On the issue of any country blockading China's sea trade from the Indian Ocean and then to the Pacific and China...and blockading the Chinese made goods that flow back into the Indian Ocean and to all other oceans and seas...
I think that would have such adverse knock-on effects to world trade generally that no country would use such a blockade strategy.
China's sea trade is critically important to World economic health, particularly China's major trading partners which happen to include the USA,
South American countries, most European countries and most countries in Asia.
That includes India itself, Japan, the Koreas, Taiwan, Southeast Asia and Australia as well as most major economies I haven't mentioned.
Also OPEC values China's demand for oil highly. An unhappy OPEC, especially Saudi Arabia, would also have adverse international trade and financial impacts.
In this intensively globalised world curtailing China's trade would rapidly impact, even close, stock exchanges, currency markets, metals and primary products markets, US debt bonds and every other economic balance.
China has a very large economy - so it cannot be marginalized like much smaller economies, for example:
- Japan's economy prior to 1941 and even that led to the Pacific War
- the Soviet Union's comparitively small economy during the Cold War, or
- the Soviet Union's comparitively small economy during the Cold War, or
- Russia's comparitively small economy today (which is one tenth of China's).
Take out China's goods servicing the international supply chain and you take out world trade.
Take out China's goods servicing the international supply chain and you take out world trade.
Blockading China's trade is not a viable naval tactic, given the high costs to everyone.
10 comments:
The points you have raised in this piece are valid, for now. However, I'm yet to see any other viable means at India's disposal that would allow us to impose costs on China without escalating to the nuclear level.
As of supply chains, we have to come to terms with the fact that the globalized world & war were never meant to go hand in hand. Russia's war with a relatively small country with a very small economy has proven to have the potential of such far-reaching effects as to starve Europe of energy to the extent where they're having to consider going cold in the winter, plus is about to impose food security issues on large parts of the world which are dependent on import of wheat (Russia & Ukraine are both major exporters) because the only viable ports for shipments are in the Black Sea, which is now a war zone where no cargo ship is willing to go and no shipping insurance company is willing to write off on.
So yes, if the time comes for Asia's No.1 and No.3 economies (and the world's top 2 most populous countries, both nuclear-armed) to go to war, the costs on the globalized order are guaranteed to be several orders of magnitude worse. Yet, if these countries feel their core national interests are threatened, I find it very unlikely that they'd choose to roll over and let the other side have it's way for the sake of keeping the supply of plastic toys & low-end semiconductors going.
Pete
On the general question of naval strategy and tactics in the Indo-Pacific (as opposed to policy and procurement) I found this video of a professionally run wargame in the US of a China - USA - Taiwan wargame interesting.
https://www.youtube.com/watch?v=qYfvm-JLhPQ
A bit disturbing how quickly Australia became drawn into it.
Pete
I have given this some further thought and, while I agree with most of your points, I think there is more to it, and this possibility (blockade) could still be both a future source of conflict in the Indo-Pacific, and a potential tactic by either side if a conflict becomes an actual shooting war. The wargame I referred to above, which was played by several US strategic thinkers, illustrates their thinking.
1. China has been intentionally moving its economy from export orientated to domestic consumption orientated for a decade. Only 16% of China's GDP depends on imports now. So China is presumably preparing for this risk since Xi came to power.
https://en.wikipedia.org/wiki/List_of_countries_by_trade-to-GDP_ratio
2. The key challenge for China would be oil, for which it is heavily dependent on imports. It is the largest oil importer in the world. India sits right on the oil import route to the mid-east. The map below is very useful. India and, to a lesser extent, Australia, have a great potential to blockade Chinese oil imports through Indonesian straights in the event of a war.
https://i.insider.com/576ab27b9105841d008cad3c?width=1300&format=jpeg&auto=webp
3. Other key trade routes through the South China Sea that China could blockade with its navy and island bases include both Australia and India (and Europe) to Korea and Japan. For Australia and Japan this would be economically devastating, as Japan is Australia's second largest export destination, while Japan relies heavily on Australian coal and gas. This highlights the significance of a potential Chinese base in the Solomons. If China were blockaded, it could in turn blockade Australia and Japan.
4. Against this, the USA is moving to be less dependent on trade with China, increasing the potential for it to use a blockade strategy in the event of an actual conflict. The USA is also now self sufficient in oil thanks to fracking. In short, it could blockade China with much less to fear in return. Conversely, USA is still very dependent on Taiwan for semi-conductors. Taiwan makes over 50% of the world's semi-conductors.
5. So in conclusion I think the question of trade blockades in Asia, assuming a war or conflict, is a real risk. There are asymmetries whereby it would be in the interests of some powers to use a blockade strategy in the event of a conflict. Obviously starting a blockade could cause a war, so I do not suggest anyone should mount such a strategy during peace time. But if there were a war, the risk is real IMO.India and USA could use blockade to exert real leverage. China, Japan and Australia are vulnerable to blockade IMO. Australia might be well advised to develop more trade with India than China, Korea or Japan, as it would be more secure.
6. The situation in Ukraine now, with Russia blockading Ukraine's Black Sea ports, including around 30% of world grain exports, demonstrates the risk. It is damaging the entire world's economy, but a country losing a war it foolishly started is not going to be deterred by unpopularity.
If west does not threaten blockade, deterrence of PRC attack on Taiwan is reduced.
But in that case, what would be response to PRC blockade of Taiwan?
For this reason (maintain threat of counter blockade), I think Taiwan needs to acquire means to threaten PRC shipping, such as mobile mines, UGV's, and long range cruise missiles.
Without deterrence, PRC temptation to blockade Taiwan is way too strong, and there is no clear point for West to prevent escalation. It is even in West's interest to support this move.
Anonymous
Good point about Taiwan. Taiwan is not self sufficient in food. So not only would a blockade of Taiwan prevent semi-conductor exports and strangle its income, it would block food supply and eventually force Taiwan to surrender.
Bearing this in mind, you can see why the Chinese would want to capture the Senkaku and Rjyuku islands so much, and how Japan could so easily become involved in such a war.
Hi Gessler and Anonymous's
If India decided to block China's trade:
- in/out of the Malacca Strait and other Indonesian straits
- or a blockade closer to the Chinese coast
this may cause a major backlash of many countries caught in the middle.
Remember the US-UK War of 1812 where the UK stopping US ships from trading with France. This was one major reason for that War https://en.wikipedia.org/wiki/War_of_1812#Impressment,_trade,_and_naval_actions
So one problem is India blocking other nations flagged ships.
Non-Indian countries rate their trade with China, the world's second largest economy, highly. In particular Mid East oil and gas, EU cars, EU and US passenger aircraft, and machinery and imports from China.
Also how can India be certain of the destination of oil and gas tankers for Indian Ocean to the Pacific Ocean. Might India be inadvertently blocking oil and gas destined for Japan, S Korea, Taiwan and Singapore (Singapore refines oil for the Australian market)?
I can accept the US (with its economic and political power) could arrange an international blockade of (or Trade Sanctions against) China but I doubt India could do it.
Also India's close relations with Russia and Russia's close relations with China makes many things problematic.
The 4 largest economies internationally https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)#Table : US, China, Japan, Germany, might resent the 5th largest economy (India) upsetting world trade.
This might also ("what's there to lose") tip China to invading Taiwan before China runs out of oil.
Pete
"Also how can India be certain of the destination of oil and gas tankers for Indian Ocean to the Pacific Ocean. Might India be inadvertently blocking oil and gas destined for Japan, S Korea, Taiwan and Singapore (Singapore refines oil for the Australian market)?"
This one I know. There is OSInt satellite data on the real time location of every registered commercial vessel in the world, their origin and destination. You can even track their voyage. Just as it has never been easier to find warships, it has never been easier to define and enforce a selective blockade. Ship operators could try to cheat the system, but they would soon be found out with tracking.
Hi Pete,
While we are dealing in hypotheticals here, and if there's anything recent events have shown it is that countries can be extremely unpredictable, here's some observations (and clarifications) regarding the discussion above:
1) It's very unlikely that any sort of blockade would be the go-to method for India to counter China's moves. As the "land-centric" content of my previous posts make it amply clear, such a move would be out of desperation, and likely only made when faced with an existential crisis that would nullify most of India's considerations of other countries' concerns. Such as if China were to make efforts to cut off India's water supply.
2) As recent events show, there has been considerable pressure from the US urging European countries to cease import of energy from Russia - even before the war, the pressure on Germany to dump projects like Nord Stream-2 was considerable. And as the war continues, much of Europe is going to have to choose between having a secure energy supply, or political alignment that suits the US' interests even at the cost of their own energy security & economic well-being, but they will not have both.
https://www.bbc.com/news/business-61237519
https://www.bloomberg.com/news/articles/2022-04-29/recession-threat-hangs-over-europe-s-fragile-economic-growth
The US may not necessarily care too much about its Allies' energy supply being secure, so long as it perceives the situation as hurting the US' enemies more than it hurts its Allies. Today that enemy is Russia, it would very well be China tomorrow - especially if such a move by China coincides with an attempted invasion of Taiwan. Not to mention, the hurt placed on Russia by not buying their oil/gas is merely economic, the hurt on a manufacturing economy like China on the hand could be catastrophic.
3) Countries friendly to India 'downstream' from the straits like Japan or South Korea would also obviously be hurt by such a move - another reason why I do not rate such a decision by India to be a trivial matter that would be done at the drop of hat but something that sits directly below all-out nuclear war on the escalation ladder. I think its important not to lose perspective of that.
As a side note, regarding the points about trade you have raised...I think its important to note that ANY conflict in the Indo-Pacific, especially in or around the South China Sea (to include the straits that lead into it) would have devastating effects on global trade. The conflict need not necessarily even involve an official blockade, the mere fact that missiles are flying out and hitting ships in those waters is enough to put a hard stop on freight vessels going in & out of that whole region.
And its important to also remember that a conflict in this region between China and one or more of its unfriendly neighbours in the area such as Taiwan, Philippines, Vietnam etc. (which would have a very high chance of the US & Japan quickly becoming involved) is FAR MORE LIKELY to happen than India & China declaring an all-out civilizational war.
And yet, the effects on global trade arising out of such a conflict would be much the same as would be the case if India blockaded the Malacca Straits. Which is why even though the context of the observations I initially made (regarding India & China) were hypothetical in nature, we must not think of such a disruptive event as equally hypothetical. In my opinion, it is far more likely to actually happen due to conflicts between East Asian powers.
Thanks Anonymous [at May 23, 2022, 9:44:00 PM]
For your reply:
"This one I know. There is OSInt satellite data on the real time location of every registered commercial vessel in the world, their origin and destination. You can even track their voyage. Just as it has never been easier to find warships, it has never been easier to define and enforce a selective blockade. Ship operators could try to cheat the system, but they would soon be found out with tracking."
One OSInt service is https://www.marinetraffic.com/en/ais/home/centerx:142.0/centery:12.3/zoom:4
Cheers Pete
Hi Gessler [at May 24, 2022, 2:12:00 AM]
In my attempt to bare bones summarize, I would say.
In long anticipated situations, like a Chinese invasion of Taiwan, the US has most probably already developed plans to:
1. organize allies (from the Quad, AUKUS, NATO and other alliance structures) to participate in an armed coalition against China
2. quickly put in place strict economic sanctions (imports from, exports to China and financial measures) by countries in all above alliances and other regional and Western countries
By such sweeping multilateral actions there's less chance of unilateral/unrecognized incidents of needing intercept unwilling vessels from countries who are not part of the broad anti-China actions.
On less clarified international crises involving China the foreign/state departments and Defense Departments of Western countries (and India) would already have had discussions and understandings. This is part of ongoing Diplomatic and Defense planning activities done by most medium to larger powers.
On totally unexpected situations operations and planning staffs at the Diplomatic and Defense levels and national Leaders can quickly email each other on alliance building and other actions.
Regards Pete
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