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Impacts, Prospects, Opportunities

This report analyzes the impact of China's presence in the Indian Ocean region on regional security, energy security, and non-energy economic relations. It also discusses future prospects and opportunities, as well as provides an opportunity analysis for potential US actions in the region.

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Impacts, Prospects, Opportunities

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  1. China in the IndianOcean Region: Impacts, Prospects, Opportunities Client: U.S. Government, Office of South Asia Analysis Nathaniel Barber Kieran Coe Victoria Steffes Jennifer Winter Prepared by:

  2. Impact Analysis • Regional Security • Energy Issues • Non-Energy Economic Relations • Trends and Prospects • “Expansionist” China • “Non-Expansionist” China • Opportunity Analysis • Trends to Obstruct or Encourage • Opportunities for Future Action Outline

  3. Impact Analysis: Regional Security New Chinese partnerships with South Asian states come at India’s expense Construction of port facilities Hambantota, Sri Lanka Chittagong, Bangladesh Sittwe, Burma Gwadar, Pakistan Economic and military aid

  4. Impact Analysis: Regional Security

  5. Impact Analysis: Energy Security • Definition of energy security: • Availability • Reliability • Affordability • China and India face three primary energy security risks • High proportion of oil imports • Reliance on dominant oil exporting countries • Dependence on vulnerable sea lanes

  6. Impact Analysis: Energy Security

  7. Impact Analysis: Non-Energy Economic Relations • Increasing Chinese Trade in the Indian Ocean region • India’s Trade Deficit with China • Foreign Direct Investment by China and India

  8. Impact Analysis: Non-Energy Economic Relations

  9. Prospects and Trends: Assumptions • “Expansionist” China • “Non-Expansionist” China • Likelihood Scale Very unlikely Unlikely Somewhat unlikely Plausible Somewhat likely Likely Very likely

  10. Prospects and Trends:Regional Security

  11. Prospects and Trends:Energy Security

  12. Prospects and Trends: Non-Energy Economic Relations

  13. Opportunity Analysis: Trends Trends to Obstruct Chinese FDI to regional states Chinese-financed and built ports Trends to Encourage U.S.-India relationship India’s relationship with regional states Indian and Chinese acquisition of energy resources Chinese-Indian trade Membership in international energy organizations

  14. Opportunity Analysis: U.S. Action Strengthen U.S. relations with India Expand relations with Chinese-courted regional states Maintain naval superiority in the Indian Ocean Ensure energy security for South Asian states Pursue a less unequal trade balance with China

  15. Questions?

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