China’s Master Plan to Thwart American Dominance in Asia [Part 2]

By  | The National Interest | Original Source

PM_and_Chinese_President_Xi_Jinping_witness_signing_of_3_MoUs_in_Ahmedabad_(15275647382)And it’s using India and Russia to its advantage.

Yet China did not let the rhetoric in Ufa get out of hand. Beijing has carefully noted the extent to which Germany has become the donor nation to sustain the European Union, and is leery of assuming a Berlin-style role as the source of handouts and bailouts for the other BRICS and SCO members coming to Beijing with their hands out. The Ufa meetings did not settle some of the outstanding matters in the Russia-China economic relationship, including the final price for natural gas and the financing of some of the major infrastructure projects that were signed this past year. Moscow received no blank check from Beijing. The “New Development Bank” (NDB) and the currency pool, both critical items that Russia, cut off from Western financing, sees as crucial for its future development plans, were finally brought into existence—but China is likely to be very cautious in using these funds recklessly to prop up the Russian economy. China is also not particularly interested in turning the AIIB into a Chinese-funded piggy-bank for other nations’ pet projects. No major new infrastructure projects to be funded either by the NDB or the AIIB were announced at Ufa, even though the Indians brought some concrete proposals to the table about expanding the north-south corridor that links South Asia via Iran and Azerbaijan to Russia and Kazakhstan and thus to Europe.

Ufa did provide an opportunity for a face-to-face meeting between Modi and Pakistani prime minister Nawaz Sharif, which led to a joint communique on fighting terrorism and seeking resolution of some of the irritants in the bilateral relationship that could serve as the basis for a limited rapprochement. Shared membership in the SCO might also provide an institutional firewall to help contain ongoing Indo-Pakistan tension. Moreover, Modi, in his fifth bilateral meeting with Xi, raised a set of contentious issues. On the one hand, no breakthroughs were achieved in Ufa, but Modi and Xi agreed to keep talking, and to accelerate work on the commission charged with settling the boundary issues. As much as Washington likes to trumpet its good relationship with India, the reality is that Xi has made cultivation of India much more of a priority than Washington has. India and Pakistan are also now set to become full members of the Shanghai Cooperation Organization—which means that New Delhi has yet another institutional framework for conducting its relations with Russia and China in a forum that excludes the United States.

Nothing definitive was settled at Ufa—but the foundations are being laid for a fundamental shift in the balance of power in Asia. Washington can always hope that a massive slowdown in China’s economic growth, coupled with increased distress in the Russian economy, could bring many of these plans to naught. Beijing may also balk at paying the price for becoming the main purveyor of regional public goods. But Xi and Putin leave Ufa with positive momentum and a growing confidence that the correlation of forces in the global arena might be showing signs of breaking their way.

Nikolas Gvosdev, a professor of national security studies and a contributing editor at The National Interest, is co-author of Russian Foreign Policy: Vectors, Sectors and Interests (CQ Press, 2013). The views expressed here are his own.

Image: Wikimedia Commons/Narendra Modi