By Azhar Azam
Central Asia, due to its terrestrial location to sit at the confluence of China, Russia, South Asia and the Middle East, and potential to serve as a gateway to Europe, long captured attention of global powers; the US withdrawal from Afghanistan, the Ukraine war and battle for geopolitical influence has considerably elevated the region's strategic importance.
While the European Union (EU) has committed to invest €10 billion in sustainable transport network including the Trans-Caspian International Transport Route (TITR), the US support of Central Asia's about making their "own choices" and helping them develop their transportation infrastructure with an eye to exploit the region's potential in producing rare earth metals threaten to fabricate Central Asia into a geopolitical and geostrategic arena.
Such risks swell sharply given Washington hasn't historically afforded Central Asia the attention it gave to other parts of the world. The US interest in the region waned further once it no longer needed Central Asia as a conduit to wreak havoc in Afghanistan, redefining its foreign policy and shifting focus from South to Southeast Asia to offset the so-called China threat.
Even in the early one and a half year of the Ukraine crisis, America's interest was absent in the region until the US President Joe Biden hosted a C5+1 summit with the five Central Asian leaders in September and pledged to solidify security, clean energy and economic partnership including through investment in and development of the Trans-Caspian International Transport Route.
The so-called Middle Corridor – which begins from Southeast Asia and China, runs through Kazakhstan, the Caspian Sea, Azerbaijan, Georgia and further to European countries – holds a great significance for the participating economies in terms of trade and reduced travel times; what effectively drove America to cajole the region was the Chinese President Xi Jinping’s meeting with the regional leaders in May that promised to seal close economic and security relations between China and Central Asia.
An overriding goal behind the European Union (EU) wooing of the region has been to end its reliance on Russian’s oil and gas, seek alternative corridor that don’t depend on Moscow and diversify its sources of critical raw materials; the US too sees Central Asia as critical to seize rare earth minerals to break China's near monopoly. Biden's newfound initiative to ameliorate relations with the region, hence, could at best be declared as reactionary rather than proactive, intending to take advantage of Central Asia's geopolitical and geostrategic importance.
But challenges to these objectives emanate from the Central Asian states' close ties with China. Bilateral trade between Beijing and Central Asia in 2022 hit $70 billion with Kazakhstan accounting for $31 billion and Xi and the Kazakh President Kassym-Jomart Tokayev at the China-Central Asia summit agreeing to build the “enduring friendship” and share “weal and woe.” The China-Kazakh partnership would further bolster as Beijing-Astana trade in 2023 has surpassed $41 billion and 80% of the railroad transportation between China and EU goes through Kazakhstan.
The region has struck a very fine balance in its approach toward both Europe and Russia. It was on display when Central Asia welcomed the EU leaders and Kazakhstan received applauds from the French President Emmanuel Macron for “refusing to be a vassal of any power,” a veiled shot at Russia, while having around at the same time hailing the Kazakh relations with Russia as “multi-faceted,” which would determine the course of “strategic” cooperation.
Kazakhstan is the biggest player in Central Asia for being a large economy and its role to act as a transit route for transportation of goods between Asia and Europe. This unique position has urged Asana to remain stick to its multi-vector foreign policy, which seeks good relations with Russia, China, Europe, US and rest of the world without condoning the Russian war in Ukraine.
This equilibrium has helped the region to prevent it from becoming a theater of a new "great game" or geopolitical competition with Europe stepping into the “backyard” of China and Russia. Europe’s or the US abrupt note of Central Asia’s geostrategic importance, following decades of the region's abstraction from their priorities, cannot change this strategy overnight.
Tweaking this balanced policy perhaps isn’t needed either given it has helped Astana and the region to safeguard its national economic and security interests by simultaneously sustaining strong trade ties with Beijing and Moscow, benefiting from China’s Belt and Road Initiative (BRI), becoming a critical mineral supplier to Brussels and maintaining good relations with Washington.
Uzbekistan, another Central Asian state, is also actively pursuing an omnidirectional policy. The Uzbek President Shavkat Mirziyoyev's recent visit to Beijing where he upgraded the Uzbekistan-China relationship to "all-weather comprehensive strategic partnership.", following meetings with Macron and Italian President Sergio Mattarella, showed Tashkent was open to every country that could invest and contribute to the Uzbek economic, infrastructure, green and tech development.
By implementing the trans-Afghan corridor, the Uzbekistan-Afghanistan-Pakistan railway project that will connect the three countries as well as the EU, Russia, India and Southeast countries but stalled once Taliban took power in Afghanistan, Tashkent seeks to leverage this and other projects to enhance its attractiveness as a trans-regional transit bridge and by benefitting from tariffs. The corridor, estimated between about $5 billion and $6 billion, has a great potential in terms of trade and regional connectivity as progress is being made with officials of the three countries holding discussions in Islamabad last month.
Initiatives such as the Central Asia-South Asia Electricity (CASA-1000) electricity transmission project, designed to transport 1,300 megawatt of hydropower from Kyrgyzstan and Tajikistan, could contribute to the Afghan and Pakistan's clean transition, battle against climate change and reduce power outages. Even as Taliban lack the means to fund the projects as well as international legitimacy, the World Bank is extending financial support to Dushanbe to implement the project. Ashgabat, on the other hand, has also been making efforts to revive the dormant Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline although the project is encountering boredom from India.
Like South Asia – one the world’s least integrated regions over conflicts, inter-state rivalries and great power competition despite facing common challenges – Central Asia is poorly connected to one another and the rest of the world, hindering intra- and inter-regional connectivity for decades. But unlike South Asian countries, the Central Asian states have managed to overwhelm geopolitical competition and instead are aggressively attempting to capitalize on their strategic location, keeping eyes to improving their connectivity with all and uplifting the region's and individual country's economic profile.
While Mirziyoyev approached Qatar in December to back the trans-Afghan corridor, the Tajik President Emomali Rahmon in the same month met with the World Bank’s President Ajay Banga to jump-start the CASA-1000. Dushanbe has also extended its electricity supply agreement with Taliban, which will help it to influence Kabul to expedite work on the CASA-1000.
These attempts are backed by China whose foreign minister in May produced a joint statement with his counterparts from Afghanistan and Pakistan, supporting the extension of the China-Pakistan Economic Corridor to Afghanistan as well as the trans-Afghan railway, CASA-1000 and TAPI projects as initiatives to enhance regional connectivity and prosperity.
In a bid to attract transit container trains and the EU involvement in the Middle Corridor, Kazakhstan is considering fixing the tariff rates for five years. As Kazakhstan has removed Taliban from its terrorist list, this will help Astana to retain its access to large Afghan, Pakistani and Indian markets and create new transportation and logistics routes in the region to enter the Gulf and the Middle East through the Pakistani ports of Karachi and Gwadar, bringing a boon for the Kazakh exporters and economy.
Astana unveiled its domestic infrastructure initiative, Nurly Zhol (Bright Path), in 2014. Just a couple of years later, it aspired to integrate the project with China’s Silk Road Economic Belt citing similarities between the two projects such as trade facilitation, transit transportation and development of reliable transport and logistics infrastructure. In 2019, the Chinese and Kazakh leaders agreed to implement the cooperation plan to connect the two initiatives. Underpinned by its appeal to serve as an overland freight transport corridor between China and Europe, Kazakhstan is expected to drive economic growth over the next five years owing to increased BRI investments.
The world’s largest landlocked country, which referred to itself as a buckle in the BRI, launched the China-backed Astana International Financial Center (AIFC) in 2018. This ambition to transform Uzbekistan into a regional financial center by becoming Luxemburg-style intermediary between the large nations and a gateway for foreign investment in Central Asia is paying off as the AIFC as of 2022 had resulted in registration of 1,738 companies from 70 countries, mostly from leading economies such as China, the EU, the UK, the US, Singapore and India.
Amid its efforts to turn itself into a major Eurasian transport and logistics hub between North and South as well as emerge as epicenter of green, economic, industrial and technological development, China’s steadfast support of Central Asia’s growth agenda is one of the major factors the Central Asian people are bullish on economic relations with Beijing.
Latest stats from Urumqi Customs, revealing Xinjiang’s exports to five Central Asian states in 2023 had topped $34 billion at a staggering increase of 23.2%, underscore the regional countries and the wider Asia have rejected the US-led smear campaign to put a drag on autonomous region’s economy through sanctions and legislative proposals. The deepening Beijing-Central Asia ties on economy, trade and security are demonstrative of the region's firm resolve not to allow anyone to concoct the region into a geopolitical playhouse for their vested interests.