West Asia remains among one of the most strategically crucial regions for India- one that is critical to India’s oil supplies and also trading routes given the many chokepoints in the region. For years, New Delhi followed a hands-off approach in West Asia as the US went ahead with a strong hand in the region.
But now things might be changing- Washington is becoming increasingly disillusioned of the burdens that come along with maintaining hegemony in West Asia, which is riddled with conflicts.
As the US starts to pull back, Beijing has been filling the voids being created by Washington’s drawdown. And this is where India might have to reconsider its policy of watching over from the ringside, because with China establishing its hegemony in the region New Delhi has a lot to worry about.
The United States has its own reasons for distancing itself from the Gulf and having lost far too many lives in the West Asia, the Trump administration doesn’t want to involve itself further. Moreover, the US has gained energy independence, and the main reason why the country invested itself in the Gulf no longer exists.
Compare this with China, which is the second-largest consumer of oil in the world next only to the United States. But unlike other giants- the United States or even Russia, China imports most of its oil. Almost half of all the oil consumed in the Asian giant comes from West Asia, which is why the Dragon is yearning to fill spaces being created by the American pullback in West Asia.
And to be certain, it is happening already as China keeps stepping up its investments in the Gulf region despite scaling down its investments elsewhere due to a slowdown in the Chinese economy. And how? Beijing is trying to build economic interdependence as a part of its ambitions to gain greater influence in the region.
The Dragon has started investing more in the region than the United States itself. Beijing has ensured that the focus of the Gulf-China trade goes beyond hydrocarbons into other sectors such as industry, finance, transport, communications, and other technology.
Beijing has thus offered West Asia what it wants. The Gulf States have realised the perils of a single-sector economy especially in the times of the Coronavirus Pandemic when oil prices slumped like never before. By investing in technology and infrastructure, China is giving them the option of diversifying.
Take Saudi Arabia for instance- the US and Saudi Arabia continue to share strong ties. But as the United States became energy independent, there was a clear strain and while Saudi Arabia’s price competition was meant to hurt Moscow, it ended up causing a sharp drop in WTI Oil prices too hampering American interests.
The US recently took away its anti-missile system that guarded Saudi oil facilities, a move that might be punitive for Saudi Arabia, and which also carries a message- the US has lost interests and stakes in the region so Riyadh must fend for itself. Saudi Arabia has learnt how dependence on the oil sector can take the shape of a disaster when other countries become independent.
What India must understand is that with the United States ceding more and more space, China’s involvement in the region will keep growing. Russia is no longer a power that can occupy the space that the United States is leaving, and therefore China gets to up the ante.
This can put India in a strategic abyss, as New Delhi imports 84 per cent of its oil needs and two-thirds of this import demand is fulfilled from the Middle East. India has strong ties with the Gulf region built on the bedrock of our oil import needs, but the implications of Indo-Gulf ties go beyond oil import itself.
A geopolitical situation is developing in the Gulf and it is centered around the crucial economic chokepoints in the region- the Strait of Hormuz, Bab-el Mandeb, and the Suez Canal.
China is trying to build its presence across all these chokepoints, which handle considerable oil traffic apart from forming vital links in the trade routes through this region. If China manages to occupy the space being left behind by the United States, it can easily threaten India’s interests in the region by blocking the chokepoints which will hinder oil supplies and imperil trade routes.
China has a military base in Djibouti and hold on Pakistan’s Gwadar Port, which helps it in building presence around the Strait of Hormuz- the busiest sea oil route in the world. More importantly, China is the biggest importer of Iranian oil as it did not stop purchasing oil from a sanctions-hit Iran, unlike India.
Tehran controls the Strait of Hormuz and while India is developing the Chahbahar port, there is no reason why China would not want to use its special reasons with Tehran to India’s detriment.
This chokepoint forms a vital link between the Mediterranean and Asia, and cargo ships between Asia and Europe have to pass from here if they navigate the Suez Canal. Also, vessels carrying oil from West Asia to North America or Europe have to pass from here.
India is also planning to develop the strategically located Duqm port in Oman that will give the country access to Central Asia and Europe but China is throwing billions of dollars in Duqm so that it can bypass the Strait of Hormuz.
In fact, China is gaining another chokepoint- the Suez Canal by investing heavily in its project to develop the Suez Canal Corridor. The Suez Canal handles significant oil traffic from West Asia to Europe, and for India it means a shorter distance to the European markets. By replacing the US in this part of the world, China can jeopardise all of India’s trade routes.
India will have to offer something lucrative to these countries so that they do not fall prey to Chinese influence. At the end of the day, Gulf countries will side with that Asian giant which offers them more diversification opportunities.
Beyond the trade routes and oil supplies, India must maintain strong ties with the Gulf region keeping its security interests in mind. At least diplomatically, the Arab world doesn’t support Islamist terrorism and has also supported India’s position in Kashmir.
This could change upside down when China starts dictating terms in the region. Also, the Gulf figures prominently in India because of its prolific markets which India doesn’t want to lose. As the Arab world becomes China’s happy hunting ground, it is time New Delhi recalibrated its position in the region.