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The energy ties that bind India,
China
By Ramtanu Maitra
Myanmar newspapers have
reported that India will soon start a feasibility
study on building a deepsea port in Dawei, in
Myanmar's southern Tanintharyi division.
Subsequently, the Myanmar Ministry of Transport
made clear that the Dawei deepsea-port project
stands as one of the priorities among future
programs of BIMST-EC, the Bangladesh, India,
Myanmar, Sri 
Lanka
and Thailand-Economic Cooperation grouping (which was also
joined by Bhutan and Nepal last July).
Earlier, a
Myanmar Foreign Affairs Ministry official was
quoted by the Myanmar Times saying the shipping
route from southern India to Myanmar's deepsea
port at Dawei would help reduce the travel time of
cargo between India and Thailand that now goes
through the Malacca Strait and around the southern
tip of the Malay Peninsula to reach Bangkok.
Though Indian External Affairs Minister K
Natwar Singh's careful "suggestions" about
democracy got all the press play during his recent
visit to Myanmar, the Dawei deepsea port and
other measures to strengthen India-Myanmar
economic relations were no doubt discussed. They
are part of a series of important developments
taking place just below the radar in Asia that are
knitting the region together. As both India and
China move to secure their energy and economic
futures, they are developing infrastructure that
opens significant new potential for economic
cooperation and security.
India and
China converge on the Andaman Sea
India's interest in and involvement with Southeast
Asia has been growing steadily over the past
decade, and its concern for development of the
Andaman basin has grown accordingly. Last year,
an agreement was signed in Yangon by the
foreign ministers of India, Myanmar and Thailand
to develop transport linkages between the
three countries. When complete, the 1,400-kilometer road
corridor will be a highway of friendship linking
the peoples of South and Southeast Asia.
The planned deepsea port in Dawei,
together with the new highway connecting it to
Kanchanaburi in Thailand, will no doubt contribute
further toward closer trade and commercial links
between the two regions.
Dawei,
the capital of Tanintharyi division, is on a
long, narrow coastal plain (bounded by the Andaman
Sea in the east), which runs to Kawthaung, the
most southerly point of Myanmar, and which then
continues to the Malay Peninsula. Its location
affords both economic and security benefits.
Building Dawei port has a direct security angle
for the Indian navy, which is now in the process
of sorting out the technical and financial details
of its ambitious Far Eastern Naval Command (FENC)
project at Port Blair off the Andaman and Nicobar
Islands coast.
FENC will extend the navy's
nuclear/strategic combat capability and aid in
getting it "blue water" status. Dawei is located
across the Andaman Sea on the Myanmar coast almost
facing the FENC. India has another, more
specifically economic interest in Dawei port. Last
January, India reached agreement in principle with
Myanmar and Bangladesh on the construction and
operation of a pipeline that will bring natural
gas from Myanmar to India via Bangladesh,
according to reports by the Alexander Gas &
Oil company newsletter.
The
pipeline, which
is likely to cost more than US$1 billion, will
carry natural gas from the Shwe fields in
Myanmar's Rakhine or Arakan state, through the
Indian states of Mizoram and Tripura, then into
Bangladesh before finally crossing back into
India, all the way up to Kolkata.
Despite
an initial positive response from Dhaka, it is
likely that Bangladesh will drive a hard bargain
to let Myanmar gas flow through its territory to
India. Reports indicate that New Delhi has already
begun to consider two land routes bypassing
Bangladesh. According to one of the proposals, the
pipeline can run directly from Myanmar to India
through Tripura and Mizoram, circumventing
Bangladesh. But two other standby plans involve
importing the gas via offshore routes, which will
also skirt Bangladesh. The gas could be ferried in
ships as compressed or liquefied natural gas.
The Myanmar gas deal: A break for
India
The Myanmar gas deal helped to
impress on New Delhi that India has no choice but
to build up its capabilities to secure the Andaman
Sea and transform it into a major conduit for
regional economic cooperation.
China,
for its part, has been involved over a long
period building up infrastructure in Myanmar to
gain direct land access to the Southeast Asian
nations and the Andaman Sea. China is reportedly
engaged in building a deepsea port in Kyaukpyu,
in the western coastal Rakhine state. This port
would facilitate transit trade through the country
to the Andaman Sea, and beyond. One report
indicates that the Kyaukpyu port will serve as a
transit trade center for goods destined to the
port cities of Chittagong (Bangladesh), Yangon
(Myanmar) and Kolkata (India). Kyaukpyu, which has
a water depth of 20 meters and is capable of
accommodating 4,000 TEU (20-foot equivalent units)
container vessels, may turn out to be a very
useful port.
Importantly, Kyaukpyu
also stands at a point on the land route
connecting southwestern China's Kunming city with
Myanmar's Sittwe. Once the 1,943km Kunming-Kyuakpu
road is completed, Myanmar will begin to draw
economic benefit from the transit trade as well as
job opportunities for Myanmar workers and others
in the region. Construction of the seaport and the
road link, outlined as
Kunming-Mandalay-Kyaukpyu-Sittwe, is under
feasibility study, the Myanmar Ministry of
Construction was quoted as saying recently.
China's long-term
perspective
Beijing's move to get access
to the Indian Ocean via Myanmar and the Andaman
Sea is based on long-term perspectives. A number
of forecasts about China's future make it
evident that China will need more and more oil, gas
and coal to drive its massive economic engine.
But China's east-coast infrastructure is already
getting jammed up, and it must develop other inlet
points to feed southern and western China.
While developing a deepsea port is a
step toward getting energy resources into vast
southern China, Beijing is already moving quickly
to get direct imports into western China. Some of
it will come from Central Asian sources by land.
But it is surmised that as China grows
economically, it will also need Arabian oil and
gas to develop western China.
China is involved in developing Gwadar
Port on Pakistan's southwestern Makran coast
of Balochistan. Gwadar is almost at the mouth of
the Persian Gulf, 72km from Iran, and about
400km from the Strait of Hormuz. The Gwadar
project commenced in March 2002, and reports claim
that China has contributed a significant amount to
the estimated $1.16 billion cost.
In
addition, China is also planning to extend the
Karakoram Highway to bring oil and gas by road
into western China. Since the area is sensitive
for geostrategic reasons and India is involved in
two major land disputes in the general area - one
with Pakistan on the ownership of the state of
Jammu and Kashmir and the other with China on the
disputed status of Aksai Chin, New Delhi is
watching these developments carefully. It is
evident that the Chinese military is getting
prepared to provide full protection to Gwadar
Port, in cooperation with Pakistan.
Significantly, the anti-China crowd in
Washington and New Delhi have begun beating the
drums that Gwadar Port is a "forward deployment"
of the Chinese navy. The claim is that in addition
to attack submarines, the Chinese are planning a
major listening post in Gwadar (both to monitor US
activity in the Persian Gulf and to track shipping
in the Indian Ocean). That may well be true, but
to protect its vital oil and gas imports, wouldn't
any major nation be expected to take similar
measures?
The prospect for
cooperation
While neither India nor China
would be willing to be subjugated by the other, or
adopt the other's culture and way of life, there
is plenty of evidence that they would like to
cooperate to make each other's life a bit easier.
Indeed, this process has already begun in
Sudan, where China and India have come together to
exploit Sudan's oil and gas resources. Many claim
that the cooperation did not exclude competition.
Addressing the issue, a high-level adviser in the
Energy Research Institute of China's National
Development and Reform Commission, Zhao Fengqi,
pointed out to Lahore's Daily Times recently that
"although there is competition, both sides share a
common aim". A similar view was expressed by
India's energetic petroleum minister, Mani Shankar
Aiyar, who pointed out that both countries "are
always pitted against each other to the advantage
of the third country".
In Sudan's Greater
Nile Project, India and China are partners.
India's Oil and Natural Gas Commission Videsh has
stakes in Sudan's oil and gas projects, as well as
in countries such as Russia, Libya and Australia.
China has also gone out and bought stakes in oil
and gas fields around the world. China's
state-owned oil giant CNPC has invested billions
of dollars in projects in countries such as
Azerbaijan, Syria, Algeria, Ecuador, Peru, Chad
and Kazakhstan.
As both countries reach
out to ensure their oil and gas supplies for the
future, they will compete and they will cooperate.
Myanmar is one country in the region where this
convergency of interests may be demonstrated.
China's oil and gas from Arabia can come through
the Andaman Sea to Kyaukpyu and Dawei, reducing
traffic that otherwise must go through the Malacca
Strait. Besides the jamming of tankers in the
Malacca Strait, which would delay passage of ships
and create environmental hazards, the Indian Ocean
port-highway connection to China would preclude
use of the strait as a choke point to teach China
a lesson. India's contribution to minimize the
threat to China's oil imports could be a
foundation stone on which trust between these two
nations can be built.
Chinese Prime
Minister Wen Jiabao is in India on a four-day
visit. The pro-Washington faction within India's
political spectrum and India's not pro-US but
down-to-earth pragmatists have already charged
that Nepal King Gyanendra's irrational behavior is
China-instigated. There is no doubt that such
issues will be brought up, as much to slow down,
if not undermine, the developing Indo-Chinese
relationship as to clarify matters.
Both
prime ministers will have to tread through these
landmines carefully to lay the foundation for
building up a meaningful relationship based on
mutual benefit and trust.
Ramtanu
Maitra writes for a number of international
journals and is a regular contributor to the
Washington-based EIR and the New Delhi-based
Indian Defence Review. He also writes for Aakrosh,
India's defense-tied quarterly journal.
(Copyright 2005 Asia Times Online Ltd. All
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on sales, syndication and republishing.) |
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