Notes on IMEC, the Indo-Pacific, China’s presence

Audizione su rapporti Italia-Paesi Indo-pacifico, Comitato permanente sulla politica estera per l’indo-pacifico, istituito presso la Commissione Affari esteri. 22nd November 2023. (Link: Audition)

The view of the Indo-pacific has normally been from the other side of the Pacific Ocean where the more used economic term was Asia Pacific. The first leader to recognize the importance of India, was former Japanese Prime Minister Shinzo Abe in his speech to the Indian parliament called the “Confluence of the Two Seas”. While this was an inspiration to the first Quad, it came from Abe’s experience at countering China in the Pacific and his realization that India needed to be at the centre of any struggle to counter China. The first Quad was to fail within one year of its birth.

Launched in 2023, India-Middle East-Europe Economic corridor (IMEC) moves India to the center of the Indo-Pacifico almost 16 years after Abe’s famous speech. It has taken India 16 years to develop its own political strategy and take its position as a global power while concluding various defense agreements, principally with the United States. While different countries in the region have different strategies to deal with the growing contest between China and the United States, the basic concept is to protect a Free and open indo pacific  (FoIP) from China’s aggressive policies.

By moving the center of the Indo-Pacific macro region to India by the announcement of IMEC, the large unit that is the Indo-Pacific, which goes from the shores of africa right up to the pacific shores of the united states is automatically divided into two parts, the Indo-Mediterranean and the smaller Indo-Pacific.

The Indo-Mediterranean marries the enlarged Mediterranean to the Indian Ocean of the Indian West coast. Its influence extends from Italy right up to the west coast of India, including the Middle East (now called West Asia), Israel, the persian gulf and GCC, horn of Africa, right through the red sea, bab al mandab into the the Indias west coast.

The smaller Indo-Pacific starts from the Eastern shore of India, the Bay of Bengal, Sri lanka and extends to the pacific shores of the United States, bringing into it Japan, ASEAN, Australia etc.

This division creates a far more important role for Europe, Italy, Israel and the countries of Middle East, GCC and makes them stronger stakeholders in the larger Indo-Pacific project. As foreign policy, the Indo-Mediterranean brings Italy’s Mattei plan in complete synergy with India’s Indian Ocean Rim Association (IORA) and Security and Growth for All in the Region (SAGAR) which become complements of each other.

This is strategically also important as the Indo-Mediterranean has traditionally been the projection of influence of European countries. This is also the area which is most important for energy production world wide, the GCC countries which account  for around 45% of the worlds oil reserves and around 20% of the worlds gas reserves. The Indian Ocean is also China’s weak point, where China receives more than half its oil and gas from. It is China’s access to its biggest markets but where China struggles to create a contiguous military presence. Strategically, to check China’s growing influence in the Pacific, Abe had envisioned, it was important to start in the Indian Ocean.

IMEC’s announcement at the G20 in Delhi also brought together over 500 years of history. In 1453 the fall of Constantinople to the Ottomans, cut the land route from India to Europe, started a struggle in Europe for access to India via sea and destroyed Venices (Italy) primacy for trade with the orient, first to Portugal and later to the UK.

Until IMEC’s announcement Europe and India (and Asia) were mainly connected by sea, initially around the Cape of Good hope and now through the Suez canal.

This was all to say that the IMEC is a simple concept, not a grand political announcement. Unlike the Chinese Belt and Road Initiative(BRI), the IMEC works at making trade more efficient by connecting corridors which exist, which have to be reinforced and not created. In this aspect it is more a competitor to the International North South Trade Corridor (INSTC) which was started by Russia, Iran and India and recently started operations.

The India-Uae and India-Saudi Arabia sea links are already defined. The IMEC suggests the following ports on the various end:

  • IndiaMundhra, Kandla, JNPT Mumbai.
  • UAE-Fujairah, Jebel Ali (Dubai), and Mina Zayed Abu Dhabi.
  • Saudi Arabia: Dammam and Ras al khair.
  • Israel: Haifa

Mundra and Haifa are owned by the Indian group Adani and hence in Indian control.

The highways from Fujairah to Haifa already work and are in place, I have personally tried them and sent cargo on them years ago. Rail links are also in place according to announcement from the respective railway companies. Etihad Rail has declared the entire 900 km route from Fujairah port to the Saudi Arabia-UAE border checkpoint at Al Ghweifat, as operational for cargo in March 2023.

Saudi Arabia is constructing the connection between Al Batha at the Al Ghweifat checkpoint to Haradh (180 kms) where it connects to the Eastern cargo line from Dammam to Riyadh. This extends then from Riyadh to the Jordan border at al hadith which is already functional.  

Israel already has the Haifa-Beit Shaan line which comes to 15 kms of the Israel Jordan border at Shiekh Hussien bridge. The project for constructing the Beit Sha’an-Shiekh Hussien bridge 15 kms will cost 2 billion NIS and the project is ready. The project includes avoiding passing the city of Haifa for cargo to be directly delivered to the port. Adani, Haifa ports new owner, has promised infrastructure to make Haifa a jewel of the Mediterranean. This essentially requires the construction of the Jordan part of the railway, around 200-250 kms which connects the Saudi border of Al Haditah with the Jordan Israel border at Shiekh Hussien bridge.

Even before the Abraham accords, containers moved from Dubai to Israel through Jordan by road. So as you see the only impediment to IMEC being quickly implemented is a Saudi-Israeli political agreement which was delayed to the Hamas terrorist attacks on the 7th of October. While an agreement is sought and conflict continues, it is in Saudi, Indian and European interest that the railway is built in Jordan. The proposed path passes through the poor part of the country and would give rise to economic development and jobs. Italy could play an important role here as a trade proxy between the Saudis and the Israelis until a mutual recognition deal is achieved, if needed.

For Italy all this is very important as where the traffic goes from Haifa, is still to be decided. France would like to be a sea terminal necessitating development in Greece and the Italian west coast, when Italy could easily divert its traffic to its east coast, allowing development of Sicily, Puglia and Adriatic ports which then transport goods via train to France and Germany. This would create jobs, infrastructure and sustainable development.

With with the Partnership for Global Infrastructure and Investment (PGII) and a saudi commitment of $20 billion, the IMEC is a reality. For Italy to benefit fully from this, it needs to be the leader in keeping IMEC allow, not allowing France and Germany to hijack its efforts.

Who does the IMEC upset?

The IMEC announcement has upset not just China. Russia has developed the International North–South Transport Corridor (INSTC) to connect India, Iran, Russia, Azerbaijan, and other countries via railways and sea which had just started seeing results. IMEC challenges the North South Transport Corridor and apart from the BRI so challenges Russia and Iran as well. It also avoids Turkey and gives the Saudi’s primacy in trade with Iraq and the Middle East. The announcement at the G20 saw a surprised Erdogan livid at being excluded. The IMEC is an alternative to the Suez Canal, this also creates some unhappiness in Cairo for whom the Suez is an important source of revenue, political control and trade monopoly.

Strategic Reasons of moving India to the center of the Indo-Pacific

Apart from commercial interests, the strategic interest of moving India to the center of the Indo-pacific is also to counter China’s aggression. The Indian Ocean is mainly Indian. China continues its attempts to establish its bases in and around India (string of pearls) to safeguard its interests. Recent intelligence reports state that China is trying to establish a military base in Oman. There was a Chinese military base under development in Abu Dhabi. It has a port in Gwadar, Pakistan.The only successful Chinese base is in Djibouti. As a part of the BRI China has an agreement to develop Jazan port in Saudi Arabia, which would allow it to check traffic in the Bab al Mandab.  India’s focus on Omani ports of Sohar and Duqm, have led to China trying to setup a military base in Oman.

Andaman and Nicobar: A potential thorn for China

However, coming back to Abe’s confluence of the two seas, it is India that controls the choke point to China’s naval ambitions. The Indian islands of Adaman and Nicobar are the meeting point of the Indian Ocean, Andaman sea with the Pacific and controls access to the Pacific. The ten degree channel which controls the access to the Malacca strait runs through India’s exclusive economic zone. India is investing reportedly over $5billion in upgrading its military and naval presence. It is also building a transshipment port in Greater Nicobar. Currently ships wait at the China run port in Colombo for their turn to enter the strait of Malacca, in the future even chinese ships will have to wait at the Indian controlled transshipment point at Galathea Bay. India’s Adani group financed by the US federal Development Finance Corporation is also building a western terminal at Colombo port, which threatens China’s control to the path leading to the 10 degree channel.

India’s advantage to the Quad

India can now also open its ports as under defence agreements with allies (the Quad), specially the United States, Japan and Australia with whom India has separate defense agreements. These ports include the military and commercial ports at Andaman and Nicobar, strongly limiting China’s ability to enter and exit the Indian ocean. To protect its commercial investments, India is justified in stepping up patrols and installing security devices such as sonar detectors etc. making Chinese submarines vulnerable to detection and allowing India to conduct arial surveillance in the Pacific with US technology.

Over 50% of China’s oil reserves passes through Malacca. India’s control of this part of the sea creates a huge bottleneck for any ideas of Chinese open aggression in the South China sea. Technically shipment to China could be blocked by Quad entities at Malacca and Sunda straits. This nervousness leads China to constantly expand its Indian Ocean presence. Finally, the IMEC and the Andaman and Nicobar Islands make India a gateway to the ASEAN countries for commercial interests. Countries like Italy can set up friend shoring manufacturing for the Indian and ASEAN markets in India, avail of free trade and supply chain agreements signed by India in the Pacific (such as IPEC), as well as shorten the supply chain. This would give Italy a great advantage commercially. Germany and a few countries are already experimenting with SME clusters in India, Italy should take advantage of the strategic partnership  with India to do so.

Where there are commercial interests, it is important to defend them. India is the only country which shares a land border with China and can assist the world in countering China in the seas and hence now is the centre of the new Indo-Pacific. Italy must seize the opportunity that IMEC offers and continue its path without waiting for the resolution of the middle east conflict. Italy must lead EU strategy into the IMEC and the Indo-Mediterranean as a natural continuation of the Mattei plan. Only then the Indo-Mediterranean will be the result of a true Indo-Italian partnership.