Nima Khorrami – Written Evidence (ARC0002)

The future of multilateral governance in the Arctic region

There are a number of different angels from which one can discuss and speculate about the future of multilateral governance in the Arctic. One, for instance, could analyse this by focus on the potential role of different institutions including the EU, UN and the Arctic Council itself. One could also tackle this notion by zooming in on the potential role of non Arctic states, especially the Asian ones, and how their increased presence in the region could change the governance landscape in the region. This short brief does the latter.

The role of non-Arctic states as legitimate movers and shakers in Arctic regional affairs has been a hotly contested issue for some time. As global warming and technological innovation converge to make the region and its vast resources more accessible, countries like China, India, Japan and South Korea have all been attempting to exert more influence over the direction of Arctic governance. To this end, they have all sought to utilise their financial capacities and their contributions to the region’s infrastructural development as their preferred means for gaining political rights. Interestingly though, while the eight Arctic states have been receptive to these states capital, they have not displayed the same level of openness to their direct participation in decision making processes with regard to regional affairs. Instead, they have preferred to retain a high degree of exclusivity and limit the role of non-Arctic nations in policymaking processes.

To counter the Arctic eight’s insistence on exclusivity, almost all of the non-Arctic nations, albeit to varying degrees, have both highlighted their vulnerabilities to environmental changes in the Arctic and disseminated discourses that depict the region as a global common. As the war in Ukraine rages on and the Arctic Council continues to exclude Russia, efforts at widening the Arctic governance space are likely to gain further impetus not least because Moscow, the largest Arctic state, has already signalled a firm determination to be open to increased cooperation with China and India in pursuit of its regional developmental goals

India’s Interests in the Arctic

India’s approach towards the Arctic has taken an unmissable geopolitical turn since late 2017, when it abandoned its largely science-only approach and adopted a more well-rounded view on the region. Like China, India is keen on utilising the commercial benefits of a shorter maritime route via the Northern Sea Route and feed its economy with the Arctic oil and gas as it seeks to diversify its supply routes. Such intents were on clear display during the fifth Eastern Economic Forum in Vladivostok in 2019 when Moscow “invited” India to participate in its Arctic projects while India’s then Minister of Petroleum and Natural Gas, Dharmendra Pradhan, expressed his country’s interest in becoming an “energy bridge” with Russia

New Delhi’s Arctic engagement is also motivated by its desire to secure Russian commitment to the completion of an extended version of the North South Transport Corridor (INSTC) that would be used, upon completion, to transport Arctic resources to India. North South Corridor itself matters a great deal to India because it enables New Delhi to provide an alternative to Beijing’s Belt and Road initiative more efficiently. Doing so, put briefly, is motivated by both strategic and status/prestige competition between the two Asian giants.

Thirdly, India’s involvement in the Arctic is closely linked to its concerns with regard to China’s increased Arctic presence which could, so the reasoning goes, distract the United States from the Indo-Pacific region. More importantly, Indian strategists and decision makers worry that the Arctic’s emerging maritime routes would, in the long run, offer Beijing a viable alternative to the Malacca Strait thereby mitigating what is commonly referred to as Beijing’s Malacca dilemma. Constituting a cornerstone of New Delhi’s strategy in a potential conflict with China is the plan to cut off “Chinese shipping supplies through the Indian Ocean”, and thus Indian strategists worry that Beijing’s access to Arctic routes would simply render that strategy ineffective. Also at play is India’s desire to prevent the emergence of a strong Sino-Russo partnership in the Arctic and beyond. For India, Russia’s close ties with China is both a concern and a major asset that must be managed carefully so it could rely on Moscow as a trusted mediator in order to manage its own competition with Beijing.

China’s interests

Arguably, no other country benefits more from the current confrontation between Russia and the West than China. China now has the opportunity to increase its power over Russia, thereby reaffirming its status as the superior party in the context of its bilateral relationship. In fact, the more isolated Russia becomes, the more reliant it will be on China. Thanks to Western sanctions, for instance, Russia is ever more dependent on China as a financial investor and, perhaps more interestingly, a supplier of strategic civilian technology including, but not limited to, 5G systems. Moreover, China is already Russia’s largest foreign partner in the Arctic in regards to energy and in the aftermath of the war in Ukraine this collaboration can only grow. Notwithstanding its awareness of Russia’s past opposition to Chinese presence in the Arctic, Beijing reaps a strategic advantage in increased Russian isolation as it brings Moscow closer to its orbit, increases Chinese bargaining power when demanding price discounts, and enables China to further diversify its trade routes and energy supplies

Current situation

After an initial pause, the Arctic Council has now resumed its activities without Moscow. As Western sanctions cut Moscow off from the global market, Russia will likely be inclined to work more with non-Arctic states, especially China and India but also the likes of Saudi Arabia and the UAE which have the financial means to bankroll Moscow’s priority projects in the Arctic. A joint initiative in the Arctic from China, India and Russia is even more probable due to their shared strategic interests in the region’s vast resources. More importantly, the three states represent what some label as grieved civilizational powers. As such, their cooperation could be facilitated by their shared frustration with what they consider a Western double standard in imposing sanctions and the West’s selective adherence to international law; a grievance that explains why both China and India have so far refused to outright condemn the invasion of Ukraine.

Given the above, efforts at keeping Russia out of the Arctic Council and/or the establishment of an alternative to it could prompt Moscow to respond by establishing an alternative regional governing body with Beijing and New Delhi. Such a move could polarise regional governance and hinder effective decision making on region-wide issues, squeeze the Arctic’s smaller states—Denmark, Finland, Norway, Iceland, and Sweden—out of decision-making processes, and expose the region to the dynamics of Chinese-Indian and Chinese-American power rivalries.

Policy recommendation

To avert such situation, the best-case scenario would be to display a high degree of pragmatism and resume the working of the Arctic Council with the full participation of the A8. However, this is likely not a viable option due to the low trust between Russia and the West, and because it could heighten sensitivities amongst Eastern European nations. It could also prove unpopular with the electorates in the Western Arctic nations and undermine current efforts at delegitimising Moscow on the world stage by providing it with a degree of legitimacy. Seeing the lack of good alternatives to choose from, the focus ought to be on the least disadvantageous course of action.

One such possibility lies in the form of preemption: isolating the Kremlin by preempting its outreach to Asia and incentivising Asian states to work with the Western members of the Arctic Council while simultaneously warning them of severe sanctions should they continue to pour money into Russia’s Arctic projects. To this end, the recently held Second India Nordic Summit, during which Arctic cooperation was discussed, represents an important step in the right direction. Still, doing so involves hard strategic tradeoffs as it would require the Arctic states to give up on the notion of exclusivity and dial down on their strategic competition with Beijing and New Delhi. This course of action offers a way forward with less Russian influence in the Arctic but it does not prevent the expected rise in Asian, and more broadly, non-regional actors’ influence in the Arctic.

17 April 2023