Shanghai Cooperation Organization (SCO) – Explained, pointwise

Introduction

The 22nd summit of the Shanghai Cooperation Organization (SCO) concluded recently in Samarkand, Uzbekistan. At the end of the summit, member nations signed the Samarkand Declaration, which identified the areas of cooperation to strengthen security and development. In the last 2 decades, the SCO has emerged as a key organization in the Eurasian region. The Organization assumes more importance for India as it gears up for Presidency next year and hosting the summit in 2023. India’s presidency of the SCO shows its new multi-alignment policy; wherein it is delicately balancing membership of SCO (China-Russia led group) with Quad (US-led group). However, as the Russia-Ukraine war prolongs, it presents a new challenge to India’s diplomacy to balance its relationship with both the West and China/Russia led groups.

About the SCO

Origin: The Shanghai Cooperation Organisation (SCO) was formed in June 2001. It had its origins in Shanghai Five that was established in 1996. Shanghai Five, having China, Kazakhstan, Kyrgyzstan, Russia and Tajikistan as members, had emerged from a series of border demarcation and demilitarization talks which the four former Soviet republics held with China to ensure stability along the borders. In 2001, Uzbekistan also joined and the group was rechristened as the Shanghai Cooperation Organisation (SCO).

Members: The SCO has 8 members as of September 2022. These are, India, China, Russia, Kazakhstan, Pakistan, Uzbekistan, Tajikistan, and Kyrgyzstan. India and Pakistan had joined in 2017. Afghanistan, Belarus, Iran and Mongolia have the status of Observers. Iran will join as full member in 2023. In addition, Armenia, Azerbaijan, Cambodia, Egypt, Nepal, Qatar, Saudi Arabia, Sri Lanka and Turkey are dialogue partners. Members of the SCO account for ~40% of the world’s population and ~30% of Global Gross Domestic Product (GDP).

Source: SCO

Structure: The SCO has political economic and security dimensions. The Organisation has two permanent bodies — the Secretariat in Beijing (China) and the Regional Anti-Terrorist Structure (RATS) in Tashkent (Uzbekistan).

The Heads of State Council (HSC) is the highest decision-making body in the SCO. It meets once every year to take decisions and give instructions on all important issues regarding SCO activity. The Heads of Government Council (HGC) meets once per year to discuss a strategy for multilateral cooperation and priority directions within the Organisation’s framework, to solve important and pressing cooperation issues in economic and other areas, as well as to adopt the Organisation’s annual budget.

There are also mechanisms of meetings on the level of Secretaries of Security Councils, Foreign Ministers, Ministers of Defence, Emergency Relief, Economy, Transportation, Culture, Education, Healthcare, Heads of Law Enforcement Agencies, Speakers of Parliament, Supreme Courts and Courts of Arbitration, and Prosecutors General etc.

Russian and Chinese are the official and working languages of the SCO. India is pushing for use of English as working language.

What is the significance of the SCO?

Connectivity and Trade: Given the massive size of the SCO, there is considerable potential in trade and connectivity across the region. SCO members have among them major gas and oil suppliers in the region (Russia, Kazakhstan) and also the largest consumers (China, India). SCO nations are also the largest wheat producers, which includes India. The Samarkand Declaration, signed in September 2022 at the 22nd Summit, centralises connectivity which is a priority for India, as well as energy and food security.

Security: SCO has a key security dimension as well, with security related concerns having a centre-stage. The main threats which are focus of the SCO include terrorism, separatism and extremism. It has been reported that the SCO had foiled 600 terror plots and extradited 500 terrorists through RATS till 2017.

Under the RATS (Regional Anti-Terrorism Structure), it has been proposed to create a unified register of terrorist and extremist organisations whose activities will be prohibited on the territories of the SCO member countries. SCO members also held a joint anti-terror exercise in 2021.

Over the past few years, the organisation’s activities have expanded to include increased military cooperation and intelligence sharing.

What are the challenges with the SCO?

Internal Struggles: Bilateral Relationships of many SCO members are strained. Recent clashes on Kyrgyzstan and Tajikistan border has lead to deaths of more than 100 people. Kyrgyzstan also has a border dispute with Uzbekistan although it is closer to resolution. The relationship of India and China is also at a historic low due to the border dispute and increasing Chinese presence in India’s neighbourhood.

Although Russia and China seem to be united against the West, Russia is vary of growing Chinese presence in Central Asia. Russia considers Central Asia as its own backyard (former Soviet Republics). Russia still retains the military lead in the region through the CSTO (Collective Security Treaty Organisation), but China might soon displace Russia as security provider subsequent to the greater economic integration with the region.

Connectivity: The connectivity has remained poor, especially between India and the other SCO members. Pakistan has blocked all efforts to enhance connectivity with India. China has benefited the most, as all Central Asian nations have joined the Belt Road Initiative.

Terrorism: India has long held Pakistan as a State sponsor of terrorism. The presence of Pakistan, which is under grey list of FATF, severely limits the ability of the SCO to cooperate on the counter-terrorism front. The role of China is also dubious have repeatedly blocked the resolutions of India/US to blacklist Pakistan-based terrorists.

What is the importance of SCO to India?

Relationship with Central Asia: The SCO provides a platform to India to strengthen its relationship with Central Asian nations. The region is rich in energy and mineral resources (including rare earth elements) which are critical to India’s economic growth. Many minerals are vital for new materials which will support transition to clean energy technologies.

Relationship with Russia: India continues to have high dependence on Russia for its energy and defence needs. India sees Russia as a balance to China. Russia, vary of Chinese presence in Central Asia, wants to prop-up India to keep check on China.

Regional Security and Stability: India sees partnership with SCO nations as a crucial factor in regional stability. For instance, India held NSA-level meetings with SCO Members Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan along with Iran and Turkmenistan for Regional Security Dialogue on Afghanistan in November 2021. Central Asian Nations can support India in counter-terrorism despite limited response from China and Pakistan.

What steps can be taken to increase the relevance of SCO for India?

First, The lack of adequate connectivity with the Central Asian Republics (CARs) has been a major constraint for India, especially due to Chinese dominance through the Belt and Road Initiative. So it is necessary to conceive creative measures that enable Indian corporate to expand its footprint in the region’s markets. With Iran joining in 2023, India must leverage its relationship and existing projects (Chabahar) to increase its presence in the region.

Second, Pakistan has to be persuaded to open land corridors which are the cheapest and shortest route. For Central Asian nations, India is a lucrative market as well as a potential investment partner. Rising Chinese debt and experience with BRI projects elsewhere have made them to have second thoughts on Chinese investments. Collective pressure from them on Pakistan to relent, can boost regional connectivity, trade and investments.

Third, India should push for more bilateral trade and settlement in national currencies to reduce dependence on US Dollar and reduce price volatility.

Fourth, There is need to give more focuses on humanitarian ties. Member States are working fruitfully in the field of education, health, culture, tourism and youth contacts and the cooperation should be enhanced further..

Conclusion

SCO is a platform which serve India’s regional interests to ensure nation-building through development partnerships, maintaining sovereignty, preventing the region from terrorism and extremism. The organization has great potential to create a multi-polar, multi-aligned global order. India should enhance its active engagement with the Central Asian Nations to secure its geopolitical interests as well as counter Chinese influence in the region.

Syllabus: GS II, Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

Source: The Hindu, Indian Express, Indian Express,