The partnership between Russia and China may prove to be a fickle one.

Under former Russian president Vladimir Putin, the Russia-China relationship had considerably improved. For instance, the long-standing border disputes between both states were settled in 2005. Furthermore, the nations signed cooperation agreements, which enabled them to reach a ‘strategic partnership’. To demonstrate their partnership and dominance over the Asian region, China and Russia repeatedly conducted large military exercises. Aside from the political realm, economic cooperation was also fostered, especially through Russian exports of energy resources and weapons. However, there is also another side of this shining Russo-Chinese coin: Russia’s Far East region is flooded with Chinese migrants. Moreover, Beijing is driving Russia out of its traditional backyard of Central Asia, and in Moscow it is a taboo to speak of a Chinese threat. This raises doubts whether this assumed and formally laid-down partnership in in fact friendly. Is it more realistic to describe the relationship between China and Russia as antagonistic?

Politics: Harmony and Dispute

The Russo-Chinese strategic partnership was aimed at countering the Western and US-driven ‘monopoly in world affairs’, as was made clear in a joint statement by the Chinese and Russian Presidents in July 2005. Subsequently, in other joint communiqués, Beijing and Moscow condemned Western military action in Iraq, Afghanistan and elsewhere. Current Russian President Dmitry Medvedev has also given a high priority to maintaining close ties with China, as established by President Putin beforehand. At the end of May 2008, soon after his presidential inauguration, Mr. Medvedev made his first visit to Beijing. A joint statement by the Russian President and his Chinese counterpart Hu Jintao revealed a number of like-minded views on international politics, which included a rejection of the US missile defence system.

In addition to this, the two parties signed deals on nuclear energy, aerospace, and nanotechnology. In July, the Russian and Chinese foreign ministers signed a border agreement, which settled the demarcation of the 4,300-kilometer border. However, the Chinese media made clear that the agreement was seen as a territorial hand-over by Moscow.

Conversely, in August 2008 the previously friendly Sino-Russian relationship and accord on international security became fractured, as China did not approve of Russia’s recognition of the independence of Abkhazia and South Ossetia after Russia’s conflict with Georgia due to its own separatist problems in Tibet and Xinjiang.

In addition, tension has arisen in the international realm of bilateral cooperation between Moscow and Beijing due to different perspectives regarding the role of the Shanghai Cooperation Organisation (SCO). The SCO is a regional international grouping on political, economic and military cooperation, with China and Russia in a leading role and Kazakhstan, Uzbekistan, Tajikistan and Kirgizstan as the other Member States. Although Russia and China initially used the SCO to make a joint stance against the West, Russia considers the SCO an instrument of its foreign and security policy, in order to reinforce its position in the international arena.

On the other hand, China regards the SCO as a useful economic platform in order to acquire energy resources and to sell its own products. Emphasizing military power through the SCO, as done by the Kremlin, could well be detrimental for the economic objectives of Beijing. Taking into account that Russia has resisted Western military presence in its ‘backyard’ – the former Soviet Central Asian republics – Moscow has to increasingly face the fact that not the West but China is taking over this region.  China has managed to do so by investing in energy plants and in road and railway networks, thus making itself an attractive partner for the Central Asian states. Hence, it is clear that international cooperation is also eroding between China and Russia as a result of contradictory interests.

Demographic Threat

In itsFar East, Russia is facing a significant illegal immigration from China. In December 2005, Rashid Nurgaliev, Russia’s Interior Minister, stated that illegal migration – among other aspects – was creating a threat to national security in Russia’s Far East. Although Mr. Nurgaliev did not mention the word ‘Chinese’, and in spite of frequent formal statements contradicting such a development, there has been a continuous influx of illegal Chinese immigrants in this region. Russia has a long border with China and is sparsely populated in its Far East. The numbers of Chinese immigrants may vary but several sources mention a flood of Chinese entering Russia, although this has been continuously officially denied. One source claimed that in 2004 there were already four million Chinese residing in Russia, with an annual inflow of 600,000, which would suggest approximately 10-20 million Chinese living in Russia by 2015. However, according to another source, in 2005 there were no more than 100,000 Chinese living in Russia’s Far East.

Another possible indication that Moscow feared a Chinese takeover of its Far East appeared in December 2006, when Mr. Putin warned of the social and economic isolation of the Far East from the rest of Russia, which would pose a serious threat to Russia’s position in the Asia-Pacific region and to its national security. It was not inconceivable that the overflow of Chinese immigrants was more than a coincidence, but possibly a planned policy directed from Beijing in order to gradually increase its influence over this Russian region. The reasons for such a population policy were perhaps to create an overflow area for Chinese citizens from overly populated regions in China, but also to gain a political and/or economic foothold in Russia’s Far East, which is rich in energy sources.

In addition to an alleged ‘demographic’ policy from Beijing, Russia’s own regional and local authorities in the Far East are also following a separatist course divergent from the one taken by Moscow. For example, in the Birobidzhan district, bordering China, regional Russian authorities were allegedly using federal budget transfers to finance Chinese businesses. Furthermore, Chinese farmers in Birobidzhan, subsidized by the regional authorities, were selling their produce to China. In fact, Birobidzhan represented a region in which 80% of the foreign trade of the Far East region was oriented to China, Japan and South Korea, not Russia. Hence, because of continued demographic (influx of Chinese immigrants) and economic developments (the region’s outlook to the East), Russia’s leaders felt that Moscow was gradually losing its grip on its Far East.

War Games

In August 2005, for the first time in 40 years, Russian and Chinese armed forces, formally under SCO aegis, carried out joint ‘Peace Mission 2005’ exercises, comprising 10,000 military personnel, navy vessels, and aircraft. According to Russia’s Minister of Defence, Sergei Ivanov, the decision to conduct bilateral exercises was made in Beijing, in December 2004. China took the lead in proposing the size, the participating type of forces, and the content of the manoeuvres. The Chinese Chief of the General Staff and his Russian counterpart stated multiple times that the manoeuvres were in line with UN principles and were not aimed against other countries. The formal objectives of the exercises were to fight against international terrorism, separatism, and extremism, and to enhance mutual combat readiness against novel developing threats.

Another aim of these exercises seemed to be to promote arms export from Russia to China. The Chinese armed forces were – as a consequence of China’s increasing political and economic power – in a stage of growth, in size as well as in ambition. Therefore, practising command and control procedures, but also purely operational aspects, such as carrying out an airborne assault, strengthened the capabilities of the Chinese forces. It is also important to consider that if Russia considered that China could turn into a threat in the long run, then these exercises were worthwhile for the Russian General Staff as well, since they provided insight into the mechanism of Chinese armed forces operations as well as their current capabilities. The formal exercise objectives had little to do with warfare against terrorism, as declared, but were actually nothing other than practise of conventional warfare, employing all services with the exception of nuclear forces. Therefore, the most likely real main objective of the manoeuvres was for China and Russia to show to the (Western) world that both nations considered themselves to be in control of the Asian-Pacific region and that others were not to interfere in their sphere of influence.

In August 2007 the SCO, but predominantly Russian and Chinese troops, once more conducted large military exercises in China and Russia, under the title ‘Peace Mission 2007’. Now, the war games were to be conducted mainly in Russia – in the vicinity of the town of Chebarkul, in the Chelyabinsk region of the Ural Mountains – after starting in China, in the northwest city of Urumqi. Russia and China had different opinions on some aspects of the 2007 exercises. Regarding the size of the force contributions, China more than once pressured Russia during the consultation rounds to accept a bigger Chinese contingent. Although Russia agreed with this, they did not agree with the Chinese request to participate with tanks and other heavy equipment, in order to keep the operation along the lines of the intended anti-terrorist scenario. The SCO ‘Peace Mission’ 2005 and 2007 drills proved that the organization had two lead nations, which publicly cooperated intensively, but which were often involved in a struggle for power behind the curtains.

Arms

One of the Russia’s aims for the Sino-Russian SCO ‘Peace Mission 2005’ exercises was arms export, as the demonstration of the capabilities of Russian military equipment was expected to encourage China to buy them. This assumption was strengthened by the fact that right after the closure of the exercises, China announced that it was interested in acquiring 30 Il-76 transport aircraft. In 2006, some 45% of Russia’s arms export belonged to China. Since 2000, Russia has delivered weapon systems to China – including fighter aircraft, submarines and destroyers – amounting to an average of $ 2 billion annually. Hence, China was the biggest buyer of Russian military equipment. Russia’s arms export to China was an important factor in the cooperation between the two countries. However, Russia seemed to be well aware that China would like to obtain its most sophisticated military technology, which, in case of deteriorating relations, might be turned against Russia. For that reason Russia was reluctant to provide China with its state-of-the-art products.

Moreover, there were indications that China was steadily acquiring enough knowledge to have a solid military industry of its own. In spring 2008, information was released that in 2007, Russian arms export to China had dropped by two-thirds because the size of Beijing’s military industry was approaching that of Moscow’s. Subsequently, in the coming years China would buy less and less arms from Russia, thus diminishing the value of this cornerstone of bilateral relations. Furthermore, as of 2007, reports circulated that China was copying Russian arms technology for its own exports. Hence, another reason for the reduction in arms’ sales was that China sought more sophisticated technology than Russia was willing to offer. With  regard to copying, once China had mastered the technology of Russia’s Su-27SK Flanker fighter, it produced its own version, the J-11B, to sell to other countries, and subsequently ended the license-contract with Moscow. Beijing even exported the J-11B to Pakistan without a permit from the Russian aircraft manufacturer Sukhoi. China was eager to do the same with the Su-33 Flanker-D carrier-based fighter, but the Russians were now aware of this attempt.

Energy

China has recently become the world’s largest oil importer. Hence, a consistent element of Chinese policy is searching for energy resources. In August 2005 during a visit to Bejing, Mr. Putin stressed bilateral economic ties. He emphasized especially the work of Russian energy companies in China, and resulting bilateral projects that would distribute those supplies to other countries, as well as the delivery of Russian oil and gas to China. Furthermore, in November 2005, Russia and China agreed to double Russian oil exports to the latter and to consider constructing an oil pipeline from Russia to China and a gas-transmission project from eastern Siberia to China’s Far East. However, China also focused on Iran and Kazakhstan in its need for energy. It received 13% of its oil imports from SCO-observer Iran, whose share it intended to increase. Additionally, in due course a Sino-Kazakh pipeline was to be expanded and would eventually provide China with some 15% of its crude oil needs. In this way China wanted to diminish its energy dependency on Russia.

Another argument was that by redirecting Kazakh oil pipelines through China instead of through Russia, China’s influence over Kazakhstan and Central Asia would increase at the expense of Russia’s influence over the region. However, although cooperative with China in energy, Kazakhstan had a considerable Russian minority and therefore would be hesitant to follow an anti-Russian political course. In addition to decreasing energy dependency on Russia, China’s alignment with Kazakhstan was allegedly also caused by its disillusionment with Russian policy. Beijing had failed to achieve a position on Russia’s energy market after trying to build an oil pipeline from Angarsk to Daging with Yukos. After Yukos’ director Mikhail Khodorkosky was arrested, this project was stopped, much to the annoyance of China. In 2008 Russian oil exports to China were decreasing because China was reluctant to accept Russia’s prices. The differences on export volumes and prices of oil also prevented the intended construction of an oil pipeline from Eastern Siberia to China, and also that of the Altai gas pipeline. In October 2008, after long negotiations, Russia and China finally agreed upon the oil pipeline to China, (to be operational in 2011), whereas the gas pipeline project was still suspended due to disagreements over gas prices. In April 2009, both parties finalized a deal under which Russia would supply China with oil for 20 years. Clearly, both parties were tough negotiators when it came to energy deals.

Future

Although under Mr. Putin the Russian-Chinese cooperation initially seemed quite promising, in due course this relationship showed some cracks. Nevertheless, under Mr. Medvedev, the cooperation between the two states was further reinforced, as long as it served mutual interests. China and Russia remained focused on maintaining closer cooperation not only in the field of security policy, but also in areas such as energy, (arms) trade, and foreign policy. Russia has stated more than once that intensification of the relations with China is a geopolitical objective to reinforce Russia’s global position.

Yet this strategic cooperation with China might only last for a specific period of time, before contradictory interests become too important to ignore. For instance, this may occur in regard to China’s use of Moscow’s military technology and energy sources. Once China is independent of Russia’s arms industry and receives sufficient supplies from other energy producers in the region – such as Iran, Kazakhstan, Turkmenistan and Uzbekistan – Beijing might well ‘dump’ Moscow as its strategic partner. Although taboo prevents one from stating this publicly, the Kremlin is well aware of the fact that the growing political, economic, and military stature of China could develop into a threat to Russia. However, Moscow can do little more than to seek alliances with China’s other ‘competitors – in effect with the descending power of the United States as well as rising India. In that situation it is not unthinkable that the Chinese threat will ultimately force the Kremlin to a genuine ‘reset’ of its relations with the West.