The Quadrilateral Security Dialogue (Quad) of four countries, Japan, the US, Australia and India, was formed in 2007 with the initiative coming from Japanese PM Shinzo Abe. Due to a lack of participation and no proper institutional framework, it remained dormant for quite some time.
By realising the threat China’s expansionist policy is causing, in November 2017, India, the US, Australia and Japan developed a new strategy to keep the critical sea routes in the Indo-Pacific free of any influence, especially Beijing’s. The aim of the Quad is to support a “free, open and prosperous” Indo-Pacific region that China seeks to threaten.
In November 2020, the Quad conducted Malabar Naval drills in the Indian Ocean. In response, China affirmed that the activities of the Quad do not affect it; however it is actually keeping a close eye on it. Beijing has emerged as the most important trading partner of the Indian Ocean region, accounting for 16.1% of its total goods trade in 2017, up from 4.8% in 2000.
Quad vs Belt and Road Initiative (BRI): The BRI promises economic security but not human security by providing funds to developing countries with a debt trap. Herein, the Quad can play a vital role as it is a group of democratic countries. It should provide a choice to the nations as to where they want to borrow the money for development purposes from and also be a part of the supply chain.
This looks all positive, but China would definitely react and take some action against this. Therefore, the members should think, plan and prepare for retaliation. A possible way adopted by China to tackle this challenge could be the ‘Divide and Rule’ policy, which would simply mean creating conflicts among the members and reducing the pace of the activities of the group.
India’s Maritime Policy & Quad: India’s maritime policy has been dependent on China’s plans in the Indian Ocean. The South China Sea has been the dominant shipping route in Asia and harbours huge natural gas resources. Naturally, China has been looking to tap these resources and ensure that it asserts its dominance in the region. Thus, Beijing has invested heavily in the East Indian Ocean region all the way up to Djibouti and Port Sudan.
Examples of this are the Hambantota port and Colombo Port City projects in Sri Lanka. China has acquired the Hambantota port from Sri Lanka in lieu of the debt provided. It made investments worth $1.12 billion in the port. Loans obtained for constructing the port and the money obtained from the lease were used by Sri Lanka to strengthen its foreign reserves, not to repay. Although the port has been leased to China for 99 years, there was no cancellation of debt.
The Colombo Port City Project showed another version where the Chinese public company brought its own labourers to build the port instead of Sri Lankan ones. Further, China started the construction of a deep-water port at Kyaukpyu in Myanmar and leased the island of Feydhoo Finolhu in the Maldives and the Gwadar port in Pakistan.
India needs to develop positive relations with its neighbours that have already been tapped by China. Uncertainty regarding India’s policy with Bangladesh and vice versa has left a void that Beijing is filling, and China’s investments in Dhaka have increased over the years. With Saudi Arabia and the UAE shying away from Pakistan, the nation has been largely dependent on Chinese resources to sustain its economy. However, several important projects of the China Pakistan Economic Corridor (CPEC) are now stalled or running behind schedule due to a lack of financing.
Of 122 announced CPEC projects, only 32 have been completed as of the third quarter of the fiscal year 2020-21. The Quad needs to be institutionalised and given a formal structure where India needs to be the aggressor. The advantage that India has when it comes to the Quad is that the other members are geographically cut off from the Indian Ocean region. The only nation with big-enough naval power to rival China in this area is India and thus it can bring peace, stability and security in the region.
China has been facing an internal debt crisis due to the overlending of funds to the BRI and therefore, has been restricting the expenditure the way it did for CPEC in Pakistan. Citing data compiled by Boston University, researchers note that overall lending by the state-backed China Development Bank and the Export Import Bank of China declined from a peak of $75 billion in 2016 to just $4 billion in 2019. Further, experts suggest China would be most likely to adopt a new approach to fund the BRI through multilateral bodies such as the Asian Infrastructure Investment Bank to reduce the debt burden.
Similarly, Quad members can benefit from pooling resources, which will benefit India in expanding its scope in the Indo-Pacific without the extra burden of foreign policy spending on the economy. It is up to the members to take proactive steps to come together in these conducive times when China is also reeling under world pressure due to its involvement in the Covid-19 outbreak.
A sustained movement to limit China’s expansionist policy by the Quad will set a precedent for the European Union as well. Such a precedent will go a long way in undermining China’s threats and policies on the international stage.
Assistant Professor of Economics, Savitribai Phule Pune University
Founder of TTC Media Pvt Ltd