VINACHEM

The Central Asian Republics (CARs) have, in recent years, implemented multifaceted foreign policies to achieve strategic autonomy and limit China’s influence and Russia's traditional sway. But domestic uprisings in the CARs, the Taliban's resurgence in Afghanistan, and now the Russia-Ukraine conflict have given China new opportunities to strengthen its presence in Central Asia. This brief investigates China's increased engagement with the CARs amid the Russia-Ukraine war, and the implications for other global and regional powers.

Since 2021, the Central Asian Republics (CARs) have experienced the impacts of worsening internal and external fault lines. While the Taliban’s return to power in Afghanistan has increased security and stability concerns, the Russia-Ukraine war has heightened sovereignty risks in the region. At the same time, border clashes between Tajikistan and the Kyrgyz Republic in 2022 left hundreds dead and thousands displaced, while unrest in Kazakhstan against the halt in state subsidies on liquified petroleum gas and protests in Uzbekistan over the proposal to downgrade the autonomous status of Karakalpakstan added to stability woes across Central Asia.

The CARs have long seen Russia as a security guarantor for internal stability and against external threats. For instance, when the Taliban returned to power in Afghanistan, Russia positioned military equipment on the Tajik-Afghan border under the Collective Security Treaty Organization (CSTO)^[a] and held joint military exercises with Uzbekistan and Tajikistan a mere 20 km from the Afghan border. This display aimed to demonstrate Russia’s military readiness in its backyard in the event of any aggression from the Taliban or other terrorist organisations towards Central Asia. Similarly, in January 2022, Moscow sent its forces under the CSTO to quell the protests in Kazakhstan.[4] However, Russian aggression in Ukraine has forced the CARs to reduce their traditional security dependence on Moscow. Russia is increasingly seen as a threat to regional stability, territorial integrity, and sovereignty, especially in Kazakhstan.

In February 2022, Russia began a special military operation against Ukraine, a former republic of the Soviet Union, just like the CARs. Moscow’s redeployment of troops to Ukraine from the Tajik military base led to concerns about terrorism spreading along the over 2,000 km porous border between Afghanistan and Tajikistan, Uzbekistan, and Turkmenistan.[7] Additionally, western sanctions on Russia forced the CARs to look for alternative routes to export goods to the international market. Notably, during the call for the partial mobilisation of 300,000 troops amid the Ukraine war, Russia also sent migrant workers from the CARs to the frontlines of the war zone, bringing back memories of the Second World War.[8] The migrant workers were sent to Russian-occupied Ukrainian territories to collect the bodies of dead soldiers and dig trenches. Moscow even threatened to revoke the Russian passports granted to any Central Asian citizen if they tried to evade mobilisation.

Russia’s actions in Ukraine, domestic unrest in the CARs, and increased concerns about sovereignty have forced the Central Asian countries to seek new partners for longstanding security partnerships. Notably, China is leveraging the anxiety vis-a-vis Russia to help the CARs enhance their law enforcement and security capabilities. Under these peculiar conditions, Chinese President Xi Jinping echoed support for Kazakhstan’s territorial integrity during his visit to Central Asia in September 2022. In May 2023, Xi hosted the China-Central Asia Summit in Xi’an, and reiterated that the security, sovereignty, independence, and territorial integrity of CARs must be upheld. Amid the intensifying global competition among the major powers, Beijing is taking bold steps to augment its regional influence to counteract the US’s encirclement of China by expanding its “circle of friends”.

Since independence, the CARs have made many efforts to develop strategic autonomy in connectivity, trade, and security, but have not seen much success. This is now pushing them further into the hands of a belligerent China, even as anti-China sentiments increase in the region. This brief analyses China’s increasing heft over Central Asia and the consequent strategic implications for other regional and global powers.

Tracing Russia-China Cooperative Hegemony in Central Asia

Strategically located, Central Asia was a key area for the ancient Silk Route. The region was vital for geopolitical and geoeconomic transformations. Following the fall of the former Soviet Union in 1991, Central Asia once again became a region for fierce competition between the global powers. Russia considered the CARs its “backyard” and focussed on not letting the countries get close to the US and Europe. At the same time, the post-Soviet regimes in Central Asia were authoritarian and were sceptical of Western/European efforts to promote democratisation, the rule of law, and human rights. As a result, while the CARs urgently needed loans and investments to kick-start their economies, they fell short of World Bank and International Monetary Fund requirements, specifically in the areas of human rights and the rule of law. Additionally, Moscow’s major aim was to control regional energy politics and maintain a monopoly over Europe’s supplies, and so prevented the European Union (EU) from gaining access to Central Asia’s rich hydrocarbon reserves. As Russia struggled economically in the post-Soviet era, it was forced to create a “division of influence” with China over the region through ‘cooperative hegemony’.

Similarly, China was interested in Central Asia to secure its volatile western province of Xinjiang Uyghur Autonomous Region and the former’s rich hydrocarbon resources. Furthermore, after 2001,  China was also apprehensive of US-led NATO influence in the region to contain its rise. Consequently, Beijing provided the CARs with much-needed loans and used the political and economic instability in these countries as a bargaining chip to resolve long-standing border issues in its favour.^[b] In return for Chinese loans and investments, the CARs banned Uyghur organisations in 1997 and intensified surveillance of the resident Uyghur population across Central Asia.

As part of their cooperative hegemony, Russia and China established the Shanghai Cooperation Organisation (SCO)^[c] in 2001, becoming a key platform in defence and security cooperation for both countries. Indeed, Russia and China have conducted several multilateral military exercises since the SCO’s inception. The SCO also ensured the security of Chinese economic interests and investments through regime stability in Central Asia and against separatism in Xinjiang.

Still, China, via the SCO, sought more coordination for joint military exercises to improve confidence among the Central Asian countries against potential threats. In October 2002, China started the first such exercise with Tajikistan; the following year, all SCO members except Uzbekistan joined such programmes. At the same time, Beijing was unwilling to conduct the 2007 Peace Mission exercises with the Russia-dominated CSTO.

Since 2013, Russia has tried to prevent China’s increased engagement in CARs through different initiatives (although it recommended at the 2014 SCO summit to merge the organisation with the CSTO, but Beijing was unwilling to do so). In 2014, Russia announced the formation of the Eurasian Economic Union (EEU) with Belarus and Kazakhstan, an ambitious project for economic integration in the former Soviet region. Armenia and the Kyrgyz Republic joined the EEU in 2014. At the same time, Russia also encouraged a greater regional presence by India^[d] to counterbalance China’s growing influence. However, Chinese dynamism through the ambitious Belt and Road Initiative (BRI) and investments in hydrocarbons and infrastructure shifted the balance of power in the region in Beijing’s favour.

China’s Interest in the CARs: Energy, Investments, and Defence

Under the cooperative hegemony model with Russia, China did not openly disclose its true ambitions; instead, it worked as an investor in Central Asia. However, China’s investments in Central Asia highlight that it has adopted the classical form of colonialism through a modern perspective.

China has invested in buying hydrocarbons from the region and flooded the Central Asian markets with finished goods without regard for indigenous industries and factories. Following the 2008 global financial crisis, China provided loans to the energy-rich Turkmenistan and Kazakhstan—Turkmenistan received US$3 billion, and Kazakhstan received US$10 billion under a “loan for oil” deal with both countries. China invested US$8 billion in the China-Central Asia pipeline, which became operational in 2009. Additionally, the state-owned China National Petroleum Corporation has invested over US$45 billion in Kazakhstan’s oil and gas sector. Turkmenistan supplied 34 billion cubic meters of natural gas to China in 2021,[36] and, in 2022, Chinese gas imports from that country were valued at over US$9.2 billion. Currently, China imports 30 percent of its natural gas through pipelines connecting Beijing and Shanghai with Central Asia.

In recent decades, China has experienced an excess production of building materials, steel, and iron, but this overcapacity has led to declined profits, increased debt, and the near bankruptcy of many manufacturing companies in the country. As such, the Chinese Communist Party saw “an opportunity by ‘moving out’ this overcapacity based on [China’s] development strategy abroad and foreign policy”.[39] Under such internal and external exigencies, Xi commenced and introduced the BRI in Kazakhstan in 2013, calling it the “project of the century”[40] that could boost trade and investments in the participating countries, enhance the living conditions of their citizens, and boost global real income by nearly 2.9 percent.

As part of the BRI and through loans from Chinese state-owned banks, Chinese companies have undertaken several infrastructure projects (including constructing railways and highways) across Central Asia. Chinese cumulative investments reached US$40 billion by 2020 and 7,700 Chinese firms were operating across the CARs in 2021. The region also became a transit route for Europe-bound Chinese goods. China also provided loans to the CARs as a geostrategic and geopolitical tool to strengthen and expand its own hegemonic quest in the region. For instance, 52 percent (US$1.2 billion) of Tajikistan’s foreign debt and 45 percent (US$1.7 billion) of the Kyrgyz Republic’s external debt is owed to China. Uzbekistan owes China the equivalent of 16 percent of its GDP, Kazakhstan owes 6.5 percent, and Turkmenistan 16.9 percent. While Kazakhstan, Turkmenistan, and Uzbekistan have been able to sustain BRI debt due to the returns from rich hydrocarbon exports to China, the Kyrgyz Republic and Tajikistan—the less resource-rich Central Asian countries—are already under debt stress from China. Beijing has forced Bishkek and Dushanbe to insert clauses in the BRI projects for greater asset control if they fail to pay the debt.[44] Another important factor in the debt crisis is corruption and a lack of transparency, with many senior leaders in the CARs accused of colluding with Chinese officials to embezzle funds earmarked for BRI projects.[45] In a bid to further its geoeconomic and geostrategic aims in the region, China has created a social class through corruption by awarding contracts to officials and endorsing authoritarian regimes by supplying surveillance technologies to suppress social unrest.

At the same time, BRI projects and investments resulted in an influx of Chinese workers in the CARs, diminishing job opportunities for the locals. This has, in turn, fuelled anti-China sentiment, leading to protests and even violent conflicts against government apathy and Chinese presence. Since 2015, the CARs have seen more than 150 anti-Chinese protests, particularly in the Kyrgyz Republic, Tajikistan, and Kazakhstan. Additionally, the suppression of secular Uyghur, Kazak, Kyrgyz, and Uzbek Muslims in Xinjiang has caused increased anti-Chinese sentiments in the CARs.[48] To overcome anti-Chinese sentiments in the region, Beijing has shifted investments to manufacturing industries rather than large infrastructure projects. Under this new scheme, Beijing only lends, preferably through joint funding from recipient countries. For instance, China has entered many joint ventures with the Kazak government, such as a cement plant, the Orda glass plant, and the construction of the Yutong bus factory. Similarly, in Uzbekistan, China has invested about US$380 million in the cement industry and constructing a textile plant as joint ventures. In Tajikistan, China has established many joint ventures in mining, cement, and textiles. However, given Tajikistan’s financial woes (extreme poverty and a lack of funds), the Chinese partners will provide the bulk of the investments, and the Tajik government will provide tax benefits and free land. During the first China-Central Asia Summit in May 2023, Xi acknowledged the rising anti-Chinese sentiment and emphasised the importance of Chinese companies in the CARs creating local jobs when constructing warehouses and industries. Under such schemes, “China will provide Central Asian countries with a total of 26 billion yuan (US$3.8 billion) of financial support and grants,”. Additionally, he proposed having more special trains to encourage tourism and promote people-to-people connections.

Over the years, increased connectivity and the completion of gas and oil pipelines have multiplied the trade between China and the Central Asian countries—trade grew from US$24.7 billion in 2015 to US$70 billion in 2022.

The CARs primarily export hydrocarbons, uranium, ores, slag, and copper to China, and import finished goods, including electrical machinery and equipment, vehicles, footwear, toys, chemical products, and iron and steel finished articles from that country. In 2022, trade between China and Central Asia reached a record high of US$70 billion,[58] with China-Kazakhstan trade accounting for US$31 billion. As China seeks to enhance its food and energy security, it is looking to establish deeper links with the region. Beijing has also stressed increasing oil and gas trade, developing energy cooperation across industrial chains, and strengthening cooperation on new energy and the peaceful use of nuclear energy. Despite China’s bold claims of liberalising trade with the CARs, its borders and markets remained closed during the COVID-19 pandemic, leading to a decline in imports from the CARs in 2020. Consequently, the CARs’ trade deficit with China, except for Turkmenistan, widened and is still growing. According to trade data released by the Chinese General Administration of Customs, in the first six months of 2023, China exported goods worth about US$26.4 billion to the CARs, while imports from those countries totalled US$13.6 billion.

While China is a key partner for the CARs in terms of investments and loans, Central Asian leaders are increasingly seeking greater benefits for their countries. Consequently, during the Xi’an summit, Beijing promised “more trade facilitation measures, upgrade bilateral investment treaties, and open “green lanes” for streamlined customs clearance of agricultural and sideline products at all border ports”. Beijing also promised to hold live-streaming sales for products from CARs to decrease the trade deficit.

China is also solidifying its hard power interests in the CARs on security matters to lay a strong foundation for ‘Pax Sinica’^[e] in Eurasia. Beijing established its first military base in the Murghob district of Tajikistan, near the China-Afghan border. China has also held many joint military drills with the CARs, within the framework of the SCO and on a bilateral or trilateral basis; between 2003 and 2020, China held 45 exercises with the CARs. China also launched programmes to train the armies of the CAR countries and provide military technology assistance. The following graph shows the increase in Chinese military drills in CARs.

China is also keen to capture the CARs’ defence equipment market. The Kyrgyz Republic received US$16 million in 2014[65] and US$14.5 million in 2017 for the upgradation of weapons and accommodation of military personnel. In 2016, Kazakhstan received 30 heavy-duty trucks (Jiefang J6) and 30 large tailors worth US$3.2 million free of cost from China.[67] In Tajikistan, China has built many border posts, opened a training centre, and given grants of US$16 million to build officers’ clubs.[68] At the same time, China’s arms sale in the region has increased dramatically. Turkmenistan purchased HQ-9 and HQ-12 missile systems worth US$230 million from China in 2016; in 2018, Kazakhstan purchased a transport plane worth US$296 million; and in 2019, Uzbekistan purchased a missile system worth US$103 million. Additionally, Uzbekistan and Kazakhstan have the Chinese Wing Loong-1 attack drones in their arsenals.

Leveraging CARs Anxiety Vis-à-Vis Russia

Amid the ongoing Russia-Ukraine conflict, the CARs are trying to reduce their traditional security dependence on Moscow, which is now increasingly seen as a threat to regional stability, territorial integrity, and sovereignty. Noticeably, none of the CARs have supported Russia’s actions in Ukraine. Anticipating risks to their sovereignty and territorial integrity, the CARs are diversifying their foreign policy to minimise the Kremlin’s influence. For instance, Kazakhstan refused to recognise eastern Ukraine and accused Russian politicians of sowing discord between Moscow and Astana. Kazakhstan and Uzbekistan also reaffirmed Ukraine’s territorial integrity and sent humanitarian assistance to Kyiv, against Moscow’s expectations.

The growing anxiety in the region and Russia’s pre-occupation in Ukraine has created a promising situation for China. In September 2022, Xi chose Central Asia for his first foreign visit post the pandemic, highlighting the increased role of the region in China’s foreign policy objectives amid growing tension with the West. Xi first arrived in Kazakhstan and met with his counterpart President Kassym–Jomart Kemeluly Tokayev. He echoed support for Kazakhstan’s territorial integrity, saying, “No matter how the international situation changes, we (China) will continue our strong support to Kazakhstan in protecting its independence, sovereignty and territorial integrity… and strongly oppose to the interference of any forces in the internal affairs of your country”. Next, Xi visited Uzbekistan, where he participated in the SCO summit and held bilateral and trilateral talks with counterparts from Uzbekistan, ‘Tajikistan, the Kyrgyz Republic, and Turkmenistan.[78] He once again reiterated his support during the Xi’an summit and said that the security, sovereignty, independence, and territorial integrity of the CARs must be upheld.

Western sanctions on Russia also forced the CARs and China to establish a transportation route through Central Asia that does not rely on Moscow. For this purpose, the China-Kyrgyzstan-Uzbekistan (CKU) railway line, which was agreed upon on the sidelines of the SCO summit in 2022, has been designed to shorten the route to Europe and bypass Russia. The total length of the proposed railway line is 523 km, which includes 213 km in China, 260 km in the Kyrgyz Republic, and 50 km in Uzbekistan. China also supports the development and construction of the Trans-Caspian international transport corridor to increase the cross-border transportation of cargo from China to Europe.

During the Xi’an Summit, Xi also pledged to support and enhance regional law enforcement and defence capabilities in the wake of increased threats from terrorism and civil unrest.[82] The leaders also stressed to, “firmly uphold their core interests including sovereignty, independence, security and territorial integrity, and oppose interference in others’ internal affairs” under the Global Security Initiative put forward by Xi.

Strategic Implications for Major Powers

Given Central Asia’s geostrategic and geoeconomic importance, the CARs have adopted a multifaceted foreign policy to promote strategic autonomy and minimise China’s growing influence and Russia’s traditional sway. The CARs have avoided choosing sides in the ongoing great power competition. Central Asia is strategically located at the centre of Eurasia and acts as a crucial point for geopolitical interest; however, for trade and connectivity, the region relies on Iran and a fragile Afghanistan. As such, the region provides China with cheap hydrocarbons and an overland route to the different markets in Eurasia.

China’s growing heft over the strategically located Central Asia has left the US, EU, and even India with limited options for engagement. In February 2023, US Secretary of State Antony Blinken visited the region for dialogue under the ‘C5+1’ format and announced a US$25-million plan to expand regional trade routes, establish new export markets, and attract and leverage more significant private sector investment. Blinken also stressed US support for an independent, prosperous, and secure Central Asia.[84] In September 2023, US President Joe Biden met the presidents of five Central Asian countries on the sidelines of the United Nations General Assembly, discussing security, trade, investment, and regional connectivity, particularly the development of the Trans-Caspian Trade Route. Biden also stressed territorial integrity and the need to respect the sovereignty of all nations.

These developments underscore Washington’s growing interest in the CARs amid its damaged global standing following the return of the Taliban in Afghanistan.[87] However, the US strategy in Central Asia has been largely reactive and restrained, leaving it inconsistent, under-resourced, and uncompetitive compared to China. If the US wants to maintain its position as a regional competitor, it must change its approach. The US’s Central Asia policy has always stressed promoting human rights, press freedom, democratisation, and internal reforms, and there is some progress on this front (albeit slow). For instance, Uzbekistan and Kazakhstan have implemented constitutional reforms to improve the rule of law and gradually transition towards democracy. Therefore, US foreign policy must exhibit patience and maintain a long-term focus.

In recent years, the EU has actively pursued a new strategy towards the region, focusing on connectivity and cooperation for peace and security in Afghanistan.[88] Geopolitical considerations amid the Russia-Ukraine war have further enhanced this regional engagement. The Ukraine crisis has forced the EU to look for alternative transit and trade routes that bypass Russia. Still, additional funding from European institutions is needed to make this a reality, especially the ‘Middle Corridor’.^[f] In June 2023, European Council President Charles Michel held a second regional high-level meeting with the leaders of Uzbekistan, Kazakhstan, Tajikistan, and the Kyrgyz Republic, and the deputy chair of Turkmenistan. The meeting reviewed the EU-Central Asia cooperation and the implications of international developments. since the inaugural meeting in Astana, Kazakhstan, in 2022. Despite these efforts, the authoritarian Central Asian governments have had an ambivalent stance towards the EU, given the latter’s insistence on human rights, the rule of law, and good governance.

India has taken significant steps towards strengthening its relations with the CARs by implementing several programmes and through the ‘Connect Central Asia’ policy (initiated in 2012). However, Pakistan’s unwillingness to allow passage to the CARs through its territory has hindered India’s efforts. Indian Prime Minister Narendra Modi’s visit to the Central Asian countries in July 2015 showcased that New Delhi views the CARs as a ‘zone of interest’ by seeking to revive the old cultural and commercial relations with Eurasia. The CARs also admitted India to the Ashgabat Agreement to facilitate New Delhi’s commercial and strategic interests. The CARs perceive connectivity projects initiated by India (such as the Chabahar port) as a game changer for the region. With India’s sustained economic growth and transformation, the Central Asian countries consider New Delhi a crucial player in the Eurasian region. While the India-led connectivity projects are seen as an opportunity, some challenges must be addressed.

Beijing’s efforts to promote its governance model, security doctrine, and surveillance techniques could have far-reaching consequences on the American, European, and Indian interests in the region. Furthermore, the CARs are looking for viable options to have strategic autonomy and minimise China’s growing influence and Russia’s traditional sway. The EU, the US, and India must work together on connectivity projects, such as the Middle Corridor and the International North-South Transport Corridor, and must leverage their existing initiatives with the CARs to counter China. While it may be tough to entirely prevent a rising China in Central Asia, the EU, the US, and India can help the CARs with some long-term strategic investments in connectivity projects, offering these countries an alternative to connecting to the world.

Conclusion

Russia’s focus on Ukraine and its waning influence in security and defence in Central Asia has given China an advantage in the region. Unlike the US, the EU, and India, China has accorded top priority to the region. Beijing has created a strong line of defence and economic opportunities in its periphery, thus aiming to achieve multiple objectives in geopolitics, military might, soft power, and economics. The fragile global order has allowed China to expand its circle of friends. Increased cooperation in areas of security and defence may likely see the CARs aligning with Beijing rather than Moscow. Although cooperative hegemony between Russia and China continues, Moscow is becoming the ‘junior partner’ in the region. At the same time, Beijing’s growing interests can make Central Asia vulnerable to social unrest and revolts against the current regimes, a concern the region’s leadership must not take lightly.

[a] Russia, Kazakhstan, Tajikistan, Uzbekistan, the Kyrgyz Republic, and Armenia signed the Collective Security Treaty in 1992, which became the Collective Security Treaty Organization in 2002. Turkmenistan never became a member, and Uzbekistan exited the organisation in 2012.

[b] In 1996, Russia, China, the Kyrgyz Republic, Kazakhstan, and Tajikistan formed the ‘Shanghai Five’ to resolve longstanding border disputes through confidence-building measures. The following year, they signed the Agreement on the Mutual Reduction of Armed Forces. China sought Russia’s assistance in facilitating negotiations to resolve its prolonged border issues with Kazakhstan, the Kyrgyz Republic, and Tajikistan. The disputes were eventually settled with Kazakhstan in 1994, the Kyrgyz Republic in 1996, and Tajikistan in 2002, with China receiving 22 percent, 32 percent, and 3.5 percent of the claimed land from each country, respectively.

[c] The Shanghai Cooperation Organisation (SCO) was initially established in 1996 as the ‘Shanghai Five’ by China, Kazakhstan, the Kyrgyz Republic, Russia, and Tajikistan to promote measured collaboration in Eurasia on regional geopolitical, geoeconomic, and geostrategic challenges. The group was renamed in 2001 after the inclusion of Uzbekistan. In 2005, India, Pakistan, and Iran were granted observer status, with India and Pakistan becoming full members in 2017. Since 2008, the SCO has also inducted several other countries, including Azerbaijan, Armenia, Cambodia, Sri Lanka, Nepal, Egypt, Saudi Arabia, Qatar, Maldives, Bahrain, United Arab Emirates (UAE), Kuwait, and Myanmar, as dialogue partners under Article 14 of its charter. Iran became a full member in 2023, making the SCO the world’s largest regional organisation with nine member states, covering 60 percent of Eurasia, home to over three billion people, and accounting for a quarter of the global economy. Belarus, Mongolia, and Afghanistan are currently observers and are also interested in becoming full members.

[d] Russia played a crucial role in advocating for India’s full membership in the SCO during the Tashkent Summit in 2016. This decision was also backed by Kazakhstan and Tajikistan. By being a full member of the SCO, India would have more leverage in formulating its policies to effectively tackle China’s ambitious initiatives, such as the Belt and Road Initiative and the China-Pakistan Economic Corridor.

[e] A China-led era characterised by peace and stability.

[f] ‘Middle Corridor’, also known as the Trans-Caspian International Transport Route, is gaining traction among CARs, Azerbaijan, Georgia, Europe, and Turkey. This route passes through Central Asia, the Caspian Sea, and the South Caucasus, and it is the fastest and shortest reliable route. The route comprises over 4,250 km of rail lines and 500 km of the seaway. It is 2,000 km shorter than Russia’s Northern Corridor, which makes it an ideal solution to sanction-compliance issues.  – orfonline.org –