Hambantota Harbour and an Exile’s Return (Part Two)

By: Nuwan Peiris

The “H’ factor – The New Pearl

Titled "Energy Futures in Asia" by Booz Allen Hamilton (defense contractor) for the Pentagon in an “internal report” mentions about the "pearls" in a string. These pearls could be seen in Chinese naval presence. It starts from Gwadar in Pakistan, at Chittagong in Bangladesh, in Myanmar, Cambodia and Thailand, pulling to South China Sea. Add to all this, “Hambantota” – the “H” factor – the new pearl in the necklace – which is “Made in China”.

Dubbed as Burma Rama – B. Raman – a RAW officer, in an excellent write-up, in “Gwadar, Hambantota & Sitwe: China's Strategic Triangle”, relates how “H” factor forms a strategic triangle checkmating India. First take Deep Sea Hub Port developed by China in Gwadar in Pakistan. Gwadar is just 72km from the Iranian border and 400 km east of the Strait of Hormuz, a major channel of world oil supplies.

This would serve as a western outlet for Chinese exports and energy supplies. Thus it would reduce the dependence on choke points like Malacca Straits vulnerable to disruptions and pirate attacks. Oil/gas tankers to China from the Gulf and Africa could be discharged in Gwadar, then pumped by a pipeline through Kashmiri territory to Xinjiang. Pakistan further agreed with China to set up a Special Economic Zone (SEZ) in Gwadar. This Zone is entirely for Chinese use to produce goods for export in Africa. The cost advantage is immense.

The political and economic apron of China would be nicely laid to reach Gulf and Africa. Further, tank farms in Gwadar would be a vantage for Chinese Navy. As B. Raman points out;

“The Chinese interest in Gwadar is not just economic and energy supplies related. It is much, much more. It is of immense interest to its Navy---as a port of call, as a refuelling halt and as a listening and watch tower to monitor developments in the Gulf---particularly the movements of the US Navy.”

The other point in the triangle is Sitwe in Myanmar. China mainly intends to lay pipelines to Yunnan – province in the far southwestern corner of China – from Sitwe. The third point is Hambantota in the strategic triangle. This means in the game of China Vs India played in Sri Lankan grass – it is now “advantage China”.

Compromising Energy Security

Perhaps impending consequences of the Indian blunder is not military – at least in short term. It is the energy security that is compromised. As we are aware, “energy security dynamics” is relatively a new field in this region, especially big nations invest large political capital to gain strides. India grows at over 8% of the GDP and consumption accounts for 60% of GDP and consumes nearly 3% of the world's total energy. And this consumption is expected to double in the next 15 years. Yet India has only invested a sum less than US$ 4 billion in the energy sector as opposed to China where their total investment accounts for US$ 40 billion.

West's energy watchdog “International Energy Agency” said in a recent monthly Oil Market Report that India's oil demand in 2007 is expected to rise by 3.4 per cent from last year to 2.7 million barrels per day. Given the seriousness of this, India could never compromise on energy security. In April 2007 Indian Planning Commission Deputy Chairman Montek Singh Ahluwalia said in Tokyo that the demand for energy is expected to grow, but would grow below the rate of economic growth due to increased energy efficiency. Still, India could not afford to ignore the energy resources scattered within the vast Indian Ocean basin.

Being conscious of the above challenges that laid ahead, Indian legislature realized the importance of a strong national policy on energy. This gave birth to government’s 2000 proposals of Hydrocarbon Vision 2025. This serves as a blueprint for Indian petrochemical businesses. State-owned companies like the Oil and Natural Gas Corporation (ONGC) and Oil India Limited (OIL) which explores and exploit, and the Indian Oil Corporation (IOC), which secures oil from abroad, would to shape the direction of energy national policy under the Ministry of Petroleum and Natural Gas through the Directorate General of Hydrocarbons (DGH) and the Oil Coordination Committee. Knowing that, 50% of the Indian Ocean basin lies within a 1,000 mile radius of India, the challenges that lie ahead for India are vast.

The commercial challenges that India face in the entire Ocean Continent would be determined by the presence of other superpowers in neighbouring countries located in the Indian Ocean. For now, Chinese presence in Hambantota has altered the Sri Lankan geopolitical equation; and the writer notes the following spillover effects on Sri Lankan policies;

1. Sri Lankan government would not hesitate to cooperate more with China in Off-shore oil exploration, thinking less of India: – This is already seen in Mannar basin adjoining Indian Cauvery basin where China, like India, was offered an oil block for exploration without bidding.

2. Dual presence of “China and India” would give leverage to the Sri Lankan government to bring other energy explorers to the shore without being intimidated by India (perhaps for a better deal!): – The opening of 6 oil drilling blocks for competitive bidding in Mannar is a case in point. Sri Lanka could now afford to send delegations to Washington, London, Dubai or Singapore for bidding invitations. This promotes the Indian Ocean to be truly international waters open to the world.

3. The possibility of internationalizing domestic issues like LTTE, in the long term (like Nigeria), which could affect the Dravidian sensitivities of South India. One writer said (referring to US in Mannar oil exploration); “It will be very hard for US Texaco to make progress in Tamil Eelam sea without removing LTTE from U.S banned list; directly or indirectly they have to deal with LTTE than GOSL for positive outcome!”

5. Unfolding Geopolitical Drama

Geo-strategically, Indian responses to Sri Lankan issues have been impulsive and erratic. Resultantly, loosing the Lankan geo-political grip means they have allowed China to creep into the Indian security perimeter – and it is right to say they are inside India. Indian Experts said, time and over, that the Indian security perimeter extends from the Strait of Hormuz to the Strait of Malacca, from Africa's east coast to the western shores of Australia. India may implement the setting up of a high-tech monitoring post in northern Madagascar under the cover of combating piracy/terrorism. Else markedly increase the aerial superiority in their scientific base in Antarctica. But yet it is undeniable that China and Diego Garcia of US has already come under her wingspan.

But now one thing is clear – and that’s for sure. Writer believes that Indians are still stuck with the classical naval doctrine of K.M Panikkar, the architect of India's naval doctrine. Modern brown-water naval strategy (naval expansion in their own ocean), leave aside blue-water (trans-oceanic naval expansion), means that it not a bareboat naval expansion (like in Panikkar’s days) but an apron cover of aerial, communication, and logistical forward-press. Quintessentially, regional aerial dominance is vital, as the naval crafts in battle could be “sitting ducks”, if aerial protection is lacking. Seeing that Weeravilla Airport which is few miles from Hambantota, the dragon needs only one step to move close!

At time of writing, IOC is further proposing US$ 20 million investment in the aviation fuel market by 2008. But should they stop from that? Sources state that IOC is also looking to open up the East in a positive manner. (Do not forget the above-mentioned Weeravilla Airport).

From ACSA to Texaco – you name it – all this is added weight to Indian geopolitical paraphernalia.

For the moment, the ONGC wants to explore petroleum reserves in the Palk Straits i.e. the Sethusamudram. Yet on Sri Lankan side the involvement of Norwegians through TGS-NOPEC to collect 2D seismic data, starting from the east coast of Sri Lanka, could not be lightly presumed, perhaps with a 3D eye on petroleum prospects. Certainly the involvement of this Norwegian company has raised eyebrows of some in Colombo. Perhaps given the possibilities of energy exploration in the Sri Lankan ocean basin - and Mannar plus Weeravilla-Air factor – it is a wise move for China to have come through the backdoor – Hambantota.

How would India take all this? For India, geopolitical equation in Sri Lanka is getting complex – and the “H” factor is another added variable. With UAE sensing for an oil refinery in Hambantota, Sri Lanka is fast becoming a feeding plate for too many.

Cometh the hour, cometh the dragon. Only time would tell what the final episodes of an unfolding geopolitical drama. Let the writer leave the reader with few words of Chinese wisdom.

“When opponents present openings, you should penetrate them immediately. Get to what they want first, subtly anticipate them. Maintain discipline and adapt to the enemy in order to determine the outcome of the war. Thus, at first you are like a maiden, so the enemy opens his door, then you are like a rabbit on the loose, so the enemy cannot keep you out.”- Art of War - Sun Tzu.

(Writer is a Sri Lankan. He is also an Attorney, a Research Analyst, and a Freelance Journalist. The views expressed by the author are his own. For comments on this article write to nuwan20044@yahoo.com)