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9 July 2015

Forget Russia-China alliance

While the Kremlin rhetoric favors Russia-China alliance in fact it is very unlikely 

It sounds scary: a 21st century Russian-Chinese military-political alliance that will tip the global balance of power against the United States. In this narrative, the combination of Russian natural resources and military technology anchored to China’s massive population and growing economic power would allow the two countries to rewrite the global rules for everything from trade to the environment to human rights.

Beyond the rhetoric however, is there a sufficient overlap of interests between Russia and China for the two sides to form a true strategic alliance? On the surface the answer is yes.

Ideologically, Russia and China see the United States’ focus on promoting democracy and human rights as unwarranted intrusions in other states’ internal affairs. Both Moscow and Beijing resent American power and believe that the American-dominated international order should be replaced by a multipolar world. From President Putin’s perspective, NATO expansion and its support for Ukraine represents an American desire to surround and control Russia. Likewise, Chinese leaders believe President Obama’s “pivot to Asia” is really about containing China. 

Military cooperation is another area of Russian-Chinese cooperation. In May, the two sides’ navies conducted joint-maneuvers in the Mediterranean Sea and further drills are planned for the Sea of Japan in August.

Finally, there is burgeoning economic cooperation between Russia and China, primarily in the area of energy. After ten years of negotiations, Russia and China signed a massive 30-year, $400 billion natural gas-supply contract with China, and the Chinese recently began construction on a planned 4,000 kilometre gas pipeline.  

Observing the Russian-Chinese entente, some analysts argue that the United States faces a grave threat from this developing “axis of authoritarianism” and that the powers could even form the equivalent of a Eurasian NATO. While this sounds worrisome, a combination of differing regional interests and mutual suspicion — primarily unspoken Russian fears regarding China's rise — make a formal alliance between Moscow and Beijing highly improbable.

The key issue inhibiting a true Russian-Chinese strategic alliance is the growing power imbalance between the two states. The Chinese economy is six times the size of Russia’s and growing rapidly, while the Russian economy remains in a deep recession due to the drop in oil prices and Western sanctions.

A clear example of this power disparity is the recent gas contract between Russia’s Gazprom and China National Petroleum Company (CNPC). While $400 billion sounds like a lot of money, the deal tilts strongly in China’s favor. According to a recent study, Gazprom will be lucky to break even on the contract – and may even suffer substantial losses. The Chinese are also taking advantage of Russia’s exclusion from Western financial markets due to Western sanctions by charging Gazprom significantly higher interest on a $25 billion financing package than what Gazprom used to receive from Western banks.

“The Chinese are extremely tough negotiators and are clearly taking advantage of Russia’s weakened position versus the West due to Ukraine,” said Stephen Blank, a senior fellow at the American Foreign Policy Council who studies the Russia-China relationship. “Putin desperately needs a non-Western outlet for Russian gas – the Chinese know this and they will not cut the Russians any breaks,” continued Blank.

The one-sided gas brings up a broader problem for Moscow: Russia risks becoming nothing more than a supplier of raw materials for China, duplicating the same type of neo-colonial relationship China has with Africa. As in the Chinese-African relationship, China buys natural resources from Russia, but then processes these in China and sends back finished goods to Russia. China has also begun to purchase farmland in the Russian Far East, but reportedly brings in Chinese laborers, uses soil-poisoning fertilizers, and then ships the produce back to China.  

“Every alliance has a horse and a rider. Economically, Russia is increasingly the horse," said Blank.

Russia also worries about the threat from China in the Russian Far East. Russia seized the region from China in the nineteenth century at the height of Chinese weakness – something nationalists on both sides of the border remember – and the two sides also fought a short but sharp border war there in 1969.

As a result, Russians possess distinctly mixed feelings about the rise of Chinese power. On the one hand, Russian analysts believe Beijing’s current focus is southward towards the South China Sea, but on the other the Russian establishment worries China’s ambitions could one day turn northward. As a result, one senior Russian general described Russia’s main enemy “in the east…as a multi-million-man army with a traditional approach to conducting combat operations” – an obvious reference to China.

Indeed, in 2006 and 2009 China held exercises simulating long range land operations, which the Russian high command understood was directed against them. Russia has engaged in military muscle-flexing of its own. Its Vostok-2010 maneuvers concluded with a simulated tactical nuclear strike on an invader meant to be China’s Peoples’ Liberation Army, and Russia’s largest exercises to data – involving 160,000 troops, 5,000 tanks and a number of ships and aircraft — were held in the Russian Far East and meant to deter China.

Blank describes Russia’s fear of China “as the threat that dare not speak its name in Moscow,” but he noted that when Russian military and defense analysts speak privately about China they express great concern about Beijing’s growing power.

Moscow’s diminishing power vis-à-vis Beijing power is also visible on Russia’s home turf in the former Soviet republics of Central Asia, where Chinese economic strength is rapidly pushing Russia aside. By linking Chinese territory directly with oil and gas field in Kazakhstan and Turkmenistan, China undermines Russia’s strategic position in the region by ending Russia’s ability to control the flow of Central Asian energy resources to world markets. More recently, China’s Silk Road initiative – an ambitious plan to link together the Chinese and European trade markets via billions of dollars of Chinese infrastructure investments – threatens to supersede Russia’s nascent Eurasian Union and expand the geopolitical competition in the region.  

To hedge its bets against this growing Chinese power, the Kremlin is cultivating military relationships with other Asian powers — many of whom have their own differences with Beijing. For example, despite Chinese-Vietnamese antagonism regarding Beijing’s claims of sovereignty over the South China Sea, Gazprom just concluded a joint-venture with Vietnam to drill for gas in the region. On the military side, Russia recently signed a mutual defense pact with Vietnam and expanded weapons sales to Hanoi, including several Kilo-class submarines which are far more advanced than submarines Russia sold to China. At one point, China even demanded that Russia leave the South China Sea – a request the Kremlin ignored.

Russia also sold 13 billion dollars of arms to India in 2012-2013— a country with which China has an increasingly open strategic rivalry — and Putin and Indian Prime Minister Narendra Modi recently reaffirmed the two countries' longtime alliance, with Modi describing Russia as a "pillar of strength" for his nation. The two countries also signed a series of major energy agreements, and Russia will build ten new nuclear power plants for the India.

In sum, while Russia welcomes the opportunity to piggyback on China’s growth, Russia’s quiet but growing fear of China - as well as the Kremlin's likely unwillingness to accept a “little brother” style of relationship with Beijing - makes a formal anti-American alliance between the two Eurasian powers unlikely. 

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