In Central Asia, China’s New Silk Road stirs memories of over-reach and entanglement

By Raffaello Pantucci

Registan

First published in The Interpreter, February 10 2016

Once the heart of the Timurid Empire, the city of Samarkand now sits in the middle of Uzbekistan, relegated to a splendid tourist attraction. Sitting atop the city with a clear view in every direction is the great astronomer Ulugh Beg’s observatory, from where he mapped the stars while his grandfather’s empire ebbed away.

Samarkand was at the heart of the ancient silk trading routes, which went cleanly around Russia, crossing Central Asia, Afghanistan and Iran to reach Turkey and Europe’s shores. Track forwards to today, and this straightforward route across the continent is being replicated by China. The first freight train left from Yiwu in China’s Zhejiang province en route to Tehran in the wake of President Xi Jinping’s recent visit to Iran.

Beijing, it seems, has the ancient silk routes in mind.
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Communication, Co-operation and Challenges: A Roadmap for Sino–Indian Engagement in Afghanistan

By Shisheng Hu, Raffaello Pantucci, Ravi Sawhney and Emily Winterbotham

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First published by RUSI, February 4, 2016

The politics of Afghanistan remain precarious. But if undertaken correctly, regional engagement by China and India can play a positive role in consolidating security and the economy

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Communication, Co-operation and Challenges: A Roadmap for Sino–Indian Engagement in Afghanistan concludes a research project which brought together influential thinkers and experts from China, India, Pakistan, the UK and Afghanistan in a number of workshops in London, Beijing, New Delhi and Qatar, and outlines areas of common interest between China and India in Afghanistan. The project spanned several years, starting in 2012. While participants’ opinions and responses were therefore likely influenced by developments in Afghanistan at the time the workshops were held it is, however, still possible to draw out the key commonalities and divergences between each country’s participants to map out policy ideas for co-operation and ‘burden-sharing’ between India and China in Afghanistan.

Both China and India have unique and strong relationships with Afghanistan and, in addition to co-operative efforts, both countries can play a number of bilateral roles. This paper presents some ideas for thinkers and strategists in Kabul, Beijing and New Delhi on how to help Afghanistan move forward and achieve stability.

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How China’s Power Runs Through a Peaceful Afghanistan

By Raffaello Pantucci

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First published by RUSI, February 2, 2016

China is playing a positive role in Afghanistan, but needs to take a greater ownership and direction of the potential peace process. As a partner with positive relations in both Kabul and Islamabad, Beijing is well placed to play this role.

The latest round of the Quadrilateral Group (Afghanistan, China, Pakistan and the USA) is being held in Islamabad this week. This round builds on an effort instigated by Beijing earlier in 2015 and has been one of the hallmarks of Afghan President Ghani’s presidency. The question, however, is whether China has the power to be a decisive player in Afghanistan that it has been increasingly hinting at with its role in these talks.

China has long been playing a productive role in the country. Whilst Beijing maintains awkward relations with Washington across the Pacific Ocean, on land, it is undertaking joint training programmes with the United States for Afghan diplomats and officials. It has helped facilitate discussions between Afghanistan and Pakistan and has helped soothe relations between Islamabad and Delhi. Most significant, however, has been the official diplomatic track that it has helped open between the government in Kabul and the Taliban. Though unofficial contacts existed previously, President Ghani’s ascent to power in September 2014 gave the relationship renewed impetus. This included a focus on a key role for China in the Afghan peace process, a point highlighted by Ghani’s first formal overseas trip being to Beijing.

This was not the first time discussions between the government in Kabul and the Taliban had been mooted. Previous dialogue tracks through institutes like Pugwash, in Chantilly, France or through the Taliban Doha office had not appeared move very far forwards with little evidence that the Taliban were taking the negotiations seriously. In contrast, the track opened with Beijing’s support appeared to draw its influence directly from the heart of the Taliban in Pakistan. Consequently, there appeared to be greater confidence that those talking were able to deliver what they were discussing. This was a key aspect to make the talks genuinely useful.
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The Economics of the Silk Road Economic Belt

By Sarah Lain and Raffaello Pantucci

First published by RUSI on November 27, 2015

On 20 October 2015, RUSI held a day-long workshop in Almaty, Kazakhstan, in collaboration with KIMEP University and the Friedrich Ebert Stiftung (FES). The focus of the workshop was the economics behind the Chinese Silk Road Economic Belt (SREB) and its impact in Central Asia. The key areas of discussion examined the potential benefits that the SREB could bring to participating countries, the integration of the SREB with other economic projects and the various funding mechanisms through which the SREB will be financed. The workshop brought together participants from Almaty, Astana, London, Beijing, Shanghai, New Delhi and Russia, including representatives from academia, the private sector and think tanks.

The first session discussed the real benefits of the SREB to both China and participating countries along the road. There is a risk that the SREB will simply turn Eurasia into a set of transport routes emanating from China, aimed at increasing the volume of Chinese goods going to Europe. Other than transit fees, China has not made it explicitly clear as to what other value participating in the SREB can add to economic development. Special economic and free-trade zones are one opportunity, such as that of Khorgos on the border of Kazakhstan and China, or those planned for Pakistan. However, the extent to which these are benefitting Central Asia is still unclear, and those for Pakistan are still under discussion. Kazakhstan’s side of this free-trade zone is noticeably less developed than that of China’s, highlighting that not all of these projects are implemented to meet maximum potential.

Furthermore, China’s emphasis on connectivity as a key goal of the SREB runs the risk of over-emphasising railway development as an end goal, since not all goods are cost-effective to transport by rail. High-value goods are the ideal product: one participant from Kazakhstan noted that Kazakhstan Temir Zholy, the national railway operator, had begun transporting Apple products from China, cutting down delivery time from sixty days (by sea) to eighteen days (by rail). For the SREB project to be successful, therefore, both Xinjiang, the northwestern Chinese province, and the countries along the Silk Road route need to increase their high-tech manufacturing capacity to produce these high-value goods for transport, neither of which are currently visible.
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China And Russia: Locked In Reluctant Embrace

By Raffaello Pantucci

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First published in China Economic Quarterly, November 2015

The dynamic of the Sino-Russian relationship is one that has long perplexed Western decision makers and thinkers. At a geopolitical level they appear in lockstep in an anti-western front, but below the surface they seem willing to engage with the west against each other’s interests while also sharing some fundamental disagreements. The reality is that Moscow and Beijing have a sophisticated modus vivendi that both allows for a clear disparity in the relationship in Beijing’s favor, while at the same time retaining an equal sense of importance of the broader strategic relationship. The overriding priority for both remains to ensure that they have an ally against the West and as long as this need remains the axis of authoritarianism will persist.

The archetypal space to explore this complex divergence is Central Asia. On the one hand it is a region where China has gradually increased its footprint to become the most consequential actor on the ground, while on the other it remains linked inextricably to Russia through multilateral vehicles and long-standing ties. And while in other parts of Eastern Europe or the Caucasus Russia has reacted negatively to encroaching external influences with armed conflict (like Georgia or Ukraine), in Central Asia the slow creep of Beijing’s influence has happened largely with Moscow’s acquiescence, though not without some counter-reaction.
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How China rediscovered Central Asia

Xi Jinping Central Asia

By Tao Xie

From 1949 until the late 1990′s Central Asia was conspicuous in Chinese foreign policy by its absence. China has since “rediscovered” Central Asia. Twice.

China first rediscovered the five Central Asian republics as a crucial source of energy and the key partner in fighting against separatists in North-west China. In the first decade of the 21st century, bilateral trade—primarily in the form of Chinese imports of energy and exports of manufactured products—witnessed extraordinary growth, reaching $51.1 billion in 2013. Meanwhile, the Shanghai Cooperation Organization was established in 2001, and one of its main missions continues to be to “maintain and ensure peace, security and stability in the region”. Continue reading

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Connecting the Eurasian Economic Union and the Silk Road Economic Belt: Current Problems and Challenges for Russia

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By Ivan Zuenko

During the Putin-Xi summit that took place in Moscow on May 8, the leaders of Russia and China signed a joint declaration “on cooperation in coordinating the development of the Eurasian Economic Union (EEU) project and the Silk Road Economic Belt (SREB)”. Moscow and Beijing’s declared goal in combining the two projects was to build a “common economic space” in Eurasia, including a Free Trade Agreement between the EEU and China.

The positive implications of such a connection are obvious. Cooperating with China can provide Russia and other post-Soviet countries with much-needed funding and technologies for the implementation of large-scale infrastructure projects, primarily in the sphere of transcontinental logistics. It is this auspicious aspect of the EEU-SREB merger that has attracted the most attention in academic papers published by experts. Continue reading

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Silk Road: China’s project could transform Eurasia

Photo: Thomas Depenbusch
Photo: Thomas Depenbusch

By Raffaello Pantucci and Sarah Lain

First published in the EU Observer, October 2015

Almost two years have passed since Chinese President Xi Jinping first gave a name to the strategy that China had been undertaking in Central Asia for over a decade. The announcement of the Silk Road Economic Belt in Astana in September 2013 was rapidly followed by the declaration of a number of other trade and economic corridors emanating out from China, which largely copied the Central Asian model.

At home in China there has been a flurry of activity to try to unpack at a regional and national level the roadmap of the leader’s vision, manifested in conferences, regional strategy documents, and various declarations.
Outside China there has been less clarity, with most in Europe (who have heard the message that they are the other end of this road) questioning what the Chinese vision looks like in practice. Continue reading

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China and Russia’s Soft Competition in Central Asia

By Raffaello Pantucci

First published in Current History, October 2015

China and Russia have a long history of conflict and competition in Central Asia. Sitting between the two great superpowers, the landlocked Central Asian nations appear to have little choice or control over their destiny, and are often considered to be pawns in a perpetual great game. Yet this narrow view misses the broader picture of the Sino-Russian relationship. It is undeniable that the region has been slipping out of Russia’s immediate economic sphere of influence for some time, but China has been making inroads with Russia’s full acquiescence. For Moscow and Beijing, Central Asia is increasingly a region of soft competition where they are very aware of and attentive to each other’s interests, rather than a source of conflict and tension.

Overriding any differences concerning the steppe are the larger realities of the Sino-Russian strategic relationship on the international stage, where the two permanent members of the United Nations Security Council continue to support each other’s refusal to bow to a Western-dominated global order. Russia may appear to be the loser in Central Asia, but the two powers have established a modus vivendi that suits the interests of both. The real geopolitical losers are likely to be the Central Asians, slowly slipping from Russia’s orbit into China’s.

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Can China Assert Itself in Afghanistan?

by Raffaello Pantucci and Kane Luo

First published in The Diplomat, August 28, 2015

Ghani Xi signing

Confirmation of Mullah Omar’s death has confused an already difficult picture in Afghanistan. Precarious relations between Afghanistan and Pakistan have been pushed even closer to breaking point, and the one bright spot, that of increased regional support, seems to have slipped onto the back burner. Beijing in particular needs to wake up and play a stronger leadership role in Afghanistan.

Afghan President Ashraf Ghani attended the Shanghai Cooperation Organization (SCO) Summit in Ufa with high hopes of again bringing the support of regional powers to bear on helping resolve his country’s ongoing civil war and the growing emergence of ISIS related terrorism within his country. On the face of it, the SCO would appear to be a very promising lead. Now expanding to include both India and Pakistan, the multilateral organization is one that manages to bring together almost all of the regional elements that are likely to be needed if we are to see a genuine local push to resolve Afghanistan’s problems. Its security architecture further offers a set of existing regional structures to discuss and implement some sort of regional response to Afghanistan’s perennial security threats. But thus far the organization has singularly failed to deliver much in terms of action on Afghanistan. The reality is that the real driver of a regional shift on Afghanistan is going to come from Beijing.
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Russia gives way to China in BRICS and SCO

By Sarah Lain

First published in The Interpreter, July 17 2015

Ufa Summits

This month saw a super summit of two organisations that are significant for both Russia and China. The 7th BRICS summit and 15th Shanghai Cooperation Organisation (SCO) summit, both held in Ufa, Russia, included the typical member-state declarations confirming cooperation on major issues such as counter-terrorism, ensuring stability and enhancing global economic development.

There were also strong indications, however, that these multilateral organisations are fast becoming platforms for China to promote its own projects, namely the Silk Road Economic Belt. Announced by President Xi Jinping at Nazarbaev University in 2013, the Silk Road is a key foreign policy vision for Beijing aimed at enhancing global trade, connectivity, financial integration and cultural understanding.

Although so far the project seems more of an umbrella term for large Chinese-funded energy and infrastructure projects in Central and South Asia, it has become a centrepiece of China’s bilateral and multilateral relations and discussions. The growing references within the SCO on how it can participate in, and facilitate, the development of China’s Silk Road Economic Belt initiative are subtly eroding Russia’s position.
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Russia holds the door to Central Asia open for China

By Raffaello Pantucci

First published in the South China Morning Post, July 15 2015

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Late last week, the leaders of almost half the world’s population gathered in Ufa, Russia. The collision of the BRICS and Shanghai Cooperation Organisation (SCO) summits was orchestrated by Russia to guarantee exposure and attention, and highlight to the world how many friends Russia has. Dig below the shallow surface, however, and the links between the countries of the two international organisations are barely skin deep, with everyone attending for their own reasons.

For China, the two summits provide another opportunity for global engagement, as well as helping Beijing advance two international financial institutions. A timid player in many ways on the international stage, Beijing has found that its capital is one lever that it can use without raising too many hackles, and the meetings in Ufa gave it another opportunity to flex these financial muscles.
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India and SCO: the real benefit

By Raffaello Pantucci

First published in Gateway House, July 9 2015

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India’s path to membership of the Shanghai Cooperation Organization (SCO) now seems certain. It is not clear that the Ufa Summit will conclude with the organization admitting both Pakistan and India, but the next step in membership will be taken with Delhi formally being admitted into the SCO structures next year.

But what will this new membership actually mean for India?

The short answer: not much.

An often misunderstood and overblown entity, the SCO was founded in 2001 and evolved from a grouping born out of the end of the Cold War to define China’s western borders. Over time, the grouping discovered a common set of interests in countering terrorism, agreeing broadly on what constitutes terrorist activity and then developed structures to try to counter it collectively.

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The geopolitical roadblocks

By Raffaello Pantucci and Qingzhen Chen

First published in China Analysis, June 10 2015

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Sources:

Zhang Yunling, “Analysis says One Belt One Road Faces Five Challenges,” Xiaotang Caizhi, 23 March 2015.

Tang Yiru, “Where does the money come from for the One Belt One Road? Geopolitical risks cannot be ignored,” Guoji Jinrong Bao, 9 February 2015.

Hu Zhiyong, “How to understand the political risks of ‘One Belt One Road’”, Aisixiang, 2 March 2015.

Jia Qingguo, “A number of issues that the OBOR urgently needs to clarify and prove,” Aisixiang, 24 March 2015.

Ge Jianxiong, “The History of One Belt One Road is misunderstood,” Financial Times (Chinese version), 10 March 2015.

Pang Zhongying, “One of the resistances to the One Belt One Road is from India,” Aisixiang, 4 March 2015.

Chinese authorities – and authors – describe China’s “One Belt, One Road” (一带一路, yidai yilu, hereafter OBOR) strategy as one of the most important foreign policy initiatives in the twenty-first century, and Chinese authors agree. Across the country (and, increasingly, across the world), Chinese universities and research institutions are conducting projects to explore how the vision might be implemented. Meanwhile, China’s leadership is offering economic incentives to help make the vision a reality, either through bilateral connections or through the new constellation of multilateral international financial institutions that China is developing. However, the Chinese comments also reflect that the strategy will have to overcome many challenges. Is Chinese business ready to go global? Are the countries along the routes ready to embrace the initiative? How much does China know about the countries involved and about how they will be changed by Chinese investment? And is China properly prepared to implement this strategy?
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Untangling the web of India, China and Pakistan diplomacy

By Raffaello Pantucci

First published by Reuters, May 25 2015

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On the eve of Prime Minister Narendra Modi’s visit to China, Xinhua published a rare opinion piece by his Pakistani counterpart Nawaz Sharif. The obvious choreography of the visit and article shows the delicate balance in relations between China, India and Pakistan.

For Beijing, both powers are important if it is to realize its ambitious strategy of trade and economic corridors emanating from the Middle Kingdom under the rubric of the Silk Road Economic Belt. For current governments in Islamabad and New Delhi, Beijing’s economic miracle offers a way of helping develop their economies. Yet we are some way off before this trilateral relationship will be able to live up to its potential as the economic powerhouse at the centre of Asia.
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