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About Chellaney

Professor, strategic thinker, author and commentator

Why Mike Pence is playing bad cop against China

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As the trade war escalates, Donald Trump is seeking to preserve space for a possible deal and leaving his deputy to tackle the tough questions.

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Brahma Chellaney, The National

After a landmark speech this month at the Hudson Institute, which signalled a fundamental shift in America’s China policy, Vice President Mike Pence will lead a US delegation to three important multilateral summits in November. While President Donald Trump has lavished praise on China’s President Xi Jinping despite their escalating trade war, Pence is leading the administration’s charge against China.

Mr Trump and Mr Pence might, in fact, be playing a deliberate game of good cop, bad cop.

Mr Trump’s handling of China reflects his reluctance to antagonize Mr Xi or impose sanctions on China even in response to egregious human-rights abuses, including its internment of up to one million Muslims from Xinjiang. Had Russia set up such camps, the US response would likely have been swift and resolute.

The US president is a great believer in the idea that a good rapport between heads of government can significantly shape the relationship between the countries they lead. He also prides himself on being a great negotiator and deal-maker.

While letting his vice president forthrightly articulate America’s concerns over China, Mr Trump is seeking to preserve space to cut a possible deal with Mr Xi on trade. Mr Trump and Mr Xi, in their first face-to-face interaction in nearly a year, are likely to meet on November 29 in Buenos Aires, a day before the G20 summit opens there.

In his recent speech, Mr Pence highlighted how China is blending economic aggression, territorial and maritime revisionism, military adventurism, influence operations and Orwellian repression at home to advance its ambitions.

More importantly, Mr Pence declared that “the US has adopted a new approach to China”, saying that “previous administrations all but ignored China’s actions. And in many cases, they abetted them. But those days are over.”

The speech laid out why the Trump administration is making a course correction in the China policy that successive American presidents have pursued since the early 1970s, when the US managed the diplomatic coup of splitting its two main enemies – the Soviet Union and China. With the US winning over China to its side, it became two against one. This proved a critical factor in the eventual US victory in the Cold War and the Soviet Union’s collapse.

In return, the US actively aided China’s rise. After Deng Xiaoping emerged as China’s paramount leader in 1978, following a fierce power struggle, and embarked on economic modernisation, the US lent full support to his mission.

The US policy of assisting China’s economic ascent did not change even in response to the 1989 Tiananmen Square massacre. There, Chinese authorities used tanks to ruthlessly crush student-led protests in the heart of Beijing – an action that left hundreds, possibly thousands, dead.

But now the Trump administration has unveiled a new strategy to shift the US relationship with China from co-operation to competition, including confronting Chinese mercantilism and Beijing’s campaign of influence operations on American soil.

As Mr Pence put it, the US miscalculated that after the fall of the Soviet Union, “a free China was inevitable”. Today, according to him, an increasingly authoritarian and aggressive China has “mobilised covert actors, front groups, and propaganda outlets to shift Americans’ perception of Chinese policy … what the Russians are doing pales in comparison to what China is doing across this country”.

Against this backdrop, it might seem appropriate that Mr Trump is sending the blunt-speaking Mr Pence in his place to the forthcoming multilateral summits in the Indo-Pacific region − the East Asia Summit (EAS) and the US-Asean summit, both to be held in Singapore in mid-November, followed by the Asia Pacific Economic Cooperation (APEC) group summit at Port Moresby, Papua New Guinea, on November 17-18.

APEC summits, instituted in 1993, have become largely symbolic, and Mr Trump’s absence at Port Moresby will not be unusual. Bill Clinton missed two summits and Barack Obama skipped one. As APEC’s membership has expanded, the grouping’s cohesiveness and mission have weakened.

The promise of the 18-nation EAS has also faded. Like the 21-nation APEC, the EAS includes America’s main geopolitical rivals, China and Russia.

In this light, to counter the rise of an increasingly muscular China that refuses to play by international rules, substance matters more for US policy than group photographs at multilateral summits.

It is significant that, in an otherwise polarised and divided Washington, a bipartisan consensus is emerging that the failed US policy of “constructive engagement” with China must be replaced with concrete counteraction.

For example, in a Harvard University essay this month, Obama’s defence secretary, Ashton Carter, writes: “Washington since the end of the Cold War has often backed down in the face of Chinese bullying. From aggressive territorial claims to human-rights abuses and brazen theft on a trillion-dollar scale, China has violated core international norms time and again with little repercussions beyond scolding American speeches”.

Mr Carter recommends that, “when China behaves inappropriately on the international stage, the US must firmly push back and stand up for the principles of international order”. Mr Pence has signalled that this is precisely what the Trump administration intends to do.

Brahma Chellaney is a geostrategist and the author, most recently, of the award-winning Water, Peace, and War.

© The National, 2018.

Maldives: India should not rest on its oars

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Brahma Chellaney, The Hindustan Times

Following President Abdulla Yameen’s surprise defeat in the Maldivian election, the air of self-congratulation that pervades in New Delhi risks obscuring the challenges. India ought to learn from its experience with Sri Lanka, where China has retained its influence and leverage even after authoritarian President Mahinda Rajapaksa was thrown out by voters in early 2015. In the Maldives, China may be down, but it’s not out and could, as in Sri Lanka, re-establish its clout through debt-trap diplomacy.

The Maldivian archipelago, despite its tiny population, is of key importance to Indian security, given that it sits astride critical sea lanes through which much of India’s shipping passes. From the Indian naval station on the Lakshadweep island of Minicoy, the Maldives’ northernmost Thuraakunu Island is just 100 kilometers away.

The election victory of opposition candidate Ibrahim Mohamed Solih against an increasingly autocratic Yameen cannot by itself roll back the deep strategic inroads China made during the incumbent president’s rule. To be sure, the outcome represents a triumph of Indian patience. Had India militarily intervened in the Maldives, it could have provoked a nationalistic backlash and strengthened Islamist forces in a country that has supplied the world’s highest per-capita number of foreign fighters to terrorist groups in Syria and Iraq.

After Yameen in February declared a state of emergency and jailed Supreme Court justices and political opponents, India came under pressure, including from the Maldivian opposition, to intervene militarily, as it did once before — in 1988 when it foiled an attempted coup. But unlike in 1988, no legitimate authority was inviting India to send in forces. By erring on the side of caution, and by holding out an intervention threat if the voting were not free and fair, India aided the electoral outcome.

Contrast this with Indian missteps in Nepal, where India woke up belatedly to the political machinations in Kathmandu that led to a flawed new Constitution being promulgated. India then backed the Madhesi movement for constitutional amendments — an agitation that triggered a five-month border blockade of essential supplies to Nepal. The resulting Nepalese grassroots backlash against India eventually contributed to the China-aided communists sweeping Nepal’s 2017 elections.

The restoration of full democracy in the Maldives after, hopefully, a smooth transfer of power on November 17 will be a diplomatic boost for India. However, in India’s larger strategic backyard, China continues to systematically erode Indian clout. Indeed, the Maldivian election result coincided with a major development underscoring Nepal’s pro-China tilt. After implementing a transit transport agreement with China to cut dependence on India, communist-ruled Nepal — under Chinese pressure — has reversed its previous government’s cancellation of the $2.5 billion Budhi-Gandaki Dam project. China bagged the project without competitive bidding. It massively inflated the project cost, which will leave Nepal struggling to repay the Chinese debt.

Yameen, who signed major financing and investment deals with Beijing, will be departing after pushing the Maldives to the brink of a Chinese debt trap. Can the Maldives still escape debt entrapment by emulating the example set by Malaysia’s Mahathir Mohamad, who recently cancelled Chinese projects worth almost $23 billion? Or is the Maldives, like Sri Lanka, already so indebted that it will remain under China’s sway? Nearly 80% of the Maldives’ external debt — equivalent to about one-quarter of its GDP — is owed to China.

Even without any new contracts, the Maldivian debt to China will rise because of the Chinese projects already completed or initiated, thus allowing Beijing to retain its favourite source of leverage. Indeed, Beijing will seek to court Yameen’s successor just as it has in Sri Lanka wooed Rajapaksa’s successor, who has disclosed that China has “gifted” him $300 million “for any project of my wish,” besides constructing South Asia’s largest kidney hospital in his electoral district.

In this light, the post-Yameen Maldives — like Nepal, Bangladesh and Sri Lanka — would likely seek to balance relations with India and China, thus reinforcing how Beijing has fundamentally altered geopolitics in a subregion New Delhi long considered its natural sphere of influence. As Maldives’ closest partner, a proactive India must leverage its ties. India should assist in infrastructure development and be willing to refinance Maldives’ Chinese debt so as to achieve lower costs and a longer-term maturity profile.

India will have to closely watch China’s activities in the unpopulated Maldivian islands it managed to lease during Yameen’s reign. China is muscling its way into India’s maritime backyard, including sending warships to the Maldives and signing an accord for an ocean observatory there that could provide critical data for deploying Chinese nuclear submarines. The new Maldivian government should be left in no doubt about India’s “red lines”.

Brahma Chellaney is a geostrategist and author.

© The Hindustan Times, 2018.

China’s Imperial Project Runs into Resistance

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By Brahma Chellaney, Washington Times
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Grand on ambition but short on transparency, Chinese President Xi Jinping’s marquee project, the Belt and Road Initiative (BRI), seeks to refashion the global economic and political order by luring nations desperate for infrastructure investments into China’s strategic orbit. The BRI is essentially an imperial project aiming to make real the mythical Middle Kingdom.

The BRI, rolled out in 2013, attracted many countries, as China offered to finance and build major infrastructure projects, including ports, highways, energy plants and railroads. But after a smooth sailing, the BRI is now encountering strong headwinds, as partner-countries worry about China ensnaring them in sovereignty-eroding debt traps.

China has extended huge loans to financially weak states, only to strengthen its leverage through debt entrapment Indeed, Beijing has converted big credits not just into political influence but also a military presence, as its first overseas naval base at Djibouti illustrates.

Malaysian Prime Minister Mahathir Mohamad, with Chinese Premier Li Keqiang by his side in Beijing’s Great Hall of the People, recently criticized China’s use of infrastructure projects to spread its influence. By warning China against “a new version of colonialism,” Mr. Mahathir highlighted international concerns over Beijing’s use of geo-economic tools to achieve geopolitical objectives.

A number of countries have now begun trying to renegotiate their deals with Beijing. Some have also decided to scrap or scale back BRI projects. Mr. Mahathir, during his Beijing visit, announced cancellation of Chinese projects worth nearly $23 billion.

BRI seeks to export China’s model of top-down, debt-driven development through government-to-government deals. Vulnerable countries are now awakening to the risks of accepting loans that could financially shackle them to Beijing.

Last December, China acquired the strategic Indian Ocean port of Hambantota on a 99-year lease after the small island nation of Sri Lanka could no longer keep up with debt repayments.

In fact, China is even replicating some of the practices that were used against it during the European-colonial period. For example, the concept of a 99-year lease emerged from the flurry of European-colonial expansion in China in the 19th century.

While rates for Japan’s infrastructure loans usually run below half a percent, China offers BRI loans at rates as high as 7 percent, which can place unsustainable financial strain on small countries. For example, China’s renegotiated Hambantota port loan to Sri Lanka carries a 6.3 percent fixed rate. In China’s client state, Pakistan, Chinese state companies have secured energy contracts that guarantee 16 percent or more yearly returns, in dollar terms.

China has faced accusations in multiple countries of illegally funneling money to authoritarian presidents.

In the Maldives, China has managed to acquire several islets in that heavily indebted Indian Ocean archipelago. Mohamed Nasheed, the nation’s first democratically elected president who was ousted at gunpoint in 2012, said, “Without firing a single shot, China has grabbed more land in the Maldives than what [Britain’s] East India Company did at the height of the 19th century.”

Against this background, the BRI is beginning to encounter a push-back in a number of countries. A growing number of governments are seeking transparency in Chinese lending, investment and trade practices.

However, the BRI is still bagging new contracts in some other countries. One example is the Himalayan nation of Nepal, which became the world’s sixth Communist-ruled country in February. China helped unite warring Communist factions in Nepal and funded the election campaign. Now Beijing is reaping the rewards.

The new Communist government in Nepal in September reinstated a deal with China for a $2.5 billion dam project that was scrapped by the previous government. China won the contract without an open-bidding process. In fact, it has massively inflated the project cost, which will leave Nepal struggling to repay the Chinese loan.

Laos, another Communist-ruled nation, is also seeking more BRI financing and investment. In continental Southeast Asia, while Myanmar, Thailand and Vietnam are wary of getting too close to China, Laos and Cambodia see BRI as critical to boosting their economic growth.

Yet the international reality is that, after a heady first phase, the pace of new contracts under the BRI has slowed, as concerns spread about China’s debt-trap diplomacy and as heavily indebted nations recoil from accepting more Chinese financing in the form of market-rate loans. This trend is likely to intensify in the next few years.

Even within China, the BRI is facing criticism from those who question the wisdom of plowing hundreds of billions of dollars into overseas projects when the government is still grappling with poverty and underdevelopment in a number of provinces. Critics are concerned that Mr. Xi’s aggressive quest for Chinese dominance is inviting an international backlash. The BRI — the world’s biggest building program, which Mr. Xi has hailed as “the project of the century” — exemplifies how China is flaunting its global ambitions.

Meanwhile, the financial and security risks of Chinese projects in failing or dysfunctional states are becoming more apparent. Take Pakistan, the largest recipient of BRI financing. The Pakistani military has raised a special 15,000-strong force to protect Chinese projects. In addition, thousands of police have been deployed in some provinces to protect Chinese workers. Yet sporadic attacks on Chinese in Pakistan have underscored the rising security costs.

The larger push-back against China’s neocolonial practices is likely to intensify in the coming years, putting greater pressure on the BRI. The initiative, however, will continue to benefit from a U.S.-led sanctions approach that seeks to punish countries in the name of human rights or nuclear nonproliferation. Thanks to this approach, the BRI is still bagging major lucrative contracts in countries as diverse as Iran, Sudan and Cambodia.

• Brahma Chellaney is a geostrategist and the author of nine books, including “Water: Asia’s New Battleground.”

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

No easy escape from Afghan war for Trump

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Russia, China and Iran now backing Taliban and stymieing U.S. peace efforts

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The U.S. will find it difficult to pull out of Afghanistan in the face of increased foreign support for the Taliban.   © Reuters

Brahma Chellaney, Nikkei Asian Review

Not for the first time, the U.S. is showing signs of desperation in trying to end its war in Afghanistan, by renewing efforts for a peace deal with the Taliban and — yet again — reviewing combat strategy.

Ending the longest war in American history, which marks its 17th anniversary on Oct. 7, appears integral to President Donald Trump’s broader plan to roll back America’s “imperial overreach” — the phenomenon of a great power going into decline when it takes on excessive global commitments.

In contrast to China’s use of economic tools to achieve strategic objectives, the U.S. has too often reached for the gun instead of the purse. Many in Washington now believe U.S. retrenchment must include staying out of faraway wars and making allies pay their fair share for defense.

In the summer of 2017, the Trump administration ended the CIA’s covert operations to train and arm rebels in Syria — a large-scale program that had begun under Trump’s predecessor, Barack Obama. Ironically, it was Obama who in 2013 underscored the danger of perpetual war for U.S. power by recalling the warning of America’s fourth president, James Madison, that “no nation could preserve its freedom in the midst of continual warfare.”

Today, extricating the U.S. from the military quagmire in Afghanistan is seen as important to reversing America’s relative decline, including focusing on domestic renewal. A year ago, Trump acknowledged that his “original instinct was to pull out” but that he had been convinced that “a hasty withdrawal would create a vacuum for terrorists, including ISIS and al-Qaida.” Now, with U.S. patience wearing thin, his administration has stepped up efforts to end the war.

But international geopolitics promises to play spoilsport. U.S. foreign policy, through punitive sanctions and tariffs, is driving Russia, China and Iran to support the Afghan Taliban in a bid to tie down American forces in Afghanistan. Pakistan, which provides cross-border safe havens to America’s main battlefield foe, the Afghan Taliban, seems intent to continue running with the hare and hunting with the hounds — pretending to be a U.S. ally while harboring the Taliban’s network structure.

To make matters worse, an ascendant Afghan Taliban is expanding its territorial control and killing government forces in such record numbers that authorities in Kabul no longer disclose fatality tolls. Afghan military casualties have been rising since 2014, after U.S. forces transferred responsibility for most security to the Afghans. According to one estimate, the daily fatality toll among Afghan security forces has jumped from 22 in 2016 to about 57 recently. Both Kabul and Washington now admit that Afghan casualties have risen to unsustainable levels.

About 14,000 American troops remain in Afghanistan, including 4,000 added by Trump, plus some 26,000 American military contractors.

Trump, instead of the promised fundamentally different approach, is now seeking to essentially repeat Obama’s failed effort — to cut a deal with the Afghan Taliban, for which the U.S. needs the full backing of Pakistan’s powerful generals. To win their support, the U.S. has assassinated three successive chiefs of the Pakistani Taliban, a group that poses no real threat to American forces but is the nemesis of the Pakistan military.

After the latest killing in May, which came about four months after Washington cut most security assistance to Pakistan, the U.S. held face-to-face talks in July with the Afghan Taliban in Qatar.

The Obama administration first sought to make Qatar’s capital, Doha, a negotiations hub by allowing the Afghan Taliban to establish a de facto diplomatic mission there in 2013.

To preserve the option of reaching a Faustian bargain with the Afghan Taliban, the U.S. has not included the militia in its list of foreign terrorist organizations. And the only time the U.S. has assassinated a major Afghan Taliban leader inside the militia leadership’s sanctuary, Pakistan, was in 2016 when a drone strike killed the new chief after he adamantly opposed any peace talks.

U.S. Defense Secretary Jim Mattis, while making an unannounced visit to Kabul recently on his way back from New Delhi, said reconciliation efforts with the militia had gained “traction.”

But the Taliban, while valuing direct talks with the U.S. as a means to undercut the Afghan government’s legitimacy, have little incentive to make peace with America. The Taliban have gained the momentum against regime forces, which are spread thin and on the defensive. Taliban battlefield victories are denting government morale and making it less likely that the insurgents will agree to a deal.

Washington, in response to the increasing Taliban attacks, has advised Afghan troops to pull back from vulnerable outposts and focus on safeguarding cities. Making force protection the priority clearly signals a government in retreat.

Further emboldening the Taliban is new support from Russia, Iran and China. With U.S. sanctions hurting the Iranian and Russian economies and Trump’s trade war against China potentially laying the foundation of a new Cold War, Tehran, Moscow and Beijing are opportunistically seeking to use the Taliban as a tool to step up pressure on the U.S.

The revival of the “Great Game” — the 19th-century Anglo-Russian rivalry for Central Asian influence — makes it harder to pacify war-torn Afghanistan. Behind the changed geopolitics is a major role reversal.

In the 1980s, U.S. President Ronald Reagan used Islam as a tool to spur resistance to the Soviet occupation of Afghanistan, with the CIA arming thousands of Afghan mujahedeen — violent jihadists that later spawned al-Qaida and the Taliban.

Moscow and Tehran long viewed the Taliban as a major terrorist threat and aided the 2001 U.S. overthrow of the five-year-old Taliban regime. But now Russia and Iran are seeking to assist the Taliban against the shaky, U.S.-backed Kabul government.

Meanwhile, China has long had a dubious approach toward the militia. On the day of the 2001 New York World Trade Center terrorist attack, a Chinese delegation signed an economic and technical cooperation agreement with the isolated Taliban regime in its de facto capital, Kandahar.

Seeking a bigger role in Afghanistan, China is again courting the Taliban. It has received Taliban delegations in recent years and offered to mediate peace talks. The Taliban has promised not to attack China’s much-delayed, $3 billion project to mine huge copper deposits at Mes Aynak, near Kabul.

India, a top aid donor to Afghanistan, has pursued a consistently anti-Taliban policy. Despite its warming ties with Washington, India is concerned that U.S. direct talks with the Taliban could lend respectability to a fanatical terrorist organization.

But the U.S. clearly appears willing, as part of a peace deal, to accommodate the Taliban in an Afghan power-sharing arrangement. But the spoiler roles of Russia, China and Iran and the Taliban’s battlefield successes make such a deal less likely. As American senator John McCain predicted before his death, the conflict in Afghanistan would continue “on a low-burning simmer for a long time to come.”

Brahma Chellaney is a geostrategist and the author, most recently, of the award-winning “Water, Peace, and War.”

The China Backlash

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US President Donald Trump’s headline-grabbing trade war with China should not obscure a broader pushback against the country’s mercantilist trade, investment, and lending practices. In fact, China’s free ride could be coming to an end.

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BRAHMA CHELLANEY, a column internationally syndicated by Project Syndicate

On a recent official visit to China, Malaysian Prime Minister Mahathir Mohamad criticized his host country’s use of major infrastructure projects – and difficult-to-repay loans – to assert its influence over smaller countries. While Mahathir’s warnings in Beijing against “a new version of colonialism” stood out for their boldness, they reflect a broader pushback against China’s mercantilist trade, investment, and lending practices.

Since 2013, under the umbrella of its “Belt and Road Initiative,” China has been funding and implementing large infrastructure projects in countries around the world, in order to help align their interests with its own, gain a political foothold in strategic locations, and export its industrial surpluses. By keeping bidding on BRI projects closed and opaque, China often massively inflates their value, leaving countries struggling to repay their debts.

Once countries become ensnared in China’s debt traps, they can end up being forced into even worse deals to compensate their creditor for lack of repayment. Most notably, last December, Sri Lanka was compelled to transfer the Chinese-built strategic port of Hambantota to China on a 99-year, colonial-style lease, because it could longer afford its debt payments.

Sri Lanka’s experience was a wake-up call for other countries with outsize debts to China. Fearing that they, too, could lose strategic assets, they are now attempting to scrap, scale back, or renegotiate their deals. Mahathir, who previously cleared the way for Chinese investment in Malaysia, ended his trip to Beijing by canceling Chinese projects worth almost $23 billion.

Countries as diverse as Bangladesh, Hungary, and Tanzania have also canceled or scaled back BRI projects. Myanmar, hoping to secure needed infrastructure without becoming caught up in a Chinese debt trap, has used the threat of cancellation to negotiate a reduction in the cost of its planned Kyaukpyu port from $7.3 billion to $1.3 billion.

Even China’s closest partners are now wary of the BRI. In Pakistan, which has long worked with China to contain India and is the largest recipient of BRI financing, the new military-backed government has sought to review or renegotiate projects in response to a worsening debt crisis. In Cambodia, another leading recipient of Chinese loans, fears of effectively becoming a Chinese colony are on the rise.

The backlash against China can be seen elsewhere, too. The recent annual Pacific Islands Forum meeting was one of the most contentious in its history. Chinese policies in the region, together with the Chinese delegation leader’s behavior at the event itself, drove the president of Nauru – the world’s smallest republic, with just 11,000 inhabitants – to condemn China’s “arrogant” presence in the South Pacific. China cannot, he declared, “dictate things to us.”

When it comes to trade, US President Donald Trump’s escalating trade war with China is grabbing headlines, but Trump is far from alone in criticizing China. With policies ranging from export subsidies and nontariff barriers to intellectual-property piracy and tilting the domestic market in favor of Chinese companies, China represents, in the words of Harvard’s Graham Allison, the “most protectionist, mercantilist, and predatory major economy in the world.”

As the largest merchandise exporter in the world, China is many countries’ biggest trading partner. Beijing has leveraged this role by employing trade to punish those that refuse to toe its line, including by imposing import bans on specific products, halting strategic exports (such as rare-earth minerals), cutting off tourism from China, and encouraging domestic consumer boycotts or protests against foreign businesses.

The fact is that China has grown strong and rich by flouting international trade rules. But now its chickens are coming home to roost, with a growing number of countries imposing antidumping or punitive duties on Chinese goods. And as countries worry about China bending them to its will by luring them into debt traps, it is no longer smooth sailing for the BRI.

Beyond Trump’s tariffs, the European Union has filed a complaint with the World Trade Organization about China’s practices of forcing technology transfer as a condition of market access. China’s export subsidies and other trade-distorting practices are set to encounter greater international resistance. Under WTO rules, countries may impose tariffs on subsidized goods from overseas that harm domestic industries.

Now, Chinese President Xi Jinping finds himself not only defending the BRI, his signature foreign-policy initiative, but also confronting domestic criticism, however muted, for flaunting China’s global ambitions and thereby inviting a US-led international backlash. Xi has discarded one of former Chinese strongman Deng Xiaoping’s most famous dicta: “Hide your strength, bide your time.” Instead, Xi has chosen to pursue an unabashedly aggressive strategy that has many asking whether China is emerging as a new kind of imperialist power.

International trade has afforded China enormous benefits, enabling the country to become the world’s second-largest economy, while lifting hundreds of millions of people out of poverty. The country cannot afford to lose those benefits to an international backlash against its unfair trade and investment practices.

China’s reliance on large trade surpluses and foreign-exchange reserves to fund the expansion of its global footprint makes it all the more vulnerable to the current pushback. In fact, even if China shifts its strategy and adheres to international rules, its trade surplus and foreign-currency reserves will be affected. In short, whichever path it chooses, China’s free ride could be coming to an end.

© Project Syndicate, 2018.

Beijing loses a battle in the Maldives — but the fight for influence goes on

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China may be down in the Maldives, but it’s not out

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India must challenge China to help the Maldives retain strategic autonomy. (Source photo by Reuters)

Brahma Chellaney, Nikkei Asian Review

The Indian Ocean nation of the Maldives, comprising 1,190 coral atolls, has been roiled by a deepening national crisis since its first democratically-elected president was forced to resign at gunpoint in 2012.

This week’s surprise defeat of authoritarian President Abdulla Yameen in a national election opens the path to stability and reconciliation under the leadership of the winning opposition candidate Ibrahim Mohamed Solih.

Yameen’s defeat, despite the jailing of opponents and Supreme Court justices and efforts to manipulate the election, shows how autocrats can be swept out of office by a voters’ backlash. And that even in a country with weak democratic traditions.

The Maldives follows Malaysia, where, in May, Prime Minister Najib Razak was voted out and now faces corruption charges under his 93-year-old successor, Mahathir Mohamad. Sri Lanka’s voters in 2015 similarly ended the quasi-dictatorship of President Mahinda Rajapaksa, who curtailed media freedom.

In all three states, China’s shadow loomed large. Yameen signed major financing and investment deals with China and, like Najib and Rajapaksa, is alleged by his opponents to have received Chinese funds for his reelection bid.

While Malaysian investigators are probing whether China helped bankroll Najib’s reelection bid, The New York Times reported in June that the state-run China Harbor Engineering Company allegedly gave $7.6 million for Rajapaksa’s campaign. Rajapaksa and CHEC have denied the claim, but new president Maithripala Sirisena’s government has called for an investigation.

China, Yameen’s main defender, capitalized on its support to expand its influence in the strategic Maldivian archipelago. Yameen, for his part, felt emboldened by Chinese support to crack down on the opposition and undermine national institutions, including the judiciary and the election commission.

With barely 450,000 citizens, the Maldives is tiny but sits astride critical shipping lanes, making it vital to security in the Indian Ocean. Yameen’s rout thus is a setback to China’s maritime ambitions and political influence, and a victory for grass roots democratic forces.

At a time when Beijing is beginning to encounter a wider pushback against its Belt and Road Initiative — an influence-building infrastructure program that can ensnare vulnerable countries in debt traps — the Maldives represents the latest case of a democratic election upending China’s plans. BRI could face speed bumps even in China’s close ally, Pakistan, where the new, cash-strapped government has instituted a review of Chinese projects.

China, however, can take comfort from the formation of a friendly, democratically elected communist government in the Himalayan state of Nepal. In a demonstration of autocratic China’s ability to exploit the openness of a democracy, it helped unite warring communist factions in Nepal and funded their election campaign.

In the Maldives, pressure from democratic powers, including the specter of an Indian military intervention, played a role in the outcome. The U.S. had warned of “appropriate measures” and the European Union had threatened sanctions if the vote was not free and fair. And when Yameen hesitated to concede defeat, Washington demanded he “respect the will of the people,” while India sought to present a fait accompli by being first to congratulate his opponent, Solih. (In the previous election in 2013, Yameen got the Supreme Court to annul the result after he trailed his opponent, forcing fresh polls which he dubiously won.)

India has traditionally viewed the Maldives as in its sphere of influence. So as China began eroding Indian influence by backing Yameen from 2013, concern grew in New Delhi that Beijing could turn one of the unpopulated Maldivian islands it had leased into a naval base, completing a strategic encirclement of India.

Among the islands China has acquired is Feydhoo Finolhu, for which it paid $4 million, less than the cost of a luxury apartment in Hong Kong; another island, the 7km-long Kalhufahalufushi, came even cheaper. China has revealed its strategic intentions by sending frigates to the Maldives.

After Yameen in February declared a state of emergency and jailed Supreme Court justices for quashing convictions against nine jailed or exiled opposition figures, India came under pressure, including from the Maldivian opposition, to intervene militarily, as it did once before – in 1988 when it foiled an attempted coup. The Indian intervention helped President Maumoon Abdul Gayoom to perpetuate his soft autocracy for another two decades.

An intervention this year, however, would have been dicey, not least because no legitimate authority had invited India to send in forces. The intervention could have provoked a nationalistic backlash and strengthened Islamist forces in the Maldives, which has supplied the world’s highest per capita number of foreign fighters to terrorist groups in Syria and Iraq. By correctly erring on the side of caution, India aided this week’s electoral outcome.

The restoration of full democracy in the Maldives, like in Malaysia, bucks an international trend: The global spread of democracy has largely stalled, with liberal forces unable to gain ground in the face of both tightly centralized political systems (as in China) and a revival of authoritarianism (as in Russia). While democracy has become the norm in large parts of Europe, very few Asian states are true democracies.

The return of democracy to the Maldives is especially remarkable as the country has been under authoritarianism for 50 of the 53 years since gaining independence from Britain in 1965. Yameen’s five-year rule marked a shift to hard authoritarianism, with that lurch being accompanied by the rising power of Islamists.

In the latest election, Yameen chose as his running mate a Muslim preacher with close ties to Saudi groups and got support from Jamiyyath Salaf. This extremist organization was one of the Islamist groups behind the 2012 museum attack that erased evidence of the country’s pre-Islamic past by destroying priceless Buddhist and Hindu statues.

The triumph of democratic forces, however, cannot mask the tough challenges that await Yameen’s successor, Solih, including on how to deal with Islamist power and service Chinese debt (which currently equals more than a quarter of the country’s gross domestic product). One key question is whether the Maldives will be able to pull back from the brink of a Chinese debt trap (by emulating the example set by Mahathir, who has canceled Chinese projects) or whether it is so indebted – as Sri Lanka is — that it will remain under Beijing’s sway.

China invested heavily in Sri Lanka during the rule of Rajapaksa, whom it shielded at the United Nations from allegations of war crimes. Sirisena sought to extricate Sri Lanka from the Chinese debt trap, including suspending work on major projects. But it was too late: Saddled with debts his government could not repay, Sirisena was forced to accept Chinese demands, including restarting suspended projects and handing the strategic Hambantota port to China on a 99-year lease.

Under Solih, even without new contracts, the Maldives’ debt to China will rise because of the Chinese projects already initiated. Beijing will court Solih — to be sworn in on Nov. 17 — just as it has wooed Sirisena, who has disclosed that China has “gifted” him $300 million “for any project of my wish,” besides constructing South Asia’s largest kidney hospital in his home district.

To reclaim its influence in the Maldives, India will have to do more than help strengthen the restored democracy; it must assist the new government in infrastructure development and meeting its foreign debt obligations, including by extending low-interest loans to pay off Chinese credits. Escaping debt entrapment is vital for the Maldives to retain strategic autonomy.

Brahma Chellaney is a geostrategist and the author, most recently, of the award-winning “Water, Peace, and War.”

© Nikkei Asian Review, 2018.

India fumbles against a rogue neighbour

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Brahma Chellaney, Mail Today

pakistani-flag-reuetrsPakistan has turned into the Mecca of international terrorism even as its new prime minister, Imran “Taliban” Khan, has promised to make his country a Medina-like welfare state. Pakistan, however, is battling a deepening financial crisis, largely exacerbated by its “all-weather” ally, China. Beijing has imposed unfair deals on, and stepped up capital-goods exports to, Pakistan under its so-called Belt and Road Initiative.

The military-manipulated election that brought Khan to power, instead of providing much-needed stability to Pakistan, is likely to inject more turmoil. A supporter of the military-backed jihadists and a religious zealot himself, Khan in February married his burqa-clad “spiritual guide”, who now also serves as his political guide.

The Pakistani military has waged an undeclared war against India since the 1980s. But now that an internationally isolated Pakistan, with its economy in dire straits, is seeking an international bailout package, the military generals there, for tactical reasons, want “peace” talks with India while remaining engaged in aggression. Through such talks, they also wish to legitimize the government they helped to install.

Yet this is exactly what Prime Minister Narendra Modi risked doing by initially agreeing to a bilateral foreign ministers’ meeting. The meeting, on the sidelines of the UN general assembly, would have represented the first high-level contact between India and Pakistan since early 2016, when talks were suspended after the Pakistan-scripted terrorist attack on the Pathankot air force base. Despite frequent terrorist outrages, such a meeting would have signalled a thaw in Indo-Pakistan relations. Fortunately, the Modi government had the good sense to reverse its decision.

It should not be forgotten that another BJP prime minister, Atal Bihari Vajpayee, legitimized General Pervez Musharraf’s military rule by inviting him out of the blue to a summit in Agra. That summit went badly, but Musharraf came out the clear winner.

The Modi government initially agreed to the foreign ministers’ meeting just after the Pakistani army killed an Indian soldier by sniper fire and then slit his throat and mutilated his body. In fact, such was the bad optics that India was playing a cricket match with Pakistan in Dubai on the day the Pakistani savagery was first reported. Worse still, the timing of the Indian announcement to hold the meeting sent out an unfortunate message — that India, instead of being outraged over the mutilation, was rewarding Pakistan with bilateral discussions. That message was reinforced in the immediate aftermath by the abduction and killing of three cops in Jammu and Kashmir by Pakistan-backed terrorists.

To its credit, the Modi government took barely 24 hours to correct its mistake and scrap the foreign ministers’ meeting. Strong reaction on social media played a role in the quick reversal. But it is apparent that the original decision in favour of the meeting was taken without careful thought. There was no consideration of the fact that such talks would not only be futile but also amount to India playing into Pakistan’s hands.

Indeed, no sooner had India reversed its decision than Imran Khan sought to mock Modi by referring to “small men holding big offices” — a statement that effectively closes the door to any senior-level bilateral talks in the coming months. That reference might more aptly apply to Khan himself. After all, Khan (the Pakistani military’s newest puppet) has long been ridiculed as “Im the Dim” for his lack of intelligence.

Still, the fact is that incompetent officials in New Delhi have seriously embarrassed India through their flip-flop and provided new grist to the Pakistani propaganda mill. For example, the ministry of external affairs cited Pakistan’s glorification of terrorists through new postage stamps as one of the provocations for the Indian U-turn, although these stamps were released before Khan took office.

It is an open secret that Washington has sought to persuade New Delhi to engage with Islamabad. America has stepped up its effort to end its longest-ever war by clinching a peace deal with the Afghan Taliban, for which it needs the Pakistani military’s help. India, in its first bilateral engagement with the Imran Khan government, convened a meeting of the Permanent Indus Commission in Lahore at the end of last month, although the meeting was not due until March 2019. The Commission’s meeting, however, attracted little attention in India.

The Modi government’s meandering Pakistan policy is also apparent from another volte-face: It hastily permitted and then, after Khan’s mocking statement, postponed a tour of inspection of new Indian projects on River Chenab by Pakistan’s Indus commissioner and two other officials. In September 2016, Modi had vowed that, “Blood and water cannot flow together”. But two years later, instead of action, visible backsliding is evident. The Indus Waters Treaty remains the world’s most generous water-sharing pact. India, however, remains reluctant to leverage this treaty to tame a scofflaw neighbour.

Successive Indian governments have failed to develop a clear strategy to deal with Pakistan. The Modi government has finally realized what was well known — that “Pakistan will not mend its ways”. It’s better late than never. It has also acknowledged that talks with Pakistan would be “meaningless”, given “the evil agenda of Pakistan” and the “true face” of the Imran Khan government. Can we now hope that India would develop consistency, clarity and courage in its Pakistan policy and fashion a coherent strategy to contain a rogue neighbour?

Brahma Chellaney is a geostrategist and author.

China expands its control in South China Sea

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Filipino activists rally outside the Chinese Consulate in Manila in February to protest Beijing’s continued reclamation activities in the South China Sea. © Reuters

BY BRAHMA CHELLANEY, The Japan Times, September 18, 2018

As China consolidates its hold in South China Sea and wields its military, economic and diplomatic leverage, smaller countries see no credible option but to work with Beijing, even if that means furthering Chinese objectives. Manila, for example, seems willing to accede to Beijing’s demand for joint development of hydrocarbon resources in the Philippines’ own exclusive economic zone.

The plain fact is that U.S. inaction under successive administrations has allowed China to gain effective control over a strategic sea that is more than twice the size of the Gulf of Mexico and 50 percent bigger than the Mediterranean Sea. Australia’s Kevin Rudd, who is still fending off accusations that he was “a slavish pro-China prime minister,” has acknowledged that “Chinese policy has not yet been challenged in the South China Sea by the United States to any significant extent.”

The U.S., even at the risk of fostering Philippine helplessness against Chinese expansionism, has refused to clarify whether its 1951 Mutual Defense Treaty with Manila would apply to an attack on Philippine troops or vessels in the South China Sea. This refusal stands in contrast to Washington’s commitment to the defense of the Japanese-administered but Chinese-claimed Senkaku Islands in the East China Sea. U.S. President Donald Trump, in his joint statement with Prime Minister Shinzo Abe in April, said that “Article 5 of the U.S.-Japan Treaty of Mutual Cooperation and Security covers the Senkaku Islands.”

In the South China Sea, China has astounded the world with the speed and scale of its creation of artificial islands and military infrastructure. The first Chinese dredger arrived in the region in December 2013. Less than five years later, China has largely completed building most of its forward military bases. It is now ramping up its military assets in the South China Sea.

Yet China has incurred no international costs for pushing its borders far out into international waters. In fact, China stepped up the expansion of its frontiers after an international arbitration tribunal invalidated its expansive claims in the South China Sea through a 2016 ruling in a case instituted by the Philippines.

U.S. Defense Secretary Jim Mattis recently called out China for its “intimidation and coercion” of smaller nations in the region. His criticism of the Chinese strategy in the South China Sea followed American action to disinvite China from this summer’s Rim of the Pacific maritime exercise, known as RIMPAC.

This might suggest that the U.S. is taking a tough line. In reality, America’s response to China’s expansionism in the South China Sea has remained muted. The U.S. has focused its concern merely on safeguarding freedom of navigation through the South China Sea.

In fact, the U.S. has refused to take sides in the territorial disputes between China and the other claimant-states in the South China Sea. The Trump administration stayed silent even when Chinese military threats forced Vietnam in March, for the second time in less than nine months, to halt oil and gas drilling on its own continental shelf.

The U.S. has similarly stayed neutral on disputes elsewhere between China and its neighbors. For example, President Barack Obama publicly said that “we don’t take a position on the sovereignty of the Senkaku Islands” and advised Tokyo and Beijing to sort out their dispute peacefully. This line has not changed under Trump, despite his reassurance that the Japan-U.S. security treaty covers the Senkakus.

Growing Asian anxieties over China have helped the U.S. to return to Asia’s center-stage by strengthening old alliances, such as with Japan, South Korea and Singapore, and building new strategic partnerships with India, Vietnam and Indonesia. It has also befriended the former pariah state of Myanmar.

Yet, despite this diplomatic windfall, the U.S. has been reluctant to draw a line on Beijing’s salami-style actions to change facts on the ground.

To be sure, the Trump-led U.S. has stepped up the so-called freedom of navigation operations in the South China Sea. But these operations neither reassure the smaller states nor deter China, whose actions continue to violate the United Nations Convention on the Law of the Sea, or UNCLOS.

In the East China Sea, China established an air-defense identification zone (ADIZ) in 2013 covering territories, like the Senkakus, that it claims but does not control. This action set a dangerous precedent in international relations.

In the South China Sea, rather than openly declare an ADIZ, China will likely seek to enforce one by gradually establishing concentric circles of air control — but only after it has deployed sufficient military assets there and further consolidated its hold.

It has already set up an interconnected array of radar, electronic-attack facilities, missile batteries and airfields on the disputed Spratly Islands. And by turning artificial islands into military bases, it has virtually established permanent aircraft carriers whose role extends to the Indian Ocean and the western Pacific.

China’s strategy poses a serious challenge to its neighbors, which face a deepening dilemma over how to deal with its creeping aggression.

The U.S., while seeking to protect its military freedom of navigation in the South China Sea, has effectively turned a blind eye to the broader Chinese assault on the freedom of the seas, including restricting the rights of other states to natural resources on their own continental shelves.

Unless the U.S. shifts its focus from freedom of navigation to freedom of the seas, China will have its way, including forcing its smaller neighbors to share their legitimate resources with it.

The Philippines, for example, is at serious risk of wilting under Chinese pressure. Prevented by Chinese military threats from tapping energy resources in an area of seabed known as Reed Bank, which is located close the Philippine coast, Manila seems willing to enter into a deal with Beijing to equally share the output from a joint gas project there.

Under the international arbitration ruling, the Philippines have exclusive rights to Reed Bank. But with China trashing the ruling in the absence of an international enforcement mechanism, the message to Manila is that might makes right.

Left with no other option, Manila appears ready to offer Beijing half of the gas production, but no sovereign rights. The logic behind such a prospective offer is that any Western oil giant, if it developed Reed Bank, would take about 50 percent of the output as its share. So the choice is between a Western oil company like Exxon Mobil and a Chinese state-run giant, such as the China National Offshore Oil Corp.

But such a Philippine deal would encourage China to seek similar concessions with other claimant-states, effectively blocking out Western oil firms from the South China Sea.

Make no mistake: Chinese territorial and maritime revisionism has made the South China Sea the world’s most critical hot spot. In fact, the South China Sea has become central to the wider geopolitics, balance of power and maritime order.

Brahma Chellaney is a geostrategist and the author of nine books, including the award-winning “Water: Asia’s New Battleground.”

© The Japan Times, 2018.

India’s Indus leverage

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India must assert its full rights under the Indus Waters Treaty to leverage the pact and halt Pakistan’s undeclared war against it through terrorist proxies.

Indus-system rivers

Brahma Chellaney, The Hindustan Times

In foreign policy, it is important for national leadership to choose its rhetoric carefully and back its words with at least modest action. Words not backed by any action can undermine a country’s credibility and perhaps even its deterrence.

When Prime Minister Narendra Modi raised the Balochistan issue in his Independence Day speech in 2016, he seemed to signal an important Indian policy shift. At least that is how his reference to Balochistan was widely interpreted. But since then, India has been totally silent on the issue, although Balochistan — Pakistan’s Achilles heel — threatens to become the new East Pakistan because of military killings and mass graves. India has even denied visas to some exiled Baloch activists.

Take another key issue: the Indus Waters Treaty (IWT). In 1960, in the naïve hope that water largesse would yield peace, India gifted the bulk of the Indus system’s waters — and the largest three of its six rivers — to Pakistan under the IWT. The Indus treaty remains a colossus on the world stage: It is by far the world’s most generous water pact, both in terms of the downstream country’s share of the waters (80.52%) and the aggregate volume of average yearly flows reserved for it (167.2 billion cubic metres). Still, an ungrateful Pakistan has waged covert or overt aggression almost continuously and is now using the IWT itself as a stick to beat India with, including by contriving water disputes and internationalizing them as part of a “water war” strategy.

Against this background, Modi raised the hope that India would finally revisit the IWT, by seizing on the Pakistan Senate’s unanimous March 2016 resolution calling for the treaty’s re-evaluation. Indeed, while chairing a September 2016 internal meeting on the IWT, Modi warned that, “Blood and water cannot flow together”. Setting in motion the treaty’s reappraisal, an inter-ministerial committee of secretaries was established, and officials said that India would now assert all its rights under the IWT, including fully utilizing its share of the allotted waters and expediting its long-delayed hydropower projects.

But two years later, India, alas, appears to have returned to the former state of affairs. The committee of secretaries, headed by the PM’s principal secretary, has fallen by the wayside. Apart from completing the small, 330-megawatt Kishenganga project after 11 years, India has shown little urgency on Indus Basin water projects. Even as Punjab and other states bitterly feud over water, India’s failure to adequately harness the resources of the three smaller rivers reserved for it results in Pakistan receiving substantial bonus waters. Just these extra outflows to Pakistan are many times greater yearly than the total volumes under the Israeli-Jordanian water arrangement.

India’s zigzag policy is most apparent from the recent meeting of the Permanent Indus Commission (PIC). The IWT calls for the PIC to meet at least once a year. The previous PIC meeting, like the one before it, was convened after almost 12 months — on March 29-30 this year. The next meeting was not due until 2019, yet India held a fresh PIC meeting just five months later.

The recent August 29-30 meeting, held in Lahore, marked the first bilateral engagement since the new military-backed Imran Khan government took office in Pakistan. With Pakistan’s international isolation deepening and its economy in dire straits, the military there is tactically seeking “peace” talks with India while still employing terrorists in a proxy war. Through such talks, it also hopes to legitimize the government it helped install through a manipulated election. But with India’s own elections approaching, talks with Pakistan will be politically risky for the ruling BJP.

The PIC discussions — and a prospective foreign ministers’ meeting in New York — illustrate how Modi’s government is seeking to engage Islamabad in other ways. In fact, India has given permission to Pakistan’s Indus commissioner and two other officials to shortly begin a tour of inspection of Indian projects in Jammu and Kashmir and elsewhere. In the past, such a tour has been used to collect new information so as to mount objections to Indian projects. In keeping with its broader strategy to foment discontent and violence in J&K, Pakistan seeks to deny J&K people the limited water benefits permissible under the IWT.

While the US has dumped international pacts at will (from the Anti-Ballistic Missile Treaty to the Kyoto and Paris accords), India still clings to the world’s most-lopsided water treaty, adhering to its finer details, even as Pakistan refuses to honour the terms of the central treaty governing bilateral relations — the 1972 Simla peace pact. Pakistan also flouts its commitment to prevent its territory from being used for cross-border terrorism. The Indus may be Pakistan’s jugular vein, yet a visionless and water-stressed India has let the IWT hang from its neck like the proverbial albatross. Make no mistake: Only by asserting its Indus leverage can India hope to end Pakistan’s unconventional war.

Brahma Chellaney is a geostrategist and author.

© The Hindustan Times, 2018.

Nepal’s communist challenge to India

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Communist-ruled Nepal’s troubling tilt toward China — as exemplified by latest developments — is a reminder of the costs India is incurring for its blunder in engineering the ouster of Nepal’s constitutional monarchy and inadvertently paving the path to communist domination.

Brahma Chellaney, DailyO

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Nepal is a state symbiotically tied to India. Yet today it has an openly pro-China communist government that is hostile to India. The number of communist-ruled countries in the world increased by one to six earlier this year when landlocked Nepal joined China, Cuba, Laos, North Korea and Vietnam.

Despite Prime Minister Narendra Modi’s efforts to woo him, Nepal’s new prime minister, Khadga Prasad Oli, persists with his troubling tilt toward China.

Consider the latest two reminders of Oli’s approach: His government has pulled out of the first ever anti-terror military exercises being held from September 10 in Pune under the auspices of the grouping known as the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation, or BIMSTEC; and it has implemented a transit transport agreement with China mainly to undercut India’s leverage.

Nepal, a member of BIMSTEC along with India, Thailand, Myanmar, Bangladesh, Bhutan and Sri Lanka, had initially agreed to send a platoon-size army contingent to participate in the “Milex 2018” exercises, which were mentioned by Modi in his address to the recent BIMSTEC summit in Kathmandu. Nepal also had agreed to send its army chief, General Purna Chandra Thapa, to the Milex 2018 closing ceremony.

But it reversed its decisions after a backlash from the increasingly powerful pro-China lobby, largely represented by the ruling Nepal Communist Party (NCP). Instead, in a symbolic gesture, Nepal has sent three observers to the week-long exercises.

The Oli government, in effect, delivered a diplomatic snub to India. This is reinforced by the fact that Nepal, while shunning participation in Milex 2018, is joining China in military exercises also focused on counter-terror operations. The China-sponsored September 17-28 exercises will commence in Chengdu (capital of Sichuan province) a day after the Pune drill concludes.

The BIMSTEC summit represented Modi’s fourth visit to Nepal in four years. No other Indian prime minister has lavished such attention on Nepal. In fact, Modi was the first Indian PM to visit Nepal in 17 years.

But no sooner had Modi returned home from his latest Nepal visit than Oli’s government signed a protocol implementing the Nepal-China Transit Transport Agreement (TTA). Under the TTA, Nepal can trade with third countries through China’s Shenzen, Lianyungang, Zhanjiang and Tianjin seaports. It will also have access to the Shigatse, Lhasa and Lanzhou land ports.

The TTA looks good only on paper. Nepal’s dependency on Indian ports arises from geography. While Kolkata is 933 kilometres away, the nearest Chinese seaport for Nepal is at a distance of 3,300 kilometres.

In implementing the TTA, Nepal is not seeking to replace India with China for transit transport. Rather, the intent of the Oli government is to try and blunt India’s natural-geographic advantage and undermine its transit clout. Through this accord, it hopes to preclude another crippling Indo-Nepalese border blockade by Nepal’s Indian-supported Madhesi (plains people) activists.

In May this year, after Nepal’s communist government took office, Modi paid an official visit to that Himalayan nation. In contrast to China’s efforts to muscle its way into Nepal, Modi’s well-received visit sought to emphasize India’s historically close cultural, religious and people-to-people relations with that nation.

From starting his visit at Janakpur — where, according to the Ramayana, Lord Rama wed Sita — to offering prayers at Kathmandu’s Pashupatinath Temple (the oldest and holiest Shiva temple in Nepal) and at the iconic Muktinath Temple (sacred to both Hindus and Buddhists), Modi sought to project India’s soft power to counter China’s hard power. The launch of an Indo-Nepal bus service from Janakpur (Sita’s hometown) to Ayodhya (her abode after marriage) underscored the historically strong cultural ties between the two countries.

But just five days after Modi returned home, a new unified communist party, the Nepal Communist Party (NCP), was launched with China’s support through the merger of Oli’s Marxist-Leninist Party and the Maoist group. The merger of the two main communist groups into one party came about three months after they jointly came to power. Beijing first midwifed the birth of the unified communist party and then applauded the development, saying that, “China supports the country in choosing the social system and development path that suits its national realities”.

In fact, the peaceful victory of the Nepali communists has helped to obscure their violent past. Oli spent years in jail in the 1970s and 1980s, as a communist guerrilla, for waging war against the state. Nepal’s establishment of multiparty democracy within the framework of a constitutional monarchy in 1990 opened up political space for Maoists and Oli’s party. The Maoists launched a bloody insurrection in 1996 with the aim of overthrowing the monarchy through a “people’s revolution”.

A decade later, India brokered a peace accord that ended the protracted war between Maoists and government forces in Nepal. But to meet the Maoists’ main demand, Indian Prime Minister Manmohan Singh’s government — dependent on the support of communists who had links with the Nepali communists — engineered the abolition of the constitutional monarchy.

This blunder, which paved the way for the communists to eventually gain political ascendancy, will continue to impose serious costs on India for years to come. The Nepali Maoists secured the monarchy’s overthrow not through their violent “revolution” but with the direct help of their supposed ideological foe, India, which to this day remains haunted, paradoxically, by its own Maoist scourge.

India helped turn Nepal from a Hindu kingdom to a communist-ruled, China-leaning state, seriously undercutting its own traditional influence there.

Today, with the new unified communist party dominating all state institutions, Beijing is actively working to bring Nepal within its orbit. In fact, before Nepal’s elections, Beijing reportedly persuaded the divided communists to form a coalition and helped fund their campaign.

Most communist parties, including the Chinese Communist Party, gained power by violent means. Of the six communist-ruled countries currently in the world, Nepal boasts the only democratically elected communist government.

Yet the key question is whether Nepal’s communist government will sustain democracy or gradually smother democracy. Will it follow the example of Czechoslovakia, which came under communist sway following national elections in 1946? By 1948, the Czechoslovak communists gained full control of the government and set out to stifle democracy.

Nepal’s PM, dubbed “Oily Oli” by his critics, has already started undermining the independence of his country’s institutions and stacking them with his own loyalists. The communists have almost two-thirds majority in Parliament and governments in six of the country’s seven provinces. Card-holding communists now hold all the constitutional and other key positions, with efforts under way to emasculate institutions — from the judiciary to the election commission.

If this assault continues, Nepal will be emulating the trajectory of how Czechoslovakia became a single-party state. In fact, a weak opposition, a pliant judiciary and an overbearing executive are already creating conditions in Nepal for creeping authoritarianism to set in.

Nepal’s internal developments directly impinge on Indian security. India and Nepal, after all, share one of the world’s most-open borders that permits passport-free passage. China’s increasing penetration of Nepal also carries major implications for India’s security.

India must end its kid-glove treatment of the communists in power in Nepal and consider them as a force inimical to its interests. New Delhi must disabuse the Nepali communists of their notion that they can sustain their hostility toward India without incurring any costs.

Brahma Chellaney is a geostrategist and the author of nine books, including the award-winning “Water: Asia’s New Battleground.”