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Flags of Kazakhsatn, China, and European Union pictured in one frame

Kazakhstan, the imperative to cooperate

by Olivier Arifon

Landlocked in the heart of Central Asia, Kazakhstan is involved in regional partnerships and, pragmatic, claims to be a facilitator with balanced relations, even if the pressure to take a stand between Russia, China and the European Union is strong. This cocktail is the challenge of so-called middle power (or bridge) countries, developing multi-factor diplomacy, here constrained by geography and made possible by the country’s resources. Moreover, the development and identity of the five Central Asian countries are built around the imperative of cooperation, given the geographical position and the small number of citizens (75 million for the five countries).  The 2023 edition of the Astana Forum, formerly economic and renamed Astana International Forum, was structured around four themes: foreign policy and international security, international development and sustainability, energy and climate change and economy and finance. This forum supports the development of international action: dialogue of international themes, with the desire to propose answers, desires to become a reference on the world scene without forgetting a public relations dimension. This has resulted in Kazakhstan’s diplomacy being described as ‘niche diplomacy’ (for uranium exchanges) or multi-vector diplomacy[1]. Since February 2022, the Belt and Road Initiative, China’s connectivity project, no longer pass through Russia. Kazakhstan is at the centre of the EU-funded Asia-Europe Transport Road (or Trans International Transport Road). This is one example where the economy, originally considered by Joseph Nye as a resource of hard power, becomes a factor of attractiveness and image for a country. In terms of analysis, considering a continuum – not a strict dichotomy – between hard power and soft power allows for more flexibility between projects and resources. This multilateral institutional program connects the rail freight container transport networks of China and the EU. The multimodal transport structure connects the Caspian and Black Sea ferry terminals with the rail systems of Asian and European countries. The route starts from Southeast Asia and China, crosses Kazakhstan, the Caspian Sea, Azerbaijan, Georgia, and Turkey. The so-called middle corridor is present in the speeches and in the initiatives and funding of the European Union and China. This land logistics link between the China and EU trading zones goes beyond transport to digitation of data and complying with European Union and UN standards. Therefore, several models are facing together depending on the view of China or the Union. Beyond this situation, what are the challenges for this middle power and in the broader context of countries that voluntarily and reasoned choose an identical approach and positioning? A successful solution for a middle power means choosing specific negotiating topics in the international space, being agile and flexible, and knowing how to build coalitions to defend them. In the context of multilateralism, it is necessary to structure actions for a convergence between its interests and those of the partners rather than on an ideology. This is one of the conditions for becoming credible, for developing its discourse and, ultimately, to be perceived by the international community as a country with positive contributions. And beyond this community, by the public, which comes down to finding its place on the world map in the long term, when the country becomes known and better identified. Diplomacy becomes public, because it consists of informing, or even dialogue with public opinion. Thus, the Astana Forum presents a middle power capable of building a regional dialogue with experts, politicians, and international actors, which contributes to the construction of legitimacy and the ability to influence through contacts, cooperation and media coverage. Being a middle power also means being courted in alliance competitions whose number and formats become exponential, which generates as many acronyms as possible, here China + C5 and EU + C5. Two recent summits, beyond content and photos, tell the stakes. The China-five Central Asian summit took place in May 2023 in Xi’an, China with the signing of 54 multilateral agreements. The meeting of the European Union and the five Central Asian countries took place at the beginning of June in Cholpon Ata, Kyrgyzstan. These are the five countries being courted no doubt with strong pressure to choose one or the other alliance, hence the tensions and questions of cooperation already mentioned. Moreover, contradictions exist between the possibilities and wills of the middle powers and the driving force of international institutions, structures with more rigid rules, including, for example, the Security Council. A new paradigm is emerging: the role of coalitions. Finally, middle-power countries must balance their national interests, common international challenges such as climate change, and building alliances and coalitions. Claims of middle powers, alliances and coalitions and connectivity programs may be shaping the geopolitics of tomorrow.

Dark blue sky with cumulus clouds and yellow rhombic road sign with text New World Order

The World is Changing: Who Will Set the Rules?

by Filippo Fasulo

Pivot to Asia - The Global South is on the march in their attempt to reshape the international system. How will this new order impact the old world? An increasing number of countries from the Global South, especially in Asia, are pushing to redefine the current global order. Three key trends to watch in this attempt to reshape the international system are the (potential) creation of a new economic order, the expansion of the BRICS grouping, and the transformation of China-Russia relationship after the invasion of Ukraine. In this changing international balance, Europe is losing its influence in the Global South, including in Asia. After centuries of global predominance, Europe’s strongest legacy is its role as a major normative power in global affairs. However, this reputation as a rule-setting power is set to change.   Why it matters 1. A (new) economic order. The debate over a “new Washington Consensus” has gained momentum after US national security advisor Jake Sullivan delivered a speech at the Brookings Institution on April 27th. The final communiqué by the G7 countries which met in Hirosahima on May 19-20 is the result of a similar strategic shift within the group, one that implies a move from economic interdependence to economic security. This shift is coupled with a major change in how the G7 intends to deal with emerging economies, such as their rival China and other partners in Asia that might soon become economic competitors in critical technologies. The G7’s sentiment has moved from promoting globalization and open markets to building industrial capacity in critical sectors, while securing existing and creating new strategic supply chains. Europe’s efforts in this context might not be enough: the investments envisaged so far are too little to reverse Europe’s dependency (often on China) in critical sectors. The EU must focus increasingly on diversifying its supply chains through securing access to rising economies in the Indo-Pacific. Here, joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) could represent an opportunity.  2. BRICS+? The BRICS foreign ministers’ summit in June was yet another steppingstone toward enlargement. The countries that expressed a significant interest in joining the grouping are Iran, Saudi Arabia, the United Arab Emirates, Cuba, Democratic Republic of Congo, Comoros, Gabon, and Kazakhstan: all these countries sent their representatives to Cape Town. Egypt, Argentina, Bangladesh, Guinea-Bissau and Indonesia participated virtually. While the membership process might be a long one, the group’s upcoming expansion highlights the Global South’s political will to rise its voice, with a plethora of actors eager and able to leverage the new competition between powers which is shaping up after the Ukraine war. In this framework, Asian countries such as China and India are competing with one another to lead the BRICS.   3. China and the Stans. On May 19, Xi Jinping met in Xi’an with the (leaders of) the five Central Asian “Stan”-countries (Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan, and Turkmenistan). Russia, the region’s traditional kingmaker, was noticeably absent. The meeting kickstarted – for the first time offline – a summit named C+5 and highlighted Beijing’s belief that it can now make deals within the region without Moscow’s supervision. China’s newfound independence in Central Asia and Moscow’s growing dependence on Beijing after the war in Ukraine provides new insights the on China-Russia relationship: although the two countries are united by their common desire to contest the US-led world order, the Sino-Russian relation seems increasingly tilted in China’s favor. This instable relationship could result in a stronger Chinese presence in Central Asia.  4. Loss of strategic centrality. Europe does not only risk becoming increasingly peripheral in world affairs, but also losing its bargaining power with the emerging Indo-Pacific economies. On the one hand, the EU needs to diversify its supply chains away from China and likely towards the ASEAN; on the other, the Global South – and by default its Asian members – is more aware of the current strategic window of opportunity to redesign the global balance of power.   Our take We are witnessing rapid changes in the international arena. In the coming months there will be increasing requests to review global norms. Therefore, the leading event will be the upcoming BRICS Summit in August: the meeting will probably certify the process to accept new members. Among the countries that are voicing their desire to reset the rules, some are considered by the West (mainly) as rivals, such as China, and as partners, like India. Therefore, Washington and Brussels cannot simply accept or dismiss their requests. Asia is claiming its century: the integration of this claim for a renewed global order into the current world order has just started. Its most important implications will be on the economic side, namely the redistribution of industrial capacity and trade relation in the context of de-risking from China.  Spotlight: G7  The G7 Hiroshima Summit has sent some clear messages to the rest of the world. The decision to invite President Zelensky to the gathering was a move meant to reinforce the unity of the members regarding the Ukraine invasion in the face of Russia — and China, too. The West has criticized China’s 12-point position paper on the Ukraine war, since it does not call for Russia to abandon occupied territories. The G7 countries have also announced a strengthening of the sanctions, seeking to curb products that could be used by the Russian military. The other important takeaway of the G7 is the joint statement directed at China, which includes a strong criticism of Beijing’s “economic coercion” and invites the PRC to play according to international rules. The G7 have also reiterated their position on divisive topics such as security in the Indo-Pacific and Taiwan, retreating their commitment to preserve peace and stability in the region. Despite the joint statement and the declarations by the leaders on the challenges posed by China, the G7’s stance on Beijing is still a balancing act. While concerned about being overly vulnerable with China, G7 economies and their industrial base remain strongly interconnected with the Asian country and despite calls for “de-risking”, such as cutting China out from some sectors like raw materials, it is impossible at the time.  Experts’ viewsThe implications of China’s activism among the BRICS countries  The next BRICS Summit will take place at a critical juncture for the Global South. Russia is still at war, Brazil has a new administration eager to flex its muscles globally, and China has reached unprecedented influence across the developing world. Since they are all connected by the same desire of multipolarity away from US and Western hegemony, it is likely that the BRICS will try to offer a roadmap towards a new international order. This roadmap, however, is far from consensual: will Russia embrace the peace dialogues offered by Brazil or African nations – and what role will China play in brokering any such proposal? Will China and the other BRICS be able to cooperate economically to promote development worldwide? Are the BRICS ready for its first enlargement, and who is most likely to join in the coming years? This arrangement will require some mutual concessions and the outcome will help shape the future world order.  Guilherme Casarões, Fundação Getulio Vargas  The push to strengthen and even expand the BRICS, especially by China, should be viewed more broadly through the lens of a pragmatic Chinese foreign policy. It has not only sought to strengthen ties within BRICS but with other regions and countries who are instrumental for its trade and infrastructure connectivity imperatives.  This happens against the backdrop of a shift towards a multipolar world order with China as a rising power and rising geo-political tensions. Given that this bloc advocates for issues that are relevant to the Global South (global governance reform, support for a rules-based international order and multilateralism in times when countries retreat to unilateral measures), it is no surprise that other countries in the South wish to join. Regarding this summit, I see no major implications for the bloc, the core business of the BRICS will continue with South Africa advancing its five priority areas. However, we can anticipate a discussion on its formal expansion. Trading with local currency seems to have found new impetus following the sanctions placed on Russia. All this notwithstanding, it is important to note that the ‘de-dollarisation’ in trade debate is not a new concept for BRICS and its less about challenging the dollar but strengthening other currencies against external economic shocks. The real test is for the host country depending on whether President Putin attends the heads of state summit in August, given Pretoria’s obligations under the Rome Statute and domestic law.  Luanda Mpungose, South African Institute of International Affairs (SAIIA)  China’s push for a stronger BRICS on the global stage is advancing along a number of trajectories. Firstly, there is the BRICS expansion as well as the BRICS+ format that are likely to bring the majority of the Global South into BRICS-related platforms of economic cooperation. The implementation of the BRICS+ format may serve as a precursor for liberalizing trade across the Global South and exploiting the potential for boosting South-South trade and investment ties. The expansion in the membership of the Shanghai-based New Development Bank as well as the creation of its regional centers will increase the scope for connectivity projects across the developing world. There is also the greater use of national currencies (most notably the yuan) via de-dollarization as well as the R5 BRICS common currency project that if launched would mark a key transformation of the global financial system.  Yaroslav Lissovolik, BRICS+ Analytics   What and Where Thailand is ready to Move Forward   The May elections in Thailand resulted in a clear victory for the opposition parties. Led by Pita Limjaroenrat, Move Forward has won 152 seats, becoming the most voted party in the elections. This party is the heir to Future Forward, which was dissolved by the military government in February 2020, and was born out of the 2020-2021 protests against the army and the monarchy. The second party in the country is the historic Thai opposition party led by the Shinawatra family, the Pheu Thai. However, while the population has expressed its preference, there is no guarantee yet that Move Forward, and the opposition, will govern. Indeed, to be elected Prime Minister, and form a government, Pita will need to win the majority in the bicameral parliament made up of the elected 500 seats in House of Representatives and the 250 seats of the Senate – whose members are handpicked by the military. The Move Forward coalition with Pheu Thai and the other opposition parties so far can count on little more than 310 votes, a long shot from the majority needed to govern. The opposition must garner support among the senators – which generally have little interest in going against the military that put them in power – or among the parties that have yet to declare their allegiance.  Cambodia: Hun Sen is getting rid of the competition ahead of July elections  On the 14 of May, Cambodia’s opposition party – the Candlelight Party – has been disqualified from running in the upcoming July elections by the country’s election commission. The party has allegedly failed to submit the necessary documentation to participate in the electoral race. With the exclusion of the Candlelight Party from the coming elections, the only possible competitor to the ruling Cambodian People’s party (CPP) of PM Hun Sen – who has been in power for 38 years – has been eliminated. This is not the first time that the main opposition party has been cut out of the electoral race. For instance, in the 2017 the Cambodian court, which is heavily colluded with the CPP, dissolved the Cambodian National Rescue Party (CNRP) before the 2018 general elections – a party that was given new life when its members created the Candlelight Party. However, the members of the opposition continue to be persecuted by Hun Sen’s forces with many political exponents arrested on charges of treason, assaulted, or forced to leave the country. With the opposition forces largely depleted and the main party banned from running for elections, Hun Sen is likely guaranteed another term.   The United States seeks to expand influence in the Indo-Pacific  Washington took advantage of two key international events to strengthen its strategic position in the region. During the Quad Leaders’ Summit, which took place on the sidelines of the G7 in Hiroshima, President Biden, Australia’s PM Albanese, PM Kishida of Japan and PM Modi of India stressed their unity and stated their plans to invest in digital infrastructure in the region. Throughout the meeting they did not mention China directly in their statements, but their references to the country were clear. The Quad expressed concern over the militarization of the region and the use of both economic and military coercion to alter the status quo – a clear reference to Chinese activity in the South China Sea. Another important step for the US to consolidate its position in the region is the announcement of the Supply Chain Agreement under the framework of the Indo-Pacific Economic Framework for Prosperity (IPEF). The agreement includes the 14 IPEF partner countries, namely Australia, Brunei, Fiji, India, Indonesia, Japan, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Thailand, the US, and Vietnam. A year following the launch of the IPEF, this agreement is the first practical measure undertaken by the group. The group did not announce any official trade commitments, there is expectation among partners for increased cooperation and monitoring of supply chains fragility. The concrete development is still unclear, but the agreement signals the need for Indo-Pacific countries to avoid supply chain disruption and to minimize their dependence on the region’s main economic player, China.  Semiconductors: China fires back   China has gone on the offensive in competition over the semiconductor sector. The Cyberspace Administration of China (CAC) has stated that products by Micron, the US largest memory chip maker, are a “security risk for the information infrastructure supply chain” barring infrastructure operators from buying them. While additional information has yet to be revealed, some negative impacts are expected for Micron even if China and Hong Kong accounted for only 16% of the revenue of the company in 2022. The measure is a retaliation to America’s effort to cut China out from the semiconductor sector and slow the development of its industrial base. Since October 2022, the Biden Administration has imposed strict controls over chips export, followed by the Netherlands and Japan, preventing China from accessing and producing more advanced semiconductors. China’s declaration comes also after the leaders of the G7 grouping released a statement criticizing the country’s economic coercion tactic. After the move from Beijing, Micron fears that their products will be replaced by South Korean competitors, Samsung and SK Hynix, on the Chinese market. In the rising technological row between the US and China, there is also fear that Beijing might choose to put some export controls over other sensitive technologies, such as solar panels – where China dominates the whole supply chain.    TREND: Despite rate hikes, Asian unemployment is faring well (but not for everyone)  In the current context of high inflation and high rates, unemployment has turned out to be one of the main socio-political issues of Asia. With skyrocketing prices hurting businesses and consumers, many central banks in the West have adopted more hawkish monetary policies during the last year. Yet, the soaring cost of money has forced many businesses into a tight spot with concerning consequences on the employment level. Some countries though – like Japan, China, and Indonesia – have made the unorthodox choice to not significantly raise rates during the last year, while others – like South Korea and India – have adopted similar policies to those of the FED and the ECB. However, the results vary. In Japan the unemployment rate has been quite steady at around 2.6% for some time now, but in China the range (5.2-5.7%) was wider, especially due to the uneven nature of the post-Covid economic recovery. Yet, as the economy is slowly returning to normal, Beijing’s unemployment rate is gradually decreasing. Meanwhile Korea has consolidated a positive trend, with the last available figure at 2.5%, but the reforms of the labor market proposed by President Yoon Suk-yeol may cause some issues. The critical indicator though will be youth unemployment. Employment in aging societies, like those of East Asia, will increasingly become a core issue to maintain the viability of existing social welfare programs. So far China has a staggering 20.8% unemployment rate in the 16-24 years old age group which is particularly concerning, as it is the 7.2% recorded in South Korea. Japan is faring quite well but unemployment in the 25-34 years old age bracket has risen since the beginning of the year from 3% to 4%.

Joe Biden with Prime Minister of India Narendra Modi

Modi in Washington: A Symbolic Visit for a Substantive Partnership

by Husain Haqqani , Aparna Pande

Officials from the United States and India occasionally have some difficult private conversations about Ukraine and India’s domestic politics. But the official state visit this week by Indian Prime Minister Narendra Modi to the U.S. will mainly be about showcasing the strength of the two countries’ burgeoning partnership.   Modi and President Joe Biden both need the optics of a visit rich in symbolism to demonstrate the substantive achievements of a relationship based on shared concerns about China and multi-billion dollar deals in technology and defense. Modi wants to highlight his standing as a world leader ahead of the 2024 Indian election. Biden wants to underline that, contrary to the criticism of some, he does have a plan to deal with China’s rise and the U.S. has lined up partners and allies to execute that plan. Indian prime ministers have been regular visitors to Washington D.C. since India’s independence in 1947. But Modi’s visit is only the third time an Indian prime minister will be given official state visit protocol, including a state banquet at the White House on June 22.  The fifth Indian prime minister to address a joint session of Congress, Modi will be the only Indian leader to do so for a second time. Indians will be thrilled by the attention given to their prime minister, and the speeches about shared values and similar strategic vision of the world’s oldest and largest democracies will play well in the Indian media.  But the visit will not be about just pomp and show. Trade in goods and services between India and the U.S. reached $190 billion last year and the U.S. is now India’s largest trading partner. Companies from the two countries have made significant investments across borders and Indian and American enjoy close people-to-people ties. Moreover, the U.S. is keen to “friendshore” with India to deal with the threat America sees in China’s rise, and to ensure supply-chain resilience. This involves shifting the manufacturing of certain critical components from China to friendly countries, especially India. The U.S. is funding Indian technology startups and infrastructure projects from its $200 billion Partnership for Global Infrastructure and Investment (PGII) Fund.  India, as the world’s most populous country, represents a large potential market for U.S. companies currently reducing their Chinese presence. When Air India, India’s largest airline, decided to purchase 220 Boeing aircraft in a $34 billion deal, Biden celebrated, saying it “will support over 1 million American jobs across 44 states, and many will not require a four-year college degree.” U.S. aerospace and military industries have wanted a greater share of the Indian market for years.  This January, India and the U.S. announced the launch of the U.S.-India Initiative on Critical and Emerging Technologies (iCET) to the pave the way for “technology value-chain partnerships that would lead to co-development and co-production of high technology products and services in both countries,” in the words of National Security Adviser Jake Sullivan.  During a recent visit to Delhi by Secretary of Defense Lloyd Austin, a defense industrial roadmap was unveiled, reflecting an American willingness to share state-of-the-art technology with India. But India wants to build an indigenous defense industry and is keen on American technology and investment, while the U.S. wants India to stop purchasing military equipment from Russia and buy more from the United States. Historically, that divergence has resulted in announcements that have not always resulted in implementation.  For the Modi visit, the two sides have planned two key defense related deliverables: the purchase by India of 30 General Atomics-manufactured Predator or MQ9B Sea Guardian drones for $3 billion, and an agreement between General Electric and Hindustan Aeronautics Limited to coproduce GE-F414 turbofan engines for India’s indigenous Tejas Mark-2 fighter jet. India and the U.S. have a long way to go before reaching the $500 billion mark in bilateral trade, which experts see as the future potential of the trade relationship. Americans blame India’s default preference for protectionism, reluctance to offer a level playing field to domestic and foreign players, strict digital privacy rules, and historical skepticism towards free and open trade. Indians complain that America is used to allies who are junior partners, not a country that is not an ally and wants to be treated as an equal. India is not alone in that view in an era when several powers want recognition and are showing a preference for economic and technology partnerships, rather than military alliances.  India is not a treaty ally of the United States, but a partner that prides itself on its strategic autonomy and one that has reservations about how it was treated by U.S. officials in the past. The closest equivalent of that in U.S. experience from the Cold War era would be France under the Gaullists. But just as the U.S. overcame its reservations about real or perceived French prickliness in the interest of preserving the Atlantic Alliance, Americans realize the importance of India in their plans for maintaining a rules-based international order.

 Former President of Iran Hassan Rouhani with Vladimir Putin

Diagnosing Iran’s emerging pivot toward Russia and China

by Mahmood Sariolghalam

“The world is not just Europe and America,” Iran’s foreign ministry spokesperson declared on April 10, 2023, implicitly echoing the views championed for years by the senior leadership of the Islamic Republic regarding the ostensible rise of China and Russia. Indeed, the moment when Iran shifted from a traditional balancing relationship between East and West to decisively embrace Russia and China occurred on May 8, 2018, when the Trump administration withdrew the United States from the 2015 Joint Comprehensive Plan of Action (JCPOA). The U.S.’s decision to abandon the nuclear deal deeply disillusioned the Iranian leadership about any possibility of a rapprochement with Washington. Tehran had initially agreed to sign the JCPOA with the Obama administration based on the expectations that its promises to substantially reduce its nuclear program would be recompensed by the lifting of a substantial portion of U.S. economic sanctions.  Consistent with its long-held objective of maintaining distance from Washington, Tehran was pleased that the JCPOA, as agreed, had permitted it to avoid normalizing relations with its adversary while still reaping the economic benefits by being able to resume oil exports and welcome foreign investment. Yet following the U.S. withdrawal from the nuclear deal, Iran concluded that Washington’s policy toward Tehran is unreliable and the American political class could not be swayed. The Iranian leadership was further disillusioned by the Europeans’ limited ability or willingness to preserve the 2015 agreement. Moreover, the convergence of additional domestic factors — such as pressure from hardliners to bolster the country’s defensive and offensive military capabilities, the weakening state of the economy, and looming challenges to the continuity of the political system — led to intensive debates about the direction of Iran’s foreign policy. Though the foreign and defense policy bureaucracy made the decision to reorient Iranian relations more fully toward China and Russia as early as 2019, it had to wait until the Hassan Rouhani government completed its term in August 2021 before taking any concrete steps in this direction. A clear indication of that decision can be traced to the constant stalling tactics used by the Rouhani delegation during the talks with the U.S. and the broader international community on potentially reviving the JCPOA. The pivot to the East took on a more noticeable character following the inauguration of President Ebrahim Raisi on Aug. 5, 2021. The Raisi presidency led to higher levels of policy compatibility in the totality of the Iranian political system, but even more importantly, it resulted in the executive branch rank and file being staffed with devotees, loyal administrators, and 1970s-era revolutionaries. This was a necessary move following the Rouhani presidency, during which somewhat liberal administrators permeated the bureaucracy. Since the Islamic Revolution, Iran’s legislative and judicial branches have consistently demonstrated their loyalty to the status quo. However, following each change of president, the executive branch has had the opportunity to fill some 11,000 administrative positions throughout the country with like-minded individuals. Now, with the inauguration of the more conservative Raisi government, all three branches are committed to maintaining the current inertia and coherence of the Islamic Republic. Iran is now pursuing a two-tiered foreign policy: a vigorous and determined shift toward Russia and China on the one hand, while, on the other hand, making incremental concessions on its nuclear program to give the impression that another deal can be struck to replace the JCPOA. The former approach is being implemented with almost zero fanfare and the latter with extensive publicity. Iran has been steadfast in its Eastward turn even though this shift does not enjoy the support of the general public or the professional and educated classes in particular. As such, all debate and discussions regarding the country’s foreign policy orientation have been restricted to tightly knit circles within the top ruling elite. Still, it is possible to deduce three broad reasons for Iran’s growing alliance with China and Russia: 1. A refusal to capitulate to or make vast concessions to the United States;2. The valuing of security concerns as more important than economic development needs; and3. The desire to see continuity of the political system.Avoiding capitulating to the United StatesIran has a long-standing policy of avoiding normalization with the United States. Throughout the post-revolutionary period, Tehran has deliberately avoided any moves toward rapprochement except in the face of imminent danger or a potential U.S. military operation against the Islamic Republic. The underlying calculus maintains that normalization with Washington would lead to profound consequences for the current Iranian political system, from disrupting its internal politics to overwhelming its economy and reshaping its culture. First of all, there is a deep-seated fear in Tehran that once American companies, educational institutions, and civil society organizations become active in the country, the Iranian leadership would gradually lose much of its grip on power. Anti-American sentiment also provides the revolutionary class with a common identity and keeps more internationally minded, moderate, or pragmatic groups out of positions of authority. Even following the JCPOA agreement and prior to the inauguration of U.S. President Donald Trump, the dominant perception in the Iranian capital was one of despair since most of the economic sanctions on the country remained intact. The ambiguous future of sanctions, combined with the possibility of spill-over effects on regional issues, created an atmosphere of uncertainty within the corridors of power in Iran. Another factor that dampens hopes for change in U.S.-Iranian relations is Washington’s long list of demands not only with regard to Iran’s foreign policy and nuclear program but also about the nature of its political system and internal conduct. A final facet standing in the way of improved bilateral relations — and closely related to the first — is the Iranian revolutionary class’s belief that rapprochement with the United States would inevitably result in undesired substantial changes in the political system. Any long-lasting improvement in the relationship would require not just policy change but also a redesign of state structures. In line with this thinking, concessions on the nuclear program would be inadequate; Iran would ultimately need to fully capitulate to the U.S., reviving bitter memories of the 1953 American-British coup d’état. The Farsi word for submission, tasleem, was, thus, widely used in the revolutionary state media and television to characterize Washington’s ostensible expectations from Tehran in the realization of the JCPOA. With its vast stake in the political and economic spheres of the state, Iran’s revolutionary class was not prepared to abandon power or open the political floodgates by making structural concessions to the U.S. and facilitating a possible takeover of the country by liberal presidential candidates. The disillusionment in the aftermath of the JCPOA agreement fostered a Raisi-type conservative presidency, an essential prerequisite to the consolidation and continuity of the revolutionary Iranian polity.Precedence of security concerns over economic developmentAt no point in its history has the Islamic Republic prioritized domestic economic development. Continued reliance on energy exports has furnished the state and its elites with a stream of income to maintain this system. Iran’s activist foreign policy antagonizes a large number of neighboring and external countries, yet the leadership considers it essential to protecting the state. For many decades, Iran’s national security doctrine has articulated a hedging strategy of relying on Shi’a and/or anti-Western enclaves in the Middle East to expand its territorial influence vis-à-vis major Arab countries, Israel, and the United States. Turkey is perhaps the only major country in the region with which Iran has been able to manage a stable relationship over the long term. In recent years, Tehran has additionally militarily aligned itself with a major outside power — Russia. Furthermore, Iran’s drone and missile capabilities as well as its geopolitical influence in much of the region have served as a dependable deterrence strategy. Such a conceptualization of national security, threat perceptions, and statecraft have left little room to pursue economic development in a globalized economy. This sharply contrasts with regional neighbors such as Saudi Arabia, Turkey, Israel, and the United Arab Emirates, which have deliberately been concentrating their energies on economic diversification, high-tech industries, renewable energy, and attracting foreign direct investment (FDI). The economic rise of China and Russia’s military and political capabilities have provided a wide range of opportunities for numerous developing countries, including India, Indonesia, Brazil, Nigeria, South Africa, and Mexico, to diversify their foreign and economic policies. However, while drawing on the support they can obtain from Beijing and Moscow, most still strive to maintain a balance between the West and the East. These countries benefit from European and American financial and technological sectors and earn sizeable profits by selling in their markets. But since national economic development is not a priority for the Iranian leadership, and it devotes a large proportion of its energies toward domestic and national security, even a complete political and economic pivot away from the West will not jeopardize Iranian state-owned industries nor affect the already-sidelined private sector and dwindling consumer markets. Indeed, Western companies and banks have also removed Iran as a potential market due to U.S. and European sanctions. Ultimately, Iran’s pivot toward the East will reduce its economy to selling fossil fuels to China and a few other Asian-Pacific countries in exchange for commodity imports. And it is unlikely that these consumers will turn around and invest in Iranian industries due to the sanctions restrictions currently in place. The only conceivable investment opportunities would perhaps be in the form of barter, wherein Iran might export petroleum in exchange for infrastructure development with no financial transactions involved. Furthermore, the timing of the Iranian leadership’s decision to reduce the country’s political and economic reliance on the West in general and Europe in particular was critical: Namely, that strategic choice was made ahead of the looming leadership transition at the top to avoid possible dissenting views when Iran’s third supreme leader takes over. Closer relations with Russia and China promise to not only de-risk Iran’s foreign economic relations but also help maintain an optimum level of progress on the nuclear program as a strategic component of the national security doctrine.Continuity of the political systemIran’s anti-Americanism is considered a highly treasured geostrategic asset in Moscow. In a sense, Iran is Russia’s southern Belarus. From a historical perspective, all permutations of the Russian state over the last two centuries, from the Russian Empire to the Soviet Union to the Russian Federation today, have pursued a similar policy of trying to keep Iran out of the Western orbit. But the Russian-Iranian military partnership that developed in Syria and solidified over Ukraine — specifically covering military hardware, cyber software, and digital surveillance tools that Iran has no hopes procuring through cooperation with the West — has also furthered Tehran’s leverage vis-à-vis Israel and the United States. Iran is expected to receive 24 Su-35 fighter aircraft from Russia in addition to S-400 air-defense systems. And the relationship is developing in both directions. Tehran has also supplied Moscow with low-cost drones and weapons systems. Additionally, the two countries are cooperating in the energy sector, with Russia reportedly having delivered 30,000 tons of diesel fuel to Iran in February and March 2023; yet given Russia’s technological limitations in the energy sector, it is not clear whether these projects will eventually and efficiently materialize. Though relations with Russia have undoubtedly expanded in the military domain since the invasion of Ukraine, one can also deduct other Iranian motives to further solidify relations with Moscow. There are at least two crucial reasons behind Iran’s desire to tighten its cooperation with Russia and move from a transactional to a strategic bilateral relationship. First is Tehran’s need to secure intelligence on Israeli and American operations against Iran. And second is the desire to draw on Moscow’s potential political and intelligence assistance during the transition period to the third supreme leader of Iran. Such expectations can be met with or without Vladimir Putin in the Kremlin since they fulfill fundamental Russian interests vis-à-vis Iran and the West. Iran has reached a point where it can no longer depend on increasing internal control and expanding regional deterrence to maintain a status quo conducive to preserving the political system. Israel’s traditional “periphery doctrine,” of reaching out to non-Arab countries to build security partnerships, has now expanded to the South Caucasus and Central Asian regions. Moreover, most Arab neighbors of Iran today maintain normal or at least not overtly antagonistic diplomatic relations with Israel, which has improved American leverage with regard to Tehran as a result. Facing limited foreign policy options, including diminishing hopes of reaching a modus vivendi with the United States through reviving the JCPOA and a lasting divergence in relations between Russia and the West, Tehran has had to succumb to Moscow. This was not only to procure new military hardware but also to secure its position in a shifting regional matrix, deter potential future threats to its internal security, and safeguard the continuity of the political system. In this evolving context, as long as Russian interests remain opposed to those of the West, Moscow will likely do whatever is necessary to protect the Islamic Republic of Iran. Unlike Russia’s more strategic and long-term calculus vis-à-vis the Islamic Republic, China confines itself to mostly political and commercial relations with Iran and appears to cautiously act in parallel to the U.S. in the Middle East rather than in opposition to it. Beijing has immense short-term and long-term commercial and technological interests in maintaining peace and cooperation with Israel as well as with major Arab countries, such as Saudi Arabia and the UAE. Moreover, petroleum imports from Iran can easily be substituted in a global glut. That said, Beijing’s mediation role between Iran and Saudi Arabia highlights that for China, good relations with the Islamic Republic provide useful political leverage when navigating the region as well as in its global rivalry with the United States.Challenges aheadThis article attempted to explain Iran’s calculations behind politically and economically pivoting toward Russia and China, founded upon the assumption that the deep state in Iran is prioritizing continuity and issues of succession in the political system. Almost all matters of state are overshadowed by these medium- to long-term concerns — a set of priorities that Iranian leaders have, in fact, held for centuries. The question facing the government today, however, is how the revolutionary domestic apparatus can strive to survive the myriad sources of domestic and foreign challenges, including the Islamic Republic’s stand-off against the Western world. In contrast to the United States and Europe, Russia and China are not concerned with Iran’s internal political system, constitutional structures, or governmental machinery. Of its three main adversaries, namely, the U.S., Israel, and Saudi Arabia, Iran recently concluded that a rapprochement with Saudi Arabia is a possibility, having made a complete U-turn on this in March 2023, with the help of Chinese mediation. Iran had learned the hard way to compromise with the Saudis, given the latter’s instrumental political and financial role among Iranian minorities inside the country as well as Iranian opposition groups in Europe and the U.S. In order to mitigate this influence, Tehran apparently decided to make concessions on Yemen in return for reduced Saudi support for the Iranian opposition. Of all the points of leverage at Iran’s disposal in the Middle East, Yemen appears to be the least valued, especially compared to Lebanon, Iraq, and Syria. Evidently, the Iranian leadership’s incremental moves toward China and Russia stem from an unwillingness to redefine the underpinnings of the country’s national security doctrine. Not only does Iran’s current foreign policy orientation not run in opposition to Beijing’s or Moscow’s overall international outlook, but in many ways, its anti-Western predisposition in a critical region of the world serves the two powers in their difficult relationships with the United States. By aligning with Russia and China in the security and commercial spheres, Iran feels it has acquired an insurance policy against any potential negative resolutions emanating from the United Nations Security Council. And even more consequentially, with an eye toward the potentially turbulent looming period of leadership transition and succession, Tehran may feel comfortable with relying on Moscow and Beijing for security, political, intelligence, and financial support. But a major challenge confronts the political system: Will the Iranian public, professional and intellectual groups, and the country’s slim private sector — all deeply accustomed to Western ideas, systems, and customs — be willing to embrace and adapt themselves to this Eastward shift that was formulated by Iran’s political and security elites? Perhaps the social and political atmospherics that emerge as the Islamic Republic’s third supreme leadership seeks to consolidate its power will reveal the durability of this unbalanced geopolitical reorientation.

Annie Raja General Secretary of National Federation of Indian Women protesting against the Taliban takeover of Afghanistan

India-Taliban relations: A careful balancing act, driven by pragmatism

by Vinay Kaura

An ongoing power struggle for the position of ambassador at the Afghan embassy in New Delhi underlines India’s diplomatic quandary about the nature of its engagement with the Taliban regime in Afghanistan. India’s Ministry of External Affairs (MEA) has not issued any public statement regarding the dispute between representatives of the previous Islamic Republic of Afghanistan and the Taliban’s Islamic Emirate of Afghanistan over who should occupy the post, but reports suggest India has conveyed to both sides that they need to settle their internal issue on their own. However, the fact that the visa of Qadir Shah, the person appointed by the Afghan Taliban as chargé d’affaires in New Delhi, has reportedly expired further complicates the power struggle. If the Indian government decides to extend Shah’s visa, it would interpreted as India’s willingness to accept a Taliban-appointed diplomat in the Afghan embassy in New Delhi. Following its seizure of power in August 2021 after overthrowing the U.S.-backed Ashraf Ghani government, the Taliban regime has been seeking international diplomatic recognition along with Afghanistan’s seat at the United Nations. The Taliban regime has so far taken control of more than a dozen missions abroad, but India is yet to have a Taliban-appointed ambassador. In March, the Taliban regime’s spokesman, Zabihullah Mujahid, revealed that “efforts are underway to take charge of other diplomatic missions abroad. [...] Diplomats of the former government are continuing their activities in coordination with the [Taliban] Foreign Ministry.” Afghan embassies in Pakistan, China, Russia, Iran, Turkey, Kazakhstan, and some other Arab and African countries are now working under Taliban-appointed diplomats. India’s involvement in Afghanistan The security, economic, and humanitarian vacuum left by the withdrawal of American troops has significant implications for India’s interests in Afghanistan. India has always required and worked for a relatively stable Afghanistan free from threats by terrorist groups. Without formally recognizing the Taliban regime, in its many recent official statements India has made clear that it recognizes the reality on the ground. While India has also underscored the need for the Taliban regime to reform its governance in terms of gender and ethnic inclusivity, such normative considerations are unlikely to influence the substance of the India-Taliban relationship insofar as they do not essentially affect regional stability. India has no history of military intervention or political interference in Afghanistan and New Delhi has focused on forging people-to-people connections and projecting soft power. That is why, despite setbacks due to the hasty exit of U.S. forces, India continues to maintain goodwill among ordinary Afghans and perhaps even a section of the Taliban leadership (such as Abbas Stanikzai, the Taliban’s deputy foreign minister, who is believed to have a soft spot for India). Next to the U.S., India was Afghanistan’s principal regional source of development assistance since the Taliban’s ouster in 2001. In fact, India’s engagement with Afghanistan offers a compelling example of the use of soft power. Beyond its geostrategic motives, New Delhi was determined to bolster Kabul to ensure that a radical Islamist regime beholden to Pakistan’s security establishment did not gain a foothold in the region. That India and the Taliban-led Afghanistan have gradually drawn together to the extent that they have is an example of pragmatism in foreign policy making at its best. For India, it makes sense to try to give some reason, in the form of diplomatic exchanges and developmental assistance, for the Taliban not to permit the export of terrorism from Afghan soil. For the Taliban, notwithstanding their ideological rigidity domestically, the dire need for development assistance means maintaining silence on India’s policies on the Kashmir Valley, which is predominantly Muslim.  The Taliban have sought India’s assistance in rebuilding their country. For a regime that has been diplomatically and financially isolated, its normal relationship with India also holds much pragmatic appeal, given New Delhi’s growing geopolitical influence and longstanding interest in accessing Central Asian markets via Afghanistan. New Delhi expands its presence and engagement In June last year, New Delhi decided to deploy a “technical team” at the Indian embassy in Kabul to re-establish its diplomatic presence in Afghanistan for the first time since the Taliban takeover. And soon after, when India delivered a consignment of medical supplies to Afghanistan as part of its humanitarian assistance, India’s external affairs minister, S. Jaishankar, characterized India as “a true first responder” in Afghanistan. India’s move to expand its diplomatic presence is also driven by a desire to coordinate humanitarian relief efforts. In order to avert a humanitarian crisis in Afghanistan, India supplied 40,000 metric tons (MT) of wheat overland via Pakistan in February 2022 and an additional 20,000 MT via Iran’s Chabahar port in March 2023 to be distributed through the U.N. World Food Programme (WFP), along with 45 tons of medical assistance in October 2022, including essential life-saving medicines, anti-TB medicines, 500,000 doses of COVID-19 vaccines, winter clothing, and tons of disaster relief material, among other supplies. In addition, India’s union budget for 2023-24 also made a special provision for a $25 million development aid package for Afghanistan, which has been welcomed by the Taliban. The Taliban have reportedly requested that India finish about 20 incomplete infrastructure development projects across the country. In April, during the signing of a memorandum of understanding with India for the dispatch of an additional 10,000 MT of wheat, the WFP assured India that it has the necessary infrastructure on the ground to quickly deliver the wheat to the most needy sections of the Afghan population. Recently, the MEA, under the aegis of the India Technical and Economic Cooperation Programme (ITEC), invited Afghan government officials to attend a four-day virtual course on Indian legislation and business climate. In principle, India’s outreach to the Taliban is also conducive to achieving its counterterrorism objectives. However, there is a risk of over-expectation on the part of New Delhi that the Taliban would crack down on anti-India terrorists, as well as indications that the Taliban regime continues to maintain its deep links with Pakistan’s security establishment. It has been suggested by National Defense University Professor Hassan Abbas in his recently published book, The Return of the Taliban, that the Taliban regime consulted the Pakistani military before allowing India to reestablish its diplomatic presence in Kabul in June 2022. The Taliban’s ideological constraints India-Taliban relations could be hampered by the Taliban’s internal ideological positions, which the group has clung to rigidly even at the expense of its efforts to secure international recognition. The Taliban regime banned girls from educational institutions and prevented women from working in most fields of employment, including at non-governmental organizations. Women have also been ordered to cover themselves in public and are barred from many entertainment and sports venues. External pressure, including the imposition of sanctions, has not done much to convince the rigid hardliners within the Taliban regime to change their direction on human rights, gender equality, or ethnic representation in governance. This suggests that there are limits to what India can achieve through its interactions with the Taliban. The risks for India are heightened because some Pakistan-based terrorist groups would likely criticize the Taliban regime for seeking closer ties with India. Moreover, were Kabul’s cooperation with New Delhi to pose a threat to the Taliban’s own internal ideological legitimacy, this would also serve as a check on efforts to normalize relations. Regional dynamics and prospects for cooperation The Taliban regime is enthusiastically courting other regional powers as well, such as China, Russia, and Iran, each of which has its own regional interests. For instance, in contrast to India’s passive role and limited footprint in Afghanistan, China has been expanding its diplomatic and economic presence in the country. Recently, China discussed with the Taliban regime how to bring Afghanistan into the Belt and Road Initiative (BRI) to boost investment in the crisis-hit country, while also pressing Kabul to deliver on its regional and international commitments to counter terror. In January of this year, Beijing signed a 25-year contract to extract oil from the Afghan Amu Darya Basin and is also negotiating other lucrative commercial deals with the Taliban regime. Central Asia has often been seen as a test case for Indian leadership. It is in Afghanistan that India has taken a notably more proactive approach to driving regional cooperation through connectivity initiatives. India has also used the Shanghai Cooperation Organization (SCO) platform for this purpose. With inclusion of Iran this year, membership in the Eurasian political, economic, and security organization now includes all of Afghanistan’s immediate neighbors with the exception of Turkmenistan. Early this month in Goa, India, the foreign ministers of SCO countries called for the establishment of a representative government in Afghanistan as well as the protection of women’s rights. Indian External Affairs Minister Jaishankar remarked, “Our immediate priorities include providing humanitarian assistance, ensuring a truly inclusive and representative government, combating terrorism and drug trafficking, and preserving the rights of women, children, and minorities.” While the SCO might appear a viable platform for regional cooperation, there are certain limits to its effectiveness in dealing with Afghanistan due to the divergent political and security interests of some SCO members, particularly India and Pakistan. Moreover, given Russia’s reduced international stature and Beijing’s growing leverage over Moscow due to its brutal war against Ukraine, the SCO is now a China-led organization. China is a key participant in many important regional forums where Afghanistan remains a core security concern. Since India has a very uneasy relationship with China and supports U.S.-led geopolitical initiatives, primarily the Quadrilateral Security Initiative or Quad (comprising India, the U.S., Japan, and Australia), to counter China, there are practical constraints to what India can achieve through the SCO.   While the Taliban have not yet shown the traits required for recognition as a legitimate political organization responsible for governing Afghanistan, the non-recognition of their regime should not worsen the suffering of the Afghan people. India has a clear interest in a stable and well-governed Afghanistan, not least to prevent spillover into Kashmir. For now, India’s policy toward Afghanistan remains focused on building pragmatic, if not cooperative, relations with the Taliban. India is engaging the regime on its own terms and continues to highlight its commitment to Afghanistan’s ethnic minorities and women. India is equally careful that its interactions should not be viewed as a diplomatic embrace of the Taliban or its acceptance of their repugnant governance model.

President of China Xi Jinping

The Dawn of Xivilization: Israel and China’s New Global Initiatives

by Tuvia Gering

In the last two years, China's leader, Xi Jinping, has announced three global initiatives: the Global Development Initiative (GDI), the Global Security Initiative (GSI), and the Global Civilization Initiative (GCI). What exactly are they, how do they differ from the Belt and Road Initiative (BRI), and what do they imply for the State of Israel? In the last two years, Chinese leader Xi Jinping has announced three global initiatives: the Global Development Initiative (GDI), the Global Security Initiative (GSI), and the Global Civilization Initiative (GCI). These new initiatives are a means of bolstering the legitimacy of the Chinese Communist Party, with Xi at its head. More importantly, they reflect how China’s foreign policy has evolved and the lessons learned from its global engagement in the ten years since the Belt and Road Initiative (BRI) was launched. Due to the prominence of these initiatives in China’s foreign policy, Israel will need to closely monitor their progress and weigh the implications for its security and interests. While Jerusalem must strive to continue cooperating with China where those considerations are maintained, it must avoid blanket support for initiatives that serve China’s propaganda and interests at the expense of the West and the US in particular. Such backing could lend credence to Beijing’s efforts to undermine Washington’s security framework in the Middle East, which is the bedrock of Israel’s security. Additionally, it could support Beijing’s efforts to undermine universal norms and values.“This is a victory for peace,” pronounced China’s top diplomat, Wang Yi, after overseeing the signing of a normalization agreement between Iran and Saudi Arabia on March 10, 2023. Wang emphasized that the credit for the breakthrough should be given to General Secretary Xi Jinping’s Global Security Initiative (GSI). The same initiative had been mentioned by Chinese Foreign Minister Qin Gang as a possible basis for resolving the Ukrainian war, and once more in a conversation with Israeli Foreign Minister Eli Cohen on April 17 as means of resolving the Israeli-Palestinian conflict. Over the last decade, the Belt and Road Initiative (BRI) had been the centerpiece of Xi’s foreign policy, but three additional Chinese initiatives that have been launched in the last two years now challenge its primacy. The first is Xi’s Global Development Initiative (GDI), which he announced at the UN General Assembly in September 2021. With global growth slowing in the shadow of COVID-19, its stated goal is to assist the international community in achieving the UN 2030 Agenda’s 17 Sustainable Development Goals (SDGs). In June 2022, China announced 32 concrete steps (“deliverables”) for its implementation, which bring together existing Chinese-led development initiatives while adding new tools and resources. Among them are a billion dollars added to the three-billion-dollar Beijing-led South-South development fund and the training of 100,000 workers by China. The second is the Global Security Initiative (GSI), launched in April 2022. It complements the GDI based on the Sinicized Marxist notion that “security is a prerequisite for development, and development is a guarantee for security.” In a GSI Concept Paper published last February, on the one-year anniversary of the war in Ukraine, China called for a “joint, comprehensive, cooperative and sustainable” security that respects the sovereignty of countries and addresses their “legitimate security concerns.” Chinese leaders maintain that the GSI promotes a “new” security concept that complies with the UN Charter, abides by peaceful resolution of disputes, and maintains world peace in “traditional security” (areas related to warfare and power politics) and “non-traditional security” (such as climate, economy, cyber, and pandemics). The GDI and GSI were joined in March by the Global Civilization Initiative (GCI), which focuses on “soft power” fields such as education, culture, and values. According to the Chinese foreign minister, the GCI’s goal is to promote “unity, harmony, mutual respect, and mutual understanding among different civilizations” and to support the “shared values of humanity.” What Distinguishes the Global Initiatives from the Belt and Road Initiative? The BRI will be ten years old this December, and by that time, approximately 14,000 projects in 165 countries totaling trillions of dollars will have been associated with its name. Regardless of the economic contributions it makes to its partners, the initiative has had an “image problem” in recent years due to corruption, lack of transparency, and damage to the environment and to workers’ rights (the prevalent claim that China sets “debt traps” to seize assets, however, has been thoroughly debunked). Domestic and foreign funding constraints, as well as the number of projects and “competing brands” of the G7, the European Union, India, and Japan have exacerbated the challenges. The BRI has its roots in the turn of the century, more than a decade before Xi came to power, in localized development initiatives in China’s border regions. In comparison, the new initiatives are his and, by definition, “global” from the start. Unlike the BRI’s Sinocentric “Silk Roads,” they promote issues that enjoy a broad international consensus, as a senior Chinese diplomat put it: “Who would oppose cooperation on development?” Indeed, as of April, the GDI had received the support of over a hundred countries and international organizations, as well as the UN Secretary-General’s blessing, and nearly 70 countries had joined the “Group of Friends of the GDI” headquartered in New York. With the 69-year-old Xi entering his third term and no successor in sight, the initiatives are accompanied by a personality cult campaign (party-state propaganda aptly coined the term “Xivilization”). Their goal is to legitimize the leader’s perpetual rule and the party he heads, painting him as a “great Marxist strategist” who “cares for the fate of humanity” and is capable of identifying global “deficits” in development, security, trust, and governance. They also demonstrate the evolution of China’s foreign policy under Xi, from maintaining a low profile to “striving for achievement.” This activism, or “spirit of struggle,” is promoted in light of his catchphrase “great changes unseen in a century.” Because China has become so entwined with the world and vice versa, responding to the changes is not enough; Beijing must “get closer to world’s center stage” and seize the initiative so that the changes are in line with its interests and values. Finally, the three initiatives demonstrate Beijing’s genuine faith in the “righteousness of its way.” After four decades of almost double-digit growth, China has turned from a backward country into an economic powerhouse. In Xi’s view, China’s rise is a mirror image of the decline of the United States and the West, and it attests to the superiority of the “Chinese model.” Along with the BRI, the three initiatives serve as the “blueprint” for a new world order – a post-Western world order – that will see the “great rejuvenation of the Chinese nation” and the realization of Xi’s vision of a “community with a shared destiny for mankind”: The GDI aims to set the agenda for global development by first coopting this high-consensus concept and then transforming it. Under this kind of “development,” the sovereign state’s interests trump individual freedoms. And unlike the Sinocentric Silk Roads, the GDI works toward the SDGs and has its own exclusive and US-free China-led “Group of Friends of the GDI” under the auspices of the UN. This fact confers international legitimacy and makes its anti-liberal ideas more palatable. For instance, its emphasis on cyber cooperation is done under the guise of China’s “internet sovereignty,” i.e., securing a global network that is atomized, censored, and monitored. The GSI’s very definition of a “new security concept” implies an antithesis to an “old security concept” led by the US. According to China, the latter advocates a zero-sum game, inciting camp confrontations and nurturing a Cold War mentality. In reality, the GSI is intended to undermine the legitimacy of the network of US-led security alliances and partnerships that Beijing sees as a threat, including NATO, the Quad, AUKUS, and the G7. The GSI Concept Paper, for example, calls for a “new security architecture,” for the holding of Middle East security forums in Beijing, and the convening of “a larger, more authoritative, and more influential international peace conference” for the Israeli-Palestinian conflict. Xi stated at the unveiling of the GCI that the success of the Chinese development model “breaks the myth of modernization equals Westernization.” It presupposes that the US is fueling a “clash of civilizations,” whereas China wants to allow “all flowers to bloom in the big garden of world civilizations.” This remark by the Chinese foreign minister should serve as a stark reminder of the last time a Chinese leader wished to “let a hundred flowers bloom.” Today, China employs cultural relativism of so-called “shared values of humanity” to redefine the very essence of universal values such as human rights and democracy as subject to the dictates of the sovereign state. In doing so, it seeks to deter “interference in internal affairs” in the name of the universal values that it violates. Implications for Israel As with the BRI, China has not yet established any clear-cut mechanisms, budgets, nor timetables for the three initiatives. As for the Chinese mediation between Iran and Saudi Arabia, it was evidently linked to the GSI only after the fact, much in the same way the BRI umbrella brought together a haphazard assortment of projects that had begun prior to its launch. The three initiatives, however, should not be dismissed as mere rhetoric. Even if most of their projects remain on paper, their centrality in China’s foreign policy necessitates Israel’s awareness of and monitoring of their development. Xi Jinping invited Israel to “take an active part in the GDI” in a conversation with President Isaac Herzog in November 2021. Jerusalem has yet to respond or take an official stance on the three initiatives. But if it does – or if senior Israeli officials publicly support it – they will join the company of anti-liberal nations who have embraced it, giving China a propaganda win. If Israel joins and is later forced to withdraw, its relations with Beijing will suffer. In comparison, as the only G7 country to join the BRI in 2019, Italy is now looking for a way out, souring bilateral relations with China in the process. At the same time, outright opposition to the initiatives will be perceived as too confrontational. Therefore, Israel’s interest is not to join the GDI or express blanket support for it, but rather to continue project-by-project cooperation with China on development while balancing economic, foreign policy, and security considerations. The GSI, in contrast, is intended to undermine US-led security frameworks. In the Middle East, it may jeopardize the progress of the Abraham Accords and the I2U2 (a minilateral grouping launched in 2022 and comprised of Israel, the US, India, and the United Arab Emirates). Furthermore, given that Beijing is dogmatically biased in favor of the Palestinians and provides Iran with an economic lifeline, international legitimacy, and technological solutions to ensure the regime’s survival, support for the GSI goes against Israel’s strategic interests. Aside from security concerns, Israeli support will be misguided on a normative level. The GSI’s stated support for the UN Charter is a smokescreen for China’s refusal to condemn Russia’s invasion of Ukraine, the most egregious violation of the charter, which Beijing and Moscow justify as a response to “NATO expansionism.” Similarly, the good intentions that pave China’s road to “inter-civilizational dialogue and cooperation” under the GCI erode universal values that underpin human rights, dignity, and freedom from oppression, and reject the foundation of liberal democracies on which countries such as Israel were founded. Just as it is not advisable to sign a contract without thoroughly reading it, Israel should not adopt China’s new initiatives without carefully examining their content and implications.

President Xi Jinping with Indian Prime Minister Narendra Modi

Here be dragons: India-China relations and their consequences for Europe

by Manisha Reuter , Dr. Frédéric Grare

The border standoff between China and India illustrates the growing rivalry between the two countries – and the part that other major powers play in it On 27 April, the defence minister of India, Rajnat Singh, met his Chinese counterpart, Li Shangfu, on the margins of the Shanghai Cooperation Organisation (SCO) Defence Ministers Meeting in Delhi. The meeting was yet another attempt to find a way out of the three-year-long standoff between thousands of soldiers along the disputed border, which began in May 2020 when Indian and Chinese forces clashed in the Galwan Valley, killing 20 Indian soldiers and an undisclosed number of Chinese ones. Since then, officials from both countries have met for 18 rounds of talks to try to agree on a disengagement of troops from the area with no success. India has blamed China for unilaterally trying to move the border by sending troops beyond the Line of Actual Control (LAC) between the countries. While it is in both China’s and India’s interest to settle the dispute, Beijing seems unwilling to engage in actual negotiations about the LAC, instead expressing hope that the two sides could move on from the issue and strengthen their mutual trust.   India’s and China’s dispute along the border is illustrative of the growing rivalry between the two countries, which is shaping the security landscape and strategic environment of South Asia. China is gaining power and influence in the Indo-Pacific – where India has long been the dominant power – and using it as yet another arena for its strategic rivalry with the United States. Given Europe’s trade with the region and the complex interplay of relations between China, the US, India, Russia, and the European Union, this dynamic will have severe consequences not just for the region, but for Europe as well. Beijing has tightened its grip over the entire Indian Ocean region in the past two decades. It has created a network of military and commercial facilities – the so-called string of pearls – and strengthened its economic relations with countries of the region. In 2022, Sri Lankan debt obligations to China rose to $7 billion, while the Maldives owes some 40 per cent of its GDP to China. These economic dependencies have eroded India’s influence in its immediate neighbourhood. New Delhi had built up strong diplomatic ties with other countries in the region through its “island diplomacy” and initiatives such as the Security and Growth for all in the Region maritime cooperation. China’s investment in the region has now pushed New Delhi into an economic competition which it may ultimately have difficulties sustaining. New Delhi still exerts a dominant role in South Asia and, specifically, the Indian Ocean, but as China consolidates its position in the region, its attitude towards India has become more assertive. India remains resolute about preventing Chinese hegemony in Asia, repeatedly stressing that a multipolar world starts with a multipolar Asia, and seeking partnerships with a variety of countries, including the US and the EU. Beijing is concerned about India’s growing military ties with the US and tends to consider India’s intentions through the lens of its own rivalry with the US. India’s inability to push back China at the border also further diminishes New Delhi’s influence over the smaller regional states, namely Bangladesh, Nepal, Bhutan, and even the Maldives, by absorbing the financial, military, and administrative resources that could be spent on expanding India’s footprint in the region. It also poses questions about India’s relative power and its ability to protect smaller neighbouring countries from Chinese coercion. This leaves New Delhi even more isolated in the region that includes its arch-rival Pakistan. Both India and China insist that they want to rebuild trust but they cannot agree on the process. Because it currently has the upper hand, China would like trust building to remain a strictly bilateral matter and does not want organisations such as the G20 and the SCO, the other three BRICS states – Brazil, Russia, and South Africa – or even the ASEAN-led institutions to play any role in the so far hypothetical normalisation process. In doing so, China challenges India’s multilateral aspirations and de facto reduces New Delhi’s capacity to manage collectively the consequences of China’s rise for itself and the region. The war in Ukraine makes this even easier as Russia, traditionally on India’s side in multilateral regional arrangements, seems distracted and neutralised by its new, albeit uneasy, proximity to China. The escalating tensions and aggression since 2013 are therefore no coincidence. Beijing’s coercion on the border and naval build-up in the Indian Ocean force India into a costly arms race and warn it against what Beijing considers excessive proximity to the US. In the ongoing great power competition between China and the US, every issue becomes a zero-sum game. This makes it harder for India to solve its border conflict with China and at the same time manage China’s rise and growing assertiveness in the Indo-Pacific region in a peaceful manner. Strengthening India’s position in South Asia and the Indian Ocean region is in line with Europe’s own interests in free trade and supply chain resilience, as well as sustaining a multipolar world order – one in which countries’ political decision-making is not restricted by their economic dependency on China. In this regard, India should play a crucial role in the EU’s diversification and de-risking strategy. The Indo-Pacific region accounts for 40 per cent of the bloc’s extra-EU imports and 27 per cent of its total exports, most of which are sea-borne. As such, the Indian Ocean is Europe’s primary gateway to the Indo-Pacific region. China and India may be slowly but effectively moving towards a new phase of antagonistic rivalry. While the prospect of open confrontation remains only a distant possibility, further polarisation of India-China relations in the Indian Ocean is a problem not only for India, but also for Europe. The EU declared India a priority partner in its 2021 Indo-Pacific strategy, but its relationship with New Delhi has long been characterised as not living up to its full potential. Europe’s growing disillusionment with China over the past two years has shown the need and prepared the ground to further strengthen relations with India. The EU should prioritise the establishment and implementation of  the EU strategy for cooperation in the Indo-Pacific, the EU-India free trade agreement, the Trade and Technology Council, and the Connectivity Partnership to demonstrate its commitment and effectively move beyond symbolic cooperation with India.

Chinese diplomats meeting with US representatives

Where is US’s China policy headed?

by Manoj Joshi

The escalating geopolitical competition has placed the US and China at odds. Both sides need to stabilise their relationship given the role they play in world affairs. US National Security Advisor, Jake Sullivan, met for over eight hours over two days last week with Chinese Communist Party Politburo Member and Director of the Office of the Foreign Affairs Commission, Wang Yi, in Vienna. The meeting, which had not been publicised by either side before the talks, has been seen as a part of an effort by both countries to stabilise their relationship which is perhaps at its lowest level in recent decades. Both sides have been locked in a steadily escalating geopolitical competition, even as they have close and intense economic linkages and a joint interest in dealing with several global and regional affairs. They are locked in opposing sides on issues like Ukraine and Taiwan, and a slow-motion decoupling as US companies diversify away from China and earnings of US companies in China are falling. Both sides used identical language to describe the outcome of the meeting. A White House readout noted that the talks featured “candid, substantive and constructive discussions on key issues of US-China bilateral relationship, global security matters, Ukraine and Taiwan. A Chinese readout used the same terms “candid, in-depth, substantive and constructive discussions” on ways to “remove obstacles in the US-China relationship and stabilise the relationship from deterioration.” Wang laid out the Chinese position on Taiwan, Ukraine and other regional issues. Speaking on background, a US official said that both sides saw the balloon incident as being “unfortunate” and were now looking to “re-establish standard, normal channels of communications.” Two days before the Sullivan-Wang meeting, US Ambassador Nicholas Burns met China’s Foreign Minister Qin Gang in Beijing. According to Qin, a series of “erroneous words and deeds” by the US had put the relationship between the two powers on “ ice” but stabilising ties was the top priority for both countries. Burns said that he and Qin had discussed “challenges in the US-China relationship” and the necessity of “stabilising ties.” The US is in a delicate balancing act with regard to its China policy. In recent years, American policy has shifted from engagement to competition and even containment. In the wake of the US-China trade war, and the first wave of US technology restrictions on Chinese firms like Huawei, there was talk of a “decoupling” of the two economies. The Chinese crackdown in Hong Kong and the post-Pelosi visit tensions over Taiwan have deepened the divide between the world’s two foremost powers. In 2021, Biden had told Xi of the need “to establish some common-sense guardrails” to ensure that the two do not get into an inadvertent conflict. Last November following their summit meeting in Bali, Biden said that “I am not looking for conflict, I’m looking to manage this competition responsibly” At the meeting, Xi called Taiwan “the first red line” that must not be crossed in China-US relations. This was to be followed by a visit of US Secretary of State Antony Blinken to Beijing, but that was called off last minute because of the balloon episode. Blinken met Wang at the Munich Security Conference later in February, but there was little forward movement. It may be recalled that last October, the US government put in place extensive new restrictions on China’s access to advanced semiconductors and the equipment used to make them. These restrictions were layered upon earlier decisions to restrict semiconductors to entities like Huawei and ZTE. Earlier this year, the US further tightened restrictions on the export of semiconductor manufacturing equipment to China. It coordinated with the governments of the Netherlands and Japan to tighten the guidelines. More recently, it has made it clear that it will restrict the actions of chipmakers who get funds under the CHIPs and Science Act. These restrictions are part of Washington’s effort to secure the supply of components that are needed for AI and supercomputers, as well as everyday electronics. In March came harsh signals from China. Speaking in March, President Xi Jinping for the first time named the US and said that it was in a policy of “comprehensive containment, encirclement and suppression against us.” The next day, the new Foreign Minister Qin Gang was more explicit. He slammed the US for equating the Ukraine issue with Taiwan and said that the “so-called ‘competition’ by the US is all-round containment and suppression a zero-sum game of life and death.” He warned that if the US “does not hit the brakes and continues to speed down the wrong path, no amount of guardrails can prevent derailing, and there will surely be conflict and confrontation.” In April, senior American officials have been trying to calm the turbulent waters. Last month, speaking at Johns Hopkins University, US Treasury Secretary Janet Yellen said that decoupling would be “disastrous” and that US goals relating to national security were not aimed at stifling China. She called for a plan of “constructive engagement” with three elements—national security of the US and its allies; an economic relationship based on “fair” competition; and cooperation on urgent global challenges. The Yellen speech was a comprehensive take on US approaches to China and struck what The New York Times said was a “notably positive tone” after months of tensions between the two countries. A week later, the tenor of her remarks was underscored by the National Security Advisor, Jake Sullivan at a speech at the Brookings Institution. Sullivan used the term “de-risking”, a term used earlier by EU Commission President Ursula von der Leyen: “We are for de-risking and diversifying, not decoupling,” he noted. Sullivan had earlier described the US policy of technology restrictions on China as creating a “small yard, with a high fence.” Now officials like Blinken, Yellen, Commerce Secretary Gina Raimondo and Secretary of Defence Lloyd Austin are trying to schedule meetings with their counterparts, but the going has been tough. According to Financial Times, the Chinese are reluctant to have Blinken visit because they were worried that the FBI may release the report based on the salvaged debris of the balloon. As for Austin, the problem is that his newly appointed counterpart General Li Shangfu is under US sanctions since 2018 in relation to Chinese imports of Russian arms when he was serving as a general. The US says that a meeting in third countries would not be affected by the sanctions, but it is unlikely that the Chinese will agree. General Li was appointed defence minister in March. With the tightening of the Western alliance in the wake of the Ukraine war, the US has sought to incorporate the European Union into its China project. Shortly after his three-day visit to China, French President Emmanuel Macron said in reference to Taiwan that Europe should not get caught up in crises “that are not ours”. Europe should try to be the “third pole” in the world order and that the need for Europe’s “strategic autonomy” was now accepted. But Washington points to a 30 March-speech by European Commission President Ursula von der Leyen where she said that it was neither viable nor in Europe’s interest to decouple from China, adding “We need to focus on de-risking—not decoupling.” She added in blunt language “The Chinese Communist Party’s clear goal is a systemic change of the international order with China at its center.” She added that it was there was a need for European companies to ensure that their “capital, expertise and knowledge are not used to enhance the military and intelligence capabilities of those who are also systemic rivals.” Just how much of the messaging from the US about the China relations is sincere, and how much of it is aimed at reassuring nervous allies who feel that Washington’s policies could have a negative impact on them is not clear. But Washington’s agenda remains clear. Speaking last week in Japan, where she is attending the meeting of G7 finance ministers, Yellen called for “coordinated action” by G7 nations against Chinese use of “economic coercion” against other countries. She also said that Washington has been considering the imposition of additional “narrowly targeted restrictions on outbound investment to China,” and that these have been discussed with other G7 partners. She said these would be targeted at technologies “where there are clear national security implications.” But as of now, it does appear as though the two sides are trying to create what David Ignatius called “a framework for constructive engagement.” There is some optimism arising from the detailed discussions that Sullivan and Wang held in Vienna which, as we note were described by both as “candid” and “constructive”. Both sides perceive the need to stabilise their relationship given the role the two countries play in world affairs. With the US going into election mode, it is not clear how long this period where the two sides are trying to work out a new modus vivendi will last. Engagement with China could become a political liability in the US where, if there is consensus on one issue, it is that of a hardline on China. World and New World Journal does not take positions on policy issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of World and New World Journal. 

Joe Biden holding hands with Chinese President Xi Jinping

Biden’s ‘de-risk’ from China policy has a few flaws

by Nathaniel Sher

In order to ‘walk, chew gum, and play chess’ at the same time, the US will have to both invest at home and sign more trade deals. A speech late last month by Jake Sullivan, President Biden’s national security adviser, on “Renewing American Economic Leadership” clarified that the administration wants to build resilience to “de-risk” from China. But dealing with Beijing will require more than investing at home. Washington also needs to re-engage in negotiations with China to manage difficulties in the bilateral relationship. And to better compete, the United States should get back into the business of signing trade deals. As Trade Representative Katherine Tai quipped during her 2021 confirmation hearing, the United States can “walk, chew gum, and play chess” at the same time. The Biden administration should not only invest in domestic resilience, but also participate in new trade agreements and negotiate directly with Beijing. Over the past two years, China joined the Regional Comprehensive Economic Partnership (RCEP), began acceding to the Digital Economy Partnership Agreement (DEPA), and applied to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). China’s integration into these new frameworks will create efficiencies in its own economy, while binding Beijing closer to the rest of Asia. Meanwhile, the United States does not expect to see the first “real outcomes” from the Indo-Pacific Economic Framework (IPEF) until the end of 2023, more than one year after its announcement. IPEF, moreover, lacks the market-access agreements characteristic of other, more substantive economic agreements. It is not surprising, then, that the 2023 Lowy Institute Asia Power Index ranks China 100 out of 100 on its “economic diplomacy” index, while the United States receives a ranking of only 34.6. The 2023 State of Southeast Asia survey similarly shows that only 21.9 percent of respondents view the United States as a leader in championing free trade, down from 30.1 percent in 2022. To be fair, Beijing has significant ground to cover before its markets become as free and as open as those in the United States. What many trade partners care about, however, is not where China and the United States have been, but where they are going. To many, it appears as if Washington is turning inward while Beijing continues to open its markets. This leads to the second error in Jake Sullivan’s “new consensus” on international economic policy. He expresses fatalism about China’s economic trajectory without giving credence to the possibility that China may change, or that the United States can play a role in influencing Beijing’s behavior. Sullivan explains, when “President Biden came into office, we had to contend with the reality that a large non-market economy had been integrated into the international economic order in a way that posed considerable challenges.” In response, Sullivan focuses on building domestic “resilience” and “capacity” to reduce America’s dependence on China. Washington appears to have given up on addressing the non-market practices contributing to U.S. dependence on China in the first place, including state subsidies and dumping. The administration also seems to have forgotten that access to low-priced imports is an important factor in the competitiveness of U.S. firms and the standard of living of American consumers. Fatalism about China’s trajectory tracks with the Biden administration’s overall Indo-Pacific Strategy, which does not seek to “change the PRC but to shape the strategic environment in which it operates.” Fortunately, Treasury Secretary Janet Yellen has bucked the trend by stating that she hopes to “engage” with Beijing “in an important and substantive dialogue on economic issues.” Not trying to influence Beijing, on the other hand, would give up an essential element of any effective China policy. Of course, prior negotiations were by no means unqualified successes. The Trump administration’s “phase one” trade deal largely failed to change Beijing’s behavior, in part, because the bilateral purchase agreements effectively, as Yukon Huang and Jeremy Smith of the Carnegie  Endowment for International Peace put it, “prescribed state-managed trade over market forces.” Other negotiations, however, have seen more success. Former Treasury Secretary Hank Paulson was able to persuade Beijing to revalue its currency by more than 20 percent in the late 2000s, helping to level the trade relationship. China’s WTO accession negotiations also moved the needle on the country’s economic policy. While Beijing failed to carry out many of its WTO commitments, China did reform key aspects of its economy and, notably, slashed its average tariff level from 15.3 percent in 2001 to 9.8 percent over the next decade. U.S. policymakers should learn the lessons of past negotiations rather than standing by as U.S.-China economic relations deteriorate further. One way to pressure Beijing to continue along the path of reform and opening up would be to carry out negotiations in concert with U.S. friends and allies. The Trump administration gave up significant leverage by dealing with Beijing bilaterally, outside the parameters of the international trade system. Plurilateral negotiations with U.S. partners — many of whom share U.S. grievances — may be more effective at convincing China to change course. The consequences of not having an effective economic dialogue with Beijing will become more apparent over time. Despite Washington’s wishes, China is simply not going away. Beijing will continue to join new trade agreements and integrate itself deeper into the global economy, even as the United States focuses on building resilience at home.

Set of different Creative Country labels. Made In Badges With Flags. Vector illustration

Why France and Germany will not ‘decouple’ from China

by Genevieve Donnellon-May

With China increasingly assertive in pursuing its economic and geopolitical interests abroad, US–China tensions are rising, leading many traditional American allies to consider following Washington’s lead in pursuing economic ‘decoupling’ from China. Their strategy aims to reduce economic reliance on China through extensive export controls and re-ordered supply chains. Yet in Western Europe, France and Germany are showing an unwillingness to join their allies in decoupling from China. French President Emmanuel Macron’s recent comments that Europe should not get ‘caught up in crises that are not ours’ demonstrate this. If anything, their relationship with Chinese capital is thriving. China is one of France and Germany’s major trading partners outside of the European Union and a significant export market for goods such as luxury goods and pharmaceuticals. Exports to China made up 7.4% of Germany’s total exports and 4.21% of France’s in 2019, with these numbers growing over the last three years to record levels. Given China’s growing middle class, the country presents an enormous potential consumer market in years to come. According to recent reports, France’s bilateral trade in goods with China exceeded US$100 billion for the first time in 2022, an increase of 14.6% on 2021­. The recent signing of 18 cooperation agreements by 46 French and Chinese companies across numerous sectors further emphasises the gathering pace of these trade relationships. As for Germany, its total trade with China saw an increase of 21% from 2021. While exports increased by a modest 3.1%, Germany’s imports from China accounted for much of the growth, soaring by more than a third. Specifically, Germany imports from China about two thirds of its rare earth elements, many of which are indispensable in batteries, semiconductors, and magnets in electric cars. This shows that Germany and France will rely more on China as time passes for the critical raw materials needed to fuel their economic growth and energy transitions. Furthermore, various French and German companies would prefer to grow their established production facilities and extensive sales networks in China. With the trade relationship expanding so rapidly and estimates suggesting that more than 2 million German jobs depend on exports to China, the countries’ economies are set to become even more intertwined. German companies Volkswagen and chemical processor BASF, for instance, are significantly expanding their investments in China. Volkswagen, which already has more than 40 plants in China, recently announced that it will invest billions in new local partnerships and production sites. BASF, which has 30, says it will invest US$10.9 billion in a new chemical production complex there. Given all this new activity, making a show of decoupling from China could cause significant repercussions for France and Germany. Ultimately, the costs of decoupling outweigh the benefits for the two governments. While their allies might come to bemoan their inaction, they just won’t forgo such significant opportunities for French and German companies in China. Additionally, decoupling could trigger retaliation, as it did with Australia, with China halting exports to the two countries, increasing tariffs, or reducing market access to French and German goods. All in all, France and Germany are unlikely to shift from their stance. They’d prefer to let their markets flourish and work out the rest later.