Trade penalties have tended to benefit China, Washington’s top rival

Brahma Chellaney, Nikkei Asia

Russian President Vladimir Putin holds talks with Chinese leader Xi Jinping via a video link from Moscow on Dec. 30, 2022: The sanctions are bringing America’s two main adversaries closer together. © Sputnik/Kremlin/Reuters

The flight of a Chinese reconnaissance balloon across the continental U.S. for several days before it was shot down has put into stark relief the fact that a rising China, not a declining Russia, poses the biggest threat to America.

Indeed, a number of observers believe that the biggest beneficiary of Western sanctions against Russia over its invasion of Ukraine has been Beijing, not Kyiv. This reminder of sanctions’ side effects should be moving Washington to rethink its approach, rather than relying ever more heavily on trade penalties.

Sanctions have long been a favorite foreign policy tool of the White House and the U.S. Congress, even though they rarely change the behavior of targeted countries. But with the relative decline of American power, the efficacy of sanctions has been noticeably eroding.

The unprecedented American-led sanctions against Moscow have had a global impact without reining in the Kremlin’s war machine or pushing Russian President Vladimir Putin to the negotiating table. At the same time, they are helping China to advance its economic and strategic interests.

“China has emerged, by a wide margin, to be Russia’s most important trade partner. It now receives about 20% of Russia’s total exports and is the source of over 35% of Russia’s total imports,” the Free Russia Foundation, a Washington-based advocacy group, said last month in a study based on 40 million customs records. It called China the “biggest winner” from Western punitive measures.

The sanctions are bringing America’s two main adversaries, China and Russia, closer together, cementing their anti-Western partnership and boosting bilateral trade in military technologies and equipment.

In exchange for greater access to Russian military technology, China has been aiding Moscow’s war in Ukraine by supplying navigation equipment, jamming technology and fighter jet parts to sanctioned entities, according to customs records reviewed by Washington research center C4ADS and The Wall Street Journal.

Russia and China, although natural competitors, have grown closer since the U.S. started to sanction Moscow over its 2014 seizure of Crimea from Ukraine.

But Chinese President Xi Jinping does not need to learn from Russia that aggression works, given his own expansionistic maneuvering from the South China Sea to the Himalayas. Indeed, none of his actions, including redrawing the geopolitical map and his mass incarceration of more than 1 million Muslims in Xinjiang have drawn a sanctions response remotely comparable to that imposed on Russia.

But the largely ineffectual sanctions campaign against Moscow looks likely to embolden Xi’s designs on Taiwan, especially since comparable penalties against Beijing would have even less impact given the much larger size of China’s economy and the countermeasures it has undertaken. Just as Putin was clear about his plans for invading Ukraine, so has Xi been explicit about absorbing Taiwan.

Meanwhile, Europe’s shift from cheap Russian energy to importing costlier supplies from elsewhere has opened the path for China to build a safety net that could withstand Western sanctions and even a blockade in the event of war over Taiwan. China has significantly boosted overland oil and gas flows from Russia at heavily discounted prices, setting up a supply line that would be difficult to interrupt.

U.S.-led sanctions have failed to change the behavior of other targets, too, including North Korea, Myanmar, Iran, Cuba, Syria and Venezuela. In each case, the penalties have only reinforced the regime’s renegade behavior.

Iran and North Korea have made significant advances in their nuclear, missile and drone programs while facing some of the harshest sanctions that the U.S. and its allies have ever imposed. Iranian drones are also playing an important role in Russia’s bombing campaign in Ukraine, while North Korea recently surprised Seoul by flying five drones through South Korean airspace for five hours, with one nearing the president’s office and none being shot down.

China has usually been quick to seize opportunities arising from a sanctions-hit country’s isolation. As a result, U.S. sanctions often help advance Beijing’s commercial and strategic interests.

For example, American trade penalties have pushed resource-rich Myanmar and Iran into China’s arms. China has not only emerged as a top investor in, and security partner of, Iran, but also has almost cornered Tehran’s oil exports at a hefty discount.

Asked about European Union sanctions over human rights violations, Cambodian Prime Minister Hun Sen told attendees at Nikkei’s 2021 Future of Asia conference, “If I don’t rely on China, who will I rely on?”

The fact that sanctions often tend to be a blunt instrument prompted U.S. President Joe Biden’s administration in its early days to order an internal review of American sanctions programs to understand their utility and consequences.

According to a declassified version of the review released in October 2021, the U.S. should assess whether sanctions are “the right tool for the circumstances” before imposing them, and coordinate punitive measures with allies to magnify their impact and achieve clear policy objectives.

The review, however, has done little to moderate the growing U.S. use of sanctions. While the Biden administration often acts in coordination with America’s allies, this support does not guarantee the penalties’ effectiveness as the West is no longer economically dominant.

Washington, instead of developing objective criteria for the circumstances that would justify sanctions, allows moral outrage and narrow geopolitical considerations to drive its sanctions policy. This needs to change, or its overreach could accelerate the relative decline of U.S. wealth and power.

Brahma Chellaney is professor emeritus of strategic studies at the Center for Policy Research in New Delhi and a former adviser to India’s National Security Council. He is the author of nine books, including “Water: Asia’s New Battleground.”

The details of China’s loan contracts with developing countries are only beginning to come to light. But it is already clear that China’s creditor imperialism holds far-reaching risks, both for the debtors themselves and for the future of the international order.

BRAHMA CHELLANEY, Project Syndicate

Recently released details of Kenya’s 2014 loan agreement with China to finance a controversial railway project have once again highlighted the predatory nature of Chinese lending in developing countries. The contract not only imposed virtually all risk on the borrower (including requiring binding arbitration in China to settle any dispute), but also raised those risks to unmanageable levels (such as by setting an unusually high interest rate). With terms like that, it is no wonder that multiple countries around the world have become ensnared in sovereignty-eroding Chinese debt traps.

Over the last decade, China has become the world’s largest single creditor, with loans to lower- and middle-income countries tripling in this period, to $170 billion at the end of 2020. Its outstanding foreign loans now exceed 6% of global GDP, making China competitive with the International Monetary Fund as a global creditor. And through loans extended under its $838-billion Belt and Road Initiative (BRI), China has overtaken the World Bank as the world’s largest funder of infrastructure projects.

To be sure, since the start of the made-in-China COVID-19 pandemic, China’s overseas lending for infrastructure projects has been on the decline (until 2019, it was rising sharply). This is partly because the pandemic left partner countries in dire economic straits, though growing international criticism of China’s predatory lending has likely also contributed.

One might hope that this downward trend augurs the end of colonial-style lending by China. But the decline has been offset by an increase in bailout lending, mostly to BRI partner countries – including Kenya – which were already weighed down by debts owed to China.

The scale of the bailout lending is massive. The top three borrowers alone – Argentina, Pakistan, and Sri Lanka – have received $32.8 billion in rescue lending from China since 2017. Pakistan has been the biggest borrower by far, receiving a staggering $21.9 billion in Chinese emergency lending since 2018.

This highlights the self-reinforcing debt spiral into which China thrusts countries. Because China, unlike the IMF, does not attach stringent conditions to its loans, countries simply borrow more to service outstanding debts, thus sinking ever deeper into debt.

Crucially, China’s loan contracts are typically shrouded in secrecy; Kenya’s revelations, for example, were technically in violation of its agreement’s sweeping confidentiality clause. In many cases, the loans are hidden from taxpayers, undermining government accountability. China also increasingly directs its lending not to governments directly, but to state-owned companies, state-owned banks, special purpose vehicles, and private-sector institutions in recipient countries. The result is crushing levels of “hidden debt.”

Consider Laos, where hidden debts to China eclipse official debts. To stave off default following the pandemic shock, the small, landlocked country was forced to hand China majority control of its national electricity grid. And it may find itself with little choice but to barter away land and natural resources.

There is ample precedent for this. Already, several of China’s debtors have been forced to cede strategic assets to their creditor. Tajikistan has surrendered 1,158 square kilometers (447 square miles) of the Pamir mountains to China, granted Chinese companies rights to mine gold, silver, and other mineral ores in its territory, and approved the Chinese-funded construction of a military base near its border with Afghanistan.

Sri Lanka’s debt crisis first attracted international attention in 2017. Unable to repay Chinese loans, the country signed away the Indian Ocean region’s most strategically important port, Hambantota, and more than 6,000 hectares of land around it, by granting a 99-year lease to China. In Sri Lanka, the port transfer was likened to a heavily indebted farmer giving his daughter to an unyielding money lender. Despite this sacrifice, Sri Lanka defaulted on its debts earlier this year.

Similarly, Pakistan has given China exclusive rights to run its strategically located Gwadar port for four decades. During that time, China will pocket a whopping 91% of the port’s revenues. Moreover, the China Overseas Ports Holding Company will enjoy a 23-year tax holiday to facilitate its installation of equipment and machinery at the site.

Near Gwadar, China plans to build an outpost for its navy – a move that follows a well-established pattern. Debt entrapment enabled China to gain its first overseas naval base in Djibouti, strategically situated at the entrance to the Red Sea. China is also now seeking a naval base on the West African coastline, where it has made the most progress in Equatorial Guinea, a heavily indebted low-income country.

This is the result of a lending strategy that is focused squarely on maximizing leverage over borrowers. As one international study showed, “cancellation, acceleration, and stabilization clauses in Chinese contracts potentially allow the lenders to influence debtors’ domestic and foreign policies.” China often exercises this policy leverage by reserving the right to recall loans arbitrarily or demand immediate repayment.

In this way, China can use its overseas lending to advance its economic and diplomatic interests. If China can dim the lights in Laos, for example, it has a certain ally in multilateral forums. If it can drive a country to debt default, it can secure all the trade and construction contracts it wants. And if it can control a country’s ports, it can strengthen its strategic position.

The details of China’s loan contracts with developing countries have not yet come fully to light. But it is already clear that China’s creditor imperialism carries far-reaching risks, both for the debtors themselves and for the future of the international order.

Brahma Chellaney, Professor of Strategic Studies at the New Delhi-based Center for Policy Research and Fellow at the Robert Bosch Academy in Berlin, is the author of nine books, including Asian Juggernaut; Water: Asia’s New Battleground; and Water, Peace, and War: Confronting the Global Water Crisis.

© Project Syndicate, 2022.

Biden claims U.S. leverage over China is lacking. But he thinks the U.S. has leverage to cause economic collapse and regime change in Russia, an approach clearly based on hope. His focus on the wrong foe while seeking to appease China threatens to accelerate America’s relative decline.

Brahma Chellaney, Nikkei Asia

The new export curbs U.S. President Joe Biden recently imposed on the Chinese chip industry to help slow Beijing’s technological and military advances have obscured his administration’s relatively conciliatory stance since taking office.

Even the export curbs have been undercut by exemptions granted to major Taiwanese and South Korean companies for their chipmaking facilities in China.

Chinese President Xi Jinping, meanwhile, wants Biden to live up to “Five Nos” which Beijing claims the U.S. president has committed to: No to changing China’s authoritarian system; no to containing China; no to seeking U.S. economic decoupling from China; no to a policy of “one China, one Taiwan;” and no to conflict or a new Cold War with China.

According to the official Chinese readout of the two leaders’ recent meeting in Bali, “President Xi said he takes very seriously President Biden’s ‘Five Nos’ statement.”

The White House may not have directly corroborated such commitments, but similar formulations can be found in Biden’s comments and his administration’s public declarations and documents.

For example, in sharp contrast to predecessor Donald Trump’s ideological offensive against China as a predatory communist state without political legitimacy or the rule of law, Biden and his national security team have repeatedly disclaimed any intention to transform the country’s political system.

Biden himself assured Xi in a virtual summit a year ago that the U.S. would not seek to change China’s political system or direct alliances against it. On a call with Xi in September 2021, Biden sought to explain American actions toward China “in a way that [is] not misinterpreted as … somehow trying to sort of undermine Beijing in particular ways,” a senior administration official told reporters.

Similar reassurances have been embedded in Biden’s Indo-Pacific strategy, which declares that, “Our objective is not to change the [People’s Republic of China] but to shape the strategic environment in which it operates.” In Bali, Biden went a step further by telling Xi that the U.S. “respects China’s system,” according to Beijing’s account of the meeting.

China is not just the world’s largest autocracy. It is a technology-driven Orwellian surveillance state that is seeking to stamp out the cultural and linguistic identities of ethnic minorities whose sprawling homelands the Communist Party seized after coming to power in 1949. In the largest mass incarceration on religious grounds since the Nazi period, more than 1 million Muslims have been detained in Xi’s Xinjiang gulag.

Contrast Biden’s reassurances to China despite the country’s totalitarianism with his narrative that the Western conflict with Russia symbolizes a “battle between democracy and autocracy, between liberty and repression, between a rules-based order and one governed by brute force.”

While publicly seeking economic collapse and regime change in Russia, the Biden administration declared in May that it is seeking neither to block China’s “role as a major power” nor to “sever China’s economy from ours or from the global economy.” It added that it remains committed to its “One China” policy.

More recently, Biden assured Xi in Bali that the U.S. is “not looking for conflict” with China. “I absolutely believe there need not be a new Cold War,” the American president said.

Indeed, the Biden administration is seeking to “coexist and cooperate” with China, resisting labeling it as an outright enemy, despite Beijing covering up the origins of COVID-19, its oppression in Hong Kong and other territories, its redrawing of the geopolitical map of the South China Sea, and its forcibly changing the territorial status quo in the Himalayas.

The Biden-Xi agreement in Bali to empower senior officials to engage in a sustained effort to manage bilateral differences is scarcely going to stabilize U.S.-China relations, given that Beijing is a revisionist power. Indeed, Biden’s conciliatory approach may only embolden Xi.

Sensing weakness on the U.S. side, Xi has upped the ante on several fronts, from his frenzied buildup of nuclear weapons to hypersonic missile testing. Biden, who just turned 80, claims U.S. leverage on China is lacking, so he wants to work with U.S. allies to shape Beijing’s behavior.

Deterrence of further Chinese expansionism must start with Taiwan, whose Chinese takeover would upend the world order. Yet in Bali, Xi warned Biden that Taiwan is Beijing’s “first red line that must not be crossed in China-U.S. relations.”

More broadly, Biden’s emphasis on “outcompeting China and restraining Russia” runs counter to the statement in his 48-page national security strategy last month that China is “the only country with both the intent to reshape the international order and increasingly, the economic, diplomatic, military and technological power to advance that objective.”

While Russia is trying to mitigate a perceived security threat in its neighborhood, China is seeking to supplant the U.S. as the preeminent global power.

China’s population and economy are each about 10 times the size of Russia’s, and its military expenditures are more than four times greater. Yet the U.S. proxy war with Russia, which has led Washington to commit a total of $91 billion for Ukraine and ask Congress for more than $37 billion in additional emergency aid, is deepening Biden’s conciliatory approach toward China while simultaneously pushing Moscow closer to Beijing.

The U.S. is in no position to meaningfully take on China and Russia simultaneously. The Biden administration’s goal to “see Russia weakened” and allow the U.S. to single-mindedly focus on the threat of China is based on hope, not reality.

The worst outcome for the U.S. from the present international crisis would be the creation of a pan-Eurasian, China-Russia axis which would compound America’s strategic overreach and accelerate its relative decline. In fact, with the blowback from the economic war on Russia exacting an increasing toll on the West, China is likely to emerge as the only winner from the conflict over Ukraine’s future.

Brahma Chellaney is professor emeritus of strategic studies at the Centre for Policy Research in New Delhi and a former adviser to India’s National Security Council. He is the author of nine books, including “Water: Asia’s New Battleground.”

Tensions stemming from the war in Ukraine and the American withdrawal from Afghanistan have strained the strategic partnership between the US and India. But President Joe Biden cannot afford to alienate America’s most important partner in countering China’s rise.

BRAHMA CHELLANEY, Project Syndicate

The strategic partnership between the United States and India is pivotal to maintaining the balance of power in the vast Indo-Pacific region and counterbalancing China’s hegemonic ambitions. The US is India’s second-largest trading partner, and deepening the ties between the two countries is one of the rare bipartisan foreign policies that exists in Washington today.

The upcoming October 18-31 joint military exercise known as Yudh Abhyas (War Practice), in a high-altitude area less than 100 kilometers (62 miles) from India’s border with China, highlights the partnership’s growing strategic importance. India holds more annual military exercises with the US than any other country, as the two powers seek to improve their forces’ interoperability. As Admiral Michael M. Gilday, the US Navy’s Chief of Naval Operations, put it recently, India is a “crucial partner” in countering China’s rise.

But President Joe Biden’s decision to withdraw US forces from Afghanistan and effectively surrender the country to a Pakistan-reared terrorist militia, in addition to tensions related to Russia’s invasion of Ukraine, have strained the relationship between the world’s most powerful and most populous democracies.

Like many other countries, including US allies such as Israel and Turkey, India has taken a neutral stance on the war in Ukraine. Much to the chagrin of the US and Europe, the country has continued to purchase discounted oil from Russia, rebuffing the Biden administration’s offer to replace Russian oil with US supplies. Instead, India has increased its imports of Russian crude.

At the heart of India’s decision is fear of losing out to China. Since 2019, the US has used the sanctions on Iran’s oil exports to deprive India of cheaper Iranian oil, thereby turning it into the largest market for US energy exporters. The main beneficiary of the sanctions is China, which has increased its purchases of Iranian oil at a discount and developed a security partnership with the Islamic Republic without facing US reprisal.

While the US has already surpassed Russia as India’s largest weapons supplier, the American defense sector views the war in Ukraine as a “great opportunity” for arms sales to India to “surge.” Moreover, US Defense Secretary Lloyd Austin has urged Indian officials to avoid buying Russian equipment and purchase US-made weapons from now on.

Yet Biden’s overriding focus on punishing Russia could exacerbate India’s security challenges, especially if the international efforts to pressure Russian President Vladimir Putin inadvertently empower an expansionist China. The US-led sanctions and Europe’s shift away from Russian energy effectively put Russia – the world’s most resource-rich country – in the pocket of the resource-hungry Chinese. Its alliance with Russia has allowed China to build an energy safety net through an increase in land-based imports, which, unlike sea-borne deliveries, cannot be blockaded if Chinese President Xi Jinping decides to invade Taiwan.

Meanwhile, America’s recent $450 million deal to modernize Pakistan’s F-16 fleet – unveiled days after the US helped the country stave off an imminent debt default through an International Monetary Fund bailout – has evoked bitter memories of the US arming Pakistan against India and supporting the initial development of the Pakistani nuclear-weapons program during the Cold War.

The Biden administration’s disingenuous claim that upgrading Pakistan’s US-supplied F-16 fleet would advance counterterrorism has prompted a sharp response from India. During a recent visit to Washington, Indian Foreign Minister Subrahmanyam Jaishankar publicly condemned the deal, saying that the American explanation “is not fooling anyone”: Pakistan would undoubtedly deploy the upgraded fighter jets against India.

Against this backdrop, some observers have revived the old theory that US-India ties fare better under Republican administrations. Bilateral relations thrived during President Donald Trump’s administration, which relied heavily on India in developing its Indo-Pacific strategy. Trump instituted new US policies on China and Pakistan, whose increasingly close partnership has raised the prospect of India fighting a two-front war. In a major policy shift, Trump ended the 45-year US policy of aiding China’s rise. He also cut off security aid to Pakistan for not severing its ties with terrorist groups.

Biden, on the other hand, has resumed America’s coddling of Pakistan, made outreach to Beijing a high priority, and said nothing about China’s encroachments on Indian territory in the Himalayas. But by locking horns with China in a 30-month military standoff, India has openly challenged Chinese power in a way no other world power has done in this century.

Nothing better illustrates Biden’s neglect of the relationship with India than the fact that, since he took office, there has been no US ambassador in New Delhi. Meanwhile, the US ambassador to Pakistan, Donald Blome, caused an uproar during a visit to the Pakistani-held part of Kashmir, which he called by its Pakistani name – “Azad [Liberated] Jammu and Kashmir” – instead of “Pakistan-administered Kashmir,” as the United Nations calls it.

Moreover, the Biden administration has been trying to leverage human-rights issues against India. In April, US Secretary of State Antony Blinken alleged a “rise in human-rights abuses” in the country, prompting Jaishankar to counter that India is similarly concerned about the state of human rights in the US. Likewise, prominent members of the US Democratic Party can barely conceal their hostility to Indian Prime Minister Narendra Modi and his brand of Hindu nationalism.

Given that the US and India are both bitterly polarized democracies, officials should avoid statements that could inflame domestic tensions. If the US wishes to shift strategic focus to the Indo-Pacific, it must improve relations with its most important strategic ally in Asia. To that end, Biden must not squander the historic opportunity to forge a “soft” alliance with India. If the US is to prevail in its escalating rivalry with China and Russia and avoid strategic overreach, it needs India more than ever. But without mutual respect, the bilateral partnership is doomed.

Brahma Chellaney, Professor of Strategic Studies at the New Delhi-based Center for Policy Research and Fellow at the Robert Bosch Academy in Berlin, is the author of nine books, including Asian Juggernaut; Water: Asia’s New Battleground; and Water, Peace, and War: Confronting the Global Water Crisis.

© Project Syndicate, 2022.

Undermining its relationship with New Delhi will cost the U.S. dearly

Brahma Chellaney, Nikkei Asia

U.S. President Joe Biden’s concerted effort to cajole nations into joining the American-led coalition against Russia recalls the famous words of the legendary anti-apartheid leader Nelson Mandela, who said the grievous mistake some Westerners make is to insist that “their enemies should be our enemies.”

In the conflict between the West and Moscow over Russia’s invasion of Ukraine, much of the non-Western world has declined to take sides. So why has Biden especially bristled at India’s independent stance when the world’s major non-Western democracies — from Brazil and Mexico to South Africa and Indonesia — have all chartered a course of neutrality?

Because India is the world’s largest democracy, its neutrality undermines Biden’s narrative that the conflict symbolizes a “battle between democracy and autocracy, between liberty and repression, between a rules-based order and one governed by brute force.” Never mind that Ukrainian President Volodymyr Zelenskyy’s regime is no less autocratic than Russian President Vladimir Putin’s.

The fact is that whichever side the U.S. has armed over the decades was invariably portrayed by it as “fighting for freedom” — from the anti-Soviet Islamist guerrillas in Afghanistan from whom al-Qaida and the Taliban evolved, to Syria’s anti-Bashar Assad jihadists who gave rise to ISIS. Biden’s “new battle for freedom,” as he calls it, has led to increasingly sophisticated Western weapons pouring into Ukraine, with the U.S. also supplying battlefield intelligence, including targeting data.

Here’s the paradox: While seeking to co-opt New Delhi in his new Cold War with Moscow, Biden has still not uttered a single word on China’s two-year-long border aggression against India, which has triggered the largest Himalayan buildup of rival forces in history. In keeping with Biden’s outreach to Beijing, his State Department, equating the victim with the aggressor, has urged India and China to find “a peaceful resolution of the border disputes.”

India holds more annual military exercises with America, its largest trading partner and an increasingly important strategic partner, than any other country. U.S. arms sales to India went from near zero in 2008 to over $20 billion in 2020. India’s almost $150-billion goods and services trade with the U.S. dwarfs New Delhi’s $12.8 billion trade with Russia, its largest defense partner.

Indian and U.S. soldiers take part in a joint combat exercise in Ranikhet, India, in September 2016: India holds more annual military exercises with America than any other country.   © Reuters

Team Biden’s growing warnings to countries intent on sitting out the new Cold War to pick a side or face economic consequences could undermine the blossoming partnership with India, which stayed neutral even when the U.S. and its allies invaded Iraq or waged regime-change war in Libya. Biden’s top economic adviser, Brian Deese, touched a raw nerve in India when he threatened that “the costs and consequences” for it would be “significant and long-term.”

However, the more positive tone emanating from Washington following the latest U.S.-India discussions suggests that the White House may have secured an Indian assurance on “sanctions compliance,” as an American background briefer phrased it.

On April 11, Biden held an hourlong virtual discussion with Prime Minister Narendra Modi as a prelude to the “two-plus-two” discussions that Defense Secretary Lloyd Austin and Secretary of State Anthony Blinken jointly had with the visiting Indian defense and foreign ministers.

Encouraged by how America’s Iran sanctions have helped undercut India’s relationship with Tehran, Biden sees his Russia sanctions as opening a major opportunity to undermine the traditionally strong New Delhi-Moscow ties.

The U.S. used its Iran sanctions to deprive India of cheaper oil and turn it into the world’s largest importer of American energy. The main beneficiary of those sanctions has been India’s rival, China, which, without facing American reprisals, has been buying Iranian oil at a hefty discount, besides becoming Iran’s security partner and top investor.

Now Washington seems intent on employing its Russia sanctions to downgrade Indian defense ties with Moscow, with Austin calling on India to cut defense transactions with Russia and turn to America for all its military requirements. Indeed, Deputy Secretary of State Wendy Sherman told Congress that the U.S. sees “a great opportunity” for defense sales to India to “surge.”

Energy purchases and payments are exempt from America’s Russia sanctions. Yet, as if heeding Biden’s call to India not to accelerate or increase imports of heavily discounted Russian oil, the state-run Indian Oil Corporation, the country’s leading refiner, recently dropped Russia’s flagship Urals crude from its newest tender. And Indian Foreign Minister S. Jaishankar, by saying that “we won’t be in the top 10” buyers of Russian oil, has signaled that India will not significantly go beyond its traditionally modest imports of Russian energy.

Still, Biden is not easing pressure on India. While appeasing communist China, his administration is paradoxically trying to employ human-rights issues as leverage against India. After the two-plus-two discussions, Blinken took a swipe at India, alleging “a rise in human rights abuses.” But barely nine months earlier, Blinken had sung a different tune, saying “both of our democracies are works in progress.”

These are challenging times for U.S.-India relations. Undermining what should be America’s most important strategic partnership in Asia makes little strategic sense, especially if the U.S. wishes to genuinely pivot to the Indo-Pacific.

India’s neighborhood is already troubled, with a crisis-torn Sri Lanka suspending foreign debt payments and mounting Chinese repression triggering fresh self-immolations in Tibet. Yet, Biden surrendered Afghanistan to the Taliban terrorists, thereby strengthening Pakistan at India’s expense. And he is pushing military-ruled Myanmar into China’s arms with his sanctions policy.

Biden’s overriding focus on punishing Russia threatens to exacerbate India’s regional-security challenges, especially by aiding the further rise of an expansionist China. The U.S.-led sanctions will effectively put Russia, the world’s richest country in natural resources, in the pocket of a resource-hungry China.

The main brunt of the rise of a more powerful and aggressive China will be borne by its neighbors, especially India. Unlike Japan and Australia, which are under the U.S. security and nuclear umbrella, India must deal with China on its own, as the current Himalayan military crisis shows.

Brahma Chellaney is a geostrategist and author of nine books, including “Asian Juggernaut: The Rise of China, India and Japan.”

Brahma Chellaney, The Spectator

The world’s center of gravity is shifting to the Indo-Pacific. The new global order will be shaped by developments in a sprawling region where interstate rivalries and tensions are sharpening geopolitical risks. Building a stable balance of power in the Indo-Pacific has become more important than ever, but China’s territorial and maritime revisionism, and its heavy-handed use of economic and military power, are causing instability and undercutting international norms.

Against this background, the expanding strategic partnership between the world’s most powerful and most populous democracies — the United States and India — has become pivotal to equilibrium in the Indo-Pacific. With India’s closer integration, the four-nation Quad — Australia, India, Japan and the US — is blossoming as a strategic coalition of the leading Indo-Pacific democracies.

The Quad is central to the US’s “free and open Indo-Pacific” strategy. As American preeminence erodes, the US must augment its power with that of allies and partners. China’s foreign minister Wang Yi famously mocked the Quad in 2018 as a “headline-grabbing idea” that will dissipate “like the sea foam in the Pacific or Indian Ocean.” Instead, and thanks to China’s expansionist policies, the Quad continues to gain strength — despite the new, US-initiated AUKUS alliance with Australia and Britain. The US cannot build an Asian power equilibrium without India, Japan and Australia — and they cannot build it without the US.

Today, the US is also close to achieving a long-sought goal: a “soft alliance” with India that needs no treaty. The US has already emerged as the largest arms seller to India, leaving its traditional supplier, Russia, far behind. US defense transactions with India went from near zero in 2008 to over $20 billion in 2020. Furthermore, India has signed the four “foundational” agreements that the US maintains with all its close defense partners. These accords range from providing reciprocal access to each other’s military facilities and securing military communications to sharing geospatial data from airborne and satellite sensors.

India, a founder and leader of the Nonaligned Movement that sought to chart a neutral course in the US-Soviet rivalry during the Cold War, now makes little mention of nonalignment. Instead, it is multi-aligned and building close partnerships with democratic powers from Asia to Europe. India now holds more annual military exercises with America than any other country.

The main driver of the growing US-India strategic collaboration is China’s neo-imperial expansionism. President Xi Jinping believes that China has a narrow window of strategic opportunity to modify the international order in its favor before it confronts a demographic crisis, stalled economic growth and an unfavorable global environment. Accordingly, Xi has shown an increasing appetite for taking major risks.

American and Indian strategic priorities regarding China are, however, not the same. The US has never considered fighting a land war against China. The primary American objective is non-military: to counter China’s geopolitical, economic and ideological challenges. By contrast, China poses a pressing military challenge for India. The spotlight on the Chinese threats against Taiwan has helped obscure China’s more serious military confrontation with India along the long Himalayan frontier — a confrontation that is still raging.

The US and India, however, are united by other shared strategic interests. These include the rule of law, respect for territorial integrity and sovereignty, freedom of navigation, peaceful dispute resolution and a rules-based Indo-Pacific free of coercion. The biggest challenge to all these principles comes from China.

In May 2020, a shocked India discovered that China had stealthily encroached on several key border areas in the northernmost Indian territory of Ladakh. The discovery led to the first deadly Chinese-Indian military clashes in the Himalayas since 1975, including China’s first combat deaths in over four decades. The Indian and Chinese militaries remain locked in multiple standoffs, and the steadily increasing introduction of new weapons and troops by both sides has amplified the risk of renewed border skirmishing, if not outright war. Xi has picked a border fight with India that China cannot win. A war between these two nuclear- armed demographic giants is likely to end in a bloody stalemate with heavy losses on both sides. This is not the only instance in which Xi’s aggressive policies have proved to be counterproductive.

For India, China’s territorial aggression proves the importance of building close strategic collaboration with the US and likeminded powers. India today seems more determined than ever to frustrate China’s ambition to achieve Asian hegemony. By locking horns with China in tense military standoffs despite the risk of a full-scale war, India has openly challenged Chinese capability and power in a way no other power has done in this century. Since 2020, when India let Australia join the annual Exercise Malabar war games with the American, Japanese and Indian navies, the Quad has possessed a platform for an annual military exercise involving all its members.

Xi must now also contend with the strengthening US-India relationship. In a pivot to Asia that much of the US media either ignored or derided, the Trump administration gave India pride of place in its Indo-Pacific strategy. It also instituted fundamental shifts in US policies on China and Pakistan, two close allies whose strengthening strategic axis in southern Asia imposes high security costs on India, including raising the specter of a two-front war. Trump reversed the forty-five-year US policy of aiding China’s rise; with bipartisan support, he designated China as a strategic rival and threat. His administration also cut off security aid to Pakistan for not severing its ties with terrorist groups.

Relations between the Indo-Pacific’s two largest democratic powers thrived during the Trump presidency. Trump built a personal rapport with India’s prime minister Narendra Modi, with whom he shares a love for big audiences and theatrics. Trump joined Modi’s September 2019 public rally in Houston, which was attended by 59,000 Indian Americans and a number of US congressmen and senators. Then, during his February 2020 standalone visit to India, Trump spoke at the largest rally any American president has ever addressed — at home or abroad.

More than 100,000 people packed the world’s largest cricket stadium, in Modi’s home state of Gujarat. “America loves India, America respects India, and America will always be faithful and loyal friends to the Indian people,” Trump declared. After returning home, Trump called India an “incredible country,” saying, “Our relationship with India is extraordinary right now.”

The US and India are both bitterly polarized democracies. In each, rival political forces are self-segregated into their own ideological silos. Trump and Modi have faced similar accusations from critics. Both are accused of being blinkered demagogues, of pursuing divisive policies and choosing populism over constitutionalism. Each consciously avoided saying anything that could give a handle to the other’s domestic critics.

President Biden, by contrast, entered the White House after criticizing Modi’s government on issues like Kashmir and a new Indian law on citizenship for non-Muslim refugees who had fled religious persecution in neighboring Islamic countries. Biden’s election victory created uncertainty over the future direction of US-India ties. Indeed, as a senator, Biden had spearheaded a congressional sanctions move in 1992 that helped block Russia’s sale of cryogenic-engine technology for India’s civilian space program, setting it back many years.

Yet President Biden has sustained the momentum in the growth of the bilateral relationship. As with tacit acceptances of Trump’s other unorthodox foreign-policy initiatives, Biden has no choice but to recognize India’s centrality in an Asian balance of power. Despite his party’s hostility to Modi and Hindu nationalism, Biden’s interactions with Modi have been characterized by ease and warmth. In September, Biden welcomed Modi to the White House as “my friend” and said, “I’ve long believed that the US-India relationship can help us solve an awful lot of global challenges.”

Booming US exports to India — one of the world’s fastest-growing markets —reinforce bipartisan support in Washington for a closer partnership with New Delhi. The US has rapidly become an important source of crude oil and petroleum products for India, which is the world’s third-largest oil consumer after the US and China. But the US and India are not entirely on the same page.

America’s self-inflicted defeat and humiliation in Afghanistan at the hands of a Pakistan-backed terrorist militia have compounded India’s security challenges at a time when it should be fully focused on countering China’s Himalayan expansionism. Worse still, Team Biden, unlike the Trump administration, has placed outreach to Beijing as a high priority, and has been wary of publicly supporting India against Chinese aggression. The Democrats’ Russia fixation, meanwhile, is only strengthening under Biden.

Nevertheless, India will continue to quietly gain greater salience in US policy — especially as Russia and China deepen their entente. Instead of driving a wedge between these two natural competitors, US policy has helped turn them into close strategic partners. If the US is not to accelerate its relative decline through strategic overreach, it needs India more than ever. It would be doubly ironic, given Vice President Kamala Harris’s Indian heritage, if Biden did not seize the opportunity to formalize the US’s de facto and deepening security alliance with India.

This article was originally published in The Spectator’s March 2022 World edition.