Friday, July 3, 2015

Thoughts on India’s Central Asia Strategy

Amb Rajiv Sikri, 
Distinguished Fellow, VIF

It is indeed encouraging that in a few days Prime Minister Modi will be visiting all the Central Asian countries simultaneously, something that no Indian Prime Minister has done so far. However, India seems to be grappling with the same issues and dilemmas in relation to Central Asia that were present in the nineties, notwithstanding periodic efforts to kick-start the relationship. Why is this so? There are both objective constraints, as well as some missed opportunities.

If it is to have an enduring impact, Prime Minister Modi’s visit will have to go beyond promoting goodwill and the usual bilateral agreements and discussions. He must go with a clear strategic perspective of India’s relations with the Central Asian countries; without that, it won’t be possible to develop a viable Central Asia policy. India’s relations with the Central Asian Republics (CARs) must take into account developments in the wider Eurasian space that includes the five CARs, Afghanistan, Pakistan west of the Indus, Iran, Tibet, Xinjiang and Mongolia, and the Indian state of Jammu and Kashmir, including those regions currently occupied by Pakistan and China.

Throughout history, Eurasia has been a strategic not a mere geographic space. As a geographical area on to which the back doors, so to speak, of major Asian powers open, Eurasia has always attracted, and will continue to attract, the attention of outside powers. It is a ‘negative security space’, an area where major powers cannot afford to let competing major powers or forces exercise a dominating influence because that would pose a threat to their own security. The Cold War and the impermeable political borders of Eurasia during this period dulled strategic perceptions about this region, but that was a geo-strategic aberration.

For the last quarter century, Eurasia has been once again at the centre of global geopolitics. In the second half of the 19th century and the early 20th century, it was the setting for the ‘Great Game’ between imperial Britain and Tsarist Russia. A century later, the geostrategic imperatives remain unchanged, only the ‘game’ has become more complicated, with energy emerging as an additional factor in strategic calculations. Connectivity across Eurasia has dramatically improved. Roads, railway tracks as well as oil and gas pipelines and power transmission lines are criss-crossing the region. Of course, so are drug smugglers, terrorists and fundamentalists.

The CARs, both collectively and individually, are today much weaker than their geographically contiguous large neighbours like Russia and China. Between the two, Russia’s influence has declined while China’s has steadily increased in the CARs over the last quarter century. Since 9/11, the United States has also become an active player in the region. These three powers are the principal outside players. Other powers such as Europe, Japan, Turkey, Iran, Pakistan and India still play only marginal roles.

Russia is taking purposeful steps to regain its preponderant influence in the CARs. It has enmeshed most of them in regional security and military arrangements like the Collective Security Treaty Organization (CSTO) as well as through bilateral military agreements. A Russia-dominated Eurasian Economic Union including Kazakhstan and Kyrgyzstan has been set up; Tajikistan too may join it. Russia has many additional levers in Central Asia viz. a significant and influential Russian origin population; good networking; dependence of many CARs on remittances of migrants working in Russia; transit facilities for landlocked CARs; and considerable economic interdependence of CARs with Russia. While wanting to reduce the strong grip of Russia that held them for seven decades, the CARs realize that they can neither ignore nor do without Russia.

A rising China is systematically and relentlessly sucking the CARs into its economic whirlpool. Energy supplies for its fast-growing economy, a proximate market for its products, and a security buffer for Xinjiang – these are China’s main concerns vis-à-vis the CARs. Having taken over Xinjiang, it now seeks to dominate the CARs. This won’t be easy, since China faces many serious long-term challenges. Xinjiang, which has extensive ethnic, economic, social and other ties with the CARs could turn out to be China’s Achilles heel. Uighur nationalism remains strong. The fate of the Muslim Uighurs carries resonance among the Islamic ummah. Some Uighur elements appear to have developed linkages with the al-Qaeda, the Taliban and, more recently, the Islamic State too. Xinjiang’s security and stability could be compromised by turmoil or turbulence in the CARs. China realizes this – its latest Defence White Paper mentions the dangers from separatist forces fighting for “East Turkestan independence.” Moreover, despite benefiting from China’s economic growth the CARs remain wary of becoming economically too dependent on China, and worry about creeping Chinese demographic expansionism. Historically, China has been viewed by Central Asians as an expansionist and dominating power, and recent Chinese muscle flexing in Southeast Asia would have reinforced traditional suspicions about China’s attitude towards weak neighbours.

Capitalizing on the favourable climate after 9/11, the United States rushed to establish a number of bases in the region, which it has since had to vacate under the combined pressure of Russia and the CARs. While its other global preoccupations have reduced US interest in Central Asia under President Obama, US policy has always been to somehow detach the CARs from Russia’s sphere of influence and integrate them economically with Afghanistan and South Asia. The ongoing Russia-US standoff over Ukraine would have only reinforced US determination in this respect. Central Asians welcome the United States as a check on both China and Russia, but they realize the fickleness of US policies and level of interest, and remain wary of US proclivity to work for regime change and exert pressure on human rights issues.

Where does India fit into this picture? Over the centuries the most extensive connections of Central Asians with the outside world have been with India. Nor has India ever posed any ideological, demographic or territorial threat to Central Asia. Thus Central Asians have always had a romantic attraction towards India, reinforced by close and friendly relations during Soviet times. That is a good starting point, but nothing more. Today, at a general level, the CARs want a more active Indian presence to balance the other major players who carry considerable baggage. So far, however, the CARs and India haven’t been able to reconnect meaningfully principally because of the absence of easy and reliable connectivity. Since there does not appear to be any immediate solution to this problem, economic and people-to-people linkages between the CARs and India remain weak. Trade routes are long, cumbersome and uneconomical. The legal systems, regulatory and taxation provisions in the CARs leave much to be desired. There are other factors too why Indian private entrepreneurs find the CARs comparatively less attractive than many other places viz. poor air connectivity; difficulties in getting visas; unfamiliarity with local languages; and some bad experiences of Indian companies in the CARs in the early years after their independence. Perhaps economic relations will get a boost if India were to conclude a Free Trade Agreement with the Eurasian Economic Union. A study group has been recently set up to examine this proposal.

More than trade in goods, the two sides should focus on trade in services and use of the CARs as a transit point. Leveraging their location, the CARs could, however, become a passenger and cargo hub for air traffic from India to Siberia and the Russian Far East region in one direction, and to Europe in the other, in the way Dubai, Abu Dhabi, Doha and Singapore have positioned themselves. The CARs could also develop their potential as a tourism destination for Indians with competitive pricing, a more liberal visa regime and better air connectivity. There could even be joint marketing of Central Asia and north India to the rest of the world as a “Mughal Trail.

A blueprint for India-Central Asia cooperation was outlined in India’s ‘Connect Central Asia Policy’ three years ago. This needs to be fleshed out and implemented earnestly. One of the first things that India should do is to change its image in the CARs. Instead of the traditional stereotype of Soviet times, India should be projected as a modern, scientifically and technologically advanced country with capabilities that are relevant for the development of the CARs. Some of the concrete initiatives that could be pushed are: encouragement to private Indian airlines and charter flights to operate between India and Central Asia; significant expansion of existing programmes of technical cooperation so that more young people visit India to develop skills that are needed in their home countries; larger loans on soft terms for infrastructure projects. In return, India would very much like to gain access to the rich natural resources of the CARs and some specialized defence technologies and production facilities.

It must be emphasized, however, that India’s interests in Eurasia are fundamentally strategic. The CARs are superficially stable but inherently fragile states, with incomplete nation building, underdeveloped political institutions and traditions, no accepted mechanism for periodic transfer of political power, and economically still considerably tied to a beleaguered Russia. Weak and unstable states with centrifugal tendencies could become a haven for terrorists, separatists, drug dealers and fundamentalists, linked up with similar elements in Afghanistan, Pakistan and West Asia. India has a strong interest in seeing stable and secular CARs. This is a formidable challenge that will not be easily met without large-scale investments that promote economic development and reduce unemployment among the youth, thereby giving people long-term hope about a brighter future.

A stable Eurasia is in the interest of all countries of the region. However, the prospects of long-term stability and peace are bleak if the great powers indulge in a new zero-sum ‘Great Game’ in Eurasia. Wisdom lies in all countries adopting a cooperative rather than a competitive approach. The Shanghai Cooperation Organization (SCO) is potentially a promising vehicle for such cooperation. India hopes to join it as a full member, but this is not a given since the attitude of China remains ambivalent. Unfortunately, the SCO is China-dominated and China-driven. While full membership will certainly raise India’s profile in Central Asia, it is unlikely to help India achieve its core interests in Central Asia. China and Pakistan, both individually and jointly, seem determined to unilaterally pursue their perceived strategic interests in the region.

Apart from the CARs, developments in Xinjiang, geographically contiguous to both the CARs and India, have direct and far-reaching implications for India’s security. India needs to carefully study and anticipate various scenarios in Xinjiang. China’s strong strategic partnership with Pakistan, and physical connectivity via Xinjiang, has been reinforced by the ambitious China-Pakistan Economic Corridor project. The success of China’s Silk Route Economic Belt initiative will enable China to dominate the Central Asian Republics and Afghanistan (where it is making significant investments and is also trying to play a political role). If China were to emerge as the preponderant power in Eurasia, this would constitute a tectonic geopolitical shift that India, can countenance with equanimity, as this would significantly undermine India’s strategic interests and security.

Thus India’s approach to this region cannot be passive. India must strive to get a firm foothold in the Eurasian space, including Afghanistan, so that forces inimical or hostile to India’s interests like China and Pakistan do not dominate it, particularly if economic and other influence is backed by a military presence. In order to ensure its security, India has to exercise at least some degree of influence, if not control, over the trans-Himalayan strategic space in Eurasia. It must become relevant to the growth, development and prosperity of the CARs. For this to happen, it has to be involved in Eurasian energy politics. Small individual investments of the kind India has made in Kazakhstan are inadequate. What is needed is a big project that creates long-term mutually beneficial linkages of India and the CARs and, equally important, is in conformity with the strategic interest of the concerned parties.

In this context, Iran’s strategic relevance to India has gone up. Apart from other factors like Iran’s intrinsic importance as a major player in the Persian Gulf, and Iran’s rich oil and gas reserves, Iran is currently India’s only route to Afghanistan and the Central Asian Republics. India and Iran will also need to cooperate to try to stabilize Afghanistan. Already a formidable regional power, Iran’s role will only increase after a nuclear deal is clinched with the P-5+1. After submitting to US pressure over Iran for a decade, India is now repairing its disrupted ties with Iran. The recently signed Memorandum of Understanding on the development of Chabahar port, not merely as an economic but more so as a strategic project, and the reactivation of the North-South Corridor are long overdue and important concrete steps in this direction. These need to be followed up urgently with high-level exchanges, including at the Prime Minister’s level.

Since Russia, Turkmenistan, Iran and Qatar have about two-thirds of the world’s exportable surplus of natural gas, Eurasia should be at the centre of India’s gas import strategy. For all these countries too, India is a proximate and attractive long-term market. Russia can no longer count on the long-term loyalty and dependence of its traditional European customers, the more so after the Ukraine crisis. India is an important alternative market. Turkmenistan is already pushing the TAPI pipeline project to export its gas to India and Pakistan. As for Iran, it will definitely want to tap large gas markets like India once sanctions are removed, hopefully quite soon. Qatar’s future as a major gas exporter is linked with Iran, with which it shares the same principal gas field (South Pars/ North Dome). India already has energy investments in Russia and Kazakhstan and there is an agreement in principle with both countries to explore the possibility of energy pipeline projects to India. If the Central Asian countries work with Russia and Iran, Eurasia can be hard-wired with India in a web of interdependence. This has to be conceived and executed as a strategic project, not merely as an economic or energy deal.

India must try to persuade Russia, Kazakhstan, Turkmenistan and Iran to let India develop, or at least allocate to India, some large gas fields that can be a source of long-term gas supply to India. The greater challenge will lie in transporting Eurasian gas to India. The LNG route is too long and expensive, at least for now. Purely land routes from Eurasia to India pose many problems. Given the continuing lack of trust between India and Pakistan, and the uncertainties surrounding Afghanistan, it is doubtful if either the Turkmenistan-Afghanistan-Pakistan-India (TAPI) or the Iran-Pakistan-India (IPI) pipeline projects will actually fructify. Under these circumstances, the only feasible alternative is a land-cum-sea pipeline from Eurasia to India via the Iranian port of Chabahar.

One possible route is from western Siberia in Russia to Chabahar via west Kazakhstan and Turkmenistan. The advantage of this route is that it involves fewer countries and can also incorporate existing swap arrangements between Iran and Turkmenistan. Another route is from eastern Siberia in Russia to southeast Kazakhstan via the Altai region, on to Kyrgyzstan and Uzbekistan’s Ferghana Valley, thence west to Khojent in Tajikistan at the mouth of the Ferghana Valley, and thereafter into Afghanistan, along the Mazar-e-sharif – Herat – Delaram - Zaranj route (which is outside the Taliban’s area of influence) before entering eastern Iran and down south to Chabahar. The advantage of this route is that it would also serve Uzbekistan, Kyrgyzstan, Tajikistan and western Afghanistan, and thereby help to stabilize these countries. On the flip side, it would definitely be a more complicated project. Perhaps it might be better to start with the first option and then consider the eastern route later.

From Chabahar, there would be an undersea pipeline via Oman to ports in Gujarat. Two gas hubs would come up. One would be in Chabahar, fed by Russian, Turkmen and possibly also Kazakh gas from the north, together with Iran’s own gas from South Pars. Another hub would be in Oman where the gas piped from Chabahar under the sea would meet up with Qatar gas piped across the UAE. An Indian company, South Asia Gas Enterprise (SAGE), has done a study on the commercial and technical viability of such undersea pipelines between Iran/Oman and India, and is actively working with the concerned governments to take it forward.

One hopes that as Prime Minister Modi prepares to visit Central Asia, his Government and his advisers are looking at conceptualizing a major strategic project of the kind suggested above. If such a project were to be endorsed by the CARs during his visit, that would be a significant breakthrough in India’s floundering Central Asia policy.

Published Date: 2nd July 2015, Image Source: http://www.presstv.ir
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of the Vivekananda International Foundation)

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