The World Is Dedollarizing

Global Research, July 19, 2019

What if tomorrow nobody but the United States would use the US-dollar? Every country, or society would use their own currency for internal and international trade, their own economy-based, non-fiat currency. It could be traditional currencies or new government controlled crypto-currencies, but a country’s own sovereign money. No longer the US-dollar. No longer the dollar’s foster child, the Euro. No longer international monetary transactions controlled by US banks and – by the US-dollar controlled international transfer system, SWIFT, the system that allows and facilitates US financial and economic sanctions of all kinds – confiscation of foreign funds, stopping trades between countries, blackmailing ‘unwilling’ nations into submission. What would happen? – Well, the short answer is that we would certainly be a step close to world peace, away from US (financial) hegemony, towards nation states’ sovereignty, towards a world geopolitical structure of more equality.

We are not there yet. But graffities are all over the walls signaling that we are moving quite rapidly in that direction. And Trump knows it and his handlers know it – which is why the onslaught of financial crime – sanctions – trade wars – foreign assets and reserves confiscations, or outright theft – all in the name of “Make America Great Again”, is accelerating exponentially and with impunity. What is surprising is that the Anglo-Saxon hegemons do not seem to understand that all the threats, sanctions, trade barriers, are provoking the contrary to what should contribute to American Greatness. Economic sanctions, in whatever form, are effective only as long as the world uses the US dollar for trading and as reserve currency.

Once the world gets sick and tired of the grotesque dictate of Washington and the sanction schemes for those who do no longer want to go along with the oppressive rules of the US, they will be eager to jump on another boat, or boats – abandoning the dollar and valuing their own currencies. Meaning trading with each other in their own currencies – and that outside of the US banking system which so far even controls trading in local currencies, as long as funds have to be transferred from one nation to another via SWIFT.

Many countries have also realized that the dollar is increasingly serving to manipulate the value of their economy. The US-dollar, a fiat currency, by its sheer money mass, may bend national economies up or down, depending in which direction the country is favored by the hegemon. Let’s put the absurdity of this phenomenon in perspective.

Today, the dollar is based not even on hot air and is worth less than the paper it is printed on. The US GDP is US$ 21.1 trillion in 2019 (World Bank estimate), with current debt of 22.0 trillion, or about 105% of GDP. The world GDP is projected for 2019 at US$ 88.1 trillion (World Bank). According to Forbes, about US$ 210 trillion are “unfunded liabilities” (net present value of future projected but unfunded obligations (75 years), mainly social security, Medicaid and accumulated interest on debt), a figure about 10 times the US GDP, or two and a half times the world’s economic output.

This figure keeps growing, as interest on debt is compounded, forming part of what would be called in business terms ‘debt service’ (interest and debt amortization), but is never ‘paid back’. In addition, there are about one to two quadrillion dollars (nobody knows the exact amount) of so-called derivatives floating around the globe. Aderivative is a financial instrument which creates its value from the speculative difference of underlying assets, most commonly derived from such inter-banking and stock exchange oddities, like ‘futures’, ‘options’, ‘forwards’ and ‘swaps’.

This monstrous debt is partly owned in the form of treasury bonds as foreign exchange reserves by countries around the world. The bulk of it is owed by the US to itself – with no plans to ever “pay it back” – but rather create more money, more debt, with which to pay for the non-stop wars, weapon manufacturing and lie-propaganda to keep the populace quiet and in lockstep.

This amounts to a humongous worldwide dollar-based pyramid system. Imagine, this debt comes crashing down, for example because one or several big (Wall Street) banks are on the brink of bankruptcy, so, they claim their outstanding derivatives, paper gold (another banking absurdity) and other debt from smaller banks. It would generate a chain reaction that might bring down the whole dollar-dependent world economy. It would create an exponential “Lehman Brothers 2008” on global scale.

The world is increasingly aware of this real threat, an economy built on a house of cards – and countries want to get out of the trap, out of the fangs of the US-dollar. It’s not easy with all the dollar-denominated reserves and assets invested abroad, all over the globe. A solution may be gradually divesting them (US-dollar liquidity and investments) and moving into non-dollar dependent currencies, like the Chinese Yuan and the Russian Ruble, or a basket of eastern currencies that are delinked from the dollar and its international payment scheme, the SWIFT system. Beware of the Euro, it’s the foster child of the US-dollar!

There are increasingly blockchain technology alternatives available. China, Russia, Iran and Venezuela are already experimenting with government-controlled cryptocurrencies to build new payment and transfer systems outside the US-dollar domain to circumvent sanctions. India may or may not join this club – whenever the Modi Government decides which way to bend – east or west. The logic would suggest that India orients herself to the east, as India is a significant part of the huge Eurasian economic market and landmass.

India is already an active member of the Shanghai Cooperation Organization (SCO) – an association of countries that are developing peaceful strategies for trade, monetary security and defense, comprising China, Russia, India, Pakistan, most Central Asian countries and with Iran waiting in the wings to become a full-fledged member. As such, SCO accounts for about half of the world population and a third of the world’s economic output. The east has no need for the west to survive. No wonder that western media hardly mention the SCO which means that the western average public at large has no clue what the SCO stands for, and who are its members.

Government-controlled and regulated blockchain technology may become key to counter US coercive financial power and to resist sanctions. Any country is welcome to join this new alliance of countries and new but fast-growing approach to alternative trading – and to finding back to national political and financial sovereignty.

In the same vein of dedollarization are Indian “barter banks”. They are, for example, trading Indian tea for Iranian oil. Such arrangements for goods to be exchanged against Iranian petrol are carried out through Indian “barter banks”, where currencies, i.e. Iranian rials and Indian rupees, are handled by the same bank. Exchange of goods is based on a list of highest monetary volume Indian trade items, against Iranian hydrocarbon products, for example, Iran’s large import of Indian tea. No monetary transaction takes place outside of India, therefore, US sanctions may be circumvented, since no US bank or US Treasury interference can stop the bilateral trade activities.

At this point, it might be appropriate to mention Facebook’s attempt to introduce a globe-spanning cryptocurrency, the Lira. Little is known on how exactly it will (or may) function, except that it would cater to billions of facebook members around the world. According to Facebook, there are 2.38 billion active members. Imagine, if only two thirds – about 1.6 billion – opened a Libra account with Facebook, the floodgate of libras around the world would be open. Libra is or would be a privately-owned cryptocurrency – and – coming from Facebook – could be destined to replace the dollar by the same people who are now abusing the world with the US-dollar. It may be projected as the antidote to government-controlled cryptocurrencies, thus, circumventing the impact of dedollarization. Beware of the Libra!

Despite US and EU sanctions, German investments in Russia are breaking a 10-year record in 2019, by German business pouring more than €1.7 billion into the Russian economy in the first three months of 2019. According to the Russian-German Chamber of Commerce, the volume of German companies’ investments in Russia is up by 33% – by € 400 million – since last year, when total investments reached € 3.2 billion, the largest since 2008. Despite sanctions which amounted to about € 1 billion combined for 140 German companies surveyed and registered with the Chamber of Commerce, and despite western anti-Russia pressure, Russia-German trade has increased by 8.4 percent and reached nearly € 62 billion in 2018.

In addition, notwithstanding US protests and threats with sanctions, Moscow and Berlin continue their Nord Stream 2 natural gas pipeline project which is expected to be finished before the end of 2019. Not only is the proximity of Russian gas a natural and logical supply source for Germany and Europe, it will also bring Europe independence form the bullying sales methods of the United States. And payments will not be made in US dollars. In the long-run, the benefits of German-Russian business and economic relations will far outweigh the illegal US sanctions. Once this awareness has sunk in, there is nothing to stop Russian-German business associations to flourish, and to attract other EU-Russian business relations – all outside of the dollar-dominated banking and transfer system.

President Trump’s trade war with China will eventually also have a dedollarization effect, as China will seek – and already has acquired – other trading partners, mostly Asian, Asian-Pacific and European – with whom China will deal in other than dollar-denominated contracts and outside the SWIFT transfer system, for example using the Chinese International Payment System (CIPS) which, by the way, is open for international trade by any country across the globe.

This will not only circumvent punishing tariffs on China’s exports (and make US customers of Chinese goods furious, as their Chinese merchandise is no longer available at affordable prices, or no longer available at all), but this strategy will also enhance the Chinese Yuan on international markets and boost the Yuan even further as a reliable reserve currency – ever outranking the US-dollar. In fact, in the last 20 years, dollar-denominated assets in international reserve coffers have declined from more than 90% to below 60% and will rapidly decline further as Washington’s coercive financial policies prevail. Dollar reserves are rapidly replaced by reserves in Yuan and gold, and that even in such staunch supporters of the west as is Australia.

Washington also has launched a counter-productive financial war against Turkey, because Turkey is associating and creating friendly relations with Russia, Iran and China – and, foremost, because Turkey, a NATO stronghold, is purchasing the Russian S-400 cutting-edge air defense system – a new military alliance which the US cannot accept. As a result, the US is sabotaging the Turkish currency, the Lira which has lost 40% since January 2018.

Turkey will certainly do whatever it can to get out from under the boot of the US-dollar stranglehold and currency sanctions – and further ally itself with the East. This amounts to a double loss for the US. Turkey will most likely abandon all trading in US dollars and align her currency with, for example, the Chinese Yuan and the Russian ruble, and, to the detriment of the Atlantic alliance, Turkey may very likely exit NATO. Abandoning NATO will be a major disaster for the US, as Turkey is both strategically, as well as in terms of NATO military power one of the strongest – if not the strongest – nation of the 29 NATO members, outside of the US.

If Turkey exits NATO, the entire European NATO alliance will be shaken and questioned. Other countries, long wary of NATO and of storing NATO’s nuclear weapons on their soils, especially Italy and Germany, may also consider exiting NATO. In both Germany and Italy, a majority of the people is against NATO and especially against the Pentagon waging wars form their NATO bases in their territories in Germany in Italy.

To stem against this trend, the former German Defense Minister, Ursula von der Leyen, from the conservative German CDU party, is being groomed to become Jean-Claude Juncker’s successor as President of the European Commission. Mr. Juncker served since 2014. Ms. Von der Leyen was voted in tonight, 17 July, with a narrow margin of 9 votes. She is a staunch supporter of NATO. Her role is to keep NATO as an integral part of the EU. In fact, as it stands today, NATO is running the EU. This may change, once people stand up against NATO, against the US vassal, the EU Administration in Brussels, and claim their democratic rights as citizens of their nation states.

Europeans sense that these Pentagon initiated and ongoing wars and conflicts, supported by Washington’s European puppet allies, may escalate into a nuclear war, their countries’ NATO bases will be the first ones to be targeted, sinking Europe for the 3rdtime in 100 year into a world war. However, this one may be all-destructive nuclear – and nobody knows or is able to predict the damage and destruction of such a catastrophe, nor the time of recovery of Mother Earth from an atomic calamity.

So, let’s hope Turkey exits NATO. It would be giant step towards peace and a healthy answer to Washington’s blackmail and sabotage against Turkey’s currency. The US currency sanctions are, in the long run, a blessing. It gives Turkey a good argument to abandon the US dollar and gradually shift towards association with eastern moneys, mainly the Chinese Yuan, thereby putting another nail in the US-dollar’s coffin.

However, the hardest blow for Washington will be when Turkey exits NATO. Such a move will come sooner or later, notwithstanding Ms. Von der Leyen’s battle cries for NATO. The breaking up of NATO will annihilate the western power structure in Europe and throughout the world, where the US still maintains more than 800 military bases. On the other hand, the disbanding of NATO will increase the world’s security, especially in Europe – for all the consequences such an exit will bear. Exiting NATO and economically exiting the US-dollar orbit is a further step towards dedollarization, and a blow to US financial and military hegemony.

Finally, investments of the Chinese Belt and Road Initiative (BRI), also called the New Silk Road, will be mostly made in Yuan and local currencies of the countries involved and incorporated in one or more of the several BRI land and maritime routes that eventually will span the globe. Some US-dollar investments may serve the People’s Bank of China, China’s Central Bank, as a dollar-divesting tool of China’s huge dollar reserves which currently stands at close to two trillion dollars.

The BRI promises to become the next economic revolution, a non-dollar economic development scheme, over the coming decades, maybe century, connecting peoples and countries – cultures, research and teaching without, however, forcing uniformity, but promoting cultural diversity and human equality – and all of it outside the dollar dynasty, breaking the nefarious dollar hegemony.

*

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This article was originally published on New Eastern Outlook.

Peter Koenig is an economist and geopolitical analyst. He is also a water resources and environmental specialist. He worked for over 30 years with the World Bank and the World Health Organization around the world in the fields of environment and water. He lectures at universities in the US, Europe and South America. He writes regularly for Global Research; ICH; RT; Sputnik; PressTV; The 21st Century; TeleSUR; The Saker Blog, the New Eastern Outlook (NEO); and other internet sites. He is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed – fiction based on facts and on 30 years of World Bank experience around the globe. He is also a co-author of The World Order and Revolution! – Essays from the Resistance. He is a Research Associate of the Centre for Research on Globalization.

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Shifting Alliances: Is Turkey Now “Officially” an Ally of Russia? Acquires Russia’s S-400. Exit from NATO Imminent?

Global Research, July 13, 2019

Turkey is taking delivery of Russia’s S 400 missile defence system. What this signifies is that Turkey and Russia are now “officially” allies. The first shipment of the S-400 landed in Ankara on July 12, according to Turkey’s Ministry of Defense. (see image below)

Two more shipments are due, with the third delivery of “over 120 anti-aircraft missiles of various types… [scheduled] tentatively at the end of the summer, by sea.” 

Reports confirm that the “Turkish S-400 operators will travel to Russia for training in July and August. About 20 Turkish servicemen underwent training at a Russian training center in May and June, …”(CNN, July 12, 2019)

How will the US respond?

In all likelihood, Erdogan’s presidency will be the object of an attempted regime change, not to mention ongoing financial reprisals directed against the Turkish Lira as well as economic sanctions. 

Bloomberg screenshot

What is unfolding is an all out crisis in the structure of military alliances. Turkey cannot reasonably retain its NATO membership while at the same time entering into a military cooperation agreement with the Russian Federation. 

Reminiscent of World War I, shifting alliances and the structure of military coalitions are crucial determinants of history.

Today’s military alliances, including “cross-cutting coalitions” between “Great Powers” are markedly different and exceedingly more complex than those pertaining to World War I. (i.e  the confrontation between “The Triple Entente” and “the Triple Alliance”).

Turkey’s de facto exit from NATO points to a historical shift in the structure of military alliances which could potentially contribute to weakening US hegemony in the Middle East as well as creating conditions which could lead to a breakup of the North Atlantic Treaty Organization (NATO).

NATO constitutes a formidable military force composed of 29 member states, which is largely controlled by the Pentagon. It is a military coalition and an instrument of modern warfare. It constitutes a threat to global security and World peace. 

Divisions within the Atlantic Alliance could take the form of one or more member states deciding to “Exit NATO”. Inevitably an NATO-Exit movement would weaken the unfolding consensus imposed by our governments which at the this juncture in our history consists in threatening to wage a pre-emptive war against Iran and the Russian Federation.  

Sleeping with the Enemy

While Turkey is still “officially” a member of NATO, president Recep Tayyip Erdoğan (right) has for the last two years been developing “friendly relations” with two of America’s staunchest enemies, namely Iran and Russia.

US-Turkey military cooperation (including US air force bases in Turkey) dates back to the Cold War.

Turkey by a long shot has the largest conventional forces (after the US) within NATO outpacing France, Britain and Germany,

#NATOExit

Broadly speaking, the US-Turkey rift and its implications for the Atlantic Alliance have sofar been ignored or trivialized by the media.

NATO is potentially in a shambles. The delivery of the S-400 almost a year ahead of schedule will contribute to further destabilising the structure of  military alliances to the detriment of Washington.

Turkey is also an ally of Iran. Inevitably, Turkey’s possession of the S-400 will affect ongoing US war plans directed against Iran (which will also be acquiring the s-400).

Does this mean that Turkey which is a NATO member state will withdraw from the integrated US-NATO-Israel air defense system? Such a decision is tantamount to NATOExit.

Moreover, Turkey’s long-standing alliance with Israel is no longer functional. In turn, The US-Turkey-Israel “Triple Alliance” is defunct.

In 1993, Israel and Turkey signed a Memorandum of Understanding leading to the creation of (Israeli-Turkish) “joint committees” to handle so-called regional threats. Under the terms of the Memorandum, Turkey and Israel agreed “to cooperate in gathering intelligence on Syria, Iran, and Iraq and to meet regularly to share assessments pertaining to terrorism and these countries’ military capabilities.”

Image on the right: Sharon and Erdogan in 2004

The triple alliance was also coupled with a 2005 NATO-Israeli military cooperation agreement which included “many areas of common interest, such as the fight against terrorism and joint military exercises.”  These military cooperation ties with NATO were viewed by the Israeli military as a means to “enhance Israel’s deterrence capability regarding potential enemies threatening it, mainly Iran and Syria.”

The “triple alliance” linking the US, Israel and Turkey was coordinated by the US Joint Chiefs of Staff. It was an integrated and coordinated military command structure pertaining to the broader Middle East. It was based on close bilateral US military ties respectively with Israel and Turkey, coupled with a strong bilateral military relationship between Tel Aviv and Ankara. In this regard, Israel and Turkey were close partners with the US in planned aerial attacks on Iran since 2005. (See Michel Chossudovsky, May 2005). Needless to say, that triple alliance is defunct.

With Turkey siding with Iran and Russia, it would be “suicide” for US-Israel to even consider waging aerial attacks on Iran.

Moreover, the NATO-Israel 2005 military cooperation agreement which relied heavily on the role of Turkey is dysfunctional. What this means is that US-Israeli threats directed against Iran are no longer supported by Turkey which has entered into an alliance of convenience with Iran.

The broader Realignment of Military alliances

The shift in military alliances is not limited to Turkey. Following the rift between Qatar and Saudi Arabia, the Gulf Cooperation Council (GCC) is in disarray with Qatar siding with Iran and Turkey against Saudi Arabia and the UAE. Qatar is of utmost strategic significance because it shares with Iran the world’s largest maritime gas fields in the Persian Gulf. (see map below)

The Al-Udeid military base near Doha is America’s largest military base in the Middle East, which hosts US Central Command’s forward headquarters in the Middle East. In turn, Turkey has now established its own military facility in Qatar.

The Shanghai Cooperation Organization (SCO)

A profound shift in geopolitical alliances is also occurring in South Asia with the instatement in 2017 of both India and Pakistan as full members of the Shanghai Cooperation Organization (SCO).  Inevitably, this historic shift constitutes a blow against Washington, which has defense and trade agreements with both Pakistan and India. “While India remains firmly aligned with Washington, America’s political stranglehold on Pakistan (through military and intelligence agreements) has been weakened as a result of Pakistan’s trade and investment deals with China.”  (Michel Chossudovsky, August 1, 2017)

In other words, this enlargement of the SCO weakens America’s hegemonic ambitions in both South Asia and the broader Eurasian region. It has a bearing on energy pipeline routes, transport corridors, borders and mutual security and maritime rights.

Pakistan is the gateway to Afghanistan and Central Asia, where US influence has been weakened to the benefit of China, Iran and Turkey. China is involved in major investments in mining, not to mention the development of transport routes which seek the integration of Afghanistan into Western China.

Where does Turkey fit in? Turkey is increasingly part of the Eurasian project dominated by China and Russia. In 2017-18, Erdogan had several meetings with both president Xi-Jinping and Vladimir Putin. Turkey is currently a dialogue partner of the SCO.

The Antiwar Movement: #NATOExit People’s Movement

Of crucial significance, the crisis within NATO constitutes a historic opportunity to develop a #NATOExit people’s movement across Europe and North America, a people’s movement pressuring governments to withdraw from the Atlantic Alliance, a movement to eventually dismantle and abolish the military and political apparatus of the North Atlantic Treaty Organization.

Image right; logo of the No Guerra No Nato Florence Movement to Exit NATO

Part of this updated article was taken from an earlier text by the author.

Shifting Alliances: Is Turkey Now “Officially” an Ally of Russia? Acquires Russia’s S-400. Exit from NATO Imminent?

Global Research, July 13, 2019

Turkey is taking delivery of Russia’s S 400 missile defence system. What this signifies is that Turkey and Russia are now “officially” allies. The first shipment of the S-400 landed in Ankara on July 12, according to Turkey’s Ministry of Defense. (see image below)

Two more shipments are due, with the third delivery of “over 120 anti-aircraft missiles of various types… [scheduled] tentatively at the end of the summer, by sea.” 

Reports confirm that the “Turkish S-400 operators will travel to Russia for training in July and August. About 20 Turkish servicemen underwent training at a Russian training center in May and June, …”(CNN, July 12, 2019)

How will the US respond?

In all likelihood, Erdogan’s presidency will be the object of an attempted regime change, not to mention ongoing financial reprisals directed against the Turkish Lira as well as economic sanctions. 

Bloomberg screenshot

What is unfolding is an all out crisis in the structure of military alliances. Turkey cannot reasonably retain its NATO membership while at the same time entering into a military cooperation agreement with the Russian Federation. 

Reminiscent of World War I, shifting alliances and the structure of military coalitions are crucial determinants of history.

Today’s military alliances, including “cross-cutting coalitions” between “Great Powers” are markedly different and exceedingly more complex than those pertaining to World War I. (i.e  the confrontation between “The Triple Entente” and “the Triple Alliance”).

Turkey’s de facto exit from NATO points to a historical shift in the structure of military alliances which could potentially contribute to weakening US hegemony in the Middle East as well as creating conditions which could lead to a breakup of the North Atlantic Treaty Organization (NATO).

NATO constitutes a formidable military force composed of 29 member states, which is largely controlled by the Pentagon. It is a military coalition and an instrument of modern warfare. It constitutes a threat to global security and World peace. 

Divisions within the Atlantic Alliance could take the form of one or more member states deciding to “Exit NATO”. Inevitably an NATO-Exit movement would weaken the unfolding consensus imposed by our governments which at the this juncture in our history consists in threatening to wage a pre-emptive war against Iran and the Russian Federation.  

Sleeping with the Enemy

While Turkey is still “officially” a member of NATO, president Recep Tayyip Erdoğan (right) has for the last two years been developing “friendly relations” with two of America’s staunchest enemies, namely Iran and Russia.

US-Turkey military cooperation (including US air force bases in Turkey) dates back to the Cold War.

Turkey by a long shot has the largest conventional forces (after the US) within NATO outpacing France, Britain and Germany,

#NATOExit

Broadly speaking, the US-Turkey rift and its implications for the Atlantic Alliance have sofar been ignored or trivialized by the media.

NATO is potentially in a shambles. The delivery of the S-400 almost a year ahead of schedule will contribute to further destabilising the structure of  military alliances to the detriment of Washington.

Turkey is also an ally of Iran. Inevitably, Turkey’s possession of the S-400 will affect ongoing US war plans directed against Iran (which will also be acquiring the s-400).

Does this mean that Turkey which is a NATO member state will withdraw from the integrated US-NATO-Israel air defense system? Such a decision is tantamount to NATOExit.

Moreover, Turkey’s long-standing alliance with Israel is no longer functional. In turn, The US-Turkey-Israel “Triple Alliance” is defunct.

In 1993, Israel and Turkey signed a Memorandum of Understanding leading to the creation of (Israeli-Turkish) “joint committees” to handle so-called regional threats. Under the terms of the Memorandum, Turkey and Israel agreed “to cooperate in gathering intelligence on Syria, Iran, and Iraq and to meet regularly to share assessments pertaining to terrorism and these countries’ military capabilities.”

Image on the right: Sharon and Erdogan in 2004

The triple alliance was also coupled with a 2005 NATO-Israeli military cooperation agreement which included “many areas of common interest, such as the fight against terrorism and joint military exercises.”  These military cooperation ties with NATO were viewed by the Israeli military as a means to “enhance Israel’s deterrence capability regarding potential enemies threatening it, mainly Iran and Syria.”

The “triple alliance” linking the US, Israel and Turkey was coordinated by the US Joint Chiefs of Staff. It was an integrated and coordinated military command structure pertaining to the broader Middle East. It was based on close bilateral US military ties respectively with Israel and Turkey, coupled with a strong bilateral military relationship between Tel Aviv and Ankara. In this regard, Israel and Turkey were close partners with the US in planned aerial attacks on Iran since 2005. (See Michel Chossudovsky, May 2005). Needless to say, that triple alliance is defunct.

With Turkey siding with Iran and Russia, it would be “suicide” for US-Israel to even consider waging aerial attacks on Iran.

Moreover, the NATO-Israel 2005 military cooperation agreement which relied heavily on the role of Turkey is dysfunctional. What this means is that US-Israeli threats directed against Iran are no longer supported by Turkey which has entered into an alliance of convenience with Iran.

The broader Realignment of Military alliances

The shift in military alliances is not limited to Turkey. Following the rift between Qatar and Saudi Arabia, the Gulf Cooperation Council (GCC) is in disarray with Qatar siding with Iran and Turkey against Saudi Arabia and the UAE. Qatar is of utmost strategic significance because it shares with Iran the world’s largest maritime gas fields in the Persian Gulf. (see map below)

The Al-Udeid military base near Doha is America’s largest military base in the Middle East, which hosts US Central Command’s forward headquarters in the Middle East. In turn, Turkey has now established its own military facility in Qatar.

The Shanghai Cooperation Organization (SCO)

A profound shift in geopolitical alliances is also occurring in South Asia with the instatement in 2017 of both India and Pakistan as full members of the Shanghai Cooperation Organization (SCO).  Inevitably, this historic shift constitutes a blow against Washington, which has defense and trade agreements with both Pakistan and India. “While India remains firmly aligned with Washington, America’s political stranglehold on Pakistan (through military and intelligence agreements) has been weakened as a result of Pakistan’s trade and investment deals with China.”  (Michel Chossudovsky, August 1, 2017)

In other words, this enlargement of the SCO weakens America’s hegemonic ambitions in both South Asia and the broader Eurasian region. It has a bearing on energy pipeline routes, transport corridors, borders and mutual security and maritime rights.

Pakistan is the gateway to Afghanistan and Central Asia, where US influence has been weakened to the benefit of China, Iran and Turkey. China is involved in major investments in mining, not to mention the development of transport routes which seek the integration of Afghanistan into Western China.

Where does Turkey fit in? Turkey is increasingly part of the Eurasian project dominated by China and Russia. In 2017-18, Erdogan had several meetings with both president Xi-Jinping and Vladimir Putin. Turkey is currently a dialogue partner of the SCO.

The Antiwar Movement: #NATOExit People’s Movement

Of crucial significance, the crisis within NATO constitutes a historic opportunity to develop a #NATOExit people’s movement across Europe and North America, a people’s movement pressuring governments to withdraw from the Atlantic Alliance, a movement to eventually dismantle and abolish the military and political apparatus of the North Atlantic Treaty Organization.

Image right; logo of the No Guerra No Nato Florence Movement to Exit NATO

Part of this updated article was taken from an earlier text by the author.

Sultan shines in the court of the Dragon King

Sultan shines in the court of the Dragon King

by Pepe Escobar : Posted with permission

July 10, 2019

The graphiSultan shines in the court of the Dragon Kingc image of Turkey pivoting away from NATO towards the Russia-China strategic partnership was provided, in more ways than one, by Turkish President Tayyip Erdogan visiting Chinese President Xi Jinping in Beijing right after the G20 in Osaka.

Turkey is a key hub in the emerging New Silk Roads, or Belt and Road Initiative. Erdogan is a master at selling Turkey as the ultimate East-West crossroads. He has also expressed much interest in joining the Shanghai Cooperation Organization (SCO), led by Russia-China, whose annual summit took place in Bishkek a few days before Osaka.

In parallel, against hell and high water – from threats of sanctions by the US Congress to NATO warnings – Erdogan never budged from Ankara’s decision to buy Russian S-400 defense missile systems, a $2.5-billion contract according to Rostec’s Sergei Chemezov.

The S-400s start to be shipped to Turkey as early as this week. According to Turkish Minister of Defense Hulusi Akar, their deployment should start by October. Much to Washington’s ire, Turkey is the first NATO member state to buy S-400s.

Xi, as he welcomed Erdogan in Beijing, stressed the message he crafted together with Putin in their previous meetings in St Petersburg, Bishkek and Osaka: China and Turkey should “uphold a multilateral world order with the United Nations at its core, a system based on international law.”

Erdogan, for his part, turned up the charm – from publishing an op-ed in the Global Times extolling a common vision of the future to laying it out in some detail. His target is to consolidate Chinese investment in multiple areas in Turkey, directly or indirectly related to Belt and Road.

BEIJING, CHINA – JULY 02: President of Turkey, Recep Tayyip Erdogan (R) and Chinese President Xi Jinping (L) walk past the honor guards during an official welcoming ceremony at Great Hall of the People in Beijing, China on July 02, 2019. Volkan Furuncu / Anadolu Agency

Addressing the extremely sensitive Uighur dossier head on, Erdogan deftly executed a pirouette. He eschewed accusations from his own Foreign Ministry that “torture and political brainwashing” were practiced in Uighur detention camps and would rather comment that Uighurs “live happily” in China. “It is a fact that the peoples of China’s Xinjiang region live happily in China’s development and prosperity. Turkey does not permit any person to incite disharmony in the Turkey-China relationship.”

This is even more startling considering that Erdogan himself, in the past decade, had accused Beijing of genocide. And in a famous 2015 case, hundreds of Uighurs about to be deported from Thailand back to China ended up, after much fanfare, being resettled in Turkey.

New geopolitical caravan

Erdogan seems to have finally realized that the New Silk Roads are the 2.0 digital version of the Ancient Silk Roads whose caravans linked the Middle Kingdom, via trade, to multiple lands of Islam – from Indonesia to Turkey and from Iran to Pakistan.

Before the 16th century, the main line of communication across Eurasia was not maritime, but the chain of steppes and deserts from Sahara to Mongolia, as Arnold Toynbee wonderfully observed. Walking the line we would find merchants, missionaries, travelers, scholars, all the way to Turko-Mongols from Central Asia migrating to the Middle East and the Mediterranean. They all formed the stuff of interconnection and cultural exchange between Europe and Asia – way beyond geographical discontinuity.

Arguably Erdogan is now able to read the new tea leaves. The Russia-China strategic partnership – directly involved in linking Belt and Road with the Eurasia Economic Union and also the International North-South Transportation Corridor – considers Turkey and Iran as absolutely indispensable key hubs for the ongoing, multi-layered Eurasia integration process.

A new Turkey-Iran-Qatar geopolitical and economic axis is slowly but surely evolving in Southwest Asia, ever more linked to Russia-China. The thrust is Eurasia integration, visible for instance via a frenzy of railroad building designed to link the New Silk Roads, and the Russia-Iran transportation corridor, to the Eastern Mediterranean and the Red Sea and, eastwards, the Iran-Pakistan corridor to the China-Pakistan Economic Corridor, one of Belt and Road’s highlights.

This is all being supported by interlocking transportation cooperation agreements involving Turkey-Iran-Qatar and Iran-Iraq-Syria.

The end result not only consolidates Iran as a key Belt and Road connectivity hub and China’s strategic partner, but also by contiguity Turkey – the bridge to Europe.

As Xinjiang is the key hub in Western China connecting to multiple Belt and Road corridors, Erdogan had to find a middle ground – in the process minimizing, to a great extent, waves of disinformation and Western-peddled Sinophobia. Applying Xi Jinping thought, one would say Erdogan opted for privileging cultural understanding and people-to-people exchanges over an ideological battle.

The flags of China and Turkey flutter in Beijing during Erdogan’s visit to China on July 2. Photo: Wang Xin/ ImagineChina / AFP

Ready to mediate

In conjunction with his success at the court of the Dragon King, Erdogan now feels emboldened enough to offer his services as mediator between Tehran and the Trump administration – picking up on a suggestion he made to Japanese Prime Minister Shinzo Abe at the G20.

Erdogan would not have made that offer if it had not been discussed previously with Russia and China – which, crucially, are member signatories of the Iran nuclear deal, or Joint Comprehensive Plan Of Action (JCPOA).

It’s easy to see how Russia and China should consider Turkey the perfect mediator: a neighbor of Iran, the proverbial bridge between East and West, and a NATO member. Turkey is certainly much more representative than the EU-3 (France, UK, Germany).

Trump seems to want – or at least gives the impression of imposing – a JCPOA 2.0, without an Obama signature. The Russia-China partnership could easily call his bluff, after clearing it with Tehran, by offering a new negotiating table including Turkey. Even if the ineffective – in every sense – EU-3 remained, there would be real counterbalance in the form of Russia, China and Turkey.

Out of all these important moves in the geopolitical chessboard, one motivation stands out among top players: Eurasian integration cannot significantly progress without challenging the Trumpian sanction obsession.

Debunking the Indo-Pacific Myth

Pepe Escobar
July 9, 2019
Image result for Debunking the Indo-Pacific Myth
© Photo: Navy.mil

The Trump administration is obsessively spinning the concept of a “free and open Indo-Pacific”. Apart from a small coterie of scholars, very few people around the world, especially across the Global South, know what that means since the then incipient strategy was first unveiled at the 2017 APEC forum in Vietnam.

Now everything one needs to know – and especially not know – about the Indo-Pacific is contained in a detailed Pentagon report.

Still: is this an act, or the real deal? After all, the strategy was unveiled by “acting” Pentagon head Patrick Shanahan (the Boeing guy), who latter committed hara-kiri, just to be replaced by another, revolving door, “acting” secretary, Mark Espel (the Raytheon guy).

Shanahan made a big deal of Indo-Pacific when he hit the 18thShangri-La Dialogue in Singapore last month, picking up on his introduction to the Pentagon report to stress the “geopolitical rivalry between free and repressive world order visions” and demonizing China for seeking to “reorder the region to its advantage”.

In contrast, all the benign Pentagon yearns for is just “freedom” and “openness” for a “networked region”; calling it the New Pentagon Silk Road wouldn’t be far fetched.

Anyone remotely familiar with “Indo-Pacific” knows that’s code for demonization of China; actually, the Trump administration’s version of Obama’s “pivot to Asia”, which was in itself a State Dept. concoction, via Kurt Campbell, fully appropriated by then Secretary Hillary Clinton.

“Indo-Pacific” congregates the Quad – US, Japan, India and Australia – in a “free” and “open” God-given mission. Yet this conception of freedom and openness blocks the possibility of China turning the mechanism into a Quintet.

Add to it what hawkish actor Esper told the Senate Armed Services Committee way back in 2017:

“My first priority will be readiness – ensuring the total Army is prepared to fight across the full spectrum of conflict. With the Army engaged in over 140 countries around the world, to include combat operations in Afghanistan and Iraq, training rotations to Europe to deter Russia, and forward deployed units in the Pacific defending against a bellicose North Korea, readiness must be our top priority.”

That was 2017. Esper didn’t even talk about China – which at the time was not the demonized “existential threat” of today. The Pentagon continues to be all about Full Spectrum Dominance.

Beijing harbors no illusions about the new Indo-Pacific chief they will be dealing with.

Surfing FONOP

“Indo-Pacific” is a hard nut to sell to ASEAN. As much as selected members may allow themselves to profit from some “protection” by the US military, Southeast Asia as a whole maintains top trade relations with China; most nations are participants of the New Silk Roads, or Belt and Road Initiative (BRI) and members of the Asian Infrastructure Investment Bank (AIIB); and they will not shrink from enjoying the benefits of Huawei’s 5G future.

Actually even the other three in the Quad, as much as they are not linked to BRI, are having second thoughts on playing supportive roles in an all-American super production. They are very careful about their geoeconomic relations with China. “Indo-Pacific”, a club of four, is a de facto late response to BRI – which is indeed open, to over 65 nations so far.

The Pentagon’s favorite mantra concerns the enforcement of “freedom of navigation operations” (FONOP) – as if China, juggling the countless tentacles of global supply chains, would have any interest in provoking naval insecurity anywhere.

So far, “Indo-Pacific” has made sure that the US Pacific Command was renamed US Indo-Pacific Command. And that’s about it. Everything remains the same in terms of those FONOPs – in fact a carefully deceptive euphemism for the US Navy to be on 24/7 patrol anywhere across Asian seas, from the Indian to the Pacific, and especially the South China Sea. No ASEAN nation though will be caught dead performing FONOPS in South China Sea waters within 12 nautical miles of rocks and reefs claimed by Beijing.

The rampant demonization of China, now a bipartisan sport across the Beltway, on occasion even more hysterical than the demonization of Russia, also features proverbial reports by the Council on Foreign Relations – the establishment’s think tank by definition – on China as a serial aggressor, politically, economically and militarily, and BRI as a geoeconomic tool to coerce China’s neighbors.

So it’s no wonder this state of affairs has led Secretary of State Mike Pompeo on a recent, frenetic Indo-Pacific related tour, including Quad members India and Japan and possible associates Saudi Arabia, UAE and South Korea.

Geopoliticians of the realist school do fear that Pompeo, a fanatic Christian Zionist, may be enjoying under Trump a virtual monopoly on US foreign policy; a former CIA director playing warmongering top “diplomat” while also “acting” as Pentagon head trampling other second string actors who are not under full employment.

His Indo-Pacific roving was a de facto tour de force emphasizing the containment/demonization not only of China but also Iran, which should be seen as the major US target in the Indo/Southwest Asia part of the club. Iran is not only about strategic positioning and being a major BRI hub; it’s about immense reserves of natural gas to be traded bypassing the US dollar.

The fact that the non-stop demonization of Iran and/or China “aggression” comes from a hyperpower with over 800 military bases or lily pads spread out across every latitude plus a FONOP armada patrolling the seven seas is enough to send the hardest cynic into a paroxysm of laughter.

The high-speed train has left the station

In the end, everything under “Indo-Pacific” goes back to what game India is playing.

New Delhi meekly opted for not buying oil from Iran after the Trump administration lifted its sanctions waiver. New Delhi had promised earlier, on the record, to only respect UN Security Council sanctions, not unilateral – and illegal – US sanctions.

This decision is set to jeopardize India’s dream of extending its new mini-Silk Road to Afghanistan and Central Asia based on the Iranian port of Chabahar. That was certainly part of the discussions during the Shanghai Cooperation Organization (SCO) summit in Bishkek, when full members Putin, Xi and Modi, plus Rouhani – as the head of an observer nation – were sitting at the same table.

New Delhi’s priority – embedded deep in the Indian establishment – may be containment of China. Yet Putin and Xi – fellow BRICS and SCO members – are very much aware that Modi cannot at the same time antagonize China and lose Iran as partner, and are deftly working on it.

Image result for Putin, Xi and Modi, plus Rouhani

On the Eurasian chessboard, the Pentagon and the Trump administration, together, only think Divide and Rule. India must become a naval power capable of containing China in the Indian Ocean while Japan must contain China economically and militarily all across East Asia.

Japan and India do meet – again – when it comes to another more geoeconomically specific anti-BRI scheme; the Asia-Africa Growth Corridor (AAGC), which so far has had a minimal impact and stands no chance of luring dozens of nations across the Global South away from BRI-related projects.

The chessboard now clearly shows Indo-Pacific pitted against the three key hubs of Eurasia integration – Russia-China-Iran. The definitive unraveling of Indo-Pacific – even before it starts gaining ground – would be a clear commitment by New Delhi to break apart the US sanctions regime by restarting purchases of much-needed Iran oil and gas.

It won’t take much for Modi to figure out that taking a second role in a Made in USA production will leave him stranded at the station eating dust just as the high-speed Eurasia integration train passes him by.

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Russia-India-China share a room with a view

July 01, 2019

by Pepe Escobar : Posted with permission

Russia-India-China share a room with a view

The most important trilateral at the G20 in Osaka was confined to a shoddy environment unworthy of Japan’s unrivaled aesthetic minimalism.

Japan excels in perfect planning and execution. So it’s hard to take this setup as an unfortunate “accident.” At least the – unofficial – Russia-India-China summit at the sidelines of the G20 transcended the fate of an interior decorator deserving to commit seppuku.

Leaders of these three countries met in virtual secrecy. The very few media representatives present in the shabby room were soon invited to leave. Presidents Putin, Xi and Modi were flanked by streamlined teams who barely found enough space to sit down. There were no leaks. Cynics would rather joke that the room may have been bugged anyway. After all, Xi is able to call Putin and Modi to Beijing anytime he wants to discuss serious business.

New Delhi is spinning that Modi took the initiative to meet in Osaka. That’s not exactly the case. Osaka is a culmination of a long process led by Xi and Putin to seduce Modi into a serious Eurasia integration triangular road map, consolidated at their previous meeting last month at the Shanghai Cooperation Organization (SCO) summit in Bishkek.

Now Russia-India-China (RIC) is fully back in business; the next meeting is set for the Eastern Economic Forum in Vladivostok in September.

In their introductory remarks, Putin, Xi and Modi made it clear that RIC is all about configuring, in Putin’s words, an “indivisible security architecture” for Eurasia.

Modi – very much in a Macron vein – stressed the multilateral effort to fight climate change, and complained that the global economy is being ruled by a “one-sided” dictate, emphasizing the necessity of a reform of the World Trade Organization.

Putin went a step ahead, insisting, “our countries are in favor of preserving the system of international relations, whose core is the UN Charter and the rule of law. We uphold such important principles of interstate relations as respect for sovereignty and non-interference in domestic affairs.”

Putin clearly underlined the geopolitical interconnection of the UN, BRICS, SCO and G20, plus “strengthening the authority of the WTO” and the International Monetary Fund as the “paragon of a modern and just multipolar world that denies sanctions as legitimate actions.”

The Russia-India-China contrast with the Trump administration could not be starker.

Those ‘tremendous assets’

BRICS, as it stands, is dead. There was an “official,” pro-forma BRICS meeting before the RIC. But it’s no secret both Putin and Xi completely distrust Brazil’s Jair Bolsonaro, regarded as a Trump neocolonial asset.

Ahead of his bilateral with Trump, Bolsonaro peddled Brazil’s mineral wealth, claiming the country may now export “niobium trinkets.”

Well, that’s certainly less controversial than the Brazilian military sherpa arrested in Spain for carrying industrial quantities of cocaine (36kg) in the presidential plane, definitely ruining the after-hours party time in Osaka.

Later on, Trump eagerly praised Brazil’s “tremendous assets,” now being fully privatized to the benefit of US companies.

Xi, as he addressed the BRICS meeting, denounced protectionism and called for a stronger WTO. BRICS nations, he said, should “increase our resilience and capability to cope with external risks.”

Putin went one up. Apart from denouncing protectionist tendencies in global trade, he called for bilateral trade in national currencies bypassing the US dollar – mirroring a commitment by the Russia-China strategic partnership.

Russia-China, via Finance Minister Anton Siluanov and head of the People’s Bank of China, Yi Gang, have signed an agreement to switch to rubles and yuan in bilateral trade, starting with energy and agriculture, and increase cross-currency settlements by 50% in the next few years.

There will be a concerted effort to increasingly bypass SWIFT, using the Russian System for Transfer of Financial Messages (SPFS) and the Chinese Cross-Border Inter-Bank Payments System (CIPS).

Sooner or later Russia-China will entice India to join. Moscow has excellent bilateral relations with both Beijing and New Delhi, and is decisively playing the role of privileged messenger.

The mini-trade war against New Delhi launched by the Trump administration – including the loss of India’s special trade status and punishment for buying Russian S-400 missile systems – is quickening the pace of the process. India, by the way, will pay for the S-400s in euros.

There were no leaks whatsoever from Russia-India-China about Iran. But diplomats say that was a key theme of the discussion. Russia is already – covertly – helping Iran on myriad levels. India has an existential choice to make: keep buying Iranian oil or say goodbye to Iran’s strategic help, via the Chabahar port, to facilitate India’s mini-Silk Road to Afghanistan and Central Asia.

China sees Iran as a key node of the New Silk Roads, or Belt and Road Initiative. Russia sees Iran as essential for strategic stability in Southwest Asia – a key theme of the Putin-Trump bilateral, which also discussed Syria and Ukraine.

The leaders of RIC – Russian President Vladimir Putin, Indian Prime Minister Narendra Modi and Chinese President Xi Jinping – hold a meeting on the sidelines of the G20 summit in Osaka on June 28, 2019. Photo: Mikhail Klimentyev / Sputnik / AFP

The leaders of RIC – Russian President Vladimir Putin, Indian Prime Minister Narendra Modi and Chinese President Xi Jinping – hold a meeting on the sidelines of the G20 summit in Osaka on June 28, 2019. Photo: Mikhail Klimentyev / Sputnik / AFP

RIC or Belt and Road?

Whatever the psyops tactics employed by Trump, Russia-India-China is also directly implicated in the massive short and long-term ramifications of the Trump-Xi bilateral in Osaka. The Big Picture is not going to change; the Trump administration is betting on re-routing global supply chains out of China, while Beijing advances full speed ahead with its Belt and Road Initiative.

Trump is heavily distrusted across Europe – as Brussels knows the EU is the target of another imminent trade war. Meanwhile, with over 60 nations committed to myriad Belt and Road projects, and with the Eurasia Economic Union also interlinked with Belt and Road, Beijing knows it’s just a matter of time before the whole of the EU hits the BRI highway.

There’s no evidence that India may suddenly join Belt and Road projects. The geopolitical lure of “Indo-Pacific” – essentially just another strategy for containment of China – looms large. That’s good old imperial Divide and Rule – and all the major players know it.

Yet India, now on the record, is starting to spin that Indo-Pacific is not “against somebody.” India getting deeper into RIC does not imply getting closer to Belt and Road.

It’s time for Modi to rise to the occasion; ultimately, he will decide which way the geoeconomic pendulum swings.

Russia-India-China will be the big G20 hit

June 27, 2019

It all started with the Vladimir Putin–Xi Jinping summit in Moscow on June 5. Far from a mere bilateral, this meeting upgraded the Eurasian integration process to another level. The Russian and Chinese presidents discussed everything from the progressive interconnection of the New Silk Roads with the Eurasia Economic Union, especially in and around Central Asia, to their concerted strategy for the Korean Peninsula.

Russian President Vladimir Putin and Indian Prime Minister Narendra Modi (left) hug during their meeting before a session of the Heads of State Council of the Shanghai Cooperation Organization (SCO), in Bishkek, Kyrgyzstan. Photo: AFP / Grigory Sysoev / Sputnik

A particular theme stood out: They discussed how the connecting role of Persia in the Ancient Silk Road is about to be replicated by Iran in the New Silk Roads, or Belt and Road Initiative (BRI). And that is non-negotiable. Especially after the Russia-China strategic partnership, less than a month before the Moscow summit, offered explicit support for Tehran signaling that regime change simply won’t be accepted, diplomatic sources say.

Putin and Xi solidified the roadmap at the St Petersburg Economic Forum. And the Greater Eurasia interconnection continued to be woven immediately after at the Shanghai Cooperation Organization (SCO) summit in Bishkek, with two essential interlocutors: India, a fellow BRICS (Brazil, Russia, India, China, South Africa) and SCO member, and SCO observer Iran.

At the SCO summit we had Putin, Xi, Narendra Modi, Imran Khan and Iranian President Hassan Rouhani sitting at the same table. Hanging over the proceedings, like concentric Damocles swords, were the US-China trade war, sanctions on Russia, and the explosive situation in the Persian Gulf.

Rouhani was forceful – and played his cards masterfully – as he described the mechanism and effects of the US economic blockade on Iran, which led Modi and leaders of the Central Asian “stans” to pay closer attention to Russia-China’s Eurasia roadmap. This occurred as Xi made clear that Chinese investments across Central Asia on myriad BRI projects will be significantly increased.

Russia-China diplomatically interpreted what happened in Bishkek as “vital for the reshaping of the world order.” Crucially, RIC – Russia-India-China – not only held a trilateral but also scheduled a replay at the upcoming Group of Twenty summit in Osaka. Diplomats swear the personal chemistry of Putin, Xi and Modi worked wonders.

The RIC format goes back to old strategic Orientalist fox Yevgeny Primakov in the late 1990s. It should be interpreted as the foundation stone of 21st-century multipolarity, and there’s no question how it will be interpreted in Washington.

India, an essential cog in the Indo-Pacific strategy, has been getting cozy with “existential threats” Russia-China, that “peer competitor” – dreaded since geopolitics/geo-strategy founding father Halford Mackinder published his “Geographical Pivot of History” in 1904 –  finally emerging in Eurasia.

RIC was also the basis on which the BRICS grouping was set up. Moscow and Beijing are diplomatically refraining from pronouncing that. But with Brazil’s Jair Bolsonaro seen as a mere Trump administration tool, it’s no wonder that Brazil has been excluded from the RIC summit in Osaka. There will be a perfunctory BRICS meeting right before the start of the G20 on Friday, but the real deal is RIC.

Pay attention to the go-between

The internal triangulation of RIC is extremely complex. For instance, at the SCO summit Modi said that India could only support connectivity projects based on “respect of sovereignty” and “regional integrity.” That was code for snubbing the Belt and Roads Initiative – especially because of the flagship China-Pakistan Economic Corridor, which New Delhi insists illegally crosses Kashmir. Yet India did not block the final Bishkek declaration.

What matters is that the Xi-Modi bilateral at the SCO was so auspicious that Indian Foreign Secretary Vijay Gokhale was led to describe it as “the beginning of a process, after the formation of government in India, to now deal with India-China relations from both sides in a larger context of the 21st century and of our role in the Asia-Pacific region.” There will be an informal Xi-Modi summit in India in October. And they meet again at the BRICS summit in Brazil in November.

Putin has excelled as a go-between. He invited Modi to be the guest of honor at the Eastern Economic Forum in Vladivostok in early September. The thrust of the relationship is to show to Modi the benefits for India to actively join the larger Eurasia integration process instead of playing a supporting role in a Made in USA production.

That may even include a trilateral partnership to develop the Polar Silk Road in the Arctic, which represents, in a nutshell, the meeting of the Belt and Road Initiative with Russia’s Northern Sea Route. China Ocean Shipping (Cosco) is already a partner of the Russian company PAO Sovcomflot, shipping natural gas both east and west from Siberia.

Xi is also beginning to get Modi’s attention on the restarting possibilities for the Bangladesh-China-India-Myanmar (BCMI) corridor, another major Belt and Road project, as well as improving connectivity from Tibet to Nepal and India.

Impediments, of course, remain plentiful, from disputed Himalayan borders to, for instance, the slow-moving Regional Comprehensive Economic Partnership (RCEP) – the 16-nation theoretical successor of the defunct Trans-Pacific Partnership. Beijing is adamant the RCEP must go into overdrive, and is even prepared to leave New Delhi behind.

One of Modi’s key decisions ahead is on whether to keep importing Iranian oil – considering there are no more US sanctions waivers. Russia is ready to help Iran and weary Asian customers such as India if the EU-3 continue to drag the implementation of their special payment vehicle.

India is a top Iran energy customer. Iran’s port of Chabahar is absolutely essential if India’s mini-Silk Road is to reach Central Asia via Afghanistan. With US President Donald Trump’s administration sanctioning New Delhi over its drive to buy the Russian S-400 air defense system and the loss of preferred trade status with the US, getting closer to Bridge and Road – featuring energy supplier Iran as a key vector – becomes a not-to-be-missed economic opportunity.

With the roadmap ahead for the Russia-China strategic partnership fully solidified after the summits in Moscow, St Petersburg and Bishkek, the emphasis now for RC is to bring India on board a full-fledged RIC. Russia-India is already blossoming as a strategic partnership. And Xi-Modi seemed to be in sync. Osaka may be the geopolitical turning point consolidating RIC for good.

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