China’s Civil-Military Forays In India’s Neighborhood – Analysis


By N. Sathiya Moorthy*

There are hints that Beijing is shedding its COVID restrictions and is making fresh forays in the nation’s neighbourhood as can be seen by the fresh round of border talks between Bhutan and China. The reported construction of a military facility on Coco Islands in Myanmar and a proposed remote satellite receiving ground station in Sri Lanka are new bugs in India’s bonnet. The reasons are not far to seek. If true, such moves could facilitate possible surveillance across the region.

Confusion over bilateral border talks at Kunming, China, surfaced in India followingthe Bhutanese Prime Minister Lotay Tshering’s interview to a Belgian newspaper in February. At the Kunming talks in January, experts from the two countries agreed to ‘push forward’ their boundary talks and to reach agreements. In his interview a month later, PM Tshering was seen downplaying the differences, and saying that ‘some territories (alone?) have not yet been demarcated’.

Apart from conventional concerns involving China, in this specific case, India was keen on the Bhutanese position over the Doklam tri-junction. As may be recalled, there was a military stand-off between India and China after the Thimpu sought New Delhi’s assistance when China reportedly tried intruding into Bhutanese territory in 2017. However, Indian concerns were said to have been addressed during Bhutanese King Jigme Khesar Namgyel’s New Delhi visit in the first week of April, when he met with Prime Minister Narendra Modi and other top government leaders.

Non-interference clause

In this overall background, an American think-tank, interpreting a recent satellite picture, has indicated the possibility of Chinese installations on Myanmar’s Coco Islands, not far from India’s Andaman and Nicobar islands. The report also suggested that similar installations have been proposed for China-controlled Hambantotaterritory in Sri Lanka.

The analytical report claimed that the Coco Island installations, including an accommodation block, could be used to spy on the region as a whole. India, in particular, should be concerned, both for itself and its smaller neighbours, irrespective of the Chinese motives and consequent actions.

In particular, the report referred to last year’s controversial berthing of Chinese spy ship Yuan Wang-5 at Hambantota, which raised temperatures in New Delhi and also many Western capitals. It added that the ground stations could perform what all the ship was meant to do, and vice versa. The American analysis also referred to a past agreement between China and Argentina, indicating that the local authorities cannot question or interfere with Chinese activities from their new installations. It is not clear if any such clause was included in the Hambantota debt-to-equity deed, while leasing out Sri Lanka’s territory to China for 99 years.

Sri Lankan denial

Sri Lankan Foreign Minister Ali Sabry has since denied the think-tank report, saying no (Chinese) request was made for setting up a radar-base or any such installations. Thus, no clearance was given. Does it imply that China may not have to obtain Sri Lankan government’s approval for whatever it does on Hambantota property, if a saving clause of the Argentina kind was already there in the lease deed?

Be it as it may, the recent China visit of a 15-member delegation representing the ruling coalition in Sri Lanka has raised concerns, both inside the country and outside. The team comprises five representatives of President Ranil Wickremesinghe’s United National Party (UNP), which otherwise has only a lone member in the 225-seat Parliament.

Ten members of the team belong to the Sri Lanka PodujanaPeramuna (SLPP), the party founded by the Rajapaksas, whose participation in the government and parliamentary support alone is sustaining the Wickremesinghe presidency. The list includes a kin of the Rajapaksas. Independent of this visit, discredited former President Gotabaya Rajapaksa possibly became the first Sri Lankan leader to visit China, post-COVID, in February this year.

Petroleum pact

Independent of these developments, a Sri Lankan Tamil language newspaper from Jaffna reported that the Chinese Global Television had undertaken a 10-day satellite-based test transmission that covered the island-nation’s north-eastern region, closer to the Indian coast. The TV already has a terrestrial transmission in some parts of the country for years now.

In another development that may be of greater concern to New Delhi the China Petroleum & Chemical Corporation, or Sinopec, and Sri Lanka are to finalise an agreement for import and retail sale of petroleum products in the country. The agreements, according to reports, will be signed in May, and individual companies will start operations 45 days thereof.

As a policy after last year’s fuel crisis caused by dollar-shortage last year, the government has cleared similar proposal also from Untied Petroleum Company of Australia and M Parks Company of the US, from among the 26 proposals that were received in an open tender process.  That the fuel crisis occurred when public sector Ceylon Petroleum Corporation  (CPC) and Indian Oil Corporation have a live joint venture in the Lanka IOC (LIOC) that has also been marketing petroleum products across the country has not gone unnoticed.

India also signed an agreement early last year (ahead of the economic crisis and the consequent Aragalaya mass protests) to refurbish a substantial number of vintage oil tanks in the two ‘tank farms’ in eastern Trincomallee, for shared storage and use. While the two sides will jointly refurbish 61 of the 99 tanks in the farms, 24 will be developed by CPC and 14 by LIOC. This arrangement will hold for 50 years. The investments are considered huge and the works, when taken up, will take considerable time.

Chinese projects in Maldives

In neighbouring Maldives, China has made a fresh entry through four MoUs / Letters of Exchange during the recent visit of Deng Boquin, Vice-Chairman of the Chinese International Development Cooperation Agency (CIDCA). Maldivian Foreign Minister Abdulla Shahid and the Chinese Ambassador Wang Lixin were present on this occasion.

The key agreements provide for the bilateral Development Cooperation Plan for 2023-25, renovation of Maldives National Museum, maintenance of China-funded Sinamale sea-bridge linking capital Malé and airport island of Hulhumale, and feasibility study on building four island hospitals. The visitor also made a courtesy call to Vice-President Faisal Naseem, who remarked that China ‘contributed immensely to the socio-economic development’ of Maldives.

In a separate but related development, the Maldives Fund Management Corporation (MFMC) has awarded the China-funded US$ 145-m Hankede tourism development project in southern Addu City to the China National Electrical Engineering Company (CNEEC). While ruling MDP’s Addu Mayor Ali Nizzar readily welcomed work-allotment, which has been delayed for long, local media reports, however, claimed that the Chinese company has been ‘sanctioned’ by the World Bank for wrongdoings in Zambia. The Opposition PPM-PNC-controlled Malé Municipal Council has also awarded US$ 90 million for renovation works of a main road, Boduthkurufaanu Magu, in Maléto China’s Hunan Construction Engineering Corporation, after the Male-Hulhumale road, re-laid in 2018, developed cracks at 32 points. The work needs to be completed in 30 days, according to the contract stipulation.

With tourism, the nation’s economic mainstay, picking up rapidly in the past months post-COVID, the Chinese envoy has said that more Chinese tourists would be visiting Maldives in the coming months, starting with the five-day May Day holiday. At present, Russia tops the list of foreign tourists toMaldives, despite the Ukraine War, pushing the Indian neighbour to the second place.

With COVID lockdown in the two countries, namely, Sri Lanka and Maldives, way behind now, India’s Afcons has commenced work on the prestigious, India-funded, $ 500-m Thilamale sea-bridge. The bridge, when completed, will linkMalé with two commercial port and industrial islands, apart from helping to decongest the capital, which is one of the most crowded capitals in the world.

The government of President Ibrahim Solih has clarified that though the Indian-based construction firm has changed hands in recent times and that the Maldivian authorities were not taken into confidence, there would be no let up in the work on this and other projects awarded to them. That would be saying a lot in context.

However, it remains to be seen how the China deal and retail fuel sale in particular progresses from here – whether it is to support Sri Lanka with petroleum supplies, or to compete with India in that sector. That will be saying a lot, for starters.

*About the author: N. Sathiya Moorthy is a policy analyst and commentator, based in Chennai.

Source: This article was published by Observer Research Foundation

Observer Research Foundation

ORF was established on 5 September 1990 as a private, not for profit, ’think tank’ to influence public policy formulation. The Foundation brought together, for the first time, leading Indian economists and policymakers to present An Agenda for Economic Reforms in India. The idea was to help develop a consensus in favour of economic reforms.

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