in the East China Sea and its use of aerial drones for intelligence collection operations, while it is also said to engage in almost daily probes of Japan’s air defense including simulated cruise missile attacks on Japanese mainland. The said panel expressed in particular concern that President Xi Jinping could act towards Taiwan as President Putin did towards Crimea. Such a perception is even more significant as President Trump’s new national security adviser, John Bolton, is a strong opponent of the US ‘One China’ policy anyway (and one of Washington´s most hawkish security experts). [Asia Times]

South China Sea: China tries to counterbalance US influence in Vietnam

(ls/dql) China and Vietnam vowed to keep the peace in the South China Sea. “Both sides should not apply unilateral measures that would complicate the situation,” China’s Foreign Minister Wang Yi said in Hanoi during an official visit to Vietnam. His Vietnamese counterpart Pham Binh Minh said, “we are ready to work with China to resolve arising issues.” The meeting came at a time when Vietnam has publicly promoted deepening security ties with the US in recent weeks. Earlier this month, a US aircraft carrier made a historic visit to Vietnam and last week Washington handed over six patrol boats and equipment to Hanoi. [The Straits Times]

Meanwhile, Beijing in a latest show of military might launched on Thursday an unprecedented week-long series of live-fire exercises in the South China Sea, involving the aircraft carrier Liaoning and up to 40 other vessels, which will converge with three US aircraft carrier battle groups Washington has sent to the South China Sea to prepare for their own exercises. [Nine News]

Furthermore, sources close to the military revealed this week that China’s first home-built aircraft carrier, the Type 001A Shandong, is ready for its maiden sea voyage, possibly scheduled for April 23, just before the 69th anniversary of the founding of the PLA Navy.  With a capacity to carry up to 24 Shenyang J-15 multirole fighter jets as well as around ten rotary wing aircraft, the Shandong is believed to serve in the PLAN’s North Sea Fleet or East Sea Fleet and deployed for regular carrier strike group operations. [The Diplomat]

China-US trade tensions escalating

(dql) The tit-for-tat escalation of the US-China trade dispute is gearing up. In the latest development of trade tensions between Beijing and Washington, China warned on Friday that it was fully prepared to retaliate with fresh trade measures after US President Trump on Thursday instructed the United States Trade Representative to consider 100 billion USD in additional tariffs against China. Trumps’ threat of theses new tariffs itself followed a list of 106 U.S. goods including soybeans, whiskey, frozen beef and aircraft targeted by the Chinese government for tariffs, revealed on Wednesday just hours after the Trump administration proposed duties on some 1,300 Chinese industrial, technology, transport and medical products. [Global Times] [Reuters] [Financial Times]

Meanwhile, California-based cyber-security company Fire Eye reported on Wednesday increased attacks of state-controlled Chinese hackers against U.S. companies for financial espionage, aiming at acquiring information related to bid prices, contracts and mergers and acquisitions. [Bloomberg]

Japan: New defense era?

(dql) In major ocean policy shift, the Abe administration has come up with a proposal shifting the focus of Japan’s basic ocean policy from resources to security and elevating coastal security and remote-island defense to top policy priority. The proposal identified as reason for the shift from the current focus on maritime resources development and management repeated intrusions of Chinese government ships and warships into Japanese waters as well as North Korea’s firing of missiles into Japan’s exclusive economic zone. The draft highlights the importance of the creation of a maritime domain awareness system for sharing information collected by Japanese government agencies and other countries used for monitoring unidentified vessels and handling natural disasters. More specifically, it seeks to strengthen radars set up on Self-Defense Forces aircraft and along coasts and utilizing advanced satellites belonging to the Japan Aerospace Exploration Agency (JAXA). [The Japan Times]

The announcement of the policy shift plan comes after Japan’s Ground Self-Defense Force (GSDF) on Wednesday celebrated the launch of its first ever full-fledged amphibious force with a ceremony as Japan grapples with the task of defending its remote islands in the southwest amid China’s growing maritime assertiveness. The Amphibious Rapid Deployment Brigade, dubbed the Japanese “Marines,” starts with around 2,100 members is part of the GSDF’s largest-ever organizational overhaul [AiR 1/4/2018] made in an attempt to deal more flexibly with the shifting regional security environment. [NHK World]

Asia and UK/US-Russian tensions: China to support Russia

(hg) The poisoning of the former Russian military intelligence (GRU) colonel Sergei Skripal, who became a British spy, and his daughter with a nerve agent that has been invented in the Soviet Union in Cold War times has triggered one of the worst crises in East-West relations since the end of the Cold War. While the unprecedented expulsion of Russian diplomats highlights an intensifying Russian isolation in large parts of the Western world, the affair seems to have developed in a different direction in other parts of the world, including Asia. This could be observed on occasion of the 7th ‘Moscow Conference on International Security’ that has just taken place on April 4-5. As a sort of Russian pendant to the Munich Security Conference it hosted delegations from 95 countries, including 30 defense ministers and 15 chiefs of general staff, including Chinese Defense Minister Wei Fenghe, Indian Defense Minister Nirmala Sitharaman and Iranian Defense Minister Amir Hatami as speakers.

The Russian defense minister underlined that “our strategic relations with China, India, Vietnam, Laos and Myanmar look indicative. We are getting a new impulse in our interaction with Brunei, Cambodia, Malaysia, Indonesia and the Philippines both on a bilateral basis and within multilateral ASEAN formats”. Addressing the Russian-Chinese notion of a confrontational Western course, he stressed that there would be no military solution to problems on the Korean peninsula, whereas any further instigation of the situation might lead to an armed conflict. [TASS]

Most notably, Gen. Wei Fenghe, China’s new defense minister, announced: “I am visiting Russia as a new defense minister of China to show the world a high level of development of our bilateral relations and the firm determination of our armed forces to strengthen strategic cooperation”. And, surprisingly direct: “The Chinese side has come (to Moscow) to show Americans the close ties between the armed forces of China and Russia … we’ve come to support you.” [CNN]

Also related to the British-Russian Skripal affair, a Chinese Foreign Ministry spokesperson called on the relevant countries to find out the truth in the Skripal case, discard their Cold War mentality and refrain from confrontation. [China Daily]

Indian Defense Minister Sitharaman observed more carefully that a key facet of the current international situation is the “continued and rising unpredictability” in relations between major powers, which was both “unprecedented and a matter of concern” with the “current deterioration of ties between Russia and the West” being “a reflection of this trend”. [The Wire]

Moreover, the foreign ministers of Russia and China jointly denounced what they described as protectionist US-unilateralism which is currently only adding to both countries´ growing rapport on global issues. Chinese Foreign Minister Wang Yi strongly criticized Washington’s move to hike tariffs on Chinese products and warned it would hurt the global economy and international trade Calling it as “typical unilateralism and an undisguised attempt at hegemony”, he requested that “the international community must jointly oppose such unilateralism and violation of rules.” Russian foreign minister Lavrov declared: “It has nothing to do with diplomacy. It’s an attempt to enforce its own interests while completely ignoring the interests of others”. [NY Daily News]

Another international platform for Russia to garner international support last week, was the Ankara summit gathering the leaders of Russia, Turkey and Iran. Presidents Putin, Erdogan and Rouhani  focused on the situation in Syria, where especially Iran and Turkey pursue the central goal to curb any Kurdish leverage in the border regions.

Positive for Moscow is not only the unity against American positions that includes a key NATO member state but also the fact that Russian S-400 missiles are on order to Turkey, a move of high symbolic importance notwithstanding the S-400´s actual military impact. [Forbes]

Concerning the Skripal case, it will be interesting over the coming weeks to observe how the quick, concerted and harsh diplomatic reaction of the countries having followed the UK suit against Russia will be received in broader leadership circles in Asia. For the Maldives, N. Sathiya Moorthy raises the question in how far the UK/US-led West’s “current engagement/disengagement with Russia”, might lead to a deflection of Western engagement to the disadvantage of the Maldivian opposition. According to him, parts of the joint opposition in the Maldives seem to be in doubt how the scenario might develop in terms of continued Western support for their cause. The implicit notion is that the Western show of diplomatic force in the Skripal case will effectively rather strengthen than weakening anti-Western voices in the local discourse, seen as bolstering the incumbent administration in the Maldives. [ORF Online]

Another Asian country involved in the affair albeit in a different, rather indirect way is Bangladesh as Sheikh Mohammed Belal, the country’s ambassador to Netherlands, is currently the chairman of the Organization for the Prohibition of Chemical Weapons (OPCW) executive council with the OPCW being in charge to verify the UK´s allegation that the poison is of Russian origin.

This has put Bangladesh for a short time in the focus of the major players. During an emergency meeting of the OPCW last Wednesday on Moscow’s bid for a joint investigation, Joel Reifman, the chargé d’affaires of the US Embassy in Dhaka, met Bangladesh´s Foreign Secretary Md Shahidul Haque to discuss the matter after Russia had handed over a note to Bangladesh on March 22 explaining its position on the incident. The UK had also informed Bangladesh in detail about the incident several days after it had taken place in its bid to build international support for retaliatory measures against Russia. The British High Commissioner to Dhaka, Alison Blake, met Bangladesh’s foreign secretary at least twice over the matter, on March 29 and again on April 2.

A bilateral meeting between the foreign ministers of Bangladesh and Russia in Moscow on Monday also discussed the OPCW investigation into the poisoning . [Dhaka Tribune]

Moreover, to take another angle, interesting is also how Pakistan and India have just responded to the Russian proposal for a joint probe into the Salisbury Attack at the OPCW. While India has abstained from voting, Pakistan has supported the Russian motion, indicating how the strategic relations have already changed in the region. [The Wire]

Philippines President Duterte: ‘If my plane explodes, ask the CIA’

(hg) President Duterte announced that he turned to China and Russia for firearms after US blocked his request for supply. Duterte has been seeking to acquire assault rifles to step up the fight against Islamists which the US refused amid concerns over human rights violations.

Russia ‘donated’ instead around 5,000 Kalashnikov rifles and around a million rounds of ammunition as well as 20 military trucks, China thousands of rifles and ammunition too. Yet, Duterte insists that there is no military alliance between the countries: ‘To this day, Russia and China have yet to even ask for a piece of paper or pencil.’ He is reported to have added in dramatic fashion, ‘If my plane explodes, ask the CIA’, a quote resounding rather vague allegations previously made at CIA´s address that nevertheless has been widely spread in the Southeast Asian press. [Daily Mail]

China: Threat of returning jihadist fighters increased

(dql) According to analyses of the China Institutes of Contemporary International Relations China is facing an increased threat from trained jihadists re-entering the country, with the number of such people intercepted by Chinese authorities in 2017 6 times as high as in 2016. Jihadists return to China via Russia or central Asia, and their options had been broadened Beijing’s has been intensifying ties with Central Asian countries in the frame of its One Belt, One Road Initiative. [South China Morning Post 1]

Meanwhile, local media outlet Pajhwok Afghan News reported that two Chinese militants were among seven killed in an operation by Afghan military forces in the country’s northeast on Friday last week.  The operation was part of a offensive conducted along Afghanistan’s 76 km border with China’s Xinjiang Uygur autonomous region which is home to about 10 million people, mostly Muslims. [Pajhwok Afghan News] [South China Morning Post 2]

Inter-Korean relations: Search for dialogue formats after Kim Jong-un accepts return to six-party talks

(dql) After Nikkei Asian Review on Thursday reported that Kim Jong-un told Xi Jinping during his visit to Beijing that he was ready to resume six-party talks to discuss denuclearization [Nikkei Asian Review], Seoul’s reaction to the news reflects cautiousness as it on Friday reaffirmed that negotiations on denuclearization should be discussed first among the two Koreas and the US during planned summits, before involving other nations. [The Korea Times]

The six-party talks involving the two Koreas, the US, China, Russia and Japan began in 2003. However, they failed in 2008, largely because the North refused to allow inspectors to verify that it had shut down its nuclear programs.

Vietnam: Russia or US?

(hg) The ongoing deterioration of Russian-American relations put stress on old Russian allies orienting now at the US to contain China. This applies in particular to India and Vietnam with India fostering also strategic ties with Iran.

As much as India and Vietnam seem to have taken a clear anti- China stance, as much is Russia a traditional defense partner and friend to them, – a status which will become increasingly difficult for all sides due to the increasing US-Russian tensions and the corresponding Russian-Chinese accord.

In the Vietnamese case, the link to Russia is the even closer, even if it seems to fall short of the facts to see US-Vietnamese relations as a delicate plant and relating more to the realm of “public relations rather than strategic dialogue”

Yet, that diminishes not the Russian factor as thoroughly described by Nate Fischler. When the US maintained a decades-long arms embargo until 2016, Russia provided weaponry unrestrained to the extent that 93% of Vietnam’s procured armaments from 2011-2015 were delivered by Russia with Vietnam being Russia’s third biggest arms market worldwide at current, trailing only India and China.

In terms of inter-operability and familiarity, Russian arms are still unbeatable for the foreseeable future from a Vietnamese perspective, while a switch to American systems would come with high costs and a complicated process of weapons integration. Despite recent visits and lobby efforts by US President Trump and more recent Defense Secretary Jim Mattis, there are no indications for a significant momentum for such a turn. Not long ago, the Vietnamese Deputy Defense Minister declared that thanks to Russia the Vietnamese Navy can now “fully master the technology and techniques of modern military shipbuilding”, a significant boost to its naval combat capabilities in the strategically important South China Sea. Since 2011, Vietnam has acquired a total of 129 missile systems, 36 aircraft and eight naval vessels from Russia. [Asia Times]

In February, Vietnam has received two Russian-built Gepard-class frigates joining two others that had been delivered in 2011 as part of a $350 million contract. [Newsweek]

Beside these vital links, however, Russia is an old friend, deer to not a few party cadre and older officers as well as a predictable ally that has no ideological demands such as the US.

While relations to Russia are valued with the top designation of a “comprehensive strategic partnership”, the US and Vietnam share only a “comprehensive partnership”, a term first employed after an upgrade in bilateral ties in 2013 which is used for links to 11 other countries as well.

However, Russia has on the other side also refrained from destabilizing the maritime region’s balance of power to the disadvantage of Vietnams adversary China by not offering relevant weaponry to Vietnam. [Asia Times]

Now, Russia has nevertheless agreed to a new military cooperation roadmap with Vietnam signed by Russian Defense Minister Sergei Shoigu and his Vietnamese counterpart General Ngo Xuan Lich in Moscow last Wednesday on the sidelines of the 7th Moscow Conference on International Security.

As part of the agreement, Russia will deploy a rescue boat from its Pacific fleet to Vietnam, which will take part in search and rescue operations, send a delegation to continue work on a draft deal on search and rescue operations for disabled submarines and both countries will conduct joint military training including 176 Vietnamese soldiers supposed to travel to Russia for instruction. [Newsweek]

What might serve as a restrainer in the increasingly complicated situation however, is the dedication of Vietnam’s defense and foreign policy to the “three no’s”: no military alliances, no foreign military bases on Vietnamese soil and no relationships directed specifically against third parties. [Asia Times]

Nepalese PM Oli in Delhi amid soured relations

(hg) Nepal’s Prime Minister KP Oli, together with a high-level delegation, went to India for a three-day state visit on his first visit abroad after assuming office for a second time after fighting an ultra-nationalist election campaign much focusing on Indian interference in Nepali politics. During Oli’s first term, India-Nepal ties had reached their lowest point when Delhi pressured for the interests of Indian-origin Madhesis in the context of crafting the current Nepali constitution, allegedly supporting a blockade to put pressure on Kathmandu which, however, created widespread suffering in Nepal and caused bitter anti-Indian sentiments. Nepal has joined China´s Belt and Road Initiative in the meanwhile and is expected to formalize a number of projects under the scheme in the coming months. [Daily O] [Kathmandu Post 1] [The Hindu] See for an exclusive interview with PM Oli on his India trip, bilateral relations and Nepali foreign policy [The Hindu].

For the legacy of the blockade of the Indian-Nepali border see [Nepali Times].

When Nepal promulgated its constitution in 2015 to mark lasting peace after years of civil war, India exerted pressure on Nepali leaders, who are mostly from the northern hills, to accommodate the demands of the plains, especially regarding the said Indian-origin Madhesis and to reverse the decision for a secular constitution. To comply with the Indian pressure from PM Modi’s Hindu nationalist Bharatiya Janata Party (BJP) and declare Nepal as a Hindu state or to refrain from declaring it as secular was regarded by the leftist Nepali counterparts as an automatic invitation to the monarchy to return as the king is considered in Hindu political theology a reincarnation of a god. When dissenting minority groups started to block cargo trucks from India, Delhi used its border forces and customs to further block goods traffic in a time when Nepal still suffered tremendously from the consequences of a disastrous earthquake that had ravaged the poor country only month before. When PM Oli approached China for critical fuel supplies, Beijing promptly reacted, neutralizing the effects of the blockade which began then to be slowly lifted after five months in February 2016 as Nepal agreed to a few minor changes in the constitution. The very next month PM Oli visited China to engage in a dense partnership whose heart piece was a transit agreement allowing Nepal access to Chinese sea ports. But the anti-Indian resentment goes way beyond the episode as well reflected by Nepali editor quoted by the SCMP: “India wants to micromanage Nepal. They have to control all government appointments, they have to know everything. Their ambassadors behave like viceroys. Aren’t we a sovereign nation?” [South China Morning Post]

Significantly, even the Nepali, traditionally pro-Indian opposition, expects PM Oli to be treated respectfully during his visit. [The Hindu]

Now, China accounts for nearly 60 per cent of foreign direct investment (FDI) with India being a distant second with US$36.63 million, followed by the US and Japan. [South China Morning Post]

According to recent news a Chinese company will finance a Nepal’s private sector-led Hydropower Project and comprehensively coordinate all design, procurement, construction and finance after another Chinese company has signed an agreement with Nepal’s People’s Energy Limited to develop another Hydropower Project. [Steel Guru]

Another Chinese financed energy project, a – currently only planned – dam project, the $2.5-billion Budhi Gandaki plant in central-western Nepal, has become a major issue in the Delhi – Kathmandu – Beijing relations with PM Modi expected to refuse to buy the energy produced if it would be realized. The project had been initiated by former Nepal Prime Minister and Maoist leader Pushpa Kamal Dahal, or ‘Prachanda’, but soon cancelled by his successor in office from the pro-Indian Nepali Congress, Sher Bahadur Deuba. [Kathmandu Post 2]

The current Indian – Nepali talks are held after Pakistan has surprisingly advanced to reach out to both the Maldives and Nepal after Pakistan´s Prime Minister Abbasi has just headed to Kathmandu for a two – day visit only three weeks after Oli has taking over as Prime Minister. Abbasi was the first high profile foreign visit to Nepal´s new leader reportedly discussing also the Chinese Belt and Roads Initiative which Pakistan prominently joins. [Asian Tribune]

Maldives shifting away from India – now towards Pakistan

(hg) The Maldives, traditionally part of the Indian backyard, are shifting away from what India would like to see as its sphere of great power influence, coming closer not only to China but now also to India´s arch enemy Pakistan.

For a long time, India was the island state´s big brother, sometimes helpful, sometimes dominating. Thirty-year ruling autocrat Gayoom, now one of the leaders of the joint opposition, has received crucial military support as a pro-Indian leader for instance  when he was threatened by an attempted coup d’état led by Maldivian separatists and assisted by PLOTE, a Tamil secessionist group from Sri Lanka.

When the Gayoom dictatorship came to an end with the 2008 elections, first democratically elected President Nasheed, representing the other wing of the Maldivian opposition, continued good relationships with India until he had to resign in 2012, while Chinese investment started already to flow in. Current President Yameen, a half-brother of Gayoom, turned then decisively to China since 2014. Since then, Yameen has helped China to continuously beef up its presence economically but also by allowing the Chinese navy to dock in the archipelago. The Indian – Chinese rivalry has strongly influenced the present domestic power struggle with former President Nasheed having called for a military intervention by India to protect his country to be sold out to China. [International Policy Digest]

China has warned, however, that it would resist any Indian military intervention which has been ruled out by Delhi, while the Indian relationships to the Yameen government even worsen.

At a time when bilateral relations “are clearly in a free fall”, the Maldivian government has asked Delhi now to take back one of two naval helicopters it had gifted to the Indian Ocean archipelago saying that Male wanted a Dornier maritime surveillance aircraft instead of the “Dhruv” Advanced Light Helicopter it has received. Male is said to be also considering asking India to remove the other Indian chopper too which operates in an atoll where China is said to be considering building a port. [The Times of India] Moreover, has declined an invitation by India to send a ministerial-level delegation to the Defence Expo, a biennial exhibition of weapons and military hardware, to be held in Chennai next week, after having declined India’s invitation to participate in the eight-day major naval exercise “Milan” from March 6-13 too. [Global Village Space]

Now, the surprising visit of the Pakistani army chief General Qamar Javed Bajwa is another step in the Maldives´ shift away from India. The most worrisome outcome for India are reported discussion about joint patrol by Maldivian and Pakistani naval forces in the vast exclusive economic zone (EEZ) of the island state, which is regarded as a ‘redline’ for India. So far, India has been the only country with whom the Maldives have conducted such joint patrols of its EEZ. Not too long ago, India and the Maldives have still been defense partners – even when China became already economically increasingly important already – leading to the conclusion of a significant MoU on defense cooperation in 2016. The latter formalized a process of setting up a coastal surveillance radar system for “real-time surveillance of the EEZ of Maldives”. Back then, India has supported the surveillance of the EEZ of the Maldives, Mauritius and the Seychelles unrivaled. [The Wire] A Pakistani – Maldivian joint patrol of the Maldivian EEZ would mark a major setback, seen as an intervention in the Indian backyard and a dangerous encircling of the sub-continent.

Another potential issue of Pakistani – Maldivian cooperation will be counter-terrorism with a team from the Maldives´ National Counter Terrorism Centre said to soon travel to Pakistan to further cooperation. In fact, Maldivian nationals received scholarships for religious study in Pakistan which seems to have contributed not only to their radicalization in general but also to the high number of Maldivians joining the Islamic State. [Firstpost]

Catholic Church in China: Uncertainties about bishop appointments

(dql) Only a day after state-run newspaper Global Times reported on a deal on bishop appointments in China between China and the Vatican to be possibly signed over Easter, citing the secretary-general of the Bishops Conference of the Catholic Church in China [Global Times], Vatican spokesman Greg Burke denied such an immiment agreement, confirming only that both sides are in constant communication.

The Vatican and China, where 12 million Catholics are split between followers of the state’s Catholic Patriotic Association, which operates independently of the Pope, and an underground community loyal to the Vatican, resumed negotiations three years ago. Ever since then, the issue of the appointment of the bishops has been the stumbling block preventing an agreement.

According to a source familiar with the matter, under the agreement in question the Vatican would be ready to recognize seven bishops chosen by the Chinese government. In return Beijing would accept the pope’s authority as head of the Catholic Church in China. Among those seven bishops are two who were excommunicated after being ordained without Vatican approval. [Catholic Herald] [South China Morning Post]

The deal, widely viewed as a the decisive step leading up to the eventual resumption of diplomatic relations between the Holy See and Beijing after a breach of almost seven decades, has raised concerns and critics among underground worshippers and critics of a rapprochement between the Vatican and China amid developments of tightened government control over religious affairs in the past years. Vocal Hong Kong-based Cardinal Joseph Zen Ze-kiun repeatedly warned against the agreement and denounced the Church of “selling out” the underground worshippers to China. [La Croix International]

The contradicting statements on the status of the deal come days after Chinese police had detained Vincent Guo Xijin, an underground bishop, for one day before releasing him on Wednesday. As part of preparations for the agreement, Guo was recently asked by the Vatican to make way for excommunicated, government recognised  Bishop Vincent Zhan Silu and to accept demotion to become an auxiliary bishop. [Catholic News Agency]

China: Specialized court for finance to be established

(dql) After a meeting on Wednesday, chaired by President Xi Jinping, the Communist Party’s Leading Group for Comprehensively Deepening Reforms made public its decision to set up a specialized court for finance in Shanghai, in an attempt to strengthen the finance-sector related judiciary. While details of the court remained undisclosed, it is expected that the new institution will play a role in punishing unscrupulous institutions and individuals for financial crimes and reinforcing Shanghai’s transformation into an international financial center. [South China Morning Post]

At the same day, Wu Xiaohui, former chairman of financial of Chinese giant conglomerate Anbang Insurance Group went on trial on Wednesday in one of China’s biggest financial crimes trials. Wu was charged with fundraising fraud and embezzlement, involving more than 10 billion USD, and pleaded guilty asking the court for leniency. [The Diplomat]

In a related development, Liu He, China’s newly elected vice-premier in charge of economic policies and financial issues, on Wednesday called on China’s regulators to make risk prevention in the country’s financial sector their top priority. [Reuters]

China’s anti-corruption campaign: ‘Godfather’ of Chinese coal mining town sentenced to death bribery

(dql) An Intermediate People’s Court on Wednesday sentenced Zhang Zhongsheng, former mayor of the city of Luliang in the poverty stricken, coal rich province of Shanxi, to death. The court found Zhang, dubbed ‘godfather’ due to his power and influence in Luliang, guilty of ‘extreme’ greed accepting bribes amounting to more than 160 million USD over a span of 16 years in return for help in obtaining project approvals and coal resources. [South China Morning Post] The sentencing, hailed by party aligned newspaper Global Times for signaling that the Party’s ‘long lasting, arduous and complicated, but ceaseless’ anti-corruption is ‘gathering unstoppable momentum’ [Global Times], comes a week after the National People’s Congress approved the Supervision Law granting anti-corruption enforcement bodies far-reaching investigative and prosecutorial powers including detaining and interrogation suspects for up to six months without charge and guaranteed access to lawyers. [Global Compliance News] [Xinhua for the text of the law in Chinese]. Amnesty International has criticized the law as a ‘systematic threat to human rights in China’ for creating ‘a parallel system solely run by the Chinese Communist Party with no outside checks and balances’. [Amnesty International]

‘Recalibrating’ Sino-Indian ties to which avail?

(hg) One of the interesting features of Indo – Chinese relations at the moment is the mutual stress of commonalities and convergence. [Hindustan Times]

With new American tariff policies and prospects of a trade war, Sino-Indian trade relations have become a subject of ‘convergence’ with both countries´ just having signed 101 trade agreements. [Xinhua] On this line, the Indian ambassador to Beijing has reiterated his positive stance with respect to trade potentials [Business World], while a Chinese Foreign Ministry spokesman underlined the “sound momentum” in bilateral relations [The Times of India 1] [Money Control].

Yet, at 16.13 per cent, India still brings the largest share of its exports to the US but only 3.42 per cent to China, making it the fourth-highest importer of Indian products. India is nevertheless looking to lower its widening trade deficit with China with the Indian government seemingly considering to grant China the status of ‘market economy’ for which China is struggling with the European Union (EU) and US in the World Trade Organization (WTO), a designation that would lead to dramatically lower anti-dumping duties on Chinese goods. [The Times of India 2]

Amid softening tones between the countries, Prime Minister Modi and President Xi seem to plan a meeting on occasion of the Shanghai Cooperation Organization’s summit in June this year. The Shanghai Cooperation Organisation (SCO), a China-dominated security grouping, is increasingly seen as a counterweight to NATO.  [Hiru News]

Improving trade relations and general announcements in direction of bilateral convergence between China and India might, however, be seen as the soft accompaniment to an entrenched military, economic, political and cultural competition that increasingly moves the region, rather than the dawn of a strategic U-turn.

Security relations remain as rough as the message behind all rhetoric where it comes to the contentious Dokhlam border issue regarding to which both countries continue to insist on their sovereignty. While announcing to work for a peaceful solution, the steady militarization of the border area continues unabated. [The Week] [Asia Times] [The Economic Times] [The Times of India 3]

Indian Grand Strategy

(hg) Interesting especially in the context of the above described Sino-Indian economic convergence are some recent assessments of the state and potentials of Indian grand strategy.

A Stratfor piece recapitulates the conditions, potentials and direction of India’s grand strategy from a more general perspective [Stratfor], while Ravi Kant reflects on the possibility of an Indian Marshall Plan to thwart China’s expanding sphere of influence [Asia Times]. To strengthen democracy and trade in the region such an Indian Marshall Plan “must include aggressive foreign and economic policies to promote regional integration through the trade and digital connectivity” with India supposed to take “a leadership role in Asia to prove that it is an emergent power with the ambition of a superpower”. [Asia Times]

An arguably more realistic assessment is skeptical even about and Indian great power status as a country would “lack serious extra regional power projection capabilities, does not decisively dominate its own region, and is not a system shaping power in either economic or military balance terms” [Modern Diplomacy].

Arguably, India finds itself in a strategic environment shaped by an unravelling Chinese encirclement and succeeding threats to its backyard – dominance while it positions itself in the ranks of those countries decisively aiming to equally encircle and contain the Chinese sphere of influence.

Despite recent efforts in achieving increasing self-reliance in developing critical missile technologies [India Today] [Financial Express 1] [Financial Express 2], India remains largely outgunned by China [The Economist].

Noteworthy, besides a recent Chinese sale of an advanced missile-tracking system to Pakistan that may enhance latter’s ability to develop multiple, independently targetable re-entry vehicle technology for its medium- to long-range missile systems [Jane’s 360], some observers see Russian-Indian relations fading with a Russian, China, Pakistan collusion. [Daily O]

Other observers highlighted that India is already so deeply entrenched in an anti-China alliance that it was not even make a major difference for this positioning if the Indian side would come to see the US as a less reliable partner under Trump then wished for initially. According to this view, the momentum of the American-Australian-Japanese-Indian Quadrilateral Security Dialogue would sustain even in its trilateral form in the case that the American-Indian partnership would face same backlashes. [Business Insider]

The American-Indian security partnership should in fact be seen as entrenched and settled as it is. The US offered India its most advanced defense equipment, training and intelligence cooperation, effectively choose it before Pakistan lauding India’s stance on ‘terrorism’, invest in India’s defense industries, engage in nuclear reactor sales, support India for a permanent seat on the UN Security Council, and give India a prominent role in Afghanistan. Moreover, the U.S. has also designated India as a ‘major defense partner’ a unique category created specifically for India to expedite defense technology transfer while the Pentagon has also created ‘India Rapid Reaction Cell’ streamline projects for co-development and co-production of hi-tech military equipment in India, being the only country to have such a specific cell inside the Pentagon. [Modern Diplomacy]

Being that were marriage of convenience, this partnership´s benefit for India is sufficiently tangible under the given circumstances to be acknowledged in its own sustaining weight for the country´s grand strategy.

Despite everything happening on the economic front, the US are indeed treating their new major security ally with great care visible again in context of the US’ expulsion of 60 Russian diplomats for the alleged Russian Salisbury attack, when the US assured that they were not intending at sending any message to a country like India having an equally strong relationship with both Moscow and Washington. [The Economic Times]

India-Uzbekistan relations: Connecting India, Central Asia, and the Gulf in deepening cooperation

(hg) India and Uzbekistan are further advancing bilateral ties after the Central Asian Power had already an important role in getting New Delhi into the 2016 Ashgabat agreement with effect from February 3, 2018, a multi-modal connectivity and infrastructure agreement between India, Uzbekistan, Kazakhstan, Turkmenistan, Iran, and Oman, for creating an international transport and transit corridor between India, Central Asia and the Persian Gulf. Other Indian projects that are somehow also linked to Uzbek interest or influence are India’s MoU with Oman on the Duqm Port, the Iranian Chabahar Port and the planned International North South Transportation Corridor (INSTC) via Iran’s Bandar Abbas Port. A further step for India would be to also access the Eurasian Economic Union. [The Economic Times 1]

As Central Asia’s biggest military power Uzbekistan has now offered India also to set up a defense manufacturing unit which would allow Delhi to make strategic inroads in the resource-rich region amid massive Chinese presence. [The Economic Times 2]

Uzbekistan has also invited India to increase the bilateral counter-terrorism partnership and to specifically join its deradicalization program with respect to the growing network of the Islamic State (IS) in Afghanistan, a country being strategically important for both countries. [The Economic Times 3]

The proposed visit by Uzbek President to India later this year will lead to the creation of a strategic partnership. [The Economic Times 2]

Indian-Chinese Navy encounter? Joint US-Indian exercise

(hg) India has categorically denied reports of Nikkei Asian Review that its warships were in direct confrontation with the Chinese Navy near the Maldives last month.

This is the second time the Indian Navy has denied reports of tensions with China in the Indian Ocean in context of the Maldives crisis. [The Print]

Meanwhile four US Navy ships sailed in formation with an Indian Navy frigate and conducted joint exercise and crew exchange in the Indian Ocean [The Times of India]

Seychelles: India´s military reach out barred again

(hg) India can still not use the small Assumption island of the Seychelles whose lease to India shall enable the operation of a naval base and air strip with Indian soldiers to be deployed on the island to “train Seychelles’ troops” as the qualification of an outright Indian military base seems to a be sensitive issue.

Much as the Maldives, the Seychelles’ have long fostered close security relations to India. During the 1980s, New Delhi helped to prevent several coups against the Seychelles government: twice in 1986 and one in 1981, when a group of white mercenaries attempted to overthrow the Island´s government. On basis of the 2003 ensuing MOU on defense cooperation, Indian naval ships were sent to patrol the country’s EEZ against Somali pirates in 2009. Since then, New Delhi has donated military equipment and eventually entered in the now muted agreement on the use of Assumption. The agreement was signed during Prime Minister Modi’s visit in 2015 but remained unratified by the Seychelles´ National Assembly as the government went into a minority in 2016. Meanwhile, after India has already built a network of six related coastal radar stations which are manned by Seychelles Coast Guard personnel, it has been revised this January to be tabled for ratification this month. Yet, now voting on ratification has been postponed till April again as the opposition signaled new resistance.

Besides, the ‘base question’, and some public sentiments against stronger Indian presence in general, the Seychelles and China are currently exploring new ways to expand their cooperation in defense and trade. [The Quint] [Firstpost]

China´s joint ocean observatory on Maldives contribution to strategically encircle India?

(hg) China is looking to build what the Maldives officially describes as a Joint Ocean Observation Station, which, however, would offer significant military potentials as well. Such an observatory would in fact be an important tool to gather information on ocean state, phenomena and processes yielding a variety of physical, chemical and biological data to better understand the specific characteristics of that part of the Indian Ocean and Arabian Sea providing the Chinese navy with the needed accurate and reliable hydrological data to support prolonged sub surface operations in the Arabian Sea. This is seen by Indian strategists as setting the condition to optimally deploy nuclear-powered attack and ballistic missile submarines in India’s maritime backyard and eventually as another move to complete India’s strategic encirclement by China. [The Economic Times]

Sri Lanka´s openness to China

(hg) Under former President Rajapaksa who is working for his comeback Sri Lanka was an early participant in China’s infrastructure-building project that eventually became the Belt and Road Initiative. That created a huge debt burden for the country which was finally forced to sell the Hambantota port to China Merchants Port Holdings after Rajapaksa was gone who swiftly criticized the move. Ironically, public anger over Chinese debt had helped the present Sirisena – Wickremesinghe administration rise to power over Rajapaksa three years ago. Despite pledging to reevaluate China-funded projects which they alleged were corrupt, the new government soon saw itself negotiating concessions to China as well while pushing ahead with the inherited projects. [Bloomberg]

Now, the government seems increasingly to put its hopes in even more Chinese investment albeit desperately seeking also for Indian and Japanese investment that just does not come enough or quick enough.

Last week, the Bank of China has opened a branch in Colombo in a high-profile event attended by the Prime Minister who announced Sri Lanka would now work with China on a Free Trade Agreement (FTA) that would complement the FTA Sri Lanka is discussing with India. He also expressed hope that the Bank of China, which is the world’s fourth biggest in terms of assets, would create an opportunity for his country to develop into a financial hub in Asia. [Colombo Gazette 1]

Against this background, the Chinese Ambassador to Sri Lanka has once more remembered of the fact that the China-Sri Lanka friendship dates back to ancient times and China attaches great importance to the bilateral relations. Reiterating the Chinese promise of harmonious coexistence he assured that China will never interfere in the internal affairs of Sri Lanka and never attach additional conditions to its assistance: “While pursuing building a new type of international relations featuring mutual respect, fairness and justice, win-win cooperation, China is actively working together with Sri Lanka to promote the latter’s economic and social development and bring benefit to the two peoples,”. [Colombo Gazette 2] 

Bangladesh-China relations

(hg) On occasion of Bangladesh´s Independence Day, Chinese President Xi Jinping said in a message to Bangladesh President Abdul Hamid, “I attach high importance to the development of China-Bangladesh relations,” reiterating the Chinese interest to deepen the cooperation between the two countries and push both´ “strategic partnership” to new heights. China and Bangladesh have elevated the bilateral relations to strategic level during Xi’s visit to Dhaka in Oct 2016, though the governing party still fosters good relations with India. [Dhaka Tribune] [BD News 24]

North Korea’s denuclearization: Diplomatic dynamics unfolding

(dql) Amid diplomatic dynamics unfolding in the wake of the inter-Korean summit on 27 April and the yet to be confirmed meeting between US President Trump and North Korean leader Kim Jong-un, the two-day visit of the latter this week in Beijing widened spaces for dialogue, at least according to China’s state-run outlet Xinhua as it quotes Kim saying that ‘the issue of denuclearization of the Korean Peninsula can be resolved, if South Korea and the United States respond to our efforts with goodwill, create an atmosphere of peace and stability while taking progressive and synchronous measures for the realization of peace.’ [Xinhua 1]

Kim Jong-un’s ‘unofficial’ visit at the invitation of Xi Jinping signals China’s efforts to regain an active role in shaping a potential resolution of North Korea’s denuclearization, based on a stable relationship between both countries. Asked at a press conference on Wednesday on the impacts Kim’s visit on Beijing’s stance towards the implementations of UN resolutions against North Korea, Foreign Ministry spokesman Lu Kang stressed the importance of a ‘friendly and cooperative relationship’ between Beijing and Pyongyang and reasserted ‘China’s relevant principled position and China’s will to continue with its constructive role’ to ‘strive for the denuclearization, peace and stability of the Peninsula’. [The Washington Post] [Ministry of Foreign Affairs China]

Meanwhile, Xi Jinping’s special representative and member of Communist Party Politburo Yang Jiechi held talks with South Korean President Moon Jae-in in Seoul on Friday. Both sides emphasized that the Korean Peninsula is at critical juncture, and mutually reassured the willingness to cooperate on achieving denuclearization, and maintaining peace and stability on the Korean Peninsula. [Reuters] [Xinhua 2]

In a related development, Japanese Prime Minister Shinzo Abe revealed on Monday that Tokyo and Pyongyang has been talking to each other the possibility of meeting with North Korean leader Kim Jong Un, while also touching also on prospects of opening a three-way dialogue involving Washington. [The Japan Times] Abe’s announcement follows Tokyo’s recent shift from a long maintained hardline stance towards negotiations with Pyongyang to the current more conciliatory position.

Sino-Japanese relations: Agreement on maritime security ‘hotline’ in final stages

(dql) Signaling an improvement in Sino-Japanese relations, Tokyo and Beijing are making final arrangements in an attempt to officially agree on starting the “maritime and air communication mechanism” at a bilateral meeting of the leaders of both countries scheduled to be held in Tokyo in early May. The mechanism is a new military communication channel aimed at preventing accidental clashes between defense forces and scheduled to begin operation in May. [The Japan News]

China: PLA troops downsized by 300 000

(dql) According to Col Ren Guoqiang, spokesman of the Ministry of Defence, China has successfully implemented Xi Jinping’s 2015 announced plan of downsizing China’s military by 300 000 troops. The People’s Liberation Army (PLA) is now a 2 million force, compared with 4.5 million in 1980, 3 million in 1985, and 2.3 million later on. Already in 2017, the PLA announced its plans to reduce the number of troops down to 1 million in the course of its rapidly advancing modernization and professionalization process.  [Business Standard] [Global Times]

Cross-Straits relations: Chinese military jets enter Taiwanese airspace

(dql) On Monday Chinese military aircraft conducted flight drills into Taiwanese airspace crossing through the Bashi Channel between Taiwan and the Philippines, prompting Taiwan’s airforce to scramble jets to shadow and observe the intruding aircraft. The move came just a week after China’s aircraft carrier Liaoning sailed through the Taiwan Strait towards the South China Sea. [Taiwan News]

Both moves further worsen the already strained relations between Beijing and Taipei. Amid these strained ties, two senior U.S. Republican senators have called on the Trump administration on Monday to permit the sale of Lockheed Martin Corp. F-35 fighter jets to Taiwan, the purchase of which the Tsai government reaffirmed earlier this month. [Reuters] [Newsweek]

Updates on South China Sea conflict

(ls/dql) In a move aimed to put Washington on notice, Beijing has put on a show of force in the South China Sea after satellite images showed China’s only operational aircraft carrier, the Liaoning, accompanied by dozens of other vessels in the South China Sea, conducting exercises at sea and in the air south of the Chinese island province of Hainan on Monday and Tuesday this week. Prior to this move, the Liaoning aircraft carrier, last week on March 21, sailed through the Taiwan Strait towards the South China Sea. [CNN] Meanwhile, Leslie Fong, in South China Morning Post, examines the Chinese standpoint against the background of the latest “Freedom of Navigation Operation” by the US Navy 12 miles off Mischief Reef, which China called a “serious military provocation”. According to China’s view, the US are playing up the fortification of islands as a prelude to Chinese intimidation of its neighbours, so that America can maintain or even increase its armed presence in waters not far from China’s 14,500km coastline. However, whereas China considers the South China Sea its “backyard” (comparable to the Gulf of Mexico for America), Fong argues that the US insist on freedom of navigation despite having themselves disregarded a rule-based order several times in the past. [South China Morning Post] Meanwhile, Secretary of National Defense of the Philippines, Delfin Lorenzana, said that the Philippines’ territorial dispute with Beijing over the South China Sea remains a security challenge despite an improvement in bilateral ties. The Philippines received three donated second-hand TC90 planes from Japan to boost the navy’s capability to gather intelligence in the disputed South China Sea. [The Straits Times]

Japan: Massive shake up of Grand Self Defense Force

(dql) On Tuesday, a maasive organizational shake-up of Japan’s Ground Self-Defense Force took place as its command was streamlined for flexible operations nationwide and amphibious forces in charge of defending remote islands were created. The launch of the Ground Component Command providing unified command over regional armies and the 2100-strong Amphibious Rapid Deployment Brigade, Japan’s version of the U.S. Marines, follows Japan’s efforts to strengthen its defenses against North Korea and China. [Kyodo News]

Japan’s first full-scale amphibious operations unit is drawn from the Japan Ground Self-Defense Force (JGSDF) Western Army’s infantry and includes an amphibious infantry regiment along with a landing unit will operate operating the AAV-7 amphibious assault vehicles currently used by the U.S. Marine Corps. Japan has ordered the vehicle for itself. The unit will also be transported by Bell-Boeing MV-22 Osprey tilt-rotor aircraft of the JGSDF and the amphibious ships of the Japan Maritime Self-Defense Force. [Defense News]

China’s post-Congress institutional reform: More party, less state

(dql) Immediately following the closing of the 13th National People’s Congress which further concentrated power in President Xi Jinping [East Asia Forum], the Central Committee of the Chinese Communist Party released measures of a large-scale reshaping of China’s institutional governance structure revealing a concentration of decision-making power in the hands of the party at the expense of the state. [Central Committee of the Communist Party, in Chinese]

One party organ which used to be powerful and – after a short period of being downgraded – now has regained and expanded its powers in the frame of this institutional overhaul is the Central Commission for Politics and Legal Affairs. It absorbs three coordination groups in charge of the maintenance of law and order, social stability and the Falun Gong crackdown. The Central Commission for Politics and Legal Affairs, established in 1958, a had been a power powerful organ before it was downgraded for a short period of time following the sacking of its former head Zhou Yongkang (2007-2012) over corruption charges, including bribery, abuse of power and leaking state secrets in 2012. The regaining of and increase in power of the commission which is responsible to the Central Committee headed by Xi Jinping reflects Xi’s push for domestic security and order.The commission is responsible for coordinating inter-agency work on upholding law and order, consolidating information and intelligence related to domestic security, coordinating the handling of major incidents, analyzing and preventing social stability risks, and formulating an anti-cult policy. The police force, prosecutor’s offices and courts are to report to the commission. [South China Morning Post]

Another party organ reporting to the party’s Central Committee is the United Front Work Department.  Under the new reform measures it is given oversight over the State Ethnic Affairs Commission and absorbs the State Administration of Religious Affairs and the Office for Overseas Chinese Affairs. Created during the civil war and reestablished in the late 1970s under Deng Xiaoping, the main function of the United Front Work Department so far has been the reach out to non-party key individuals and groups with social, economic and academic influence inside and outside China. [Reuters] The institutional changes increases the power and jurisdiction of the Department which Xi Jinping views as “magic weapon” in China’s soft power arsenal. [The Economic Times] The department is feared outside China for its work to widen China’s influence by means of soft power, particularly in regard to Chinese students studying abroad and the Chinese diaspora. Against this background US legislators introduced to the US Congress a bill which requires Confucius Institutes to register as foreign agents in an move strengthen foreign funding disclosure requirements for colleges and universities. [Business Insider]

Furthermore, the State Administration of Press, Publication, Film, Radio, and Television, China’s comprehensive media regulator, will be abolished and its functions distributed among two bodies. While the State Administration of Radio and Television, overseeing radio and television, is still to be created, film, press, and publishing will come under control of the Party’s publicity department. [The Sixth Tone]

India and China: Competition over influence in South Asia

(ls) India and China remain tight competitors over influence in South Asian countries. While India is making inroads by providing development aid, China, in turn has adopted a more capitalist approach and has made significant investments in the region. The Times of India compares Indian and Chinese development aid and investments in numbers and geographical distribution, concluding that China has started to wield considerable military power and economic leverage to reorder the region. [The Times of India] Meanwhile, China has sold Pakistan a powerful tracking system in an unprecedented deal that could speed up the Pakistani military’s development of multi-warhead missiles. China is the first country to export such sensitive equipment to Pakistan. It has been a long-held notion that Beijing is supporting Islamabad’s missile development program, but solid evidence can seldom be found in the public domain, making the official confirmation of the deal on the Chinese Academy of Sciences (CAS) website a rarity. [South China Morning Post 1] However, the Indian ambassador to China, in a more reconciling tone, said that there were silver linings in Sino-Indian after a “challenging” 2017. Though the dispute over territorial limits in the Doklam region and the China-Pakistan Economic Corridor (CPEC) remain the top sources of friction between India and Beijing, the Indian ambassador said, “if the ‘boundary question’ as India calls it could be resolved, I don’t see other difficulties between India and China.” [South China Morning Post 2]

China-US relations: Tensions over trade and Taiwan increase

(dql) The trade dispute between China and the USA tightens in a tit-for-tat development. Reacting on President Trump’s signing on Thursday of an executive memorandum targeting Chinese imports to the USA with tariffs up to 60 billion USD [CNBC], China’s Ministry of Commerce announced plans to increase tariffs of close to 3 billion USD on US goods. [Xinhua] Prior to the Ministry’s announcement, the Chinese embassy in Washington expressed strong objection against Trump’s protectionist measure and vowed, in case of a trade war, to “fight to the end to defend its own legitimate interests with all necessary measures” [Chinese Embassy Washington] Two developments this week further complicate the situation. First, just a day after Trump’s signing of the executive memorandum the guided-missile destroyer USS Mustin carried out a freedom of navigation operation in which it came within 12 nautical miles of an artificial island built by China in the Spratly Island chain in the South China Sea. China’s Defense Ministry strongly objected the move arguing that it “harmed Chinese sovereignty and security, violated basic rules of international relations, and harmed regional peace and stability.” [Asia Times] Second, two senior US government officials visited Taiwan this week after the Taiwan Travel Bill, which encourages visits between U.S. and Taiwanese officials, was signed into law by President Trump last week. After Deputy Assistant Secretary of State Alex Wong on Tuesday, Deputy Assistant Secretary of Commerce for Manufacturing Ian Steff arrived in Taipei on Thursday. [South China Morning Post] The implementation of the Taiwan Travel Act triggered fierce reactions in state-run media in China. Global Times’ editorial demanded from Beijing to “strike back against strike back against Washington’s implementation of the Taiwan Travel Act” and demanded that the “mainland must also prepare itself for a direct military clash in the Taiwan Straits”, making clear “that escalation of US-Taiwan official exchanges will bring serious consequences to Taiwan.” [Global Times] Prior to these statement, Xi Jinping warned in his closing speech at the National People’s Congress that “all actions and tricks to split our country are doomed to fail and will face the condemnation of the people and history’s punishment.” [National People’s Congress China, in Chinese] Meanwhile, Taiwan’s Defense Ministry confirmed that China’s  sole operational aircraft carrier of the People’s Liberation Army Navy (PLAN) Liaoning entered Taiwan’s air defense identification zone (ADIZ) on Wednesday. [The Diplomat]

China’s reach to Europe

(dql) On Thursday China’s State Councillor Wang Yi hosted a meeting with vice foreign ministers from the four Visegrad countries – Slovakia, Hungary, Czech Republic and Poland – at which he expressed that China views the Visegrad alliance as the most dynamic force within the European Union and is ready to further develop the 16+1 cooperation. [Reuters] Wang’s statement comes at a time when the European Union is facing challenges to its unity in the wake China’s increasing investments and influence in Europe, especially among the smaller member states in Eastern and Southern Europe which are eager to align with Beijing to lure investments. [Politico] Meanwhile, Ireland’s Foreign Minister Simon Coveney stated in an interview during his China visit this week that Ireland is ready to step into the post-Brexit gap and to replace Britain as China’s new “trusted friend” in promoting the One Belt, One Road Initiative. [South China Morning Post]

China: Advancing military capabilities with AI

(dql) Considered by defence experts as China’s latest progress in the field of  unmanned technology as part of the modernization of its armed forces, a state-run newspaper Global Times reported on Wednesday about tests of driver-less tanks which could be equipped with artificial intelligence. China’s state television presented images this week of a Type 59 tank being driven by remote control, in what was the first time a Chinese-made unmanned tank has been shown in a public forum, according to Global Times. [The Telegraph]

Japan, South Korea and China agree upon trilateral summit

(dql) South Korea, Japan and China have agreed to hold a three-way summit in May and discuss ways to strengthen economic, environmental and cultural cooperation. Chaired by Japan and attended by Japanese Prime Minister Shinzo Abe, South Korean President Moon Jae In and Chinese Premier Li Keqiang, the summit is planned for 8-9 May, the same month proposed for meeting of US President Donald Trump and North Korean leader Kim Jong-un. [The Straits Times]

Brunei: PRC writing checks and advancing its interests

(jk) The Sultanate of Brunei sits on finite reserves of oil and gas which have long guaranteed the countries well-being. Prices for oil have been low however and resources become scarcer making Brunei feel the squeeze and realising its over-reliance on the energy sector. Despite HSBC and others banks closing down their business in Brunei recently [The Scoop], the Bank of China (BOC) has opened up shop there in 2016 with an eye on facilitating foreign direct investment from China. Brunei has a neglectable domestic market and with dwindling resources has become less attractive to HSBC and other international actors. Clearly, China is happy to fill the void and engage in more “check book diplomacy”, which Brunei undoubtedly is happy about. For China, Brunei is a strategically important country in its OBOR project, as well as a claimant in the South China Sea which the PRC would like to convince to engage in joint-development programmes to its on liking. Surely, writing checks will make the Sultan more agreeable [Asia Times].

Dragon Gold: Cambodia – PRC joint military exercise

(jk) After the first instalment in 2016, the 2nd joint military drill between the Royal Cambodian Armed Forces (RCAF) and the  Chinese People’s Liberation Army (PLA), “Golden Dragon 2018”, begun this week in Cambodia. The two-week military exercise is being conducted under the theme “Counter-Terrorism and Humanitarian Works”.

Whilst Cambodia continues to deepen its relationship with China, US joint military drills have been postponed indefinitely last year, claiming it was too busy holding elections (!) [Reuters].

Offering Niceties? Chinese Signals to India and annual Sino – Indian military exercise resuming

(hg) One more time, Chinese officials have send out reconciliatory signals to India, albeit on a lower level, when the Chinese Consul in Kolkata called for greater interactions between China and India on the cultural front, referring to both countries’ thousands of years old ties. [The Economic Times]

Similar approaches have been made on several occasions. They seem, however, not to be taken for signs of a changing trend in terms of grand strategy but rather as bids in an attempt to buy time.

Meanwhile, after an interruption to the country´s border clashes last year, the annual India-China military exercise will resume with Indian Army Chief GenBipin Rawat saying the sour relationships last year were now improving. [The Times of India]

China: Overseas Uighurs protest against Beijing’s Xinjiang securitization

(dql) Uighur Muslim ethnic group members this week protested in New York and Sydney against the Chinese government’s surveillance and security campaign in Xinjiang region accusing Beijing of detaining thousands of their people for political indoctrination in the course of the campaign. [ABC News] [Asahi Shimbun/AP]

Meanwhile, Xinjiang region deputy party secretary Zhu Hailun stated at the Xinjiang delegation meeting during the National People’s Congress that authorities were prepared and determined to sustain their efforts to ensure stability and development in the region and to continue a “persistent, complicated, sharp and at times very intense” crackdown on Uighur separatism. [Global Times]

End of China’s family planning policies in sight

(dql) In the frame of the submission of proposals for a large-scale institutional overhaul of ministries and state agencies [South China Morning Post] to the National People’s Congress the State Council this week brought forward the plan to establish a new National Health Commission in charge of national health policies, including population and family planning policies. The new agency would absorb the Family Planning Commission which has been feared across the country for its rigid enforcement the notorious if recently abolished one-child policy introduced in 1979. While the government has not yet abolished all family planning policy, analysts view the integration of the Family Planning Commission into the National Health Commission as a sign that the institutional reform will pave way for a policy reform at the end of which the all family planning policies will eventually be dropped. [Quartz]

China: Bill on new anti-corruption supervision commission submitted for legislature’s approval

(dql) On Tuesday, a bill detailing function and powers of the National Supervision Commission (NSC), China’s newly created top anti-corruption watchdog agency, went through the third reading in the ongoing National People’s Congress. The submission of the bill on Monday followed the approval of the constitutional amendments in the frame of which the NSC was listed as state organ. [Xinhua]

According to the bill, the NSC, formed out of the merger of the Central Commission for Discipline Inspection and various supervision and corruption control departments, would be vested with formidable powers, including conducting searches, seizing property and freezing assets as well as detaining suspects for up to six months as part of corruption investigations. The NSC’s oversight would be extended to not only cover about 90 million party members, but also public sector employees, including managers of state-owned enterprises, hospitals, educational and cultural institutions, sports organizations and even village governments and research institutes. Corresponding to the power of the NSC, the bill ranks it higher than the Supreme People’s Court and Supreme Prosecutors Office. [South China Morning Post]

Wang Shenming, Vice-chair of the Judicial Affairs Committees of parliament, announced that changes to the criminal procedure will be made upon approval of the bill. Critics of the bill voiced concerns over these changes as the bill failed to spell out aspects pertaining to improving requirements for evidence and protecting suspects rights, such as access to a lawyer during investigations. [Reuters]

The bill whose vote in scheduled for Monday 20 March reflects the continued determination of the government to further advance the sweeping anti-corruption campaign which President Xi Jinping has made a signature of his rule since assuming power in 2012.

China: Removal of two-term limit of presidency approved

(dql) China’s legislature on Sunday approved a constitutional revision scrapping the two-term limit of the office of the president. With only two of the 2964 delegates voting against the change, three abstentions and one spoiled vote the approval was nearly unanimous. This change, together with Xi Jinping’s other posts of the Secretary-General of the Communist Party and Head of the Central Military Commission which carry no explicit term limits, raise concerns of critics that a return to absolute rule, as experienced under Mao Zedong, is not distant. [Nikkei Asian Review]

These concerns are reinforced by other amendments of the constitution the parliamentary body also approved along the removal of the two-term limit. They include among others the incorporation of the clause ‘Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era’ as guiding policy principle, the addition of a sentence identifying the Communist Party as the ‘defining feature of socialism with Chinese characteristics’, as well as the designation of the supervisory commissions as state organ at the top of whose the newly established National Supervision Commission stands (see below). [The Jamestown Foundation: China Brief]

Japan: Strengthening bilateral security cooperation against China

(dql/thn) During his six-day visit to Japan, Sri Lankan President Maithripala Sirisena met Prime Minister Abe on Wednesday. The two leaders agreed on promoting bilateral cooperation on maritime security in the Indo-Pacific region and advancing bilateral defense exchanges, with Japan pledging to provide assistance in capacity building for maritime law enforcement to Sri Lanka. Abe and Sirisena also agreed on cooperation in upgrading the Indian Ocean country’s infrastructure, such as port facilities in Colombo, to boost connectivity in the region.

The agreements signals Japan’s efforts to bolster its “free and open Indo-Pacific strategy” in which Sri Lanka is viewed central in the wake of China’s growing maritime presence in Indian Ocean as the country is located near major sea lanes. [The Mainichi]

At the same time, Japan is strengthening its military and diplomatic presence in Southeast Asia by sending an extra defence attaché to its embassy in Kuala Lumpur. Japan has already sent two military officers to embassies in the Philippines and Vietnam last year. The appointment in Kuala Lumpur was confirmed by a spokesman for the ministry. However, he declined to explain Japan’s act. The appointments are being seen as another move by Tokyo to counter Bejing’s military  assertiveness. This concern is shared by some governments in Southeast Asia. [South China Morning Post]

China: Advancing military capabilities and technology

(dql) China Central Television broadcasted a report according to which over 10,000 troops traveled more than 2,000 kilometers to arrive on Monday at army training bases in Southwest China’s Province of Yunnan and East China’s Province of Shandong and begin battle training. In the reportedly largest ever trans-regional exercise of the People’s Liberation Army (PLA) Navy Marine Corps combined diverse modes of transport including air, water, railway and motor. The process of multi-dimensional delivery of troops and long-distance arrival was accompanied by battle exercises. [Global Times]

Meanwhile, the Chinese military released footage of People’s Liberation Army Air Force (PLAAF) drills with jets flying low over snow-capped mountains in western China. The head of PLAAF Western Theater Command commented in the video, that the exercises conducted did to not only target dummy rivals, but also serve to acquire useful and effective combat skills. For analysts the pictures point to country’s increased military presence near the border with India, and indicate that some technical hurdles to become a more effective mountain combat force has been overcome. [South China Morning Post]

In a related development, the Stockholm International Peace Research Institute has ranked China the world’s fifth largest arms exporter with sales from 2013  to 2017 accounting for 5.7% of all exports (compared to 4.6% for 2008-2012). The exports increased by 38% compared to 2008-2012. Among 48 client countries the main are Pakistan (35% of all sales), Bangladesh (19% of all sales), and Algeria (10% of all sales).

Among the top four countries are the USA (34% of all exports), Russia (22% of exports), France (6.7% of all exports) and Germany (5.8% of all exports). [Stockholm International Peace Research Institute]

Will the U.S. and China challenged as hegemons in Southeast Asia?

(hg) The U.S. and China are still the two big extra-regional players in South East Asia. Yet, some Southeast Asian states seem now “seeking to diversify their strategic partnerships, beyond a binary choice between Beijing and Washington” according to the Council on Foreign Relations. At the same time, a greater interest especially in India and Australia is observed by CNBC, which, regarding India, is coming especially from the side of Vietnam, Singapore and Indonesia. [CNBC] A perceived American lack of predictability and growing protectionism on the one hand and an increasing Chinese assertiveness notwithstanding, the undeniable advancing interest of some ASEAN members in fostering ties with countries such as India or Australia has, however, other causes as well. Arguably, it should especially not distract from the fact that the U.S. and China are still and will remain the undeniable heavyweights setting the pace of geopolitical positioning. Both countries enjoy a presence in Southeast Asia against which those of other powers is still paling, especially in case of the U.S. but increasingly also for China. Moreover, in a shifting geopolitical environment, amidst a fraying normative order of the international arena, almost all Asian nations engage in more active, differentiated diplomatic outreach in an attempt to gain a better position in the current power game, which, at the same time, is defined by the U.S. – Chinese competition at heart, while leaving a lot of space to secure a favorable position for single states as well. Singapore is outreaching in this sense to Sri Lanka as Japan does, while India and Vietnam are seeking ways to entrench their common interest into viable policies. In the last instance, most of such dynamics are integrated though in the current emergence of new spheres of influences centered at and defined by the Sino – American competition.

China-US relations to worsen over Trump signing Taiwan Travel Bill

(dql) In move worsening relations between Washington and Beijing already strained over trade issues, President Donald Trump on Friday signed the Taiwan Travel Bill which encourages visits between U.S. and Taiwanese officials at all levels. [Reuters]

The Chinese Embassy in Washington voiced ‘strong dissatisfaction and firm opposition’ as the bill contains clauses which seriously violates the One-China principle as the basis of China-US relations and the three joint communiques between China and the U.S. [Xinhua] [Chinese Embassy Washington, in Chinese]

Meanwhile Taiwanese President Tsai Ing-wen and other government officials expressed gratitude. [Taiwan News]

India: Debating defense spending

(hg) Heated debates over India’s defense spending reflect the domestic uncertainties India experiences while facing the emergence of a changing foreign policy paradigm especially regarding Sino-Indian relations.

India’s Army chief, General Bipin Rawat, has recently even praised his main adversary China recommending to take it as a model to increase military expenditure while providing an enabling environment for economic growth. [Daily O]

The remark represents expressive criticism that India would not invest enough in its armed forces, prompting some observers to draw interesting parallels.

Prakash Katoch, a retired Lieut. Gen. from the Indian Army’s special forces, as interestingly pointed at the moment when General Charles de Gaulle became the French president in 1959, a moment when France was militarily weak and the De Gaulle, who came to power in a context shaped by the Algerian war and coup-like actions against the government, ensured that the French defense budget remained greater than 2% of GDP, sometimes touching 5%. This, so the Indian general, resulted in France emerging as a militarily strong power with a current military expenditure of 6.2% of its GDP, while India need only a sustained defense allocation of 3-5% of GDP for the present and coming years, in addition to allocations catering for inflation and associated expenditures. [Asia Times]

Others point in the opposite direction, highlighting numbers provided by the highly reputed Stockholm International Peace Research Institute (SIPRI) according to which India was the largest importer of major arms in the past five years, single-handedly buying 12 per cent of the global total with an increase of arms imports of 24 per cent in the past five years compared with previous five years, while Pakistan’s arms imports have decreased by 36 per cent. Moreover, India has been the largest arms purchaser in the world not only for the past five years, but also from the beginning of this century having bought arms worth $46.8 billion compared with China’s $35 billion. The major beneficiaries of the increased arms import, in the meanwhile, American manufactures with India´s arms imports from the US having increased more than five times over the past five years. [Daily O]

Beyond sheer spending, there are also other factors that have to be taken in account when it comes to military efficiency. There has be enough new blood entering the military service (see the report below but there is also massive across-the-board corruption and nearly 30% of the indigenous defense equipment is substandard and has artificially inflated costs. [Asia Times]

Is India losing ground in Iran?

(hg) After India, Iran and Afghanistan have signed a trilateral agreement to jointly develop the Iranian Chabahar port in 2016 the first phase of the project having been launched for some months ago, Iran has now surprisingly invited China and Pakistan to also participate in the project. [The Times of India 1]

The move comes just after India and Iran have signed nine pacts, including the lease of Chabahar port, near the mouth of the Gulf of Oman. The project was meant to give India access to Afghanistan where India is strongly engaged but also link it better to energy-rich Central Asia as Pakistan does not allow overland access. [Nikkei Asian Review]

Although being completely at odds with the Indian strategic calculus that is driven by the Indian – Pakistani and Indian – Chinese rivalry, India has commented the move moderately, saying it would be the prerogative of the government of the Islamic Republic of Iran to choose its partners for the development of infrastructure facilities. [The Times of India 1]

Indian – Iranian relations are basically positive, reflecting both sides´ specific strategic opportunities but have also encountered certain backlashes and not developed in greater depth, with especially the Iranian-Indian energy ties having been relegated to second place after a stalemate over an Iranian natural gas field that India had hoped to develop without much success it began moving away from the project last year and decreasing its oil imports from Iran. [Al Monitor]

The recent Iranian openness for investments of India´s main adversaries in the project of significant symbolic and strategic value for India means thus something.

On the one hand, India’s positive relations with Iran might be one of the potential stumbling blocks for the currently deepening U.S. – Indian relations.

Moreover, very practical, India had to pay dearly for unilateral U.S. sanctions Iranian oil exports from 2012 to 2014, which also contributed to a more diversified Indian energy policy. [Al Monitor]

It might be speculated, that recent U.S. pressure on the Iranian leadership increased the pressure to look for natural allies regarding the ongoing conflicts with Saudi Arabia, Israel, and the US.

Notably, at the same time, influential US Pacific Command Commander Admiral Harry Harris reiterates once more that India is the “biggest strategic opportunity” for the US with both democracies being natural partners on a range of political, economic, and security issues. For Indian – Israeli defense ties see below. [The Times of India 2]

On the other side, China is cementing its position as Iran’s top trade partner with the bilateral non-oil trade having grown around 18% compared with last year as to February [Financial Tribune] and is advancing also as the major infrastructure project partner. China has just recently announced its interest in building a railway link between Armenia and Iran, which would provide for the shortest transportation route from the Black Sea to the Persian Gulf and establish a major commodities transit corridor between Europe and the Persian Gulf. [Arka] Last week it also signed a US$700 million deal with Tehran to build a train line connecting the Iranian port of Bushehr, Iran’s second biggest port after Bandar Abbas, to the rest of the country’s railway network, linking especially the Gulf port and the southern city of Shiraz to complete the “North-South Railway Corridor” in line with Iran’s goal of becoming a transport hub for goods between the Gulf, the Indian subcontinent, Russia and Central Asia. [The Straits Times] Moreover, Iran Air has now signed an agreement with an unnamed Chinese company over the funding of its badly needed plane purchase campaign from Airbus and Boeing. [Press TV] Against this background, Iranian First Vice-President Es’hagh Jahangiri has just ordered the Iranian foreign ministry to draft the plan for expanding bilateral trade and economy ties between Iran and China. [Mehr News]

If China, Iran and Turkey are really forming a new axis as former White House chief strategist and ousted executive chairman at the alt-right Breitbart News Steve Bannon claimed some weeks ago or not [Ahval News], China does offer an increasingly important partnership to Iran which, under the current conditions, might appear more promising to Tehran than those with India, if tough decisions are about to make.

Nepal’s orientation away from India

(hg) With the newly elected President Bhandari from the left alliance, the country is in firm leftist hands. Soon it will elect also a vice-president and last Sunday, Nepal’s recently elected Prime Minister K P Oli has gained a remarkable vote of confidence with a two-thirds majority in Parliament (208 votes out of 268). [Asia Times]

Against this background, the old hegemon India is rapidly losing ground in Nepal, which is increasingly opening up to China. Unclear is only how much space India will lose, China will gain and what the impact is these developments on the regional order will have.

A breaking point for the special relations between India and Nepal was the 2015-16 blockade of the Indian-Nepali border after Nepal had promulgated a new constitution to the Indian displeasure. The new Socialist government of Prime Minister Oli in Kathmandu would only gain from serving the ensuing bitterness and the recent visit of Pakistan’s Prime Minister – the first foreign head of government to visit Nepal after Oli assumed office – only adds to Nepal’s increasing openness to China. Indian attempts to better relations to Nepal were too insignificant and came too late as Biswas Baral points out in The Diplomat. [The Diplomat] [Asia Times]

Oli’s willingness to cooperate with both China and Pakistan poses a serious strategic challenge to Delhi while another friend, Iran, seems to also opening to India’s adversaries.

Maldives crisis: Pressure, appeasement and an international turning point?

(hg) Against the background of the ongoing political crisis in the Maldives, the parliament of European Union has passed a resolution to call on the Maldives government to “respect and fully support the right to protest, freedom of expression including access to social media), association and assembly, and freedom of conscience and freedom of religion and belief, irrespective of the majority religion,” as well as to “ensure that the Human Rights Commission of the Maldives, the National Integrity Commission and the electoral commissions can operate independently and without government interference”. [Avas 1] The Maldives’ Fatwa Majlis, the national religious advisory body has now dismissed the resolution as a threat of the Islamic faith of the archipelago. [Avas 2]

Earlier, the EU, in addition to some of its member states such as Germany and the United Kingdom, had also raised concerns over the crisis, having called on Maldivian institutions to “lift immediately the state of emergency and restore all constitutionally guaranteed rights” and warned that if the current situation failed to improve, targeted measures might be considered. As the EU is the Maldives’ largest export partner and the EU member states strongly contribute to the Maldives’ tourism industry, the pressure is significant. [The Diplomat]

Interestingly, the Maldivian government earlier last week has send out surprising signal of appeasement to India stating: “We have an India first policy and we believe that India is the big brother in the region, not China.” The statement was made by the Minister of Fisheries and Agriculture in the presence of other senior Maldivian ministers, including the Ministers of Economic development, the Minister of Legal Affairs, and the Minister of Tourism at the President’s office on occasion of the first international press conference hosted by the island nation this year. The minister also declared that “no matter what anybody says or suggests”, the Maldives will not be militarized by China. [18 News]  

Given the entrenched alliance between the government and China this is a surprising move that is not much reported yet. If it comes too late and how it has been coordinated remains unclear yet.

Protest against China’s Tibet policy: Self-Immolation of Tibetan man

(dql) According to Radio Free Asia and monitoring organizations, a Tibetan on Wednesday set himself on fire to protest against Beijing’s repressive policy towards Tibet. The self-immolation comes just a few days of the 59th anniversary of the March 10 Tibetan uprising in 1959, a rebellion against China’s effective rule and control of Tibet established in 1951. [Radio Free Asia]

China: Expanding anti-corruption campaign

(dql) Reflecting the Chinese government’s policy to continue its anti-corruption campaign with unabated determination and force, China’s Minister of Supervision announced that the National Supervisory Agency, China’s new anti-corruption super-body, will increase threefold the number of targets of existing watchdogs. The statement comes while a bill has been submitted for approval at this and next’s plenary sessions of National People’s Congress according to which the National Supervisory Agency command commissions at provincial, city and county levels allowed to investigate, question, search, detain and take disciplinary action against not just party cadres suspected of corruption but all public sector employees. The bill also ranks the agency higher than the courts and the procuratorates within the hierarchy of China’s state organs. [South China Morning Post]

Since assuming power in 2012, Xi Jinping has made the fight against corruption a signature of his rule. Overseen by the Central Commission for Disciplinary Inspection (CCDI), under the anti-corruption campaign more than 1.5 million officials have been disciplined, among them 35 members of the party Central Committee and nine members of the CCDI itself. [Brookings]

China: World’s second largest defense budget set to be approved

(dql) On Monday, the 1st plenary session of 13th National People’s Congress began in the wake of the Communist Party’s Central Committee publication of its proposal to revise the constitution and remove the two-terms limit of the presidency.

In his opening work report on the past five years Premier Li Keqiang outlined China’s defense and national security policy in the years ahead. He announced that China will continue to massively build up its military in order to achieve the goal of a world-class military by mid of the century set by Xi Jinping and advance “all aspects of military training and war preparedness, and firmly and resolvedly safeguard national sovereignty, security and development interests”. [South China Morning Post]

For 2018, a defense budget has been submitted to the currently meeting legislature for approval which sees an increase of 8.1% compared to last year’s budget to amount to 175 billion USD in total. [Xinhua]

This defense spending makes China’s defense budget the world’s second-largest after the US (716 billion USD) and raises concerns among China’s neighbors about the impact of such defense spending on the military balance in the region. They worry about China’s increasing military might which may lead to even more assertive moves in the region. [The Diplomat]

China-US relations: Tensions on the rise over looming trade war and Africa

(dql) Signs are pointing to rising tensions in Sino-US relations in the wake of a looming trade war between the countries. Following two failed missions to Washington to de-escalate the stand-off in US-China trade by State Councillor Yang Jiechi and President Xi Jinping’s most trusted economic adviser Liu He last month [South China Morning Post], President Trump geared up his protectionist policy and signed on Thursday an order for a 25% tariff on imports of steel, and a 10% tariff on aluminium, triggering worldwide concerns over trade wars. [The Guardian]

Reacting on the order and recent tweets of the US President on trade wars, China’s foreign minister Wang Yi said at a press conference at the sidelines of the National People’s Congress on Thursday that China is ready for “a justified and necessary response” in any trade war. [CNBC]

Meanwhile, ahead of his Africa trip US secretary of State Rex Tillerson voiced harsh criticism against China’s model of economic development in Africa, accusing China of encouraging dependency and denying governments long-term democratic growth. Tillerson said China used corruption and predatory loan practices to undermine African governments and mire them in debt. [Quartz]

Marine Gen. Thomas Waldhauser, U.S. military commander overseeing troops in Africa, in a hearing of the Congress warned on Tuesday against ‘significant’ consequences should China take a key port in Djibouti. If China, he explained, placed restrictions on the port’s use, it could affect resupplying the U.S. base in Djibouti and the ability of Navy ships to refuel there. China has already built a military base in Djibouti, just miles from a critical U.S. military base.

Waldhauser’s warning follows Djibouti’s recent termination of its contract with DP World from Dubai, one of the world’s biggest port operators, to run the Doraleh Container Terminal and suspicion that Djibouti seized control of the port to give it to China as a gift. [Reuters]

North Korea: Trump to meet Kim in May and international reactions

(dql) In a stunning development after months of fierce tensions between Washington and Pyongyang over the latter’s nuclear missile tests, the White House on Thursday that President Donald Trump agreed to meet North Korean Kim Jong-un face to face in May. Trump will be the first US President to meet a North Korean leader in person. [Express]

South Korean President on Friday hailed the impending meeting as a ‘historic milestone’ for peace on the Korean Peninsula and ‘opportunity that came like a miracle’. [Yonhap] However, during a meeting with party leaders on Wednesday, Moon confirmed that he has no plan to ease sanctions against Pyongyang for the sake of his summit with North Korean leader Kim Jong-un scheduled for late next month. [The Korea Herald]

Less euphoric, Prime Minister Abe warned to be cautious towards the meeting in May as it could be a ploy on Pyongyang’s side to buy time and demanded concrete steps toward denuclearization to defuse Tokyo’s scepticism. Unless these concrete steps are taken by Kim-Jong-un, Tokyo would continue with using maximum international pressure to denuclearize North Korea. [The Japan Times]

Meanwhile Chinese official and government-backed media outlets report on China welcoming the news on direct talks between the US and North Korea as a chance for a return to peace and stability [Xinhua], but also on China’s readiness to ‘help protect the rights of North Korea when Pyongyang begins denuclearization talks with Washington’ and ‘prevent North Korea from being deceived or squeezed by the US once it begins to denuclearize.’ [Global Times]

Russian Foreign Minister Sergey Lavrov considers the agreement a ‘step in the right direction’ towards a dialogue based on mutual respect’. [TASS]

Japan: Navy to buy tanker to fuel ships patrolling East China Sea

(dql) Japan’s navy plans the purchase of its first oil tanker to carry fuel to Okinawa as it is beefing up operations in the East China Sea to counter a growing Chinese naval presence, according to sources familiar with plan. The procurement plan comes at a time when operations in the East China Sea, where Japan and China are locked in a territorial dispute over the ownership of a group of islands claimed as the Senkaku in Tokyo and Diaoyu in Beijing, are increasing and intensifying in the wake of China’s military growing strength in this region. [Reuters]

The Maldives: In the middle of Indo-Chinese powerplay – and accused of selling oil to North Korea

(ls) A Chinese naval combat force that entered the Indian Ocean for the first time in four years may have helped deter an Indian intervention in the Maldives after its pro-China president imposed a state of emergency. India, a traditional ally, had received calls from Maldives’ opposition leaders last month to use force against President Abdulla Yameen to restore democracy. After the state of emergency was declared, India -moved aircraft and ships to its southern bases and put special forces on standby, two military sources in New Delhi said. In the end, however, no military action was taken. [Channel News Asia]

Meanwhile, in an interview with DW, former Maldives President Mohamed Nasheed accused incumbent President Yameen of suppressing political opponents – and supporting the North Korean regime. A ship under the Maldives’ flag allegedly sold oil to North Korea ignoring United Nations sanctions on the country. According to Nasheed, the ship was also funded by the Bank of Maldives. Earlier, Japan’s foreign ministry already announced that a Maldives ship was transferring oil to North Korea refines on high seas. [Deutsche Welle]

South China Sea

(jk/ls) The South China Sea remains one of the main flashpoints in Asia, continuing to involve littoral, regional as well as extra-territorial actors. The situation on the ground is changing mainly for two reasons. On the one hand, extensive land reclamation and military build-up of islands and other features in the SCS by the PRC have created new facts on the ground and essentially present the world with a fait-accompli on behalf of China. On the other hand, unsuccessful policies and growing uncertainties regarding the commitment of the US and a significant policy change in what used to be the most forward-leaning claimant state other than China, the Philippines, have led to political circumstances facilitating Chinese actions. For an update on the island-building and reclamation activities of all five claimants, please refer to the Asia Maritime Transparency Initiative out of the Center for Strategic Studies who have overhauled their Island Tracker. It now includes imagery of every outpost in the South China Sea which amounts to over 90 facilities at nearly 70 features [Asia Maritime Transparency Initiative].

In more recent developments, the second iteration of the Bilateral Consultative Mechanism (BCM) on the South China Sea between China and the Philippines has made some headlines. The bilateral meeting – the preferred cooperation modus by China who opposes any extra-territorial nations to be involved- is in a way an outcome of the Philippine’s softening stance on the SCS dispute since 2016, although the idea of joint development projects – which the meetings discussed – has been around much longer and their success is questionable. Major ‘breakthroughs” that are announced more often than not fail to extend beyond very low hanging fruits and carefully worded statements that do not change facts on the ground or go beyond what has already been achieved in an ASEAN wide context [ISEAS, The Diplomat 1].

Another relevant development is this week’s US aircraft carrier port call to Vietnam – a first since the end of the Vietnam War over 40 years ago. Since the Philippines has changed its stance on the SCS, Vietnam has taken over as the claimant that is seen to challenge China most, with the US intensifying ties to it [The New York Times].

The response by Beijing to the port call- although critical, was not overly aggressive with the People’s Daily acknowledging the fact the Hanoi engages in a hedging strategy and that it long has done so. It did find however that the US move was all but a “waste of money” [Asia Times].

In a related development India and Vietnam have, in a high-level joint statement, once again affirmed their support for freedom of navigation in the South China Sea, where Vietnam is a claimant along with five other states — China, the Philippines, Brunei, Malaysia, and Taiwan. Hanoi has been particularly pro-active in the dispute in recent years. In addition to approaching India, Vietnam has grown closer to the United States as well. [The Diplomat 2]

In the meantime, the UK has announced that it will send a Royal Navy vessel to conduct a “Freedom of Navigation” voyage in the SCS [The Times UK].

China: Relatives of US journalists detained

(ldq) Four ethnic Uighur journalists working with Radio Free Asia in Washington D.C. have reported their relatives disappeared or detained. The move is seen by them as retaliation of their coverage on the Muslim-majority Xinjiang region considered by the Chinese government as a hotbed of separatist forces. To suppress them the government has been driving a securitization push of unprecedented scope in the recent years. [Time Magazine] [AiR 4/2/2018]

Military-civil integration in China: Strengthening cyber power capabilities within a corporate state model

(ldq) China’s government is increasingly incorporating civil society and the private sector to strengthen its military cyber power capabilities, reflected in the recent establishment of the Cybersecurity Innovation Center. The center, working under the Central Commission for Integrated Military and Civilian Development and run by the of the ‘360 Enterprise Security Group’, one of China’s prime cyber-security companies, is tasked to “set up a cutting-edge cyber-security defense system for the military to help win future cyber wars” and to reach out to small- and medium-sized companies for cooperation on technology research and development projects in order to guarantee the supply of cyber defense services which meet practical combat requirements. [People’s Daily]

Against this background, China’s cyber militias with an estimated membership of 10 mio. people engaged in cyber espionage represents a modern manifestation of Mao Zedong’s People’s War doctrine. The challenge for the government lies in the question of centralizing and organizing this force to secure that it consistently serves the country’s defense and military aims. [The Diplomat]

China: Indefinite rule of Xi Jinping?

(ldq) The Central Committee of the Chinese Communist Party has published 21 proposals for constitutional revisions [National People’s Congress, in Chinese] set to be approved by the first plenary sessions of the 13th National People’s Congress (NPC) which will begin off on Monday. The politically most far-reaching among them is the proposal to remove a clause of Art. 79 restricting the number of terms of president and vice-president to two. This revision, along with the likewise expected insertion of the clause ‘Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era’ in the preamble of the constitution, would pave the way for an indefinite presidency of Xi Jinping and for a further consolidation of his power and his position as most powerful leader since Mao. [South China Morning Post 1]

Likewise, the expected election of former anti-corruption chief and member of the Politburo Standing Committee Wang Qishan as one of the four vice presidents [Asia Channel News] and of top economic advisor Liu He as vice premier and governor of People’s Bank of China [Reuters] reflects Xi’s efforts to underpin his position by placing trusted and loyal aides at the top echelon of the state apparatus.

Critics view the constitutional proposals as a back fall to ‘ancient traditions of the Mandate of Heaven’ and ‘seed for chaos’ in the country and point to risk posed to the system’s stability by scrapping a system of institutionalized, regular and ordered power transition introduced in the constitution in 1982 in the wake of the experiences of the Cultural Revolution and its personality cult of Mao therein. [South China Morning Post 2] [China Policy Institute: Analysis] [Brookings]

China: Military build up

(dql) Reflecting China’s ongoing efforts to advance its military in line with President Xi Jinping’s vow for a world-class military by mid of the century, a major state-run newspaper reports that China possesses the technical ability to build larger aircraft carriers. The news comes ahead of the release of the country’s annual defence budget at the National People’s Congress. [Reuters]

In a related movement, China’s main supplier of warships announced that China might have a nuclear-powered aircraft carrier in the water by 2025 to strengthen its maritime defences and to catch up with the USA and France as countries with nuclear-powered carriers. China’s two existing aircraft carriers use conventional oil power.  [South China Morning Post]

China-US relations: Tensions rising over trade and Taiwan Travel Act

(dql) Sino-US relations are worsening in the light of President Trump’s uncompromising stance on imposing tariffs on Chinese imports. Backed by muscular tweets on ‘good and easy to win’ trade wars, Trumps announced his decision to impose tariffs of 25% for foreign-made steel and 10% for aluminum. The President’s announcement comes just when Liu He, China’s top economic advisor, is in the US to hold talks with US government officials and business leaders on Sino-US trade issues. [Forbes]

Meanwhile, following the House of Representatives’ passage of the Taiwan Travel bill in January, the US Senate on Wednesday also approved the bill which encourages high-level visit exchange between the United States and Taiwan. [Reuters]

Beijing voiced strong dissatisfaction against the move arguing that the bill violates the One-China principle and lodged solemn representations. [Xinhua]

Cross-Strait relations: Call for independence referendum launched 

(ldq) Backed by former presidents Lee Teng-hui and Chen Shui-bian, a campaign to call a referendum on Taiwan’s independence on April 6, 2019, was launched on Wednesday, 28 February by Formosa TV Channel chairman Kuo Bei-hong. At the related press conference the government was called on to reform the National Referendum Act to cover issues of independence as subject of referendums. The date of the launching marks the 71st anniversary of the so called ‘228’ incident, an anti-government uprising in Taiwan violently suppressed by the Kuomintang-led Republic of China government with estimated 10,000 deaths. The date has been playing a crucial role in forming the Taiwan independence movement. [Focus Taiwan]

Meanwhile, Beijing on the same day announced measures aimed to provide Taiwanese companies and individuals freer access to opportunities and benefits on the Chinese mainland. Among other things, the new measures will allow Taiwanese companies operating on the mainland to partake in the “Made in China 2025” program – the central government’s blueprint for upgrading the country’s manufacturing sector – as well as bid for infrastructure projects, and claim various tax incentives. Taipei-based Mainland Affairs Council denounced Beijing’s move as attempt to buy political support. [South China Morning Post]

China-Philippine relations: Energy deals solely commercial, not government-to-government agreement

(dql) Against the background of an agreement between the Philippines and China last month to establish a special panel to work out joint exploration oil and gas in part of the South China Sea that both sides lay claim without having to address the touchy issue of sovereignty, Harry Roque, spokesman of President Rodrigo Duterte, Thursday announced that any potential deals between Manila and Beijing on energy exploration in the South China Sea should be agreed with a company and not the Chinese government. This announcement is the latest sign of warming ties between the Philippines and China under Duterte who, in exchange for trade opportunities and financing in key infrastructure projects, has put aside territorial disputes with Beijing. [South China Morning Post]

Sino-Japanese relations: Signs of a thaw?

(dql) Indicating a thaw after years of strained relations between Japan and China, Tokyo announced on Friday plans to invite Chinese Premier Li Keqiang for a formal visit which would coincide with a trilateral summit with South Korea in May. The visit of Li is considered a preliminary move to get President Xi Jinping’s for state visit to Japan. Li’s visit would the first visit of a Chinese leader to Japan in eight years. [The Japan Times 1]

Meanwhile, Japanese media outlets report on Tokyo’s consideration of a plan to deploy new anti-ship missiles to the main island in Okinawa as a response to China’s growing intrusions in the Miyako Strait in the past years. While none of these actions constitute a violation international law, they have drawn the ire in Japan. At the same time, the Miyako Strait is a key bottleneck for China’s largest ambitions of dominating the so-called first island chain making it a key node for any Japanese defense strategy. [The National Interest]

In a related development, Japan’s Defense Ministry is studying the feasibility of deploying F-35B fighter jets on Maritime Self-Defense Force helicopter carriers, Defense Minister Itsunori Onodera stated on Friday. This move is widely viewed as another sign that Japan is retreating from its strictly defense-oriented military posture. [The Japan Times 2]

A shadow over Sino-Pakistani relations?

(hg) China´s strategically highly important investment in Pakistan’s Gwadar port which this is about to start transshipment on March 7 is threatened to be hampered by security threats. To secure Beijing’s funding of S$65.8 billion in infrastructure projects, Pakistan has even raised a special 15,000-strong security force.

Balochistan where Gwadar is located is one of the less secure parts of the country with more than 2600 people have been killed by terrorists since 2003, mostly off limits to outsiders and now crowded by Chinese whose security deteriorated recently. After Beijing’s Embassy issued a warning of imminent terror attacks on Chinese targets December 2017, a Chinese manager at Cosco Shipping Lines has been gunned down just recently in an upmarket area of Karachi.

Moreover, Gwador points at one of the important weak points of the Chinese OROB plan. On the one side, heavy Chinese investment is expected to have turnout for the local population in terms of jobs, access and finally general material benefits. If this is not manifesting as other nodal points of Beijing’s mega expansion project local population gets disappointed. If it lives also anyway in a difficult relation with its own government and on the tight security conditions, the investment climate can easily deteriorate with all well-known consequences. On the other side, although the heavy Chinese investments might be levered on the basis of the long-term calculation, there has to be some return as well, economic and symbolic. If the local population feels to get nothing, if Chinese citizens are threatened and returns on investments fail to materialize, both governmental partners are inclined to face difficult relationships. Currently, the situation is still not being close to that level. Yet, the possibility looms and is further increasing the costs of investment on both sides. [The Straits Times]

A related, likewise sensitive issue for Pakistan is Islamabad´s international perception of not doing enough against domestic terrorism and the Chinese role in this discourse.

As reported earlier in AiR, the Financial Action Task Force (FATF), a global money-laundering watchdog, will place Pakistan on its terrorist financing watchlist — the so-called grey list — after China withdrew its initial support for Pakistan to not be listed.

This unexpected change on the Chinese side might be explained by what Beijing might perceive as Islamabad’s inaction against terror groups operating also against Chinese targets, especially in Baluchistan. [The Diplomat]

This move contributes to the currently slightly improving vibes in Sino-Indian relations whereas a sustaining impact on the latter might be doubted.

Noteworthy in this context, the U.S. military has expressed to see “very positive indicators” from Pakistan showing it is becoming more responsive to U.S. concerns about militant safehavens expecting Islamabad to go on to make a “strategic shift”. [US News]

Signs of bettering China-India relations and prospects of the emerging Asian security order

(hg) Given that the rivalry between Asia´s great powers India and China has reached a structurally manifest stage, there have been recent signs of slightly improving relations as well. A Chinese call to “deepen strategic communication, beef up mutually beneficial cooperation and properly settle sensitive issues” has been well received with the Indian Embassy in Beijing saying the two sides “noted the need to build on the convergences […] and address differences on the basis of mutual respect and sensitivity to each other’s concerns, interests and aspirations”, highlighting further that a “sound development of relations” would be “a factor of stability in the world today.” [The Diplomat]

Yet, the decisive question is, in how far current signs of bilateral improvement support expectations of a trend and, if so, how deep and pervasive such a trend might become. A significant change of the emerging regional order with India´s integration in the `quad` would represent a major strategic shift with vast consequences. Currently, softening stances between the countries might rather point at a mutual desire to restrain the established trend for the meanwhile rather than to replace it, at least from the Indian perspective.

Interesting in this context is an analysis of the Brookings Institution regarding the Indo-Pacific region as the primary locus of global growth and opportunity today while its security and stability are seen increasingly under duress. Putting the blame for this on China, shared interests of India and the U.S. as the world’s two largest democracies with two of the largest military forces are seen having propelled India-US security ties dramatically forward over the past decade which is reflected by the rapidly advancing defense ties.

Relations, however, are still not evolving in a mature and cohesive strategic frame as long as the US is seen as seeking focusing on tangible short-term returns on its investment while India is about to make long-term decisions of potentially existential impact and thereby interested in reliable, long-term assurances that “will be neither fickle nor overbearing” [Brookings]

Another recent piece puts also strong emphasize on the fundamental competition between China and India with its strong expansive dynamics across the Indian ocean and beyond from Tanzania to Sri Lanka, Oman to Iran, the Maldives to the Seychelles and Bangladesh to Nepal. [CNBC]

Nepal: In between Indo–Sino competition 

(hg) A recent South China Morning Post article highlights once more the intensifying Nepali–Chinese relations to the disadvantage of India. [South China Morning Post]

Interesting news are reported from Pakistan whose Prime Minister seems to plan a two-day official visit in Nepal to congratulate Nepal´s new Prime Minister KP Sharma Oli, news which have – surprisingly – explicitly not been confirmed by Nepal´s Foreign Ministry. [Pakistan Observer]

New Chinese naval observation station in the Maldives: A dual use facility?

(hg) Against the backdrop of mounting international pressure regarding the Maldives constitutional crisis, China has reiterated that a joint Maldives–Chinese ocean observation construction has been agreed upon between the governments in December last year and is located close to Indian Kerala and Sri Lankan coast has no military applications. [The Economic Times]

China: Economic portfolios to be under new rising star

(dql) Liu He, Xi Jinping’s trusted chief economic advisor to the Chinese government since 2013 and member of the Politburo of the CCP elected at the Party Congress in October 2017, is likely to be promoted to become one of four vice premiers at the upcoming National People’s Congress. According to analysts, Liu will rise to one of the country’s most powerful vice-premiers in two decades, reigning over China’s economic management. Continuing to head the Office of the Central Leading Group on Financial and Economic Affairs he will probably also become chairman of the Financial Stability and Development Commission, a new financial regulatory agency under the State Council established in November 2017 and superseding all financial regulators [South China Morning Post], and is also tipped to become the next governor of the People’s Bank of China. [Reuters]

Meanwhile, Liu, a graduate of Harvard University’s Kennedy School, is scheduled to meet President Trump’s trade envoy Robert Lighthizer in Washington next for talk on trade disputes at a time where US-China trade relations are at critical juncture. [The Wall Street Journal]

China: Worrying numbers of arrests in campaign against organized crime since launch in January

(dql) One month after the launch of the nationwide campaign against organized crime in January, first results have been delivered. According to CCP’s People’s Daily, at least six provinces have submitted reports revealing more than 1000 arrests and more than 9000 suspects rounded up across the country. Analysts called the campaign worrisome in the light of the high numbers and prosecution quotas set by some provinces. [South China Morning Post]

Meanwhile, in Transparency International’s 2017 Corruption Perceptions Index (CPI), released on Wednesday, China is ranked 77 among 180 countries with a low CPI score 41 out of 100 ( with 100 being “very clean” and 0 “very corrupt”), moving up two places since 2016 when China was ranked 79 with a score of 40. [Transparency International]

China: Securitization in Xinjang and Tibet on the way to perfection?

(dql) The un-abating determination with which the Chinese government continues to push for security in Tibet and Xinjiang, massive staffing of police force and extensive use of state-of-the-art surveillance technology indicate that China is about to perfect securitization in both regions. Chen Quanguo, a Henan soldier-turned-politician who was Party Secretary in Tibet from 2011-2016 before assuming the same post in Xinjiang in 2016, plays a key role in implementing Beijing’s securitization efforts, writes Adrian Zenz. [China Policy Institute: Analysis]

China-US relations: Beijing angered over US sanction package against North Korea 

(dql) China voiced it dissatisfaction about a new package of US sanctions against North Korea Washington announced on Friday. The sanctions target among others Chinese shipping and energy firms by blocking assets the firms and individuals hold in the United States and stopping U.S. citizens from dealing with them. Beijing sternly denounced the unilateral targeting of Chinese firms and people and warned against risking to harm cooperation on Pyongyang. [Channel News Asia]

The sanctions come at the time when both countries’ relations are strained by trade disputes. In a latest statement, David Malpass, U.S. Treasury’s top diplomat, accused Beijing of “patently non-market behavior” and demanded stronger counter-responses from the US. [CNBC]

China-India relations: Indian Foreign Minister’s visit to Beijing amidst strained bilateral ties

(jk/dql) India’s Foreign Minister Vijay Gokhale visited this week Beijing to hold across-the-board talks with top Chinese officials on advancing ties between India and China amidst rising New Delhi’s concerns over Beijing’s assertive foreign policy in the Indian Ocean. His visit is also viewed as part of preparations for talks between Prime Minister Narendra Modi and President Xi Jinping scheduled to meet at the Shanghai Cooperation Organisation (SCO) June summit. The Foreign Minister met Politbureau member and State Councilor Yang Jiechi, China’s top foreign policy official, as well as Foreign Minister Wang Yi. [The Hindu]

Meanwhile, PM Modi, who has stated that India is the net security provider in the Indian Ocean Region (IOR) and therefore responsible for order and security there, has reacted to an increased activity of Chinese PLA Navy ships [India Today 1]. Eight warships have been deployed around the entry points to the Indian Ocean Region, in order to keep an eye on adversarial powers (read: China) [India Today 2].

A number of news outlets have also circulated that the PLA Navy has deployed a significant amount of ships (11) to the IOR and close to Maldivian waters to deter India from interfering in the constitutional crisis on the island. However, all quote the same source, the Chinese news portal sina.com.cn, and so far, this report was not confirmed. In fact, the Indian Ministry of Defence has denied it and the PLA Navy has not commented. Fake news? [Financial Express]

For a more detailed strategic explainer of the IOR, see [Brookings].

On the other side,  the People’s Liberation Army’s newspaper Global Times refers to a senior military specialist according to whom the Chinese military is advancing its military airspace defense of Western Theater Command to confront any threat from India. The People’s Liberation Army (PLA) released photographs of a J-10 jet and J-11 fighter jets conducting aerial combat training exercises in Western China last week. They belong to an aviation brigade of the air force under the PLA Western Theater Command, responsible for mountain warfare at the border area with India. [Global Times]

Indonesia unlikely to join US-led coalition to contain China

(hg) In late January, U.S. Secretary of Defense James Mattis visited Indonesia to begin the implementation of the new U.S. National Defense Strategy, which calls for forging a “networked security architecture” in Asia/Indo-Pacific to prepare for the “great power competition” with China. Observer as Joshua Kurlantzick and Mark J. Valencia note the U.S. seems to win Indonesia as a key partner in this endeavor, an assumption they assess unlikely to happen.

True is, Indonesia has serious issues China where it comes to the Natuna islands area in the South China Sea and potentials of increasing domestic Chinese influence in a country that has always fostered strong anti-Chinese sentiments.

This would on the other side hardly be enough that there will be a long-term alignment of national security interests between the countries.

First, Indonesia has been one of the driving forces of the nonaligned movement since the Bandung conference 1955. Just recently when President Jokowi has visited Pakistan, both countries´ nonaligned status has been an important issue in mutual assurances of friendship. Secondly, there is the growing Islamization and the perception of the U.S. as a deeply biased friend of Israel, a prescription which has been prepared by the recognition of Jerusalem As Israel’s capital. Then, third, there is a difficult history of relations between the U.S. and Indonesia, starting with American role in the 1965 military countercoup against the communist coup attempt leading to a mass slaughter which is still a taboo that nevertheless comes with subtle skepticism against America and its supportive role in the course of events for many Indonesians. The other side, the American suspension of military cooperation with Indonesia’s elite unit Kopassus because of its human rights violations have widely been regarded as hypocritical.

Key ministers with military background in Pres. Jokowi´s cabinet have proven their profound skepticism towards the US engagement in the region. Defense Minister Gen. (ret.) Ryamizard Ryacudu has suggested that “if regional countries can manage the South China Sea on their own, there is no need to involve others” while Gen. (ret.) Luhut Panjaitan, the coordinating minister for political, legal and security affairs, has said that, “We don’t want to see any power projection in this area.” In sum, no Indonesian governments seems currently to be in the position to sell the close rapprochement with the U.S. to the countries´ elites or the bulk of voters. [The Diplomat]

The mere fact that the Trump administration is downplaying democracy and human rights as core components of U.S. foreign policy currently, might help with other countries in the region but does not really help to improve relations with Indonesia as long it is inclined to be received against the background of an alleged anti-Islamic U.S. foreign policy.

The best American strategy seems to stabilize a more transactional relationship which, as Kurlantzick notes, would suit the leadership style of the presidents of both countries. Such a transactional relationship could focus on strategic ties regarding three major security threats: China’s growing assertiveness in the South China Sea, the rise of Islamic extremism in the region, and, the ongoing issue of piracy in Southeast Asian waters. In terms of economic strategy toward Southeast Asia the U.S. have to recognize furthermore that Indonesia is the largest economy in the region, its only G20 economy, and the biggest untapped market for U.S. firms in Southeast Asia. Regarding economic relations there are also the obstacles for revamped relations as both countries have a tendency to focus on economic nationalism. [Council of Foreign Relations 1] [Council of Foreign Relations 2]

The ensuing risks for bilateral relations have already manifested as Indonesia is the latest Asian country to face American trade curbs after the U.S. Department of Commerce said it planned to slap anti-dumping duties of 92.52% to 276.65% on biodiesel imports from the country, a decision Indonesia will challenge before the WTO dispute settlement panel. [Nikkei Asian Review]

Just recently, the European Community Shipowners’ Association, ECSA, has described the new Indonesian legislation aiming at reserving cargoes as protectionist and worrying to give a current example for Indonesian protectionism. [Shipping Watch]

China: Lunar New Year break education ban a sign of curbs against Hui Muslims?

(dql) Education officials from the local government in Guanghe county in the northwestern province of Gansu, a heavily-Muslim area, banned children from attending religious education during the Lunar New Year break which lasts for several weeks around the week-long public holiday period that started on Thursday. It is unclear if the ban, similar to those used by the authorities in the Uighur communities, will continue after the holiday, but it appears to conform to new national regulations that took effect on Feb. 1 aiming to increase oversight over religion. Observing recent developments in Xinjiang and Tibet, Muslims of this area fear further interference in religious education and affairs of their community. [Reuters]

China’s military rise

(hg) ‘The Military Balance’, an annual assessment of global military capabilities and defense economics which has just been released by the UK-based International Institute for Strategic Studies, concludes for some observers surprisingly that in U.S. – Sino competition Beijing’s reach is global, while America’s remains parochial. According to the state-of-the-art assessment, China´s progress in fielding near-peer competition in avionic and naval capabilities has outpaced growth in every Western nation-state, from ultra-long-range conventional missiles to fifth-generation fighter jets. While China still needs to develop and implement suitable tactics to operate its advanced weapon systems and to synchronizes them with its existing doctrinal arsenal, the stark conclusion is that it will be able to deter US dominance in the Western Pacific. Reportedly China also seeks to deploy an ambitious arms-export strategy securing regional allies throughout the globe with advanced technologies.

Meanwhile, the Chinese efforts to modernize its army pale in comparison with its achievements in avionics and naval procurements while China still spends more on domestic repression of its interior than all of its defense spending combined highlighting the internal vulnerability of the reigning Han which offers strategic potential to Washington argues William Holland for the [Asia Times].

A list of noticeable military innovations that experts view as challenge to US military dominance is provided in this article [NBC News].

China-Russia relations: Warming up amid Beijing’s artic ambitions

(dql) Late January the Chinese government released its first-ever Arctic Polar White Paper revealing China’s plans for a ‘Polar Silk Road’ to access to Europe through the Arctic Ocean. According to Nicolas Groffman, the strategic common ground for China and Russia in the context of Beijing’s arctic ambitions is the Baltic states the absorption of whose by the NATO caused great resentment in Russia. The political deal would be that Moscow backs Beijing in its arctic policies, Beijing in return might be perfectly content to give the nod to more activism and assertiveness for Russia in this area, [South China Morning Post] latest reflected in the deployment of a permanent nuclear-capable missile system in Kaliningrad two weeks ago, just on the day of the first anniversary of the arrival of a Nato battle group in Lithuania. [Financial Times]

China-US relations: Uncertainties amid great-power war rhetoric and trade standoff

(dql) Testifying before the House Armed Services Committee, Admiral Harry Harris, outgoing commander of the US Pacific Command in Hawaii and President Trump’s nominee for the post of Ambassador to Australia, on Wednesday warned against China’s “crystal clear” intention to dominate the South China Sea and to undermine the rules-based international order in the Asia-Pacific, manifest in Beijing’s construction of military bases on seven disputed islands in the South China Sea which are claimed by other countries. The 4-star Admiral voiced the need to prepare for a possible war with China whose military would soon be able to compete with American power. [The Guardian]

Awaiting Senate’s confirmation, Harris’ nomination sends strong signals of the US commitment to bolster US-Australian security ties and to advance the Free and Open Indo-Pacific Strategy to Beijing. At the same time, it poses a tricky challenge to Australia to strike a balance between its security alliance with the US and economic relations with China. [Sputnik News]

Meanwhile, US-China trade relations continue to heat up. In a latest development, Beijing announced on Monday that tariffs of 5%-10.7% would be applied to imports of styrene from South Korea, Taiwan and the US effective from February 13. It also announced further anti-dumping investigations on US imports. This move follows Washington’s increase of tariffs on imported washing machines and solar panels which hit China and South Korea the hardest. Analysts fear an escalation of punitive trade actions among both countries. [The Economic Times]

Chinese protest over Modi´s visit of disputed border area

(hg) China protest over a low-key visit by Indian Prime Minister Modi to the northeast Indian state of Arunachal Pradesh where he inaugurated a local convention center as China also claims the area: “The Chinese government has never recognized the so-called Arunachal Pradesh and is firmly opposed to the Indian leader’s visit to the disputed area,” said a Chinese Foreign Ministry spokesperson announcing “stern representations with the Indian side.” Arunachal Pradesh, a strategically important border district, came briefly under Chinese control during the 1962 war. [Channel News Asia]

South China Sea: Philippines wants to stay out of great power rivalry as U.K. supports the U.S.

(ls) The Philippine government on Wednesday rejected Chinese names given to some undersea features in a vast offshore region where the Southeast Asian country holds undisputed sovereign rights. [South China Morning Post 1] As AiR reported last week, President Duterte ordered an end to all foreign scientific research missions in Benham/Philippine Rise after officials said the Philippines’ undisputed sovereign rights in the potentially oil- and gas-rich water off its northeastern coast came under question.

However, China has insisted that the military assets it is deploying on disputed islands in the South China Sea are not aimed at the Philippines and other neighboring countries. According to statements of the Philippine ambassador to Beijing, “it is part of the rivalry between a rising China and the US over the South China Sea,” and that the Philippines want to stay out of this great power conflict. [The Straits Times] As AiR reported last week, latest surveillance photos show that Beijing has nearly finished building air and naval bases on the seven islands it has occupied in the Spratly and Paracel island chains. At the same time, both China and the Philippines have agreed to push on with plans to jointly explore for oil and gas in the waterway.

Meanwhile, the United Kingdom announced that it will launch a freedom of navigation operation in March, supporting the United States’ approach on the issue. A British submarine-hunting warship will sail from Australia through the disputed South China Sea next month. “The US is looking for other countries to do more. This is a great opportunity for the UK and Australia to do more, to exercise leadership,” British Defense Secretary Gavin Williamson said. [South China Morning Post 2]

Asia: Enhancing military defense capabilities

(hg) Heightened geopolitical threats for peace in Asia have been identified as offering significantly growing opportunities by Lockheed Martin according to its executive vice president. [CNBC]

The Pentagon has just released the National Defense Strategy and a Nuclear Posture Review, the Defense Department is preparing now to issue another key document, another Ballistic Missile Defense Review, the first one after 2010. According to an unnamed defense official the document “will take a much harder look at Iran, North Korea and China”, adding: “Each of those countries has made huge strides both in range and lethality since [the 2010] assessment, and the Pentagon’s thinking about the threat, and planning for it, […]”. [Asia Times 1]

While defense spending has actually slowed down in 2017 for Asia as a whole, IHS Jane’s

expects the region to be “the driving force behind long term growth in global defense spending” in its recent assessment. [CNBC]

Global defense spending in 2018 is expected to reach the highest levels recorded since the end of the Cold War according to the annual Jane’s Defence Budgets Report. [The National Interest]

Japan has just approved the countries ever largest annual defense budget in December last year and China and India will also spend significantly [CNBC] while Russian defense spending continued to decrease in 2017, and is now 10 percent lower than in 2015. [The National Interest]

All in all, requests for advanced military systems are clearly on the rise across the entire greater region covered by AiR, made up by South, Southeast and East Asia. [Asia Times 2]

Between 2007 and 2016, according to SIPRI defense data, China had the biggest increase in military spending of 118%, followed by Russia with 87%, and India with 54%. Germany, ranking sixth had an increase of 6.8% followed by France with an increase of 2.2%. In 2015, the US spent about 36% of the total global military spending that year. In 2016, the USA spent 611 billion USD followed by China with 215 followed by Russia with 69.2, Saudi Arabia with 63.7, India with 55.9, France with 55.7, the UK with 48.3, Japan with 46.1, Germany with 41.1, South Korea is 36.8, Italy with 27.9 and Australia with 24.6 billion USD. [The Times of India]

Notably, India´s defense budget broke into the world’s top five now, replacing the UK for the first time and signaling a shift in the military balance between the two countries with India allocating more capabilities to develop its regional ambitions than the UK with the remnants of its global ambitions. [India Post] India´s rival China, however, affords the world’s second-largest defense budget after the US and remains far ahead with three times India’s defense budget. China’s real defense spending increased by nearly 25 per cent in 2016-17, whereas India’s rose by just 2.4 per cent. Since 2000, China has built more submarines, destroyers, frigates and corvettes than Japan, South Korea and India combined. Saudi Arabia, with a defense spending of USD 76.7 billion, came in third to complete the world’s top five behind the US, China, Saudi Arabia, Russia and India last year. [India Post]

In 2016, European Union countries transferred US$2.1 billion worth of weapons to Indo-Pacific nations, nearly the same as the United States ($2.3 billion). Russia was the macro-region’s largest supplier with $3.4 billion worth of arms, while China ranked fourth with $1.2 billion, according to the Stockholm International Peace Research Institute. [Asia Times 1]

Meanwhile US Pacific Command Commander Admiral Harry B Harris announced for the U.S. – Indian relations that “[d]efence sales are at an all-time high”. [The New Indian Express]

Singapore’s defense minister just reaffirmed this assessment in his recent Total Defense Day message commemorating the fall of Singapore in 1942 that independence would depend on strong military defense capabilities. [Channel News Asia]

In Bangladesh, military modernization is a long-term objective. Regarding the Air Force  Raihan Al-Beruni points to the need to develop an area denial strategy that he argues is lacking and urges the fast development of a reflected strategy assuming that the Chinese-made J-31 and the Russian Su-57 will dominate the Asian market in the near future. [Dhaka Tribune] 

China: Best implementer of Catholic social doctrine?

(dql) According to Bishop Marcelo Sanchez Sorondo, chancellor of the Pontifical Academy of Social Sciences, China is worldwide the leading country in implementing the Catholic social doctrine. Praising in an interview with Vatican Insider China for its defense of human dignity and moral leadership in the fight against climate change, the bishop criticized the USA for allowing the economy to dominate politics and liberal thought for its liquidation of the common good. [National Catholic Register] These statements follow last’s week breakthrough in yearlong secret negotiations between the Holy See and China about the resumption of diplomatic relations, almost 70 years after their cut off following the communist takeover in China in 1949. [AiR 1/2/2018]

China: Advancing surveillance

(dql) In the latest development of China’s attempt to establish a nationwide digital surveillance system, police offi-cers in the central city of Zhengzhou are using high-tech sunglasses equipped with facial recognition technology to identify criminal suspects in the city’s train station. The glasses carry a camera enabling officers to take police photo-graphs of suspicious persons and refer those pictures to a database back at police headquarters. Critics have voice concern over the potential for abuse of the technology. [BBC News]

Meanwhile, France-based international organization Reporters Without Borders has warned journalists and bloggers using Apple’s iCloud China that the security of their data and sources might be endangered from 28 February on when operation of iCloud services in China will be shifted from Apple to Cloud Big Data Industrial Development Co., Ltd., an enterprise closely linked to Guizhou provincial government. Critizing Apple for bowing to the Chinese gov-ernment, Reporters without Borders urged journalists to change their geographic region or to close their accounts. [Hong Kong Free Press]

Against the background of a rapidly developing digital surveillance system in China, Anna Mitchell and Larry Diamond forecast the possible establishment of an all-pervasive algorithmic surveillance system in the form of the social credit score system in a few years whose scope of data collected will very wide including not only online consumption and purchasing information and political posts online, but also the behavior of family relatives and friends. [The Atlantic]

China: Plans for military build-up in the Indian Ocean revealed

(dql) Following successful test of its ground-based mid-course defence system on Monday [Reuters], Chinese military experts on Thursday announced China’s plans to develop sea-based anti-missile systems to be deployed in the Asia-Pacific and Indian Ocean. [South China Morning Post]

China’s relations with regional political entities: ASEAN and African Union

(ls/dql) A gathering of ASEAN foreign ministers in Singapore ended on Tuesday. They agreed on the importance of non-militarization and self-restraint in activities in the South China Sea to avoid raising tensions in the disputed waters. Francis Chan opines that this is a promising sign of unity as ASEAN begins negotiations with China next month on a code of conduct to manage tensions. [The Straits Times 1]

In a parallel meeting, ASEAN defense ministers discussed ways to improve cooperation between China and ASEAN, and said they would conduct an inaugural ASEAN-China maritime exercise at the end of the year. Besides, the defense ministers agreed to enhance counter-terrorism cooperation, identifying terrorism as the region’s most serious security threat. [The Straits Times 2]

At the same time, recent surveillance photos show that China is nearly done building air and naval facilities on seven islands it claims in the South China Sea. The photos show that the runways for the three biggest islands – Fiery Cross, Subi and Mischief – have been completed or are ready for use. Lighthouses, radar domes, hangars and multi-storey buildings have been built on them, while helipads, wind turbines and observation and communication towers can be seen on four smaller islands – Burgos, Calderon, McKennan and Johnson South. [The Straits Times 3]

The Philippines, for their part, have disallowed groups from China and other countries to undertake scientific research in disputed waters. Philippine President Rodrigo Duterte issued the respective order in a Cabinet meeting late Monday after doubts were raised over the country’s sovereign rights in the offshore region called Benham Rise, which the government has renamed Philippine Rise. About 30 research permits are revoked. [South China Morning Post]

Meanwhile, at the seventh China-African Union strategic dialogue in Beijing this week, African Union (AU) Chairman Moussa Faki Mahamat and China’s Foreign Minister Wang Yi jointly confirmed to deepen cooperation between both sides, with Wang stating China’s readiness to become AU most reliable strategic partner. Cooperation between China and Africa has grown significantly in the last two decades, with the latest boost in 2015 when President Xi Jinping pledged investment in Africa worth 60 billion USD under the Forum on China-Africa Cooperation (FOCAC). [The Diplomat] [Brookings]

China-US relations: Agreement to pressure Pyongyang and overhaul trade relations amid adversarial rhetoric

(dql) US Secretary of State Tillerson and China’s top foreign policy advisor Yang Jiechi met this week in Washington for a lunch talk revolving around North Korea and US-Chinese trade relations. Both sides agreed on maintaining pressure on Pyongyang’s nuclear program and the need for further discussions on the promotion fair and reciprocal economic relations between the two countries. [The Japan Times]

The two-day visit of Yang followed Tillerson’s statement on China as new imperial power in Latin America during his Latin America trip last week [Foreign Policy] and the announcement of imminent punitive trade actions against China by Deputy US Trade Representative Wendy Cutler a day before Yang’s arrival in Washington. [South China Morning Post]

Meanwhile, China announced on Wednesday that its new fleet of advanced, Russia-built Sukhoi Su-35 jets have carried out a joint combat patrol over the South China Sea and called the move a reaction to a provocation of the USA referring to US destroyer USS Hopper shipping within 12 nautical miles of Huangyan Island, also known as Scarborough Shoal, claimed by both China and the Philippines. [Sputnik News]

China-Japan relations: Defense education exchanges to be resumed amid signs of thaw in Sino-Japanese ties

(dql) After a break of six years following Tokyo’s the acquisition of some of the Senkaku Islands from a private Japanese owner in 2012, a Sino-Japanese military educational exchange program will resume in spring this year. Chinese senior military officers and the Chairman of Japan’s Sasakawa Peace Foundation, which is in charge of this program, agreed on Monday on the resumption this program for the next five years. This move comes after signs of thaw in the relations between Beijing and Tokyo most recently expressed during Japan’s Foreign Minister’s visit to China and the agreement on reciprocal visits of the leaders on China, Japan and South Korea. [NHK World]

China: FCCC report on journalists’ working conditions

(dql) The Foreign Correspondents’ Club of China has released a report according to which working conditions for foreign correspondents in China has worsened in 2017, with journalists reporting being beaten, detained and harassed. [South China Morning Post/Agence France Press]

The Catholic Church in China: One step forward, two steps back?

(dql) Signs are pointing to a resumption of diplomatic relations between the Holy See and China, nearly 70 years after the cut off in the wake of the Communist takeover in China. According to a senior Vatican source, a framework ac-cord between the Vatican and China is ready and could be signed in a few months. After three years of secret nego-tiations it looks like a breakthrough in the core issue of the designation of bishops has been achieved. While details of the breakthrough are still not disclosed, observers assume that it could boil down to a compromise in which the Vatican agrees to recognize some of the bishops chosen by the Chinese Patriotic Catholic Association and Beijing in return a more benevolent stance towards the Church’s work in the country. [Reuters] China’s estimated 12 million Catholics are divided between underground congregations faithful to the pope and Catholic Patriotic Association where bishops are appointed by the government in collaboration with local Church communities.

For members of the underground congregations of successful negotiations comes at high price as two underground Chinese bishops, recognized by the pope, have been requested by a top Vatican diplomat to step down in favor of state-sanctioned prelates, with one of them ex-communicated by the Vatican in 2011. Against this background, crit-ics have accused the Vatican of selling out the Catholic Church in China. [Channel News Asia]

Meanwhile, Taipei Archbishop dispersed fears over a termination of diplomatic relations between the Holy See and Taiwan in the wake of the accord between the Holy See and China arguing that the Holy See maintains diplomatic ties with countries which uphold shared values of freedom, democracy, and human rights. [Focus Taiwan] The Holy See and 19 states are having diplomatic relations with Taiwan.

China: Security push in Xinjiang to be continued

(dql) The governor of the autonomous region Xinjiang has voiced in an official statement his determination to continue last year’s security crackdown in this region in the wake of perceived persistence of threats to the country’s unity and stability posed by Islamic terrorists and separatists. In 2017 Xinjiang witnessed increased police deployment and unprecedented surveillance measures which virtually transformed the region into a police state. [Reuters]

China: Pervasive anti-corruption mechanism on the way

(dql) A month ahead of the National People’s Congress at which the members of the central state organs will be elected and appointed, Wang Qishan, Xi Jinping’s right hand in the execution of the anti-corruption campaign, has been elected by the Hunan province party congress as one of 118 deputies of the province for the National People’s Congress. He is widely tipped to become Vice-President which would break with the convention of past decades that outgoing or retiring leaders would not be member of the NPC. Wang, 69, stepped down from the supreme, seven-member in October after reaching the Communist Party’s unofficial retirement age of 68. Analysts see Wang’s stay in the political arena as a strong signal for Xi Jinping’s continued commitment to his anti-corruption campaign [South China Morning Post 1] and his determination to build up a pervasive and centralized national supervision system across the country, with supervision commissions set up at both national and local level and topped by the National Supervision Commission (NSC). According to the draft of the National Supervision Law the NSC would be put higher than the Supreme People’s Court and the Supreme People’s Procuratorate and equipped with the power to oversee all personnel exercising public authority. [The Diplomat] AiR last week reported on launch the nation-wide anti-corruption campaign against middle- and lower level cadres launched early this month as complement to the existing campaign against top level state and party officials. [AiR 4/1/2018]

In a related development, the Ministry of Public Security Minister has announced a crack down on collusion between police and triads for which powers of disciplinary committee chiefs have been expanded allowing them to organize their own investigation teams or request additional personnel from elsewhere if the case involves a broad range of, or high-level, officials. [South China Morning Post 2]

China’s military build-up: PLA demands increase of nuclear warheads

(dql) In reaction to the 2018 US National Defense Strategy, a commentary in the PLA Daily voiced the need to expand China’s stockpile of nuclear warheads if the country wants to achiev a reliable deterrence capability. According to Song Zhongping, former member of the People’s Liberation Army’s Second Artillery Corps China needs to have several hundred nuclear warheads deployed at all times. [South China Morning Post] According to Arm Control Association, China possesses in 270 nuclear warheads compared to 6800 in the USA. [Arms Control Association 1] [Arms Control Association 2]

The demands to increase the number of nuclear warheads was expressed just a few days ahead of the release of the 2018 Nuclear Posture Review of the US Department of Defense on Friday which states that while “… the United States has continued to reduce the number and salience of nuclear weapons, others, including Russia and China, have moved in the opposite direction. They have added new types of nuclear capabilities to their arsenals, increased the salience of nuclear forces in their strategies and plans, and engaged in increasingly aggressive behavior, including in outer space and cyber space.” [US Department of Defense: NPR Summary] [US Department of Defense NPR: Full Report]

Meanwhile, online picture indicate the possibility that China has developed and installed a full-scale railgun on a warship, something which even the United States has not managed to do and which reflects China’s huge investments and rapid advancement in the field of military technology. [Popular Science]

China: Visits of Japanese Foreign Minister and UK Prime Minister

(dql) During the visit Japan’s Foreign Minister Taro Kono to China on Sunday and Monday this week, both countries agreed to resume annual meetings of the leaders of China, Japan and South Korea. This agreement reflects the climax to date of efforts which have been taken on Chinese and Japanese side to improve bilateral relations since last year. [The Diplomat]

Meanwhile, Prime Minister May’s visit to China this week focused on trade, in the wake of Britain’s Brexit. While sidestepping a formal endorsement of the One Belt, One Road Initiative, May secured trade deals worth 13 Billion USD. Both sides also agreed to establish a review body between the Chinese and British government on investment and trade with a view on a possible post-Brexit free-trade agreement. [South China Morning Post]

In assessing May’s visit in China , analysts point to the weak position of a Brexit-pressured UK Prime Minister vis-a-vis the Chinese President who is now increasingly focusing on the European Union in the frame of the OBOR initiative. [The Guardian]

South China Sea: China grows its influence as U.S. relies on freedom of navigation

(ls) After another “Freedom of Navigation Operation” by the U.S. navy, China has vowed to take “necessary measures” to protect its sovereignty. The missile destroyer USS Hopper had sailed within 12 nautical miles – an internationally recognized territorial limit – of Huangyan Island, which is also known as Scarborough Shoal and subject to a rival claim by the Philippines. The U.S. argued that the “innocent” was in accordance with international law. China’s defence ministry said the repeated dispatch of US warships to the region was “undermining regional peace and stability” and hurting bilateral relations. [The Guardian]

The Philippines, though defending the destroyer’s passage, are trying to avoid being caught up in the power game between the U.S. and China. Philippines Presidential spokesman Harry Roque said, “that is really a problem of America because we have come to a point that we now have an independent foreign policy, (…) the problem of America today is no longer the problem of the Philippines, (…) we are now trying to make friends (with China)”. [The Straits Times]

Against this background, Mark Valencia examines the decline of U.S. influence in the South China Sea, describing how U.S. allies such as Australia, Japan, and the Philippines have so far declined U.S. requests to join its freedom of navigation operations, and how Indonesia has expressed disapproval over such U.S. “power projection” in the area. [The Diplomat] In a similar vein, Gregory Poling holds that, with China’s growing influence across Southeast Asia, a diplomatic breakthrough is unlikely. From a U.S. perspective, he suggests that the Trump administration should begin giving the South China Sea as much attention as North Korea during diplomatic engagements with ASEAN states and other regional partners. [Foreign Affairs]

However, regarding China’s growing influence in Southeast Asia, Alvin Camba urges to not oversimplify bilateral relations along the lines of “play nice with Beijing, gain investment and aid”.  He argues that the pitfall in this theory is the assumption that states are the main actors in determining the flows of foreign direct investment. Choosing the case of the Philippines as a case study, he holds that the relationship between Philippine and Chinese leaders is surely important, but that it ultimately falls short of explaining the variations in the types of investments, and across different Philippines presidential administrations. [New Mandala]

China’s plans new international courts

(dql) China has decided to establish three international courts to deal with disputes related to the Belt and Road Initiative (BRI). They will be installed by the Chinese Supreme People’s Court in Beijing, Xi’an, the capital of Shaanxi Province and Shenzhen. The courts will be tasked with weighing litigation, arbitration and mediation; providing legal support and solving initiative disputes. [NDTV]

Analysts voice concerns over the independence and impartiality of theses arbitration courts as they will be under the Supreme People’s Court and possibly exposed to political pressure of the CCP. [CNBC]

China’s border security: Beijing’s plans for a military base in Afghanistan’s Wakhan Corridor

(dql) Beijing is holding talks with Kabul about the set-up of a military base in Afghanistan’s far Eastern Wakhan Corridor bordering Xinjiang in attempt to close entry points of exiled Uighur members of the East Turkestan Islamic Movement (ETIM) into Xinjiang. The talks follow months long joint Chinese-Afghan patrols which started last summer in this area and a meeting between the defense ministers in December. [NDTV]

Pakistan – US relations

(lh) After President Trump announced the stop of any financial aid to Pakistan, as he considered it as a “safe heaven” for Afghan terrorists, some legislative alterations in the US National Defence Authorisation Act (NDAA) will ensure the withholding of $350 million aid to Pakistan in 2018 until Islamabad uses significant measures against the Taliban and the Haqqani network. [Dawn]

Against this background, Pakistan’s defense minister Khurram Dastgir Khan announced the country’s plan to increasingly purchase arms from China, Russia and further Eastern European countries, stressing the already conceivable turn to China for military aid. [Newsweek]

Still there are nevertheless still efforts on both sides to ensure that these developments do not mean a complete renunciation of Pakistan-US relations. [Bloomberg]

Interesting in this context is a detailed account on Pakistan’s nuclear weapons and their capabilities. [The National Interest] 

Strategic Realignment in the Indo-Pacific: The American perspective

(hg) The background to the current strategic trend is particularly reflected by recent remarks of U.S. Admiral Harry Harris, head of the U.S. Pacific Command, at the annual Raisina Dialogue in New Delhi last month (see the last AiR issue). Admiral Harris bluntly referred to China as a disruptive power in the Indo-Pacific urging the countries in the region to build their capabilities and work together. The article in The American Interest highlights the shifting strategical assumptions and realigning power relations reflected by Admiral Harris’ widely registered remarks as well as Secretary of Defense Mattis’ visit to Indonesia and Vietnam (see below). [The American Interest]

U.S.–Indian rapprochement despite remaining concerns

(hg) The newly announced U.S. Defence Strategy with its the key priority to counter what it bluntly declares a growing threat from Russia and China puts great emphasize on the Indo-Pacific region where the U.S. will “strengthen our alliances and partnerships […] to a networked security architecture capable of deterring aggression, maintaining stability, and ensuring free access to common domains”, as defense secretary Mattis said.

With the great possibility that the U.S. and India will actually engage in a deepening and sustaining partnership to contain the Chinese expansion, the mutual perceptions vary slightly. India, arguably represents at present the probably most challenging and promising element of the U.S. approach to Asia. While important steps to realize the potential are done already and the U.S. have barely reason to fear a return to a Sino-Indo BRICS cordiality, there are some remaining points of concern from the Indian perspective which, nevertheless, enjoy a – currently – lower priority.

From the Indian side, some commenters point nevertheless to the U.S. President’s presumed unpredictability, which they fear could surface economically but also security related. Most crucial issues as one observer notes it are terror groups targeting India and the broader U.S. – Pakistan relations. [Modern Diplomacy] [The Quint] 

Second, the harshly formulated U.S. defense strategy could, so the fears, also catalyze geopolitical dynamics with respect to China and possibly push of Russia to enhance its partnership not only with China but also Pakistan. 

Equally possible according to the Indian assessments is thirdly possible U.S. – Indian discord due to India’s stance towards old allies as reported in earlier AiR issues. In fact, not only the mentioned drift in Indian-Russian relations, but also Delhi’s relations with North Korea and, more important, its vested interests in Iran could turn out to bear potential for tensions.

While the U.S. and important U.S. allies like Saudi Arabia and Israel display increasingly signs that relations with Iran could further deteriorate, Iran remains of crucial importance for India in negative and positive respects, namely to counter the Chinese influence in the Middle East but also to expand the very own presence with Iran as India’s gateway to Afghanistan, Central Asia and the Arabian Peninsula. The most prominent Indian investment in Iran is the Chabahar Port project. [Modern Diplomacy] [The Quint] 

Are Sino-Indian relations getting softer or tougher?

(hg) Some commentators observe a shift in China’s rhetorical stance towards India by offering to open talks with India to resolve differences on the China-Pakistan Economic Corridor (CPEC) and join the Belt and Road Initiative as to a Chinese foreign ministry spokesperson. [The Hindu]

Interesting in this context are remarks of Rong Ying, Vice President of China Institute of International Studies (CIIS), a prominent state-run Chinese think-tank affiliated to Chinese Foreign Ministry. In an article in the CIIS journal, the first of its kind by a Chinese think tank on the Modi government, Rong, who also served as a diplomat in India, acknowledges the reality of competition between the countries which he sees however to be possibly reconciled with a principled cooperation as well. Advocating a “strategic consensus of the two leaders”, Xi and Modi, he states that China would not be a hurdle but a major opportunity for the Indian development. [The Economic Times]

The actual room for friendly bilateral maneuvers has, however, already been limited by the Chinese foreign ministry’s spokesperson herself when offering a new partnership with Delhi as mentioned above. Significantly, the spokesperson, when confronted with China’s alleged military infrastructure buildup in the Doklam/Dong Lang area (see below), reiterated that this would be a project on China’s sovereign territory, offering thus a much less reconciliatory stance concerning the currently more crucial frontline between the countries than related to Pakistan. [The Hindu]

Against this background, recent remarks of a Chinese researcher are interesting who predicts that India’s new foreign minister will take an even tougher approach towards China than his predecessor. Actually, India’s new foreign minister Gokhale is considered an expert on China and has been India’s Ambassador to Beijing when the Doklam standoff erupted in June last year. [Times of Islamabad]

Rounding off the picture of bilateral assessments, another former Indian foreign minister has just expressed his deep suspicion about a rising China’s unilateral assertion and disregard for other countries as the defining challenge for India, a view particularly expressed regarding the inroads China is making in India’s neighbourhood, especially in Nepal. [The Tibetan Review]

An interesting ‘external’ assessment from the American side has been made a former U.S. diplomat stating that the present and future India-China ties would reflect a “Cold-War-like” relationship while New Delhi would be unlikely to join something framed as a US-led front to contain Beijing. [The Economic Times]

Deteriorating Sino-India border developments

(hg) A retired Indian colonel who has thoroughly analyzed satellite images of the disputed Doklam plateau has “shredded the veil of peace laboriously woven by India and China since they pulled themselves back from the brink of war last summer” [South China Morning Post].

According to him, the People’s Liberation Army is engaged in a military infrastructure build-up of significant magnitude. It includes concrete posts, helipads, new trenches, and a concrete observation tower less than 10 meters from the Indian Army’s most forward trench as well as fighting posts that have been created on almost every hillock on the North Doklam plateau. All this, so the retired soldier, has been implemented only after the 16 June 2017 resolve of the war-close tensions. The developments add to the fact, that China has actually never proclaimed that it was pulling back its troops. [South China Morning Post]

The Indian government, seems, however, not to remain inactive. To ensure faster movement of troops, the Indian government plans to build a 14-kilometer tunnel at an elevation of 13,700 feet through the Sela Pass which is located between the Tawang and West Kameng districts of Arunachal Pradesh, an area considered to be of great strategic importance in case of war. [Defence News] 

Remnants of better times between India and Russia

(hg) It is one of the significant expressions of the present process of a realigning Asian order that old friends estranged and new relations emerge. Among the greatest changes in this sense are the US-Pakistan and the Indian-Russian relations.  Yet, in case of the latter, there are still closer bonds than in the former. On occasion of the recent Indian national day, President Putin has now once more acknowledged the Indian nation’s achievements and expressed his appreciation for both country’s “relationship of privileged strategic partnership” [TASS], which, however, is arguably fading.

The actual perception from the Russian side seems well captured by an academic’s meanwhile published account on the Russia-Indian strategic dialogue and the related recent bilateral meeting and its “specifics”. The author acknowledges the reality of an Indian participation in the newly formed anti-Chinese alliance between the Asia – Pacific’s “largest democracies” but reiterates, at the same time, that India would still be interested in Russia’s approaches to the Greater Eurasian partnership, the Chinese Belt and Road initiative and how these initiatives can be linked to the plans to create a North-South corridor and other infrastructure projects of India. [Valdaiclub]

Even if this might sound a bit optimistic at present, not all is lost for the possibilities of Indian – Russian cooperation either as India may join hands with Russia for expanding its presence in the hydrocarbon sector in Vietnam reflecting another increasingly difficult, yet still standing friendship, namely those between Russia and Vietnam which the Russian side has kept when China and Vietnam clashed over South China Sea issues in 2014.

Despite growing US-Vietnamese ties, Vietnam, like India, still has long established military ties with Russia, possessing for instances Russian SU-27 fighter jets, kilo class submarines and Yakhont missiles. India, on its part, is also planning to sell its Brahmos missiles, which it has jointly developed with Russia to Vietnam. All these ties and recent moves however do not change the more dominating reverse trend in all three country’s relationships whereas they do show that the strategic realities remain complex and dynamic. [The Economic Times]

US seeks to engage Indonesia and Vietnam to counter Chinese maritime expansion

(hg) U.S. Defense Secretary James Mattis’ visit to Indonesia – before a visit to Vietnam – highlights the American efforts to enhance regional strategic partnerships to counter China’s expanding presence in Asian waters reiterating the basic themes of the just announced US National Defense Strategy. While Indonesia – despite not a claimant state in the South China Sea issues – has come forward to protect its exclusive economic zone off the Natuna Islands where it overlaps with the southern reaches of China’s self-proclaimed “nine-dash line”, Indonesia also courts China economically to invest.

Noteworthy, Mattis could not escape criticism of the U.S. recognition of Jerusalem as Israel’s capital and was confronted with the call to support  a two-state solution regarding the Israel-Palestine conflict with East Jerusalem as the Palestine capital. [Nikkei Asian Review]

Thailand in the newly emerging Asian security order

(hg) The Diplomat highlights Thailand’s cooperation with Beijing in the defense realm in light of recent weapon deals with China indicating that the long-established bilateral relations are constantly deepening since the 2014 military coup. [The Diplomat]

The observation of a Sino-Thai rapprochement has to be measured in context though. It is first of all none which is sharply breaking with diplomatic traditions and also not openly provoking established expectations. Rather it might currently be seen as a gradual enhancement which compensates the somehow inevitable temporary post-Coup recession of Thai – US ties, while it also reflects a generally growing Chinese imprint in the region, albeit in a less dramatical form than in many other ASEAN states.

Different from neighboring states like Cambodia and Laos, Thailand still is a close partner of the U.S. and yet, different from Vietnam for instance, also a constant, even if frequently less visible close partner to China which, undisputable, gains relatively influence. Yet, most of all, Thailand is a country pursuing one of the most skillful bamboo diplomacies in the region, a craft that has been cultivated since the days of the beginning Cold War and the non-alignment movement. Recent Sino-Thai developments have to be seen within this frame and within it they make all sense without indicating a profound re-alignment. For the present military government, arms-deals with China seem to have been more convenient than with Western partners for some reasons but should not be overestimated. Regarding its flexible foreign policy in times of aligning spheres of influences, Thailand remains one of currently most interesting countries to watch in the Indo-Pacific region. Given its geo-strategic location, its weight within the ASEAN, its relative stability and long-established partnership with NATO, any sustaining changes to the dominating foreign policy direction would represent one of the more interesting regional developments indeed.

Against this background, the Bangkok Post offers an interesting comment on Thailand’s weight in the Indo – Pacific region that, arguably, reflects the Kingdom’s long established foreign policy dichotomy as much as the shifting realities with the ‘Quad’ dialogue at the center of the current dynamics.

According to Kavi, the author, “Thailand does not want the Indo-Pacific to concentrate on consultations” among the Quad as a major mechanism in the frame of the new US National Defense Strategy with its blunt qualification of Russo and Sino threats at its heart. The instead highlighted Thai preferences for a broader, less security focused Indo-Pacific community might remain a possible goal, but also one which will face increasing pressure by the inevitably emerging tenets of the developing security architecture.

The second point made in the article is a more inclusive security cooperation for the sake of stability and prosperity, both on land and at sea. At the first glance, the reiteration of Thailand’s particular geopolitical location between the Pacific and Indian Oceans and as the destination of important Asian rivers, also hints at the preference to continue an enhancement of connectivity and communication with China. [Bangkok Post]

While Thailand is assumed to support India’s greater engagement in ASEAN and to be integrated in the regional security dialogue with the Cobra Gold exercise leading the way, it is also expected to resist attempts to “turn the Indo-Pacific into a bulwark against China or Russia”. With Thailand taking up the ASEAN chair next year, it will be interesting to see in how far it might successfully mediate with those ASEAN states welcoming the Quad’s entrenchment, with those siding with China, and those who might have their own agenda of a more independently acting ASEAN. [Bangkok Post]

Currently, Thailand seems to pursue a much less accentuated, strategically directed foreign policy regarding the security related looming of greater spheres of influence than other regional actors do. If this will turn out to be a missed opportunity, a blessing or at least to offer the potential to assume the role of regional mediator by which it could buy some time to preserve its dichotomous foreign policy approach remains to be seen.

The China-Maldives Connection

(hg) With a new, unexpected FTA, China cements its influence in the Maldives, much to India’s dismay. Signed on December 8, 2017, as the Maldives’ first FTA with any country, the Maldives has become the second South Asian country to sign an FTA with China after Pakistan.

Moreover, the Maldives also signed a Memorandum of Understanding that brings it into the Maritime Silk Road [Maldives Independent], a component of China’s Belt and Road Initiative (BRI) seconded by a number of bilateral cooperation treaties. The article in The Diplomat highlights some background information of the development that has been covered by recent AiR issues as well. [The Diplomat]

India’s new military presence on the Seychelles and concerns over Chinese influence in Sri Lanka 

(hg) India and the Seychelles signed a revised agreement that will allow India to build military infrastructure on Assumption Island, that will expand its strategic reach in the Indean Ocean.

Initially, the agreement had been signed in 2015 to be suspended because it had not been ratified by the Seychelles parliament prompting previous President of the Seychelles, Faure announced last year it would have to be re-negotiated.

The agreement shall enhance the cooperation pertaining anti-piracy operations and enhanced EEZ surveillance to prevent intrusions by potential economic offenders indulging in illegal fishing, poaching, drug and human trafficking and generally the Seychelles’ defense assets and capabilities. [Jane’s 360] [The Times of India]

The final conclusion of the agreement follows an unannounced visit of India’s Foreign Secretary Jaishankar to the Seychelles after the Seychelles-China cooperation has been rapidly growing in the recent past. Giving the Indian military interests on the islands, the deal securing them is indeed of great “strategic significance” for India. [India Today]

Meanwhile, India is indicating security concerns over Sri Lanka handing over the control of Hambantota Port to China with Indian Defense Minister Nirmala Sitharaman having publicly raised doubts whether China would confine itself only to [peaceful] port activities, hinting at the port’s ‘dual use’ capacity. [Daily Mirror]

India working against the trend in Nepal?

(hg) After the overwhelming election success of the joint communist forces in Nepal which is widely assumed to give China a strategic advantage over India, the Indian government has worked quietly over the past two months to secure its stakes in the Himalaya state. After all, almost all of the Nepalese people live on the Indian side of the Himalayas, while Nepal takes up half of the mountain border between China and India.

Following PM Modi’s telephone call Nepal’s coming communist leader Oli immediately after his election, several high-level contacts were established between Delhi and Kathmandu culminating in Indian Foreign Secretary Sushma Swaraj’s visit to Nepal ahead of the now expected government formation. Oli, in turn, wrote on the occasion of the Indian national day to PM Modi that he was eager to work with the Indian government. [The Economic Times]

China: Prominent human rights lawyer’s license cancelled

(dql) Following the detention of outspoken party critic Yu Wensheng last week [AiR 3/1/2018], Guandong province government authorities have revoke the license of prominent human rights lawyer Sui Muqing on grounds of violating China’s law for lawyers and rules of conducts for lawyers. As evidence, the authorities referred to a case where Sui failed to prevent a client from disrupting court order in Beijing in 2014, as well as to his taking photos in a police station in the southwestern province of Sichuan in 2017 where he met a client. [Reuters]

China: Tightened controls in Tibet and Xinjiang

(dql) An administrative takeover by the Communist Party of the Tibetan Buddhist monastic center of Larung Gar has been ordered by government authorities. According to an official announcement all top-level administrative matters will be in hands of party cadres ranging from management, finances, security, admissions, to even the selection of textbooks use at the center. Until expulsions and demolitions measures taken by the government in 2017, Larung Gar was the largest center of Buddhist monasticism in Tibet, if not the world, and had been run by Tibetan monks and nuns selected by the monastery’s senior members. [Human Rights Watch] This takeover follows a trial against Tibetan language and culture activist Taishi Wangchuk for separatism early this month [AiR 1/1/2018] and reflects a new climax in the the party’s efforts to control religious affairs and practice in Tibet.

Related to another minority group, Radio Free Asia this week spoke of around 120,000 ethnic Uyghurs being kept in detention for political re-education. The news group refers to information obtained from a security official. [Radio Free Asia]

China’s anti-mafia campaign amid fears of judicial abuse

(dql) Complementing the existing anti-corruption campaign against high-level party officials, China has now launched a nation-wide anti-corruption against middle- and level cadres in an attempt to fight triads and tackle organized crime at the grass-roots-level. The campaign follows decisions made two weeks ago at a closed meeting of the Central Commission for Discipline Inspection, China’s top anti-corruption agency, and involves close to 30 party and government organs. Critical observers point to the danger of abuse of power by involved law enforcement agencies to meet targets of the campaign set by the party leadership. [South China Morning Post]

India: Modi’s bid for global leadership in Davos

(hg) This year´s Davos opening – speech by Indian Prime Minister Modi was of some significance to mark India’s actual stakes in the shifting global order. Last year, President Xi Jinping has conveyed a strong message that China would be ready to take up the mantle of global leadership that President Trump seemed to have just discarded. Now, some commentators have attributed India the potential to become “the sort of leader that an authoritarian China can never be, that a fractured Europe is failing to be, and that an inward-focused U.S. is refusing to be”. This would be a leader that “pushes forward equitable global trade, that seeks new pathways to controlling climate change, and stitches together multipolar and norm-following approaches to global security.” [Bloomberg]

Yet, such a perspective and goal seems to imply a picture way to rosy for present-day India [Quartz] and, moreover, also not the vision the normally eloquent Modi did fully live up to portray in his speech. In fact, talking much on India’s attractiveness for foreign investors, he arguably rather failed to deliver a determined and sufficiently palpable vision of Indian leadership, especially if compared with those of Xi. With the US ceding space not diplomatically but also strategically Modi did, however, importantly emphasized globalization as a key issue of future global ordering, suggesting “a cooperative, harmonious, sharing and caring world”. [The Economic Times] In noteworthy contrast to US positions and actions he explicitly mentioned three key global issues particularly silent in recent US proclamations to be taken up decisively: climate change, terrorism and anti-globalization. [Bloomberg]

Warning in this context against a new wave of protectionism with trade barriers posing a danger to the world on par with climate change and extremist attacks, he did so just hours after the U.S. government had approved new tariffs for instance. [ABC News] At the same time, the recently released US National Defense Strategy has dropped climate change and terrorism as primary foreign policy focal points replacing them with great power competition with China and Russia.

India and the revived ‘security ‘quad’

(hg) The navy chiefs of the four ‘quad’ nations that recently reconvened the old quadrilateral security dialogue of Japan, Australia, India and the US came together at a security conference in New Delhi. The admirals displayed their unity in their perception of China as a “disruptive power” in the region. Just recently Japanese Prime Minister Abe had underlined the ‘quad´s’ shared strategic values. While Japan is more inclined to actively engage in military alliances than India, India arguably is currently even more challenging to China psychologically than is Japan. [The Australian]

Interesting in this context are insights offered by a former Indian secretary of the Ministry of External Affairs on how India viewed the revival of the four-country security dialogue as a necessary part of the shared containment strategy towards “an increasingly belligerent China” but with some initial hesitation. Anil Wadhwa, having been in office until mid of last year, revealed that New Delhi was initially skeptical of reconvening the ‘dialogue’ because of the Australian Rudd government’s decision ten years ago to abandon the first attempt to forge the group as a result of Chinese pressure. Seemingly, intense negotiations were needed to persuade India to re-embrace the quadrilateral dialogue amidst doubts about Australia’s reliability with Japan playing a particular role. [The Australian] 

Pakistan-Chinese representatives vowing to jointly support peace in Afghanistan

(jl) At a meeting between Pakistani National Security Adviser Nasser Janjua and the Chinese Ambassador in Islamabad both country´s representatives have announced to support constructive efforts for peace and stability in Afghanistan. [The Nation]

How good is the current deterioration of US-Pakistani tensions for China?

(hg) Ankit Panda, a senior editor at The Diplomat, provides an interesting perspective on the Chinese interest in the constantly deteriorating US-Pakistani relations claiming that it “would be a mistake to presume that China is glad to see a” full breaking apart.

First, while both the US and China provide important assistance to Pakistan they do so in different ways. A China-Pakistan Economic Corridor that gains steam would still not generate that sort of aid the US is providing. Second, sufficiently close US – Pakistan relationships pose a similar burden on US – Indian ties as comparative Indian – Russian or Indian – Iranian ties could do. For China it seems preferable that the US sustains principled relationship with both Pakistan and India investing resources without gaining India as a partner of an operationable anti-China entente. [South China Morning Post]

These observations are important as a reminder of the complexity and ambiguity of great power competition. There will always be the possibility of draw backs, paradoxical developments and tensions in bi- and multilateral rapprochements, especially where one country is absorbed by another´s sphere of influence or uncertainty exist weather two aligned distinct spheres of influence emerge instead. Yet, India and China have driven the regional power game to a point where a real US – Indian entente seems possible whereas Pakistan´s value and the burden of an ‘engagement of attrition’ will also be assessed from the US point of view.

Bangladesh cancels Chinese road construction project on corruption charges

(hg) Bangladesh has cancelled a road construction project with a major Chinese company for allegedly having attempted to bribe Bangladeshi officials. The government has blacklisted the firm from participating in any future ventures. It is the same company that has undertaken so important projects as Pakistan’s Gwadar Port and Sri Lanka’s Hanbatota Port. The case raises the question how the government’s reaction will affects the country’s ties to China in general in the near future. [ANI]

Sri Lanka caught in great power politics

(hg) With Japan and India seeking to deepen their influence in Sri Lanka, the poor country which has become an integral part of the Chinese ‘maritime silk road’, seems to be caught between the need for foreign investment and the risk to be taken away by great power competition. [AiR 3/1/2018] [The Diplomat 1] [The Diplomat 2]

Adding to its recently expressed interest in infrastructure investment, Japan also plans to increase its naval security aid to Sri Lanka and Djibouti in support for the joint Japan-U.S. “free and open Indo-Pacific Strategy” which is not just countering the emergence of a Chinese sphere of influence abstractly but representing a new willingness to actively move very close to core areas of Chinese interest and investment. [The Japan News]

Besides, Sri Lanka’s increasing geopolitical importance has also been reflected currently by the visit of Singapore’s Prime Minister Lee Hsien Loong to witness the signing of the Sri Lanka-Singapore free trade agreement. [Channel News Asia]

The agreement, which is the first modern and comprehensive FTA for the South Asian nation after an attempt to reach an agreement in 2004 failed. [Today Online]

Adding to the overall picture, also Indonesian President Widodo has just visited the island to discuss matters of bilateral investment cooperation. [Daily Mirror] 

Maldives: Opposition criticizes alleged sell-out to China

(hg) The exiled former Maldives’ president Nasheed warned that this year’s presidential election could be the last chance to save his country from an ever increasing Chinese influence invited by the current Yameen Abdul Gayoom government without any regard for due procedure or transparency. [The Standard]

Commenting from his exile in neighboring Sri Lanka, Nasheed, who was convicted of terrorism charges at home, reiterated that China’s growing influence in the Maldives threatens the peace and stability in the entire region. The remarks prompted strong responses from the Maldives government whose incumbent president has linked his fortune to China since taking office in 2013 which just culminated in the country’s first bilateral free trade agreement which the government has signed with China late last year. [Avas].

Lately, India, the EU and the US take increasing interest in the developments on the strategically important Maldives, regarding both, a worsening domestic governance and security situation as well as the Chinese advancement.

Indonesia-USA relations: Washington backs Jakarta in South China Sea; current challenges for Indonesian military

(ls) On his visit to Indonesia this week, U.S. Defense Secretary Jim Mattis accepted the country’s renaming of an area previously considered part of the South China Sea, a move that potentially upsets China. In July last year, the Indonesian government unveiled an updated national map in which the country’s exclusive economic zone north of the Natuna Islands had been renamed the North Natuna Sea. While China recognizes Indonesian sovereignty over the Natuna Islands, it insists the two countries have overlapping claims to maritime rights and interests in the area that still need to be resolved. [South China Morning Post]

Defense Secretary Mattis also promised that the U.S. military will increase cooperation with Indonesia’s 6,000-member elite special forces unit “Kopassus”. Contacts have been scarce as Kopassus was accused of rights abuses in East Timor in the past. Mattis said he believed Kopassus had reformed enough that more cooperation was warranted under existing law. The United States is one of Indonesia’s top arms suppliers. [Reuters]

Within the Indonesian military, Air Chief Marshal Hadi Tjahjanto, the former air force chief, has taken office as the 20th commander of the Indonesian Armed Forces (TNI) in December. “The Diplomat” argues that a major question for Tjahjanto, with his minority background from the Air Force among the TNI branches, will be the extent to which he can solidify all three branches of the military under his leadership, particularly the army, which has dominated the Indonesian military for years. Another crucial issue is to what degree Tjahjanto can bring the military defense plan back in line with the changing dynamics in the region and also with the current administration’s grand policy. [The Diplomat]

U.S.-Vietnam relations to counter Chinese influence

(ls) U.S. Defense Secretary Mattis is also visiting Vietnam. The Trump administration sees Vietnam as a partner in opposing China’s assertion of territorial claims in the South China Sea, including the Spratlys, an island chain where Taiwan, Malaysia, the Philippines, Vietnam and Brunei also have claims. However, on occasion of Mattis’ visit, which takes place almost exactly 50 years after the Tet Offensive in the Vietnam War, memories of the past may also play a role during the visit. Mattis has never been in Vietnam before. [South China Morning Post]

To change Asian geopolitics in Thailand: The Kra – canal

(hg) Since 1677, an ambitious canal project, the Kra – canal, has been contemplated in Thailand in various forms to re-surface now with huge potential impact. This long-envisioned channel through the country’s southern isthmus would connect the Indian and Pacific Oceans and dramatically shorten East-West shipping routes. It would, in fact, save approximately 1,200 kilometers posing an alternative to the Malacca Strait, the world’s busiest maritime area where an estimated 84,000 ships and around 30% of global trade currently passes each year with an estimated increase to over 140,000 per year. Moreover, as much as 80% of China’s fuel imports currently pass through the Malacca Strait. To build the Kra – canal would severely hurt Singapore, potentially form an important part of the Chinese maritime silk-road and cost between US$20-US$30 billion.

If built, the Thai canal would change the Asian geopolitical environment at sea significantly by bypassing Malacca which is easily controlled by the US navy. Even if built, however, the US Navy could still choke the new entry points, the greater efforts notwithstanding. Still, it would create a lane of communication of huge importance giving advantage probably to China.

At present, the Thai Canal Association (TCA), a group of influential former top brass soldiers advocating for the project, is reinforced in its efforts by the Chinese government. Until now, Beijing has publicly distanced itself from private Chinese companies which had engaged Thai trade and lobby groups in favor of the mega project. As a surprising change, China´s newly appointed ambassador to Bangkok seems now to have said in recent high-level meetings that China envisions the Thai canal as part of its US$1 trillion ‘One Belt One Road’ (Obor) global infrastructure initiative. Naturally, this created a new momentum whose backgrounds, implications and potentials are well explored in the Asia Times piece. [Asia Times]

China: Ideology matters in achieving international leadership

(dql) The driving ideological force behind the rapid modernization of China’s military forces is expressed in President Xi Jinping’s demands towards the military of being ‘absolute loyal to the party’ and ‘capable of winning wars’. These words are is not be considered as outdated slogans of a brainwashing campaign for China’s soldiers but understood as essential part of China’s military strategy and political warfare, embedded in an assertive foreign policy which leaves Deng Xiaoping’s ‘keep low profile, abide by the time’ behind and claims global leadership role for China. [The Diplomat]

China: Shipping routes in the Arctic to be developed

(dql) In a move to widen her land and sea connections within OBOR initiative, China introduced in a white paper on Friday the vision of a ‘Polar Silk Road’ and announced plans to develop shipping routes to the Arctic. For China, the north-east passage offers a faster sea route to many ports in Europe than the current routes using, in many cases, the Suez or Panama canals. [BBC]

China-USA relations: Confrontation looming

(dql) Signs are pointing to confrontation in Sino-US relations after the release of the US 2018 National Defense Strategy which identifies China as ‘revisionist power’ and ‘strategic competitor‘ ‘leveraging military modernization, influence operations, and predatory economics to coerce neighboring countries to reorder the Indo-Pacific region to their advantage’ [US 2018 National Defense Strategy]. China has denounced the strategy for reverting to a ‘cold war and zero-sum mindset’ leading only to ‘conflict and confrontation’. [Xinhua] Analysts indicate that this confrontational strategy will possibly negatively affects the US position in the Asia-Pacific as it forces states of this region to align with one of the two powers. Given China’s power and position in this region they might turn to the Middle Kingdom and alienate from the US. [South China Morning Post 1]

In a related development, China has strongly objected US President Donald Trump’s decision to issue increased tariffs on imported solar power components and washing machines and accused him of abusing trade remedies. [South China Morning Post 2]

India/China: Education, higher education/professional training, and research

(hg) With all its success and ambitions, India has yet a lot of unfulfilled potential in terms of education and research if compared to China.

A first issue concerning India is the class divide that dominates the education system with a vast gap especially also between education in rural and urban areas. While the top 10% will be able to get good jobs and compete with the best in the world, the most will have a precarious living in the informal sector. According to recently published Annual Status of Education Report after eight years of schooling, only 43% of 14-18-year-olds could do simple division; more than 40% couldn’t tell hours and minutes from a clock; and 46% didn’t know which was Indian capital. [Livemint]

An interesting, currently debated strategy to improve the (higher) education status in India is an increase in online education and training. A recent deal between Indian IT major Tech Mahindra and edX, an online learning destination founded in 2012 by Harvard University and the MIT, reflects the potential of e-learning with edX reskilling 117,000 of Tech Mahindra employees. Coursera a venture capital backed, education focused tech firm founded by two Stanford professors has already attracted 2 million learners in India alone taking on 60,000 new learners every month. [ZDNet]

Meanwhile, China’s research and development (R&D) policy figures impressively according to the biennial science and engineering indicators recently published by the US’s National Science Foundation and National Science Board. As the world’s 2nd largest spender in R&D after the US, accounting for 21% of the world total of $2 trillion, China, focusing on becoming a world leader in artificial intelligence, quantum communications and computing, biotechnology and electrical vehicles, is, in fact, becoming a scientific and technical superpower. Contributing to this development is the ‘Thousands Talents Plan” and the ‘Thousands Youth Talents Plan’ that targets scientists below the age of 40 with a PhDs from prestigious foreign universities whom the government offers 500,000 RMB ($80,000) lump sum and research grants ranging from one to three million RMB ($150,000-$300,000). Both plans are complemented by the ‘Recruitment Program for Innovative Talents’, which is targeting foreign academics [1000 Plan] By it, more than 6000 high-level oversea workers have already been recruited [China Daily].

For a comparison between the Chinese and the Indian policies to reach out to both countries’ highly skilled professional diaspora see [The Diplomat].

China: Human rights and democracy activists detaineds

(dql) Yu Wensheng, one of the most outspoken human rights lawyer and critic of the Communist Party rule in China, has been arrested on Friday. The 50-year-old attorney who tried to sue authorities for failing to protect citizens from pollution openly criticized Xi Jinping as “marching backwards” and “unfit for office”. [The Guardian]

Meanwhile, Joshua Wong and Raphael Wong, two of Hong Kong’s most vocal democracy activists, have been sentenced to three months and four-and-a-half months imprisonment for obstructing a court order to clear a demonstration site during the Umbrella Movement in 2014. [Hong Kong Free Press]

China bans children in predominantly Muslim county from attending religious events during winter holidays

(dql) Government authorities in a Muslim-majority county in China’s North-Western Gansu province have issued a notification banning children from attending religious events and prohibiting them from reading religious texts in classes and religious premises during their winter break. This step follows last year’s revised laws on religious affairs aimed at tightening control over religious education and activities [Reuters]. AiR last week reported on the recent demolition of two Christian churches in two Northern provinces.

China’s zero tolerance in terms of political loyalty and discipline

(dql) Following the closure of a three-day closed meeting on Saturday, China’s anti-corruption agency, the Central Commission for Discipline Inspection, has issued a communiqué setting securing political loyalty and discipline of officials and fighting political corruption of interests groups , which undermine state power and party unity, as top priorities of the Commission’s policy. The meeting was the first gathering of the members of the Commission since they had been elected at the National Party Congress back in October last year. [South China Morning Post]

China: New facial-recognition surveillance system in Xinjiang tested

(dql) Government authorities in Xinjiang have started to test in Muslim-populated villages a new facial recognition system that is claimed to be able to alert authorities when targeted people leave designated “safe areas”, such as an individual’s home and workplace, further than 300 meters. Security cameras are linked to a database of people who have attracted the attention of authorities and whose movements are tracked within a particular area. This is the latest step in a development of the recent years that has transformed Xinjiang in a virtual police state exercising surveillance to an unprecedented degree, including harvesting of biometric data, smartphone scanners, voice analysis and compulsory satellite-tracking systems for vehicles. [Bloomberg] [The Guardian]

China: ‘State-managed internet’ and its possible impact on global internet governance

(dql) International companies reported that their China offices have recently repeatedly been facing disruptions while trying to access the global internet via virtual private networks (VPNs) which the companies use to circumvent government censorship. To access the access they to resort to costly international roaming services or to state-approved VPNs exposing them to government scrutiny. These reports shed light on growing efforts of the govern-ment to control online data and information flows within and in and out of the country. Defying critics of violating internet freedom, China insists on its cyber sovereignty pursuing the concept of a ‘managed internet’ with the state as focal point of internet governance.

With China representing more than 20% of internet users worldwide and a resurgent stress on national sovereignty, this concept and the ensuing policies of the Chinese government will inevitably transform global internet governance under Chinese sign unless an alliance can be formed upholding multi-stakeholder governance and free internet access as human rights, Scott Shackelford. [Financial Times] [China Policy Institute: Analysis]

China: Is Beijing proselytising its path to success?

Without overtly contesting Western ideologies and political systems, China nevertheless forcefully presents its system of a socialist democracy with Chinese characteristics as a model for developing countries. The questioning of the legitimacy and efficacy of Western liberal democracy in countries around the world plays into Beijing’s cards [East Asia Forum].

China: Church demolition sparks fears of campaign against Christians

The blasting of two Christian churches within a month in two provinces in Northern China have triggered fears of an anti-Christian campaign in China. The demolitions follow last year’s revision of laws regulating religious affairs which Church official view as an instrument to increasing control over religious communities and religious life by repressive measures ranging from limiting the construction of statutes outside churches to imposing fines for holding ‘unauthorised religious activities’. [The Guardian].

China: Centralization of power under Xi Jinping

dql) Since 1 January 2018, China’s National Police has been put under direct control of the Central Military Commis-sion with Xi Jinping as its Chairman. This step, along with the recent decision to fill local Party Standing Committees with military personnel, signals a substantial advancement towards a centralization of power within China’s govern-ance system which Xi has been pushing for since he came to power in 2012 [The Financial Times] [The Diplomat].

According to Jessica C. Teets, Xi has successfully overcome the decentralization of the power prior to his taking office in 2012 and re-centralized power in China by creating leading groups in the Party to oversee state functions, carrying out a sweeping anti-corruption and party discipline campaign against provincial officials to transfer law enforcement powers from the local level to the center, and controlling media and social organizations to an unprecedented de-gree [China Policy Institute: Analysis].

In a related development, the members of the Central Commission for Discipline Inspection, China’s top anti-corruption agency, have gathered onThursday for a three-days closed meeting to decide over the further direction of the anti-corruption campaign launched by Xi back in 2012. It is expected that the Commission, which comes together for the first time since its members had been elected at the Party Congress in October, will agree upon the estab-lishment of a National Supervisory Commission, a single agency that would integrate all of the existing anti-graft bod-ies from both the party and government [South China Morning Post 1].

In his speech at this meeting, broadcast nationwide via live stream, Xi demanded that the “decisions and plans laid out by the party’s central leadership should be implemented to the letter by all party organisations” and urged party officials to be “always politically reliable, loyal to the party, be of one mind and one heart with the central leadership, listen to the party’s instructions and fulfill their responsibilities at all times and under all circumstances.” [South China Morning Post 2]

China: Why Xi Jinping is once again letting China’s military have a direct link to local authorities

Official announcements have revealed that military personnel will from this year on be seated in party standing committees on local level paving the way for the military to not only be involved in local administration, but even to take over powers from the civilian authority in some areas such as the power to suppress protests and respond to natural disasters as well as violent attacks [South China Morning Post].

China: Hong Kong demonstrators vow to protect the city against further infringement of city’s autonomy

On a march New Year’s Day thousands of Hong Kong’s citizens demonstrated against the increasing undermining of the city’s autonomy by the Chinese government. The protest was mainly directed against the so called co-location arrangement between Beijing and Hong Kong endorsed by the National People’s Congress last week: a controversial plan to establish a joint checkpoint at the Hong Kong’s West Kowloon station of a high-speed rail link that will connect Hong Kong with Shenzhen and Guangzhou, scheduled to start operations next year [Reuters]. Critics view the agreement as in contradiction to Hong Kong’s Basic Law undermining the city’s autonomy by allowing mainland officials to enforce mainland Chinese laws for the first time on Hong Kong soil – specifically over a part of the checkpoint area leased to them at the terminal [Hong Kong Free Press].

China: Tibetan-language activist stands trial on separatism charges after appearing in New York Times video

Tibetan-language activist Taishi Wangchuk has been pre-trial detention for two years on allegations on inciting separatism. Standing trial on Thursday and facing up to 15 years imprisonment, he pleaded not guilty on grounds that he has not been advocating Tibet’s independence but fighting against the marginalization of Tibetan language and culture at schools [South China Morning Post] [The News Lens, in Chinese]. Amnesty International has condemned the trial as “shame trial” on the basis of an “absurd charge” [Amnesty International]. In a related development, Bayangol No. 3 High School, the last school to provide instruction in the Mongolian language in the Bayangol Prefecture in China’s northwestern Xinjiang Uyghur Autonomous Region was banned from using Mongolian earlier this week [Southern Mongolian Human Rights Information Center].