Prof. (Dr.) Hebatallah Adam
Professor of Economics
Horizon University College, UAE
Founder and President of Global South Research Foundation
Email: adamhebatallah@gmail.com
Abstract: Central Asia is emerging as a key economic region. It is a significant energy center and a main transit corridor, being at the intersection of Europe, Asia and Middle East, connecting global markets through an expanding network of infrastructural building structures. Hydrocarbon endowment coupled with its positioning in the emerging connectivity schemes has made it the focal point of coming energy and trading relations.
This transformed importance is incited by three interconnected factors. First, the transformation of energy markets throughout the world has enhanced the need to find diversified suppliers and routes of transportation. Second, the growth of the geography of corridor-based connectivity projects, such as the Belt and Road Initiative of China or the Trans-Caspian (Middle Corridor), has transformed the geography of Eurasian trade. Third, the structural vulnerabilities of the Central Asian economies are still revealed due to the constant dependence on migration and remittances.
Collectively, these dynamics have generated a structure of competitive interdependence in which economic cooperation is coupled with geopolitical rivalry between the major powers: Russia, China, the European Union and the United States. As a reaction, the Central Asian nations have chosen approaches of multi-vectors in maintaining equilibrium of their international relations without sacrificing independence. In this respect, the re-entering of India into Central Asia is a sign of a recalibration, though gradual and strategic.
To this end, this article analyzes the role of India in this regard on three interconnected levels: energy, connectivity and strategic balancing as part of the overall political economy of Central Asia.
1. Energy Security and the Political Economy of Diversification
Energy is the most dominant axis of the Indian interaction with Central Asia. India being a fast-growing economy with surge in the energy demand has tried to diversify its suppliers other than the traditional ones. Central Asia’s oil and gas reserves play a key role in this. However, in the modern geopolitics of energy, resource endowments are not sufficient. The governance of infrastructure, price and supply chains is also essential. The presence of reliable infrastructure, such as a pipeline, is both a resource and a geopolitical advantage.
A case in point is the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline. Ideally, TAPI is a model of regional interdependence that connects producers, transit states, and consumers in the context of a geoeconomic integration. However, it has been limited by security threats, governance and funding uncertainties.
Politically, this highlights the need to have a risk-adjusted strategy on energy diplomacy. The policy of India must reconcile long-term aspirations with structural instability of transiting areas by focusing on the diversification of several projects and partners and focusing less on individual projects.
2. Connectivity and Corridor-Based Development
The second pillar of the Indian activity in Central Asia is connectivity. The geographical isolationism in the region requires the creation of effective transport corridors to provide trade integration and economic diversification.
The Belt and Road Initiative (BRI) launched by China has already greatly changed the landscape in the contexts of connectivity of the region which has developed large-scale networks of infrastructure connecting Central Asia to the rest of the world. This initiative has raised dependency concerns, sustainability of debt and asymmetrical interdependence.
Therefore, India has attempted to establish complementary connectivity networks with Central Asian countries. Two initiatives were remarkable the International North-South Transport Corridor (INSTC) and Chabahar Port development in Iran. They aim to:
- Give alternative routes that do not go past geopolitical bottlenecks,
- Intensify exchange connectivity among south Asia, central Asia and Europe,
- Enhance a more diverse and stronger corridor ecosystem.
India’s projects and initiatives have been gradual and dependent on larger dynamics in the region, especially in security conditions in Afghanistan and stability of transit alliances. As a result, the connectivity aspirations of India with Central Asia are considered as a process of a long-term involvement and not one of instant change.
3. Strategic Balancing in a Multipolar Regional Order
The political environment in Central Asia is complicated due to the relationships between global powers like Russia, China, the United States, and regional powers like Iran and Turkey. This has led to the development of a multi-dimensional diplomacy system, in which the countries of Central Asia are trying to find a way to deal with rival powers to keep their independence.
India’s involvement aligns well with this approach. It is a balancing state that is trying to manage its relations and increase its choices.
This is significant for transnational organisations such as the Shanghai Cooperation Organisation (SCO) where there is a power imbalance, despite the opportunities for economic co-operation.
India’s engagement with Central Asia is viewed as non-hegemonic integration that could be making the region more diverse.
4. Development Diplomacy and Human Capital Engagement
India’s engagement with Central Asia is distinct in that it is more focused on development diplomacy, particularly in education, technology transfer and capacity-building.
The key development issue for Central Asia in the long term is its over-reliance on the hydrocarbon sector and remittances. To diversify, it should adopt a range of development policies, including human and institutional capacity building and innovation ecosystems.
India has a comparative advantage in the digital and public infrastructure of public education, higher education and health, making it an ideal development partner for the region. In fact, India has been assisting by providing technical and knowledge support through initiatives such as:
- Development of skills and improvement of the workforce,
- Digital transformation and adoption of technology,
- Capacity to strengthen the institution and governance.
Although these investments are not as noticeable as large-scale infrastructure projects, they are essential in the achievement of inclusive and sustainable development goals.
5. Constraints and Structural Limitations
India’s engagement with Central Asia remains limited, despite growing interest, for a number of reasons:
- The lack of the physical geographic connectivity,
- Limited financial ability compared with leading powers,
- Delayed infrastructure project implementation.
Further, the regional landscape remains uncertain in terms of security, political and economic challenges. This requires a pragmatic approach.
There is a level of skepticism about the potential for India to rise as a regional hegemon. Rather, it is likely to be gradual and situational, determined by its capacity to engage in the region.
6. Conclusion and Implications for Regional Development
India’s approach to Central Asia demonstrates that it is a sophisticated player in a region of growing economic significance. India can be a regional force for stability in the geopolitically challenging region through its energy, connectivity and development initiatives.
India-Central Asia relations have the potential to transform the region. India can help turn the existing regional imbalances into a win-win scenario. This has policy implications, including:
- Making the energy security more diverse by sourcing or transit pathways,
- Facilitating transparent and sustainable development of infrastructure,
- Enhancement of human capital by means of education as well as transfer of technology,
- Promoting regional integration via multilateralism.
As highlighted in the broader analysis, the development path of Central Asia would become sustainable only once the interdependence is converted into collective resilience. India’s approach, while still emerging, is well aligned with this goal, encouraging diversity, inclusion and balance.
References
Dave, B., & Kobayashi, Y. (2018). China’s silk road economic belt initiative in Central Asia: economic and security implications. Asia Europe Journal, 16(3), 267-281.
Kavalski, E. (2019). The puzzle of India’s relations with “Central Eurasia”. Asian Security, 15(3), 304-322.
Naazer, M. (2022). Great Powers, Core Members, and the Fate of Regional Cooperation: A Study of Indian and the US Behavior towards India-Pakistan-Iran Gas Pipeline Project. Journal of South Asian Studies.
Palu, R., & Hilmola, O. P. (2023). Future potential of trans-caspian corridor. Logistics, 7(3), 39.
Pradhan, R. (2020). Energy geopolitics and pipeline diplomacy in Central Asia: India’s interests and policy options. Jadavpur Journal of International Relations, 24(2), 216-246.
Pradhan, R. (2022). Energy geopolitics and the new great game in Central Asia. Millennial Asia, 13(2), 265-288.
Sanaei, M., & Sangari, F. A. (2023). Iran and Regional Convergence in Eurasia. Middle East Policy, 30(1), 48-61.
Warikoo, K. (2016). Central Asia and South Asia: Opportunities and Challenges. India Quarterly, 72(1), 1-15.
Zhou, Q., He, Z., & Yang, Y. (2020). Energy geopolitics in Central Asia: China’s involvement and responses. Journal of Geographical Sciences, 30(11), 1871-1895.