Energy: The catalyst for
conflict By Chietigj Bajpaee
Numerous recent and seemingly unconnected
events have highlighted the emerging fulcrums of
potential alliances in Asia, as well as the
possible focal points of conflict.
First,
Chinese energy company CNOOC (China National
Offshore Oil Corporation) has failed in its bid to
acquire US energy company Unocal, even though it
made a higher bid and offered better terms than
its rival Chevron.
At the same time,
Indian Prime Minister Manmohan Singh during a
visit to the United States was given a grand
welcome and promised assistance on its civilian
nuclear power program, even though India is not a
signatory to the nuclear Non-Proliferation Treaty
(NPT) and was frowned on for its nuclear tests in
1998.
In other words, while the US stifles
China's attempts to meet its energy security needs
it has promised to assist India in meeting its
needs. It should be noted that had the
CNOOC-Unocal deal succeeded, a Chinese energy
company would now have its hands
on
energy
assets in close proximity to India. For example,
Unocal has significant operations in Myanmar
and Bangladesh, and in the 1990s it was involved
in negotiating the Trans-Afghan Pipeline (TAP)
from the gas fields of Turkmenistan through
Afghanistan to Pakistan. India has a significant
interest in these operations.
Second, at
the 60th anniversary of the end of World War II,
while the European powers held joint memorials,
the East Asian powers held separate memorials with
each country choosing selectively remembered
events. While Japan focused on the devastation of
the atomic bombs on Hiroshima and Nagasaki, China
focused on its humiliation by Japanese troops
during such events as the Nanjing Massacre.
Historical animosities have been further
enflamed by recent events. These include South
Korea and China's opposition to Japan's bid for a
permanent seat on the UN Security Council due to
visits by Japanese Prime Minister Junichiro Kozumi
to the Yasakuni Shrine and Japan's republishing of
a history textbook that whitewashes Japanese
wartime atrocities. Tensions have also been fueled
by a territorial dispute between South Korea and
Japan over the Takeshima/ Tokdo islets, and
between China and Japan over the demarcation of
the East China Sea.
Third, Russia and
China held unprecedented joint military exercises
this month. Entitled "Peace Mission 2005" and
comprising of 7,000 mainland troops and 1,800
Russian forces, the exercises have come under the
framework of the Shanghai Cooperation Organization
(SCO) with the intention to prepare for
intervention in a state overcome by ethnic
conflict. While claiming that the war games were
not targeted at any third party, they were held in
the Shandong peninsula and the Yellow Sea, in
close proximity to Japan, Taiwan and the Korean
peninsula.
The exercises included a naval
landing, which is unusual given that they come
under the SCO framework, which would imply
involvement in landlocked Central Asia.
Furthermore, the US was not invited to observe the
exercises although the four other SCO members
(Kazakhstan, Kyrgyzstan, Tajikistan and
Uzbekistan) along with SCO observer states, India,
Iran, Mongolia and Pakistan, were.
Growing
Sino-Russian military cooperation comes in the
context of China and Russia's confrontational
relations with Japan and the US. While Russia has
approved the construction of a Japanese-backed oil
pipeline from Taishet to the pacific port of
Nakhodka, it has hinted that it will build a
branch from the pipeline to Daqing in China's
northeast Heilongjiang province before completion
of the Japanese-backed route. This change of plan
has been fueled by Russia's growing frustration
with Japan's unwillingness to compromise on a
decades-old territorial dispute over the Southern
Kurils/ Northern Territories and Kozumi's
aggressive posturing, as seen with him sailing
around the disputed islands last
September.
Meanwhile, China and Russia
under the aegis of the SCO have also demanded that
the US set a deadline for withdrawing its bases
from Central Asia as the situation in Afghanistan
stabilizes. This comes in the context of growing
concern over the US-backed "colored" revolutions
in Georgia, Ukraine and Kyrgyzstan. Soon after the
SCO statement, Uzbek President Islam Karimov gave
the US 180 days to withdraw its forces from the
Karshi-Khanabad (K2) airbase. Unsurprisingly,
Uzbekistan's ultimatum followed its suppression of
the Andjian uprising in May, which the US and
other Western powers condemned and China and
Russia commended, as seen by Karimov's visit to
Beijing two weeks after the uprising.
Sino-US tensions have also flared over a
series of provocative statements by officials on
both sides. On the Chinese side, Major-General Zhu
Chenghu in a speech at the Hong Kong Foreign
Correspondents Club in mid-July stated that China
would initiate a nuclear first-strike on the US if
it were to intervene in a conflict over Taiwan.
Whether this statement was made in a
personal capacity as the Chinese government claims
or as an attempt by the central government to test
international reaction will only be verified in
the coming months when it is established if Zhu
has been censured or promoted for his statement.
On the US side, Secretary of Defense Donald
Rumsfeld has made numerous remarks warning of
China's growing military capability. Recently, he
stated that China's growing military expenditure
was out of step with its claims of "peaceful
emergence". This statement was made in the context
of a US Defense Department report last month,
which cited China's growing military modernization
as tilting the military balance in the Taiwan
Strait and undermining long-term stability in the
region. The US and Japan also issued a joint
statement in February, which identified the
Sino-Taiwan dispute as a mutual security concern.
Finally, South Korea is growing
increasingly estranged from Japan and the US due
to its softer approach in dealing with North
Korea's nuclear ambitions. This was seen recently
with Unification Minister Chang Dong-young stating
that Pyongyang had the right to a peaceful nuclear
energy program, while the top US negotiator at the
six-party talks, Christopher Hill, has stated that
light water reactors are unnecessary to meet the
North's energy needs. Seoul's increasingly
conciliatory stance with Pyongyang has been fueled
by a shift in power from the vehemently
anti-communist Grand National Party (GNP) to
President Roh Moo-hyun's ruling left-of center Uri
Party. Coupled with South Korea's attempts to
access energy resources in Russia and Central Asia
and the territorial dispute with Japan over the
Takeshima/ Tokdo islets, there are hints of a
shift in South Korea's international relations
from the US-Japanese camp towards the Sino-Russian
camp.
Players hedging their bets At present there are no clear alliances in
Asia. Instead, there are numerous permutations and
combinations of alliances that may be formed. All
sides are hedging their bets and preparing for
every possibility.
China and the US have
recently initiated a strategic dialogue and both
states along with India, Australia, Japan and
South Korea have established an energy partnership
known as the Asia-Pacific Partnership on Clean
Development. China has also played a vital role in
brokering the six-party talks on North Korea's
nuclear program, although its neutrality in the
dispute is questionable.
While Russia and
China have a strategic partnership in the military
sphere, both states still have stronger trade and
investment relations with the US than with each
other. Russia is also weary of the demographic
imbalances created by the encroachment of China's
population into its sparsely populated far eastern
territory. There are also limits on the level of
Sino-Russian military cooperation - while both
states may engage in joint intervention in Central
Asia, Russia is unlikely to intervene in a
conflict over Taiwan, just as China is unlikely to
get involved in Chechnya.
While US-India
relations have shown considerable improvement
under the Bush administration, India opposes US
unilateralism, including its policy on Iraq and
support for Pakistan's military dictatorship.
Meanwhile, the US opposes India's plans to
strengthen energy cooperation with Iran with a gas
pipeline from Iran to India traversing through
Pakistani territory.
Sino-Indian energy
cooperation has also increased, with both states
holding a stake in the development of the
Yahavaran oil field in Iran and the Greater Nile
Oil Project in Sudan, as well as China Gas
Holdings establishing an alliance with India's
largest energy conglomerate, GAIL (Gas Authority
of India Limited). Growing bilateral trade,
cooperation in the G33 bloc at the World Trade
Organization and China's recognition of Sikkim as
a part of India as quid pro quo for India's
recognition of Tibet as a part of China are
further evidence of a rapprochement in Sino-Indian
relations. Finally, India's observer status at the
SCO coupled with China and India's dependence on
Russian military hardware and energy resources
revive the idea of a strategic triangle between
India, China and Russia.
Some have even
hinted at a Sino-Japanese-Indian alliance - a sort
of grand Asian alliance. While unlikely given the
high level of mistrust between China and Japan, it
is not impossible given the unprecedented trade
and investment interdependence between the three
states - China is India and Japan's second largest
trading partner after the US.
Nevertheless, certain combinations are
more likely than others. In all likelihood, China
and Russia will grow closer as will Japan and the
US. Apart from disputes over Taiwan, China's
exchange rate, quotas on Chinese-made textiles,
intellectual property rights infringements and
China's human rights record, the US is growing
increasingly frustrated with China's relations
with dictatorial regimes, including Robert Mugabe
in Zimbabwe, King Gyandera in Nepal and Islam
Karimov in Uzbekistan, as well as support for
"rogue" or anti-US regimes such as Myanmar, Iran,
Sudan and Venezuela. Russia and China have also
opposed US unilateralism on the world stage.
India and South Korea are sitting on the
fence and could go either way depending on how
events play themselves out. For example, Chinese
support for Pakistani aggression could put India
on the side of the US against China, while
aggressive and unilateral military action by the
US could solidify an Asian alliance. The current
Sino-Indian rapprochement could also be unraveled
by a flare-up over their territorial disputes in
Aksai China and Arunachel Pradesh, energy
competition on the world stage and China's
encroachment into India's "sphere of influence" as
seen by its improving relations with Bangladesh,
Nepal and Sri Lanka, attempts to join the South
Asian Association for Regional Cooperation (SAARC)
and growing naval presence in the Indian Ocean.
Meanwhile, an increasingly active Japanese
military could push South Korea towards China,
while Chinese military aggression could push South
Korea closer to the Japan-US alliance. Internal
South Korean politics and events in North Korea in
terms of the humanitarian situation, political
stability and military posturing would also be
relevant in determining the future direction of
South Korea in the Asia-Pacific region.
Energy competition reveals the stages
of confrontation While Asian alliances
remain in a state of flux, the stages of
competition and confrontation are growing
increasingly clear. All the major Asian powers are
significant energy consumers and importers with
the US, China, Japan, South Korea and India being
the first, second, third, fourth and sixth-largest
energy consumers respectively. Thus, energy
competition will determine the stages of future
confrontation and conflict in Asia.
One
potential stage of conflict is the sea lanes of
Asia, which include the East and South China Sea,
the Malacca Strait and Hormuz and the Indian and
Pacific Oceans. These are not only vital as
transit points for energy shipments (eg half of
the world's oil transits through the Malacca
Strait ) but also as potential sources of energy
resources (eg territorial disputes in the
potentially energy-rich East and South China
Seas). Apart from facing the threat of a blockade
in the case of an inter-state conflict, the sea
lanes are also vulnerable as targets for piracy
and maritime terrorism. The Malacca Strait for
example, experiences 40% of the world's piracy.
India, Japan, China and the US have all expressed
interest in increasing their role in ensuring the
security of the strait, although Indonesia and
Malaysia have been reluctant to allow external
involvement in the region.
Each state is
attempting to address these threats in their own
way. For example, China is trying to strengthen
its blue-water naval capability as rumors of it
building or buying an aircraft carrier have
attested. It is also financing ports in Pakistan
(Gwader) and Myanmar (Sittwe) to bypass
chokepoints in the case of conflicts. China has
also leased Myanmar's Coco islands, which are in
close proximity to India's Andaman-Nicobar islands
and the Malacca Strait and the Bay of Bengal. It
has also engaged in open military posturing over
its territorial dispute with Japan over the East
China Sea, as seen last November when a Chinese
nuclear-powered submarine encroached into Japanese
waters off the Okinawa islands.
Another
potential stage of conflict is Central Asia where
the "New Great Game" is in full swing as states
and non-state actors compete for energy resources
and strategic influence. Recently, China National
Petroleum Corporation (CNPC) and India's ONGC
Mittal Energy (OME), a consortium comprising of
the Oil and Natural Gas Corporation (ONGC) and
Mittal Group competing for Canadian oil company,
PetroKazakahstan. An oil pipeline from Atasu in
north-western Kazakhstan to Alashankou in China's
Xinjinag province is due to be completed in
December, and in May China concluded a
US$600-million joint venture deal to develop
Uzbekistan's oil fields. China's Tarim Basin to
Shanghai (west-to-east) gas pipeline, which came
online last year could also potentially be
extended to Kazakhstan and Turkmenistan and even
further to Iran and the Caspian Sea.
Meanwhile, Iran and India have agreed to
jointly develop the Iranian port at Chahbahar as
well as the road linking the port to Afghanistan
and Central Asia, with India having exclusive
rights to the port. With the removal of the
Taliban regime from Afghanistan, the US-backed
Turkmenistan-Afghanistan-Pakistan (TAP) or
Trans-Afghan pipeline is also back on the table
and with an improvement in India-Pakistan
relations, the pipeline could potentially be
extended to India. Finally, the US is attempting
to undermine the Russian monopoly on oil and gas
pipelines from Central Asia to the west with the
inauguration of the Baku-Tiblisi-Ceyhan pipeline
in May.
In the military sphere all the
major players in the "New Great Game" have some
form of military presence in the region. As
Karimov ordered the US to withdraw its military
presence from Uzbekistan, US Secretary of Defense
Donald Rumsfeld visited Central Asia to ensure
that the US presence at Manas airbase in
Kyrgyzstan and over flight rights in Tajikistan
remained. Russia has also reasserted its presence
in Central Asia under President Vladimir Putin,
with a permanent military presence in Tajikistan
since its 1992-7 civil war as well as at Kant
airbase in Kyrgyzstan.
In an attempt to
contain the "three evils" of extremism, terrorism
and fundamentalism China, operating under the
aegis of the SCO, has established an anti-terror
center in Tashkent, Uzbekistan and engaged in
counter-terrorism exercises in Kyrgyzstan in 2002
and Kazakhstan in 2003. India has allegedly
established a military and medical facility in
Tajikistan. Apart from military influence, the
players are also attempting to exercise "soft"
power influence in the region, including
historical links (as in the case of India and
Russia), religious links (as in the case of Saudi
Arabia and Pakistan), cultural links (in the case
of Turkey and Iran) and economic links (in the
case of the US, South Korea and Japan).
Return of power politics The
international system is in a state of flux.
Contrary to many strategists, we are not at the
end of history. Rather, we have come full circle.
The players, technologies and motives may have
changed but the disputes are now fueled by
primordial loyalties and basic needs, such as
energy resources. Right now oil is the primary
catalyst for conflict but other resources such as
natural gas or water may soon play just as
prominent a role.
In these new conflicts
states still play a decisive role. The view that
states are becoming increasingly irrelevant is
incorrect. While non-governmental organizations,
multinational companies and civil society are
becoming increasingly important players, they are
not supplanting states. States still hold a clear
monopoly on the use of force. While terrorist
organizations challenge this monopoly, most groups
have nowhere near the capabilities of states and
often rely on the backing of states in the form of
funding, arms, training and sanctuaries. Thus, the
conflict scenarios with the most destructive
potential involve states either engaged in
conflict with each other or non-state actors.
Asia faces the volatile combination of a
number of states with historical rivalries growing
increasingly bold on the world stage as a result
of their increasing economic prosperity and
defense budgets, a rediscovery of their
identities, and increasing dependence on imported
energy resources. Power blocs are gradually
coalescing around shared interests. At present the
fulcrums of these power blocs could swing in a
number of directions. The real threat will emerge
when there is a solidification of these alliances.
Chietigj Bajpaee is an Asia
analyst. He has been a researcher for civic
exchange, a Hong Kong-based public policy
think-tank and for the London-based International
Institute for Strategic Studies and a risk analyst
for a New York-based risk management company. He
has a graduate degree in international relations
from the London School of Economics and an
undergraduate degree in economics and government
from Wesleyan and Oxford universities. His areas
of interest include energy security and political,
economic and security developments in the
Asia-Pacific region. He can be contacted at
c.bajpaee-alumni@lse.ac.uk.
(Copyright
2005 Asia Times Online Ltd. All rights reserved.
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