Pic By BLOOMBERG
EVERY September, I have been relentlessly bombarding my readers with writings about the annual Eastern Economic Forum in Vladivostok, Russia. Finally, we witnessed the attendance of prime minister of Malaysia. We listened to his advice to Russia on how to develop the Far East region. What more could a writer wish for?
Well, he may wish to give his readers a little bit of a regional background to Tun Dr Mahathir Mohamad’s negotiations with the Russian President Vladimir Putin and the rest of events in Vladivostok. Very big things are brewing in Asia. And Vladivostok happened to be the venue where these big things were finally revealed. The big things boiled down to the future of the two giants — China and India. And then, there are the rest of the Eastern nations. And there is that Russian desire to turn our Far East into an Asian miracle, profiting from all the criss-crossing interests in the area.
India was, officially, the main guest at the forum. Unofficially, it was confirmed that the Indian attendance in Vladivostok meant the biggest ever trading delegation sent by Delhi to any country. It was headed by Prime Minister Narendra Modi.
Initially it was unclear about India’s interests this time. But gradually, it started to make sense. We are talking about the nation’s strategic decision to connect its future with Russia’s oil and gas (O&G).
The director of the National Energy Security Fund Konstantin Simonov reminded us that almost all of Russia’s hydrocarbons in Siberia had been “contracted” by China, be it pipelines crossing the Russo-Chinese border or liquefied natural gas (LNG) from the new fields in the Arctic.
China decided long ago that if you wanted to get Russian O&G, and continue getting them for decades to come, you better become a co-owner of (in this case an “investor”) in several new projects.
But India has virtually the same problems like China — it’s China’s “energy twin brother”, said Simonov.
The population of both nations are well above one billion people (soon to reach 1.5 billion), and India’s economy is following China’s footsteps.
India has added 55 million tonnes of oil to its annual consumption in only five years. But its gas consumption growth had been sluggish. Meanwhile, China had doubled its gas consumption in seven years, using now almost 300 billion cu m of gas annually.
India wanted its share of gas to reach 15% before 2022. It simply means that India will have to use 200 billion cu m of gas annually from the current level.
We could summarise that India’s acceptance, like China, has to tie its future to O&G of Siberia and Russian Arctic for decades to come. That was the analysis by numerous experts in Vladivostok and Russia in general.
Modi’s visit only confirmed that verdict. It fitted whether a long-term contract with the Russian Novatek Corp (the one that delivers LNG from the Arctic fields to China), or Modi’s visit to the wharf making superpowerful icebreakers.
If you trust a nation with your economy’s future, you must also trust the former’s military prowess. India will receive the S-400 missiles in 18-19 months’ time. S-400 is probably the best anti-missile system in the world, shooting down anything that flies below 30km at a distance of about 400km.
It is a significant addition to the military helicopters, ships, rifles and etc that India is getting from Russia or produces jointly with Russia in India.
The purchase of the S-400 signifies a nation’s independence from the US or any other country. Turkey, a member of NATO alliance, has confirmed the acquisition of the S-400 despite the threats of sanctions. India has endured pressures from the same quarters. China is already using the system.
The Vladivostok forum is a five year-old gathering at the height of Russia’s quarrel with the West.
Its task was to find investors to the Russian Far East, a huge area with only about 16 million people. These annual gatherings are also about long-term trends related to economic development in Asia. Asians have to be on guard of these trends. You cannot untie the Far East’s development from what happens around all the regions.
Dmitry Kosyrev is an author of 8 novels and a book of short stories, as well as a columnist for 2 Moscow publications. Orientalist by education (Moscow University), he has a special love for Malaysia.