In three “strikes” during the third quarter, Moscow and Beijing pushed their bilateral relations, qualitatively and quantitatively, toward a more proactive and outward-looking posture. It began with the signing of the Sino-Russian Joint Declaration on the International Order in the 21st Century at the Moscow summit July 1. A few days later at the annual Shanghai Cooperative Organization (SCO) summit July 5, a significantly enlarged regional security forum – adding India, Iran, and Pakistan as “observers” – called on the U.S. and its coalition members in Afghanistan to set a deadline for U.S. withdrawal from military bases in the territories of the SCO member states (Kyrgyzstan and Uzbekistan).  In late August, the first-ever Sino-Russian joint exercise, code-named Peace Mission 2005, further elevated the strategic partnership between the two continental powers. In the wake of the exercise, Russian military sales to China, too, apparently entered a new phase with new categories of weaponry being offered as well as technological transfers.

Behind and beyond summits

Four times during the quarter, Russian and Chinese presidents found themselves together, either in bilateral or multilateral occasions: the Moscow summit (June 30-July 3), the SCO summit (July 5), the G-8 summit (July 6-8), and the UN 60^th anniversary summit (Sept. 14). At the Moscow summit, the first state visit by President Hu Jintao to Russia after President Vladimir Putin was inaugurated for a second term, Chinese and Russian leaders laid the ground work for a “new and fair” international order. In the 12-article joint declaration, there are phrases such as sovereignty, international law, multilateral approaches, equality, mutual respect, peaceful coexistance, diversity, dialogue, the UN, etc., many of which appeared in other documents previously signed by Russian and Chinese leaders. The totality of the declaration, however, gives the impression of a more consistent and coherent vision by Moscow and Beijing of a desirable international order, one that is different from the one of unipolarity and unilateralism projected by the U.S. (for an initial assessment of the declaration, see the second quarter analysis, “Politics of Anniversaries and Beyond,” www.csis.org/pacfor/cc/0502Qchina-rus.html).

Two additional features of the document stand out. One is the recognition by the drafters of the protracted process for constructing a new and fair world order (Article 1), and that such a process is a continuous search for policies and resolutions acceptable by all sides (Article 12). In sum, both the beginning and ending of the Moscow declaration indicate that the two major powers will work with and “improve,” rather than outright reject, the existing world order.

The second feature of the document is its clear articulation of what Moscow and Beijing desire for the 21^st century world order. The main body of the document specifies several areas for improvement: adhering to international law and multilateral institutions (Articles 2 & 3); promoting globalization and development at both global and regional levels (Articles 4, 5 & 10); respecting different cultures and diversity of civilizations (Articles 6, 7 & 8); working toward a new international security mechanism based on strategic stability, arms control, and nonproliferation through multilateralism and dialogue (Article 9). All these desirable features of a new international, or interstate, system are, according to the document, operating principles between Russia and China (Article 11). All this is done without finger pointing and the U.S. is never named in the document. And yet it is obvious that both Moscow and Beijing are distancing themselves from the policies of the Bush administration in the areas of antiterrorism, democratization, and nonproliferation. Their post-9/11 “honeymoon” with the world’s sole superpower has, therefore, come to an end.

At least two factors are behind these outward-oriented policies in Sino-Russian relations. The first is a procedural one. After years of adjusting to each other’s domestic development and of harmonizing their not-so-intimate bilateral relations, Moscow and Beijing have essentially worked out major huddles in their bilateral relations with a growing sense of shared purpose. It is time to look beyond the horizon. The border issue, the single most important factor, or irritant, in Sino-Russian bilateral relations for 300 years, was finally resolved in October 2004 when President Putin and his Chinese hosts signed the border agreement in Beijing (See “End of History? What’s Next?” www.csis.org/pacfor/cc/0404Qchina-rus.html). This was followed by the initiation of regular Russian-China intergovernmental “security talks” in Moscow in February 2005 between Chinese State Councilor and former Foreign Minister Tang Jaixuan and Russian Secretary of the Russian Security Council Igor Sergeyevich, (see “Back to Geostrategics,” www.csis.org/pacfor/cc/0501Qchina-rus.html).

“All big political problems in bilateral relations have been settled in essence, which created a reliable foundation for friendship and cooperation between China and Russia for a long period,” stressed Putin when he hosted his Chinese counterpart with a private dinner at his dacha outside Moscow June 30. President Hu echoed that “we have settled border issues inherited from the past, are supporting each other on the most important issues concerning state sovereignty and territorial integrity, are maintaining close contact on international and regional affairs, thus effectively ensuring the two countries’ common interests, and have made a contribution to the noble cause of strengthening peace and stability in the whole world.”

There is, however, a second or short-term explanation for the Moscow declaration of a new world order: the concerns of a steady and persistent encroachment of their vital national interests by the U.S.  Exactly what was discussed in the late-night talks between Putin and Hu remains undisclosed. (The two had so much to talk during and after dinner that the party was not over until 11:00 pm.) The late-night talks, however, were said to be “of a strategic nature” covering “international problems of mutual interest.” Indeed, they did not have to look very far beyond their horizon to notice recent and ongoing alarming signs: the ever assertive foreign/defense policies of the Bush administration despite the bloodiest “peace” in Iraq; steadily growing Japanese military power; the precarious Korean nuclear standoff; an almost unstoppable arms race across the Taiwan Strait; and a deluge of “color” revolutions across the former Soviet states (Georgia, 2003; Ukraine, late 2004; Kyrgyzstan, March 2005; and then Uzbekistan). The U.S.-Japan “2+2” meeting held Feb. 19, 2005 was seen as a major elevation of the military alliance between the two largest economies. For the first time, the U.S.-Japan alliance has clearly moved beyond its original goal of defending Japan to cover situations involving the Taiwan Strait and the Korean Peninsula.

In this regard, the “global reach” feature of the Sino-Russian joint declaration can also be considered as a means to defend the bottom-line of their core national interests – outside powers should not interfere in their internal affairs, including Chechnya and Taiwan. For these concerns and challenges, Russian and Chinese elites proceeded throughout the quarter in two major policy directions: strengthening the SCO and elevating military-military relations. For this, Putin was more straightforward by saying at the onset of his dinner with Hu that “military-technical cooperation and cooperation in the military sphere are expanding,” reported the Russian official news agency ITAR-TASS.

Beyond the seemingly endless Russian-Chinese summits, other high-level interactions included the visit by Russian Federation Council Speaker Sergei Mironov to China (late September), marking the initiation of regular parliamentary exchanges and the appointment of Sergei Razov as Russia’s new ambassador to China. Although he is 52 and a career diplomat (he served as Russian ambassador to Mongolia and Poland and, prior to his current appointment, as Russian deputy foreign minister), Razov is not a “China hand,” as was his predecessor Igor Rogachev, who had held the position for 13 years. His Chinese major from the elite Moscow State Institute of International Relations and service as a junior officer in the Russian Embassy in Beijing in the mid-1970s, however, are essential credentials for taking over from the 73-year old Rogachev, for whom the Chinese have developed much respect.

SCO: leaps and limitations

Both the spirit and words of the Moscow declaration were reflected in the workings of the Shanghai Cooperation Organization in the third quarter. The final declaration at the July 5 annual summit in Astana, Kazakhstan, states that the international community needs to go beyond the scope of ideology and different social systems, so as to create a new security concept based on mutual trust, mutual benefit, equality, and coordination; and that multilateral cooperation based on equality and mutual respect, non-interference in internal affairs of sovereign states, nonconfrontation thinking, and progressive movement toward democratization in international relations promote global peace and security.

Beyond this high-principled rhetoric, the SCO made during the third quarter the two most significant moves since its founding in 2001. The first was to officially admit India, Iran, and Pakistan as observers. Before this, only Mongolia was granted the status in 2004. With an additional 1 billion people, the SCO now boasts to cover about half the world’s population.

The enlarged scope of the regional security mechanism, however, may not contribute to operational efficiency, given the diverse national interests among members and observers. The decision to grant the three nations observer status without full membership, however, will minimize SCO “growing pains” while maintaining the momentum of development. In principle, SCO membership and observer status do not have geographical limits. The main criterion is that any applicant should be prepared to adopt a respectful attitude toward the SCO and be interested in cooperating with it. At the time of the Astana summit, even the possibility of forming an SCO-Afghanistan “contact group” was explored so as to link the organization with the troubled Central Asian state, which, despite the end of the Taliban regime and the heavy NATO presence, continues to be a major source of religious radicalism, instability, and illegal drug trafficking.

SCO enlargement was somewhat anticipated, which was approved in principle by the SCO foreign ministerial meeting in early June. It was quite “unexpected,” however, that the final declaration of the annual summit included a statement calling on the countries of the antiterrorist coalition in Afghanistan to set final deadlines for the temporary use of their infrastructure facilities and for the presence of military contingents on the territories of SCO countries. “Considering the completion of the active military phase of the antiterrorist operation in Afghanistan, the member states of the SCO regard it as essential that the relevant members of the antiterrorist coalition set final deadlines for the temporary use of the said infrastructure facilities and for the presence of military contingents on the territories of the member countries of the SCO,” said the final declaration by the SCO leaders.

The “consensus” to end U.S. military bases was reached after a rather “emotional” speech by Uzbekistan President Islam Karimov, who referred to the political chaos of his nation a few months before as “managed destabilization” with “a far-reaching geopolitical plan whose aim is the domination of Central Asia.” It was unclear how Karimov’s appeal was translated into the final declaration. President Hu seemed to endorse the SCO base-ending statement only in broad terms. “The peoples of Central Asia have the right to choose their own way of development according to the particularities of their countries,” Hu was quoted as saying. The day after the SCO summit, Moscow appeared to be distancing itself from the initiative as Kremlin officials “categorically” denied that Moscow took part in preparing this proposal. Furthermore, Russian officials at the summit pointed out that “no one is giving anybody ultimatums.”

The statement, therefore, emerged with SCO’s collective cover, presumably to free any member state from being “responsible” for initiating this “anti-American” move. Indeed, the same final declaration also makes clear that members of the regional security mechanism “support and will continue to support the efforts of the international coalition conducting the antiterrorist operation in Afghanistan. We currently note positive dynamics in stabilizing the internal political situation in Afghanistan.” The document also points out that SCO was to combine efforts in the campaign against new threats, but stressed that this did not mean that new blocs are appearing.

In hindsight, it is unclear just how binding the SCO’s “collective” decision to end U.S. basing in its member states’ territories is. Following a trip by U.S. Defense Secretary Donald Rumsfeld to central Asia in late July, Kyrgyzstan essentially reversed its position by continuing U.S. air basing arrangements (Manas Air Base outside the Kyrgyz capital). Uzbekistan, however, is following through the SCO call with a six-month deadline for the U.S. to withdraw from its Karshi-Khanabad Air Base. Regardless, some Russian media went as far as to say that the demand, or proposal, for the U.S. to end their bases was “not serious.”

The SCO’s “bold moves,” however, may not necessarily mean strengthening its operational abilities. In many respects, the regional security forum seems to continue to suffer from a lack of real action and practical means in dealing with various issues. For instance, the seven documents signed in Astana this time included an antiterrorist “blueprint” defining the basic aims, tasks, principles, directions, and forms for cooperation, as well as a mechanism for implementation. This was done four years after its official founding in 2001 and one-and-a-half years after the two permanent bodies of the SCO – the Secretariat in Beijing and the Regional Anti-terrorist Structure (RATS) in Tashkent – were initiated in early 2004 with the very purpose of fighting terrorism, separatism, and extremism. Still, the blueprint does not specify what constitutes terrorism in practical terms. At the end of the quarter, SCO law enforcement institutions were still working on the issue. Thus far, action boils down to developing a “most wanted list” of specific individuals and groups so that security agencies of the SCO states can track them down with more efficiency.

As a result of these deficiencies, Chinese President Hu categorically stated that the SCO’s future depended on whether members could translate consensus into action and render plans into reality, and that members should strive to translate the organization’s potential into results. While referring to SCO’s main function of fighting terrorism, Hu appeared to focus more on the economic side of the organization by calling for deeper economic cooperation and integration. For this purpose, Hu pledged to offer even more preferential terms for the $900 million in buyers’ export credits it promised SCO members at the Tashkent summit last year. Additionally, the Chinese president said that China had set aside a special fund for the training of 1,500 people from other SCO member countries within the next three years. Largely with China’s initiative and coordination, the SCO is close to making major decisions regarding setting up a development fund, a business council, and an inter-banking system.

The Chinese lost no time in following up Hu’s words. Deputy Prime Minister Wu Yi took a 10-day “working tour” of Kazakhstan, Uzbekistan, Turkmenistan, and Tajikistan July 12-22, leading to a number of loans and grants to these states: $300 million to Kazakhstan; $47.3 million to Uzbekistan, which already received $1.5 billion of loans from China in late May; $24 million to Turkmenistan; and $19.3 million to Tajikistan.

For his part, Russian President Putin emphasized that the “pre-emptive principle” should be applied in the fight against terrorism. “I believe that the adoption of a concept like this is a very useful and timely move. The new threats are transnational…and that they are not faceless. There are contractors and executors and it is our task not only to find these people and neutralize them,” argued the Russian leader. The phrase “pre-emptive principle,” however, seemed not solely related to military measures. The final declaration of the SCO summit reads, “It is an urgent task to present unanimous methods and proposals as well as to adopt preventive measures [emphasis added] and conduct related explanations among the people in order to resist attempts to mislead the public opinions. The member states will actively expand cooperation in education, culture, sports, tourism and other fields within the framework of the SCO.” Russia’s thinking about some military mechanism for the SCO, however, was rekindled during the Sino-Russian joint exercise in August. Russian sources were actively toying with the idea of a SCO with “military components” in the future. The Russian-China drill was conducted within the framework of the SCO and was observed by defense ministers of all SCO members.

War games and a war of nerves

The Sino-Russian military exercise, Peace Mission 2005, was the first ever between the two nations. Starting from Russia’s Pacific outpost of Vladivostok Aug. 18, nearly 10,000 Russian and Chinese troops went through an eight-day, three-stage war game along China’s northeastern coastline, which was not seen even in the Sino-Soviet “honeymoon” of the 1950s. In the last phase of the drill, Russian Defense Minister Sergei Ivanov joined his Chinese counterpart Gen. Cao Gangchuan in Qingdao, Shandong Province, together with defense ministers from SCO member states.

On the record, the joint drill was “antiterrorist” in nature, an all-purpose and convenient cover for almost all state activities in the post-9/11 world. The actual components of the Sino-Russian exercises – beach landings, parachuting, blockades at sea, dropping depth charges, firing anti-ship missiles from submarines, precision-guided bombing from strategic bombers, etc. – however, were certainly oversized and looked like overkill. One does not have to question the locations of the joint exercise, which were far removed from land-locked Central Asia where the SCO exercises jurisdiction. While some PRC commentators went as far as to suggest that the terrain of the exercise areas was similar to Taiwan’s coast, the Russian media toyed with the idea of a joint occupation of North Korea, if necessary.

Despite the repeated public statements from the two continental powers that their drills did not mean to imply a threat to any third party, few in the region believed them. Through diplomatic and military channels, the U.S. and its “littoral” allies urged Russia and China to reduce the scope of the exercise or even to cancel it altogether. China and Russia, nonetheless, went ahead. On Aug. 19, Secretary of State Condoleezza Rice delivered an unusually sharp criticism of China’s economic practices, while expressing concerns about China’s military buildup as “outsized for its regional interests.”

While the Chinese and Russians were synthesizing their units and hardware, the U.S. and its allies – declared (Japan and South Korea) and de facto (Taiwan) – were not only watching closely, but also matching the Sino-Russian drill with their own, and much larger, maneuvers. On Aug. 7-13, the U.S. Pacific Command held its Joint Air Sea Exercise 2005 (JASEX ‘05) by its forces in Okinawa and Guam. This largest joint exercise outside the U.S. of the year involved more than 10,000 troops, more than 100 warplanes, and the USS Kitty Hawk carrier strike group. On Aug. 22, South Korea and the U.S. kicked off the 12-day Ulchi Focus Lens 2005 exercise, drawing 10,000 U.S. and an undisclosed number of South Korean troops. Just one day before the Sino-Russian exercise, Taiwan staged a “routine” exercise to “repel” a simulated invasion by the mainland. A joint U.S.-Japan exercise –Yama Sakura  – is scheduled in early 2006.

The Russia-China Peace Mission 2005 exercise was at the center of a war of words and nerves that drove East Asia apart along an emerging fault line between continental and maritime powers. India, another “continental” power, is said to be keenly interested in a trilateral exercise with Russia and China next year. And Chinese Defense Minister Cao Gangchuan, while visiting Russia in September, asked President Putin to have more exercises of this kind in the future. Other SCO member and observer states expressed their desire for more direct and more extensive participation in future multilateral exercises within the context of the SCO.

These developments, and others, occurred at a time when both China and Russia had traveled far from their communist legacies. Perhaps more than at any time in their respective histories, the two countries are closely integrated into the existing international system dominated by the West, particularly the U.S. Indeed, it is against the core interests of both nations to form a military alliance at the time when the rise and rebirth of China and Russia require continuous intercourse with the capitalist world market.

New and different phase of mil-mil relations?

In bilateral terms, the joint exercise was in many respects an outcome of a much expanded military-military (mil-mil) relationship, which, ironically, has been rather lopsided toward confidence building and Russian arms sales to China. The two militaries do not share much of their operating principles and military doctrines despite their “strategic convergence” at the highest level of their civilian leadership. Nor do the militaries of the two nations have any idea how their multi-service and high-tech units and weapon platforms would interface, let alone coordinate, with one another. Perhaps most of the officers and men of the two sides are more comfortable conferring in English-than in each other’s language. With several smaller drills in the past few years along their border regions and within the SCO context, the two sides finally reached an agreement at the end of 2004 to stage an upgraded maneuver. The months leading to the drill, however, were by no means smooth as both sides bargained over the format, scale, components, locations, and sequences of the exercise. In contrast, the numerous maneuvers between the U.S. and its Asian allies are far more integrated. The U.S. dominance in alliance relations, too, ensures operational efficiency of those drills and interoperability of militaries in real time.

Beneath the publicized highly positive statements from both sides over the exercise were not-so-overlapping goals. Beijing is obsessed with Taiwan. Russian Defense Minister Ivanov, however, publicly stated during the exercise that Russia’s joint war game with China did not mean Russia “is prepared to be involved in joint combat operations with China.” If “weapons-but-no-war” is Moscow’s bottom-line, it makes sense for Russia to offer only “sufficient” forces (1,800 vs. China’s 7,000) and carefully chosen weapons systems. “We are not putting up everything we have for sale,” said a high-ranking source in the Russian Defense Ministry. “The main thing is not to damage one’s own security.” The choice of involving Tu-95 and Tu-22 strategic bombers in the drill was to turn these aging platforms into some profit rather than eventually scrapping them. Meanwhile, Russia’s newer Tu-160 never showed up in the war games. It is unclear what exactly the Chinese would like to obtain from Russia. China may purchase a few relatively advanced Tu-22 Backfire strategic bombers as a step toward technology transfers for possible license-production of the Tu-22 in China. That, however, may take a decade to start and cannot be done without many Russian components. The optimal choice for the Chinese military is to have the Tu-160, the top of the line among Russian strategic bombers. Although this is almost impossible, the Chinese defense minister tossed out questions regarding specifics of the Tu-160s during his inspection of the Tu-95 and Tu-22 strategic bombers after the exercise.

The August drill was done when there was seemingly never-ending Russian weapon sales to China. The reality is that in the next few years, many of the large procurements from China will be delivered. The “bulk” sales – hundreds of Su-series fighter-bombers and dozens of naval surface and underwater weapon platforms such as Kilo-class submarines, which has been “normal” in Russian’s sales to China until recently – are unlikely to be repeated. Meanwhile, the end of the EU arms embargo against China appears to be a matter of time. Last if not least, China’s domestic arms industry is fast catching up, filling some obvious gaps between Chinese products and their more advanced foreign equivalents. The timing of the drill in August was therefore crucial for the transition toward a different type of weapons sale mechanism to China.  The fact that many Russian weapon systems used in the exercises – including Tu-95MC and Tu-22M3 strategic bombers, A-50 radar aircraft, Il-78 tanker, Su-24MK frontline bomber and Su-27CKM multipurpose single-seat fighter – were left for display in China for several days after the exercise served Russia’s commercial interests.

Moscow’s effort was paid off a few weeks after the drill when China placed a $1 billion order for 40-some Il-76 and Il-78 (oil tanker) transport planes from Russia. The two sides reportedly also discussed the possibility of upgrading China’s Su-27 to Su-27SM, which has characteristics equivalent to the latest Su-30 fighter but is significantly cheaper.

The deals were made during Defense Minister Cao’s visit to Russia on Sept. 5-9 for the 12^th regular session of the two countries’ commission on military-technical cooperation that was held in Moscow (Sept. 6 when the two sides discussed “strategic questions”) and the Black Sea resort of Sochi in southern Russia (Sept. 8 when they focused on “technical” issues). The Sochi session was clearly arranged as a weapons sale promotion party as Defense Minister Ivanov was accompanied by several Russian military-industrial heavyweight CEOs: Mikhail Dmitriyev, director of the Federal Military Cooperation Service, Sergei Chemezov, director general of the Rosoboronexport state-owned arms trading company, Mikhail Pogosyan, director general of the Sukhoi aircraft holding company, and Vladislav Menshchikov, director general of the Almaz-Antei air defense consortium.

To soften the atmosphere and “sweeten” the deal, a special “presidential” treat was arranged: the Russian-trained Chinese defense minister joined Putin in an informal session. The Russian-speaking Cao, who was trained in the early 1950s in Soviet military academy, is among a fast dwindling number of top officials in China. For his part, Putin tried to relax the Chinese defense minister by offering both beer and reciprocating his Chinese guest with the title of “comrade.”

It was not the first time that the Russians and Chinese referred to each other with the once ubiquitous title of “comrade.” No one at the Sochi party, however, believed that the “good/bad old days” of the former Soviet Union and Mao’s China would return. Ideology has ceased to be an operating factor between Moscow and Beijing. The familiar reference of “comrades” this time, however, seemed to be somewhat more appropriate after the unprecedented military exercise, new military sales to China, and the prospect of more, and perhaps bigger, exercises.

Elevated relations between Moscow and Beijing also occurred against the backdrop of the 60^th anniversary of the end of World War II. A series of commemorations in China and Russia in the third quarter joined by both sides not only marked the final fading away of the “greatest generation” in the two nations, but also, ironically, ushered in the old specter of the Cold War-style division between Russia and China on one side and Japan and the U.S. (and Taiwan?) on the other. It remains to be seen how the geostrategic games in East Asia will be played out.