Page 5 - AsianOil Week 36

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landlocked Nepal was hit by a blockade orches- trated by the ethnic Madhesis in the south of the country in 2015. The Kathmandu government accused India of unofficially supporting the blockade, which New Delhi denied.
This paved the way for Sino-Nepal talks to begin over a fuel supply deal, though this ulti- mately never came to fruition. While India has succeeded in restoring ties with Nepal, tying the economy even more to Indian petroleum supplies, the South Asian giant is struggling to combat China’s multipronged approach further from home.
On two fronts
India has been trying to establish a presence in the South China Sea amid growing tensions between China and Vietnam and the Philippines over Beijing’s maritime claims.
OVL, the overseas arm of state-run Oil and Natural Gas Corp. (ONGC), has reportedly applied for a sixth extension to its exploration licence for Vietnam’s deepwater Block 128. While the company has held the block for several years with no exploration success, the acreage is of strategic value to the Indian government.
Part of Block 128 lies within China’s nine- dash line claim to the South China Sea, which encompasses more than 90% of the sea. Beijing has in the past warned OVL that its exploration activities off Vietnam’s coast are illegal.
In July, a Chinese Coast Guard vessel report- edly manoeuvred in a “threatening manner” towards Vietnamese vessels in Block 06.1, in which OVL owns a 45% stake.
But even as the Chinese government ramps up its aggressive posturing towards Vietnam, its softer approach in the Philippines is slowly win- ning over a key regional opponent.
Philippine President Rodrigo Duterte has said his government is willing to ignore the Per- manent Court of Arbitration’s (PAC) ruling in 2016 that dismissed much of China’s claim to the South China Sea in order to proceed with joint exploration of contested waters.
Beijing has refused to recognise that ruling, and has instead been ramping up its militari- sation of the region and setting up missile-pro- tected bases on disputed reefs.
“The exclusive economic zone is part of the arbitral ruling which we will ignore to come up with an economic activity,” Duterte told report- ers on September 10 when asked whether joint exploration would even cover waters that China does not claim.
But it is not just in the South China Sea that Beijing is proving adept at expanding its influ- ence, with efforts in Pakistan and Iran also leav- ing India on the back foot.
Unimpressed
Iran last week complained that India’s develop- ment of the port of Chabahar was slower than that of Chinese companies at work on Pakistan’s port of Gwadar.
China is developing Gwadar as part of the China-Pakistan Economic Corridor (CPEC), which itself is a major component of the Belt and Road Initiative (BRI). Along with the eco- nomic benefits that Gwadar offers, the port can also serve as a naval base in the Indo-Pa- cific region.
Nearby Chabahar is supposed to act as a counter to this, though the pace of development suggests Indian commitment to Iranian projects is less than Tehran desires. The Iranian govern- ment has made this point, suggesting New Delhi is missing out on opportunities that Chinese investors are pouncing on.
India dreams of being a regional power to challenge China’s influence, but does not appear to have the same ambition or drive to turn that vision into a reality. While New Delhi may have succeeded in stymying Chinese interests in Nepal with a $45mn pipeline, Nepal is a small piece in a much larger game that Beijing appears to be winning.™
Week 36 11•September•2019 w w w . N E W S B A S E . c o m P5