Geo-Strategic Developments


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US Strategic Framework for the Indo-Pacific

The US government declassified the 2018 Strategic Framework for the Indo-Pacific, which considers India as the central pillar to counteract Chinese influence in the region. China reacted strongly to the document.

The US seeks to “maintain US strategic primacy in the Indo-Pacific Region” and “prevent China from establishing new, illiberal spheres of influence.” The document says “a strong India, in cooperation with like-minded countries, would act as a counterbalance to China.”

US is supporting India’s rise “as a provider of net security and Major Defense Partner” and recognizes its preeminent role in South and Southeast Asia. However, India’s usefulness is

seen  primarily  in  reference  to  countering  China’s  growing  influence.   According to the document, US considers Bangladesh, Maldives and Sri Lanka as partners and has sought to work closely with them, particularly because of the significance of maritime security.

US relations with Nepali Army will likely be guided by the Framework and will have implications for counterintelligence, cyber security, and management of classified information. Nepali Army will face pressure from US allies, if there is a trend in Nepal to create a Chinese model of government or if the government grows close to China.

US will likely work with India, Japan, UK and Australia in Nepal to finance projects that enhance regional connectivity with India and Bangladesh. India and the US are tracking Chinese investments and financial interests in Nepal. Nepal’s political parties may see gradual polarization to reflect the cold war between US and China. India’s role and position would be crucial in this process.

South Asian regional dynamics

US relations with Sri Lanka appeared to have backslid. In December, the US withdrew

USD 480 million MCC grant to Sri Lanka citing lack of “partner country engagement.” It was interpreted by the media as a sign that the US was not happy with growing ties between Sri Lanka and China. Global Times said the US was also trying to pit Nepal and Bangladesh against China.

The US and the Maldives held the inaugural dialogue on defense and security in January following the framework signed in September last year. According to a US Indo-Pacific Command statement, the framework focuses on four areas: exercises, logistics, information sharing and professional military education. In the latest meet, both sides “reaffirmed their shared commitment to a free and open Indo-Pacific region and agreed on activities in 2021 that will advance shared priorities such as maritime security, counterterrorism, humanitarian assistance and disaster relief.”

Vaccine Diplomacy

China is pushing back against the US and India, who are using COVID-19 investigations and vaccine diplomacy to weaken Chinese interests. Chinese experts are calling for WHO investigations on COVID-19 in the US, expressing concerns about India’s attempts to push its vaccine and contain SinoVac trials in Bangladesh. India provided 600,000 vials of vials produced by Astra Zeneca to Sri Lanka in late January. Global Times claims that India is meddling on China’s efforts to conduct clinical trials in Bangladesh for its SinoVac vaccine.  China’s efforts to use vaccine diplomacy has backfired globally.

US Foreign Policy

US President Joseph Biden sought to reposition US foreign policy in the global stage by placing human rights and democratic alliances at the center.

Earlier, US Secretary of State Anthony Blinken criticized Russia and said China was the “most significant challenge to us of any other country.” His speech indicated that US is counting on stronger alliances and remedying its weaknesses (not pulling back and adopting proper military postures) in order to negotiate with China from a “position of strength.” Blinken also talked about the need to put pressure on China regarding human rights issues in Hong Kong and Xinjiang.

Similarly, US Defence Secretary Lloyd Austin spoke to his counterparts in Japan, Australia, and India after assuming office and said the US will continue Trump’s Indo Pacific Strategy.

Analysts in the US say, managing Xi Jinping would provide a new test for US, as it poses risks comparable to the Cuban crisis. Views of the US was highlighted by the publication of an anonymous “The Longer Telegram” published by the Atlantic Council, which argues that China led by Xi Jinping is the “single most important challenge facing the United States.” The piece argues that the US should try to create a schism between Xi Jinping (including his inner circle) and China’s ruling elites (Chinese Communist Party).

Chinese experts believe that the US administration has adopted selective multilateralism

that will only include “democratic” allies, excluding countries like China.


A senior Chinese official gave a speech on China-US relations on February 2, which was interpreted as a “pragmatic route map” to fox bilateral relations. Yang Jiechi, a member of the Political Bureau of the Communist Party of China Central Committee and director of the Office of the Central Commission for Foreign Affairs, offered cooperation on issues of common interest like fight against COVID-19, economic recovery and climate change. While significant differences persist on many issues, including politics, China is offering cooperation on issues like renewable energy and low-carbon technology, sustainable development, military, law enforcement, drug control and cybersecurity, as well as cooperation at the UN, the World Health Organization, the G20, APEC and other multilateral platforms.

Chinese experts feel that the US is meddling on Taiwan, Hong Kong, and the two autonomous regions of Xinjiang and Tibet. Chinese experts, however, are divided as how to perceive the Biden administration. Some perceive a softer stance from the new administration, with any hard position interpreted as an attempt to please the US audience. While others feel that the new administration is not fixing US-China ties but merely “adjusting Trump’s China policy to … better serve the US interests.” Meanwhile, China flew military airplanes over Taiwan Strait in a show of force meant as a message to the United States.

China hosted the China Tibet Trans-Himalaya Forum for International Cooperation where it called on the US for multilateralism to address climate-change issues. This was the third forum hosted by the Tibetan government, which is “aiming to facilitate regional connectivity, communications and cooperation.”

After conflict with India, China has completed 3-D spatial mapping of its western terrain with centimeter-level accuracy. It will allow China to monitor the region at all times with remote sensing satellites. China has developed and deployed Type 15 light tanks that are suitable for combat in high altitude plateaus.

China’s economy will continue to grow. According to IMF, China’s economy will grow by 8.1 percent in 2021, and 5.6 percent in 2022. The difference in growth between western countries and China’s is primarily due to COVID-19.

India-China Conflict

India-China relations have worsened in recent months, with the face-off in Kashmir region signifying the current state of affairs. Recent incidents in Sikkim have complicated efforts at de-escalation. Differences between China and India increased after China constructed a village in southern Tibet near disputed border with India’s Arunachal Pradesh.

Chinese experts believe that Sino-India relations will not improve in 2021. The ninth

Round of India-China Corps Commander Level dialogue on border dispute agreed to push for an early disengagement, but Chinese officials believe that, despite the talks, the face-offs between the two countries would continue in spring after weather improves.

While  China  is  attempting  to  separate  border  issues  with  bilateral  relations,  India  is insistent that bilateral relations cannot move ahead without resolving border disputes. Saying India was now at a cross-roads in its relations with China, India’s Foreign Minister S Jaishankar outlined eight principles for improving ties with China. Jaishankar’s speech raised hopes in China.

India and China’s relations will depend to a great extent on US policies. Will the Biden administration keep on supporting India and prioritize the Indo-Pacific? If Biden’s China policy becomes more moderate, which the Chinese are hoping, it will dent India’s ability to take a hardline stance against China. But news coverage so far indicate that US will be backing India fully.

According to Bloomberg, India’s efforts at military modernization is facing crisis. As its economy contracted by almost 8%, India was able to only modestly increase military expenditure to INR 3.47 trillion. Most of the increase is likely to be used up managing border conflict with China, whose military expenditure is almost four times bigger. India currently depends on imports to advance military weapons and technology.

Under domestic pressure, conflict with China offers Modi government an excuse that helps deflect criticism. India has permanently banned 59 Chinese apps, which has not gone well with the Chinese.25 Chinese embassy in Delhi asked India to stop doing more harm and engage in cooperation with China.

Although imports from China decreased by almost 20 percent in 2020, India’s efforts to put pressure on China by banning or boycotting Chinese imports has largely failed.

Other issues

Digital currency and geopolitical rivalry

China and India are intensifying efforts to control private digital currencies like Bitcoin and to introduce official digital currencies. China cracked down on Jack Ma and Tencent after perceiving their financial activities (eg, Alipay and WeChat Pay) as a threat to the country’s existing financial system. China’s official digital Yuan will limit the influence of such companies. China’s efforts to introduce a digital Yuan is seen as a direct threat to the traditional financial hegemony led by the US dollar and its geopolitical power. At present discussions are underway to create an international digital currency reserve system. Chinese experts believe that India lags far behind in its economic capability to introduce a digital currency of its own or become a global player.


UK appears to be moving closer to US in terms of foreign policy. UK is planning to convert the G-7 summit meeting into a D-10 (Democratic 10) club, which includes India, South Korea and Australia. China, like some European countries, feels the D-10 is an anti-China move.

A British think-tank, Chatham house released a new report, “Global Britain, global broker A blueprint for the UK’s future international role” in January 2021. The report claims Britain has ceded space to the EU as the US’s main counterpart, and that “China, India, Saudi Arabia and Turkey – may be important to the UK’s commercial interests, but they will be rivals.” The report also recommends that rather than going for a “catchy” Democratic-10 group, UK should engage with mid-sized G20 democracies.

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