by Darshana M. Baruah. She is a Junior Fellow at the New Delhi based think tank, Observer Research Foundation, is working on the South China Sea and has completed her Masters in International Relations from Cardiff University in 2012.Maldives on July 22, 2015 passed a law which could change the current power dynamics of the Indian Ocean region. The law passed by the Parliament will now allow absolute foreign ownership of land in Maldives if the investment is above USD 1 billion. The caveat to the law is that 70% of the land has to be reclaimed from the sea. Announcing that the move is aimed at boosting the Maldivian economy and is an effort to attract foreign investments, the government has limited the availability for such ownership to 10% of the existing island (“Maldives foreign land ownership reform bill is approved“, BBC News, 23.07.2015).
The new law raises significant strategic implications for the region due to its location in the Indian Ocean region. China is intently looking to invest in infrastructure projects in the Indian Ocean region, and consequently linking them to its ambitious 21st Century Maritime Silk Road. The conditions that interested parties would have to make a minimum investment of USD 1 billion and reclaim 70% of the land from the sea suit Beijing perfectly. China is already engaged in massive land reclamation activities in the South China Sea and its growing economy is allowing Beijing to expand its reach out of its immediate neighbourhood. Chinese projects such as infrastructure building and economic corridors are of particular concern to India. Sino-Indian rivalry in the maritime domain is a new geo-political theatre that is yet to be tested – making India in the region wary of Chinese expansion into the Indian Ocean.
A primary concern for New Delhi regarding Malè allowing foreign ownership of land is the possibility of Chinese buying large amounts of land which could later be used for military purposes. Both China and Maldives have brushed off any strategic implications from such a project and Malè has assured India that it will not allow China to build a military base on Maldivian sovereign space. Nevertheless, the assurances have not been successful in appeasing India, and New Delhi continues to be extremely cautious of such developments.While China insists that its overseas investments are commercial in nature, owning property from reclaimed land in the Indian Ocean will have considerable strategic implications for India. Hence, despite repeated assurances New Delhi is uneasy about opening up new possibilities for China to increase its presence in the Indian Ocean. Although India has an advantage over China as far as the Indian Ocean is concerned, New Delhi’s doubts are not unfounded.
International law is not set in stone and is based on the goodwill of all parties to uphold established laws and norms. Currently in focus is the Philippines initiated UN arbitration on the South China Sea against China. Beijing has refused to participate in the proceedings and has disregarded a well established mechanism stating it does not have the jurisdiction to resolve bilateral issues in international waters. Even though the court comes to a decision regarding the dispute, China is not obliged to accept it nor is there any effective mechanism to implement the verdict. Yes, China will lose some of its moral standing in the international order but it will also continue to assert its claims in the South China Sea with no effective resolution in sight.
Furthermore, some aspects of international law are open to interpretation. The UN charter when created was solely aimed at preventing another war. Over time, geo-political tussles along with strategic interests have led nations to interpret laws in their favour. The US and China have different interpretations regarding the rights of a state in its Exclusive Economic Zones (EEZ). The US debate is that the coastal state enjoys economic rights in its EEZ, but all nations have a right to passage through EEZs, including military vessels. Beijing is of the view that while commercial ships carry the right to innocent passage through an EEZ, coastal states reserve the right to evict foreign military vessels from its EEZ. This difference in interpretation of international law has led to incidents on high seas between US and Chinese naval vessels. It is also pulling the US deeper into the South China Sea disputes as Washington fears that by creating artificial islands, Beijing can extend its EEZ into international waters and impose its interpretation of laws.This indicates that even if the foreign property in Maldives is being used for commercial purposes, there is always room to consider it for strategic objectives. The docking of Chinese conventional submarines in Colombo, Sri Lanka last year – twice, for refuelling and replenishment purposes – lends weight to this argument. While Sri Lanka and India have an understanding on respecting each other’s security concerns, it is interesting to note is that the port where the submarines docked has been built by a Chinese company that holds 85% of its ownership.
China has well articulated its desire to play a role far beyond its shores in its 2015 White Paper on Military Strategy. The White Paper clearly states that Beijing is gradually shifting “its focus from offshore waters defense to the combination of offshore waters defense with open seas protection”. Beijing wants to secure its maritime links in the Indian Ocean and to take on a stronger security role in the current world order. It is on track “for realizing the Chinese Dream of achieving the great rejuvenation of the Chinese nation”. No country or mechanism can block Chinese expansion into the Indian Ocean, which is being complimented by the Maritime Silk Road and bilateral commercial infrastructure projects in the Indian Ocean region. While New Delhi is accepting of this reality, it remains uncertain of the best way forward in managing these developments. On the other hand, while China is increasing its forays into the Indian Ocean, it is yet to find a way to sustain its presence. In order to pursue its changing focus on maritime security and expand its operational capabilities in the Indian Ocean, China will have to find or create facilities to maintain its strategy.
What is worrisome is that China is not looking to compete with India or any other power in the region. It has set its goals at matching its capacity to that of the US and establishing itself as another super power, if not the only one, in this region. It definitely has a long way to go in achieving this dream, but it nevertheless has started the journey.
Chinese presence along India’s land borders is a major factor in the Sino-Indian rivalry. Given the history, it is only natural for New Delhi to be uneasy about prospects of China establishing a permanent presence in its maritime neighbourhood in whatever form it may be. Maldives allowing foreign ownership of land is in favour of Chinese interests. It blends well with Beijing’s ongoing strategy to mark its presence commercially at the international level. India has to factor in the challenges that such a development may throw up for its own strategic interests in the region. It is uncertain how such a development will play out; whether, at any point of time, China owning land near critical sea routes would affect India’s military and commercial interests; or if it will add to the Sino-Indian rivalry due to difference in interpretation of international maritime laws in the Indian Ocean.
The Chinese entry into the Indian Ocean region is altering some of the established power dynamics in the region. It is certain that the rise of a nation is bound to change the established order. The point in debate is how much of it will alter and how soon. India is aware of the changing security environment in its neighbourhood and keen on playing an active security role in the Asia Pacific and the Indian Ocean region. For now, the possibility of Chinese infrastructures on Chinese owned land in the Maldives is a serious concern to India’s security and strategic interests.
It was not a land reform bill but a Constitution amendment (even the BBC named it this way).