A Twenty-First Century Ménage à Trois: China-US-India Relations in the Indian Ocean Region

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1 24 February 2012 A Twenty-First Century Ménage à Trois: China-US-India Relations in the Indian Ocean Region Leighton G. Luke Manager Indian Ocean Research Programme Key Points Sino-US ties will experience periods of uncertainty, but both countries have a common interest in regional stability. Potential strategic competitors, India and China will become increasingly important trading partners. They are also making efforts to manage their disputed land border. Expanding Chinese and Indian naval capabilities could, however, lead to increased strategic competition in the maritime domain. Leadership changes in China, and elections in the US and India, have the potential to introduce further uncertainties. Summary This paper will make a number of considered judgments regarding future developments in the often complex relations of China, the United States and India, looking towards It must, however, be prefaced from the outset with the observation that, in international relations, a great deal can change quickly and, while one can attempt to extrapolate future developments from past and present trends, accurate predictions are notoriously difficult to make. Nevertheless, from the current vantage point at least, it is possible to discern certain possibilities. The author takes this opportunity to thank China expert and FDI Associate J.D. Yuan for providing the inspiration for the title of this Strategic Analysis Paper. The title of chapter three of his book, China and India: Co-operation or Conflict?, co-authored with W.P. Singh Sidhu, remains an accurate summation of the nature of relations between the three powers.

2 This paper also draws heavily on the findings from the FDI research workshops that investigated the strategic objectives of the three powers in the Indian Ocean region. The various Workshop Reports are available from the FDI website and readers are encouraged to peruse them. Analysis In looking at how the three powers see each other in an Indian Ocean context, it is possible to discern both cooperative and (potentially) confrontational elements in their views of each other. For example, China and the US could be allies in keeping shipping lanes open to ensure the free flow of energy supplies and trade. Both have a common interest in safeguarding the global commons and China is probably very happy to let the US continue to underwrite this task. China and India will become increasingly important economic partners, although the longstanding disagreement over their land borders continues to cast a shadow. With a growing population, India will continue to be an important market for Chinese goods. While they are possible strategic competitors, it will increasingly be in the interests of both India and China to put aside the border dispute to see regional stability maintained. There is the potential for a convergence of US, Chinese and Indian interests, especially in South and Central Asia and the Middle East. All three powers want stability. China is especially mindful of unrest and Islamist activity in Xinjiang and neighbouring states. China is therefore probably quite nervous at the prospect of a post-us Afghanistan. None can afford for Pakistan to collapse and become a failed state. All three countries are dependent on oil and do not want any instability to jeopardise their supply lines. Thus, the national objectives of all three countries converge to a large degree in the Middle East and the Indian Ocean region: all want unimpeded access to shipping lanes, freedom of the global commons, maintenance of the rule of law, and an end to extremist violence. National interests diverge in the South China Sea, however, largely because of its proximity to China; neither India nor the US has a direct territorial interest in the South China Sea (although US allies certainly do). Nevertheless, as a leading flashpoint, this is one of the more likely locations where the US and Chinese maritime capabilities may come face to face in the future. Pax Americana Ad Infinitum? A Chinese View of Relations with the US China s foreign policy suggests that, for the Communist Party leadership, maintaining the Party s supremacy, ensuring internal stability and the maintenance of sovereignty are the top concerns. Achieving the status of a major global economic power is probably next and Page 2 of 12

3 serves to underpin the other all-important objectives. In China, as elsewhere, foreign and domestic policies are interlinked. To achieve those objectives in the context of the Indian Ocean region, China seeks to counter what it perceives as regional US interference and remains concerned by US-Japan, US-South Korea and, increasingly, US-India developments. Beijing perhaps now realises that the more aggressive foreign policy stance of 2010 was counterproductive, in that it pushed many of its neighbours closer to the US. Deeper US security arrangements with the likes of Indonesia and Vietnam potentially contribute another layer to the strategic encirclement so feared by China, and reduce its ability to operate beyond its coastal waters. China also recognises that, should the US withdraw from its global commitments, the ensuing vacuum may not be in China s interests. China is in the fortunate position of being able to free-ride on the regional security architecture and stabilisation work that is underpinned by the US. Given the financial commitments required, which would compete with domestic concerns, China may be unwilling to undertake such a role in the future. After all, while emerging powers may clamour for greater global influence, they often oppose the political and economic ground rules of the inherited Western liberal order, seek to transform existing multilateral arrangements and shy away from assuming significant global responsibilities. 1 [Emphasis added by author.] The US, on the other hand, remains committed to underwriting global security, but stresses that new and emerging powers who seek a greater voice and representation will need to accept greater responsibility for meeting global challenges. 2 In the case of China, it may prove to be a fine line between those in Washington who see Beijing as continuing to free ride and those whose who will inevitably view China as going too far and attempting to usurp the US. Equally, the leadership in Beijing will be similarly caught between those who wish to see China demonstrate its peaceful rise, by playing a greater role in international security without directly confronting the US, and those who advocate a much more assertive policy under which China claims the mantle of leadership from the United States. Both China and the US share a common interest in keeping trade and energy flows open. On a deeper, more structural level, however, they may also, in the future, experience friction over attempts by Beijing to tilt international financial and trade norms in favour of Chinese (state-owned) businesses. As Elizabeth C. Economy of the Council on Foreign Relations notes, within the International Monetary Fund Beijing continues to press the IMF to move away from the US dollar as the global reserve currency in favour of a basket of currencies. It also seeks the amendment of a number of IMF practices under which China regularly receives criticism, such as reviews of states currency policies, transparency levels 3 and Beijing s mercantilist policies. As Economy points out, China s growing economic strength will only enhance its ability to agitate for change in the coming years. The US, along with 1 Patrick, S., Irresponsible Stakeholders? The Difficulty of Integrating Rising Powers, Foreign Affairs, Vol. 89, 6, November/December 2010, p National Security Strategy, 2010, The White House: Washington DC, p Economy, E. C., The Game Changer: Coping with China s Foreign Policy Revolution, Foreign Affairs, Vol. 89, 6, November/December 2010, p Page 3 of 12

4 other Western states, can be expected to oppose such changes. If they were ever implemented, they would be seen to undermine the mechanics of the Western-led system and to unfairly advantage China. An Overlooked Competitor? Sino-Indian Relations: The View from Beijing There is little doubt that China increasingly is aware of the Indian Ocean and the protection of its sea lines of communication. To date, however, Beijing has been prepared to use soft power, especially diplomacy, investments, loans and aid, rather than overt military force. In part this may be an attempt to convince India that it does not need to invest heavily in military capabilities, especially naval forces. But China s soft power may also be a means to develop and deploy military forces in the region quickly, should this be considered necessary. Another view, however, is that China is deliberately using soft power to extend the US and India into expending more resources in confronting it. Beijing may also be using such a strategy to isolate India. If this is the case, then there is considerable risk involved, as the US may counter such moves by offering increased military support to India and, possibly, Japan and South Korea. China will probably therefore seek to pursue a balancing act between containing a possible rival and competitor for influence and resources and encouraging an increasingly important trading partner. Beijing will also attempt to ensure, as much as possible, that the India-US relationship does not develop into an anti-china containment strategy. It will also seek to encourage trade and other relationships that might encourage India to adopt pro-china policies. Also on the agenda are likely to be efforts to prevent conflict over potential border disputes and encouragement to India to downplay support for Chinese dissident groups, especially those related to Tibet. Incursions by Chinese troops across the Line of Actual Control into Indian-held territory might therefore be expected to diminish accordingly. Beijing will also aim to ensure that India at least understands, even if it does not support, China s intention to be recognised as an emerging world power, especially in the economic sector. As India continues its upward trajectory, growing in confidence as a regional power with expanding bluewater naval capabilities, awareness of India in China can only increase, in contrast to its traditional neglect of the South Asian giant. At once warily watching each other s growing military capabilities and involvement in countries such as Sri Lanka and Burma, China and India nonetheless have a common interest in regional security, particularly stability in Pakistan and Afghanistan. On the border issue, while standoffs and even incursions are still likely from time to time and both sides are boosting their military capabilities along the disputed frontier, an outbreak of sustained hostilities appears increasingly less likely. Despite comments from the media, blogosphere and even certain sections of the establishments in both countries, Beijing and New Delhi both appear to recognise the benefits of managing tensions. Page 4 of 12

5 What may change is the relative degree of emphasis placed on such efforts following the next Indian general election in 2014 and, in China, the leadership transitions beginning in The latter are expected to see President Hu Jintao and Premier Wen Jiabao replaced by so-called fifth-generation princelings. The leading contenders, but by no means absolute certainties, are Xi Jinping, as the successor to Hu, and Li Keqiang, to step into the role of prime minister. While much remains unknown about the policy positions of any of the possible contenders, their backgrounds, and those of many of their respective underlings Xi as an engineering graduate and Li in law and with a PhD in economics should, together with the overwhelming importance of stability, see China pragmatically attempting to secure its future by working with India and the US to the greatest degree possible. Rival and Peer Competitor: China Seen from New Delhi In positioning itself to emerge as the dominant Indian Ocean power in the decades ahead, India is attempting to ensure that China does not gain a significant strategic foothold in the region. The Sino-Indian rivalry is, in many ways, and particularly within India, socially constructed. It is a rivalry that is perhaps more in the minds of the populace, the media and strategic thinkers than it is in the minds of India s leaders. There is competition between China and India but, at the same time, India s leaders do not talk about such a rivalry. That is because they recognise that, in a globally integrated, interdependent economy, India and China need to work together. With work, the two Asian giants have the potential to be important markets for each others' products. The two countries renewed interest in border talks the fifteenth round of which took place in January 2012 indicate renewed efforts at, and the need for, management of the dispute. There appears to be a growing awareness that better management of the issue would benefit both countries by contributing to greater stability, thus allowing both to look to the sea and focus on expanding their naval capabilities. Given the sheer size of the disputed territory, however, and the national fervour it can stir up on both sides of the border, a complete resolution of the dispute before 2020 appears highly unlikely. Better management nonetheless offers a way forward. The so-called String of Pearls, referring to Chinese port projects across the Indian Ocean, is a notion that caused great consternation in India; if not in government circles, at least in the military and the commentariat. While the String of Pearls is now widely recognised as a fanciful construction and suspicions of Chinese military bases on Burmese islands have proven to be untrue, a rising China remains at the forefront of Indian strategic thinking. India s ambitious naval expansion programme is a clear response to China s return to the waters of the Indian Ocean a body of water seen by many in India as India s rightful sphere of dominion. Page 5 of 12

6 Watched carefully by China, an expanded Indian navy is not automatically a problem for regional security. It could, in fact, aid stability via increased confidence-building measures and anti-piracy operations; the US and China have shown that potential rivals can work together in that regard. An expanded Indian navy could undertake a greater range of port calls in support of New Delhi s Look East policy potentially unsettling China but the two navies are most likely to rub up against each other at the entrance to the Malacca Strait. Dominating the entrance to the strait, the Andaman and Nicobar Islands are prize pieces of strategic geography. They give India a forward presence astride a chokepoint that is of vital importance to China's energy and trade flows. Given the concern in New Delhi caused by China s naval expansion to date, a People s Liberation Army Navy regularly patrolling key sea lanes in the vicinity of Indian territory will no doubt cause further concern. In a worst-case scenario, it might even lead to a classic security dilemma as both countries second-guess each other in seeking to match the other s capabilities and intentions. More likely though, while a certain amount of posturing, and even provocation, may occur, both New Delhi and Beijing recognise that another outbreak of actual conflict is not in the best interests of either country. India is due to hold a general election by At present though, both the governing Indian National Congress party-led United Progressive Alliance and the opposition National Democratic Alliance, headed by the centre-right Bharatiya Janata Party (BJP), are floundering in the polls. This could set the scene for the emergence onto the national stage of charismatic and controversial Gujarat Chief Minister Narendra Modi as BJP leader and possible future prime minister. In the event of a BJP win, its more nationalistic foreign policy may see the abandonment of initiatives such as the border talks with Beijing and increased tension in India s relations with China. India s relations with the US would be prized, however. In the event of a Republican Party win in the US presidential elections, they could draw even closer; a development likely to cause concern in Beijing. On the other hand, Modi led a successful Gujarat state government delegation to China in November He has also been criticised by Washington for his lack of action in stopping the 2002 anti-muslim riots that broke out across Gujarat, with almost 1,200 deaths. Some commentators have speculated that the China trip offered an indicator of Modi s view as to which country would be the superpower of the twenty-first century. A future Modi Government, merely a possibility at the moment, might not automatically follow traditional BJP foreign policy. The Eagle and the Tiger: India's View of Indo-US Relations The implications of the 9/11 attacks against the US have bolstered India s utility as an important ally to the West in combating Islamist terrorism, which also poses a threat to India s interests. India has thus benefited from intelligence sharing, technology transfers, Page 6 of 12

7 military cooperation and exercises, which have been beneficial to India s defence and security interests. At the same time, however, 9/11 caused other problems for India, by re-invigorating the US- Pakistan relationship. The subsequent deterioration in US-Pakistani relations may come to work very well in India s favour. New Delhi may seek to contrast itself with Islamabad in Washington's eyes by highlighting its democratic credentials, its reliability as a strategic and trading partner and their shared concerns over a rising China. On the other hand, while enjoying the benefits of a warmer relationship with Washington, India will not wish to be beholden to the US and will seek to maintain something of its traditional non-aligned foreign policy. The purchase of military equipment from longstanding supplier Russia can thus be expected to continue, as will sometimes tepid support for US initiatives. The decision to purchase more oil from Iran at a time of expanded US (and European Union) sanctions against Tehran, should be seen in the context of India pursuing its own national objectives, rather than embracing those of the United States. A China Crisis? How Does The US See The Middle Kingdom? The question of how to cope with the rise of China is at the core of much of US policy in the Indo-Pacific region. In view of President Obama s reorientation of US defence policy towards the Asia-Pacific, this is now very much the case. The emphasis since 2008 has been on partnerships and attempting to gain Chinese commitment to existing international norms. Initiatives such as the US-China Strategic Dialogue have been at the forefront of such efforts. At the same time, however, the US appears to be hedging against China. It is doing so by maintaining alliances with key partners and returning its strategic emphasis to the Asia- Pacific, as US commitments in Afghanistan wind down and the relationship with Pakistan continues to sour. Looking out to 2020, and making allowances for the outcomes of intervening presidential elections, these two approaches are largely likely to continue. Of course, exactly how the US might adjust to having to share more of the international space with a rising China, and what the US actually views as being China s legitimate interests in the Indian Ocean and Asia- Pacific regions, remain uncertain. If not managed well, friction could result from China s military build-up and increased assertiveness regarding Taiwan, Japan, South Korea and the South-East Asian countries, particularly in the South China Sea. For the US, this reinforces the need to maintain its partnerships with the likes of Australia, Japan, South Korea, Singapore, Thailand and, now, Vietnam. It represents a return to the Asia-Pacific region and a decreasing focus on the Indian Ocean region, although US interests in the Middle East will ensure that region does not disappear off Washington's radar. The shifting of the US defence focus (back) to the Asia-Pacific region and the basing of US marines in Darwin, are best seen in that light, but they nonetheless offer a view of things to come. Page 7 of 12

8 Given that China s interests in the Indian Ocean region (and beyond) are, in most instances, broadly the same as those of other countries, the potential for future co-operation exists and the US is interested in pursuing it; co-operation builds confidence and, if nothing else, is cheaper than doing it alone. As China and the US (and India), all have too much to lose from a conflict, efforts although sometimes clumsy will be made to manage differences and prevent them from escalating. But, China may be unwilling to commit too deeply. While it wants the region s sea lanes to be secure and is acutely conscious of its vulnerability in that regard, there are few, if any, signs that Beijing would be willing to act as guarantor of the global commons in the way that the US does. In many cases, just getting China to discuss the issues can be difficult, although counter-piracy co-operation in the Gulf of Aden, as noted above, proves that Sino-US cooperation on regional strategic issues is possible. It also gives China an opportunity to demonstrate to Washington its credentials as a responsible international citizen. Equally important is the fact that, just as the US has an economic interest in China, the US is of tremendous economic importance to China, which therefore has an interest in a US economic recovery. A conflict would harm the economies of both countries. It is worth remembering, however, that while the above relates to the wider Indian Ocean region, matters are very different in the South China Sea, even though the US itself is not directly involved except insofar as it is a guarantor of the global commons and the other claimants are all US allies to one degree or another. While somewhat peripheral to this study, it nonetheless has relevance because, for China, the issue is frequently viewed through an existential prism of encirclement and a perceived threat to territorial security. Nationalism, possibly stoked by the Communist Party itself, will only serve to inflame Chinese sensitivities. The US, on the other hand, will be very much concerned by China s continuing acquisition of capabilities that will ultimately serve to deny American aircraft carriers access to areas such as the South and East China Seas and beyond. The willingness of the United States partners to keep the US engaged in the region, may offer Washington an ideal opportunity to pursue the notion that its partners must do more, while it continues to provide a security umbrella. More bases in this region are unlikely the US and its partners will be unwilling to raise the ire of China but the concept of places, not bases is well suited to both the area and the financial circumstances of the US. Although the US has no intention of withdrawing from this region in the next decade, it will look to refine its assets in the region for optimum efficiency and impact. Indeed, it has already begun to do so, as the deployment of US Marines to Darwin demonstrates. In view of the fact that 2012 is an election year in the United States and that the victor if other than President Obama could occupy the White House until November 2020, how might the US view China and India in the light of the policies of the Republican Party contenders for the 2012 presidential election? Presumed to be the eventual Republican presidential candidate, Mitt Romney appears extremely wary of China. A future Romney Administration clearly sees China as a rival that needs to be managed, coerced and contained. Various actions must be taken by the US in Page 8 of 12

9 closing off China s option of expanding its influence through coercion. 4 China (along with Russia), has harmful ambitions, which must be checked as it is encouraged to transform itself into a decent and democratic political actor. 5 In an attempt to retake some of the conservative high ground, Romney is using a carrot-andstick approach, in which the carrot has effectively been discarded. Under a Romney presidency, the US would encourage China s continued integration into the (US-led) international system by the presence of increased military forces in the western Pacific, a new regional free trade area and vigorously supporting those civil society organisations within China pressing for change. Deeper relations with India, Indonesia and Taiwan are foreshadowed, as a means of closing off China s option of expanding its influence through coercion. 6 To Beijing, that will all sound very much like containment. The US will certainly continue to have a visible presence in the western Pacific-East Asia area, as Romney has proposed a reversal of Obama's defence spending cuts, a minimum core defence expenditure of four per cent of Gross Domestic Product per annum and the construction of around 15 ships per year. Romney s proposals are envisaged as a means of safeguarding the global commons and regional prosperity from the China threat : the United States and our allies must maintain appropriate military capabilities to discourage any aggressive or coercive behaviour by China against its neighbours. Regardless of any difficulties in actually implementing them, none are proposals of which Beijing can be expected to approve. Romney has proposed the creation of what he calls a Reagan Economic Zone free trade area, membership of which could be extended to China, even though it is not expected that Beijing would take up the offer. The Reagan Economic Zone is not only designed to ostensibly encourage Chinese participation in regional free trade, it is also intended to limit China s ability to coerce other countries. Given the acceptance right from the start that Chinese participation would be unlikely, a Romney Administration would seemingly be viewing that limitation as a core function of such a zone. With its echoes of containment, it is a proposal that Beijing is unlikely to warm to. China can also be expected to take a dim view of Romney s undertaking to vigorously support and engage civil society groups within China that are promoting democratic reform, anti-corruption efforts, religious freedom, and women s and minority rights. 7 Equally, the commitment to work with Taiwan to determine its military needs... supplying them with adequate aircraft and other military platforms, cannot be expected to go down well in Beijing. 4 An American Century: A Strategy to Secure America s Enduring Interests and Ideals, 7 October 2011, Romney for President Inc.: Boston MA, p Ibid., p Ibid., p Ibid., p. 20. Page 9 of 12

10 While hard power does indeed talk, and some of his policies may even bear fruit, based on the postures outlined in An American Century, Beijing is unlikely to be excited by the prospect of a Romney presidency. It is therefore reasonable to suppose that, under a Romney Administration, Sino-US relations will cool. For India, a Romney presidency would have a largely positive effect on Indo-US relations. Although mentioned just once in An American Century, it was nonetheless in the context of closer engagement between two countries that share a concern about China s growing power and increasing assertiveness. 8 While Romney points out that the objective is not to build an anti-china coalition, the attractiveness of the US as a strategic partner may be enhanced. India, for obvious reasons, would not necessarily be opposed to closer ties with Washington, especially if it were to come at the expense of China. The China policy positions of the other candidates range from Ron Paul s libertarian tradefirst, non-interventionist focus in many ways not dissimilar to China s own approach to Rick Santorum s view of China as a bastion of godless socialism and the neo-conservative view of the world held by Newt Gingrich. Although anything could happen in the Republican primaries and so far it has certainly not been the almost clean sweep Romney supporters were expecting at this stage, at least, Romney still appears the most likely to go up against Obama in November, pitting his foreign policy positions against those of the president. An Increasingly Important Friend: The US View of India Looking out over the next ten years, a more active and supportive India will be a primary US objective in its relations with New Delhi. Washington would like to see India become a more active partner and also more attuned to US interests, such as those relating to Burma, Iran and Afghanistan. The US would be happy for India to play a stabilising role in Afghanistan. The US will emphasise the need for peaceful co-existence between India and Pakistan. It will want India to not only manage, and reduce, tensions with Pakistan, but also to be more accepting of US involvement with Pakistan, even as that may be reduced. It wants Delhi to recognise that it is not balancing, hedging or anti-indian in nature, and that the US must be in Pakistan for its own national security. The US will continue to endorse India as a democratic, economically growing, regional power committed to the rule of law (this carries with it an implicit preference for India to act as a counter weight to China). The intense US diplomatic activity at the Nuclear Suppliers Group (NSG) on behalf of India in 2008, and the June 2011 statement by outgoing US Ambassador to India, Timothy Roemer, that the US and the Obama Administration strongly and vehemently support the clean waiver for India, given to it by the NSG in September 2008, can be seen as demonstrations by the US of its commitment to India. The US can be expected to help India further develop its capabilities to deal with border and maritime issues in the Indian Ocean. This fits comfortably with the notion of burden sharing 8 Ibid., p. 19. Page 10 of 12

11 that the US military is increasingly expected to adopt. India, for its part, has the ambition, but does not yet have the capabilities to achieve it. Possible trilateral co-operation between the US, India and Australia may fit neatly into this context, particularly if broadened to include disaster response management. One model that Australia could offer New Delhi and Washington to adopt in the Indian Ocean region, is the successful FRANZ trilateral disaster relief arrangements conducted in the Pacific by France, Australia and New Zealand. On a defence level, the security quadrilateral that brings together the defence forces of Australia, New Zealand, France and the United States, for the benefit of the wider region, could provide a model. A defencefocussed arrangement would, however, almost certainly arouse suspicions in China of an attempt at creating a three-pronged version of the failed US-India-Japan-Australia Quadrilateral Security Dialogue of Washington will also be seeking to draw India eastwards, into greater strategic engagement with East Asia, thus further cementing its role as a counterweight to China. In this context, the US would probably like to see a greater awareness of India in Chinese strategic thinking not in the sense of being a threat, but more as a brake on Chinese behaviour in the Indo- Pacific maritime domain. This taps into India s own sense of itself as a rising maritime power that is the equal of China. While the US would like to have a closer military relationship with India, it is uncertain whether India will want the relationship to be quite so close. It does appear that the US- India relationship will not be like those that the US has with Australia, Japan or South Korea. It is a relationship which will face uncertainties and, while it will be a friend, it is by no means certain that India will automatically be a close ally of the US in ten years time. What might be more likely is something akin to an interest-specific partnership. India, for instance, may not necessarily be one hundred per cent aware of what the US might want from it as a partner. Negative Indian perceptions of US involvement with Pakistan is one potential stumbling block, though this should lessen as Pakistan s strategic importance to the US decreases at least to some extent after the 2014 drawdown in Afghanistan. Washington, on the other hand, might be a little too optimistic about the degree to which India is willing to commit to US goals. Nevertheless, the US would still like to see India as an active, reliable partner in the Indo-Pacific region. At the very least, the US wants a nonobstructive, neutral India, willing to co-operate with it in regional and international fora. India may therefore be asked to contribute more to the protection of the international system from which it has benefited. There will be times when it will not always suit New Delhi to do so; at others, it will mesh well with India's own strategic objectives and view of itself. The US will want New Delhi to display a greater openness to foreign trade and investment, along with access to India as a market for US goods and services. Of particular interest will be the removal of restrictions on foreign investment in sectors such as retail, defence, agriculture and insurance, all of which have the potential to be significant growth markets for US companies. While a rising India will benefit the US economy, it will also pose economic challenges; for instance, increased competition for white collar jobs. Page 11 of 12

12 In the years to 2020, Indo-US relations will often take an uneven path, but nonetheless they should follow an overall upward trajectory. Further into the future, India may even come to feel confident enough about itself to act as a mediator in some possible Sino-US dispute. ***** Making forecasts is a notoriously difficult undertaking and looking at the future in the Indian Ocean region is no different. While the potential for disagreement, and even conflict, exists, the United States, China and India all have an overriding interest in preserving the security of the region and its key shipping lanes and chokepoints. Although differences will emerge over the structure of the international system and, perhaps, over who should lead it the national interests of all three powers suggest at least a reasonable chance that pragmatism will prevail. ***** Any opinions or views expressed in this paper are those of the individual author, unless stated to be those of Future Directions International. Published by Future Directions International Pty Ltd. Desborough House, Suite 2, 1161 Hay Street, West Perth WA 6005 Australia. Tel: Fax: lluke@futuredirections.org.au Web: Page 12 of 12