Why Moon is courting India

Posted on July 10, 2018 by Chellaney

India gains importance for Seoul as South Korea’s ‘miracle economy’ starts to face major new challenges

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South Korean President Moon Jae-in’s visits to India and Singapore this week underscore his “New Southern Policy” (NSP), which gives priority to deepening bilateral relations with the ASEAN economies and India. NSP was unveiled on the heels of Moon’s “New Northern Policy”, whose primary but unstated objective is to jointly develop Russia’s Far East with Moscow. Simply put, the dual policies aim to invest greater resources in countries that previously were not on South Korea’s priority list.

Moon is seeking to diversify South Korea’s external portfolio so as to build a more “balanced diplomacy”. But while India’s Act East policy is driven by both geostrategic and geo-economic factors, Moon’s NSP is rooted mainly in economic logic.

There isn’t much room to expand Seoul’s already well-developed relations with China, Japan and the US. In fact, with new issues cropping up in ties with China and America, export-driven South Korea must find new markets to cut reliance on its top two trade partners. Moreover, despite increasing exports of semiconductors and electronics, South Korea’s economic growth has slowed, presenting it with important challenges.

Moon is targeting economies with the greatest growth potential: Several ASEAN economies and India are projected to grow at annual rates more than double that of South Korea in the coming years. Seoul, however, is not alone in courting Southeast Asia and India.

Japan under Prime Minister Shinzo Abe has pursued a “southward advance” economic strategy. Taiwan’s new “Southbound Policy” is driven by the same economic rationale, and seeks similar strategic objectives, as Moon’s NSP. China too has a southern policy, which goes by the official name of “One Belt, One Road”. Then there is Australia, which is looking at Southeast Asia and India, in part to mitigate its China-related risks.

Similar risks are also driving Moon’s NSP. China’s heavy-handed economic sanctioning of South Korea, in response to the US deployment of the THAAD anti-missile system, has served as a wake-up call for South Korea, making it conscious of its vulnerabilities and forcing a rethink. Although the informal Chinese sanctions began before Moon was elected president, the shock therapy administered by China’s use of economic coercion as a tool of statecraft led to his NSP.

South Korea is too heavily dependent on one market — China’s market — a factor that arms Beijing with considerable leverage over Seoul. Diversification is essential to a hedging strategy. And hedging is at the heart of Moon’s NSP.

Today, rebooting inter-Korean economic relations is emerging as an option — an option that can yield rich dividends if progress were made toward denuclearizing North Korea. Failure to build enduring inter-Korean peace, however, could rebound on the South Korean economy. Whatever scenario unfolds, the NSP imperative will likely remain intact. NSP, despite its economic focus, promises to yield broader diplomatic and strategic benefits for Seoul.

However, NSP is not an answer to the South Korean economy’s structural challenges. South Korea needs to make its economy less vulnerable to external shocks by undertaking structural reforms. In fact, Moon took office with a strong mandate to “democratize” economic growth and cultivate innovation by switching priorities from the giant family-owned conglomerates known as chaebol to smaller enterprises and start-ups and by encouraging bottom-up jobs growth. The country’s chaebol-centred crony capitalism spawned an influence-peddling scandal that cost Moon’s predecessor her job.

South Korea’s challenges largely arise from its extraordinary success in transforming itself from an economic minnow to the world’s fifth-largest exporter. South Korea was one of the world’s poorest countries in the early 1960s before it embarked on rapid economic expansion, becoming the world’s fastest-growing economy between 1963 and 1979. In 1996, South Korea joined the OECD, the club of the world’s wealthiest nations.

South Korea escaped the “middle income trap” in large part because of its democratic transition. China, however, risks falling into that trap. The fact is that South Korea went from poverty to wealth in almost one generation. There are few examples in modern history of such rapid economic success. But success can breed problems.

An unintended consequence of South Korea’s remarkable success has been its high exposure to global market volatility. South Korea has a high trade-to-GDP ratio, which is a good indicator of how vulnerable any country is to the dips and dives of the global economy. Ongoing changes in global market conditions, including US protectionism and the US-China trade war, will likely hit the South Korean economy harder than less export-dependent economies. For example, a deepening slowdown in China brought about by US tariffs would undermine South Korean exports to China, thereby further depressing South Korean growth.

Moon’s India visit was part of his effort to tide over such challenges. From enlarging South Korea’s footprint in the world’s third-biggest consumer market by purchasing power to peddling wares to the world’s largest arms importer, Moon sees India as central to NSP’s success. However, at a time when many chaebol are navigating generational transitions and Moon has committed to “democratize” economic growth, structural reform at home is the price South Korea must pay to sustain a “miracle economy”.

The writer is a geostrategist.

India’s mistakes have allowed China to make inroads into Nepal

Posted on July 7, 2018 by Chellaney

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Indian Prime Minister Narendra Modi with his Nepali counterpart, K.P. Oli, in Kathmandu in May.

Brahma Chellaney, The Hindustan Times

Nepal’s new communist prime minister, K.P. Oli, has paid obeisance in Beijing, where he agreed to the proposal to extend the railway from Shigatse in Tibet to his country so as to reduce Nepali dependence on India. For India, Nepal is not just another neighbour but one that is symbiotically linked through close cultural affinity, overlapping ethnic and linguistic identities, and an open border permitting passport-free passage. The China-Nepal railway — a “game changer”, as a Chinese mouthpiece called it — will compound the impact on India’s strategic interests of Nepal’s emergence as the world’s sixth communist-ruled country.

The two communist groups that came to power in February merged into a single party in May. The new Nepali Communist Party, with almost two-thirds majority in Parliament and governments in six of the nation’s seven provinces, casts an ominous shadow over Nepal’s sputtering democratic transition. From constitutional functionaries, such as the president and vice president, to key officials, including the chief of police services, are today card-carrying communists.

Emboldened by the communists’ pervasive domination, Oli has started undermining the independence of Nepal’s institutions, from the judiciary to the election commission. The communists’ next target will likely be the army. Whether democracy will survive under communist rule is uncertain. What is clear is that Nepal is impinging on Indian security.

A Nepal increasingly open to Chinese influence shares a tightly guarded frontier with Tibet but wishes to maintain an open border with India. India has repeatedly advised Nepal that its southern border belt is turning into a zone of jihadist and foreign intelligence activities that threaten Indian security. Nepal has also become a major transit point for the flow of counterfeit Indian currency, narcotics and Chinese arms to India.

Simply put, Nepal represents a critical challenge for India. But, to a significant extent, this is a self-created problem. Three Indian blunders since the mid-2000s have proved very costly for India — spearheading the abolition of Nepal’s constitutional monarchy; bringing the underground Maoists to the centre-stage of Nepali politics; and, more recently, aiding the plains people’s revolt against the new, 2015-drafted Nepali Constitution and then abandoning their movement and pressuring them (the Madhesis) to participate in the 2017 elections, thus legitimizing a Constitution it said was flawed.

New Delhi indeed owes an apology to Nepal’s citizens for its past meddling, which, as if to underscore the law of unintended consequences, boomeranged on India’s own interests. India’s mistakes set in motion developments that seriously eroded its clout in Nepal and helped China to made major inroads.

When history is written, one Manmohan Singh blunder in particular will stand out for empowering Nepali communists and undermining India’s long-term interests — engineering the ouster of Nepal’s monarchy, the symbol of that country’s stability, continuity and unity for 239 years. The monarchy was removed without ascertaining the will of the people through a referendum and without even a basic level of due process.

Singh’s government, which at that time was dependent on communist support at home for survival, intervened as a peace maker. But what mattered to it was just one thing — accommodating the Maoists’ main demand for the monarchy’s removal in order to bring them into the Nepali political mainstream. It hosted a meeting between Nepal’s Maoists and opposition parties in November 2005 at which an accord to abolish the monarchy was reached. How empowering Nepali Maoists and other communists would serve India’s interest, and what the larger implications of the monarchy’s abolition would be for Nepal’s future, were issues that went unexamined.

The upshot was that Nepal went from being a Hindu kingdom (indeed the world’s only officially Hindu nation) to coming under the sway of communists, who largely filled the void from the monarchy’s removal, thereby undercutting the influence of the Nepali Congress Party, dominant until then. From 2008 onwards, the Nepali communists were in coalition governments for almost a decade before capturing power on their own in the last elections. Oli’s Marxist-Leninist Party and the Maoists, which fought the elections jointly under China’s advice, tapped into grassroots anger over the Indian-backed Madhesi protesters’ earlier border blockade.

India, paradoxically, is still unable to make peace with its own Maoists. In fact, the Nepali Maoists’ Indian-assisted success in enjoying power after waging a decade-long bloody insurrection has emboldened the Indian Maoists to step up their hit-and-run attacks on police and paramilitary troops. Meanwhile, the Maoists’ dreamland, China, is pulling Nepal into its orbit. Make no mistake: India is reaping what it sowed.

Brahma Chellaney is a geostrategist and author.

Trump’s North Korea diplomacy aims to contain China

Posted on June 22, 2018 by Chellaney

Beijing is at risk of losing its only ally in Northeast Asia.

Brahma Chellaney, Nikkei Asian Review

U.S. President Donald Trump, by seeking to clinch a deal directly with Pyongyang, is attempting to effectively cut out the traditional middleman, China. Beijing’s growing anxieties over the engagement between Washington and Pyongyang have prompted it to host North Korean strongman Kim Jong Un for the third time in less than three months.

In fact, the White House has already eroded China’s role as an essential conduit in U.S. diplomacy with Pyongyang by establishing direct connections, including a virtual hotline, to Kim, while Chinese President Xi Jinping has no hotline with him.

Kim has also fueled Beijing’s geopolitical troubles, displaying strategic defiance as he attempts to cut North Korea’s dependence on China, its longtime benefactor. In his search for a grand bargain to end North Korea’s international isolation, Kim effectively sidelined China by deciding to hold separate summits with his nation’s bitterest enemies, South Korea and the U.S.

Instead of both Koreas leaning toward China, as Xi’s strategy seeks, recent developments are consigning Beijing to a peripheral role in the region just when a trade war with the U.S. looms large. China has silently waged a trade war for years, facing no international reprisals. The situation will fundamentally change if the bulk of Trump’s tariffs of 25% on $50 billion of imports from China take effect from July 6.

Kim’s three visits to China in quick succession cannot obscure the serious strains in Beijing-Pyongyang relations, which Mao Zedong famously claimed were as close as lips are to teeth. Distrust of China, the historical rival of Koreans, runs deep in North Korea, which has no monuments honoring the 400,000 Chinese soldiers who died fighting on its behalf during the 1950-1953 Korean War.

Bilateral ties began deteriorating after Kim came to power in late 2011. China’s state media accused him of pursuing the “de-Sinification” of the hermit kingdom. Kim broke with the tradition set by his father and grandfather, who ruled before him, of paying obeisance in Beijing. To counterbalance China’s influence, Kim sent out feelers to U.S. President Barack Obama to improve relations, only to be rebuffed.

Yet Kim’s defiance of China continued. His nuclear and missile tests were often timed to snub Beijing. The tests set in motion developments adverse to Chinese interests — from initiating Japan’s efforts to strengthen its military to prompting the U.S. to deploy the Terminal High Altitude Area Defense, or THAAD, anti-missile system in South Korea. THAAD’s deployment led to China’s heavy-handed and counterproductive economic sanctioning of South Korea.

Xi sought to ease the increasingly fraught relationship with Pyongyang only after Trump began laying the groundwork for a summit with Kim by using the U.S. Central Intelligence Agency to communicate with its North Korean counterpart, the Reconnaissance General Bureau. Despite the past North Korean snubs, Xi sent a senior envoy to Pyongyang to invite Kim to China, his first foreign trip since assuming power.

Kim’s China visits since late March have been primarily aimed at strengthening his own bargaining position with the U.S. By playing one power against the other, he has sought to bolster his leverage. But his action in inviting observers from the U.S. and South Korea, but not China, to the dismantlement of North Korea’s nuclear test site indicated that he is unwilling to forgive Beijing for its linchpin role in imposing United Nations sanctions against his nation.

Consequently, China, which values North Korea as a strategic buffer against the U.S. military presence in South Korea, has become increasingly suspicious of Kim’s overtures to Washington and the Trump administration’s direct dealings with Pyongyang. U.S. Secretary of State Mike Pompeo’s visit to Beijing after the Trump-Xi summit did little to allay Chinese apprehensions.

Beijing fears that, just as it formally turned against the Soviet Union after it developed high-level contacts with the U.S. in the early 1970s, its estranged ally, North Korea, could similarly switch sides now. Kim, however, seems more interested in achieving a limited goal — rebalancing his foreign policy by mending fences with the U.S. to reduce North Korea’s reliance on China, whose neo-imperialist policies are arousing growing concerns in Asia and beyond.

Make no mistake: The path to North Korea’s denuclearization promises to be long and difficult, given its extensive nuclear and missile infrastructure and Kim’s firm belief that the nuclear arsenal serves as insurance against his country becoming China’s colony. Not only does such an arsenal hold greater security implications for China than for the U.S., but also Trump’s diplomacy is making it more difficult for Beijing to keep North Korea in its orbit. Washington’s direct diplomacy with North Korea began in dramatic fashion, with Pompeo, when he was CIA chief, holding unpublicized talks with Kim in Pyongyang.

Yet some analysts have speciously claimed that China, without being at the table, was the clear winner from Trump’s summit with Kim. Critics have accused Trump of making “big concessions” in exchange for securing indefinable commitments from Kim. The only concession Trump made — suspending U.S. war games with South Korea as a gesture of good faith — is easily reversible if negotiations do not yield progress.

To be sure, Beijing last September proposed the suspension of the U.S. military exercises in exchange for a North Korean moratorium on nuclear and missile testing. It was Kim, however, who undermined China’s “freeze for freeze” proposal by unilaterally declaring a test moratorium in April without any reciprocal U.S. concession.

Under Obama, the U.S. helped end Myanmar’s international isolation, with the U.S. president paying a historic visit to that county in 2012. The shift in U.S. policy allowed Myanmar to cut its dependence on China and open its economy to Western investors. Now Trump is encouraging another isolated, China-dependent state, North Korea, to end its international pariah status.

North Korea — with its vast store of iron ore, magnesite, copper and other minerals — is resource-rich like Myanmar, whose natural reserves range from oil and gas to jade and timber. Resource-hungry China has been the dominant importer of natural resources from both of these countries.

North Korea, however, is different from Myanmar in two key aspects. It is armed with potent nuclear and missile capabilities, while it is also a homogenous and regimented society, in contrast to ethnically diverse and troubled Myanmar.

Trump is right that at this stage fundamentally changing the U.S.-North Korea relationship matters more than denuclearization. If the West encourages Kim’s efforts to modernize the North Korean economy, just as it aided China’s economic rise since the late 1970s, it will help to moderate Pyongyang’s behavior. Economic engagement can achieve a lot more than economic sanctions, which counterproductively accelerated North Korea’s nuclear and missile advances.

U.S. policy under Trump’s predecessors, instead of helping Pyongyang to escape from China’s clutches, attempted to push it further into China’s corner. It also helped Beijing to play the North Korea card against the U.S. and its regional allies, Japan and South Korea.

But Beijing’s efforts to string the U.S. along on North Korea came to naught when Washington established direct contact with Pyongyang. Beijing even tried to use its North Korea leverage in the trade dispute with Washington, which explains why Trump waited until after his summit with Kim to announce new planned tariffs against China.

With Washington’s sanctions-only approach encouraging Pyongyang to expand its nuclear and missile programs, a shift in its North Korea policy became imperative even before Trump took office. Trump’s direct diplomacy seeks to address that imperative by seizing on Pyongyang’s desire to unlock frozen ties with the U.S. and by exploiting the China-North Korea rift.

At the core of Trump’s North Korea gambit is the containment of China, a fact many analysts have missed. By seeking to co-opt North Korea, including encouraging closer links with Seoul, Washington aims to foster a major new regional alignment that diminishes China’s relevance.

If Beijing cannot keep North Korea as a client state, China’s lonely rise will become more conspicuous. Its only other strategic ally is Pakistan. The more power China has accumulated, the greater has been its problems in gaining reliable security partners, underscoring that regional leadership demands more than brute might.

Clearing the path to North Korean disarmament will not be easy. Yet Trump’s direct diplomacy promises to positively change northeast Asian geopolitics by crimping China’s leverage and role, even as U.S. troops remain in South Korea. If Washington stays on its current course, China will be the clear loser.

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

Who Lost the South China Sea?

Posted on June 16, 2018 by Chellaney

BRAHMA CHELLANEY, a column internationally syndicated by Project Syndicate

The South China Sea is central to the contest for strategic influence in the larger Indo-Pacific region. Unless the US adopts a stronger policy to contain Chinese expansionism there, the widely shared vision of a free, open, and democratic-led Indo-Pacific will give way to an illiberal, repressive regional order.

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US Defense Secretary Jim Mattis has spoken out against China’s strategy of “intimidation and coercion” in the South China Sea, including the deployment of anti-ship missiles, surface-to-air missiles, and electronic jammers, and, more recently, the landing of nuclear-capable bomber aircraft at Woody Island. There are, Mattis warned, “consequences to China ignoring the international community.”

But what consequences? Two successive US administrations – Barack Obama’s and now Donald Trump’s – have failed to push back credibly against China’s expansionism in the South China Sea, which has accelerated despite a 2016 international arbitral tribunal ruling invalidating its territorial claims there. Instead, the US has relied on rhetoric or symbolic actions.

For example, the United States has disinvited China from this summer’s 26-country Rim of the Pacific (RIMPAC) naval exercise. The move has been played up as a potential indication that the US may finally be adopting a tougher approach toward China. Mattis himself has called the decision an “initial response” to China’s militarization of the South China Sea, which is twice the size of the Gulf of Mexico and 50% bigger than the Mediterranean Sea.

Similarly, the US Navy’s freedom of navigation (FON) operations, which are occurring more regularly under Trump than they did under Obama, have been widely hyped. After the most recent operation, in which a guided-missile cruiser and a destroyer sailed past the disputed Paracel Islands, Mattis declared that the US was the “only country” to stand up to China.

But China, too, has used America’s FON operations to play to the Chinese public, claiming after the latest operation that its navy had “warned and expelled” two US warships. More important, neither FON operations nor China’s exclusion from the RIMPAC exercise addresses the shifts in regional dynamics brought about by China’s island-building and militarization, not to mention its bullying of its neighbors. As a result, they will not credibly deter China or reassure US allies.

The reality is that China’s incremental encroachments have collectively changed the facts in the South China Sea. It has consolidated its control over the strategic corridor between the Indian and Pacific Oceans, through which one-third of global maritime trade – worth $5.3 trillion last year – passes. It is also asserting control over the region’s natural resources, by bullying and coercing other claimants seeking to explore for oil and gas in areas that are theirs under the United Nations Convention on the Law of the Sea. Vietnam, for example, has been forced to scrap a project on its own continental shelf.

Perhaps most ominous, China’s development of forward operating bases on manmade South China Sea islands “appears complete,” as Admiral Philip Davidson told a Senate committee in April before taking over the US Indo-Pacific Command. “China is now capable of controlling the South China Sea in all scenarios short of war with the US,” Davidson confirmed.

Davidson’s characterization is revealing. As China takes a long-term strategic approach to strengthening its hold over the South China Sea (and, increasingly, beyond), the US is focused solely on the prospect of all-out war.

The Pentagon has flaunted its capability to demolish China’s artificial islands, whose creation Chinese President Xi Jinping has cited as one of his key accomplishments. “I would just tell you,” joint staff director Lt. Gen. Kenneth McKenzie recently said, “the US military has had a lot of experience in the western Pacific taking down small islands.”

If open war is China’s only vulnerability in the South China Sea, the US will lose the larger strategic competition. While seeking to protect its military freedom of navigation in the South China Sea, the US has turned a blind eye to China’s stealthy but aggressive assault on the freedom of the seas, including restricting the rights of other countries in the region.

The only viable option is a credible strategy that pushes back against China’s use of coercion to advance its territorial and maritime revisionism. As Admiral Harry Harris cautioned last month while departing as head of the US Indo-Pacific Command, “Without focused involvement and engagement by the US and our allies and partners, China will realize its dream of hegemony in Asia.”

Simply put, China is winning the battle for the South China Sea without firing a shot – or paying any international costs. While Trump is sustaining this trend, it began under Obama, on whose watch China created seven artificial islands and started militarizing them.

Obama’s silence in 2012 when China occupied the disputed Scarborough Shoal – a traditional Philippine fishing ground located within that country’s exclusive economic zone – emboldened China to embark on a broader island-building strategy in the South China Sea the following year. By the time the US realized the scope and scale of China’s land-reclamation program, Russia grabbed its attention by annexing Crimea. Yet the long-term strategic implications of what China has achieved in the South China Sea are far more serious.

Unfortunately, when it comes to constraining China’s expansionism, Trump seems just as clueless as his predecessor. Focused obsessively on three issues – trade, North Korea, and Iran – Trump has watched quietly as China builds up its military assets through frenzied construction of permanent facilities on newly reclaimed land. And now China has begun making strategic inroads in the Indian Ocean and the East China Sea, threatening the interests of more countries, from India to Japan.

The South China Sea has been and will remain central to the contest for influence in the larger Indo-Pacific region. Thanks to US fecklessness, the widely shared vision of a free, open, and democratic-led Indo-Pacific could give way to an illiberal, repressive regional order, with China in full control.

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.

Trump delivers lessons for Japan on North Korea

Posted on June 15, 2018 by Chellaney

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By BRAHMA CHELLANEY, The Japan Times

Japan was so concerned that its security interests would be overlooked in a U.S. nuclear deal with North Korean ruler Kim Jong Un that Prime Minister Shinzo Abe visited the White House just before President Donald Trump left for Canada and Singapore. Yet Japan’s strategic imperatives and interests were barely on Trump’s mind when he met Kim. Despite Trump saying that he raised with Kim the decades-old North Korean abductions of Japanese citizens, Japan’s interests got short-shrift.

With the Singapore summit yielding only a joint statement, Trump has bet on what he called a “very special bond” and “terrific relationship” with Kim to secure a real deal. It is worth remembering that Trump has said similar things about Abe and several other world leaders, only to ignore their interests or turn on them later. Canadian Prime Minister Justin Trudeau, for example, is still licking his wounds.

As Trump’s announcement to suspend U.S. war games with South Korea underscored, he is seeking to narrowly advance American interests, especially saving money — a factor that he said could eventually lead him to bring back home the 32,000 American troops stationed in South Korea. A dilution of U.S. security commitments in northeast Asia, however, is contrary to Japanese strategic interests.

Trump is only stoking Japanese concerns about America’s long-term commitment to regional security by signaling that a rapprochement with North Korea could possibly lead to a broader U.S. retreat from northeast Asia. Announcing the suspension of the war games without prior notification to South Korea, for example, sent the wrong message to allies, although U.S. and South Korean officials had previously discussed this option.

More fundamentally, Trumps seems unmindful of the fact that the alliance system is essential — and cost-effective — for the United States to pursue its regional objectives, including maintaining a stable balance of power.

Tokyo, in the most generous host-nation support by any of America’s 27 allies, pays billions of dollars yearly for the basing of U.S. troops on Japanese territory. South Korea, in addition to its host-nation support, has generously picked up about 92% of the $10.8 billion cost of the U.S. military’s new base, Camp Humphreys, located south of Seoul. It is much cheaper for the U.S. to keep troops in South Korea (or Japan) than to have them back home.

To Trump’s credit, he has correctly described as “very provocative” the U.S.-led war games, which, with live-fire drills, simulate every spring a full-scale invasion of North Korea. Critics are upset that he has lifted the pretense that these war games are routine “military exercises” and defensive in nature.

Progress toward denuclearization, however, is likely to be slow. The joint statement implicitly links denuclearization to “mutual confidence building.” What has been set in motion is a complex, long process of bargaining, deal making and, if all goes well, denuclearizing.

The joint statement’s reference to the denuclearization of the Korean Peninsula, not just North Korea, means creating a nuclear-weapons-free zone. Such a zone can emerge only if South Korea steps out of the U.S. nuclear umbrella and America, China and Russia formally commit not to introduce, or threaten to use, nuclear weapons on the Korean Peninsula.

For decades, Japan and South Korea have remained under the U.S. nuclear umbrella. But, in reality, the U.S. is unlikely to use nuclear weapons to defend Japan or South Korea; it will rely instead on conventional weapons. The nuclear umbrella serves more as a potent symbol of U.S. commitment and as a nonproliferation tool to prevent either ally from developing its own nuclear weapons.

Still, if South Korea agrees to be outside the American nuclear umbrella, Japan — the world’s only victim of nuclear bombings — will find itself in the odd position of being the sole Asian country inside the umbrella. This will hardly sit well with its diplomatic interests.

But what prompted Abe’s latest White House visit was concern that Washington could tolerate a North Korean sub-regional nuclear arsenal if Kim dismantled his long-range nuclear capability that threatens America. Tokyo’s security nightmare is North Korea retaining the short- and medium-range portion of its nuclear arsenal while China continues to expand its nuclear and conventional military capabilities. If North Korea kept a residual, subregionally confined nuclear capability, it would reinforce Japanese and South Korean reliance on security arrangements with America.

Such a scenario is not improbable, especially with the Trump administration saying goodbye to the “Libya model” and seeking instead to apply the “South Africa model” to North Korea.

The administration’s early brinkmanship almost derailed the Singapore summit when its references to the Libya model provocatively suggested that Kim follow a path that ultimately led to Libyan strongman Muammar Gaddafi’s gruesome end. But, recognizing North Korea’s longstanding resistance to intrusive international inspections, U.S. officials now say their role model is apartheid-era South Africa.

Before transiting to black majority rule, South Africa secretly dismantled its six nuclear weapons, destroying all major documents relating to them but stashing weapons-grade enriched uranium. It then opened its sites to international inspection.

Such voluntary denuclearization outside international monitoring is not an example of complete, verifiable and irreversible dismantlement, which is what Japan wants to see in North Korea. America’s focus, however, is on safeguarding its own security. Trump, after the summit, wrote online that North Korea no longer poses a nuclear threat to the U.S., adding that Americans should “sleep well tonight.”

While his secretary of state, Mike Pompeo, has spoken of “in-depth verification,” North Korea is likely to allow external inspectors only limited access at best. Intrusive international monitoring, with inspectors free to go anywhere, could sound the death knell for Kim’s secretive regime. In the past, the U.S. has sent intelligence agents as international nuclear inspectors, as the Iraq investigations revealed.

A Japan exposed to a potential North Korean nuclear strike would be open to atomic blackmail and coercion. Yet, some U.S. officials and analysts have characterized Japan’s insistence on complete, verifiable and irreversible disarmament as “maximalist,” as if seeking a deal that addresses only U.S. security interests (as the Trump administration is apparently doing) amounts to a reasonable stance.

Another issue also highlights how self-interest drives U.S. policy. The joint statement commits North Korea to repatriate the remains of American military personnel missing from the Korean War. But it contains no reference to a highly emotive subject in Japan — abductions of Japanese citizens by Pyongyang’s agents to train as spies. Trump said he “absolutely” raised that topic but did not indicate what Kim’s response was.

Let’s be clear: Dismantling North Korea’s extensive nuclear infrastructure will entail a long-drawn-out process. Nuclear weapons are the only assets the North can leverage to end its international pariah status. Kim is unlikely to give up his “crown jewels” without U.S. security guarantees that go beyond symbolic steps and a temporary halt of U.S.-led war games. Nor will he unilaterally disarm without reciprocal actions to turn the Korean Peninsula into a nuclear-weapons-free zone.

While Trump is seeking, to quote Pompeo, “major disarmament” in the remainder of his current term, Kim, who is less than half the age of the U.S. president, has a much longer time horizon. Kim is playing a long game to ease his country’s international isolation and build an independent foreign policy that diminishes dependence on China.

A stretched-out denuclearization process, however, suits China too. It will allow Beijing to string the U.S. along on North Korea while it stakes out a key role for itself by leveraging its status as a linchpin to keeping Pyongyang under economic pressure. More ominously, U.S. preoccupation with North Korea will aid China’s territorial and maritime revisionism in the Indo-Pacific region, including consolidating its hold in the South China Sea. To gain dominance in Asia, Beijing is seeking to marginalize Japan and weaken the U.S. alliance with South Korea.

Japan today finds itself thoroughly marginalized on the North Korean issue, despite that subject’s critical importance to its long-term security. Abe’s tireless efforts to cultivate Trump have yielded little on that front.

In this light, Japan has no option but to directly deal with Pyongyang. Indeed, this is the central takeaway for Japan from Trump’s North Korea diplomacy.

To be meaningful, such engagement must be without preconditions. There is no reason why the abductions issue should still hold Japan’s strategic interests hostage. At a time when Kim is seeking to mend fences with different powers, Japanese engagement could help persuade Pyongyang to reopen talks on the abductions topic and come clean.

Abe should seek to meet Kim on the sidelines of the Sept. 11-13 Eastern Economic Forum in Vladivostok, Russia. Kim is likely to accept Russian President Vladimir Putin’s invitation to attend that annual forum.

Make no mistake: The main lesson for Japan is that, instead of relying on Washington, it must directly engage North Korea by leveraging its economic might and soft power and playing to Kim’s rebalancing aspiration.

Brahma Chellaney is a geostrategist.

Doklam exemplifies China’s broader recidivism in Himalayas

Posted on June 12, 2018 by Chellaney

Brahma Chellaney, The Hindustan Times

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The first anniversary of the Doklam standoff calls for reflection on China’s strategy of territorial revisionism and India’s response. The Doklam Plateau, like the South China Sea, illustrates how China operates in the threshold between peace and war. Just as China has made creeping but transformative encroachments in the South China Sea without firing a single shot, it has incrementally but fundamentally changed the status quo in Doklam in its favour since ending the 73-day troop standoff with India.

Doklam exemplifies China’s broader recidivism in the Himalayas. China is still working to redraw Himalayan boundaries nearly seven decades after it gobbled up Tibet, an action that led to its occupation of the Switzerland-size Aksai Chin plateau. Aksai Chin fell to what has since become Beijing’s favoured frontier-expansion strategy — “salami slicing”. This involves a steady progression of actions short of war that camouflage offense as defence and help change facts on the ground.

The latest victim of China’s “salami slicing” is one of the world’s smallest countries, Bhutan, which has just 7,500 military personnel. In the past nine months, China — by steadily expanding its troop deployments through new permanent military structures — has gained effective control of much of Doklam, which Bhutan regards as its own territory. Previously, there were no permanent military structures or force deployments on this uninhabited but disputed plateau, which was visited by nomadic shepherds and Bhutanese and Chinese mobile patrols other than in the harsh winter.

Satellite images since last autumn show how rapidly China has expanded its military footprint in Doklam, wreaking environmental degradation in a once-unspoiled place. China’s new control there precludes India intervening again at Bhutan’s behest.

So, just as “China is now capable of controlling the South China Sea in all scenarios short of war with the US”, to quote the admiral in charge of America’s Indo-Pacific naval forces, Beijing today is in a position to call the shots across the Doklam Plateau other than the site where the standoff with India occurred. But right next to the standoff site, located at the plateau’s southwestern corner, China has built military fortifications and facilities overlooking Indian positions.

Yet there is no debate in India on how Doklam was lost. Although the defence minister in March grudgingly admitted China’s construction of helipads and other military structures in Doklam so as to “maintain” troop deployments even in the severe winter, New Delhi has tried to obfuscate the increasing Chinese control of the remote plateau so as not to dilute the “victory” it had sold to the world last summer.

To be sure, India has no territorial claim to any part of Doklam. Also, with Thimphu and New Delhi revising their 1949 treaty in 2007, India has ceded its right to guide Bhutan’s foreign policy. But, as underscored by the Indian Army’s presence in Bhutan, India still has an implicit obligation to defend Bhutan’s territorial integrity. Last summer, it intervened as Bhutan’s patron and de facto security guarantor, driven by the threat to its own security from the Chinese attempt to construct a military road to the strategic Jampheri Ridge, overlooking India’s most vulnerable point — the “Chicken Neck”.

But, a year later, it is apparent that an India increasingly mired in domestic politics has failed both to defend Bhutan’s territorial sovereignty and to thwart the Chinese threat to its “Chicken Neck”. Satellite images show China is building an alternative road from eastern Doklam toward the Jampheri Ridge. So, despite blocking a road construction last summer in Doklam’s southwest, India finds its “Chicken Neck” looking vulnerable again. China, with its extensive new all-weather military infrastructure and forward-deployments in Doklam, is now capable of executing deep incursions into India’s Siliguri Corridor.

Against this backdrop, the silence in India on a fundamentally changed scenario is troubling. The silence indeed is reminiscent of the way Beijing captured Aksai Chin in the mid-1950s while India was chanting the Hindi-Chini bhai bhai mantra. Today, in the absence of an effective strategy against China’s stealth aggression in the Himalayas and its growing inroads in India’s maritime backyard, an increasingly defensive New Delhi has sought to make peace with Beijing.

Make no mistake: The main Doklam lesson is that India’s perennial preoccupation with petty domestic political issues, coupled with its reactive mode due to absence of strategic thinking, allows China to seize the initiative in the Himalayas. More fundamentally, Doklam illustrates that while India may be content with a tactical win, China has the tenacity and guile to outfox its rival and win at the strategic level.

Brahma Chellaney is a geostrategist and author.

The challenge of America’s new extraterritorial sanctions

Posted on June 8, 2018 by Chellaney

The United States, by imposing extraterritorial sanctions, seeks to effectively extend its jurisdiction far beyond its borders. However, such sanctions — which it euphemistically labels “secondary” sanctions — run counter to international law.

BY BRAHMA CHELLANEY, Japan Times

How to navigate America’s new extraterritorial sanctions targeting Iran has become an important diplomatic test for Japan and a number of other important democracies concerned about U.S. President Donald Trump’s pursuit of aggressive unilateralism. Many of these countries have already taken an economic hit, in the form of higher oil-import bills, from Trump’s unilateral pullout from the multilateral nuclear deal with Iran.

The United States has also imposed extraterritorial sanctions to punish the Kremlin for its alleged interference in the 2016 U.S. presidential election. The new Countering America’s Adversaries Through Sanctions Act, or CAASTA, which came into effect on Jan. 29, seeks to stop other countries from making “significant” defense transactions with Russia, a leading arms exporter.

However, with Trump seeking a nuclear deal with North Korea, much of the weight of America’s punitive approach is likely to fall on Iran. Trump, whose main aim is to topple the Iranian regime, said ominously on June 1, “You are going to see how powerful the sanctions are when it comes to Iran.”

The U.S. — armed with not just unmatched military might but also unrivaled financial power from the role of the American dollar as the world’s reserve currency — has the capacity and will to coerce allies and adversaries alike. As the world’s dominant currency that greases the wheels of the global financial system, the dollar equips America with tremendous economic leverage while conferring important advantages to its economy.

By imposing extraterritorial — or, as it likes to euphemistically portray them, “secondary” — sanctions, the U.S. seeks to effectively extend its jurisdiction far beyond its borders. Such sanctions, however, run counter to international law, including the United Nations Charter and the rules of the World Trade Organization.

It is one thing for the U.S. to invoke national security or other grounds as a rationale to impose punitive trade sanctions on a country, including prohibiting American persons and companies from engaging in transactions with the designated state. It is quite another for the U.S. to use extraterritorial sanctions to block trade and financial activities by non-U.S. parties with that country — in other words, to coercively turn national actions into global measures, in breach of the sovereignty of other states.

Through extraterritoriality, the U.S. aims not only to sharpen the impact of its sanctions, but also to advance its own geopolitical and commercial interests. One example is how the U.S. today is ingeniously employing the sanctions threat under CAASTA to wean countries as diverse as India and Turkey off their craving for Russian weapons so as to boost its own arms sales. The U.S. is already the world’s No. 1 exporter of weapons, accounting for 34 percent of all global sales between 2013 and 2017.

In the past, few international players were willing to flout U.S. extraterritorial sanctions for fear of being locked out of the U.S. financial system and barred from doing business with American entities. But Trump’s aggressive unilateralism on matters extending from trade and global warming to Iran and Israel has prompted calls for defiance even by U.S. allies, a number of whom have now been slapped with U.S. steel and aluminum tariffs.

The European Commission has decided to revive its “blocking statute” to prevent European firms from adhering to the new U.S. sanctions against Iran. Originally created in 1996 to counter a U.S. trade embargo on Cuba, the blocking statute bars European Union citizens and companies from complying with the extraterritorial aspects of U.S. sanctions. It also grants EU entities the right to “recover any damages, including legal costs,” from the application of such sanctions and nullifies the effect of any foreign court judgment.

The commission hopes its blocking law will be approved by member-states and take effect before Aug. 6, when the first batch of re-imposed U.S. sanctions against Iran kick in, including on trade in precious metals, coal, aluminum and steel. Trump’s shipping- and petroleum-related sanctions — the second set — are scheduled to enter into force on Nov. 4. But global shipping operators and tanker owners are already pulling back from Iran-related business.

Under Trump’s predecessor, Barack Obama, foreign companies were held hostage by America’s Iran-related extraterritorial sanctions, forcing them to cease or cut oil and other business dealings with Tehran between 2012 and 2015. But the U.S. at that time secured wide support from an international community keen to block Iran from developing nuclear weapons.

This time the U.S. is acting alone. It is seeking to tighten the screws on Iran after having reneged on the Iran deal, despite the International Atomic Energy Agency certifying that Tehran was in compliance with its terms. Indeed, the other signatories to the 2015 Iran deal — France, Germany, Britain, Russia and China — have affirmed their intent to preserve the deal without the U.S.

In this situation, the Trump administration will not find it easy to coerce the rest of the world to comply with its Iran-related sanctions regime. Even Washington’s extraterritorial jurisdictional claim in relation to the Russia-centered CAASTA is being challenged. Turkey, a NATO ally, has threatened reprisals if the U.S. cancels the F-35 fighter-jet deal with it in response to its contract with Moscow to buy the S-400 long-range air and anti-missile defense system. India also appears all set to import the lethal, interceptor-based S-400 system.

On Iran, even if the U.S. succeeds in browbeating some vulnerable countries into abiding by its new sanctions, it will likely find it difficult to secure broad international compliance.

The main buyers of Iranian crude oil and petroleum products are all located in Asia: China, India, Japan and South Korea together account for almost three-quarters of Iran’s oil exports.

China, ever ready to swoop in to exploit opportunities in sanctions-hit countries, will find ways to circumvent the new sanctions, as it did in the previous round, including by boosting imports of Iranian fuel oil. It used the earlier sanctions to deeply penetrate the Iranian economy.

Successive U.S. presidents have helped out China — from aiding its economic rise to making it the key beneficiary of their actions elsewhere. Now it is Trump’s turn: His new sanctions are a diplomatic boon for Beijing, including making a reluctant Iran enter into a tighter Chinese embrace and forcing Russia to pivot to China.

In this light, Japan, India and South Korea, instead of simply succumbing again to America’s Iran sanctions or seeking waivers, should push back with full diplomatic strength, including putting the U.S. on notice that they will challenge its extraterritorial sanctions before the WTO dispute-resolution body.

Seeking deal-related or rolling waivers would be tantamount to adhering to the sanctions. And any waiver will come with conditions that crimp their latitude further.

Past experience indicates that when the U.S. is internationally isolated, it ultimately caves in to the demands of its friends who show resolve to defy its sanctions threat. For example, in 1997, the U.S. reached agreement with the EU to suspend enforcement of the extraterritorial dimensions of its Cuba-related sanctions after the threat of an EU complaint to the WTO.

Today, the U.S. is acting counterproductively to its own interest to safeguard the dollar’s centrality: It is leaving other countries with little choice but to work around its sanctions by using non-dollar currencies so as to avoid the American banking system, besides making alternative arrangements for shipping insurance. This development, and Trump’s other actions, could ensure that the dollar’s days as the world’s reserve currency are numbered.

Make no mistake: International adherence to the new extraterritorial sanctions will only embolden the Trump administration’s defiant unilateralism, which is redolent of China’s unilateralist actions. Broad compliance will not only further weaken the WTO, the U.N. and other international institutions, but also allow Washington to dictate international rules and other countries’ choices. Instead of a rules-based world order, the U.S. and China are seeking to impose a power-based Group of Two order founded on unilateralism.

Brahma Chellaney is a professor of strategic studies at the New Delhi-based Center for Policy Research.

The World According to Trump and Xi

Posted on June 7, 2018 by Chellaney

Trump’s “America First” strategy and Xi’s “Chinese dream” are founded on a common premise: that the world’s two biggest powers can act in their own interest with impunity. The G2 world order that they are creating is hardly an order at all; for everyone else, it’s a trap.

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BRAHMA CHELLANEY, a column internationally syndicated by Project Syndicate

The world’s leading democracy, the United States, is looking increasingly like the world’s biggest and oldest surviving autocracy, China. By pursuing aggressively unilateral policies that flout broad global consensus, President Donald Trump effectively justifies his Chinese counterpart Xi Jinping’s longtime defiance of international law, exacerbating already serious risks to the rules-based world order.

China is aggressively pursuing its territorial claims in the South China Sea – including by militarizing disputed areas and pushing its borders far out into international waters – despite an international arbitral ruling invalidating them. Moreover, the country has weaponized transborder river flows and used trade as an instrument of geo-economic coercion against countries that refuse to toe its line.

The US has often condemned these actions. But, under Trump, those condemnations have lost credibility, and not just because they are interspersed with praise for Xi, whom Trump has called “terrific” and “a great gentleman.” In fact, Trump’s behavior has heightened the sense of US hypocrisy, emboldening China further in its territorial and maritime revisionism in the Indo-Pacific region.

To be sure, the US has long pursued a unilateralist foreign policy, exemplified by George W. Bush’s 2003 invasion of Iraq and Barack Obama’s 2011 overthrow of Muammar el-Qaddafi’s regime in Libya. Although Trump has not (yet) toppled a regime, he has taken the approach of assertive unilateralism several steps further, waging a multi-pronged assault on the international order.

Almost immediately upon entering the White House, Trump withdrew the US from the Trans-Pacific Partnership (TPP), an ambitious 12-country trade and investment agreement brokered by Obama. Soon after, Trump rejected the Paris climate agreement, with its aim to keep global temperatures “well below” 2°C above pre-industrial levels, making the US the only country not participating in that endeavor.

More recently, Trump moved the US embassy in Israel from Tel Aviv to Jerusalem, despite a broad international consensus to determine the contested city’s status within the context of broader negotiations on a settlement of the Israeli-Palestinian conflict. As the embassy was opened, Palestinian residents of Gaza escalated their protests demanding that Palestinian refugees be allowed to return to what is now Israel, prompting Israeli soldiers to kill at least 62 demonstrators and wound more than 1,500 others at the Gaza boundary fence.

Trump shoulders no small share of the blame for these casualties, not to mention the destruction of America’s traditional role as a mediator of the Israeli-Palestinian conflict. The same will go for whatever conflict and instability arises from Trump’s withdrawal from the 2015 Iran nuclear deal despite Iran’s full compliance with its terms.

Trump’s assault on the rules-based order extends also – and ominously – to trade. While Trump has blinked on China by putting on hold his promised sweeping tariffs on Chinese imports to the US, he has attempted to coerce and shame US allies like Japan, India, and South Korea, even though their combined trade surplus with the US – $95.6 billion in 2017 – amounts to about a quarter of China’s.

Trump has forced South Korea to accept a new trade deal, and has sought to squeeze India’s important information technology industry – which generates output worth $150 billion per year – by imposing a restrictive visa policy. As for Japan, last month Trump forced a reluctant Japanese Prime Minister Shinzo Abe to accept a new trade framework that the US views as a precursor to negotiations on a bilateral free-trade agreement.

Japan would prefer the US to rejoin the now-Japan-led TPP, which would ensure greater overall trade liberalization and a more level playing field than a bilateral deal, which the US would try to tilt in its own favor. But Trump – who has also refused to exclude permanently Japan, the European Union, and Canada from his administration’s steel and aluminum tariffs – pays no mind to his allies’ preferences.

Abe, for one, has “endured repeated surprises and slaps” from Trump. And he is not alone. As European Council President Donald Tusk recently put it, “with friends like [Trump], who needs enemies.”

Trump’s trade tactics, aimed at stemming America’s relative economic decline, reflect the same muscular mercantilism that China has used to become rich and powerful. Both countries are now not only actively undermining the rules-based trading system; they seem to be proving that, as long as a country is powerful enough, it can flout shared rules and norms with impunity. In today’s world, it seems, strength respects only strength.

This dynamic can be seen in the way Trump and Xi respond to each other’s unilateralism. When the US deployed its Terminal High Altitude Area Defense system in South Korea, China used its economic leverage to retaliate against South Korea, but not against America.

Likewise, after Trump signed the Taiwan Travel Act, which encourages official visits between the US and the island, China staged war games against Taiwan and bribed the Dominican Republic to break diplomatic ties with the Taiwanese government. The US, however, faced no consequences from China.

As for Trump, while he has pressed China to change its trade policies, he has given Xi a pass on the South China Sea, taking only symbolic steps – such as freedom of navigation operations – against Chinese expansionism. He also stayed silent in March, when Chinese military threats forced Vietnam to halt oil drilling within its own exclusive economic zone. And he chose to remain neutral last summer, when China’s road-building on the disputed Doklam plateau triggered a military standoff with India.

Trump’s “America First” strategy and Xi’s “Chinese dream” are founded on a common premise: that the world’s two biggest powers have complete latitude to act in their own interest. The G2 world order that they are creating is thus hardly an order at all. It is a trap, in which countries are forced to choose between an unpredictable and transactional Trump-led US and an ambitious and predatory China.

Can democracy and communism coexist?

Posted on June 7, 2018 by Chellaney

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Brahma Chellaney, Nikkei Asian Review

When Nepal’s new pro-China communist prime minister, Khadga Prasad Oli, shortly pays obeisance in Beijing, he will seek not only greater aid but also the establishment of “brotherly” relations between the Chinese and Nepalese communist parties.

This year the number of communist-ruled countries in the world increased by one to six, with the landlocked Himalayan state of Nepal joining China, Cuba, Laos, North Korea and Vietnam. Nepal’s two main communist groups merged into one party on May 17, about three months after jointly coming to power.

Nepal boasts the world’s only democratically elected communist government. This development has revived a longstanding international question as to whether communism can reform itself to coexist with democracy. In Nepal, where communist China and democratic India are competing for influence, the answer will be affected by forces far beyond its borders.

Globally, most communist parties gained power by violent means. The Soviet communist system lasted 74 years — the longest any autocracy has survived in modern history — after it was established following two violent revolutions in 1917 that ended Tsarist rule and brought the Bolsheviks and Vladimir Lenin to power. The Chinese Communist Party, in power for almost 69 years, has established a Leninist one-party state that appears set to surpass the Soviet longevity record.

Communist rule in China was built with blood — from the Red Army’s march to victory, which cut a vast swath of death and destruction, to subsequent decades of fratricidal killings in political witch-hunts and other state-sponsored actions, including atrocities against Tibetans, Uighurs and Mongolians and the Tiananmen Square massacre of student-led demonstrators. Mao Zedong’s “Great Leap Forward” caused the Great Famine of 1958 to 1962 that left between 35 million to 45 million people dead. Despite such a gory history, the CCP still retains the reins of power.

The Nepalese communists’ peaceful ascension to power helps to obscure a violent past. Prime Minister Oli spent years in jail in the 1970s and 1980s, as a communist guerrilla, for waging war against the state. Nepal’s 1990 establishment of multiparty democracy within the framework of a constitutional monarchy opened up legitimate political space for all groups, including the Maoists and Oli’s Marxist-Leninist Party. The Maoists, influenced more by Mao’s notion of peasant-based revolution than orthodox Marxism-Leninism, launched a bloody insurrection in 1996 with the aim of overthrowing the monarchy through a “people’s revolution.”

A decade later, a peace accord ended a protracted war between Maoists and government forces. India — governed at that time by a shaky coalition government, dependent on the support of local communists who had links with Nepalese communists — engineered not only the peace but also the abolition of the constitutional monarchy.

These developments paved the way for the Maoists and the Marxist-Leninist Party to share power with the Nepali Congress Party, dominant until then. In 2008, the Maoist chief was appointed prime minister, the first of a series of communists to head coalition governments. Severe political flux resulted in governments changing 10 times in the past decade, a period in which the two communist parties rapidly expanded their political base before sweeping the last national and state elections.

Today, the Nepali Communist Party, which was formed last week when the two communist groups merged, casts a long, ominous shadow over the country’s politics: It has almost two-thirds majority in Parliament and governments in six of the country’s seven provinces. Such domination raises serious risks for Nepal’s sputtering democratic transition, which has been buffeted by one crisis after another.

There are portentous parallels with another country that came under communist sway through largely peaceful but uncommon means centered on a creeping approach exploiting democratic methods — Czechoslovakia after World War II.

Just as national elections in Czechoslovakia in 1946 resulted in leftist and communist parties securing significant representation in the new constituent assembly and then gradually dictating terms to President Eduard Benes, the 2007-initiated constituent assembly process in Nepal helped communists to gain power and leave their imprint on the new constitution that took effect in 2015. And just as U.S. missteps, including terminating a large loan to Czechoslovakia, triggered a backlash that boosted popular support for communists, Indian blunders helped empower communists in Nepal, undermining India’s own close relations with that country.

To gain political ground in the lead-up to the most recent elections, the Nepalese communists played the nationalist card, including whetting a deep-seated suspicion about India’s intentions, in ways redolent of how the Czechoslovak communists whipped up anti-U.S. sentiment and drove out other coalition partners from the government. By 1948, the Czechoslovak communists gained full control of the government.

No less important is the fact that, just as the Soviet Union aided the Czechoslovak communists’ march to victory, China has helped out the Nepalese communists. China reportedly persuaded the divided communists to form a coalition before the Nepalese elections, helped fund their campaign, and midwifed last week’s birth of a new unified communist party.

When history is written, two blunders of India under Prime Minister Manmohan Singh will stand out for irreparably damaging its long-term interests in Nepal — helping to bring the Maoists to the center-stage of Nepalese politics; and instigating the ouster of that country’s more than two-century-old monarchy, the central pillar of stability, continuity and national unity. The void from the monarchy’s fall was largely filled by the communists.

The paradox is that the Maoists secured the monarchy’s overthrow not through their violent campaign but with the direct help of a country they considered their ideological foe. A double irony is that India remains plagued by its own Maoist scourge, unable to halt the rebels’ periodic ambush-killing of police.

A predominantly Hindu India helped turn a Hindu kingdom (indeed the world’s only officially Hindu country) into a secular, communist-ruled, China-leaning state, seriously eroding its own traditional influence there. India and Nepal share one of the world’s most-open borders that permits passport-free passage, and China’s increasing footprint in Nepal carries major implications for India’s internal security.

More broadly, Nepal has emerged as a test case for whether democracy can survive under communist rule. Can communism become democratic? Or is there an inherent contradiction between communism and democracy?

One cannot ignore the fundamental divergences: Democracy enshrines and enhances individual rights and freedoms, while communism erodes and smothers them. Democracy is pluralistic, whereas communism in practice tends to be authoritarian.

Western hope that democracy would follow capitalism into communist states has been dashed. Fusing market capitalism with a one-party state, China has created its own model of authoritarian capitalism, which Vietnam and Laos have embraced and Cuba and North Korea are willing to adopt if the U.S. lifts sanctions against them. The CCP, as revealed by its 2013 circular known as “Document No. 9,” views democracy as China’s biggest threat.

Against this background, can Nepal be an exception? It is too early to determine but initial signs are not encouraging. Oli has already started undermining the independence of Nepal’s institutions and stacking them with his own loyalists. One of his first decisions in office was to replace key figures in many institutions, including those loosely linked with the government. The already weak judiciary is in no position to stand up to the one-party domination. If the assault on institutions continues, Nepal will be emulating the trajectory of how Czechoslovakia turned into a single-party state.

Nepal’s tenuous democracy has also come under pressure from ethnic fault lines that constitution-writing political machinations helped stoke. The new constitution reflects the will of the hill elites that have long dominated Nepal’s power structure. Its enactment has fuelled discontent and unrest among the plains people, who inhabit the southern belt along the India frontier and feel discriminated against. Some of them wish to secede.

Czechoslovakia survived dismemberment by the Nazis and 41 years of communist rule only to split under democracy. In Nepal, communist domination will likely increase southern alienation. Make no mistake: Nepal’s very future is at stake.

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

U.S. extraterritorial sanctions: Begging for a waiver is the worst possible option for India

Posted on May 31, 2018 by Chellaney

Brahma Chellaney, The Times of India

By imposing extraterritorial or “secondary” sanctions, the US seeks to effectively extend its jurisdiction far beyond its borders. Armed with unmatched power from the role of the US dollar as the world’s reserve currency, America has the capacity and will to coerce allies and adversaries alike by threatening to lock them out of the US financial system. But make no mistake: Its extraterritorial sanctions violate international law, the UN Charter and WTO rules.

images India is directly in the crosshairs of the new US extraterritorial sanctions targeting Russia and Iran. India is already suffering the unintended consequences of President Donald Trump’s unilateral withdrawal from the Iran nuclear deal — a pullout that has spurred higher oil-import bills, the rupee’s weakening against the US dollar, and increased foreign-exchange outflows. This is just the latest financial hit India has suffered since 2005 when New Delhi, under US persuasion, voted against Iran in the International Atomic Energy Agency’s governing board, prompting Tehran to cancel a long-term LNG deal favourable to India.

Under Trump’s predecessor, Barack Obama, India was forced between 2012 and 2015 to significantly slash Iranian oil imports and pay Iran in rupees or initiate barter trade. Now India has to readopt those workarounds on payment and shipping insurance because global shipping operators and tanker owners are pulling back from Iran-related business even before the new sanctions take effect on November 4. The sanctions threaten to also impede India’s Pakistan-bypassing transportation corridor to Afghanistan and Central Asia via Iran, including the Chabahar port project.

The India implications of the new Countering America’s Adversaries Through Sanctions Act (CAATSA) are even more stark. While dangling the prospect of securing a “flexible waiver authority” from its Congress, the US intends to use CAATSA to try and wean India gradually off its craving for Russian weapons so as to boost its own arms sales. The US is already the largest arms seller to India. But it basically has been selling defensive systems, including big-ticket items like the P-8I maritime surveillance aircraft and the C-17 Globemaster III and C-130J Super Hercules military transport planes.

Russia, by contrast, has transferred offensive weapon systems to India, including strategic bombers (Sukhi 30MKI), an aircraft carrier (INS Vikramaditya), conventional submarines and a nuclear-powered submarine (INS Chakra). The only foreign power helping India with strategic projects like the Arihant nuclear submarine is Russia, which today is willing to sell India the lethal, interceptor-based S-400 Triumf air defence system and also lease a second nuclear-powered submarine.

On balance, Russia remains India’s most critical defence partner. Yet, through CAATSA, the US is seeking to have a say in India’s defence dealings with Russia. For example, it has signalled its disapproval of the planned S-400 import on grounds that it would thwart building interoperability with Indian forces, as if India is not America’s strategic partner but its client state. The US is ingeniously employing extraterritorial sanctions to advance its geopolitical and commercial interests. But can India tolerate an American veto over its defence deals with Moscow?

How India navigates the new sanctions will be a crucial test of its ability to safeguard an independent foreign policy. External Affairs Minister Sushma Swaraj says, “India follows only UN sanctions, not unilateral sanctions of any country”. But if India seeks deal-related or rolling waivers, it would, in effect, be adhering to the US sanctions. Begging for a waiver is the worst possible choice India can pursue, because it will come with conditions that crimp New Delhi’s latitude further.

India has diplomatic space to rebuff US pressure because the US this time is acting alone, with its own European allies defiant. If India goes ahead with Russian and Iranian deals regardless of the sanctions threat, the US will have little choice but to exempt India without conditions. India should partner other key democracies to push back with full diplomatic strength, including, if necessary, hauling the US into the WTO dispute-resolution body and introducing a UN General Assembly resolution against unlawful extraterritorial sanctions. The main beneficiary of the new US sanctions, of course, will be China, ever ready to capitalize on opportunities in sanctions-hit countries.

The writer is a geostrategist and author.