Russia’s Asian reorientation – Observer

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The aggression against Ukraine and the resulting boycotts and sanctions are already isolating the Russian economy from the West and forcing Russia to seek new horizons. This was clarified by the Putin’s call for redirect Russian energy exports to emerging markets in the south and east. Here, the main focus of Moscow’s attention is inevitably the Asian system, of which Russia is a part and in which it has become heavily involved over the past decade, through expanding ties with China, India, South East Asia, Middle East and Gulf. In particular, Moscow came to develop a close partnership with Beijingeconomically, politically and militarily, this partnership being strengthened on 4 February, the date on which Xi and Putin said that the two states will expand their cooperation and act together in the Asian system.

Since the start of the invasion, Russia-China trade grew upChina has increased its gas imports, coal and Oil Russians and the infrastructural links between both countries are expanding. China already come to say that will strengthen ties with Russia in the fields of energy, finance, S&T and the military-technical sector and, also in March, shortly after the invasion, Wang Yi, Chinese Minister of Foreign Affairs (MNE) , said that the two countries will maintainstrategic direction“and cultivate”a complete partnership”. for the rest, the recent joint military exercise during Biden’s visit to Japan was a clear affirmation of Sino-Russian cohesion.

It is quite possible that today we are already faced with the birth of a China-Russia geopolitical axis. Such an axis would tend to bring together a whole series of aligned states and would aim at the autocratic transformation of the international order. It would also seek to harmonize interests across Asia, under the Sino-Russian umbrella, a scenario that would lead to a drastic reduction in Western influence in the region.

Indeed, Russia and China are actively interested in embarrassing the West. One line they will tend to follow is to challenge the dominance of the dollar and other Western currencies, and any significant reduction in that dominance would have serious consequences for the West itself. China and Russia passed in recent years ‘de-dollarize’ trade between the two and China appears to be negotiating crude purchases to Saudi Arabia in yuanwhich, if it were to happen, could create a domino effect for the petrodollar and, therefore, for the dollar itself as the world’s reserve currency.

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Moscow, in turn, would like to co-opt the BRICS (the five largest emerging economies) to extend the use of their national currencies in international trade, to the detriment of the dollar. This is how Kremlin-aligned Valdai club Lissovolik recently emerged promote a program even Valdai for this specific purpose. The Kremlin also speaks through Sergey Glaziev, who advocates isolate the West by creating a new international financial architecture for countries aligned with Russia and China: these countries would stop using the dollar in favor of national currencies and physical gold, which, Glaziev notes, “is produced in abundance in Russia”.

Moscow already seems to be raise the ruble to the gold standard, which would force external players to pay rubles with gold to buy Russian resources. This, if imitated by China, which has been accumulate goldcould impose drastic discontinuities on the global monetary structure.

China and Russia are part of the Shanghai Cooperation Organization (SCO) which, along with India, Pakistan and four Central Asian states, encompasses nearly half of the world’s population. On March 22, Zhang Ming, general secretary of the SCO, met the Russian state VEB.RF to criticize the “illegal unilateral sanctions” and express the availability of the OCS to provide “all kinds of support for VEB.RFin the OCS space. OCS has worked to increase the use of national currencies of foreign trade and, from March, the implementation of a treaty for the consolidation of regional relationships.

May 26, Putin just put forward the idea of a pan-Asian partnership bringing together the SCO, ASEAN and other regional agglomerations. This offer was put into perspective by Kosachevof the Russian MNE, who, speaking of such a partnership, said that it could be used to isolate the West.

It is not certain that Asia as a whole will support Russia in its reorientation towards the East. The vast majority of Asian countries have complied with the sanctions, while avoiding damn with insurance Moscow: seen on April 7 at the UNwhile almost all of Asia avoided voting against Russia.

The essential factor of unpredictability in Asia is India, a nuclear power which is, today, one of the largest economies in the world. India has close ties with Russia which, since the Soviet era, was its strategic partner vis-à-vis China. However, this will tend to cease to be true with the current Sino-Russian alignment. This is something that could push India further west or, on the contrary, lead it to harmonize its relations with China.

So far, and since the invasion of Ukraine, India has extended its gas imports, oil, coal and fertilizer Russians, with Delhi to encourage Indian state-owned enterprises invest in the Russian oil sector and discuss rupee-ruble transactions with Moscow. However, at the same time, India has also strengthened its relations with EH, UK and squarebecause he joined the Indo-Pacific economic framework. It is therefore possible that the Indians are trying to maintain their traditional status as a self-governing, non-aligned power.

Russia’s Asian reorientation also involves the consolidation of the Eurasian Economic Union (EAEU), the economic bloc which, from 2015, came to be created in a post-Soviet space. The UEE includes Russia, Belarus, Armenia, Kazakhstan and Kyrgyzstan and since the invasion has develop links with the SCO and with the CICA, the Asian forum covering 27 countries. also adopted resilience measures to address the regional impacts of sanctions and is working on increased integration, import substitution, industrial cooperation and foreign trade through the use of national currencies. The UEE is further developing the regional transport infrastructurewhich includes the agroexpresswhich will transport agri-food products to China.

The EAEU is complemented by the Collective Security Treaty Organization (CTO), the regional military bloc created in 2002. The CTO is deepen ties with the Shanghai Cooperation Organization and the China has already expressed interest in cooperate with the CTO. Also on the occasion of the recent CTO summit, on May 16, it was said that it will be expanded with new members, partners and observers and, a few weeks before the war, Pankin from the Russian MNE, says the CTOshould be present on the world stage“is it”our many partners“, give signals”be ready to cooperate”.

It seems clear that the West needs to make persuasive appeals to countries that tend to align themselves with Russia and China. This largely involves the provision of joint trade and development programs. The Indo-Pacific economic framework is already a first step in this direction.

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