Yup, dead Nazis. That’s the subject of my weekend column for RealClearHistory. An excerpt:
8. Karl Haushofer (died 1946). While it is perhaps unfair to include Haushofer in this list (he denied being a Nazi and his wife and son were, under Nazi law, considered to be “half-Jews”), his ideas about the world and how he went about promoting them are too important to leave out of the Nazi story. Haushofer became a geopolitical theorist after World War I and is credited with introducing to the German public (including the Nazis) the idea of “Lebensraum,” or “living space.” According to Haushofer, Germany could only compete with the Western powers if it had control over areas of Europe stretching from Norway to the Caspian Sea. Once the German military controlled this geographic space, the Nazis could begin exterminating the indigenous people there to make room for German colonists. Haushofer also viewed Japan as a natural ally of Germany and was instrumental in convincing the Nazis to partner up with Tokyo. One of Haushofer’s former students, Rudolf Hess, was one of Hitler’s closest confidants, and it’s unlikely that Haushofer, bitter about the terms of peace imposed on Germany by France and the U.K. after World War I, did not exploit his former student’s position as Deputy Führer. He and his wife committed suicide together in 1946. Their son had been murdered by the S.S. in April of 1945.
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Chinese President Xi Jinping recently attended the Eastern Economic Forum (EEF), hosted by the Russian city of Vladivostok, which was held on September 11th and 12th of 2018. President Xi (who became the first Chinese President to attend the EEF) met with Russian President Vladimir Putin for the third time in as many months. Significantly, Japanese Prime Minister Shinzo Abe also attended the Forum, which was titled “The Russian Far East: Expanding the Range of Possibilities.”
Both Xi and Putin repeatedly referred to not just their close personal rapport (Chinese President Xi Jinping, while referring to their individual ties, stated that his and Putin’s ‘friendship was getting stronger all the time’), but also the deepening of economic and strategic ties between Russia and China, as well as the convergence on key global issues (neither side missed the opportunity to target the US for it’s inward looking economic policies).
China was also participating in military exercises, held in Siberia, which have been dubbed ‘Vostok 2018’ (Beijing clarified that these military exercises were not targeted at any third party). The military exercise (September 11-17, 2018) involves 300,000 troops, 1,000 planes, and a number of warships. China sent over 3,000 People’s Liberation Army personnel for the military exercises.
China-Russia Economic Times
A number of issues were discussed during the course of the Forum. Both sides agreed that there was a need to accelerate bilateral economic ties. Trade has witnessed a significant rise in recent years, while in 2017 it was estimated at over $80 billion. In 2018, bilateral trade could surpass $100 billion. Chinese investments in Russia have also been increasing. According to the Russia-China Investment Fund (RCIF; set up in 2012), 150 representatives from China and Russia have already identified 73 projects estimated at $100 billion. Also according to the RCIF, 7 projects estimated at well over $4 billion have already been undertaken.
Both sides also agreed to promote stronger synergies between the Belt and Road Initiative (BRI) and the Eurasian Economic Union (EEU).
Given the fact that the Forum was held in Russia’s Far Eastern Region (RFE), the need to increase Chinese investment in the RFE was high on the agenda. President Xi stated that China has always been a key participant in development projects in the Eastern parts of Russia. China’s Shandong Hi-Speed Group is also likely to invest in highway projects in the RFE.
Recent years have witnessed an increasing Chinese economic presence in Khabarovsk, which is the second largest city in the Eastern Region and 800 kilometres from Vladivostok. It may also be pertinent to point out that a large number of Russians have been uncomfortable with the growing Chinese economic clout, as well as immigrants. In 2010, the Chinese population in the Russian Far East was estimated at less than 30,000, though according to some estimates the population is much higher.
Both Russia and China warned against growing economic protectionism. Xi stated that he was all for greater international cooperation, and even lashed out at the growing tendency towards protectionism. Xi’s views were echoed by Putin, who stated that ‘the world and global economy are coming up against new forms of protectionism today with different kinds of barriers which are increasing.’
Putin made the point that protectionism was a threat, especially to Asia-Pacific (significantly, the current Trump administration has been using the term ‘Indo-Pacific,’ much to the chagrin of the Chinese).
What was also significant was that Xi came down heavily on ‘unilateralism’ at a time when China itself is being accused of ‘expansionist tendencies’ and promoting ‘Debt Trap Diplomacy.’ What was even more interesting was a reference to ‘UN Charter.’
The message emanating from the forum was clear: that the economic as well as strategic partnership between Moscow and Beijing is likely to strengthen, and both will try to develop an alternative narrative to that currently emerging from Washington.
Significance of meeting: Why India would be watching
New Delhi would be observing the Forum and meetings between Putin and Xi, since it’s own relations between Russia and China are of vital importance. While Russia is important in the security context, economic ties with Beijing are important for New Delhi.
New Delhi attaches immense significance to ties with Moscow
There are many in analysts in New Delhi who argue that India should be cautious in strengthening strategic ties with the US, given that this could cause friction in New Delhi’s relations with Moscow (Russia’s improved defense ties with Pakistan are often cited as a consequence of New Delhi moving too close to Washington DC). There are others who argue that New Delhi’s ties with Moscow are robust and time-tested, and will not be impacted by close ties with Washington DC. Russian President Vladimir Putin will be visiting India in October 2018 (for the 19th annual India-Russia Summit), while Indian External Affairs Minister Sushma Swaraj, during her Moscow visit, met with Deputy Prime Minister Yuri Borisov. Both of them jointly chaired the 23rd India-Russia Inter-Governmental Commission on Trade, Economic, Scientific, Technical, and Cultural Cooperation (IRIGC-TEC) meeting. A number of issues, including the need to boost bilateral trade and enhance people-to-people contact, were discussed. Significantly, this was Swaraj’s third visit to Russia in 11 months and she stated that India accorded ‘high priority’ to ties with Russia.
The fact that Swaraj’s visit to Russia took place after a successful 2+2 dialogue with the US, where a number of important defense agreements including COMCASA were signed, shows that New Delhi realizes the importance of ties with Russia. India is likely to sign a deal with Russia for the procurement of the S-400 air defence system, even though the USA has not given India any assurances with regard to a waiver from CAATSA (Countering America’s Adversaries through Sanctions Act) if India purchases defence equipment from Russia. During the visit, India is also likely to go ahead with an agreement with Russia for four frigates for the Indian Navy. While two of these will be manufactured in Kaliningrad, two will be manufactured in Goa.
New Delhi-Beijing ties
The issue of trade tariffs, which was highlighted by Putin and Xi, has also not gone unnoticed by New Delhi. One of the reasons (apart from the desire for peace and tranquility on borders) why India has been pro-actively reaching out to China is a convergence on economic issues. In fact, days after the 2+2 Summit, US President Trump, while referring to India and China, stated that the US has been providing subsidies to India and China for far too long and can not afford to do so any longer.
In terms of investments, there has not been much progress so far due to political disputes, but there is scope for greater economic cooperation between both countries through enhanced connectivity. New Delhi, on its part, should be open to projects like BCIM Corridor (Bangladesh, China, India, Myanmar). The recent proposal out of Beijing to start a railway line from Kunming to Kolkata may not seem possible in the short run, but in the long run it is definitely worth examining, and would give a boost to economies of India’s Eastern and North Eastern states. Interestingly, on September 9th, 2018, Myanmar signed a memorandum of understanding (MoU) with China for agreeing to establish the China-Myanmar Economic Corridor (CMEC). New Delhi should see this connectivity project as an opportunity rather than an obstacle.
New Delhi, while enhancing strategic cooperation with Washington, needs to keep in mind that there is a plethora of economic as well as other issues of global importance where New Delhi can find common ground with Beijing and Moscow. India bilaterally shares robust economic ties with China, and a strategic relationship with Russia. All three countries are also working closely in BRICS as well as SCO. New Delhi also needs to keep in mind that while strategic ties with Washington are important, Trump’s unpredictability will compel New Delhi to keep all its options open and think in a nuanced manner. While historically New Delhi shares close ties with Moscow, the logic of geography can not be ignored in the context of India-China ties.
Abdul Razak Dawood, Prime Minister Imran Khan’s Adviser on Commerce, Textile, Industry & Production and Investment, told the Financial Times that the previous Pakistan Muslim League (Nawaz ) government did not get a good deal for Pakistan in CPEC (China Pakistan Economic Corridor), and that Pakistan has lost out as a result of poor negotiations.
Dawood also made the point that some of the CPEC projects could be put on hold for a year, and CPEC can be stretched up to five years. Said Dawood: ‘Perhaps we can stretch CPEC out over another five years or so.’
Interestingly, during Chinese Foreign Minister Wang Yi’s recent Pakistan visit, Pakistan’s Foreign Minister, Shah Mehmood Qureshi, assured the former that Pakistan would accord high priority to CPEC — which was of immense economic and strategic importance for Pakistan. Qureshi also stated that projects would be implemented at the earliest outset. Even the normally outspoken Pakistan Finance Minister, Asad Umar, was cautious, and categorically said that ‘We don’t intend to handle this process like Mahathir.’ Imran Khan also met with Wang Yi, and a statement from the Pakistani side read as follows:
‘The Prime Minister reiterated that the Government is committed to the implementation of the CPEC.’
Wang Yi on his part emphasized on the fact that CPEC was not responsible for Pakistan’s debts. He also stated that Beijing was willing to re-negotiate a Free Trade Agreement which, according to many in Pakistan, was heavily skewed in favour of China and has faced domestic opposition.
During the course of a meeting between the Planning, Development and Reforms Commission of Pakistan and the National Development and Reforms Commission (NDRC) of China, two interesting aspects were added to the existing agreement. The first, that third countries would be allowed to invest in the upcoming 9 Special Economic Zones (SEZs) of CPEC. The Chinese delegation during the meeting is supposed to have conveyed the point that it was open to investment from countries which were friendly to both Pakistan and China to invest in the SEZs. Some of the potential countries discussed were Turkey, Russia, and Saudi Arabia
Second, ‘social sector’ schemes and regional development schemes were added to the existing CPEC projects. Social sector schemes include drinking water, health, education, and technical training. The inclusion of these areas was done keeping in mind the priorities of the current government.
Is a significant re-think towards CPEC possible?
There is no doubt that Islamabad’s dependence upon China would have increased as a consequence of its current economic situation and it’s deteriorating ties with Washington (days before US Secretary of State Mike Pompeo landed in Islamabad, military aid to the tune of $300 million was withdrawn). Yet, some re-think vis-à-vis CPEC can not be ruled out because a number of Pakistani politicians have expressed discomfort with the lack of transparency regarding the project.
Transparency with regard to the CPEC project
When in opposition, Imran had himself spoken about the need for greater transparency and openness with regard to the project. Before the elections in July 2018, many analysts argued that the Chinese would be far more comfortable with parties like the PPP and the PML-N as opposed to Imran Khan.
The protests of Khan and his party (PTI) against the previous PML-N government were also viewed with skepticism by the Chinese who believed that these protests would be detrimental to the progress of the project. Khan during his meeting, in 2016, with the Chinese Envoy to Pakistan tried to address the apprehensions of the Chinese by saying he was all for the project.
One of the objections of Pakistani politicians from Non-Punjabi provinces (across parties), as well as analysts, was that the project was Punjab Centric. In November 2017, members from the Senate, including the then-ruling party, PML-N, had spoken about the lack of transparency of CPEC, and had also alluded to the fact that China was benefitting at Pakistan’s expense.
Apart from domestic politics, the firm stance taken by Malaysian Prime Minister Mahathir Mohammad with regard to some Chinese projects (the Malaysian PM scrapped projects worth $20 billion) is also important and has forced a rethink in Pakistan . An editorial in Dawn titled ‘Rearranging CPEC’ also cited Mahathir’s stance against Chinese projects. While it is unlikely that Pakistan may follow suit as was stated by the Finance Minister, Asad Umar, as well as by Abdul Razak Dawood himself (Dawood in fact had to clarify that his remarks with regard to CPEC had been quoted out of context), there will be groups in Pakistan (especially members of the business community) who could nudge the current government towards tweaking the CPEC agreement further as well as resetting the Pakistan-China economic relationship to some extent.
China itself can not afford to ignore Mahathir’s stance, as well as his statement about the rise of a ‘new colonialism’. The address of Chinese President Xi Jinping at the Africa-China Summit, as well as Wang Yi’s statements during his Pakistan visit, are clear indicators that China is not taking Mahathir’s statements lightly. Whether Imran Khan can be a Mahathir of course is a different issue.
Lack of options and GHQ
While there may be certain personalities within the current government who are making the right noises with regard to the CPEC project, Islamabad’s economic situation has reduced its options.
Apart from this, the Pakistan army (which runs the show when it comes to complex foreign policy issues) has robust ties with Beijing, and will prevent any drastic changes to the CPEC agreement. During his meeting with Wang Yi, Pakistan’s Chief of Army Staff, General Qamar Javed Bajwa, assured the visiting Chinese Minister of full support. The Chinese also had a robust relationship with former Pakistan Army Chief, Raheel Sharif.
A re-think on CPEC, as well as Pakistan-China economic relations (highly unlikely in the short run), would benefit not just Pakistan, but could have broader ramifications, and may compel more countries to rethink their ties with China.
Mahathir Mohammad deserves credit for highlighting the shortcoming of China’s infrastructural projects as well as its economic ties with certain countries. This debate is not likely to die down soon, though not every country is in a position to take a bold stand like Mahathir. Imran Khan, in private, may be supporting Mahathir’s approach towards China, but can not afford to do so publicly.
My latest at RealClearHistory is up. An excerpt:
The Americans did not like this proposal one bit, and they went around the French and their Spanish allies and negotiated a separate treaty with the British, who were all too happy to give up some land in exchange for sticking a thumb in France’s eye. The French foreign minister at the time of the treaty negotiations, Charles Gravier, Count of Vergennes, bitterly complained that “the English buy peace rather than make it.” London also anticipated a rapprochement between itself and its now-former colonies, and a favorable treaty with the rebels would buy the British some much-needed diplomatic capital down the road. The American diplomats who negotiated such a generous truce were led by Benjamin Franklin, John Jay, and John Adams.
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My weekend column for RealClearHistory, in case you missed it, was fun to write. An excerpt:
4. The Mughals versus the Persians (1600s -1739). The Mughal Empire, an Indian polity that ruled over much of the subcontinent, fought three wars against two Persian dynasties (Safavids and Afsharids) and lost all of them. Much of the fighting was done around the city of Kandahar, in what is now Afghanistan. Kandahar was for a long time an important fortress for empires and dynasties that lorded over both Persia and India. While the Mughals had their pride stung by the losses, they could at least find solace in the fact their realm was the most economically successful on the planet at the time. India and Iran have long been weary regional rivals and sometime allies, but geographic distance and terrain have made outright wars between the two civilizations rare and limited. The rivalry between Iran and India has been a cultural one rather than a military one.
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Mike Pompeo’s recent speech (titled ‘America’s Indo-Pacific Economic Vision’) at the Indo-Pacific Business Forum hosted by the US Chamber of Commerce in Washington, DC, has been carefully observed across Asia. Beijing has understandably paid close special attention to it. Pompeo emphasized the need for greater connectivity within the Indo-Pacific, while also highlighting the role which the US was likely to play (including financial investments to the tune of $113 million in areas like infrastructure, energy, and digital economy). The US Secretary of State, while stating that this vision was not targeted at anyone, did make references to China’s hegemonic tendencies, as well as the lacunae of Chinese connectivity projects (especially the economic dimension).
The Chinese reaction to Pompeo’s speech was interesting. Senior Chinese government officials were initially dismissive of the speech, saying that such ideas have been spoken in the past, but produced no tangible results.
A response article in the Global Times is significant here. Titled ‘Indo-Pacific strategy more a geopolitical military alliance’ and published in the communist state’s premier English-language mouthpiece, what emerges clearly from this article is that Beijing is not taking the ‘Indo-Pacific vision’ lightly, and neither does it rule out the possibility of collaboration. The article is unequivocal, though, in expressing its skepticism with regard to the geopolitical aspect of the Indo-Pacific vision. Argues the article:
[…] the geopolitical connotation of the strategy may lead to regional tensions and conflicts and thus put countries in the region on alert.
The piece is optimistic with regard to the geo-economic dimension, saying that American investment would be beneficial and would promote economic growth and prosperity. What must be noted is that while the US vision for an ‘Indo-Pacific’ has been put forward as a counter to the Belt and Road Initiative (BRI) of China, the article also spoke about the possible complementarities between the US vision for an ‘Indo-Pacific’ and China’s version of BRI. While Pompeo had spoken about a crucial role for US private companies in his speech, the article clearly bats in favor of cooperation between the Indian, Japanese, Chinese, and US governments, rather than just private companies. This is interesting, given the fact that China had gone to the extent of dubbing the Indo-Pacific vision as “the foam on the sea […] that gets attention but will soon dissipate.”
While there is absolutely no doubt that there is immense scope for synergies between the Indo-Pacific vision and BRI, especially in the economic sphere, China’s recent openness towards the Indo-Pacific vision needs to be viewed in the following context.
First, the growing resentment against the economic implications of some BRI projects. In South Asia, Sri Lanka is a classical example of China’s debt trap diplomacy, where Beijing provides loans at high interest rates (China has taken over the strategic Hambantota Project, since Sri Lanka has been unable to pay Beijing the whopping $13 billion). Even in the ASEAN grouping, countries are beginning to question the feasibility of BRI projects. Malaysia, which shares close economic ties with Beijing, is reviewing certain Chinese projects (this was one of the first steps undertaken by Mahathir Mohammad after taking over the reigns as Prime Minister of Malaysia).
Secondly, the Indo-Pacific vision has long been dubbed as a mere ‘expression’ that lacks gravitas in the economic context (and even now $113 million is not sufficient). Developments over recent months, including the recent speech by Pompeo, indicate that the American Department of State seems to be keen to dispel this notion that the Indo-Pacific narrative is bereft of substance. Here it would be pertinent to point out that Pompeo’s speech was followed by an Asia visit to Indonesia, Malaysia, and Singapore.
The US needs to walk the course and, apart from investing, it needs to think of involving more countries, including Taiwan and more South Asian countries like Sri Lanka and Bangladesh in the Indo-Pacific partnership.
The Indo-Pacific also speaks in favor of democracy as well as greater integration, but countries are becoming more inward-looking, and their stands on democracy and human rights are more ambiguous than in the past. Japan is trying to change its attitude towards immigration, and is at the forefront of promoting integration and connectivity within the Indo-Pacific. Neither the US, nor India, Japan, or Australia have criticized China for its human rights violations against the Uighur minority in Xinjiang province.
Here it would also be important to state that there is scope for China to be part of the Indo-Pacific, but it needs to look at certain projects beyond the rubric of the BRI. A perfect instance is the Bangladesh, China, India, Myanmar (BCIM) Corridor, which India was willing to join, but China now considers this project as a part of BRI.
In conclusion, Beijing can not be excluded from the ‘Indo-Pacific’ narrative, but it cannot expect to be part of the same, on its own terms. It is also important for countries like the United States and India to speak up more forcefully on key issues pertaining to freedom of speech and diversity (and ensure that these remain robust in their own respective countries), given that one of the objectives of the Indo-Pacific vision is a ‘Free and Open Indo-Pacific’.