Towards a New World Order in Eurasia: The 21st Century’s Great Game

Abstract

The 21st century’s Great Game is about the creation of a new Eurasia-centred world. It locks China, Russia, India, Japan and Europe into what is an epic battle. Yet, they are not the only players. While US President Donald J. Trump’s policies are still largely shrouded in mystery, early indications suggest a closer alliance with India in a bid to counter potential Chinese dominance.

Middle Eastern rivals, Saudi Arabia and Iran, are key players too. As they vie for big power favour, they compete to secure the ability to shape the future architecture of Eurasia’s energy landscape, enhance leverage by increasing energy and oil product market share, and position themselves as the key nodes in infrastructure networks.

With China and a US-backed India as the heavy weights, the Great Game is unlikely to produce an undisputed winner. Nor do key players perceive it as a zero-sum-game. The stakes in the game are about ensuring that China despite its vast resources, economic leverage, and first starter advantage in infrastructure linkage, does not emerge as the sole dominant power in Eurasia’s future architecture.

For players, such as Europe, Russia and Japan, the game is about ensuring that they remain influential stakeholders. Efforts to restrain China’s rise are enhanced by growing anti-China resentment in key nodes of the Middle Kingdom’s 65-nation, $3 trillion One Belt, One Road initiative1 and increased questioning of China’s business practices.

Some of the alliances in the shaping of Eurasia’s future are opportunistic rather than strategic. This is particularly true for Russian ties to China and Iran. The contours of potential conflicts of interest are already evident and likely to impact the degree to which China will have a free reign.

A game of Risk

The game’s outcome is unpredictable. Economic power, population size, assertiveness, and military might are key factors but may not be enough for China to become the unrivalled dominant power in Eurasia. It will, however, no doubt be a player. One Belt, One Road virtually guarantees that with a budget projected to be 12 times what the United States spent on its history-changing Marshall Plan that helped Western Europe rise from the rubble after World War Two. Nonetheless, the question is how multi-polar Eurasia will turn out to be.

Predicting how the game will end is complicated by volatility, instability and uncertainty that has sparked violence and widespread discontent across a swath of land that stretches from the Mediterranean into the deep recesses of Asia. The violence and discontent complicates China’s grandiose plans for infrastructure and economic zones designed to tie Eurasia to the Middle Kingdom, threatens Russian aspirations to position itself as a global rather than a regional power, and scares off risk-adverse investors.

The game resembles Risk, a popular board game. Multiple players engage in a complex dance as they strive for advantage and seek to compensate for weaknesses. Players form opportunistic alliances that could change at any moment. Potential black swans threaten to disrupt. The stakes, however, could not be higher.

Wracked by internal political and economic problems, Europe may not have the wherewithal for geopolitical battle. Yet, despite a weak hand, it could come out on top in the play for energy dominance. US backing of India in the Great Game and efforts to drive wedges into mostly opportunistic alliances such as cooperation between China and Russia and Russia and Iran could help Europe compensate for its weakness.

The Great Game is played not only in Eurasia but across the world map.2 Like Risk, it is a game that not only aims to achieve dominance of infrastructure and energy, but also to reshape political systems at a time that liberal democracy is on the defensive and populism is growing in appeal.

Players like China and Russia benefit from the rise of populism, authoritarianism, and illiberal democracy. Russia, tacitly backed by China, has sought to harness the new winds by attempting to undermine trust in Western democratic structures, manipulate elections, and sew domestic discord in the West Populism and the Trump administration’s economic nationalism have, in a twist of irony, allowed China, led by a Communist party, to project itself as a champion of free trade and globalization.3

Suggestions that Russian President Vladimir Putin was bent on undermining Western democratic institutions were initially viewed as a crackpot conspiracy theory. Yet, the notion has gained significant currency against a backdrop of assertions that Russia is waging a cyber war against the West. The United States has accused Russia of interfering in its electoral process.4 German intelligence has sounded alarm bells about Russian efforts to manipulate public opinion.5 Putin couldn’t supress a smirk when French National Front leader Marie Le Pen visited him in 2017 weeks before French elections in which a Russian bank loan had helped fund her campaign.6

East European leaders fear Russian bullying and encroachment.7 Whether conspiracy theory or not, western intelligence agencies and analysts see a pattern in Russian moves that would also serve Chinese interests. That would be particularly true if the United States under Trump steps back as a guarantor of the international order and de-emphasizes US promotion of democratic values and human rights.

Undermining confidence in democratic structures legitimizes Russian and Chinese efforts to rebalance global geopolitical power arrangements. They are aided by the fact that relations between the United States and many of its allies are testy. Trump’s apparent affinity to illiberal and authoritarian leaders like Turkish president Recep Tayyip Erdogan does not stop them from gravitating towards Moscow and Beijing.

Erdogan, who has repeatedly accused the West of supporting a failed coup attempt in July 2016 as well as a mysterious international financial cabal that allegedly seeks to undermine the Turkish economy, has applied for Turkish membership in the Shanghai Cooperation Organisation (SCO) that groups Central Asian states with China and Russia.8 Bent on enhancing his personal power, Erdogan is not about to fully rupture relations with the West anchored in Turkish membership in NATO and the European Council. But he is happy to play both ends against the middle by publicly aligning himself with Russian-backed Eurasianists. Iran, whose relations with the United States have worsened since the rise of Trump, is already aligned with Russia and China.

The notion of a Eurasian-dominated world order was initially propagated in Turkey by Dogu Perincek, a left-wing secularist who spent six years in prison for allegedly being part of a military-led cabal that sought to stage a coup. Perincek has since become a player in Turkey’s hedging of its bets. Together with the deputy leader of his Homeland Party, Ismail Hakki Pekin, mediated the reconciliation between Moscow and Ankara following the Turkish air force’s downing of a Russian fighter in 2015. The two men were supported by Turkish businessmen close to Erdogan and ultra- nationalist Eurasianist elements in the military.9 Pekin is a former head of Turkish military intelligence with extensive contacts in Moscow that include Putin’s foreign policy advisor, Alexander Dugin.

Eurasianism in Turkey was buoyed by increasingly strained relations the Erdogan government and the West. Erdogan has taken issue with Western criticism of his effort to introduce a presidential system that would grant him almost unlimited power. He has also blasted the West for refusing to crack down on the Hizmet movement led by exiled imam Fethullah Gulen, whom Erdogan holds responsible for the unsuccessful coup.10 Differences over Syria have intensified pro-Eurasianist thinking.

Circumventing sanctions

Turkey’s embrace of the Eurasianist idea takes on added significance with Russia and the European Union slapping sanctions on each other because of the dispute over Russian intervention in Ukraine.11 The EU sanctions halted $15.8 billion in European agricultural supports to Russia.12

Russian countermeasures prevent shipment of those products via Russia to China.

To solve their problem, China and Europe have focused on an alternative route that would bypass the Russian landmass, which stretches from the Bering Sea to the Baltics.13 Turkey as well as Caucasian and Central Asian nations, eager to seize the opportunity, fast-tracked port projects in the Azerbaijani capital of Baku, Poti in Georgia, Aktau in Kazakhstan, and Turkmenbashi in Turkmenistan as well as a rail line linking Baku and the Georgian capital of Tbilisi with Kars in eastern Turkey.14

The sanctions notwithstanding, Russia and China appear so far to be scoring the most points in the Great Game. They have benefitted from the rise of populism in an era of defiance and dissent in which significant segments of the public in the West and beyond no longer have confidence in traditional politics or leaders. To cement their gains, Russia and China will have to go beyond focusing on geopolitics, public diplomacy and cyberwarfare. They will have to address concerns of disaffected social groups who feel marginalized by globalization and shun aside by elites. Already, much like traditional politicians in the West, China is encountering resistance. Its massive investments frequently generate opposition by population groups that feel left out.

China is nevertheless better positioned than Russia to meet Eurasia’s infrastructural needs despite the fact that has deep historical and cultural roots in Central Asia and the Caucasus. Moreover, Russia’s strategic assets are also liabilities. Even without European sanctions and counter sanctions, rail transport through Russia is easier said than done. Using Russian rail with its unique gauge increases cost and makes linkages south of the Russian border more attractive.

Russia is nonetheless working to connect Moscow and Beijing by high-speed rail that would cut travel time to a mere two days.15 Russia has also expressed interest in linking its Trans-Siberian Railway to the Chinese-controlled Pakistani port of Gwadar.16

To further hedge its bets and bolster its leverage, Russia has forged strategic ties to China and partnered with China in areas such as aerospace, science, and finance.17 Russia has also sought hook- ups to Chinese networks where possible and struck energy, commodity and construction deals beyond Eurasia with Middle Eastern and North African nations such as Iraq, Iraqi Kurdistan, Egypt, and Libya. Russia was considering bidding for offshore drilling rights in Lebanon.18 In Libya, Russia

has politically and militarily supported General Khalifa Hafta, who is fighting a United Nations-backed government that Western states see as the vehicle to restore stability.19 Forces loyal to Haftar captured in 2017 key oil-rich areas of eastern Libya and associated ports.20 Russian intervention appears to acknowledge de facto partition of Libya.

Like with China, the longevity of Russia’s alliance with Iran is far from certain. Iranian-Russian competition is already visible in Syria,21 the Caucasus and Central Asia. How Iran deploys its strategic advantage in determining Eurasia’s energy infrastructure is likely to feed into a potential divergence of Chinese and Russian interests. Strains in relations with Iran could complicate another Russian hedging strategy: projecting Russia as the go-to-mediator in the Middle East. Russia believed it had a strategic advantage, particularly with Iran, given that it, unlike the United States, had good relations with all the region’s players.22

Recognizing opportunities, Gulf states have sought to ensure that Russia has a greater stake in their survival by digging into their deep pockets to invest at a time when Moscow’s embattled economy struggles with lower oil prices. Qatar’s investment arm, the Qatar Investment Authority (QIA), bought in a joint venture with Swiss oil trader Glencore a 19.5 percent stake in Russia’s state-owned oil group Rosneft. The stake was worth an estimated $11 billion.23

Qatar, Saudi Arabia, and the UAE, additionally put tens of billions of dollars into Russia’s sovereign wealth the Russian Direct Investment Fund (RDIF).24 The UAE has, moreover, bought Russian military equipment and services, including anti-armour missiles, training and support for $1.9 billion. It also agreed to develop together with Russia a fifth generation, joint light fighter aircraft while a consortium of Middle East investors acquired a 12 percent stake in defense manufacturer, Russian Helicopters.25

Microcosms of the Great Game

A microcosm of the Great Game is being played out a mere 70 kilometres west of Gwadar with Iran’s southernmost port city of Chabahar having become the focal point of Indian efforts to circumvent Pakistan in its access to energy-rich Central Asia. India sees Chabahar as its Eurasian hub linking it to a north-south corridor that would connect it to Iran and Russia. Investment is turning Chabahar into Iran’s major deep water port beyond the Strait of Hormuz that is populated by Gulf states hostile to the Islamic republic. Chabahar would also allow Afghanistan to break Pakistan’s regional maritime monopoly.

Gwadar and Chabahar have much in common. Both are long neglected, sleepy Indian Ocean port towns that lived off minor trade and have been given a potential new lease on life as trans-national chokepoints backed by regional rivals. The current Great Game has echoes of the 1970s when the Soviet Union looked at Gwadar as a possible naval base and the United States weighed similar plans for Chabahar. Instability in Pakistan dissuaded the Soviets while the Islamic revolution in Iran thwarted US aspirations.

Instability may, however, prove to be Gwadar’s Achilles Heel in a competition with Chabahar in which at first glance the cards are stacked in the Pakistani port’s favour. Indian investment dwarfs that of China while China’s engagement with Gulf states outstrips that of India. For geopolitical as well as commercial reasons, potential Gulf investment in refineries and pipelines is likely to target Gwadar, Asia’s deepest natural harbour, rather than Chabahar. Pakistan licensed Kuwait Petroleum Corporation (KPC) in 2016 to build a refinery near Gwadar26 and six months later agreed that Kuwait would construct a petroleum products pipeline from Karachi to north of the country.27

Pakistan will have to manoeuvre nimbly to avoid the pitfalls of the rivalry between Saudi Arabia and Iran as it plays out in the Indian Ocean. Iran has a vested interesting in connecting Chabahar and Gwadar and has found an ally in the foreign affairs committee of the Pakistani senate. The foreign affairs committees of the two parliaments planned joint visits in 2017 to Gwadar as well as Chabahar to emphasize that the two would complement rather than compete with one another.28

Security and political threats to China’s One Belt, One Road initiative stretch far into Gwadar’s hinterland. The first freight train traversing the newly inaugurated Sino-Afghan Special Transportation Railway that links the Yangtze River port of Nantong with the Afghan river port of Hairatan ran into political problems on its maiden voyage.29

The train brought Chinese electrical supplies, clothing and other goods to Afghanistan but returned to China empty. Uzbek officials refused to allow Afghan goods to traverse their country charging that the train could be used to smuggle narcotics and precious stones, which fuel criminal and terrorist networks in the region.

Afghanistan supplies most of the world’s opium, made from poppies, and about a quarter of that is trafficked to global markets through Central Asia. The crop is mostly grown in insurgent-held areas and is a major source of revenue for the Taliban and other militant groups. Production rose more than 40% in Afghanistan last year, according to the United Nations.30

The Uzbek action, however, reflects deeper concerns. Uzbekistan, despite a raft of deals worth $6 billion, fears that it may feature primarily as a link in railways connecting China to Europe rather than as a partner with a real stake in the game. It also highlighted the fact that regional tensions and lack of trust threaten to increase rather than decrease travel time and cost of shipping goods across Eurasia.

Similarly, a $3 billion acquisition in 2007 by China Metallurgical Group Corp of a 30-year concession to a huge copper deposit south of Kabul, along with a concession in 2011 for oil and gas blocks in the north, has largely remained idle because of turmoil in Afghanistan. Security concerns have for all practical matters called into question China belief that economic engagement will substitute stability for volatility. China’s economic footprint in Afghanistan despite the investment remains miniscule. Afghan exports are primarily geared toward Pakistan, Iran and India. Similarly, Chinese trade with the Central Asian nation is negligible. To complicate things, Pakistan in February 2017 closed its border with Afghanistan, accusing Kabul of hosting militants who caused havoc in Pakistani cities with a wave of suicide bombings.31

Expanding security engagement

Diverging Chinese and Russian interests remain for now muted. The rise of populism, economic nationalism, and a reduced Western focus on human rights is likely to keep their interests aligned at least for the immediate future. Those interests, however, are potentially threatened by emerging Chinese-Russian rivalry in Central Asia, greater Chinese engagement in security beyond its borders and mounting anti-Chinese sentiment across Eurasia.

Chinese concerns about unrest in Xinjiang and fears that violence in Pakistan and Afghanistan could spill into the resource-rich and militarily strategic province that is China’s gateway to Central Asia has already prompted China to move beyond its traditional reluctance to engage militarily beyond its borders. Those concerns have also sparked fears in some Chinese government agencies such as the ministry of public security and authorities in Xinjiang that One Belt, One Road’s integration of the province with its Muslim hinterlands in Central and South Asia would fuel rather than undermine Uighur religiosity and nationalism.32

China by now, has, however, too much at stake in One Belt, One Road for it to back away. Protection of Chinese investment and personnel rather than retrenchment is the name of the game. In a rare cross border operation, China sent personnel and military vehicles in 2016 to patrol the Wakhan Corridor, Afghanistan’s eastern tongue that barely touches China’s borders. The patrols suggested that China expanded beyond providing military aid to the tune of $70 million Afghanistan and training of security forces to conducting counter-terrorism operations.33

Chinese engagement on the Afghan side of the border as well as closer military cooperation with Tajikistan appeared to be driven by concern in Beijing that Uyghur militants had moved from Pakistan into Badakshan, a region in northern Afghanistan that borders on China and the Central Asian state. The engagement also constitutes a response to President Barak Obama’s drawdown of US forces in Afghanistan and uncertainty over what policy Trump would pursue.

Jonny, a blogging traveller, reported encountering Afghan, Chinese and Tajik soldiers at a military checkpoint in Little Pamir in October 2016. “We had a fun adventure hanging with Afghan commanders, Chinese military and Tajik soldiers,” Jonny wrote.34 The encounter served as a first indication that a Chinese proposal for four-nation security bloc that would include Pakistan, Afghanistan and Tajikistan was taking shape.35 The grouping would compete with the Russia-led Collective Security Treaty Organization (CSTO). Tajikistan, like Kyrgyzstan home to a Russian military base, is already a CSTO member. The presence of Chinese forces in Afghanistan suggested a broadening of the definitions of China’s foreign and defense policy principle of non-interference in the internal affairs of others. The Chinese units reportedly crossed twice a month from Tajikistan into Afghanistan.36

The patrols fit an emerging pattern of China using law enforcement and its mushrooming private security industry for counter-terrorism and anti-crime operations beyond its borders. Chinese and Pakistani special forces held a joint military exercise in November 2016 in a bid to strengthen cooperation in countering political violence.37 Similarly, the Afghan patrols resembled joint police operations with Laos, Myanmar and Thailand along the Mekong river38 and border controls in Central Asia in cooperation with Kyrgyz, Kazakh and Tajik forces. Chinese private security companies were also expanding operations in and around Gwadar.39

China created the legal basis for cross-border operations with the adoption in 2015 of an anti- terrorism law that allows the government to deploy troops beyond the country’s frontiers.40 The Chinese defense ministry nonetheless indicated that the patrols in Afghanistan were being carried out by private security companies with close ties to the Chinese military rather than by the People’s Liberation Army itself.41 Greater Chinese engagement in Afghan security reflected concern in Beijing of the fallout of Obama’s withdrawal of the bulk of US forces from Afghanistan.

China’s new assertiveness signalled a potential first step toward restructuring of tacit understandings whereby Russia acted as Central Asia’s security guarantor while China focused on regional economic development. Paving the road to greater assertiveness that would put China in competition with Russia was Beijing’s first arms sales to Central Asian nations, including its HQ-9 air defence system to Uzbekistan and Turkmenistan. China also supplied Pterodactyl drones to Uzbekistan.42

Chinese plans to increase its marine corps five-fold from 20,000 to 100,000 men would allow it to station more of its own military personnel in Gwadar as well as in Djibouti, home to China’s first overseas military facility at the crossroads of key trade routes linking Asia, Africa, the Middle East and Europe. “Besides its original missions of a possible war with Taiwan, maritime defence in the East and South China seas, it’s also foreseeable that the PLA Navy’s mission will expand overseas, including…offshore supply deports like in Djibouti and Gwadar port in Pakistan,” said Liu Xiaojiang, a former navy political commissar.43

A visit to Central Asia by Putin in early 2017, signalled Russia’s intention to stand its ground against what it saw as encroachment on its military position in the region.44 Putin’s focussed on security rather than on the Russian-led Eurasian Economic Union that Tajikistan has wanted to join. CSTO and Russian bases in Central Asia are central to Moscow’s efforts to counter Islamic militancy in Afghanistan as well as drug trafficking. In Dushanbe, Putin announced that Russian troops would again be patrolling Tajikistan’s border with Afghanistan.45

Chinese concerns about unrest in Xinjiang and fears that violence in Pakistan and Afghanistan could spill into the resource-rich and militarily strategic province that is China’s gateway to Central Asia has already prompted China to move beyond its traditional reluctance to engage militarily beyond its borders. In a rare cross border operation, China sent personnel and military vehicles in 2016 to patrol the Wakhan Corridor, Afghanistan’s eastern tongue that barely touches China’s borders. The patrols suggested that China expanded beyond providing military aid to the tune of $70 million Afghanistan and training of security forces to conducting counter-terrorism operations.46

Chinese engagement on the Afghan side of the border as well as closer military cooperation with Tajikistan appeared to be driven by concern in Beijing that Uyghur militants had moved from Pakistan into Badakshan, a region in northern Afghanistan that borders on China and the Central Asian state. The engagement also constitutes a response to President Barak Obama’s drawdown of US forces in Afghanistan and uncertainty over what policy Trump would pursue.

Jonny, a blogging traveller, reported encountering Afghan, Chinese and Tajik soldiers at a military checkpoint in Little Pamir in October 2016. “We had a fun adventure hanging with Afghan commanders, Chinese military and Tajik soldiers,” Jonny wrote.47 The encounter served as a first indication that a Chinese proposal for four-nation security bloc that would include Pakistan, Afghanistan and Tajikistan was taking shape.48 The grouping would compete with the Russia-led Collective Security Treaty Organization (CSTO). Tajikistan, like Kyrgyzstan home to a Russian military base, is already a CSTO member. The presence of Chinese forces in Afghanistan suggested a broadening of the definitions of China’s foreign and defense policy principle of non-interference in the internal affairs of others. The Chinese units reportedly crossed twice a month from Tajikistan into Afghanistan.49

The patrols fit an emerging pattern of China using law enforcement and its mushrooming private security industry for counter-terrorism and anti-crime operations beyond its borders. Chinese and Pakistani special forces held a joint military exercise in November 2016 in a bid to strengthen cooperation in countering political violence.50 Similarly, the Afghan patrols resembled joint police operations with Laos, Myanmar and Thailand along the Mekong river51 and border controls in Central Asia in cooperation with Kyrgyz, Kazakh and Tajik forces. Chinese private security companies were also expanding operations in and around Gwadar.52

China created the legal basis for cross-border operations with the adoption in 2015 of an anti- terrorism law that allows the government to deploy troops beyond the country’s frontiers.53 The Chinese defense ministry nonetheless indicated that the patrols in Afghanistan were being carried out by private security companies with close ties to the Chinese military rather than by the People’s Liberation Army itself.54 Greater Chinese engagement in Afghan security reflected concern in Beijing of the fallout of Obama’s withdrawal of the bulk of US forces from Afghanistan.

China’s new assertiveness signalled a potential first step toward restructuring of tacit understandings whereby Russia acted as Central Asia’s security guarantor while China focused on regional economic development. Paving the road to greater assertiveness that would put China in competition with Russia was Beijing’s first arms sales to Central Asian nations, including its HQ-9 air defence system to Uzbekistan and Turkmenistan. China also supplied Pterodactyl drones to Uzbekistan.55

Chinese plans to increase its marine corps five-fold from 20,000 to 100,000 men would allow it to station more of its own military personnel in Gwadar as well as in Djibouti, home to China’s first overseas military facility at the crossroads of key trade routes linking Asia, Africa, the Middle East and Europe. “Besides its original missions of a possible war with Taiwan, maritime defence in the East and South China seas, it’s also foreseeable that the PLA Navy’s mission will expand overseas, including…offshore supply deports like in Djibouti and Gwadar port in Pakistan,” said Liu Xiaojiang, a former navy political commissar.56

Shaping Eurasia’s energy architecture

The joker in the Great Game is Donald J. Trump’s United States. Trump has yet to spell out an overall policy towards Eurasia even though he has articulated attitudes towards individual players. One of those players, Iran, appears to be on his hitlist, much to Saudi Arabia’s delight.

A tougher US policy towards Iran, a nation of strategic importance to several of the Great Game’s players, has consequences and could undercut the Islamic republic’s strategic advantage in shaping the future architecture of Eurasia’s energy landscape. Unfettered by international sanctions, Iran is pivotal to the success of China’s trans-continental, infrastructure-focussed One Belt, One Road initiative in ways that Saudi Arabia is not.

In a study published in 2015, energy scholar Micha’el Tanchum suggested that it would be gas supplies from Iran and Turkmenistan, two Caspian Sea states, rather than Saudi oil that would determine which way the future Eurasian energy architecture tilts: China, the world’s third largest LNG importer, or Europe.

“Iran, within five years, will likely have 24.6 billion cubic metres of natural gas available for annual piped gas exports beyond its current supply commitments. Not enough to supply all major markets, Tehran will face a crucial geopolitical choice for the destination of its piped exports. Iran will be able to export piped gas to two of the following three markets: European Union (EU)/ Turkey via the Southern Gas Corridor centring on the Trans-Anatolian Natural Gas Pipeline (TANAP), India via an Iran-Oman-India pipeline, or China via either Turkmenistan or Pakistan. The degree to which the system of energy relationships in Eurasia will be more oriented toward the European Union or China will depend on the extent to which each secures Caspian piped gas exports through pipeline infrastructure directed to its respective markets,” Tanchum argued.

The lifting of international sanctions in 2015 as part of an agreement on restrictions on Iran’s nuclear program significantly enhanced the Islamic republic’s ability to Eurasia’s energy architecture. Iran boasts the world’s second largest natural gas reserves and its fourth largest oil reserves.57

Tancuhum’s analysis means that China would have to ensure that it is Iran and Turkmenistan’s main gas importer. That would position One Way, One Belt as Eurasia’s key energy infrastructure and solidify Chinese influence in Central Asia. China already dominates Turkmen gas sales

The one option Tanchum appeared not to consider was Iran choosing Europe and China as its main export markets despite Turkey’s proximity, cultural affinity, and already existing arrangements for the import of Iranian gas. Europe and China have already begun to put the blocks in place for a shared role in Eurasia. Tens of rail links traverse the Eurasian landmass from China to the Atlantic.

Both China and Europe are developing new cities and trade hubs in remote locations that often were nodes on the ancient Silk road. These include Lanzhou in western China, Horgos/ Khorgos in the Saryesik-Atyrau desert on the Chinese-Kazakh border, and Terespol on the Polish-Belarus frontier.

The frenzy is attracting not only Chinese, Russian and European but also Japanese and Indian investment in the knowledge that emerging hubs and networks will be available to all. The open question is whether any one power will dominate them and, if so, who.

China has already many of the building blocks needed to turn its ambitions into reality: close and long-standing relations with Iran, significant investment in Turkmen gas production and pipeline infrastructure, and the construction of Pakistan’s section of the Iran-Pakistan pipeline. Hooking the pipeline to One Belt, One Road would allow China to receive Iranian gas not only by sea on its eastern seaboard but also in its land-locked, troubled north-western province Xinjiang.

Compensating for handicaps

Iran in positioning itself as a key link in China’s trans-continental One Belt, One Road initiative. Iran constitutes both a key land and maritime node. Saudi Arabia’s importance beyond energy supplies is at best maritime. The Maldives, a strategically located 820km-long chain of Indian Ocean atolls, has emerged as a significant player in Saudi Arabia’s effort to compensate for its handicap and ensure the secure export of its oil, gas and other goods to China.

Saudi interest coincides with increased Chinese investment in the Maldives, a collection of 1,200 coral islands, that opposition politicians believe could eventually host China’s next military base as well as Saudi military outpost. China and Saudi Arabia are independently constructing their first foreign military bases in Djibouti. They “want to have a base in the Maldives that would safeguard the trade routes, their oil routes, to their new markets. To have strategic installations, infrastructure,” said ousted former Maldives President Mohamed Nasheed.58

Saudi Arabia was negotiating a $10 billion development, if not the wholesale acquisition of Faafu, a collection of 19 low-lying islands 120 kilometres south of the Maldives capital of Male. The project would involve construction of seaports airports, high-end housing, and resorts and the creation of special economic zones policy. Saudi Arabia could be granted a freehold provided that 70 percent of the project is executed on reclaimed land.59 The investment would be three times the GDP of the Maldives, a nation of 400,000, including 100,000 foreign workers, that spans 1,000 kilometres across the Indian Ocean and some of the world’s key shipping routes.

Saudi interest in Faafu with a 2014 visit by then crown prince Salman and his son Mohammed, now deputy crown prince. Mohammed returned a year later to host a week of parties. He and his entourage took over two resorts. Guests flew in night after night on private jets to attend the parties, which featured famous entertainers including the rapper Pitbull and the South Korean singer Psy. The Saudis signed at about that time a memorandum of understanding that involved the sale of Faafu to the kingdom.60

Saudi Arabia and China moreover shouldered complimentary projects in the Maldives. Chinese premier Xi Jinping in 2014 construction of a $210 million Friendship Bridge that would connect Male to the Maldives airport.61 The troubled Saudi Bin Laden Group won a contract to build a new terminal for the Ibrahim Nasir International Airport after having first awarded the project to an Indian company.62 Saudi Arabia has also pledged tens of millions of dollars in loans and grants for infrastructure and housing on an artificial island near Male.

China also agreed to build a new airport runway as well as a port in Laamu, an atoll south of Faafu. The port would be one more stone in China’s string of pearls. The Maldives, moreover, in 2016 leased Feydhoo Finolhu, an uninhabited island close to Mahe previously used by the government for school trips and youth activities, to a Chinese company for 50 years at a cost of $4 million.63

Saudi and Chinese interest in the Maldives comes as the two countries upgrade military cooperation.

“China is willing to push military relations with Saudi Arabia to a new level,” Chinese Defense Minister Chang Wanquan told his visiting Saudi counterpart, Deputy Crown Prince Mohammed bin Salman in August 2016.64 Special counter-terrorism forces from the two countries held the first ever joint exercise between the Chinese military and an Arab armed force two months later. With the United States refusing to share its drone technology, China and Saudi Arabia agreed that China would open its first overseas defense production facility in the kingdom. State-owned China Aerospace Science and Technology Corporation (CASC) will manufacture its CH-4 Caihong, or Rainbow drone as well as associated equipment in Saudi Arabia.65

To lay the ground for Saudi investment in the Maldives, Saudi Arabia provided the island republic in 2013 $300 million on soft terms and has massively funded religious institutions and education. The kingdom offers scholarships for Maldives students to pursue religious studies at the kingdom’s ultra- conservative universities in the holy cities of Mecca and Medina and has donated $100,000 to the Islamic University of the Maldives.

During a visit in 2015, Saudi Islamic Affairs Minister Saleh bin Abdulaziz promised to help the Maldives improve the collection of zakat, alms for the poor that constitute one of Islam’s five pillars, publish Islamic texts in English, speed up mosque construction, and train imams.66 The kingdom has also funded the construction of the six-storey, multi-facility King Salman mosque, the island republic’s largest.67

The kingdom has also not shied away from influencing public opinion by bribing journalists. In one incident, journalists were handed cash-filled envelopes during an event at the Saudi embassy in Mahe.68 Other journalists report that they are harassed when reporting critically on Saudi interests in the Maldives or on the rise of ultra-conservatism. Many journalists see the disappearance in 2014 of Ahmed Rilwan Abdulla, a prominent journalist, who wrote about secularism and ultra- conservatism, as warning.

Saudi Arabia’s investment paid off in early 2016 when the Maldives broke off diplomatic relations with Iran, charging that Iranian policy threatened security and stability in the Indian Ocean.69 It has also left its mark on society. Saudi-funded ultra-conservatism has contributed to the Maldives, a popular high end tourist destination that prided itself on adhering to a blend of Sufism and other religions. becoming increasingly less tolerant and less accepting of liberal lifestyles. Forms of entertainment like mixed dancing and western beach garb have become acceptable only within the walls of expensive resorts. Reflecting the shift towards ultra-conservatism, a court in 2015 for the first time sentenced a woman to death by stoning for having committed adultery.70 The Saudis “have had a good run of propagating their worldview to the people of the Maldives and they’ve done that for the last three decades. They’ve now, I think, come to view that they have enough sympathy for them to get a foothold,” Nasheed said.

Indian intelligence sources worry that the Maldives could become a base of a very different kind just off the sub-continental mainland71. They and independent analysts72 assert that hundreds of Maldivians have joined the ranks of IS in Syria – a significant number given the country’s tiny population.73 Some 200 people carrying Islamic State flags marched in 2014 through Mahe demanding implementation of Sharia law instead of democracy.74

Punctured by protest

Troubled Asian ports that China envisions as part of it’s string of pearls linking the Eurasian heartland to the Middle Kingdom shine a glaring spotlight on the pitfalls threatening Beijing’s ambitious One Belt, One Road initiative, and offer a window into the Great Game’s dynamics. The pitfalls are magnified by mounting criticism of terms imposed by China in agreements for the development of infrastructure and growing anti-Chinese resentment.

Resentment has translated into increased violence in Balochistan, the Pakistani province that is home to the warm water, deep sea port of Gwadar that lies at the heart of One Belt, One Road. The violence is also fuelled by Pakistan’s long-standing ties to militant groups that regularly rock the country with their attacks. And it feeds on continued warfare in Afghanistan. As a result, Gwadar has yet to emerge as a major trans-shipment hub in Chinese trade and energy supplies.75

Similarly, Chinese prospects for the development of Sri Lankan ports, including Hambantota, are clouded. Opposition that has spilled into the streets of the struggling port could dissuade Chinese investors from sinking billions of dollars into the flailing projects aimed at turning Hambantota into South Asia’s foremost port bolstered by an economic hub.76 Violence and protests have put the spotlight on terms that appear to define China’s win-win approach as China wins twice. China is not in the business of providing either non-military aid or budgetary support. Its loans provided by Chinese-backed development banks have turned out to be less soft that China would have people believe and produced debt traps for recipients.

Sri Lanka is struggling to escape the trap, cool-headed analysts fear Pakistan is heading towards one,77 and Tajikistan is struggling to cope with the burden of debt to China. Forced to do a land for debt swap to reduce its huge debt to China, Tajikistan ceded control of 1,100 square kilometres of mountainous farm land to the under the garb of settling a centuries-old border dispute. The land in one of the world’s most impoverish countries is being tilled by Chinese farmers to the chagrin of many Tajiks.78 The cancellation of a plan to expand the gas pipeline linking Turkmenistan to China is likely to exacerbate Turkmenistan’s economic crisis. Turkmenistan was counting on increased gas sales to help it turn the economy around. The expansion was cancelled because state-owned companies, China National Petroleum Corporation (CNPC) and Uzbekneftegaz, failed to agree on terms that would have ensured that Uzbekistan would benefit from the pipeline beyond simply being a transit country.79

The downside of perceived Chinese largesse has prompted Asian nations to play both ends against the middle. Sri Lanka, for example, initiated a partnership dialogue with the United States that led to military cooperation.80 A US naval vessel visited Sri Lanka weeks later followed subsequent visits81 as well as the US Pacific Command providing humanitarian and engineering assistance in the Tamil north of the county.82 Most symbolically, a US maritime patrol aircraft arrived at Hambantota’s Mattala Rajapaksa International Airport in December of that year.83

China’s efforts to balance its geopolitical ambitions with a need to address overcapacity as a result of a downturn in its economy dictates commercial terms of projects it backs creates opportunity for its rivals. China’s advantage is its ability and willingness to commit massive resources. Its Achilles Heel is the fact its initiatives are driven as much by domestic concerns as they are by geopolitical ambition. Chinese commercial terms are geared towards creating opportunity for China’s huge, state-owned infrastructure companies to stay afloat and maintain employment at a time that the government seeks to make consumption rather than production the main driver of the country’s economy. Chinese companies are aided in their endeavour by what Chinese chief executive officers call the

China Way or the pursuit of growth at all costs, including, if need be, slashing profits, marginalizing shareholder returns and taking costly risks.84

Western consultants estimate that China has allocated $100 billion a year to One Belt, One Road. Approximately half of that stimulates China’s domestic economy as expenditure on raw materials for overseas projects. It utilizes excess commodities such as steel and iron. Much of the remaining 50% is spent on construction, engineering, and high-tech equipment.85

China’s strategy may produce short-term economic relief but could prove long-term detrimental both economically and in terms of the country’s geopolitical ambitions. China brings as assets to the table funding, low-cost labour, and an ability to carry long-term losses. However, to make the strategy work, China needs to sub-contract Western engineering and construction companies with the local networks and track records their Chinese counterparts lack. Sub-contracting adds to the debt burden of Chinese state-owned enterprises and with returns on investment years, if not decades, away could come to haunt Chinas economy.

China’s commercial terms, moreover, fuel mounting anti-Chinese sentiment that threatens China’s geopolitical ambitions. The consequence is that protests puncture China’s string of pearls, a phrase coined by defence consultancy Booz Allen Hamilton in 2004 in a report to US secretary of defense Donald H. Rumsfeld.86 The pearls include beyond the Caucasus, Gwadar and Hambantota, the $10.7 billion development of an industrial city next to the Omani port of Duqm;87 a $500 million container terminal in the Sri Lankan capital of Colombo; Kyaukpyu in Myanmar; a naval facility in Djibouti, China’s first foreign military base; and a likely port in the Maldives. Separately ten Chinese ports have formed an alliance with six Malaysian harbours.88 The string of pearls constitutes the maritime

leg of what China inexplicably has identified as the Road leg of One Belt, One Road. The Belt refers to the land-based network of roads, railways and pipelines. The protests and violence in countries like Pakistan, Afghanistan and Sri Lanka have forced China to provide military assistance, dispatch security forces, and contract private security companies to protect its investments and personnel, adding significantly to the cost of One belt, One Road projects.

Still up for grabs, ports in Bangladesh have emerged as a focal point in the Great Game. Wooed by China, Japan and India and pressured by the United States, Bangladesh, a country strategically tucked into India’s armpit, has blown hot and cold on offers to develop the country’s first deep sea port. Agreements and understandings have been signed only to be cancelled. China has offered to sink $9 billion into Chittagong Port and position it as Gwadar East. As tempting as the offer was, Bangladesh backed away. Instead, to pacify critics, it granted access to Indian cargo vessels.89

In the latest twist in the port saga, Bangladesh signed in December 2016 two memoranda of understanding with China Harbour Engineering Company Limited (CHEC) and China State Construction Engineering Corporation (CSCEC) for the $600 million development of its third most important port in Patuakhali.90

Bangladesh may also be wary of experiencing the volatility that Chinese-backed ports else where are witnessing. Caucasian ports are no less troubled than those in Pakistan and Sri Lanka. Riots in March 2017 in the Georgian pot town of Batumi were sparked by an incident unrelated to Eurasian power plays but were indicative of a degree of volatility that could affect the designs of regional powers. “The socio-political situation is so tense in at least parts of the country that it, in fact, resembles a powder keg ready to explode… It is highly unlikely that the Batumi protests will be the last of their kind,” warned Vasili Rukhadze, an academic and former head of the Georgian Truth Commission.91

A decade of setbacks

Almost a decade of Chinese efforts to get the Pakistani port of Gwadar up and running have been stymied by jihadists and Baloch nationalists. Baluch insurgents have in recent years repeatedly targeted gas pipelines, fuel tankers, trains and Chinese personnel.92 Investors and Chinese officials travel in Balochistan accompanied by Pakistani military vehicles on roads that are picketed by policemen at 50-metre intervals and cleared of all traffic.

An estimated 46 workers building a road between Gwadar and the Baloch capital of Quetta have been killed in recent years.93 Chinese hopes suffered a further setback with the expansion of the Islamic State’s (IS) theatre of operations into Pakistan and Afghanistan. The Baloch capital of Quetta was twice rocked in 2017 by bombings that killed scores of police cadets and judicial personnel. 94 All in all, Balochistan government officials said the number of attacks on security forces in the region rose dramatically in 2016, 48 compared to approximately 20 in 2015.95

Adding to the volatility is Balochistan’s potential to become a launching pad for stepped up US pressure on Iran and a possible return to a policy of regime change. Speaking to the US Senate Armed Services Committee, General Joseph L. Voltel, head of US Central Command, advised that “in order to contain Iranian expansion, roll back its malign influence, and blunt its asymmetric advantages, we must engage them more effectively in the ‘gray zone’ through means that include a strong deterrence posture, targeted counter-messaging activities, and by building partner nations’ capacity. Through both messaging and actions, we must also be clear in our communications and ensure the credibility of U.S. intentions. Iran must believe there will be prohibitive consequences if it chooses to continue its malign activities designed to foment instability in the region… (We) believe that by taking proactive measures and reinforcing our resolve we can lessen Iran’s ability to negatively influence outcomes in the future.,” Voltel said.96

Mega projects in Balochistan, one of Pakistan’s least developed and most troubled regions, have a history of provoking local resistance. The region has witnessed five rebellions in the last 70 years all fuelled by Baloch claims that the federal government in Islamabad had exploited the province’s extensive gas and mineral riches for the benefit of the country’s ruling establishment in Punjab. picketed by policemen at 50-metre intervals and cleared of all traffic.

China is investing $51 billion in Pakistan infrastructure and energy,97 including Gwadar port that has been struggling to attract business nine years after it was initially inaugurated. The Pakistan government has deployed 15,000 troops to protect China’s investment, a massive project dubbed the China-Pakistan Economic Corridor (CPEC), the flagship of China’s Eurasian One Belt, One Road initiative. The unit created especially to secure CPEC projects is made up of nine army battalions and six civil armed forces wings.98

Locals in Gwadar dismiss Chinese assertions that the town’s will replicate the success of the Chinese port of Shenzhen. Shenzhen transitioned in a matter of decades from a fishing village into an industrial urban centre. Shenzhen, unlike Gwadar which is 650 kilometres from Karachi, the nearest city, was able to piggyback on Hong Kong, located just next door, with a GDP multiple times larger than that of all of Pakistan. “The local population have been made prisoners in their own town,” said a frequent traveller to Gwadar.99 Hostility has been reinforced by hard-handed military tactics to squash the insurgency.

Intimidation of the local population by the insurgents aggravates the situation. Only four percent of eligible voters in Balochistan turned out for a by-election in December 2015 after rebels threatened violence and attacked candidates.100 The sense of incarceration and alienation is likely to increase with the building of a security fence around the town and entry points that will grant access only to those in possession of a residency pass.101

Chinese, Pakistani and Russian officials warned in December 2016 that militant groups in Afghanistan, including the Islamic State (IS) were expanding their operations. IS in cooperation with the Pakistani Taliban launched two months later a wave of attacks that has targeted government, law enforcement, the military and minorities and killed hundreds.102

Indian Prime Minister Mahindra Modi added to the tension by charging in an Independence Day speech that Pakistan would “have to answer to the world for the atrocities committed by it against people in Baluchistan.”103 Modi’s remarks broke with India’s long-standing avoidance of public association with Balochistan’s troubles, prompting fears in China that its problems in Pakistan were about to multiply. Statements by Pakistani intelligence in the military said several months later that surrendering Baloch insurgents had asserted that they were funded by Indian intelligence.104

The “policy of indifference towards Pakistan’s war crimes in occupied Balochistan that include both ethnic cleansing and genocide, adapted by the international community is worrying. The Indian Prime Minister’s statement on Balochistan is a positive development. (The) Baloch nation hopes that the United States and Europe will join Prime Minister Modi and hold Pakistan accountable for the crimes against humanity and the war crimes it has committed against the Baloch nation in 68 years of its occupation of Balochistan and during the five wars that the Baloch nation has fought with Pakistan to win its national freedom,” said Khalil Baloch, chairman of the Baloch National Movement.105

Modi’s remarks were all the more significant given Gwadar’s strategic importance to Chinese energy security. Once fully operational Gwadar would be the key node in a land-see energy supply line from the Gulf to China that would circumvent India as well as the South China Sea. Gwadar is a mere 380 kilometres from the Strait of Hormuz at the southern tip of the Gulf and Oman, which governed the port until 1958. Gwadar would shorten the roughly 12,000-kilometre sea route from the Gulf to China’s eastern seaboard to a mere 2,395 kilometres with a pipeline ending in Xinjiang’s Kashgar, one of the busiest bazaars on the ancient Silk Road. Literally translated as New Frontier, Xinjiang is a resource-rich, militarily crucial but troubled province in northwest China that is home to the Uyghurs, a restive Turkic Muslims.106 China sees economic development as the key to squashing the Uyghur’s nationalist aspirations.

As China moved to gradually expand the scope of its military and private security operations in Central and South Asia, IS followed up its wave of attacks in Balochistan with a 30-minute video that denounced “evil Chinese communist infidel lackeys” and promised to “shed blood like rivers” in attacks on Chinese ones. Filmed in Iraq by IS’s Al-Furat Province, the video featured Uyghur fighters and their heavily armed children who appeared to hail from Xinjiang. Offering a stylized view of Uighur life in the caliphate, the video showed scenes of their battles and prayers as well as the execution of alleged informants. The group’s threat against China was issued by a fighter as he prepared to put to death a suspected informant.107

Overlooked by most analysts, Australian scholar Michael Clarke pointed out that the video also suggested that IS at a time that it was on the defensive in Syria and Iraq was seeking to become the dominant jihadist player in Xinjiang and among Uyghurs. A militant in the video denounced the Al Qaeda-affiliated Turkistan Islamic Party (TIP), the hitherto foremost Uyghur group, as apostates and called on its members to defect to IS. TIP has roots in Afghanistan and has had a presence in Syria since 2012.108

Release of the video coincided with a rally in Xinjiang of thousands of armed riot police backed by armoured vehicles and helicopters intended to demonstrate their resolve to crush nationalist and Islamist militants.109 China has cracked down on religious practice in the region as part of its campaign against the militants.110 The video featured images of Chinese riot police guarding mosques, patrolling Uygur markets, and making arrests. It showed the Chinese flag engulfed in flames. Chinese authorities have offered rewards of up to 100 million yuan ($14.5 million) for tips of militant Uyghur activity.111

China concerns were already bolstered when IS identified East Turkistan as one of its target areas. The group’s caliph, Abu Bakr Al Baghdadi, listed the People’s Republic at the top of his list of countries like the United States and Israel that violate Muslim rights in his 2014 declaration of the caliphate.112 Maps circulating at the time on Twitter purporting to highlight IS’s expansion plans included substantial parts of Xinjiang.

IS’s pivot eastward threatened not only Chinese policies in Xinjiang but also the land pillar of China’s proposed Silk Road in Central Asia and the Middle East. It put Chinese operations in Afghanistan and Pakistan in the bull’s eye. Uyghurs were among the militants who attacked the Chinese embassy in Bishkek, the capital of Kyrgyzstan in August 2016, and several months later on New Year’s Eve a nightclub in Istanbul.113

A survey of Uyghur IS fighters has suggested that lack of opportunity in Xinjiang was a key driver of militancy. Of 114 fighters surveyed by New America, a Washington-based think tank, none had enjoyed a university education, only two had been professional employed, and a majority had not travelled abroad before joining IS. The survey suggested that the fighters were primarily unskilled workers from rural areas of Xinjiang and that they had not been associated with militant or jihadist Uyghur groups prior to joining IS.114

Translating ambition into reality

IS’s targeting of China called into question the strategy underlying CIPEC. In a sense, it puts China’s cart before the horse. A successful IS campaign would dash Chinese hopes that economic development in Pakistan would spur a similar development in Xinjiang. Pakistan and China’s failure so far to turn Gwadar into a thriving port and trading hub constitutes in part a militant success.

Complicating efforts to make Gwadar viable is the fact that Pakistan will have to not only address Baluch grievances, but also ensure that Baluchistan does not become a playground in the bitter struggle for regional hegemony between Saudi Arabia and Iran or potential US efforts to engineer regime change in the Islamic republic. Separatist claims in the region are rooted in a broken British colonial promise of independence. To counter Baloch aspirations and dial back violence, Pakistan will also have to revisit its long-standing policy of distinguishing between jihadist groups with global ambitions and its proxies that target India and Kashmir.

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