Strategic embrace

Strategic ties between Russia and China, driven by economic and geopolitical compulsions, are growing apace, prompting some analysts to warn of greater risks for Russia.

Chinese President Hu Jintao leads Russian President Vladimir Putin (left) to the opening ceremony of the Shanghai Cooperation Organisation summit at the Great Hall of the People in Beijing on June 5, 2012.

RUSSIA’S new push for closer strategic ties with China is gaining momentum. Major deals in two critical areas, energy and defence, are already in the pipeline.

When China’s new leader Xi Jinping visits Moscow this month, the two sides are expected to sign an agreement to increase Russian oil deliveries to China by more than 60 per cent from the current level of 15 million tonnes. Russian officials said crude shipments to China could eventually grow to 50 million tonnes.

Going by official statements in Moscow and Beijing, the two countries are close to breaking the deadlock over price in the long-winding talks on the supply of Russian natural gas to China. The two sides hope to sign a contract by the end of the year for the transport of 38 billion cubic metres of gas through a pipeline along the Pacific coast. Russian supplies will account for 30 per cent of China’s gas needs.

In another major development, Russia is resuming the supply of advanced weapons platforms to China. In December 2012, Russia concluded a framework agreement with China for the sale of four Amur-1650 diesel submarines. Earlier this year, the two countries signed an intergovernmental agreement for the supply of Russia’s latest Sukhoi Su-35 long-range fighter planes. If the deals go through, for the first time in a decade Russia will deliver offensive weapons to China.

Relations between Russia and China have followed an upward trajectory ever since they were normalised in the late 1980s under Soviet President Mikhail Gorbachev after a long period of hostility triggered by an ideological split in the mid-1950s. In 2008, Russia and China removed the last major irritant in their relations, settling the long-running territorial dispute along their 4,300-kilometre-long border.

A new stage in strategic ties between the two countries began with Vladimir Putin’s return to the Kremlin for a third presidential term almost a year ago. Beijing was the first capital outside the former Soviet Union that Putin visited soon after assuming office. The choice of China was loaded with symbolism since it came shortly after Putin skipped a G8 summit in the United States, demonstrating his reluctance to make the U.S. his first overseas destination. For Xi, Moscow will be the first foreign capital he visits as President.

Russia and China are driven closer by economic and geopolitical compulsions. Russia hopes to benefit from China’s insatiable thirst for energy and other resources and diversify its oil and gas export routes away from stagnating Europe. China considers Russia to be part of “strategic rear” along with Central Asia, and its value for Beijing is especially high today when the U.S. is mounting its “pivot” towards Asia.

Russia and China are drawing closer at a time when their relations with the U.S. have run into rough waters. Moscow is deeply disappointed with U.S. President Barack Obama’s policy of “reset”, seeing it as an instrument for winning unilateral concessions from Russia on Iran, Afghanistan and Libya, while refusing to heed Russia’s concerns over the U.S. global missile defence, tone down criticism of Russia’s human rights record, and ease access to high technologies of the U.S.

Beijing sees Obama’s strategic redeployment in the Asia-Pacific region as aimed at containing China. The U.S. support for Japan in its territorial dispute with China has only strengthened Chinese suspicions. Moscow and Beijing have achieved unprecedented coordination on all major issues of global politics, including Iran, Syria, Afghanistan and North Korea. It is in the sphere of defence that strong Russian-Chinese relations come out most graphically.

Arms export In the 1990s and early 2000s, cash-strapped Russia sold aircraft, ships and other weapons worth $26 billion to China. The sales were dictated by economic necessity rather than strategic considerations. Without the Chinese and Indian contracts, the Russian defence industry would have died as the Russian army had no money to buy weapons. In later years, Russian arms sales to China declined because the Chinese industry mastered the production of clones and the modification of Russian systems. For its part, Moscow became far more cautious about supplying cutting-edge defence technologies to China and turned down Beijing’s requests for more advanced weapons.

However, today Russian experts tend to think that China’s ability to copy critical technologies, such as aircraft engines, has been overrated in Moscow. “Chinese aircraft engines, which are essentially modified versions of Russian engines, are way too inferior to the originals, and China continues to depend on the supply of Russian engines,” Vasily Kashin, an expert on China, said.

The sale of Amur-1650 and Su-35 marks a turnaround in Russia’s China arms export policy.

“When and if China succeeds in copying Russia’s new weapons platforms, the Russian industry will hopefully move ahead with new technologies,” Kashin said.

Resumption of large-scale weapons sales to China is essentially a political decision, as the Russian defence industry today has its books full with orders from the Russian armed forces under a $700-billion rearmament programme launched two years ago. It is part of a foreign policy strategy Putin formulated for his new six-year term in the Kremlin in an election campaign manifesto a year ago, about which he said:

“I am convinced that China’s economic growth is by no means a threat, but a challenge that carries colossal potential for business cooperation—a chance to catch the Chinese wind in the sails of our economy.” The Russian leader explained why Russia stood to gain from deeper ties with China. First, China’s potential would help Russia “develop the economy of Siberia and the Russian far east”. Second, China “shares our vision of the emerging equitable world order”, and the two countries “work together to solve acute regional and global problems”. Lastly, Russia and China had resolved “all the major political issues” between them, including the border disputes.

China has already overtaken Germany as Russia’s top commercial partner, with bilateral trade expected to touch $90 billion this year and soar to $200 billion by 2020. There is a geopolitical aspect to the Russia-China axis, which Putin chose to omit. “The balance of power between America and China will to a large extent depend on whether and on which side Russia will play,” the foreign policy analyst Fyodor Lukyanov said.

The renewal of Russian sales of advanced weapons to China may be an indication on whose side Moscow has decided to stay. American analysts are already ringing the alarm bells. “The sales of advanced new equipment, otherwise unavailable from local Chinese industry, could have serious implications for U.S. security commitments in the region,” Wendell Minnick, Asia Bureau Chief of Defence News , wrote in the Washington-based defence weekly newspaper. Quoting Dean Cheng, a research fellow with the Heritage Foundation, Minnick warns of an “enormous and fundamental strategic shift” the Russian arms sales could trigger in the region. “…The introduction of new, quieter subs and the more advanced fighter aircraft calls into question the ability for the U.S. to control the ‘commons’ —that is, airspace and sea space. Future conflicts may not see American dominance of air and sea, and certainly should not be assumed as a given,” Minnick quoted Dean Cheng.

Ironically, the new Russian arms sales to China could ricochet against India, Russia’s most trusted defence partner. For the first time, Russia is going to sell China more powerful weapons platforms than those it has supplied to India. The Amur submarine is far more silent and powerful than the Kilo-class submarines the Indian Navy has in its inventory. India’s Su-30MKI will be no match for China’s Su-35, which is powered by a higher thrust engine and possesses more sophisticated radar, avionics and weapons, according to Konstantin Makienko, a leading Russian military expert with the Centre for Analysis of Strategies and Technologies.

For the same reason, China’s acquisition of Su-35s will knock down the value of India’s planned purchase of the French Rafale, Makienko said. At the same time, he believes that India is in a position to retain its edge in military aviation vis-a-vis China if it speeds up the development of a fifth-generation fighter plane with Russia and goes for in-depth upgrade of its fleet of Su-30MKI fighters.

Risks for Russia Some analysts think that the Russia-China camaraderie poses far greater risks for Russia itself. They argue that demographic pressures and the growing need for resources may push China to turn the Russian-built weapons against Russia. “We should stop selling them the rope to hang us with,” said Alexander Khramchikhin of the Institute for Political and Military Analysis.

Other experts believe that China will not need to resort to arms to conquer Russia through demographic and economic expansion. The Russian far east, which constitutes 40 per cent of the country’s territory, has a shrinking population of 6.5 million, whereas three contiguous regions of China have more than 100 million people.

Demographic threats In a rare recognition of demographic threats, Prime Minister Dmitry Medvedev warned in August 2012 that the sparsely populated far-eastern region should be protected “from the excessive expansion of people from neighbouring countries”.

The structure of trade between Russia and China prompts fears of Chinese colonisation. Russia ships oil, timber, metals and other commodities to China, and imports machinery and consumer goods.

“If the current economic trends persist, it is very likely that Russia east of the Urals and later the whole country will turn into an appendage of China—first as a warehouse of resources and then economically and politically. This will happen without any ‘aggressive’ or hostile efforts by China, it will happen by default,” wrote the respected political scientist Sergey Karaganov.

There has been little evidence so far of any serious effort to change the prevailing pattern of economic ties. In 2009, Russia and China signed a nine-year economic cooperation agreement, which provides for stepped-up supplies of Russian raw materials to China, where they would be processed into manufactured goods for export back to Russia.

Alexei Yablokov, a prominent Russian environmentalist, denounced the pact as “humiliating” for Russia and said it would reduce eastern Siberia and the far east, which constitute roughly half of Russia’s territory, to a “raw material appendage of China”.

Russian strategists have criticised the Kremlin for pursuing a China-centrist policy after the break-up of the Soviet Union and urged Moscow to balance its tight embrace of China with active engagement of other Asia-Pacific nations.

Last September, Russia announced its own pivot to Asia by hosting a summit of the Asia-Pacific Economic Cooperation forum in Vladivostok. Moscow is trying to reach out to Japan, strengthen relations with South Korea and revamp strategic bonds with Vietnam. In early March, Russia’s Defence Minister Sergei Shoigu visited Myanmar and Vietnam, vowing to boost defence ties with both countries.

Russia must rediscover itself “as a Euro-Pacific nation and look not only across the river to China, but also across the sea to Japan and Korea as well as across the ocean to North America and Australia,” Dmitry Trenin of the Moscow Carnegie Centre said.