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Mainstream, VOL LVII No 46 New Delhi November 2, 2019

Great Game In Central Asia: China Emerging as a Dominant Player

Tuesday 5 November 2019

by R.G. Gidadhubli

Central Asia—comprising of five Central Asian States (CAS), Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan—has experienced the great game being played by major powers from time to time during the last couple of centuries. An effort has been made here to examine issues and contentions and how the great game is being played at present in Central Asia by Russia, the USA and China.

Russia 

Central Asia is the southern underbelly of Russia, which has sustained close political and economic relations with all five countries even after the Soviet breakup. Moscow enjoyed total control and power over the CAS for 70 odd years during the Soviet era. But having got independence, not to be over-dependent on Russia, the CAS, in their own national interest, have been making efforts to establish economic and political ties with major powers in the world.

To retain and sustain economic relations, Russia does offer job opportunities to thousands of skilled workers from the CAS and has been a major trading partner of all the CAS even as the quantum of trade turnover has declined. It needs to be mentioned that Russia’s economic decline and sanctions by the West during the last few years since the Crimean crisis have adversely impacted Russia’s role in the CAS. However, efforts have been made by Russian President Vladimir Putin who is keen to enhance ties with the CAS. For instance, on September 20, 2019 both the Russian President and Kyrgyz President Sooronbai Jeenbekov discussed bilateral ties and regional integration in the post-Soviet era near the Russian city of Orenburg. They were observing military manoeuvres in the Donguz military test field near the Russian-Kazakh border with the participation of military units from China, India, Kazakhstan, Kyrgyzstan, Pakistan, Russia, Tajikistan, and Uzbekistan.

Russia seems satisfied with Turkmen President Berdymukhammedov and his govern-ment. Hence Russia’s energy giant Gazprom renewed a contract to buy gas from Turkmenis-tan after canceling its previous contract unilaterally at the start of 2016. Both Russia and Turkmenistan are energy rich and hence Gazprom does not need Turkmen gas but will purchase some 5.5 billion cubic meters (bcm) of gas annually under a New Deal signed at the end of June 2019 at a very low price—no more than $110 per 1000 cubic metres—and export to the West.

Hence in some respects Russia is a waning power in Central Asia even as Russia’s political ties with the CAS are close and consistent.

United States of America

The USA has keen interest in strengthening political and economic ties with the Central Asian States (CAS). On September 22, 2019 the US Secretary of State, Mike Pompeo, held a meeting in New York with the Foreign Ministers of all five CAS on the sidelines of the annual UN General Assembly. He conveyed perspectives of the USA concerning political issues and promoting ties with the CAS.

Firstly, prior to the visit of Pompeo, on August 20-23, 2019 US Undersecretary of State for Political Affairs David Hale went to Central Asia on a four-day official visit to enhance US-CAS ties. In fact this was part of the C5+1— (CAS+ USA) meeting established in November 2015 “to address common security and environmental challenges, improve regional trade flows and enhance prospects for US trade and investment with the region”. The objective was to discuss joint efforts toward a better-connected, more prosperous and more secure Central Asia.

 Secondly, on issues concerning the economic development of Central Asia, US officials and analysts are critical of China for encouraging the CAS to take on debt loads they cannot afford to pay back, potentially giving Beijing greater control over their internal affairs as also natural resources. Hence Pompeo told his CAS counter-parts to consider US companies when carrying out such projects and that the United States is ready to help them analyse foreign investment deals.

He was candid in stating that the USA respects the rights of the CAS to do business with whomsoever they wish. But they should consider how America does business—openly and fairly and on mutually beneficial terms. He assured that the USA too, can offer independent experts to review and assess foreign infra-structure investments in CAS countries if they are interested in that assistance as well. The US policy-makers intend to counter emerging superpower China which has geostrategic and geo-economic interests in Central Asia.

Thirdly, Pompeo also discussed greater cooperation on terrorism and drug trafficking with the Central Asian officials which are major problems facing the CAS. Uzbekistan, Turkmenistan and Tajikistan border Afghanistan, where the United States has been waging a war against militants for 20 years. He assured them: “The Trump Administration also takes your border security concerns very seriously. We don’t want terrorists or drug traffickers to be able to cross your borders with impunity.”

Fourthly, the Uygur issue has assumed signifi-cance. Hence Pompeo informed the CAS leaders to reject Beijing’s demands to repatriate ethnic Uyghurs to China, where they face repression. He was not only urging the CAS to resist China’s demands to repatriate Uighurs but also warning Beijing’s detention of about one million Uyghur Muslims in the western Chinese region of Xinjiang as an attempt “to erase” minority cultures and religions.

It is important to note that Xinjiang borders Kyrgyzstan, Kazakhstan and Tajikistan where many ethnic Uyghurs live in Central Asia. Pompeo’s argument is in sharp contrast to Beijing’s contention that the detention sites in Xinjiang are “vocational” education centres aimed at training and skill development and help integrate people into the Chinese society and aid in combating “extremism”. Disagreeing with this claim, specialist on Central Asian affairs Farangis Najibullah has opined that there is extensive evidence that ethnic Uyghurs are being kept against their will. In fact contrary to the contention of China, the United Nations stated in 2018 that one million ethnic Uyghurs and other mostly Muslim, Turkic-speaking indigenous people in Xinjiang were being forcibly held in what is described as “counter-extremism centres”.

Thus the USA is an emerging power in promoting its geostrategic and economic relations with Central Asia.

China Factor 

China being a neighbour of the CAS has promoted setting up organisations such as the Shanghai Cooperation Organisation (SCO) to strengthen its economic and political ties at bilateral and regional levels. Having achieved high sustained economic growth during the last two decades, China has become a strong global economic power house. This has helped China to promote its own national geo-economic and geopolitical interests in Central Asia which is evident from the following.

First, China has a keen objective for increasing investments in Central Asia as part of its Belt and Road Initiative for promoting its connectivity and transport to enhance its economic interest. Moreover, China is bankrolling infra-structure projects—such as energy pipe-lines, railway networks, and roads—throughout Central Asia as it seeks to increase its influence in the energy-rich region and expand trade.

 Secondly, Kazakhstan, which is the largest country in Central Asia with huge natural resources, has during the last few years approved proposals to build 55 industrial facilities with Chinese financing. As per some sources, of projects “worth a total of $ 3.9 billon, 15 projects have been launched in several sectors, including agriculture, the chemical industry, oil and gas, [and] transport”. According to former President Nazarbaev, Chinese companies produce more than 20 per cent of Kazakhstan’s oil and that some 1200 enterprises in Kazakhstan operate with Chinese capital.

Kazakhstan has emerged as a key to Beijing’s “project of the century”—a $1 trillion worldwide infrastructure programme known as One Belt, One Road in Central Asia. This initiative aims to revive the Ancient Silk Road and build up other trading routes with massive infrastructure projects connecting China with Europe through Central Asia. Critics, however, warn that the One Belt, One Road initiative mostly benefits Chinese companies and banks, pumping Chinese goods into world markets.

Thirdly, as opined by Bruce Pannier an expert on Russia and CAS, China’s dealings with Turkmenistan have always been somewhat opaque. But the China National Petroleum Corp is the only foreign company with a sizable onshore gas-and-oil-field contract in Turkmenistan which will export some 55 bcm of gas to China annually. That would make it China’s largest supplier of gas having constructed a pipeline from Turkmenistan to China passing through other CAS. While Turkmenistan will earn petrodollars it will still owe debt to China amounting to several billion dollars

Fourthly, it is a matter of great significance that apart from coal, oil and minerals, China is interested in precious minerals such as gold and silver of Central Asia. This is evident from the fact that on October 4, 2019 the Tajik Parliament approved a contract signed by the State Committee on Investments and State Property and China’s Kashgar Xinyi Dadi Mining Investment Company in June to develop the Yakjilva silver deposit in the remote eastern district of Murghob. According to experts, this Yakjilva mine has 415 tons of silver deposits.

In fact prior to that in 2007, China’s Zijin Mining acquired 75 per cent of equity stake in the Zarafshon gold mine in northwestern Tajikistan which has an estimated 429 tons of gold deposits. The gold there reportedly accounts for more than 70 per cent of the total amount of gold production in the country. China’s mining companies are major stakeholders in Tajikistan’s largest gold mines in the Panjakent, Aini, and Vahdat regions. China continues to play a major role in its much smaller neighbour’s precious ore ambitions.

From the perspective of the government it is advantageous getting much-needed foreign investment and creates much-needed jobs and generates revenues for the state. Apart from that the projects are significant since Tajikistan owes China $1.2 billion, nearly half of the country’s foreign debts of $2.9 billion.

Fifthly, China is the major trading partner of all CAS and enjoys huge trade surplus with each of them. For instance, the Kazakh-China trade turnover was $10.5 billion in 2017 and it is expected to reach $ 20 billion by 2020.

Sixth, in contrast to the claims of governments and their policies, few analysts and critics contend these projects are furthering fears of corruption, undue Chinese influence, and excessive reliance on Chinese investment. There is strong resentment among academics and the media in the CAS being critical of the government policies. For instance, there are reports that Chinese companies operating in Central Asia often bring in a majority of their own workers from China, leaving many locals upset that such foreign investments are not helping the local economy by hiring natives. Hence the decision over Yakjilva brought criticism from some social-media users in Tajikistan who expressed concern about “selling out” the country to China.

Hojimuhammad Umarov, a Tajik academic and Dushanbe-based expert, contends that Tajikistan should not sign away the exploration rights of its mineral reserves to foreign companies since these resources belong to the Tajik people who need these riches for the future. Supporting this contention, as opined by Farangis Najibullah and Parvez Mullokpmpv, there was not much transparency in the deals and with such investments the country will be increasingly dependent on China which can have control over mineral resources.

Seventh, critics say major investments never reach most of Kazakhstan’s 18 million people. Hence on September 21, 2019 about 60 people gathered to voice their protest against Chinese investment. There was a wave of demonstrations since the first week of September starting with a rally in Zhanaozen that quickly spread to other Kazakh cities. The acuteness of displeasure among the people was evident from the fact that demonstrators were carrying banners “End Chinese expansion” and “No to Chinese factories”.

The feeling of dissent was so strong that protesters demanded that President Qasym-Zhomart Toqaev should scrap his proposed trip to China amid concerns over what they called growing Chinese influence in resource-rich Kazakhstan. Despite that Kazakh President Qasym-Zhomart Toqaev went ahead with his trip to China in September 2019 while dozens of people were sentenced to two-week detentions for taking part in unsanctioned demonstrations.

Eighth, Nurgaliev and Zhumagaliev are outspoken campaigners for the rights of workers in Zhanaozen and they often raise social issues, such as low wages and widespread unemployment. Equally important is the fact that in the interest of economic development of the country, critics and demonstrators urged the government to seek investments in Europe, Japan, and the United States, who, they know “do not bring tens of thousands of their compatriots to Kazakhstan along with their investments like Chinese companies do”.

Moreover, notwithstanding some benefits to the CAS, some analysts express concern about the so-called “debt-trap diplomacy” by China in Central Asia. For instance, according to official statistics, Kazakhstan’s debt to China in 2018 was about $12.3 billion. Hence it is a matter of significance that the former Kazakh ambassador to China, Murat Avezov, disagreeing with the policy of the present government has warned that such a policy could bring “grave consequences” and even jeopardise the country’s independence. He has opined: “China has a huge population and not enough land. China needs land to accommodate its population, and therefore it is constantly looking for different solutions.”

From what is stated above it is evident that China is masterful in defending its own interests by strengthening S2S ties despite public discontent and has been emerging as a dominant player in Central Asia.

Dr R.G. Gidadhubli is a Professor and former Director, Centre for Central Eurasian Studies, University of Mumbai.?

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