THE BIG STORY

’S ASIA POLICY CHALLEN

EN GES
BID
NEW YORK With China ascendant, tensions in the Taiwan Strait Kingdom and Down Under. After more than a decade of trade
AN escalating, the pandemic surging in India and Japan, Myanmar dependency on Beijing -- sending a third of its exports to that

A TO Z GUIDE
spiraling and the U.S. withdrawing from Afghanistan, the new
U.S. administration of Joe Biden has declared the Indo-Pacific as
the most important region on its radar. But what are the policy
challenges it faces on the world’s largest continent?
FOR Read on for Nikkei Asia’s A to Z index of what is in store for
country alone -- Australia seems to have firmly embraced its
alliance with the U.S. as a pillar of its foreign policy. The tensions
began gradually, first in 2018 with Canberra banning Chinese
telecom companies (read ZTE & Huawei below), and escalated
in 2020 when it suggested that investigators be sent to Wuhan

THE WHITE HOUSE

America’s new president in Asia. to probe COVID-19’s origin. China responded with aggressive
tariffs, and has now slammed an indefinite suspension of a key
economic dialogue with Australia. That follows Canberra’s own
AUSTRALIA | Are Canberra and Beijing breaking punitive measures: using a recently passed law to cancel Belt
up? One of the biggest recent geopolitical shifts in the and Road Initiative infrastructure deals with China on the basis
The new US administration has its work Indo-Pacific is the widening schism between the Middle of national security.
cut out for it on the world’s biggest continent BALOCHISTAN | Bordering Iran and Afghanistan, this
insurgency-ridden yet geostrategically important province
WAJAHAT S. KHAN Nikkei staff writer
in southwestern Pakistan is ground zero of China’s Belt and
Road Initiative, housing BRI’s $65 billion flagship project, the
China-Pakistan Economic Corridor. But there’s more to barren,
mountainous Balochistan. According to the U.S. Department
of Defense, Beijing is considering adding a naval presence at
and around the under-construction port of Gwadar, potentially
allowing it to dock People’s Liberation Army naval ships at
the mouth of the Persian Gulf. The Pakistanis and other BRI
partners have pivoted to China because of scarce alternative
Australian Prime funding options, but Islamabad is still making friendly noises.
Minister Scott Morrison participates
Will the Biden administration be able to counter the BRI with
in the inaugural Quad leaders
meeting from Sydney on March 13. its own offerings or let China chip away for more influence in
the region?

AP
CHINA | Former President Donald Trump’s Then-U.S. President Donald Trump and Chinese President
Xi Jinping at the G-20 summit in Osaka on June 29, 2019.
trade war has spilled over into great power
competition, featuring a tech and tariff battle,
a supply chain race, a debate over human rights, and an
increased threat of military confrontation. But China is
not just America’s greatest foreign policy challenge. It is
“our most serious competitor,” according to Biden -- and
expected to overtake the U.S. to become the world’s biggest
economy by 2028, according to the U.K.-based Center for
Economics and Business Research. As vice president, Biden
supported Barack Obama’s “Pivot to Asia,” but Team Biden
is trying a new approach. By shoring up America’s decades-
old alliances (like those with Tokyo) and signing on newer
Illustration by Eric Chow

partners (like New Delhi) while regrouping with European

allies slighted during the Trump era (like Germany), the

Reuters
Biden administration is aiming to form a broader front to
stand up to Beijing.

Nikkei Asia - Special excerpt from May 17-23, 2021 Print edition. Nikkei Inc. No reproduction without permission.
 THE BIG STORY

A U.S. 7th Fleet vessel transits

the East China Sea in front of GUAM | The concentration of American
Mount Iodake in April 2020. military on this tiny U.S.-administered
territory in the middle of the Pacific is
presenting a vulnerable target. That is why the Department of
Defense is looking to change things, ending permanent strategic
bomber presence on the island in 2020 to keep up with the
National Defense Strategy’s recommendation for U.S. forces to
“be strategically predictable, but operationally unpredictable.”
Whether forces are redeployed or not (Marines are expected
to be transferred here from Japan, but there is opposition from
environmentalists), expect Guam to remain an essential part of
the U.S. military’s strategic posture in the Indo-Pacific.
HONG KONG | The timing could not have been more
ironic. On Jan. 6, as marchers intending to storm the U.S.
Capitol were amassing in Washington, a thousand officers of
the Hong Kong police started the single largest wave of arrests
since the former British colony’s activists began their rights
movement in 2019. By the end of the day, the message from
Beijing to the not-yet-installed Biden administration was clear:
the U.S. as a strategic partner. A
2020-21 ISEAS-Yusof Ishak Institute
poll of ASEAN members ranking
the most influential powers in
Southeast Asia placed the U.S. at 7.4%
compared to China at 76.3%, proving
that Beijing’s robust infrastructure and
vaccine diplomacy regime dominates Indonesia and the region,
outmatching the U.S. by billions of dollars.
KABUL | Exit is imminent, but at
what cost? State-building has regressed, the
Taliban are stronger than ever, the Pakistanis
are firmly in China’s camp, and the Iranians have their
own negotiations with the militants. Moreover, violence
is higher than last year, and the chances of Afghanistan
descending into chaos
remain likely if the

Courtesy of U.S. Navy

Do not interfere. Despite serial admonition from the State withdrawal is not properly
Department and critique from Secretary of State Antony Blinken executed. But even after the By September,
via Twitter, China’s position has not budged. Meanwhile, last U.S. soldier leaves on the U.S. plans
Washington is now being called out openly by Beijing for not Sept. 11, Biden will have to have

EAST CHINA SEA | When Japan
announced the purchase of three of the Senkaku
Islands (which Beijing claims and calls the
Diaoyu) in 2012, China responded with almost everything
it had, including joint combat exercises. Fast forward to
2021, and the conflict has escalated beyond drills: January
DYNASTIES & DICTATORS | Myanmar’s
brutal junta vs. Aung San Suu Kyi’s ethnically divided
democrats. India’s liberal but disorganized Gandhis vs.
Prime Minister Narendra Modi’s violent yet efficient Hindutva. The
list of Asia’s conflicting and complicated power dyads -- and roster
of popular strongmen like Philippine President Rodrigo Duterte,
pro-establishment frontmen like Pakistan’s Prime Minister
Imran Khan and unpopular royals like Bangkok’s King Maha
Vajiralongkorn (read Rama X below) -- pose a larger question for
saw the passage of China’s new Coast Guard law (which
allows the force to shoot at foreign vessels), and in April, its
aircraft carrier came sailing through Japan’s Miyako Strait.
As the U.S. underscores its defense pact with an increasingly
alarmed Tokyo, the East China Sea heats up as a regional
point of contention.
FIRST FLEET | Trump-era plans to reinstate the
deactivated 1st Fleet to give the U.S. Navy more expeditionary
presence in the Indian Ocean are likely to get Biden’s support.
Singapore’s Changi and Australia’s Perth have been mooted
as possible bases for the fleet, which was restructured out
of existence in 1973, but security concerns are different
today. China’s People’s Liberation Army Navy (PLAN) is
growing. According to the Pentagon, it overtook the U.S.
Navy as the world’s largest in 2020, even commissioning
0
putting its own house in order first, leaving it with little moral to fill a tall order: counting
traction to pursue the cause of Hong Kong. on a network of resilience
with awkward partners, like
IMMUNIZATION | Vaccine diplomacy is fast Beijing and New Delhi, or combat troops
transforming Asia, where many countries that successfully Islamabad and Moscow, to in Afghanistan
controlled the virus last year have no clear path to keep Kabul stable.
immunization. As the U.S. vaccine campaign reaches saturation
levels, putting it in a position to export surplus shots, and as
China’s vaccines gain World Health Organization clearance,
the competition for influence is intensifying (Russia has
already jumped into the race, making it a three-way). There are
expectations, too. America’s delayed response in sending aid
and vaccines to India resulted in an immediate backlash from
the Quad partner, compounded by accusations of hoarding. But,
as the National Endowment for Democracy warns, authoritarian
states like China and Russia like to fight dirty, and there is ample
evidence of disinformation campaigns against Western vaccines,
targeting political elites of recipient countries for early access
and even securing political favors.

Biden: Will his Asia policy be driven by the Clinton-Obama school
of diplomacy, which has low tolerance for undemocratic foreign
powers, or will his be a more nuanced position that can work
with the authoritarianism common to the region? At a time when
China seeks to either replace or has already dethroned the U.S. as
the largest investor, market and/or partner in many Indo-Pacific
economies, Biden’s choices will matter more than ever.
its own indigenously produced aircraft carrier. The Defense
Department warns that the “PRC is seeking to establish a more
robust overseas logistics and basing infrastructure.” So, from
Myanmar to Pakistan, from Thailand to Sri Lanka, China has
naval ambitions. But will the Biden White House, which wants
to fight COVID-19 before it fights the PLAN, opt for further
military posturing?
Getty Images
JAKARTA | Indonesia is critical for Biden’s cause of
multilateralism: the largest country in the Association of
Southeast Asian Nations; the most populous Muslim nation
in the world; overseer of critical maritime passages; and
increasingly uncomfortable with China’s claims in the South Afghan Taliban fighters on the move in
China Sea. But there is a problem: The sentiment in Jakarta, Laghman Province, in March 2020.
and elsewhere in Southeast Asia, shows little confidence in

Nikkei Asia - Special excerpt from May 17-23, 2021 Print edition. Nikkei Inc. No reproduction without permission.
 THE BIG STORY

A container is loaded onto the Cosco

Wellington, the first containership to depart
after the inauguration of the China-Pakistan
Economic Corridor port in Gwadar,
Pakistan, in November 2016.
killed in brutally quelled
NORTH KOREA | protests. According to About

800
On its 101st day in office, observers, hundreds of
the Biden administration others -- mostly young
announced that it had concluded its men -- have disappeared,
North Korea policy review. Details were and thousands have been
people have
scant, but the shift in wording used by forced to flee their homes.
been killed
U.S. officials gave some clues to its internal But despite state-controlled
in Myanmar
discussions. Instead of calling for the “denuclearization of broadcasting, internet blockages
protests since
North Korea,” which the State Department had used for and social media shutdowns, a
Feb. 1
years, officials are now calling for the “denuclearization civil disobedience movement has
of the Korean Peninsula.” The nuanced change is a nod to remained resourceful and resilient.
South Korea, which has insisted on the new language as The parallel National Unity
it reduces finger-pointing toward the North. Crucially, the Government recently announced the formation of a people’s
adjustment suggests that the Biden administration is being defense force based on a rainbow of long-standing insurgent
true to its word in listening to allies and partners about armies. As the military began air assaults against the insurgents,
problem-solving in Pyongyang. one group recently claimed to have shot down a government

helicopter. Meanwhile, refugees are pushing up against the Thai
border following the airstrikes. The White House must weigh its
options as the possibility of a failed state looms large.
ORCHARD ROAD, SINGAPORE | In this finance-
savvy city-state, which punches above its political weight, this
address is where high street meets main street, and where China
could potentially meet the U.S. The tiny island’s nonpartisan
diplomacy -- its leader has openly said he does not want to
choose between Washington and Beijing -- is a microcosm of
Asia’s decoupling dilemma. The U.S. is a defense partner and
the biggest investor, but China is its largest export market. But
KCNA/Reuters
PORTS | Chinese strategists have long
worried about America’s hold over maritime
chokepoints like the Strait of Malacca. Thus,
the theory goes, China’s Belt and Road Initiative is built
on circumventing a potential denial of access through
a network of ports that either give it overland routes,
maritime presence, or even pipelines to energy and
trade networks. The theory appears to hold true so far,
from Kuantan in Malaysia to Kyaukpyu in Myanmar, to
Reuters
Hambantota in Sri Lanka, to Gwadar in Pakistan. But it
is not just the business of commercial ports that China is
getting into. Besides its military base in Djibouti, it has also
got a side business of birthing new cities around its port
projects: business parks, industrial zones, glitzy high-rises,
even airports. Biden must take note: The World Bank has
warned about the rising debt and instability that comes
with some of these projects, which could create greater
dependency on China.

with America knocking on Singapore’s door for naval basing

North Korea’s nuclear weapons program remains
a bargaining chip for leader Kim Jong Un.
LAOS | Even as it treads the thin red line
between old ally Vietnam and new benefactor
China, the tiny mountainous country is
transforming into Beijing’s satellite state. Laos presents a
rights (read First Fleet, above), either leader Lee Hsien Loong or
his successor may be forced to pick a side.
RAMA X | Thailand’s archaic lese-majeste
QUAD | Although not an alliance, the Quad seems to behave law has been used effectively to stifle dissent,
like one. But does the partnership between Australia, India, and protests have dwindled since last summer’s
Japan and the U.S. have the muscle to confront China militarily? peak. The protesters demanded the resignation of Prime
For that, the U.S. needs the Quad to include India, the world’s Minister Prayuth Chan-ocha’s government, but, more
second-largest military. For over two decades, the joint narrative radically, they broke an ancient taboo and openly called
for the India-U.S. relationship has remained compelling: The for reform of the monarchy under a revised constitution.
world’s oldest democracy must stand united with the world’s The demands are a direct challenge to the entrenched
largest one. Thanks to a robust defense partnership bolstered by interdependence between the military and monarchy -- the
the threat of China, the U.S. managed to convince traditionally former has traditionally justified its actions by claiming it

classic tale of what happens when Washington loses interest in
a country. Since Biden -- Jill, not Joe -- became the first White
House representative to visit the country in 2015, Laos’ debt to
China has doubled. As Beijing fires up the BRI, Laos is set to
become, according to China’s state-run Xinhua News Agency, “a
land bridge” that will connect China to the rest of the region.
MYANMAR | Since the military staged the Feb. 1 coup,
almost 800 people, including dozens of children, have been
Getty Images
nonaligned India to sign up. But three issues divide Washington
and New Delhi. Firstly, India’s decades-old habit of strategic
autonomy (translated, “my policy my way, your policy my
way”), which disqualifies it as dependable alliance material.
Next, its decades-old addiction to Russian military hardware,
which, short of a waiver, could trigger sanctions by the U.S.
Thirdly, its increasingly deteriorating human rights record
against minorities, dissidents and the press under the fervently
Hindu-nationalist and openly anti-Muslim Modi regime.
Thailand’s King Maha Vajiralongkorn waves to royalist
supporters during a ceremony to commemorate
the birthday of the late Thai King Bhumibol Adulyadej
at Sanam Luang in Bangkok in December.
is protecting the latter. However, the military is not going
anywhere. Thailand remains the United States’ oldest treaty
partner in Asia: an ally since 1954, which buys billions
worth of U.S. weaponry. As for King Maha Vajiralongkorn,
also referred to as Rama X, who remains at the center of the
current unrest, his proximity by decree and tradition to the
military reduces the possibility that Washington will directly
confront him.

Nikkei Asia - Special excerpt from May 17-23, 2021 Print edition. Nikkei Inc. No reproduction without permission.
 THE BIG STORY
SOUTH KOREA | Before the March
visit by the U.S. secretaries of state and
defense, the Moon administration had openly
distanced itself from Washington’s “free and open Indo-Pacific”
concept, wary of risking Beijing’s ire. But there is another, older
issue brewing: Japan. While Biden needs America’s two most
important allies in East Asia to be in lockstep, Seoul and Tokyo
cannot seem to stop kicking each other under the table, unable
to form trust due to historical issues. With a year left in his term,
President Moon Jae-in is also staring at a legacy problem, which
will stir instability in the trilateral arrangement if he pushes for
pan-peninsula denuclearization.
TAIWAN | Taipei’s status remains the primary source of
possible military confrontation between the U.S. and China.
While there was speculation that Biden might roll back
Trump’s tough-on-China policy, the first few days of the Biden
presidency, starting with his inauguration to which he invited
Taiwan’s representative, established that the new administration
was going to keep the pro-Taiwan momentum going. However,
if Taipei moves toward independence, Biden himself may be
the weakest link. He has shown no signs that he is ready to
change the long-standing U.S. stance of only recognizing Beijing
according to the “One China” policy.
UYGHURS | Biden’s election campaign took a very clear
stance on the “unspeakable oppression” of the Uyghurs of western
China’s Xinjiang. Upon his confirmation, Secretary Blinken retained
Trump’s categorization of Beijing’s treatment of the Muslim
minority as genocide. But will the Uyghurs become just another
item on a lengthening laundry list of anti-Beijing accusations, or
will the State Department actually come up with more tangible,
effective -- and perhaps punitive -- ways to deal with the issue?
VIETNAM | That Hanoi is taking full advantage of the U.S.-
China trade war (Apple is among the many companies that have
shifted production there) is not lost
upon either Washington or Beijing.
However, Hanoi needs more than
one great power to offset the other.
Vietnam’s
economy grew by
2.9%
Despite disagreement over the
Spratly Islands, Vietnam cannot
afford to push China away. Biden
will have to court hard, setting
in 2020
aside classic Democrat discomforts
-- one of the
about human rights for ties with
highest rates in
the communist state.
the world during
If he wants ASEAN to align with
the pandemic
the U.S., he will need to befriend
one of Southeast Asia’s most Source: IMF
dynamic economies.
WAGAH | Biden has probably never
heard of this small city in eastern Pakistan,
yet understanding its significance just might
bring peace to the world’s most dangerous nuclear
flashpoint. For decades, a half-hour before sunset, Indian
and Pakistani soldiers, hand-picked giants at a minimum
of 6 feet 4 inches and 200 pounds, have confronted each
other in full battle regalia for a changing of the guard
ceremony in this border town. Clicking heels, mustache
twirls and goose steps are all perfectly synchronized in
a choreographed daily show of machismo designed to
maintain order at the only official border crossing between
the two archrivals. Born together from the subcontinent’s
partition by the British, India and Pakistan are no longer
equals, except in their ability to annihilate each other with
an expanding nuclear arsenal. Biden must take stock: The
daily peacocking at Wagah is a sign of the possibilities
between India and Pakistan -- that they can, when they so
wish, actually make things work perfectly well.
Islamabad
Wagah
PAKISTAN
New Delhi
INDIA
AFP/Jiji
Pakistan Rangers, wearing black, and Indian Border
Security Force personnel take part in the daily
beating of the retreat in Wagah on Aug. 14, 2019.
YOSHIHIDE SUGA |
The departure of Shinzo Abe, Japan’s longest-
serving prime minister and architect of a crucial
international doctrine -- the “free and open Indo-Pacific”
-- has left a gap not just in Tokyo but also in Washington.
Here is the truth his successor Suga faces: Japan has one
ally in the world,
21 and that is the U.S. It has no military, just
the constitutionally nonaggressive Self-Defense Forces.
Thus, Japan’s security is almost totally dependent on a
treaty with America, based on the assumption that the U.S.
will always defend Japan. But while the political mood
in Tokyo is firmly pro-Washington, business elites want
to be on better terms with Beijing, and are not buying
into the decoupling narrative. After his recent visit to
the White House, where he openly condemned Beijing’s
expansionism, Suga -- whose poll numbers are suffering
for bungling the vaccination program and mismanaging
the Olympics -- seems like he is willing to take Tokyo to
the next level of Japan’s alliance with America, with clarity
about confronting China.
Uichiro Kasai
Japanese Prime Minister Yoshihide Suga:
firmly pro-Washington.
XI JINPING | China does not have a constitution, always the X-factor -- Biden and Xi have known each other for
but from school syllabuses to military manuals, “Xi more than a decade, a historic first for the top officeholders in
Jinping Thought’’ is already a part of the national Washington and Beijing, which could, potentially, hold out the
curriculum. Till he secures a third and probably indefinite term possibility of some warmth.
at the 20th National
Party Congress in 2022, ZTE [& HUAWEI] | The blandly named Zhongxing
Xi will not want to look Telecommunications Equipment Corp. is not just a maker
weak. But his long game Beijing celebrates of cheap cellphones. Along with Huawei Technologies, it is
the
100
is unlike Biden’s: Xi one of two Chinese companies that sells equipment for fifth-
is not trying to heal a generation cellular systems. That, according to trade skeptics
nation or groom a vice
president. Rather, he
th in Washington, makes them essential components of Beijing’s
foreign policy apparatus. The anti-Beijing narrative goes that
anniversary
is commemorating the China’s aid diplomacy programs push ZTE and Huawei
100th anniversary of of the founding of networks into infrastructure packages, embedding them into the
the Communist Party, the Chinese Communist tech economies of client states, giving Beijing eyes into another
with himself firmly Party this year country’s systems. Though no hard proof against Huawei has
in the center of the been made public, ZTE has owned up to and been fined for
Middle Kingdom. Thus, its own sanctions breaches during the Trump era, when both
themes like “secure and companies were designated national security threats. Under
controllable” (e.g., in chip supply chain resiliency) and “dual Biden, the screws continue to be tightened, sparking a major
circulation” (in developing domestic markets) will continue, as push for self-sufficiency by China’s semiconductor industry.
will zero tolerance for dissent -- just ask recently imprisoned If cybersecurity continues to feature in the U.S. versus China
Hong Kong newspaper publisher Jimmy Lai. But there’s rivalry, how far will it go?
Nikkei Asia - Special excerpt from May 17-23, 2021 Print edition. Nikkei Inc. No reproduction without permission.