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#5356, 6 September 2017
China's Indian Ocean Strategy
Tapan Bharadwaj
Researcher, CRP, IPCS

China is a regional maritime power in East Asian waters, and is increasing its presence in the Indian Ocean Region (IOR). This rising presence depicts a pattern that is aimed to achieve its immediate maritime goal of multi-regional power projection capabilities. As the world's second largest economy, currently growing at the rate of around 6.5 per cent, China aims to enhance its naval power profile in accordance with its overall power profile.

Maritime power is an essential element of President Xi Jinping’s 'China Dream'. This was also reflected in China’s latest (2015) defence white paper, 'China’s Military Strategy': “The traditional mentality that land outweighs sea must be abandoned, and great importance has to be attached to managing the seas and oceans and protecting maritime rights and interests.”

China’s IOR Strategy

China’s strategy for its presence in the IOR has two dimensions. First, China is building ports in strategically locations ofthe IOR. For example, on 1 August 2017, China formally opened its first overseas military base in Djibouti. China also signed a US$ 1.1 billion deal on 30 July 2017 with Sri Lanka and acquired a 69.55 per cent stake in the Hambantota Port. It is looking at a stake of up to 85 per cent in Kyauk Pyu, a deep-sea port in the Bay of Bengal in Myanmar. Although Sri Lanka, as per the conditions of the 99-year lease agreement, has ensured that its own navy will be responsible for Hambantota's security, Myanmar may not be able reach the same compromise with China. It is also speculated that China will soon build military bases, similar to one in Djibouti, in Pakistan.

Second, the People’s Liberation Army Navy (PLAN) most likely intends to use these facilities as forward naval bases in the future, although such developments are currently held back by technical challenges. China’s defence spending - up to US$ 152 billion in the 2017 defence budget - has seen a 7 per cent increase. Much of the money is expected to go towards the development of the navy. Chinese naval experts such as Yin Zhuo, a PLAN rear admiral, have repeatedly indicated that PLAN needs at least 5 or 6 aircraft-carriers to fulfill its maritime ambitions - this would require even more funding. On 13 March 2017, a South China Morning Post news report cited military insiders and experts saying that China plans to increase the size of its marine corps from about 20,000 to 100,000 personnel, who will be called on to protect the country’s maritime lifelines and its growing interests overseas.

Current Status

Security concerns in the IOR are principally governed by the presence of the US, France and India, without any major conflict of interest. China is increasing its presence with an eye on cultivating strategic interests in the region but unlike the South China Sea (SCS) and East China Sea (ECS), which feature in its core objective dynamics, the IOR is not yet a priority. However, this could soon change. China views economic growth an essential attribute of its great power status, and the Sea Lanes Of Communications (SLOC) present in the IOR are considered crucial for its energy imports and mercantile trade. Hence, as it grows economically, it stands to reason that the IOR will begin to feature prominently in its core objectives.

The IOR features in China’s ‘far seas’ ambitions, dictated by the belief that China must be able to protect its vital SLOCs and many other political and economic overseas interests, including Chinese citizens deployed abroad. However, it is clear that China wants to become a maritime power to not only secure its economic and security interests, but also to gain strategic capital through a strong naval presence in strategically important waters. It is important to remember that the economic growth of other East Asian and Southeast Asian countries is similarly dependent upon the IOR, and China is in conflict with most of these countries on one or the other issue.

Today, China has world-class merchant marine and fishing fleets, a globally recognised shipbuilding capacity, a large and effective coast guard, and an ability to harvest or extract economically important maritime resources. However, due to the long-term imposition of the US/EU arms embargo, absence of domestic expertise for manufacturing advanced naval equipment, and Russia’s incompetence in developing and exporting advanced naval technologies especially in the fields of gas turbine propulsion and naval electronics, China lacks power projection capabilities in the ‘far seas’.

Building ports in important locations of the IOR appears to be working in cash-rich China’s favour. However, PLAN’s intentions to use these facilities as forward naval bases in the future faces challenges, and there have been almost no concrete achievements so far. Hence, for China to become an active member in the current maritime security architecture in the IOR, it must seek to earn the goodwill of the US, France, and India. The best way to do this is to stop confronting or attempting to 'bully' India and the US and its regional allies in the areas of its larger influence, i.e. SCS and ECS.

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