17TH ASIA SECURITY SUMMIT THE IISS SHANGRI-LA DIALOGUE SPECIAL SESSION 4 COMPETITION AND COOPERATION IN THE INDIAN OCEAN REGION SATURDAY 2 JUNE 2018

17TH ASIA SECURITY SUMMIT THE IISS SHANGRI-LA DIALOGUE SPECIAL SESSION 4 COMPETITION AND COOPERATION IN THE INDIAN OCEAN REGION SATURDAY 2 JUNE 2018 CHAIR: RAHUL ROY-CHAUDHURY SENIOR FELLOW FOR SOUTH ASIA, IISS MACSUZY MONDON DESIGNATED MINISTER, MINISTER FOR LOCAL GOVERNMENT AND HOME AFFAIRS, SEYCHELLES KAPILA WAIDYARATNE SECRETARY OF DEFENCE, SRI LANKA VICE ADMIRAL (RETD) SHEKHAR SINHA DIRECTOR, INDIA FOUNDATION; FORMER COMMANDER IN CHIEF, WESTERN NAVAL COMMAND, INDIAN NAVY PHILIP BARTON DIRECTOR-GENERAL, CONSULAR AND SECURITY, FOREIGN AND COMMONWEALTH OFFICE, UK SENIOR COLONEL ZHAO XIAOZHUO DIRECTOR, CENTRE ON CHINA AMERICAN DEFENSE RELATIONS, ACADEMY OF MILITARY SCIENCE, PEOPLE S LIBERATION ARMY, CHINA

Welcome, ladies and gentlemen, to this simultaneous special session on Competition and Cooperation in the Indian Ocean Region. My name is Rahul Roy-Chaudhury. I am the Senior Fellow for South Asia based at the IISS in London. This is the first time in the Shangri-La Dialogue that we have a session on the Indian Ocean region and we already have had some discussion on this region. In yesterday s keynote address, India s Prime Minister Narendra Modi noted that the Indian Ocean held the key to India s future. This morning, US Defense Secretary Jim Mattis referred to the symbolic change of name of the US Pacific Command to the Indo-Pacific Command, emphasising the growing importance of the Indian Ocean for the US. Clearly there are key security challenges in the Indian Ocean alongside growing evidence of competition between major powers. In the absence of a regional security architecture in the Indian Ocean, an important question is how its constituent states as well as outside powers can cooperate more effectively in response to these challenges. In this respect, our speakers have been set two exam questions: first, what they perceive to be the major contemporary challenges to the security of the Indian Ocean region, and second, what they feel are the prospects for closer regional cooperation in response to these challenges. But I suspect their major challenge will be to respond to these queries within a time frame of only five to seven minutes each, so that we have enough time for a policyrelevant discussion session. The entire session is on the record. Our first speaker is Minister Macsuzy Mondon, the Designated Minister and Minister for Local Government, Home Affairs, Youth, Sports and Culture of the Government of the Seychelles. Minister Mondon was first appointed as a minister 12 years ago, holding the portfolios of health, employment and human-resources development and education. I am especially delighted to welcome the Minister here as she is the first speaker from the Seychelles in the Shangri-La Dialogue. Minister. Macsuzy Mondon, Designated Minister, Minister for Local Government and Home Affairs, Seychelles Thank you, Mr Chair. Excellencies, ladies and gentlemen, good afternoon. Before I begin, allow me to express my sincere thanks and appreciation to the International Institute for Strategic Studies and the government of Singapore for inviting Seychelles to participate in the 17th Asia Security Summit Shangri-La Dialogue. We recognise and extend our heartfelt appreciation for such a platform for us small island developing states in the Indian Ocean region. Distinguished guests, ladies and gentlemen, the twenty-first century, the opening chapter of the third millennium, has broadened the frontiers for greater possibilities and ushered humanity into a period of great expectations. Driven by the irrepressible forces of digitalisation, globalisation and economic integration, this new era of modernity has a special dimension as it has awoken humanity to the importance of the oceans, both as a lynchpin of the global economy and a key component of international security.

This awakening has made the twenty-first century the century of the sea. The economic concept summarises the importance of the seas to the global economy as the second living domain of the world, while its sister concept of maritime security underscores the importance of securing the maritime domain from all the maritime threats, be they of accidental, natural or illicit nature. This increasing importance of oceans in today s global village has further catapulted the Indian Ocean region to the status of the world s most strategic water mass because of the interplay of economic factors like oil routes, important sea lanes, onshore and offshore assets, and security elements, such as the fragility of some states in that region, the proliferation of organised crime and the existence of hot spots, which lie in conflict areas, which can threaten peace, prosperity and stability. The characteristics of the sea lines of communication, choke points and the development of the onshore and offshore assets will continue to be an important element that will play a major role in defining the region. The connectivity of the Indian Ocean region holds and connects some important strategic port access and choke points such as the Cape of Good Hope, the Suez Canal, the Strait of Hormuz and Strait of Malacca. These choke points provide the necessary arteries for global trade and commerce, in that process creating and opening the Indian Ocean with more opportunities for bilateral and multilateral cooperation. The development of littoral states, the vested interests and the strategic importance of the Indian Ocean region from the external dimension will dovetail the conceptualisation for a common maritime security community. The detailed knowledge of the states and its importance to align with the global world order will be essential to maintain a safe and secure future. The Indian Ocean region faces many challenges which need to be addressed through adopting a common approach and strategy in building regional communities and creating a conducive environment for more cooperation worldwide. Most of the people in the Indian Ocean region obtain 20% to 50% of their animal protein from fish. Over-fishing, illegal, unregulated and unreported fishing is a major concern of ours as it is for any nation with an expanse of water. Illegal, unregulated and unreported fishing and its ramifications for any state, not to mention small island developing states, must not be underestimated. We lose much when such activities occur and further to that, climate change and the impact of environmental degradation poses a serious risk to sustainable economic development. Commercial fishing and local economies based on fisheries are adversely affected with the displacement of native species and extinction risk of the already threatened species. They need to adopt and strengthen national capabilities to deal with the environmental risk, including the risk of oil spills or deliberate discharge at sea, and to have proper mechanisms in place for the segregation of litter, plastic pollution and other forms of solid and liquid waste. The continued effort for more maritime domain awareness will help us to act faster to deter and protect our seas. Diverse non-traditional and traditional security challenges affect the region, ranging from natural disasters to concern over energy security, drugs trafficking, piracy and terrorism to environmental-

risk disasters. This further offers more areas for potential collaboration within states and beyond, with the aim to continue to press on to maintain economic growth, safe passage and transportation of resources, hence intensifying and heightening the ocean s strategic values. The counter-piracy was the most successful manifestation of an active global cooperation. More than 80 countries, organisations and industry groups participated in operations in the Indian Ocean region under the auspices of the UN-mandated Contact Group on Piracy off the coast of Somalia, which Seychelles chaired for two years from 2016 to 2017. Under the new chair of the Indian Ocean Commission, Seychelles remains committed mainly in the Working Group of the Operations at Sea which it is chairing alongside India, United Arab Emirates and with the support of Sri Lanka. It is important to emphasise that as long as there is political instability in Somalia and if international naval operations are reduced in the region, then piracy activity is likely to rise again. Drug trafficking is another major international concern that is undermining the foundation of societies and economies. This includes the Indian Ocean region. Our region has become an area of transit, redistribution and drug use as evidenced by the conclusions of the 2016 Colombo Conference that led to the launching of the Southern Route Partnership. There is a continuing need to redistribute the operational means and enhance existing capacity-building and procedures enforced in the region through appropriate training and joint operations so as to address maritime security and safety threats accordingly. The Indian Ocean region has developed cooperation and collaboration for a wide spectrum of these activities such as the Indian Ocean Rim Association (IORA), which aims at strengthening the regional cooperation and sustainable development within the Indian Ocean region through its 21 member states and seven dialogues. The major interventions of the IORA addresses four primary components trade liberalisation, trade and investment facilitation, economic and technical cooperation, and trade and investment dialogue. The Indian Ocean Naval Symposium, addressing military cooperation amongst regional navies to create the required peace and stability for the region to address maritime security challenges. The South Africa Development Community and Common Market for Eastern & Southern Africa (COMESA) have a standing maritime component for promoting peace and stability for the region through military cooperation. The Contact Group on Piracy off the coast of Somalia plays a leading role in addressing counter-piracy measures, both at regional and international level. The Gulf Cooperation Council promotes military and maritime cooperation among Gulf Cooperation Council countries. The Association of Southeast Asian Nations, ASEAN, promoting security, economic and cultural communities and the Jeddah Amendment to the Djibouti Code of Conduct, which promotes national and regional capacity to address wider maritime security issues as a basis for sustainable development in the maritime sector and also recognising the important role of the blue economy. The Indian Ocean Commission, focusing to strengthen the ties of friendship between the countries and to be a platform of solidarity for the entire population of the Western Indian Ocean region, in particular small island developing states.

Although cooperation involving direct enforcement over the states is less likely, progress can be made through continuous diplomatic efforts and collaboration amongst states. This cooperation can be addressed through, amongst other ways, basic maritime cooperation, like joint search-and-rescue doctrines and anti-piracy patrols; advanced cooperation, such as joint multilateral forces and sharing of information with respect to challenges; and broader maritime cooperation, like joint development of maritime technology and other resources; regional programmes in the maritime space, such as regional cooperation, operation of the Coordination Centre and the regional Maritime Information Fusion Centre, based in Seychelles and Madagascar respectively. There is still an urgent need for reinforced security cooperation between our region and other regions. We need to further strengthen our bilateral and multilateral partnerships. Our region features largely in global geopolitics, primarily due to the fossil-energy factor which is of extreme significance. The balance between freedom of navigation and lawful commerce in the global context will be crucial when addressing the challenges to keep the Indian Ocean region safe and secure. Excellencies, distinguished guests, ladies and gentlemen, we know the time has come for us to mobilise further and to create the expected outcomes in order to keep our region clean, safe and secure for the future generations. As stated by our President, His Excellency Danny Faure, Maritime security is an extremely important component of the sustainable development of the ocean economy. But because of our limited and competing resources, it is particularly important that we have a wellthought-out maritime security strategy. And this is thus our commitment and we welcome any cooperation that may be extended in this regard. Hence why we believe it is imperative to solidify our common approach so that by our continued efforts, peace, stability and prosperity for all can be achieved. I thank you for your attention. Thank you very much, Minister, for your comments. Let me quickly turn to our second speaker, Mr Kapila Waidyaratne, who is the Secretary of Defence of the government of Sri Lanka. Appointed as Defence Secretary last year, Mr Waidyaratne was formerly the Senior Additional Solicitor General of the Attorney General s Department of Sri Lanka. Kapila Waidyaratne, Secretary of Defence, Sri Lanka Good afternoon. Chairman Roy-Chaudhury, thank you very much. Distinguished guests, ladies and gentlemen, let me first congratulate and thank IISS for the 17th round of the Asia Security Summit, the Shangri-La Dialogue. I am both pleased and honoured to have received your invitation for the fourth session of the dialogue which is themed Competition and Cooperation in the Indian Ocean Region. Given the importance and prominence of the Indian Ocean region and its strategic landscape in geopolitics, the theme of the session is time-worthy in the backdrop of the Indian Ocean region s role in what several call the Asian Century.

The strategic importance of the Indian Ocean region depends on its major sea lanes of communication, which act as a catalyst for connectivity among resource-rich and resource-seeking nations. Hence it is vital that maritime boundaries and resources are secured in the region, and it is preferred that such protection should emanate from within the region rather than external sources. Today it is evident that traditional as well as non-traditional power blocs continue to compete in the Indian Ocean region in a bid to secure their position in the highly dynamic and complex environment leading to a more multipolar Indian Ocean. These regional and extra-regional powers build up their military power stealthily in a competition to outgrow each other s presence in the region for strategic and resource purposes. Chairman, alongside this greater competition in terms of regional and extra-regional powers, in their attempt to get a foothold in the region, there are challenges in terms of transnational organised crime, manifested through drug smuggling, human trafficking, terrorism, piracy and so on, which are all interrelated and sponsored by violent non-state actors who seek to destabilise the region for their own benefit. Thus the Indian Ocean provides us with a unique environment to compete not against each other, but alongside our regional as well as global partners, so that we are all capable of addressing some of the major threats and challenges in the region. The rapidly changing maritime nature and the complexities of issues are not only limited to the Indian Ocean. For example, the vastness of the ocean presents us with an immense challenge of monitoring. Despite capacities and capabilities, this has become quite a challenge for all the navies and the coastguards. The inability to keep a close eye on each and every square kilometre of the ocean makes it a vulnerable domain. This inherent character makes not only the Indian Ocean, but all the other ocean spaces around the world, vulnerable and attractive for non-state actors. Ladies and gentlemen, not having a visible enemy out at sea does not mean our oceans are safe and secure. The challenges that we face today are highly complex and interconnected, posing serious security threats. I am sure the maritime security experts present here will agree with me that addressing these challenges in the maritime domain are more complex than fighting a visible enemy. It is equally important to note here that the diverse, non-traditional security challenges in the Indian Ocean region also offer areas of potential collaboration for regional as well as global partners. We have seen a diverse set of maritime security threats and challenges in the Indian Ocean region. These challenges remind us of the importance of finding solutions, not in isolation but in cooperation with all of our partners and stakeholders. Ladies and gentlemen, by looking at the complexity of the issues one could clearly see that we as a region require taking a serious look at some of the existing multilateral mechanisms to ensure that the Indian Ocean region issues are looked at through a holistic strategy, giving prominence to cooperation and coordination over negative competition. Indian Ocean nations should play an active role as a contributor to maritime security in the Indian Ocean region, especially given the risk of emerging-power tension in the Indian Ocean region.

Apart from many other issues in the Indian Ocean region, I strongly feel that it is essential to have in place a strong governance mechanism to ensure that the regional maritime affairs are governed in accordance with the accepted rules and regulations. As we heard yesterday, as Honourable Prime Minister Modi said in his keynote speech, we in this endeavour [to pursue] an all-inclusive strategy without excluding any actor. Any actor is important. Only such a mechanism will ensure freedom of navigation, adherence to a rules-based order in the Indian Ocean region. One can have the most powerful navy, the coastguard, advanced technology; yet the present context demands each and every stakeholder to cooperate and coordinate with each other. Chairman, this is exactly why all of us here, big or small, developed or developing, need to work in unison to address common threats and challenges in the Indian Ocean region, while welcoming healthy competition. Trust confidence what we hear most of the time the trust confidence that we place on our partners has the ability to make a major difference in implementing initiatives that will help keep the Indian Ocean region safe and secure. The trust deficiency existing in the region poses a larger challenge to peaceful cooperation among states and non-state actors, which we must overcome. I believe in this endeavour it is important to invest in research and [inaudible] platforms to focus the trends when facing the twenty-first-century maritime challenges and facilitating cooperation in the Indian Ocean region. Today what you and I do in the Indian Ocean region has the ability to make a significant impact on the destiny of the entire world. Not only our survival, but the entire world depends on the Indian Ocean. Therefore, we have no option but to get away from unhealthy competition and focus on effective implementation of all-inclusive maritime security strategies to address the Indian Ocean region issues. Thank you for your attention. Thank you, Defence Secretary. Let me now turn to our third speaker, Vice Admiral (Retd) Shekhar Sinha, who is the Director of the India Foundation. Admiral Sinha retired after 40 years in service in the Indian Navy in 2014 as the Commander in Chief of the Western Naval Command based in Mumbai with additional responsibility of Commander in Chief, Coastal Security, Western Seaboard. Prior to this, from 2010 to 2012 he served as the Chief of the Integrated Defence Staff. Vice Admiral (Retd) Shekhar Sinha, Director, India Foundation; Former Commander in Chief, Western Naval Command, Indian Navy Thank you, Chair, and thank you, IISS, for giving this opportunity to share the panel with such distinguished speakers. Good afternoon, ladies and gentlemen. I am discouraged to speak for long because I notice that the Chair is passing the slips quite often. Well, coming to the issue of the competition and cooperation in the Indian Ocean, the discourse of the larger Indo-Pacific has now resulted in renaming of the US Pacific Command to Indo-Pacific Command. It reflects the United States commitment to stay relevant in this vast expanse of the

confluence of the seas. It also puts to rest the notion that the US is a declining power and does not have interest in this area. You would recall Prime Minister Modi s articulation last night where he said that we do not wish to make competition into conflict, but turn it into cooperation. And we must not return to the greatpower rivalry. This is precisely what our very distinguished, my predecessor speakers have said. He also mentioned how the Indian Navy has been participating in cooperation in the Indian Ocean region (IOR) for many years. The Indian Navy s maritime strategy is a written document and it lays down the role it envisions for itself from the Straits of Malacca to the Straits of Hormuz in the north Arabian Sea, and extending down to Bab-el-Mandeb and the Horn of Africa. While the Eastern Indian Ocean has been a relatively quieter region, it is the Western Indian Ocean that is, the Arabian Sea, both the Gulfs and the African coast which have seen much action, and unfortunately in the Indo-Pacific construct, this area remains neglected of the US attention. The nontraditional threats such as piracy, terrorism, transnational crime were mentioned. Narcotics trafficking, arms smuggling, illegal fishing, seabed exploration, non-combatant evacuation following man-made disasters: these are some of the human sufferings which have taken place in this area and they remain outside the ambit of the broader Indo-Pacific framework that I talked about. India, being the largest country and with a reasonably formidable navy, has been the first responder in the region for many issues, by and large. The global energy trade in the IOR sea lanes of communication (SLOCs) has also resulted in the presence of extra-regional naval ships. The presence of these large numbers of combatants also gives rise to chances of accidental or unintended encounters, and therefore the Honourable Minister talked about the standard operating procedures (SOPs) which need to be laid down for working principles. The development process in the Eastern Indian Ocean and adjacent littorals has made the countries even more energy-hungry. Countries like China, Japan, South Korea, India are largely dependent on their trade traversing through the IOR sea lanes, having traversed through restricted straits, which he had mentioned. Securing these sea lanes is in the common interest of all countries and I do not find anything else but to cooperate. The Indian Navy has created a web of surveillance networks to improve maritime domain awareness (MDA) and share it with IOR countries. It uses all kinds of platforms and satellites to develop the MDA. In the absence of a formal regional security architecture, it has established bilateral and a few mini-lateral arrangements by way of joint exclusive economic zone (EEZ) surveillance using physical patrolling exercises, laying down the SOPs, electronic monitoring and exchanging white-shipping data and intelligence as well on all the maritime targets. If you recall that on 4 December 2017 last year during the Navy Day, the Indian Chief of the Naval Staff stated that the naval ships, submarines and aircraft are on mission-based deployment 24/7 at all the restricted passages where non-traditional security risks to the shipping are very high. It also provides flexibility of using these combatants to respond to the natural disasters in that area very

quickly. These platforms always carry the humanitarian assistance and disaster relief (HADR) stores every time they leave harbour. The countries in the IOR who have agreements with India have developed SOPs to operate together. These agreements also serve as confidence mechanisms amongst the participating countries and transparency of operations. Recently, for the first time, the Indian Ocean Naval Symposium (IONS) is discussing an enabling mechanism to establish a common security framework. India s own northeastern states development is closely linked to actors foreign policy. The trade and maritime security cooperation with ASEAN is witnessing an exponential rise. Joint development of ports, logistics-support agreements for each other s ships and aircraft is an effort in that direction of shared security. India s recent agreement with the UAE, with the Gulf countries, Mauritius, Seychelles, Madagascar has provided an opportunity for larger participation and quicker response to traditional and non-traditional maritime threats. As you heard the Indian Prime Minister yesterday, he mentioned security and growth for all in the region, so he clearly establishes a link between economy and security. And the navy deploys its ships and aircraft in the spirit of that protection. The visit of Prime Minister Modi to Wuhan also demonstrates the initiative and effort being made to take China in the fold for stability and peace in the region to ensure free movement of legal commerce in accordance with the rules-based international order. The Indo-Pacific is a large area and does have a number of mini- and multilateral arrangements to muster adequate assets. Creating any new organisation would only add to the list of dysfunctional organisations. We need to strengthen the existing organisations, such as IONS and IORA, and redefine shared responsibilities of the countries. The capacity-building in those countries will have to commensurate with the threat perception. India and Africa along with Japan are also in the process of setting up such cooperative mechanisms. Countries with larger assets would have to commit greater support to the framework. Although all the littorals have not yet come on a single platform, the Indian Navy and navies of this IOR littoral have established bilateral arrangements of security in the area wherever there is a shortage of assets. I have been often asked this question, Can the EU play a role, or can Great Britain play a role? My answer is yes, you can build the capacity of these countries, create the domestic manufacturing industries and transfer the technology so that it can also create jobs. The second question I am asked is, Does India see any maritime cooperation with China in the near future? Now, being an operator and a person who has been so many years at sea, I have always said that there is nothing but cooperation which India and China have to do if they have to protect their own energy security through the IOR. It will happen. In fact, in 2015 the agreements signed between President Xi Jinping and Prime Minister Modi, one of the areas is maritime cooperation. Nothing has

happened so far but I am sure that it is a work in progress. A lot of paperwork at the unofficial levels are being done. If we do not contribute and if we do not cooperate, then each country will have to create a large number, a chain of military bases the world over for its own security, which is not possible. If you recall Admiral Mike Mullen, he mentioned about a thousand-ship navy in the world and he talked about basically countering these traditional and non-traditional threats, and one country cannot do it and that is precisely what his articulation was. India has also attempted a Bay of Bengal initiative. India stands as a pluralistic power in the IOR, which means decision-making by the widest spectrum of participating countries in the region. It does not impose its power exclusiveness. The focus remains on free movement of legal commerce following a rules-based international order, and yet develop capabilities and help create capabilities to resist any revisionism to the rules-based international order in the region or to cope with competition turning into confrontation accidentally or intentionally. Thank you. Thank you very much, Admiral Sinha. Let me turn to our next speaker Philip Barton, who is the Director-General, Consular and Security at the Foreign and Commonwealth Office in the UK. Philip was the Deputy British Ambassador in Washington, the British High Commissioner in Pakistan and most recently the Acting Chairman of the Joint Intelligence Committee. Before that he was a highly valued colleague on South Asia affairs on secondment to the IISS as a Consulting Senior Fellow. Philip also served as Private Secretary to two British prime ministers, John Major and Tony Blair. Philip Barton, Director-General, Consular and Security, Foreign and Commonwealth Office, UK Thank you very much, Rahul, and good afternoon, ladies and gentlemen. Let me start by thanking you and all your colleagues at IISS and the government of Singapore for another superb Shangri-La Dialogue. I know, Rahul, you have long been a proponent of more focus on the Indian Ocean so I am really pleased to join you on this panel today and noted what you said at the beginning about this being the first one. What I would like to do is just spend no more than five or six minutes, as you asked, giving you a UK perspective around what I think we see as the security challenges in the Indian Ocean, the way in which the UK is trying to contribute and then turning to your exam question, Rahul, around how we might see enhanced regional cooperation. The reason why this is important to the UK is that we are a global free-trading nation and the freedom of maritime routes is crucial to our prosperity and security. And to illustrate that, it is worth noting that 80% of the UK s natural-gas imports, which are a key component of our energy security, pass through Indian Ocean sea lanes. So clearly how those sea lanes are managed and operated and kept secure is vitally important to us for security reasons.

In terms of the challenges, I agree with a lot of what has already been said by the panel. On the security side, I think first and foremost, particularly in the Western Indian Ocean, we have seen high levels of piracy. It is of course around choke points. I think it has been effectively suppressed but it is not eradicated, and if you look at the infrastructure in Somalia, it is still there. So there is a risk that it could return. Secondly, I think there is a growing risk of terrorism. The threat is evolving, it is becoming more sophisticated and I think we are seeing it increasingly targeting maritime assets. And thirdly, as also has been mentioned already, there is organised transnational crime, and I would highlight in particular the trafficking of people and of drugs. In terms of the UK contribution, we have played a leading role in the EU s naval mission to suppress piracy off the Somali coast. I think it has been a success. In January 2011 there were 736 hostages and 32 ships being held by pirates. By October, at the end of 2016, there were none, although I think the risk of re-emergence, as the Minister said at the beginning, remains. Secondly, we have established a UK Maritime Trade Operation (UK MTO) in the Western Indian Ocean which provides advice to shipping and is a first point of contact in the event of piracy and that is available to any flag. And to illustrate that, in a 24-hour period in November last year, 76 Indian ships reported to the UK MTO their presence in the region for reporting purposes. We are a major contributor to the combined maritime task forces in the West. We are reopening our naval base in Bahrain, which will increase our ability to supply naval assets into the Indian Ocean. And finally, we exercise regularly with the Indian Navy. We have partnerships with the other maritime authorities and powers in the region bilaterally. We help with security. We are involved in the security of ports and so on. So the UK is trying to play its part in making the Indian Ocean more secure, working with our partners in the region. The second big challenge I see is around the environment. I echo very much what the Minister said at the outset. We see this in terms of the impact of climate change on sea levels and on temperatures of the sea. I think it particularly affects the Maldives, Bangladesh and the Seychelles. We see the impact of over-fishing which is not sustainable and affects livelihoods. What we the UK are trying to do is to lead by example in this area. So we have made the British Indian Ocean territory the world s largest no-take marine protected area, which means that there is an obligation to minimise human disturbance. Finally, and Rahul, to get to what you set us as an exam question around regional cooperation and how it might improve, I think the biggest challenge is the lack of an organising vision and the lack of a unifying set of principles around which everyone can mobilise their collaboration. I think we heard earlier on a description of the regional architecture of groupings like the IORA, the Indian Ocean Commission and so on, and all of those play a valuable role. But I think they are overlapping and if we are honest with ourselves, I think they are probably less than the sum of their parts. And I think the starting-off point should be to think about what our vision is, what are the principles around which all of us can agree, both the countries of the Indian Ocean but also others, that we can mobilise and have at our call.

I think the interesting thing for me about the Dialogue here in the last couple of days is the congruence between what we heard from Prime Minister Modi last night and what Secretary Mattis said this morning. I think that is beginning to set out a set of principles which certainly we the UK would support and which I think is a way in which we can think about how we can improve regional cooperation in the Indian Ocean region, the principles of freedom, of openness, of inclusivity which we have also heard from other panel members earlier on this afternoon. And what this means in practice is respect for international rules, an international rules-based system, as the Defence Secretary of Sri Lanka made clear, including of course the law of the sea and freedom of navigation. If we can agree all of those, I think we will begin then to be able to have a more coherent and more significant effort to look at the security challenges of the region. Finally, I think there is a big thing around connectivity. This was a theme of Prime Minister Modi s speech last night. Clearly there is a very significant need for increased investment, in particular in transport infrastructure. The statistics around the lack of infrastructure investment in the region are very striking and that lack of connectivity does limit economic growth throughout the region. So investment to increase this connectivity should be and is welcome. But again, I think those investments need to be in line with the principles I have talked about. So they need to meet international standards on transparency and good governance, so they need to be sustainable. And that is the basis on which we, the UK, engage with our international partners on regional connectivity programmes. So in conclusion, Rahul, I think there is a lot of good cooperation already in the region. But I think if we can agree a set of principles around how we think about the region and how we enhance regional cooperation, I think that will improve the security and prosperity of everybody. Thank you. Thank you very much. Let me now turn to our final speaker for this session, Senior Colonel Zhao Xiaozhuo, the Director of the Centre on China American Defense Relations of the Academy of Military Science of the People s Liberation Army, People s Republic of China. Colonel Zhao s major research interest covers China US military and security affairs, South Asia studies and the revolution in military affairs. He has published several books including, in 2002, a book called A Perspective on the Indian Armed Forces. Senior Colonel Zhao Xiaozhuo, Director, Centre on China American Defense Relations, Academy of Military Science, People s Liberation Army, China Thank you, Chairman. Good afternoon, ladies and gentlemen. First of all, let me thank the IISS for inviting me to the very important session Competition and Cooperation in the Indian Ocean. The Indian Ocean, we know, is of great significance geographically and geopolitically. Meanwhile, the Indian Ocean is one of the regions in the world full of resources. Not only oil and natural gas, but also non-ferrous metals and mineral resources. Against this backdrop, great powers pay much attention to the Indian Ocean, with cooperation on one hand and competition on the other. It is true

that between powers there are mistrust and even confrontation, competition for influence over medium and smaller countries, and even a struggle of control against counter-control at sea. However, in my opinion, the competition between great powers, particularly the competition from China, has been heavily overstated. So, I think the common interests in the Indian Ocean between outside powers are far more than their differences. We should pay much more attention to the cooperation rather than competition. Firstly, let s look at China s strategic interests in the Indian Ocean. I think peace and cooperation define China s largest strategic interest in the Indian Ocean. The Indian Ocean has been increasingly more important to China. The strategic interests of China in the Indian Ocean can be found in the following areas. The first interest is resource security, particularly oil security. Now, China is the largest oil consumer and the largest oil importer in the world, whereas the Indian Ocean is full of oil and natural gas. Over the past years, the Persian Gulf has been China s largest source of import for oil, and the total amount imported from the Persian Gulf accounts for half of China s total. The second interest is the security of the trading routes. Now, China is the largest trader in the world, with a dependence on foreign trade of over 80%, and 90% of the foreign trade is transported from the sea. It means that sea lines of communication are of extreme significance for China. The oil transported in the Indian Ocean accounts for 80% of the total imported to China and the trade transported in the Indian Ocean accounts for 40% of the total for China. So, it is no exaggeration to say that the rapid development of China s economy is based on a booming trans-indian Ocean trade. The third interest is the security of China s western borders. Since the western part of China is located near the heart of Eurasia, its security, particularly the stability and the development of China s western border areas, is directly affected by the stability in the northern rim of the Indian Ocean. And the last interest is the safety of people. With the integration of China and the outside world, more and more Chinese go abroad as businessmen, students and travellers. The rim of the Indian Ocean has become one of the important destinations, with more than one million Chinese in the Indian Ocean countries. Due to the turbulent situation there in this region, the events of Chinese being kidnapped, robbed and killed happen from time to time. Secondly, let s look at other powers strategic interests in the Indian Ocean. I think peace and cooperation also define other powers common strategic interests in the Indian Ocean. The security situation in the Indian Ocean is not only China s concern but also the concern of other powers. The strategic interests of other powers can be found in the following areas. First, to ensure the security in the Indian Ocean as the international passage of trade. Since India is the regional power in South Asia, its booming economy relies heavily on the sea lines of communication in the Indian Ocean. Although the US economy does not rely much on the Indian Ocean, its allies and partners such as Japan, the ROK and Thailand, the Philippines and Singapore rely heavily on the routes in the Indian Ocean.

Second, to ensure the security of the oil supply from the Middle East. India is short of oil, with more than 70% of its energy imported. As its energy demands increased in recent years, India takes the Middle East as its main energy source. Although the United States oil dependence on the Persian Gulf shows a declining trend due to its energy development in the American continent, crude oil from the Middle East is still indispensable for the US economy. Nearly all the crude oil demanded by Japan is imported, with 70% coming through the Indian Ocean. And the last interest of other powers is to respond to non-traditional security threats. The Indian Ocean is a region where not only various non-traditional security events frequently occur, but also international terrorism and extremism join each other. Many countries in this region suffer terrorism, with the economy and the lives of the people seriously affected. In addition, natural disasters often hurt the Indian Ocean countries, where 70% of natural disasters in the world occur. So, as analysed above, my conclusion is that a peaceful, stable and prosperous Indian Ocean is not only in the interests of the people in the region, but also in the interests of outside powers. Therefore, cooperation in the Indian Ocean is the only choice for the powers. Over the past years, China has put forward the Belt and Road Initiative, the Silk Road Economic Belt and the 21st Century Maritime Silk Road, and China has promoted international cooperation under the framework of the Belt and Road Initiative. For the initiative, the Indian Ocean is an important region where the 21st Century Maritime Silk Road goes through. The Belt and Road Initiative is aimed at connecting countries along its route to promote economic prosperity, [inaudible] trade and understanding between peoples. To promote peace and security and to ensure freedom of navigation in the Indian Ocean, the great powers can cooperate to provide public goods in counter-piracy, counter-terrorism at sea, joint search and rescue, humanitarian assistance, combatting drug smuggling and international [inaudible]. Their militaries can increase cooperation and enhance military trust by joint efforts in training and exercises. To conclude, it is quite normal for great powers to have differences and compete with each other. However, it is critical to ensure that the competition is benign. Powers cannot focus on their differences and neglect their cooperation. Whether the Indian Ocean becomes an ocean of stability and harmony or an ocean of conflict and trouble depends on the strategic choice of every country. Ladies and gentlemen, thank you for your attention. Thank you very much. We have now about 40 minutes for a discussion session. I am taking an extra five minutes because we started five minutes late. I think this has been a fascinating set of introductory remarks, very rich in content, substance and policy relevance. What I am very keen to do is that if anyone wants to ask a question or make a comment, I want to ensure that they are able to do

so. So, even if you are thinking of raising your hand or making a point, please do so early, so I will have your name on a list because I do not want to disappoint anyone in that respect. So while you think of the questions you want to ask or the comments you want to make, let me start by asking a question of my own to all members of the panel, and I look forward to brief responses. The question is this. Two things have struck me from the presentations. The first is the presence of regional, sub-regional organisations, but still the inability to cooperate effectively. One of our speakers talked about strengthening the regional mechanisms. Another talked about the importance of values and principles to be brought to the table on these aspects for a shared perspective. The second point, I think, for me that came out was a clear sense of a requirement within the region of more effective maritime domain awareness, for maritime security. Now, I want to put these two together, and the question I want to ask is that we have seen in the past year or two that issues of maritime domain awareness are important and understood, but they are also controversial in two areas. One is in terms of capacity. There are countries that are not able to do this themselves, but countries that sometimes get into controversy individually in the bilateral relationship over maritime domain awareness. And the second is, there is still, I think, a confusion over which countries should lead on this. The question, therefore, is can any of the regional organisations effectively work together for cooperative maritime domain awareness in the Indian Ocean region? Let me start by going in the order that we started. So if I can ask the Minister to quickly respond in a minute or two or less to this question and I will take names from all of the other participants. The question is, essentially, can regional organisations provide cooperative maritime domain awareness, so maritime domain awareness does not become simply a bilateral issue, but there is more of a buy-in by a larger number of states? Is that feasible and is it practical? Macsuzy Mondon, Designated Minister, Minister for Local Government and Home Affairs, Seychelles I think there is effective cooperation within the region itself and there has been a lot of support provided, and this has been as a result of all the different countries getting together and supporting each other. Like I gave the examples of piracy at the beginning. And I think that regional organisations can provide maritime awareness. I think what we are looking for is to strengthen what we already have in the region and make it work better so that we can deal with emerging challenges. I think we agree that maritime security is very challenging and we have new emergent issues every now and then coming up. So it is more and more important for us to be able to find new ways of working together for us to be able to deal with the challenges. Thank you. Kapila Waidyaratne, Secretary of Defence, Sri Lanka Chairman, I too concur with or agree with the Honourable Minister because at the moment there are several regional organisations. Say, for instance, the Regional Cooperation Agreement on Combating

Piracy and Armed Robbery against Ships in Asia is one there; the Working Group on Open Operations at Sea and Contact Group on Piracy off the Coast of Somalia. There have been several and say, for instance, the IORA and then also Australian Maritime Safety Authority. There are various regional organisations. I think they have been working together and their results I am sure the organisations can work out. Vice Admiral (Retd) Shekhar Sinha, Director, India Foundation Not for a practical solution. You are quite right in saying that the bilateral relations can actually derail this entire [inaudible]. The majority of countries, at least in the Indian Ocean region, right now in our immediate seaward side or neighbourhood, we already have an agreement of sharing data. What we can do or what can be done is to improve the transparency and sharing of data so that where you have the data centre, then you can have the representatives of these countries actually being there. For example, the Fifth Fleet headquartered in Bahrain, you know, you have liaison officers from various countries. So I think that is one way to look at it. And I think it should be feasible because, after all, data exchange is a bilateral agreement which already exists and that is why you have this, getting the [inaudible]. And now to improve the transparency, you have them posted, have them located there, you make it a permanent feature. You have already, for search and rescue, you have the MRCC and CRCC and all countries are there. How do you actually spot the ship? It s based on this MDA. It is just that you take it from the nearest country or the nearest ship. So this is one area where the data bank is very large, people are connected all the time and you have them located inside the same area. Philip Barton, Director-General, Consular and Security, Foreign and Commonwealth Office, UK Thanks very much, Rahul. I think we have seen off Somalia our ability in crisis situations to come together very effectively, but I think there is a gap in less critical times in this area. I like the Admiral s suggestion. I think there is something around just putting in place a really practical arrangement so that we can all have the same data and act on it for collective security. Senior Colonel Zhao Xiaozhuo, Director, Centre on China American Defense Relations, Academy of Military Science, People s Liberation Army, China The people in this region have shown a strong desire for development. I think China can help this region to develop. We know this year marks the 40th anniversary of China s opening-up policy. Forty years ago China was a backward and poor country, and over the past 40 years development it has become a modern country. So I think it is a successful story. And just recently China put forward the Belt and the Road Initiative. I think that is an opportunity for countries in the Indian Ocean to join the initiative, and China and countries in this region can work together for their development. Thank you very much. Very useful for me. Let s open the floor for discussions. I have three or four names already. Let me start first with Salma.

Salma Malik, Assistant Professor, Defence and Strategic Studies, Quaid-i-Azam University Thank you very much, Rahul. It was really heartening to listen to such a wonderful panel all talking about cooperation. I could not help recall India Pakistan bilateral tiffs, especially over an anti-piracy operation which had gone pretty successfully and both the countries could not figure out who takes the credit. Keeping such things in mind, when we are looking at concrete measures for cooperation, what can the panel kindly suggest as to what disaster-management strategies or confidence-building measures (CBMs) can there be, especially when it comes to environmental, man-made or climatic situations. Thank you. Ali Sarwar Naqvi, Executive Director, Centre for International Strategic Studies; Former Ambassador of Pakistan to Austria This is not that much of a question, but I just want to recall for the panellists and the audience here, in response to your point about organisational framework, that there was an initiative in the 1980s which was when the UN established the Ad Hoc Committee on the Indian Ocean, and I happened to be with the UN at that time and I was a member of that committee. It was chaired by a very venerable Sri Lankan diplomat, Ambassador Fonseka, and he was the Permanent Representative of Sri Lanka in New York. And this continued for about 15 years or so. But the Ad Hoc Committee of the Indian Ocean, which grouped together 32 littoral states, just could not work out an organisational framework, and this is very important. I think Pakistan has again revived the idea at the UN, and if countries which are in the region would work towards achieving that kind of an agreement for setting it up, that would be extremely useful. Thank you. Thank you, Ambassador Naqvi. Let me turn to the panel in response to Salma s question. But particularly, let me start with Philip and then Admiral Sinha and then if others would like to come in please do. Philip Barton, Director-General, Consular and Security, Foreign and Commonwealth Office, UK Thank you very much, Rahul. Salma, I wanted to answer your question with reference to the hurricanes that swept through the Caribbean last year, because I was heavily involved in the UK response because it affected a number of our territories. It also affected French, Dutch and US territories as well as independent Caribbean countries, and we were close to overwhelmed, if we are honest, despite all of the resources at our disposal. So, when we reflected afterwards on the lessons, the things that we wished we had done in advance and that we are trying to do before this year s hurricane season, are around understanding where the biggest risks are and then putting in place in advance liaison arrangements, working out how we will do multinational command and control, so that as different countries bring military and civilian assets in disaster relief, how you are going to make sure the right things end up in the right places and you are prioritising according to acute need.