China, Gwadar and Sea Lanes of Communication: ‘Economic Offence’ or ‘Active Defence’?

25 Feb, 2013    ·   3823

Shanta-Maree Surendran analyses the nature of China's port policy in light of recent developments

Shanta Maree Surendran
Shanta Maree Surendran
Research Intern

In February 2013, the Pakistan government handed over control of Gwadar port to China. The desolate surrounds and negligible shipping activity at Gwadar belie the port’s central role in renewed debate about intentions and implications of China’s interest in the Indian Ocean Region. Is China’s investment in Gwadar indicative of a trade and resources agenda or a military one, and are these mutually exclusive?

China's Port Policy: Plan First, Plan Ahead
China’s port policy focuses on energy and economic interests. This aligns with national objectives centring on growth and stability (China’s White Paper, 2010). Transport development and securing access to resources and trade are prioritised as part of a pragmatic and proactive approach to achieving national objectives. The method espoused and practiced by China to accomplish increased efficiency, economy and safety of transport has been a ‘plan first, plan ahead’ strategy (Zuyuan, 2008). The priorities were initially nationally focused but now also extend to international behaviour and action.

Sea lanes of communication (SLOC) are critical to China’s growth and stability. 90% of China’s foreign trade is carried by sea and over 80% of her oil imports arrive through the Malaccan Strait. A ‘plan first, plan ahead’ strategy has seen China focus on SLOC to secure access and position so as to facilitate long-term progress and protection.

China’s port policy, and the associated objectives, in itself does not present a threat. It is the tacit military dimension to the policy that ignites speculation and debate. China’s National Defence document states: ‘The state takes economic development and national defence building into simultaneous consideration’ (China’s White Paper 2010: 7). Simultaneous consideration does not necessarily equate to simultaneous action but the pairing of these two elements, in both cultural doctrine as well as official documents, suggests that observers of China’s economic-driven activity would be wise to acknowledge military development as an implicit companion. This partnership cautions wariness regarding Chinese management of Gwadar port.

Gwadar Transfer
The most oft cited reason for what brought about the transfer of Gwadar from Singapore’s PSA International Ltd to a Chinese government company is the negotiations failure between PSA and the Pakistan Navy. The stalemate, over land required for the development of the port, stalled the project and stifled commercial activity.

China had expressed prior interest in the port as an avenue to realise transport development objectives. When the PSA terms of contract expired, the Chinese government company was offered operational control. China’s investment has injected new enthusiasm into discussion of the potentials for Gwadar, and it is the port’s limitations as much as its promise that keeps the engine of this argument fuelled.

Economic Opportunities
The economic and energy benefits of access to Gwadar lie in the strategic value of its geography. Situated near the Strait of Hormuz, the Arabian Sea port offers China energy resource access and a trade pathway that bypasses the congested Malaccan Strait. The option of a direct land route into Western China lessens the vulnerability that comes with heavy reliance on the South East Asian sea route.

The geographical advantages inherent in this lend support to China’s assertion that strategic intentions are focused on economic interests and energy planning. However, these perspectives assume that integral infrastructure developments needed at Gwadar are achievable. The history of official neglect and resulting disparity in the area has fostered insurgent unrest, which analysts cite as imperative to address before any progress can be undertaken. Rail and road link projects have been disrupted by separatist elements and the cost of using this port as a bypass would be unfeasible in the short term. Once a land connection is finalised the cost of ensuring security of transport via this link may also impact the economic viability of the option. For these reasons Gwadar requires a long-term commitment in order to achieve economic gain.

Whilst a ‘plan first, plan ahead’ approach can offer justification for this investment, the difficulties associated with using Gwadar as a commercial port strengthen the argument that a military destiny, rather than an economic one, is intended.

Active Defence
‘Active Defence’ is the strategy promoted by China to achieve national defence objectives. Management of Gwadar enables greater presence and influence in the Indian Ocean Region, as well as a listening post to enable monitoring of the Hormuz Strait. Both outcomes offer an opportunity to engage in active defence.

The potential for proxy dynamics, through support of Pakistan, as well the prospect of Chinese navy ships having access to a proximate base may be considerations driving India’s investment in the nearby Iranian port, Chabahar. The chances of imminent activity are negligible but energy, economics and defence will be an enduring trinity in a globalised world and events must be considered and responded to in this context.

China’s ‘plan first, plan ahead’ strategy is as relevant to military as to economy. An inclusive approach to prosperity and military outcomes explains both economic and naval potentials. ‘Enriching of the nation’ through a strong and efficient economy is integral to ‘strengthening the army’ with capability and readiness. A fully functioning Gwadar port would service both.