India-China Tensions Spike in the Himalayas

Japan after Abe; China-Myanmar projects; Indian economy

The Big One.

High-altitude, high-stakes competition.

Pangong Lake, Pangong Tso, Ladakh, India

Author’s Note: It’s good to be back, readers. Apologies for the hiatus as I transition into a new role at The Diplomat as editor-at-large. This newsletter will continue, but there’ll be a greater emphasis on connecting readers to the excellent analysis that we have ongoing at The Diplomat. 

Between October 20, 1975 and June 15, 2020, no Indian or Chinese troops died along the two countries’ disputed border. That changed on June 15, when 20 Indians and an unknown number of Chinese soldiers were killed in a brawl. In recent days, the situation has heated up again, with another reported Indian casualty, ending a 76-day period without any deaths. As Ajai Shukla reported recently, Nyima Tenzin of India’s Special Frontier Force (SFF), an elite border unit, was killed in a shadowy operation. 

The tactical situation around Pangong Tso—one of the many simmering standoff points along the Line of Actual Control in Eastern Ladakh—has changed following Indian moves in recent days. Indian forces have assumed control of the heights on the southern bank of the lake, apparently catching the PLA off-guard and drawing protest from China. 

As Bloomberg reports, citing Indian officials, “In what they called India’s first offensive move since the conflict began in May, thousands of soldiers climbed up mountain peaks for about six hours to claim the vantage points along the south bank of Pangong Tso—a glacial lake roughly the size of Singapore.” 

“The action was taken to counter what India saw an intrusion by Chinese forces, the officials said, asking not to be identified due to rules on speaking to the media.” According to Times of India, the Indian Army has also consolidated positions on the north bank, overlooking the first and second “Fingers” (mountainous outcroppings) at the lake. 

Over at The Diplomat, Abhijnan Rej, our new security and defense editor, takes a look at the recent operations and the increased stakes in Ladakh. “Indian actions early this week mark a turning point in the ongoing crisis,” he observes. To many, much of what has happened in Eastern Ladakh over the past four months reminds one of the events leading up to the 1999 India-Pakistan Kargil War, but in slow motion—and with added complexity. For India, the PLA is a better equipped adversary than Pakistan in 1999, of course, and New Delhi still has to contend with shortfalls in equipment, even while its own manpower is quite favorable along the Himalayan border. 

For now, the India-China border remains incredibly tense. We may be in for a long, bitter winter as Indian and Chinese troops attempt to preserve their gains in Ladakh while talks continue at the diplomatic and military levels.

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East Asia.

Declassifying old assurances. Earlier this week, the Trump administration moved to declassify U.S. President Ronald Reagan’s “Six Assurances” to Taiwan. These have been an important component of the U.S.-Taiwan relationship in the aftermath of U.S. normalization of diplomatic relations with China. 

I shared a few thoughts on Twitter on why I think the administration made the move—and why it may even have merit in the context of ongoing shifts across the Taiwan Strait as China makes its hostile intentions toward Taipei clearer than ever. In short, it’s about communicating resolve, but it’s not so clear just how well this step contributes to overall U.S. efforts. But Taiwan does represent a rare area of bipartisan agreement in American foreign policy in Asia today.

Japan’s post-Abe future. Japanese Prime Minister Abe Shinzo’s resignation has opened up a new era in Japanese politics. Abe’s well-known chief cabinet secretary, Suga Yoshihide, is the clear frontrunner and represents for many the “continuity” candidate. Other names include Defense Minister Kono Taro and former Foreign Minister Kishida Fumio, well-known Liberal Democratic Party heavyweights. Whatever happens, the biggest question for me is whether any of these men can come to enjoy the consolidated leadership Abe enjoyed—or whether Tokyo may be doomed to return to the days of revolving-door prime ministerial terms, as was the case between 2006 and 2012. For Japan’s short-term economic and strategic future, the answer to that question will have important implications. Suga, if he comes out on top in the LDP’s leadership election on September 14, may reign as a caretaker while the party navigates broader internal shifts.

South Asia. 

China’s role in India’s Northeast: Avinash Paliwal takes a look at China’s role in fomenting unrest in India’s remote northeast in a two-part series. Read part one here and part two here. Although linkages between Beijing and Indian militant groups exist, Beijing’s ability to exercise assertive control over these groups—or use them as proxies—is limited, Paliwal argues. These groups can be described fairly as clients, at some level, of Chinese beneficence, but not proxies.

The dilemma for China and its Northeast rebel clients, then, is about how to maintain a mutually beneficial relationship. Unlike India’s institutionalization of Tibetan fighters into its national defense fabric (as witnessed in Indian Army’s recent deployment of 7 Vikas Regiment of the Tibetan-dominated Special Frontier Force against China’s People’s Liberation Army at the Pangong Tso), Indian rebels operating from China have no such value for Beijing. Baruah retains a modicum of value as an arms dealer who can channel illicit guns and money to the region. But his history of cheating groups such as the NDFB has bereaved ULFA-I of trust –  an essential but hard-to-find item in this space – among still-active groups.

India’s big economic plunge. India’s GDP declined by 23.9 percent in the year’s second quarter—a shocking contraction for one of the world’s largest emerging economies. The economic contraction, while not unexpected given the dramatic lockdown measures New Delhi took to mitigate the worst public health effects of the pandemic, is likely to persist, with headwinds still ahead. Worst of all, given India’s rising COVID-19 case totals, the efficacy of the early lockdown measures have come under political scrutiny. 

Southeast Asia.

China-Myanmar projects. This week, Yang Jiechi, the head of the Central Foreign Affairs Commission of the Chinese Communist Party, stopped by Myanmar—the highest level visit by a Chinese official in some eight months. Sebastian Strangio, The Diplomat’s new Southeast Asia editor, covered the trip: 

In separate meetings with Myanmar’s State Counselor and de facto leader Aung San Suu Kyi, and its de jure President Win Myint, Yang sought assurances about the implementation of key Belt and Road Initiative (BRI) infrastructure projects. In particular, he focused on the slew of BRI projects gathered under the smaller umbrella of the Cambodia-Myanmar Economic Corridor (CMEC), a planned overland network of highways, railways, pipelines, and industrial zones intended to link China’s Yunnan province to Myanmar’s coast on the Bay of Bengal.

Asia Defense.

2020 China military power report. The U.S. Department of Defense’s congressionally mandated report on Chinese military power was released Tuesday and it’s the longest, most detailed iteration of that document ever. I encourage anyone interested in Chinese military modernization to read—or skim—the entire 200-page document, but I wanted to share a few highlights.

There are two major observations that jumped out to me. First, China’s inventory of dual-capable (nuclear and conventional) intermediate-range ballistic missiles has grown year-on-year from 80 to 200, a remarkable leap. This exclusively encompasses the DF-26 IRBM, the sole missile of its class in the People’s Liberation Army Rocket Force’s inventory. The report has a lot to share on the DF-26’s operational mode, including that the dual-capable system is designed for rapid warhead swapping. 

Separately, the report makes public the U.S. assessment that China’s nuclear warhead totals are in the “low-200s.” That’s significant because the Trump administration has made nuclear arms control with China a major priority of late. The low-200s figure is also significantly lower than open source estimates, which had placed the arsenal around the high-200s (290, per my former Federation of American Scientists colleague, Hans Kristensen).

There are other significant topline observations worth mentioning here. The report, for the first time, includes analysis on the areas that the Department of Defense sees where China has either reached parity with or surpassed the United States. 

For a summary of the report, read The Diplomat’s Steven Stashwick, who underscores the strategic context of China’s military growth and modernization:

In 2017 Chinese President Xi Jinping set out two major goals for the PLA: to complete modernization by 2035 and become a “world class” military by mid-century, presumably prior to the People’s Republic of China (PRC)’s centennial in 2049. The Pentagon isn’t sure what exactly “world class” means in practice (the PRC may not either) but it is confident that China isn’t building up its military for show, stating that “the CCP [Chinese Communist Party] desires the PLA to become a practical instrument of its statecraft with an active role in advancing the PRC’s foreign policy, particularly with respect to the PRC’s increasingly global interests and its aims to revise aspects of the international order.”

Extras.

Space geopolitics and the Asia-Pacific. I spoke to Brian Weeden of the Secure World Foundation about the major players in Asia in space security and the drivers of competition in this critical domain. Listen to the episode here

The September 2020 issue of The Diplomat is here. This month, we explain Europe’s rapidly hardening stance on China in a year that was supposed to represent a high-water mark for the relationship.

We also trace the rise and fall of the Islamic Movement of Uzbekistan and its role in global jihad, evaluate Australia’s bold shift on defense in its latest strategic update, and look back at a tumultuous three years in inter-Korean relations. And, of course, we offer a range of reporting, analysis, and opinion from across the region.

This newsletter is written by Ankit Panda, senior editor for The Diplomat, and director of research at Diplomat Risk Intelligence. Please do feel free to reach out with comments, tips, and feedback at ankit@thediplomat.com and follow me on Twitter at @nktpnd and The Diplomat at @Diplomat_APAC.

US Sanctions Top Chinese Officials: What Now?

Australia’s defense update; Bhutan-China dispute

The Big One.

Top Chinese officials are sanctioned for Xinjiang atrocities.

a man wearing a suit and tie: Xinjiang Party Secretary Chen Quanguo (pictured March 2019) is no stranger to taming ethnic tensions, having previously overseen a clampdown in Tibet following protests and a spate of self-immolations by Buddhist monks in the Himalayan region

The big news this week concerns—as it often does—the U.S.-China relationship, which continues to head into increasingly turbulent waters. On Thursday, the U.S. Department of the Treasury finally did something that’s been advocated by members of Congress and nongovernmental activists for years: it sanctioned senior Chinese officials complicit in the ongoing atrocities against Muslim minorities in China’s Xinjiang Uyghur Autonomous Region (XUAR). 

The officials placed under sanctions include Chen Quanguo (pictured above), the Communist Party Secretary of XUAR and more significantly a member of the 19th Politburo of the Communist Party of China. Other officials covered include Zhu Hailun, a former Deputy Party Secretary of the XUAR, the current Director and Communist Party Secretary of the Xinjiang Public Security Bureau (XPSB), Wang Mingshan, and the former Party Secretary of the XPSB, Huo Liujun. The XPSB itself is included in the sanctions, all of which were enacted pursuant to the Global Magnitsky Human Rights Accountability Act.

The decision is likely to yield a significant reaction from China—in a way that recent U.S. steps to punish Beijing for the enactment of its new national security legislation in Hong Kong had not. Chen Quanguo’s sanctioning, in particular, will not be taken lightly. As a member of the 25-member Politburo, he is among the political titans in China and may even be eligible for eventual elevation to the powerful Politburo Standing Committee, the apex of political power in China. China may react proportionately, with official sanctions of a sort against American officials, or it may undertake “unofficial” punitive actions—perhaps against American citizens on Chinese soil. The experiences of Michael Kovrig and Michael Spavor, two Canadian citizens that were effectively taken hostage after Huawei CFO Meng Wanzhou was arrested, comes to mind. (Disclosure: Kovrig and Spavor are friends; I saw them both in person just weeks before their detention.)

On Friday, Chinese Foreign Ministry spokesperson Zhao Lijian warned that “Xinjiang affairs are entirely China's internal affairs. The US has no right and is in no position to intervene.” He added, “In response to its [US] wrongdoing, China decides to take reciprocal measures against US agencies and individuals with egregious practices on Xinjiang-related issues,” without providing specifics. Details of China’s response should become clear in the coming days. Possibly of note, China’s Global Times recently floated the idea of suing Adrian Zenz, one of the top scholars investigating the Xinjiang rights abuses.

Around two years ago, members of Congress began to push for this idea. My colleague Shannon Tiezzi covered the bipartisan calls at the time. As she noted, despite common talk of sanctions for human rights violations in China—including in the aftermath of the 1989 Tiananmen Square massacre—most American governments didn’t take that step, which would have risked “actually jeopardizing the lucrative trade relationship over human rights concerns.”

The Trump administration’s move, therefore, may have surprised China—although given recent steps over Hong Kong, which were also once seen as unthinkable, perhaps less so. 

Reflecting on Thursday’s sanctions, The Diplomat’s Shannon Tiezzi writes that “the latest announcement is just the culmination of years of pressure from the U.S. Congress for the Trump administration to take action.” She continues:

Members of Congress had been calling for Magnitsky sanctions in response to China’s crackdown in Xinjiang since 2018. Other administration officials, including U.S. Ambassador for International Religious Freedom Sam Brownback, had been urging sanctions as well.

But U.S. President Donald Trump told Axios’ Jonathan Swan last month that he held off on enacting sanctions because “we were in the middle of a major trade deal… And when you’re in the middle of a negotiation and then all of a sudden you start throwing additional sanctions on…” Trump left the thought unfinished, before claiming that the tariffs his administration had enacted on Chinese goods “are far worse than any sanction you can think of.”

Trump’s reluctance to bring up human rights because of his interests in seeking concessions on trade may be one of the most conventional things about how he thinks about this aspect of U.S. China policy. But it also presents probably one of the most potent levers that China can use to get the U.S. administration to back down: by threatening U.S. trade interests. Doing so won’t just hurt the United States, however. It’ll be negative sum, harming China equally—or even somewhat more.

We’ll find out how Beijing will react soon enough.

Diplomat Risk Intelligence.

Diplomat Risk Intelligence offers you dedicated access to an exclusive network of subject matter experts versed in geopolitical, security, economic, and political trends covering the wider Asia-Pacific region. To learn more, click here.

South Asia. 

Bhutan and China’s territorial dispute takes on a new dimension. It’s getting tough to keep track of all of China’s active maritime and territorial disputes; there’s no shortage of headlines from Ladakh, the South China Sea, and the East China Sea. Add now to all this a new dispute with Bhutan.

The Sino-Bhutanese relationship is not well developed. The two countries don’t have formal diplomatic ties and Bhutan has the distinction of being the only country apart from India that has a still-unsettled land border with China. For The Diplomat, I discussed some of the background of this latest twist.

...despite this lack of official relations, the two sides have worked for years to arrive at a resolution to their border disputes, which until now primarily focused on areas in the central and western sectors.

The western sector dispute — over the Doklam plateau — has received the most attention after the 2017 India-China standoff there. The central sector disputes — over areas known as Jakarlung and Pasamlung — have received less attention comparatively. Even without formal diplomatic ties, Bhutan and China have held 24 rounds of border talks between their envoys; talks that have been frozen since their last round in 2016, partly due to the heightened tensions that erupted during the Doklam standoff. A 25th round is yet to take place.

On Saturday, the Chinese Ministry of Foreign Affairs (MFA) issued a statement to two Indian media outlets — the Hindustan Times and The Hindu — highlighting three separate areas of disputed territory with Bhutan. “The boundary between China and Bhutan has never been delimited. There have been disputes over the eastern, central and western sectors for a long time,” the Chinese MFA said, according to The Hindu.

The newly disputed area, which roughly corresponds to the Sakteng Wildlife Sanctuary, is not noted in any official Chinese maps that I’ve been able to find. A sole unofficial map appears to show a dispute in this area (one that I came across in 2017, while working on the India-China dispute at Doklam), but this map contains errors about the disputes in other sectors. I surmise in my above analysis that this dispute with Bhutan may have as much to do with India as it does with Bhutan. 

Tenzing Lamsang, editor of The Bhutanese, a newspaper in Bhutan, sums up the situation nicely from Thimphu’s perspective.

The second point is particularly important. The practicality of the political geography here—including the fact that India administers Arunachal Pradesh—means that the area China now claims is disputed does not even border China-administered territory. To get from Tibet to the eastern part of Bhutan in the Sakteng area, China would need to effectively traverse Indian-held territory.

In case you missed it: In a longer analysis, I take a deep dive into the short- and long-term causes and the short- and long-term consequences of this year’s India-China standoff, which is the most serious in more than 50 years. 

Asia Defense.

The big defense news in the Asia-Pacific in early July pertains to Australia, which has issued two new interesting strategic documents. The first, a “Defense Strategic Update” for 2020, offers insight into how recent developments have changed Australia’s defense requirements. Alongside this update, the Australian Department of Defense released a Force Structure Plan (PDF).

Over at The Diplomat, I commented a bit more in length on the content of these documents and why they represent a significant evolution in Australian strategic thinking about the country’s immediate neighborhood and the future requirements of deterrence in the Asia-Pacific region. Broadly, the update is born of a recognition that Australia’s neighborhood has changed faster than envisaged—particularly as China has grown more assertive.

The prescriptions that flow from this observation in the update are significant for their boldness. Front and center in the update is the notion of investing more in conventional standoff weaponry: specifically, long-range missiles. This development will be a welcome one for many in the strategic community in the United States, where calls for American allies to acquire such capabilities had long persisted — particularly before the end of the 1987 Intermediate-Range Nuclear Forces Treaty last year.

A few other perspectives that are worth reading on the Australian Update and Force Structure Plan include Euan Graham at IISS and Tanya Ogilvie-White’s more critical view over at the Lowy Institute’s Interpreter.

Go Deeper: Listen to the latest episode of the Asia Geopolitics podcast, where I discuss the update and Australian strategic thinking with Ashley Townshend, director of Foreign Policy and Defence at the United States Studies Centre at the University of Sydney.

Esper lists his accomplishments. Sometimes, at a performance review, an employee is asked to reflect on their performance relative to past benchmarks they’d set for themselves. U.S. Secretary of Defense Mark T. Esper seems to have taken that to heart. Earlier this week, the secretary offered an assessment on how well, under his leadership, the Department of Defense had addressed a “list of ten targeted goals” that he originally intended for DoD to complete by the end of this year. The goals are:

  1. Review, update, and approve all China and Russia plans;

  2. Implement the Immediate Response Force, Contingency Response Force, and Dynamic Force Employment enhanced readiness concepts;

  3. Reallocate, reassign, and redeploy forces in accordance with the NDS;

  4. Achieve a higher level of sustainable readiness;

  5. Develop a coordinated plan to strengthen allies and build partners;

  6. Reform and manage the 4th Estate and DOD;

  7. Focus the Department on China;

  8. Modernize the force—invest in game changing technologies;

  9. Establish realistic joint war games, exercises, and training plans; and,

  10. Develop a modern joint warfighting concept, and ultimately, doctrine.

There’s some redundancy built in here and the core theme is really “great power competition,” which is ubiquitous in DoD. That’s hardly surprising. More specifically, it’s notable how much jumps out about the apparent focus on the Asia-Pacific and China in specific, with goal seven being an outright intention to “Focus the Department on China.” 

In his remarks on the goals, Esper noted that this was the overarching goal: “one of our top ten goals – the priority that drives and underlies many of our efforts today – is to focus the Department on China.” 

The maritime militia in a war. James Kraska makes the case that China’s so-called “maritime militia” could now be a legitimate military objective for the United States in a war (in a legal sense). “In the event of naval conflict in the region, the vessels of the Chinese maritime militia could be used to support some PRC military missions. Some of the maritime militia may be coastal fishing craft that are immune from capture during armed conflict but may be attacked if they assist the People’s Liberation Army Navy (PLAN) military effort in any manner,” Kraska writes.

Extras.

The Diplomat is hiring! After nearly seven years, I will be stepping down from my full-time role with The Diplomat (but still continuing this newsletter and the Asia Geopolitics podcast). The good news is that The Diplomat is looking for full-time editorial team members for remote work. As the list notes, “These are challenging and diverse roles that offer the chance to make your voice heard on a range of topical issues relevant to the Asia-Pacific.”

Read more here

The July 2020 issue of The Diplomat is here. This month, we look back at a turbulent year in Kashmir, from the revocation of Article 370 to the current COVID-19 pandemic. 

We also shine a light on New Zealand’s subtle course correction on China, explain the persistence of maritime crime (from piracy to terrorism) in the Sulu Sea, and analyze the prospects for Japan’s post-COVID economy. And, of course, we offer a range of reporting, analysis, and opinion from across the region.

This newsletter is written by Ankit Panda, senior editor for The Diplomat, and director of research at Diplomat Risk Intelligence. Please do feel free to reach out with comments, tips, and feedback at ankit@thediplomat.com and follow me on Twitter at @nktpnd and The Diplomat at @Diplomat_APAC.

The India-China Himalayan Clash

Singapore’s election; Japan’s missile defense moves; former Kyrgyz president sentenced

The Big One.

A clash in the Himalayas.

In the last issue of this newsletter, I offered some thoughts on a June 6 agreement that would have seen India and China “disengage” after weeks-long tensions in the western sector of their disputed border. Things did not go according to plan.

Every few years, the world is reminded of the uncomfortable reality that the world’s first and second most populous countries still have an unresolved border dispute. India and China, nuclear-armed neighbors, sit astride a Himalayan tinderbox, waiting for a spark. One potential spark occurred on June 15, when at least 20 Indian soldiers were killed and scores more injured in a major skirmish with the Chinese People’s Liberation Army in the Galwan River Valley—an area of the remote Himalayan region of Ladakh that has mostly fallen into obscurity since it stood at the center of a major skirmish in the Sino-Indian War of 1962. In addition to the Indian casualties, an unknown number of Chinese soldiers were killed and injured, but China has not published official statistics.

The incident not only propels the ongoing standoff between the two countries, discussed in a recent issue of this newsletter, well past the 2017 Doklam incident, but in fact marks the most serious eruption of violence between the two in 53 years. The June 15 deaths also mark the first fatalities along this disputed border since 1975. The seriousness of what transpired is undeniable. In the days since the standoff, open source evidence and reports sourced among Indian military officials in the area suggest that China is digging in.

I won’t spend much time describing the what of June 15, but the why and what now merit consideration. The good news is that further escalation has not occurred and the first instinct in both New Delhi and Beijing was to use existing diplomatic and military communication channels to address differences. That’s been the long-standing understanding along this border, but at the same time, tensions have shot up in India, where anti-China sentiment is surging. The Indian government, wary about its options, has pushed back officially on Chinese claims along the disputed border, but avoided taking steps that could be deemed escalatory.

Following the June 15 incident, we’ve seen several statements from both sides, helping paint a picture of how each perceives what happened. The People’s Liberation Army Western Command issued a statement (below, helpfully translated by MIT’s M. Taylor Fravel, who recently joined me on the Asia Geopolitics podcast for an overview of the Sino-Indian border):

Meanwhile, the Indian Ministry of External Affairs (MEA) released a few statements, including a readout of a phone call between Wang Yi, the Chinese foreign minister, and S. Jaishankar, his Indian counterpart. Days later, the MEA pushed back on what it said were “attempts by the Chinese side to now advance exaggerated and untenable claims.” This refers to ongoing ambiguous claims by China that the entirety of Galwan Valley—a large area that includes parts that India has administered and patrolled—is under Chinese sovereignty. 

Part of the official Indian reaction has proven troubling for New Delhi. Indian Prime Minister Narendra Modi, in an all-party address on the affair on June 19, said the following words: “No one has intruded and nor is anyone intruding, nor has any post been captured by someone.” The implications of that statement could be parsed in a straightforward way, but it raised serious questions about prior official statements from India, including from the Ministry of External Affairs. (The Indian side released a separate statement on the all-party meeting, including a clarification of sorts on Modi’s terminology that further obscured things.)

Making matters even more bizarre, The Wire noticed that the bit in Modi’s address on no border crossings was so controversial that it was scrubbed from the official video shared on the prime minister’s website. 

Looking ahead, there’s no clear sign of how both sides might find a way out. This is far beyond Doklam in scale and intensity. As some reports suggest, both sides are digging in such that we may not even see the traditional seasonality play an effect (normally, the warmer summer months make these standoffs in this hostile terrain more tolerable). In terms of duration, the useful precedent may be the 1987 Sumdurong Chu standoff between the two sides, which lasted for more than a year.

Sumdurong Chu was notable at the time it happened for both its intensity and its consequences. It resulted in a seminal visit to Beijing by then-Indian Prime Minister Rajiv Gandhi to meet Deng Xiaoping, paving the path to the 1993 agreement between the two countries that codified the principle of the Line of Actual Control. It remains to be seen if the aftermath of this standoff could result in a similar effect. As Gautam Bambawale, a retired Indian diplomat deeply involved in Sino-Indian ties, observed recently, the broader architecture of Sino-Indian diplomatic understandings about the border (as captured in agreements in 1993, 1996, 2005, 2012, and 2013) may come tumbling down. If it does, it’ll need to be replaced with something else. In the meantime, China will likely secure the most advantageous position it can along the disputed border as India seeks to dig in for the long haul.

Diplomat Risk Intelligence.

Diplomat Risk Intelligence offers you dedicated access to an exclusive network of subject matter experts versed in geopolitical, security, economic, and political trends covering the wider Asia-Pacific region. To learn more, click here.

Southeast Asia.

On Tuesday, Singaporean President Halimah Yacob, on the advice of Prime Minister Lee Hsien Loong, dissolved parliament and issued a writ of election, setting the city-state up for what will be a consequential political moment and another of Asia’s big 2020 elections (following the footsteps of earlier elections this year in Taiwan, Mongolia, and South Korea).

The upcoming Singaporean general election will take place on July 10 and will be a public holiday. Lee’s People’s Action Party (PAP), which received 69.9 percent of the vote in 2015, will be looking to seal in another victory, but electoral politics in the country have gotten more complicated in the last five years. If the PAP, founded by perceived “Father of the Nation” Lee Kuan Yew, succeeds in forming a government, it will be its 16th consecutive term since 1959. The stakes will be high, but it’ll be the PAP’s election to lose, with the primary opposition Workers’ Party working against the tide. Additional intrigue, including Lee Hsien Loong’s younger brother officially joining a new opposition party, the Progress Singapore Party, may play a factor. (Lee Hsien Yang has not yet decided if he’ll contest for a seat.)

Add to that the complication of carrying out a general election as Singapore still contends with the effects of COVID-19. Singapore remains in “phase two” of its COVID-19 reopening, which bans any public gatherings larger than five people, making political rallies—long a strong point for opposition parties—impossible in the current climate. This limitation will set up a fierce period of virtual campaigning and congestion in early July. 

There’s nothing like face-to-face negotiations: Jose Tavares, Indonesia’s chief ASEAN diplomat, told reporters that Jakarta feels that negotiations for an ASEAN-China code of conduct for the South China Sea can only take place in a face-to-face format. Video conferencing, all the vogue amid the pandemic, is no substitute. “It will be very hard to negotiate the COC draft virtually, so we’ll wait until the situation improves and we can resume the talks [in person],” Tavares said, according to the Jakarta Post

Last year, ASEAN and China agreed on an initial single draft text of the code of conduct, which was originallycalled for in a 2002 nonbinding declaration of conduct between the 10-nation Southeast Asian grouping and China. The two sides have set a deadline of 2021 for the completion of a code of conduct, but this appeared to be an optimistic deadline—even before a pandemic-induced delay in talks.

East Asia.

Japan’s missile defense turn. Japanese Minister of Defense Taro Kono confirmed, once and for all, that the country’s plans to deploy two Aegis Ashore ballistic missile defense sites had been scrapped amid technical safety concerns. I wrote about some of Tokyo’s options from here at The Diplomat

Tokyo still possesses capabilities like the Patriot Advanced Capability 3 system, but that’ll only cover so much of the threat spectrum. Ballistic missile defense systems like Aegis Ashore, THAAD, and PAC-3 are each designed, tested, and evaluated against certain types of targets; PAC-3 simply can’t do what Aegis Ashore can. For instance, the latter, had it been deployed, would have given Tokyo an exoatmospheric interception capability that for the time being will remain confined to the seven operational Aegis-capable guided missile destroyers in service with the Japanese Maritime Self-Defense Force.

It’s possible that Tokyo may revisit the option to procure THAAD, but cost was one factor in the Aegis Ashore suspension too. Given that the sticker price for the six THAAD batteries was greater than that for two Aegis Ashore sites back in the 2017 evaluations, it’s unlikely that Tokyo will go this way. According to Jiji Press, the Japanese government has convened officials in the Ministry of Defense and National Security Council to game out alternatives. One option could keep Aegis Ashore “afloat” — literally — on a so-called “megafloat,” Jiji Press reports. That’d bring Aegis Ashore back offshore, but not quite in the same way as the system being deployed on board a destroyer.

The geopolitical ramifications are as unclear as what comes next technically. While Russia, for instance, might be pleased to see that Aegis Ashore installations won’t be appearing adjacent to its Far East anytime soon, if the corresponding Japanese policy response is to double down on conventional standoff precision weaponry, then that may have consequences too. Similar concerns will arise in China, where there is particular worry that Tokyo may be more willing to host American ground-launched conventional missiles that could come to Asia in the coming years as a result of the end of the INF Treaty.

Don’t Miss It: On June 24, voters in Mongolia elected 76 new members of parliament. For The Diplomat, Julian Dierkes and Marissa Smith make sense of the significance of the results. “When the Great State Khural constitutes itself it will see many new faces, even though the MPP has managed for the first time to break a pattern of pendulum swings between the two dominant parties, seen over the previous seven elections since 1992.”

An inter-Korean rollercoaster: Tensions between North and South Korea appeared to spike sharply before suddenly settling. The dramatic detonation of the inter-Korean liaison office in the North Korean border town of Kaesong earlier this month marked what initially appeared to be a symbolic termination of the slowly building—but troubled—cooperation between the two sides that had started with diplomacy during the 2018 Winter Olympic Games in PyeongChang, South Korea. Shortly after the explosion, the North Korean side suggested it would take military action against the south and take steps to directly contradict agreements made with the South Korean government in 2018. The instigator for the rising tensions—and the decision to blow up the office—was the launching of anti-regime leaflets by South Korean activists. North Korea takes leaflets seriously.

This week, that all changed. North Korean leader Kim Jong Un himself suspended all “military action plans” against the South. Once again, the step carried some symbolism: it came one day before the June 25 70th anniversary of the start of the Korean War. Making matters more puzzling yet, Pyongyang rolled back prominent propaganda against the South, with several anti-South Korea articles published in recent weeks suddenly and altogether disappearing.

The precise state of play between the two Koreas remains unclear, but the sudden spike in tensions followed by the adjustment signals that Pyongyang wants to calibrate its brinkmanship—with the likely goal of establishing effective leverage to extract economic concessions from South Korea. In any case, watch this space in the coming weeks. 

Central Asia. 

A former president sentenced: Almazbek Atambayev, the former president of Kyrgyzstan, was found guilty by a court in Bishkek of corruption and was sentenced to 11 years and two months. As The Diplomat’s Catherine Putz explains, Atambayev’s charges pertained to the 2013 early release of an ethnic Chechen criminal, Aziz Batukayev. It doesn’t end there for Atambayev: “The former president, who stepped down legally in 2017, faces additional charges in a second trial stemming from the violence that erupted in August 2019 when Kyrgyz authorities moved to detain Atambayev related to the Batukayev inquiry.”

China-Kyrgyzstan-Uzbekistan transport corridor: Land transportation linkages between China and the landlocked Central Asian states continue to develop. As Umida Hashimova reports, “On June 5, 2020, the China-Kyrgyzstan-Uzbekistan transportation corridor was extended farther into China. A cargo train from China’s Lanzhou, in Gansu province, for the first time moved goods to Tashkent.”

Asia Defense.

Three U.S. carriers in the Indo-Pacific. In the month of June, for the first time since 2017, the United States Navy operated three of its Nimitz-class supercarriers for the same time in the Indo-Pacific region. USS Theodore Roosevelt, USS Nimitz, and USS Ronald Reagan all were active in the region.

While the three carriers were in the region together, USS Theodore Roosevelt and USS Nimitz carried out joint dual carrier flight operations in the Philippine Sea starting June 21. “The ships and aircraft assigned to both strike groups began coordinated operations in international waters demonstrating the United States’ unique capability to operate multiple carrier strike groups in close proximity,” a statement from USS Theodore Roosevelt’s public affairs noted

USS Ronald Reagan, currently the permanently forward-based carrier of the U.S. Navy, homeported at Yokosuka in Japan, conducted separate exercises in the Philippine Sea.

The last time the three carriers conducted such operations, tensions were high over North Korea’s missile testing activities in 2017. The ongoing bout of activities comes not long after USS Theodore Roosevelt was taken out of commission after a major COVID-19 outbreak on board. USS Ronald Reagan and USS Nimitz crew were affected by COVID-19 as well.

Chinese aircraft buzzes South Korea. A Chinese Y-9 military aircraft entered South Korea’s air defense identification zone, authorities in Seoul said. South Korea’s Yonhap News Agency reports:

The Chinese plane, presumed to be a Y-9 aircraft, entered the zone Monday morning in the area south of South Korea's southern island of Jeju and south of the easternmost islets of Dokdo before moving into the Japanese air defense identification zone, according to the sources.

Extras.

China’s move to genomic surveillance. Researchers at the Australian Strategy Policy Institute outline efforts by the Chinese government to set up what is the world’s largest law enforcement genomic database. While similar systems elsewhere are designed to track convicted criminals or people of interest, the Chinese system is incorporating the genetic data of “tens of millions of people who have no history of serious criminal activity.”

Earlier Chinese Government DNA collection campaigns focused on Tibet and Xinjiang, but, beginning in late 2017, the Ministry of Public Security expanded the dragnet across China, targeting millions of men and boys with the aim to ‘comprehensively improve public security organs’ ability to solve cases, and manage and control society’. This program of mass DNA data collection violates Chinese domestic law and global human rights norms. And, when combined with other surveillance tools, it will increase the power of the Chinese state and further enable domestic repression in the name of stability maintenance and social control.

Read more.

Debt relief for the Maldives. The president of the Maldives announced this week that China had agreed to a partial suspension of debt payments for a period of four years. Sovereign debt relief is not a new idea given that the G20 resolved earlier this year to suspend all debt payments for 77 developing countries through the end of the year. China implemented that step earlier this month. What’s notable in Solih’s announcement is the considerably longer term—even if partial—suggesting that Beijing is beginning to work out bespoke arrangements. It’s likely not a coincidence that Maldives happens to be a strategic target for Chinese investment in the Indian Ocean (and where a change of government in 2018 brought a more India-friendly government into office). 

Bonus: On China’s loans to the developing world, see Yufan Huang and Deborah Brautigam’s analysis looking at the volume of Chinese assistance.

This newsletter is written by Ankit Panda, senior editor for The Diplomat, and director of research at Diplomat Risk Intelligence. Please do feel free to reach out with comments, tips, and feedback at ankit@thediplomat.com and follow me on Twitter at @nktpnd and The Diplomat at @Diplomat_APAC.

The Beginning of Sino-Indian Deescalation?

Vietnam’s big trade deal; American allies and missiles; ‘Wolf Warrior’ efficiencies

The Big One.

Are India and China really deescalating? Or is something else going on?

Pangong Lake in Ladakh, North India.

This week, the ongoing standoff between India and China may have started to move toward deescalation and a possible wind-down. Following corps commander-level talks over the weekend, the armed forces of the two sides agreed to begin a process of “disengagement” from contested parts of their disputed border along the Line of Actual Control in Ladakh. The details, however, are murky—and what’s clear is that whatever disengagement has happened is partial only. What stands out—especially compared to the resolution of the 2017 Doklam standoff—is that neither side’s foreign ministry has released an official statement on the disengagement unlike in August 2017. Here’s what we have so far from various (Indian) sources.

Indian sources who spoke to the Hindu noted that the following steps had been taken by the two sides: “Partial deinduction has happened from some points in Galwan and Hot Springs areas. [The] Chinese side removed some of the tents and some troops and vehicles have been moved back, and the Indian side too has reciprocated.” “At some points in the Galwan Valley, Chinese troops have moved back 2-3 km,” the Hindu reported. One of the major flashpoints between the two sides, at Pangong Lake, which is bisected by the Line of Actual Control, continues to be unresolved, per the reports. According to Indian news agency ANI, the disengagement also resulted in the movement of Chinese “troops and infantry combat vehicles,” which “moved back by 2.5 km” in the Galwan area. “India has also moved some of its troops back,” ANI reported, citing Indian government sources. (More here.)

However, Ajai Shukla, a well-regarded Indian defense reporter who’s been covering these standoffs since they began in early May, reports that Chinese claims during talks so far have been hard-line, emphasizing a complete claim to the Galwan River sector. More troublingly, Shukla’s sources told him later in the week that both sides had “retreated a bit,” but fundamentally, the standoff remains. 

Similarly, the Indian Express’ Sushant Singh sums up the new picture.

That both sides are talking—using both established military and diplomatic channels—continues to be a positive development. The ongoing standoffs are the most serious at least since Doklam and potentially much longer. Still, it’s worth recalling that the last time a shot was fired along this border was 1967; the India-China border remains tense, but it’s not likely to devolve into a shooting war anytime soon. At the same time, the crisis is serious enough. Credible reports of China moving additional defense materiel, including artillery, near the Line of Actual Control is enough to merit coverage of this crisis at the top of the agenda here and elsewhere.

As we saw with Doklam, the relatively warm summer months can make the hostile, high-altitude terrain of the Himalayas more amenable to a long-running standoff. Given that we’re just in June, in practical terms, both sides can afford to play their hands much longer. This standoff may be here for a while.

In Case You Missed It: For additional background on the India-China border disputes, including the nature of the Line of Actual Control and the history of the disputed border, listen to my recent discussion with MIT’s M. Taylor Fravel on the Asia Geopolitics podcast. If you’re an iOS or Mac user, you can also subscribe to The Diplomat’s Asia Geopolitics podcast on iTunes here; if you use Windows or Android, you can subscribe on Google Play here, or on Spotify here.

Diplomat Risk Intelligence.

Diplomat Risk Intelligence offers you dedicated access to an exclusive network of subject matter experts versed in geopolitical, security, economic, and political trends covering the wider Asia-Pacific region. To learn more, click here.

Southeast Asia.

Vietnam is on pace to be one of Asia’s fastest-growing economies this year. After responding highly effectively to COVID-19, the country just ratified a major free trade agreement with the European Union this week—one that will see 99 percent of tariffs on traded goods between it and the EU eliminated. The ratification of the agreement—officially known as the European Union Vietnam Free Trade Agreement (EVFTA)—speaks to Hanoi’s all-in strategy on trade liberalization; Vietnam is also a member of the 11-country Trans-Pacific Partnership. For the EU, the FTA with Vietnam is the second with a Southeast Asian state—the other being its FTA with Singapore.

According to the World Bank’s analysis, the EVFTA would have a significant effect on Vietnam’s overall GDP, boosting it by 2.4 percent over the scenario where it hadn’t entered the agreement. It could also raise Vietnamese exports by 12 percent by 2030, per the World Bank. “Such benefits are particularly urgent to lock in positive economic gains as the country responds to the COVID-19 pandemic,” the World Bank added.

The EVFTA also emphasizes just one more way in which the United States is missing out on the appetite for trade liberalization in Asia today. Even as the Trump administration has threatened Hanoi with tariffs (Trump last year said in an interview: “Vietnam is almost the single worst — that’s much smaller than China, much — but it’s almost the single worst abuser of everybody”), Vietnam has forged ahead with this new agreement. For Hanoi, the United States’ decision to unilaterally withdraw from the TPP back in January 2017 was a major blow to that agreement—which Vietnam had been poised to benefit disproportionately from—but regardless, Vietnam has pushed forward in the years since.

East Asia.

A problematic COVID-19 origins study? Nearly six months since the Chinese city of Wuhan first went into lockdown, theories continue to abound about the origins of the COVID-19. In early June, a study published by Harvard Medical School researchers began to go viral, gaining widespread attention for its claims that the virus could have emerged in Hubei province much earlier in 2019 than believed. The study (full PDF link here) even made it onto Fox News here in the United States, where it was subsequently picked up and tweeted out by none other than the president of the United States.

There’s just one problem: the study is not peer reviewed, and contains significant methodological oversights.

Of course, Trump’s Twitter loudspeaker further raised the prominence of the study, highlighting the continued dangers in having non-peer reviewed work on these controversial topics winning widespread coverage without sufficient oversight and review. Given the administration’s previous attempts to defy the U.S. intelligence community and blame the Chinese government by any means for the pandemic’s global effects, this episode stands out. For now, the administration hasn’t pursued this further, but watch this space.

Does ‘Wolf Warrior’ diplomacy work? According to a new paper from two Yale University political scientists based on a survey (PDF), China’s acerbic new brand of so-called “Wolf Warrior” diplomacy is not yielding positive results for Beijing—at least as far as actual persuasion is concerned. The researchers find that “Aggressive messages that attempt to tear down the United States do not have broad appeal,” and that “messages that highlight foreign aid move public opinion in China’s favor.” The paper doesn’t offer explanations for why Chinese diplomats have adopted this new approach, but perhaps the “Wolf Warrior” turn has more to do with intra-bureaucratic performance (i.e., impressing superiors back in Beijing) than actually persuading one’s interlocutors.

Japan for Hong Kong. Tokyo’s relative silence over the Chinese National People’s Congress draft decision on a new national security law raised some eyebrows initially. Japan’s Kyodo News Agency had reported that Tokyo had “opted out” of signing onto the rare multilateral joint statement put out by the United States, the United Kingdom, Canada, and Australia on the NPC’s decision. 

That, however, appeared to be premature. This week, Japanese Prime Minister Shinzo Abe himself said that Tokyo will take the lead in drafting the Group of Seven (G7) statement on China’s plans for Hong Kong. “Japan wants to take the lead among the G7 countries in issuing a [joint] statement based on the premise of the ‘one country, two systems’ principle,” Abe said before Japan’s National Diet. The move is a far cry from the fence-sitting some had alleged.

It remains to be seen how and if Tokyo’s more prominent role in the pushback against the upcoming national security law—which is yet to be drafted—will feed back significantly in the Japan-China relations. Broadly, relations between Beijing and Tokyo have been on and upswing over the past year. We may expect to soon see increased tensions, perhaps in the East China Sea.

South Asia.

Sri Lanka sets parliamentary election date. Sri Lanka has set August 5 as the date for its upcoming parliamentary elections, which have already been postponed twice over amid COVID-19. The Election Commission has confirmed the date and the election will be the first major democratic test for the government led by President Gotabaya Rajapaksa, who dissolved parliament on March 2. Gotabaya Rajapaksa was sworn in last November after a campaign based around national security and Sinhala nationalism. His brother, Mahinda Rajapaksa, the former president, serves as prime minister.

Asia Defense.

Will American allies host missiles? Over at the Los Angeles Times, David S. Cloud reports on perspectives in the Asia-Pacific among U.S.-allied states about the prospect of hosting American ground-launched missiles that might come into existence now that the 1987 Intermediate-Range Nuclear Forces Treaty is no more. American allies, however, have a set of sticky political obstacles before they can sign up to host American missiles. 

Gov. Denny Tamaki of Japan’s Okinawa prefecture told Cloud that he is “firmly” opposed to the idea. That matches up with what I learned during a late-2019 trip to Tokyo where I spoke to several Japanese officials about these questions; Tokyo is well attuned to the political difficulties of such a deployment.

NATO to stand up to China? Asia-watchers in the United States and Europe have long bemoaned that the transatlantic alliance has not taken China quite as seriously as it should have. Could that be about to change? NATO chief Jens Stoltenberg had uncharacteristically harsh words for Beijing, when he called out China’s “bullying and coercion” as a priority for the alliance. 

“The rise of China is fundamentally shifting the global balance of power, heating up the race for economic and technological ­supremacy, multiplying the threats to open societies and individual freedoms and increasing the competition over our values and our way of life,” Stoltenberg added. “They’re coming closer in cyberspace, we see them in the Arctic, in Africa, we see them ­investing in our critical infrastructure. And they’re working more and more with Russia. All of this has security consequences for NATO allies.’’

For an alliance built from the ground up to deter first Soviet and now Russian aggression, the shift is difficult—especially given that Russia hasn’t gone anywhere as China has risen. Stoltenberg’s statements, however, can be seen as more evidence for the hypothesis that NATO may soon learn to walk and chew gum in terms of dealing with both adversaries.

Undersea cables in the South China Sea. According to Radio Free Asia and Benar News, high resolution satellite imagery of the Paracel Islands recently has shown a Chinese ship involved in laying undersea cables between China-held features in the island group, which is also claimed by Vietnam and Taiwan. “The cable ship began operations in the area nearly two weeks ago after departing from a shipyard in Shanghai,” RFA notes. It’s unclear if the cables are intended to increase connectivity between these features or if they’re playing an overtly militarized role in undersea surveillance of submarines. South China Sea littoral states have quickly expanded their submarine forces in recent years, making anti-submarine warfare a major priority for China and other states in the region.

No Afghan withdrawal anytime soon. Gen. Frank McKenzie of U.S. Central Command went on record this week to clarify that the Taliban had not yet met the conditions required per the U.S.-Taliban February 2020 deal for any U.S. troop withdrawal. Per the agreement, an initial set of conditions would have to be met for a reduction in troop levels. “Those conditions would be: Can we be assured that attacks against us will not be generated there? And as of right now ... frankly, if asked my opinion, those conditions have not been fully met,” McKenzie said.

Extras.

A retired American general reflects on racism in the United States. Lt. Gen. Vincent Stewart (Ret.), a former director of the U.S. Defense Intelligence Agency, has a powerful essay over at Task and Purpose, reflecting on racism in the United States:

By all accounts, I have truly lived the American dream. I am a first generation American who rose to the top of my profession — a living embodiment of the ideal that if you work hard enough, you can achieve anything. Yet hard work is not enough for many of my fellow black Americans, who run into institutional barriers, and all too often face deep-seated fear, contempt, resentment, and hatred.

I am now part of the “privileged” class, a black man who overcame obstacles to become a three-star general, told by white people that at least things are better than they were, while black people think I can’t possibly understand their anger, frustration, or despair. Neither are right.

Read more at Task and Purpose.

‘Black Lives Matters’ goes global—and the Asia-Pacific follows. Across the region, protests in solidarity with the American Black Lives Matter movement have taken place. As Thisanka Sripala reports for The Diplomat, demonstrators have gathered in Tokyo, and in South Korea, the issue has become a rare, unifying bipartisan matter, bringing the country’s conservatives and progressives together, as Kyle Ferrier writes. Not all protests have been without incident, however, in Asia. 

In Sri Lanka, local police cracked down on a solidarity protest; Kalani Kumarasinghe reports on the brutality with which Sri Lankan authorities put an end to a small protest outside the U.S. Embassy in Colombo. Finally, the anti-racism protests in the United States should cause Australia to reflect on its own structural racism as pertaining to indigenous peoples, Pascale Hunt argues in The Diplomat.

What to know about the 75th anniversary of the Hiroshima and Nagasaki bombings. Nuclear weapons historian Alex Wellerstein has put out an immensely helpful blogpost summarizing the historiography around the controversial August 1945 atomic bombings of the Japanese cities of Hiroshima and Nagasaki. Written for journalists, the post is a helpful summarization of the myths that continue to pervade common understandings of the bombings (and the American decision to move ahead with them).

COVID-19 at The Diplomat:We’re happy to note that ongoing coverage and analysis at The Diplomat of the COVID-19 pandemic in the Asia-Pacific is paywall-free for all readers. Access the latest in our coverage here. COVID-19 coverage at The Diplomat is presented by Diplomat Risk Intelligence. Learn more about DRI here

This newsletter is written by Ankit Panda, senior editor for The Diplomat, and director of research at Diplomat Risk Intelligence. Please do feel free to reach out with comments, tips, and feedback at ankit@thediplomat.com and follow me on Twitter at @nktpnd and The Diplomat at @Diplomat_APAC.

The End of Hong Kong As We Know It

North Korea illicit finance crackdown; Taiwan arms sales

The Big One.

China’s National People’s Congress takes on Hong Kong.

China parliament advances Hong Kong security law

Breaking: As this edition of the newsletter went to print, U.S. President Donald J. Trump at a Friday press conference announced new measures pertaining to China. This included plans to revoke Hong Kong’s special customs and travel status; sanction certain Chinese and Hong Kong officials; and suspend travel rights to the United States for certain Chinese individuals (including some students). The press conference also included an announcement that the United States would withdraw from the World Health Organization. Details remain unclear.

On Thursday, China’s National People’s Congress voted 2,878-to-1 in favor of a decision that authorizes a process to draft a national security law that will directly be imposed on the semiautonomous Hong Kong region. The vote itself (specifically on “Decision on Establishing and Improving the Legal System and Enforcement Mechanisms for the Hong Kong Special Administrative Region to Safeguard National Security”) does not result in a law right away, but starts the process, which will likely conclude by late August. When all is said and done, Beijing will have established the means to directly crack down on activities it considers undesirable in the city, including what it interprets as terrorism, separatism, or secessionism. 

The NPC’s vote has confirmed the worst fears among Hong Kong’s democrats, who see this as the final nail in the coffin for “one country, two system.” Chinese Premier Li Keqiang defended the law by saying that it would amount to the “steady implementation of the ‘one country, two systems.’” Li’s wording echoed a pledge made by Xi Jinping himself during a 2017 visit to Hong Kong—long before last year’s unrest over an extradition bill spiraled into a broader movement about the city’s destiny itself.

Aside from the ramifications on political and civic life in Hong Kong—which will be severe—the NPC’s move raises serious questions about the future viability of Hong Kong’s exceptional status as a global city and financial hub. The Hang Seng Index (HSI) reacted negatively, as was to be expected, but what’s still notable is the relatively modest downward move. Investors and businesses with substantial Hong Kong exposure have gotten used to a certain degree of volatility amid last year’s substantial protests against the extradition bill, but the latest moves—on top of the pandemic crunch that hit earlier in the spring—suggest that this dramatic turn of events may not have been entirely unexpected.

Much will depend on how major international players, including the United States, react. On Wednesday, a day before the NPC vote, Mike Pompeo, the U.S. secretary of state released a statement noting that he had officially certified “that Hong Kong does not continue to warrant treatment under United States laws in the same manner as U.S. laws were applied to Hong Kong before July 1997.”

The Diplomat’s Shannon Tiezzi takes a closer look at what may come ahead: 

The implication is that Hong Kong’s separate agreements and arrangements with the United States could be revoked, meaning Hong Kong, from the U.S. perspective, would be treated no differently from any other Chinese city. For example, Hong Kong would no longer be exempt – as it currently is – from the Trump administration’s tariffs on Chinese goods.

It’s even possible that the United States could withdraw its support for Hong Kong holding a separate seat from the PRC in international organizations like the World Trade Organization and Asia-Pacific Economic Cooperation (APEC) forum.

Hong Kong has been a flashpoint in U.S.-China ties for some time now and that’s not about to change, either.

The clash spilled over into the United Nations, where China shot down a U.S. bid to have Hong Kong brought up at the Security Council, calling it a “a matter of urgent global concern ​that implicates international peace and security.”

Shortly after the passage of the draft decision by the NPC, the governments of the United States, Australia, Canada, and the United Kingdom released a joint statement saying that:

Hong Kong has flourished as a bastion of freedom. The international community has a significant and long-standing stake in Hong Kong’s prosperity and stability. Direct imposition of national security legislation on Hong Kong by the Beijing authorities, rather than through Hong Kong’s own institutions as provided for under Article 23 of the Basic Law, would curtail the Hong Kong people’s liberties, and in doing so, dramatically erode Hong Kong’s autonomy and the system that made it so prosperous.

The relatively quick turnaround on the release of this joint statement speaks to the high degree of concordance and coordination among the four anglophone nations on the matter. The content of the statement largely puts these countries on board with the U.S. assessment that Hong Kong no longer has sufficient autonomy. What that will mean for each of these countries’ relationships with the city remains to be seen. The joint statement does propose a solution, however: “Rebuilding trust across Hong Kong society by allowing the people of Hong Kong to enjoy the rights and freedoms they were promised can be the only way back from the tensions and unrest that the territory has seen over the last year.”

Alongside the four anglophone states, the European Union’s high representative for foreign affairs and security policy, Josep Borrell Fontelles, said in a statement that the EU was following developments in Hong Kong closely. His statement came after the vote on the draft decision came to be part of the agenda of the NPC. “The European Union has a strong stake in the continued stability and prosperity of Hong Kong under the ‘One Country Two Systems’ principle,” Borrell said. “It attaches great importance to the preservation of Hong Kong’s high degree of autonomy, in line with the Basic Law and with international commitments,” he continued. Japan, meanwhile, noted it was “seriously concerned” by the NPC’s decision—a somewhat rare statement from Tokyo at a time when relations between it and Beijing have been broadly improving.

Despite the considerable international backlash and pressure, it appears that Xi and the Chinese leadership are determined to press on, calculating that allowing Hong Kong to persist as a bastion of free expression and criticism of Beijing is detrimental over the long run. In short, the calculation here seems to be that, for China’s national interests, bringing Hong Kong under the iron-fisted control of Beijing is worthwhile, even if it bears costs.

For a deeper dive, have a listen to the latest episode of the Asia Geopolitics podcast. Shannon Tiezzi joins me to discuss the NPC’s decision and what the future might hold for Hong Kong.

Diplomat Risk Intelligence.

Diplomat Risk Intelligence offers you dedicated access to an exclusive network of subject matter experts versed in geopolitical, security, economic, and political trends covering the wider Asia-Pacific region. To learn more, click here.

East Asia.

On Thursday, the United States Department of Justice (DOJ) unveiled one of its most significant actions against North Korean illicit finance activities in years. The DOJ charged 28 North Korea and 5 Chinese individuals with a range of charges, including money laundering for more than $2.5 billion in illicit payments that DOJ said went toward the country’s weapons of mass destruction. The full 50-page indictment is available here and notes, among other details, that a sum of $63,511,387.85 in North Korean assets was frozen by U.S. officials between October 2015 and January 2020.

The indictment is worth a full read for anyone with an interest in the North Korean regime’s illicit finance activities. It details how the individuals charged set up a network encompassing more than 250 front companies to facilitate payments through the U.S. financial system to North Korean coffers.

The North Korean side had yet to react to the action as of this writing, but it’s difficult to imagine Pyongyang taking this lightly. The move hearkens back to 2005, when the United States busted Kim Jong Il’s Macau-based slush fund at Banco Delta Asia. At the time, that became a major sticking point in negotiations, with the North Koreans refusing to advance the agenda for talks until the Banco Delta Asia issue could be addressed. It’s not clear that we’ll see a similar effect this time given that there are no working-level U.S.-North Korea contacts at the moment. Instead, the action does showcase the considerably complexities involved in completely choking off North Korea’s access to overseas financing.

What remains to be seen, too, is how U.S. ally South Korea will view the development. Seoul’s progressive government has been eager to move ahead with cooperation with Pyongyang; it’s not clear if South Korea was given a heads up on this development.

Asia Defense.

A few defense stories you might have missed:

Heavy Weight Torpedoes for Taiwan? The U.S. State Department has approved a possible Foreign Military Sale of 18 MK-48 Mod 6 Advanced Technology Heavy Weight Torpedoes for Taiwan in a deal estimated to cost $180 million. The announcement did not mark the finalization of a sale, but the approval of a potential sale. If finalized, the sale would mark the first U.S. arms sale to Taiwan in 2020. Announcement of the possible sale’s approval came a day following Taiwanese President Tsai Ing-wen’s inauguration for a second term in office. At her inauguration, Tsai rejected mainland China’s “one country, two systems” formulation, saying that Taiwan would “not accept the Beijing authorities’ use of ‘one country, two systems’ to downgrade Taiwan and undermine the cross-strait status quo.” It’s not yet clear which Republic of China Navy (ROCN) submarines will be potentially receiving these torpedoes for operation. The ROCN operatesChien Lung-class and older Hai Shih-class submarines that could potentially operate these torpedoes.

To watch: Speaking of Taiwan, Taipei is planning on requesting American Harpoon anti-ship missiles as well—perhaps taking advantage of the Trump administration’s willingness to approve ongoing requests. 

The DF-26’s warhead ambiguity feature. I commented briefly recently on some interesting open source work published by a few analysts recently highlighting the dual-use nature of China’s DF-26 intermediate-range ballistic missile:

This intermediate-range ballistic missile appears to have been built from the ground-up with conventional and nuclear strike options in mind, introducing dangerous ambiguities that might make inadvertent escalation in a crisis more likely.

This same danger, however, may be part of what grants Chinese leaders the confidence that the system is a good idea in the first place. There’s some evidence American policymakers have started considering what the DF-26’s co-mingled nuclear-conventional units might mean for escalation — at least if a recent Department of Defense report on Chinese military power is a reliable indicator.

The end of an era. The Chinese People’s Liberation Army Navy (PLAN) is set to retire the last of the Type 051 class guided-missile destroyers in the coming weeks, the Chinese Ministry of Defense announced. The last vessel, an improved Type 051G variant known as Zhuhai, will be decommissioned soon. “At present, the designated receiving unit is arranging for its handover and applying for a provincial themed patriotism education base for it,” a PLA Daily article noted.

India’s carrier plans dashed? Raji Rajagopalan digs into recent comments by India’s first chief of defense staff, General Bipin Rawat, on the utility—or rather inutility—of the aircraft carrier for the Indian Navy. Rawat, an Army man, pooh-poohed the Indian Navy’s aspirations for a third carrier, pointing to other needs. As Rajagopalan writes:

Rawat’s statements have several implications. Most importantly, it calls into question the Indian Navy’s and the Air Force’s acquisition plans. These are particularly important at a time when China has been both putting pressure on the Sino-Indian border and venturing into the Indian Ocean Region. Rawat’s comments could also bring back concern within the Navy and the Air Force about the Army’s dominance within the Indian military and potentially lead to intensified interservice rivalry among the three services. The creation of the chief of defense staff (CDS) post was meant at least partly to create greater synergy among the services and greater jointness, but that could be at risk if the two smaller services feel the CDS is being partial to the Army. 

India, like many other states, will be feeling the effects of a pandemic-induced fiscal crunch on military spending soon. Rawat’s prescriptions might not find universal adherents, but it’s clearer than ever that Delhi will need to make tough choices

Deterrence in the Pacific. U.S. Senators Jim Inhofe and Jack Reed write over at War on the Rocks about their plans to make sure the next U.S. National Defense Authorization Act has a Pacific analog to the European Deterrence Initiative: a Pacific Deterrence Initiative.

With the stakes so high, the time for action is now. That’s why this year we intend to establish a Pacific Deterrence Initiative in the National Defense Authorization Act for Fiscal Year 2021. The Pacific Deterrence Initiative will enhance budgetary transparency and oversight, and focus resources on key military capabilities to deter China. The initiative will also reassure U.S. allies and partners, and send a strong signal to the Chinese Communist Party that the American people are committed to defending U.S. interests in the Indo-Pacific.

Extras.

Ulysses S. Grant and Japan. Over on Twitter, historian David Fedman has a great thread showcasing a Meiji-era illustrated treatment of former U.S. President Ulysses S. Grant. 

For the full thread, click here. And if that piece of history interests you, you can also check out Robert Farley’s overview of Grant’s post-presidential Asia tour, which helped solidify the United States’ Asia presence in the late 19th century.

Twitter fact-checks China’s “wolf warriors”. Twitter’s decision to begin fact-checking statements by prominent government officials, including U.S. President Donald Trump, has attracted its fair share of controversy. Amid the new change, however, statements by official Chinese diplomatic spokespeople have been getting the same treatment. For instance, Zhao Lijian, the Chinese Ministry of Foreign Affairs’ spokesperson, had a fact-check alert added onto his March 13 tweet implying that COVID-19 “originated in the US.”

Clicking the alert sends the user to the World Health Organization’s resource page on the pandemic.

COVID-19 at The Diplomat:We’re happy to note that ongoing coverage and analysis at The Diplomat of the COVID-19 pandemic in the Asia-Pacific is paywall-free for all readers. Access the latest in our coverage here. COVID-19 coverage at The Diplomat is presented by Diplomat Risk Intelligence. Learn more about DRI here

This newsletter is written by Ankit Panda, senior editor for The Diplomat, and director of research at Diplomat Risk Intelligence. Please do feel free to reach out with comments, tips, and feedback at ankit@thediplomat.com and follow me on Twitter at @nktpnd and The Diplomat at @Diplomat_APAC.

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