SEA CHANGE
EVOLVING MARITIME GEOPOLITICS IN THE INDO-PACIFIC REGION
edited by David Michel and Ricky Passarelli
STIMSON CENTER | 1
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S
SEA CHANGE
EVOLVING MARITIME GEOPOLITICS IN THE INDO-PACIFIC REGION
edited by David Michel and Ricky Passarelli
DECEMBER 2014
Contents
Preface 9
Introduction 11
Diane French, David Michel, and Ricky Passarelli
he Indo-Paciic Region and the Rise of
Transnational Maritime hreats and Challenges 19
P.K. Ghosh
US Maritime Security Relations and Partnerships in the Indo-Paciic:
Opportunities for Enhanced Cooperation 31
Scott Cheney-Peters
India’s Evolving Security Relations and Partnerships in the Indo-Paciic 45
W. Lawrence S. Prabhakar
Island States in a Region of Great Powers 61
Nilanthi Samaranayake
he Changing Balance of Power in the Indian Ocean:
Prospects for a Signiicant Chinese Naval Presence 71
David Brewster
Energy Exploration, Exploitation, and Exports in the Indo-Paciic Region 81
Dan Millison
Shipping Developments and Challenges in the Indo-Paciic Maritime Realm 95
Rupert Herbert-Burns
Fisheries, Food Security, and Climate Change in the Indo-Paciic Region 111
David Michel
A Strategy for Securing the Maritime Commons 123
Girish Gujar, P.K. Ghosh and Hong Yan
STIMSON CENTER | 7
Preface
Sea Change: Evolving Maritime Geopolitics in the Indo-Paciic Region began in the fall
of 2013 when the US-based Stimson Center partnered with India’s Observer Research
Foundation (ORF) to launch a research initiative analyzing the maritime policy challenges
and opportunities arising across the Indian Ocean and the Western Paciic as these areas
emerge as central theaters of 21st century geopolitics In particular, the project aimed to
illuminate the evolving role that the waters, shipping lanes, and natural resources of the
Indo-Paciic will play in shaping relationships between major regional and extra-regional
powers while also examining the various ways that energy exploration and exploitation,
infrastructure development, and environmental pressures will impact the Indo-Paciic littoral in the coming years and decades
To help frame these issues, Stimson and ORF, in association with the US Consulate
General in Chennai, India, convened a three-day workshop, entitled “Sea Change: Evolving
Maritime Geopolitics in the Indo-Paciic Region,” over the course of two related sessions,
one in Chennai from June 10 to 11, 2014, and the second in Kochi on June 12, 2014
he conference brought together senior oicials, business leaders, academic analysts, military representatives, and energy and shipping industry experts from India, the United States,
Australia, China, Japan and the broader Indo-Paciic region to elucidate the salient strategic,
socio-economic, commercial, and environmental trends afecting the region and examine
their implications for decision makers Together, participants engaged topics such as the strategic outlooks of various states, the shiting maritime security risks confronting the region,
the existing institutional and legal structures in place to face such challenges, the dynamics
of Indo-Paciic maritime trade, rising strains on environmental and natural resource issues,
and the role and politics of regional organizations he conference provided a valuable venue
for policy makers and stakeholders to debate their various interests and priorities, exchange
views, discuss mutual concerns, and forge shared objectives his volume features papers developed at the “Sea Change” conference, presented with an ultimate view to ofer practical
perspectives on future policy directions, and to spur further dialogue and debate
he Stimson Center is grateful to the US Consulate Chennai for its generous inancial
support and to all of the conference participants for their energy and commitment Stimson
is also indebted to its partners at the Observer Research Foundation for their invaluable collaboration throughout We especially thank PK Ghosh, Darshana Baruah, Uma
Purushothaman, Abhijit Iyer-Mitra, and Samir Saran for sharing in this endeavor Stimson
also thanks the communications, development, and project management staf, particularly
Jim Baird, Francene Blythe, Kyla McKenna, Alla Polyakova, Peter Toto, our interns Owen
McAleer and Diane French, and the indispensable Lita Ledesma for their critical contributions to the success of this project
David Michel
Director, Environmental Security Program
Stimson Center
November 2014
STIMSON CENTER | 9
Preface
10 | SEA CHANGE
Introduction
Diane French, David Michel, and Ricky Passarelli
he waters of the Indo-Paciic region represent an increasingly critical arena for maritime
geopolitics, security, trade, and environmental policy action—issues that have transformed
the region into a major crossroads of international relations he vast Indian Ocean and
western Paciic are drawn together by natural resource lows, globalized supply chains,
and international distribution networks At the same time, Indo-Paciic littoral states face
signiicant policy and governance challenges from multiple sources, including territorial
disputes and prospective rivalries among naval powers, intensifying environmental pressures on marine and coastal infrastructure and resources, piracy and traicking on the
open ocean, and weak and failing states on shore
he interplay of overlapping and intersecting interests in the Indo-Paciic region undergirds
a complex strategic environment characterized by growth and integration as well as potential
for conlict and vulnerability Increasing exchanges of goods, people, and ideas throughout the
region have spurred vital economic and social growth, both within and between countries But
certain risks may accompany these rewards Greater interdependence entails possible vulnerabilities Essential sea lanes also represent potential chokepoints Developing natural resources
may endanger the natural environment New security risks low from the pressures of climate
change and asymmetric threats, such as piracy and terrorism To navigate the complicated maritime realm of the Indo-Paciic, policy makers throughout the region will need to collaboratively
develop strategies to address these interconnected strategic, socio-economic, commercial, and
environmental trends that will continue to shape the region in the coming decades
Strategic Perspectives
Varying strategic perspectives on the importance of the Indo-Paciic have been developed
by a diverse set of regional actors, including the United States, India, China, Australia,
Indonesia, and Japan his shit of the United States and other countries toward the Indian
Ocean region has been driven by the dramatic economic growth of China, the steady rise
of India’s trade and productivity, the increased importance of raw materials and resource
extraction from developing countries, and the escalating crude oil exports of the Middle
East to Asia Accelerating rates of change have created a rapidly evolving security landscape characterized by both of sot and hard power, ranging from maritime partnerships
and trade initiatives, to bilateral and multilateral disaster management exercises, to active
eforts to demonstrate sea control and credible combat power
he recent strategic rebalance of the United States towards the Asia-Paciic has included a
strong naval presence serving several purposes Among major US interests are guaranteeing
the freedom of navigation for energy and commercial trade, ensuring a stable balance of power,
monitoring and deterring threats from actors such as Iran and North Korea, and directing
various maritime security operations such as counter-terrorist, counter-traicking, and counter-piracy missions Meanwhile, China and India have sought to thread a needle between their
strategic cooperative and competitive relations A host of economic and political interests, and
an expanding web of bilateral and multilateral interactions around the region, have changed
perceptions both between the two Asian giants and with regards to the United States
STIMSON CENTER | 11
Introduction
In addition to the interlocking rivalries and relations of China, India, and the United States,
the region’s dynamics are also determined in good part by the interests and inluence of
other major countries sharing the Indo-Paciic littoral such as Australia, Indonesia, Japan,
Malaysia, hailand, Somalia, South Africa, and Saudi Arabia Such nations have strategic
interests not only in militarily protecting their coasts, but in protecting their coastal ecosystems, isheries, coral reefs, and man-made infrastructure from exploitation, degradation, and rising sea levels At sea, strategic interests in energy acquisition have also led to
an expansion of international oil and gas exploration, development, and trade and opened
pathways for both cooperation and competition across the region
Maritime Security Challenges
Increased activity throughout the Indo-Paciic due to expanding regional and global trade
in goods, ideas, people, and resources has raised a new set of maritime security challenges Historical state-based concerns such as geopolitical fragility, internal political upheaval, insurgency, inter-state tensions, sea-lane security, and territorial disputes are now
coupled with growing threats from non-state sources and asymmetric risks1 Among these
are growing risks from non-state actors including piracy, terrorism, and traicking; the
impacts of environmental degradation, resource depletion, climate change, and natural
disasters; and weak states and failing institutions hese diverse challenges confront an
equally diverse set of nations bordering this region, ranging from prosperous states with
strong rule of law to low-income countries with feeble or fragmented governance structures
Such diversity in interests and capabilities saddles the Indo-Paciic region with political
tensions and brings with it a greater danger of instability and conlict
In 2013, according to the Heidelberg Institute for International Conlict Research, a total of 182
conlicts were documented involving the littoral states of the Indian Ocean and western Paciic,
representing 44 percent of the 414 conlicts observed worldwide, including 11 of the globe’s 20
wars2 he vast majority of these clashes concern land-based interests Yet the Indo-Paciic is also
home to a number of prominent maritime territorial disputes, most notably in the South China
Sea Historically, these conlicts, although not infrequent, have largely been managed peacefully
Several, however, have the potential to become lashpoints for violence Peaceful resolution of
such conlicts can be promoted through international law, particularly the 1982 United Nations
Convention on the Law of the Sea (UNCLOS), which plays a pivotal role in the region despite
the lack of ratiication by the United States Legal measures must also be combined with policy
initiatives that demonstrate consistency, creativity, durability, and adequate resource availability
A combination of these legal, naval, and policy measures can ensure Indo-Paciic nations act as
capable, adaptive partners rather than disputatious, tense competitors
Even as international territorial quarrels simmer, perils presented by non-state actors persist
Piracy and armed robbery—particularly of the Somali coast and in and around the Straits
of Malacca—remain of such signiicant concern that many merchant vessels navigating these
areas have hired private armed security teams he inability of national and international
forces to deinitively secure the vast Indian Ocean has also allowed for the sustained traicking of illicit narcotics, weapons, and people, along with the transport of common contraband
such as oil, cigarettes, charcoal, khat, and endangered species As with piracy and traicking,
tackling threats from groups such as al Qaeda in the Arabian Peninsula, the Abdallah Azzam
Brigades, and al Shabaab will require both strategic intelligence and tactical capabilities
12 | SEA CHANGE
Diane French, David Michel, and Ricky Passarelli
Maritime Security Structures
Most regional players in the Indo-Paciic share common goals of economic, political, and
environmental stability How they seek to ensure these measures of stability, however,
difers across countries Actions undertaken by the United States have sought to achieve
stability through capacity building and regional cooperation, when possible, and deterrence
when necessary Capacity building measures, such as inancial aid, asset provision, military
training and education, and regional cooperation schemes, such as multilateral exercises,
information sharing, and joint patrols, have been implemented in partnership with South
Korea, Australia, New Zealand, Indonesia, Japan, the Philippines, Vietnam, Malaysia, and
India Deterrence strategies, on the other hand, have played a role in US relations with Iran,
North Korea, and notably, China
Unlike the formal security frameworks initiated by the United States, relations between
India and other Indo-Paciic countries have mostly take the form of informal bilateral and
multilateral partnerships his has allowed India to cultivate an autonomous perspective
as a “swing state”—a strategy conducive with its overall policy of nonalignment Such
lexible strategies have been pursued with India’s immediate neighbors of Singapore and
Malaysia, its intermediate neighbors of Indonesia and Vietnam, and its extended neighbors
of Australia, New Zealand, South Korea, Japan, Russia, and the US India’s engagement in
the Indo-Paciic, built upon its own growing economic power, commercial investments, and
regional trade interdependence, and combined with its expanding naval power, potentially
position it to play a prominent, stabilizing role between the growing strategic assertiveness
of China and the formal engagement of the United States
Signiicant relationships have not only developed between great powers in the region, but also
between smaller states, notably the numerous island nations United by the shared threats of
rising sea levels, fragile coastal ecosystems, and vulnerable infrastructure, island nations have
displayed a common need for capacity building during crises and harbored common concerns
about the inluence of foreign powers over land and ocean territory Indeed, their strategic
locations and valuable resources place island states in a powerful position to lend unique
expertise and resources to larger powers and to shape or disrupt regional power dynamics
Indo-Pacific Maritime Highway
For centuries, the islands and mainlands of the Indo-Paciic were simply features of the
Indian Ocean thoroughfare Today, increasing lows of commerce, investment, and people
are linking the Indian Ocean and Paciic nations together and to the rest of the world as part
of an emerging global trading network he Indian Ocean region has long been the primary
artery for pumping oil from the Persian Gulf into the global economy More recently, the
Indo-Paciic has been primed to beneit from the expansion of ofshore oil and gas exploration, and development along the eastern coast of Africa, as well as of of Myanmar and
Vietnam Its position as the principal conveyor belt for the international coal trade, and its
broader geostrategic standing at the intersection of modern economic, natural resource,
and environmental issues, likewise adds to the region’s economic value
he Indo-Paciic’s rising geostrategic proile has boosted demand for maritime activity
and infrastructure throughout the region his has, in turn, resulted in the development
STIMSON CENTER | 13
Introduction
of regional industrial hubs, the enabling of technological innovation, the stimulation of
regional growth, the facilitation of world trade lows, the formation of global shipping alliances, and an overall upsurge in regional living standards
Port and maritime development, however, can come with their own costs, particularly
given the broader geopolitical and environmental circumstances of the region he existing
threats of armed robbery, kidnapping, and sabotage from pirates, organized criminal gangs,
and terrorist networks, are likely to increase as the region’s ofshore industry expands and
the development of possible targets increases Simultaneously, around the Indo-Paciic,
demand for coastal development of aquaculture, roads, buildings, and expanding urban
infrastructure exacerbates the degradation of mangroves, coral reefs, wetlands, and other
ecological habitats3 Environmental threats like rising sea levels have highlighted the vulnerabilities of the region’s growing maritime infrastructure One vulnerability analysis of
global warming determined that iteen of the twenty port cities around the world with
the greatest populations exposed to climate threats by 2070 are in the Indo-Paciic littoral
hirteen Indo-Paciic port cities rank among the twenty worldwide with the largest value
of assets at risk over this time4 In the face of these risks, by global comparison, Indo-Paciic
ports remain among the least resilient and well-adapted to evolving climate threats
Natural Resources and Environmental Challenges
Climate change endangers not only port and maritime infrastructure in the Indian Ocean
region, but also ocean environmental systems and human well-being he Intergovernmental
Panel on Climate Change’s Fith Assessment Report published in 2013 stated with “high
conidence” that “the rate of sea level rise since the mid-19th century has been larger than
the mean rate during the previous two millennia” and that “it is virtually certain that
the upper ocean (0-700 meters) warmed from 1971 to 2010”5 In addition to the exposure
of coastal assets and urban infrastructure, rising sea levels and climate change threaten
coastal regions with habitat destruction, biodiversity loss, shoreline erosion, saltwater intrusion into rivers and freshwater aquifers, severe storm surges, and the forced displacement
and migration of populations, particularly of low-lying island nations like Mauritius, the
Maldives, and Seychelles
Rising sea levels and ocean warming, coupled with additional stressors such as weak management, pollution, and resource exploitation, have the potential to drastically harm human
well-being hus, for example, food security, economic security, and regional security are
closely linked to isheries, which sustain the livelihoods of more than 38 million people
worldwide6 Indo-Paciic isheries alone exported 7 million tons of catch (~US$273 million)
in 20117 Fisheries in the Indo-Paciic are inluenced by dynamic factors such as trade access,
governance, security, and climate change, while weak governance and lack of efective
management have created an “open access system” plagued with illegal, unregulated, and
unreported (IUU) ishing Accompanying regional security concerns, such as the use of
ishing vessels for piracy, terrorism, traicking, organized crime, and prostitution, as well as
direct conlict over resources, territory, and maritime boundaries, have further exacerbated
these trends Without an efective management system and legal framework, issues of water
pollution, rising water temperatures, ocean acidiication, and IUU ishing have the potential
to devastate Indo-Paciic isheries and, consequently, the physical health, socio-economic
well-being, and overall security of local populations
14 | SEA CHANGE
Diane French, David Michel, and Ricky Passarelli
Livelihoods in the Indo-Paciic are also afected by energy resources, which literally fuel political
and economic interactions in the region Indo-Paciic states together boast 58% of the world’s
proven oil reserves and 46% of global gas reserves8 A critical constraint, therefore, is not total
resource availability, but rather the existence of “choke points” in the transportation and delivery
steps of the resource supply chains, particularly those supplying poor consumers While some
countries, such as China, have made strategic investments in oil and gas pipelines, several large
South Asian consumers, including Bangladesh, India, and Pakistan, lack cross-border connections to major oil and gas producing countries Shortcomings in port and trans-shipment capacity have also been cited as potential blockades to meeting predicted future demand for coal
consumption, incentivizing investment in alternative power generation sources
Many individual countries in the Indo-Paciic region are faced with the similar environmental challenges, yet they lack a common regional policy framework for addressing or
attempting to solve them While there may be no “one-size-its-all” solution for the entire
region, a holistic framework and management approach could facilitate integration, communication, negotiation, data sharing, technology transfer, and best practice dissemination
among actors and stakeholders across various levels, sectors, and locations
International Orders in the Indo-Pacific
In the face of varied and heightened threats in the Indian Ocean region, there have arisen
increased opportunities for both cooperation and competition Indeed, prospects for peace
in the maritime environment of the Indo-Paciic depend largely on mutual understanding,
cooperation, and constructive engagement Several regional political, economic, development, and security forums maintain an active role in the Indo-Paciic, including the
Arab League, Southern African Development Community (SADC), Gulf Cooperation
Council (GCC), Indian Ocean Rim Association (IORA), Western Paciic Naval Symposium
(WPNS), Indian Ocean Naval Symposium (IONS), IBSA (India, Brazil, South Africa)
Dialogue Forum, Association of Southeast Asian Nations (ASEAN), East Asia Summit,
and Six-Party Talks In addition to regional organizations, several international inter-governmental organizations such as the International Maritime Organization (IMO), Food
and Agriculture Organization (FAO), and UN Environment Programme (UNEP), serve
to help states manage the maritime environment and ocean resources Such regional and
functional organizations can facilitate the development of binding multilateral agreements
to protect nations from environmental threats
From a legal perspective, there are a number of existing frameworks governing maritime
activity in the Indo-Paciic, including, most notably, the United Nations Convention on the
Law of the Sea hough not ratiied by the United States, UNCLOS has been ratiied by most
Indo-Paciic countries and serves to provide a framework for agreements, organizations,
and activities, including those addressing territorial claims, managing ish stocks, developing minerals outside of national jurisdiction, and implementing of environmental pacts and
security partnerships negotiated through other regional bodies he arbitration panels and
mechanisms of UNCLOS work to resolve various multinational and transboundary maritime disputes, such as issues of coastal security, freedom of navigation, traditional ishing
rights, piracy, maritime terrorism, conservation, the exploitation of non-living resources,
marine pollution, and maritime delimitation9 hough not a panacea, legal, regional, and
STIMSON CENTER | 15
Introduction
non-governmental organizations have a valuable role to play in ensuring the sustained livelihood and security of the Indo-Paciic and can provide a stable framework for addressing
the rapidly evolving maritime geopolitics of the region
Conclusion
Along with formal institutions, less formal arrangements have a decidedly powerful role
to play in facilitating open dialogue, stakeholder collaboration, information sharing, and
collaborative policy analysis It is with these aims in mind that the Stimson Center in the
United States and the Observer Research Foundation (ORF) in India partnered in June
2014 to host the maritime trade and security conference “Sea Change: Evolving Maritime
Geopolitics in the Indo-Paciic Region” Maritime geopolitics is a complicated function of
security, political, economic, and environmental considerations As such, its discussion
requires a forum capable of spanning both traditional and non-traditional security challenges, across boundaries and among a variety of actors
With a history of providing pragmatic solutions to global security challenges and deep roots
in the South Asian and Indo-Paciic policy communities, the Stimson Center has been able
to successfully engage a diverse group of stakeholders from government, military, business,
civil society, and academic backgrounds in exploring the prominent strategic, socio-economic, commercial, and environmental trends that will shape the region in future years
Stimson and ORF have worked toward the ultimate goal of advancing awareness of essential
Indo-Paciic maritime policy issues, stimulating further exploration of ongoing dynamics,
and establishing fruitful connections and cooperation between governments, think tanks,
research institutions, business associations, and civil society organizations engaged in the
policy communities of India, the US, and the greater Indo-Paciic region In this spirit, the
papers presented in this volume serve not only as a singular forum for engaged discussion
of Indo-Paciic strategic perspectives, security challenges, trade, environmental considerations, and international order, but as a starting point for further interdisciplinary analysis,
exchange, and transboundary collaboration both within the region and worldwide
About the Authors
Diane French is an intern with the Environmental Security program at the Stimson
Center She holds a BA in Politics from Princeton University and will complete an MA in
International Relations and International Economics from he Johns Hopkins University
School of Advanced International Studies in May 2015
David Michel is a Senior Associate and Director of the Environmental Security Program
at he Stimson Center His work explores emerging governance challenges and security
risks posed by global environmental change Michel has written widely on transboundary
water resources management, maritime policy, the international impacts and implications
of global warming, and on the possibilities for collective institutions to address common
environmental problems He has advised the National Intelligence Council and the US
Departments of Defense, Energy, and State on water security and climate policy issues He
lectures frequently on environmental security at universities in the US and abroad, and
has consulted with NGOs and the private sector on the international climate negotiations
16 | SEA CHANGE
Diane French, David Michel, and Ricky Passarelli
process, isheries, and water resources Prior to joining Stimson in 2008, Michel served as
senior associate with the Center for Transatlantic Relations at Johns Hopkins (SAIS) He
was educated at Yale University, the École des Hautes Études en Sciences Sociales in Paris,
and he Johns Hopkins University School of Advanced International Studies
Ricky Passarelli is a research associate with the Environmental Security program at the
Stimson Center His work looks to mitigate global conlicts that arise over shared water resources, environmental degradation, urbanization, and food security With a background
in civil engineering, he is particularly interested in how an improved understanding of environmental systems can inluence infrastructure and urban design decisions His previous
research has looked at community-based project design and point-of-use water treatment
in rural Africa Ricky holds both a BS in Civil Engineering and a Master’s in Urban and
Environmental Planning from the University of Virginia
Notes
1 See, eg, David Michel and Russell Sticklor, eds Indian Ocean Rising: Maritime Security and Policy
Challenges (Washington, DC: Stimson, 2012), at http://wwwstimsonorg/images/uploads/research-pdfs/
Book_IOR_2pdf; Mohan Malik, ed Maritime Security in the Indo-Paciic (Lanham, MD: Rowman &
Littleield, 2014)
2 Heidelberg Institute for International Conlict Research, Conlict Barometer 2013 (Heidelberg, Germany:
HIIK, 2013), at http://wwwhiikde/en/konliktbarometer/
3 Don Hinrichsen, he Atlas of Coasts and Oceans: Ecosystems, hreatened Resources, Marine Conservation
(Chicago: University of Chicago Press, 2011)
4 RJ Nicholls et al, Ranking Port Cities with High Exposure and Vulnerability to Climate Change (Paris:
OECD, 2008), at http://dxdoiorg/101787/011766488208
5 Intergovernmental Panel on Climate Change (IPCC), Climate Change 2013: he Physical Science
Basis—Working Group I Contribution to the Fith Assessment Report of the Intergovernmental Panel on
Climate Change (Summary for Policymakers) (Geneva: IPCC, 2013), p 9, at http://wwwipccch/pdf/
assessment-report/ar5/wg1/WGIAR5_SPM_brochure_enpdf
6 Cassandra De Young, ed Review of the State of World Marine Capture Fisheries Management: Indian
Ocean (Rome: Food and Agriculture Organization of the United Nations, 2006), at http://wwwfaoorg/
docrep/009/a0477e/a0477e00htm#Contents
7 Mary Ann Palma-Robles, “Fisheries and Security in the Indo-Paciic” (presentation, Sea Change: Evolving
Maritime Geopolitics in the Indo-Paciic Region, Chennai, India, July 11, 2014), at http://wwwstimsonorg/
images/uploads/palma-roblesisheriesandsecuirtypdf
8 BP plc, BP Statistical Review of World Energy (London: BP, 2011), pp6-20, http://wwwbpcom/content/
dam/bp-country/de_de/PDFs/brochures/statistical_review_of_world_energy_full_report_2011pdf
9 See Caitlyn Antrim, “International Law and Order: he Indian Ocean and South China Sea,” in Indian
Ocean Rising
STIMSON CENTER | 17
Introduction
The Indo-Pacific Region and the Rise of
Transnational Maritime Threats and Challenges
P.K. Ghosh
he Indo-Paciic region has been witness to extensive “proxy politics” during the Cold war
era However, currently its importance has been highlighted by the fact that the trajectory
of maritime geopolitics in the region will herald the global politics of the 21st Century
Host to a spectrum of activities ranging from trade to transportation, the region also gains
salience due to its emergence as the highway for important energy transfers to the energy
hungry nations of the world It is also a region that is alive to political turbulence and a
complex jostle for power he deep desire of the populous Asian states to play a more prominent role either at the regional level or at the global plane has ensured a struggle for power
in the entire region that has become accentuated over time—especially with the perceived
erosion of US primacy and the emergence of new nodes of power throughout the area1
he erosion may be notional and also debatable, but the jostle is extant with major players
seeking primacy along with that of the US he list of serious contenders includes India and
China, with countries such as Australia, Indonesia, and South Africa also in the fray playing
the role of a king-maker his dynamic scenario, however, has also highlighted distrust
amongst the littoral nations, which in many ways has prevented the creation of an overall
security architecture despite similar security priorities and, most importantly, a common
maritime thread which runs through the region
he current accent on increasing globalization in the economic ield has brought about attendant maritime security concerns hus, with a rising trajectory of sea-borne trade, there
seems to be an increase in asymmetric threats arising from transnational crime like modern
piracy, terrorism, drug running, etc, in their ever-evolving manifestations Consequently,
this rise has lead to strident calls for more efective law enforcement and maintenance of
maritime order by all stakeholders
Difering deinitional approaches have attempted to delineate the geographical ambit of the
Indo-Paciic region, creating a debate about precise geographic boundaries Whatever may be
the precise interpretation of the region, the unitary factor that threads all the littorals together
has been their dependence on sea-borne trade for their existence Unfortunately, despite the
primacy of the oceans, sea governance and a uniied approach towards overcoming myriad
maritime threats and challenges have not received the importance that they deserve
Prima facie, the rationale for this seemingly ironical situation may lie in the fact that there
exist considerable dissimilarities between capabilities of the littorals India has its large navy
with near blue water lies on one hand while there are others that possess limited capacities
Secondly, it may be due to the divergence of interests and national priorities on issues connected with maritime security and ocean governance
As mentioned, there exists no singular supranational organization which focuses on maritime security and cooperation in the region With the Association of Southeast Asian
Nations (ASEAN) being primarily an economic forum that has security outgrowths like the
STIMSON CENTER | 19
The Indo-Pacific Region and the Rise of Transnational Maritime Threats and Challenges
ARF (ASEAN Regional Forum), the nearest forum with supra national characteristics that
happens to be restricted in its ambit to the Indian Ocean Region (IOR)—the Indian Ocean
Rim Association for Regional Cooperation (IOR–ARC)—came into existence in Mauritius
on March 5th, 1997 and had totally ignored the issue of maritime security cooperation—
until recently, when it realized its importance Even though the charter of the association
did not mention maritime cooperation, a turnaround in focus and accent has ensured that
maritime security has emerged as the top agenda on the table of the forum
SLOCs Security
Economic globalization has led to more than 80 percent of world trade being conducted
through the seas Since most of the trade in the Indo-Paciic region is sea-borne, the seas effectively form the lifelines for the littoral states With Sea Lines of Communication (SLOCs)
forming the oceanic highways for the movement of merchant ships, SLOC security has
emerged as a primary concern for most nations
According to a World Bank projection, the global sea-borne trade that stood at around
21,480 billion ton-miles in 1999 was expected to rise by linear projection to 41,800 billion
ton-miles by 20142 However, the global inancial meltdown of 2008-09 displaced the expected boom A P Moller-Mærsk A/S, owners of the largest container leet in the world, estimate that container handling fell by 10 percent in 2009—the irst decline since containers
were introduced on global shipping routes in the 1970s3 However, in a slow turn around, a
growth of 2 percent in global shipping happened from 2010 his resulted in an 86 percent
growth in the world leet4 Subsequently, world sea-borne trade grew by 4 percent in 2011,
taking the total volume of goods loaded worldwide to 87 billion tons5
With nearly 100,000 ships transiting the expanse of the Indian Ocean annually, it is easy to
predict that the Indian Ocean is a trade busy ocean Roughly 40 percent of this sea-borne
trade is accounted for by the Straits of Malacca Every day 155 million barrels of oil, or 40
percent of the entire global oil trade, pass through the Straits of Hormuz, and 11 million
barrels of oil pass through the Malacca and Singapore Straits
In this context, the “energy demand heartland” of Asia, comprised of countries that are
heavily dependent on energy imports like India, China,6 and Japan, has led to a realization
that SLOC security and energy security are closely interlinked and that the freedom of
SLOCs and the energy lifelines form an important national objective
Primary Maritime Threats
he rising asymmetric maritime threats have been linked in many ways to the rise in seaborne trade, thus afecting the security and the free low of trade through the maritime
commons he capacity to restrict the free low of trade has had many direct and indirect
consequential efects Indirectly, for example, the rising risk factor of a certain area can duly
enhance insurance premiums for merchant ships, automatically reducing the low of shipborne trade, thus diminishing the economic indices of a dependent state, in turn afecting
its economic development An overview of these serious challenges includes:
20 | SEA CHANGE
P.K. Ghosh
Piracy
Piracy, that until recently had been dismissed as “romantic folklore,” has returned with a
vengeance and has emerged as the bane of the modern seafarer his transnational crime
has made considerable impact on commercial shipping, especially on those vessels passing
through some of the piracy hotspots in the region like the Horn of Africa
Earlier, piracy was rife in the Malacca straits and in Indonesian waters However, multipronged efforts, along with initiatives like the Regional Cooperation Agreement on
Combating Piracy and Armed Robbery (ReCAAP), or the Tokyo Agreement of November
11, 2004, and awareness programs have led to a near elimination of this scourge from the
Straits, though a few attacks continue in the South China Sea
Modern piracy emerging from Somalia, though, has captured the attention of the global
shipping community and the media Modern piracy is a complex problem that is oten the
manifestation of various underlying socio-political problems Hence piracy emanating
from one area is oten unique in its approach and distinct from piracy incidents in other
regions of the world he solution to eradicating this scourge does not exclusively lie at sea
and requires a multi-faceted approach to tackle the root of the problem, rather than focus
on an exclusively naval solution to merely suppress the problem
From modest beginnings in 2005, Somali piracy has evolved considerably, from attempts
by ishermen to collect “tax” from traversing ships to the current format in which it has
emerged as a lucrative criminal industry with transnational characteristics he main objective of the Somali pirates is to get ransom money from shipping companies by holding
the crew and cargo hostage
Initial inability to bring down the numbers of piracy incidents forced the UN to adopt
Resolution 1851(2009) in January 2009 his resolution also established the contact group
on piracy of the coast of Somalia Today its membership has grown from 30 countries to
more than 50 and it includes six international organizations7 With the increased presence
of military ships and various task forces, the numbers of piracy attacks are on a sharp
decline, much to the satisfaction of the governments that have opted for the usage of military force against this socio-economic problem
his accent on using navies to curtail piracy instead of going to the root causes is a temporary
respite Due to the pressure near the coastline of Somalia (and Puntland), the pirates have
started using sophisticated equipment which enables them to carry out attacks at phenomenal
ranges of 1,500 nautical miles (nm) from the Somali coastline Hence there is a likelihood that
once the navies stop or reduce their patrol intensity, piracy will rise again In addition, the
Somali pirates are also actively enhancing their linkages with terrorist organizations like Al
Qaida and Al Shabab he latter has been keen to set up their sea-based wing along the lines
of the former Sri Lankan secessionist Liberation Tigers of Tamil Eelam (LTTE) Sea Tigers,
and have been training former pirates for establishing the new wing8
Military Efforts against Somali Piracy
Most governments and stakeholders have encouraged the use of military force to solve
Somali piracy—a transnational socio-economic crime his has led to the Horn of Africa
STIMSON CENTER | 21
The Indo-Pacific Region and the Rise of Transnational Maritime Threats and Challenges
becoming host to a large number of warships from diferent countries operating in the
area Some of these warships operate in Task Groups, while others have been operating individually he primary aim of all these naval forces is to prevent incidents of piracy from
occurring and to ensure the safe passage of merchant shipping through the region
However, many of these naval vessels are constrained due to numerous reasons Amorphous
rules of engagement (ROEs) and lack of sharing of actionable information between individual warships and Task Groups have compounded the problem Admittedly, most operating
forces vehemently disagree and suggest that information sharing has been smooth, but onthe-ground evidence suggests otherwise Undoubtedly, there exist a number of formal and
informal information sharing initiatives (like the US driven SHADES) that seek to enhance
exchange of actionable information in the vast sea area—but they have their own limitations
Apart from this there exists considerable diiculty in prosecuting the captured pirates or
taking them back to their own country for standing trial due poor or nonexistent local legislation against piracy Attempts by some special forces of the military to liquidate captured
pirates have been frowned upon by human rights organizations and by the Transitional
Federal Government of Somalia Countries like Seychelles (earlier Kenya was included)
that were willing to accept captured pirates for prosecution are under strain due to a lack
of inancial assistance from Western nations and stretching of their judicial infrastructure
However, this scenario has witnessed some change, and many countries, including India,
have tried to create national legislation9 that would be able to deal with modern piracy in
their own courts efectively
he main naval task forces that operate in the region include the:
Coalition Task Force 151 (CTF 151) his Task Force was established in January 2009 with
a mandate to combat piracy in the Gulf of Aden It comprises countries engaged with the
Coalition Maritime Force (CMF) and includes Germany, the UK, Turkey, Pakistan, etc,
and functions as part of the US initiative
Operation “Atlanta” European Union Naval Force (EUNAVFOR) his EU naval force in the
area was launched in December of 2008 in accordance with United Nations Security Council
Resolutions 1814, 1816, and 1838, and is based at the Northwood Operation Headquarters in
Britain It has about six ships from 27 members of the EU which maintain a convoy escort
system codenamed Operation “Atlanta” and is run under the auspices of the European
Security and Defence Policy he primary mission of this force is to protect the delivery of
food aid to Somalia under the World Food Programme of the United Nations It is also tasked
to prevent acts of piracy in the region and protect merchant ships in the area
Operation “Ocean Shield” by NATO A Standing NATO Maritime Group (SNMG)10 comprised of about seven ships from Italy, Germany, Greece, Turkey, the UK, the USA, and
Spain has been deployed to allow the World Food Organization to fulill its mission of providing humanitarian aid to Somalia under the UN World Food Programme his operation
has been codenamed “Ocean Shield”
Many counties have chosen to deploy warships for carrying out anti-piracy operations and
patrols independently heir primary aim has been to ensure safety of the merchant ships
22 | SEA CHANGE
P.K. Ghosh
lying their state lag—and as an associated operation also to help other ships in the area
hese countries include China, Russia, India, Iran, Japan, South Korea, etc It is noteworthy
that some of these countries, though harboring adversarial relations, have decided to cooperate closely—as is the case with China and India, and Japan and South Korea
Many other anti-piracy initiatives have also been taken by countries in an efort to curb
this menace he Djibouti Code of Conduct is one such efort in which nine littoral countries11 have agreed to establish Piracy Information Exchange Centres in Kenya, Tanzania,
and Yemen, along with a regional training center in Djibouti his document is now open
for signature by 21 countries in the region
he establishment of a 560 nm long sanitized corridor in the Gulf of Aden, known as the
Maritime Security Patrol Area (MSPA), now called the International Recommended Transit
Corridor (IRTC), is another such initiative with military characteristics his corridor was
established on August 22, 2008, by the US Navy Central Command (CENTCOM) with an
aim to provide safe passage to all merchant ships sailing through it Despite the eforts, and the
corridor being extensively patrolled by the coalition forces of NATO and the EU,12 there have
been some piracy attacks within this sanitized area, leading to considerable embarrassment
Apart from the above initiatives, alternative eforts such as re-routing of ships to bypass
the Horn of Africa are not economically viable solutions in the longer run Employment
of armed Sea Marshalls from private security companies for particularly dangerous parts
of the voyage is now normally being resorted to by shipping companies However, the eficacy of such a move is a matter of intense deliberation in the shipping world currently
Without going into the detailed pros and cons of the debate—it is suicient to state that the
disadvantages far outweigh the advantages and such action can cause collateral damage
It is estimated that re-routing 33 percent of cargo via the Cape would cost ship-owners an
additional $75 billion per annum hese costs will ultimately be passed on to shippers and
consumers Ships that continue to traverse the Gulf of Aden and the Suez have to purchase
insurance coverage at $20,000 per ship per voyage (excluding injury, liability, and ransom
coverage), as compared with the $500 required a few years ago
Maritime Terrorism
he global war against terrorism had taken on a new perspective in the post-9/11 era, while
its maritime dimension and its emerging format has been highlighted during the Mumbai
terrorist attacks of 26/11 Earlier, only two or three percent of all terrorist attacks were
linked directly to the seas Hence maritime terrorism was neglected by governments and
security agencies However, the Mumbai terror attacks ushered in a paradigm change, revealing the use of the seas as part of the supply chain dynamics for incidents ashore, thus
bringing to the fore the evolved format of maritime terror
he other aspect of the ight against maritime terror continues in the US initiative of searching for Al Qaeda terrorists at sea with the international coalition (Task Force 150) on the
lookout for terror ships termed as the “phantom leet”
he deep linkage of maritime terrorism and “container security” were only realized ater
it was reported in January 2002 that the search of a freighter by US naval forces nearly
yielded a group of Al Qaeda terrorists who had been hiding inside a well-equipped shipping
STIMSON CENTER | 23
The Indo-Pacific Region and the Rise of Transnational Maritime Threats and Challenges
container A dramatic increase in container cargo and inadequate infrastructure to check
all sealed containers led to the Container Security Initiative (CSI) and making ports
International Ship and Port Facility Security Code (ISPS) compliant, but a robust foolproof method against such security lapses has yet to be achieved
Closely associated with the problem of maritime terror is that of the phantom leets lying
Flags of Convenience (FOC), making them diicult to track as they routinely change names
and registry FOCs, common in the shipping world despite some procedural changes, still
pose a major challenge to maritime security It is estimated that there are about 30 such
registries (some in private hands), mainly run by small islands or impoverished nations
which have loose standards for the registration of ships While considerable work has gone
into getting these registries to become more security-oriented and rigorous as a lag state,
much still needs to be done
In the years to come, maritime terrorism is likely to manifest and evolve in many unique
ways he use of the seas as a supply chain link for terror attacks on land-based targets is
likely to be a chosen methodology of terror outits While the seas ensure the easy passage
of men and material for the attack, the land provides them with the publicity and number of
victims unavailable at sea Hence the constabulary functions of maritime agencies are likely
to see an enhancement with the growing demand for a fool-proof coastal security system
The Rise of Narco-Terrorism/Terror-Crime Nexus
Drug traicking shares a close linkage to maritime terrorism since it is oten used to inance
terrorism, insurgencies, and piracy activities directly or indirectly With proit margins
running into hundreds of percent, it is by far the most lucrative way of generating such
illegal fundshis is likely what led the Secretary Fathimath Dhiyana Saeed of the South
Asian Association for Regional Cooperation (SAARC) to state in her inaugural address
during the meeting of Interior/Home Secretaries at Timphu that, “Ample evidence suggests
the potential links between piracy and terrorism, drugs traicking, human smuggling and
related crime” She added that since this threat was transnational in nature, regional cooperation was the best possible method to respond to the issue13
Terrorist groups share a deeply symbiotic relation with drug cartels and organized
crime syndicates Not only do drug cartels provide the much needed finance, they also
provide the logistical infrastructure to move resources according to the requirements
of the terror organization
India lies in the pivot of the Golden triangle and the Golden crescent—the two infamous drug
producing areas—and is used as a transit point seawards for both his has led to a focused approach in countering narcotics supply chains by increasing cooperation between the afected
governments In this context, it is foreseen that submersibles deployed for transportation of
drugs by cartels in South America may well make an appearance in the seas of South Asia It
must be remembered that the former Sea Tigers of LTTE, which possessed extensive maritime
capability, had almost developed such a vessel in this region A half inished LTTE submersible had been discovered in Phuket in hailand Unfortunately, the South Asian navies and
Coast Guards are still unprepared to counter the arrival of such submersibles, and their arrival
would prove to be a serious setback for anti-narcotics measures in the region
24 | SEA CHANGE
P.K. Ghosh
Further Maritime Challenges
Maritime Pollution and Environmental Disasters
Pollution and oil-related environmental disasters at sea are a serious concern for environmentalists and security specialists equally While they can create havoc with the marine
ecology, they also have the ability to afect the free low of trade and shipping, and hence
are a concern for all seafarers Ports and regions afected by such disasters oten have to be
bypassed by ships, leading to losses by shipping companies
Most littoral governments are deeply concerned by the possibility of major oil spills or
wrecks of oil tankers at narrow approaches to harbors, and choke points afecting the low
of shipping traic heoretically the traic can be directed to other similar ports or routes
but practical diiculties of jetties, storage capacity, and longer routing led to a compounding
of economic losses In the IOR and the entire Indo-Paciic region there are few agencies that
possess the capacity and infrastructure for tackling environmental disasters he US Coast
Guard is probably the best equipped in this region with the Indian Coast Guard coming
second Hence it would be in the interest of all if these agencies cooperate closely (along
with the Chinese agency) on matters regarding environmental disasters
The South China Sea Imbroglio
he South China Sea (SCS) region has emerged as a global lashpoint and as a major maritime
challenge, not only for the littorals and the contending states, but for all the users and the
stakeholders as well In this volatile region, many claimant states have started resorting to aggressive posturing to reinforce their sovereignty over disparate islands and “rocks” he simmering disputes and the resort to brinkmanship pose a serious threat to peace and stability in
the region Unfortunately, the current disenchantment with multilateral fora like ASEAN to
ind an amicable solution seems to be on the rise, making it imperative for external stakeholders and users to try and ind peaceful solutions or enhance conidence amongst the parties
he geostrategic signiicance of the South China Sea is diicult to overstate he SCS functions as the throat of the Western Paciic and Indian Ocean Host to important SLOCs,
it carries nearly $12 trillion in US trade annually and also represents energy life lines to
the energy deicient states in North East Asia and China Half of Indian trade through the
area passes through the region that provides a transit between the Indian Ocean and the
Western Paciic, ensuring the rapid shipment of goods and deployments of armed forces
from one ocean to the other
Endowed with immense living and non-living resources, the region holds signiicant
amounts of energy It has proven oil reserves to the tune of 12 km3 (77 billion barrels),
with an approximate total of 45 km3 (24 billion barrels) Its natural gas reserves of 7,500
km3 (266 trillion cubic feet) make it a virtual fountainhead of hydrocarbon energy Against
this backdrop, the US, India, and others can play a stabilizing and an encouraging role by
being active participants in some of the conidence building measures among the littoral
states Ater all, the universal aim of all the maritime parties revolves around maintaining
peace and stability while ensuring the freedom of navigation and unhindered access to the
movement of shipping trade across the region
STIMSON CENTER | 25
The Indo-Pacific Region and the Rise of Transnational Maritime Threats and Challenges
Efforts to Collaborate
It is obvious that the above stated maritime threats and challenges afecting the region as
a whole can only be overcome partially or fully through expanded cooperation Maritime
cooperation, however, cannot be uniformly achieved between all the countries at the same
level Even so, India and the US share a closer maritime bonding, and it may be useful to
focus on some congruities and incongruities in their relations
India and USN
India is increasingly seen as crucial to the core US foreign policy interests in the Indo-Paciic
region As a nascent Great Power and an “indispensable partner,” in the words of Secretary
of State Kerry,14 India has emerged as an important facet of the US “pivot” or rebuilding
strategy in Asia Since 2004, Washington and New Delhi have been pursuing a “strategic
partnership” that is based on convergent geopolitical interests In this context, the then US
Defense Secretary Donald Rumsfeld and his Indian counterpart Pranab Mukherjee signed
a “New Framework for India-US Defense” in 2005 for increasing cooperative approaches in
military relations, defense industry, and technology sharing, along with the establishment
of a “framework on maritime security cooperation”15 However, it was only ater a few crests
and troughs that in June 2010 the two countries formally re-engaged through the US-India
Strategic Dialogue initiated under President Bush Since then, the growing level of cooperation has led US Undersecretary of State William Joseph Burns to say, “Never has there
been a moment when India and America mattered more to each other”16
While cooperative approaches in other ields have had their own ups and downs, the ield
with maximum potential for active cooperation has been in the maritime dimension here
has been a debate, to be sure, that the relationship at times has “evened of to a plateau,” with
Indians feeling that the US was not doing enough to sustain India’s growth while the US
felt that India was too slow in taking politico-bureaucratic decisions Notwithstanding this
debate, it is apparent that newer areas of cooperation in the maritime dimension ought to
be highlighted to enhance this growing cooperation In this context, the below-mentioned
areas have the potential for strengthening cooperation between appropriate maritime agencies of the two countries:
• Operational Cooperation: his needs to be enhanced Liaison oicers from naval
commands in India and theater commands in US Paciic Command (PACOM) can
provide important linkages for operational cooperation
• HA/DR–US India Disaster Response Initiative (2005): he disaster response initiative taken during the Tsunami of 2004-05 and repatriation of the Indian diaspora
from Lebanon in 2006 are examples wherein cooperation through structured exercises can be enhanced
• Personnel Exchanges and Training: Training and personnel exchanges are the essence
of any cooperative eforts Under the International Military Exchanges and Training
(IMET) and the Personnel Exchanges Program, such exchanges have been taking
place However, this exchange needs to be enhanced at both the sailor level and oicer
level in the two countries’ staf colleges, war colleges, etc
26 | SEA CHANGE
P.K. Ghosh
• Combined Exercises: Both the Indian Navy and the US Navy have been carrying out
extensive exercises bilaterally and multilaterally (Malabar, Quadrilateral Security
Dialogue17) with increasing complexity Such exercises enhance the level of conidence
and interoperability, which is essential he idea of having an expanded Malabar
Exercise has been kept on hold by the Indian side as it has been viewed with apprehension by the Chinese, who regard it as an axis against Chinese interests18 he need
to exercise with US allies, however, is a requirement that needs to be taken up to
enhance interoperability with both the US and its allies operating in tandem India is
also a participant in Shared Awareness and Deconliction (SHADE) as an important
instrument of communication and information exchange against piracy in the Gulf
• Invitation to Multi-Lateral Exercises: While India has been invited to the Rim of the
Paciic Exercise (RIMPAC), it is necessary that the US Navy should be reciprocally
invited to the MILAN exercises, which are held biennially near the Andaman Sea
• Amphibious Operations/Training
• Counter terrorism (CT): he 2010 Counter-terrorism Cooperation Initiative and
Combating Terrorism Fellowship Programme (CTFP)
• MDA—Maritime Domain Awareness: he US Coast Guard has made considerable
progress in matters related to MDA, while India has made unique progress in the aftermath of the Mumbai attacks of 2008 he sharing of experiences and technology
will be a welcome step in enhancing cooperation
• Monitoring of SLOCs
• Equipment Purchase and Technology Transfer: India has purchased maritime equipment from the US, including the amphibious landing platform/dock (LPD) and eight
P-8I anti-submarine warfare aircrat19
• Protecting the Global Commons
Conclusion
Maritime challenges and threats in the Indo-Paciic region have increased in recent years
and have the potential to create serious impediments to the exercise of freedom of the seas,
thus afecting sea-borne trade in the region Additionally, these threats have also spawned
a multitude of “out of area operations” which have entailed additional roles for the littoral
navies Countering these threats and challenges requires cooperation and sensitivity to the
security concerns of other countries—an aspect that is diicult to achieve with the level of
existing trust between states India and the US, also an Indo-Paciic power, are the primary
maritime nations that have a responsibility to help other littoral states towards capacity
building and ultimately towards maintenance of “maritime order” in the region
In this context, it is necessary that a matrix of cooperation be evolved which would enhance
“maritime bonding” at various levels between the maritime agencies and the navies Such
measures and methods would not only help in overcoming the challenges and threats in the
oceanic dimension, but ensure the freedom of navigation for global trade lows Ater all,
the Sea is unique in bringing together maritime-minded countries, which in turn enlarges
the brotherhood of the seas
STIMSON CENTER | 27
The Indo-Pacific Region and the Rise of Transnational Maritime Threats and Challenges
About the Author
PK Ghosh is presently a Senior Fellow at the Observer Research Foundation (ORF) in New
Delhi He was the Co-Chair and India Representative to two consecutive CSCAP International
Study Groups on Maritime Security (CSCAP—Council for Security Cooperation in Asia
Paciic Region is the Track II version of the ASEAN Regional Forum—ARF) Dr Ghosh
retired from the Indian Navy ater 28 years of commissioned service A graduate of the
National Defence Academy, he has done post-graduate work in Telecommunications and
wrote his doctoral thesis on International Relations Prior to joining the ORF as a Senior
Fellow, he served as a Research Fellow at the Institute for Defence Studies and Analyses
(IDSA) for two tenures (2000- 2004), ater which he was awarded the prestigious Prof DS
Kothari DRDO Chair (2004-05) at the USI (United Services Institution) He is the Founder
Member of the National Maritime Foundation (NMF) and was its Senior Fellow from inception until December 2008 He was the Senior Fellow at the Centre for Air Power Studies
(CAPS) from January 2009 to January 2010 A SEAS Fellow (2010) and an Alumni of APCSS
Hawaii, he was the coordinator of the major Indian maritime initiative IONS (Indian Ocean
Naval Symposium) that he helped in conceptualizing from scratch He has lectured extensively around the globe and written on issues connected with maritime security, asymmetric threats, capacity building, Chinese maritime capability, and Ballistic Missile Defense
Notes
1 his is an updated and modiied version of the article PK Ghosh, “Trans national Maritime hreats
and Challenges,” in Maritime Security in the Indo-Paciic, Mohan Malik ed, (Lanham, MD: Rowman &
Littleield, 2014) See PK Ghosh, “Indian Ocean Dynamics: An Indian Perspective,” East Asia Forum, 5
April 2011
2 See PK Ghosh, “Trans national Maritime hreats and Challenges,” in Maritime Security in the IndoPaciic, Mohan Malik ed, (Lanham, MD: Rowman & Littleield, 2014), p156
3 World Ocean View “A look at the future,” at http://worldoceanreviewcom/en/wor-1/transport
4 See United Nations Conference on Trade and Development, Review of Maritime Transport 2011 (Geneva:
UNCTAD, 2011), pxv at http://unctadorg/en/docs/rmt2011_enpdf
5 See UNCTAD, Review of Maritime Transport 2012 (Geneva: UNCTAD, 2012), pxiv at http://unctadorg/
en/PublicationsLibrary/rmt2012_enpdf
6 At current levels of consumption, the oil import dependence of India is expected to rise to 916% by 2020,
while in the case of China it will be 769%
7 he African Union, Arab League, EU, IMO, NATO and the UN Secretariat are members he contact
group has a rotating Chairmanship and has four working groups:
•
Military and Operational Coordination, information sharing and capacity building—Chaired by UK
•
Judicial issues—Chaired by Denmark
•
Strengthening shipping self awareness and other capacities—Chaired by USA
•
Public Information—Chaired by Egypt
8 PK Ghosh, “Somalian Piracy: and Alternate Perspective,” ORF Occasional Paper #16, (September
2010) at http://orfonlineorg/cms/sites/orfonline/modules/occasionalpaper/attachments/occasional_1286780029911pdf
9 he Piracy Bill 2012, which was a comprehensive document to deal with modern piracy, remains unpassed by the Indian Legislature
28 | SEA CHANGE
P.K. Ghosh
10 Starting in March of 2009, NATO started rotating its Standing NATO Maritime Group 1 (SNMG 1) and
Standing NATO Maritime Group 2 (SNMG 2) warship leets of the coast of Somalia, irst with Operation
Allied Provider until August of last year and since with Operation Ocean Shield, which continues to the
present day and which in March was extended until the end of 2012 he current leet consists of warships from the US, Britain, Greece, Italy and Turkey Its area of operations includes one million square
kilometers in the Gulf of Aden and the Somali Basin (he current names of the naval groups are NATO
Response Force Maritime Groups 1 and 2) See Rick Rozof, “Japanese Military Joins US And NATO
In Horn Of Africa,” Stop NATO, 26 Apr 2010, available at http://rickrozofwordpresscom/2010/04/26/
japanese-military-joins-u-s-and-nato-in-horn-of-africa/
11 Djibouti, Ethiopia, Kenya, Somalia (TFG), Yemen, Madagascar, Maldives, Seychelles and Tanzania
12 ICC Commercial Crime Services Newsletter, 26 Aug 2008
13 As cited in “ SAARC seeks urgent steps to protect maritime trade, security,” he Hindu, 22 July 2011, at
http://wwwthehinducom/news/international/saarc-seeks-urgent-steps-to-protect-maritime-trade-security/
article2284646ece
14 Michael R Gordon and Gardner Harris, “In India, Kerry to Meet New Prime Minister and Seek
Improved Relations,” New York Times, 31 July 2014, at http://wwwnytimescom/2014/08/01/world/asia/
john-kerry-in-india-to-meet-narendra-modihtml?_r=0
15 Sridhar Kumaraswami, “India, US Defence cooperation ‘set to escalate’,” he Asian Age, 9 September 2007
16 “India, US launch strategic talks,” Global Security Newswire, 2 June 2010, at http://gsnntiorg/gsn/
nw_20100602_6708php
17 he Quadrilateral Security Dialogue is an informal military and strategic alliance between the United
States, Japan, Australia and India that is maintained by talks and by a series of formal bilateral alliances
between member countries he Chinese view it as an arrangement against their interests he Malabar
Exercises commenced in 1992 hough they were suspended in 1998 due to nuclear tests by India—prior to
which only three exercises were conducted hey began again ater 2002
18 India US, Japan, Singapore, and Australia participated in the Malabar exercises conducted in
September 2007 (also known as expanded Malabar due to the large participation) of the coast of
Okinawa Due to Chinese opposition and unhappiness it issued a “demarche” to India, the United States,
Japan, and Australia seeking details about their four-nation exercises Hence India returned to the original bilateral format of the exercise
19 USS Trenton (INS Jalashwa) was purchased from US in 2007 Recently eight Boeing P8-I long-range maritime reconnaissance aircrat (LRMRA) have been purchased under the US FMS (Foreign Military Sales)
Twelve such aircrat are likely to be purchased in addition
STIMSON CENTER | 29
The Indo-Pacific Region and the Rise of Transnational Maritime Threats and Challenges
Photo by Hamed Saber
US Maritime Security Relations
and Partnerships in the Indo-Pacific:
Opportunities for Enhanced Cooperation
Scott Cheney-Peters
Since irst announced in 2011 as “the pivot,” the US “rebalance to the Paciic” has sought
to shit military, economic, and diplomatic resources to the region and to boost their effectiveness through the development of partnerships and formal agreements hese eforts
have thus far not been universally successful, but one area in which the United States
has achieved several of its objectives is the maritime domain, both in terms of increased
naval presence and the furtherance of regional initiatives, such as signing of the Code for
Unplanned Encounters at Sea this year in Qingdao and increased participation in multilateral humanitarian assistance/disaster response (HA/DR) exercises1 his success has come
about in part because the United States is in some cases building upon hundreds of yearsold maritime relationships As a result, an in-depth study of US maritime security relations
in the Indo-Paciic could ill several books But, while this paper will not be able to delve
deeply into every partnership, it will lay out a framework for understanding and categorizing these relations and partnerships in the region and how several of the major relationships
it in this context It will also discuss some opportunities and recommendations to further
develop these and other regional maritime security relationships, focusing on opportunities
for enhanced Indian cooperation both direct and complementary
To understand US relationships in the Indo-Paciic it is necessary to irst consider the goals
of the United States in the region he rebalance to the Paciic serves to highlight the United
States’ recognition that, in the twenty-irst century, the better part of its economic vitality
hinges on uninterrupted trade lows from and through Asia and that resources should proportionally match this reality So, while the United States may have little territory at stake
in regional disputes,2 it is far from an uninterested party in the region
Recognizing this connection, the United States has as its overarching regional goal a focus
on stability—a word repeated throughout speeches from President Barack Obama to
Secretary of Defense Chuck Hagel to Secretary of State John Kerry3 his broad goal extends
to economic, environmental, and political stability because a stable region is best positioned
to protect shipping, yield prosperous trading partners, and prevent or prepare for the types
of disasters that later require much larger expenditure of resources It is important to note,
however, that support of stability does not necessarily mean support of the status quo From
forums for the advancement of human rights and democratic governance to initiatives to
combat pollution and transnational crime, the United States has several regional policy
areas where it hopes to efect change
US eforts to pursue regional stability can be divided into those that support stability through development, those that support stability through deterrence, and those that
support stability through capacity building and regional cooperation his is a bit of an artiicial division as, for example, aiding the development and professionalization of partners’
maritime enforcement agencies cuts across all three categories Nonetheless, it serves as a
STIMSON CENTER | 31
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
useful framework for broadly analyzing US eforts and their impacts on relations Of these,
it is the latter two that are the focus of the rest of this paper, for they are the main drivers
of US maritime security relations in the Indo-Paciic
To provide a full picture of US strategic architecture in the region it is necessary to start with
the United States’ own sovereign physical infrastructure, including that which is poised to
project into the area as necessary Along the eastern edge of the Paciic Rim sits, as naval
analyst Andrew Erickson calls it, the “backbone” of US power projection in Asia—US Paciic
Command While headquartered in Hawaii, its subordinate US hird Fleet naval components and facilities stretch from San Diego north to Washington State, acting as a backstop to
America’s Paciic naval forces Additionally, Alaskan ballistic missile defense (BMD) site Fort
Greely along with Vandenberg in California,4 play a supporting role in America’s deterrence of
conlict on the Korean Peninsula by allowing the United States to prevent Democratic Republic
of North Korea (DPRK) missile development from taking US security options hostage
Moving west from Hawaii, Guam plays an important role in sustaining air and submarine operations in-theater by hosting prepositioned forces and Coast Guard cutters5 and is planned to
maintain an increasing proportion of US Marines in the region6 British-leased Diego Garcia
plays a similar role as an element of strategic depth with another maritime pre-positioned
squadron in addition to long-range air, surface, and submarine support facilities Further to
the west lie the forces of US Central Command, important to counter-piracy and deterrence
missions at the west end of the Indo-Paciic, but outside the scope of this paper
Stability through Deterrence
Tracing US Indo-Paciic physical infrastructure in the region outside of its territory largely
highlights the primacy of stability-through-deterrence eforts on American security relations in Northeast Asia It is worth noting that one reason why US regional maritime security relationships in Northeast Asia are focused on deterrence may also be that the need
for some other forms of maritime regional cooperation required elsewhere are of limited
necessity in this sub-region Whether it is the strength of the rule of law or the capability of
national coast guards and maritime enforcement agencies, piracy in recent years is far less
of an issue in Northeast Asia than in regions to the south and west
South Korea
No greater example exists of the US security infrastructure’s relection of deterrence concerns in Northeast Asia than the eighty-three bases and facilities in South Korea serving as a
bulwark of deterrence against North Korean aggression7 While troop levels are down from
Cold War peaks, the focus on deterrence continues to this day he US alliance with South
Korea is also an example of the ways these relationships can transform over time, crossing
into cooperation eforts with Indian Ocean counter-piracy patrols, regional HA/DR, and
the sale and donation of maritime assets to US partners he US Congressional Research
Service remarked that “since 2009, the two sides have accelerated steps to transform the
US-ROK [Republic of Korea] alliance, broadening it from its primary purpose of defending
against a North Korean attack to a regional and even global partnership”8
Yet, for the foreseeable future, the US-South Korea relationship will remain focused on deterrence and stability tied to the Korean peninsula But here, too, there is room for further
32 | SEA CHANGE
Scott Cheney-Peters
development, especially trilaterally with Japan on issues such as maritime domain awareness and ballistic missile defense—areas of cooperation notably stymied by regional politics
and historical grievances
Japan
For its part, Japan—the United States’ second Indo-Paciic treaty ally—plays host to the
largest concentration of US military bases and facilities in the region While South Korea
hosts primarily air and ground forces, Japan is home to a far greater number of naval
assets, including the US Seventh Fleet Similarly rooted in the history of Cold War deterrence, the US relationship with Japan continues to place a strong emphasis on deterring
regional conlict as Japan’s security guarantor—whether by providing assurances against
unilateral action over the Senkakus/Diaoyus or missile defense coverage against the threat
from North Korea Under Prime Minister Abe, this emphasis has only strengthened and is
relected in the Japanese government’s eforts to secure the right of collective self-defense,
which would enable Japanese Maritime Self Defense Force (JMSDF) vessels to come to the
aid of allies in combat (under stringent conditions)
Yet over the past decade, the US-Japanese maritime security relationship has also transformed into a more robust and wide-ranging partnership to address regional security
issues in the Indo-Paciic his transformation is the result of a shared interest in a stable
and prosperous trading region designed to boost economic prospects he resultant uptick
in hostility from China as a result of the Japanese government’s nationalization of the
Senkakus in 2012 spurred “Japan’s enlistment as a full-ledged partner in the Rebalance”
to create “strategic depth”9 Japan has notably stepped up its training and provision of maritime enforcement assets throughout Asia, including relaxing military export rules, while
promising greater coordination on such eforts with the United States10 Japan also broke
the intellectual ground on the establishment of the Regional Cooperation Agreement on
Combating Piracy and Armed Robbery against Ships in Asia (ReCAAP), leading to the establishment of the Information Sharing Centre (ISC) in Singapore, and the formation of a
counter-piracy regional hub at the west end of the Indo-Paciic in Djibouti11
Taiwan
Taiwan is America’s third regional relationship centered on deterrence and is governed by
the Taiwan Relations Act and the hree Communiqués Although a purveyor of military
equipment to Taiwan and trainer of some of its air force, the US maintains no military footprint on the island and does not include Taiwan it in maritime exercises12 Further, despite
these constraints, the United States has been highly supportive of Taiwan’s engagement in
stability through regional cooperation eforts—from a 2013 isheries agreement with Japan
to using US supplied material for HA/DR eforts in the Philippines and elsewhere At the
same time, the emphasis on deterrence is receding he thawing of ties between Taiwan
and mainland China is the sort of so-far peaceful progress that the United States can, for
now, only dream of on the Korean Peninsula Yet, while the threat of a cross-strait conlict
is low in the near-term, it increases over the coming decade if current trends in the shit of
the balance of power hold steady and no peaceful means for mainland China to incorporate Taiwan present themselves—a scenario made more remote by China’s handling of the
recent protests over enfranchisement in Hong Kong13
STIMSON CENTER | 33
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
Philippines
Several US maritime security relationships have more recently added elements of deterrence, particularly in relation to territorial disputes in the South China Sea he signing
of the Enhanced Defense Cooperation Agreement (EDCA) with the Philippines in April
facilitates, among other things, the rotational presence of American forces in the country
and signals US commitment to its third regional treaty ally amid tensions with China over
ownership of the Paracels and Scarborough Shoal As with Japan’s pending donation of
patrol boats to the Philippines, the EDCA is also aimed at boosting the nation’s isheries-enforcement capabilities and HA/DR coordination,14 an indication of the extent of the
US-Filipino maritime security relationship that runs the length of the entire archipelago
south to Malaysia and the waters abutting Indonesia his partnership includes support for
the Philippines’ eforts to counter insurgencies, terrorism, arms-traicking, and insurgent
invasions of Malaysia And the partnership is growing—at the end of May, the US State
Department requested a 57% increase in funds “to improve [the Philippines’] maritime
security and maritime domain awareness”15
Vietnam
In the past several years, Vietnam has increased its ties with the United States even before
the Chinese National Oil Ofshore Corporation (CNOOC) moved a rig to disputed waters
of its coast in May of this year he two nations began joint low-level military training
and exercises in 2010,16 and the United States has promised Vietnam additional maritime
capacity building funds for among other things ive fast patrol vessels as announced last
December by Secretary Kerry17 Vietnam, in turn, announced in May that it was joining the
US-launched Proliferation Security Initiative (PSI) aimed at interdicting weapons of mass
destruction material18 Vietnam is also set to become the third recipient of Japanese patrol
boats ater Indonesia and the Philippines19 Although the US-Vietnamese relationship is
nominally focused on regional cooperation eforts such as these, the lare-up with China
over the CNOOC oil rig this summer makes plain the dual nature of the growing partnership In October, the United States partially lited its decades-old ban on the sale of military material to Vietnam, speciically enabling the purchase (as-yet unmade) of maritime
surveillance kit such as patrol boats and maritime patrol aircrat20 Yet the likelihood that
the United States would, as part of its deterrent eforts, signal a willingness to directly and
militarily get involved in Vietnam’s disputes is far less than with its treaty allies
Malaysia
Malaysia, too, has in recent years increased the unoicial deterrence elements of its partnership with the United States, expanding its naval facilities to support a growth in American
port visits and improving its maritime domain awareness capabilities with American assistance, while increasing capacity building and regional cooperation ties21 President Obama’s
trip to the nation in April produced a joint statement airming support for mil-to-mil cooperation, development of an Association of South East Asian Nations (ASEAN) code of
conduct with China, and international legal proceedings for settling maritime disputes he
visit also reportedly discussed expanding upon the strategic partnership signed between
Malaysia and Vietnam this year that called for joint patrols between the two nations22
34 | SEA CHANGE
Scott Cheney-Peters
Stability through Capacity Building and Regional Cooperation
America knows that its partners view its deterrence eforts as important to preserving stability in the eastern half of the Indo-Paciic and are likely to do so for some time to come At
the same time, building local capacity and boosting regional maritime cooperation are just
as important for the over-arching US goal of stability in the region to protect its economic
vitality23 It is arguable that that these tasks may be even more critical since the challenges
they deal with already exist—piracy and armed robbery, illegal resource exploitation, traficking, natural disaster, and climate change
In fact, many US partnerships in the region are largely or even exclusively focused on capacity building and regional cooperation his does not mean that the United States wants,
or is able to, participate in every exercise or joint patrol To the contrary, the development
of efective regional action not requiring US resources is a very desirable outcome for US
policy makers With a broad array of eforts encompassing everything from the PSI to the
Gulf of hailand Initiative to a full schedule of exercises, it is easy to see that these stability-building partnerships involve nearly every maritime nation in the region Players range
from China and India to several who struggle to ield rudimentary coast guards, not as
proxies of the United States, but out of self-interest his paper will only briely touch on
some of the more developed relationships—namely Singapore, Australia, New Zealand,
France, and the United Kingdom
Singapore
Singapore, at the tip of the Malay Peninsula, has the epitome of a capacity building and
regional cooperation partnership with the United States It provides not only Sembawang’s
port facilities and hosts the rotational deployment of littoral combat ships, themselves the
American naval embodiment of this type of partnership, but also ReCAAP’s ISC and the
multinational exercises and operations center Singapore also participates in coordinated
counter-piracy patrols in and above the Straits with Malaysia, Indonesia, and hailand—
America’s fourth treaty ally—in the Malacca Straits Patrol24
Australia and New Zealand
Australia, another formal treaty ally, has likewise recently concluded an agreement to host
rotational American forces and plays an important role as a respected regional voice on
the resolution of maritime security issues25 It also has a wealth of experience in maritime
security operations in its near abroad Along with New Zealand, the sixth formal US ally
in the region,26 Australia is an active provider of professional development training and
has been a pioneer in technical assistance to Paciic Island states with its Paciic Patrol
Boat Program and planned follow-on27 Australia and New Zealand, along with the United
States and France, also pledged a coordinated approach in 2012 to boost the surveillance
capacity of Paciic Island states combatting illegal, unreported, and unregulated (IUU)
ishing28 Additionally, Australia and New Zealand, as members of the Five Power Defense
Agreement with Singapore, Malaysia, and the United Kingdom, have the opportunity to
augment US maritime priorities by helping develop the capacity of other regional FPDA
members For example, in November, Australia promised a pair of patrol boats to the
Malaysian Maritime Enforcement Agency for use in the Malacca Strait by March29
STIMSON CENTER | 35
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
France and the United Kingdom
For their part, France and Britain are mostly extra-territorial powers in nature in the IndoPaciic, with island territories such as New Caledonia, French Polynesia, and Diego Garcia
far from the nations’ homelands But, as with Australia and New Zealand, these partners
bring expertise, trainers, and capability—even if in limited numbers France, in particular,
has a history of developing the maritime enforcement capabilities of South Paciic island
states, as noted above, and works with the United States in doing so he United States
regularly exercises and cooperates with these nations’ maritime contingents throughout
the Indo-Paciic, as well as takes advantage of their logistics, primarily as part of eforts to
either boost interoperability or develop third-party capabilities
Recommendations and Options
he above list only scratches the surface of US partnerships in this second category, but its
breadth does not bar the opportunity for their deepening Evolving geopolitics creates opportunities for strengthening ties with two key partners—Indonesia and India—and several
additional options for both the United States and India to consider
Indonesia
When newly elected Indonesian President Joko Widodo (Jokowi) gave his inaugural address
in October, he focused on the development of Indonesia as a maritime nation,30 backing up
his words with the creation of a new cabinet post to coordinate protection of Indonesia’s
marine resources and maritime zones31 and announcing the consolidation of maritime
enforcement agencies into a unitary coast guard32 It should come as no surprise that an
Indonesian leader would place maritime issues at a forefront of his nation’s policy agenda
Indonesia is one of the states most challenged by maritime crime, with an increasing majority of all such crime occurring in the South China Sea region33 here is an opening for
regional leaders, such as the United States, India, and China, to pursue a more robust relationship anchored on capacity building to combat common maritime security challenges
Already, the US president and secretary of the navy have expressed a desire to pursue closer
ties over maritime issues, including piracy, disaster mitigation, naval exchanges, and counter-terrorism; but doing so with other partners would amplify the efects and could extend
across a broader range of eforts34
Indonesia should also be encouraged to continue to develop a role as a leader in the
region, as it has done with the establishment of multilateral HA/DR exercise Komodo,
by joining additional regional maritime security architectures such as ReCAAP Support
should also be lent for Indonesian eforts to provide a united voice in dealing with China
over the elusive code of conduct in the South China Sea—a policy Jokowi has continued
in the initial days of his administration35 Indonesia is able to retain its role as neutral
mediator in part due to the unacknowledged nature of its disagreement with China over
the Natuna islands,36 but in order to maintain this ambiguity Indonesia should be assured
that any unilateral action on China’s part will be efectively countered Lastly, maritime
boundary disputes with neighbors Singapore and Malaysia occasionally keep relations
cool, and while they are the source of on-going technical talks, their resolution could
receive a greater prioritization in diplomatic discussions
36 | SEA CHANGE
Scott Cheney-Peters
India
India has been a strong partner of the United States on a range of maritime security issues,
conducting more annual military exercises with the United States than any other country37
Bilateral counter-piracy operations in the Western Indian Ocean have aimed to work on
maritime domain awareness (MDA) interoperability in annual exercises including Malabar,
to which Japan was this year invited to participate for the irst time since 200938 But there
is room for greater cooperation and coordination on issues of shared interest, such as HA/
DR exercises and maritime law enforcement One option is to encourage India to involve
assets at the Andaman and Nicobar Command (ANC) with the Malacca Strait Patrol ANC
is already hub for India’s maritime engagement and cooperation operations throughout the
Bay of Bengal and Southeast Asia, and could serve to anchor the western approaches to the
Malacca Strait with a cooperative naval and civil maritime enforcement hub in a relection
of Singapore at the eastern end39
he United States and India should explore ways to increase their coordination on maritime
security training, aid, and assistance programs—aiming for projects that amplify one another’s eforts he United States could partner with India through its leadership role in the
so-called Indian Ocean-5 grouping to bolster the spread of efective MDA and information
sharing, including formal or regular exercising of linkages to other regional exchanges such
as the ISC and that supporting the Malacca Straits Patrol40 Additional trilateral exercises
in the mold of Malabar will continue to serve to strengthen with third-party partners like
Australia, while complimentary capacity building as suggested in the case of Indonesia
could strengthen alignments of mutual maritime interest while mitigating potential political hesitancy with countries like Bangladesh and Malaysia
China
Other options for increasing stability involve more complicated partnerships; for example,
the US relationship with China could be described as “deterrent engagement” On one
hand the United States will seek to engage China as far as reasonably possible on cooperative eforts including such ongoing examples as East African counter-piracy, the ASEAN
Defense Ministers Meeting (ADMM)+ HA/DR exercise, and for the irst time last summer
the large-scale US-led multilateral exercise Rim of the Paciic (RIMPAC) Options for
potential increased maritime cooperation include Paciic Partnership and cooperative capacity building programs On the other hand, the US will—and should—seek through its
partnerships enough credible capability to act as a deterrent against the potential for destabilizing actions One option for the United States or others who want to play a more active
role in stability-through-deterrence eforts is to increase the number of exercises and joint
patrols with Vietnamese maritime units in disputed Vietnamese-claimed areas, but away
from current hot spots41 he political will for such action is debatable but it is a strengthening in partnership that Vietnam has reportedly pursued, and in which the United States
may be interested42
Iran and Russia
Russia and Iran are also likely to be active players in the Indo-Paciic, with the resurgence of Russian naval power demonstrated by the protest patrol ahead of this year’s G20
summit in Brisbane,43 and the Iranian exempliied by its pursuit of a limited blue water
STIMSON CENTER | 37
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
Navy and greater maritime ties with Indo-Paciic nations including Indonesia and China44
he United States will need to determine to what extent it can reasonably pursue a policy of
cooperation based on shared interests to promote regional stability, as it has done with the
pair in the western Indian Ocean with counter-piracy patrols India, with warmer ties to
both countries, may also be able to ind ways to work cooperatively in the maritime domain
for the good of the region that the United States inds diicult
Non-State Actors
One of the more intriguing partnership options for the United States to pursue is increased
partnerships with non-state actors, whether they are non-governmental organizations
(NGOs), inter-governmental organizations (IGOs), or private maritime security companies
(PMSCs) he United States has already demonstrated the success of this approach when
interests compatibly align, as with aid organizations during its annual Paciic Partnership
and other HA/DR eforts his year’s Southeast Asia Cooperation and Training (SEACAT)
exercise, which pairs the United States and ASEAN member nations, expanded the number
of civilian maritime law enforcement agencies involved and stressed cooperation both internationally and domestically—an approach that should be repeated and involve as many
agencies and elements of civil society as practical45
As for PMSCs, Professor James Holmes notes in he Diplomat that the United Kingdom
“explicitly endorses conscripting private security irms as an ally in the ight for oceanic
law and order” in its new Maritime Security Strategy46 In addition to directly partnering
with these groups, the United States may encourage states lacking maritime capacity to do
so themselves In a creative example, a state lacking efective maritime isheries enforcement could partner with a conservation organization, who in turn hires a PMSC to provide
training or conduct enforcement services themselves Such an approach carries a real risk
that a lack of accountability or professionalism could lead to bad outcomes However, with
rigorous oversight and safeguards, paired with the last decade of maturing industry accreditation schemes, codes of conduct, and improving standards, such risk can be mitigated to
make this approach a viable option
HA/DR Infrastructure
A inal option for enhanced American partnerships in the region focuses on developing
and coordinating HA/DR architecture Singapore has this year again advocated an HA/DR
Center at Changi alongside its other fusion centers47 his would be well placed to serve as
a coordination hub for regional eforts Canada, meanwhile, has developed a model based
on Operational Support Hubs consisting of a small, dormant facility that can be expanded in times of crisis and has host nation permissions in place to minimize bureaucratic
impediments to a speedy response48 In one scenario, similar hubs could be developed
under the aegis of a multinational IGO such as the ASEAN Defense Ministers MeetingPlus (ADMM+) with external support and established in several locations throughout the
region Another approach could see locally sponsored, but interoperable, locations created
as part of a network open to partners Either approach would require resources and raise
issues including status of forces agreements (SOFAs), sovereignty sensitivities, and demarcation of the permissible range of operations for the hub But in a region prone to natural
disasters and vulnerable to the next century of climate change, such architecture could
play an important part in preserving stability and driving US or Indian maritime security
38 | SEA CHANGE
Scott Cheney-Peters
relations Working through the issues in advance is better than waiting for disaster to strike,
whether by exercises or pre-approval of a range of actions For India, the HA/DR infrastructure investment and its strategic location makes ANC a logical choice were it to ofer
or plug in a node to a network49
Conclusion
his paper has attempted to provide a general sketch of and framework for understanding US maritime security relations in the Indo-Paciic in the context of the overarching
American goal of ensuring a stable and prosperous region By categorizing US relations
in the region, this paper runs the risk of oversimplifying multi-faceted maritime relationships hese categories are meant only to highlight an important, if not dominant, element
of each of these relationships But regardless of whether a relationship is more heavily
weighted towards deterrence or towards capacity building and regional cooperation, the
importance of sustained engagement, even through basic exercises, for tailoring expectations and supporting the ability to work together on shared interests, is critical hese
partnerships take time and efort, but the returns they yield—safe sea lanes and a stable
and prosperous region—are very much in the interest of the United States and the nations
of the Indo-Paciic
About the Author
Lt Scott Cheney-Peters is the founder and chairman of the Center for International
Maritime Security (CIMSEC), a non-partisan think tank based in Maryland, and a surface
warfare oicer in the US Navy Reserve He formerly served as editor of Surface Warfare
magazine Prior active duty tours include forward deployment in Japan Scott is a graduate
of Georgetown University and the US Naval War College, and a member of the Truman
National Security Project’s Defense Council Scott’s research focuses on Asian maritime
security issues and naval applications of emerging technology
STIMSON CENTER | 39
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
Notes
1 “Document: Conduct for Unplanned Encounters at Sea,” USNI News, 17 June 2014, at http://newsusni
org/2014/06/17/document-conduct-unplanned-encounters-sea
2 his is not to say that the United States lacks sovereign territory in the Indo-Paciic, as possessions
include Hawaii, Guam, and the Commonwealth of the Northern Marianas Islands Additionally, it administers the military afairs of three sovereign entities through 20-year renewable Compacts of Free Association
with the Republic of Palau, Federated States of Micronesia, and Republic of he Marshall Islands
3 See for example the numerous public statements from Department of Defense and the Department of State
4 “Elements: Ground-Based Missile Defense,” US Missile Defense Agency, as of 11 June 2014, at http://www
mdamil/system/gmdhtml
5 Ens Freddy Hofscneider, “US Coast Guard Completes Western Paciic Maritime Patrol,” Marianas Variety,
12 May 2014, at http://pidpeastwestcenterorg/pireport/2014/May/05-12-08htm he Coast Guard forces are
assigned to USCG Fourteenth District, Sector Guam, while the prepositioned forces are attached to Military
Sealit Command (MSC) Military Prepositioned Squadron (MPSRON) 3—also operating out of Saipan—
whose 11 ships carry prepositioned US military cargo for the US Army, US Air Force, and US Marines
6 Richard Sisk, “Navy Hails Gains in Plan to Move Marines to Guam,” Military.com, 18 April 2014, at
http://wwwmilitarycom/daily-news/2014/04/18/navy-hails-gains-in-plan-to-move-marines-to-guamhtml
7 US Department of Defense, Base Structure Report: Fiscal Year 2013 Baseline (Washington, DC: Oice
of the Secretary of Defense, September 2012), at http://wwwacqosdmil/ie/download/bsr/Base%20
Structure%20Report%202013_Baseline%2030%20Sept%202012%20Submissionpdf
8 Mark E Manyin et al, US-South Korea Relations, Congressional Research Service, 24 June 2014, at
https://wwwfasorg/sgp/crs/row/R41481pdf
9 Scott Cheney-Peters, “How Japan’s Nationalization Move in the East China Sea Shaped the US Rebalance,”
he National Interest, 26 October 2014, at http://nationalinterestorg/feature/how-japans-nationalizationmove-the-east-china-sea-shaped-11549?page=2
10 Scott Cheney-Peters, “Vietnam Set to Receive Japanese Patrol Boats Next Year,” CIMSEC’s Nextwar Blog,
2 June 2014, at http://cimsecorg/vietnam-receive-japanese-patrol-boats/; Scott Cheney-Peters, “US, Japan
to Boost ASEAN Maritime Security,” he Diplomat, 30 April 2014, at http://thediplomatcom/2014/04/
us-japan-to-boost-asean-maritime-security/
11 Miha Hriebernik, “ReCAAPing Japan’s Counter-Piracy Multilateralism,” CIMSEC’s Nextwar Blog, 9 July
2013, at http://cimsecorg/recaaping-japans-counter-piracy-multilateralism/
12 Daniel R Russel, “Evaluating US Policy on Taiwan on the 35th Anniversary of the Taiwan Relations Act,”
US Department of State testimony, 3 April 2014, at http://wwwstategov/p/eap/rls/rm/2014/04/224350htm
13 Scott Cheney-Peters, “Navigating the Black Ditch: Risks in the Taiwan Strait,” Strategic Insights 52
(September 2014), pp2-6, at http://wwwstrategicinsightseu/dyn/iles/news_news/55-ile2/Strategic%20
Insights%20No53%20Article%201pdf
14 Jane Morse, “Philippines, US Agree to Enhanced Security Cooperation,” US Department of State, IIP
Digital translation, 28 April 2014, at iipdigitalusembassygov/st/english/article/2014/04/20140428298394html
15 Camille Diola, “$40B for Philippine Maritime Capability a ‘US Priority,’” he Philippines Star, 30 May 2014,
at http://wwwphilstarcom/headlines/2014/05/30/1329090/40m-philippine-maritime-capability-us-priority
16 CTF73 Public Afairs, “US, Vietnam Navies Conduct First Search and Rescue Exercise,” Navy.mil, 14
April 2014, at http://wwwnavymil/submit/displayasp?story_id=80335
17 “Expanded US Assistance for Maritime Capacity Building,” US Department of State, Fact Sheet, Oice
of the Spokesperson, 16 December 2013, at http://wwwstategov/r/pa/prs/ps/2013/218735htm
18 “Vietnam Supports the Proliferation Security Initiative,” US Department of State, Media Note, Oice
of the Spokesperson, 22 May 2014, at http://wwwstategov/r/pa/prs/ps/2014/05/226449htm
19 Scott Cheney-Peters, “Japan to Provide Vietnam Patrol Boats Next Year,” USNI News, 2 June 2014,
40 | SEA CHANGE
Scott Cheney-Peters
at http://newsusniorg/2014/06/02/japan-provide-vietnam-patrol-boats-next-year
20 Murray Hiebert, “US Links Arms with Vietnam in Maritime Security Fight,” East Asia Forum, 12 November
2014, at http://wwweastasiaforumorg/2014/11/12/us-links-arms-with-vietnam-in-maritime-security-ight/
21 Robert D Kaplan, Asia’s Cauldron (New York: Random House, 2014), p88
22 “Malaysia—US to Focus on Maritime Security and South China Sea,” NSNBC International, 27 April
2014, at http://nsnbcme/2014/04/27/malaysia-us-to-focus-on-maritime-security-and-south-china-sea/
23 Building Partnership Capacity typically consists of inancial aid, the transfer of assets, and Navy and
Coast Guard training Regional Cooperation includes bilateral and multilateral exercises, information
sharing, the support of joint patrols, and cooperative security mechanisms
24 “Fact Sheet: Milestones of Malacca Strait Patrols,” Singapore Ministry of Defense, as of 13 November 2014,
at http://wwwmindefgovsg/imindef/press_room/oicial_releases/nr/2008/mar/28mar08_nr/28mar08_fshtml
25 Hayley Channer, “Hub and Spokes: How US Allies in Asia Can Contribute to the US Rebalance,” Asia
Paciic Bulletin 265, East-West Center, 3 June 2014, at http://wwweastwestcenterorg/sites/default/iles/
private/apb265_0pdf
26 Although the suspension of US ANZUS treaty obligations to New Zealand by the Reagan administration
has, to my knowledge, never been formally revoked, with the 2010 Wellington Declaration and all public pronouncements subsequent it is my opinion that ANZUS is back in full efect—occasional public listings of the
ive, rather than six, regional treaty allies notwithstanding, and the treaty remains on the US State Department
website: http://wwwstategov/s/l/treaty/collectivedefense/ It is hard to imagine a scenario in which New
Zealand’s security would be under threat and the United States not come to its defense Additionally, New
Zealand was formally designation a “Major Non-NATO Ally” by President Bill Clinton in 1997 and as such
retains the title “Ally” under Title 10 of the US Code regardless of ANZUS implementation
27 Shahryar Pasandideh, “Australia Launches New Paciic Patrol Boat Program,” he Diplomat, 1 July 2014,
at http://thediplomatcom/2014/07/australia-launches-new-paciic-patrol-boat-program/
28 On the Niue Treaty, see “Cook Islands, Palau Lead Momentum for Regional Fisheries Surveillance,”
Pina, 23 April 2014, at http://wwwpinacomj/?p=pacnews&m=read&o=15786987615356e8d0a65804af2
5e6; “he Paciic Maritime Surveillance Partnership,” US Department of State, Media Note, Oice of the
Spokesperson, 31 August 2012, at http://wwwstategov/r/pa/prs/ps/2012/08/197258htm
29 “MMEA to Use Retired Aussie Boats in Straits,” New Straits Time Online, 9 November 2014, at http://
wwwnstcommy/node/50979
30 Rory Medcalf, “Jokowi’s Maritime Inaugural Address,” Lowy’s he Interpreter, 21 October 2014,
at http://wwwlowyinterpreterorg/post/2014/10/21/Jokowis-maritime-inaugural-addressaspx?
31 “New Indonesian Maritine Afairs Minister Declares War Against Illegal Fishing,” Antara News, 31
October 2014, at http://wwwantaranewscom/en/news/96351/new-indonesian-maritime-afairs-minister-declares-war-against-illegal-ishing
32 Kanupriya Kapoor and Randy Fabi, “Indonesia to Create New Coastguard, Boost Defense Spending,”
Reuters, 13 November 2014, at http://wwwreuterscom/article/2014/11/13/us-indonesia-security-idUSKCN0IX10220141113
33 Sarah Schoenberger, “Piracy in the South China Sea: Petty het in Indonesia, Kidnapped Ships in Malaysia,” CIMSEC’s Nextwar Blog, 6 September 2014, at http://cimsecorg/piracy-south-china-sea-petty-thet-indonesia-kidnapped-ships-malaysia/12899
34 Apriadi Gunawan, US Seeks to Improve Maritime Cooperation with Indonesia,” he Jakarta Post, 28
October 2014, at http://wwwthejakartapostcom/news/2014/10/28/us-seeks-improve-maritime-cooperation-with-indonesiahtml; “Jokowi-Obama Meeting: US Wants to Become Partner of Indonesia,” he President
Post, 11 November 2014, at http://wwwthepresidentpostcom/2014/11/11/jokowi-obama-meeting-us-wantto-become-a-partner-with-indonesia
35 Ben Otto, “In Myanmar, Widodo Wades Into the South China Sea,” he Wall Street Journal, 13 November 2014,
at http://blogswsjcom/indonesiarealtime/2014/11/13/in-myanmar-widodo-wades-into-the-south-china-sea/
36 Scott Cheney-Peters, “Troubled Waters: Indonesia’s Growing Maritime Disputes,” he Diplomat, 19 FebruSTIMSON CENTER | 41
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
ary 2014, at http://thediplomatcom/2014/02/troubled-waters-indonesias-growing-maritime-disputes/
37 “US-India Security and Defense Cooperation,” CSIS, as of 8 November 2014, at http://csisorg/program/
us-india-security-and-defense-cooperation
38 Akhilesh Pillalamarri, “India, Japan, and the US Hold Joint Naval Exercises,” he Diplomat, 25 July 2014, at
http://thediplomatcom/2014/07/india-japan-and-the-us-hold-joint-naval-exercises/
39 “Andaman and Nicobar Command, Pursuing Perfection through Jointness,” Andaman Chronicle, updated 8 March 2013, at http://wwwandamanchroniclenet/indexphp?option=com_content&view=article&id=25:community-newspaper-hamara-nicobar-second-edition20&catid=19&Itemid=147
40 “Seychelles, Mauritius Join Indian Ocean Maritime Security Group,” he Hindu, 7 March 2014, at http://
wwwthehinducom/news/national/seychelles-mauritius-join-indian-ocean-maritime-security-group/article5758402ece
41 Carl hayer, “Vietnam Mulling New Strategies to Deter China,” he Diplomat, 28 May 2014, at http://thediplomatcom/2014/05/vietnam-mulling-new-strategies-to-deter-china/
42 Hiebert, “US Links Arms with Vietnam”
43 “Russian Warships ‘Heading to Australia,’” News.com.au, 13 November 2014, at http://wwwnewscomau/
national/russian-warships-heading-to-australia/story-fncynjr2-1227120928528
44 Brian Murphy, “Iran and China Deepen a ‘Blue Water’ Friendship,” he Washington Post, 28 October
2014, at http://wwwwashingtonpostcom/blogs/worldviews/wp/2014/10/28/iran-and-china-deepen-a-bluewater-friendship/
45 Justin Goldman and Koh Swee Lean Collin, “SEACAT2014: Toward an enhanced US-ASEAN Maritime
Security Partnership,” PacNet 71, Paciic Forum CSIS, 4 September 2014, at http://csisorg/publication/pacnet-71-seacat2014-toward-enhanced-us-asean-maritime-security-partnership
46 James R Holmes, “Navies of the World: he Royal Navy in the Paciic,” he Diplomat, 28 May 2014, at
http://thediplomatcom/2014/05/navies-of-the-world-the-royal-navy-in-the-paciic/
47 Kevin Wong, “Shangri-La Dialogue: Singapore Continues Push for Regional HADR Centre,” IHS Jane’s
Defence Weekly, 1 June 2014, at http://wwwjanescom/article/38594/shangri-la-dialogue-singapore-continues-push-for-regional-hadr-centre
48 Scott Cheney-Peters, “he Maple Leaf Model,” CIMSEC’s Nextwar Blog, 24 July 2014, at http://cimsecorg/
the-maple-leaf-model/1991
49 Nilanthi Samaranayake, Catherine Lea, and Dmitry Gorenburg, Improving US-India HA/DR Coordination
in the Indian Ocean (Arlington, VA: CNA, 2014), pp27-28, accessed 6 November 2014, at http://wwwcnaorg/
sites/default/iles/research/DRM-2013-U-004941-Finalpdf
42 | SEA CHANGE
US Maritime Security Relations and Partnerships in the Indo-Pacific: Opportunities for Enhanced Cooperation
India’s Evolving Security Relations
and Partnerships in the Indo-Pacific
W. Lawrence S. Prabhakar
India has been expanding its economic and strategic proile steadily since 2001, with its
growing trade with Southeast Asia, East Asia, and the Paciic regions he expanding trade
proile had also witnessed the growth of its strategic capabilities, speciically its naval expansion that has come with modernization and expanding operations India’s expansion
in its “Look East Policy” has, however, gone through two stages1 In the late 1990s, it saw
India’s direction of policy adopt a Southeast Asia focus resulting in the consolidation of
its interests; with expanding economic ties and the institutionalisation of India-ASEAN
engagement Second, it witnessed growing economic interdependence, trade ties, diaspora
connections, and defense diplomacy he following decades saw the expansion of India’s
Look East Policy further eastward with Japan, South Korea, Russia, and the United States,
even as India’s economic ties swung eastward along with its strategic bilateral and multilateral exchanges India’s continued eastward focus has also been solidly based on its maritime footprint and its expanding ties brought by its engagement with Australia In 2007,
India was engaged in its Malabar Exercises with the US, Japan, Australia, and Singapore
signifying this expanding reach
India’s Maritime doctrines of 2007 and 2009 have espoused this enlargement in terms of
engaging with the Paciic nations with a prominent presence in Southeast Asia India’s
engagement with its Look East Policy has evolved in two stages: one has been with India’s
intermediate neighbourhood of Southeast Asia in the 1990s and the other with the Paciic
powers of Japan, South Korea, Russia, and Australia he dynamics of these relations have
been built primarily on economic and trade interdependence that had come along with
the deepening of security relationships hus India’s security relations and partnerships
ride on the bulwark of the economic relations he patterns of security relationships have
been bilateral and also multilateral in Southeast Asia; whereas in Northeast Asia and the
Paciic, India’s partnerships have been bilateral in scope2 India’s engagement in trade and
security ties has seen a policy and operational shit to the Indo-Paciic more than with any
other region in the world India’s membership in the various regional forums and regional
economic frameworks has provided a higher level of economic interdependence with the
region What are the deining criteria of India’s vision and geopolitics of the Indo-Paciic?
What are India’s interests in the region? How does India deine its objectives in terms of its
strategic autonomy? hese are the issues that need to be analysed
India’s Vision of the Indo-Pacific
India’s Indo-Paciic vision had emerged since 2010 with its expanding security ties to Japan,
South Korea, and in recent years with Australia With the great sway of trade - and energy
lows for India from Russia’s Sakhalin - India’s interests in the region had deepened3 While
thesw economic perspectives provide India reason enough for an enthusiastic quest for
engagement; the security and strategic quest for an increased Indian role has also been
pushing towards greater openings for India in the region Yet its engagements have been
thus far been modest India’s relatively restrained strategic perspective on the Indo-Paciic
STIMSON CENTER | 45
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
is based on the incremental nature of its interests, with its selective focus on freedom of navigation and its trade and transit interests, while carefully navigating the troubled waters of the
South China Sea In terms of its evolving policy, India prefers to maintain an “autonomous”
strategic scope of actions, without the commitment to any collective security frameworks that
the US would initiate4 India has so far preferred dedicated bilateral security partnerships and
engagements rather than any multilateral framework Even so, in its operational scope India
has expanded and engaged in naval exercises and defense cooperation with countries including the US, Japan, Australia, and South Korea Naval exercises and exercises with regard to the
other wings of the armed forces have sustained good momentum In terms of participation in
multilateral forums, India is also participating in the Western Paciic Naval Symposium and
has used its strategic relations with the US and Japan to advance its interests5
India’s Look East Policy is expanding and consolidating beyond Southeast Asia with its reach
with Japan, South Korea and Australia Economic exchanges and trade with the three powers
have increased in a substantial manner Similarly, India’s strategic engagements with the three
Paciic powers have been increasing India’s naval footprint has reached the Eastern Paciic
and it has resulted in the institutionalization of bilateral exercises with these powers
With these developments comes a question: Is there a niche for India in the Indo-Paciic
region? his is oten queried in the strategic and policy community in India and the region
India’s interests could be cast in terms of the concentric layers of its presence and engagement In the near term, India’s interests are in its own backyard and the Indian Ocean where
its engagement in the immediate neighbourhood is vital Given the prospects of challenges
and threats from Pakistan and China in the region, India’s focus has been to secure its lanks
as well as work out its naval diplomacy and build in benign naval capacity with the smaller
states in the Indian Ocean like Sri Lanka, Maldives, Seychelles, and Mauritius6 Since 2001,
India’s economic and strategic engagement with Southeast Asia has expanded incrementally with closer interdependence and strategic partnerships with several Southeast Asian
states like Singapore, Vietnam, Malaysia, Indonesia, and Philippines
India’s “Look East” Policy had incrementally expanded into East Asia, with its partnerships
with Japan exemplifying its salient economic trade and commercial partnerships Since
the Nuclear Suppliers Group (NSG) waiver for India, India and Japan have been closely
looking into bilateral strategic partnerships and naval exercises in the East Paciic India’s
engagement has also been expanding with South Korea in various areas that has resulted in
greater strategic partnership between India and the East Asian powers7 India’s engagement
with the East Asia Summit has been an important milestone as economic interdependence
expands Hence the economic rationale for strategic partnerships has been the primary
energizing source for India’s expanding role in the region
Yet another debate in the strategic community within India has been about how India
should shape its eastward engagement in the context of its strategic autonomy that dictates
that India should stand for its independent policy and should shun dependence on other
powers or being dictated to by other powers in terms of its foreign policy and security
policy here is a considerable divide in this regard over how the Indian strategic community prefers to frame this question8 Nevertheless, strategic autonomy choices in the region
must answer how rising powers could envision their role and engagement in the region
46 | SEA CHANGE
W. Lawrence S. Prabhakar
here is a divided opinion in the Indian strategic and policy community over the scope of
India’s engagement in the Indo-Paciic, even as it is engaging the neighborhood in Southeast
Asia Some see a convergence of Indian and US interests in the Indo-Paciic here are,
however, certain sections of the Indian strategic community that view the necessity of an
Indian approach to the Indo-Paciic as independent of other approaches9
Even as this remains an important factor in India’s engagement, there has been a steady
increase of India’s strategic initiatives that have come in recent years It has been exempliied in the expansion of its naval diplomacy in the region India’s naval diplomacy and
its symbolic forward presence has been the singular factor that has shaped India’s IndoPaciic operational picture10
The “Intermediate” Neighborhood
India’s engagement with its “Intermediate” neighborhood has been consistently growing since
2001 in economic, commercial, and security relationships11 India’s engagement has been
both in terms of bilateral ties and its engagement with ASEAN as a comprehensive trading
partner12 he security ties with ASEAN have been growing and in recent times India has
been a key participant in the ASEAN Defense Ministers Meeting Plus hree, and has actively
engaged in defense diplomacy and military exchanges13 Singapore tops the list of Southeast
Asian states with whom India’s initial economic ties and military ties commenced
India-Singapore: Military ties evolved from the Defense Cooperation Agreement of 2003
and the Joint Military Exercises Agreement of 2007 India’s naval exercises with Singapore
have been conducted in the Bay of Bengal and in South China Sea in 2005, 2009, and 201114
hey have been mainly joint anti-submarine warfare exercises he 2005 Singapore-Indian
Maritime Bilateral Exercise (SIMBEX) exercise was an epochal event that saw the deployment of India’s naval task force consisting of India’s lagship aircrat carrier INS Viraat
along with two powerful destroyers (INS Rajput and INS Ranjit), a missile corvette, INS
Khukri, and a leet supply ship, INS Shakti, that provided high proile deployment into
South China Sea waters15
he SIMBEX 2011 and the follow-on Annual SIMBEX exercises have sustained a continuing
willingness by India to project naval power into the South China Sea region with its exercises with the Republic of Singapore Navy (RSN)16 he momentum in defense relations was
built resulting in the enhancing of the ties in the form of Defense Cooperation Agreement
in 2003 and subsequently in the economic sphere when the Comprehensive Economic
Cooperation Agreement (CECA) emerged
India’s engagement with Singapore has been multifaceted, and has involved operational
dimensions of joint naval exercises in the South China Sea and in Indian waters; joint air
exercises; co-locating Singapore air assets in India and also naval training in surface and
sub-surface warfare, and naval aviation, etc Overall, the scope of the engagement had been
multi-tiered, employing unmanned aerial vehicles (UAVs), thermal imaging sights, and
joint execution of missions under a uniied command structure17 Singapore’s participation in the Malabar-07-02 naval exercises in the Bay of Bengal along with the US, Japanese,
Indian, and Australian navies and maritime air power has been a grand signature event for
the RSN, as it engaged in a series of exercises with the naval concert in the region
STIMSON CENTER | 47
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
he RSN’s naval exercises with India, including MILAN and SIMBEX, have been one of
the most successful bilateral exercises he scope and complexity of these exercises have
been increasing to include anti-submarine warfare exercises, besides a host of other joint
initiatives including sharing of maritime intelligence
India’s “non-intrusive approach” to Southeast Asia has been noted by the ASEAN countries
and there have always been convergences in the position of India and Singapore along with
other ASEAN states in matters of regional economic cooperation and also in terms of cooperative maritime security contending against piracy, maritime terrorism, human smuggling, and narcotics, etc, in the Andaman Sea and the approaches to the Straits of Malacca
India and Singapore have exercised in the South China Sea with units of the Eastern Naval
Command sailing into the region and have undertaken a string of such exercises with
Japan, Russia, and the United States in the Eastern Paciic
India-Malaysia: Naval engagement has been substantive and has involved reciprocal engagement in MILAN, the Defence Expo, and the Langkawi International Maritime and Aerospace
(LIMA) exhibitions Malaysia’s interest in joint development of submarine warfare tactics and
maintenance of the Scorpene submarines has been a priority with its engagement with India
Important initiatives have been made with regard to the capacity building of the Directing
Staf of the Malaysian Defence Forces, with elements of the Royal Malaysian Navy to be
trained in India18 India’s expertise in missile development, communication systems, and the
servicing of Russian military and naval hardware with regard to the Sukhoi-30 MM, and the
training of Malaysian Sukhoi pilots are all high on the agenda of the joint endeavours19
India-Indonesia: Maritime ties have been quite enduring between India and Indonesia
Security and naval cooperation emerged with the 2001 Defence Cooperation Agreement20
he India-Indonesia Joint Commission discusses various maritime issues of concern and
in the July 2012 meeting of the commission, Indonesia discussed with India about the overlapping disputed water stretches with China around the Natuna islands in the southern
reaches of the South China Sea
India has core competencies with regard to servicing of Indonesian naval hardware, while
Indonesia has evinced keen interest in importing batteries for torpedoes, engines for Parchimclass corvettes, and repair facilities for its Type 209 submarines Earlier in 2004, India sought
to institutionalize the arrangement pertaining to joint patrolling of the Malacca Straits and
the adjoining seas, although Indonesia was reluctant21 Indonesia is keen to procure naval
surveillance equipment from India like radars, and wants coproduction of defense equipment
based on the principle of maximizing comparative advantage Indonesia’s armed forces, especially its Navy, ofer a reliable partner to the Indian Navy for joint exercises
In the context of China seeking access and basing with Timor Leste, India’s engagement
with Indonesia and the vast archipelagic network ofers it several access advantages
India-Vietnam: Maritime security relations commenced with the India-Vietnam Defence
Agreement of 1994 that was later strengthened by a Defence Assistance Agreement in
2000, a Strategic Partnership Agreement in 2007, and upgraded with a Memorandum of
Understanding (MoU) on Defense Cooperation in 200922 Indian naval warships have been
visiting Vietnam since 2000 he naval and strategic engagement has gained impetus since
48 | SEA CHANGE
W. Lawrence S. Prabhakar
2009 with the MoU on Defense Cooperation he MoU enhanced the salience of coordinated patrols by the Vietnamese sea-police and the Indian coast guard, repair programs
for Vietnam Air force ighter planes, and training of Vietnamese Air Force pilots Indian
avionics supplies for Vietnamese Russian made air-to-air missiles have been notable In
2005, for instance, nearly 150 tonnes of naval accessories and ordinance were transferred
to the Vietnamese Navy23
Vietnam’s strategic calculus in the South China Sea is quite evident Vietnamese cooperation in countering China’s opposition to India in South China Sea is a vital pillar to India’s
Look East naval engagement he imperative to strengthen the surveillance and communication networks and assisting Vietnam with crucial maritime intelligence sharing have
emerged as vital objectives in the Indian collaboration with Vietnam24 India’s interest in
the Danang naval base had evident for quite some time and its use of the Cam Ranh Bay for
exercises with Vietnam in the South China Sea has been one of the locus points of India’s
naval engagement in the region
India-Philippines: Naval ties between the two countries have been derived from the 2006
Agreement Concerning Defense Cooperation, and the decision in 2009 to set up a strategic
dialogue mechanism for policy coordination In May 2012, four Indian warships visited
Philippines in Subic Bay as they journeyed across the South China Sea25 he recent confrontation of the Philippines with China over the Scarborough Shoal that had elicited tensions from both sides has enhanced Manila’s interest in defense cooperation with India
Besides the major countries of Malaysia, Singapore, Indonesia, Vietnam, and the
Philippines, India’s forward naval engagement is also building incrementally with hailand
and Cambodia Engaging these countries has garnered for India critical maritime access
and enlarged its footprint in the region, building on the synergies of existing naval exchanges with the major countries India’s contribution in terms of capacity building, maritime
infrastructure projects, turnkey projects, and maritime intelligence sharing has been vital26
India’s initiatives of the MILAN and the Indian Ocean Naval Symposium (IONS) have
accrued institutional value to the prevalent ties and have fostered better naval engagement,
providing India a naval corridor in the South China Sea all the way to the East Paciic to
engagements with Japan, South Korea, Russia, and the United States
India’s maritime multilateralism with Southeast Asia27 has all the elements of enhancing
maritime security in the region It elucidates the rights of India to trade and transit in the
South China Sea and also secures channels to the Northeast Paciic and Eastern Paciic
India’s engagement in the ASEAN Defense Ministers Meeting in the ADMM Plus is an institutional initiative of India’s security stakes in the region28 India’s trade and commerce as
well as its ambitions to build an Arctic presence and bolster its Indo-Paciic stature motivate
the Eastward expansion and consolidation
The “Extended” Neighborhood
he Indo-Paciic context constitutes the new vistas for India’s security engagement that
spawns a clear maritime vision elucidating its economic and strategic engagement with the
Indian and Paciic Oceans India’s engagement with Japan, South Korea, Australia, Russia,
and the United States encompasses trade and commercial lows towards the Paciic he
STIMSON CENTER | 49
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
Indo-Paciic perspective for India counters the Chinese assertion that India’s presence in
the South China Sea is intrusive29 Expanding India’s economic ties with Australia and
New Zealand has emerged as a new imperative given the signiicant Indian diaspora in the
region hus India’s eastward focus is now omnidirectional radiating into the Paciic in
all directions India’s engagement in the Indo-Paciic opens up strategic partnerships that
would perch India in a system-shaping role in the region
One can envision India’s strategic scheme as a “Mandala” of immediate, intermediate, and
extended concentric theatres of regions that surround India30 he Indo-Paciic opens for
India partnerships in the outer concentric circle or Mandala that is beyond the intermediate
Mandala of Southeast Asia into the East Paciic region of economic and military powers
he analysis of the scope of India’s bilateral ties with Australia, South Korea, Japan, United
States, and Russia are examined
India-Australia: he evolution and substantial growth of engagement in the India-Australia
relations has been quite recent India and Australia had travelled a very long way from the
Cold War years when Australia had viewed India along with China as potential threats to
its security and its role in the Paciic Recent developments in trade and the inluence of
the diaspora have resulted in closer convergence of bilateral relations into more credible
partnerships between the two states However there have been some divergences that have
been cited India’s strategic autonomy perspectives have been cited as obstacles to security
cooperation he fact is that India and Australia have varied strategic traditions and practices that had varied perceptions of global and regional order and apprehensions about India’s
power rise in the region However, India and Australia are now reciprocally recognizing
each other’s power potential ater the long hiatus of the Cold War years
The improvements in India-US relations and the ensuing strategic partnership had
ensured the synergy for the India-Australia partnership signed in 2009 known as the Joint
Declaration on Security Cooperation31 Some of the recent developments have been: a) India
and Australia envisage the beginning of maritime bilateral exercises with the two navies;
exercising from 2015 with a focus on anti-submarine warfare in the Bay of Bengal and in
Fremantle, Australia; b) Bilateral Humanitarian Assistance and Disaster Relief (HADR)
exercises have been conducted Other areas of cooperation have been envisaged in counter-Maritime Piracy and Maritime Domain Awareness32 hese have provided a substantial
increase in cooperative security partnerships and are considered as some of the signiicant
areas of current maritime cooperation between India and Australia China’s assertive rise
has been a key mutual concern for the two powers and Australia looks with interest on the
patterns of cooperation between India and Southeast Asia33 he recent visit of India’s Prime
Minister Narendra Modi is viewed as a signiicant catalyst to boost bilateral relations in
trade and security cooperation34
India-South Korea: India and South Korea have vital stakes in the evolution of the IndoPaciic economic order and security architecture As democracies in the Indo-Paciic region,
India and South Korea have been engaged in economic interdependence and security ties
that have been shaping the transformation of the region he economic interdependence of
the two rising powers is indeed the bedrock of the strategic partnership35 he India-South
Korean convergence is well-established and enhanced in the following areas:
50 | SEA CHANGE
W. Lawrence S. Prabhakar
Strengthening Nuclear Security is a vital priority for India and South Korea he signing of a
nuclear agreement for peaceful uses of nuclear energy between the two rising Asian powers
would bring in the synergies of South Korean technological strengths in nuclear engineering
and nuclear safety36 With the 2012 Seoul Nuclear Security summit, India and South Korea
have embraced the convergent tasks of securing the region against covert proliferation and
ensuring the security of issile materials he two powers have immense operational and intelligence capital that could be harnessed for the global commons of nuclear energy
Enhancing Maritime Security is a signiicant task for India and South Korea he imperative
to collaborate in ship-building brings to bear South Korea’s technological advantages in this
area South Korean building capacities in civilian shipping and the South Korean partnership
in Indian defense production and procurement would enhance and strengthen India’s technological prowess It would also enable the enhancement of maritime security ties through the
spectrum of benign, constabulary, and humanitarian sectors of the two navies to be forged
in strong partnership so as to establish order in the maritime commons of the Indo-Paciic37
Establishing Space Partnerships would be a new frontier even as India and South Korea
engage in transformative technologies and the build-up of space capabilities in satellites and
space launches38 Joint space exploration and the joint commitment to ensure the peaceful
uses of outer space are vital for both powers he Indian-South Korean partnership would
serve as a means to deter brinkmanship or militarization by other powers
Improving High Technology Cooperation is an important priority that harnesses the scientiic and technological capital of India and South Korea towards the development and
expansion of high-technology Technological innovation has been critical in the Asian
powers’ rise Harnessing the technological dividend and investing in the development
of dual-use technologies salient for industry would be highly important even as the two
powers continue to rise39
Engaging in Military Interoperability is of strategic consequence India and South Korea
could expand into areas of joint warfare doctrine, counter-terrorism, special operations
forces training and exercises, and most importantly in intelligence cooperation40
In summation, the bilateral aspects of the global security issues between the two Asian
democracies create joint stakes in augmenting regional stability, leading towards a crucial
convergence Even as the Indo-Paciic economic and strategic order transforms, the essence
of concert among democratic powers in the region can provide a framework of cooperation
India-Japan: he wide spectrum of strategic trends in the Indo-Paciic have resulted in the
close nurturing of strategic partnerships between India and Japan Since 2004, a growing
convergence has been witnessed with the United States attempting to build partnerships
with various regional powers with the themes of economic interdependence and on the
normative plank of a concert of democracies to counter the assertive rise of China as well
as to mitigate its own deiciencies
India and Japan have moved to closer partnership in a variety of ields ranging from transfer
of civilian technology to security partnership to nuclear technology transfer initiatives Indian
Prime Minister Narendra Modi’s recent successful visit to Tokyo yielded much productive
STIMSON CENTER | 51
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
results in overall ties, but did not further the nuclear cooperation between the two powers as
expected by India Indian and Japanese initiatives have, however, addressed the wider region
of the Indo-Paciic, as well as the bilateral context of their growing strategic convergence41
he Strategic Dialogue and Security Partnership has been the primary means of closer IndiaJapan security cooperation he Aso-Singh declaration of Security Cooperation of 2008 provides the basis of the India-Japan security partnership42 his framework envisages establishing the Strategic and Global Partnership that is driven by converging long-term political,
economic, and strategic interests, aspirations and concerns he declaration undergirds policy
coordination on regional afairs in the Indo-Paciic region and on long-term strategic and
global issues It also expands defense dialogue and cooperation within the framework of the
earlier Joint Statement signed in May 2006 between the two Defense Ministries he AsoSingh Declaration also set forth several cooperative mechanisms that would implement the
various parameters of the strategic dialogue and the security partnership
Defense Diplomacy has been yet another vital instrument of strategic cooperation between
India and Japan Elements of this initiative range from joint military training, exercises,
and the Malabar exercises that involve Japan along with the US, Australia, and Singapore,
as well as the Indian Navy task force exercises in the Yokosuka Bay in the Eastern Paciic
India and Japan have also worked out elaborate protocols of cooperation between their respective coast guards and their navies in the Indian Ocean he India-Japan Joint Working
Group is also exploring the co-production of the US-2 amphibian aircrat for search and
rescue eforts India could use it for landing a small group of troops for short strikes close
to the sea coast or to maintain surveillance in the Sea Lanes of Communication Defense
Diplomacy is a new area that brings Japanese military technology and operational practices
that would enhance the efectiveness of India’s military43
India-Japan Nuclear Technology Partnership has been an important milestone in the strategic partnership between the two powers his aimed to enable transfer of Japanese civilian
nuclear technology to India Japan has backed the Indo-US nuclear deal and the exemptions
given to India from international technology sanctions44 India and Japan had expressed their
commitment to continue to work to prepare the ground for India to become a full member in
the international export control regimes: the Nuclear Suppliers Group, the Missile Technology
Control Regime, the Australia Group, and the Wassenaar Arrangement However, recent talks
between the Indian Prime Minister Narendra Modi and Japanese Prime Minister had not
resulted in a conclusive nuclear agreement between the two powers
India-Japan Maritime Security Ties have assumed much importance since 2008 With
the Japanese participation in the anti-piracy patrols in the Arabian Sea and its access to
Djibouti, the presence of Japanese Maritime Self Defense force destroyers has aided in securing sea-lane security and energy security for Japanese shipping in the region India and
Japan have been regularly conducting exercises between their navies and the respective
Coast Guards Japan and India have already started a 2 + 2 dialogue (at secretary level) and
an annual exercise called (JIMEX)45 In 2012 Japan participated in the Indian Ocean Naval
Symposium for the irst time
In summation, the strategic trends in the Indo-Paciic relect a dynamic environment
that is fast-paced and involves a power-shift among the great powers and changing
52 | SEA CHANGE
W. Lawrence S. Prabhakar
economic-strategic dynamics among Japan, India, South Korea, and Australia he future
of China and the role of the United States will be the net strategic factors that would determine the responses of the region India and Japan are entering into a period characterized
by greater economic and strategic convergence Greater economic interdependence, technology transfers, and development of a strategic partnership could shape the Indo-Paciic
strategic architecture
India-United States: India and the United States have featured a convergent relationship
since the Bush Administration he hallmarks of the bilateral strategic partnership have
been forged on the basis of common interests and shared strategic vision he prevalent bilateral activities have hinged on the annual Malabar exercises between India and the United
States that in some cases have included Japan and Australia
India and the United States have signed $13 billion in defense contracts that include major
deals for military transport aircrat and attack and heavy-lit helicopters Yet, India’s decision in 2011 to exclude two US companies from a bidding process to ill its requirement
for 126 Medium Multi-role Combat aircrat and its preference of the French Rafale Fighter
attack aircrat was a substantial setback for the United States
India is reluctant to sign US defense technology protection agreements as it had argued
that this would afect its strategic autonomy and its technological security requirements46
hree areas merit to be highlighted: a) bilateral defense trade cooperation; b) Militaryto-military cooperation; and c) Homeland security cooperation However, there is the US
reluctance to transfer certain high-end technology due to its laws and it is a major stumbling block in bilateral relations On the other hand, there has been India’s refusal to sign
certain agreements, viz the Logistic Support Agreement (LSA) and the Communication
Interoperability and Security Memorandum of Agreement (CISMOA) which is a major inhibiting factor in Indo-US defense cooperation47 India’s stand on the above agreements is
that these are restrictive and acceding to them is against its principle of strategic autonomy
India-Russia: India and Russia have a strategic partnership that has been modest India and
Russia have been conducting joint naval exercises, called INDRA, in Indian Ocean and in
the Far East India aims at opening opportunities for the Northern Sea route to the Arctic
In terms of defense technology collaboration, India and Russia have been working on the
Brahmos missile as well as a prospective collaboration on Fith Generation Combat aircrat
India has been buying Russian built frigates, destroyers, and conventional submarines, and
leasing a nuclear attack submarine One of the major highlights of the India-Russia partnership has been the civilian nuclear cooperation that has resulted in Moscow’s willingness
to build, operate, and transfer Russian nuclear reactors to India However, there is also the
negative consequence of Moscow’s potential export of sensitive defense technology to China
that has an adverse impact on the national security of India as Russian military technology
could eventually reach Pakistan via China48
In all these strategic partnerships, India has not chosen alliance as an instrument of forging closer
relations India’s reliance on strategic partnerships is undertaken with the aim of forging collaborations for technology transfer and co-development, while retaining its strategic autonomy
STIMSON CENTER | 53
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
Dynamics of Engagement
India’s Look East Policy is expanding and consolidating beyond Southeast Asia to reach
Japan, South Korea, and Australia India’s engagement has also been expanding with South
Korea in various areas of engagement that has resulted in greater strategic partnership
between India and the East Asian powers India’s engagement with the East Asia Summit
has been an important milestone as economic interdependence expands Hence the economic rationale for strategic partnerships has been the primary energizing source for
India’s expanding role in the region here has been a steady increase of India’s strategic
initiatives that have come in recent years It has been exempliied in the expansion of its
naval diplomacy in the region
India’s maritime strategy has been evolving to a deinitive eastward focus since 2007 he
release of its capstone maritime doctrine of Indian Maritime Doctrine INBR 8 (April 2004)
was the basis of India’s naval activism his was followed by other statements such as the
Indian Navy’s Vision Statement (May 2006) and its Roadmap to Transformation (October
2006) he Freedom to Use the Seas: India’s Maritime Military Strategy (September 2007)49
was the benchmark document that provided the impetus of a new Indian vision articulating its eastward focus Several platform and infrastructure developments attest to the
growing interest of India for adding sinews to its eastern leet that is gaining momentum
with hosting and conducting leet exercises with the Southeast Asian navies and with the
Paciic powers like South Korea, Japan, the United States, and even Russia50
he deployment of taskforces has been a frequent event with the Eastern Fleet, even as the
Navy has dispatched taskforces into the South China Sea and beyond to the Paciic In June
2012, the Eastern Fleet task force of four warships embarked on a visit to East Asia carrying
out exercises with the Japanese Maritime Self Defense Force In route to the north-eastern
Paciic, the ships made port calls in Malaysia, Vietnam, Indonesia, and Philippines On the
return journey, the task force also embarked on exercises with China’s People’s Liberation
Army-Navy (PLAN) he deployment of annual task forces to Southeast Asia and the Paciic
signiies India’s intent and capability to retain and sustain the economic and energy interests in the Sakhalin and the strategic stake of the Navy in the Paciic he deployment of
taskforces and the expeditionary capability relect the Indian Navy’s objective of “desired
power projection force levels, undertake military operations other than war and the ability
to inluence events ashore”51
he deployment of the taskforces has been sustained with various tiers of exercises with
Southeast Asian navies and the Paciic navies of South Korea, Japan, Russia, and the United
States, demonstrating the capacity and varied complexity of the platforms with various
naval forces he deployment of taskforces and the exercises symbolize the Indian Navy’s
sustained intent and capacity for closer naval partnerships with the region’s navies
Expanding its great power naval engagement, India joins the great power concert in the
Indo-Paciic with its maritime forward presence India features as a major power along with
Japan and South Korea in terms of economic and strategic engagement India’s naval engagement in the region will continue as a signiicant factor even as the PLAN naval expansion and its surge into the Indian Ocean region continues India sees strategic engagement
in its ties with Southeast Asian navies and a counter-bulwark to the PLAN expansion in the
54 | SEA CHANGE
W. Lawrence S. Prabhakar
region Even as India expands its naval engagements with the United States, Japan, South
Korea, Russia, and Australia in the Eastern Paciic as well as in the Indian Ocean region,
India’s role as a signiicant power in the region enhances its credibility India’s gradual increase of the size and the sophistication of its warship dispatches into the region and the
increasing complexity of its naval exercises with Paciic powers of Japan and South Korea,
together with its participation in the Western Paciic Naval Symposium and the enlargement of the Malabar series within Indian and the Paciic waters burnishes India’s credentials and constitute an important benchmark of its power status52 With the Indo-Paciic
gaining signiicance in the context of the new power alignments, the US rebalancing to the
Paciic and the US access to Darwin in Australia--all raise the prospect of India’s greater
naval involvement in this theatre
he Indian Navy’s exercises with Southeast Asian navies have varied levels of scope with the
diferent naval forces of the regions, demonstrating the increasing importance of interoperability Indian naval operations have the objective to develop capacity for interoperability
with the various Southeast Asian navies, although each force varies in terms of diferent
operational capacities and platform capabilities Interoperability may not always be feasible
with the vast diferences in training, operations, and platforms, yet the exercises with each
of the navies provide the Indian Navy familiarity of operations and development of capacity Although the exercises cannot accrue real ofensive capability, the scope in terms of cooperative and constabulary elements remains high From the Indian Navy’s point of view,
these exercises enhance maritime domain awareness, sharing of maritime intelligence, and
increase the benign scope of ties India’s hosting of the MILAN and Indian Ocean Naval
Symposium reciprocally brings in the Southeast Asian navies to Indian waters for similar
exercises that serve to enhance interoperable features of the various operational capacities
of the diferent navies with the Indian Navy Interoperability serves as the benchmark of the
closer degree of naval cooperation and operational capacity he Indian Navy’s operational
capacity and its doctrinal focus endeavor towards greater cooperative capacity between its
force and the navies in the region53
Sustaining a strong naval footprint represents a strategic priority for the Indian Navy, even
as it adds new platforms into the Eastern Fleet India’s nuclear submarine platform is deployed in the Eastern Fleet and the addition of the INS Vikramaditya, India’s next aircrat
carrier, to the Eastern Fleet will signiicantly enhance carrier air power With the increase of
the frigates and destroyers to the leet that comes by way of the carrier task group; it would
provide the lateral platform expansion that comes along with the new combat capabilities he newly inducted “Shivalik” and “Teg” class ships are a manifestation of the navy’s
desire to acquire strategic assets he INS Teg, inducted in May 2012, followed by the INS
Sahyadri, commissioned a few weeks later, are the two latest multi-purpose frigates to have
joined the Fleet54 he frigates are tasked for a broad spectrum of maritime missions that
adds to the “strategic posture” and are deployable for long-term maritime missions India’s
support ships like long range oil tankers are being added to the leet to provide longer legs
to sustain the naval footprint in the region India is also negotiating with Russia for three
additional frigates of the Krivak-IV class that would serve to increase the platform numbers
and enhance combat versatility of the leet deployments55
STIMSON CENTER | 55
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
In summation, the analysis of India’s engagement in the Indo-Paciic has been premised
on India’s growing trade, commercial investments, and economic interdependence that has
directed the strategic engagement with the region India’s role in the region is expanding
in terms of how its presence and partnerships could shape the Asian security architecture
that has important strategic implications
India’s imperatives lie in sustaining its economic development and growth, while cultivating strong commercial and technological partnerships with Southeast Asia, Japan, South
Korea, and Australia Enduring partnerships with these powers encompass a crucial system-shaping diplomatic synergy for India and are extremely vital for India to be taken
seriously in the region
India’s crucial balancing role in a prospective US-China duopoly of the Asia-Paciic regional
order would serve to enhance its presence and would augur a meaningful role for its power
With the discontents of an assertive China and a dilemma ridden American power, India’s
role and stabilizing impact would build the sinews of a regional order that is not entirely
swayed to the ruthless hegemony of China nor sufers from the pangs of the US strategic
challenges of staying engaged in the region In an obvious power transition, India’s normative leadership backed by its pragmatic calculus of economic strength and strategic capacity
would provide the necessary foundations of India’s place in East Asia and the Indo-Paciic
About the Author
W Lawrence S Prabhakar is Associate Professor, International Relations and Strategic
Studies, Department of Political Science Madras Christian College, Chennai He is also
Visiting Professor, Department of Geopolitics, Manipal University Dr Prabhakar’s PhD
degree is in the area of Strategic Studies from the University of Madras, Chennai, India
He specializes in academic and policy research on nuclear missile issues in Southern Asia;
on maritime security issues in the Indian Ocean and the Asia-Paciic Region; the Grand
Strategy of China and of India; and on research in India-United States strategic relations
His books are he Maritime Balance of Power in the Asia-Paciic: Maritime Doctrines and
Nuclear Weapons At Sea (Singapore: World Scientiic Publications, 2006); Maritime Security
in the Indian Ocean Region: Critical Issues of Debate (New Delhi: Tata-McGraw Hill, 2008)
His research fellowships have been at the Institute of Defence and Strategic Studies (200405) where he worked on his irst book; teaching at S Rajaratnam School of International
Studies Nanyang Technological University, Singapore (2007); the Fulbright Fellowship at the
Center for Political Studies, Institute of Social Research, University of Michigan; and Policy
Research Fellowships as Visiting Fellow, he Henry L Stimson Center, Washington, DC; the
Center for Naval Analysis, Alexandria, Virginia; the Center for Strategic and International
Studies, Washington, DC; the Asia-Paciic Center for Security Studies, Honolulu, Hawaii;
and the Research School of Paciic and Asian Studies, Australian National University,
Canberra, Australia His numerous other publications have appeared in reputed international and national journals and edited volumes
56 | SEA CHANGE
W. Lawrence S. Prabhakar
Notes
1 For a comprehensive analysis, see SD Muni, “India’s Look East Policy: he Strategic Dimension,” ISAS
Working Paper No: 121 (Singapore: Institute of South Asian Studies, 2011)
2 Shyam Sharan, “Mapping the Indo-Paciic,” Commentary, Centre for Policy Research, accessed at http://
wwwcprindiaorg/blog/borders/3574-mapping-indo-paciic on 19 November 2014
3 Saurav Jha, “Energy Interests Make India A Player in South China Sea Disputes,” World Politics Review,
11 February 2013, accessed at http://wwwworldpoliticsreviewcom/articles/12706/energy-interests-make-india-a-player-in-south-china-sea-disputes on 19 November 2014
4 CRaja Mohan, “India: Between Strategic Autonomy and Geopolitical Opportunity,” Asia Policy, No15,
January 2013, (Seattle, WA: National Bureau of Asia Research), pp 21-25
5 David Brewster, India as An Asia Paciic Power (Oxford: Routledge, 2012)
6 Nilanthi Samaranayake, “India: Still at he Center of the Indian Ocean,” Yale Global Online, 22 February
2013, accessed at http://yaleglobalyaleedu/content/india-still-center-indian-ocean on 19 November 2014
7 Harsh V Pant, “Looking East: India’s Growing Role in Asian Security,” Commentary, 12 September 2013, accessed at http://wwwnbrorg/downloads/pdfs/outreach/NBR_IndiaCaucus_Sept2013pdf on 19 November 2014
8 David Scott, “he ‘Indo-Paciic’— New Regional Formulations and New Maritime Frameworks for IndiaUS Strategic Convergence,” Asia-Paciic Review Vol19, No2 (2012), pp85-109
9 Priya Chacko, “India and the Indo-Paciic: hree Approaches,” he Strategist, he Australia Strategic
Policy Institute Blog ASPI 24, January 2013, accessed at http://wwwaspistrategistorgau/india-and-the-indo-paciic/ on 19 November2014
10 Abhijit Singh, “Rebalancing India’s Maritime Posture in the Indo-Paciic,” he Diplomat, 5 September
2014, accessed at http://thediplomatcom/2014/09/rebalancing-indias-maritime-posture-in-the-indo-pacific/ on 19 November 2014
11 For a detailed analysis, see Lawrence Prabhakar Williams, “India’s Expanded Maritime Mandala: Naval
Intent and Strategy in Southeast Asia,” in Ajaya Kumar Das ed, India-ASEAN Defence Relations, RSIS
Monograph No28 (Singapore: S Rajaratnam School of International Studies, 2013), at http://wwwrsisedu
sg/wp-content/uploads/2014/07/Monograph2813pdf
12 “Agreement on Trade in Goods Under the Framework Agreement on Comprehensive Economic
Cooperation Between the Republic of India and the Association of Southeast Asian Nations,” accessed at
http://commercegovin/trade/asean-india%20trade%20in%20goods%20agreementpdf on 19 November 2014
13 Vijay Sakhuja, “ADMM Plus: Enhancing Asia-Paciic Security,” Viewpoint, Indian Council of World
Afairs, 22 June 2010, http://wwwicwain/pdfs/ADMMpdf, accessed on 19 November 2014
14 David Brewster, “India’s Defence Strategy and the India-ASEAN Relationship,” in Ajaya Kumar Das ed,
India-ASEAN Defence Relations.
15 David Brewster, “India’s Security Partnership with Singapore,” Paciic Review, Vol22, No5 (December
2009), pp 597–618
16 “Indian, Singaporean Navies Hold War Game in China’s Backyard,” IANS, 24 March 2011
17 Lawrence Prabhakar Williams, “India’s Expanded Maritime Mandala: Naval Intent and Strategy in
Southeast Asia”
18 Pankaj Kumar Jha, “India’s Defence Diplomacy in Southeast Asia,” Journal of Defence Studies, Vol5,
No1 (January 2011)
19 “Malaysia to Ask India to Train Pilots for Sukhoi Jets,” he Hindu, 11 June 2006
20 Pankaj K Jha, “India-Indonesia: Toward Strategic Convergence,” IDSA Comment, 24 January 2011,
accessed at http://wwwidsain/idsacomments/IndiaIndonesiaTowardsStrategicConvergence_pkjha_240111
on 19 November 2014
21 Vibhanshu Shekhar, “India-Indonesia Relations: An Overview,” IPCS Special Report, No 38, March 2007,
accessed at http://wwwipcsorg/pdf_ile/issue/477138183IPCS-Special-Report-38pdf on 19 November 2014
STIMSON CENTER | 57
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
22 PS Suryanarayana, “India, Vietnam agree to irm up defence ties,” he Hindu, 28 July 2010, accessed at http://
wwwthehinducom/news/india-vietnam-agree-to-irm-up-defence-ties/article536828ece on 19 November 2014
23 “Enhancing Indo-Vietnam Defence Cooperation: Vietnamese Perspective,” Paper Presented by
Lieutenant Nguyen hang Anh at Joint USI-IDIR Seminar, Delhi, 4 October 2007; “India boosts defence
cooperation with Vietnam,” Vietnam Plus, 24 September 2013, accessed at http://envietnamplusvn/Home/
India-boosts-defence-cooperation-with-Vietnam/20139/39302vnplus on 19 November 2014
24 Carl hayer, “How India-Vietnam Strategic Ties are Mutually Beneicial,” he Diplomat, 3 December
2013 accessed at http://thediplomatcom/2013/12/how-india-vietnam-strategic-ties-are-mutually-beneicial/
on 19 November 2014
25 Indrani Bagchi, “Four Navy Ships in South China Sea to Mark Indian Presence,” Times of India, 24 May 2012
26 Lawrence Prabhakar Williams, “India’s Expanded Maritime Mandala: Naval Intent and Strategy in
Southeast Asia”
27 W Lawrence S Prabhakar, “Maritime Security Triangulation of ASEAN-Australia-India: An Indian
Perspective,” in William T Tow and Chin Kin Wah eds, ASEAN, India, Australia: Towards Closer
Engagement in a New Asia (Singapore: Institute of Southeast Asian Studies, 2009)
28 Anit Mukherjee, “ADMM-Plus: Talk Shop or Key to Asia-Paciic Security?” he Diplomat, 22 August
2013, accessed at http://thediplomatcom/2013/08/admm-plus-talk-shop-or-key-to-asia-paciic-security/1/
on 19 November 2014
29 Brian Stoddart, “India and the South China Sea,” Global Policy, 1 July 2014, accessed at http://www
globalpolicyjournalcom/blog/01/07/2014/india-and-south-china-sea on 19 November 2014
30 See Vijay Sakhuja, Asian Maritime Power in the 21st Century: Strategic Transactions, China, India and
Southeast Asia (Singapore: Institute of Southeast Asian Studies, 2011), pp 68–69; Lawrence Prabhakar
Williams, “India’s Expanded Maritime Mandala: Naval Intent and Strategy”; W Lawrence S Prabhakar,
“Maritime Security Triangulation of ASEAN-Australia-India: An Indian Perspective”
31 David Brewster, “he Australia-India Security Declaration: he Quadrilateral Redux?” Security
Challenges, Vol6, No1 (Autumn 2010), pp1-9
32 C Raja Mohan, “India and Australia: Maritime Partners in the Indo-Paciic,” he Asia Link Essays2011, Vol3, No7 (November 2011), accessed at http://asialinkunimelbeduau/__data/assets/pdf_
ile/0008/505628/Maritime_Partners_in_the_Indo-Paciicpdf 19 November 2014
33 Amitabh Mattoo and Ashok Malik, “Abe + Abbott + Modi: he AAM trilateral that could stop China’s rise
ET Commentary,” he Economic Times, 4 September 2014 accessed at http://articleseconomictimesindiatimes
com/2014-09-04/news/53563697_1_coal-india-prime-minister-narendra-modi-uranium on 19 November 2014
34 Abhijit Singh, “he Emerging India-Australia Maritime Relationship,” he Diplomat, 17 November
2014, accessed at http://thediplomatcom/2014/11/the-emerging-india-australia-maritime-relationship/ on
19 November 2014
35 Lakhvinder Singh, “he importance of South Korea: a strategic perspective on India’s engagement with
Northeast Asia,” Korean Journal of Defense Analysis, Vol20, No3 (2008), pp283-294; Il-young Kim and
Lakhvinder Singh, “Asian Security and India-Korea Strategic Cooperation,” Korean Journal of Defense
Analysis, Vol14, No1 (2002)
36 Pranamita Baruah, “India-ROK Nuclear Cooperation: Is it a Win-Win Situation?” IPCS
#3439, 16 August 2011, accessed at http://wwwipcsorg/article/india/india-rok-nuclear-cooperation-is-it-a-win-win-situation-3439html on 19 November 2014
37 Sukjoon Yoon, “Middle-Power Cooperation between South Korea and India: Hedging the Dominance of
the Great Powers,” PacNet Number 10, Paciic Forum, CSIS, Honolulu, Hawaii, 28 January 2014, accessed at
http://csisorg/iles/publication/Pac1410pdf on 19 November 2014
38 Sreeram Chaulia, “South Korea Calling India,” he Diplomat, 18 January 2014, accessed at http://thediplomatcom/2014/01/south-korea-calling-india/ on 19 November 2014
39 “India and South Korea: Strategic ‘Partners’ with Long term Goals,” Stratrisks, 8 July 2013, accessed at
http://stratriskscom/geostrat/13863 on 19 November 2014
58 | SEA CHANGE
W. Lawrence S. Prabhakar
40 Amb HE Joon-gyu Lee, “India-South Korea Strategic Partnership,” IPCS Special Report, May 2013, New
Delhi, Institute of Peace and Conlict Studies, accessed at http://wwwipcsorg/special-report/east-asia/india-south-korea-strategic-partnership-140html on 19 November 2014
41 Titli Basu, “Shinzo Abe’s Visit to India: Reviewing the Strategic Partnership,” IDSA Comment, 27 February
2014, accessed at http://wwwidsain/idsacomments/ShinzoAbesVisittoIndia_tbasu_270214html on 19
November 19 2014; Rajiv Nayan, “India-Japan Strategic Partnership,” IDSA Comment, 11 June 2013, accessed
at http://wwwidsain/idsacomments/IndiaJapanStrategicPartnership_rnayan_110613 on 19 November 2014
42 “Joint declaration on Security Cooperation between India and Japan,” Press Information Bureau, 22 October
2008, Government of India, accessed at http://pibnicin/newsite/ereleaseaspx?relid=44047 on 19 November 2014
43 Nitin A Gokhale, “Modi, Japan and Diplomatic Balancing,” he Diplomat, 3 September 2014, accessed
at http://thediplomatcom/2014/09/modi-japan-and-diplomatic-balancing/ on 19 November 2014
44 Pravakar Sahoo and Abhirup Bhunia, “India and Japan boost cooperation, but no nuclear power deal,”
East Asia Forum, 11 September 2014, accessed at http://wwweastasiaforumorg/2014/09/11/india-and-japan-boost-cooperation-but-no-nuclear-power-deal/ on 19 November 2014
45 Tomoko Kiyota, “Assessing Japan-India Relations: A Japanese Perspective,” IPCS Article # 4329, 7 March
2014, accessed at http://wwwipcsorg/article/india/assessing-japan-india-relations-a-japanese-perspective-4329
html on 19 November 2014; Abhijit Singh, “Rebalancing India’s Maritime Posture in the Indo-Paciic”
46 Lisa Curtis, “Going the Extra Mile for a Strategic US–India Relationship,” Backgrounder # 2719 on Asia
and the Paciic, 20 August 2012, accessed at http://wwwheritageorg/research/reports/2012/08/going-theextra-mile-for-a-strategic-us-india-relationship on 19 November 2014
47 Saroj Bishoyi, “Logistics Support Agreement,” Journal of Defence Studies, Vol7, No1 (2013), pp151172, accessed at http://wwwidsain/jds/7_1_2013_LogisticsSupportAgreement_SarojBishoyi; Anit
Mukherjee and Manohar hyagaraj, “Competing Exceptionalisms: US-India Defence Relationship,”
Journal of Defence Studies, Vol6, No2 (2012), pp12-28, accessed at http://wwwidsain/jds/6_2_2012_
CompetingExceptionalisms_AnitManohar on 19 November 2014
48 Vinay Shukla, “Russia to remain under India’s radar under Modi,” Eurasia Outlook, Carnegie Moscow
Center, 21 May 2014, accessed at http://mceiporg/moscow/eurasiaoutlook/?fa=55660 on 19 November 2014
49 Indian Navy, Freedom to Use the Seas: India’s Maritime Military Strategy (New Delhi: Integrated
Headquarters, Ministry of Defence, 2007)
50 Abhijit Singh, “he Indian Navy’s New ‘Expeditionary’ Outlook,” ORF Occasional Paper # 37, October
2012 (New Delhi: Observer Research Foundation), accessed at http://orfonlineorg/cms/export/orfonline/
modules/occasionalpaper/attachments/occasional_37_1351144676325pdf on 19 November 2014
51 “12th Defence Plan: Focus on Navy’s ‘expeditionary’ ops,” he Indian Express, 4 May 2012, accessed at
http://wwwindianexpresscom/news/12th-defence-plan-focuson- navy-s--expeditionary--ops/945283
52 David Scott, “India and the ‘Allure of the Indo-Paciic’,” International Studies, Vol 49, Nos3&4 (JulyOctober 2012)
53 Abhijit Singh, “India’s Maritime Outlook Acquires Strategic ‘Het’,” National Maritime Foundation,
15 August 2012, accessed at http://wwwmaritimeindiaorg/Commentaries/India-Maritimehtml on 19
November 2014
54 Ibid
55 See Singh, “India’s Maritime Outlook Acquires Strategic ‘Het’”; Walter C Ladwig III, “Delhi’s Paciic
Ambition: Naval Power, “Look East”, and India’s Emerging Inluence in the Asia-Paciic,” Asian Security
Vol5, No2 (2009), pp87-113
STIMSON CENTER | 59
India’s Evolving Security Relations and Partnerships in the Indo-Pacific
60 | SEA CHANGE
Island States in a Region of Great Powers
Nilanthi Samaranayake
his paper analyzes the perspectives and priorities of Indian Ocean island states—especially Sri Lanka—in a region of great powers Analysis of international relations in the IndoPaciic is understandably focused on the great powers such as India and the United States,
but the examination oten ends there Although the region’s island countries may be small,
their strategic locations, their relations with traditionally dominant India, their growing
ties with China, and rising trade and investment opportunities—especially in infrastructure development—make them an important area of analytical inquiry
here are three unifying aspects of Indian Ocean island states (namely, Sri Lanka, Maldives,
Seychelles, Mauritius, and Madagascar) that reside in a region of great powers First, they
have common needs such as building capacity for their maritime security services Second,
while they derive multiple beneits from great powers like India, island states share common
concerns regarding the room to crat independent foreign policies and perceptions of the
misuse of their territory by great powers hird, despite their smaller size, they possess surprising strengths such as their strategic locations; ability to lend unique expertise to larger
powers; or potential to cause a wedge in great power coordination, even if unintentional,
such as between the United States and India
Despite the oten-discussed potential for great power rivalry in the Indian Ocean, smaller
island countries’ growing ties with extra-regional states such as China are not undermining India’s traditional dominance in the region Certainly, China’s equities are inexorably
rising in the Indian Ocean Yet island states are open to Indian, US, Chinese, Japanese, or
other countries’ assistance if it can help them grow, especially by improving connectivity
Moreover, despite anxiety over Beijing’s support of maritime infrastructure throughout the
region, India increasingly derives commercial beneits from these projects and connectivity
Still, New Delhi should redouble its lending and construction capabilities so that India is
seen as a more viable alternative to China for island states in the Indian Ocean No matter
who funds this infrastructure, it will allow these countries to trade more within their
borders, with each other in the region, and beyond
Common Needs
Indian Ocean island states need capacity In addition to having broader national development goals, they face various maritime security challenges like piracy, human smuggling,
arms and narcotics traicking, and illegal ishing To address these threats, the island states
depend on great powers for assistance such as equipment (as well as parts and servicing),
training, and exercises to help their smaller navies and coast guards, which in turn helps
advance regional maritime security
India’s assistance to these island states is quite signiicant For example, the Mauritius Coast
Guard is run by a deputed Indian Navy oicer, with the Indian Navy giting and servicing
patrol boats, exercising, joint patrolling, and cooperating on hydrography Just in the past
year, India’s equipment assistance to Mauritius has been striking: an Indian-built ofshore
patrol vessel was exported to Mauritius in August 2013, making it the irst ever warship to
STIMSON CENTER | 61
Island States in a Region of Great Powers
be exported by India1 India handed over three new Islander aircrat engines and critical
spares, as well as an inshore hydrographic survey vessel to Mauritius earlier in 2013 In 2014,
Mauritius ordered a $205 million fast patrol vessel from India to be built in Goa Shipyard,
including machineguns and ammunition
As with Mauritius, India provides Maldives with regular surveillance and hydrographic services as well as gited and serviced assets for the Maldives National Defense Force
(MNDF), including most recently two Dhruv advanced light helicopters Maldives has
beneited from a US-built maritime surveillance system, which was completed in January
2013, as well as India’s commitment in 2009 to build coastal radars on each of the 26 atolls,
although only a handful have been installed so far he United States has been working with
Maldives on environmental security, with rising sea levels posing the greatest existential
threat to Maldives of any country in the Indian Ocean US Paciic Command (PACOM)
conducted a 2014 environmental security workshop with the MNDF which examined oil
spill response and disaster management, among other areas
In Sri Lanka, India ofers a wide range of security assistance, coordination, and senior
oicial visits India’s training capability is well regarded in particular, especially among
Sri Lanka Navy oicers, who regard it as India’s major contribution to their maritime security forces as well as to other branches of Sri Lanka’s military In fact, the commander of
the army, Lieutenant General Daya Ratnayake, stated as recently as November 2014 that
the Indian Army “provides more than 80% of overseas training opportunities to the Sri
Lankan Armed Forces, for which we are grateful”2 In terms of equipment, India is building two ofshore patrol vessels that are intended for delivery during 2017–18 SLINEX is
an exercise between the Sri Lankan and Indian navies that began in 2005 Yet with Sri
Lanka having no available ships to exercise during its war against the Liberation Tigers
of Tamil Eelam (LTTE), the exercise was suspended and did not resume until 2011, of
Trincomalee It was next held of Goa in 2013 Furthermore, the Indian Navy provides
vital survey assistance and engages in staf talks (most recently in the summer of 2014)
In contrast with India, US military assistance is low, due to prohibitions following human
rights concerns over the government’s conduct of the inal phase of the war against the
LTTE insurgency
In Seychelles, the Indian Navy conducts surveillance and hydrographic work in the exclusive economic zone (EEZ), which is of considerable beneit to the Seychellois Coast Guard
India gited a fast attack crat in November 2014, in addition to one in 2005 India also supplied a Dornier maritime surveillance aircrat he United States includes the Seychelles
Coast Guard in its multinational Cutlass Express maritime training exercise in East Africa
(Kenya, Tanzania, and Djibouti) In Madagascar, India reportedly has had a monitoring
station since 2007 as its irst listening post on foreign soil, which is intended to relay intelligence back to commands in Mumbai and Kochi he Indian Navy’s MILAN exercise
in February 2014, which was its biggest ever with 17 countries in total, included the island
states Seychelles, Mauritius, Maldives, and Sri Lanka
In addition to regular capacity-building, island states have needed assistance from great
powers following natural disasters Ater the 2004 tsunami, the Indian Navy provided
62 | SEA CHANGE
Nilanthi Samaranayake
vital irst responder aid to Sri Lanka under “Operation Rainbow,” and to Maldives under
“Operation Castor” he previous year the Indian armed forces had provided relief to Sri
Lanka under “Operation Denim” following widespread looding US naval forces also provided important disaster relief ater the tsunami under “Operation Uniied Assistance”
Unlike India, China’s security assistance to these island states is currently minimal, but can
be expected to grow as Beijing increases its equities in the Indian Ocean During Sri Lanka’s
war against the LTTE, China’s weapons support was vital considering that the United
States and India imposed oicial embargoes on lethal assistance China’s security assistance
has decreased ater the war concluded, but defense relations have continued he Chinese
defense minister visited Sri Lanka in 2012, and China installed a new defense attaché in
Colombo at the Senior Colonel or Brigadier rank in August 2013 In addition, China has
ofered $100 million to the Sri Lanka Army to support infrastructure projects In Maldives,
China committed last year to giting a $32 million sea ambulance to the Maldives Coast
Guard, although the vessel has not yet been delivered In Seychelles, China has provided
two patrol crat for counterpiracy purposes and training
Despite these activities, China’s position in the Indian Ocean remains signiicantly weaker
than that of India, which has the advantage of a central geographic position India has
further strengthened its formidable air and sea power in the region and intensiied its bilateral activities with island states3 Moreover, New Delhi has begun to move beyond bilateral
engagement with these countries through trilateral maritime security coordination with
Sri Lanka and Maldives At the time of writing, this trilateral has consistently grown to
feature concrete outcomes:
1 hree meetings were held at the National Security Advisor-level since 2011
2 An accord was signed in July 2013 agreeing to maritime domain awareness (MDA)
cooperation,4 EEZ surveillance, search and rescue (SAR), initiatives to curb marine
pollution, and exercises5
3 A March 2014 meeting at the NSA-level discussed new areas of cooperation in maritime
security, including hydrography and training in visit, board, search and seizure operations6 Delegations from Mauritius and Seychelles also participated as guest countries
4 In 2012, Sri Lanka was added to the two-decade old Indian-Maldivian coast guard exercise called DOSTI, which was held of Male, Maldives In December 2013, the three
forces conducted a second trilateral coast guard exercise of Trincomalee, Sri Lanka,
which included a tabletop exercise on Indian ships about pollution response and a
seminar on oil spills, as well as work on counterpiracy and SAR In October 2014, the
three countries repeated the DOSTI coast guard exercise of Male
5 In March 2014, the Indian Coast Guard conducted a one-week SAR training in Mumbai
for ive Coast Guard Oicers each from Sri Lanka and Maldives
he arrangement is likely to become known as the “Indian Ocean-5” given deep interest
by Mauritius and Seychelles Furthermore, India is altering its internal bureaucratic orientation toward the Indian Ocean and smaller island states he near abroad division of
the Ministry of External Afairs has been reorganized within the past year by subdividing
STIMSON CENTER | 63
Island States in a Region of Great Powers
Bangladesh and Myanmar into their own division and creating the Sri Lanka, Maldives,
and Indian Ocean division, which includes the smaller island countries beyond India’s
traditional near abroad
Common Concerns
In addition to having common needs, island states have common concerns regarding
great powers As developing nations, island states try to derive multiple beneits from great
powers like India and the United States But their assistance from these powers can also be
of concern regarding their autonomy and room to crat independent foreign policies For
example, although India’s vital assistance in disaster relief no doubt beneits island states,
such operations give the Indian military operational reach in these countries’ territory An
Indian armed forces oicer interviewed explained that through the provision of disaster
relief, a military inevitably gains knowledge of how to operate in the host nation Under
“Operation Rainbow,” the Indian Navy was able to mobilize and reach Sri Lanka just 12
hours ater the tsunami struck in 2004
he Indian military’s role in averting coups in Indian Ocean island states is another example
of the double-edged nature of military aid Under “Operation Cactus” in 1988, Indian Navy
frigates captured plotters undertaking a coup attempt in Maldives Similarly, around the
time of political turmoil in Maldives in 2012, there were reports that the Indian Navy had
two ships operating near Maldives in the event former President Mohamed Nasheed needed
assistance7 Indian Navy oicers also describe a plan reportedly from the 1980s to airlit
Sri Lanka President Ranasinghe Premadasa from Colombo in the event of a coup attempt
Coups were also averted in Seychelles in 1986,8 under “Operation Flowers Are Blooming,”
and in Mauritius under “Operation Lal Dora” in 19839
More ominously, however, smaller states can fear combat situations such as the 1987 entry
of the Indian Peacekeeping Force (IPKF) in Sri Lanka under “Operation Pawan,” which
aimed to take control of Jafna from the LTTE and enforce disarmament under the IndoLanka accord Sri Lankan President JR Jayawardene arguably signed the agreement under
less than ideal conditions for Colombo’s interests
he historical precedent set by such operations—whether for disaster relief or combat
purposes—weighs on decision makers in island states when they consider the potential
efect of being seen as challenging Indian interests in the neighborhood In the case of Sri
Lanka, the outcome of a 1987 exchange of letters between Prime Minister Rajiv Gandhi
and President JR Jayawardene was that Jayawardene agreed that “Trincomalee or any
other ports in Sri Lanka will not be made available for military use by any country in
a manner prejudicial to India’s interests” hese letters were exchanged in the context
of Colombo’s growing relationship with Washington and reported US interest in an oil
tank farm in Trincomalee close to Indian territory he training of Tamil militants in
Indian camps and the entry of the IPKF are oten cited by Sri Lankan experts as examples of the consequences of challenging India’s dominance in the region10 More recently, when President Mahinda Rajapaksa wanted to develop a port in his home district
of Hambantota, he irst consulted India and even the United States for investment and
reached out to China ater India and US investors passed on the request11 Controversy
in media analysis over September and October 2014 port visits by conventional People’s
64 | SEA CHANGE
Nilanthi Samaranayake
Liberation Army-Navy submarines to a Chinese-built terminal in Colombo port inlamed
Indian sensitivities over foreign presence in Sri Lanka’s ports An unnamed Ministry of
Defense oicial states that a redline for India would be if China sent a nuclear submarine
to Colombo, or if a submarine paid a visit to Trincomalee in northern Sri Lanka and away
from the main east-west sea lanes12
Beyond India, extraregional great powers can also cause concern over perceptions of the
misuse of island states’ territory European countries have territories in the Indian Ocean,
such as the British Indian Ocean Territory But Mauritius is campaigning for recognition
of sovereignty over the Chagos islands, which includes the British and US military base of
Diego Garcia, whose 50-year lease to the US Navy is set to expire in 201613 he Mauritian
efort is unlikely to be successful, but illustrates the dissatisfaction of smaller island states
with the use of their territory by great powers Similarly, there were perceptions of potential
misuse of island states’ territory ater the news broke in 2013 that Washington was pursuing
a status of forces agreement (SOFA) with Maldives that would have allowed rights for US
military personnel visiting the country, such as during the Coconut Grove exercise that US
and Maldivian marines conduct Male eventually rejected the proposed agreement
Outside the realm of military afairs, smaller island states are dependent on India for trade
and economic interactions, but fear the loss of assistance and engagement if they cross
New Delhi For example, ater Maldivian president Mohammed Waheed terminated a contract for an Indian company called GMR to develop Maldives’ only international airport,
Maldivians saw India as retaliating by removing a special permission which resulted in
cuts to the shipment of construction materials to the atoll nation14 Four infrastructure
projects were adversely afected due to this move and larger chill in bilateral relations India
also changed visa regulations, which made obtaining visas more diicult for Maldivians
traveling to India in the wake of Male’s cancellation of the GMR contract15 Finally, ishing
disputes between northern Sri Lankan ishermen and Indian ishermen in Tamil Nadu state
loom large in Sri Lanka and raise territorial concerns beyond Colombo’s interactions with
New Delhi he actions of southern Indian ishermen are perceived as an encroachment on
Sri Lanka’s national resources given the importance of ish in the local diet and the problem
of overharvested and declining ish stocks
Surprising Strengths
In addition to common needs and common concerns, island states also possess surprising
strengths with regard to great powers Despite their need for capacity, it is important to
remember that island states can lend unique expertise to larger powers or are situated in
strategic locations For example, Sri Lanka and Maldives are situated along the main eastwest sea lanes Moreover, Sri Lanka’s Navy has years of experience conducting small boat
tactics and asymmetric warfare operations due to its 26-year war against the LTTE Its
counter-swarm attack tactics could be useful to the US Navy, for example, in an Iran scenario Meanwhile, Seychelles allows US Africa Command (AFRICOM) to base MQ-9 Reaper
Unmanned Aerial Vehicles for intelligence, surveillance, and reconnaissance purposes
Missions are for counterpiracy (of Somalia) and counterterrorism (Shabab in Somalia)
Maldivian coast guard oicers interviewed point out the beneits of MDA that is not technology-driven, but from ishermen in this close-knit society While some claim that the
culture can be too intrusive on a personal basis, at least Maldives’ MDA purposes are well
STIMSON CENTER | 65
Island States in a Region of Great Powers
served through the Maldives Coast Guard’s close ties with ishermen about any aberrant
activity along the coastline
Second, island states can cause a wedge in great power coordination, even if unintentional Two recent examples involving the United States and India are worth highlighting16
First, the United States proposed a SOFA with Maldives, which was eventually rejected
by the Maldivian president in January ater India relayed concern about the agreement
and the implications if China wanted to pursue a similar arrangement Furthermore,
in March 2014, India did not support a US-sponsored resolution in the United Nations
Human Rights Council calling for an international investigation into the way the Sri
Lankan government conducted the end of its war in case it had committed human rights
violations All indications were that New Delhi would support the resolution, as it did in
the previous two years, but despite this, India abstained A US State Department spokesperson said aterwards: “It is disappointing to us that India abstained from voting on this
resolution when they voted yes for the last two years We have made our disappointment
known to Indian oicials”17
Conclusion
While great-power relations in the Indian Ocean deserve the attention they receive, there
should be more analysis of smaller island states hese countries should be examined as a
discrete grouping both because they are of interest to great powers, which provide them
with important assistance, and because their strategic locations make them integral to the
region Smaller island states have assets that can contribute to regional maritime security,
thereby lessening the burden on the great powers
Despite fears that Chinese assistance will create great power rivalry in the Indian Ocean,
smaller island countries, by accepting Chinese aid, are not contesting or seeking to undermine India’s traditional dominance in the region Oten it is assumed that these countries
are trying to “play” India of against China18 However, this thinking attributes more intention and capability than small island states actually have to inluence the situation Island
states want to be open to Indian, US, Chinese, Japanese, or any countries’ assistance if it can
increase their security and improve their infrastructure and connectivity
In the case of Sri Lanka, China has been a key funder and builder of new infrastructure
in Sri Lanka, with loans and other assistance for the construction of a power plant, a deep
seaport and airport in Hambantota, and a terminal at the congested Colombo port, which
has already helped to expedite trade in one of the busiest ports in South Asia Chinese stateowned enterprises have also built the irst highways in Sri Lanka, connecting Colombo to
major locations in the south Interestingly, despite the controversy over Beijing’s support
of Hambantota and the strategic implications for New Delhi, India is getting some commercial beneits from the use of this port Hambantota is now occupied with transshipping
automobiles from India that are meant for East African markets, and also South America
and eastern Europe
Japan is another great power with growing interests in smaller island states In March 2013,
Prime Minister Shinzo Abe signed a joint statement with Sri Lankan president Mahinda
Rajapaksa to increase maritime security and coast guard cooperation Abe traveled to Sri
66 | SEA CHANGE
Nilanthi Samaranayake
Lanka in September 2014, becoming the irst Japanese leader to visit in 24 years Colombo
is anticipating the provision of Japanese patrol vessels Meanwhile, Japan has also assisted
Maldives through the construction of a “safe island” with breakwater protection of Male in
recognition of the large number of Japanese tourists to the low-lying islands
India is clearly concerned about China’s infrastructure activities in Sri Lanka and
elsewhere in the Indian Ocean such as the Maritime Silk Road, which Maldives
has also endorsed China may even invest in a transshipment port in the northern
Ihavandhippolhu atoll Yet, New Delhi’s response to these activities should not be to
criticize smaller island countries, which have national development goals to meet, but
to redouble its lending and construction capabilities so that India is seen as a more
viable alternative to China Intra-regional trade in South Asia is quite low, constituting less than 5 percent of the region’s total trade according to the Asian Development
Bank, compared to Southeast Asia, for example, where trade among the members of the
Association of Southeast Asian Nations (ASEAN) represents 26 percent of total trade19
No matter who funds this infrastructure—it will allow these countries to trade more
within their borders, with each other in the region, and beyond The expansion of this
trade is in the interests of all great powers
About the Author
Nilanthi Samaranayake is an Asia analyst at CNA Corporation, a non-proit research and
analysis organization located in the Washington, DC, area Her research focuses on South
Asia and Indian Ocean security Prior to joining CNA Corporation, Samaranayake completed a fellowship at the National Bureau of Asian Research (NBR) in Seattle, where she
investigated Sri Lanka’s deepening economic, military, and diplomatic ties with China
Her indings were published in the peer-reviewed journal, Asian Security Samaranayake’s
recent work includes a speech on Indian Ocean strategy at the 2013 Galle Dialogue in
Sri Lanka; a talk at the Carnegie Endowment for International Peace on smaller South
Asian countries’ views of India’s naval rise; and a talk at the American Security Project on
Bangladesh’s foreign relations Her research has been featured in World Politics Review,
he National Interest, South Asia Journal, YaleGlobal, Asia Paciic Bulletin, and PacNet She
has appeared in media such as Al Jazeera, Daily Star (Bangladesh), Myanmar Times, and
Maclean’s (Canada) Most recently, she authored a book chapter on the smaller countries
of South Asia and their relations with China that was published in China and International
Security: History, Strategy, and 21st Century Policy, edited by Donovan Chau and homas
Kane (Praeger, 2014) Samaranayake analyzed public opinion for a decade at Pew Research
Center in Washington, DC While there, she twice directed the quadrennial survey,
“America’s Place in the World” Samaranayake holds an MSc in International Relations
from the London School of Economics and Political Science
STIMSON CENTER | 67
Island States in a Region of Great Powers
Notes
1 Joyanta Gupta, “Mauritian warship to be launched in Kolkata,” Times of India, 2 August 2013 at http://
timesoindiaindiatimescom/city/kolkata/Mauritian-warship-to-be-launched-in-Kolkata/articleshow/21540817cms
2 Sri Lankan Army, “Delegation from India’s Army War College Calls on Commander of the Army,” 10
November 2014, at http://wwwarmylk/detailedphp?NewsId=8810
3 Nilanthi Samaranayake, he Long Littoral Project: Bay of Bengal - A Maritime Perspective on
Indo-Paciic Security (Arlington, VA: CAN, September 2012) at http://wwwcnaorg/research/2012/
long-littoral-project-bay-bengal
4 For example, sharing of automatic identiication system data, long range identiication and tracking services and merchant ship information system for tracking merchant vessels
5 Government of India, “Outcome Document of the Second NSA-Level Meeting on Trilateral Cooperation
on Maritime Security between India, the Maldives and Sri Lanka,” 9 July 2013, Ministry of External Afairs,
at http://wwwmeagovin/bilateral-documentshtm?dtl/21922/Outcome+Document+of+the+Second+NSALevel+Meeting+on+Trilateral+Cooperation+on+Maritime+Security+between+India+the+Maldives+and+Sri+Lanka; Sri Lanka Ministry of Defence and Urban Development, “NSA level meeting on trilateral Maritime
Security Cooperation between India, Sri Lanka and Maldives,” 3 July 2014 at http://wwwdefencelk/newasp?fname=NSA_level_meeting_on_trilateral_Maritime_Security_Cooperation_between_India_20140307_05
6 Government of India, “NSA level meeting on trilateral Maritime Security Cooperation between India,
Sri Lanka and Maldives,” 9 July 2013, Ministry of External Afairs, at http://wwwmeagovin/press-releases
htm?dtl/23037/NSA+level+meeting+on+trilateral+Maritime+Security+Cooperation+between+India+Sri+Lanka+and+Maldives
7 Haveeruonline, “Two Indian naval ships were near Maldives on Feb 7: ex-Defence Minister,” 19 January
2013 at http://wwwhaveerucommv/news/46907
8 “How Indian Navy averted a Coup in Seychelles? Operation lowers are blooming,” Indian Defence Forum,
13 July 2012, at http://defenceforumindiacom/forum/indian-navy/38974-how-indian-navy-averted-coup-seychelleshtml
9 Sandeep Dikshit, “When India drew Top Secret ‘red line’ in Mauritius,” he Hindu, 10 March 2013 at http://
wwwthehinducom/news/national/when-india-drew-top-secret-red-line-in-mauritius/article4492148ece;
David Brewster and Ranjit Rai, “Operation Lal Dora: India’s Aborted Military Intervention in Mauritius,”
Asian Security, Vol9, No1 (2013)
10 Nilanthi Samaranayake, “China’s Relations with Smaller Countries of South Asia,” in China and International Security: History, Strategy, and 21st Century Policy, Donovan C Chau and homas M Kane, eds (Santa
Barbara, CA: ABC-CLIO, 2014)
11 Nilanthi Samaranayake, “Are Sri Lanka’s Relations with China Deepening? An Analysis of Economic, Military, and Diplomatic Data,” Asian Security, Vol7, No2 (2011); “Almost a revelation by Rajapaska?” Times of
India TimesNow TV, at http://wwwtimesnowtv/Did-India-let-the-Chinesein/videoshow/4388691cms
12 Ajai Shukla, “New Delhi woos island states, but China looms large in Indian Ocean,” he Business Standard, 7 November 2014, at http://wwwbusiness-standardcom/article/current-afairs/new-delhi-woos-islandstates-but-china-looms-large-in-indian-ocean-114110601141_1html
13 Maggie Ybarra, “Navy base on the line as Mauritius tries to pit US, UK in island’s sovereignty bid,” he
Washington Times, 14 April 2014, at http://wwwwashingtontimescom/news/2014/apr/9/navy-base-on-theline-as-mauritius-tries-to-pit-us/?page=all#pagebreak
14 Ahmed Naish, “Four MTCC harbour projects stalled over lack of construction material,” Minivan News
(Maldives), 21 May 2013, at http://devjmaldivesindependentcom/politics/four-mtcc-harbour-projectsstalled-over-lack-of-construction-material-58266
15 “India tightens visa rules for Maldivians,” he Economic Times, 17 December 2012, at http://articleseconomictimesindiatimescom/2012-12-17/news/35868815_1_visa-rules-visa-regulations-issue-visas
16 Nilanthi Samaranayake, “US, India’s Goals Diverge in New Delhi’s Near Abroad,” World Politics Review, 13
68 | SEA CHANGE
Nilanthi Samaranayake
May 2014, at http://wwwworldpoliticsreviewcom/articles/13775/u-s-india-s-goals-diverge-in-new-delhi-snear-abroad
17 US Department of State, “US-led UN Human Rights Council Resolution / India’s Abstention,” Press Briefing, 28 March 2014, at http://wwwstategov/r/pa/prs/dpb/2014/03/224104htm
18 Shukla, “New Delhi woos island states, but China looms large in Indian Ocean”; Harsh V Pant, Island
Nations Play China, India,” YaleGlobal Online, 9 January 2013, at http://yaleglobalyaleedu/content/island-nations-play-china-india
19 M Absar Alam, “Process of Cooperation and Integration in South Asia: Issues in Trade and Transport Facilitation,” VIKALPA, Vol39, No1 (2014) at http://wwwvikalpacom/pdf/articles/2014/vikalpa-39-1-87-102pdf
STIMSON CENTER | 69
Island States in a Region of Great Powers
70 | SEA CHANGE
The Changing Balance of Power in the Indian Ocean:
Prospects for a Significant Chinese Naval Presence
David Brewster
his paper examines the growth of China’s naval presence in the Indian Ocean as part of
the changing balance of power in the region It makes two basic arguments: irst, that China
faces considerable strategic disadvantages in the Indian Ocean; and second, that China has
few dependable security relationships in the region his paper argues that China will ind it
diicult to mitigate its strategic vulnerabilities in the Indian Ocean As a result, while Beijing
may seek to use the prospects of a substantial naval presence for strategic leverage, it will
likely only develop a signiicant military presence in the region in response to speciic threats
he balance of power in the Indian Ocean is changing quickly, driven by a perceived erosion
of the longstanding strategic predominance of the US Navy and the rise of China and India
as major powers his is a three-sided dance But strategic competition in this region is
currently more pronounced between China and India than between either of them and
the United States Perhaps the United States, which has been the predominant power in
the Indian Ocean for decades, is a known quantity and considered less likely to take unpredictable actions that would threaten trade lows in the region Although perceptions of
US decline are overdrawn, both Beijing and Delhi take the view that US presence in the
region will continue to decline in relative terms and that, therefore, time is on their side As
a result, strategic instability in the region is much more a function of competition between
China and India, as they jostle for inluence and port access in ways reminiscent of USSoviet rivalry during the Cold War
Many believe that China is in the process of establishing a signiicant naval presence in
the region But is this a likely outcome in the near term? his paper argues that China
will ind it diicult to substantially mitigate the geostrategic disadvantages it faces in the
Indian Ocean As a result, while short term deployments of the Chinese navy may be used
for signalling purposes, arguably it would make little strategic sense for Beijing to commit
substantial defense resources to the region
China’s Fundamental Geostrategic Vulnerabilities
in the Indian Ocean
he starting point of any analysis of China’s strategic position in the Indian Ocean is its vulnerability China faces profound strategic challenges in the Indian Ocean region that cannot
be easily overcome, and this has a signiicant efect on the strategic dynamics China’s overwhelming strategic imperative in the Indian Ocean is the protection of its sea lines of communication (SLOCs) across the Indian Ocean, particularly with regard to the transport of
energy he most important of these SLOCs extends from the Persian Gulf through the Strait
of Hormuz, around the Indian subcontinent, and then through the Straits of Malacca into the
Paciic Ocean Other important SLOCs extend across the Indian Ocean from Suez and across
the northern Indian Ocean as well as from the southern tip of Africa across the central Indian
Ocean China is probably most vulnerable in the Malacca Strait, through which around 82%
of its oil imports pass1 According to former Chinese President Hu Jiantao, this chokepoint
STIMSON CENTER | 71
The Changing Balance of Power in the Indian Ocean: Prospects for a Significant Chinese Naval Presence
represents China’s “Malacca Dilemma”2 China also faces a so-called “Hormuz Dilemma” in
the Persian Gulf, where some 40% of its oil imports transit the Strait of Hormuz However,
China faces a strategic dilemma across most of the Indian Ocean, where China’s SLOCs are
vulnerable to threats from both state and non-state actors
China’s vulnerability in the Indian Ocean is principally a function of geography he Indian
Ocean is a largely enclosed ocean, with few entry points and vast distances between them
his creates a strategic premium for powers that are able to control the so-called chokepoints
and deny their rivals access to ports in the region For more than ive hundred years, since the
Portuguese adventurer, Afonso de Albuquerque, transformed the Indian Ocean into a mare
clausum (“closed sea”) over which Portugal had exclusive jurisdiction, competing powers have
jostled over control of the Indian Ocean he United States has not generally pursued a chokepoint strategy since it became the predominant power in the Indian Ocean in the early 1970s
But the Indian navy’s 2007 Maritime Military Strategy expressly invokes Albuquerque’s name
to justify India’s strategy of seeking control over the Indian Ocean chokepoints3
China’s vulnerability is reinforced by the scarcity of overland connections between China
and the Indian Ocean Formidable geographic barriers created by the mountain ranges,
deserts, and jungles along the southern edge of the Eurasian continent make such links
very diicult and, until well into the twentieth century, there were no major transport
routes—roads, railways or rivers—connecting China with the Indian Ocean Even today,
there are only a handful of tenuous north-south links across the southern Asian littoral
his disconnect has severely limited China’s presence and inluence in the Indian Ocean
region and narrows China’s strategic options Virtually all of China’s trade with Europe and
the Middle East must cross the Indian Ocean
his geography has a particular impact on the China-India strategic relationship In strategic
terms the Indian Ocean represents “exterior lines” for China and “interior lines” for India he
Indian subcontinent dominates the entire northern Indian Ocean and gives India a geographic, economic, and demographic centrality in the region his provides India with considerable
military advantages, including short lines of communication to its own bases and resources
China has corresponding disadvantages, including the need to deploy its naval forces to the
Indian Ocean through narrow and dangerous chokepoints and then ind logistical support
when it arrives4 As Admiral Mehta, India’s former Chief of Naval Staf, commented, “he
weak area for China today is the Indian Navy We sit in the Indian Ocean and that is a concern
for China and they are not happy as it is not so easy for them to come inside”5
China’s weaknesses in the Indian Ocean contrast with its considerable advantages over
India in other dimensions, including its economic power and the balance of conventional and nuclear forces his creates an unusual dynamic As John Garver, an expert on
Sino-Indian relations, comments: “in the event of a PRC-ROI [People’s Republic of ChinaRepublic of India] conlict, India might be tempted to escalate from the land dimension,
where it might sufer reverses, to the maritime dimension, where it enjoys substantial
advantages, and employ those advantages to restrict China’s vital Indian Ocean trade”6
From this perspective, any mitigation of China’s relative vulnerability in the Indian Ocean
could have a signiicant efect on the balance of power between India and China But India’s
response to any Chinese presence in the Indian Ocean is not just about maintaining a strategic
72 | SEA CHANGE
David Brewster
bargaining chip here is also a sense that the Indian Ocean is India’s legitimate sphere of
inluence China’s refusal to acknowledge India’s special role in the Indian Ocean is seen as
part of its refusal to acknowledge India’s status as an emerging power7
China is trying to mitigate its vulnerabilities in the Indian Ocean in several ways: irst,
through building capabilities to project limited naval and air power into the Indian Ocean;
second, through gaining access rights to ports (and perhaps air bases) in the region; and third,
by developing limited overland transportation links between southern China and the Indian
Ocean But, as will be discussed, in the short to medium term these will have only a marginal impact on China’s fundamental strategic disadvantages China’s position in the Indian
Ocean is fundamentally diferent from say the South China Sea, where China is in a position
to achieve predominance against local players and may therefore see beneit in creating an
atmosphere of intimidation In the Indian Ocean, China may be better placed in reducing
regional threat perceptions and developing a substantial military presence only in response to
what are regarded as legitimate threats his paper will consider irst how China is seeking to
mitigate its strategic vulnerabilities and then its overall strategy in the Indian Ocean region
China’s Power Projection Capabilities in the Indian Ocean
his paper will not seek to describe China’s naval expansion and modernisation program,
which has been described in detail elsewhere8 However, it is important to note that while
China’s naval capabilities are growing quickly, its power projection capabilities in the Indian
Ocean are limited and are likely to remain so in the foreseeable future Although it has
made small deployments in the western Indian Ocean, the People’s Liberation Army (PLA)
Navy is not a true blue water navy and has limited experience in projecting power beyond
coastal waters China has a limited number of blue water naval combatants Its ability to
project naval power into the Indian Ocean is also highly constrained by the long distance
from Chinese ports (the closest Chinese naval base being at Hainan Island in the South
China Sea), the need to deploy through the narrow chokepoints through the Indonesian
archipelago, and the lack of logistical facilities in the Indian Ocean To compound this, the
PLA Air Force currently has extremely limited capabilities in the region
he PLA Navy is seeking to gradually normalize its presence in the Indian Ocean But
although Chinese naval activity in the region has increased over the last twelve months it
remains at relatively low levels he PLA Navy has made almost continuous deployments
of two to three vessels in the western Indian Ocean since 2008 as part of anti-piracy operations and this has also provided political cover for increased submarine deployments
he PLA Navy has participated in a handful of naval exercises in the Indian Ocean with
Pakistan, most recently in September 2014 In January 2014, three Chinese warships undertook China’s irst brief unilateral exercise in the Indian Ocean, just south of Indonesia9
Between September and November 2014, a Chinese nuclear-powered (but conventionally
armed) submarine made an unusual series of port calls to Colombo along with a tender he
purpose of these visits were unclear, but they occurred in conjunction with the announced
upgrade of India-Vietnam defense cooperation, including the possible sale of India’s highly
capable Brahmos anti-ship missiles to Vietnam and they may have been intended as signals
to India to restrain its presence in the South China Sea
STIMSON CENTER | 73
The Changing Balance of Power in the Indian Ocean: Prospects for a Significant Chinese Naval Presence
here is little doubt that China has long term aims to develop its capabilities in the Indian
Ocean But the growth of the PLA Navy presence in the Indian Oceans may also relect the
ambitions of a “Cinderella” service that is highly subordinated to the PLA in China’s Central
Military Command Like the Indian Navy, which is known as the “Cinderella” of the Indian
armed forces, the PLA Navy could well be demonstrating that it can carve a space out for
itself his may lead it to act more assertively than would otherwise be warranted
China’s String of Pearls or Maritime Silk Road
For around a decade, some analysts have argued that China is seeking to mitigate its weaknesses
in the Indian Ocean through pursuing a “String of Pearls” strategy During this period, Chinese
companies have been involved in the funding and construction or upgrade of several commercial port facilities in the region, including at Gwadar in Pakistan, Hambantota in Sri Lanka, and
Sittwe and Kyaukpyu in Myanmar It is claimed that as quid pro quo, the PLA Navy has been
granted rights to develop a permanent presence at those port facilities or to even develop bases
he String of Pearls narrative in its various forms has become a prominent factor in Indian
public discourse about China and its intentions in the Indian Ocean10 But most informed
analysts now acknowledge that it is unlikely that China would want to establish formal
naval bases in most of these so-called “Pearls” US analysts have pointed out that converting
the ports of Gwadar (Pakistan) and Hambantota (Sri Lanka) into naval bases would require
billions of dollars in investment in order to ensure their viability in wartime, and that their
exposed position would make them diicult to defend against an enemy equipped with
long-range precision strike capability11 Nor would a permanent Chinese naval presence
at these ports prevent the interdiction of Chinese energy supplies elsewhere in the Indian
Ocean Indeed to properly mitigate its vulnerabilities in the Indian Ocean, China would
need to be able to defend the entire length of its SLOCs that run from inside the Persian
Gulf around the Indian subcontinent and through the Malacca Straits
he debate has shited towards whether China is pursuing a “places not bases” strategy
to give China the lexibility to respond to speciic threats “Places not bases” refers to the
US post-Cold War strategy of seeking to avoid the political and economic costs associated
with permanent US bases in foreign countries in favour of more lexible arrangements that
guarantee the US military access to critical infrastructure in times of crisis Such a strategy
would make considerable sense for China, especially in light of the potentially high political
costs that may be associated with establishing a permanent naval base in the Indian Ocean
Chinese vessels on anti-piracy deployment in the western Indian Ocean already regularly
use the ports of Djibouti, Salalah (Oman) and Port Victoria (Seychelles) for ad hoc logistical
support alongside vessels from many other navies China has also reportedly been ofered
the more permanent use of facilities at Djibouti alongside France, the United States, Japan
and several other navies12 In the central Indian Ocean, recent port visits to Sri Lanka by
a Chinese submarine point to Colombo or Hambantota as nodes for logistical support for
the PLA Navy and potentially also the PLA Air Force13
But a “places not bases” strategy would only have a signiicant efect on the regional balance
of power to the extent that it would provide Beijing with a reasonable degree of certainty that
facilities would be available in the event of an acute crisis or conlict he PLA Navy may have
use of facilities to develop a regular small presence in the Indian Ocean, but what countries
74 | SEA CHANGE
David Brewster
in the region would guarantee the PLA Navy access to facilities in the event of an acute crisis
involving India or the United States? As discussed later, there are currently few candidates for
this role, although this list could easily grow in the event of signiicant changes in the strategic
environment his means that China (like the Soviet Union during the Cold War) will likely
be highly dependent upon aloat support for leet logistics in the Indian Ocean
China ofers a very diferent narrative about its ambitions in the region Beijing has latly
denied that it has any intention to establish military bases in the region14 and argues that
the various Chinese-sponsored port projects in the Indian Ocean are purely commercial
in nature Since late 2013, Beijing has been pushing its “Maritime Silk Route” initiative as
a proposed oceanic “Silk Route” that would complement its overland Silk Route projects in
Central Asia he proposal appears to envisage a system of linked ports and infrastructure
projects and special economic zones in Southeast Asia and the northern Indian Ocean
Several states in the region have indicated an in-principle agreement to participate in the
initiative, although Delhi remains suspicious Details remain sketchy, but the initiative
may involve the development of new production and distribution chains across the region,
with China at its center—possibly something akin to Japan’s “Flying Geese” strategy of the
1960s and 70s in which component production was successively outsourced by Japanese
companies to tiers of lower-cost states in Southeast Asia15 If nothing else, in seeking to
explain China’s presence in the region in cooperative economic terms, the Maritime Silk
Route initiative provides an alternative narrative to the String of Pearls
The Development of Overland Connections to the Indian Ocean
China is also mitigating its strategic vulnerability through developing new overland transport connections to the Indian Ocean, especially through Myanmar and Pakistan China
has recently completed a new connection to the Indian Ocean through Myanmar, involving
oil and gas pipelines between China’s Yunnan province and a new port at Kyaukpyu he
development of the oil pipeline appears to have been heavily inluenced by Beijing’s concerns over its Malacca Dilemma, although some of these justiications seem questionable16
he strategic value to China of the new port is also severely limited by the lack of road and
rail links to China Myanmar has reportedly had second thoughts about allowing China
to build a 1,200 kilometer railway to Kunming at an announced cost of $20 billion, due to
concerns over Chinese control over the route17
An even more ambitious project is the “Bangladesh-China-India-Myanmar (BCIM)
Economic Corridor,” which would involve the development of road connections and manufacturing facilities in a corridor between Kunming and Kolkata via Myanmar, India’s
northeast states, and Bangladesh Although Delhi has agreed to undertake a study of the
proposal, the current Indian government is wary of its economic and strategic implications,
particularly to India’s undeveloped and politically unstable northeast states
China has also mooted plans to develop a major new corridor between its western Xinjiang
province and the Pakistani port of Gwadar on the Arabian Sea at an announced cost of $18
billion18 his would include road/rail links to Karachi and a pipeline and road/rail link to
Gwadar But these would traverse regions of Pakistan where there are signiicant security
risks which makes it diicult to envisage that China could depend upon (or even build) such
links to Gwadar in the current security environment
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The Changing Balance of Power in the Indian Ocean: Prospects for a Significant Chinese Naval Presence
he trans-Myanmar and Pakistan projects are part of Beijing’s “bridgehead strategy” of
turning its landlocked Yunnan and Xinjiang provinces into gateways for engagement with
the Indian Ocean19 If completed, the projects would have major implications for China’s
role in the region, stimulating the development of China’s southern provinces and considerably expanding China’s inluence in Pakistan, Myanmar, and other states hese projects
may also give China a greater stake in the internal security of Pakistan and Myanmar
Historically, Beijing has largely avoided involvement in Pakistan and Myanmar’s domestic
problems, but this may become more diicult to sustain China has already deployed security forces in Pakistan-administered Kashmir near the Chinese border to provide security
for its construction and maintenance workers from attacks from Islamic and tribal groups20
If these projects go ahead, China could ind itself securing corridors extending across much
of Pakistan or Myanmar But while these new connections would deinitely expand China’s
strategic options, they would have only a limited impact on China’s vulnerability in the
Indian Ocean For example, the Kyaukpyu-Kunming oil pipeline would account for only
34% of China’s total oil imports by 203021 Pipelines are highly vulnerable to interdiction,
and would not reduce China’s vulnerability in the Strait of Hormuz
China’s Security Partners in the Indian Ocean
China’s strategic vulnerabilities in the Indian Ocean mean that it will be highly reliant
on local partners to support any naval presence to the extent that it is unable to rely upon
aloat support here are widespread perceptions in public debate and academic literature
of a growing contest for inluence across the Indian Ocean region, including a new “Great
Game” (especially between China and India) over the control of and access to ports and
other infrastructure
China’s economic inluence is growing quickly throughout the Indian Ocean region in
line with its rise as a world economic power China is now the biggest trading partner for
many states in the Indian Ocean region and a major source of investment Many analysts
assume that this will inevitably translate into strategic inluence, although the evidence so
far is mixed Although China is an active arms supplier to many states, with the exception
of Pakistan, it has few comprehensive security partnerships in the region China is a major
source of arms to Pakistan, Myanmar, Bangladesh, Sri Lanka, and others his is driven
by several factors: the inexpensiveness of Chinese arms (an important factor for most), the
existence of arms embargos (which have afected states such as Pakistan, Myanmar and
Sri Lanka), and balancing considerations (which is important for states such Bangladesh)
Some states such as Sri Lanka appear to be using China to hedge their relations with the
United States and India Small islands such as Maldives and Seychelles from time to time
also play the “China card” in an efort to extract concessions or assistance from India But
signiicantly, no Indian Ocean state with the exception of Pakistan realistically considers
China to be a security provider or security guarantor Indeed, it could be argued that the
strategic position of Indian Ocean states vis-à-vis China has some similarities with East
Asia, where many have also sought to balance China’s growing power by strengthening
their security relationships with the United States and, increasingly, also with India In
other words, there is a dichotomy between China’s signiicant economic power and its relatively limited security role It is likely that the United States will remain the most important security partner for most states in the Indian Ocean region for the foreseeable future
76 | SEA CHANGE
David Brewster
he major exception to this analysis is Pakistan, which, alongside its relationship with
North Korea, is the closest China has come to a long-term ally China has supplied arms to
Pakistan since the 1960s and played a key role in proliferating nuclear weapons and missiles to Pakistan In recent years, Pakistan has indicated its readiness to host Chinese naval
facilities at the port of Gwadar, although China has responded cautiously to these suggestions22 China may eventually choose to establish a small naval (and, possibly, air) presence
at Gwadar On the other hand, while the United States maintains predominance in the
Persian Gulf and is able to maintain freedom of navigation through the Strait of Hormuz,
China may have little immediate reason to do so he cancellation of the planned visit of
Chinese President Xi Jinping to Islamabad in September 2014 over security concerns also
points to signiicant doubts over the long term stability and dependability of Pakistan
Until recently, many analysts believed that the close economic and political relationship
between China and the Myanmar military regime may also be translated into a de facto
alliance23 he relationship has been close since Myanmar’s international isolation ater
its 1988 military takeover coincided with China’s isolation following the 1989 Tianaman
Square incident In the 1990s, Chinese companies were involved in the development or
upgrading of ports in Myanmar and a signals intelligence facility in the Bay of Bengal But
Myanmar has never publicly allowed China to use its military facilities While the regime
was happy to accept Chinese arms and investment it did not strategically subordinate itself
to Beijing24 Beginning in 2011, Myanmar has partly distanced itself from China he cancellation of several Chinese sponsored projects, including the huge Myitsone dam project,
may have shaken Chinese trust in Myanmar as a partner25 Myanmar’s political opening
towards the United States and India and the partial liberalisation of its political system have
also reduced China’s inluence in the country and may represent a signiicant set-back for
China in the region Beijing may now have signiicant doubts about Myanmar as a dependable long-term security partner in the Indian Ocean
More recently, China appears to have targeted Sri Lanka as a key strategic partner in the
Indian Ocean and perhaps also as a security partner In recent years there has been signiicant Chinese investment into Sri Lanka, much of it into high proile infrastructure projects
such as highways and ports he Sri Lankan government has been keen to cultivate Beijing
as an economic partner and as a diplomatic partner to help fend of international pressure
over human rights issues Since mid-2014, there have also been increasing indications of Sri
Lanka’s willingness to host Chinese military-related facilities Although, until now, China
had no role in the operation of Hambantota port, it was recently announced that China
will take over management of a new and enlarged Phase II development of the port, which
will include berths dedicated for Chinese use It was also revealed in July 2014 that the government was proposing to establish a Chinese-run facility near the port of Trincomalee,
ostensibly to support maintenance support for Sri Lanka’s Air Force Ater strong protests
from Delhi, this facility may be moved to another location, perhaps near Hambantota port
his could ultimately form the basis of a PLA Air Force presence But it is not yet clear
to what extent these arrangements will involve an overt Chinese military presence in Sri
Lanka he development of an overt presence would have a signiicant impact on security
dynamics in the Bay of Bengal, particularly the Indo-Sri Lankan relationship, but may have
only a relatively small impact on China’s strategic vulnerability in the Indian Ocean region
STIMSON CENTER | 77
The Changing Balance of Power in the Indian Ocean: Prospects for a Significant Chinese Naval Presence
Conclusion
China sufers from some fundamental strategic vulnerabilities in the Indian Ocean and
its ability to mitigate those vulnerabilities is limited Due to a combination of geographic
factors, limited capabilities, and other more immediate priorities, for the foreseeable future
China is likely to have only a very limited ability to project military power into the Indian
Ocean hese will only be partly mitigated through the development of overland transport
links and increased access to port facilities
China’s strategic disadvantages in the Indian Ocean are reinforced by the strategic alignments of the Indian Ocean states, which tend towards the United States and/or India
China’s economic inluence in the region is growing, but this is not automatically translating into security partnerships Although Pakistan is a long-time ally, its stability is increasingly doubtful Myanmar’s dependability as a long term security partner is also under
question In recent times, China has made progress in cultivating a security relationship
with Sri Lanka, but it is not yet clear to what extent Sri Lanka would be prepared to host a
Chinese military presence
While China would be expected to continue to work to mitigate its strategic disadvantages, it seems unlikely in the foreseeable future that it would be in a position to protect the
entirety of its sea lines of communication in the Indian Ocean his may imply that China
will act relatively cautiously in the Indian Ocean for some years While Beijing may seek to
use the possibility of a substantial naval presence for strategic leverage it would make more
sense for it to focus its naval resources in East Asia and only develop a signiicant naval
presence in the Indian Ocean in response to speciic threats
About the Author
David Brewster is a Visiting Fellow with the Strategic and Defence Studies Centre,
Australian National University, a Fellow with the Australia India Institute and Senior
Maritime Security Fellow with the Indian Council on Global Relations Dr Brewster has
written extensively on India’s security relationships throughout the Asia Paciic and the
Indian Ocean region His books include India as an Asia Paciic Power which explores
India’s growing security relationships and ambitions in the Asia Paciic His most recent
book, India’s Ocean: the Story of India’s Bid for Regional Leadership, examines India’s strategic aspirations and relationships in the Indian Ocean region He is the author of numerous
academic articles on Indian and Indian Ocean security afairs in international journals
including Asian Security, Paciic Review, India Review, Contemporary South Asia, Journal
of Strategic Studies, Asian Survey, Security Challenges, Australian Journal of International
Afairs, and Journal of the Indian Ocean Region He was one of the principal authors of he
Indian Ocean Region: Security, Stability and Sustainability in the 21st Century, which analysed the security environment in the Indian Ocean and proposed strategies for dealing
with the changing balance of power in the region He is also the author of a recent report
by the Indian Council on Global Relations titled he India-Australia Security Engagement:
Opportunities and Challenges his explores Indian and Australian perspectives on Indian
Ocean security and provides policy recommendations for greater security engagement
between those countries
78 | SEA CHANGE
David Brewster
Notes
1 US Department of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China (Washington, DC: Oice of the Secretary of Defense, 2012), p42.
2 Ian Storey, “China’s Malacca Dilemma,” Jamestown Foundation China Brief, Vol 6, No 8 (12 April 2006)
3 Indian Navy, Freedom to Use the Seas: India’s Maritime Military Strategy (New Delhi: Integrated
Headquarters, Ministry of Defence, 2007), p59
4 James R Holmes, “Inside, Outside: India’s ‘Exterior Lines’ in the South China Sea,” Strategic Analysis,
Vol36, No3 (2012), pp358-363
5 “China Afraid of India’s Naval Presence in the Ocean,” Zeenews.com, 13 August 2009
6 John Garver, Protracted Contest: Sino-Indian Rivalry in the Twentieth Century (Seattle: University of
Washington Press, 2001), p277
7 David Brewster, India’s Ocean: he Story of India’s Bid for Regional Leadership (London: Routledge, 2014)
8 US Congressional Research Service, China Naval Modernization: Implications for U.S. Navy
Capabilities—Background and Issues for Congress, 5 August 2014
9 Rory Medcalf, “China Makes Statement as it Sends Naval Ships of Australia’s Maritime Approaches,”
Lowy’s he Interpreter, 7 February 2014, at http://wwwlowyinterpreterorg/post/2014/02/07/China-makesstatement-as-it-sends-naval-ships-of-Australias-maritime-approachesaspx
10 See, for example, Ramtanu Maitra, “India Bids to Rule the Waves,” Asia Times, 19 October 2005; Sudha
Ramachandran, “China Moves into India’s Back Yard,” Asia Times, 13 March 2007
11 Daniel J Kostecka, “he Chinese Navy’s Emerging Support Network in the Indian Ocean,” China Brief,
Vol10, No15 (22 July 2010), pp3-5; James R Holmes and Toshi Yoshihara, “China’s Naval Ambitions in the
Indian Ocean,” Journal of Strategic Studies, Vol 31, No3 (2008), pp379-80
12 “Djibouti: China Planning Military Base, Increased Cooperation,” Africa Armed Forces, 28 March 2014,
at http://wwwaafonlinecoza/news/djibouti-china-planning-military-base-increased-co-operation
13 Peter Drysdale, “China’s Reach in the Indian Ocean,” East Asia Forum, 25 March 2013, at http://www
eastasiaforumorg/2013/03/25/chinas-reach-in-the-indian-ocean/
14 “China Has No Plan for Indian Ocean Military Bases,” he Hindu, 4 September 2012
15 S Kasahara, “he Flying Geese Paradigm: A Critical study of Its Application to East Asian Regional
Development,” United Nations Conference on Trade and Development, Discussion Paper # 169, April 2004
16 Bo Kong, “he Geopolitics of the Myanmar-China Oil and Gas Pipelines,” in Mikkal E Herberg, ed,
Pipeline Politics in Asia: Energy Nationalism and Energy Markets, NBR Special Report No2, September 2010
17 Yun Sun, “China, Myanmar: Stop that Train,” Asia Times, 14 August 2014
18 CRaja Mohan, “Kashgar Corridor,” Indian Express, 10 July 2013
19 Liu Jinxen, “China’s Bridgehead Strategy and Yunnan Province,” East by Southeast, 16 November 2013,
at http://wwweastbysoutheastcom/chinas-bridgehead-strategy-yunnan-province
20 Selig Harrison, “China’s Discreet Hold on Pakistan’s Northern Borderlands,” New York Times, 26
August 2010 Note: Chinese troops likely numbered in the hundreds and not the thousands as reported.
21 Andrew S Erickson and Gabriel BCollins, “China’s Oil Security Pipe Dream,” Naval War College
Review, Vol63, No2 (2010), pp 91-2
22 Urmila Venugopalan, “Pakistan’s Black Pearl,” Foreign Policy, 3 June 2011
23 See, for example, Mohan Malik, China and India: Great Power Rivals (Boulder: FirstForumPress, 2011)
24 hant Myint-U, Where China Meets India: Burma and the New Crossroads of Asia (London: Faber and
Faber, 2011)
25 Yun Sun, “China’s Strategic Misjudgement in Myanmar,” Journal of Current Southeast Asian Afairs,
Vol31, No1 (2012), pp73-96
STIMSON CENTER | 79
The Changing Balance of Power in the Indian Ocean: Prospects for a Significant Chinese Naval Presence
80 | SEA CHANGE
Energy Exploration, Exploitation,
and Exports in the Indo-Pacific Region
Dan Millison
Introduction
here are more than one billion people in the world today who do not have access to grid-supplied electricity, other commercial energy services, safe drinking water, and basic sanitation
Most of these people are in the Indo-Paciic region including East Africa, South Asia, and
Southeast Asia Commercial energy services for this “bottom billion” are a prerequisite for
inclusive growth and social and political stability with obvious geopolitical implications
Supply Chain Dynamics: Rate-limiting Factors and Choke Points
As the global economic center of gravity shits to Asia, and more speciically to Asia’s cities,
a critical constraint on more equitable socio-economic development is not total resource
availability, but rather the resource supply chains, especially in the “last mile,” including
poor consumers at the bottom of the economic pyramid he bandwidth of intermodal
trans-shipment capacity and last-mile connectivity is critical because strategic resources are
not evenly distributed, and commodities and consumer goods have to move from coastal
ports into cities and the hinterlands and vice versa he major choke points for maritime
traic in the Indo-Paciic region are well-known he Strait of Hormuz and the Strait of
Malacca are strategic conduits for crude oil and liqueied natural gas (LNG) shipments
he Strait of Aden and the Suez Canal are critical links between the Indian Ocean and
the Mediterranean Sea, connecting Asia and Europe In addition to these choke points,
rate-limiting factors in energy supply chains are petroleum reining capacity,1 competition
for water use in energy and agriculture, and resource utilization eiciency
Energy Supply Outlook
Today’s global energy supply outlook is robust, largely due to development of non-conventional hydrocarbon resources in the United States, new oil and gas discoveries in the
western Indian Ocean basin and East Africa, abundant coal resources in the Indo-Paciic
region and the United States, improvements in energy eiciency (including vehicle leet eiciency), and slower than expected recovery from the global inancial and economic crisis of
2008 According to data from the US Energy Information Agency (EIA), the United States
was the world’s largest combined oil and gas producer in 2012 and 2013, with Russia a close
second2 New crude oil and natural gas production is coming online in East Africa and
Mozambique, complementing the rapid growth in US hydrocarbon production In the next
two to three years, new LNG supplies will be coming online from Australia, Mozambique,
and Papua New Guinea, which are mostly committed to China Energy resources in the
ground are abundant, but metabolizing these resources in the developing economies of
the Indo-Paciic is a greater challenge than meets the eye With respect to energy security,
speciically hydrocarbon supplies, the big South Asian consumers—Bangladesh, India,
and Pakistan—are efectively “islands” with no cross-border pipeline connections to major
producing countries In these three countries, demand for oil and gas, reined petroleum
products, and coal has to be covered in part by imports
STIMSON CENTER | 81
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
With respect to total hydrocarbon lows, the greater region comprised of member states of the
Association of Southeast Asian Nations (ASEAN) is as important as, or more important than,
the Strait of Hormuz, with about one-third of global crude oil and one-half of LNG shipments
transiting the Strait of Malacca and South China Sea every day In this context, China has
made strategic investments to reduce its vulnerability to these maritime choke points, mainly
in the form of oil and gas pipelines and port infrastructure in the Indian Ocean (Figure 1)
China has developed pipeline connections to import oil and natural gas from Kazakhstan,
and natural gas from Myanmar In May 2014, Gazprom and China National Petroleum
Corporation signed an agreement to develop the “Power of Siberia” pipeline to bring natural
gas from Eastern Siberia to Northeastern China According to Stratfor’s Geopolitical Diary
of March 26, 2013, these oil and gas pipelines are “largely immune to any potential US maritime interdiction”; the so-called “string of pearls” does not refer to naval bases but to port
infrastructure intended to “maintain control over all aspects of its overseas supply chains”3
here is substantial potential in mature hydrocarbon provinces waiting to be developed in
South and Southeast Asia,4 but major bottlenecks exist in the form of unfavorable terms
and conditions for exploration licenses and production sharing contracts for oil and gas,
and natural gas pricing policies which for example have resulted in stranded gas ofshore Bangladesh and Vietnam In addition, maritime territorial disputes have hampered
Figure 1. Choke Points, Strategic Pipelines, and China’s String of Pearls
Source: Dan Millison, “What Will Travel on the Marine Silk Road: Energy, Food, and Consumer Goods” (paper presented for panel titled “Indian Ocean Basin: 21st Century Challenges” at hird Biennial Critchield Conference, College of
William and Mary, Williamsburg, VA, April 2013)
82 | SEA CHANGE
Dan Millison
exploration and development of some ofshore resources Earlier this year, a Chinese-owned
drillship conducted drilling near the Paracel Islands in waters claimed by Vietnam; test
results were not made public, but developing any commercial reserves would be complicated by overlapping territorial claims By way of example, the Sampaguita Field near Reed
Bank of of Palawan was discovered in 1976, with initial natural gas reserve estimates of
3-5 trillion cubic feet (TCF) Seismic surveys completed in 2006 indicated that reserves may
be as high as 20 TCF5 he Sampaguita Field is in waters claimed by the Philippines, but
further development has been delayed due to competing Chinese claims on the area6 As
of May 2014, Forum Energy Plc and China National Ofshore Oil Corporation (CNOOC)
were in discussions for further exploration and development of the ield, which presents an
opportunity for a commercial deal that may lead to “cocktail diplomacy”7
here is signiicant wind potential ofshore of the Indian states of Kerala, Gujarat, Karnataka,
and Goa, which are host to a mature on-shore wind power business Technical potential is
estimated at up to 500,000 megawatts (MW), but commercial potential remains to be determined Gujarat is also host to the some of the world’s largest tidal energy potential, which
is co-located with some of India’s best ofshore wind prospects As of October 2014, two
utility-scale wind projects ofshore Gujarat were announced: India’s Ministry of New and
Renewable Energy (MNRE) signed a memorandum of understanding with a consortium
of major public sector utilities to develop a 100 MW project, and Suzlon, the world’s ith
largest supplier of wind turbines, announced its interest in developing a 300 MW project
Looking farther into the future of unconventional hydrocarbon prospects, methane hydrates have been detected in various locations in the region, and are noteworthy as in early
2013 a Japanese research ship conducted a short-term production test in the Nankai Trough,
suggesting that these resources may have a commercial future he presence of methane
hydrates below sea water depths of 350 meters has been known for decades, and the United
States Geological Survey estimates that potential resources are ten to one hundred times
larger than US shale gas resources Although commercial exploitation at scale is far from
a certainty, in 2013 the executive director of the International Energy Agency noted that
“shale gas was in the same position 10 years ago We cannot rule out that new revolutions
may take place through technological developments”8
Coal Use Scenarios
he conventional and unconventional resources are mid- to long-term prospects with at
least ive- or ten-year development lead times, so in the near-term most countries in South
and Southeast Asia are focused on expanding coal-ired electricity supplies Most of the developing countries in Asia have been pursuing coal expansion strategies that are intended to
bring the cost of supply below retail tarifs, with meager results (eg, India and Indonesia)
Coal appears to be a least-cost solution with a hypothetical wholesale cost of around $005–
006 per kilowatt-hour (kWh) versus typical retail tarifs of $006–009 per kWh9 Coal is
not without its own challenges, one of which is that most of the coal to support new power
generation capacity will have to be imported—hence it is the third form of “ofshore energy”
hree scenarios for coal-ired power through 2030 illustrate these challenges; in each scenario, China and India dominate the outlook for coal-ired power capacity
STIMSON CENTER | 83
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
Scenario 1: Business as Usual
A business-as-usual scenario for developing countries in Asia prepared in 2011 projected an additional 700 gigawatts (GW) of new coal-ired power capacity to be installed by
2030 (Figure 2) his new capacity would require an additional 2 billion tons per year (t/y)
of steam coal by the year 2030, most of which would have to be imported, on top of total
global steam coal exports of about 1 billion t/y in 2012 his additional 2 billion t/y is a 207
percent increase over total global steam coal exports in 201210 Assuming a typical Panamax
collier with 60,000–70,000 tons per load, 2 billion tons per year translates to at least 23,000
additional shiploads per year, or 63 shiploads per day, mostly at ports in China and India11
here is plenty of coal that can be loaded onto ships, but not all of the countries in the IndoPaciic region have the port and trans-shipment capacity to metabolize a major increase in coal
imports, especially in the near term his is most pronounced in India: the current ive-year
plan period envisioned more than 60 GW of new coal-ired capacity coming on line, but up to
45 GW of this may be at risk due to limited intermodal trans-shipment capacity at Indian ports
As of 2012, Peabody Energy had a mixed outlook on the supply and intermodal trans-shipment
constraints, anticipating roughly 400–450 million t/y new supplies coming online by year-end
2016, 12 but noting bottlenecks in steam coal production, trans-shipment, and consumption due
to rail and port capacity constraints In late 2013, Stratfor noted the lack of signiicant spare delivery capacity in the near term and potential impact on imports to China:
Figure 2. Coal Scenario #1
Coal consumption for business-as-usual is based on 400 tons per gigawatt-hour Peoples Republic of China eestimate
assumes 3percent annual growth in installed coal-ired capacity; actual additions may be much higher but will be ofset by
retirement of obsolete plants India estimates from World Bank 2010 Unleashing Renewable Energy Potential in India
Estimates for Indonesia, hailand, Kazakhstan, Vietnam, and Philippines are derived from Clean Technology Fund
Investment Plans which are available on-line at wwwclimateinvestmentfundsorg Pakistan estimates from Pakistan
Energy Security Plan 2005 (Source: Millison, “What Will Travel on the Marine Silk Road”)
84 | SEA CHANGE
Dan Millison
It would be extremely diicult for the global coal market, which measured a little over
1 billion tons in 2012, to accommodate another 10 percent rise in coastal coal import
demand In short, even without political and social pressure to reduce coal consumption
on the coast, there are structural incentives for these provinces to seek alternative power
generation sources in the next seven to 10 years13
Indonesia has been the world’s biggest steam coal exporter for the last several years, but its
exports are projected to level of ater 2011 and decline for the foreseeable future14 Australia
has the potential to export about one billion tons per year, but this would require new investment in mine-to-port trans-shipment capacity15 he US currently has a coal surplus,
with exports in 2013 of about 65 million tons of metallurgical coal and just over 50 million
tons of steam coal here may be additional surplus capacity of as much as 170 million tons
per year from the Powder River Basin in Wyoming and Montana, which has a signiicant
price advantage at the point of loading and may have a delivered price advantage over
Australian and Indonesian steam coal depending on the destination: free-on-board cash
costs of Australian and Indonesian coal were just over $70 per ton and $60 per ton respectively,16 compared with well under $50 per ton for Powder River basin coal17
Scenario 2: EE + RE < C
he second scenario assumes that a broad spectrum of energy eiciency (EE) gains and
renewable energy (RE) is developed, achieving cost parity with coal (C) or at least the grid
Figure 3. Coal Scenario #2
BAU scenario is the same as in Figure 2, with coal consumption at 400 tons per gigawatt-hour Consumption for EE+RE<C
is assumes coal consumption improves to 300 tons per gigawatt-hour Reduced coal demand for EE+RE<C is based on references noted at Figure 2, except for China which is based on published estimates for RE output totaling 138 terawatt-hours
per year (Source: Millison, “What Will Travel on the Marine Silk Road” )
STIMSON CENTER | 85
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
mix by 2030 In this scenario there will still be demand growth for about another 1 billion
t/y steam coal by 2030; this is around a 100 percent increase on top of 2012 global exports
(Figure 3)18 About half of this extra one billion tons per year may be online within the
next couple of years,19 with another half a billion tons per year likely to be available from
Australia, China, Mongolia, Mozambique, and the United States
his “EE+RE<C” scenario is emerging in India and Indonesia where fast-track coal-ired
power initiatives launched in 2006 have fallen well short of the mark, with new eiciency
and renewable energy programs starting to take up the slack It is not obvious that the developing countries listed in these three scenarios can metabolize an additional 1 billion t/y
of coal In the case of India, RE is rapidly approaching parity with the cost of electricity
using imported coal, the landed cost of which is about twice that of domestic coal (see notes
on coal price spreads below) In Indonesia, the average cost of electricity supply is about
$020 per kWh, which is higher than every form of commercially available RE kit today20
Scenario 3: Xinjiang 2020
China may cap coal consumption at 4 billion t/y (there appears to be a de facto cap already)21
Coal production in Xinjiang is projected to increase by as much as 600 million t/y by
the end of this decade,22 which, combined with a cap on domestic consumption, would
eliminate coal imports by 2020 At least one market-watcher notes that China has increased coal imports mainly due to price considerations rather than reserve and production
Figure 4. Coal Scenario #3
he EE+RE<C scenario is the same as Figure 3 Assumptions: (a) US coal exports increase by 170 million tons/year; (b) All
proposed LNG export proposals in Canada and the US proceed, with a total of 1138 trillion cubic feet of gas per year; this
is equivalent to 476 million tons of coal per year assuming 2510 gigajoules (GJ) per ton coal and 105 megajoules (MJ) per
cubic foot of gas (Source: Millison, “What Will Travel on the Marine Silk Road” )
86 | SEA CHANGE
Dan Millison
constraints23 If domestic coal consumption is capped, China will have to make an aggressive shit to natural gas, with new pipeline gas from Russia (based on agreements reached
in May and November 2014), expanded pipeline gas supplies from Central Asia (underway),
and possibly additional LNG from North America and other suppliers post-2016 (subject
to US policy whims and permitting decisions) In this scenario, North American energy
exports could theoretically cover residual demand (equivalent to about 500 million t/y of
coal), mostly in India, assuming that additional import terminals and related infrastructure
could absorb a surge in coal and LNG imports
The Role of North American Energy Exports in the Indo-Pacific Region
In the three scenarios discussed above, Canada and the United States will play an important role with respect to increased exports of coal, crude oil and reined products, and LNG
As noted above, US steam coal exports are currently around 50 million tons per year, with
additional production to spare in the Powder River basin As shown in Figure 4, the various
LNG export projects in the development queue have a combined volume of 1138 TCF of
gas per year, equivalent to about 476 tons of coal per year Energy price spreads, as of early
2014, have caused quite a bit of excitement in Canada and the United States he potential
margins of exports of Powder River basin coal appear to be as high as $75 per ton, and the
potential margin for LNG exports based on Henry Hub prices appears to be on the order
of $10 per million British thermal units (MMBTU)24 hese potential margins are being
realized for some coal exports, but have yet to be monetized at the scale for LNG
As long as economic growth in the Indo-Paciic region is maintained, the United States
and Canada are likely to be winners in the global energy trade for the foreseeable future
here are no major regulatory controls on US coal exports In contrast, US LNG exports
are subject to policy and regulatory hurdles, and only a handful of new LNG export projects may materialize
Discussion Points
he foregoing scenarios are not presented as robust forecasts, and are subject to change due
to unforeseen and improbable events, or so-called “black swans”25 In the near term, three
major activities have a signiicant bearing on the global energy outlook through year 2030:
• Successful transition of China’s economy from being export oriented to domestic
consumption oriented
• Re-invigoration and restructuring of India’s economy
• Disintermediation of traditional power utilities and transport sector due to rapid
decline in costs of solar photovoltaics (PV), energy storage, and electric vehicles
In the global coal supply chain, China is the proverbial eight hundred-pound gorilla (India
is its four hundred-pound cousin), and in the context of global energy trade, what happens
in China does not stay in China China has been driving global commodity demand for the
past ten years, but has entered a very diicult transition period Already, China has lost its
low-cost labor advantage: its demographic dividend has been spent; simply stated, China
has grown old before growing rich26 If it succeeds in retooling its economy from being
export oriented to being domestic consumption oriented in a timely manner, China will
become “a Singapore on steroids”27 and that success story will make the reforms of the last
STIMSON CENTER | 87
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
thirty-ive years look insigniicant A successful economic transformation will require aggressive action on air pollution control, which, in turn, will require capping domestic coal
consumption and using natural gas and renewable energy in place of coal: in this scenario,
China would conceivably consume all of the surplus gas in the world via pipelines and LNG
imports he shit from coal to gas is already evident via the agreement for the “Power of
Siberia” pipeline, signed in May 2014, and a second agreement for additional gas supplies
signed in early November 201428
If China’s economic transition is not successful, it is likely to experience long-term stagnation (or worse) for the foreseeable future;29 in that instance, forecasts for global commodity
demand to the year 2030 should be considered highly suspect According to recent analysis
by Stratfor, there are sixteen developing countries which are well-suited to succeed China
as the world’s low-cost, export-oriented economic hubs Twelve of these sixteen countries
are in East Africa, South Asia, and Southeast Asia: Ethiopia, Kenya, Tanzania, and Uganda
in East Africa; and Bangladesh, Cambodia, Indonesia, Laos, Myanmar, the Philippines, Sri
Lanka, and Vietnam, in South and Southeast Asia30
In contrast to China, which is efectively 100 percent electriied, at least one-fourth of
India’s population does not have grid-supplied power—roughly equivalent to the entire
population of the United States—and many grid-connected areas sufer from poor quality
supply and frequent brown-outs Retail energy prices have historically been subsidized, but
there is limited public sector iscal depth to sustain retail price subsidies indeinitely Prime
Minister Modi’s new government is expected to adopt policies that were successful during
his tenure in Gujarat, namely moving the electricity sector to fully commercial operations
while limiting subsidized retail consumption he Modi government has consolidated the
former ministries of coal, new and renewable energy, and power into a single ministry, and
has signaled clear intent to streamline India’s notorious bureaucracy with the theme of “less
government, more governance”
As of late October 2014, India’s Ministry of New and Renewable Energy (MNRE) had
announced the intent to expand and accelerate the solar power program from a goal of
20 GW of grid-connected capacity by 2022 to 100 GW of new capacity by 2020 his expanded target implicitly acknowledges that the BAU scenario shown in Figure 2 is heavily
burdened with fuel supply chain bottlenecks and supply chain risks he BAU scenario
would require expansion of domestic coal and natural gas production, complemented by
expanded coal import terminals and intermodal trans-shipment capacity, LNG terminals,
and gas pipelines, including regional cross-border pipelines Expanding the solar program
to 100 GW indicates that the EE+RE<C scenario shown in Figure 3 is in fact materializing
in India his expanded target will require “new” investment on the order of $10 billion per
year, some of which will be in lieu of investments in fossil power under the BAU scenario
Shiting from BAU to the new 100 GW objective will avoid most of the sunk costs for fuel
supply chain infrastructure, reducing fuel supply chain risks in the process, and likely reducing the growth in future coal demand below that shown in Figures 3 and 431
Against this backdrop, rapid technological and commercial advances in renewable energy—
particularly solar power—are running ahead of policy and regulatory developments, and
causing disintermediation of the conventional electric utility business model he market
88 | SEA CHANGE
Dan Millison
disruption caused by shale energy development, combined with disintermediation in electricity markets, are portents of a broader transformation of the energy business which is
expected to occur by 2030 Solar photo-voltaic (PV) systems are experiencing the fastest
learning rate of any form of renewable energy system and are on their way to becoming
“too cheap to meter” at each end of the energy supply chain, meaning: (i) the wholesale cost
achieves parity with coal, and (ii) the retail price can be delivered without inancial hardship to the consumer he solar PV learning rate is due partly to technological advances
associated with rapid expansion of manufacturing capacity—industrial mass production as
pioneered by Henry Ford—and partly because the pre-paid mobile phone service model is
being adapted and transferred to the electricity business Solar PV is becoming a preferred
choice for of-grid and distributed generation applications, as well as for utility-scale power
PV is upwardly and downwardly scalable and, with reasonable load-following characteristics, is a partial solution for peak generation (peaking capacity being the most expensive
power in the grid mix)
Solar PV and other renewable resources are being developed at suicient scale to have a
visible impact on the traditional electric utility industry Earlier this year, David Crane, the
president and chief executive oicer of NRG Energy, Inc, the largest independent power
producer in the United States, noted that there is an “inexorable trend towards a distributed
generation-centric, disaggregated future featuring individual choice and the empowerment
of the American energy consumer hat this future is going to occur is, in my opinion, inevitable; that it’s going to occur faster than almost every person thinks it’s going to occur is
highly probable”32 In late May 2014, Barclays downgraded bond ratings for the US electric
utility industry, noting that “we believe that a conluence of declining cost trends in distributed solar photovoltaic (PV) power generation and residential-scale power storage is likely
to disrupt the status quo”33
he combination of disruptive energy development and disintermediation of the electric utility industry points to wholesale transformation in global energy development
Paraphrasing David Crane and Barclays on the shit toward RE-based distributed generation, “it’s not if, it’s when” his shit is complemented by new business models to deliver
energy services including “pay as you go” and rootop solar leasing being pioneered by
Simpa, Solar City, and other irms Tesla’s new gigafactory is expected to drive learning rates
for battery storage in the near future, which would result in much more afordable energy
storage to complement distributed solar power infrastructure To some extent, these business models are building a market which is running ahead of regulation Given the dynamic
evolution occurring in energy markets today, forecasting future outcomes with any semblance of accuracy is an extreme challenge, but it does appear that transformation of the
energy sector in the Indo-Paciic region is starting to happen In the absence of robust clairvoyance, we might simply remind ourselves of former Saudi oil minister Sheikh Ahmed
Zaki Yamani’s comment that the “stone age did not end because of a shortage of stones”
STIMSON CENTER | 89
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
About the Author
Dan Millison is the Manager of Transcendergy LLC, a private consultancy established in
2008 to provide sustainable infrastructure solutions He has more than 26 years professional experience with over 14 years of experience in clean energy development, including
support for Asian Development Bank’s (ADB) programs and projects with co-inancing
from the Clean Technology Fund and the Scaling Up Renewable Energy Program He was
formerly a senior energy specialist at ADB, and previously worked in the environmental services and oil and gas industries He holds an MS in Civil Engineering and a BA in
Geological Sciences, both from Northwestern University in Evanston, Illinois
Notes
1 Petroleum reineries are engineered to handle speciic ranges of crude oil For example, when “sweet”
crude oil production in Libya went oline in 2011, additional “sour” output from Saudi Arabia was reined
in the US, resulting in minimal disruptions in supply of reined products
2 Cameron Nelson, “MSR21 Sounding Report #1: he Impact of Indian Ocean Energy Pipeline
Development on the Global Landscape,” (unpublished manuscript, Marine Silk Road 21, LLC,
Williamsburg, VA, 24 February 2014)
3 Stratfor, “Xi Jinping’s Symbolic Overseas Tour,” Stratfor Geopolitical Diary (March 2013), p17, at http://
wwwstratforcom/sample/geopolitical-diary/xi-jinpings-symbolic-overseas-tour his article notes that the
“string of pearls” are not naval bases, but are intended to avoid US maritime interdiction at Indo-Paciic
choke points
4 One of the lessons learned from the US shale energy revolution is that mature hydrocarbon provinces
may yield much higher reserves and production rates than previously thought
5 hese resource estimates are from Forum Energy plc, at http://wwwforumenergyplccom/company/
proileaspx
6 Hong Kong-based media reported that in March 2011 Chinese navy vessels threatened to ram a survey
ship hired by exploration company Philex Petroleum Corporation; Reuters, “Huge Gas Find to Heat Sea
Squabble,” he Standard (Hong Kong), 25 April 2012, at http://wwwthestandardcomhk/news_detail
asp?we_cat=6&art_id=121832&con_type=3
7 As suggested by Dr Hasjim Djalal in his presentation, “Maritime Geo-Politics in the Indo-Paciic,
Strategic Perspectives: Indonesian Perspectives,” delivered at the Maritime Trade and Security Conference
“Sea Change: Evolving Maritime Geopolitics in the Indo-Paciic Region,” co-hosted by the Stimson Center
of the United States and the Observer Research Foundation of India in June 2014
8 Sylvia Pfeifer, “Methane Hydrates Could Be Energy of the Future,” Financial Times, 17 February 2014, at
http://wwwtcom/intl/cms/s/2/8925cbb4-7157-11e3-8f92-00144feabdc0html#axzz3JWeZlwrG
9 With retail electricity tarifs around $025/kWh, the Philippines is an exception among developing countries in the Indo-Paciic region
10 World Coal Association, Coal Facts 2013 (London, United Kingdom: World Coal Association, 2013), p2,
at http://wwwworldcoalorg/bin/pdf/original_pdf_ile/coal_facts_2013(11_09_2013)pdf
11 New LNG export capacity from Australia and Papua New Guinea are committed to China and this is
built-in to the BAU and EE+RE<C scenarios
12 Gregory H Boyce, 2012 Analyst and Investor Forum: Creating Value for Both Near Term and Long
Term (St Louis, MO: Peabody Energy, 2012), at http://wwwpeabodyenergycom/mm/iles/Investors/IR%20
Presentations/10%20Greg%20Boyce%20Summary%20and%20Key%20Takeawayspdf
13 Stratfor, ”China Strives to Clean Up Pollution” Stratfor Analysis (October 2013), p14, at http://www
stratforcom/sample/analysis/china-strives-clean-pollution his article notes Chinese government intent
to cap domestic coal consumption at 4 billion tons per year, and further notes that there is limited global
export-import capacity to support a rapid increase above 1 billion tons per year
90 | SEA CHANGE
Dan Millison
14 International Energy Agency, Southeast Asia Energy Outlook: World Energy Outlook Special
Report (Paris, France: IEA, 2013), at http://wwwieaorg/publications/freepublications/publication/
southeastasiaenergyoutlook_weo2013specialreportpdf Note: Figure 38 shows projected Indonesian coal
production and share of net exports from 1990 through 2035 Figure 37 shows free-on-board prices for
steam coal exporters in 2012
15 Ailun Yang and Yiyun Cui, “Global Coal Risk Assessment: Data Analysis and Market Research,”
working paper (Washington, DC: World Resources Institute, November 2012), at http://wwwwriorg/sites/
default/iles/pdf/global_coal_risk_assessmentpdf
16 IEA, Southeast Asia Energy Outlook: World Energy Outlook Special Report
17 Mark hurber, “Exporting Coal from the US Paciic Northwest: Potential Impacts of Removing an
Energy Transportation Constraint,” working paper, National Bureau of Asian Research (NBR), 2014 Paciic
Energy Forum Working Papers, Seattle, WA, April 2014, at http://wwwnbrorg/downloads/pdfs/ETA/
PEF_2014_workingpaper_hurberpdf
18 World Coal Association, Coal Facts 2013 he coal consumption estimates presented in this scenario
were prepared independently of, but are consistent with, global electric power capacity additions projected
from 2010 through 2030 presented by Michael Liebreich in his “State of the Industry” keynote address at the
2014 Bloomberg New Energy Finance Summit; Michael Liebreich, “State of the Industry,” (Keynote address,
Bloomberg New Energy Finance Summit, New York, NY, 15 April 2014), at http://aboutbnefcom/video/
summit-2014-michael-liebreich/
19 Boyce, 2012 Analyst and Investor Forum.
20 Asian Development Bank, Risk Assessment Report and Risk Management Plan for Indonesia Energy
Sector, ADB TA 7277-REG: Governance and Capacity Development Initiative (Phase 2) [Conidential document] (Manila: Asian Development Bank, 2010) For the costs of RE systems, see International Renewable
Energy Agency, Renewable Power Generation Costs in 2012: An Overview (Abu Dhabi: IRENA, 2012)
21 Some US observers have noted publicly that air pollution in China is so bad that it threatens government
stability US Ambassador to China Max Baucus was quoted to this efect in a recent article by Jef Goodell in
Rolling Stone See Jef Goodell, “China, the Climate and the Fate of the Planet,” Rolling Stone, 15 September
2014, at http://wwwrollingstonecom/politics/news/china-the-climate-and-the-fate-of-the-planet-20140915
In a panel presentation at the Woodrow Wilson International Center for Scholars in Washington, DC,
Amy Myers Jafe said that air pollution in China was so bad that “it could bring down the government”
See Amy Myers Jafe, “Platforms, Pipelines & Policies: Energy & Security in China and Asia Paciic,”
speech presented at Woodrow Wilson International Center for Scholars, Washington, DC, 17 September
2014, video ile, Kissinger Institute for China and the United States, at http://wwwwilsoncenterorg/event/
platforms-pipelines-policies-energy-security-china-and-asia-paciic
22 Stratfor, “China’s Ambitions in Xinjiang and Central Asia, Part 2,” Strafor Analysis (October 2013), p15,
at http://wwwstratforcom/sample/analysis/chinas-ambitions-xinjiang-and-central-asia-part-2 his article
notes that coal production in Xinjiang is expected to increase from 141 million tons per year to 750 million
tons per year by 2020, a 600 million ton per year increase
23 David Gambrel, “China Ship Congestion—How So Many Capesize Ships Got Locked Out of China’s
Ports,” Coal Age, 12 September 2012, at http://wwwcoalagecom/indexphp/departments/transportation-tips/2232-china-ship-congestionhow-so-many-capesize-ships-got-locked-out-of-chinas-portshtml#
VGy_D_nF_Xw
24 hurber, “Exporting Coal,” p4
25 Nassim Nicholas Taleb, he Black Swan: he Impact of the Highly Improbable, 2nd ed (New York:
Random House, 2010); Nassim Nicholas Taleb, Antifragile: hings hat Gain from Disorder (New York:
Random House, 2012)
26 George Friedman, he Next 100 Years: A Forecast for the 21st Century (New York: Doubleday, 2009)
27 Elizabeth C Economy, “China’s Imperial President: Xi Jinping Tightens His Grip,” Foreign Afairs
(November/December 2014), at http://wwwforeignafairscom/articles/142201/elizabeth-c-economy/
chinas-imperial-president
STIMSON CENTER | 91
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
28 his agreement is indirectly related to the rapid growth in unconventional gas reserves in the US, where
gas is replacing coal US steam coal exports increased from around 20 million t/y in 2009 to around 50
million t/y in 2012, much of which is displacing natural gas in Europe, including gas from Russia
29 Friedman, he Next 100 Years.
30 George Friedman, “he PC16: Identifying China’s Successors,” Geopolitical Weekly, Stratfor, 30 July
2013, at http://wwwstratforcom/weekly/pc16-identifying-chinas-successors#axzz3JWxVBaMK
31 he BAU and EE+RE<C scenarios are derived from an unpublished manuscript prepared for Asian
Development Bank in 2011 he projections are consistent with global electric power capacity additions
projected from 2010 to 2030 presented by Michael Liebreich in his “State of the Industry” keynote address
at Bloomberg New Energy Finance forum, April 2014, available online at: http://aboutbnefcom/video/
summit-2014-michael-liebreich/
32 NRG Energy Inc, “NRG Energy’s CEO Discusses Q4 2013 Results - Earnings
Call Transcript,” Seeking Alpha, 28 February 2014, http://seekingalphacom/
article/2059563-nrg-energys-ceo-discusses-q4-2013-results-earnings-call-transcript
33 Michael Aneiro, “Barclays Downgrades Electric Utility Bonds, Sees Viable Solar
Competition,” Barron’s, 23 May 2014, at http://blogsbarronscom/incomeinvesting/2014/05/23/
barclays-downgrades-electric-utility-bonds-sees-viable-solar-competition/
92 | SEA CHANGE
Energy Exploration, Exploitation, and Exports in the Indo-Pacific Region
94 | SEA CHANGE
Shipping Developments and Challenges
in the Indo-Pacific Maritime Realm
Rupert Herbert-Burns
Introduction
Amidst the context of steady economic growth of the rising Asian powers of India and
China, the surge in endemic growth of Sub-Saharan Africa, the inescapable strategic imperative of the petroleum sources of the Persian Gulf and Arabian Peninsula and the challenges of geopolitical contest in the South China Sea, there is arguably no more important
or complex geo-economic or geo-strategic maritime canvas on Earth than the Indo-Paciic
Indeed, perhaps what is more compelling is that the extent to which the geo-strategic and
geo-economic importance of the Indo-Paciic region has yet to evolve as we advance further
into the 21st century his evolution has applicability for all: state leaders; policy-makers;
scientists; leaders of industry, commerce, and inance; businessmen; senior military oicers;
academics; ships’ masters and crews; and ishermen
Across the vast distances and variances of the physical and human geographies of the IndoPaciic Maritime Realm, in addition to the cybersphere, the most critical means of geo-economic linkage, if paradoxically unsighted for most, remain the ports, terminals, vessels and
sea lines of communication he aim of this paper is to provide a concise capture of the
status, developments and challenges facing the international shipping industry within the
Indo-Paciic maritime realm
Following a strategic-level overview that provides the geographical and geopolitical canvas
for the subject matter, the essay will comprise the following sections: A capture of the state
of maritime commerce in the region with macro trade statistics and market segment news; a
review of the major trades in the region including dry bulk, containerised trade, petroleum
sector shipping (crude, products and bulk gases); an appraisal of the trade through-put and
dynamics of the major container ports, critical oil and gas terminals, and strategic reining
hubs; and, lastly, a snapshot of the state of shipbuilding in the region
Strategic overview
From a strategic-level trading perspective, the Indo-Paciic maritime realm stretches from
the southern exit of the Suez Canal to Hokkaido in Japan, and from Cape Aghulas to the
Bass Strait Within this expanse, are the world’s largest container ports, crude oil loading
terminals and commercial anchorages, the busiest East-West-East sea lines of communication, and the most strategically vital chokepoints and oceanic inter-connector—the Phillips
Channel of Singapore In terms of the scale of trade dependent population, the volume and
tonnage of trade exchanged, the numbers of vessels in motion, the share of the world’s mega
ports and terminals, there is no more important maritime space on Earth To echo Henry
Kissinger in his address to the International Institute of Strategic Studies—“he center of
gravity of world afairs has let the Atlantic and moved to the Paciic and Indian Oceans”
STIMSON CENTER | 95
Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
Figure 1. Global map of human impact on marine ecosystems
Source: Grolltech [User] via Wikimedia Commons derived from Benjamin S Halpern, et al, “A Global Map of Human
Impact on Marine Ecosystems,” Science 319 (2008): 948-952, http://dxdoiorg/101126/science1149345
he powerful illustration in Figure 1 reveals the relative location and separation of the key maritime trading nodes and the sea lines of communication (SLOC) that link them While the synapses within the Atlantic Basin and the container strings across the Paciic are well established
and immediately obvious, the level of concentration of shipping traic along the East-West-East
maritime trade belt linking Asia and Europe is unmatched anywhere else in the world (indicated
in yellow) Indeed, it is the extent, density and routing of these SLOC that link key ports, terminals and chokepoints across the Indo-Paciic that characterize the maritime geopolitics of this
maritime space, and also give rise to the key maritime security issues confronting the region,
including traicking, piracy and armed robbery at sea and the threat of maritime terrorism
Industry news trade volumes & statistics
Indo-Paciic maritime transport is facing complex challenges, most notably: energy security
and bunker costs, costs and regulations associated with climate change and environmental
protection (with the latter in particular continuing to rank high on the policy agenda of
shipping and port executives); overcapacity and luxing freight rates; and, for the some in
the containerised sector—onerous corporate debt
Nevertheless, in a world oten judged and measured in empiricism, this is the state of play:
Global seaborne trade grows gradually but remains vulnerable to downside macro-economic risks As always, one cannot judge and forecast the health of the international shipping
sector without assessing the state of the global economy and the traditional engines of industrial and output growth, in particular China
Overall, weaker demand for Chinese manufactured exports, especially in Europe and to a
lesser extent the United States, coupled with a decline in Foreign Direct Investment (FDI)
growth in mainland China has dampened the country’s overall output growth Growth
in China’s GDP slowed from 93% in 2011 to 78% in 2012,1 the lowest rate in more than a
96 | SEA CHANGE
Rupert Herbert-Burns
Figure 2. Macro GDP and trade activity correlations
350
World
merchandise
trade
300
250
World
seaborne
trade
200
World GDP
150
OECD
Industrial
Production
Index
100
50
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1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Source: UNCTAD, Review of Maritime Transport, 4
decade In 2014, analysts are indicating that China may be turning the corner towards an
upward curve in growth with GDP targeted to reach 75% hough not a signiicant value,
considering the stellar overall growth during the last decade, it is a move in the right direction Furthermore, this is good news for the shipping industry, which has been waiting for
any sign of building momentum since 2012 Growth in India was cut by more than half in
2012 to 38%, which has proved challenging to bounce back from However, a rating agency,
Icra, has suggested there are signs for optimism, and has forecasted that growth in the iscal
year iscal year 2014-15 could reach 55%, as an upswing in manufacturing and investment
is expected in the second half of the iscal year2
Nevertheless, the larger picture is encouraging as Figures 3 and 4 illustrate—put another
way, there is no reason to be overly pessimistic when looking at longer trends and what this
means in a positive way for trade and shipping in the Indo-Paciic and in a global context
Approximately 92 billion tons of goods were loaded worldwide last year,3 with dry cargo
responsible for the lion’s share of this he shipping sector continues to experience marginal and unstable freight rates in its various segments because of surplus tonnage/liting
capacity in the global leet, particularly in the container trade Across all the main sectors
of dry and liquid bulk and the container trades, freight rates have stabilized again in real
terms from the drastic lows precipitated by the global economic crisis of 2008-2010 due to
a convergence in macro supply and demand as illustrated in Figure 4
Overall, the shipping industry is on the verge of exiting from its longest period of negative
growth in over 30 years- the result of chronic over capacity coupled with the massive decline
in market demand resulting from the global economic downturn
STIMSON CENTER | 97
Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
Figure 3. Trade composition of long-term shipping growth
Source: UNCTAD, Review of Maritime Transport, 7
Figure 4. Macro supply and demand of global shipping trade
15
10
5
0
Divergence
-5
-10
Convergence
-15
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Demand 107 24 105 116 134 106 112 114 42 -90 128 71 33 50
Supply
78 85
80
80
80 105 136 118 108 49 83
67 52 60
Source: UNCTAD, Review of Maritime Transport, 68
98 | SEA CHANGE
Rupert Herbert-Burns
Dry bulk shipping
he dry cargo segments are picked to be the biggest rises as demand for bulk commodities cargoes, in particular coal and iron ore, outstrips liting capacity for the irst time
in almost a decade Global bulk trade is slated to expand by some 58% in 2014 to 437
billion tonnes, outpacing a 53% rise in bulk carrier tonnage4 his year will be the irst
year since 2007 that the growth in demand for the “big ive” bulks- iron ore, grains, coal,
phosphates and bauxite—and the minor bulks such as cement, inished steel products,
non-ferrous metal ores (copper sulphide), sugar and timber has been greater than dry
bulk tonnage growth Once again, this acceleration in demand is being driven by the
major economies of the Indo-Paciic
he distribution of growth of combined iron ore, steam coal and coking coal imports in
recent years has been somewhat uneven Between 2008 and 2013, global trade of these
commodities grew on average by 7% year on year, with majority of tonne miles being
recorded in the Indo-Paciic region Approximately 98% of this growth was accounted
for by China and India (81% and 17% respectively)5 Unsurprisingly, bulk commodity
imports by most developed economies have declined during the same period China’s iron
ore and coal import growth has been critical for the dry bulk trade in the last few years
and consequently this sector of the shipping industry is enjoying some of the highest
freight rate indices of all In 2014, China’s share of global lits is projected to reach 46%
of the global trade in these commodities Nevertheless, though China’s imports dwarf
the absolute volume of imports by other economies, the pace of growth of India’s imports
has been greater than that of China’s6
Container shipping
Growth in containerised trade started to slow notably from 2012 and remains stubbornly
weak in 2014 Lit volumes of twenty foot equivalent units (TEU) increased by only 32%,
which contrasts sharply from 131% surge in 2010, and 71% in 20117 he sharp 2010 climb
can be explained in part by the fact that ater the bottoming out of the market in 2009, any
increase would represent a considerable trade “bounce”
he EU’s ongoing sluggish GDP growth continues to have a commensurate efect on lacklustre import demand for manufactured goods from Asia his has given rise to an undulating efect on global export volumes, in particular from Asia, which has contributed
signiicantly to the marginal numbers of stufed containers on the Asia-Europe container
strings he container trade world-wide has been further hampered by the massive surplus
of tonnage available his was the result of the very large numbers of vessels ordered by the
major lines prior to 2008, which completed while the world was still in recession and maritime trade was already hugely depressed
Dysfunctional supply and demand fundamentals in the liner trades has resulted in the major
container lines withdrawing some services on the Europe/Asia/Europe strings, ordering
slow-steaming, and seriously contemplating the creation of so-called “grand alliances” to seek
out economies of scale in order to survive Paradoxically, aggregate container throughput has
increased in net terms by 38% in the last 24 months, and containerised cargo processed by
ports in the Indo-Paciic region still account for some 30% of the global total8
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Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
Petroleum shipping & liquid bulk movement patterns
he crude oil tanker market in the irst half of 2014 is still sufering from substantial
tonnage oversupply, as it did for most of 2013, when freight rates fell to their lowest level in
many years However, in the 4th quarter of last year, record-high Chinese demand for crude,
weather-related delays and a slower leet growth caused the Baltic Dirty Tanker (chartering)
Index to rise above 1,000, and a degree of optimism returned to the market as did vessel
contracting9 However, in 2013, some 17 million deadweight tonnage (dwt) of new build
tankers was contracted for; pushing up both new-building and secondhand prices he
crude oil tanker leet of very large crude carriers (VLCCs), Suezmax and Aframax vessels
is now younger than it has been in years, and thus early scrapping seems inevitable if future
supply out-performs demand by a wide margin However, putting vessels into short and
mid-term lay-up, and longer travel distances could absorb the increasing inlow of vessels
in to the Indo-Paciic market segments
Ater a very tough 2012, the product tanker market improved in 2013 Freight rates gained
in during Q1 of 2013 as a particularly cold winter in the northern hemisphere drove up the
demand for heating oil; a good proportion of which is now being reined in, and exported
from, the mega reineries in the Indian Ocean (which I will address in greater detail shortly)
Later in the second half of the year, rates began to fall once again due to sotening demand,
which was exacerbated by the large number of new-build deliveries in late 2013, with more
on the way Currently, the market balance is very fragile; however, the growth in longer and
longer range lits of reined products and distillates with the extremities of the Indo-Paciic
and from the region to Europe and even the US means that demand could absorb this leet
growth hough still volatile, tanker freight rates are predicted to climb as demand fundamentals are strengthening in Asia, it is worth noting that 425% of all the world’s crude oil,
product and distillate trade is lited from and through the Indo-Paciic region, and this proportion of the global total will continue to grow Viewed at a strategic level, the region is home
to 496% of the entire world’s proven reserves; almost a third of all global gas production; and,
just under 56% of the total liqueied natural gas (LNG) lited by sea10
During the middle of 2014, there were signs of optimism for the major tanker operators as
freight rates picked up for crude oil lits; particularly on the routes from the Persian Gulf
to the Far East However, by November 2014, the tanker operators were becoming more
anxious about plummeting oil prices and the impact the global oil glut would have in the
short-to-medium term “Basket” prices of crude oil hitting a four-year low will likely have
a signiicant impact on the health of the crude tanker market Saudi Arabia, has maintained production volumes and drastically discounted contracted oil to the US in order to
squeeze the shale oil producers, which have contributed to falling US imports and external
oversupply China’s tightening demand has also contributed to threaten contracted lits of
crude and freight rates If the glut worsens, this will have a very serious negative impact on
the tankers market just when it was starting to show signs of recovery
Major ports & terminals
he Indo-Paciic region is home to by far the world’s largest container ports, more specifically the primary hub or transshipment ports, and the most strategically vital crude oil
terminals, LNG plants, and reining nodes in the world
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Figure 5. Global container throughput by port
Source: UNCTAB, Review of Maritime Transport, 91
Figure 6. Top 20 ports comparison of throughput (2002 & 2011)
Source: Rupert Herbert-Burns, 2014, derived from UCTAB data
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Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
he graph in Figure 5 shows that the share of Chinese mainland ports as a proportion of total
world container throughput remains at an estimated 25%, while the top 20 container ports,
all located in the Indo-Paciic, accounted for 47% of world container throughput in 2012
Figure 6 reveals the startling growth in throughput during the early part of the century
Note the considerable rise in TEU processing at the major Chinese ports and the continued
expansion at Singapore
Figure 7 cements the reality of the where the concentration of shipping and cargo processing lies, with Asia having 75% of the world’s largest ports in the world
Interestingly, despite the well-known capacity of the major Asian container ports, there are
several that are experiencing severe congestion, which is resulting in unloading and loading
log-jams and long delays for vessels at commercial anchorages waiting to come alongside
he most congested port is Manila; however, Hong Kong, Shanghai, Qingdao, Incheon
and Cat Lai in Vietnam are also badly afected Most worryingly, and perhaps surprisingly
to those not familiar with the port, it is Hong Kong that stands out as both a concern for
shipping lines reliant upon it and those seeking potential investment opportunities he
fundamental problem is a lack of berths and TEU processing infrastructure combined with
comparatively complex access and the need for many vessels to rely upon barges for TEU
transfer Overall, the problem is compounded with the complexity of processing cargo
for carriers using vessel-sharing agreements—the result of carriers trying to maintain
business share and rhythm in a trade with reduced margins and inconsistent proitability
he problems being experienced at Hong Kong are partially responsible for shipping lines
sending their vessels to other Chinese ports such as Guangzhou, and port managers are
Figure 7. Top 20 ports by continent
3
1
16
Asia
Europe
Other
Data Source: UNCTAB, Review of Maritime Transport, 88
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Rupert Herbert-Burns
even concerned that Hong Kong may lose its status as the third largest port in the region
ater Shanghai and Singapore
Port congestion and optimistic estimates of future macro trade grown through and with
the Indo-Paciic is forcing planning and construction of vast new container port areas A
notable example is the massive project to relocate Singapore’s main container terminal away
from the longstanding PSA facility located in the heart of the city to an expanded Pasir
Panjang facility; located in the country’s southwest Aside from the logistical imperatives,
the US$285 billion investment by PSA International is testament to its conviction in the
future growth of seaborne trade and the strategic necessity for Singapore to remain a global
maritime trading superpower11
Oil and gas terminals
From the point of view of the economic security of the producer countries in this space
and the energy security of the major consuming powers in Asia, in particular China, Japan
and India, there is no more important single factor than the unimpeded export of crude
oil from Iran, Iraq, Kuwait, Saudi Arabia and the UAE here are a large number of oil
terminals within the Persian Gulf and Arabian Peninsula space that contribute to export
approximately 18 million barrels of oil per day With 11 terminals, the UAE has the most,
followed in succession by Iran and Saudi Arabia with six each, and then Qatar, Kuwait,
Oman, Yemen and lastly, Iraq
he dominant player in this vital activity remains Saudi Arabia Saudi Aramco’s terminals
handle more than12 3,000 tanker loadings per year Aramco terminals are located at Ras Tanura
and Ju’aymah on the Arabian Gulf coast and at Jiddah, Rabigh, Jaizan, Yanbu’ and Duba on
the Red Sea coast However, it is the signiicant dominance of Ras Tanura and Ju’aymah in
terms of loading and export capacity that sets them apart he two terminals alone account
for over 32% of total crude exports by sea from the region, and almost 90% of Saudi Arabia’s
annual exports of crude oil his pivotal concentration of export capacity renders these Saudi
terminals arguably the two single-most important crude oil export facilities in the world In
2014, average global consumption of oil stands at approximately 92 million barrels of oil per
day, representing an average annual consumption of some 3358 billion barrels Of this, Ras
Tanura and Ju’aymah alone account for 1477 billion barrels, or 44%13
VLCCs bound for the major reineries in China, Japan, South Korea, India, Singapore,
Europe and the United States load approximately 13 billion barrels of oil each year at Ras
Tanura and Ju’aymah14 hese facilities are thus de facto the most vital single terminals
for the crude oil supply-security for the major importing states in the Indo-Paciic maritime realm Indeed, were the terminals to be put out of commission, the impact upon the
region and the wider global oil market would be severe in the extreme as the pipeline capacity within Saudi Arabia is currently insuicient to divert the terminals’ output to the
Kingdom’s primary Red Sea terminal at Yanbu
Kharg Island in Iran, Jebel Dhanna Terminal in the UAE and Kuwait’s Mina al Ahmadi
constitute the second tier output terminals in the region with a combined export output
representing 2811% of the region’s total; almost one third15 hough Saudi Arabia’s maritime export capacity tends to overshadow that of other producers in the region, it can
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Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
quickly be seen that even if the total maritime export capacity of Iran, the UAE and Kuwait
individually were to be compromised, the efect on dependent countries and the market-volume/price dynamic would be considerable
LNG terminals and exports
Ras Lafan Industrial City, inaugurated in February 1997, is situated along the northeast
coast of Qatar and covers an area of 106 sq km he facility’s primary purpose is the production, storage and loading of LNG, and to a lesser extent, the production of gas-to-liquid petroleum products using natural gas as feedstock In March 2007, Qatar solidiied its
leading role in world LNG production when RasGas completed its ith LNG production
train, giving the country a total of 307 million metric tonnes (MMt) (or 15 trillion cubic
feet [Tcf])16 of annual liquefaction capacity, the largest single source in the world
Physically and in terms of location, Ras Lafan’s petroleum geopolitical signiicance is
further enhanced due to two main factors—the scale of Qatar’s gas supply and the country’s
position Qatar’s North Dome gas ield is part of a larger structure—the South Pars/North
Dome gas condensate ield, which is shared between Iran and Qatar he structure is the
largest single gas ield in the world South Pars (which is located in Iranian waters) is the
northern part of the structure, with the North Dome located to the south in Qatari waters
With reserves in place equivalent to some 360 billion barrels of oil equivalent (BOE), the
ield is the planet’s biggest single hydrocarbon accumulation; larger than the world’s largest
oil ield, Ghawar, in Saudi Arabia he gas reserve estimates for the Qatari section stand at
900 tcf (255 tcm) of recoverable gas, equating to virtually 99% of Qatar’s proven reserves
and a staggering 14% of the world’s total proven gas reserves17
By way of a concluding overview of the Indo-Paciic region’s importance as a source and
exporter of LNG, data analysis reveals the relative contribution of various key terminals and
source countries viewed in terms of numbers of sailings per year, primarily to markets in
Japan, China, South Korea and India hough Ras Lafan is clearly the largest and most strategically vital single terminal in the region with over a thousand sailings of LNG carriers
per year, Australia aggregate sailings to key Asian markets is 357, placing it in a convincing
second place in terms of strategic source importance for the Indi-Paciic maritime realm
Combined, these terminals export 559% of all the LNG transported by sea in the world
Furthermore, it is estimated that Australia’s export volume is set to expand by over three
times from its current level of 24 million tonnes per year to over 80 million before the end of
this decade, thus making the country the number one exporter in Indo-Paciic over Qatar18
Strategic refining hubs
Almost a ith (181%)—of the globe’s aggregate reining capacity occurs in the Indo-Paciic
region19 Indeed, the region’s primary reining nodes—Jubail, Jamnagar and Singapore—have
reshaped the composition and pattern of the region’s petroleum trade so signiicantly that
these facilities are now amongst the most strategically signiicant single industrial sites in the
northern Indian Ocean Changes in the long-established global patterns of crude oil transportation, once thought to be a ixed phenomenon, which are being recast as a result of the
signiicant expansion of reining capacity, are also altering the patterns of petroleum trade in
the wider Indo-Paciic area as reining capacity and distribution capacity builds in the Indian
Ocean whereas before this capacity dominance resided largely in north-east Asia
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Rupert Herbert-Burns
Figure 8. Map of petroleum shipping flow lines
Source: Rupert Herbert-Burns, 2014
he progressive increase in the product tanker leet, particularly the larger variants, has
been driven by the increasing emphasis in international trade of reined product and distillates from major reining complexes and those countries in parts of Africa and Asia with
limited or no reining capacities Large product tankers, with the capability to convey a
wide range of diferent products, function as a “petroleum lifeline” for some states and
very distant local storage and distribution facilities his has been the case for major reineries in Saudi Arabia and Singapore and, increasingly, the export-conigured reineries
in India Saudi Aramco’s reining complex at Jubail on the Kingdom’s Persian Gulf coast
and Reliance Industries’ massive reinery at Jamnagar in Gujarat (currently the largest single-site reinery in the world) can be deined as strategic reining hubs, while Singapore is
arguably the world’s optimum example of a petroleum gateway
Figure 8 reveals how product/distillate low lines emanate from the big three hubs – with
reined products not only reaching those Indian Ocean states and territories with limited or
not reining capacity of their own, but also reaching deep into the western and north-western
Paciic Products from Jubail and Jamnagar are also exported to Europe and West Africa
Shipbuilding and new vessel technology
he ship-building industry in the Indo-Paciic is in the midst of a consolidation process
whereby ineicient yards are being shut down, client buyers are seeking greater quality
while squeezing on cost—it is certainly a buyers’ market, and building capacity is adjusting
to lower future demand he major success story centers on the high turnout of sophisticated oil exploration and production units, such as drill-ships and loating production units
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Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
Figure 8. Drilling rig count by country
Increases in drilling rigs
and subsequently
ofshore production
units out to 2030
Source: Rupert Herbert-Burns, 2014
from the South Korean yards—Samsung Heavy Industries and Daewoo Building activity
of jack-up drilling rigs, loating production, storage and oloading unit (FPSO) conversions
and ofshore support vessels in Singapore continues apace, with the Keppel yard showing
the most impressive gains Figure 9 illustrates how the growth in exploratory drilling in
the Indian Ocean region will continue to drive the need for more drilling rigs in the region
Although tensions are still high in the South China Sea, in the fullness of time demand for
more shallow-water drilling capacity will also emerge
Separately, one of the key drivers of ship-building growth for the major Asian yards is the
upswing in demand for liting many of the major bulk commodities of iron ore, coal and
grain, supported by expanding demand for the minor bulks such as fertilizer, logs and soya
Paradoxically, building or and new orders for the latest high-capacity super post-Pananmax
container vessels continues as Maersk’s competitors attempt to emulate the strategy of the
Danish giant’s development of their Triple-E class of 18,000 TEU capacity ships hese new
leviathans of the Indo-Paciic SLOCs represent the very latest manifestations in commercial
shipping technology as evidenced by the name of the class—Triple-E, whereby the vessel
generate greater eiciency by being able to lit more containers in a single hull over great
distances; increased economy is achieved through up-scaling and more fuel-eicient propulsion, which in turns renders the ships more environmentally friendly by reducing CO2
and other emissions per ton mile
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Debate concerning the eicacy of sustained building of new mega-capacity container vessels
continues Nevertheless, it is the long-term expansion campaigns the major container lines,
the strategic beneits of trading strings with high-capacity ships, and the positive economies
of scale inherent in being able to lit huge numbers of TEUs in a single hull, which will underpin the large new-build order-books of the major builders in South Korea and China
As an overall indication of the positive outlook for Asian ship-builders, the data indicates
that the cost of both new-build and secondhand vessel started to climb in 2013 on owner
and charterer expectations of a macro trading recovery However, some analysts warn that
some operators will still only break even in 2014, and that recovery may falter in 2017 when
tonnage overcapacity could again overtake demand for lit in some trades, including the
east-west-east liner trade
Outlook
he Indo-Paciic maritime realm contains several of the cornerstones of short-to-medium
macro-economic resilience and growth, notably China and India, and Africa will become
a key driver of long-term regional demand growth hese cornerstones are in diferent
ways also sources of raw material and manufactured good supply When combined with
the maritime links and shipping capacity that links the markets and centers of production of Europe, Africa, Asia and Australasia, the contribution of the Indo-Paciic trading
system to the state and future prosperity of the global economy is impossible to overstate
Encouragingly, at the time writing, the outlook is fairly sanguine Ship owners are conident that maritime trading fundamentals will support an upturn well into 2016 Bulk cargo
trades are trending towards growth as demand growth outstrips available vessel tonnage
Trade in reined petroleum products and bulk gas remains resilient his positive outlook is
tempered by concerns over weak container shipping fundamentals and declining regional
and global demand for crude oil, which is threatening bulk liquid freight rates
Regional and global economic luctuations and their commensurate efects upon the volume
and pace of seaborne trade in the Indo-Paciic are axiomatic However, as shown in this
essay, the fundamentals of this vast maritime trading region underpin long-term resilience
and growth in seaborne trade In the end, these fundamentals speak for themselves: Aside
from the considerable volume of containerised cargo processed by ports in the Indo-Paciic
(approximately 30% of the global total), some 425% of all the world’s crude oil, product and
distillate trade is lited from and within the region he region is home to 496% of the entire
world’s proven reserves; almost a third of all global gas production; and, just under 56% of
the total LNG lited by sea When combined with the expanding middle class segments in
China and India—a vital driver of demand for inished and high-end manufactured goods,
and the resilience of GDP igures for the major African economies, it is evident that this
entire hemisphere will remain a growing and dynamic maritime trading space hough it
must always be born in mind that trade and economic security is also impacted by the inimical efects of persistent geopolitical insecurity, great power completion, and asymmetric
security threats, it is the lasting and positive reality that states fundamentally also seek and
gain some measure security through economic prosperity and trade
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Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
About the Author
Rupert Herbert-Burns is Director of Triton Consulting and a non-resident Fellow at the
Stimson Center in Washington, DC A leading international maritime consultant, he
engages in security and operational risk management projects for shipping, ofshore oil
and gas clients, and private maritime security irms with operations in Africa, Asia and
Europe Previously, as a director at Lloyd’s Marine Intelligence Unit in Washington and
London, Herbert-Burns was engaged in security-risk and shipping data analysis, port security surveys and threat assessment support roles for branches of the US military and
government, NATO, UK Metropolitan Police and NYPD As part of his reserve military
service, Herbert-Burns works as a lead advisor to Her Majesty’s Government and key British
oil and gas companies with regards to petroleum sector security Prior to his current professional activities, Herbert-Burns was commissioned as a warfare oicer in the Royal Navy;
serving worldwide on major surface warships, a conventional submarine, and support
vessels He also had subsequent service as an infantry platoon commander with the Brigade
of Gurkhas Herbert-Burns has master’s degree (Security Studies) and a PhD (Petroleum
Geopolitics) from the University of St Andrews in Scotland
Notes
1 Damian Grammaticus, “China growth shows signs of pick-up from 13-year low,” BBC News, 18 January
2013, at http://wwwbbccouk/news/business-21071546
2 ICRA Research Services, “Economic Outlook and Macro Trends—Quarterly,” August 2014, at http://icra
in/Files/ticker/SH-2014-Q3-1-ICRA-Economypdf
3 United Nations Conference on Trade and Development, Review of Maritime Transport 2013 (Geneva:
UNCTAD, 2013), at http://unctadorg/en/publicationslibrary/rmt2013_enpdf
4 “Shipping in cruise control as cargo growth surges,” he Star Online (Singapore), 8 February 2014, at http://
wwwthestarcommy/Business/Business-News/2014/02/08/Shipping-in-cruise-control-End-to-industrydownturn-expected-as-cargo-growth-surges/?style=biz
5 “Major Commodities, Major Changes?” Clarksons Shipping Intelligence
Network, 24 February 2014, at http://wwwclarksonsnet/markets/feature_display
asp?section=&news_id=35099&title=Major+Commodities%2C+Major+Changes%3F
6 Ibid.
7 UNCTAD, Review of Maritime Transport 2013
8 World Trade Organisation, Trade patterns and global value chains in East Asia: From trade in goods to
trade in tasks (Geneva: WTO, 2011), at http://wwwwtoorg/english/res_e/booksp_e/stat_tradepat_globvalchains_epdf
9 Danish Ship Finance, Shipping Market Review—May 2014, Copenhagen, 2014, p2, at http://wwwshipinancedk/en/Shipping-Research/~/media/PUBLIKATIONER/Shipping-Market-Review/Shipping-MarketReview---May-2014ashx
10 BP plc, BP Statistical Review of World Energy 2013 (London: BP, June 2013), at http://wwwbpcom/
content/dam/bp/pdf/statistical-review/statistical_review_of_world_energy_2013pdf
11 Mike King, “Singapore Port Planning for Capacity of 50 Million TEUs,” Journal of Commerce, 2 October
2012, at http://wwwjoccom/port-news/singapore-port-planning-capacity-50-million-teus_20121002html
12 Rupert Herbert-Burns, “Energy in the Indian Ocean: Vital Features and New Frontiers,” in
David Michel and Russell Sticklor, eds Indian Ocean Rising: Maritime Security and Policy Challenges
(Washington, DC: Stimson, 2012), p24
13 Lloyd’s List Intelligence, APEX (Proprietary)
108 | SEA CHANGE
Rupert Herbert-Burns
14 Ibid.
15 Ibid.
16 TAIB Research, “Qatar Gas Transport Company (Nakilat) (QGTSDSM),” Research Report, 3 April
2008, at http://aezawyacom/researchreports/taib/20080403_Taib_122352pdf
17 Daniel Canty, “Field Focus: Iran’s South Pars development,” Arabiaoilandgascom, 24 May 2011, at
http://wwwarabianoilandgascom/article-8926-ield-focus-irans-south-pars-development/
18 Lloyd’s List Intelligence, APEX)
19 “Top 10 large oil reineries,” Hydrocarbons-technologycom, 30 September 2013, at http://wwwhydrocarbons-technologycom/features/feature-top-ten-largest-oil-reineries-world/
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Shipping Developments and Challenges in the Indo-Pacific Maritime Realm
110 | SEA CHANGE
Fisheries, Food Security, and Climate Change
in the Indo-Pacific Region
David Michel
The Stakes
he living resources of the waters of the Indo-Paciic represent one of the region’s most
signiicant assets According to the United Nations Food and Agriculture Organization
(FAO), catches taken from the marine capture isheries of the Indian Ocean and western
Paciic have soared from less than 20 million metric tonnes in 1970 to 46 million tonnes
in 2012, over 57 percent of the world catch Among the world’s ishing nations, 14 of the 18
largest producers (and all of the top 10) lie around the Indo-Paciic rim, accounting for more
than two-thirds of the global haul Aquaculture—farming ish, shellish, and other aquatic
animals in captivity—has expanded equally rapidly, growing ive-fold globally since 1980,
to nearly 67 million tonnes in 2012 hirteen of the top iteen producers of farmed ish sit
on the Indian or Paciic Ocean1
Harvesting the ocean’s bounty contributes substantially to regional livelihoods and in many
communities occupies much of the labor force Fisheries contribute substantially to many
regional economies, particularly in the small island states In the Maldives, for example,
isheries represent some two percent of GDP, but constitute 90 percent of domestic exports
For the Seychelles, isheries and associated activities (such as canning) represent 16 percent
or more of formal employment, and half of foreign exchange earnings2 In the Paciic, half
of all households in many small island nation coastal communities earn their irst or second
incomes from catching or selling ish3 Fisheries are also economic lynch pins for several larger
states In Indonesia, for example, ishing and ish farming employ nearly six million people,
a number greater than the labor force working in the country’s vaunted textile and apparel
industries In addition, the FAO reckons that for each person directly employed in ish capture
or aquaculture, another three to four gain jobs in related activities such as boat construction,
gear maintenance, and ish processing, packaging, and distribution4 Further, four of the ive
biggest ishery commodity exporters also hail from the region, with China earning USD$182
billion in 2012, hailand $81 billion, Vietnam $63 billion, and the US $58 billion5
More importantly, isheries and aquaculture furnish vital food supplies to hundreds of
millions of people around the Indo-Paciic On average, the populations of China, Egypt,
Japan, Malaysia, Mozambique, Myanmar, North Korea, the Philippines, Qatar, Seychelles,
Singapore, South Korea, Tanzania, hailand, and Vietnam obtain 20 percent or more
of their animal protein from ish he inhabitants of Bangladesh, Comoros, Indonesia,
Maldives, and Sri Lanka get more than half of the animal protein in their diets from ish6
Fisheries thus contribute to human security and social welfare both as a food source and
as a source of livelihoods
Around the Indian Ocean, littoral states large and small are moving to seize on these trends
Australia, noting that global demand for ish, ish meal, and ish oils will double in value
by 2050, plans to capitalize on its proximity to increasingly aluent Asian markets to boost
exports of “clean and green” food commodities, positioning itself to reap the beneits of
building an “environmentally friendly” product brand, according to a recent government
STIMSON CENTER | 111
Fisheries, Food Security, and Climate Change in the Indo-Pacific Region
Figure 1. Marine capture fisheries: major producer countries
Source: FAO Fisheries and Aquaculture Department, he State of World Fisheries and Aquaculture 2014 (Rome: FAO, 2014)
White Paper7 Meanwhile, the Mauritius Ministry of Fisheries aims to transform the island
into an Indian Ocean “Seafood Hub,” ofering services along the entire value chain from
unloading catches to warehousing, processing, and distribution of seafood products8
Yet, the long-term health of isheries in Indo-Paciic is diicult to gauge Fisheries production naturally varies from year to year, and data on catches is also frequently inadequate
and many speciic regional isheries and species stocks remain unassessed Total annual
capture from global marine isheries has remained relatively stable in the period 2007 to
2012 at about 80 million tonnes In the Indian Ocean, catches in the western portion have
held steady over the past decade, but catches in the eastern region have surged more than
a third since 2003 In the Paciic, catches in the northwest and central western areas have
grown modestly over the same period, while falling by almost 18 percent in the southwest
(See Figure 2) he total national wild ish catch of some countries in the region can include
112 | SEA CHANGE
David Michel
signiicant amounts of ish harvested outside coastal waters and the 200 nautical-mile
Exclusive Economic Zone (EEZ), and in some cases catches from beyond the Indian Ocean
or western Paciic Despite the appearance of relative stability in the composition of the
catch by species and distribution by country, ishing area and species in some cases have
been changing markedly in recent years Fish size has been steadily decreasing for a number
of species, and mature ish are increasingly scarce In general, the most commercially important ish species in both bodies of water are considered overished9
Climate Change Impacts in the Indian Ocean and western Pacific
Coastal and marine areas igure among the most vulnerable of all environments to global
climate change10 Projected impacts from global warming include rising sea levels, stronger tropical cyclones, larger storm surges, increasing sea surface temperatures, and—as the
oceans absorb more of the carbon dioxide that human activities emit to the atmosphere—
growing acidiication of surface waters Climate change will also interact with other human
stressors on marine systems, such as overishing, habitat destruction, and marine pollution,
in complex patterns Signiicant portions of the Indian Ocean and western Paciic already
igure among the most highly impacted marine ecosystems on earth
he consequences of these multiple pressures for speciic isheries are diicult to evaluate
In some cases the impacts may be additive, that is to say cumulative of the impacts of each
individual stressor But some efects may be of-setting, the impacts of one stressor mitigating the impacts of another By the same token, interactions between still other stressors
may be synergistic, exacerbating negative impacts beyond the sum of individual pressures
Yet at present, little is known about how the ultimate efects of myriad stressors exerting
overlapping pressures in concert may vary over time, between diferent marine ecosystems,
or between species, further complicating policy eforts to manage isheries sustainably11
For isheries, coastal and marine ecosystems, and communities around the Indo-Paciic,
the repercussions could be considerable, threatening the livelihoods, health, and welfare
of millions of people
Climate change will expose isheries and isher communities to increasing risks at sea and
on shore Along their coasts, Indo-Paciic nations may sufer stronger and more frequent
storms and higher storm surges Recent studies suggest that tropical cyclones in the region
could grow more intense, with likely increases in extreme high water levels and maximum
wind speeds12 Projected climate impacts to the Indian Ocean and western Paciic littoral
especially threaten the region’s growing maritime and ishing infrastructure Cyclones and
storm surges can destroy ports, docks, ishing boats and equipment, storage and processing facilities, as well as the ponds, cages, and other installations and material necessary
for coastal aquaculture In May 2008, for example, Cyclone Nargis smashed into Burma,
leaving 27,000 isheries workers missing or dead, destroying over 3,000 boats, and inlicting losses of 160 billion kyat (US$ 245 billion) in damages and forgone production on the
country’s ishing sector Typhoon Haiyan, which struck the Philippines in November 2013,
is estimated to have damaged or destroyed 30,000 ishing boats, with total damages from
the storm impacting more than 200,000 ishing households13 Beyond such acute natural disasters, progressive sea level rise may jeopardize freshwater aquaculture in low-lying coastal
areas, contaminating ponds and ish pens by gradual saltwater intrusion14
STIMSON CENTER | 113
Fisheries, Food Security, and Climate Change in the Indo-Pacific Region
Figure 2. Marine capture: major fishing areas
Source: FAO Fisheries and Aquaculture Department, he State of World Fisheries and Aquaculture 2014 (Rome: FAO, 2014)
Additional climate change impacts will manifest in the ocean itself As world emissions
of greenhouse gases (GHGs) have grown, the oceans have absorbed increasing amounts
of this added carbon dioxide from the atmosphere Since the beginning of the Industrial
Revolution, the cumulative ocean uptake amounts to some 30 percent of humanity’s
total CO2 emissions he extra carbon dioxide alters the ocean’s chemistry, rendering it
more acidic (measured by a lower pH value) From preindustrial levels, the acidity of the
surface ocean layer has spiked by 26 percent, corresponding to a drop in pH of more than
01 units If greenhouse emissions continue unabated, pH levels will tumble a further
013 to 042 points over the 21st century, a change 30 to 100 times greater than those seen
in the past and at a rate unprecedented in at least the past 300 million years15 By the
same token, as climate change warms global average temperatures, the oceans are also
absorbing heat from the atmosphere In the past 50 years, the oceans have soaked up 93
percent of the supplemental heat generated by global warming, boosting surface ocean
water temperatures by about 01oC per decade since 1971 By 2090, average surface ocean
temperatures are projected to be nearly 3oC higher than in 1990, under a continuing high
GHG emissions scenario16
114 | SEA CHANGE
David Michel
Over the coming decades, oceanic warming and acidiication could signiicantly distress marine
ecosystems and global isheries, afecting the physiology, reproduction, and development of
individual species as well as the relations between species and their habitats, food sources,
competitors, predators, and pathogens17 One recent study, for instance, inds that changes in
ocean temperature and biogeochemical properties could substantially afect the ecophysiology
of marine organisms, diminishing the average maximum body weight of ocean ishes by 14 to
24 percent by 2050 he largest projected shrinkage—24 percent—occurs in the Indian Ocean18
Available analyses suggest that climate change could also engender substantial shits in
catch sizes and locations by mid-century19 Across the Indo-Paciic, for example, many
tropical isheries depend upon coral reefs for food and habitats Globally, coral reefs are
thought to support about 10 percent of all ish caught in tropical countries and 20 to 25
percent of ish caught by developing island states But climate change imperils up to twothirds of the world’s coral reefs with long-term degradation from coral bleaching, storm
damage, and other pressures As a result, production of reef ish in the Paciic is projected
to drop 20 percent by 205020
Overall, global maximum potential catches may witness little change (+ 1%), but projected
potential catches in diferent regions under climate change vary from considerable increases to precipitous declines In Indo-Paciic isheries, model simulations project marked increases in maximum catch potential in 2055 relative to 2005 levels in much of the Arabian
Sea and East African waters, while catch potentials may plummet by 30 to 50 percent or
more in the Red Sea, Persian Gulf, Bay of Bengal, and the high seas of the equatorial Indian
Ocean Similarly, maximum catch potentials may rise 50 to 100 percent in parts of the
Northwestern Paciic, while falling more than 50 percent across the western central Paciic
For Indonesia, lying between the Indian Ocean and Paciic, catch potentials within its EEZ
are projected to slip more than 20 percent by 2055, the largest drop for any country21
Such a signiicant shule of ishing potential could dramatically alter isheries politics across
the region Rising catch potentials in the western Indian Ocean and Arabian Sea could draw
in competing leets from Europe, China, and elsewhere By the same token, about one third
of the current catch from the Bay of Bengal comes from ishing areas beyond national EEZs
his same area is projected to sufer dramatic declines in catch potential at mid-century
Falling catch potential in the open ocean could push regional and extra-regional leets to
seek out new ishing grounds to make up the diference, potentially colliding with similar
eforts by other leets22 Large-scale redistribution of world ish catches could risk creating
both winners and losers, reverberating across the Indo-Paciic and beyond
Economically, ongoing climate change risks substantial harm to world fisheries
Estimates indicate global warming of 2oC could cut the value of world catches some 17
to 41 billion dollars a year by 2050, with East Asia and the Pacific bearing the deepest
losses 23 Equally troubling is the danger to the region’s food security All told, the food
security vulnerability of any one country to climate change impacts on fisheries can
be construed as a combination of that country’s fisheries catch exposure to climate
impacts, the country’s dependence on fish and seafood consumption as a source of
available protein, and the country’s adaptive capacity—expressed through GDP per
capita, projected population growth, and present rates of undernourishment in the
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Fisheries, Food Security, and Climate Change in the Indo-Pacific Region
population Evaluated on these measures, one recent analysis ranked eight countries
in the Indo-Pacific region—Comoros, Cook Islands, Kiribati, Eritrea, Mozambique,
Madagascar, Pakistan, and Thailand—among the ten most vulnerable nations worldwide to food security threats from climate impacts on fisheries 24
Regional Organizations and Initiatives
for Sustainability Cooperation
Several regional and international agreements exist to promote the sustainable management
of the Indian and Paciic Oceans’ resources Among the most important, the 1982 United
Nations Convention on the Law of the Sea (UNCLOS) underpins other international treaty
arrangements addressing marine resources by establishing the regime of EEZs deining national maritime limits and jurisdiction, bringing waters out to 200 nautical miles under the
regulation and control of coastal states Other international instruments such as the 1993
Agreement to Promote Compliance with International Conservation and Management
Measures by Fishing Vessels on the High Seas; the 1992 Convention on Biological Diversity;
the 1995 UN Agreement on Straddling Fish Stocks and Highly Migratory Stocks; the 1995
UN Food and Agriculture Organization Code of Conduct for Responsible Fisheries and
follow-on 1998 International Plan of Action for the Management of Fishing Capacity; the
2001 International Plan of Action to Prevent, Deter and Eliminate Illegal, Unregulated
and Unreported Fishing; and the 2013 UN General Assembly Resolution on Sustainable
Fisheries also contain provisions on cooperation to optimize isheries management and
protect marine biodiversity
hese international arrangements constitute a patchwork of participation and compliance All Indo-Paciic states except Iran, the United States, and North Korea are party
to UNCLOS Many important isheries states, though, have not joined the 1995 UN
Fisheries Agreement on Straddling Fish Stocks he 1995 Code of Conduct for Responsible
Fisheries and related International Plans of Action (IPOAs), for their part, are widely
deemed import tools for sustainable management, but they are voluntary agreements
Compliance with the Code, moreover, has proven very poor, with Indo-Paciic countries
iguring among the least conformant25
he Indo-Paciic also counts a number of isheries commissions and broader environmental organizations Yet these institutions have not been constructed to encompass the whole
region, but instead operate at the level of a sub-regional system or an individual species26
In the Indian Ocean, for example, the Indian Ocean Tuna Commission (IOTC) encompasses the entire Indian Ocean, but only addresses the catch of tuna and “tuna-like” species
Similarly, the Commission for the Conservation of the Southern Bluein Tuna (CCSBT)
covers the migration range of that species across the southern Indian Ocean, but its membership is small he Southwest Indian Ocean Fisheries Commission (SWIOFC) has the
waters of of East Africa as its area of competence, covering all species in this zone, but has
no management powers In the Persian Gulf and Gulf of Oman, the Regional Commission
for Fisheries (RECOFI) can make management recommendations, but they are not binding
if a state objects he Bay of Bengal Large Marine Ecosystem (BOBLME) Project unites the
eight littoral countries from the Maldives to Malaysia to formulate a common program of
action for improved management of the coastal environment and isheries, but it is limited
116 | SEA CHANGE
David Michel
to the Bay of Bengal A new body, the South Indian Ocean Fisheries Agreement (SIOFA),
covering all ish in much of the western and southern ocean beyond national EEZs, has only
recently entered into force in June 2012
In the Paciic, the Western and Central Paciic Fisheries Commission (WCPFC) enjoys
the broadest remit, covering all species of highly migratory ish stocks in the region and
counting 24 states, seven territories, and the European Union among its members he
North Paciic Anadromous Fish Commission (NPAFC) espouses relatively rigorous regulatory objectives, but covers only particular species of salmon and trout and applies only
to Canada, Japan, Korea, Russia, and the US, with any important management decisions
taken only by consensus he Paciic Islands Forum Fisheries Agency (FFA) holds only
advisory authority, while the Asia-Paciic Fishery Commission (APFIC)—which also
includes part of the Indian Ocean—possesses a broad mandate to promote the conservation and management of aquatic resources among its twenty members, but it has no
regulatory powers and does not encompass the western Indian Ocean he South Paciic
Regional Fisheries Management Organization (SPRFMO), inally, like the SIOFA, only
entered into force in August 2012
While the management effectiveness and sustainability of the SIOFA and SPRFMO
cannot yet be evaluated, recent assessments of the world’s Regional Fisheries Management
Organizations (RFMOs) found many performing poorly27 Comparing ishing mortality
and biomass to the rates that would maintain the maximum sustainable yield, the IOTC
and NPAFC received a score of 778 percent on a scale of 0-100 he WCPFC, though, garnered only 667 percent, while the CCSBT received a score of zero percent he efectiveness
of both international and national-level management and regulation is limited by high levels
of noncompliance Fishers have little incentive to limit their catches since monitoring and
enforcement of catch limits is low and much marine legislation is outdated In response to
this problem, some isheries management has moved towards the decentralization and localization of management authority Local communities in the southwest Indian Ocean, for
example, have increasingly asserted their own regulations and enforcement of ish stocks
By the same token, the Indo-Paciic area is home to a number of regional economic organizations and political associations that also vary in their mandates and membership
hough primarily directed to economic and security issues, many of these institutions have
increasingly moved to engage environmental issues and sustainable development policy As
such, they may provide broader fora in which isheries management challenges that transcend national borders and single issue agencies may be set in larger economic, political,
and human security contexts potentially amenable to regional cooperation Even so, these
regional economic and political bodies confront some of the same diiculties as the isheries
organizations in the form of geographical fragmentation and the lack of binding decision
authority across their members
he Indian Ocean Rim Association (IORA), previously known as the Indian Ocean Rim
Association for Regional Cooperation, has the broadest membership It includes a wide
array of Indian Ocean rim states and aims to foster economic, scientiic and cultural cooperation he IORA membership counts 18 Indian Ocean states—with some important
absences—plus eforts to engage extra-regional powers such as the US as dialogue partners
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Fisheries, Food Security, and Climate Change in the Indo-Pacific Region
While the IORA charter does not extend to security issues, piracy of of Somalia has been
raised as a matter of mutual concern to maritime trade and isheries he IORA is not perceived as being particularly efective and some member states, notably India, have mooted
reform measures that would expand the charter to better facilitate regional cooperation on
maritime issues and the environment
Nevertheless, region-wide institutions are lacking he association of Southeast Asian
Nations (ASEAN), the South Asian Association for Regional Cooperation (SAARC),
Southern African Development Community (SADC), the Gulf Cooperation Council (GCC)
and the Indian Ocean Commission operate at the sub-system level Other bodies such as
the African Union and the Asia-Paciic Economic Cooperation (APEC) partly overlap
the Indo-Paciic region while also incorporating other members beyond it he ASEAN
Regional Forum (ARF) includes Southeast Asian and eastern Indian Ocean states but does
not include western Indian Ocean states Similarly, Australia has proposed an Asia Paciic
Community (APC) to comprise the 21 members of the Asia Paciic Economic Community
(APEC) together with the addition of India he APC would promote regional dialogue on
economic, cultural, strategic and security Yet the focus is predominantly directed toward
the Paciic, with the inclusion of Russia and the US, while it appears that Indian Ocean
states like Pakistan, Bangladesh, Sri Lanka, and East African and Middle Eastern nations
may not be included28 here remains no region-wide Indo-Paciic arena in which convergent regional food security, economic and environmental issues—including isheries—can
be considered in a collectively inclusive manner
Nevertheless, regional countries are coming to recognizing threats to isheries from climate
change and trying to bring ishing under cooperative and regulatory regimes he intergovernmental Southeast Asian Fisheries Development Center (SEAFDEC), for instance, established in December 1967, now seeks to promote sustainable ishing he Center’s Member
Countries are Brunei, Cambodia, Indonesia, the Lao PDR, Myanmar, the Philippines,
Singapore, hailand, and Vietnam (all members of ASEAN), plus Japan In 2009 at the 41st
meeting of its policy-making Council of Directors, the Council adopted a new SEAFDEC
Program Framework, which includes a mandate to develop and manage the isheries potential of the region by rational utilization of the resources for providing food security and
safety to the people and alleviating poverty through transfer of new technologies research
and information dissemination activities”29
At the bilateral level, some indicators suggest the possibility that shared interests can foster
sustainable isheries management even in the face of the most serious surrounding political disputes he 2000 Boundary Agreement between Vietnam and China over the Gulf of
Tonkin marked the limits of the territorial seas, contiguous zones and Exclusive Economic
Zone of both countries he agreement on boundaries entered into efect in 2004 with ratiication by both the Chinese and Vietnamese, and coincided with a parallel agreement on
ishery management ratiied on the same day he isheries agreement established a Joint
Fisheries Commission intended to allow for successful co-management of ish stocks that
crossed the newly created maritime border in order to prevent depletion of those resources hough there have been clashes between ishermen and ishery administrations of both
sides and frictions in the South China Sea continue to test their relationship, joint patrols
of the Gulf of Tonkin have continued since 200530
118 | SEA CHANGE
David Michel
Conclusion
A staple of regional food security, isheries represent one of the Indo-Paciic’s most important resources he sustainable usage of those natural assets will be a key to securing
the region’s future welfare As the global population swells from 7 billion to 9 billion by
mid-century, some studies anticipate that world ish production might need to rise by half
from current levels to keep pace with projected food requirements Yet current overexploitation of most of the planet’s ishing grounds coupled with emerging climate and other environmental strains on marine ecosystems cast doubt on whether the world’s isheries can
readily achieve such yields sustainably without signiicant management improvements31
he regional isheries management organizations (RFMOs) and other international institutions can provide the governance tools to ensure the sustainable development of vital
marine resources, but they must be strengthened and consistently implemented and enforced he capacities of the RFMOs to formulate and apply sustainable strategies and regulations must be bolstered in line with current best practices and their performance regularly
reviewed, updated, and—most importantly—coordinated regionally to eliminate gaps in
geographical and species coverage and address transboundary issues such as mitigating
and adapting to climate pressures
Ultimately, political will from all the Indo-Pacific littoral and fishing countries will
be required to promote effective management collaboration Most of the current governance efforts fall short in this regard The regional mechanisms that do exist have
successfully identified many of the most important risks to sustainability and food
security Whether the necessary cooperation will develop fast enough to meet these
challenges remains an open question
About the Author
David Michel is a Senior Associate and Director of the Environmental Security Program
at he Stimson Center His work explores emerging governance challenges and security
risks posed by global environmental change Michel has written widely on transboundary
water resources management, maritime policy, the international impacts and implications
of global warming, and on the possibilities for collective institutions to address common
environmental problems He has advised the National Intelligence Council and the US
Departments of Defense, Energy, and State on water security and climate policy issues He
lectures frequently on environmental security at universities in the US and abroad, and
has consulted with NGOs and the private sector on the international climate negotiations
process, isheries, and water resources Prior to joining Stimson in 2008, Michel served as
senior associate with the Center for Transatlantic Relations at Johns Hopkins (SAIS) He
was educated at Yale University, the École des Hautes Études en Sciences Sociales in Paris,
and he Johns Hopkins University School of Advanced International Studies
STIMSON CENTER | 119
Fisheries, Food Security, and Climate Change in the Indo-Pacific Region
Notes
1 FAO Fisheries and Aquaculture Department, he State of World Fisheries and Aquaculture 2012 (Rome:
FAO, 2012), pp54-55, at http://wwwfaoorg/docrep/016/i2727e/i2727epdf; FAO Fisheries and Aquaculture
Department, he State of World Fisheries and Aquaculture 2014 (Rome: FAO, 2014), pp11, 22, at http://www
faoorg/3/a-i3720epdf
2 Maldives Monetary Authority, Annual Economic Review 2011 (Male: MMA, 2012), p22, at http://mma
govmv/ar/ar11pdf; Central Bank of Seychelles, “Fisheries Industry of the Seychelles: At a Crossroad,” First
Quarterly Review, Vol24, No1 (2006)
3 Johann D Bell et al, “Mixed responses of tropical Paciic isheries and aquaculture to climate change,”
Nature Climate Change 3 (591) 2013
4 FAO, he State of World Fisheries and Aquaculture 2012, pp43, 46; Textile World Asia, Country
Proile: Indonesia, November/December 2006, at http://wwwtextileworldasiacom/Issues/2006/
November-December/Features/Country_Proile-Indonesia
5 FAO, he State of World Fisheries and Aquaculture 2014, p55
6 In addition, of the 23 small island states and territories of the Paciic, eight obtain 20 percent or more
of their animal protein from ish, and another four obtain 50 percent or more FAO, FAO Yearbook 2012:
Fishery and Aquaculture Statistics (Rome: FAO, 2014), pp63-68, at http://wwwfaoorg/3/a-i3740tpdf
7 Australian Government, Australia in the Asian Century, White Paper (Canberra: Commonwealth of
Australia, October 2012), at http://wwwasiaeducationeduau/verve/_resources/australia-in-the-asian-century-white-paperpdf
8 Prime Minister’s Oice, he Ocean Economy: A Roadmap for Mauritius, Republic of Mauritius, December
2013, at http://wwwoceaneconomymu/PDF/Brochurepdf
9 U hara Srinavasan et al, “Global isheries losses at the exclusinve economic zone level, 1950 to present,”
Marine Policy, 36 (544) 2012; Tony J Pitcher and William WL Cheung, “Fisheries: Hope or despair?”
Marine Pollution Bulletin, Vol74, No2 (2013)
10 Monika Rhein and Stephen R Rintoul et al, “Observations: Ocean,” in Climate Change 2014: he Physical
Science Basis. Contribution of Working Group I to the Fith Assessment Report of the Intergovernmental Panel
on Climate Change, homas F Stocker et al eds (Cambridge: Cambridge University Press, 2014); at http://
wwwipccch/report/ar5/wg1/; Poh Poh Wong and Iñigo J Losada et al, “Coastal Systems and Low-Lying
Areas,” and HO Pörtner and David M Karl et al,”Ocean Systems,”both in Climate Change 2014: Impacts,
Adaptation, and Vulnerability—Part A: Global and Sectoral Aspects Contribution of Working Group II to the
Fith Assessment Report of the Intergovernmental Panel on Climate Change, Christopher B Field et al eds
(Cambridge: Cambridge University Press, 2014), pp361-484, at http://wwwipccch/report/ar5/wg2/
11 Caitlin Mullan Crain, “Interactive and cumulative efects of multiple human stressors in marine
systems,” Ecology Letters, Vol 11, No12 (2008); Edward L Miles, “On the Increasing Vulnerability of the
World Ocean to Multiple Stresses,” Annual Review of Environment and Resources, Vol34 (2009)
12 Jinhua Yu and Yuqing Wang, “Response of tropical cyclone potential intensity over the north Indian
Ocean to global warming,” Geophysical Research Letters Vol36, L03709 (2009); Doo-Sun R Park et al,
“Growing threat of intense tropical cyclones to East Asia over the period 1977-2010,” Environmental
Research Letters, Vol9, 014008 (2014); Greg Holland and Cindy L Bruyère, “Recent intense hurricane response to global climate change,” Climate Dynamics, Vol42, Nos3-4 (2014)
13 Tripartite Core Group, Post-Nargis Joint Assessment (UN/ASEAN/Government of Myanmar, July 2008),
p13, at http://yangonsitesunicnetworkorg/iles/2013/05/post-nargis_joint_assessment_all_pagespdf;
FAO, Myanmar: Emergency and Rehabilitation Program Needs Assessment for the Cyclone Nargis Afected
Areas—Agriculture (Rome: FAO, June 2008), p15; Joint Agency Brieing Note, “Rebuilding Fisheries
Communities and Fisheries: Post-Haiyan Reconstruction in the Philippines,” Oxfam/NGOs for Fisheries
Reform, 2 February 2014, at http://wwwoxfamorg/sites/wwwoxfamorg/iles/bn-isheries-reconstruction-philippines-recovery-1200214-enpdf
14 Ove Hoegh-Guldberg and Rongshuo Cai et al, “he Oceans,” in Climate Change 2014: Impacts,
Adaptation, and Vulnerability—Part B: Regional Aspects Contribution of Working Group II to the Fith
120 | SEA CHANGE
David Michel
Assessment Report of the Intergovernmental Panel on Climate Change, Vicente R. Barros et al eds
(Cambridge: Cambridge University Press, 2014), p1700, at http://wwwipccch/report/ar5/wg2/
15 Scott C Doney, “he Growing Human Footprint on Coastal and Open-Ocean Biogeochemistry,” Science
328 (1510) 2010;Bärbel Hönisch et al, “he Geological Record of Ocean Acidiication,” Science 335 (1058)
2012; Rhein and Rintoul, “Observations: Ocean”; Pörtner and Karl, “Ocean Systems”
16 Rhein and Rintoul, “Observations: Ocean”; Pörtner and Karl, “Ocean Systems”
17 See Scott C Doney et al, “Climate Change Impacts on Marine Ecosystems,” Annual Review of Marine
Science, Vol4 (2012); Keith Brander, “Climate and current anthropogenic impact on isheries,” Climate
Dynamics, Vol119, No1 (2013)
18 William WL Cheung et al, “Shrinking of ishes exacerbates impacts of global ocean changes on marine
ecosystems,” Nature Climate Change, 3 (254) 2013
19 M Aaron MacNeil et al, “Transitional states in marine isheries: adapting to predicted global change,”
Philosophical Transactions of the Royal Society B, 365 (3753) 2010; RI Perry, “Potential impacts of climate
change on marine wild capture isheries: an update,” Journal of Agricultural Science 149, Supplement S1 (2011)
20 Jean Pierre Gattuso et al, “Coral Reefs,” in Climate Change 2014: Impacts, Adaptation, and
Vulnerability—Part A, p99
21 William WL Cheung et al, “Large-scale redistribution of maximum isheries catch potential in the
global ocean under climate change,” Global Change Biology, Vol16, No1 (2010)
22 Cheung et al, “Large-scale redistribution of maximum isheries catch potential”; Sarah Harper et al,
Fisheries Catches for the Bay of Bengal Large Marine Ecosystem since 1950, Bay of Bengal Large Marine
Ecosystem/FAO, 2011
23 Pörtner and Karl et al, ”Ocean Systems,”p452
24 Matthew Huelsenbeck, Ocean-Based Food Security hreatened in a High CO2 World: A Ranking of Nations’
Vulnerability to Climate Change and Ocean Acidiication (Washington, DC: OCEANA, September 2012), p9,
at http://wwwoceanacidiicationorguk/pdf/Ocean-Based_Food_Security_hreatened_in_a_High_CO2pdf
25 Marta Coll et al, “Sustainability implications of honoring the Code of Conduct for Responsible
Fisheries,” Global Environmental Change, Vol23, No1 (2013)
26 See William R Edeson, “Overview of Institutional Arrangements for Fisheries and Marine Biodiversity
in the Indian Ocean,” in Dennis Rumley et al eds, Fisheries Exploitation in the Indian Ocean: hreats and
Opportunities (Singapore: Institute of Southeast Asian Studies, 2009); Gail Lugten, he Role of International
Fishery Organizations and Other Bodies in the Conservation and Management of Living Aquatic Resources,
FAO Fisheries and Aquaculture Circular No1054 (Rome: FAO, 2010)
27 Sarika Cullis-Suzuki and Daniel Pauly, “Failing the high seas: A global evaluation of regional isheries
management organizations,” Marine Policy, Vol34, No5 (2010); Kristina M Gjerde et al, “Ocean in peril:
reforming the management of global ocean living resources in areas beyond national jurisdiction,” Marine
Pollution Bulletin, Vol74, No2 (2013)
28 Carlyle A hayer, “Kevin Ruud’s multi-layered Asia Paciic Community initiative,” East Asia Forum, 22
June 2009, at http://wwweastasiaforumorg/2009/06/22/kevin-rudds-multi-layered-asia-paciic-community-initiative/; “Creating Community: Prime Minister Kevin Ruud Interview,” Harvard International Review,
15 June 2014, at http://hirharvardedu/archives/5817
29 Southeast Asian Fisheries Development Center, SEAFDAC Annual Report 2013 (Bangkok: SEAFDAC
2014), p5 at http://wwwseafdecorg/documents/wp02-4pdf
30 Tabitha Grace Mallory, “Fisheries in East Asia: Political, economic and security challenges,” in Routledge
Handbook of Environment and Society in Asia, Paul G Harris and Graeme Lang eds (New York: Routledge,
2015), p272
31 Chris LJ Frid and Odette AL Paramor, “Food for hought—Feeding the world: what role for isheries?”
ICES Journal of Marine Science, Vol69, No2 (2012); Gorka Merino et al, “Can marine isheries and aquaculture meet ish demand from a growing human population in a changing climate,” Global Environmental
Change, Vol22, No4 (2012)
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122 | SEA CHANGE
A Strategy for Securing the Maritime Commons
Girish Gujar, P.K. Ghosh and Hong Yan
Today, ninety percent of global trade is transported by sea1 Yet we have yet to arrive at a consensus on the appointment of a global, regional, or local constabulary to oversee the maritime
realm Nor is there a designated prosecuting authority to secure the maritime commons his
is not only an issue of resources and competency but also of mutual trust, acceptability, reliability, sustainability and motivation Assuming that the principle that the strong protect the
weak is still valid, it naturally then becomes the responsibility of the three strongest nations
today, namely China, India, and the United States to jointly accept this role
It appears that in near future, the world will witness a strong simultaneous coincidence and
conlict of interests among the above mentioned three countries his will lead to cooperation amongst them in some instances and the adoption of adversarial positions in others
here are two main reasons for this predicament he irst is the economic and military rise
of China and India, almost at the same time his will, to a certain extent, result in a strategic overlap, essentially due to the inherent global competition for markets and resources
and for global dominance he second reason is the decision of the United States to adopt a
“pivot to Asia” strategy with the explicit intention to contain the rise of China by building a
strategic alliance with India, Japan, and Australia hese events have the potential to result
in rivalry and conlict
All this is happening while the world is witnessing signiicant geo-political change We
are seeing a near collapse of good order and reigning lawlessness in nearly the entire
Middle East, North Africa, and much of Eastern Europe he US forces are pulling out of
Afghanistan, while they may re-enter Iraq to start another endless and increasingly brutal
war he resulting vacuum risks being illed with sundry warlords who will be unable to
bring stability to this region It will also have a negative impact on the surrounding countries, particularly India and China, which have signiicant Muslim populations A spillover
of the Middle Eastern wars in this economically rising region will lead to disastrous consequences for all, particularly in its economic repercussions
As such, most stakeholders believe that it becomes pragmatic for all three countries to share
the responsibilities of securing the maritime commons, particularly in Asia, which the US
(mainly) has been discharging (not very successfully and rather thanklessly) since the end of
Second World War2 It will necessarily mean clear identiication and acceptance of the consensually developed common objectives as well as enumerating and highlighting the areas
of disagreements in order to enhance cooperation while trying to simultaneously deter the
occurrence of conlicts in this region he next step would be endeavoring to develop a shortterm as well as long-term strategy, and inally preparing a roadmap to implement it
Several analysts interviewed for our research have advised that there are several such important issues demanding attention, and that they should be prioritized with the top-most
tasks being to draw a roadmap for developing a mutually beneicial tri-lateral relationship
among the three powers his paper attempts to explore this aspect by highlighting areas
of cooperation as well as those of conlict and suggesting ways and means to enhance the
one while diminishing the other
STIMSON CENTER | 123
A Strategy for Securing the Maritime Commons
Introduction
Presently the Indian Ocean is viewed as a more “active” ocean than the Atlantic and Paciic,
as it is hosting a spectrum of activities ranging from extensive trade and transportation
to important energy transfers which are quantitatively as well as qualitatively much larger
in scope and size than that which can be found in the other two oceans Given that nearly
100,000 ships transit the expanse of the Indian Ocean annually, it is a very trade-busy
ocean3 It is perhaps the only ocean through which Sea Lines of Communication (SLOCs)
( reach out to the entire world, be it those originating from the Persian Gulf with oil and
gas laden ships, or those with other cargo or commodities from the littorals, as well as
transiting ships from the Far East Signiicantly, some of the world’s most important choke
points and narrow passages provide access to the Ocean, and these can have associated
vulnerabilities
As such, the current accent on increasing globalization in the economic ield has for the
littoral nations brought attendant maritime security concerns to the fore hus, with a
rising trajectory of sea-borne trade, there seems to be a corresponding increase in asymmetric threats Incidents of maritime transnational crime like modern piracy, terrorism,
drug running, etc, in their ever evolving manifestations have emerged as the bane of
the seafarer As these maritime security challenges are essentially asymmetric in nature,
there have been strident calls for efective law enforcement and maintenance of maritime
order by all stakeholders
his growing salience of sea-borne trade and the attendant rise in transnational threats in
the region has also led to the adoption of enhanced cooperative approaches between navies
of various Indian Ocean littoral countries in the form of numerous anti-piracy patrols
which operate in the area, resulting in an eventual decrease in the number of piracy attacks
But the challenge remains as attacks continue to take place in further ranges due to the use
of sophisticated technologies by pirates and other non-state actors
It is against this backdrop that, to the old idea of collective security, concepts of common,
comprehensive, and cooperative security have been added Confusion was bound to follow
as the term is used to describe diferent things or conditions in diferent contexts he
question is less one of “What, exactly, is security?” Rather, it is perhaps better phrased as
“What are the diferent ways in which to conceive of security?” And what are the implications for policy? Because most theorizing about security has not been maritime focused, it
is essential to place the development of concepts of maritime security within the context of
the wider security debate
Buzan et al proposed that the concept of security can only be fully understood by integrating the interdependent “levels of analysis” and “issue sectors” or “dimensions”
of security4 Buzan’s levels of analysis are individual, national, and international (both
regional and system-wide) security, while his issue sectors comprise military, political,
societal, economic, and environmental security5
he Indo-Paciic region in general—and Indian Ocean Region (IOR) in particular—is a
region that is alive to political turbulence and a complex jostle for power between emerging powers rushing in to ill the perceived erosion of US primacy or inluence While the
124 | SEA CHANGE
Girish Gujar, P.K. Ghosh and Hong Yan
erosion may be notional and debatable, the tussle for power exists in that many participating major players are seeking to enhance their strategic inluence in the emerging niche they
see vacated by the US, seeking primacy along with that of US he list of serious contenders
includes India and China, with countries such as Australia, Japan, Indonesia, and South
Africa also in the fray, playing the role of a king-maker his dynamic scenario, however,
has also highlighted the distrust amongst the littorals, which in many ways has prevented
the creation of an overall security architecture despite similar security priorities and, most
importantly, a common maritime thread which runs through the region
he other reason for this struggle is geo-political We are witnessing a near collapse of
good order in the Middle East with conditions of civil war in some states he US is pulling
out its troops from the region as policy makers cannot ind any justiication for their continuing presence in an endless conlict situation he resulting vacuum will likely be illed
with sundry warlords who will be unable to bring stability to this region It will also have
a negative impact on the surrounding countries, including India and China, which have
signiicant Islamic populations A spillover of the Middle Eastern conlicts in either of these
countries would lead to disastrous consequences
However, despite the strategic divergence and competitiveness on many issues in the region,
both India and China are increasingly keen to assume the responsibilities of global policing of maritime commons which the US, so far, has been discharging ater the exit of the
British from the region in the late sixties Given that the maritime capacities of most of
the other littoral stares are inadequate, it has become incumbent on India, China, and US,
along with other capable maritime nations, to don this mantle his will necessarily mean
clearly identifying and stating the common objectives as well as enumerating the areas of
disagreements he next step would be endeavoring to develop a short-term as well as longterm strategy and preparing a roadmap to implement it
Such a strategy will necessarily have to look beyond narrow national maritime boundaries
towards the security of the global maritime commons With the US maritime power in
erosion (perceived or real), maritime disputes on the rise, and international maritime law
being increasingly tested, the world can no longer take the security and openness of the
maritime commons as a given
While there are maritime nations like India and China that have the capacity to assist in
sea governance, it must be remembered that it is of utmost importance to “carry along”
other littorals in such an efort hus multinational forums in the region come to the fore,
as they have an important role to play in this regards Maritime initiatives like Indian
Ocean Naval Symposium (IONS) started by India, and those like the Indian Ocean Rim
Association (IORA) can also be used for cooperation for overcoming issues related to
maritime security threats, thereby assisting in maintaining good order at sea and in sea
governance Similarly, the ASEAN Regional Forum (ARF), the ASEAN Defense Ministers
Meeting and Dialogue Partners (ADMM Plus), and its associated agencies (eg, the
ASEAN Maritime Forum) provide institutions which encourage cooperation However,
one of the prime lacunae has been intra-governmental cooperation, which needs to be
addressed irst, before looking across the boundaries
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A Strategy for Securing the Maritime Commons
Altered Global Environment and Global Commons
hese geo-political changes are reshaping the nature of the maritime commons he global
shit in maritime power thus harbors a strong potential for conlict and confrontation
between regional powers and could slip out of control if caution is not exercised
he main reason for this scenario is the global difusion of maritime power as a result of
the “rise of the rest,” above all, changing the geostrategic maritime balance It will result
in enabling the new entrants to project power beyond their territorial waters Inevitably,
neighboring countries will respond by strengthening their own power capacities
he enhanced focus on regional maritime zones of inluence appears to be one potential
consequence of this development, and such countries also display the intent to dominate the
weaker players within their zones For instance, China has once again sought to reinterpret
international boundaries he geography of the seas, too, is also changing in other respects,
such as the expected opening of new sea routes across the Arctic As such, it will also lead
to a greater competition for Arctic routes and Siberian energy resources India and China
have seized on this opportunity caused by reduced US imports from Latin America and
West Africa, thus resulting in a redirection of maritime lows
Figure 1: Major Security Concerns in the Indian Ocean
Source: Amit Pandaya Rupert Burns, and Junko Kobayashi, Maritime Commerce and Security: he Indian
Ocean (Washington, DC: he Stimson Center, February 2011), p98 Political boundaries projected in the
diagram are approximate)
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Girish Gujar, P.K. Ghosh and Hong Yan
In the Asia-Paciic, minor incidents commonly spark security stand-ofs and political crises, as witnessed recently between China on the one hand and Vietnam, the
Philippines, and Japan on the other Non-state actors, too, such as pirates, terrorists, and
criminal syndicates can create “events” by limiting the freedom of navigation, in particular around the Horn of Africa and West Africa his has enabled the use of private
maritime security companies (PMSCs) that has been on the rise6 he rapid growth of
private security actors has added further complexity to the situation, as lag state policies
concerning the use of armed guards vary Together, these changes make for an increasingly complex and contested international maritime region
he deep linkages of maritime terrorism and of “container security” was only realized
ater it was reported in January 2002 that the search of a vessel by US naval forces nearly
yielded a group of Al Qaeda terrorists who had been hiding inside a well-equipped shipping
container7 A dramatic increase in containerized cargo and inadequate infrastructure to
check all sealed containers led to the Container Security Initiative (CSI) and making ports
International Ship and Port Facility Security Code (ISPS) compliant, but a robust and foolproof method against such security lapses has yet to be created
Closely associated with the problem of maritime terror is that of the phantom leets which
ly the Flags of Convenience (FOC), making them diicult to track as they routinely change
names and registry FOCs, common in the shipping world despite some procedural changes,
still pose a major challenge to maritime security It is estimated that there are about 30 such
registries (some in private hands) mainly run by small islands or impoverished nations
which have loose standards for registration of ships8 While considerable work has gone
into getting these registries to become more security-oriented and rigorous as a lag state,
a lot still needs to be done
he other primary concern is that of rising maritime terrorism In the years to come, maritime terrorism is likely to manifest and evolve itself in many unique ways he use of the
seas as a supply chain link for terror attacks on land-based targets is likely to be a chosen
methodology of terror outits While the seas ensure the easy passage of men and material
for the attack, the land provides them with the publicity and number of victims unavailable
at sea Hence the constabulary functions of maritime agencies are likely to see an enhancement with the growing demand for a fool-proof coastal security system
Role of India, China, and US
India is increasingly seen as crucial to the core US foreign policy interests in the IndoPaciic region As a nascent Great Power and an “indispensable partner”, India has
emerged as an important facet of the US “pivot” or rebuilding strategy in Asia9 Since
2004, Washington and New Delhi have been pursuing a “strategic partnership” that is
based on convergent geopolitical interests In this context, the US and India signed a
“New Framework for India-US Defense” in 2005 for increasing cooperative approaches
in military relations, defense industry, and technology sharing, along with the establishment of a “Framework on maritime security cooperation”10 However it was only ater a
few crest and troughs that in June 2010 the two countries formally re-engaged with the
US-India Strategic Dialogue initiated earlier
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A Strategy for Securing the Maritime Commons
While cooperative approaches in other ields have had their own ups and downs, the ield
with maximum potential for active cooperation has been in the maritime dimension here
has been a debate that the relationship at times has “evened of to a plateau,” with Indians
feeling that the US was not doing enough to sustain its growth while the US felt that India
was too slow in taking politico-bureaucratic decisions11 Notwithstanding this debate,
newer areas of cooperation in the maritime dimension need to be highlighted to enhance
this growing cooperation In this context, several areas have the potential for greater cooperation between appropriate maritime agencies on matters regarding Maritime Domain
Awareness (MDA) he US Coast Guard has made considerable progress in harnessing
the entire gamut of MDA, while India has made unique progress in the atermath of the
Mumbai attacks of 2008 in the same ield he sharing of experiences and technology will
be a welcome step in enhancing cooperation
It is noteworthy that the main focus of any collaborative eforts between conigurations
of China, India, and the US will have to overcome certain historical disagreements and
allied strains in relations which the three countries have had over the past few decades All
the three countries would also have to make additional eforts to enhance the “maritime
bonding” between naval personnel and maritime agencies for mutual beneit hus, one
approach is to concentrate cooperation in noncontroversial areas, which would in many
ways serve as conidence building measures to enhance the bonding aspect It is also necessary to enhance personnel-to-personnel interaction at the grass roots level to increase the
mutual understanding of each country’s naval ethos, work culture, and thought processes
he geostrategic signiicance of the South China Sea (SCS) is diicult to overstate he SCS
functions as the bridge between the Western Paciic and Indian Ocean Host to important
SLOCs, it carries nearly a $12 trillion in trade annually and also supplies energy life lines
to the energy deicient states in North East Asia and China12 Half of merchant leet trade
by tonnage, and almost thirty percent of crude oil trade globally pass through the region
that provides transit between the Indian Ocean and the Western Paciic13
In the recent past, the South China Sea region has emerged as a global lashpoint and a
major maritime challenge, not only for the littorals and the contending states but for all the
users and the stakeholders as well In this volatile region, many claimant states have started
resorting to aggressive posturing to reinforce their sovereignty over disparate islands and
“rocks” he simmering disputes and the resort to brinkmanship pose a serious threat to
the peace and stability of the region Unfortunately, the current, disenchantment with
multilateral fora like ASEAN to ind an amicable solution seems to be on the rise, making
it imperative for external stakeholders to try and ind peaceful solutions or enhance conidence amongst the parties
As such, India, China, and US can and should play a stabilizing and an encouraging role by
being active participants in some of the conidence building measures Ater all, all three
share the aim of maintaining peace and stability while ensuring the freedom of navigation
and unhindered access to the movement of shipping trade across the region
It is obvious that the above stated maritime threats and challenges afecting the region as
a whole can only be overcome partially or fully through expanded cooperation However,
maritime cooperation between the three countries cannot be placed the same level
128 | SEA CHANGE
Girish Gujar, P.K. Ghosh and Hong Yan
uniformly While India and US on one hand, and the US and China on the other, do share
a closer maritime bonding, the impetus for forming a closer bond between India and China
is relatively nascent Hence it would be appropriate to discuss the issue irst under separate
headings at the bilateral level between the countries and later at the trilateral level
he two developing giants, India and China, share a number of common strategic objectives that revolve around the keenness to deine their roles in the evolving geo-strategic
dynamics of the region given their inluence on global economics afairs Both countries
promote the cause of a multi-polar world, and both would prefer to be recognized as major
international players alongside the United States But at the same time, both would like to
maintain their sovereign independence from outside inluences that could be a legacy of
the unhappy colonial experiences
China and India had earlier shared a subterranean adversarial relationship but have recently
been making history by starting to come together on the high seas for structured naval exercises his move is a reiteration of the dictum that opportunities for symbiotic cooperation
at sea are oten more beneicial than those on land Consequently, the continuing series of
Sino-Indian Naval exercises in the seas of Shanghai or of Indian coasts add considerable
impetus to the developing relationship.
At one level, these basic search and rescue (SAR) and other exercises between the Indian
Navy and the People’s Liberation Army Navy (PLAN) foster the general bilateral relationship and encourage “maritime closeness” between the naval forces At another level, they
provide each navy an opportunity to assess the professional capability of the other Yet
another aspect of the relation allows a degree of interoperability to develop, though this is
essentially rudimentary since the working ethos of the two institutions are totally diferent
Training is the basis of all operations at sea While there has been some exchange of training for military oicers at the senior levels between the two countries (with Indian Naval
oicers attending the National Defence College courses in Beijing), the practice needs to
be broader based It is advisable that both navies work out programs for training mid-level
personnel in non-sensitive, non-controversial subjects like hydrography (in which Indian
Navy has expertise) engineering, etc However, given the slow progress of cooperative steps
being taken, it may take time to see mid-level Chinese naval oicers in Indian training establishments or vice versa
Finally, it becomes imperative to state that the main focus of such an eventual trilateral
efort will be to overcome adversarial strains of relations which the two countries – India
and the US – share with China and enhance the “maritime bonding” between naval personnel and maritime agencies for mutual beneit hus, the accent is to keep the cooperation restricted to noncontroversial areas, which would in many ways serve as conidence
building measures to enhance the bonding aspect
Conclusion
Maritime challenges and threats in the Indo Paciic region have been on the rise in recent
years and have the potential to create serious impediments to the exercise of freedom of
the seas, thus afecting sea-borne trade in the region Additionally, these threats have also
spawned a multitude of “out of area operations,” which has entailed additional roles for the
STIMSON CENTER | 129
A Strategy for Securing the Maritime Commons
littoral navies Countering these threats and challenges requires cooperation and sensitivity
to security concerns of other countries, a quality that is diicult to achieve with the level of
existing trust between states he US, an Indo Paciic power along with India, and China
are the primary maritime nations that have a responsibility to help other littoral states
towards capacity building and ultimately towards maintenance of “maritime good order”
in the region
Unfortunately, the current state of relations belies the underlying sense of mistrust that
China holds toward the other two states In this context, it is necessary that a matrix of cooperation be evolved which would enhance “maritime bonding” at various levels between
the maritime agencies and the navies his cooperative approach would also serve as a de
facto conidence building measure between the three countries his has been evidenced
by the current cooperative eforts in combating Somalian piracy singly, bilaterally, and
multi-laterally in the Horn of Africa Such measures and methods would not only help in
overcoming the challenges and threats in the oceanic dimension but ensure the freedom
of navigation for the trade lows, bringing together maritime minded countries to enlarge
the brotherhood of the seas
130 | SEA CHANGE
Girish Gujar, P.K. Ghosh and Hong Yan
About the Authors
Girish Gujar is Visiting Lecturer in the Department of Logistics and Maritime Studies at
he Hong Kong Polytechnic University He has extensive sea-faring experience, having
served as marine engineer oicer on numerous sea-going vessels of diferent kinds for over
a decade Subsequently he gained further experience in dry port operations and hinterland
transport for over 15 years in India, the Middle East and Europe For the past 8 years he has
been teaching various subjects at the Department of Logistics and Maritime Studies at the
Hong Kong Polytechnic University to under- and post-graduate students He has published
extensively in reputed peer reviewed journals and is a regular speaker at prestigious international conferences His research interests include port economics, dry port development,
competition regulation, and container security He has also published two books: Essays
on Dry Ports, and Shipping Today Currently he is working on a book on new paradigms of
supply chain security, which is expected to be published by Routledge in August 2014 He
received a PhD and Masters’ Degrees in Financial Management and Maritime Economics
and Logistics from Erasmus University Rotterdam, and completed his Bachelor’s degrees
in Science and Law from the Bombay University
PK Ghosh is presently a Senior Fellow at the Observer Research Foundation (ORF) in New
Delhi He was the Co-Chair and India Representative to two consecutive CSCAP International
Study Groups on Maritime Security (CSCAP – Council for Security Cooperation in Asia
Paciic Region is the Track II version of the ASEAN Regional Forum – ARF) Dr Ghosh
retired from the Indian Navy ater 28 years of commissioned service A graduate of the
National Defence Academy, he has done post-graduate work in Telecommunications and
wrote his doctoral thesis on International Relations Prior to joining the ORF as a Senior
Fellow, he served as a Research Fellow at the Institute for Defence Studies and Analyses
(IDSA) for two tenures (2000- 2004), ater which he was awarded the prestigious Prof DS
Kothari DRDO Chair (2004-05) at the USI (United Services Institution) He is the Founder
Member of the National Maritime Foundation (NMF) and was its Senior Fellow from inception until December 2008 He was the Senior Fellow at the Centre for Air Power Studies
(CAPS) from January 2009 to January 2010 A SEAS Fellow (2010) and an Alumni of APCSS
Hawaii, he was the coordinator of the major Indian maritime initiative IONS (Indian Ocean
Naval Symposium) that he helped in conceptualizing from scratch He has lectured extensively around the globe and written on issues connected with maritime security, asymmetric threats, capacity building, Chinese maritime capability, and Ballistic Missile Defense
Hong Yan is Professor and Director of the Laboratory for Container Security in the
Department of Logistics and Maritime Studies at he Hong Kong Polytechnic University
Hong Kong He received a Bachelor of Science degree in mathematics from Sichuan
University in China, Master of Engineering degree in information management from the
Electro-Communication University in Japan, and a Master of Science degree in operations
research and PhD in industrial administration from Carnegie Mellon University in the US
His teaching and research interests cover logistics and supply chain management, operations research and operations management, shipping and port management, and environmental management He has published more than 100 research papers in various academic
journals and several books He has also participated in many diferent government and
industrial consulting projects
STIMSON CENTER | 131
A Strategy for Securing the Maritime Commons
Notes
1 United Nations Environmental Program, International Trade Centre, and International Centre for Trade
and Sustainable Development, “Trade and Environment Brieings: International Transport,” (2012), http://
wwwuneporg/greeneconomy/Portals/88/documents/research_products/PolicyBriefs/international-transportpdf
2 David Brewster, “An Indian Sphere of Inluence in the Indian Ocean?” Security Challenges, Vol20, No4
(2010), pp1-20, at http://wwwsecuritychallengesorgau/ArticlePDFs/vol6no3Brewsterpdf
3 Probal Ghosh, “Security Challenges from Non-State Actors in the Indian Ocean,” Strategic Trends,
Vol1, No3 (2011), p3, at http://orfonlineorg/cms/export/orfonline/modules/issuebrief/attachments/st_
issue3_1374141600044pdf
4 Barry Buzan, Ole Waever, and Jaap de Wilde, Security: A New Framework for Analysis (Boulder, CO:
Lynne Reinner, 1998)
5 Ibid
6 David Isenberg, “he Rise of Private Maritime Security Companies,” Somalia Report, 26 May 26 2012, at
http://wwwsomaliareportcom/indexphp/post/3380/he_Rise_of_Private_Maritime_Security_Companies
7 Vijay Sakhuja, “Maritime Terrorism: India Must Be Prepared,” Faultlines 12 (2002), at http://wwwsatp
org/satporgtp/publication/faultlines/volume12/Article4htm
8 “Flags of Convenience,” International Transport Worker’s Federation, 2014, at http://wwwitfglobalorg/
en/transport-sectors/seafarers/in-focus/lags-of-convenience-campaign/
9 Yashwant Raj, “Kerry Lays Stress on Modi’s ‘sab ka saath, sab ka vikaas’ Growth Slogan,” Hindustan
Times, 29 July 2014, at http://wwwhindustantimescom/world-news/kerry-harps-on-modi-s-development-mantra-says-deepening-ties-with-india-is-strategic-imperative/article1-1245738aspx; Nicholas Burns,
“Passage to India: What Washington Can Do to Revive Relations with New Dehli,” Foreign Afairs, Vol93,
No5 (2014), at http://wwwforeignafairscom/articles/141851/nicholas-burns/passage-to-india
10 United States Department of Defense, “US – India Defense Relationship Fact Sheet,” (March 2006), at
http://wwwdefensegov/news/Mar2006/d20060302us-indiadefenserelationshippdf
11 Brewster, “An Indian Sphere of Inluence,” 1-20
12 Admiral Robert Willard, Press Brieing (Moana Surfrider Hotel, Honolulu, 13 November 2011),
at http://wwwwhitehousegov/the-press-oice/2011/11/13/press-brieing-nsa-strategic-communications-ben-rhodes-and-admiral-rober
13 US Energy Information Administration, “South China Sea Analysis Brief,” (February 2013), at http://
wwweiagov/countries/analysisbriefs/South_China_Sea/south_china_seapdf
132 | SEA CHANGE
About Stimson
About Stimson
he Stimson Center is a nonproit and nonpartisan think tank that inds pragmatic solutions to global security challenges Stimson’s work has spanned over 25 years of pragmatic
research and policy analysis to:
• Reduce nuclear, environmental and other transnational threats to global,
regional and national security
• Enhance policymakers’ and the public’s understanding of the changing
global security agenda
• Engage civil society and industry in problem-solving to help ill gaps in
existing governance structures
• Strengthen institutions and processes for a more peaceful world
Stimson is efective and innovative It develops path-breaking approaches to non-conventional challenges such as water management, wildlife poaching and responses to humanitarian crises At the same time, Stimson plays a key role in debates on nuclear proliferation,
arms traicking and defense policy he MacArthur Foundation recognized Stimson in
2013 with its “institutional genius” Award for Creative and Efective Institutions Stimson
is funded by research contracts, grants from foundations and other donations For more
information, visit www.stimson.org
Environmental Security Program
he Environmental Security Program explores how rising stresses on global ecosystems and shared natural resources may compromise economic development, fuel social
conlict, and undermine political stability in key areas throughout the world Working
with governments, researchers, civil society organizations, and the private sector,
Stimson seeks to provide policy-relevant analysis, promote useful knowledge-sharing,
build partnerships, and forge pragmatic policy solutions that ensure the sustainable
governance of environmental resources and the reduction of environmental risks In
parallel, Stimson engages with local stakeholders and constituencies to build institutional structures that allow for public deliberation and participatory decision-making, tackling such issues as integrated water resources management, disaster preparedness, and climate mitigation and adaptation in environmentally-stressed regions of
the globe For more information on the Environmental Security Program, please visit
http://www.stimson.org/programs/environmental-security
134 | SEA CHANGE
A Strategy for Securing the Maritime Commons
SEA CHANGE
EVOLVING MARITIME GEOPOLITICS IN THE INDO-PACIFIC REGION
The Indo-Pacific region is rapidly emerging as a key focus of maritime
geopolitics. The Indian Ocean and Western Pacific represent an
increasingly critical avenue for world trade and arena for international
security. Accelerating communications and expanding economic
exchanges are fueling vital global growth and driving beneficial regional
integration. At the same time, persistent problems ranging from piracy
on the open ocean to territorial disputes in the regional seas and
intensifying environmental pressures on marine and coastal infrastructure
and resources, pose significant governance challenges for policymakers
around the Indo-Pacific littoral.
Sea Change: Evolving Maritime Geopolitics in the Indo-Pacific Region,
the result of a collaboration between the Stimson Center in the US and
India’s Observer Research Foundations in India, seeks to elucidate the
interconnecting strategic, socio-economic, commercial, energy, and
environmental trends affecting the region and explore their implications
for decision makers. It examines the strategic outlooks and objectives
of major states, the shifting maritime security risks facing them, the
institutional and legal structures in place to meet such challenges, the
dynamics of Indo-Pacific maritime shipping and energy trade, as well
as the rising strains on environmental and natural resource issues and
the role and politics of regional organizations. Finally, it offers practical
recommendations to help policy makers achieve the promise and avoid
the potential pitfalls embodied in the region’s ongoing rise to prominence.
www.stimson.org
136 | SEA CHANGE