Asiamaior 26

Asia Maior.
The Journal of the Italian Think Tank on Asia founded

by Giorgio Borsa in 1989.
Copyright © 2016 - Viella s.r.l. & Associazione Asia Maior
ISSN 2385-2526
ISBN 978-88-6728-699-7 (paper) ISBN 978-88-6728-700-0 (e-book pdf)
Annual journal - Vol. XXVI, 2015
This journal of the Associazione Asia Maior is published jointly by

Associazione Asia Maior & CSPE - Centro Studi per i Popoli extra-europei
“Cesare Bonacossa” - Università di Pavia
Editor (direttore responsabile): Michelguglielmo Torri, mg.torri@gmail.com

Junior editor: Nicola Mocci, nicolamocci@yahoo.it
Editorial Board: Axel Berkofsky, Simonetta Casci, Diego Maiorano, Nicola
Mocci, Giulio Pugliese, Michelguglielmo Torri, Pierluigi Valsecchi
Book review editors: Oliviero Frattolillo, oliviero.frattolillo@uniroma3.it;
Francesca Congiu, francesca_congiu@hotmail.com
Graphic design: Nicola Mocci
Asia Maior. The Journal is an open-access journal, whose issues and single
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centro studi per i popoli extra-europei “cesare bonacossa” - università di pavia
ASIA MAIOR
The Journal of the Italian think tank on Asia founded by Giorgio Borsa in 1989
Vol. XXVI / 2015
The Chinese-American Race

for Hegemony in Asia
Edited by
Michelguglielmo Torri and Nicola Mocci
viella
associazione asia Maior
Steering Committe: Marzia Casolari (President), Enrica

Garzilli, Nicola Mocci (Vice President), Riccardo Redaelli,
Michelguglielmo Torri (Scientific Director)
Scientific Board: Guido Abbattista (Università di Trieste), Domenico Ami-

rante (Università «Federico II», Napoli), Elisabetta Basile (Università «La
Sapienza», Roma), Luigi Bonanate (Università di Torino), Claudio Cecchi
(Università «La Sapienza», Roma), Alessandro Colombo (Università di Mila-
no), Anton Giulio Maria de Robertis (Università di Bari), Thierry Di Costan-
zo (Université de Strasbourg), Max Guderzo (Università di Firenze), Franco
Mazzei (Università «L’Orientale», Napoli), Giorgio Milanetti (Università
«La Sapienza», Roma), Paolo Puddinu (Università di Sassari), Adriano Rossi
(Università «L’Orientale», Napoli), Giuseppe Sacco (Università «Roma Tre»,
Roma), Guido Samarani (Università «Ca’ Foscari», Venezia), Filippo Sabetti
(McGill University, Montréal), Gianni Vaggi (Università di Pavia), Alberto
Ventura (Università della Calabria)
CSPE - Centro Studi per i Popoli extra-europei

“Cesare Bonacossa” - Università di Pavia
Steering Committee: Axel Berkofsky, Arturo Colombo,
Antonio Morone, Giulia Rossolillo, Gianni Vaggi, Pierluigi
Valsecchi (President), Massimo Zaccaria
Asia Maior. The Journal of the Italian Think Tank on Asia founded by Giorgio
Borsa in 1989 [hereafter Asia Maior, The Journal] is the journal of Asia Maior
– An Italian think tank on Asia (the legal name of which, in Italian, is:
«Associazione Asia Maior»). Asia Maior is a peer-reviewed journal which has
been classified by ANVUR, the Italian authority in charge of the evaluation
of Italian higher education and research, as a class A journal in the field of
Asia’s history. It is possible to publish in Asia Maior only by invitation; authors
are chosen on the basis of their previous scientific work. However, scholars
with adequate experience, who are willing to publish, are encouraged to
submit their candidacy, accompanied by a curriculum vitae and a paper
whose subject is related to the country which the aspirant author desires to
analyse in Asia Maior.
contents
7 nicola Mocci & MichelguglielMo torri, Foreword: Asia Maior in

2015
19 Francesca congiu, China 2015: Implementing the Silk Road Economic
Belt and the 21st Century Maritime Silk Road
53 barbara onnis & Marco Milani, Korean peninsula 2015: One step
forward and two steps back
93 giulio pugliese, Japan 2015: Confronting East Asia’s geopolitical game
of go
133 salvador santino F. regilMe Jr. & carMina Yu untalan, The
Philippines 2014-2015: Domestic politics and foreign relations, a critical
review
157 elena valdaMeri, Indonesia 2015: The first year of the «People’s
President»
197 stephan ortMann, Singapore 2011-2015: A tale of two elections
213 steFano caldirola, Malaysia 2015: Najib Razak’s hardest year
229 pavin chachavalpongpun, Thailand 2015: Anxiety over the royal
succession in the post coup 2014
245 nicola Mocci, Cambodia 2015: 30 years of Hun Sen’s government and
the progressive centralization of power
265 Michela ceriMele, Vietnam 2014-2015: The strengthening of relations
between Vietnam and the United States
297 pietro Masina, Myanmar 2015: Political turning point, economic and
social challenges
311 Marzia casolari, Bangladesh 2015: The emergence of radical Islam
339 MichelguglielMo torri & diego Maiorano, India 2015: The
uncertain record of the Modi government
407 danila berloFFa, Sri Lanka 2015: The downing of a new era?
445 Marco corsi, Pakistan 2015: Domestic and foreign policy challenges
455 diego abenante, Afghanistan 2015: The national unity government at
work. Reforms, war, and the search for stability
469 Matteo FuMagalli, Kyrgyzstan 2015: A country adrift
483 Fabio indeo, Turkmenistan 2015: Existing challenges to the permanent
neutrality and the strategic development of the multivector energy policy
501 aniseh bassiri tabrizi & claudia castiglioni, Iran 2013-2015: In
the midst of change
527 Reviews
535 Appendix
Asia Maior, XXVI / 2015 5

Foreword: asia Maior in 2015
As has been pointed out in the foreword of the previous Asia Maior volume,
Asia – even the portion of it that the Asia Maior think-tank defines as «Asia
Maior», namely Asia south of the Caucasus and Siberia and east of Turkey
and the Arab countries – is a profoundly diverse area, basically devoid of
any unity geographically, politically, culturally, economically or socially.1
Given this situation, identifying one or more developments which can be
considered as characterizing the evolution of even the majority of Asia
Maior is always a difficult task.
However, in 2015 – the year under analysis in the present volume –
at least three core developments appear to have been important enough
to immediately catch the attention of attentive observers. Moreover, apart
from these more conspicuous developments, some others, perhaps less
immediately noticeable but equally important, are worth singling out.
Accordingly, we shall organize this concise foreword in two parts: in the
first, the most conspicuous and immediately evident developments which
have characterized Asia Maior in 2015 will be briefly discussed; then, in the
second part, we shall go on to briefly present some additional developments
which, although less immediately visible, are important to understand in
order to have an accurate overview of the evolution of Asia Maior.
As said above, there were three main and immediately visible developments
which characterized Asia Maior in the year 2015. The first was the Chinese
fulfilment of the first phase of a gargantuan political-economic project: the
Silk Road Economic Belt and 21st Century Maritime Silk Road, known also
as the «One Belt, One Road» (OBOR) initiative.
The second element was the successful conclusion the TPP (Trans-
Pacific Partnership) negotiation by its main sponsor, the United States,
as well as 11 Pacific Rim countries, including five Asian countries: Japan,
Singapore, Brunei, Malaysia and Vietnam.
The third element was the July 2015 nuclear agreement between Iran
and the P5+1 (the UN Security Council’s five permanent members, namely
China, France, Russia, the United Kingdom and the United States, plus
1. Michelguglielmo Torri, ‘Foreword: Asia Maior and its Asia’, Asia Maior 2014,
p. 12.

Nicola Mocci & MichelguglielMo Torri
Germany). This agreement established the possibility of a more dynamic role

for Tehran on the international stage and (more specifically) in West Asia.
The TPP treaty and the OBOR initiative are the two competing
strategies adopted by the two major powers active in Asia Maior – namely
the US and China – while pursuing their respective hegemonic strategies
in that geopolitical area. These two competing strategies are intertwined
with and to a large extent condition the strategies adopted by countries
such as India and Japan, aimed at strengthening their own position on
the international stage by projecting themselves as leaders at the regional
level. Seen from this perspective, the political change determined by the
progressive reintegration of Iran into the international system widened the
area in which the hegemonic dynamics of the two major powers (US and
China), plus the expansive economic strategies of some intermediate ones,
in particular India and the EU countries, played themselves out.
It is in this context that China’s foreign policy must be seen. Since
1978, the Chinese Communist Party (CCP) has legitimized its own power
with reference to the economic growth made possible by its policies. As a
consequence, the legitimization of the party has gradually moved from an
ideological motivation, namely the reference to the revolutionary model,
to an economic and financial motivation, namely the long-term and truly
impressive economic growth experienced by China since 1978. This shift,
however, implies a risk: the PCC political legitimization cannot help but
be in danger whenever the growth of the economy slows down – as has
happened in recent years – and, by slowing down, highlights and deepens
the growing socio-economic inequalities which are the necessary by-product
of the Chinese growth model.2 Therefore, supporting economic growth has
become the priority of the Chinese state. In the past few years, an integral
part of this strategy has been the ‘Go Global’ policy, aimed at making possible
massive Chinese investments abroad. As shown by Francesca Congiu in the
present volume, China has pursued this objective by launching, in 2013,
what has more recently been termed the OBOR.
The OBOR project does not simply aim to encourage Chinese
public investments abroad in order to support the national economy, it
also pursues two additional targets, both crucially important. One is to
guarantee the uninterrupted and easy flow of raw materials – particularly
energy resources – into China’s economy, accompanied by the reverse flow
of China’s products directed to the international market; the other target is
the attempt to mitigate fears related to what is often seen as Beijing’s over-
aggressive assertiveness on the international stage.
This dynamic Chinese foreign policy has been countered by an equally
dynamic US foreign policy. US hegemony in Asia was built, after the Second
2. For a discussion of these problems see Francesca Congiu, ‘Cina: lavoro al

centro’, Asia Maior 2010, pp. 289 ff.
8
Foreword
World War, on three pillars: military supremacy, economic supremacy and

cultural hegemony, i.e., the acceptance by a large part of the international
community of this supremacy as something beneficial for all.3 However, the
grip of US power on Asia has started to slowly loosen since the 1970s. With
the beginning of the world economic crisis in 2008, the decline of US power
in Asia became suddenly more pronounced and increasingly visible.4
Once the long term decline of US hegemony has been pointed out,
it must be put into perspective; the three pillars on which US hegemony in
Asia and across the world has been based may be weakening, but the US
economy remains the biggest on the planet, its military the most powerful
and its cultural hegemony still basically unchallenged. In fact, the US
remains the pole of attraction and the preferred residence and workplace
of the most brilliant brains worldwide. As a consequence, US superiority
in advanced technologies, both military and non-military, rather than
declining appears to be surging. Last but not least, US hegemony, although
weakened, appears to be propped up by a complex network of overlapping
military and economic alliances.5 Given this situation, it was only to be
expected that Washington would find the will and the resources to launch
a set of ad hoc strategies aimed at containing and hopefully reversing the
process of decline. Perhaps the most important of these strategies, at least
in the foreign policy field, has been the Obama administration’s launching,
in 2009, of the so called «Pivot to Asia».
If observed from the standpoint of long-term US policies in Asia –
at least in East and South-east Asia – the Pivot to Asia can be considered
the fourth stage of a process which began at the end of the 19th century.
The first, soon after the 1898 Spanish-American war and the consequent
sudden surge of US power in Eastern Asia, was the «Open Door» policy,
aimed at maintaining a formally independent China open to economic
exploitation by the Western powers. The second stage, which started after
the 1949 communist conquest of mainland China, was the anti-communist
3. On the concept of cultural hegemony, which we prefer to the more recent

and more undetermined concept of «soft power», see Quintin Hoare & Geoffrey
Nowell Smith (eds.), Selections from the Prison Notebooks of Antonio Gramsci, New York:
International Publishers, 1971 (1st edn.), the pages listed at p. 480, under the voice
«hegemony».
4. On the decline of the American hegemony see Immanuel Wallerstein, Alter-
natives: The United States Confronts the World, Boulder, CO: Paradigm Publishers, 2004;
Giovanni Arrighi, ‘Hegemony Unravelling-1’, New Left Review, No. 32, March-April
2005, and ‘Hegemony Unravelling-2’, New Left Review, No. 33, May-June 2005. That
thesis was fleshed out by its author in Adam Smith in Beijing: Lineages of the 21st Century,
London: Verso, 2007. See also Michelguglielmo Torri, ‘Declino e continuità dell’ege-
monia americana in Asia’, Asia Maior 2009, pp. 9-31.
5. Vince Scappatura, ‘The US ‘Pivot to Asia’, the China Spectre and the Austral-
ian-American Alliance’, The Asia-Pacific Journal, Vol. 12, Issue 36, No. 3, September
9, 2014.
9
containment. The third stage was heralded by Richard Nixon’s speech in

Guam, in 1969, setting out the doctrine which was to be known by his name.
The Nixon Doctrine de-emphasized the direct usage of force by the
US and privileged diplomatic engagement with both the Soviet Union
and Communist China. Although the application of the Nixon Doctrine in
the following decades was not linear, with its dramatic interruption due to
George W. Bush’s post-9/11 proactive military policy in Central and East Asia,
it still remained the reference paradigm of US foreign policy in East, South-
east and South Asia, even after 2001. It introduced what Douglas Stuart and
William T. Tow allude to as «hegemony light» on the part of the US.6 In Colin
S. Gray’s words, this boiled down to «a primacy expressed more in leadership
than in actual application of the mailed fist», as the latter was bound to be
unsuccessful if employed, with little discrimination, «as the principal weapon
in the U.S. strategy arsenal». Indeed, American military power was still
considered as absolutely essential, but only as «the option of last resort»,
namely «a strategy more potent as threat than it is in action».7 Finally, the
fourth stage was the «Pivot to Asia», which, as stated by Douglas Stuart and
William T. Tow: «is best understood as an effort to preserve ‘hegemony light’
in the face of an unprecedented shift in global power from West to East».8
The «Pivot to Asia» is clearly articulated in two contextual action plans:
the first is the US policy to guarantee its continued financial assistance and
military protection to its historical allies in Asia: Japan, Singapore, The
Philippines, Malaysia and (ironically enough) its former archenemy of the
1970s, Vietnam. The second action plan is represented by the attempt –
through the TPP treaty – at creating a gigantic US-dominated free trade
area, encompassing both the Americas and East and South-east Asia.
On 4 February 2015, with the signing of the TPP treaty by 12
nations and the finalisation of the text of the treaty by the respective Trade
Ministers on 5 October 2015,9 the US reached a first crucial turning point
in its strategy, aimed at maintaining and strengthening its hegemony in Asia
(and as a consequence, worldwide). In fact, the building of a free trade area
including 12 Pacific Rim countries, which has usually been described as an
6. Douglas Stuart & William T. Tow, Setting the context, in William T. Tow and
Douglas Stuart (eds.), The New US Strategy Towards Asia: Adapting to the American Pivot,
New York: Routledge, 2015.
7. Colin S. Gray, After Iraq: The Search For A Sustainable National Security Strategy
(http://www.strategicstudiesinstitute.army.mil/pdffiles/PUB902.pdf).
8. Douglas Stuart & William T. Tow, Setting the context, p. 3. See also Dong Wang,
The United States and China: A History from the Eighteenth Century to the Present, Lanham:
Rowman & Littlefield, 2013.
9. Rebecca Howard, ‘Trans-Pacific Partnership trade deal signed, but years of
negotiations still to come’, Reuters, 4 February 2015. The pact was finalized on 5
October 2015, by the Trade Ministers of the 12 countries involved. See Matthew P.
Goodman & Scott Miller, ‘The Trans-Pacific Negotiations conclude’, Center for Strate-
gic and International Studies, 5 October 2015.
10
Foreword
attempt to exclude and encircle China, has a different, more ambitious and
politically more sophisticated objective. As argued by Francesca Congiu in
this volume, the US aims less at implementing a policy of containment vis-
à-vis China than at inserting China into an economic space where the rules
are written by the US. In so doing, the US aims to reach an objective which it
has pursued since the time of the «Open Policy», namely getting rid of those
tariff and non-tariff barriers which, since the 19th century, have prevented
the US from freely entering and dominating the Chinese market.
As we have seen, both China and the US aim to strengthen their
international position by making use of their economic leverage. But,
from this point of view, there is a radical difference in the way in which
the two powers have been moulding their respective strategies since the
beginning of the present century. The US, after the military difficulties it
experienced in Iraq and Afghanistan, has shifted from a dominance model
which privileged military might and its ruthless usage to a new hegemonic
model based almost exclusively on economic supremacy. China, on the
other hand, after having built its hegemony on its extraordinary economic
growth, presently seems bent on reinforcing it by building up its military
might. As Giulio Pugliese shows in the present volume, in 2015 China has
become more accommodating in the East China Sea in the face of Japan’s
economic and military-diplomatic containment strategies; however, this has
simply made Beijing refocus its energies on strengthening its position in the
South China Sea, by implementing a massive building programme on the
disputed coral reefs and rocks of the Spratly Islands.
China’s activism in the China Seas only serves to increase the feeling
of threat experienced by some Asian countries, including Japan. For its part,
the Abe government has reacted by bargaining over the US’ new security
guidelines, in exchange for Japan’s signature on the TPP treaty.
The TPP treaty, as shown by Michela Cerimele in the present volume,
has an explicit exclusionary function towards those economies which are
not part of the TPP. As, at this stage, the TPP treaty does not include China
and the Japanese and Chinese economies are characterized by a high level
of interdependence, China is forced to compete with the US and the other
TPP signatories at a disadvantage in the crucially important Japanese
market. Significantly, this is the same kind of strategy that, in the 1980s and
1990s, was employed by the US and its allies to draw China inside the World
Trade Organization (WTO).10
Most Asian countries – with the notable exception of North Korea,
which is completely isolated – have expressed their interest in participating
in either the Chinese OBOR or the US-sponsored TPP treaty. The launching
in 2015 of the «Cotton Route» project by New Delhi does not change this
10. Negotiations between the WTO and China started in 1986. They continued
for 15 years, until the signing of the Treaty of Accession by China in 2001.
11
general picture, as India does not seem to have the resources to convincingly
and effectively implement this project. Indeed, the «Cotton Route», if it ever
takes shape – which is, by itself, a doubtful proposition – does not seem up
to entering into direct competition with the OBOR or TPP projects. In this
context, the goal of the lesser Asian countries – or, rather, the goal of their
ruling elites – appears to be to take advantage of the trickle-down effects of
one or both of the OBOR or TPP-related development policies. This is done
without much concern for the possible adverse socio-economic fallouts of
such projects.
In this context, it is worth stressing that the TPP treaty, although
presented as a trade agreement, is not mainly about trade, as shown by the
fact that, out of its 30 chapters, only six deal with traditional trade issues.
The remaining 24 chapters aim to attenuate the local regulations in key
sectors such as environment, health and labour, through an unspecified
process of normative «harmonization». Also, the negotiation of the TPP
treaty has been surrounded by secrecy, its contents going without debate in
the parliaments of the countries involved. All this should have raised doubts
about the real advantages of the treaty, particularly for the working classes
and the weakest among the countries involved. However, curiously enough,
the TPP-related negotiations have not aroused either a particular interest or
triggered any sustained protests in the signatory countries.
Whereas the three developments discussed above are the ones which
immediately appear to characterize the evolution of Asia Maior in the year
under review, two more need to be singled out and briefly appraised: the
vicissitudes of democracy and the evolution of the economy.
In the foreword to the previous Asia Maior volume, «the lack of unity
as far as the political systems of the several Asian countries are concerned»
was stressed and the point was made that: «Indeed, one could claim that
practically all kinds of political regimes are nowadays present in Asia Maior,
ranging from the biggest democracy in the world, India, to the most bizarre
dictatorship on the planet, North Korea.»11 Once this has been pointed
out, the fact remains that, out of 20 Asia Maior countries examined in
the present volume, 17 have political systems which are fully democratic,
partially democratic, or somewhat democratic. Accordingly, the situation
ranges from the largest democracy in the world, India, which remains a
full-fledged democracy, although crisscrossed by authoritarian tendencies,
to regimes which, borrowing from Stephan Ortmann’s article in the present
volume, can be accurately defined as «electoral authoritarian regimes», to
the peculiar Iranian case, where a democratic system is enclosed in the
«womb» of an authoritarian one.
11. Michelguglielmo Torri, ‘Foreword: Asia Maior and its Asia’, p. 12.
12
Foreword
Looking at things from this perspective, it is worth noting that out of

the 17 Asia Maior countries analysed in the present volume and characterized
by either democratic, partially democratic, or somewhat democratic systems,
four (Singapore, Myanmar, Sri Lanka, Kyrgyzstan) went through either
national parliamentary or presidential elections or both in the year under
review, four more (Indonesia, Bangladesh, India, Afghanistan) did the same
in 2014 and an additional three (Cambodia, Pakistan, Iran) went to the
polls in 2013. In other words, more than half of the 20 Asia Maior countries
analysed in this volume went to the polls in the last three years, which, at least
at first sight, appears to be an encouraging indicator towards the widening
reach of democracy. Only one Asia Maior country, namely Thailand, went in
reverse, because of the military coup in 2014.
Proceeding westward in our analysis of the elections (and without any
pretension of establishing a hierarchy to their importance), some of their
distinguishing features are worth highlighting. In the small but strategically
and economically important city-state of Singapore, the 2015 parliamentary
elections saw the apparent reverse of the political trend set in motion by the
2011 elections. The 2011 elections had witnessed an impressive surge of
the opposition, while the 2015 elections saw a major defeat for opposition
and the strengthening of the ruling party, namely the People’s Action
Party (PAP). However, the PAP, in spite of its victory – favoured, as shown
by Stephan Ortmann in this volume, by exceptional circumstances – saw
the scope of its power severely reduced by the necessity to be much more
receptive than before to the popular will.
In Myanmar, a parliamentary election – and at long last, a free one
– witnessed the landslide victory of the Aung San Suu Kyi-led party, the
National League for Democracy, meaning that the Union and Solidarity
Development Party, the parliamentary front of the army, was unseated.
While this victory – rightly assessed by Pietro Masina in the present volume
as a historical one – was an undoubted triumph of democracy, its results were
bound to be restricted by both the limitations of the elected government’s
powers and the conspicuous residual political powers allowed to the army
by the existing constitution.
In Sri Lanka, in January 2015, the victory at the presidential elections
of Maithripala Sirisena, the candidate of the united opposition, marked
another historical triumph for democracy, putting an end to Mahinda
Rajapaksa’s increasingly authoritarian regime. In August, the presidential
election was followed by the parliamentary election, which saw a huge
popular participation (70% of the electorate) and confirmed the electoral
trend initiated by the January poll. Indeed, the forces hostile to the former
Rajapaksa regime and favourable to the new presidency, although missing
the absolute majority of the parliamentary seats, gained the upper hand,
confirming the decline in power of the former president and his political
supporters. Already before the parliamentary election, the new president
13
brought about a limitation of the extensive powers given to the presidency

by Rajapaksa in 2010. After the parliamentary elections, the new premier,
Ranil Wickremesinghe, in his 5th November speech, outlined a «Third
Generation Reforms Plan», sketching out an impressive socially progressive
reform programme. However, the wounds opened by the long civil war –
such as the heavy militarization of the Northern region and the draconian
Prevention of Terrorism Act – were left untouched.
Finally, in Kyrgyzstan, the October parliamentary elections confirmed
the hegemony of the pro-president parties, yet did not alter a general situation
characterized by uncertainty and the lack of a clear-cut political project.
Whereas, at the time of writing, it is too early to clearly assess the
consequences of the elections in Singapore, Myanmar, Sri Lanka and
Kyrgyzstan, it is possible to attempt to do so in the case of the Asia Maior
countries which went to the polls in 2014 and 2013.
Maybe the most interesting among these cases is that of Indonesia,
the third largest democracy in the world (after India and the USA). Here,
the 2014 presidential election was won by Joko Widodo, a politician who was
unconnected to the corrupt, authoritarian and largely criminal «New Order»
of President Suharto. As such, President Widodo was seen as an expression
of a surging democratic wave. Unfortunately, as shown by Elena Valdameri
in this volume, at the end of 2015 the record of the new president was a
mixed one; the hoped-for change, although not totally absent, was limited,
as Joko Widodo appeared either unwilling to or incapable of challenging
the well-entrenched, New-Order-related conservative forces present both
inside and outside the government coalition.
An equally interesting case (and a revealing one) is that of India,
the world’s largest democracy. Here, the 2014 general election saw the
landslide victory of the Bharatiya Janata Party, the Narendra Modi-headed
parliamentary front of the Hindu right. After the elections and during the
whole year under review, an atmosphere of growing intolerance against
non-Hindu minorities and free thinkers became increasingly apparent.
Acts of intimidation and open violence, sometimes with deadly results,
were organized and/or carried out by Hindu activists, while the government
turned a blind eye to – or, sometimes, was taking an apologetic stand vis-
à-vis – these fascistic aggressions. The organizations which promoted such
violence showed that they had learned from the anti-Muslim Gujarat
pogrom of 2002. Massive violence – as was the case in 2002 – is bound
to bring the undesired attention of the international community; on the
contrary, «chirurgical» violence, applied to single individuals or small
groups, easily remains under the radar, particularly if the perpetrators are
not Muslims. But the effects of this widespread «low-intensity» violence are
equally terrorizing for the social groups which are its victims, generating
a situation where the democratic space is increasingly and severely
constrained.
14
Foreword
In the year under review, Bangladesh, which went to the polls in January
2014, still appeared as a democracy, albeit one living under a kind of siege.
On the one hand, it was still dealing with those politicians who, although
active and vicious accomplices of the Pakistani army in the 1971 genocidical
war waged against the Bangladeshi people, had later resurfaced as partners of
some post-independence governments. On the other hand, the Bangladeshi
democracy confronted, not without uncertainties and weaknesses, a wave of
murderous and wanton violence by radical Islamic groups.
In Afghanistan, after the end of the Karzai era, brought about by
the 2014 presidential election, political power was shared between Ashraf
Ghani (who took over the presidency) and Abdullah Abdullah (appointed
chief executive officer, i.e., prime minister). However, the relations between
Ghani and Abdullah were characterized by profound disagreement, making
it difficult for them to implement any kind of coherent policy and impossible
for the political system, particularly the electoral process, to be reformed.
Cambodia, which went to the polls in July 2013, celebrated the 30th
anniversary of Hun Sen’s prime-ministership in 2015, which, by itself, does
not seem an indicator of good health for a democracy. In fact, after the 2013
elections, social conflict has exploded virulently throughout the country and
has been confronted by the government with repression and violence.
In Pakistan, the 2013 elections were the first in the whole history of
the country to see a democratic transition from one elected parliament to
another elected parliament. However, two years later, Pakistan’s democratic
institutions remain weak and appear largely subordinated to the army’s
political will.
In Iran, the 2013 presidential election, which saw Hassan Rouhani’s
victory, gave him the possibility to negotiate and finally, in the year under
review, conclude a crucially important deal with the P5+1 countries,
including the US, which promised the early reintegration of the Middle
Eastern country into the international community. However, developments
in Iran on the domestic front remained disappointing. Political and social
freedoms continued to be severely limited, while the economy’s situation
remained unsatisfactory.
Summing up, while democracy is undoubtedly at work in Asia Maior,
sadly its results and the benefits for the people at large are, most of the time,
disappointing.
The above notes on democracy in Asia Maior are far from exhaustive,
as for the sake of brevity they are limited to those countries which went
through the electoral process in the period 2013-15. However, they are
sufficient to highlight once again that political systems in Asia Maior vary
along a spectrum, from full-fledged democracy, as in India, to a kind of dual
system where democracy gestates inside an openly authoritarian system, as
15
in Iran, to what appears, to a large extent, to be the ideal type of an autho-

ritarian regime, namely North Korea.
Although heterogeneous, this situation is less so than it may appear
at first sight. As argued by Emanuela Dalmasso, today democracy and
authoritarianism, rather than two opposing poles, can be viewed as part
of the same continuum.12 This continuum is what French scholars Oliver
Dabène, Vincent Geisser and Gilles Massardier have characterized as: «[an]
authoritarianism with a human face, that spares no country, no political
regime, no system, no transnational organization, but whose substantiating
‘traces’ and salient ‘expressions’ can be found in almost all ‘situations’ and
political ‘logics’ which unfold before our eyes at the dawn of the twenty-first
century».13
Last but not least, some words must be expended on the economic
trends in Asia Maior. Without giving the data for the individual countries,
which are available in the related articles in the present volume, the point
can be made that in 2015 the Asia Maior countries’ GNP, although growing
less rapidly than before, neared a respectable 6% increase.14 As pointed out
by ADB Chief Economist Shang-Jin Wei: «The region’s growth [was] sup-
ported by vibrant private consumption in the PRC [People’s Republic of
China] and expanded industrial production in India and other countries.
At the same time, countries reliant on commodities [were] hurting from the
global slump in prices, and the slower-than-expected recovery in the US
and economic contraction in Japan will continue to [adversely] weigh on
export prospects».15
On the whole, in 2015, economic growth appeared to be sustained in
East and South Asia – where it reached 6% and 6.9% respectively; less so in
South-east Asia, where it was 4.4%, while it was remarkably slower in Central
Asia, where the local economies, hit by «continued low commodity prices,
12. Emanuela Dalmasso, On fait du lobbying. Transizione democratica e movimento

delle donne in Marocco, Tesi di dottorato, Università di Torino, 2010, pp. 60-62.
13. «[un] autoritarisme à visage humain qui n’épargne plus aucun pays, aucun
régime, aucun système, aucune organisation transnationale, mais dont on trouverait
des ‘traces’ probantes et des ‘expressions’ saillantes dans la quasi-totalité des ‘situa-
tion’ et des ‘logiques’ politiques qui se déploient sous nos yeux à l’aube de ce XXIe
siècle». Oliver Dabène, Vincent Geisser, Gilles Massardier, La démocratisation contre la
démocratie, pp. 7-28, in Oliver Dabène, Vincent Geisser, Gilles Massardier, Autorita-
rismes démocratiques et démocraties autoritaires au XXIe siècle, La Découverte, Paris 2008,
p. 20, quoted ibid., p. 62.
14. According to the Asian Development Bank (ADB), the average growth in
Asia was 5.8% in 2015. Asian Growth to Match Forecasts, Remain Steady in 2015, 2016 –
ADB, News Release, 3 December 2015. Asia, according to the ADB, largely but not
exactly coincides with Asia Maior, as it does not include Iran.
15. Ibid.
16
Foreword
particularly oil and gas» and unaided by «the slow recovery in the Russian
Federation», recorded a 3.2% GNP growth.16
On the whole, economic growth in Asia Maior appeared to be towed
along by China and India, which recorded a GNP growth of just under 7%
and just over 7% respectively.17 This in turn means that, in 2015, India’s
rate of growth overtook China’s, making India the fastest growing economy
among the major world economies. However, India’s success should not
obscure two significant points. The first is that, as pointed out by Diego
Maiorano and Michelguglielmo Torri in the India-related article in this
volume, India’s quicker economic pace might be, at least in part, the
result of a new statistical methodology, whose soundness is not beyond
criticism. Moreover – and much more relevant because it is a fact rather
than a speculation – in 2015 China’s economy was still four times the size of
India’s. As pointed out once again by Diego Maiorano and Michelguglielmo
Torri, who quote well-known Indian statistician Ashish Kumar, should
India continue to grow at the same speed as in 2014-15 and should China
continue to perform at the lower level of the last few years – both of which
are highly doubtful propositions – then India would still need 20 to 30 years
to catch up with China.
At the end of the day, the truth is that, in the foreseeable future, China
remains the economic «locomotive» of Asia. Therefore, for the time being,
India’s evident ambition to be considered on a par with China and possibly
supplant her as the leading Asian country remains nothing more than very
wishful thinking.
N.M. & M.T.
16. Ibid.
17. Ibid.; Asian Development Outlook 2015 Supplement: Growth Holds Its Own in
Developing Asia, Publication, December 2015.
17
china 2015: iMpleMenting the silk road econoMic belt and
the 21st centurY MaritiMe silk road
Francesca Congiu
University of Cagliari
fcongiu@unica.it
The present article sees as the most important political-economic development in Chi-
na in the year 2015 the fulfilment of the first phase of a gargantuan political-eco-
nomic project: the Silk Road Economic Belt and 21st-Century Maritime Silk Road,
known also as the «One Belt, One Road» (OBOR) initiative. This project, launched
by the Chinese government in 2013, was institutionalized in a programmatic do-
cument in 2015. Therefore, the present article analyses the OBOR initiative from
several different perspectives. First, the Silk Road project is presented as the current
phase of a long-term political-economic strategy aimed at internationalizing the Chi-
nese state-owned and private enterprises. Then, the article examines the OBOR’s
programmatic official document, published during the year under review, and goes
on to explore the OBOR’s geographic extension and its implementation. Finally, the
article deals with the OBOR’s main financial mechanism, known as the Asian Infra-
structure Investment Bank, and with the Western countries’ divided reactions when
confronted with the opportunity to become founding members of this new China-led
multilateral financial institution.
1. Towards a re-construction of a new «New International Economic Order»?
The main theme of this article is detailing the rationale and genealogy
behind China’s attempt at realizing a gigantic political-economic plan known
as the Silk Road Economic Belt and the 21st Century Maritime Silk Road.
This attempt, which reached an apex in 2015, namely the year under review,
had gradually been taking shape in the past years. In order to situate the Silk
Road strategy, this opening section is focussed on sketching out the role of
China in the changing international landscape, as it evolved during and after
the Cold War era up to formulation of a twin Silk Road strategy.
The People’s Republic of China (PRC), before establishing diplomatic
relations with the United States and launching those policies of reforms in
1979 that converted her to capitalism, had played an important part in the
international movement known as Third-Worldism or Non-Aligned Move-
ment. The PRC had indeed been present at the Bandung Conference in 1955
and at the Tri-continental Conference in 1966 in Cuba, namely the two most
institutionalizing moments of the movement. Third-Worldism reached its
apex in 1974, when the sixth special session of the United Nations General
Assembly adopted the Programme of Action on the Establishment of a New Inter-

Francesca congiu
national Economic Order. According to the programme, the New International

Economic Order (NIEO) was founded in order to assist developing countries
«In view of the continuing severe economic imbalance in the relations be-
tween developed and developing countries…».1 As recently argued by Associ-
ate Chancellor and Chief of Staff at UC Berkeley, Nils Gilman, NIEO was an
effort «to transform the governance of the global economy to redirect more
of the benefits of transnational integration toward the developing nations».2
The programme, divided into ten chapters, seemed effectively aimed at re-
structuring the pattern of international trade and the flow of capital in such
a way that the benefits could have been impartially distributed. Developing
countries were asking, just to quote some of their claims, for preferential trade
access to developed countries’ markets, greater aid to the least developed,
favourable debt rescheduling, and regulation of transnational corporations
making them compliant with national laws.3
Looked at from this perspective, which is the one propounded by an
important part of the extant International Political Economy literature,4 the
main issue at stake during the Cold War era was the capacity to regulate the
global economy and to lure other countries to adopt a particular econom-
ic model. The NIEO was based on a state-centred economic-development
model towards which most developed countries had major reservations, be-
cause they felt that it could severely damage the market-based international
economic system prevailing outside the USSR sphere of influence. Since the
second half of the 1970s, NIEO’s state-centred economic development model
was gradually outstripped by the free-market mantra of fiscal austerity (for
public expenditure), deregulation and privatization, establishing the hegem-
ony of a US-centred neoliberal approach over the global economy even be-
fore the official termination of the Cold War. Looking at the Chinese case, the
NIEO model had probably become obsolete, even before its launch, following
Mao Zedong and Richard Nixon’s meeting in Beijing in 1972.5
1. United Nations, Resolution Adopted by the General Assembly 3202 (S-VI). Pro-
gramme of Action on the Establishment of a New International Economic Order, 2229th Plenary
Meeting, UN Documents, Sixth Special Session of the United Nations General Assem-
bly, 1 May 1974 (http://www.un-documents.net/s6r3202.htm).
2. Nils Gilman, ‘The New International Economic Order: A Reintroduction’,
Humanity: An International Journal of Human Rights, Humanitarianism, and Development,
vol. 6, n. 1, Spring 2015, pp. 1-16.
3. United Nations, Resolution Adopted by the General Assembly 3202 (S-VI). Pro-
gramme of Action on the Establishment of a New International Economic Order, 2229th Ple-
nary Meeting.
4. Joyce Kolko & Gabriel Kolko, The Limits of Power: The World and United States
Foreign Policy, 1945-1954, New York: Harper and Row, 1972; Mark T. Berger, The
Battle for Asia. From Decolonization to Globalization, London: Routledge 2004; Massimo
Galluppi, Rivoluzione, controrivoluzione e politica di potenza in estremo. oriente 1950-1975,
Napoli: L’Orientale 2009; Leo Panitch & Sam Gindin, The Making of Global Capitalism.
The Political Economy of American Empire, London, New York: Verso 2012.
5. Michael Hudson, Global Fracture – New Edition: the New International Economic
20
China 2015
From that point on and until the emergence of the on-going global eco-
nomic crisis, China has always demonstrated her willingness to accept the
US-led global economic governance, while at the same time, cautiously pro-
ceeding on the path in structural reforms for fears of an internal legitimacy
crisis. An example of this is the US’s role in promoting the formidable re-
form of state-owned enterprises realized by China in the 1990s. According to
Charles Freeman III, «…not surprisingly, the most active and forceful source
of external pressure was the US which, through the negotiating team led by
the US Trade Representative, sought to make China’s commercial regulatory
landscape as friendly to US sectoral interests, and thus similar to US eco-
nomic structures, as possible».6 It is also worth stressing that the reform of
state-owned enterprises was the price that China had to pay to access the
World Trade Organization in 2001.
Since 2008-9, however, China’s role in the international system has
gradually changed. Several intertwined factors affected this dramatic change,
among which the most significant ones were China’s role in the 1997 Asian
Financial Crisis, the Chinese government’s push for outwards direct invest-
ments, the growing weights of emerging economies other than China (India,
Russia, Brazil, South Africa), the 2008-9 crisis of the neoliberal economic or-
der, and the military tensions in the East and South China Seas. Eventually,
China’s response to this complex set of crises was the launching of an ex-
tremely ambitious new strategy in 2013. This strategy – which, mutatis mutan-
dis, brings to mind the NIEO project – is articulated in the «Silk Road Eco-
nomic Belt» and the «21st Century Maritime Silk Road», in practice, the two
sides of the same project, also known as the «One Belt, One Road» initiative
(OBOR) (yi dai, yi lu).
2. The taking shape and the meaning of the new Silk Road strategy
The new Silk Road or OBOR strategy’s main aim is to build an inte-
grated set of transportation infrastructures along the land and maritime
trade routes that two thousand years ago linked China to Europe through-
Order, London: Pluto Press 2005; Vinod K. Aggarwal & Steve Weber, ‘The New Inter-
national Economic Order’, Harvard Business Review, 18 April 2012; Patrick Sharma,
‘Between North and South: the World Bank and the New International Economic Or-
der’, Humanity Journal Blog, 19 March 2015 (http://humanityjournal.org/issue6-1/be-
tween-north-and-south-the-world-bank-and-the-new-international-economic-order);
Patrick Sharma, ‘The Rich Countries’ Substitute for the NIEO’, Humanity Journal
Blog, 13 April 2015 (http://humanityjournal.org/blog/the-rich-countries-substitute-
for-the-nieo).
6. Charles W. Freeman III, ‘The Commercial and Economic Relationship’, in
David Shambaugh (ed.), Tangled Titans. The United States and China, Lanham Mary-
land: Rowman and Littlefield Publishers, Inc. 2013, p. 185.
21
Francesca congiu
out the Middle East, Central Asia, and East Africa. In 2015, the project
was formalized through the presentation of an official document during the
Boao Forum for Asia (an annual economic dialogue held in China’s Hainan
Province): the Vision and Actions on Jointly Building the Silk Road Economic Belt
and 21st-Century Maritime Silk Road.7 Furthermore, in the same year, the PRC
succeeded in completing the creation of the project’s principal financial
mechanism, the Asian Infrastructure Investment Bank (AIIB), which col-
lected the commitment of 57 founding members, among which, the pres-
ence of several Unites States’ Western and Asian allies stuck out.
As will be discussed in the present article, the OBOR initiative can be
considered as the current stage of a political-economic development strat-
egy that the Chinese government introduced at the end of the 1990s for
the sake of China’s own domestic economic development: the so-called «Go
Global» strategy. The essence of the strategy has been to support, through
a liberalization of regulations, outbound foreign-direct investment (OFDI)
from Chinese companies, especially state-owned enterprises (SOEs) with
the purpose of improving their international competitiveness and protect-
ing the Chinese labour market from harsh industrial conflicts. The result
has been an incremental internationalization of Chinese SOEs and of big,
private corporations heavily financed and entrenched within the Chinese
state.8 Throughout the launch of the OBOR project and the establishment
of the AIIB, these enterprises were once more incentivized to invest in the
global economy, even if they were encountering strenuous resistance and
widespread critiques abroad. Chinese corporations were indeed accused of
being «unfair» competitors, because they were being supported by a system-
atic and structured state intervention, both in China and abroad.9
From the above standpoint, the year 2015 opened for China with Presi-
dent Obama’s blunt and well-defined challenge, represented by the view
enunciated in his 20 January 2015 State of the Union Address. «Twenty-first
century businesses, including small businesses, need to sell more American
products overseas», said the US President. He went on to state: «Today, our
businesses export more than ever, and exporters tend to pay their workers
higher wages. But as we speak, China wants to write the rules for the world’s
fastest-growing region. That would put our workers and our businesses at a
disadvantage. Why would we let that happen? We should write those rules.
7. National Development and Reform Commission (Ministry of Foreign Affairs

and Ministry of Commerce of the People’s Republic of China), Vision and Actions on
Jointly Building Silk Road Economic Belt and 21st Century Maritime Silk Road, 28 March
2015 (http://en.ndrc.gov.cn/newsrelease/201503/t20150330_669367.html).
8. ‘Waishang touzi chanye zhidao mulu’ (Catalogue of Industries for Foreign
Investments), Ministry of Commerce of the People’s Republic of China, 30 December 2011.
9. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, Asia Maior
2014, pp. 18-30; Tobias ten Brink, ‘The Challenges of China’s Non-Liberal Capital-
ism for the Liberal Global Economic Order’, Harvard Asia Quarterly, vol. 16, n. 2,
2014, pp. 36-44.
22
China 2015
We should level the playing field. That’s why I’m asking both [US] parties to
give me trade promotion authority to protect American workers, with strong
new trade deals from Asia to Europe that aren’t just free, but are also fair.
It’s the right thing to do».10 In this passage, Obama was trying to persuade
Congress to grant him full Trade Promotion Authority in order to speed up
the establishment of the Trans-Pacific Partnership Agreement (TPP). This
agreement could be interpreted, as has been previously mentioned,11 as a
strategy to formerly exclude China in order to be able to engage and disci-
pline it latterly. Congress granted the Trade Promotion Authority in June
2015; TPP negotiations then closed on 5 October 2015, and a final text
was released at the end of the year, contributing to renew an ideological
divergence on the capacity and method of regulating the global economy.
The TPP was indeed designed to isolate the state-centred economic-devel-
opment model espoused by the PRC.12 However, the establishment of the
AIIB, its early approval by many governments (including western
ones), and the US opposition and lobbying stance against it, drew a
fair amount of doubt about the efficacy of TPP plan.
The OBOR and the AIIB, though, did not just represent an evolu-
tion and a strengthening of the Chinese «Go Global» strategy; indeed, they
were also becoming a powerful foreign-policy tool through which the PRC
proposed itself as the promoter of, as Xi affirmed during the Boao Forum,
a «more democratic form of global governance» and a so-called «commu-
nity of common destiny», where the principle of «wide consultation» and
«joint contribution» reigned and where the other countries’ choices in terms
of their social systems and development paths were said to be respected.13
The PRC declared no intention to export its state-centred development ap-
proach to capitalism throughout the OBOR and the AIIB, as the West did
with neoliberalism through the Bretton Woods institutions, especially from
the 1990s. Furthermore, PRC refused the accusations of having launched
a new Marshall Plan with the OBOR in order to strategically control the
countries along the routes.14
10. The White House, Office of the Press Secretary, Remarks of the President in
State of the Union Address, 20 January 2015 (https://www.whitehouse.gov/the-press-of-
fice/2015/01/20/remarks-president-state-union-address-january-20-2015).
11. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, pp. 17-30.
12. Ibid.; Ian F. Ferguson, Mark A. McMinimy & Brock R. Williams, ‘The Trans-
Pacific Partnership (TPP): In Brief ’, Congressional Research Service, 9 February 2016.
13. ‘Full text of Chinese President’s speech at Boao Forum for Asian Annual
Conference 2015. Towards a Community of Common Destiny and a New Future for
Asia’, Xinhuanet, 29 March 2015.
14. Ministry of Foreign Affairs of the People’s Republic of China, Promote Friend-
ship Between Our People and Work Together to Build a Bright Future. Speech of Xi Jinping,
President of the People’s Republic of China at Nazarbayev University, 8 September
2013 (http://www.fmprc.gov.cn/mfa_eng); ‘Silk Road, Marshall Plan comparison un-
23
Francesca congiu
In that sense, China in 2015 was recalling the NIEO experience in

a way that could be said to validate Nils Gilman’s paradoxical thesis that,
although NIEO failed to realize the developing nations’ institutional de-
mands, «one can make a credible case that the undead spirit of the NIEO
continues to haunt international relations».15
In theory, the OBOR and the AIIB might pose a significant challenge
to the hegemony of the US-led multilateral institutions. However, one could
doubt that they might also incentivize a radical change in the domestic-
development path of each involved country, determining its departure
from the neoliberal development model. At the end of the day, the OBOR
and AIIB goals are the promotion of transport infrastructure building, as
well as of energy, telecommunications, and rural infrastructures, without
posing any kind of political-economy conditions. These goals are likely to
be reached reproducing the same socio-economic polarization conditions,
common to both the followers of the neoliberal paradigm and to those of
the Chinese development path.
Building the conditions for lucrative development in developing coun-
tries, as well as in China, has often entailed the dispossession of millions of
people whose land has been expropriated by the state and, in most cases, sold
to multinationals in order to build transport infrastructures, dams, export
processing zones, real estate areas, and plantations. This kind of develop-
ment path has given rise to a huge reserve army of migrant workers contrib-
uting to the race to the bottom of the cost of global labour.16 It is indeed very
likely that the proposed widespread infrastructure building in all the involved
countries would be capable of attracting more foreign-direct investments than
most countries might welcome, contributing to reproduce that kind of path.
A study from the Asian Labour Review further argues that the AIIB regula-
tions do not satisfactorily address labour and environmental issues and do
not request the adherence to the related international conventions and regu-
lations.17
wise’, Global Times, 23 November 2014; ‘Correcting misconceptions about the Silk
Road Initiatives’, China Daily, 10 March 2015.
15. Nils Gilman, ‘The New International Economic Order: A Reintroduction’,
p. 10.
16. David Harvey, ‘The «New» Imperialism: Accumulation by Dispossession’, So-
cialist Register, vol. 40, 2004, pp. 63-87; John Bellamy Foster & Robert E. McChesney
& R. Jamil Jonna, ‘The Global Reserve Army of Labor and the New Imperialism’,
Monthly Review, vol. 63, n. 6, November 2011 (http://monthlyreview.org/2011/11/01/
the-global-reserve-army-of-labor-and-the-new-imperialism); Dae-oup Chang, ‘From
Global Factory to a Continent of Labour: Labour and Development in Asia’, Asian
Labour Review, vol. 1, 2015 (http://asianlabourreview.org/2016/02/18/from-global-
factory-to-continent-of-labour-labour-and-development-in-asia).
17. Sanjiv Pandita, ‘The Asian Infrastructure Investment Bank: Labour and En-
vironmental Concerns’, Asian Labour Review, vol. 1, 2015 (http://asianlabourreview.
org/2016/02/19/the-asian-infrastructure-investment-bank-labour-and-environmen-
tal-concerns).
24
China 2015
Lastly, the OBOR initiative has also been accused to have military im-
plications with specific reference to the maritime disputes in the South China
Sea. In 2015, military tensions in the Asian region among China, the United
States, and those Asian countries involved in the disputes were indeed quite
intense. The PRC speeded up its island-building in the South China Sea in
order to assure itself major portions of the disputed maritime area and start-
ed to build ports, airstrips, radar facilities, and other military installations
along the construction works related to the OBOR initiative in Southeast Asia.
The United States, on its part, continued to militarize the area and sent navy
destroyers to patrol the man-made «islands» (including those claimed by the
Philippines and Vietnam) to prove they were not proper islands, hence, not
entitled to a 12-nautical-mile territorial sea, nor Exclusive Economic Zones.18
At this point it is worth highlighting that the Chinese Communist Party
was, in the domestic context, in a serious deficit of consent. The party was
dealing with hundreds of demonstrations a day concerning labour issues in
the urban areas, land grabbing in the countryside, and environmental issues
throughout the country. This being the situation, socio-economic disparities
and the recent economic slowdown were forcing the party to search for new
sources of political legitimacy. Accordingly, the OBOR, with its potential
to improve national economic development and above all to fuel nation-
alistic sentiments, was a handy instrument aimed at strengthening a weak
political legitimacy. The other main instrument, as it has been underlined
somewhere else,19 was the anti-corruption campaign, as shown by the po-
litical implications of the Tianjin blasts in a chemical warehouse in August
2015. Local and central officials, together with the company executives (the
Tianjin Ruihai International Logistics Co. Ltd), were indeed found guilty
for the blast that killed 173 people and contaminated nearby water sources.
Moreover, they were investigated and convicted of corruption. The main
issue at stake was that the warehouse was found to be too close to residential
complexes, in violation of the Chinese work-safety rules.20 On August 19,
Xinhua (the state-run news agency) published an investigative report that
mentioned the names of the company executives detained by the police.21
The report specified that these executives had strong and good connec-
18. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, pp. 22-24; ‘US
Navy Commander Implies China Has Eroded safety of South China Sea’, The New
York Times, 15 December 2015.
19. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, Asia Maior
2014, pp. 36-7.
20. ‘Tianjin explosion: China sets final death toll at 173, ending search for sur-
vivors’, The Guardian, 12 September 2015; ‘China Holds 23 Linked to Fatal Blasts in
Tianjin’, The New York Times, 26 August 2015; ‘Tianjin warehouse blasts: Evidence of
corruption, says Chinese premier as he vows nobody will be exempt from punish-
ment’, The South China Morning Post, 24 September 2015.
21. ‘China Focus: Doubts cast over legitimacy of Tianjin blast warehouse’, Xin-
hua, 19 August 2015.
25
Francesca congiu
tions with government officials. This is certainly indicative that the CCP was
trying to rebuild its legitimacy by making an example of some of its own
members and state officials. These people were made a scapegoat for the
historically consolidated wrongdoings that made up the Chinese economic
miracle and for the presently evident environmental, social, and health dis-
asters throughout China.22
3. The Silk Road Economic Belt and the 21st-Century Maritime Silk Road:
the Project in its Official Document
Xi Jinping exposed the Silk Road Economic Belt at Nazarbayev Uni-

versity on 7 September 2013 as part of his state visit to Kazakhstan. The
New Maritime Silk Road was announced before the Indonesian Parliament
on 3 October 2013 during Xi Jinping’s state visit to Indonesia. Furthermore,
the two correlated initiatives were officially presented as one single project
in November 2013 during the Third Plenum of the Central Committee of
the Chinese Communist Party (CCP).23 As there stated: «To adapt to the
new trend of economic globalization, we must promote domestic openness
together with openness to the outside world, better integrate the ‘Bring
In’ and ‘Go Global’ strategies […]. We will set up development-oriented fi-
nancial institutions, accelerate the construction of infrastructure connecting
China with neighbouring countries and regions, and work hard to build a
Silk Road Economic Belt and Maritime Silk Road, so as to form a new pat-
tern of all-round opening».24
In general terms, the project foresees the construction of highly in-
tegrated and mutually beneficial maritime and land-based economic cor-
ridors linking Europe, Africa, and Asia, as Xi Jinping’s speeches in Ka-
zakhstan and Indonesia have made clear.25 In March 2015, the Chinese
government went further ahead and transformed it into an institutional
foreign-policy measure through the enactment of an official document dur-
22. ‘Shareholders of Tianjin blast warehouse and their deep connections re-
vealed’, Xinhua, 19 August 2015.
23. Central Committee of the Communist Party of China, Decision of the central
committee of the communist party on some major issues concerning comprehensively deepening
the reform, adopted at the III Plenary Session, 12 November 2013 (http:// http://www.
china.org.cn/china/third_plenary_session/2014-01/16/content_31212602.htm).
24. Ibid.
25. ‘Promote Friendship Between Our People and Work Together to Build a
Bright Future. Speech of Xi Jinping, President of the People’s Republic of China at
Nazarbayev University’; ‘Speech by Chinese President Xi Jinping to Indonesia Par-
liament’, Asean-China Center – Regulations, 3 October 2013 (http://www.asean-china-
center.org/english/2013-10/03/c_133062675.htm).
26
China 2015
ing the Boao Forum for Asia: the previously mentioned Vision and Actions on
Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road.26
In the first of this eight-chapter document («Background»), the Chi-
nese government – in the face of an on-going international financial crisis,
the uneven global development, and the major adjustments occurring in
the field of multilateral trade and investment – declared its intention to pro-
mote an initiative aimed at catching the current «trend towards a multipolar
world, economic globalization» and «to seek new models of international
cooperation and global governance». More specifically, the document stated
that the OBOR aimed to «promote the connectivity of Asian, European and
African continents and their adjacent seas, establish and strengthen part-
nerships among the countries along the Belt and Road […]».27
In its second chapter («Principles»), the document set out the philoso-
phy at the basis of the OBOR project. Apart from the commitment to abide
by the Five Principles of Peaceful Coexistence, the project was founded
upon the principle of inclusiveness, market rules, and mutual benefits. The
initiative was, indeed, said to be open to all countries, no matter which
paths and modes of development they had chosen to follow. However, this
principle was immediately followed by one of compliance with market prin-
ciples without specifying the risk of clash between the two and the possible
ways to face this ambiguity.
In the third chapter («Framework»), the Chinese government outlined
the structure of the project, specifying networks, bridges, and economic cor-
ridors that eventually needed to be reinforced or built from scratch on land
and at sea.
The fourth chapter («Cooperation Priorities») represented the core of
the document, as it established, in line with Xi Jinping’s 2013 speeches,
the five major cooperation goals of the project: (1) policy coordination, (2)
facilities connectivity, (3) unimpeded trade, (4) financial integration, and (5)
people-to-people bonds. Apart from conventional goals, such as inter-gov-
ernmental cooperation, free trade and investment cooperation, and cultur-
al exchanges, among its major and innovative goals, the initiative envisaged
the construction of a huge infrastructure network able to connect Asian, Eu-
ropean, and African markets and the safeguarding of oil and gas pipelines
along the routes. In this way, the document underlined the importance of
financial integration as a fundamental instrument for the implementation
of the OBOR initiative. It proposed to jointly work to establish an Asian
Infrastructure Investment Bank (AIIB), a BRICS New Development Bank
(NDB), a SCO financial institution, and finally, a Silk Road Fund.
In its fifth chapter («Cooperation Mechanisms»), the OBOR docu-
ment, to better realize the envisaged goals, pledged to take advantage of
26. ‘Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-
Century Maritime Silk Road’.
27. Ibid.
27
Francesca congiu
existing multilateral-cooperation mechanisms, such as the Shanghai coop-

eration Organization (ScO), ASEAN plus China (Association of Southeast
Asian Nations), Asia-Pacific Economic Forum (APEC), and Asia-Europe
Meeting (ASEM), to mention but a few. In its sixth chapter («China’s Re-
gions in Pursuing Opening-Up»), the document focussed on the possible
outcomes of the project for China’s own economy. According to the text,
Chinese rulers believed that the project would have enhanced the openness
of China’s economy by speeding up the development of the western and
less-wealthy regions and bringing the structural reforms in the coastal and
most-advanced areas in line with the 12th Five Year Plan promulgated in
2011 and the 13th Five Year Plan proposed in 2015.
Finally, in the last two chapters («China in Action» and «Embracing a
Brighter Future Together»), the text briefly outlined some of China’s in-
itial actions, such as high-level official visits, the signing of cooperation
agreements, the promotion of financial integration, and the importance of
«equal-footed consultation with all countries along the routes».28
Following the ancient-land and maritime routes, the idea behind the
Silk Belt Economic project was to draw a commercial line between Xi’an
in Central China and Venice via Rotterdam in Central Europe, passing
through Central Asia, Iran, Iraq, Syria, Turkey, and Eastern Europe. As far
as the Maritime Silk Road was concerned, it was supposed to start in Quan-
zhou in Fujian Province and end on the Southern European coast, passing
through the Southern Chinese ports, the Malacca Straits, the Indian Ocean,
the Eastern African coasts, and the Mediterranean sea.29
The One Belt, One Road project was aimed at involving a range of
more than 60 emerging-market and developing countries with a total pop-
ulation of over 4 billion and with 75% of the known energy reserves that
accounted for about 65% and 30%, respectively, of the global totals in land-
based and maritime-based economic production values.30
According to the financial and business news and information online
in the periodical Caixin, in the first four months of 2015, bilateral trade
between China and the countries along the above-land and maritime routes
equalled US$ 316 billion (30% of China’s total international trade during
the same period). Furthermore, direct investments by Chinese companies in
the area’s non-financial sector amounted to US$ 3.7 billion (10% of China’s
total overseas investment during the same period).31
28. Ibid.
29. Camille Brugier, ‘China’s way: the new Silk Road’, European Union Institute
for Security Studies, May 2014.
30. ‘China Must Prove Silk Road Plan is Serious’, Financial Times, 4 May 2015;
François Godement, ‘«One Belt, One Road»: China’s Great Leap Outward. Introduc-
tion’, China Analysis, June 2015; Wang Yiwei, ‘China’s «New Silk Road»: A Case Study
in EU-China Relations’, in Alessia Amighini & Axel Berkofsky (eds.), Xi’s Policy Gam-
ble: The Bumpy Road Ahead, Novi Ligure: Edizioni Epoké, 2015, pp. 97-8.
31. ‘Investors Embrace China’s Big Belt, Risky Road’, Caixin, 17 June 2015.
28
China 2015
Also, according to Xinhua, during the first seven months of 2015,

Chinese companies had already signed 1,786 project contracts in countries
along the two routes valuing US$ 49.44 billion, an increment of 39.6% from
the year before.32
It goes without saying that the effective realization of the project im-
plied China’s deep involvement in the creation of infrastructural networks,
such as railways, ports, highways, and pipelines. Furthermore, at the same
time, in the Chinese vision, currency integration and expansion of the in-
ternational use of Chinese currency in the region was an additional funda-
mental element.33 Ba Shusong, chief economist at the China Banking Asso-
ciation, argued that «the initiatives will promote the use of the yuan beyond
China by expanding the country’s international investment and trade activ-
ity, which in turn will circulate more yuan, more widely».34 To this end, ac-
cording to Caixin, between 2014 and 2015, China made major investments
in the area, as «Chinese companies and banks are eager to invest in vast
areas of Asia, Europe and Africa targeted for development through China’s
“one belt, one road” initiatives».35 All Chinese projects connected with the
OBOR initiative involved the participation of state-owned Chinese com-
panies or private Chinese companies with close relations with the central
government, all committed to financial, construction, or supply activities.36
4. The «Go Global» strategy, the «New Normal» theory,

and the OBOR initiative
At the end of 2015, China’s GDP growth stabilized itself at around

6.9%, according to China’s official statistics, attesting to an economic slow-
down for which origins can be traced back to the beginning of the on-going
global economic crisis.37 Since the end of the first decade of the 21st century,
China’s economy has indeed been growing far slower than the double-dig-
it rates to which the world had become accustomed during the past dec-
ades.38 This condition, new to the Chinese, appears to have become China’s
32. ‘Chinese Companies Ink More Contracts Along Belt and Road’, Xinhuanet,
21 July 2015.
33. ‘«Xin silu, xin mengxiang». Tegao: shijie ruhe gongying? Zhongguo zheng-
zai poti’, Xinhua, 8 May 2014.
34. ‘Investors Embrace China’s Big Belt, Risky Road’.
35. Ibid.
36. Frans Paul van der Putten & Minke Meijnders, China, Europe and the Maritime
Silk Road, Clingeldael Report, Netherland Institute of International Relations, March
2015, p. 8.
37. ‘China’s Economic Growth in 2015 is Slowest in 25 Years’, The Wall Street
Journal, 19 January 2016.
38. ‘Chinese Economy Slows to 6.9% in Third Quarter Despite Stimulus’, The
Guardian, 19 October 2015.
29
Francesca congiu
«New Normal». The term, which has been used to describe the state of the
economy after the onset of the global-economic crisis, was later adopted by
Xi Jinping and adapted to the Chinese situation in order to portray Chi-
na’s current economic slowdown as a typical normalizing process of a once
fast-growing economy. Xi Jinping’s «New Normal» theory was fully present-
ed on 9 November 2014 on the occasion of the Chinese President’s speech
at the APEC CEO (Asia-Pacific Economic Cooperation – Chief Executive
Officers) Summit in Beijing in front of 1,500 business people from 21 APEC
member economies and 17 other countries and regions.39
As stated by Xi, the Chinese «New Normal» indicated an on-going tran-
sitory condition from a labour-intensive and export-driven economy to a
capital-intensive, high-tech, and domestic demand-driven one, based more
on the tertiary than the secondary sector, as in the previous developing
phase. China was entering into a new stage of development, passing from
a high-speed to a medium-high-speed growth where innovation was taking
the place of investment as a major driver. In order to follow this path, Xi
admitted the Chinese government was undertaking major economic struc-
tural adjustments. «[…] we have lifted restrictions on the “invisible hand” of
the market», stated Xi, «and ensured the proper role of the “visible hand” of
the government».40 The Chinese leader saw China’s economic slowdown as
an opportunity, physiological for most economies, to make China’s develop-
ment more sustainable in terms of services, innovation, reduced inequality,
and environmental protection.41
The same concepts are included in the 13th Five Year Plan’s Propos-
al (2016-2020), released by the CCP fifth plenum in October 2015. The
proposal indeed referred to five main principles in relation to Chinese fu-
ture-development policies, which evoke the «New Normal» theory’s con-
tents: innovation, openness, green development, coordination, and in-
clusiveness. Innovation was presented as the primary driver of Chinese
economic development and industrial pattern’s upgrading. Openness was
mainly intended to focus both on domestic and global market but, above
all, on being more active in global governance. Furthermore, the proposal
was a way to reiterate China’s commitment to environment protection and
to socio-economic disparities’ reduction.42
39. ‘Xi’s New Normal Theory’, Xinhuanet, 9 November 2014.

40. ‘Seek Sustained Development and Fulfill the Asia-Pacific Dream. Address by
Xi Jinping’, Apec China 2014, 13 November 2014, (http:// http://www.apec-china.org.
cn/41/2014/11/13/3@2580.htm).
41. Ibid.
42. ‘Zhonggong zhongyang guangyu zhiding guomin jingji he shehui fazhan di
shisan ge wu nian guihua de jianyi, 2015.10.29’ (Proposal on Formulating the 13th Five-
Year Plan on National Economic and Social Development, 29.10.2015), Xinhuanet, 3
November 2015 (http://news.xinhuanet.com/fortune/2015-11/03/c_1117027676.htm).
30
China 2015
In line with the party’s approach, Hu Angang, professor of economics

at Tsinghua University, argued that China’s transition was already yielding
the first results in terms of a «better quality growth». China’s new trend in
the political economy was creating millions of urban jobs; it was expanding
the service sector and was upgrading the industrial production through sig-
nificant public investments for research and development while, at the same
time, mechanizing agriculture. Furthermore, social welfare was improving
with an important expansion of the healthcare system, which now covered a
little less than 95% of China’s total population. 43
With respect to this formidable, planned re-orientation of the domestic
economic model, the Silk Economic Belt and the 21st-Century Maritime
Silk Road can be understood as key strategies for confronting and overcom-
ing the economic slowdown. For the Chinese economy, the OBOR project
would indeed entail the opening of potentially huge markets for Chinese
goods and capital.
Once the above has been said, it is necessary to stress that, notwith-
standing Beijing’s on-going efforts towards a transformation of its economic
model, the domestic heavy and light industrial sectors are said to be charac-
terized by a serious, progressive-industrial overcapacity. Such a situation was
primarily due to the global-economic recession, followed by diversified state
financial-stimulus initiatives. This appeared to be particularly true for the
Chinese state-owned enterprises active in the manufacturing and construc-
tions’ sectors. On top of it, these industries were in the middle of serious
industrial conflicts and heated debates over their structural reform and,
above all, over the path and strategies to be followed to reach the desired
transformation of the extant economic model.44 Although the SOEs’ mar-
ket-oriented reform had been officially launched by the CCP third plenum
in 2013, the new strategy clashed with major vested interests, which made it
difficult to implement it in absence of a (hard-to-reach) agreement among
the major, internal, political and economic forces. As stated by Premier Li
Keqiang at the annual Central Economic Work Conference in December
2015, the Chinese «supply side» needed serious structural reforms, based
on tax reductions, advanced technologies, innovation, and services. Unre-
formed SOEs were supposed to be the major challenge to this structural
change, because they were said to be suffering from excessive capacity and
low efficiency, which were becoming an increasingly serious problem given
the on-going economic decline.45
43. Hu Angang, ‘Embracing China’s «New Normal»’, Foreign Affairs, May-June

2015.
44. ‘China’s overcapacity crisis can spur growth through overseas expansion’,
South China Morning Post, 7 January 2014; ‘Strikes and protests by China’s workers
soar to record heights in 2015’, China Labour Bulletin, 07 January 2016.
45. ‘SOEs Suffer Most from Industrial Overcapacity’, China Daily, 08 December
2015. For details on SOEs reforms see: Barry Naughton, ‘Reform Agenda in Turmoil:
31
Francesca congiu
The infrastructure projects proposed as part of the OBOR initiative

would strategically fuel China’s domestic-construction industry, including
iron, steel, and cement, and, at the same time, would create a more rapid
and viable way for Chinese goods towards regional markets in Europe, Cen-
tral Asia, Africa, and Southeast Asia, giving more chances to the strongest
but also to the more problematic SOEs.46 Furthermore, the OBOR project
could also be considered as a means to secure access to raw materials, en-
ergy in particular. In this case, Central Asia – from which China has been in-
creasing its energy imports in order to lessen its dependency on the Middle
East, Sub-Saharan Africa, and Russia – was the key factor, as demonstrated
by the Chinese focus on the Eurasian infrastructure corridor (§ 4.1).47 Soon
after the 1989 Tiananmen repression and the 1991 USSR collapse, China
indeed started to devote all its efforts to reassure its neighbours on the west
and southeast that its development was peaceful and its growth had a posi-
tive international fallout. China needed good neighbourhood relations to
be able to concentrate on its domestic development and nurture its vora-
cious natural resources’ sector with profitable economic agreements.
As specified in the 6th chapter of Vision and Actions on Jointly Building Silk
Road Economic Belt and 21st-Century Maritime Silk Road, («China’s Regions in
Pursuing Opening-Up»), the OBOR initiative was also finalized to develop a
domestic consumer market by improving domestic connectivity between the
developed coasts and the underdeveloped inner areas and also among the
countries along the borders, reducing, in this way, the socio-economic gap
between coastal and rural areas.48 Moreover, this would have helped Beijing
to control social discontent in critical areas, such as the Xinjiang Uyghur au-
tonomous region, where separatist stances were being held responsible for
the recent so-defined «terrorist attacks».49 In fact, Xinjiang was one of the
regions towards which Beijing had started to move its manufacturing sector
through major investments, in an effort that was part of the above-mentioned
domestic dual-development goal. For these reasons, the central government
has established 20 special industrial zones in Xinjiang. Since 78% of Xinji-
ang’s exports were already directed to central Asian neighbours, the OBOR
task would be to further promote and facilitate the export of goods produced
in this region in order to strengthen its economic development.50
Can Policy-makers Regain the Initiative?’, China Leadership Monitor, n. 48, Fall 2015.
46. Nadège Rolland, ‘China’s New Silk Road’, The National Bureau of Asian Re-
search – Commentary, Washington, 12 February 2015.
47. Camille Brugier, ‘China’s way: the new Silk Road’, (§ 4.1).
48. ‘Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-
Century Maritime Silk Road’.
49. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, p. 36; ‘Main-
land Officials Confirm Xinjiang Terrorist Attack that Reportedly Killed up to 50
People’, The South China Morning Post, 15 November 2015.
50. ‘Vision and Actions on Jointly Building Silk Road Economic Belt and
32
china 2015
Looked at under this light, the OBOR project could be seen as an alter-
native to a simple market-oriented transition that was encountering such a
strenuous resistance inside the Chinese economic and political system. The
project, though, would contribute to reinforce rather than change China’s
current and peculiar political-economic path, as efficaciously described by
Tobias ten Brink, a scholar from Frankfurt University: «a heterogeneous,
competition-driven variant of state-permeated capitalism» which «takes the
form of extensive state intervention with a specific competition-driven, cor-
porate spirit».51
Since its launch, which preceded the OBOR opening in 2013 of over
two decades, China’s «Go Global» strategy aimed primarily at upgrading
both private and state-owned Chinese enterprises’ industrial and develop-
ment structure in order to make them sufficiently competitive to be inter-
nationalized. This strategy was later included in Xi Jinping’s current «New
Normal» theory.
The first stage of the «Go Global» strategy served the state-owned enter-
prises need of acquiring natural-resource assets, mainly in the energy sector,
to feed a low-tech manufacturing-exporter sector. The second stage, launched
by Xi Jinping, aimed at industrial upgrading by investing in high-tech in-
frastructure projects abroad. China needed to diversify the use of its huge
foreign reserves, both to foster the industrial upgrading of its own domestic
industry and to deal with its overcapacity. Finally, she also needed to deal with
capital-labour conflicts and the demand for better working conditions and
higher salaries. During the year under analysis, workers’ strikes and protests
strongly intensified, according to the China Labour Bulletin’s data. Workers
were indeed struggling against the failure of local governments to enforce the
2008 Labour Contract Law, which provided more protection for basic labour
rights, such as on-time payment, benefits, and due-wage arrears.52
The essence of this strategy was to support, through a liberalizing
regulation, outbound foreign direct investment (OFDI) from Chinese com-
panies (especially SOEs) by improving their international competitiveness.
The procedure for examination and approval of outward investment pro-
jects have been progressively simplified, decentralized, and accelerated.
Moreover, the Chinese government – both directly and through banking
institutions, including the China Development Bank and the China Export
and Import Bank – has been offering financial and non-financial incen-
tives to sustain the overseas expansion of Chinese enterprises. Among these
incentives are government special funds, direct capital contribution, and
21st-Century Maritime Silk Road’; ‘The Complex Impact of Urbanization in Xinji-

ang’, The Diplomat, 16 December 2015.
51. Tobias ten Brink, ‘The Challenges of China’s Non-Liberal Capitalism for
the Liberal Global Economic Order’.
52. ‘Strikes and protests by China’s workers soar to record heights in 2015’,
China Labour Bulletin, 7 January 2016.
33
Francesca congiu
loans below market rates and subsidies. In 2009, the China Development
Bank, for example, supported the Chinese telecommunication company
Huawei with US$ 30 billion to expand in overseas markets. As far as the
non-financial incentives were concerned, the government typically offered a
wide range of information about the recipient countries.53 In order to have
the right perception of how much the Chinese leadership relied on such
national-global corporations, suffice to say that, in the occasion of overseas
official visits, Chinese officials usually envisaged a visit to the local Huawei
subsidiary.54
As a result of this policy, there has been a spectacular increase in Chi-
nese OFDI. According to United Nations Conference on Trade and Devel-
opment (UNCTAD) data, Chinese OFDI amounted to US$ 830 million in
1990, US$ 6,885 billion in 2001, and US$ 116,000 billion in 2014.55 Again,
as a result of this policy, several international brands, such as Motorola,
Volvo, and IBM, have come under the control of Chinese companies. The
major players in this dramatic increase in Chinese FDI outflows have been
the SOEs, which have funded at least 80% of the OFDI.56
In 2015, the OBOR initiative could be considered the extension and
the institutionalization of a plan mainly focussed on the internationalization
of Chinese companies and further reinforced by means of the newly born
multilateral financial institutions.
5. The OBOR initiative «in action»: Beijing’s infrastructure diplomacy
At the end of the day, the «One Belt, One Road» initiative was nothing
more than a huge rhetorical and diplomatic operation that gave a banner
of historical legitimacy to China’s «Go Global» strategy. The reasons behind
the OBOR initiative were several, among which, as above noted, domestic
economic development and security issues enjoyed an uncontested priority.
Through the OBOR initiative, Xi Jinping and Li Keqiang gave a new
imprinting to this on-going strategy, highlighting the role of transporta-
tion-infrastructure projects in shaping Beijing’s «new diplomacy». In Li
Keqiang’s own words: «We will speed up the implementation of the “Go
Global” strategy. We will encourage Chinese companies to participate in
53. Du Ming, ‘When China’s National Champions Go Global: nothing to fear

but fear itself?’, Journal of World Trade, vol. 48, n. 6, 2014, pp. 1133-134.
the Liberal Global Economic Order’, p. 41.
55. UNCTAD, ‘FDI Outflows by region and economy, 1990-2014’, World In-
vestment Report 2015: annex tables, (http://unctad.org/en/Pages/DIAE/World%20Invest-
ment%20Report/Annex-Tables.aspx).
56. ‘The Visible Hand’, The Economist, 21 January 2012; Du Ming, ‘When Chi-
na’s National Champions Go Global: nothing to fear but fear itself?, p. 1128.
34
China 2015
overseas infrastructure development projects […] We will work to increase

the international market share of Chinese railway, electric power, communi-
cations, engineering machinery, automobiles, aircraft, electronics […] and
encourage the metallurgical, building materials, and other industries to in-
vest overseas».57
The majority of the more-recent infrastructure projects promoted by
the PRC along the land and New Maritime Silk Roads have been the by-
product of bilateral agreements. Nevertheless, the Chinese government
promoted the initiative at regional forums also, including the Asia–Europe
Meeting, the Shanghai Cooperation Organization, ASEAN plus China, the
China–Arab States Cooperation Forum, the Forum on China-African Co-
operation, and the sixteen central and eastern European Countries, plus
China.58 In November 2014, at a China-ASEAN summit held in Myanmar,
Chinese Premier Li Keqiang announced that China would offer US$20 bil-
lion of loans to the ASEAN for infrastructure building.59 In January 2015,
the African Union and China signed a memorandum of understanding to
collaborate on building high-speed railways, roads, and new airports in or-
der to improve connections among the major African-economic poles.60
Furthermore, in December 2014, the Development Research Centre of
the State Council of China created a multilevel, multilateral platform – the
Silk Road Forum – in order to provide an intellectual venue that brought
together statesmen, senior figures in governments, think tanks, enterprises,
academic institutions, and independent scholars from all countries along
the routes. The declared scope was to provide an inclusive platform in order
to exchange ideas, combine strategies, policies, and interests while also pro-
moting convergences. The first annual conference of the Silk Road Forum
was held in Istanbul in December 2014, and the second one was held in
Madrid in October 2015 with the participation of around 300 guests from
approximately 30 nations and international institutions.61 On this last oc-
casion, the so-called SiLKS (Silk Road Think Tank Network) was also estab-
lished in an effort to foster cooperation and discussion among think tanks
along the routes, in the fields of research, and the elaboration of policy
ideas concerning the overall OBOR project (objectives, outcomes, potenti-
alities, and criticalities). SiLKS, at the moment of its establishment, already
had 43 members and partners, including think tanks and international or-
57. Li Keqiang, ‘Full Text: Report on the Work of the Government’, Xinhuanet,
16 March 2015, in particular see Section III.
58. Frans Paul van der Putten & Minke Meijnders, China, Europe and the Mari-
time Silk Road, p. 30.
59. ‘China Pledges over 20-bln-USD Loans to Boost Southeast Asian Connectiv-
ity’, Xinhuanet, 13 November 2014.
60. ‘AU, China to cooperate on Infrastructure, Industrialization’, Xinhuanet, 27
January 2015.
61. ‘Silk Road Forum Held in Madrid’, Xinhuanet, 29 October 2015.
35
Francesca congiu
ganizations from 27 countries.62 A look at the list of the Silk Road Forum’s
experts on the Development Research Centre’s website confirms that SiLKS
has effectively brought together a combination of high-level experts from
all over Eurasia and Africa.63
5.1. Building the Eurasian corridor

The Silk Road Economic Belt project combined and strengthened a se-
ries of «going out – going west» policies, aimed in particular at Central Asia,
whose beginnings could be traced back to the late 1990s, when the Shang-
hai Five Mechanism took form.64 Nevertheless, as far as infrastructural in-
vestments were concerned, the initiative also implied a series of specific pro-
jects that had been announced or implemented in a more-structured way
between 2014 and 2015. The main goal was to create a Eurasian economic
corridor – through «transportation infrastructure diplomacy», trade liber-
alization, and monetary cooperation – able to further develop Central Asian
economies and integrate them into both European and Asian markets.
To this end, as well as for strictly internal security and political reasons,
Xinjiang Province jumped to the forefront of China’s toward-west policies,
becoming the target of an incessant promotion of urbanization and influx of
investment, as will be further argued in the next paragraphs. In particular,
many of Xinjiang’s cities, at the border with Central Asia, have been trans-
formed into free-trade economic zones. The most significant example is that
of the city of Horgos (also known with the names of Huoerguosi, Khorgos,
Chorgos, and Gorgos), near the border with Kazakhstan, which, in Septem-
ber 2004, had already become the headquarters of the Horgos International
Border Cooperation Centre, founded following an agreement between Chi-
na and Kazakhstan. This development was certainly due to Horgos’ glorious
past, during which it played a junction role along the ancient Silk Road.
However, soon after the 1917 Russian revolution, the borders (at the time
dividing Russia and China) were closed, only to be permanently reopened
in 1983. In 2012, China developed a free-trade zone in the area, and in
2013, bilateral trade through Horgos accounted for US$ 11 billion, 55.5%
more than in 2012. On 29 June 2014, Horgos formally became a Chinese
municipality and, together with Kashgar and Alataw, has been granted the
role of the largest land port along the Silk Economic Belt.65
62. ‘Declaration of SiLKS’, China Daily, 30 October 2015. See also Patrick C. P.
Ho (Deputy Chairman and Secretary General China Energy Fund Committee), ‘Some
Thoughts About the Think Tanks Alliance’, Silk Road Forum 2015, (http://en.drc.gov.
cn/PatrickHo.pdf).
63. Development Research Center of the State Council of the People’s Republic of
China, Silk Road Forum – Forum Experts, (http://en.drc.gov.cn/silkroadforumexperts.html).
64. Justyna Szczudlik-Tatar, ‘China’s New Silk Road Diplomacy’, Policy Paper The
Polish Institute of International Affairs, vol. 82, n. 34, December 2013.
65. ‘Horgos – the Silk Road Economic Belt’s youngest city’, Xinhuanet, 16 July
36
China 2015
In order to make Horgos and the other Xinjiang cities an effective trade
gateway to the west and as far as Europe, through Central Asia, Beijing has
been investing in railways and planning further major investments. China has
built a series of rail links: the first rail services began in 2012, with passage
from western China to Western Europe taking up to three weeks, depending
on destination, instead of five weeks using trucks and ships.66 Furthermore,
China planned to finish upgrading the last section of a transcontinental high-
way from Lianyungang (a Chinese port in Jiangsu Province, in the east coast)
to St. Petersburg in Russia, which would pass through Almaty, Kazakhstan’s
most populous urban centre. Initial indications for this project suggest it was
going to be finalized and opened in 2016. The logistics terminal in the port
of Lianyungang was jointly built by China and Kazakhstan in order to make
it a platform for transporting Central Asian goods to overseas markets. The
first phase of the terminal’s construction, concluded in 2014, required an in-
vestment of US$ 98 million. More construction phases and more investments
were expected to follow.67
In 2015, Kazakhstan continued to maintain its leadership as a prin-
cipal destination of China’s foreign investments. During Chinese Premier
Li Keqiang’s visit in 2014, the two countries signed US$ 14 billion worth of
economic deals, and the March 2015 Kazakhstani Prime Minister Karim
Qajymqanuly Massimov’s visit to China added another US$ 23.6 billion of
economic deals.68 In Kyrgyzstan, the PRC, with a US$ 850 million allowance
from the state-owned China Export-Import Bank (or Exim Bank), has been
financing the construction and reconstruction of major highways. In Tajik-
istan, with a US$ 900 million loan, Chinese companies have been building
roads linking the capital, Dushanbe, with other important towns. In 2013,
China signed a contract with Uzbekistan worth US$ 455 million for the
construction of a railway tunnel. Furthermore, in its 2015 hearing before
the US and China Economic and Security Review Commission, professor
Sebastien Peyrouse of George Washington University highlighted Chinese
extensive investments in Central Asia, using China Exim Bank or China
Development Bank funds, in sectors such as hydroelectricity, telecommuni-
cations, uranium, and cement.69
2014; ‘5 Things to Know about Horgos and China’s New Silk Roads’, The Wall Street
Journal, 9 November 2014.
66. US – China Economic and Security Review Commission, 2015 Annual Report
to Congress, Chapter 3 ‘China and the World’, Section 1 ‘China and Central Asia’, 2015
(http://www.uscc.gov/Annual_Reports/2015-annual-report-congress), pp. 391-427.
67. ‘5 Things to Know about Horgos and China’s New Silk Roads’; ‘China-Ka-
zakhstan Logistics Terminal Opens in Lianyungang’, Xinhuanet, 20 May 2014.
68. Shannon Tiezzi, ‘China’s Silk Road in the Spotlight as Xi Heads to Kazakh-
stan’, The Diplomat, 8 May 2015.
69. U.S.-China Economic and Security Review Commission, Hearing on Looking
West: China and Central Asia, written testimony of Sebastien Peyrouse, 18 March 2015
37
Francesca congiu
China’s «going out – going west» investment policies, as part of the

Silk Road Economic Belt project, have headed farther west, beyond Central
Asia, and targeted Eastern and Western Europe, enhancing the opportu-
nities for the growth of financial cooperation among China, Europe, and
European-member states. In June 2015, Hungary was the first European
country to sign a cooperation pact, inserting her in China’s New Silk Road,
when Chinese Foreign Minister Wang Yi and his Hungarian counterpart,
Peter Szijarto, signed an MoU, the first of its kind between China and a
European country.70 Also, at the end of 2014, a new direct railroad line
between Europe and Asia was launched: the first direct freight train to con-
nect China and Spain reached Madrid after a journey of around 13,000
kilometres. The journey lasted 21 days, starting from Yiwu, a Chinese city
on the east coast. It was meant to be the longest rail route in the world – sur-
passing even the combined 12,250 kilometres covered by the Trans-Siberian
Railway and the Orient Express routes – and of course, a major internation-
al link between Europe and Asia. The route crossed Kazakhstan, Russia,
Belarus, Poland, Germany, and France before reaching Spain.71
Aside from direct freight railroads, China was also planning to build a
high-speed passenger railway between China and the United Kingdom and
between Beijing and Moscow. The first would entail an investment of US$
150 billion and would take approximately ten years to be completed.72
Furthermore, this long Eurasian corridor was supposed to be com-
plemented by several smaller corridors, such as: the Bangladesh-Chi-
na-India-Myanmar Economic Corridor aiming to connect Yunnan, the
south-western Chinese province with the Bay of Bengal,73 the rail servic-
es aiming to connect Nepal to Thailand as part of a MoU on railway co-
operation signed by China and Thailand in December 2014, and, more
important, the China-Pakistan Economic Corridor connecting Kashgar
in Xinjiang with the port of Gwadar in Pakistan through roads, rails, and
pipelines. This last project was discussed at a forum on the China-Pakistan
Economic Corridor held in Xinjiang in August 2015, which was attended by
hundreds of officials and delegates from companies and think tanks. At the
(http://origin.www.uscc.gov/sites/default/files/Annual_Report/Chapters/Chapter%20
3,%20Section%201%20-%20China%20and%20Central%20Asia.pdf).
70. ‘Hungary is first in Europe to sign up for China’s New Silk Road Plan’, South
China Morning Post, 7 June 2015.
71. ‘First direct China-Madrid freight train arrives after epic 13,000 km jour-
ney’, El Pais, 10 December 2014.
72. ‘More Talks Needed on High-Speed Rail Link’, China Daily, 5 July 2014;
‘China to Design New Russian High-Speed Railway’, The Wall Street Journal, 19 June
2015.
73. Zaara Zain Hussain, ‘Initiative for “Southern Silk Route”. Linking Bangla-
desh, China, India, and Myanmar’, Institute of South Asian Studies Working Paper, n.
192, 17 June 2014.
38
China 2015
forum, the two countries signed 20 cooperation agreements accounting for

US$ 1.6 billion projects.74
5.2. From the East China Sea to the Mediterranean Sea and Africa coasts:
re-building the ancient maritime routes.
Maritime routes are as important as land routes to China’s economy,
as most goods in the global-trade economy are transported by ship. Being
the world’s largest trading nation, China is the major destination and a key
starting point of international shipping routes. According to a Clingendael
report, seven out of the ten busiest container ports in the world are posi-
tioned in China, with the port of Shanghai being the world’s largest; three
Chinese shipping companies are among the twelve largest container trans-
porters in the world; China is the largest shipbuilding nation in the world;
Chinese firms are particularly dynamic in the construction and manage-
ment of ports around the world.75
China’s effort to build a new maritime route officially started in 2013
in Southeast Asia. At the time, major Chinese foreign investments were
committed to the region, through bilateral or multilateral agreements on
infrastructure building. This happened notwithstanding the heated mari-
time territorial disputes, which were pitting China against several Southeast
Asian countries (Philippines, Vietnam, Malaysia, Brunei, and Taiwan), and
the United States.76 As suggested by Cai Penghong, a Senior Fellow at the
Shanghai Institute for International Studies, maritime cooperation between
China and ASEAN started in the early 1990s. However, since the launch of
the Maritime Silk Road in Indonesia in 2013, every major agreement and
commitment, although previously signed or taken, has gone under the ban-
ner of the New Maritime Silk Road project.77 In particular, the year 2015
was declared, in relation to the project, as the «ASEAN-China year of mari-
time cooperation». Indeed, 2015 was particularly marked by a great number
of visits by high-level Chinese officials to Southeast Asian countries.78
74. ‘The China-Pakistan Economic Corridor gets even more ambitious’, The
Diplomat, 13 August 2015; ‘News Analysis: railway cooperation with China ushers in
new era for Thai infrastructure development’, Xinhuanet, 20 December 2015.
75. Frans Paul van der Putten & Minke Meijnders, China, Europe and the Mari-
time Silk Road.
76. Francesca Congiu, ‘La Cina sull’orlo di una crisi politica e internazionale:
l’anno del 18° congresso del PCC’, Asia Maior 2012, pp. 379-383.
77. Cai Penghong, ‘China-ASEAN Maritime Cooperation: Process, Motivation
and Prospects’, China International Studies, July-August 2015, pp. 26-40. See also: Liu
Cigui, ‘Reflections on Maritime Partnership: Building the 21st Century Maritime Silk
Road’, China Institute of International Studies, 15 September 2015 (http://www.ciis.org.
cn/english/2014-09/15/content_7231376.htm).
78. Ibid; ‘Top Official’s Visit to Southeast Asia Advances China’s Neighborhood
Diplomacy’, Xinhuanet, 28 July 2015.
39
Francesca congiu
Among the ASEAN countries, Vietnam, one of the main players in

the South China Sea’s territorial disputes and the site of several anti-China
riots,79 was a major focus of China’s Maritime Silk Road initiative in 2015.
In April, the General Secretary of the Communist Party of Vietnam, Nguyen
Phu Trong, visited China. On that occasion, the two countries signed two
MoUs aimed at founding two working groups: one for infrastructure coop-
eration and another for finance and currency cooperation. In July, Chinese
Vice Premier Zhang Gaoli visited Vietnam, to be followed in November by
Xi Jinping, the first Chinese President to visit Vietnam in over a decade.
The major proposal that emerged from all of these high-level meetings was
the need to combine China’s Belt and Road initiative with Vietnam’s «Two
Corridors and One Economic Circle» plan. This plan, proposed in 2004 by
Vietnam and endorsed by China, refers to: the «Kunming – Lao Cai – Ha-
noi – Haiphong transport corridor», the «Nanning – Lang Son – Hanoi -
Haiphong transport corridor», and the «Beibu Gulf Rim Economic Circle».
The two transport corridors and the economic circle, the latter also known
as Gulf of Tonkin Economic Belt, defined the economic region comprising
south-western China, and northern and central Vietnam. During Xi’s visit,
the two countries signed agreements concerning party-to-party coopera-
tion, infrastructure, trade, investment, culture, and education. In particular,
Xi committed to loan US$ 158 million over the following five years for the
conclusion of a high-speed railway project.80
Also, Laos, Thailand, Malaysia, and Singapore were part of a large
3,000-km-long regional railway project involving China, which would connect
Kunming, the capital and largest city in Yunnan Province, Southwest China,
to the Southeast Asian markets. On 1 December 2015, Zhang Dejiang, the
chairman of the Standing Committee of China’s National People’s Congress,
went to Laos to attend the celebration of the 40th anniversary of the founding
of the Lao People’s Democratic Republic. The visit followed the formal start
of the construction of the China-Laos high-speed railway, which was part of
the bigger construction plan. The project entailed a total investment of US$
6 billion, 70% of which came from China and 30% from Laos. The intention
was to build a 418-kilometre railway departing from Kunming and arriving in
Vientiane, the capital of Laos.81
Beijing’s plans to develop a network of ports and coastal infrastructures
involved all countries along the maritime route until the door of Western
Europe, where the China Ocean Shipping Company (COSCO), a Chinese
79. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, p. 24.
80. ‘Keep Brotherly Friendship for Better Sino-Vietnam Future’, CCTV.com, 11
July 2015; ‘China, Vietnam to Link Development Initiatives’, Xinhuanet, 6 Novem-
ber 2015; ‘China, Vietnam Pledge to Boost Strategic Partnership’, Xinhuanet, 17 July
2015; ‘China’s Xi Misses the Mark on Vietnam Visit’, The Diplomat, 6 November 2015.
81. ‘China, Laos to Build $6 Billion Railway by 2020’, The Diplomat, 16 Novem-
ber 2015; ‘China, Laos Pledge to Further Develop Ties’, Xinhuanet, 2 December 2015.
40
China 2015
state-owned enterprise, was developing the port of Piraeus in Greece into

a major hub at the European end of the Maritime Silk Road. At the end of
2015, the COSCO Group was in pole position to obtain the majority stake
of Piraeus Port, thanks to the privatization process launched by the Greek
government. In 2008, COSCO had already obtained one of the two Piraeus
terminals as a 35-year concession. Since then, a Chinese-built railway has
been constructed to connect the Greek port with Central Europe’s three
major ports of Hamburg, Rotterdam, and Antwerp.82 It was also remarkable
that each of these three European ports maintained very special relations
with China. China was indeed considered the port of Hamburg’s most im-
portant trade partner. In October 2015, the Bank of China and the port of
Rotterdam authority signed a MoU in an effort to strengthen their recipro-
cal investments, and the port of Rotterdam affirmed its will to cut for itself
the role of a key logistic hub in the Chinese network of the Belt and Road.
Furthermore, at the end of 2015, the port authority chairman of Belgium’s
port of Antwerp, Marc Van Peel, declared he would warmly welcome Chi-
nese investments in the port in order to make it part of the Chinese Belt and
Road project in line with a long tradition of friendship between the Belgian
port and China.83
As in the ancient maritime silk route, Africa was meant to be an inte-
gral part of the new development as well. Chinese infrastructure building
in Africa certainly preceded the launch of the OBOR project. Nevertheless,
since its launch, Chinese infrastructure activities in Africa started to be pre-
sented as an integral part of the Maritime Silk Road initiative. This was the
case of the Kribi Port project in Cameroon, the first phase of which started
in 2011. This first phase’s cost amounted to US$ 568 million, of which 85%
came from China and 15% from the Cameroon government, but the fi-
nal expense was projected to reach US$1 billion. Furthermore, the Chinese
were also committed to build roads and railways connecting the new port
to major urban areas in Cameroon, which would give birth to an integrated
industrial area.84
According to Brian Eyler, Deputy Director of the Southeast Asia pro-
gramme at the Stimson Center in Washington DC, Africa’s role in the Mari-
time Silk Road was not secondary to that of Europe. It was, on the contra-
ry, a primary focus, not only of the current Chinese international political
82. ‘China’s Next Target? A Strategic Greek Shipping Port’, Fortune, 10 April
2015; ‘China Cosco is Sole Bidder for Stake in Greece’s Piraeus Port’, The Wall Street
Journal, 23 December 2015.
83. ‘China Confirms Itself as the Port’s Most Important Trade Partner’, Ham-
burg-news, 19 June 2014; ‘Port Authority and Bank of China Enter into Strategic Alli-
ance’, Portofrotterdam.com, 29 October 2015; ‘Belgian Port of Antwerp eyes active role
in promoting new «Silk Road»’, Xinhuanet, 28 October 2015.
84. ‘What’s it Like to Have China Build You a Port? Ask Cameroon’, The Diplo-
mat, 27 February 2015.
41
Francesca congiu
economy but also of Southeast Asian countries’ trade interests.85 According

to Eyler, behind the Maritime Silk Road project and, in particular, behind
the complex rail links connecting Yunnan to Southeast Asia, there was a very
well-organized cooperation between China and the most advanced Southeast
Asian economies in order to jointly exploit the growing markets in Africa, the
Middle East, and South Asia. Southeast Asia – by providing strategic port fa-
cilities and exporting goods, such as Thai rice, alongside with Chinese prod-
ucts – was indeed a key actor in the construction of the Maritime Silk Road.
This connection between some Southeast Asia countries and China was also
visible in the joint China-Thailand project, aimed at building a canal connect-
ing the South China Sea to the Andaman Sea, through the Isthmus of Kra.
This project bypassed the Malacca Strait, seen by China as a dangerous choke
point, where, in case of military confrontation, the US could easily cut off the
Chinese routes to West Asia and East Africa. Eyler describes the Maritime Silk
Road as «a network of exporters formed of commercial interests from China
and advanced economies in Southeast Asia sending manufacturing and food
exports to Africa’s growing markets while importing valuable minerals and
metals from African trading partners».86 According to the author, Thailand
was the most-interested Southeast Asian country in the commerce with Africa:
thai rice exporters are likely to be one of the main beneficiaries of the Asia-
Africa link under the MSR (Maritime Silk Road) plan. Already 60 per cent
of Thai rice exports in 2013 are headed for Africa.87 With the purpose of
controlling the Asia-Africa trade, Beijing has been developing 12 deep-water
ports, seven of which along the African coasts (Djibouti, Dares Salaam, Mapu-
to, Libreville, Tema, Dakar, and Bizerte), while, at the same time, constructing
airports, railroads, and highways.88
6. Financing the OBOR: China-led multilateral financial institutions

and funds and the IMF democratization process
China’s infrastructure diplomacy of the Belt and Road project has been
complemented by the foundation of a number of China-led multilateral
financial-institutions and development funds: the Silk Road Fund, the En-
ergy Development Fund, the Maritime Silk Road Bank, and the so-called
Asian Infrastructure Investment Bank.
China announced the creation of the US$ 40 billion national Silk Road
Fund in November 2014. The fund was meant to be financed from Chi-
85. Brian Eyler, ‘China’s Maritime Silk Road is All about Africa’, East by South-
east.com, 17 November 2014.
86. Ibid. (§. 3).
87. Ibid. (§. 7).
88. ‘China Steps up Drive to Integrate Africa into Silk Road’, The Hindu, 21
January 2015.
42
China 2015
na’s foreign currency reserves (accounting for about 65% of the fund), from
the government’s sovereign wealth fund, and from the Exim Bank and the
China Development Bank. In the case of the Silk Road Fund, China was
the sole founder and founding source.89 The Energy Development Fund
was, on the contrary, meant to be a multilateral fund aimed at investing in
energy infrastructure along the Silk Road land and maritime routes. The
idea of this fund was conceived by the China Energy Fund Committee, a
Hong Kong-based think tank concerned with global energy cooperation
that sought both Chinese funds and foreign investments, aiming at putting
together US$ 20 billion.90 Among the strategies to raise enough money to
finance the ambitious OBOR initiative, there was also the project to create
a Maritime Silk Road Bank, a project for which several ASEAN countries
have shown the intention to contribute, in an effort to raise US$ 16 billion.91
The launch of the AIIB initiative – already mentioned above –coincided
with the OBOR launch in October 2013. However, its constitution was only
completed in 2015. The final text of the AIIB founding document (Articles
of Agreement) was adopted at the 5th Chief Negotiator Meeting on 22 May
2015 in Singapore and was signed by 57 Prospective Founding Members be-
tween 29 June and 31 December of the year under analysis. By 31 December
2015, 18 members among the 57 had ratified the agreement. More members
were expected to ratify the document by the final deadline of 31 Decem-
ber 2016.92 The AIIB’s main declared goal was to support the «development
of infrastructure and other productive sectors in Asia, including energy and
power, transportation and telecommunications, rural infrastructure and agri-
culture development, water supply and sanitation, environmental protection,
89. US-China Economic and Security Review Commission, 2015 Annual Report
to Congress. Chapter 3 China and the World, US Government Publishing Office Washing-
ton, November 2015 (http://www.uscc.gov/Annual_Reports/2015-annual-report-con-
gress); Sarah Lain & Raffaello Pantucci, ‘The Economics of the Silk Road Economic
Belt. Workshop Report’, Royal United Services Institute for Defence and Security Studies,
Occasional Paper, London 2015 (https://rusi.org/sites/default/files/20151126_cr_eco-
nomics_of_the_silk_road_economic_belt.pdf).
90. ‘New fund initiated for Silk Roads’, Global Times, 25 January 2015; China
Energy Fund Committee, Press Report, 25 January 2015 (http://www.cefc.org.hk/a-
list/6177-eng).
91. ‘Jinrong jiama zhichi yidai yilu: haishang sichouzhilu yinhang zheng chou-
jian’, Zhongguo zhengquan bao, Ministry of Finance of the People’s Republic of China, 13
November 2014.
92. The Chief Negotiator Meeting was a forum established by Prospective
Founding Members in order to negotiate and agree on the Articles of Agreement.
See AIIB website: ‘History of AIIB’ (http://www.aiib.org/html/aboutus/introduction/
history). For updated information on the membership status see also: ‘Signing and
Ratification Status of the AOA of the AIIB’ (http://www.aiib.org/html/aboutus/intro-
duction/Membership). See also the bank’s chart: Asian Infrastructure Investment
Bank, Articles of Agreement, Chapter XI, art. 58 (http://www.aiibank.org/html/aboutus/
Basic_Documents).
43
Francesca congiu
urban development and logistics […]».93 The bank had a founding base of
US$ 100 billion, with China contributing approximately 30% of the initial
capital and holding the largest number of shares (30.34%), followed by India
(8.52%), Russia (6.66%), and Germany (4.57%). China’s capital shares gave
her 26.06% of voting rights, followed by India (7.51%), Russia (5.93%), and
Germany (4.15%). Since AIIB constitution required 75% of voting rights for
deciding key issues, such as changes in the bank’s capital base or in the board
of directors, China de facto enjoyed veto power.94
The AIIB foundation acquires a more-profound meaning if connect-
ed with the long-run battle over the IMF (International Monetary Fund)
reforms aimed at democratizing its governance. The IMF reform process
was officially launched in 2009 at the G20 in Pittsburgh, and the year after
produced two agreements on IMF reform that needed to be ratified by the
single countries involved. The reform was aimed at increasing the fund’s
financial resources from roughly US$ 330 billion to US$ 660 billion and
shifting more than the 6% of quota shares to emerging markets and devel-
oping countries in a major effort to reflect the dramatic changes in world
economy and the greater economic weight of developing countries. At that
time, notwithstanding the extraordinary changes in the world-economy bal-
ance of powers, the IMF voting rights’ distribution continued to be quite
similar to the one established in 1944, when the IMF and the World Bank
were created at the Bretton Woods Conference. Still, in 2015, the US con-
trolled 16.7% of voting rights, while China, the second largest economy,
controlled only the 3.8%, highlighting a clear asymmetry between its weight
in the global economy and its role in the governance of IMF. Through the
proposed reforms, Brazil, Russia, China, India, and South Africa, the five
major emerging economies forming the so-called BRICS, enjoyed a total in-
crease of 4.5% of voting share corresponding to 14.3% of total voting power.
In this way, China would become the third-largest member country in the
fund and the US’s quota share would be reduced from 16.7 to 16.5%, which,
however, leaves her veto power to key IMF issues untouched. However, this
reform process was stalled for five years, as the US Congress finally author-
ized it only in mid-December 2015.95
93. See AIIB website: ‘What is the Asian Infrastructure Investment Bank?’
(http://www.aiib.org/html/abouts/introduction/aiib).
94. Asian Infrastructure Investment Bank, Articles of Agreement, Chapter V, art. 28
(http://www.aiibank.org/html/aboutus/Basic_Documents/). See also: ‘China to hold 30
per cent stake in AIIB and 26 per cent voting rights’, South China Morning Post, 29 June
2015.
95. Francesca Congiu, ‘Il processo di modernizzazione cinese tra «multipolari-
smo e polarizzazione»’, Asia Maior 2009, pp. 233-34; ‘Implementing IMF Governan-
ce: baby steps in slow motion’, Brettonwoods Project, 29 November 2010, (http://www.
brettonwoodsproject.org/2010/11/art-567219); ‘IMF Fails to Approve IMF Reform’,
Financial Times, 14 January 2014; Robert Wade & Jakob Vestergaard, ‘Impasse at the
IMF’, Brettonwoods Project, April 2015 (http://www.brettonwoodsproject.org/2015/03/
44
China 2015
The most remarkable aspect, related to the AIIB foundation, has been
the unexpected enthusiastic response to China’s initiative from the United
States’ allies within Asia as well as within Europe, including South Korea,
India, Philippines, Australia, the United Kingdom, Germany, Italy, and
France. Together, they have given a significant legitimacy in supporting this
new China-led multilateral financial institution in spite of American and
Japanese refusal to join and, above all, US lobbying efforts against it. Ac-
cording to Chinese press and academics, this has been a major diplomatic
victory for China, particularly if the UK’s critical position on IMF reform
impasse and its positive stance on AIIB set up are taken into account.96
As noticed by Lu Feng, professor of Economics at Beijing University, «[…]
In a rare case of disagreement with the US, the United Kingdom, France,
Germany, Luxembourg and Switzerland all applied to join the AIIB. This
symbolic development marks the rise of emerging economies, with China
as their representatives, and is a prelude to the restructuring of the global
financial system».97
The AIIB has not been the sole multilateral financial institution cre-
ated as a result of the emerging markets and developing nations’ dissatisfac-
tion with the Bretton Woods architecture. In July 2014, China contributed
to establish, together with the other BRICS countries, the New Develop-
ment Bank (NDB).
The NDB – funded following the Fortaleza Declaration, made at the
6th BRICS Summit – was officially launched in July 2015. However, the pro-
ject had been under discussion among BRICS countries since around 2012.
Among the major goals of the bank, the Fortaleza document highlighted
the objective of financing infrastructure and sustainable development pro-
jects in developing countries by increasing the amount of money at their
impasse-at-the-imf); ‘US Congress Ratifies IMF Quota Reforms’, Xinhuanet, 19 De-

cember 2015; ‘IMF Governance: one step forward, one step back’, Brettonwoods Proj-
ect, 8 February 2016, (http://www.brettonwoodsproject.org/2016/02/imf-governance-
one-step-forward-one-step-back).
96. Pang Zhongying, ‘What Does Europe’s AIIB Entry Mean for China and
US?’, Chinausfocus.com, 1 April 2015 (http://www.chinausfocus.com/foreign-policy/
what-does-europes-aiib-entry-mean-for-china-and-u-s). See also: David Daokui Li,
‘The AIIB as China’s Pilot Attempt to Reform the Global Economic Governance’, Chi-
nese People Institute of Foreign Affairs The 116th Issue Summer 2015 (http://cpifa.org/en/q/
listQuarterlyArticle.do?articleId=332); ‘US Urges Allies to Think Twice Before Join-
ing China-led Bank’, Reuters, 17 March 2015; ‘Meiguo Guo fandui tigao Zhongguo
IMF huayu quan zao Yingguo caizhang qianglie piping’, Caijing, 8 December 2015;
‘AIIB qihang, Zhongguo lun haishi shijie hao’, China.org, 28 December 2015 (http://
opinion.china.com.cn/opinion_20_142920.html); Agatha Kratz, ‘China’s AIIB: a
triumph in public diplomacy’, China Analysis, June 2015 (http://www.ecfr.eu/page/-/
China_analysis_belt_road.pdf).
97. Lu Feng, ‘The Change in the Attitude of Most Western Powers Toward the
China-Proposed Asian Infrastructure Investment Bank Can Only be Termed Dra-
matic’, China Daily, 18 April 2015.
45
Francesca congiu
disposal. The bank was established with an initial capital of US$ 50 billion
and an emergency reserve fund of US$ 100 billion.98 The document openly
asserts the BRICS countries’ disappointment with the impasse in IMF re-
forms. In fact, the Fortaleza document states «We remain disappointed and
seriously concerned with the current non-implementation of the 2010 In-
ternational Monetary Fund (IMF) reforms, which negatively impacts on the
IMF’s legitimacy, credibility and effectiveness».99 On the NDB official web
site, it is furthermore specified that: «The New Development Bank BRICS
[…] is a multilateral development bank operated by the BRICS states […] as
an alternative to the existing US-dominated World Bank and International
Monetary Fund. The Bank is set up to foster greater financial and develop-
ment cooperation among the five emerging markets. […] Unlike the World
Bank, which assigns votes based on capital share, in the New Development
Bank each participant country will be assigned one vote, and none of the
countries will have veto power».100
6.1. The West divided over the AIIB/China question

From the end of 2014 till the end of 2015, the AIIB question was the
cause of significant turbulence in US-Europe relations as well as in US-Aus-
tralia relations. The West has thus been divided over an issue concerning
China and how to deal with its rise in a way that, in spite of the deep differ-
ences in context and meaning, brings to mind the 1950s and 1960s, when a
more-open European stance on how to deal with China was counter-posed
to a total American closure.101
As reported by the Australian Financial Review, between the end of
2014 and the beginning of 2015, the US repeatedly tried to dissuade Aus-
tralia from joining the AIIB, stating its official concerns about the nature
of the AIIB objectives, its standards, and the fact that the bank would give
the possibility to enhance China’s military capacities in the region. In par-
ticular, the US was worried about China’s having veto power over the AIIB’s
decision-making body, as this would further empower its foreign policy.102
98. Rajiv Biswas, ‘Reshaping the Financial Architecture for Development Fi-
nance: The new development banks’, LSE Global Studies Unit. Working Paper Series,
n. 2, 2015.
99. Ministry of External Relations, Brazil, Press Release, ‘Fortaleza Declara-
tion, 6th BRICS Summit’, July 2014 (http://brics.itamaraty.gov.br/media2/press-
releases/214-sixth-brics-summit-fortaleza-declaration).
100. ‘About the NDB’, New Development Bank BRICS homepage.
101. Carla Meneguzzi Rostagni & Guido Samarani, La Cina di Mao, l’Italia e
l’Europa negli anni della guerra fredda, Bologna: Il Mulino 2014.
102. ‘Abbott Missed an Opportunity with China’, Australian Financial Review, 26
November 2014; ‘Stop Thinking the «Worst» about China: Kevin Rudd’, Australian
Financial Review, 18 February 2016; ‘US Anger at Britain Joining Chinese-led Invest-
ment Bank AIIB’, The Guardian, 13 March 2015.
46
China 2015
Among Western countries, the ice was broken in March when the United
Kingdom announced its decision to become an AIIB founding member; af-
ter the UK, other Western countries, Australia included, followed its lead.103
The US had an unusual and almost immediate public reaction: the 12th
March issue of the Financial Times anonymously quoted an Obama admin-
istration official accusing the UK of «a trend of constant accommodation
with China, which is not the best way to engage a rising power».104 The
anonymous official further argued that the British decision had been taken
when the G7 was still in the midst of a debate in order to develop a compre-
hensive common approach towards the bank.105
The issue at stake between the US and the rest of the West seemed to be
what stance to take vis-à-vis China’s ambiguous attitude towards the interna-
tional system and its rules: engagement or containment. In this specific case,
the US – whose own policy towards China has constantly wavered between
the two stances since Nixon’s times – was adopting a containment stance.
Washington argued that the best way to be sure that China’s AIIB would
have been willing to abide by high-level international standards on workers’
rights, environment, and corruption would be by putting pressure on Bei-
jing from outside the AIIB. On their part, European countries claimed that,
from inside the bank, they would be by far more effective in pushing China
to follow those international rules. Of course, behind the divided American
and European stance, so remarkable and, above all, so openly shown for the
first time in history, there were diverging national priorities.
At that point, the US seemed far more worried about defending its
declining global hegemony rather than securing her already-solid economic
relations with China. As explained by Tobias ten Brink, America’s greater
ability, in comparison to the other countries, to deal with her own trade
deficits, her massive military expenses and the recurring economic crises
was not only due to China being the principal owner of the US national debt
but also to the absolute global dominance of the US dollar. The US dol-
lar global dominance, however, has been under attack for several years, as
shown by at least two crucially important developments. The first is the use
of currency-swap agreements finalized to substitute the US dollar with the
Chinese yuan in commercial exchanges, especially among Asian countries.
The second development is China’s diversification policies of international
financial investments, aiming at substituting US bonds with those from oth-
er international sources. In a context of increasing threat for the US dollar
dominance, it’s no wonder that the coming to the fore of the BRICS New
Development Bank but, above all, of the AIIB provoked a sharp reaction
103. ‘Europeans Defy US to Join China-led Development Bank’, Financial

Times, 16 March 2015.
104. ‘UK and US in Sharp Row on How to Deal with Rising China’; ‘US Attacks
UK’s «Constant Accommodation» with China’, Financial Times, 12 March 2015.
105. Ibid.
47
Francesca congiu
from the Obama administration.106 Moreover, as previously mentioned, the

competitive pressure in the global market coming from the Chinese global
firms was affecting the US as well as European firms, already seriously dam-
aged by the global economic recession. The Chinese way of internationaliz-
ing firms was often under attack and accused of being unfair for not abiding
by the neoliberal rules of the international market, especially because of the
significant role played by the State in the «Go Global» process.107
While the US seemed to have chosen a radical method to try to force
the PRC to abide by neoliberal rules – by refusing to adhere to the AIIB, lob-
bying their allies not to do it, and creating the TPP, which excludes China
– European countries seemed to have chosen to exploit the benefits of the
Chinese way. Between September and October 2015, just to mention the
most striking example, China and the UK exchanged visits at the highest
level: George Osborne, UK Chancellor of the Exchequer, visited China in
October, and Xi Jinping visited the UK in November. During Xi’s four-day
trip, the two countries issued a document, the UK-China Joint Statement on
Building a Global Comprehensive Strategic Partnership for the 21st Century, which
stated: «This visit opens a golden era in UK-China relations featuring en-
during, inclusive and win-win cooperation». Among the several agreements
on investment, commercial, and financial cooperation, it is worth mention-
ing the fact that China was offered the opportunity to invest in different sec-
tors of the British economy and, in particular, in the nuclear sector. Further-
more, London was chosen as the first-ever financial centre outside China in
which to open a sovereign debt market in Chinese renminbi.108
On the whole, the great absence in the current triangular relations
among the PRC, the US, and the UK was the usual Western pressure over
China for human rights’ protection. David Cameron had indeed been refus-
ing to host the Dalai Lama since they last met in the UK in 2012, provoking,
at that time, harsh reactions from China. During Xi Jinping’s visit in October
2015, Prince Charles, a well-known supporter of Tibetan human rights, re-
fused to participate in the state banquet. However, he hosted Xi and his wife
at his Clarence House London Mansion and avoided meeting the Dalai Lama
when the Tibetan leader visited the UK in September, just one month before
the Chinese President’s visit. Moreover, in 2014, London absolutely failed
in supporting the Hong Kong pro-democracy movement against Beijing, a
behaviour that has been defined «deferential» and «shameful» by Hong Kong
pro-democracy activists. Lastly, in 2015, during his official visit in September,
Mr. Osborne visited Xinjiang in spite of the controversial and harsh Chinese
the Liberal Global Economic Order’, p. 42; Francesca Congiu, ‘Il processo di mod-
ernizzazione cinese tra «multipolarismo e polarizzazione»’, pp. 233-34.
107. Francesca Congiu, ‘China 2014: China and the Pivot to Asia’, pp. 18-30.
108. ‘UK-China Joint Statement 2015’, Foreign & Commonwealth Office, 22 Octo-
ber 2015 (https://www.gov.uk/government/news/uk-china-joint-statement-2015).
48
China 2015
repressive policy against Uyghur separatism. His goal was to try to assure UK
lucrative construction contracts in the province in line with the overall aims
of the Chinese OBOR project.109 Notwithstanding this poor record by the UK
government in defending Chinese human rights, the main argument used
by the US to confront the UK decision to join the AIIB completely eschewed
any reference to this problem. As noted above, the Obama administration’s
critique was indeed related to a supposedly wrong way to «engage a rising
power».110
7. «Seeking new models of international cooperation and global governance»

in a changing international landscape
In 2015, the «One Belt, One Road» initiative was proposed by the Chi-
nese leadership as a new and innovative Chinese foreign-policy strategy,
potentially able to reform global governance and democratize international
relations. As stated by an official Chinese press agency: «The [OBOR] plan
is expected to change the world political and economic landscape through
development of countries along the routes, most of which are eager for fresh
growth».111
The point of departure and the legitimacy basis for this strategy –
which, as already noted, were not new in Chinese foreign policy but which
were reaffirmed with significant emphasis by the fifth generation of Chinese
leaders – was Xi Jinping’s Address at the Fourth Central Conference on
Work Relating to Foreign Affairs (Zhongyang waishi gongzuo huikuai), held in
Beijing on 28-29 November 2014.112 The Conference, chaired by Premier
Li Keqiang, was the first on foreign affairs since 2006 and was attended by
the entire Politburo Standing Committee, by central and local civilian and
military bureaucrats, by almost all Chinese ambassadors, and by commis-
sioners of the Ministry of Foreign Affairs to both the Hong Kong and Macao
109. ‘UK woos China during Xi visit’, World Socialist Website, 21 October 2015;
‘Dalai Lama on Britain’s Policy Towards China: «Money, Money, Money. Where is
Morality»’, The Independent, 23 September 2015; ‘Hong Kong Activist Attacks «Def-
erential» Britain’, The Telegraph, 5 September 2014; ‘Osborne Seeks Trade in China’s
Restive Xinjiang Region’, Financial Times, 23 September 2015.
110. ‘US anger at Britain joining Chinese-led investment bank AIIB’, The
Guardian, 13 March 2015.
111. ‘China Headlines: China’s Belt and Road; connecting the world’, Xinhua-
net, 28 March 2015. See also: ‘An Outlook on China’s Diplomacy’, Beijing Review, 19
March 2015; Ministry of Foreign Affairs of the People’s Republic of China, Foreign
Minister Wang Yi Meets the Press, 8 March 2015 (http://www.fmprc.gov.cn/mfa_eng/
wjb_663304/wjbz_663308/2461_663310/t1243662.shtml).
112. Ministry of Foreign Affairs of the People’s Republic of China, The Central
Conference on Work Relating to Foreign Affairs was held in Beijing, 29 November 2014
(http:// http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1215680.shtml).
49
Francesca congiu
Special Administrative Regions. Its main aim was to launch and strengthen
the guidelines, principles, and major goals of China’s diplomacy in a deep-
ly transformed and interdependent international scenario. The core argu-
ment of Xi Jinping’s address was the necessity to develop a new diplomatic
approach in accordance with both China’s long-standing dependence on
the world and the world’s new and growing dependence on China.113 Ac-
cording to Xi, the world and China were so intertwined that, for the sake of
China’s own domestic and international development, the Chinese leader-
ship had, more seriously than in the past, to rethink its diplomacy in terms
of «win-win cooperation» in order to build «a new type of international rela-
tions» (xinxing guoji guanxi).114
In the words of Chinese Foreign Minister Wang Yi: «This important
exposition of President Xi Jinping is a synthesis of the new diplomatic theo-
ries and practices we have developed in our relations with major countries,
neighbouring countries and developing countries».115 According to Wang
Yi, this diplomatic stance had already brought about the establishment of a
China-centred «global network of partnerships». Since the end of the Cold
War, China had indeed launched a diplomatic strategy aimed at getting
«partners instead of allies».116
Xi Jinping’s theses have been reiterated and given theoretical depth
by some well-known Chinese intellectuals. In one of his articles, Su Ge, the
President of the China Institute of International Studies in Beijing, identi-
fied the 9/11 attacks (2001) and the 2008 international financial crisis as
the major turning points that contributed to modify the international struc-
ture. In Ge’s words: «[…] the economies of the United States and developed
western countries tended towards relative decline while those of some newly
emerging economies experienced new vitality and an increase in strength
and standing […] The G20 summit has become the principal platform for
the international community to cope with the financial crisis, the emerging
countries have enhanced their influence in international affairs, and the
trend of world multi-polarity is becoming increasingly salient».117 In addi-
tion, Su Ge argued that the US, in order to cope with her decline, had pro-
moted her rebalancing strategy towards the Asia-Pacific region and taken a
hard line on what she judged the unfair competition practices of the emerg-
ing economies. This hard line had found expression in both the Transpa-
113. ‘Xi eyes more enabling int’l environment for China’s peaceful develop-
ment’, Xinhuanet, 30 November 2014.
114. Ibid; ‘The Central Conference on Work Relating to Foreign Affairs was
held in Beijing’.
115. ‘Full Text of Foreign Minister Wang Yi’s Speech on China’s Diplomacy in
2014’, Xinhuanet, 26 December 2014.
116. Ibid.
117. Su Ge, ‘Transformation of International Structure and China’s Diplomatic
Strategy’, China International Studies, July-August 2015, pp. 5-25 (§. 6).
50
China 2015
cific Partnership Agreement and the Transatlantic Trade and Investment

Partnership (TTIP), which had been conceived with the goal «to bypass or
replace relevant WTO rules and formulate a capital operation system that
overrides state sovereignty».118 Likewise Ding Yuanhong, previous Ambas-
sador in the European Union and former Director of the Policy Research
Center of the Ministry of Foreign Affairs, identified the shifting balance of
power between developed and developing countries as one of the major
factors of change in the international architecture.119
This vision, which highlighted the need for a rebalance in global gov-
ernance, was further enhanced, with special reference to Asian countries,
by the rhetorical concept of the so-called «community of common destiny»,
propounded by Xi Jinping in his speech at the Boao Forum for Asian Annu-
al Conference of March 2015.120 In Xi Jinping’s speech – integrated by the
remarks of Chairman of the National Committee of the Chinese People’s
Political Consultative Conference Yu Zhengsheng, and of Chinese vice-pres-
ident Li Yuanchao121 – the «community of common destiny» substantially
appears as another expression to indicate Chinese aims and efforts to pro-
mote a different type of international relations and global governance. As
stated by Li Yuanchao, China proposed itself as the «proponent, supporter
and facilitator» of the process aiming at reaching this goal.122
Although most of the rhetorical discourse around the «community of
common destiny» was especially addressed to Asian countries, China’s de-
clared aims were effectively and ambitiously directed to the whole world. In
Li Yuanchao’s own words: «The destiny of the Chinese people is insepara-
ble from that of people of all countries, so are our dreams and aspirations
closely connected with those of other people. China actively advocates a
community of common destiny for all».123
The Asian «community of common destiny» was essentially intended in
two forms: Asian economic integration and Asian security. In an undeniable
effort to deal with the extraordinary escalation of military and economic ten-
sions in the East and South China Seas, Xi Jinping asked Asian countries to
«shelve differences and seek common grounds».124 In particular, apart from
118. Ibid. (§. 9).

119. Ding Yuanhong, ‘Different Perceptions of International Order’, Chinese
People Institute of Foreign Affairs, 115th Issue, Spring 2015.
120. ‘Towards a Community of Common Destiny and a New Future for Asia’,
Full text of Chinese President’s Speech at Boao Forum for Asian Annual Conference 2015 –
China.org, 29 March 2015.
121. ‘Advance Asian Security for Common Development. Remarks by Yu Zheng-
sheng’; ‘Working together to Build a Community of Common Destiny for World
Peace and Security. Remarks by Li H. E. MR. Li Yuanchao’, Chinese People Institute of
Foreign Affairs, 115th Issue, Autumn 2015.
122. Ibid.
123. Ibid.
124. ‘Towards a Community of Common Destiny and a New Future for Asia’ (§. 12).
51
Francesca congiu
the OBOR project, he mentioned the efforts that the «Asian community»
had been putting into the ongoing project to build an East Asian economic
community and the ongoing negotiations for the Regional Comprehensive
Economic Partnership (RCEP). The former was expected to be completed
in 2020, while the deadline for the latter was projected for the end of 2015.
However, at the time of this article’s writing, the latter agreement was yet
to be closed. It is worth noting that the RCEP was a comprehensive free-
trade agreement and involved ten member ASEAN economies plus six of
the current free-trade agreement partners (Australia, China, India, Japan,
South Korea, and New Zealand). Seven of these countries (Australia, Japan,
Malaysia, New Zealand, Singapore, Vietnam, and Brunei) were also part
of the US-led and already-concluded TPP. In that regard, it is relevant to
mention Xi Jinping’s encouragement, directed towards Asian countries, to
«oppose interference in other countries’ internal affairs and reject attempts
to destabilize the region out of selfish motives».125 Although implicit, this
was a clear criticism of the US military and economic rebalancing to Asia.
125. ‘Towards a Community of Common Destiny and a New Future for Asia’.
52
korean peninsula 2015: one step Forward and two steps back*
Barbara Onnis and Marco Milani
University of Cagliari Università di Bologna

bonnis@unica.it marco.milani6@unibo.it
In 2015, in South Korea, President Park Geun-hye’s decline in popularity, which

had begun in the previous year, further accelerated. In particular, the outbreak of the
MERS (Middle East Respiratory Syndrome) crisis between May and June contribu-
ted, once again, to show the government’s inability to act quickly and effectively. The
already difficult situation worsened in Autumn, following the vehement protests or-
ganized by different sectors of the South Korean civil society against the school history
textbooks reform and the new labour legislation.
North of the 38th parallel, President Kim Jong Un moved quickly to definitively
strengthen his power. A new series of purges hit the members of the political and mili-
tary leadership. At the same time, there was the consolidation of the new Kim-inspired
political line. Part of it can be considered the announcement that the Seventh Plenary
Congress of the Party was to be held for the first time after 36 years in 2016. In May
and June, a severe drought affected North Korea. However, the limited 2013 agricul-
tural reforms, avoided the outbreak of a real famine.
A major crisis in inter-Korean relations was triggered by the explosion, in August, of
two landmines in the southern side of the de-militarized zone. However, the two parts
reached an agreement that, besides solving the landmines issue, paved the way for a
new round of family reunions and a new series of high-level inter-governmental talks.
2015 saw the consolidation of the excellent relationship between Seoul and Beijing,
highlighted both by the participation of South Korean President Park Geun-hye – the
only US ally – in the military parade that took place in early September in Tiananmen
square, and by the signature, in December, of a bilateral Free Trade Agreement. Also
the relations between South Korea and Japan improved significantly after almost three
years of diplomatic freeze. The rapprochement materialized with a bilateral summit
between the leaders of the two governments, in November, and with a historic agreement
on the vexed issue of the «comfort women», signed on 28 December. This was welcomed
by the US, which had made significant efforts to favour this result. There were also
positive repercussions on the relations among the three Northeast Asia powers.
2015 was the year of North Korea President Kim Jong Un «missed debut» on the
international scene. Although Kim was expected to take part in several important
international events, this did not happen. Nonetheless Pyongyang further deepened
the already positive relations with Russia. On the contrary, the difficult Sino-North
Korean relations, after a moment in which they seemed headed for an improvement,
* Even if the present chapter is the outcome of a joint research effort, it is pos-
sible to ascribe sections 2 and 3 to Marco Milani, and sections 1 and 4 to Barbara
Onnis.

BarBara Onnis & MarcO Milani
remained strained. Regarding the relations with Japan, the deadlock on the issue of
Japanese citizens abducted by North Korean secret agents in the 1970s and 1980s
put an end to a timid improvement in the Tokyo-Pyongyang relations.
1. Introduction
For South Korea, 2015 was the year that confirmed the already on-
going decline of President Park Geun-hye. In particular, after the Sewol
incident in 2014, the crisis erupted with the outbreak of the Middle East
Respiratory Syndrome (MERS) disease in the country, between May and
June, demonstrating once again the lack of leadership of a government that
intervened slowly and late, just like in the ferry sinking case. Not surprisin-
gly, the first moment of social and political tension, which occurred in 2015,
coincided with the anniversary of the Sewol tragedy, in April, during which
both the President and the Prime Minister were strongly criticized. Soon
afterwards, the resignation of the Prime Minister for a corruption scandal
and the outbreak of MERS worsened the popularity of the government even
more. A further controversial point in the relation between the executive
and the public opinion emerged in the last months of 2015, when the go-
vernment decided to put forward two highly contested reforms: the history
textbooks and the labour reforms.
As for North Korea, domestic policy continued to be dominated by
Kim Jong Un’s process of consolidation of power, with further purges within
the party and the military, especially during Spring. The main event was
represented by the celebrations for the seventieth anniversary of the found-
ing of the Workers’ Party of Korea (WPK) and the announcement of the
convocation of a Plenary Congress of the WPK in 2016, the first in over 35
years, in which Kim’s consolidation of power will most likely take its defini-
tive shape with the launch of a new policy line.
Regarding inter-Korean relations, the trend of highs and lows, which
emerged during 2014, remained the norm until August when a new crisis
erupted due to the explosion of land mines in the demilitarized zone, south
of the border, in which two South Korean soldiers were wounded. The alle-
gations from Seoul to Pyongyang led to an escalation of tension that ended
only in late August with an agreement between the parties. As has happened
before, the resolution of a crisis also represented a new opportunity for co-
operation resulting in the family reunions, which took place at the end of
October, and working-level meetings in view of a high-level inter-Korean
summit.
As far as international relations are concerned, the most important
event in the South was certainly represented by the meeting between Park
Geun-hye and Abe Shinzō, which put an end to a three-year period of cold
relations, detrimental not only to their bilateral rapport but also to their
54
Korea 2015
relationship with the USA. The meeting took place in Seoul at the begin-
ning of November, on the sidelines of the trilateral summit among South
Korea, China, and Japan.1 Although it did not achieve anything substantial,
the summit signalled a highly significant symbolic thaw in the Japan-South
Korea relationship. In the meantime, the relationship with China continued
to grow stronger and deeper, as was clearly demonstrated by the participa-
tion of South Korea in the Chinese V-Day. In that occasion South Korea was
one of the few highly developed nations and the sole US ally attending the
event.
For North Korea, 2015 can be considered the year of the «missed de-
but» of Kim Jong Un on the international stage. He was first expected to at-
tend the Asian-African Conference (the Bandung Conference) in Indonesia
in April, and then, in May, the commemoration in Moscow of the seventieth
anniversary of the Soviet Union’s victory in World War II. Kim, however,
cancelled both visits. The second was a widely anticipated event, but Kim’s
cancellation was hardly a surprising announcement, since most observers
were rather sceptical about whether the North Korean leader would go to
Moscow in his first-ever foreign trip. Likewise, Kim did not even accept the
invitation from China to attend the huge military parade in September,
marking China’s victory over Japan in 1945. Instead, Kim dispatched his
personal representative, Choe Ryong Hae, who, at the event, was refused
even a brief meeting with the Chinese President, while, at the same time,
the South Korean President was received with all the honours. The deterio-
rating trend in the North Korean-Chinese relationship – which has become
a constant with the Kim Jong Un-Xi Jinping era – was somewhat reversed
following Liu Yunshan’s arrival in Pyongyang to join the celebrations of the
seventieth anniversary of the KWP foundation. Liu, who is one of the seven
members of the Politburo Standing Committee, was in fact the first high-
ranking Chinese politician to visit North Korea in 4 years. With Japan, rela-
tions were at a standstill as Tokyo waited, in vain, for a report on the thorny
issue of the abductions of Japanese citizens by North Korea.
2. Domestic politics
2.1. South Korean domestic politics:

the dark sides of Park Geun-hye’s presidency
The negative trend in the management of domestic policy by South
Korean President Park Geun-hye, already visible during 2014, reached its
nadir in 2015. The President, in fact, failed to recover the consensus lost
1. The 2015 trilateral summit was the first after its suspension three years be-
fore, caused by the unresolved issues related to the three countries historical past.
55
since April 2014, after the Sewol tragedy.2 Moreover, Park had to face several
new crises that further undermined her popularity and exposed her weak
leadership skills.
The first half of Park’s five year presidency can be exemplified through
the convex shape of a parabola. The first year and a half, up to the sin-
king of Sewol, were characterized by a growing consensus among the public
opinion and the strengthening of her power within the Conservative Party.
This was due especially to the strong economic results and her active mana-
gement of foreign policy. From April 2014, following her difficulty in ma-
naging the ferry tragedy, things changed decisively. The inability to take a
leading role in the country in a time of tough crisis weakened her leadership
role, while her popularity entered an apparently irrecoverable downward
trend for the entire second half of 2014 and throughout the following year.
If 2014, in fact, opened with popularity rate for the President that reached
and exceeded 60%, the following year opened with a free fall in consensus,
which in January barely reached 35%.3
As a political figure, Park Geun-hye has been strongly characterized by
her leadership skills and her decision-making capacity. Political experience
was a hallmark of her campaign, and helped her to overcome gender bias
deeply rooted in the conservative electorate. The daughter of authoritarian
President Park Chung-hee (1961-1979), Park Geun-hye became First Lady
at 22, after her mother’s death in 1974, following an attack by a North Kore-
an commando aimed to kill her father. In 1998, she was elected for the first
time to the National Assembly; a position to which she was re-elected four
times, and which held until the presidential election. From 2004 to 2006,
she became chairperson of the party, a position in which she obtained an
impressive number of important electoral victories earning her the nickna-
me «Queen of Elections». When she took the leadership of the party, in fact,
the Conservatives were in one of the lowest moments of their political path.
Park’s leadership resulted in her party’s strong and unexpected result in the
2004 parliamentary elections. During her two years at the helm of the party,
the Conservatives won in all re-elections and by-elections, regaining the ma-
jority in 2006. In the following year she suffered what can be considered the
only setback in an otherwise brilliant political career. She was beaten in her
party’s primary election for the 2007 presidential bid, albeit by a small mar-
gin, by the popular mayor of Seoul, Lee Myung-bak, who became President
shortly thereafter. Within a few years, however, Park had the opportunity
to have her revenge; in 2011, in fact, as a result of a dramatic slump in the
popularity of the party, linked to the collapse of President Lee’s consensus,
the party was renamed Saenuri dang («New Frontier Party») and Park Geun-
2. On the sinking of the Sewol and its consequences see Marco Milani & Barbara
Onnis, ‘Penisola coreana 2014: «ombre» all’interno e «luci» all’esterno’, Asia Maior
2014, pp. 99-135.
3. ‘Park’s approval rating hits record low’, The Korea Herald, 16 January 2015.
56
Korea 2015
hye was appointed to head an Emergency Committee for the revival of its
popularity, a role that made her the de facto leader of the party. This new
situation paved the way toward the presidential nomination of 2012 and the
subsequent election.4
Her long electoral and political experience gave President Park a re-
solute and combative political image, which appeared to be characterised
by strong leadership skills and the ability to take decisions in difficult times.
The first year and a half as the head of the country highlighted these fe-
atures. In particular, her firm stance towards North Korea, in the months
following the third underground nuclear test in February, 2013, and the
hard line against Abe Shinzō’s Japan, characterized by a strong nationalist
approach, related in particular to the historical memory of the period of Ja-
panese occupation, had a largely positive effect on her popularity. However,
as already noted, all this started to change and Park’s popularity nosedived
following the April 2014 Sewol tragedy.
2.1.1. The Government reshuffle

In 2015, the first difficulties that the President had to face materialized
in February. In fact, between 16 and 17 February, Park decided to imple-
ment a cabinet reshuffle both to regain public trust after the disappointing
results of the previous year, and to strengthen the government ability to
enact reforms. The issue of greater importance was linked to the figure of
Prime Minister Hong Chung-woon, who had submitted his resignation in
April 2014 after the protests following the Sewol incident, but who was still
acting as Prime Minister. Chung was still holding the position only because
the government had failed to find a viable and acceptable candidate to re-
place him. After ten months of deadlock, the choice fell on Lee Wan-koo,
the leader of the Conservative Party, in the National Assembly. The parlia-
mentary hearing for his confirmation showed a strongly divided Assembly
when it came to choosing his name, as he was accused by the main opposi-
tion party (NPAD) of several ethically questionable issues in his past: from
having avoided conscription to real estate speculation and collusion with
the military junta during the 1980s.5 Thus, the parliamentary confirmation
for the new Prime Minister, the only member of the government that, after
the appointment by the President, must pass a parliamentary hearing and
a vote in the National Assembly, became a political battleground between
the two main parties.
The cabinet reshuffle did not seem to bring about the results expect-
ed by the President. The government push for reforms, focusing on the
4. Chico Harlan, ‘South Korea’s new leader, Park Geun-hye, was pushed onto
political stage by tragedy’, The Washington Post, 25 January 2013.
5. ‘National Assembly Narrowly Backs New PM’, The Chosun Ilbo – English Edi-
tion, 17 February 2015.
57
economy, - especially the reform of the labour market, considered of para-

mount relevance to go back to high rates of growth - was slow to materialize,
while the popularity of the executive did not seem to benefit much from the
choice of new members. The first real test that the government had to face
was the first anniversary of the sinking of Sewol, a tragedy which continued
to be problematic for Park Geun-hye, also one year later. On 16 April, in
fact, exactly one year after the sinking, the victims’ families refused to meet
the President at a commemoration and prevented the Prime Minister from
accessing another event in memory of the victims.6 The two facts clearly
showed that the public opinion, and especially the families of the victims,
considered the government’s responsibilities in what happened to be very
serious. In particular, the main target of their rage was the inaction of the
government in carrying out its role in protecting and assisting the citizens.7
However, the month of April proved to be very problematic for the gov-
ernment not only for the anniversary of the sinking of Sewol. The new Prime
Minister, Lee Wan-koo, who took office a few months earlier, was, in fact,
involved in a scandal for accepting, in the past, an improper gift from a busi-
nessman. On 9 April, Sung Woan-jong, a South Korean businessman under
investigation for the failure of a number of energy projects, was found dead
from an apparent suicide. In one of his pockets, the police found a hand-
written piece of paper containing the names of politicians with the sums that
Sung allegedly paid to each of them. Among these names there were also a
number of leading members of the ruling party and some of the President
Park’s closest associates, one of which was the newly-appointed Prime Min-
ister, Lee Wan-koo.8 Although Lee denied any wrongdoing, the decision to
include him in an investigation by a special team of the Attorney General
aimed at shedding light on the issue, led him to resign on 21 April. The resig-
nation was accepted and formalized the following week. As a result, South Ko-
rea was again without a Prime Minister; the Minister of Finance and Deputy
Prime Minister, Choi Kyoung-hwan, was appointed acting Prime Minister.9
The thrust for renewal and reform, launched by President Park Geun-hye
to boost the action of her government, recover consensus among the public
and, above all, regain her identity as a strong political leader, crashed, after
a few months, against the typical rocks of South Korean politics: bribery and
collusion between political authorities and economic and financial entities. In
spite of new scandals and new protests, in the 29 April by-elections, Saenuri
dang, the President’s party, managed to win 3 out of the 4 available seats,
6. Park Ju-min & Kim Sohee, ‘Angry and divided, South Korea mourns on an-
niversary of ferry disaster’, Reuters, 16 April 2015.
7. Sangyoon Nathan Park, ‘A Government, sinking’, Foreign Policy, 19 November
2014.
8. Cho Chung-un, ‘P.M. under siege in graft scandal’, The Korea Herald, 14 April
2015.
9. Do Je-hae, ‘Premier Lee served only 63 days’, The Korea Times, 21 April 2015.
58
Korea 2015
while the NPAD, the main opposition party, suffered a stinging defeat includ-
ing the loss of the historically Democratic stronghold city of Kwangju, to an
independent candidate, previously a member of the NPAD.10 Albeit very lim-
ited in scope, these elections seemingly showed that the electorate, despite its
disillusionment and discontent with the government, was even less inclined
toward the opposition party, foreshadowing a very complicated scenario for
the general elections, scheduled for April 2016.
2.1.2. The MERS crisis

The crisis that seriously tested the executive, however, took place in June
2015 with the outbreak of the MERS crisis and lasted until the end of July.
In late May, in fact, the first case of this disease was confirmed in the country,
isolated in a 68-year-old patient, returning from a trip to Bahrain, via Qatar.
The insufficient controls by the South Korean health authorities brought the
number of infected to 7 before the end of May. On 2 June, the first two deaths
due to MERS were confirmed, while the number of detected cases rose to 25,
mainly among hospital staff, patients, and visitors, and the number of people
quarantined went up to 680.11 Although MERS did not constitute a real threat
– as reaffirmed by the World Health Organization – from this point on, the
country was swept by a wave of mass panic, lest the disease would spread un-
controlledly. This mass panic was amplified by the inefficiency shown by the
health authorities, but also by the entire government’s lack of communication
skills and leadership, confirming what had emerged as the main problems of
the Park Geun-hye administration in the recent past.
The virus, in fact, was not identified in the first patient for nine days, a
period during which he travelled to different hospitals to receive treatment,
in both the capital and the suburbs. As a consequence, patients and medical
staff were infected in the health facilities where the first patient was treated.
Once the medical problem was detected, government authorities decided not
to disclose the name of the hospitals at which the MERS infected people re-
ceived assistance, with the intent not to create panic in fellow patients and
the population living nearby. This policy, however, resulted in scaring the
population away from health facilities, while the lack of information further
increased the panic. Only about twenty days after the registration of the first
case, the government decided to make public all the information in its pos-
session.12 The first weeks of June were thus dominated by a crisis created
more by the mistakes of the government than by the real health risks. After
10. Steven Denney, ‘South Korea’s Liberal Party Woes Continue’, The Diplomat,
30 April 2015.
11. Park Ju-min & Kim Jack, ‘South Korea reports first two deaths from MERS
respiratory illness’, Reuters, 2 June 2015.
12. Choe Sang-hun, ‘MERS Tarnishes Korean President’s Image as Leader’, The
New York Times, 12 June 2015.
59
recalibrating the intervention, in fact, the situation quickly returned to nor-

mal and, by the end of the month, the MERS crisis was finally contained. It
took, however, one more month, until 25 July, before the authorities officially
declared the MERS outbreak over. The final tally was 189 people infected, 36
victims, most of them belonging to debilitated categories, and several thou-
sand people held in quarantine. The social and economic consequences were
even worse: schools and kindergartens closed for several weeks, many social
events and public activities were suspended or cancelled, trade and tourism
were negatively affected. In June, more than 100,000 visitors from China and
Hong Kong cancelled their reservations, and even South Koreans tried to
avoid crowded places, such as markets, malls, and shopping areas, with the
inevitable economic consequences. The Bank of Korea decided to intervene
through a US$ 590 million fund for small and medium businesses affected
by the MERS crisis.13 The adverse economic effects of the epidemic were lim-
ited by its rapid resolution; however, these adverse effects, although limited
in time, hit the South Korean economy hard, at a time when it had already
slowed down.
The slow and inadequate response to the crisis and the «monopoly of
information», put in place in order not to cause panic but producing the op-
posite effect, became the main criticism made to the government. They were
the same criticisms raised in the aftermath of the Sewol tragedy. Once again,
the figure of the President was seen as detached from the rest of the popula-
tion, its sufferings, and concerns, characterized by an authoritarian attitude
towards the other members of the government, dangerously reminiscent of
the authoritarian regime of her father, but with less and less authority in the
public eye.
2.1.3. The Autumn protests against the government

The MERS outbreak was not the only obstacle that the presidency had
to face during the course of 2015. After the summer storm, or rather, with
the autumn months, a number of initiatives launched by the government
met fierce opposition from broad sectors of civil society. This opposition
took the form of a series of massive demonstrations, especially during the
month of November, to which the government responded with a heavily au-
thoritarian and repressive attitude. One of the central issues around which
the dissent of the population focused, had to do with a very sensitive top-
ic for South Korean public opinion: historical memory. On 12 October, in
fact, the South Korean government announced a reform according to which,
by 2017, the history textbooks for middle and high schools would be pub-
13. Choe Sang-hun, ‘South Korean Retailers Pinched by MERS’, The New York
Times, 22 June 2015.
60
Korea 2015
lished by the government itself, rather than by private publishing houses.14

A measure of this kind immediately unleashed a wave of protests by many
groups in civil society, organizations related to the world of education and
ordinary citizens, who considered this approach to be a dangerous limitation
to pluralism in education and information and an example of governmen-
tal interference that dated back to the period of authoritarianism in the
country. During Park Chung-hee’s years in office, in fact, there was only
one single government-sponsored history textbook in schools, in which the
dictator’s coup was presented as a revolution and the authoritarian regime
was justified.
The opponents of the reform feared the possibility that the new gov-
ernment manuals would provide a milder interpretation of the authoritar-
ian period, in particular the Park years, which is still a controversial issue
within the country. While the harsh repression of civil society and political
opposition continues to be one of the hallmarks of the period from 1961 to
1979, on the other hand, the spectacular economic growth of the same years
brought a large segment of the conservative electorate to see Park Chung-
hee regime in a favourable light. The risk was therefore to convey a South
Korean version of the recent past with a perspective mainly linked to the
latter interpretation, fears heightened by the presence of Park’s daughter at
the helm of the country. In addition, progressive opponents were concerned
about the interpretation of obscure and controversial points of the coun-
try’s contemporary history, such as: the period of Japanese colonization, in
particular the collaborationism of many Koreans; the massacres of civilians
during the Korean civil war; and the abuses against political dissidents. The
government and the supporters of the reform, from the conservative camp,
instead, placed emphasis on the need to teach the country’s history without
the ideological bias of leftist movements, and not to inculcate in the young
generation a «masochistic view of history». In this case, the main focus of
the criticism was the emphasis given by many extant history textbooks to the
obscurities of South Korean history, the soft attitude towards North Korea,
with which they emphasized the common ethnic origins and cultural affini-
ties, an excessively tolerant view of the North Korean regime, and the latent
feeling of anti-Americanism that led many textbooks to negatively assess the
US role in peninsula’s history.15
Ironically, many of the reasons given by Park’s government to support
the textbook reform, especially the «masochistic view of history» formula,
were the same used in Japan to support the adoption of textbooks with a
14. Jeon Jung-yoon & Lee Se-young, ‘After 42 years, state history textbooks are
on the way back’, The Hankyoreh – English Edition, 13 October 2015.
15. Oh Tai-kyu, ‘Things that all South Koreans can be sad about’, The Hankyoreh
– English Edition, 12 November 2015.
61
decidedly revisionist perspective about the imperial period, a decision that

had sparked strong protests in South Korea.16
The textbook reform, strongly supported by the government for the
entire month of October, was finally approved on 3 November, unleashing
protests and fears in broad sectors of the public opinion.
These protests converged with those against the government new
labour legislation, aimed at increasing the competitiveness of South Ko-
rean industries. The unions, in particular, lashed out against a policy that
would make dismissal easier and quicker, claiming that it was a gift to
the country’s cash-filled conglomerates – chaebol – while an increasing
share of workers had to survive with precarious and low-paid jobs. On
Saturday, 14 November, the anger of these broad sectors of public opin-
ion led to a huge demonstration in the streets of Seoul, the largest since
the candlelight vigils in 2008.17 Tens of thousands of people – 130,000
according to the organizers, 68,000 according to the police – gathered in
City Hall Square, protesting against Park Geun-hye, her textbooks poli-
cy, and the new labour reform. The event also had a violent aspect, with
clashes between police and protesters leaving dozens wounded on both
sides.18 The political consequences came quickly. In fact, in the aftermath
of the event, the Saenuri dang decided to defend the actions of the exec-
utive, condemned the protests and considered the demonstration illegal;
at the same time, the work of the police was praised, a tough response
against the organisers, especially trade unions leaders, was demanded,
and an iron fist policy against any similar future event was advocated. On
the contrary, for the opposition the police response was disproportionate
while the government was guilty of not listening to these important re-
quests from civil society.19 A few weeks after the event, the Minister of Jus-
tice, Kim Hyun-woong, reiterated the determination of the government
to suppress future unauthorized demonstrations, targeting in particular
a new rally organized for Saturday, 5 December.20 In the end, this new
demonstration had a much lower impact than the previous one, and did
not trigger any violence.
16. Alexander Bukh, ‘Japan’s History Textbooks Debate: National Identity in

Narratives of Victimhood and Victimization’, Asian Survey, Vol. 47, No. 5, 2007, pp.
683-704.
17. The candlelight vigils were a series of protest demonstrations that involved
tens of thousands of people, between May 2008 and July 2008, held in Seoul, to pro-
test against the decision of the government to lift the ban on the imports of US beef,
in place since December 2003 for the BSE disease.
18. ‘Labour unions, activists hold massive rally in Seoul’, Yonhap News Agency,
14 November 2015.
19. ‘Rival parties split over violence at protest rally’, Yonhap News Agency, 16
November 2015.
20. Lee Hyun-jeong, ‘Justice minister warns against protests’, The Korea Herald,
27 November 2015.
62
Korea 2015
These developments of the last months of 2015 had a very negative

impact on the figure and on the popularity of the President. A survey con-
ducted in the aftermath of the protests showed, in fact, a big drop in the
approval of the government action, located mainly in the South-eastern ar-
eas, which constitute the main bastion of support for Park Geun-hye.21 The
year ended with a new cabinet reshuffle, in which key members of the exec-
utive were replaced, including the Ministers of Finance, Education, Interior,
Trade and Equal Opportunities, precisely in order to revive the action of
the government, especially in the economic field, and to recover consensus,
before the general elections scheduled for April 2016.22
Like the previous year, 2015 also ended in South Korea with a strong
decline in the popularity of the President and a number of shadows cast on
the quality of democracy in the country. Park Geun-hye’s authoritarian tone
did not translate, in fact, into political leadership at the helm of the country,
especially during times of crisis, and created considerable concern in large
parts of civil society. This situation was amplified by the family legacy from
which Park could not escape and currently represents a double-edged sword
in the South Korean political landscape.
2.2 North Korean domestic politics: towards the launch of a new political line
2015 represented a new evolution in the political path of North Ko-
rean leader Kim Jong Un. After the «purges» and the induction of new po-
litical figures of proven loyalty in 2013 and 2014,23 the new young leader
started to implement and formalize a new policy, directly associated with his
image as the new leader of the party and the country. In 2013, the party’s
standing committee had already approved the new political guideline called
byungjin (parallel development), aimed at simultaneously pursuing the nucle-
ar programme and economic development. The rationale was that the deve-
lopment of a credible nuclear deterrent could be used to free resources from
the military apparatus and devolve them to the pursuit of a higher degree of
economic development. Just like the son’gun (military first policy) launched
by Kim Jong Il in the 1990s, consisted in putting more emphasis on a parti-
cular aspect within the ideological framework of Juche (self-reliance), likewise
byungjin was launched as a further evolution based on son’gun and within the
broader ideology of Juche.
During the spring of 2015, the North Korean regime carried out se-
veral missile tests, which appeared to be as messages to South Korea and
21. ‘Park’s approval rating sinks by 13% in stronghold’, The Korea Herald, 16
November 2015.
22. Kim Han-joo, ‘Cabinet reshuffle to affect April elections’, The Korea Observer,
21 December 2015.
23. See Marco Milani & Barbara Onnis, ‘La penisola coreana: tra «facce nuove»
e un continuo dejà-vu’, Asia Maior 2013, pp. 378-381; and Marco Milani & Barbara
Onnis, ‘Penisola coreana 2014: «ombre» all’interno e «luci» all’esterno’, pp. 108-111.
63
the United States, engaged at the time in joint military exercises. At the
same time, according to South Korean intelligence sources, a new series
of «purges», targeting important members of the regime, took place. On
29 April, in fact, an audition of the South Korean National Intelligence
Service (NIS) to the National Assembly reported the news of the execution
of 15 senior regime officials during 2015, including a number of deputy
ministers.24 Soon after, on 13 May, the NIS published a new report, accor-
ding to which North Korean minister of defence general Hyon Yong Chol
had been charged with treason and executed.25 In this case, however, some
doubts about the reconstruction of the South Korean intelligence service
arose. Several South Korean analysts, in fact, argued that Hyon’s close pro-
ximity to Kim Jong Un in propaganda films transmitted during the same
week of the alleged execution demonstrated the unreliability of the infor-
mation; in fact, it is standard practice for North Korea to remove the name
and the figure of leaders in disgrace as the first step of their ouster. In ad-
dition, according to the NIS, the sentence would have been carried out on
30 April, but until that day Hyon’s name appeared in the main newspaper
of the regime, the Rodong Sinmun, thus making the general’s execution
highly unlikely.26 The doubts about Hyon’s demise remained; however,
during the summer, the regime officially replaced him at the helm of the
defence ministry with Pak Yong Sik, who was promoted to the rank of Ge-
neral in April 2015. These alleged new «purges», and in particular Hyon’s
case, gave life to a number of conflicting interpretations. In all probability,
however, these changes can be explained as without any high political rele-
vance and such not to undermine the stability of the regime. They appear
to be part of the strategy of power consolidation of the new leader. Kim, in
fact, keeps a firm grip on power, with periodic removals of his high-level
staff to further cement its control. This constant shuffling is intended to
stoke fear among high officials, both civilian and military, who have to
manoeuvre in an unpredictable and dangerous political environment.27
Moreover, those who are promoted usually are faithful to the one who
guaranteed them a new position of power.
As summer approached, however, the regime had to face other priori-
ties. The spring and early summer were characterized, in fact, by an almost
total lack of rainfall, which caused a severe drought. By the end of May, the
24. ‘N. Korea executed 15 senior officials this year: spy agency’, Yonhap News
Agency, 29 April 2015; Choe Sang-hun, ‘North Korea Executed 15 Top Officials in
2015, South Korean Agency Says’, The New York Times, 29 April 2015.
25. ‘North Korea defence chief «executed with anti-aircraft fire»’, Mail Online,
13 May 2015.
26. Choe Sang-hun, ‘Some Doubt That North Korea Executed a Top General’,
The New York Times, 13 May 2015.
27. Alexander Mansurov, ‘The Rise and Fall of General Hyon Yong Chol’, 38th
North, 14 July 2015.
64
Korea 2015
first alarm about possible of food shortages in the country was sounded,
and, in mid-June, the situation became serious enough to push the national
news agency to announce that the country was facing the worst drought in
the last 100 years and that 30% of the rice crop was lost.28 The announce-
ment by one of the official organs of the state was probably a move aimed at
obtaining international assistance.
When problems occur in food production in North Korea, the first
thought is always to the tragic famine of the 1990s. However, despite the se-
verity of the problem, the 2015 drought was not comparable to the situation
prevailing in the 1990s, thanks to the fact that agricultural production had
grown in a decisive manner from 2011 onwards, with record harvests both in
2013 and in 2014. The main reason for this improvement was the reforms
introduced by the regime, which had allowed families to register as «produc-
tion unit» and keep for themselves 30% of the crop. This new mechanism
linked the well-being of farmer families to their productivity.29 Fortunately,
in the last weeks of June and early July, the amount of rainfall normalized,
thereby limiting the impact of the drought.
During the month of August, the North Korean regime took a further
decision aimed at symbolic self-assertion; on 7 August, in fact, it announced
the creation of a Pyongyang time zone, set 30 minutes earlier than the cur-
rent one – and eight hours and 30 minutes ahead of GMT. The reason for
this change was that the time zone of the peninsula had been decided by the
Japanese during the colonial period. To commemorate the seventieth anni-
versary of the liberation of the peninsula from the colonial rule, the regime
established that, from 15 August, the exact anniversary of the Japanese deci-
sion, the time zone of Pyongyang would no longer be the same as Japan – or
as South Korea.30 The practical implications of the decision were actually very
few, given the poor integration of the country into the global economic and
trade mechanisms; the only minor problems in communications took place
in Kaesong, where South Koreans and North Koreans are working together.
The significance of the decision was therefore exclusively symbolic; but, un-
fortunately, more than marking a break with Japan, the decision was likely
to disrupt the efforts of integration between the South and the North of the
peninsula, as exemplified by the case of the industrial park in Kaesong.
On 10 October, the seventieth anniversary of the founding of the WPK
took place. The anniversary was celebrated with a grand parade in the ca-
pital, one of the largest in the history of the country, in which the regime
showed all its military force. Kim Jong Un, in his first public speech since
28. ‘Severe Drought Hits DPRK’, KCNA – Korean Central News Agency, 16 June
2015.
29. Andrei Lankov, ‘Should We Be Worried About North Korea’s Drought?’,
Foreign Policy, 23 June 2015.
30. ‘Pyongyang Time Fixed in DPRK’, KCNA – Korean Central News Agency, 15
August 2015.
65
2012, which lasted 25 minutes, affirmed his love and his dedication to the
people, thanked North Koreans for their support despite the sanctions and
blockades of the international community, and promised improvements in
the economy and in the citizens’ living standards. Regarding the military
aspects, Kim repeated that the country and its military were ready to sup-
port «any kind of war» against the United States to defend the independen-
ce of the motherland, with a clear reference to the nuclear program.31
On 30 October, the regime called for the seventh Congress of the Party
in 2016, the first since 1980.32 After 36 years, this unexpected convocation
immediately gave rise to a series of speculations. According to several obser-
vers, the choice of convening a Party Congress was related to Kim Jong Un’s
effort at consolidating his own power. A Congress would definitively solidify
the changes that had taken place in recent years, primarily the policy guide-
line of byungjin, and perhaps would pave the way for future and more pro-
found changes. Undoubtedly, in recent years the emphasis on the nuclear
program has been accompanied by deep changes in the economic system,
which led the country’s socialist economy to be increasingly influenced by
elements of market economy. The Congress could thus be an opportunity
to definitively ratify these changes of the internal system of the country.33
3. Inter-Korean relations
3.1. The spring highs and lows on the peninsula

The year 2015 opened under positive auspices for inter-Korean rela-
tions. During 2014, a number of constructive events took place between
the two Koreas. In particular, the new round of family reunions in February
2014, and the inter-Korean high-level meeting, in October,34 paved the way
for a positive beginning of the upcoming year.
On the first day of 2015, Kim Jong Un’s New Year’s speech to the
nation contained conciliatory messages towards Seoul, including the recog-
nition of the importance of improving inter-Korean relations and the pos-
sibility for a meeting with President Park. The speech, however, was not fol-
lowed by any concrete actions from either side. As such, the first months of
the year passed by without any remarkable event in inter-Korean relations.
31. ‘Kim Jong Un Makes Speech at Military Parade and Public Procession of
Pyongyang Citizens’, KCNA – Korean Central News Agency, 11 October 2015.
32. ‘Seventh Congress of WPK to Be Convened’, KCNA – Korean Central News
Agency, 30 October 2015.
33. Park Hyeong-jung, ‘What to Expect from the 7th Korean Workers’ Party
Congress?’, KINU Online Series, CO 15-30, 20 November 2015.
34. See Marco Milani & Barbara Onnis, ‘Penisola coreana 2014: «ombre»
all’interno e «luci» all’esterno’, pp. 111-116.
66
Korea 2015
In spring, as usual, North Korea decided to test missiles and held mili-
tary drills in the East Sea on several occasions. In the early days of March,
some short-range missiles were launched as a protest against the annual
joint exercises in the area between the United States and South Korea; on
the first days of April, a new round of missile launches was carried out just
in time for the visit of US Secretary of Defence, Ashton Carter. This move
was considered by many not as accidental, but rather as a signal sent from
Pyongyang to the international community, in particular to Washington.35
In May 2015, after some questionable claims by both governments, tension
rose again, culminating in North-Korean rounds of artillery fire, this time
in the West Sea. The move by Pyongyang, which nonetheless decided to
give the southern counterpart advanced warning, seemed to have the goal
of raising the tension in the area, and revive the dispute between the two
countries related to their maritime border.36 In fact, despite more than sixty
years of fait accompli, the so-called Northern Limit Line (NLL) – namely
the extension of the border into the sea that was established with the 1953
armistice – has never been recognized by Pyongyang, resulting in periodical
naval skirmishes between the two countries. 37
3.2. The August crisis

The most crucial month for inter-Korean relations was definitely Au-
gust. At the beginning of the year, a series of expectations emerged, due to
the recurrence, on 15 August, of the seventieth anniversary of the liberation
of the peninsula from Japanese colonial rule. Unfortunately, these expecta-
tions were betrayed.
The month of August opened with a possible sign of a thaw, name-
ly the visit to North Korea by the former First Lady of South Korea, Lee
Hee-ho. President Kim Dae-jung’s widow enjoyed, in fact, great respect in
Pyongyang, thanks mainly to the efforts towards reconciliation pursued
by her husband in his years as President (1998-2003). However, the South
Korean government decided not to give any political significance to Lee’s
journey, and did not make use of Ms. Lee to send any message to the North
Korean regime during the visit. Surprisingly, North Korea decided to give
35. ‘N. Korea fires 4 short-range rockets into West Sea’, Yonhap News Agency, 3
April 2015.
36. Choe Sang-hun, ‘North Korea Fires Artillery Shells Into Sea Near Disputed
Border’, The New York Times, 13 May 2015.
37. ‘North Korea: The Risks of War in the Yellow Sea’, International Crisis Group.
Asia Report N° 198, 23 December 2010. In 1999 and in 2002, there were the two
battles of Yeonpyeong Island, with many human and material losses on both sides;
in 2009, there was the Battle of Daecheong Island, which caused losses to the North
Korean navy; finally, in 2010, in the same waters, there was the sinking of the South
Korean corvette Cheonan, in March, and the bombing of the South Korean island of
Yeonpyeong, in November.
67
little attention to the initiative as well, avoiding the scheduling of high-level

meetings for Ms. Lee.38 The month continued in an anything but positive
way for the inter-Korean relations. On 10 August, in fact, the South Korean
authorities officially accused North Korea of having placed some landmines
in the southern part of the de-militarized zone; mines that had caused seri-
ous injuries to two South Korean soldiers. According to the South’s military
command, the act was a deliberate provocation by North Korea, carried out
through an operation of infiltration across the border. Immediately, as retal-
iation for the incident, the South Korean government decided to restore the
broadcast of propaganda messages through loudspeakers along the border.
The broadcasts represented one of the most critical points for inter-Korean
relations and were interrupted 11 years before, as a sign of good will on the
path of reconciliation.39
A few days later, Pyongyang denied any involvement in the events, ac-
cusing Seoul of raising tensions on the peninsula, and threatening retaliation
for the resumption of propaganda broadcasts at the border, including the
possibility to hit the loudspeakers installations with artillery. To make matters
worse, some South Korean activists decided to restart the launch of balloons
from the border, carrying banners containing denigrating messages directed
against Kim Jong Un and the North Korean regime. On 15 August, the anni-
versary of the liberation of the peninsula from colonial rule, rather than being
an occasion for reconciliation, turned into a new day of tension. As a result, in
her speech to the nation, Park Geun-hye could not refrain from highlighting
the latest negative developments in inter-Korean relations and stigmatized
North Korea’s behaviour, regarded as provocative and unjustified. In particu-
lar, the South Korean President affirmed that Pyongyang’s attitude, made of
threats and provocations, could only lead to more isolation for the country
and, ultimately, to its destruction. Park went even further, saying that North
Korea would have to undertake a process of rapprochement and opening to
the international community, just like Cuba had recently done. She also stated
that the liberation from the colonial rule could not be considered complete
until the achievement of the reunification of the Korean people.40 The reac-
tion of the North Korean regime to Park’s speech was one of condemnation
and derision, with the usual disparaging tone against South Korea and its
President, pointing out the inconsistency of a message where conciliatory pro-
posals had been mixed up with very harsh accusations.41
38. ‘Ex-first lady visits Pyongyang on hope of better inter-Korean ties’, Asia
Times, 5 August 2015.
39. ‘S. Korea resumes psychological warfare in retaliation against N.K.’, Yonhap
News Agency, 10 August 2015.
40. ‘Speech by South Korean President Park on the Seventieth Anniversary of
Liberation’, Council on Foreign Relations, 15 August 2015.
41. ‘Spokesman for CPRK Slams Park Geun Hye’s «Address on August 15»’,
KCNA – Korean Central News Agency, 15 August 2015.
68
Korea 2015
As a result, tensions rose rapidly on the peninsula. At the same time,

however, in what proved to be a certain degree of schizophrenia in inter-Ko-
rean relations, the two countries agreed to a wage increase in Kaesong joint
industrial park. The issue had been on the table for several months, since
February, and was at the centre of negotiations between the Ministry of re-
unification and its North Korean counterpart. On 18 August, the two sides
finally announced the agreement, introducing a 5% increase in the mini-
mum monthly wages for North Korean workers in Kaesong.42 This decision,
apparently limited in scope, had a significant symbolic aspect. The existing
discrepancy between the high-sounding public rhetoric, especially linked to
the military and security aspects, and the more concrete plans for economic
cooperation demonstrated yet again the need for projects of this kind in in-
ter-Korean relations in order to reach tangible results in easing tension. The
problematic and often-reviled concept of «flexible dualism»,43 introduced in
1997 by former President Kim Dae-jung during the «Sunshine Policy», proved
once again to be a very effective tool for improving the relations on the pen-
insula, and, despite having been officially abandoned since Lee Myung-bak’s
election (2008), it seemed to still be alive and working in practice.
A few days after Park Geun-hye’s speech, tension, already high, rose
even more. In response to the loudspeaker propaganda campaign, and also
to the joint military drills Ulchi-Freedom Guardian between South Korea and
the United States, an exchange of artillery between the two countries broke
out on 20 August, started by rockets apparently fired from North Korea, to
which the South Koreans immediately responded with their own artillery;
the unusual amplitude of this exchange of fire - the first time in five years -
was worrying. The following day, the North Korean regime declared a state
of «semi-war», one of the highest military alerts in the country, declared only
twice in its history, in 1968 and 1993.44 To try to find a way out and avoid a
useless and dangerous escalation, the two Koreas decided to meet two days
later, on 23 August. This first meeting was aimed at intervening quickly
to stop the escalation while, at the same time, laying the groundwork for
an agreement between the two governments. Both delegations were made
up of members of the highest level from both governments: Chief of The
National Security Office Kim Kwan-jin and Minister of Reunification Hong
Yong-pyo represented South Korea, while Hwang Pyong So, considered
number two in the North Korean power structure, and Kim Yang Gon, the
42. Choi Ha-young, ‘Two Koreas finally reach Kaesong minimum wage agree-
ment’, NK News, 18 August 2015.
43. The main point of the concept of «flexible dualism» consists in the separa-
tion of the political and economic spheres in managing inter-Korean relations. For
more information: Moon Chung-in, ‘The Sunshine Policy and the Korean Summit:
assessments and prospects’, East Asian Review, Vol. 12, No. 4, Winter 2000, pp. 3-36.
44. Choe Sang-hun, ‘North Korea and South Korea Trade Fire Across Border,
Seoul Says’, The New York Times, 20 August 2015.
69
secretary in charge of inter-Korean relations, represented Pyongyang’s re-

gime. Another positive signal came through the official channel of infor-
mation of North Korea, the Korean Central News Agency (KCNA), which,
in announcing the meeting, referred to South Korea using its official name,
the Republic of Korea, avoiding any offensive references.45
The meeting of the two high-level officials, which lasted nearly three
days, led to a real agreement, on 25 August, in which the two sides de-
cided to take concrete steps to ease tensions: South Korea would stop the
broadcasts of propaganda messages, while North Korea would withdraw the
«semi-war» alert and express regret for the two South Korean soldiers in-
jured by landmines. Through this formula, Pyongyang could meet the main
South Korean request and, at the same time, did not explicitly recognize any
responsibility in the issue. In addition, the two sides decided to go further,
agreeing to new rounds of family reunions and a series of inter-governmen-
tal high-level meetings, aimed at improving inter-Korean relations.46 A few
days later, the two parties held a meeting to define the dates and modality
of family reunions. On 7 and 8 September, in Panmunjom, the delegates of
the two Koreas agreed to hold two rounds of meetings, between 20 and 26
October, at the tourist facilities located on Mount Kumgang.
With the definition of the details for the family reunions, the «August
crisis» could be considered definitively closed. The events that took place
can be certainly considered significant, as it was the moment of highest
tension since the nuclear test in February 2013 and its aftermath. As had
happened at that time, also in this case the crisis created the possibility of
new spaces for dialogue and cooperation. In an extremely rational way, in
fact, the two sides agreed to negotiate before the situation could lead to a
pointless military escalation, and came up with an agreement that not only
solved the immediate issues, but also created the basis for further positive
developments, especially for what concerns the high-level meetings. The
future developments in autumn and the presence of an overall strategy in
the management of inter-Korean relations would decide if it were a real
watershed, as predicted by many analysts in South Korea, or the umpteenth
agreement destined to expire in silence.
3.3. The new rounds of family reunions and the inter-governmental talks
The second round of family reunions during Park Geun-hye’s admi-
nistration started on Tuesday, 20 October, at Mount Kumgang, in the nor-
thern part of the peninsula. Over 750 Koreans, from both sides of the 38th
parallel, met for two rounds of meetings – the first from 20 to 22 and the
45. ‘North-South High-level Urgent Contact to Be Held’, KCNA – Korean Cen-

tral News Agency, 22 August 2015.
46. Hyun Joon Chon, ‘The Significance of the 8.25 Inter-Korean Agreement and
the Calling of the highest leaders of the two Koreas’, Global Asia Forum, 28 August 2015.
70
Korea 2015
second from 22 to 25 – between members of families separated by the Kore-

an War. Most of the participants were very old, some of them had to be tran-
sported by ambulance to Mount Kumgang, and represented a small fraction
of those still waiting to be reunited with their relatives who live in the north;
in South Korea alone, in fact, their number reaches over 66,000 people.47
The reunions, a highly symbolic and emotional event for the Korean
population, also represent a kind of barometer for the relations between
the two countries at the political level. It is, in fact, a humanitarian issue of
great importance but with little military or political implications, and for
this reason, it is often used as a first step towards future dialogue and coo-
peration, to show the goodwill of the parties. Even in the previous rounds,
in February 2014, the aim was the same. This time the aim was to highlight
the agreement reached in August and the possible developments of the in-
ter-governmental talks that, along with the reunions, constituted the most
important part of the agreement.
In this context, on 19 November the South Korean government accep-
ted a proposal from Pyongyang to hold a preparatory meeting on 26 No-
vember. The session was supposed to be a working-level meeting between
negotiators, with the goal of preparing the ground for a subsequent wide-
ranging and high-level dialogue. The 26 November meeting in Panmunjom
gave a semi-positive result. In fact, although the two sides agreed for the
coming intergovernmental meeting, which was scheduled for 11 Decem-
ber, they decided to limit it to the level of deputy ministers, whereas it was
previously thought of as a meeting between ministers, and to hold it in Kae-
song, a less significant location compared to one of the two capitals.48 These
early warning signs became concrete during the meetings. After marathon
talks that lasted two full days, on 12 December, the parties announced that
they had failed to reach any agreement and decided to suspend the inter-
governmental meetings.49 The main point of friction was the reopening of
the joint tourism program in Mount Kumgang. The project had been one of
the Kim Dae-jung’s administration major achievements in terms of coope-
ration, and consisted of a series of tourist facilities built by the South Korean
Hyundai Asan Fundation on one of the most spectacular and symbolically
highly important mountain, situated in the north. The program had been
interrupted in 2008, however, following the death of a South Korean tou-
rist, killed by North Korean soldiers when she ventured into an off-limits
military area. The representatives of Pyongyang privileged the reopening of
the Mount Kumgang program, while Seoul’s priority remained the issue of
47. ‘Korean families reunited after over six decades of separation’, The Korea
Herald, 24 October 2015.
48. Kang Jin-kyu, ‘South, North only agree to mid-level Dec. Talks’, JoongAng
Daily, 28 November 2015.
49. Yi Whan-woo, ‘Two Koreas fail to reach agreement in Gaeseong talks’, The
Korea Times, 13 December 2015.
71
family reunions. The impossibility to find a common ground on these issues

led to the interruption of the dialogue, without so much as an agreement on
the date of further meetings.
This failure showed how the Trustpolitik, launched by President Park
Geun-hye three years earlier, was struggling to be translated into practice.
South Korea’s lack of a proactive approach to the relations with North Ko-
rea, which translated into facing a crisis at a time without an overall strategy
of trust-building, proved to be the main cause of the impossibility to build
mutual trust between the parties, and create a new course of inter-Korean
relations.
4. International relations
4.1. Seoul and Beijing: friends as never before… under the gaze of Washington
In 2015, the already very good bilateral relationship between Seoul
and Beijing became even more intense, reaching its apex in the second part
of the year. The launching on 20 December of a Free Trade Area agreement
between South Korea and China marked a new stage in bilateral diploma-
cy under the presidencies of Park Geun-hye and Xi Jinping. They met in
Beijing in September, for the sixth time since their taking office, on the
occasion of China’s V-day celebrations, which included the seventieth anni-
versary of both the victory of the Chinese People’s War of Resistance Against
Japanese Aggression and the victory in the World Anti-Fascist War.
Predictably, Park’s presence in Beijing was seen by many commenta-
tors as a major geopolitical shift in the region and stimulated speculations
about an increasing South Korean alignment with China and a consequent
loosening of its ties with the US. In fact, the South Korean President was the
sole US ally present at the celebration, while all other leaders of the most-
developed nations’ declined the invitation to attend, sending only low-level
delegations. On the top of it, this happened at a time when China was per-
ceived as becoming increasingly more assertive and the US increasingly more
determined in containing its rise. However, even if Park’s presence could be
seen as a real test of the strategic cooperative partnership between the China
and South Korea, such speculations were misplaced for several reasons. The
most important was the fact that Seoul continued to consider both the US and
the People Republic of China (PRC) vital for its interests – the former security-
wise, the second economy-wise – and was thus quite «natural for Seoul to try to
derive the maximum benefit from relations with both countries».50
Actually, since the beginning of the year, some of the critical aspects
characterising the South Korean-Chinese relationship came to the surface,
50. ‘South Korea Again Caught Between U.S., China’, The Diplomat, 20 March
2015.
72
Korea 2015
with special reference to Seoul’s effort to strike a balance between its com-
peting relationships with Beijing and Washington. In particular, the South
Korean government was confronted by the necessity to take tough decisions,
which could have important consequences on its relations with both the
United States and PRC.51 The first (which remained undefined in the year
under review) had to do with the deployment in South Korea of the US-ba-
cked Terminal High Altitude Area Defense missile system (THAAD), aimed
at facing possible military threats from North Korea. A decision favouring
the deployment would understandably raise China’s concern. In fact, Bei-
jing was afraid that THAAD, by subverting the existing military balance in
the peninsula, might threaten regional security. The second decision con-
cerned the ROK’s (Republic of Korea) decision to join the China-led Asian
Infrastructure Investment Bank (AIIB). Here the problem was that the US
had encouraged its allies not to join it, due to concerns over China’s rising
power on the world stage. However, first London and then Berlin, Paris and
Rome had not heeded Washington’s desires, and had joined the AIIB.52
Only one year before, when Xi Jinping had first asked South Korea to join
the AIIB, Washington had urged Seoul not to accept, and Seoul had com-
plied with the US wish.53 However, one year later – as a consequence of the
decisions taken by the US European allies – things had changed. Resigning
itself to the inevitable, on 17 March Washington gave South Korea the green
light, announcing that it was up to Seoul to decide what to do. On 26 March
Seoul communicated its intention to join the AIIB.54
On 3 September, when the PRC commemorated the end of the WWII
with an extravagant military parade in Tiananmen Square, all eyes were un-
derstandably pointed at the foreign dignitaries who had accepted Beijing’s
invitation. Among them, as noted above, there was Park Geun-hye sitting
in a front row seat, closed to Vladimir Putin and Xi Jinping. According to
Yoon Sukjoon, of the Korea Institute for Maritime Strategy, 55 by her choice
to attend the event, Park Geun-hye was demonstrating that a collaborative
strategy through skilful diplomacy was the best for peace and security in
East Asia; at the same time, she was also showing her strategic leverage,
taking advantage of South Korea’s strategic partnership with China without
undermining the security alliance with the US.56
51. Ibid.
52. ‘America’s AIIB Disaster: Are There Lessons to be Learned?’, The Diplomat,
18 March 2015.
53. ‘South Korea Torn Between US and China’, The Diplomat, 20 march 2015.
54. ‘South Korea Joins the AIIB’, The Diplomat, 28 march 2015.
55. Andrei Lankov, ‘If China had to choose, it would be South Korea’, Aljazeera,
2 September 2015.
56. Yoon Sukjoon, ‘China’s WW2 Victory Parade: Why Park Is Attending’, RSIS
Commentary, 28 August 2015 (https://www.rsis.edu.sg/wp-content/uploads/2015/08/
CO15185.pdf). According to Victor Cha , the real significant of Park’s presence in
Beijing was in fact that she was bringing China closer to Seoul while further distanc-
73
Analysing the reasons and the implications of Park’s presence in Bei-

jing, Lee Ki-hyun, of the Korea Institute for National Unification, argues
that its real significance was to be found in the «change of stature in the
ROK-China relations revealed in the process».57 Indeed, the South Korean
President was received by Beijing as the most important guest throughout
the entirety of the visit – from the protocol accorded at the V-Day celebra-
tions, to the exclusive luncheon after the bilateral summit, and the conse-
cutive talks with Premier Li Kejiang.58 This suggested that South Korea’s
strategic value for China had increased significantly. In this sense, the Bei-
jing summit played a key role in upgrading the two countries political ties,
paving the way for the launch of the ROK-China Free Trade Area in Decem-
ber, which marked a new stage in bilateral diplomacy under Park and Xi.
The deal had clear advantages for South Korea, as its government
projections showed the benefits for the country’s economy in term of real
GDP growth, job growth, and the growth of bilateral trade.59 Significantly
the South Korea National Assembly ratified the China-ROK deal on 30 No-
vember, only 5 months after its signing.60 This can be compared with the
fact that the free trade agreement between South Korea and the US (KO-
RUS FTA) was ratified exactly 4 years after its initial signing, in the midst of
heated parliamentary debates and violent mass protests.61
Finally, it must be noted that the Beijing summit served as a catalyst to
the normalization of relations in Northeast Asia, as it was in this occasion
that Park proposed to China to hold a ROK-China-Japan trilateral summit
«between late October and early November» in Seoul.62
Generally speaking, Park Geun-hye’s «China policy» was judged positi-
vely both in China and South Korea. On the one hand, South Korean public
media agreed to consider the public support for Park’s visit to China the
ing it from Pyongyang, as it was evident in Seoul’s casual reference to the peninsula
unification (within its statement on Park’s meeting in China), and that Beijing sup-
ported. It was the first time that Beijing had ever mentioned unification in a state-
ment with Seoul. Victor Cha, ‘A Pass Less Chosun’, Foreign Affairs, 8 October 2015.
57. Lee Ky-hyun, ‘The Significance of September 2 ROK-China Summit and
Prospective Tasks’, KINU Online Series, CO 15-23, 10 September 2015.
58. ‘China snubs North Korea in favour of South at Beijing event’, The Tele-
graph, 4 September 2015.
59. ‘China, South Korea to deepen economic ties with FTA implementation’,
Daily Times, 21 December 2015.
60. ‘China Headlines: China, ROK sign free trade agreement’, Xinhua News
Agency, 1 June 2015.
61. Scott Snyder & See-won Byun, ‘China-Korea relations. A complex China-
ROK Partnership’, Comparative connections, Vol. 17, N. 3, January 2016, pp. 101-112,
esp. p. 106. On the rough process which brought to the KORUS FTA ratification, see
Barbara Onnis, ‘Penisola coreana, la quiete dopo la tempesta. Aspettando il 2012’,
Asia Maior 2011, pp. 321-347, in part. pp. 340-41.
62. The significance of the trilateral summit will be discussed in the next para-
graph.
74
Korea 2015
key factor for the spike in her domestic approval rate in early September.63
On the other hand, Chinese media organizations selected Park Geun-hye
among the top ten people of the year, citing in particular her balancing role
between major powers and her attendance at Beijing V-Day (on the list there
were also Vladimir Putin, Angela Merkel and Myanmar’s democratic symbol
Aung San Suu Kyi).64
4.2. The «long-awaited» rapprochement between Seoul and Tokyo

2015 was a relevant year in South Korean-Japanese relations since it
marked not only the seventieth anniversary of the end of WWII (and thus
the end of Japanese colonial rule in the Korean Peninsula), but also the
fiftieth anniversary of the establishment of diplomatic ties between Seoul
and Tokyo (formalized on 22 June 1965).
As already seen in the previous volumes of «Asia Maior», the ties betwe-
en the two countries had been frosty in recent years, beginning with Park
Geun-hye and Abe Shinzo’s taking office. Since ten, historical divisions and
territorial disputes came (once again) to the fore, creating an increasingly
strong barrier between the two neighbours and the US’s two most impor-
tant Asian allies. Actually, the frosty bilateral ties had started to thaw sin-
ce the end of 2014, when the two countries signed an important trilateral
agreement with Washington for the sharing of military and other sensitive
information concerning the North Korean nuclear and ballistic program.65
That is why at the end of 2014 there was cautious optimism about a further
improvement in the bilateral ties in 2015, also in view of the aforementio-
ned anniversaries.
Confirming such optimism, the first months of 2015 saw some important
positive, starting with the resumption of talks among the foreign ministers of
South Korea, Japan (and PRC), for the first time in nearly three years. They
met in March, at the Seventh Trilateral Foreign Ministers’ Meeting in Seoul,
in a bid to restore cooperation between the three Asian economic powers.66
Much more relevant, however, was the anniversary of normalization
of relations on 22 June, which brought South Korean Foreign Minister Yun
Byung-se, for the first time since he took office in 2013, to Tokyo for a com-
63. Scott Snyder & See-won Byun, ‘China-Korea relations. A complex China-
Rok Partnership’, p. 102. ‘How is Park Geun Hye’s attendance in the WWII victory
parade in China viewed in Korea?’, (https://www.quora.com/How-is-Park-Geun-Hyes-
attendance-in-the-WWII-victory-parade-in-China-viewed-in-Korea).
64. ‘Park chosen as one of 10 people of the year by Chinese media’, Yonhap News
Agency, 28 December 2015.
66. ‘South Korea, Japan, China to meet on three-way cooperation’, Reuters, 17
March 2015.
75
memoration banquet.67 On its part, Seoul hosted an international acade-

mic conference from 17 to 19 June dedicated to the topic «beyond the past
and into the future of the South Korea-Japan relations».68 Park and Abe,
while attending separate celebrations – Park at a reception at the Japanese
embassy in Seoul, and Abe at the South Korean embassy in Tokyo – spoke
optimistically about the future of Japanese-South Korean bilateral relations,
although showing their awareness that this improvement would not happen
overnight. A South Korean official’s words to South Korean’s Yonhap News
Agency - «Spring has come to South Korea-Japan relations, though the ice
of the river has not melted yet» - reflected well the difficulties still facing
the two countries.69 Nonetheless, according to some experts, the diplomatic
functions to commemorate the fiftieth anniversary of the establishment of
diplomatic ties between Seoul and Tokyo could be seen as a turning point
for the improvement of bilateral ties, while the trend to mend fences appe-
ared to have become irreversible.70
On the contrary, the general mood during the celebrations of the se-
ventieth anniversary of the end of World War II (which marked Korea’s in-
dependence from Japanese colonial rule) was decidedly disappointing for
Seoul. In his statement, when referring to Japanese war crimes, the Japane-
se Premier mentioned «deep remorse» and generically expressed «heartfelt
apology» without actually issuing a direct apology himself.71 Predictably,
Abe’s speech did not meet Seoul’s expectations,72 and South Korea’s media
reaction was largely negative. In particular, the Chosun Ilbo daily criticized
the Japanese Prime Minister for not apologizing directly for Japanese ag-
gression and colonial rule, while the Yonhap News Agency defined the state-
ment as a major step backward from those made by two of his predecessors
(referring to Murayama Tomiichi and Koizumi Junichiro).73 Nonetheless,
67. ‘South Korea’s Foreign Minister to Make First Trip to Japan’, The Diplomat,
18 June 2015.
68. Ministry of Foreign Affairs, Spokesperson’s Press Briefing, 16 June, 2015,
(http://www.mofa.go.kr/ENG/press/pressbriefings/index.jsp?menu=m_10_30).
69. ‘South Korea-Japan Relations: Toward a «New Future»?’, The Diplomat, 23
June 2015.
70. Ibid.
71. ‘The Abe Statement: A Korean Perspective’, The Diplomat, 25 August 2015.
Interestingly, following Abe’s speech, South Korean’s Joongang Daily reported the re-
sults of a survey of U.S. scholars and historians regarding the stalemate in relations
between the two countries, which saw 90% blaming the Japanese government (and 10%
the South Korean leadership), while 60% thought South Korea was most responsible
for blocking a face-to-face meeting between the two leaders. According to U.S. com-
mentators, Seoul was blameworthy for what they called an «apology fatigue», referring
to the fact that South Korea used every 15 August as an excuse to rebuke Japan for its
history, and more generally for its continuous insistence on a direct apology for Japan
war crimes. Ibid.
72. ‘Abe statement fails sincerity test’, The Korea Times, 14 August 2015.
73. ‘Abe seeks to reset East Asian Relations’, Nikkei Asian Review, 20 August 2015.
76
Korea 2015
while inviting Tokyo to let «sincere actions» follow Abe’s words, Park Geun-
hye declared that, despite all the difficulties, the two countries had to «move
forward to a new future».74
It was in this spirit that the two sides met for a bilateral summit in
Seoul, at the beginning of November, on the side-lines of the trilateral
summit among the PRC, Japan and South Korea. The meeting took place
amid heightened tensions in the Asia-Pacific region, following the provo-
cative decision by the US navy to send a destroyer within the 12 nautical
mile territorial limit surrounding Chinese-claimed territory in the South
China Sea (where China had built artificial islands).75 It is no coincidence
that analysts and commentators agreed to consider the trilateral summit
largely symbolic, «an achievement in itself», considering that none of the
issues that had initially disrupted the annual summits had been resolved.76
Not to mention, the fact that the historical issues that had contributed to
disrupt the trilateral summits after 2012 were barely mentioned in the
declaration.
The joint statement released at the end of the trilateral summit («Joint
Declaration for Peace in East Asia») focused on closer collaboration, both
in terms of the economy and regional security, while the only reference to
history saw all three sides agreeing to carry out further cooperation «in the
spirit of facing history squarely and advancing towards the future».77
As far as the bilateral summit was concerned, the overwhelming majo-
rity of observers agreed to reduce its importance - as had been the case with
the trilateral summit - to a symbolic level, while considering it quite disap-
pointing in terms of substance,78 because it had failed to yield anything
tangible beyond the appearance of improving relations between the two
sides. Nonetheless, as for the abovementioned trilateral summit, the fact
that the meeting had taken place after a long hiatus was seen as more im-
74. ‘South Korea president says Abe WWII speech fell short’, Channel News Asia,
15 August 2015 (http://www.channelnewsasia.com/news/asiapacific/south-korea-presi-
dent/2052080.html).
75. ‘Leaders of Japan, China and South Korea meet in Seoul’, World Socialist Web
Site, 2 November 2015.
76. Sarah Teo, ‘China-Japan-Korea Trilateral Summit: What does it mean for
East Asia?’, RSIS Commentary, n. 234, 4 November 2015 (https://www.rsis.edu.sg/
wp-content/uploads/2015/11/CO15234.pdf).
77. ‘Full text of joint declaration of trilateral summit’, Yonhap News Agency, 1
November 2015.
78. According to David Kang and Jiun Bang the timing was probably not op-
timal, considering that South Koreans were fiercely debating the history textbooks
question (which had obvious connections with Japan). Moreover, and possibly more
relevant was the fact that there was the unconfirmed news of a joint South Korean-Chi-
nese move to have «comfort women/sex slaves» documents registered with UNESCO’s
Memory of the World Register. See David Kang & Jiun Bang, ‘Japan-Korea Relations.
The Art of Politics and the Politics of Art’, Comparative connections, Vol. 17, N. 1, May
2015, pp. 113-122, esp. pp. 129-30, (http://csis.org/files/publication/1501q.pdf.).
77
portant than its content, raising hopes for the beginning of a «new cycle of
good relations between the countries».79 Nonetheless, according to Scott
Snyder, the «cold summit» result, with no joint press conference, no joint
statement, and no Park-hosted lunch for the Japanese Prime Minister (as
she had done for the Chinese Premier Li Kejiang), clearly reflected the on-
going political gap between the two countries, despite the re-establishment
of normalized communication channels in every area of the relationship.80
As expected, the «comfort women» issue dominated Park and Abe’s
100-minute long conversation.81 The two sides expressed the commitment
to «accelerate talks to reach an agreement as soon as possible» in order to
resolve it once for all, but they did not offer details of how such a result
might be achieved. Actually, Park Geun-hye had already indicated her pre-
ferred timeline for the on-going negotiations, when, in a written response
to questions presented by two Japanese media organizations, had stated:
«I truly hope that this issue can be resolved within this year/hopefully to be
settled by the end of the year».82 The new positive approach by both leaders
(particularly by the South Korean President) was also evident in their per-
sonal attitude. In a commemorative photo session prior to the talks, Park
Geun-hye smiled as she shook hands with Abe.83
The more relaxed atmosphere that emerged from the summit was
quickly disturbed by some frictions,84 but, thanks to the will of both leaders,
neither Seoul nor Tokyo let any single issue damage the bilateral relation’s
new spirit.85
In fact, 2015 ended with a bang. On 28 December, the two countries
signed a historic deal which was supposed to put an «end» to the long-stan-
ding issue concerning the «comfort women/sex slaves».86 Under the accord,
79. ‘Japan and South Korea summit signal thaw in relations’, The Guardian, 2
November 2015.
80. ‘Assessing the First Park-Abe Summit’, Council on Foreign Relations, 4 No-
vember 2015.
81. “«Comfort Women» Issue Dominates Rare Japan-Korea Bilateral Talks’, The
Diplomat, 3 November 2015.
82. ‘Park: Fixing ‘comfort women’ issue this year key to positive future’, The
Asahi Shimbun, 30 October 2015.
83. ‘Japan, S. Korea to continue talks on «comfort women»’, The Japan News, 2
November 2015 (http://www.asianews.network/content/japan-s-korea-continue-talks-
%E2%80%98comfort-women%E2%80%99-2993?qt-most_downloaded=0).
84. Among others the lawsuit of the Sankei Shimbun’s former Seoul bureau
chief, Kato Tastuya, for allegedly defaming the South Korean President in 2014 in the
aftermath of the Sewol incident. For more details on the issue, see Marco Milani & Bar-
bara Onnis, ‘Penisola coreana 2014: «ombre» all’interno e «luci» all’esterno’, p. 123.
85. David Kang & Jiun Bang, ‘Japan-Korea relations. A Litigious Time of the
Year’, p. 127.
86. It was not the first time that Japan and South Korea agreed to try to put
the issue behind once and for all. From Japan’s perspective, the dispute had already
been resolved in 1965, when the South Korean government agreed that all issues of
78
Korea 2015
Japan agreed to supply US$ 8.3 million in government funds to support the
surviving Korean women (who totalled 46) who were sent to front-line bro-
thels for Japanese troops before and during World War II. Japanese Prime
Minister Abe Shinzo apologized for the women’s treatment, something he
had been previously reluctant to do, through a statement by his Foreign Mi-
nister and a telephone call to South Korean President Park Geun-hye.87 In
return, South Korea promised to «finally and irreversibly» end the dispute
and try to secure the removal of a comfort women statue in front of Japan’s
Embassy in Seoul. Both nations also agreed to mutually refrain from fur-
ther public criticism related to this issue.88
However, despite immediate praise from the US, the public opinions
on both sides, but especially in South Korea, were not happy about this
denouement.89 The «Korean Council for Women Forced Into Sexual Sla-
very», which represents a group of former sex slaves, considered the agre-
ement inadequate, as it did not make clear enough that the recruitment of
the women «was a crime done by the Japanese government and military
systematically».90 Also, it criticized the Japanese government’s decision to
create a fund instead of directly compensating the surviving victims.91 Ac-
cordingly, while marking a significant step, only the future will show the real
impact of the agreement on Japan-South Korean relations.
4.3. The «missed debut» of Kim Jong Un on the international scene

2015 can be considered the year of the «missed debut» of Kim Jong Un
on the international stage.
At the end of January, Yonhap News, the South Korean News Agency,
reported that the North Korean leader might be attending the sixtieth anni-
versary ceremony of the Asian-African Conference (known as the Bandung
Conference) in Indonesia on 24 April, marking his first official internatio-
nal visit since succeeding his father, Kim Jong Il, in 2011.92 For Kim Jong
Un, it would have been a «noteworthy diplomatic schedule», following his
compensation would be settled government-to-government, and again in 1994, when

the Asian Women’s Fund was set up with government assistance to solicit funds for
former comfort women on humanitarian grounds; while in moral terms Tokyo stood
by a 1993 government apology, the so called «Kono statement», which acknowledged
the Japanese military’s involvement in the operation of the front-line brothel system.
87. ‘Japan, South Korea Agree to Aid for «Comfort Women»’, The Wall Street
Journal, 28 December 2015.
88. ‘The Comfort Women Agreement: A Win for Traditional Diplomacy’, The
Diplomat, 31 December 2015.
89. ‘Regret on Park-Abe deal’, The Korea Times, 29 December 2015; ‘Comfort
women deal backfires for Park’, The Korea Times, 30 December 2015.
90. ‘Japan, South Korea Agree to Aid for «Comfort Women».
91. Ibid.
92. ‘N. Korean leader may join Bandung Conference in April: source’, Yonhap
News Agency, 25 January 2015.
79
grandfather’s legacy, who had joined the Conference during its tenth an-
niversary in April 1965.93 However, a brief announcement made by North
Korean news agency KCNA, a few days before the beginning of the Confe-
rence, put an end to the speculations triggered by Yonhap News: «A DPRK
[Democratic People’s Republic of Korea] delegation led by Kim Yong Nam,
President of the Presidium of the Supreme People’s Assembly – stated
KCNA – left here Saturday to take part in the Afro-Asia Summit and events
marking of the sixtieth anniversary of the Afro-Asia Conference».94
After the missed opportunity in Indonesia, Kim’s first foreign visit see-
med set to be at the Victory Day celebrations in Moscow on 9 May, following
the declaration in January by Russian Foreign Minister Sergey Lavrov to re-
porters that the North Korean leader had accepted the invitation to attend
the ceremony.95 Moreover, repeated statements from Russian officials gave
the impression that Kim’s attendance was to be considered a fait accompli,
also implying that a bilateral summit between Kim and Russian President
Vladimir Putin was in the cards.96
Moscow had already invited Kim Jong Un at the end of 2014, in a
move to crown a particularly good year in the relations between the two
countries, both ostracized by the international community.97 For Kim Jong
Un, such an occasion would have contributed to further strengthen its rela-
tionship with Moscow, allowing his country to rebalance away from econo-
mic over-reliance on Beijing. Indeed, as already seen in the previous volu-
mes of «Asia Maior», in the last few years, Pyongyang, while relations with
the PRC soured and talks with Tokyo went through highs and lows, had
increasingly relied on Russia as its last diplomatic ally. Furthermore, there
was the possibility of using Moscow as the site for an inter-Korean summit,
in consideration of the fact that the South Korean President had received
the same invitation.
At the beginning of May, however, only a few days before the «big
event», KCNA announced that the North Korean head of Parliament and
nominal head of state, Kim Yong Nam, would attend the Russian Victory
Day celebrations, without mentioning the reasons why Kim Jong Un had
cancelled his trip to Moscow.98 Kremlin spokesman Dmitry Peskov’s stated
93. ‘Kim Jong Un to Visit Indonesia Marking First Official Trip Abroad’, Sput-
niknews.com, 25 January 2015.
94. ‘DPRK Delegation Leaves to Take Part in Afro-Asia Summit’, KCNA, 18
April 2015.
95. ‘Kim Jong-un Accepts Invite to Russia’, The Chosun Ilbo – English Edition, 22
January 2015.
96. ‘Kim Jong-un Won’t Attend Moscow Victory Celebrations’, The Chosun Ilbo –
English Edition, 1 May 2015; ‘North Korean leader Kim Jong-un won’t visit Moscow on
May 9 – Kremlin’, TASS, 30 April 2015.
97. Marco Milani & Barbara Onnis, ‘Penisola coreana 2014: «ombre» all’interno
e «luci» all’esterno’, pp. 129-31.
98. ‘Kim Yong Nam to Visit Russia’, KCNA, 4 May 2015. .
80
Korea 2015
that Kim’s last-minute change had to do with unspecified «internal mat-

ters». While this was, in all likelihood, just a face-saving excuse, the hint to
«internal matters» provoked widespread speculation, «with theories ranging
from domestic instability to Russia’s refusal to come up with an arms deal
incentive».99 Other theories focused on the difficulty (and failure) to reach
an agreement on security protocol for Kim while in Moscow. Actually, Russia
reportedly refused to comply with North Korea’s request to give its leader a
special treatment, given that there would be several other foreign dignitari-
es participating in the event.
In Moscow’s view, protocol arrangements would have been further
complicated because, nominally, Kim was not a head of state.100 Another
supposed reason was that the North Korean leader was worried that rela-
tions with China could worsen, since, according to professor Kim Yong-hyun
of Dongguk University: «It would have been very awkward for Kim to meet
Chinese President Xi Jinping face-to-face in Moscow for the first time».101
Much-discussed was also the possibility that Kim Jong Un’s was determined
by the news, released two weeks before, that his South Korean counterpart
would not go either.102 All said, according to Andrei Lankov, the cancella-
tion of Kim Jong Un’s trip to Moscow was «hardly a surprising announce-
ment», since most observers had been rather sceptical about the chance that
the North Korean leader would go to Moscow in his first-ever foreign trip.
Lankov reflected instead on the reasons «why did North Koreans create the
impression that Kim Jong-un’s visit was all but decided». For Lankov, it was
quite possible that the North Korean leader had for a while been undeci-
ded about going or not. On the one hand, he needed Russia as a balancer
against China; however, on the other had, «he may have quickly realized
that he would have been facing not just any summit but a super-summit,
and obviously succumbed to his worries and phobias».103 In any case, the
Moscow event would not have been the best place, not to mention the best
time, for Kim Jong Un’s diplomatic debut, because it was going to be a lar-
ge and noisy gathering, with «hordes of journalists swarming ready to spot
and report a single slip or mistake». If Kim wanted to talk with the Russian
President, reflected Lankov, a separate visit would be a much better idea.104
Beyond these two lost occasions, there was another chance for Kim
Jong Un’s international debut, probably the most important one. In fact,
99. ‘North Korean’s head of Parliament to replace leader Kim Jong Un for Mos-
cow visit’, Straits Times, 4 May 2015.
100. ‘Kim Jong-un Won’t Attend Moscow Victory Celebrations’, The Chosun Ilbo
– English Edition, 1 May 2015.
101. Ibid.
102. ‘Park won’t attend Russia event’, The Korea Times, 12 April 2015.
103. Andrei Lankov, ‘Foibles and fears: Why Kim Jong Un cancelled his Russia
visit’, NK News, 1 May 2015.
104. Ibid.
81
in the meantime, the North Korean leader had also received China’s in-
vitation to take part in its Victory Day Parade in September.105 In a press
briefing released on 14 April, China’s Foreign Ministry spokesperson Hong
Lei announced that Beijing had «sent invitations to leaders of all relevant
countries» to the ceremony commemorating the seventieth anniversary (3
September) of the Victory in the War of Resistance against Japan. Yonhap
News Agency, quoting unnamed diplomatic sources, said that North Korea’s
leader would be among those.106
It was the first time Kim Jong Un had been invited to China, probably
in a move to improve the recent troubled state of Sino-North Korean rela-
tions, but also because, according to Kim Heung-kyu, director of the Chi-
na Policy Institute at Ajou University: «It would be quite embarrassing for
China and its (President) Xi Jinping to meet Kim Jong Un in Moscow when
North Korea hasn’t solved its issues with China yet».107 Quite unsurprisingly,
Kim Jong Un declined the invitation from Beijing, confirming the strained
political ties between the allies over Pyongyang’s defiant pursuit of nuclear
weapons and wayward behaviour.108 Again speculations on Pyongyang’s de-
cision went from domestic considerations to reasons more strictly related to
the bilateral relationship. For John Delury, of the Yonsei University in Seoul,
Kim Jong Un possibly renounced to go to China either because he did not
feel secure leaving his country or simply because he was not interested in a
close relationship with Beijing.109 However, according to the 1 September
edition of KGS NightWatch the reason was a completely different one. In
fact, the North Korean government insisted on its «Supreme leader» recei-
ving the highest honours as a guest, and being placed on Xi’s right hand
side. So, when informed by Beijing that he would be placed at the end of
the reviewing stand, the North Korean leader decided to cancel the visit.110
Nonetheless, in a significant move, Kim decided to send Choe Ryong
Hae, part of his inner circle, instead of the ceremonial head of state, Kim
Yong Nam. Much has been said on Choe’s treatment by the Chinese, star-
ting from the fact that he was seated far away from the centre, together with
other undistinguished foreign dignitaries, while the South Korean President
sat near Xi Jinping himself. However, as noted by a Chinese commentator,
Choe did not hold an official government position, since his official title
was «secretary of the Korean Worker’s Party»; thus, according to the proto-
105. ‘China Invites Kim Jong-un to Victory Day Parade’, The Chosun Ilbo – Eng-
lish Edition, 15 April 2015.
106. ‘China invites Kim Jong Un to its own Victory Day’, NK News, 15 April
2015.
107. Ibid.
108. ‘Kim Jong-un snubs China’s invitation to military parade’: source’, The Yon-
hap News Agency, 24 August 2015.
109. ‘Kim Jong-un Bows Out’, The New York Times, 2 September 2015.
110. Quoted in ‘North Korea’s Growing Isolation’, The Diplomat, 5 September
2015.
82
Korea 2015
col, with so many head of states and prime ministers attending the parade,
the fact that he was seated behind the higher-ranking officials from other
countries was natural enough.111 However, Choe Ryong Hae was refused
even a brief meeting with the Chinese President, while, as already noted,
Park Geun-hye was received with all the honours. All this appeared to con-
firm the deteriorating trend in North Korean-Chinese relationship – which
had become a constant during the Kim Jong Un-Xi Jinping era.112
After turning a cold shoulder to his two closest historical allies, spe-
culation that the North Korean leader did not want to share the stage with
other world leaders seemed to be clearly confirmed. In any case, Kim had
missed out on important opportunities for his country, since he did not
seem to care about its foreign relations, and at the end of the year – with the
exception of the the relationship with Russia (on which more below) – North
Korea was as isolated as ever, in sharp contrast to the diplomatic activism
which had characterized 2014.113
4.4. The «friendship year» between Pyongyang and Moscow

Following the excellent trend which defined North Korea-Russia ties in
2014, in the year under review the bilateral relation continued to be good,
even after the cancellation of Kim’s trip to Moscow. Actually, since the be-
ginning of the year there were clear indications confirming that North Ko-
rea considered its relation with Russia as ranking above all others, the one
with China included. On 2 January, when announcing, in order of their im-
portance, the list of foreign leaders who had sent New Year’s greeting cards
to Kim Jong Un, the North Korean state TV mentioned Vladimir Putin
before Xi Jinping. This was in contrast with what had been done in previous
years, when the Chinese President had always been mentioned first.114 In
the same spirit, in the middle of February, the Russian news agency ITAR-
TASS reported a declaration by the Russian Ambassador in Pyongyang,
Alexander Matsegora, according to which the Russian President and the
North Korean leader exchanged regular messages in order to keep in touch
and coordinate their policies.115
111. ‘How will China and the US Address the North Korean Puzzle?’, The Dip-
lomat, 23 September 2015.
112. Such a trend was barely reversed after Liu Yunshan’s arrival in Pyongyang
to join the celebrations of the seventieth anniversary of the foundation of the Korean
Workers’ Party. See par. 4.5.
113. ‘North Korea Doesn’t Seem to Care About its International Relations’,
Radio Free Asia, 11 August 2015; ‘North Korea’s Growing Isolation’, The Diplomat, 5
September 2015.
114. ‘N. Korean Media Favors Russia Over China’, The Chosun Ilbo – English
Edition, 2 January 2015.
115. ‘Kim Jong-un, Putin «Swap Regular Messages», The Chosun Ilbo – English
Edition, 16 February 2015.
83
On 11 March, then, the two countries declared 2015 a «year of friend-

ship» that was to be marked by a series of political, economic and cultural
exchanges.116 In reality, the declaration had been preceded in late February
2015 – during a visit by a North Korean economic delegation to Moscow –
by an agreement that committed the two countries to discuss the creation of
advanced development zones in the Russian Federation’s Far East.117 In the
same days, news also circulated that the Russian electricity giant TEK Mons-
energo – a subsidiary of Russia’s state-owned Gazprom, the world’s largest
extractor of natural gas – would carry out a feasibility study to bring electric-
ity to North Korea.118 Again in February, the two countries announced the
intention to conduct a series of joint army, navy, and air force exercises dur-
ing the year.119 It’s worth to note that, since the beginning, the announce-
ment appeared a move «aimed at proving that Moscow isn’t isolated on the
world stage», whereas the fact that the two countries could actually conduct
joint drills appeared doubtful to most analysts.120
Under those circumstances, the launching of a friendship year was
more than understandable. The declaration was in fact the latest indi-
cation of the ever-growing relationship between two countries that were
both target of international ostracism. Generally speaking, the increasing
closeness between the two countries appeared to be an attempt to balance
the pressure placed on them by the West. In particular, their decision to
strengthen their ties seemed to be a direct message to the US and other
Western governments, signalling their ability to expand their influence in
geographically distant areas, should the West seek to isolate them through
sanctions.121
116. ‘Russia and North Korea declare 2015 a «year of friendship»’, The Tele-
graph, 11 March 2015. For a general overview of Moscow’s interest in deepening its
relationship with Pyongyang, in a historical perspective, see R. Weitz, ‘Russian Policy
toward North Korea: Steadfast and Changing’, International Journal of Korean Unifica-
tion Studies, vol. 24, n. 3, 2015, pp. 1-29.
117. ‘Russia, North Korea Boost Economic Ties’, VoaNews, 22 March 2015.
118. ‘Gazprom subsidiary to carry out feasibility study on exporting electricity
to DPRK’, NK News, 12 March 2015.
119. ‘Russia to conduct joint military drill with North’, NK News, 2 February
2016.
120. Zachary Keck, ‘Russia to Hold Joint Military Drills with North Korea,
Cuba’, The National Interest, 3 February 2015. However, according to Cho Han-bum of
the Korea Institute for National Unification, such an event was not to be excluded at
all, considering that Russia and North Korea had common interests in that Moscow
wanted to resist US pressure and Pyongyang opposed the joint South Korea-US exer-
cises. See ‘Russia Plans Joint Military Drills with N. Korea’, The Chosun Ilbo – English
Edition, 2 February 2015.
121. Yousra Neberai, ‘My Enemy’s Enemy: Analyzing Russia and North Ko-
rea «Year of Friendship»’, Harvard International Review, Vol. 36, N. 4, Summer 2015
(http://hir.harvard.edu/my-enemys-enemy-analyzing-russia-and-north-koreas-year-
of-friendship).
84
Korea 2015
Nonetheless, the two countries’ friendship was not going to be uncon-

ditional. Speaking at a forum marking the twenty-fifth anniversary of the
establishment of diplomatic relations between Seoul and Moscow, top Rus-
sian envoy in South Korea, Alexander Timonin, said that his country would
«never justify North Korea’s nuclear missiles nor its nuclear program», and
that, for Moscow, there were «no other alternatives than diplomatic meas-
ures to solve the nuclear issue».122 Actually, the Kremlin had been paying
attention and monitoring the nuclear situation in North Korea ever since
Pyongyang announced plans to resume nuclear operations and launch mis-
siles in the middle of September.123 In the end, the event that might have
marked a real breakthrough in the bilateral relation did not occur, as we
have seen in the previous paragraph.
4.5. Pyongyang-Beijing. Opening a new chapter in North Korean – Chinese

relationship?
As already mentioned, Kim Jong-un’s rejection of the Chinese invita-
tion to attend the military parade marking China’s Victory Day could be
seen as emblematic of the strained political ties between the two allies, even
if the choice to send Choe Ryong Hae instead of Kim Yong Nam (as hap-
pened for Moscow) had been interpreted by some observers as «a sign that,
when it comes to China-North Korea relations, leader Kim Jong-un values
substance over style».124 The deteriorating trend in North Korean-Chinese
relationship appeared to be merely put on hold by Liu Yunshan’s arrival
in Pyongyang to join the celebrations of the seventieth anniversary of the
foundation of the Korean Workers’ Party. Being one of the seven members
of the Politburo Standing Committee, Liu – as already noted – was in fact
the first high-ranking Chinese official to visit North Korea in four years. His
presence in Pyongyang, according to John Delury, was a clear message by
Xi Jinping, marking an apparent shift away from a hard line toward North
Korea.125
Such a shift was also visible in the «warm» message sent by Xi to Kim
to congratulate him on the seventieth anniversary of the founding of the
KWP. Xi’s message contrasted notably with the «coldness» that had marked
the previous contacts between the two leaders, particularly in the case of the
reciprocal messages in 2014. «China is willing to make joint efforts with the
122. ‘Russia rejects North Korea To Be Recognized As Nuclear State’, ValueWalk,

27 September 2015 (http://www.valuewalk.com/2015/09/russia-rejects-north-korea-as-
nuclear-state).
123. Sam Kim, ‘N. Korea Resumes «Normal Operations» at Yongbyon Nuclear
Facility’, Bloomberg Business, 15 September 2015.
124. ‘How will China and the US Address the North Korean Puzzle?’,
125. Al Gale, ‘North Korea and China Tout Ties at Military Parade’, Wall Street
Journal, 10 October 2015.
85
DPRK comrades to well maintain, consolidate and develop the friendship

between China and the DPRK in the interest of the two countries and two
peoples, so as to play a positive and constructive role in maintaining regional
as well as world peace and stability» said Xi in his message, and concluded by
stating that he «sincerely wished the WPK constant development, the DPRK
prosperity, and the China-DPRK friendship passing down from generation to
generation».126 A similar tone marked the letter sent by Xi Jinping through
Liu Yunshan to Kim Jong Un. In reporting this, Chinese news agency Xinhua
stated: «Beijing attaches great importance to its traditional friendly ties with
Pyongyang, proposing that both sides go hand in hand to cherish their ‘com-
mon treasure’».127 In John Delury’s opinion, Xi’s letter marked the «Chinese
leader’s first real effort to make friends with Kim Jong Un». Delury also noted
that Xi’s letter did not mention denuclearization, in contrast with an earlier
message carried by Vice President Li Yuanchao, who, in 2013, tried to press
North Korea to slow down its nuclear program.128
North Korea watchers paid particular attention to the four-day visit by
Liu, underlining the significance on his presence on the podium together
with the North Korean leader during the military parade, highlighted by the
fact that Liu was the only foreign dignitary of any significance at the event.
North Korea’s state media reported Liu speaking frequently with Kim Jong
Un while the state television showed the images of the two watching the mi-
litary parade and waving to the crowd holding hands.129 All this appeared to
point out that the two countries were going to open a new chapter in their
strained relationship. Indeed, in a possible sign of Pyongyang’s concession to
Beijing, Kim Jong Un refrained from making threats about the use of nuclear
weapons in his rare public speech (the first in three years).130 Nor did the
event include any firing of missiles, with a probably sigh of relief of Beijing, in
spite of the fact that Liu’s visit to Pyongyang had been accompanied by spe-
culations that North Korea would launch a long-range rocket to celebrate the
anniversary, as Pyongyang had done in previous similar occasions.131
Following signs that bilateral relations had thawed after a deep chill, in
the aftermath of Liu Yunshan’s successful mission to North Korea there was a
126. ‘Xi congratulates Kim Jong Un on founding anniversary of Workers’ Party

of Korea’, Xinhua, 9 October 2015.
127. ‘Visiting Chinese official tells North Korea’s Kim that Beijing can help
revive nuclear talks’, The Japan Times, 10 October 2015.
128. ‘At Military Parade, a Rare Public Speech by North Korea’ Leader’, The
New York Times, 10 October 2015.
129. ‘Holding hands with top Chinese official, North Korea’s leader Kim Jong-
un tells the world that Beijing stands by his side’, South China Morning Post, 11 Octo-
ber 2015.
130. ‘At Military Parade, a Rare Public Speech by North Korea’ Leader’, The
131. ‘Visiting Chinese official tells North Korea’s Kim that Beijing can help
revive nuclear talks’.
86
Korea 2015
growing sentiment that Kim Jong Un might go to Beijing «in November or

in Spring next year at the latest, given that Xi hinted at inviting the North
Korean leader in his message last week».132 According to Kim Yong-hyun, a
professor of North Korean studies at Dongguk University, and An Chan-il,
head of the World Institute for North Korea Studies, «it is expected that the
North Korean leader will visit Beijing within a month in response to Xi’s offer
[...] If that’s not the case, he may go there before next April when things will
start to get busy in North Korea» in order to celebrate the 104th birthday of
North Korea’s late founder Kim Il Sung.133 In the end, November passed and
nothing happened; it remains a possibility that such an event could happen
in April 2017. However, this possibility appeared to vanish after Kim Jong
Un’s announcement to the state media, at the beginning of December, that
North Korea was «ready to detonate [a] self-reliant A-bomb and H-bomb to
reliably defend its sovereignty and the dignity of the nation». Interestingly,
the announcement was made in exactly the same moment when a top Unit-
ed Nations human rights official was telling a Security Council meeting that
it was «essential» that Pyongyang be referred to the International Criminal
Court for its human rights abuses. 134 The abrupt cancellation of performanc-
es by the North Korea’s visiting Moranbong band in Beijing on 10 Decem-
ber135 was just the last indication of the unresolved tensions between China
and North Korea relative to the latter nuclear ambitions.
4.6. The Pyongyang- Tokyo deadlock on the abduction issue

After the largely cooperative attitude shown in 2014 by North Korea
towards Japan on the abduction issue,136 which had led to the resumption
of the dialogue and the achievement of an important agreement in Stock-
holm at the end of May, the Japan-North Korea relations deteriorated
again for two different reasons. The first was the missed delivery of the
first report on the issue, by a special commission set up by Pyongyang.
The second was the fact that Japan co-sponsored the condemnation of
132. ‘NK leader may visit China for summit talks’, The Korea Times, 13 October
2015.
133. Ibid.
134. ‘North Korea claims it has H-bomb as U.N. discusses human rights abuses’,
CNN News, 12 December 2015.
135. ‘Kim band gone: North Korean leader’s girl group cancels Beijing gigs’,
The Guardian, 13 December 2015; ‘Mystery Cloaks a North Korean Pop Band’s Can-
celed Beijing Dates’, The New York Times, 21 December 2015.
136. The abduction issue concerns the fate of those Japanese citizens abducted
in Japan by secret agents of the North Korean government in the 1970s and 1980s.
The existence of such a program was admitted for the first time by Pyongyang in
2002 on the occasion of the historic visit of Japanese Prime Minister Abe Shinzō in
North Korea. Since then, the solution of the problem has represented the sine qua
non for the improvement of the bilateral relationship. See Marco Milani & Barbara
Onnis, ‘Penisola coreana 2014: «ombre» all’interno e «luci» all’esterno’, pp. 131-4.
87
North Korea by the UN General Assembly on the issue of the violation of

human rights.
In the year under review, North Korea-Japan relations were at a stand-
still, as Tokyo waited, in vain, for an initial report on the abduction issue,
and North Korea advanced the request that Japan apologized and paid rep-
arations for its colonial crimes before negotiations could move forward. In
March, after Tokyo police raided the properties of members of the General
Association of Korean Residents in Japan (Chongryon), as part of an inves-
tigation into the smuggling of North Korean pine mushrooms, Pyongyang
made use of the case to render its position more inflexible. Indeed it condi-
tioned the continuation of the negotiation on the abduction affair to Toyo
making public the proofs of the involvement of the Chongryon representa-
tives in the smuggling.137
During the informal talks held in March, Tokyo indicated that it
would re-impose the sanctions that had been suspended following the
signing of the Stockholm agreement, if progress on the abduction issue
was not made.138 The promise was immediately honoured. On 30 March,
top Japanese government spokesman Yoshihide Suga announced that
Japan had decided to once again impose sanctions on North Korea in
response to Pyongyang’s delay in presenting the promised report on the
abduction affair. He also specified that Japan would impose a trade em-
bargo on North Korea and ban for two years North Korean ships from
entering Japanese ports, except for humanitarian reasons. In a press con-
ference, Suga added that Japan would continue to urge Pyongyang to
present its report on the abduction issue without delay, and to make the
utmost effort to return all of the abductees.139 The Chief Cabinet Secre-
tary subsequently announced a 4 July deadline (exactly one year from the
day the investigation officially began) for North Korea to turn its report
in. Nonetheless the position of the Japanese government was not univo-
cal, with some agreeing to continue dialogue with Pyongyang after that
deadline, and others willing to expand sanctions in case of non-respect
of the deadline.140
In the meantime, Japan tried to involve third parties in the issue. The
symposium hosted by Japan in New York at the beginning of May was ac-
tually part of an intensive campaign to rally international support for its
efforts to seek answers from Pyongyang on the fate of the abductees. The
137. ‘North Korea, Japan exchange protests, reaffirm positions’, NK News, 3

April 2015.
138. ‘Japan Eyes 2-Years Renewal of North Korea Sanctions’, Nikkei Asian Weekly,
28 March 2015.
139. ‘Japan extends sanctions on North Korea by two years’, Reuters, 30 March
2015.
140. ‘Little progress on North Korea abduction issue year after investigation
launched’, The Mainichi, 30 May 2015.
88
Korea 2015
requested support was found, in particular, on the part of the US.141 On

its part, at the end of March, the UN Human Rights Council had already
adopted a resolution against North Korea condemning its abduction of for-
eign nationals.142
As the deadline passed without North Korea releasing any report,
the Japanese Premier renewed his pledge to resolve the issue. Also, at a
brief meeting of the two countries’ Foreign Ministers in Kuala Lumpur,
Pyongyang was urged to be more cooperative and make some real pro-
gress. 143 On the other hand, on 20 August, The Japan Times reported
that a North Korean Foreign Ministry official, in charge of negotiations
with Japan, had informed a Japanese private-sector mission that Pyong-
yang had communicated to the Japanese government that the probe was
complete and the report ready, but Tokyo had refused to accept it. On his
part, a delegate of the same mission, quoted the North Korean official as
saying that the Japanese government worried about the emotional feel-
ings that could be aroused in the Japanese public opinion by the publica-
tion of the report.144
In the midst of reciprocal accusations, and despite perceptions that
maintaining continuity was vital in moving the bilateral talks forward, the
Japanese government decided in October to renew its team on the abduc-
tion issue. In fact, Abe was seeking a breakthrough in his dealings with
North Korea.145 The new team met secretly with its North Korean counter-
part on two occasions, in November 2015, in China. At the second meet-
ing, in mid-November, Tokyo demanded that North Korea «promptly and
honestly» report the findings of its latest round of investigations. North Ko-
rea, on its part, announced that a new burial, site containing the remains of
141. ‘Japan Steps Up Pressure on North Korea Over Abductions’, Voanews, 5

May 2015.
142. ‘UN Condemns North Korea’s Human Rights Violations’, Voanews, 27
March 2015.
143. ‘Abe renews pledge to solve North Korean abduction issue’, The Japan
Times, 14 September 2015. Both Foreign Ministers were in the Malaysia’s capital to
attend a series of regional meetings involving the ASEAN and its dialogue partners,
such as the ARF (ASEAN Regional Forum) which is one of the few multilateral minis-
terial meetings that contemplates Pyongyang’s participation.
144. ‘Pyongyang says abductions probe report is ready but Tokyo refused to
receive it’, The Japan Times, 20 August 2015.
145. ‘Negotiating team revamped to break deadlock on abduction issue’, The Ja-
pan Times, 18 October 2015. Another tactics used by Tokyo to try to influence Pyong-
yang was the so-called «indirect diplomacy». For instance, at the end of October, with
a last-minute scheduling decision, he made a stopover in Mongolia (lasting for ap-
proximately 5 hours) as part of his Central Asia tour, a move that some observers con-
sidered important for sustaining Ulaanbaatar government’s continuous cooperation
on resolving the abduction issue with North Korea. ‘With Mongolian stopover, Abe
sought progress on North Korean abductions’, Nikkei Asian Review, 24 October 2015.
89
the Japanese who died at the end of the World War II, had been found on
the outskirts of Pyongyang.146
The clandestine nature of the meetings (another secret meeting had
been held in mid-May 2015 in Mongolia) was, to some extent, probably due
to persistent pressures from both the domestic and foreign audiences.147
Among others, there was a mass public gathering held in Niigata in No-
vember called the «Never forget the Abductees Assembly», led by parents of
the well-known Yokota Megumi, who had come to symbolize the intractable
nature of the issue.148 But there was also news of an internal North Korean
document (a kind of manual of more than 350 pages), most likely dating
back to the 1990s, with contents related to abduction strategies. This man-
ual had apparently been used as part of the intelligence curriculum at the
Kim Jong Il Political-Military University (one of the most secretive North
Korean intelligence institutes). Despite questions about the authenticity of
the document, the Tokyo Shimbun reported that the document confirmed
the claim that the abductions had been carried out in accordance with the
will of the upper echelon of the North Korean leadership. If the manual
does exist and is authentic, and if what claimed by the Tokyo newspaper is
truthful, this news represents the proof that the abduction a program had
been supported by Pyongyang.149
At the same time, North Korea was again under pressure at the UN
(within both the General Assembly and the Security Council) for its human
rights violations. That happened when the media started to focus on the
story of the «ghost ships» containing headless skeletons or rotting corpses.
According to the Japanese media, the «ghost ships» most certainly originat-
ed from North Korea – given the overwhelming evidence pointing in that
direction, in particular the Korean Hangul lettering on the boats and their
«primitive nature».150 Such a phenomenon was not new – on the contrary it
had been happening for years – but new was the number of «ghost boats»
intercepted by the Japanese Coastal Guard: 12 within just 5 weeks (against
a total of 283 in the five years from 2011).151 There was much specula-
tion about the origins of the victims, but the most accepted theory was that
they were most likely fishermen, since fishing nets were found aboard some
146. ‘Japan, North Korea secretly held abduction talks in November’, The Japan
Times, 12 December 2015.
147. D. Kang & Jiun Bang, ‘Japan-Korea relations. A Litigious Time of the
Year’, p. 132.
149. ‘N. Korean «abduction manual» leaked: Tokyo Shimbun’, NK News, 11 No-
vember 2015.
150. ‘Japanese authorities make another grim «ghost ship» discovery’, CNN, 7
December 2015.
151. ‘Mysterious Korean «ghost ships» found in Japan: What we know’, CNN, 2
December 2015.
90
Korea 2015
boats, in particular considering the fact that in the previous months Kim
Jong Un had been pushing the employees in the fishing industry to increase
their catch.152
152. Ibid.
91
Japan 2015: conFronting east asia’s geopolitical gaMe oF go
Giulio Pugliese
This essay1 focuses on the mounting geopolitical tensions around the South China
Sea so as to gauge Japan’s growing assertiveness in foreign and security policy there.
It defines regional strategic interaction in 2015 along the lines of a «game of go»
(known as go or igo in Japan, and as weiqi in China): China calmed the situation in
the East China Sea in the face of Japan’s economic and military-diplomatic pushback,
but it has refocused its energies to building massive constructions on disputed coral
reefs and rocks in the South China Sea’s Spratly Islands. Key events of 2015 hinted at
the insufficiently noted drivers behind Tokyo’s response to Chinese actions in the South
China Sea. This study argues that the new US-Japan security guidelines and the Abe
government’s security laws have sown the seeds for a progressive institutionalization
of Japan’s higher military profile, because these norms granted the United States
leverage vis-à-vis Japan.
Finally, the essay analyzes the state of Sino-Japanese relations throughout 2015 to find
little-appreciated conciliatory overtures that nonetheless clashed with progressively
heightened military and constabulary activities. In that spirit, it analyzes the 14
August Abe Statement and accompanying exegesis in order to stress the Janus-face
quality to the Sino-Japanese cold peace. In conclusion, the essay pits the logic of power
politics against liberal theories of international relations to find that international
economic initiatives in 2015 clearly favored strategic and geopolitical imperatives
over economic considerations. The essay concludes with an assessment of regional
stability, finding mounting turbulence in the short-to-medium term.
1. Introduction
The year under review witnessed the indisputable centrality of geopo-

litics in the East Asian landscape. As recounted in last year’s essay, China
somewhat calmed down the situation in the East China Sea in the face of
Japan’s economic and military-diplomatic pushback. Confronted with Ja-
panese and US resolve over the Senkaku/Diaoyu Islands standoff, Beijing
refocused its energies to building on coral reefs and rocks in the hotly di-
sputed Spratly Islands, in the South China Sea. But it did so while keeping
1. The author wishes to thank Maria Paisley, Paul Midford, Jason Franz, Niall
Coen, Aaron Schroeder-Willis, Brad Glosserman and Hillel Loew for their valuable
comments and support. All errors are the author’s. Twitter account: @Giappugliese.

Giulio PuGliese
Japan busy with aircraft and vessel incursions around the Senkaku Islands
and through a newfound politico-economic synergy with Russia. Moreover,
China started to eye the consolidation of its naval facilities in the Indian
Ocean and beyond to secure its sea lanes.
In other words, strategic interactions started to resemble a «game of go»
(known as go or igo in Japan, and as weiqi in China), where Xi Jinping’s China
jostled for position on the regional chessboard to prevent encirclement and,
if possible, to secure its primacy.2 The South China Sea (SCS) became the
core playground, and the many man-made islands there resembled go’s play-
ing pieces, the «stones». While China was catching up with other claimants’
land-filling operations, the sheer quantity of its efforts risked turning those
waters into a Chinese inland sea, as hinted by a Chinese navy commander’s
controversial statement: «The South China Sea, as the name indicates, is a sea
area that belongs to China».3 In fact, with time China could eventually claim
the entirety of the seas within the so-called Nine Dash Line – including those
areas that overlap with the Exclusive Economic Zones (EEZs) of other littoral
states.4 Geographic misconceptions aside, the logic was straightforward: as
2. Henry Kissinger famously qualified China’s Realpolitik as defined by the logic

of weiqi. By 2015, the same logic extended to most regional players, who grew ever-
more impatient. Kissinger defines the game as follows: «Weiqi translates as ‘a game of
surrounding pieces’; it implies a concept of strategic encirclement. The board, a grid
of nineteen-by-nineteen lines, begins empty. Each player has 180 pieces, or stones, at
his disposal, each of equal value with the others. The players take turns placing stones
at any point on the board, building up positions of strength while working to encircle
and capture the opponent’s stones. Multiple contests take place simultaneously in
different regions of the board. The balance of forces shifts incrementally with each
move, as the players implement strategic plans and react to each other’s initiatives.
At the end of a well-played game, the board is filled by partially interlocking areas of
strength.» Henry Kissinger, On China, London: Allen Lane, 2011, pp. 23-25.
3. ‘UK Progress, Pacific Tensions Key Naval Conference’, Defense News, 16 Sep-
tember 2015. The Vice-Admiral claimed, through an interpreter: «The Chinese peo-
ple have been working and producing around the sea area [since the Han dynasty
(23-220 A.D.)].» However, historical evidence suggests otherwise. The Kingdom of
Funan was the dominant power in Southeast Asia throughout the 5th Century A.D.,
while Chinese ships made trading voyages across the Sea only in the 10th Century
A.D. Moreover, it was the Portuguese that christened the South China Sea waters in
the 16th Century. Cfr. Bill Hayton, The South China Sea: The Struggle for Power in Asia,
New Haven: Yale University Press, 2014, pp. 10-13; 32-33; Chinese netizens’ forceful
defense of the Vice-Admiral statements provides a good window to the underlying
nationalism: ‘«Minami Shina Kai wa Ch goku no mono da!» Ch goku Hokkai Kantai
Shireikan ga Eikoku de «odorokubeki hatsugen» to no hōdō ni «doko ga odorokubeki
no hatsugen?» «tada no jijitsu jan?» – Ch goku Netto’, («The South China Sea Be-
longs to China!» Says Commander of the People’s Liberation Army Navy’s North
Sea Fleet visiting the United Kingdom; Foreign Media Report it as «Surprising
Statement», Chinese Netizens React: «What Exactly is Surprising?», «Isn’t that Plain
Truth?»), Record China, 18 September 2015.
4. The Global Times decreed China’s South China Sea land-filling operations as
«an enormous success; a masterpiece of China’s diplomatic strategy». ‘Ch goku-shi,
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Japan 2015
China’s power grew, so did its desire to secure its immediate neighborhood
and critical Sea Lanes of Communications (SLOCs). At the same time, its
appetite to expand its maritime spheres of interest also grew. By July 2015,
China reclaimed at least 8 square kilometers of new land at seven different
locations. Within 18 months, Chinese man-made islands in the SCS dwarfed
those built by other claimants by both size and scale.
In other words, China’s quest for territory, honor and status over di-
sputed islands coincided with the 21st Century power transition and the bro-
ader strategic game in the East and South China Seas. And in 2015 Japan
confronted a multipolar post-Cold War regional order premised not only
on China’s staggering, if bumpy, ascendance to regional hegemony, but also
on the relative decline of the US, whose commitment to its ally’s security
cannot be taken for granted indefinitely. Indeed, China’s smaller neighbors,
including Japan, advanced more assertively their maritime interests, but in
a way reflective of their own insecurity; they advanced their claims also in
light of the limited «window of opportunity» of the early 2000s, a period of
flux where US military aegis and power projection remained unmatched by
China’s military might, though increasingly deterred by its naval and mili-
tary presence. In fact, China’s neighbors were sometimes the first to adopt
a more proactive stance, but China behaved with a «reactive assertiveness».5
For these reasons, the Senkaku/Diaoyu and Spratly Islands disputes fun-
ctioned as cognitive transference of the broader undercurrents of regional
power transition. Thus, China’s massive land-filling operations in the South
China Sea will render its smaller neighbors helpless vis-à-vis a hegemonic
China; if Beijing enforces its claims following a decade or so of growing
economic and military leverage.
With an eye on the South China Sea grid, Beijing safeguarded its
continental backyard through deepened partnerships and new economic
initiatives. A region-wide dependence on oil imports from the Middle
East and Africa gradually extended the go chessboard beyond the We-
stern Pacific to include the Indian Ocean, where competition between
India and China was intensifying. Yet, in 2015 Chinese military and co-
astguard forces were concentrated in the East and South China Seas, be-
cause Beijing’s assertiveness was informed by both diffuse irredentism
and cool strategic thinking. Strategy-wise, Chinese analysts feared that
the island barrier running north from Borneo to the Philippines, Tai-
wan and Japan restricted the People’s Liberation Army Navy (PLAN) and
ganshō umetate wo «Ch goku gaikō senryaku no kessaku» to jisan’ (Chinese Newspa-
per is Self-Congratulatory on Expansion of Reefs into Artificial Islands: «A Master-
piece of Chinese Foreign Policy Strategy»), Kyodo News, 22 July 2015.
5. Michael Yahuda, Sino-Japanese Relations after the Cold War, London and New
York: Routledge, 2014, pp. 54-59.
95
Giulio PuGliese
obstructed its access to the Pacific.6 Thus, China needed to step up its
naval presence within the so-called «first island chain» to better confront
those key naval powers able to rein in China’s maritime advancement: the
United States and Japan.7 In this context, China continued its naval and
aerial engagement in and above the East China Sea – thus providing the
opportunity to raise its tempo again in the future both to bolster the legal
foundations of its claim over the Senkaku/Diaoyu Islands and to distract
Tokyo from intervention elsewhere. As per the strategic logic of the game
of go, China’s engagement in the East China Sea and its constabulary
build-up reminded Japan of the risks of stretching out its naval presence
to distant Southeast Asian waters.
After all, the SCS is of paramount importance to the global economy
and to maritime powers such as Japan and China. Trade that flows through
the SCS can be diverted to other waterways, like the Lombok or Australian
Straits, without much loss; at the same time, China and Japan’s SLOCS are
effectively indivisible, at least in the South China Sea and beyond. What
threatens Japan’s SLOCS also threatens China’s. Moreover, in the after-
math of the nuclear disaster of 11 March 2011, Japan’s post-Fukushima
energy security increasingly relied on imported natural combustibles such
as oil; and 88% of Japan’s oil imports passed through the Strait of Ma-
lacca.8 Yet, post-war Japan traditionally played a low key politico-military
role in securing these SLOCs on the basis of two fundamental factors: the
relative lack of concern among regional players about the nature of Chi-
na’s ascent – compounded by US military primacy and reliable security
commitments, and Southeast Asian states’ deep-held suspicion of Japan’s
military involvement. In 1994, late Singaporean strongman Lee Kuan Yew
still held the belief that «allowing Japan to send its forces abroad is like
giving liquor to an alcoholic».9
The regional interplay changed in the first decade of the 21st Centu-
ry. Washington’s military resolve gradually waned due to the United Sta-
tes’ involvement in the quagmires of the Iraq and Afghanistan wars, whi-
le China ruffled the feathers of several Southeast Asian states through a
newfound assertiveness. Beijing now aimed at securing its «core interests»,
which possibly included the whole South China Sea. China traditionally
made use of this wording with reference to Taiwan, Tibet and Xinjiang,
but Chinese officials started to apply it also to disputed territories in the
6. Toshi Yoshihara & James R. Holmes, Red Star over the Pacific: China’s Rise and
the Challenge to US Maritime Strategy, Annapolis: Naval Institute Press, 2010, pp. 51-54.
7. The United States, Japan and China are the main subjects of this essay, be-
cause of their decisive military and economic weight for regional stability.
8. Paul Midford, ‘Japan’s Approach to Maritime Security in the South China
Sea’, Asian Survey, vol. 55, n. 3, May/June 2015, pp. 525-547.
9. Fareed Zakaria, ‘A Conversation with Lee Kuan Yew’, Foreign Affairs, Vol. 73,
No.2, March/April 1994, §8.
96
Japan 2015
East and South China Seas. By 2010, China began to widen the definition
of the term: an ambiguous stance reiterated in private conversations with
US officials was, possibly, becoming official government policy.10 Thus,
on November 3 2015, Minister of Defense Chang Wanquan became the
highest ranking Chinese official to unequivocally refer to the SCS as Chi-
na’s «core interest»; it was significant that he did so while meeting his US
counterpart, possibly an indication that Chinese policymakers increasin-
gly understood Washington’s resolve as a paper tiger.11 Thus, with greater
power came greater confidence, and the Chinese elite gradually gravi-
tated in favor of abandoning Deng Xiaoping’s low-profile foreign policy
strategy (tao guang yang hui).
Along with Chinese assertiveness and US fatigue, Premier Abe Shinzō’s
quest for a strong Japan and Washington’s increased reliance on its regional
ally for the preservation of the wobbling regional status quo drove Japan’s
security renaissance. Thus, in early 2015 the Abe government agreed to a
set of new security guidelines governing the bilateral alliance and rammed
through the Diet the contentious security laws that fleshed out ways for Ja-
pan to exercise collective self-defense. Concretely, these laws lifted Japan’s
restrictions over military support to friendly forces when the situation en-
dangered Japanese security, as defined in the broad sense. As a consequen-
ce, by mid-2015 Japanese lawmakers started to sell the SCS as a vital sea
lane mired by Chinese expansionist claims, as part of the rationale for the
right for collective self-defense. Thus, Japan was ready to share the alliance
burden and, if push came to shove, add its military might to the US-led de-
terrence mix in the SCS. While operations would be limited to non-combat
roles, Japanese officials signaled to China that if it did not soften its growing
assertiveness in the Spratlys, Japan’s military would go beyond its usual ge-
ographic scope of action. The Abe government demonstrated it was a keen
player of the East Asian game of go.
Scholars have emphasized the Abe-centered ideological factors behind
Japan’s proactive security posture.12 Other authors, instead, have stressed
10. See, especially: ‘Liu Cigui: Weihu Zhongguo zai Nanhai de quanyi shi guan
guojia hexin liyi’ (Li Cigui: Safeguard China’s Core State Interests in the South China
Sea), China News Service (Zhongguo Xinwen Wang), 26 October 2012; Edward Wong,
‘Security Law Suggests a Broadening of China’s «Core Interests»’, The New York Times,
2 July 2015.
11. Ministry of National Defense of the People’s Republic of China, ‘Chang
Wanquan huijian Meiguo Guofang Buzhang Kate’ (Chang Wanquan Met US Secre-
tary of Defense Carter), 4 November 2015 (http://www.mod.gov.cn/leader/2015-11/04/
content_4627150.htm), §6.
12. Giulio Pugliese, ‘Giappone: il ritorno di Abe’ (Japan: Abe’s Comeback), Asia
Maior 2013, pp. 409-444; Giulio Pugliese, ‘Japan 2014: Between a China Question
and a China Obsession’, Asia Maior 2014, pp. 43-97; Christopher W. Hughes, Japan’s
Foreign and Security Policy Under the «Abe Doctrine»: New Dynamism or New Dead End?
Basingstoke: Palgrave Macmillan, 2015, pp. 8-27.
97
Giulio PuGliese
continuity and altogether downplayed the implications of Abe’s security re-

forms.13 Through an analysis of the momentous history of 2015, this essay
argues that Abe’s success in endowing Japan with the right of collective self-
defense planted the insufficiently noted institutional seeds that were already
forcing Tokyo to a more decisive military profile. For that purpose, in addition
to China’s assertiveness and Abe’s taste for power politics, the essay details the
deepened leverage enjoyed by the United States over Japan’s low key military
involvement in the SCS. In turn, Japan’s direct engagement in South China
Sea issues called China’s tactical accommodation bluff against Japan, althou-
gh the bilateral cold peace continued throughout the year under review.
In order to present a historical overview of 2015 through these lenses,
the first section highlights the nature of the new US-Japan security guide-
lines and of Japan’s security laws. The section concludes by pointing at the
resilience of Abe’s domestic political mandate, widespread demonstrations
notwithstanding. The second section gauges the timid Sino-Japanese politi-
cal overtures witnessed in 2015 against the backdrop of a region increasingly
defined by the logic of power politics. A thorough analysis of the government-
backed 14 August Abe Statement to commemorate the end of World War II
highlights the Janus-like quality of the Sino-Japanese cold peace, which is
also reflected on the Chinese side; the Statement testified to a working-level
political agreement to move bilateral relations forward, but its language si-
gnaled resolve against what Tokyo understood to be a revisionist China bent
on asserting its regional dominance. Indeed, the major international econo-
mic initiatives finalized by Beijing, Tokyo and Washington in 2015 testified
to an ongoing geopolitical rivalry between China and the two major regional
players. In light of these events, the essay concludes with an assessment of the
prospects for regional stability in the medium term.
2. Deepening the US-Japan alliance: Mr. Abe goes to Washington
On April 26 Abe Shinzō made a historical week-long trip to the United

States. His state visit to Washington D.C. was marked by initiatives of rele-
vance for the future of Asia-Pacific security. Fifty-five years after Prime Mini-
ster Kishi Nobusuke’s tortuous ratification of the US-Japan Treaty of Mutual
Cooperation and Security, Kishi’s grandson undersigned new wedding vows
with his American counterpart. This was a necessary step to allow Japan to
play a bigger military role – an explicit component of Abe’s security agenda.
In addition, the Japanese and United States governments agreed to tame
an assertive China by taking a more dynamic military stance. In that spirit,
13. Paul Midford, ‘Japan’s Approach to Maritime Security in the South China
Sea’; Adam P. Liff, ‘Japan’s Defense Policy: Abe the Evolutionary’, The Washington
Quarterly, Vol. 38, No. 2, July 2015, pp. 79-99.
98
Japan 2015
deeper security ties and interoperability with Washington and like-minded

maritime states in the Asia-Pacific would have increased the coercive tools
at Tokyo’s disposal vis-à-vis Beijing. Thus, on the occasion of the Security
Treaty’s Emerald anniversary, the US and Japan agreed to new security gui-
delines, an addendum to the new Security Treaty that altogether avoided a
divisive ratification process.
The new guidelines fleshed out the two allies’ new responsibilities: a
more coordinated joint command, interoperability and modernization of
their respective armed forces, with the possible inclusion of other US al-
lies, such as Australia. Strengthened by Abe’s security reforms and the July
2014 constitutional reinterpretation that endowed Japan with the right of
collective self-defense, Tokyo would be on the frontline of its territorial de-
fense and assume responsibility for logistical and military support to US
and friendly forces on a global level. At the same time, these activities were
limited to non-combat operations and, in all likelihood, to the East Asian
region. Japan’s greater contribution to regional security would have none-
theless upgraded the US-Japan alliance to a more equitable one. China was
the target of these new nuptial vows.
Indeed, diplomatic propriety mandated the two governments to rei-
terate that the guidelines did not aim at a specific target country. But Chi-
na was the elephant in the room that was responsible for the camaraderie
between the Obama-Abe odd couple. In fact, Obama and Abe asserted that
«State actions which tended to undermine respect for sovereignty and terri-
torial integrity by attempting to unilaterally change the status quo by force
or coercion, would pose challenges to the international order».14 In a simi-
lar way, Abe’s historic speech to a joint session of the US Congress – «Toward
an alliance of hope» – never actually used the «C word», but implicitly iden-
tified China through the clear enumeration of the alliance’s aims: peaceful
resolution of international disputes, respect of international law, democracy,
human rights and the like.15 Subsequently, Abe’s 2015 visit to the United
States signaled to Beijing an unwavering, newfound synergy between Tokyo
and Washington.
As recounted in last year’s essay, the right of collective self-defense
would be limited to aiding friendly countries under attack, when said-at-
tack threatens «Japan’s survival and poses a clear danger to fundamental-
ly overturn people’s right to life, liberty and pursuit of happiness (sic)».16
14. The White House, US-Japan Joint Vision Statement, 28 April 2015 (https://
www.whitehouse.gov/the-press-office/2015/04/28/us-japan-joint-vision-statement).
15. Ministry of Foreign Affairs of Japan, Address by Prime Minister Shinzo Abe to a
Joint Meeting of the US Congress «Toward an Alliance of Hope», 29 April 2015 (http://www.
mofa.go.jp/na/na1/us/page4e_000241.html).
16. Government of Japan, Cabinet Decision on Development of Seamless Security
Legislation to Ensure Japan’s Survival and Protect its People, 1 July 2014 (http://www.mofa.
go.jp/fp/nsp/page23e_000273.html).
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Giulio PuGliese
Many Japan security watchers ignored this cumbersome definition under

the deep-held belief that the fundamentals of Japanese security will be con-
stant: Tokyo would engage in military operations only when its survival is
in peril. But this is not exactly the case. While Japan would likely be invol-
ved in non-military operations, the deployment of its armed forces could
well go beyond the survival of physical persons to include the safeguard
of energy supplies and national assets when these pose a «clear danger»
to Japan. This interpretation is key to understanding the significance of
Abe’s security bills and was the necessary prelude to Japan’s more active
involvement in the SCS. At any rate, even a restrictive interpretation of
the new legislation could allow action in the South China Sea: after all, the
Sea’s Hainan Island hosts a major Chinese submarine base, which inclu-
des vessels operating around Japan. That and the Japanese government’s
growing insistence on the menace of a Chinese domination of the SCS
implies that Chinese actions there can easily be interpreted as imperiling
Japanese physical security.
2.1. Japan’s mounting interest in the South China Sea and its logic
It is telling that in 2015 Tokyo signaled with greater intensity its active
interest in balancing China’s growing clout in the South China Sea through
non-combat military operations. By that summer, the Japanese media slowly
gravitated towards alarmed denunciations of China’s construction of artifi-
cial islands. In the author’s view the news media echoed the government’s
insistence and played a secondary role in shaping the domestic discourse.
See, for instance, Newsweek Japan’s cover story: «China’s well-thought plan
to seize the South China Sea» with its cover drawn by a famous Chinese
cartoonist dissident, who fled to Japan.17 Moreover, a search in the archives
of the Japanese Diet’s deliberations points at lawmakers’ increased sense of
urgency on the matter, in particular from spring 2015 onwards, possibly in
connection with the deliberations over the security bills.
Finally, the annual Defense White Paper testified to Japan’s heightened
alarm: «China continues to act in an assertive manner, including coercive
attempts at changing the status quo, and is poised to fulfill its unilateral
demands without compromise».18 The 2015 White Paper included reference
to «[China’s] rapid and large-scale land reclamation work in seven features
in parts of the Spratly Islands» and, at the insistence of conservative LDP
lawmakers, it included aerial photographs of China’s sand-filling activities
17. ‘Tokush : Minami Shina Kai wo Senryō suru Ch goku no shinbō’ (Special
Report: China’s well-thought plan to seize the South China Sea), Newsweek Japan, 7
July 2015.
18. Ministry of Defense - Japan, Defense of Japan 2015, Tokyo, July 2015, see in
particular: ‘Defense Policies of Countries: Section 3 - China’ (http://www.mod.go.jp/e/
publ/w_paper/pdf/2015/DOJ2015_1-1-3_web.pdf).
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Japan 2015
over the Johnson South Reef and the Subi Reef.19 Japanese news somewhat
echoed the alarmism insisted upon by the political elite,20 but so did bure-
aucratic agencies: the Japanese Defense Ministry had already provided a
graphic picture of a South China Sea dominated by China, with red-colored
infographics that pointed at a «China menace».21 It was not a coincidence
that these publicity activities coincided with the Diet passage of the embat-
tled Security Bills and the new US-Japan security guidelines, but China’s
non-stop land-filling operations there contributed to the sense of danger. At
any rate, the Abe government killed three birds with one stone: it reassured
Washington of Japan’s newfound proactivity; it signaled resolve to Beijing;
and it heightened alarm among the general public to facilitate passage of
bold security reforms.22
In all likelihood China’s hawkish foreign policy actors – and they li-
kely included the ever-more powerful Xi Jinping (on Xi’s accommodating
comments towards Japan vis-à-vis the propaganda department’s line see
sections below) – aimed at realizing the long-term vision of turning the
South China Sea into an inland basin. The sheer number and progressive
militarization of the artificial islands would have convinced China’s smal-
ler neighbors through fait accompli of its regional primacy; together with
its growing asymmetric warfare capabilities, these would have deterred the
US from meddling in China’s immediate neighborhood. That is, Beijing
was taking concrete steps to secure its own coastline and beyond, to enact
a 21st Century, Chinese version of the Monroe Doctrine. Yet, there was a
key difference between contemporary East Asia and 19th Century America:
China’s neighbors were no «banana republics», or powerless client states of
the regional hegemonic power. Moreover, the United States remained an
engaged resident power: it committed its military might to the region and
also bolstered the military capacity of smaller states to preserve a favorable
regional multi-polarity, as demonstrated by Japan’s case. In that sense, the
SCS stormy waters became ever more stormy, thanks to mounting waves
of Sino-US strategic rivalry in 2015. In late October, the Obama admini-
stration’s decision to institutionalize «Freedom of Navigation» operations
19. Ibid.
20. See, for instance: ‘Bōei hakusho: Ch goku no kaiyō shinshutsu wo hihan
– Minami Shina Kai umetate kyōkō’ (Defense White Paper: Criticism of China’s Ad-
vancement into theSeas and of its South China Sea Land-filling Operations), Mainichi
Shinbun, 21 July 2015.
21. Ministry of Defense - Japan, China’s Activities in the South China Sea, 28 July
2015 (http://www.mod.go.jp/j/approach/surround/pdf/ch_d-act_20150728e.pdf); the
original Japanese slides – Minami Shina-kai ni okeru Chūgoku no katsudō – date back
to May 2015.
22. On the last two aspects: Giulio Pugliese, ‘The China Challenge, Abe Shinzo’s
Realism, and the Limits of Japanese Nationalism’, The SAIS Review of International Af-
fairs, Vol. 35, No. 2, Summer-Fall 2015, pp. 45-55.
101
Giulio PuGliese
within the waters of China’s man-made islands in the Spratlys testified to

testy relations between Beijing and Washington.
Indeed, Tokyo borrowed Washington’s language register to call for
«Freedom of Navigation» (FON) operations. Accordingly, the United States
would start sending naval forces within the 12 nautical miles of disputed
– but progressively militarized – rocks and reefs, to prove these were not
islands. Washington used its military might to balance Chinese assertiveness
and to make a point: the man-made «islands» were not entitled to broad
territorial waters and an Exclusive Economic Zone. Instead, Japanese op-
tions probably entailed surveillance operations over the open seas around
the disputed Spratly Islands to aid Washington and signal military resolve
to China.23 Thus, Tokyo’s bolder and broader security profile echoed a bela-
ted, but somewhat less conciliatory US posture and reflected the newfound
clout of the Department of Defense headed by Ashton Carter. Back in May
2015 Washington allowed, for the very first time, CNN cameras on board
a Navy surveillance aircraft to graphically display China’s island-building
in the SCS. That is, the US government placed a bright spotlight on the
likely militarization of China’s artificial islands; the video, which included
enraged calls by PLA officials to drive away the US spy plane, signaled US
commitment there.24 Through its ambassador in Washington, China retor-
ted with its own set of velvet accusations on several media outlets and a po-
pular CNN talk-show. Here, Ambassador Cui Tiankai stated: «I wish the US
would really do something to lower the temperature, to reduce the tensions
there. So I hope people in the US will refrain from making all the coercive
statements, will refrain from making all the coercive actions there».25 In
late October, Washington started, if cautiously, its «Freedom of Navigation»
operations over reefs under Chinese control.26
As mentioned earlier, the timing of Washington’s emboldened re-
solve against Beijing suggests that the new US-Japan security guidelines
and Abe’s security laws – unorthodoxly promised ahead of time to a joint
US Congress, and rammed through the Japanese Diet in the summer of
2015 – were key pieces in the regional game of go. The subtle threat of
Japan’s involvement in the SCS was an additional stick to deter China from
mounting the escalation ladder vis-à-vis Washington, for instance through
further militarization of the islands. Experts warned US policymakers about
23. ‘Japan may conduct South China Sea patrols, says military chief ’, The
Guardian, 17 July 2015.
24. ‘Exclusive: China warns US surveillance plane’, CNN News, 26 May 2015
(updated on 15 September), (http://edition.cnn.com/2015/05/20/politics/south-china-
sea-navy-flight).
25. ‘CNN’s Amanpour: Standoff in South China Sea; World Leaders Arrive in
Germany for G7 Summit; Calls for FIFA Reform; Imagine a World.’ CNN (Transcripts),
4 June 2015, (http://edition.cnn.com/TRANSCRIPTS/1506/04/ampr.01.html).
26. Demetri Sevastopulo & Geoff Dyer, ‘US Navy operations send muddled
message to China’, The Financial Times, 7 November 2015.
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Japan 2015
expectation gaps on Japanese commitment to alliance burden-sharing and

discounted a major shift in Japan’s involvement in the SCS beyond capaci-
ty-building. However, the Japanese government was building momentum
for direct action, possibly entailing surveillance operations. Japan’s higher
military profile was not just an index of Chinese assertiveness but resulted
from a mix of other factors: first, Abe’s idiosyncratic perception of Japan
as a Great Power; second, Abe’s willingness to use military tools in order
to strategically counter-balance China’s assertiveness more forcefully; third,
Tokyo’s willingness to deepen military cooperation with strategic players
in a scenario of common concern, China’s undisputed regional hegemony.
Thus, as recounted in previous essays, Abe Shinzō’s long-term aim for Japan
was the building of a coalition of China-balancing naval powers. Finally, and
most importantly, Washington saluted and prompted Tokyo’s increasingly
assertive signals and actions in the SCS. This was evident, for example, by
the timing of the alliance’s new security guidelines: Tokyo and Washington
controversially decided to sign the guidelines before the passage of the Japa-
nese security bills. They did so to send a strong signal to Beijing.
Interestingly, analysts failed to notice Washington’s newfound levera-
ge over Tokyo’s military posture which was embedded in the new security
guidelines. Notably absent from the guidelines was any specific action over
the islands disputed between Japan and China. Senior US officials and Pre-
sident Obama himself made it clear that the Senkaku/Diaoyu Islands fell
within the scope of the US-Japan treaty of mutual cooperation and secu-
rity, by virtue of Japanese «administration» of the islands, but the US did
not take sides on the territorial dispute and intended not to provoke other
claimants, first and foremost China. As noted elsewhere, Washington «is
likely to oppose the inclusion of specific guidelines over the islands in order
to avoid entrapment concerns and to gain leverage over Japanese actions
in dealing with the territorial issue».27 I would push this reasoning a step
further and argue that the US sought to gain leverage not only on Japan’s
actions in the East China Sea, but on Japan’s contribution to alliance bur-
den-sharing in the 2015 «upgrade» to the US-Japan Mutual Security Treaty:
the guidelines lacked specifications over the Senkaku/Diaoyu Islands and
– importantly and unappreciated – on what qualifies and what does not as
a «grey zone» scenario (i.e. Chinese coercive behavior that doesn’t constitu-
te outright aggression). In short, by feeding Japan’s insecurity Washington
denied Japan leverage whilst gaining leverage itself in theaters beyond the
Senkaku/Diaoyu. A clear example of the working of this logic is provided by
the strategic ambiguity embedded in the Australia, New Zealand, United
States Security Treaty (ANZUS), where Article IV avoids spelling out US
military commitment to rescue its allies in case of a contingency. Such a
27. Bjørn Elias Mikalsen Grønning, ‘Japan’s Shifting Military Priorities: Coun-
terbalancing China’s Rise’, Asian Security, Vol. 10, No. 1, 2014, p. 8.
103
Giulio PuGliese
lack of specificity has nurtured Canberra’s fears of abandonment and, in

light of such, an incredibly consistent commitment to all major US military
operations since the inception of ANZUS in 1951. It is worth noting that
Australia has wholeheartedly committed blood and treasure to its partner-
ship with the US, even when said military operations were incredibly costly,
if not altogether hazardous, to its own national security.28 The same logic
has also applied to Italy in instances such as its military involvement in Iraq
following the US-led invasion in 2003.29 Thus, Japan signaled its resolution
to put a halt to Chinese unilateral actions in the South China Sea – through
joint military exercises near those waters, low key surveillance operations,
and a more assertive language register – to pay the increasingly expensive
insurance premiums for securing US extended deterrence.
Certainly the Japanese government’s determination to showcase mili-
tary preparedness by engaging in non-combat activities away from the ECS
was also calculated to increase Japan’s appeal as a security partner to regio-
nal players other than the United States. After all, Tokyo was adjusting its
military posture to the harsh realities of a markedly more multipolar regio-
nal environment. It helped that an increasing number of China’s maritime
neighbors in the South China Sea welcomed Japanese proactive behavior,
but Tokyo’s effective counter-balance would have functioned especially with
major Indo-Pacific players: the US, Australia, India and, possibly, Indonesia.
At the same time, the only external partner capable of credible deterrence
against Chinese assertiveness in the East China Seas remained the United
States. Its unmatched military capabilities over the safeguard of Japan’s se-
curity provided leverage to cajole Tokyo into accepting an increased share
of the burden of the alliance in the South China Sea. For these reasons,
the relative vagueness of US security commitments inspired its dependent
allies, such as Japan, to go «above and beyond» of their own accord – that
is, they proactively tried to prove their usefulness to Washington, and Wa-
shington facilitated such proactivity through vague security commitments.
For instance, evidence shows that the Americans asked for support in the
SCS in unmistakable terms during a December 2014 meeting taking place
in the Pentagon between then US Chief of Naval Operations, Admiral Scott
Swift, and the Japanese Chief of Staff, Admiral Kawano Katsutoshi. Ministry
of Defense (MOD) sources leaked the minutes of this meeting to the feisty
Japanese Communist Party in the summer of 2015, but the news was intere-
stingly given very small publicity; yet, the MOD confirmed the leakage and
Swift’s requests testify to the afore-mentioned dynamics: «India is making a
28. Mark Beeson, ‘With Friends Like These: Reassessing the Australia-US Re-
lationship’, in Mark Beeson (ed.), Bush and Asia: America’s Evolving Relations with East
Asia, London and New York: Routledge, 2006, pp. 213-227.
29. Ronald Dore, Giulio Pugliese, & Ezra Vogel, ‘Nihon wa jikuashi wo okubeki
wa, Beikoku? Ch goku?’ (What Ought to Be Japan’s Pivot? The US or China?), Chūō
Kōron, Vol. 128, No. 6, 2012, pp. 82-92.
104
Japan 2015
variety of port calls starting with Vietnam, on occasion of military exercises

in the South China Sea. Ought Japan not make similar strategic port calls?
Ought Japan not send a message through port calls also in Singapore and
Kuala Lumpur?»30 Would Japan easily concede to pressure from the US? An
anonymous Japanese Ministry of Defense official confirmed Japan’s recep-
tiveness when he asked, rhetorically: «Ought Japan not support the United
States even by stretching its forces down in the South China Sea, in exchange
for American support in the East China Sea?»31 By October 2015, Japanese
military planners confirmed a Vietnam port call scheduled for the next year.32
Interviews with US and Japanese policymakers implicitly unveiled the
Realist quality and US expectations behind the deepened bilateral entente.
Ambassador Richard Armitage praised the historic importance of Abe’s se-
curity reforms and highlighted the possibility that the right to collective self-
defense would entail Japan’s future involvement in US wars, «but as it is quite
clear, the Japanese will have to go through the Diet to get Diet permission».33
At the same time, one of Abe’s advisors accepted arguments that stressed
Japanese dependence on the United States. Asked about Japanese policyma-
kers’ increased reliance on Washington for military deterrence and intelligen-
ce as well as Japan’s outright psychological dependence on the US, he agreed
on the assessment, but discounted the risks of entrapment in US conflicts be-
cause of Washington’s post-Iraqi syndrome fatigue over military interventions
abroad.34 The Obama White House’s caution over Chinese activities in the
South China Sea and elsewhere validates this argument, but an emboldened
new US president could drag Japan into a military confrontation.
Thus, Japan’s words and eventual military deeds around the South
China Sea were not necessarily in Tokyo’s own national interest. They came
at the cost of further alienating China and ran the risk of embroiling Japan
in a US-China confrontation. Yet, that China responded to Japan’s indica-
tion that it might become involved with an accusatory rebuttal showed that
Beijing had taken a tactical decision to calm the situation in the East China
Sea, while at the same time appeasing a more external-oriented Japan. Fol-
lowing a series of declarations by Japanese Navy officials, China responded
by calling for Japan to «put an immediate end to the hyping up of the South
China Sea issue [to] genuinely maintain the momentum of improving bi-
30. Yomiuri Shinbun Seijibu, Abe Kantei tai Shū Kinpei (Abe’s Kantei vs. Xi Jin-
ping), Tokyo: Shinchōsha, 2015, pp. 67-69.
31. ‘Bei «do wo kosu shuchō ni idomu» Ch goku kensei he Minami Shina-kai
kōkō’ (United States Exerts Navigation Activities in the South China Sea to Keep
China in Check: «We Are Challenging Excessive Claims»), Asahi Shinbun, 28 October
2015.
32. ‘Japan plans Vietnam port call to check Chinese expansion’, Nikkei Asian
Review, 30 October 2015.
33. Personal interview with Ambassador Richard Armitage, Tokyo, 1 August
2014.
34. Personal interview with Japanese policymaker, 30 July 2014.
105
Giulio PuGliese
lateral relations».35 Japan’s signaling of military resolve in the area called

Beijing’s tactical-accommodation bluff vis-à-vis Tokyo.
In light of these developments China continued to exert a degree of
pressure over the Senkaku/Diaoyu Islands, to which it began to send ves-
sels on a more regular basis. A cursory look at the date of the incursions
within the Japan-administered islands revealed that Chinese constabulary
forces routinely entered the Senkaku waters every ten days.36 But Beijing
was always ready to up the tempo further, if needed. By the end of 2015,
the East China Sea witnessed a new round of bilateral tensions, partly in
connection with Japan’s growing involvement in the South China Sea.37 The
game of chicken over the Senkaku/Diaoyu Islands clearly developed into a
game of go in the broader East Asian chessboard.
2.2. Japan’s domestic politics and the limits to Tokyo’s proactive posture38
Yet, Japan’s insular public opinion remained Abe’s Achilles’ Heel, be-
cause it prevented him from signaling credible Japanese deterrence against
35. Consulate General of the People’s Republic of China in Sydney, Foreign Min-
istry Spokesperson Hong Lei’s Regular Press Conference on June 12, 2015, 12 June 2015,
(http://sydney.chineseconsulate.org/eng/fyrth/t1272736.htm). It went on to say: «The
Chinese side is gravely concerned and indignant about the negative moves of the
Japanese side. We have lodged multiple solemn representations with Japan. I want to
emphasize that China has indisputable sovereignty over the Nansha Islands and the
adjacent waters. China’s construction on some garrisoned maritime features of the
Nansha Islands is well within China’s sovereignty. It is lawful, justified and reasonable,
not directed at any other country and thus beyond any reproach. Japan is not a party
concerned to the South China Sea issue. Recently it has behaved in an abnormal way,
deliberately thrust a hand in the South China Sea issue, driven a wedge among region-
al countries and maliciously created tensions in the South China Sea. Japan’s moves
do no good to solve the South China Sea disputes, or safeguard peace and stability of
the South China Sea. It also severely damages the political and security mutual trust
between China and Japan, and runs counter to the momentum of improving bilateral
relations. We once again urge the Japanese side to abide by its commitment of not
taking sides on the South China Sea disputes, put an immediate end to the hyping up
of the South China Sea issue and groundless accusations against China, stop provok-
ing conflicts among different parties for self-serving interests, genuinely maintain the
momentum of improving Sino-Japanese relations and respect the efforts by China and
ASEAN countries to safeguard peace and stability of the South China Sea».
36. China’s State Information Office, ‘Diaoyu Dao – The Inherent Territory of
China’, (http://www.diaoyudao.org.cn).
37. David Tweed & James Mayger, ‘China Sends Japan a «Don’t Meddle» Mes-
sage Via an Ex-Navy Ship’, Bloomberg Business, 29 December 2015.
38. Small portions of this section are reprinted from another article, courtesy of
Johns Hopkins University Press: Giulio Pugliese, ‘The China Challenge, Abe Shinzo’s
Realism and the Limits of Japanese Nationalism’, The SAIS Review of International Af-
fairs, Vol. 35, No. 2, Summer-Fall 2015, pp. 45-55.
106
Japan 2015
Chinese actions in the South China Sea. While the Abe administration pro-
gressively cemented Japan’s security stance, Japanese citizens still prioriti-
zed economic performance above any other policy issue. Moreover, Japa-
nese voters were decidedly allergic to Abe’s security-oriented legislation. A
variety of public opinion polls and well-thought arguments demonstrated
that Japan still abided by deeply held norms of anti-militarism, in stark
comparison with mounting Chinese nationalism.39 If push came to shove in
2015, 71% of Chinese were reportedly willing to fight for their country, as
compared with only 11% of Japanese: 5% fewer than 2010 and the world’s
lowest percentage.40 Moreover, a 10% decrease in the number of applicants
to the Japanese Self-Defense Forces and the marked increase of Defense
University graduates refusing to enter into service, most likely resulted from
increased sensibility to risk.41 But was this risk only of China’s making? Evi-
dence shows that Japanese voters disapproved of Abe’s 2013 visit to the Ya-
sukuni Shrine, both in itself and also for the effect it had on stoking tensions
with its neighbors. Accordingly, these statistics imply that even if Japan’s
impressions of China had reached rock bottom,42 they neither translated
into bellicose popular enmity which would have allowed swift passage of
the security laws, nor did they prop up domestic support for the Abe go-
vernment. Quite the opposite.
Thus, it would be misleading to say that the Abe administration was so-
lely concerned with using the China danger during the fiercely debated Diet
deliberations. Abe needed to dispel citizens’ concerns about his hawkish
reputation and, to that end, the government reiterated through words and
39. Andrew L. Oros, ‘International and Domestic Challenges to Japan’s Postwar

Security Identity: «Norm Constructivism» and Japan’s New «Proactive Pacifism»’, The
Pacific Review, Vol. 28, No. 1, 2015, pp. 139-160.
40. The question’s wording reads as follows: «Of course, we all hope that there
will not be another war, but if it were to come to that, would you be willing to fight
for your country?» Please refer to the World Values Survey database for comparisons
(http://www.worldvaluessurvey.org); see also: ‘«Anata no Kuni ga sensou ni makiko-
maretara susunde tatakauka» to toware «hai» to kotaeta hito, Nihon wa 11% de sekai
saitei, Ch goku wa 71% – kokusai yoron chōsa’ (Would You be Willing to Fight if Your
Country Had to Fight a War? Positive Respondents Were 11% in Japan, the World’s
Lowest, 71% in China – International Opinion Poll), Record China, 18 March 2015.
41. Reiji Yoshida, ‘Polling shows voters unclear about Article 9 reinterpreta-
tion: expert’, The Japan Times, 11 July 2014; ‘Jieikan ōbo: nokinami genshō boueishō
«sh danteki jiei-ken» hitei’ (Decrease Across the Board for Applications to the JSDF,
Ministry of Defense: «Unrelated to Dislike of Collective Self-Defense»), Mainichi Shin-
bun, 20 November 2014.
42. A Japanese Non-Profit Organization, GENRON NPO, has aimed at enhanc-
ing dialogue between Japan and its neighbors through a variety of activities since the
mid-2000s. Among these activities are annual public opinion surveys conducted in Ja-
pan and China through the cooperation of Chinese partners: Genron NPO, The 10th
Japan-China Public Opinion Poll: Analysis Report on the Comparative Data, 9 September
2014 (http://www.genron-npo.net/en/pp/archives/5153.html).
107
Giulio PuGliese
deeds that he was committed to «peace diplomacy» (heiwa gaikō) as the pri-
mary means of solving international disputes. Moreover, Abe capitalized on
foreign endorsements to his security agenda in order to appeal to an insular
public opinion. It referenced these very many endorsements ahead of the
Diet deliberations over the security bills, including a major TV appearance
in July.43
Abe’s push met vocal domestic resistance, which included street de-
monstrations around the Diet building. Public opinion polls dipped to a th-
ree-year low, but Abe was still able to renovate his mandate as LDP President
in September 2015. Japanese citizens were also distrustful of the opposition
parties, which were still unable to arrange a united front against the LDP-
New Komeito majority. Abe wisely toned down his revisionist colors to cater
to the sensibilities of a moderate Japanese public opinion: he did not hollow
out the 1993 Kono and 1995 Murayama Statements, as many commentators
feared. In fact, wording in the August 14 Abe Statement hinted at a bilate-
ral Sino-Japanese effort to resume working-level relations. In addition, Abe
sought a degree of stability in Sino-Japanese relations in order to convince
domestic public opinion of his pragmatism.
In evidence of the success of Abe’s strategies and of the lack of political
alternatives to his rule, two months following the contentious passage of
the poorly explained security laws, the Abe government recovered public
support above the 50% threshold. Domestic politics in 2015 testified to the
relative stability of the Abe administration, but Japanese aversion to a more
assertive security posture would have likely permitted only limited engage-
ment in the South China Sea.
3. The Sino-Japanese truce: toning down bilateral acrimony
But how did Japan and China achieve a very timid thaw in politi-
cal relations in 2015? As recounted in last year’s essay, the vicious cycle
of recrimination which the two governments initiated in September 2012
gained new heights in 2014. The Chinese propaganda apparatus had in-
sisted on the so-called «history issue» as a mirror of Japan’s «revision-
ist» and «militaristic» behavior that acted in defiance of «the world order
created after the victorious war against fascism». Illustrating the logic of
the «propaganda dilemma», according to which both the Abe and Xi Jin-
ping administrations refurbished the two states’ propaganda machines to
secure their respective self-righteous narratives, Tokyo responded in full
43. Abe Shushō, ‘Minna no ny su nama shutsuen; Kokumin no gimon SP’ (Spe-
cial Episode: Premier Abe LIVE on Minna no Ny su; Answers to Citizens’ Doubts), Min-
na no Nyūsu - FNN, 20 July 2015 (https://www.youtube.com/watch?v=bp2npFwvb2U).
108
Japan 2015
force to Chinese attacks. 44 On the occasion of Abe’s historic visit to the

US, Tokyo staged a highly symbolic gesture of bilateral reconciliation be-
tween two war veterans during his speech to a Joint Congress.45 The mes-
sage resonated with Abe’s insistence on a «forward-oriented» outlook that
stressed post-war Japan’s constructive role in international society and its
«proactive contribution to peace», but the unspoken aim was to neutralize
Beijing’s (and Seoul’s) politicized criticisms of Japan’s historical revision-
ism and showcase to international and domestic audiences that the «inter-
national community» was with Abe.
Following Abe’s successful state visit to Washington D.C., MOFA re-
leased an illuminating video titled «Communication and Reconciliation in
the Post War Era», available in Japanese and several foreign languages: it
stressed how the US, Australia, the Philippines and ASEAN nations have
moved past the war legacy to the degree that «enemies that have fought
each-other so fiercely have become friends bonded in spirit», an explicit ref-
erence to Abe’s speech to the US Congress.46 Within the above-mentioned
context, the documentary’s concomitant focus on Tokyo’s contribution to
China and South Korea’s economic development highlighted Japan’s high-
er moral ground and, not by chance, the documentary showed footage of
the Japan-China Friendship Hospital. This was a facility built thanks to Jap-
anese Official Development Assistance (ODA) that Chinese managers had
recently rechristened as the China-Japan Hospital.47
Heated international crossfire throughout 2015 confirmed the resilience
of the Sino-Japanese «propaganda dilemma». The continued exchange of ac-
cusations, for instance the inclusion of the Nanjing Massacre documents to
the UNESCO Memory of the World Register, implied that the shallow détente
resembled more of a political truce.48 Yet, the underlying structural factor
behind the international and domestic «propaganda wars» was the bilateral
strategic mistrust at a time of power transition. In fact, China’s state-led me-
dia outlets insisted on presenting a Japan that had turned into a source of
instability following the passage of its security laws. For that purpose, Chinese
media availed themselves of distorted and fabricated testimonies of foreign
experts. Two examples help illuminate this aspect. The first is a series of al-
44. Giulio Pugliese, ‘Japan 2014: Between a China Question and a China
Obsession’
45. ‘Full text of Abe’s speech before US Congress’, The Japan Times, 30 April
2015.
46. Ministry of Foreign Affairs of Japan, Communication and Reconciliation in the
Post War Era, 17 May 2015 (http://www.mofa.go.jp/p_pd/pds/page23e_000381.html).
47. In all likelihood, China renamed the facility also for fear of violent nationalist
outbursts. ‘Nippon’s (sic – i.e. «Japan» in Japanese) postwar contribution / «Friendship»
latest casualty at ODA hospital’, The Yomiuri Shinbun/The Japan News, 20 July 2015.
48. ‘Japan hits out as UNESCO archives «Nanjing Massacre» documents’, The
Japan Times, 10 October 2015.
109
Giulio PuGliese
leged statements by Professor Thomas U. Berger of Boston University carried

by state-led news agency Xinhua:
Japan has mostly apologized to South Korea and South-East Asian
countries, but no proper official apology was issued to China. I only
found mentions of China in speeches, and none of them have for main
purpose to give (sic) a genuine apology, mentioning the massacres, ra-
pes, plunder, sexual slavery and biological experiment on live humans.
The emperor has never apologized to China.49
Yet, a request for the academic’s reaction revealed the scholar’s astonish-
ment: «I was never interviewed for Xinhua and I said none of these things!
This is absolutely extraordinary»!50A similar episode involved Dr. Alessio Pa-
talano of King’s College London, whose recorded comments on the signifi-
cance of the 1945 Potsdam Declaration were later edited to imply that Japa-
nese leaders were «turning back on their earlier promises (to forego force as
a tool to solve international disputes)», contrary to the interviewee’s intended
message.51 In a similar fashion, on the anniversary of the Marco Polo Bridge
incident, which marked the beginning of the Second Sino-Japanese War, Xi-
nhua inaugurated a series of special websites devoted to the history issue;
the website commemorating the 70th Anniversary of Victory of the Chinese
People’s Resistance against Japanese Aggression and World Anti-Fascist War
had sleek sections in foreign languages. Interestingly, however, its Chinese-
language equivalent was somewhat sanitized.
Nonetheless, Japanese news media reports failed adequately to recog-
nize that official Chinese-language news media had slightly toned down the
propaganda offensive to pave the way for the 2015 shallow détente. While
indulging in an examination of Japanese wartime atrocities, China’s pro-
paganda apparatus shifted its focus away from the whole of Japan to focus,
instead, on Abe and right-wing politicians as the loci of Japan’s supposed
denial over its brutal historical legacy.52 Strengthened by his new-found do-
mestic clout, in December 2014 Xi Jinping set the language register for the
year ahead. His speech on the occasion of the newly-inaugurated Nanking
49. Alito L. Malinao, ‘News Analysis: Analyst, book slam Japan’s refusal to genu-
inely apologize for World War II crimes’, Xinhua, 20 July 2015.
50. Personal e-mail exchange with Prof. Thomas U. Berger, 21 July 2015.
51. Luan (Editor), ‘Is Japan turning back on own promise?’, CCTVNews, 24 July
2015; Personal e-mail exchange with Dr. Alessio Patalano, 24 July 2015.
52. The best window to Beijing’s history-related propaganda was its newly-in-
augurated multi-language website: ‘Commemoration of the 70th Anniversary of the
Chinese People’s Resistance against Japanese Aggression and World Anti-Fascist War’,
Xinhua, 7 May 2015, (http://www.xinhuanet.com/english/special/jnkzsl/index.htm); A
documentary series titled «Truth and Denial» aptly shows Beijing’s desire to pit Ja-
pan againstGermany and to focus its attention especially on right-wing politicians in
general, and Abe in particular. ‘Truth and Denial’, Xinhua, 7 May 2015 (http://news.
xinhuanet.com/english/video/2015-07/07/c_134386681.htm).
110
Japan 2015
Massacre Memorial highlighted the leitmotifs of the Sino-Japanese «propa-

ganda wars», but with a more nuanced language register that was aimed at
«setting aside hatred and not allowing the minority who led Japan to war
affect current relations». The speech’s strongest passage endorsed the idea
of the event’s remembrance but remained vague, and limited the scope of
Japan’s responsibility: «Forgetting history is a betrayal, and denying a crime
is to repeat a crime. Just because a handful of militarists in a particular na-
tion set off an invasion; war is not a reason for us to hate this nation…but
people shouldn’t at any time forget the brutalities and crimes committed by
the invaders».53 In fact, Xi’s tone during the Nanjing massacre memorial
had markedly softened from his earlier remarks on the same subject.54 In
December 2014, China’s paramount leader emphasized his political will to
partially mend political ties with Tokyo. The event confirmed the dynamics
leading to the frosty Abe-Xi summit choreographed during the November
2014 APEC Summit. Indicative of the somewhat positive trend, Xi decided
not to attend the 2015 Nanjing massacre celebrations.
Thus, on 22 April 2015, the more confident Abe-Xi handshake and bi-
lateral summit on the occasion of the sixtieth anniversary of the Asian-African
Conference in Bandung presaged the primacy of Chinese political and eco-
nomic imperatives over historical sensitivities. In fact, senior Japanese offi-
cials revealed that China insisted on holding the meeting.55 The rationale
had been unveiled in the previous years’ analyses. First, the Abe government
went for the Chinese Communist Party’s economic jugular from the very mo-
ment it initiated its expansionist monetary and fiscal policies under the rubric
of Abenomics. These policies not only shielded Japan from Chinese economic
retaliation, but presented a subtle «beggar-thy-neighbor» edge that boosted,
if temporarily, Japanese domestic consumption and exports. 56 Moreover, the
higher political risks and economic costs of doing business in China con-
tributed to push investment away from the mainland; the Abe government’s
frenetic Asian diplomacy certainly helped to diversify Japan’s Foreign Direct
Investments (FDI) and to spearhead the redirection of Japanese business-
men’s investment away from mainland China. To be sure a Chinese economic
slowdown greatly impacted on Japan too, as testified by a new technical reces-
sion in late 2015, but China’s intensifying woes deeply worried Chinese of-
53. ‘Xi Jinping zong shuji fabiao zhongyao jianghua - Zai Nanjing da tusha
sinan zhe guojia gongji yishi shang de jianghua’ (General Secretary Xi Jinping Deliv-
ered an Important Speech: Speech on the Nanjing Massacre Victims of the National
Mourning Ceremony), Xinhua, 13 December 2014.
54. ‘Speech delivered by the President of the People’s Republic of China, Xi
Jinping to the Körber Foundation’, Körber Stiftung, 28 March 2014 (http://www.
koerber-stiftung.de/en/international-affairs/focus-new-east/xi-jinping-2014/speech-
xi-jinping.html).
55. ‘FOCUS: Impact of Abe’s meeting with Xi much bigger than it looks’, Kyodo
News, 24 April 2015.
56. Giulio Pugliese, ‘Giappone: il ritorno di Abe’ (Japan: Abe’s Comeback).
111
Giulio PuGliese
ficials, who started to publicly acknowledge the risks to social, hence political,
stability.57 Noted US China scholars also started to ring alarm bells in light
of the recent economic and political undercurrents there.58 These dynam-
ics constituted the undercurrents which prompted Premier Li Keqiang’s love
calls to the Japanese business community following the successful summit
with Abe on the fringes of the South Korea-Japan-China trilateral of 1 No-
vember 2015.59 Second, China needed to buoy an increasingly anxious and
militarily assertive neighbor.60 Finally, as per the logic of the East Asian game
of go, China pursued its tactical accommodation with Japan to refocus its
energies on the South China Sea in the belief that Japan would remain quiet.
And so, in May 2015 at a «China-Japan Friendship Exchange Meet-
ing» held at Tiananmen Square’s Great Hall of the People, Xi Jinping
made a surprise appearance to greet with considerable warmth, a 3,000-
men strong delegation of private Japanese visitors with even more explicit
conciliatory messages. Three years after his ascendance to power, Xi made
his first, elaborate, official pronouncement on Sino-Japanese relations and
China’s Japan policy. He aimed at reassuring Japan and preparing the do-
mestic groundwork for a more timid détente when he recalled «the Chinese
people’s profound generosity and infinite kindheartedness; in the immedi-
ate aftermath of the Anti-Japanese War of Resistance we have ‘repaid hatred
with kindness’ (yi de bao yuan) and allowed the repatriation of over one mil-
lion Japanese resident in China, [because] they were also victims of that
war».61 In other words, seventy years after the war Xi was insisting on the so-
called «military-civilian dualism» (ni bunron) which was first expounded by
Nationalist Party leader Chiang Kai-Shek, who held «the Japanese military
clique as the enemy and not the Japanese people».62 The speech signalled
the willingness at the very top to raise public awareness of the importance
of China-Japan relations, stress the positive aspects of Japan and encour-
age cultural exchanges and people-to-people contact. But the transcribed
57. ‘Japan on brink of technical recession’, Financial Times, 30 September 2015;

‘China says needs to ensure economic risks don’t turn into social risks’, Reuters, 31
July 2015.
58. See, for example: David Shambaugh, ‘The Coming Chinese Crackup’, The
Wall Street Journal, 6 March 2015.
59. See, for example: Li Keqiang huijian Riben jingjijie daibiaotuan (Li Keq-
iang Meets a Delegation from Japan’s Economic World), Xinhua, 4 November 2015;
Li Keqiang huijian Riben Shouxiang Anbei Jinsan (Li Keqiang Meets Japanese
Prime Minister Abe Shinzō), Xinhua, 1 November 2015.
60. Giulio Pugliese, ‘Japan 2014: Between a China Question and a China Ob-
session’.
61. ‘Kankei fukuzatsu-ka saseta «itoku hōon» – Sengo 70nen, ima mo tsuduku
tainichi mess ji Sh Kinpei, Ch goku’ («Repaying Hatred with Kindness» Has Made
the Relationship More Complicated – An Enduring Message Aimed at Japan 70 Years
After: Xi Jinping, China), Jiji Tsūshin, 30 July 2015.
62. Barak Kushner, Men to Devils, Devils to Men: Japanese War Crimes and Chinese
Justice, Cambridge: Harvard University Press, 2015, p. 94.
112
Japan 2015
speech also hinted at Xi’s desire to turn the page, an intent made evident
by repeated wording in favour of a forward-oriented outlook for Sino-Jap-
anese relations. One passage embeds this positive message amidst calls for
a proper understanding of history and it is worth citing in full: «China and
Japan should, in the spirit of taking history as a mirror and looking into
the future, jointly promote peaceful development, jointly boost friendship
from generation to generation, and jointly create a good future for the de-
velopment of both countries, so as to make contributions to peace in Asia
and the world at large».63 Xi’s personalized love calls to Japan also cleverly
minimized the legacy of Imperial Japan in the wider context of hundreds
of years of peaceful and fruitful interaction, rather than the 19th and early
20th Century’s unfortunate past. He emphasized Sino-Japanese exchanges
throughout the ages: during the Tang era (618–907 C.E.), the 17th Century,
the post-war period and the future. The Chinese government’s instrumen-
talist and selective use of Sino-Japanese history – trumpeted in this particu-
lar instance as a history of peace and prosperity – was evidence of Beijing’s
need for a more conciliatory policy vis-à-vis Tokyo. The reprint of most of
Xi’s «important speech» as the top news item of the Chinese Communist
Party’s official mouthpiece, the Renmin Ribao, was indicative of Xi’s firmer
political base back home.
At the same time, the Chinese media and propaganda apparatus was in
full swing, making a great fanfare commemorating the 70th anniversary from
the end of the war. Japanese reaction to the same was chilly and reflected the
broader international and domestic structural problems rocking recent Sino-
Japanese relations. As pointed out in last year’s essay, Japan’s domestic media
came to stress the negative side of China’s words and actions, reflecting both
governmental and popular distrust towards Japan’s giant neighbor. In 2015
the slow media reaction to Beijing’s more confident fence-mending overtures
betrayed the lopsided nature of news reporting on all things Chinese. A clear
instance was the widespread failure fully to appreciate Xi’s marked change of
his language register in favor of Sino-Japanese friendship. In fact, most Japa-
nese media tended to emphasize Xi’s limited criticism of the damage brought
by historical revisionism: «the Chinese people cannot forgive words and ac-
tions that distort and beautify the history of Japanese militarist aggression».
That most Japanese media – including the government-friendly NHK – high-
lighted the above passage at the expense of all the aforementioned overtures,
and that virtually all of them had rendered the Chinese for «cannot allow»
(burong) into the sterner worded «cannot forgive», was symptomatic of the
media’s structural problems and of the underlying suspicion of China’s Janus-
63. Xi Jinping chuxi Zhong-Ri Youhao Jiaoliu Dahui bing fabiao zhongyao ji-
anghua (Xi Jinping attended the China-Japan Friendship Exchange Meeting and
delivered an important speech), Renmin Ribao, 24 May 2015. Xi Jinping zai Zhong-Ri
Youhao Jiaoliu Dahui shang de jianghua (Speech Delivered by Xi Jingping at the
China-Japan Friendship Exchange Meeting), Xinhua, 23 May 2015.
113
Giulio PuGliese
faced tactical accommodation.64 At any rate, this event and its resonance in
China’s official state-run media displayed clear willingness from the top to
mend ties with Japan, even if only out of political and economic necessity.
At the same time, it is worth stressing that Xi was neither all-powerful
nor willing to steer the domestic propaganda machine towards a meaning-
ful détente. The above limited love calls were, in fact, a drop in an endless
ocean of nationalist fanfare in this historical year, the very same fanfare
that central and local governments had insisted upon since the flaring up
of the Senkaku/Diaoyu islands dispute in the summer of 2012. In other
words, there were minor adjustments in the media discourse, but China’s
change in tone needs to be taken in the context of continuing anti-Japanese
sentiment. Chinese traditional media dutifully emphasized criticism of Abe,
rather than the whole Japanese polity, to pour cold water on an already in-
censed and nationalistic domestic audience. That is, it aimed at preparing
the groundwork for a working level Sino-Japanese truce with the prospect
of a deeper détente with Abe’s successor. Moreover, the Xinhua and CCTV
websites devoted to the 70th Anniversary of the end of World War II stressed
China’s «victorious» narrative compared to its markedly more «victimized»
tone in previous years.65 However, they continued to make the simplistic
comparison between an unrepentant Japanese polity, with specific reference
to right-wing politicians, and Germany’s penitence; a recurring reference to
this was reflected in the websites’ layout and condensed in a documentary
called «Truth and Denial».66
According to direct testimony from a European Union diplomat, in the
run up to the 70th Anniversary celebrations the Propaganda Department
Education Bureau flooded the city of Beijing with billboards advertising the
Chinese Communist Party’s fight in the global war against fascism. These
posters succinctly hinted at the dominant historical narrative of a CCP-led
liberation. Here the Nationalist Party (Guomindang, GMD) was hardly men-
64. ‘Sh Shuseki: «Rekishi waikyoku suru gendō yurusanai»: Nikai-shira hoch -
dan Sh Kinpei Kokka Shuseki to menkai: Abe Shushō ni yoroshiku to’ (Chairman Xi:
«Historical Distortions are Unforgivable» – President Xi Meets China-Visiting Group
Led by Nikai: Send My Greetings to Abe), NHK News, 23 March 2015. ‘Nikai-shi
hoch Sh -shi no tainichi kaizen shisei wa honmono ka?’ (Nikai’s Visit to China – Is
Xi’s Softened Stance vis-à-vis Japan for Real?), Yomiuri Shinbun, 26 May 2015.
65. ‘Jinian shijie fan faxisi zhanzheng shengli 70 zhounian’ (Commemoration
of the 70th Anniversary of the World Anti-Fascist War), Xinhua, May 2015 onwards;
‘Zhongguo renmin kangri zhanzheng ji shijie fan faxisi zhanzheng shengli 70
zhounian’ (70th Anniversary of the Chinese People’s Victorious War of Resistance
Against Japan and World Anti-Fascist War), Xinhua, July 2015 onwards (http://news.
cntv.cn/special/kzsl70zn/index.shtml).
66. ‘Truth and Denial’, Xinhua, 7 July 2015; in Chinese: ‘Guangming yu yin-
mai: De-Ri Erzhan fansi lu’ (Light and Shadows: Documents of Germany and Japan’s
Introspection over World War II), July 2015 (http://jishi.cntv.cn/special/djsb/drezfsl/
index.shtml).
114
Japan 2015
tioned, apart from «CCP and GMD cooperation» (guo gong hezuo), and the
Allied forces barely figured, apart from intelligence cooperation and Japan’s
signature of the instruments of surrender on the USS Missouri on 2 Septem-
ber 1945. At the same time, careful reading of the dazibao and of the long
red banners plastered over various sites in Beijing confirmed that China was
now insisting on a «victorious» storyline, rather than a «victimized» one.67
Moreover, the end of the seven-paged dazibao hinted at Beijing’s willingness
to tone down present-day Sino-Japanese acrimony; it detailed Xi’s earlier
speech to the China-Japan Friendship Exchange Meeting along with the
Politburo Standing Committee’s visit on 7 July 2015 to the Anti-Japanese
War of Resistance Museum. Yet, it was no mistake that the so-called «China
Seven», the members of the Standing Committee of the CCP Politburo, were
shown visiting a room devoted to Japanese atrocities committed on Chinese
soil.68 China was ready to move on but the state-sanctioned narrative made
sure to pander to popular sensitivities.
In fact, on multiple occasions high-ranking Chinese government offi-
cials prioritized the history issue to reset Sino-Japanese relations. Xi’s state-
ments during his April bilateral meeting with Abe made absolutely clear the
need to cater to China’s historical sensitivities: «The history issue is a funda-
mental matter of principle, a matter that lies at the political foundation of
China-Japan relations».69 To these calls Abe Shinz half-heartedly responded
through his 14 August government-backed statement.
3.1. The Sino-Japanese truce II: Abe’s «History Statecraft»

and the Abe statement
As the Chinese and Japanese war of words over the history issue toned
down but simmered throughout mid-2015, it looked as if the frosty Sino-
Japanese rapprochement would come under considerable stress by late
summer, when Japan and its Asian neighbors commemorated the 70 years
since the capitulation of the Japanese Empire. As recounted, a new powerful
stream of Chinese propaganda aimed at memorializing the second Sino-
Japanese war presaged a testy season.
Yet, Abe and Yachi’s «history statecraft» followed the 2006 model, the
year when Tokyo and Beijing inaugurated the Strategic Mutually Beneficial
Relationship following a highly choreographed exchange of signals betwe-
en the two governments. The key premise now, as then, was reciprocity: a
conciliatory «Abe Statement» sought somewhat to assuage China’s historical
67. Private pictures of streets in Beijing in the months before and after Victory
Day presented to the author, available upon request.
68. Ibid.
69. Ministry of Foreign Affairs of the People’s Republic of China, Xijinping hui-
jian Riben Shouxiang Anbei Jinsan (Xi Jinping Meets with Prime Minister Abe Shinzō of
Japan), 22 April 2015 (http://www.fmprc.gov.cn/mfa_chn/zyxw_602251/t1256984.shtml).
115
Giulio PuGliese
sensitivities, but emphasized postwar Japan’s positive role and its further
contribution to peace in line with the Premier’s ideology; in turn, Beijing
ignored the lack of specific apologies (owabi) and echoed Japan’s forward-
looking attitude towards resuming the moribund Japan-China Strategic
Mutually Beneficial Relationship. MOFA’s short movie on post-war Japan-
China relations had already hinted in mid-2015 at the way forward for bila-
teral relations, according to Tokyo.70
In turn, the Chinese authorities quietly watered down the overtly jin-
goistic aims of the newly established 3 September military parade. As of Ja-
nuary 2015, according to a popular blogger writing for the Renmin Ribao so-
cial network, the purposes of the parade were to: «showcase China’s military
strength; frighten Japan for the sake of maintaining the post-war order; uni-
te the people’s confidence and pride; and showcase the PLA’s discipline».71
By June 2015, however, these goals had turned into: «Showcase China’s
determination to take the road of peaceful development; showcase its po-
sition of defending its national sovereignty; show its great sacrifices during
the war; push forward the modernization of the PLA».72 In all likelihood
Chinese policymakers also understood the negative international spillover
effects of its bombastic anti-Japanese campaigns, but it was too late: many
Western governments decided not to send heads of governments to such
bombastic celebrations.
Preliminary evidence suggests that Washington was pressing to bring
about a degree of stability between Japan and its North-East Asian nei-
ghbors over the «history issue». Brad Glosserman, executive director of the
US-based Pacific Forum Center for Strategic and International Studies think
tank, testified to such pressure regarding the Abe Statement in an e-mail
exchange: «I have been in meetings when I and others pressed government
of Japan representatives to take that extra step and I have been told by
US government representatives that they did the same».73 As recounted in
previous essays, similar US pressure contributed to a moratorium to the
history-related acrimony between Japan and China starting with the first
Abe administration, including a seven-year moratorium to the disputes over
Yasukuni Shrine visits by sitting prime ministers. Washington’s aims were
consistent throughout: policymakers wanted a stronger Japan, but not at
70. Ministry of Foreign Affairs of Japan, Japan-China Relations: Towards a Mutu-

ally Beneficial Relationship Based on Common Strategic Interest, 17 May 2015 (http://www.
mofa.go.jp/p_pd/pds/page23e_000381.html).
71. ‘Guanfang queren zhongguo jinnian juxing yuebing shouci you waiguo
shounao chuxi’ (Officials Have Confirmed That China Will Hold Military Parade
This Year – Foreign Leaders will Attend), Renminwang, 27 January 2015 (http://poli-
tics.people.com.cn/n/2015/0127/c1001-26455755.html).
72. State Council Information and Press Office press release, 23 June 2015.
73. E-mail exchange with Brad Glosserman, Executive Director of Pacific Fo-
rum CSIS, 8 December 2015.
116
Japan 2015
the cost of entrapment into Sino-Japanese military or history issues-related

brinkmanship.
At the same time, there was a key difference between 2006 and 2015:
Japan was not negotiating from a position of undeniable politico-economic
strength vis-à-vis China. China did not pursue a fuller accommodation to-
wards Japan for this reason. By 2015, Chinese policymakers probably thou-
ght that time was on their side in the medium to long term, and they did not
need to make considerable concessions to Tokyo, only buy time. Confident
of Japan’s military potential, emboldened by the new US-Japan security gui-
delines and probably betting on China’s deepening economic woes, Abe was
not interested in making meaningful concessions to China either.
At any rate, the history issue was a major hurdle in resetting a working
level relationship and the Japanese and Chinese governments needed to
find a working-level agreement to defuse it. In fact, since the history issue
had become a matter of international and domestic politics, the Japane-
se government had set up a public advisory panel on the occasion of the
August statement commemorating the end of World War II. This was the
Advisory Panel on the History of the 20th Century and on Japan’s Role and
the World Order in the 21st Century (abbreviated in Japan as «21st Cen-
tury Advisory Panel»). Since previous statements suffered from substantial
domestic rebuttals and lukewarm acceptance from Japan’s neighbors, the
variegated advisory panel crafted a report that explicitly aimed at building
domestic consensus and international support.74 In other words, the report
and accompanying statement constituted an implicitly political communi-
cation effort designed to reassure international and domestic audiences that
«Japan’s post-war trajectory is based on a thorough reflection on its actions
in the 1930s and the first half of the 1940s».75 The international and dome-
stic buzz surrounding the declaration of Japan’s conservative Prime Mini-
ster testified to the political need to dispel diffuse anxieties and win support
for Japan and its leadership. These anxieties were all the more felt by Abe
because of China’s earlier successes in putting the spotlight on the Premier’s
ill-concealed revisionist colors, and in light of Abe’s main priority: passing
the embattled security bills. As recounted earlier, the Obama administration
interceded to avoid a new row between Japan and its neighbors and likely
exacted promises from Abe on that front.
74. ‘Keiō Dai Hosoya-shi «Baransu tore sandō erareru naiyō»’ (Keiō University
Hosoya: «Balanced Content will Meet with General Approbation»’), NHK 7ji News,
6 August 2015; ‘Soko ga kikitai: sengo 70nen danwa – Kitaoka Shinichi-shi’ (That’s
What I’d Like to Inquire About: Statement Commemorating 70 Years from the End
of WWII – Mr. Kitaoka Shinichi), Mainichi Shinbun, 3 June 2015.
75. Prime Minister of Japan and His Cabinet, Report of the Advisory Panel on the
History of the 20th Century and on Japan’s Role and the World Order in the 21st Century,
Tokyo, (https://www.kantei.go.jp/jp/singi/21c_koso/pdf/report_en.pdf), August 2015,
p. 12.
117
Giulio PuGliese
Thus, the end product was an overarching document that did not shy
away from highlighting Japan’s «reckless war», «colonial rule» and «aggres-
sion», key words from previous Statements that aimed at assuaging the hi-
storical sensitivities of victimized neighbors, the United States and of pro-
gressive forces within Japan; in a jab against Abe’s and Japanese historical
revisionists’ personal credo, the report spelt out that «it is inaccurate to
claim that Japan fought to liberate Asia as a matter of national policy».76 But
it was evident that the commission fumbled over some definitions and de-
tails due to internal disagreement, possibly as a means of leaving room for
politically-expedient ambiguity. For instance, in another passage the report
contradicts the above-statement and panders to the revisionist readership:
«Whether or not Japan intended to liberate Asia, it did wind up promo-
ting the independence of the colonies in Asia». Positive reception of the re-
port’s language by newspapers spanning Japan’s political spectrum testified
to such ambiguities: notoriously conservative Sankei Shinbun highlighted
the latter passage, while progressive media outlets praised the inclusion of
other key words, such as «aggression» (the translation used for shinryaku,
more commonly translated as «invasion»).77
In fact, Japanese historical revisionists traditionally sought to mini-
mize Japan’s responsibility. They euphemistically referred to aggression as
«advancement» (shinshutsu) and denied that the colonization of Korea could
be described as an invasion. For these reasons, the inclusion of «aggression»
(shinryaku) appeared with reference to Japan’s encroachment into China
and was accompanied by a cumbersome footnote that described the internal
disagreement over its usage. Wording further on in the report highlighted
the very same dynamic: «[There is a 1974] UN General Assembly Resolu-
tion on the Definition of Aggression, but (emphasis added) there are some
who point out that the international community has yet to reach a complete
consensus». This was another indication that the report was directed at the
widest possible domestic audience at the cost of watering down its most
conciliatory wording.
The report had a whole section that compared Japan’s historical recon-
ciliation with those who had been victims of its aggression, and hinted at the
76. Ibid., p. 6.
77. ‘«Rekishi ninshiki de Kankoku ga gōru ugokashita», «aikokushugi kyōka shi-
ta Ch goku ga kōiteki de nakatta» – seifu kankei bunsho de irei no fumikonda hyōgen’
(‘«South Korea Moved the Goalpost in the History Issue», «Through Strengthened
Patriotic Education China did not Respond Favorably to Japan» – a Government-Re-
lated Document Replete with Unprecedented Expressions), Sankei Shinbun, 7 August
2015; ‘Sengo 70nen danwa – wakai he no mess ji wo’ (The Statement on Occasion
of the 70th Anniversary of End of World War II: a Message of Reconciliation), Asahi
Shinbun, 7 August 2015; ‘Ch moku ny su 90byō sengo 70nen danwa y ishikisha kaigi
hōkokusho’ (Hot News in 90 seconds – Blue Ribbon Panel Report for the Statement
on Occasion of the 70th Anniversary of the End of World War II), Mainichi Shinbun
Videos, 6 August 2015, (http://mainichi.jp/movie/movie.html?id=891968982002).
118
Japan 2015
way forward for Japan-China relations. Not by chance, this section echoed
the Chinese government’s marked change of language register: «China has
maintained ‘military-civilian dualism’ after the end of the war. As Premier
Wen Jiabao stated in his speech before the Japanese Diet in 2007, Chi-
na made clear its stance of appreciating Japan’s remorse and apology over
the war, which was expressed in the Murayama Statement and the Koizu-
mi Statement». Yet, two panel members usually close to Abe were against
the use of «aggression» to define Japanese encroachment into China.78 In
exchange for Abe’s recognition of Imperial Japan’s culpability, China would
drop requests for words of «apology» (owabi). Acting chair of the advisory
panel Kitaoka Shin’ichi stressed that «what is important here is reflection,
not apology. [because] Japan has apologized many times and the countries
concerned have accepted in most cases».79 It was time to reflect on Japan’s
positive and negative legacy and turn the page.
Thus, the aim of Abe’s «history statecraft» was not full-fledged recon-
ciliation, but tit-for-tat reciprocity that avoided the politicization of the
history issue and altogether curtailed major provocations in the sensitive
year of 2015. As recounted in last year’s essay, this likely meant avoiding a
Yasukuni Shrine visit until the end of Abe’s mandate and the Abe Statement
was a chess piece used by Beijing and Tokyo to sell a very timid cold peace.
Yaming Tang, Head of the Society of Chinese Professors in Japan, testified
to the logic of the Abe Statement: «Behind the scenes China has already
agreed to specific wording in the Abe Statement, but the core message has
been watered down to Abe’s personal message. In fact, the final wording will
water down the Murayama and Koizumi Statements, but it won’t provoke
China».80
For these reasons, on 14 August 2015, Abe was sending clear messa-
ges to China, when he stated that «we must squarely face the history of
the past» and praised the tolerance of post-WWII China. The passage is
worth quoting in full: «How much emotional struggle must have existed
and what great efforts must have been necessary for the Chinese people who
underwent all the sufferings of the war and for the former Prisoners of War
who experienced unbearable sufferings caused by the Japanese military, in
order for them to be so tolerant nevertheless?» Abe was echoing Xi Jinping’s
earlier reminder of Chinese generosity, one that «repaid hatred with virtue».
78. ‘Japan in Depth / Most panel members share history view’, The Japan News,
7 August 2015.
79. Shinichi Kitaoka, ‘Insights into the world - Separate historical perceptions,
apology’, The Japan News, 8 June 2015.
80. Interview with Yaming Tang, Head of the Society of Chinese Professors
in Japan, 30 July 2015. The 1995 Murayama Statement and 2005 Koizumi State-
ment are listed in MOFA’s webpage dedicated to the Japanese government’s efforts
at historical reconciliation: Ministry of Foreign Affairs of Japan, ‘Issues Regarding
History’(http://www.mofa.go.jp/policy/postwar), 26 November 2015.
119
Giulio PuGliese
These soothing words were diplomatic signaling at work; the aim being the
resumption of a working-level relationship.
Moreover, it is worth noting that Abe did soften his historical revisionist
credo. The use of so-called «key words» hinted at a political compromise at
home. Members of his Cabinet were often affiliated with intra-LDP natio-
nalist groups, some of which wholly misrepresented Imperial Japan’s acts
of aggression as noble missions to liberate Asia.81 Faced by mounting in-
ternational and domestic pressure, Abe aborted earlier attempts to rescind
or hollow out the Murayama and Kōno Statements. Concerning Imperial
Japan’s legacy in Asia, the Murayama statement had become the gold stan-
dard of that contrition. This was certainly the case in China, and South
Korea, but also among the vast majority of Japanese citizens. One public
opinion poll confirmed the overwhelming popular desire to uphold the so-
cialist Prime Minister’s statement.82 For these reasons, and in the face of
sinking approval rates due to the passage of the embattled Security Bills,
Abe hinted approval of progressive forces and catered to the sensitivities of
his coalition partner.
But Abe certainly watered down the spirit of previous statements becau-
se he was appealing to too many audiences: the US, China, and all of Japan,
and that included the nationalists. During the highly-choreographed press
conference that followed the Statement Abe provided journalists with the
Statement’s exegesis. There he recognized the primacy of domestic consi-
derations: «I wanted to write a statement that was shared by many Japanese,
a statement that should be read as a whole and from a broad perspective».83
For these reasons the statement toed the 21st Century Advisory Panel’s line,
the «voice of history» in Abe’s own words, for even more politically-expe-
dient ambiguity. For instance, whereas the then-controversial Murayama
statement explicitly blamed Japan’s «colonial rule and aggression [in the
not too distant past]», Abe pledged to renounce aggression and colonial
rule in the future.84 A few minutes later he explicitly linked «aggression» to
the 21st Century Advisory Panel’s report, where the word referred to Japan’s
encroachment of China into Manchuria. At the same time Abe was ambi-
81. See for instance: ‘Dai san-ji Abe Naikaku Kakuryō no «Nippon no Zento to
Rekishi Kyōiku wo Kangaeru Wakate Giin no Kai» sankasha (Members of the «Young
Diet Members Committee to Consider the Future of Japan and History Education»
who are part of the Third Abe Government), Shūkan Kinyōbi, 9 August 2015.
82. ‘(Sengo 70nen) Murayama, Koizumi Danwa «datō» 74% Asahi Shinbun
Yoron Chōsa’ (70th Anniversary from the Post-war: 74% of Respondents Consider Mu-
rayama and Koizumi Statements «Appropriate»), Asahi Shinbun, 14 April 2015.
83. Prime Minister of Japan and His Cabinet, Abe Naikaku Sōri Daijin Kisha Kai-
ken (Press Conference of Prime Minister Abe), 14 August 2015 (http://www.kantei.
go.jp/jp/97_abe/statement/2015/0814kaiken.html).
84. Ministry of Foreign Affairs of Japan, Statement by Prime Minister Tomiichi Mu-
rayama «On the occasion of the 50th anniversary of the war’s end», 15 August 1995 (http://
www.mofa.go.jp/announce/press/pm/murayama/9508.html).
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Japan 2015
valent on specifics: «it is historians’ responsibility to define what constitutes

and what doesn’t constitute aggression».85 That is, by Abe’s own unintended
acknowledgement, the statement included ill-defined key words. Thus, the
government-backed policy statement presented shaky historical founda-
tions and its alleged author walked the tightrope of ambiguity in order to
cater to the sensitivities of too broad a target on that front.
At any rate, and differently from the speeches given in Washington
and in Jakarta at the 60th Asia-Africa Summit, Abe spelt out some of the
keywords from previous declarations of contrition: «aggression», «colonial
rule», and «apology». The domestic media agenda had set the words up as
a litmus test to grade Abe’s statement against the previous ones. Thus, the
cabinet-approved policy document emphasized «feelings of profound grief»
and recognized the «unshakeable position» of past Japanese apologies, but
Abe provided another piece of the puzzle when he said he abided by the
«unwavering spirit of apology» (yuruginai owabi no kimochi) of previous de-
clarations. Progressive media outlets positively reported the news, although
the editorial bureau of the same outlets, such as Asahi Shinbun, sternly re-
butted its line.86 Abe had come a long way from his earlier, public disavowal
of the 1995 Murayama Statement. On that occasion he had left the Diet
Building with other MPs so as to impede its passage as a Diet Resolution
through unanimous vote.87 National and political interests contributed to
preserving an ambiguous consensus on previous government declarations.
At the same time, the statement reflected Abe’s personal outlook. First,
it betrayed his aspiration for Japan to outgrow what he understood as ma-
sochistic acts of contrition. An early draft of Abe’s initial posturing on the
Murayama and Kōno statements opens a window to the Prime Minister’s
«future-oriented» thinking. Given the documentary value of the roughly-
sketched draft, one that allows a comparison between Abe’s personal ambi-
tions in late 2012 and the realities of political compromise once in office, it
is worth quoting in full:
«Do you follow through (tōshū), or not? Yes or no? Prime Ministers of
Japan have been presented with simple binary options with regard to the
Murayama and Kōno Statements. But History contains instances of glory
and disgrace, instances to treasure with pride and instances to treasure as
admonition. I can say only one thing: Japan intends to build relations with
neighboring countries such as South Korea and China in order to share the
fruits of prosperity. I am earnestly devoted to the future, because the Japan
85. Prime Minister of Japan and His Cabinet, Abe Naikaku Sōri Daijin Kisha Kaiken
86. ‘Survey finds Abe Cabinet support rating at 43.2%, up 5.5% from July’, The
Japan Times, 15 August 2015.
87. ‘Abe-shi wa Kokkai Ketsugi wo kesseki, Murayama Danwa wo ketsudan
95nen’ (Abe was Absent during Diet Resolution, Murayama opted for the 1995 Gov-
ernment-backed Statement), Asahi Shinbun, 4 March 2015.
121
Giulio PuGliese
of 30 years from now will bring peace and prosperity and I intend to move
forward and pursue these objectives with my heart and soul».88
Three years later, Abe’s pledge of looking to the future and his va-
riegated, if ambiguous, overview of the past was intact in his Statement’s
most-relevant passage: «We must not let our children, grandchildren, and
even further generations to come, who had nothing to do with that war, be
predestined to apologize. Still, even so, we Japanese, across generations,
must squarely face the history of the past. We have the responsibility to
inherit the past, in all humbleness, and pass it on to the future». In the
summer of 2015, the main speechwriter would remain the same as for the
afore-mentioned draft, and so too would the gist of the message. Abe-colors
were on full display.
Secondly, the statement superficially echoed, almost verbatim, the Chi-
nese government’s politically-charged calls for Japan to «squarely face the
history of the past». But it did so with an implicit, if recurrent, desire to
highlight the identity chasm between a virtuous post-war Japanese «Self»
against an aberrant pre-war «Other» that often resembled present-day Chi-
na. The present-day «Self» upheld the surrounding international order, whi-
le the pre-war «Other» challenged it. Abe’s introspection on the «mistaken
road to war» taken in the 1930s sounded very much like a warning to Bei-
jing, not least because of its added emphasis: «Japan gradually transformed
into a challenger to the new international order that the international commu-
nity sought to establish». The statement’s concluding passage confirmed the
Premier’s insistence on the identity chasm rooted in the power politics of Si-
no-Japanese rivalry. Since the narratives highlighted in last year’s essay were
clearly emphasized, the statement is worth citing in full: «We will engrave in
our hearts the past, when Japan ended up becoming a challenger to the in-
ternational order. Upon this reflection, Japan will firmly uphold basic values
such as freedom, democracy, and human rights as unyielding values and, by
working hand in hand with countries that share such values, hoist the flag of
Proactive Contribution to Peace, and contribute to the peace and prosperity
of the world more than ever before». China was certainly not a member of
the club and, given its persistent refusal to go before international arbitra-
tion with its territorial disputes in the East and South China Seas, it started
to look like a challenger of said «international order». The statement’s intri-
guing mix of soothing words and veiled antagonistic discourses confirmed,
one more time, that Abe’s resolute stance was unwavering.
To sum up, the statement hinted that the Sino-Japanese détente was
very timid indeed. It thoroughly underlined contemporary Japan’s identity
as a peace-loving, rule-abiding state that upheld the status quo and that did
not intend to resort to coercion. This was an implicit message to domestic
88. Participatory observation at «Yachi juku» training camp (gasshuku), Komaba,

9 December 2012.
122
Japan 2015
and international audiences that there was a big difference between today’s
Japan and China. Antagonism was alive and well. Together with the White
House’s public endorsement of Abe’s words,89 it became evident that the
Sino-Japanese cold peace was staged on the solid, but rapidly shifting, tec-
tonic plates of power politics.
4. The Structural Picture: Enduring Rivalry in the Regional Game of Go
Although China and Japan staged a modest rapprochement, this did

not alter the structural picture, characterized by deepening rifts in the mi-
litary, economic and communication arenas. In fact, the mid-summer cre-
scendo in the regional game of go triggered a new wave of negative Chinese
propaganda that may have gone beyond the central government line. Chi-
na’s state-run media was deviating from Xi’s line to lament a lack of specific
wording of contrition in the upcoming Abe Statement: «because hansei (i.e.
«self-reflection», but translated in English as «remorse») is not synonymous
with owabi (i.e. «apology»). If Abe opts for that wording, his statement will
constitute a serious dilution of the 1995 Murayama Statement offered on
the occasion of the 50th Anniversary of the end of the war». The above edi-
torial was all the more alarming because it was carried by the Renmin Ribao,
and it did so when the Party leadership as usual retreated to the ritual secre-
tive summer meeting at Beidaihe.90 It is worth noting that the chasm betwe-
en the quiet bilateral agreement and state-led propaganda preoccupied one
of the members of Abe’s Commission on a Framework for the 21st Century.
According to him, it looked as if Beijing was moving the goalpost for timid
détente only one week before the landmark statement.91 Yet, it was also true
that Japan was unwavering in its commitment to deter and publicize Chine-
se assertiveness in the South China Sea. The August anti-Japan crescendo
was also a reaction to Japan’s «meddling» in what China understood as its
neighborhood. The logic of the regional game of go trumpeted shallow
engagement in 2015.
Indeed, according to an influential Chinese academic based in Japan,
who would later attend the September 3 parade, China was indeed accom-
modating but Japan was hardening its position. He qualified the Japanese
government’s position over the SCS as provocation and lamented Japan’s
89. The White House, Statement by NSC Spokesperson Ned Price on Japanese Prime
Minister Abe’s Statement on the 70th Anniversary of the End of World War II, 14 August 2015.
90. ‘Anbei tanhua: san ge guanjian ci buke huo que’ (Abe Statement: Three
Words are Indispensable), Renmin Wang, 3 August 2015; Rumors spread that authori-
ties had called off the meeting in 2015, but China’s state agency reported otherwise:
‘Summit season begins in Beidaihe for China’s Communist Party leaders’, South China
Morning Post, 5 August 2015.
91. Note posted online on 5 August 2015.
123
Giulio PuGliese
increasingly rock-solid stance on the Senkaku Islands, including Abe’s deci-

sion to make repeated reference of these in school textbooks.92 Yet, China’s
continued presence in the East China Sea and its inauguration of a mam-
moth coast guard ship, the Zhongguo Haijing 2901, destined for that theater,
indicated that Beijing was also unwilling to shelve the issue.93 In addition,
a bombastic new recruitment video for the People Liberation Army’s Navy
was a powerful reminder of China’s maximalist stance over its multiple ter-
ritorial disputes and of its hyper-nationalistic narratives.94 According to a
Council on Foreign Relations blog, the PLA was behind the release of a
new computer-generated video on September 3, China’s Victory Day. The
video had a telling title, «Battle to Capture an Island: a Full View of Chinese
Military Strength»,95 and it showed China’s crushing defeat of what looked
like US military forces based in China’s proximity, seemingly on Japan’s
Okinawa islands. China had no claims on the islands, but the Renmin Ribao
did come up with an editorial in 2013 that disputed Japan’s sovereignty the-
re.96 That particular detail and the closing line to the short movie presaged
a bumpy road ahead for the regional strategic game of go, where no party
was willing to make substantial concessions: «We wholeheartedly love peace,
but must be prepared for the likelihood of war. We respectfully and solemnly
commemorate the 70th anniversary of the war against Japan». That they
decided to commemorate it with a bombastic animated video in addition to
a raw display of military artillery and marching soldiers was symptomatic of
China’s underlying jingoistic attitude.
In other words, Beijing defused confrontations with an increasingly
assertive Japan only halfheartedly. It was, however, quite possible that po-
werful opposition within the CCP was endeavoring to shake Xi’s qualified
conciliatory stance vis-à-vis Japan in order to score political points and de-
92. Interview with Yaming Tang, Head of the Society of Chinese Professors
in Japan, 30 July 2015. With regard to reference to the Senkaku/Diaoyu Islands in
school textbooks: Giulio Pugliese, ‘Japan 2014: Between a China Question and a
China Obsession’, pp. 85-86.
93. Ryan D. Martinson, ‘East Asian Security in the Age of the Chinese Mega-
Cutter’, Center for International Maritime Security, 3 July 2015 (http://cimsec.org/east-
asian-security-age-chinese-mega-cutter/16974).
94. Andrew S. Ericson, ‘«This is the Chinese Navy!» – PLAN Ad Video Re-
cruits Millennials with Patriotic Appeal’, 11 August 2015 (http://www.andrewerickson.
com/2015/08/this-is-the-chinese-navy-plan-ad-video-recruits-millennials-with-patri-
otic-appeal).
95. Lauren Dickey, ‘Chinese Animators Envision a Future Asia-Pacific War
and Blow Up the Internet’, Council on Foreign Relations (http://blogs.cfr.org/david-
son/2015/09/03/chinchinese-animators-envision-a-future-asia-pacific-war-and-blow-
up-the-internet); original video available at: http://news.qq.com/zt2015/ddzy/index.
htm?tu_biz=1.114.1.0.
96. Cong guoji tiaoyue shijiao lun Diaoyudao zhuquan guishu Zhongguo (Di-
aoyu Islands Sovereignty Belongs to China from an International Perspective on the
Treaty), Renmin Ribao, 15 August 2015.
124
Japan 2015
legitimize his rule. Jiang Zemin’s notoriously anti-Japan «Shanghai faction»

had proved a major foe against the accommodating Hu Jintao administra-
tion back in 2005 and it needed to consolidate power at home prior to
introducing the 2006 détente.97 In August Xi sent coded threats to Jiang
through the Renmin Ribao to impede his meddling in Chinese politics.98 At
any rate, only time will tell what role Japan played in the intra-party factio-
nal turf wars following the 2012 nationalization. No matter how firm Xi’s
grip on power looked from a distance, the Japan-bashing discourses proved
incredibly resilient in this historical year, and the very same Xi Jinping ad-
ministration’s earlier ignition of the «Japan-bashing» propaganda machine
unleashed a nationalistic tiger it proved unable to dismount. Xi was unable
to dismount this anti-Japan beast even if he wanted to; in the author’s view,
he was unwilling to wholeheartedly defuse bilateral acrimony and pursued,
instead, a tactical accommodation to buy China time and much-needed eco-
nomic resources and military capabilities. Xi was a nationalist himself.
Indeed, evidence of a deepened geopolitical realignment among
longstanding partners - between China and Russia on one side, and the US
and Japan and others, such as Australia and India, on the other - provided
another indication of the gathering storm clouds in the region. 2015 saw a
full-blown rise of joint naval drills in the Indo-Pacific; these were directed
towards enhancing interoperability, deterring adversaries and reassuring
domestic constituencies, but their sheer quantity, increasedtempo and num-
ber of actors involved betrayed the action-reaction dynamics of a region-
wide security dilemma. Prior to the September 3 military parade, Russian
and Chinese navies held their largest joint naval exercises in history, Joint
Sea 2015 II. Twenty-two vessels, 20 aircraft, 40 armored vehicles and 500
marines engaged in anti-submarine, anti-aircraft and anti-ship exercises. It
was a first for China, which had never engaged in a joint naval drill in that
theater before. A further indication of deepening bilateral military ties was
the first-ever joint amphibious operations on Russian territory off Vladivo-
stok.99 These military exercises are likely to become more common and echo
regional noises. For example, the Japanese Navy joined the India-US Mala-
bar naval exercises in the Gulf of Bengal as a regular participant100 Notably,
Japan’s more forceful pronouncements in favor of engagement in the South
China Sea were accompanied by other joint exercises clearly aimed at de-
97. Christopher R. Hughes, ‘Japan in the politics of Chinese leadership legiti-

macy: recent developments in historical perspective’, Japan forum, Vol. 20, No. 2,
2008, pp. 245-266.
98. ‘Stop meddling in politics: Chinese President Xi Jinping’s coded message to
Jiang Zemin’, South China Morning Post, 11 August 2015.
99. ‘Russia, China kick off active phase of Sea of Japan naval drills’, RT, 24 Au-
gust 2015 (https://www.rt.com/news/313170-russia-china-japan-sea-drills).
100. ‘India shuns China, allows Japan in Malabar naval drill’, The Times of India,
13 July 2015.
125
Giulio PuGliese
terring China from meddling with its neighbors. It sent a small contingent
to large-scale joint US-Australia exercises, it engaged in bilateral drills with
the Philippines Navy and later, the US Navy, in waters adjacent to the hotly
contested Spratly Islands. It also participated in a multi-nation exercise with
the intention of reclaiming remote islands.101 The burgeoning expansion
of scope and deepening intensity of military drills from both camps hinted
that it was still too early to talk of any Sino-Japanese rapprochement worthy
of notice.
Military trends provided another indication of rising tensions, again
evidenced by action-reaction dynamics in naval and constabulary military
procurements. Specific to Sino-Japanese relations, the budding East China
Sea «security dilemma» had not yet evolved into a naval arms race, but a
«naval constabulary forces race» in which Japan responded to China’s afore-
mentioned mammoth Coast Guard ship, the first of two, by considering the
redeployment of coast guard vessels to docks closer to the Senkaku/Diaoyu
Islands and ECS choke points.102 Previously, the central government had
also moved forward with its plan to establish a Ground Self-Defense Force
surveillance station and garrison on the remote Yonaguni Island.103 Mo-
reover, the Japanese Coast Guard made a budget request for a near-record
204 billion yen in the 2016 fiscal year, 10% up from the year before.104 In
fact, the CGS procurement did not fall into Japan’s much-vaunted 1% to
GDP ceiling for its annual military budget.105 Finally, the Japanese military
planners aimed at «stringing a line of anti-ship, anti-aircraft missile batte-
ries along 200 islands in the East China Sea stretching 1,400 km from the
country’s mainland toward Taiwan».106 Thus, while defensive in character,
operations on that front increasingly reflected the common characteristics
of an arms race: they were driven by international imperatives; they were
bilateral in scope; intense in rapidity and expression; they were associated
with ongoing high political tension; they were operationally specific and
101. ‘Talisman Sabre: Trying to deter China’, Military Times, 26 July 2015; ‘US,
Japan Join Philippines in Navy Drills Near South China Sea’, Bloomberg News, 22
June 2015; Ankit Panda, ‘A First: Japanese and US Navies Hold Exercise in South
China Sea’, The Diplomat, 31 October 2015; ‘Japanese troops attack California island
in training exercise with US forces’, Asahi Shinbun, 3 September 2015.
102. ‘Coast guard aims to deploy unit on remote island to deal with Chinese
boats’, Yomiuri Shinbun/The Japan News, 25 August 2015.
103. ‘60% of Yonagunijima islanders vote for stationing of SDF unit’, Asahi Shin-
bun, 23 February 2015.
104. Miha Hribernik, ‘The Japan Coast Guard (JCG) as a Foreign Policy Instru-
ment in Southeast Asia’, Asia Pacific Bulletin, No 331, 1 December 2015.
105. Richard J. Samuels, ‘New Fighting Power!’ Japan’s Growing Maritime Ca-
pabilities and East Asian Security’, International Security, Winter 2007/2008, Vol. 32,
No. 3, Pages 84-112.
106. Tim Kelly & Nobuhiro Kubo, ‘Exclusive: Japan’s far-flung island defense
plan seeks to turn tables on China’, Reuters, 18 December 2015.
126
Japan 2015
they were indicative of high strategic stakes in the eyes of policymakers in

both states.107 China and Japan’s decision to continue their naval procu-
rement in aircraft/«helicopter» carriers was indicative of the broader un-
dercurrents on the military front.108 But Japan still heavily depends on US
extended deterrence. Either a full-blown arms race or else, in the words of
a blue-ribbon advisory group to MOFA, the «law of the jungle» would be
the result of a progressive United States military retrenchment from the re-
gion.109 To avoid this nightmare scenario, Japanese policymakers reasoned
that they needed to further bolster their defense and, as recounted earlier,
to sustain the United States’ military engagement in the South China Sea.
4.1. A stabilizing factor? Economic interdependence and antagonistic

economic blocs
What about economic interaction in 2015? Proponents of commercial
pacifism argue that greater economic interdependence between states tran-
slates into increased cooperation, as rational policymakers acknowledge the
benefits of «peace dividends», such as trade, bilateral investment and redu-
ced military budgets. This paradigm ascribes to non-state actors, such as
multinational enterprises (MNE), a prominent role both in fostering econo-
mic interdependence and lobbying for international stability conducive to
business interests. Making a cost-benefit analysis, state leaders value peace
and cooperation over destabilizing military balancing policies with valuable
economic partners. This view is represented by Richard Rosecrance’s view
that global capital and interstate trade favors integration, and gradually ma-
kes military power redundant in the management of interstate relations. Ac-
cording to him, Japan is a perfect example of a trading state and, thanks to
financial liberalization in the 1980s, of a capital-exporting virtual state.110 In
addition, a richer and more recent analysis of the «ties that bind» Japan and
China towards greater integration and cooperation is presented by Kent Cal-
der and Min Ye. Their argument posits that functional cooperation through
a set of regional frameworks emerged from the ashes of the 1997 Asian Fi-
nancial Crisis and that this had fostered regional economic integration:
Strong underlying macroeconomic complementarities among capital-
intensive Japan, labor-intensive China, and entrepreneurial Korea,
107. The author adopts the classic definition provided by: Geoffrey Till, Asia’s
Naval Expansion: an arms race in the making?, Oxon: Routledge, 2012, pp. 18-19.
108. ‘China media confirm second aircraft carrier’, The Financial Times, 10
March 2015; Prashanth Parameswaran, ‘Japan Launches New Helicopter Destroyer’,
The Diplomat, 29 August 2015.
109. ‘Ministry panel predicts China will dominate Asia-Pacific in 20 years if US
withdraws’, Asahi Shinbun, 26 April 2015.
110. Richard Rosecrance, Rise of the Virtual State: Wealth and Power in the Coming
Century, New York: Basic Books, 1999.
127
Giulio PuGliese
reinforced by deepening transnational production and distribution

networks at the micro-level, and with Taiwan as an intriguing new ca-
talyst, clearly facilitate interdependence. […] the concept of a more
autonomous Northeast Asian core, with its components coordinated
through soft-institutionalist networks among the spokes of the Pacific
wheel, approaches more closely the emerging regional reality, given re-
cent trade, financial, and even geopolitical trends as China rises, cross-
Straits relations improve, and American hegemony wanes.111
Thus, according to the two authors: a) the rise of regional production
networks, in which China is Japan’s main target market for Foreign Direct
Investment and production offshoring, b) deepening epistemic communi-
ties among intellectuals and policymakers, and c) trade and financial in-
tegration, as shown respectively by the negotiation of a trilateral FTA and
bilateral swap agreements of currency reserves, have progressively made
cooperation among the parties more likely and US presence less relevant.
Critics counter-argue by citing the historical record: notwithstanding
Great Britain and Germany were each other’s major trading partner, the
rising continental Power and status-quo maritime Power fought a bitter
war between 1914 and 1918. In other words, security trumps economic
prosperity in whenever the two collide. This example is, however, partial,
since Japan’s economic stakes embedded in continental China, which are
exemplified by Japanese Foreign Direct Investments and direct ownership
of offshore production facilities, are clearly higher compared to British-
German trade in the early 20th Century. By examining transnational eco-
nomic actors, Calder, Ye and Rosecrance share the assumption that their
interests are ultimately synonymous with state interests and translate into
a rational foreign policy aimed at the maximization of economic gains.
Nonetheless, both contemporary Sino-Japanese relations and fin de siècle
European interstate relations share a major weakness, the destabilizing
and parallel influences of irrational threat perceptions, usually fed by na-
tionalistic sentiments. In fact, both set of relations have been fraught with
the destabilizing, irrational effects of mutually-reinforcing nationalisms,
both at the elite level and, to a lesser extent in Japan’s case, at the socie-
tal level.112 Evidence of such sentiments, especially on China’s side, have
been provided throughout this essay. This weakness is not usually given
111. Kent Calder & Min Ye, The Making of Northeast Asia, Princeton: Princeton
University Press, 2010, p. 263.
112. In the case of Germany and Britain, nationalism was clearly detectable on
competition for colonies and the relatively young age of the German national polity,
which would lead to the creation of powerful nationalistic narratives for the sake of
domestic stability, hence overexpansion and over-balancing: Jack Snyder, Myths of
Empire: Domestic Politics and International Ambition, Ithaca: Cornell University Press,
1991, pp. 66-111. The progressive de-legitimization of the authoritarian political
regime in communist China resembles the German example: Giulio Pugliese, ‘The
128
Japan 2015
adequate attention in theories of liberal interdependence, which often fo-

cus on rationally-calculated gains.
To sum up: key economic initiatives in the year under review testify
to the strategic use of free trade agreements and new financial institutions
for clear geopolitical aims. China inaugurated its much-vaunted Asian
Investment Infrastructure Bank (AIIB) to rival the existing G7-centered
development-focused international financial institutions: the World Bank
and the Asian Development Bank (ADB). The surprise decision by the
United Kingdom to become an AIIB shareholder triggered a chain reac-
tion among other major US allies: Germany, France, Italy, Australia and
South Korea, among others, all agreed to become early supporters of Bei-
jing’s initiative. The United States government’s unsuccessful lobbying
against their participation testified to the growing economic and political
clout enjoyed by China.113 In 2016, China will also inaugurate the BRICS-
led New Development Bank. In connection with these new financial in-
stitutions, China took its «One Belt, One Road» initiatives to augment its
presence in areas that have historically been open for American, Euro-
pean or Russian involvement. Thus, it promoted free trade agreements,
investment and infrastructure building in Central Asia and Africa, all way
to the west of China.114 Moreover, China’s new initiatives were directed
at securing its continental backyard to refocus its military energies more
confidently on the East and South China Seas. The logic of the game of go
also applied to geo-economic interaction.
Were China’s mammoth initiatives spurred solely by economic consi-
derations? To a certain extent, the grandiose plans for a new maritime and
a continental Silk Road connecting China with the land and sea fringes of
the Eurasian landmass played well with the CCP’s internal propaganda,
which increasingly insisted on the «China Dream» and the achievement of
a «national rejuvenation» that would bring China back to its ancient great-
ness. At the same time, there were undeniable geopolitical undercurrents
embedded in Beijing’s economic activities. For instance, an October 2015
special issue of the popular Chinese National Geography (Zhongguo Guojia Dili)
was entirely dedicated to China’s geo-economic challenges, and to its so-
lutions. The language register was unmistakably rooted in the Realpolitik
proper of modern geopolitical thought: it borrowed Halford Mackinder’s
term to call for China’s advancement into the Eurasian continental «heart-
land» and, to a lesser extent, into the seas through the twin «One Belt, One
Road» Initiative. According to the contributors, China needed to act becau-
se Washington was advancing major initiatives to contain China through a
Resurgence of Nationalism in Japan and China: a comparative analysis’, Orientalia

Parthenopea, Vol. X, Naples: Orientalia Editrice, 2009, pp. 209-222.
113. ‘US attacks UK’s «constant accommodation» with China’, Financial Times,
12 March 2015.
114. Kerry Brown, ‘Green light for China’s Silk Road’, Inside Story, 19 May 2015.
129
Giulio PuGliese
concert of sea powers, a concept borrowed by famous naval strategist Alfred

Mahan.115
Indeed, in October 2015 Japan and the United States, as well as ten
other countries, concluded the long-awaited Trans-Pacific Partnership
(TPP) Free Trade Agreement that bound the economies of 12 Asia-Pacific
maritime states. The economy-security nexus was evident with the inclu-
sion of key US allies and strategic partners within the scope of the TPP:
Vietnam, Japan, Australia, New Zealand, and the like. In accordance with
China’s continental initiatives, geopolitics trumped economic considera-
tions of losses and gains. In fact, the TPP certainly favored multinational
enterprises, but it would have fostered economic blocs, whose frontiers
coincide with the existing military ones. At any rate, the treaty still nee-
ded to go through the hurdles of the ratification process. The fate of the
TPP deal was still in limbo as the United States entered the presidential
campaign season: an early proponent of the deal, then Secretary of State
Hillary Clinton, turned lukewarm during the Democratic Party primaries
to woo labor unions and lobbying groups against the TPP deal.116 As de-
monstrated by the AIIB, «One Belt, One Road» and the TPP initiatives,
geopolitics were clearly deemed more important than economics. The
strategic logic of the game of go informed the behavior of the region’s
major Great Powers – China, the United States and Japan – throughout
the year under review.
5. Conclusions
The year under review testified to the primacy of geopolitical interac-

tion, resembling a game of go. Indeed, 2015 witnessed important changes
in Japan’s security strictures. The new US-Japan security guidelines and
Japan’s new security laws ushered in a new set of formal and informal insti-
tutions that would have allowed Japan, if not constrained, to a more active
security position; these factors were leading Tokyo to a more muscular stan-
ce in defense of areas well distant from the archipelago down to the South
China Sea. China’s continued assertiveness there, and Abe’s fondness for
power politics as a tool of statecraft, certainly favored Japan’s enhanced
military profile. Yet, this essay has argued that US leverage has also played
a substantial role in encouraging Abe’s interest in the China-centered game
of go. The only possible obstacle to Tokyo’s muscle flexing was Japan’s in-
115. Zhongguo Guojia Dili «Yidai Yilu» Shi Yue Tekan (Chinese National Geog-
raphy, Special October Issue «One Belt, One Road»), 14 October 2015 (http://www.
dili360.com/article/p561df4479392d20.htm).
116. ‘Hillary Clinton’s U-turn on TPP deal has team working overtime ahead of
debate’, The Guardian, 13 October 2015.
130
Japan 2015
sular, yet realist, public opinion.117 At the same time, Japanese Self-Defense
Forces’ aircraft and vessels, returning from antipiracy missions in the Gulf
of Aden, were already conducting surveillance operations around the South
China Sea, away from public scrutiny.118 More importantly, Japanese public
opinion was much in favor of routine «cautionary surveillance» there, accor-
ding to a Yomiuri Shinbun survey of late 2015.119
In the meantime Beijing pursued its tactical accommodation with Tok-
yo, but the prospects for stability in the medium term were not promising
given the simmering geopolitical tensions and bilateral war of words. The
crescendo of hostile words and actions also informed the rival economic
initiatives that were finalized in 2015. Moreover, at the very end of the year,
the East China Sea witnessed a new round of bilateral tensions, possibly in
connection with Japan’s growing involvement in the South China Sea.120
With regard to the Senkaku/Diaoyu Islands, only substantial mutual
concessions could have brought the «quiet understanding» dispute back
into life.121 In fact, the Sino-Japanese rivalry and standoff over the dispu-
ted islands is as much a dispute over geo-politics as over honor and status,
with neither side able to fundamentally back down.122 For these reasons,
a tenable and meaningful détente over the disputed islands must rest on
more than wishful calls for international arbitration through the Interna-
tional Court of Justice (ICJ). China’s reaction to a possible ICJ verdict that
assigned sovereignty to Japan will likely veer toward the hostile. For these
reasons, the two parties need to devise more creative compromises.
A popular saying maintains that good fences make good neighbors. In
fact, China and Japan have been trapped precisely by such a continental ap-
proach as this to maritime boundaries. That is, bilateral relations have suf-
fered from Tokyo and Beijing’s reification of the Westphalian trope over a
set of small disputed islands.123 Unless the two governments put a lid on the
117. Paul Midford, Rethinking Japanese Public Opinion and Security From Pacifism to
Realism?, Stanford: Stanford University Press, 2011.
118. Presentation at Joint Workshop: Globalizing Rivalry? Sino-Japanese Inter-
action in World Politics, Free University of Berlin, 12-13 November 2015.
119. Michael T. Cucek, ‘Oh King Of Awful Majesty!’, Shisaku, 30 November
2015.
120. David Tweed & James Mayger, ‘China Sends Japan a «Don’t Meddle» Mes-
sage via an Ex-Navy Ship’, Bloomberg Business, 29 December 2015.
121. On the «quiet understanding» please refer to: Reinhard Drifte, ‘The Sen-
kaku/Diaoyu Islands territorial dispute between Japan and China: between the ma-
terialization of the «China threat» and Japan «reversing the outcome of World War
II»?’, UNISCI Discussion Papers, n. 32, May 2013.
122. Robert Ayson & Desmond Ball, ‘Can a Sino-Japanese War Be Controlled?’,
Survival: Global Politics and Strategy, 2014, Vol. 56, No. 6, pp. 137-138.
123. On the reification of the Westphalian and Tianxia models and the endur-
ance of the former: June Teufel Dreyer, ‘The «Tianxia Trope»: will China change
the international system?’, Journal of Contemporary China, 2015, Vol. 24, No. 96, pp.
1015-1031.
131
Giulio PuGliese
Senkaku/Diaoyu battle for honor and status, the quiet «constabulary arms
race» taking place in the East China Seas is destined to rock the whole Asia-
Pacific. Both countries need to give more than they take in order to usher
in a new «quiet understanding» that shelves the dispute; creative solutions
may even turn a temporary fix for the Senkaku/Diaoyu Islands crisis into a
long-term solution for bilateral cooperation in the maritime boundaries of
the East China Sea. For instance, the two countries may adopt a functiona-
list approach designed after the 1950 Schuman Declaration that preluded
the European Coal and Steel Community. Hypothetically, Japan could of-
fer joint development of natural resource fields within its claimed Exclusive
Economic Zone, including the EEZ that extends from the Senkaku/Diaoyu:
in this way China abandons the implicit recognition of Japan’s claimed EEZ
median line and obtains an indirect recognition by Japan of the existence
of a dispute. Conversely, China stops any dispatch of official vessels and ai-
rcraft to the disputed islands. This would allow Japan to cement its effective
control and (already strong) legal claims there. After all, possession is nine-
tenths of the law. While the dispute is understandable given the background
of Sino-Japanese relations, the two states sought to appreciate the possible
benefits of joint exploitation of natural resources in the ECS seabed of the
Senkaku/Diaoyu Islands, and henceforth make the East China Sea «a sea of
peace, cooperation, and friendship».
Nonetheless, events in 2015 relegated the possibility of such creati-
ve solutions to the distant future, because the Senkaku/Diaoyu and Spratly
Islands’ standoffs were the products of the broader undercurrents of regio-
nal power transition. The leading strategic game of go was rooted in the lo-
gic of power politics, and the shifting tectonic plates of the Asia-Pacific were
more rapidly grinding past each-other with some significant realignments
in place. A major earthquake in one of the many fault lines came to be a
possibility. The logic of the game of go continues to govern the East Asian
seas, but, as the adage goes, «it’s all fun and games until somebody loses
an eye». The prospect for incidents looked remote in 2015, but it remains
a real possibility in the medium term in the face of Chinese assertiveness,
mounting US-China rivalry and, realistically, greater Japanese military en-
gagement in the South China Sea.
132
the philippines 2014-2015: doMestic politics
and Foreign relations, a critical review
Salvador Santino F. Regilme Jr. and Carmina Yu Untalan
Northern Illinois University, USA; Osaka University, Japan

De La Salle University-Manila a-carmina@osipp.osaka-u.ac.jp
sregilme@niu.edu
This article analyses some of the key issues in Philippine domestic politics and foreign
policy during the years 2014 to 2015. The analysis is divided into two main parts.
First, the article examines domestic politics from the lens of political corruption,
President Aquino’s good governance programme, and electoral politics. Second, the
article examines the principal patterns of power relations and key issues in regard to
the Philippine government’s foreign policy and international diplomacy strategy —
with a particular focus on bilateral relations with the United States, the rise of China
and the territorial disputes, and regional economic integration in the context of the
ASEAN. The main argument here is that the key patterns of domestic and foreign
policies and strategies of the Philippine government under the Aquino administration
reveal historically constituted shortcomings of the Philippine state in autonomously
steering its own long-term development outcomes, primarily because of two factors:
the internal struggles amongst various elite factions within the state-society nexus and
the peripheral and US-centric roles that the country plays in the international system.
My hope is that when I leave office, everyone can say that we

have traveled far on the right path, and that we are able to
bequeath a better future to the next generation. Join me in
continuing this fight for change.
Philippine President Benigno Aquino III1
1. Introduction
Elected based on his «good governance» platform, President Benigno

Aquino III’s legally mandated presidential term started last June 30, 2010,
and his presidency is expected to last until mid-2016. The quotation above
is cited from the last paragraph of Aquino’s speech, which he gave when he
was inaugurated as the 15th President of the Republic of the Philippines.
Amidst the last few months of the Aquino presidency, did his leadership live
up to the promise of «good governance» he so willingly invoked during his
campaign and in the inaugural address? How did the Aquino administra-
tion address key issues of domestic politics and foreign policy?
1. Inaugural Address 2010. Speech of Benigno S. Aquino III, President of the Phil-
ippines, 30 June 2010 (http://www.gov.ph/2010/06/30/inaugural-address-of-president-
benigno-s-aquino-iii-english-translation).

Salvador Santino F. regilme Jr. & Carmina Yu untalan
This article analyses the key developments in Philippine domestic po-

litics and foreign policy during the years 2014 to 2015. The analysis is divi-
ded into two main parts. First, the article examines domestic politics from
the lens of political corruption, economic development, peace and conflict,
and electoral politics. Second, the article examines the principal patterns
of power relations and key issues in regard to the Philippine government’s
foreign policy and international diplomacy strategy – with a particular focus
on bilateral relations with the United States as well as the territorial dispu-
tes in the region in the context of the rise of China as a regional power.
The main argument here is that the key patterns of domestic and foreign
policies and strategies of the Philippine government under the Aquino ad-
ministration reveal historically constituted shortcomings to autonomously
steer towards its own long-term development goals, primarily because of
two factors: the internal struggles amongst various élite factions within the
state-society nexus and the peripheral and US-centric roles that the country
plays in the international system. The analysis of this article begins in the
next section with a discussion on key issues in domestic politics in the Phi-
lippines during the years 2014 and 2015.
2. Domestic politics
Similar to the previous administration of President Gloria Macapagal

Arroyo (2001-2010), current President Benigno Aquino III commenced his
mandate with a massive campaign against «bad» politics through his daang
matuwid (straight path) governance brand. Aquino’s candidacy in the 2010
national elections could not have been timelier: the death of his mother,
former President Corazon Aquino, who had become the symbol of Philip-
pine democracy, occurred when Arroyo was facing serious corruption and
electoral fraud allegations. In his inaugural speech in 2010, he vowed to
transform politics by getting rid of patronage politics, junketeering, «sense-
less spending», and bribery.2 The focal point of his reputed social contract
with the people was «transformational change», which highlighted what he
aspired to accomplish: a dramatic transition from a failed leadership that
incited cynicism to an ethical one bound to stimulate renewed hope for the
country.3 This is manifest in the usual narrative of his annual State of the
Nation Address that extols his administration’s accomplishments against
the backdrop of pressing corruption and culture of impunity, both treated
as an inheritance from Arroyo and her henchmen.
2. ‘Inaugural Address 2010, Speech of Benigno S. Aquino III, (English trans-

lation), June 30, 2010’, Official Gazette (http://www.gov.ph/2010/06/30/inaugural-ad-
dress-of-president-benigno-s-aquino-iii-english-translation).
3. ‘A Social Contract with the Filipino People’, Official Gazette, (http://www.gov.
ph/about/gov/exec/bsaiii/platform-of-government).
134
The PhiliPPines 2014-2015
The unfortunate reality of Asia’s «oldest democracy»4 being trapped in

the cycle of changelessness cannot be understood through piecemeal narra-
tion of each presidency. Likewise, adjectives attached to democracy, like «ca-
cique», «clientelist», «élite», «oligarchic», and «bourgeois» could only offer
new perspectives if dovetailed with the three formidable historical chapters
that form the present political reality in the Philippines.5 The first is the
Spanish colonization (1565-1898). Spain ruled and influenced the Filipinos
mostly through Catholicism. With 86% of the population being Roman Ca-
tholics, the church has a decisive influence on domestic politics, particularly
concerning the choice of leaders and their fate and social policies, such
as the approval of the Reproductive Health Law.6 Politicians are known to
solicit political support from the Roman Catholic Church and other Chri-
stian denominations, most notably Iglesia ni Cristo (Church of Christ), given
their huge religious following and remarkable reach to ordinary citizens.
Moreover, the predominance of Catholicism has had a huge impact on the
people’s perception and treatment of Muslim minorities in the country.
The second historical chapter influencing the political present of the
Philippines is represented by the American colonization (1898-1946). Ope-
rating as a tutelary colonial state to introduce democracy in the Philippines,
the US allowed Filipinos to conduct free elections and hold government
offices under the supervision of the American administration. Since the
4. Salvador Santino F. Regilme Jr., ‘Why Asia’s Oldest Democracy Is Bound to

Fail: Analyzing Post - 1986 Philippine Democracy’, Journal of Developing Societies, pp.
1-27 (forthcoming).
5. These are prevailing characterizations in the most prominent works on Phil-
ippine politics. For instance: Benedict Anderson ‘Cacique Democracy in the Philip-
pines: Origins and Dreams’, The New Left Review, Vol. 1, Issue 169, May-June 1988;
John Sidel, Capital, Coercion and Crime: Bossism in the Philippines, Stanford: Stanford
University Press, 1999; Carl H. Lande, Leaders, Factions and Politics: The Structure of
Philippine Politics. New Haven: Yale University Southeast Asia Monograph No. 6,
1965; Paul D. Hutchcroft, Booty Capitalism: The Politics of Banking in the Philippines,
New York: Cornell University Press, 1998.
6. The Responsible Parenthood and Reproductive Health Act of 2012, or Re-
productive Health (RH) Law, ensures the universal access to contraceptive methods,
sexual education, and maternal healthcare. The implementation of the RH Law was
halted, due to claims that it promotes artificial contraceptive methods and even abor-
tion, which may be detrimental to women’s health. The strongest opposition comes
from the members of the Catholic Church who argue that the law is against family
values and the right to life of the unborn. In 8 April 2014, the Supreme Court of the
Philippines ruled the RH Law as constitutional. Catholic Bishops Conference of the
Philippines (CBCP) President Socrates Villegas called for the support of the Catholic
faithful «to maintain respect and esteem for the Supreme Court». See CBCP Statement
on RH Law, Statement of Archbishop Socrates Villegas, CBCP President (http://www.cbcp-
news.com/cbcpnews/?p=33728). For an in-depth discussion of the influence of the
Catholic Church on the Reproductive Health Bill debate, see Eric Marcelo O. Genilo,
SJ, ‘The Catholic Church and the Reproductive Health Bill Debate: The Philippine
Experience’, The Heythrop Journal, Vol. 55, No. 6, November 2014.
135
Americans lacked a sufficient number of civilians to administer a colony,

they ruled indirectly through landed élites and clans that – then and now –
govern important regions. This meant that the few existing local economic
élites and the «ilustrados» («learned» or «enlightened ones»), namely the
members of the educated class, which had taken shape during the Spanish
colonial era, were absorbed into the «administrative» machinery to get their
political support. In return, these classes were protected from seditious and
popular opposition. Many of these élites developed a «directing class» men-
tality. Such belief in their status as an educated and usually well-to-do class
granted them the privilege to act as the «natural leaders» of the popular
mass.7 Although Filipinos are generally grateful for the American heritage
of electoral democracy, it is difficult to deny that it gave birth to the modern
Philippines’ political ills. In Benedict Anderson’s words, «it was above all the
political innovations of the Americans that created a solid, visible ‘national
oligarchy’».8
The third and last historical chapter to mould the Filipino political
present is the 1986 EDSA People Power Revolution,9 which became both
the country’s boon and bane. The peaceful movement led by the alliance
between the Catholic Church, the opposition élites, and the middle class
restored Philippine democracy after over two decades of dictatorship under
Ferdinand Marcos. The 1983 assassination of Benigno Aquino Jr., perhaps
Marcos’s fiercest political rival, significantly influenced the Filipino public’s
choice for his wife, Corazon Aquino, for president. Nevertheless, despite
a new type of government, familiar faces facilitated the continuity of tra-
ditional patronage politics amidst a change of leadership. The peaceful
EDSA revolution has since morphed into a tool for both destroying and
seizing power, with two more EDSAs following as if to mock the original.
Specifically, the EDSA 2 Revolution in 2001 resulted in President Joseph
Estrada’s resignation on the count of plunder and corruption allegations.
Only three months after Gloria Macapagal Arroyo was sworn into office,
another «EDSA» occurred, only to reinstate Estrada. The irony is that the
1986 EDSA People Power Revolution also produced the «EDSA system»
that «encouraged maximum factional competition among the élite while
allowing them to maintain a united front against any change in the system
of social and economic inequality».10 That is, in spite of their name, the
7. Julian Go, ‘Colonial Reception and Cultural Reproduction: Filipino Elites

and United States Tutelary Rule’, Journal of Historical Sociology, Vol. 12, No. 4, De-
cember 1999.
8. Benedict Anderson, ‘Cacique Democracy in the Philippines: Origins and
Dreams’.
9. EDSA People Power Revolution derived its name from Epifanio delos San-
tos Avenue, where the demonstrations took place. The Archdiocesan Shrine of Mary,
Queen of Peace was built in EDSA to commemorate the 1989 People Power Revolution.
10. Walden Bello et al., The Anti-Developmental State: The Political Economy of Per-
manent Crisis in the Philippines, New York: Zed Books, 2004, pp. 1-8.
136
second and third EDSAs are by no means revolutionary. Therefore, we find

the two presidents, Estrada and Arroyo, who were brought down by EDSAs,
now occupying official positions. Estrada is currently the Mayor of the Phi-
lippines’ capital city, Manila, while Arroyo is serving as a Congresswoman
representing her native province, Pampanga.
Political reforms, no matter how well intended, are deeply conditioned
by these historical factors. Years 2014 and 2015 are as good as any other
year to illustrate the recurring or even deepening problems of Philippine
domestic politics throughout the past decades. In 1991, prominent political
scientist David Wurfel described Filipino politics from Ferdinand Marcos
(1965-1986) to Corazon Aquino (1986-1992) in terms of «development»
and «decay».11 Despite being cognizant of the minor developments that
took place during the transition, he was wary of the real possibility that the
new Corazon Aquino-led regime would restore the old crony system in the
guise of democracy. This is a prophecy that seems to be confirmed by Cora-
zon Aquino’s son’s fast track to the presidency.
The focus of this section is to discuss three enduring issues in Philip-
pine domestic politics, particularly as they manifested themselves in the
years 2014 to 2015: (1) political corruption, (2) conflict and development,
and (3) democracy and elections. As we shall see, Benigno Aquino III had a
promising start but, eventually, was unable to prevent further political decay
for the Philippines.
2.1. Political corruption

One of the most sensational corruption scandals, the Priority Deve-
lopment Assistance Fund (PDAF) scam, broke out during the Aquino admi-
nistration. PDAF, or what is popularly known as «pork barrel», are lump-
sum funds given to legislators to be used at their discretion to finance public
infrastructure and development projects. Politicians have always been noto-
rious for «pork-barrel» funding small-scale, often dubious projects, such as
basketball courts and road reconstruction, to boost their popularity among
voters.12 However the PDAF scandal revealed the gravity of corruption
behind closed doors.
The scandal came to light in July 2013, when one of the country’s lea-
ding newspapers, The Philippine Daily Inquirer, published a series of exposé
articles about what the National Bureau of Investigation called the «mother
of all scams». An estimated amount of 10 billion pesos (2.13 billion US
11. David Wurfel, Filipino Politics: Development and Decay, Quezon City. New
York: Cornell University Press, 1988.
12. The majority of Philippine local government officials put their faces and
names on banners at projects and events to solicit credit and attention from their
constituencies. A bill banning such practice is pending in the Congress.
137
dollars) «pork barrel» funds were stolen from the government.13 The chief
operator Janet Lim Napoles solicited «pork barrel» from legislators to fund
what later transpired to be ghost projects and fictitious non-governmental
organizations (NGOs). Her vast networks in government agencies and the
Congress had allowed the projects to go unchallenged for the past ten ye-
ars. Some of Napoles’s most influential accomplices included top legislators
Juan Ponce Enrile, a nonagenarian who had been intermittently serving
the government since the 1970s, Jinggoy Estrada, Joseph Estrada’s son,
and Bong Revilla, a son of a former senator. After a series of deliberations
on whether the Senate should probe into the case, the Senate Blue Ribbon
Committee14 finally began its investigation on 1 April 2014. The Supreme
Court declared PDAF unconstitutional seven months later.
While the investigations took place, the Aquino administration con-
tinued to fight corruption. Early in 2014, it recovered a part of Ferdinand
Marcos’ ill-gotten wealth and returned it to the national treasury. Aquino
abolished six non-performing government-owned and controlled corpora-
tions to streamline and improve public services. A number of appointed
officials were also charged with graft and corruption, including another
Estrada, E.R. Ejercito, who was unseated after being found guilty of misuse
of election funds.
In spite of the Aquino administration’s trumpeted accomplishments, it
has also fallen victim to its own anti-corruption strategy. Following the PDAF
scam, the public began to scrutinize Aquino’s own undisclosed and unaudited
220-billion-peso (4.7 billion US dollars) «pork barrel».15 His administration
was even accused of illegally spending public funds through his Disbursement
Acceleration Program (DAP), a stimulus economic programme designed to ef-
ficiently allocate the budget through fund reassignment and «unprogrammed
funds» spending. After a series of investigations and impeachment motions
filed by the opposition and civil society groups, in July 2014, the Supreme
Court ruled the DAP unconstitutional. However, the Aquino administration’s
motion for reconsideration was partially granted in early 2015, leaving the
DAP issue unresolved. This caused a deep rift between the executive and judi-
ciary branches,16 as well as Aquino and Department of Budget Management
Secretary Florencio Abad, who was the co-executor of the DAP project.
13. ‘NBI Probes P10-B scam: pork, government funds used in ghost projects’,
The Philippine Daily Inquirer, 12 July 2013.
14. The Senate Blue Ribbon Committee investigates alleged violations commit-
ted by members of the government and government agencies. Its main purpose is
to propose laws or legislative amendments in lieu of the investigated misdeeds. The
Committee’s membership is based on elections among senators.
15. Rigoberto Tiglao, ‘Biggest secret of all: Aquino’s P220 billion pork barrel’,
The Manila Times, 29 June 2014.
16. ‘DAP dancing: The President versus the Supreme Court’, The Economist, 2
August 2014.
138
Insofar as the PDAF scam was concerned, Napoles was indicted in

April 2015 and sentenced to reclusión perpetua, or 40 years of imprisonment
without parole, while her chief collaborators – senators Enrile, Estrada, and
Revilla – were found guilty of plunder. These results were highlighted by
Aquino as one of the achievements of his administration’s tuwid na daan
(straight path) campaign. However, these four major players were down but
not out, as shown by the fact that Revilla’s and Napoles’ bail petitions were
denied in the first division of Sandiganbayan, the Philippines collegial appel-
late court. At the closing of the period under review, Napoles’ lawyers were
contemplating an appeal to the Supreme Court.17 She also attempted to
seek refuge in the Catholic Church through the Catholic Bishops Conferen-
ce of the CBCP. Her request was turned down on the basis of existing church
law that does not allow the episcopal conference to become a guarantor of
the accused.18
To the public’s surprise, Enrile was released from jail in August 2015,
due to «humanitarian reasons». Not only that, but he has also returned as
a senator and has recently been active in Senator Ferdinand Marcos Jr.’s
vice-presidential bid campaign for 2016. The irony is clear: From being
Ferdinand Marcos’ loyal defence minister, then a key figure in ousting the
dictator, he is now looking into bringing back a Marcos into the executive
branch. As for Aquino, when asked if it would be acceptable to grant the
same pardon to Gloria Macapagal Arroyo, who is under hospital arrest, due
to serious spine complications, his reply was negative.19
With such a mixed record, it is difficult to pass a positive judgment
on Aquino’s anti-corruption campaign. His insistent allusion to Arroyo’s
malefactions is gradually losing its magic in convincing the public that his
administration is emphatically different. It is also unlikely for Aquino to
escape DAP and PDAF allegations with ease. He is currently facing a fifth
impeachment complaint for questionable spending.20 Yet, Aquino appears
undeterred by detractors and deaf to the fact that only three in ten Filipinos
in 2014 still believed in his «straight path». 21 Aquino continues to vow that
his government will weed out all sources of corruption.
17. ‘After denial by Sandiganbayan Napoles’ camp mulls elevating bail plea to
SC’, GMA News Online, 19 October 2015.
18. ‘CBCP refuses Napoles’ plea to be taken into Catholic Church’s custody’,
19. To date, international lawyer, Amal Alamuddin Clooney is handling Ar-
royo’s petition. According to Clooney, Arroyo’s detention is a violation of the Inter-
national Covenant on Civil and Political Rights. They are not filing for the former
president’s release on the grounds of humanitarian reasons.
20. ‘5 Impeachment bids prior to Aquino’s 5th SONA’, The Daily Tribune, 25 July
2014.
21. ‘Pulse Asia: Only 3 in 10 Filipinos believe Aquino fulfilled «tuwid na daan»
promise’, The Philippine Daily Inquirer, 13 October 2014.
139
2.2. Economic development

According to recent research, the most compelling concern for the or-
dinary Filipino is the absence of significant upward social mobility, which
requires the following policy priorities: (1) improving/increasing the pay of
workers, (2) controlling inflation, and (3) fighting graft and corruption in
the government.22 Yet, beneath all the chaos within élite factions mentioned
above, the Filipino public is finding it increasingly difficult to have faith in
the government’s current efforts to improve social and economic conditions.
The Aquino administration formulated the Philippine Development
Plan 2011-2016 to address these problems through «inclusive growth»,
which means extending economic benefits to the poorest and marginali-
zed sectors. In late November 2015, the Philippine National Statistics Au-
thority announced that the Philippines has the third fastest GDP growth of
6.4% in Asia, following China and Malaysia with GDP growths of 6.9% and
6.8%, respectively.23 The government attributes the growth to its prudent
fiscal management and political stability. The World Bank even descri-
bed the Philippine’s economic transformation from being a «sick man in
Asia» to being «Asia’s rising tiger».24 In his two previous State of the Na-
tion addresses, President Aquino stressed the administration’s economic
accomplishments with commendable statistical data on increased foreign
direct and domestic investments, employment opportunities, and manu-
facturing capabilities.25
Despite these accomplishments, poverty indicators have not drama-
tically changed since 2003.26 In July 2015, prominent Filipino economist
Cielito Habito observed that the Philippine economy witnessed a positive
breakout in 2014 in three counts: prices, jobs, and income. However, he saw
the recent economic slippages, particularly in the field of providing jobs
and attracting foreign direct investment, as signs of the government losing
22. ‘Pulse Asia Research’s June 2015 Nationwide Survey on Urgent National
Concerns’, Pulse Asia Website, 24 September 2015.
23. ‘Philippine economy grows by 6% in Q3’, Philippine Star,26 November 2015.
24. The World Bank, Press statement of Motoo Konishi, Co-Chair of Philippine Develop-
ment Forum, 6 February 2013 (http://www.worldbank.org/en/news/speech/2013/02/06/
Press-Statement).
25. Government of The Philippines, State of the Nation Address 2014, Speech
of Benigno S. Aquino III, President of the Philippines, 28 July 2014 (http://www.gov.
ph/2014/07/28/benigno-s-aquino-iii-fifth-state-of-the-nation-address-july-28-2014);
State of the Nation Address 2014, Speech of Benigno S. Aquino III, President of the Philip-
pines, 27 July 2015 (http://www.gov.ph/2015/07/27/president-aquino-sixth-sona).
26. According to the Philippine Statistics Authority, Philippine’s poverty inci-
dence in 2014 was registered at 25.8%. This rate is not significantly different from the
World Bank data of 24.9% in 2003 and 25.2% in 2012. See ‘Poverty Incidence among
Filipinos registered at 25.8%, as of first semester 2014’, Philippine Statistics Authority,
6 March 2014.
140
the momentum for growth.27 In fact, the IBON Foundation, a leading non-
stock and non-profit organization, characterized the economy under Aqui-
no as «worsening exclusivity».28 The IBON Foundation report indicates that
the Philippine unemployment rate of 7.0% is the worst in Asia. Job shortage
and underemployment are major reasons why Filipinos, especially the most
educated, decide to work abroad.29 High commodity prices and low average
income have diminished the ordinary individual’s purchasing power. At the
same time, the lack of investment in the agricultural and other local indu-
stries also undermines the government’s efforts in attracting foreign direct
investments for economic growth. While the latter only provides short-term
and limited impact, investing in local industries, on the other hand, would
yield long-term benefits, including providing sustainable livelihood to agri-
cultural workforce.
The IBON Foundation also questions the quality of jobs the go-
vernment boasts to have generated. Their report indicates that one-third
of the total number of employed individuals are either self-employed or
unpaid family workers, and therefore, increased employment rates do not
necessarily mean improved quality of work conditions.30 In addition, the
wealth of the Philippines’ richest has grown by 250% since 2010.31 Chine-
se Filipinos and mestizos mainly make up this socio-economic group who
monopolizes the country’s major industries and applauds the government
economic achievements. In short, the celebrated growth has been generally
inclusive of the rich, yet highly exclusive of the poor.
To improve the Filipinos’ education and marketability, the Aquino go-
vernment led an education reform programme in line with the United Na-
tion’s Millennium Development Goals. Called the K to 12 Program, it seeks
to improve the Filipino students’ skills and competency necessary for the job
market. It also aims to elevate the Philippine education system to internatio-
nal standards.32 The basic education curriculum will be brought up from the
current 10-year to a 12-year pre-university education. Filipino students who
have reached their senior year are given the choice to choose a track: aca-
27. Cielito F. Habito, ‘Recent economic slippages’, The Philippine Daily Inquirer,
28 July 2015.
28. ‘Economy under the Aquino administration: Worsening exclusivity’, IBON
News, 28 July 2014.
29. Salvador Santino F. Regilme Jr., ‘Is International Labor Migration Good
for Democratic Consolidation?’, Peace Review: A Journal of Social Justice, Vol. 25, No.1,
January 2013, pp. 97-103.
30. ‘Over one million jobs generated under Aquino poor in quality’, IBON
News, 5 October 2015.
31. ‘Aquino Legacy: Wealth of the richest tripled’, IBON News, 24 July 2015.
32. Being the only Asian country and among the three countries with a 10-year
pre-university cycle, the Philippines clearly lags behind the Washington-accord and Bo-
logna Process’ prescribed 12-year basic education required in an entry-level engineer-
ing position and university admission and professional practice in European countries.
141
demic, technical-vocational-livelihood, or sports and arts. After completing

the requirements for a K to 12 degree, students will have the option to either
work right after finishing secondary school or pursue a university degree. In
any case, adding two more years in basic education is expected to give them
a better chance for their pre-university education to be officially recognized
abroad, both in university enrollment and professional employment. The
two-pronged projected outcome of (1) holistic and competent students and
(2) more job opportunities within and outside the country are expected to
have a huge positive economic impact. The programme incremental imple-
mentation began in 2012 and expects completion in 2018.
However, the initial eagerness of the Filipino public in the K to 12 Pro-
gram is transforming into cynicism.33 Indeed, critics are wary of the paucity
of resources allocated to implement such dramatic change in the education
system. The planned additional two years in the pre-university curriculum
pose a logistical nightmare for the government, which has been dealing
with classroom and teacher shortages for a very long time. The situation is
much worse in areas with problematic supplies of textbooks and learning
materials.34 The Catholic Bishops Conference of the Philippines (CBCP)
is concerned about the possible increase in dropout rates and the negative
impact on academic and non-academic personnel, who are likely to face
unemployment in the process.35 According to a report jointly issued by the
Commission on Higher Education, the Department of Education, the Tech-
nical Education and Skills Development Authority, and the Department of
Labor and Employment, the reduction in college enrolment may affect ap-
proximately 25,090 employees.36 Classroom shortages in public high scho-
ols may also lead to a higher dropout rate. An estimated one million stu-
dents entering senior high school are expected to leave school because they
cannot afford to transfer to private institutions. The government created
the Tertiary Transition Education Fund to be disbursed in 2016 in order to
address these logistical problems.
On a more principled level, critics consider the K to 12 Program as
«exploitation» and «abuse of power». Various mass protests called for the su-
spension of the programme’s implementation, if not altogether scrapping
33. ‘Majority of the Filipinos support K to 12 education program – SWS Survey’,

34. Shortage and undelivered books in peripheral areas is a recurring problem.
According to the Commission on Audit (COA) the Department of Education was re-
ported to have wasted Philippine Peso 608 million worth of books that were ordered
yet not suitable for the new, enhanced curriculum. Teachers are also complaining
about undelivered K to 12 books.
35. ‘CBCP Statement on Catholic Schools and K to 12 Program. Statement
of Socrates Villegas, D.D. CBCP President’, CBCP News (http://www.cbcpnews.com/
cbcpnews/?p=37539).
36. ‘25,090 teaching, non-teaching personnel to lose jobs when K-12 is in full
swing’, GMA News Online, 4 May 2015.
142
it. The government’s harshest critics come from the civil society’s left-wing
organizations, which are worried that the programme may lead to further
labour exploitation, especially among children and the youth. A number of
public schools nationwide have played host to anti-K to 12 demonstrations,
usually led by teachers, students, and parents. The Manila Science High
School, one of the top public high schools in the country, filed a petition
against the Aquino government to annul K to 12 to the Supreme Court on
the grounds of «abuse of discretion».37 Another group composed of uni-
versity professors and academics, Alyansa ng mga Tagapagtanggol ng Wika
(«Defenders of the national language») or Tanggol Wika, also filed a case
against the programme for deliberately undermining the Filipino language
and native literature in favour of more «economically productive» courses.38
The programme’s unpopularity is largely due to the adverse short-
term consequences caused by its implementation. In fact, a point has been
reached where no spin on the part of the government can assuage the
doubts and fears of a conspicuous part of the public. So far, there have been
a total of six petitions to stop the K to 12 programme. The government,
nevertheless, remains convinced that the long-term social and economic
benefits would later overshadow the current and foreseeable setbacks.
Lastly, another key issue for Philippine economic policy under the Aqui-
no administration is regional economic integration within the framework of
the Association of Southeast Asian Nations (ASEAN). In principle, regional
economic integration includes the following key goals: «(a) a single market
and production base, (b) a highly competitive region, (c) a region of equita-
ble economic development, and (d) a region fully integrated into the global
economy»39. To a substantial extent, the relatively impressive economic per-
formance of the country under the Aquino administration was driven by a
variety of domestic and international factors, including the country’s commit-
ment to be part of the ASEAN regional economic integration agenda.
Indeed, this ambitious region-wide economic integration plan is also
matched by the Aquino administration’s relatively unprecedented economic
governance measures that seek to bolster the country’s economic competi-
tiveness and political preparedness for ASEAN integration. As one of the
country’s most influential economists, Harvard-educated Bernardo Villegas
assessed the Philippine’s current economic state in the following words:
«Only an earthquake like in Nepal and several typhoons like Yolanda can di-
srupt the growth of the Philippine economy. This is because of the political
37. ‘Another petition vs. K to 12 to be filed before SC today’, The Philippine Star,
23 June 2015.
38. ‘Tanggol Wika group asks SC to stop K-12 Program’, The Philippine Daily
Inquirer. 15 April 2015; ‘Filipino language advocates to seek help vs. new CHED cur-
riculum’, GMA News Online, 2 December 2014.
39. ‘ASEAN Community 2015: Integration for Whom?’, IBON International
Policy Brief, 21 April 2015.
143
reforms made by former President Cory Aquino up to the incumbent.»40 In

addition, Philippine Finance Secretary Cesar Purisima attributed the count-
ry’s remarkable economic performance to three factors: «First, transpa-
rency. People are being allowed to evaluate if changes are really happening.
Two, rule of law and the responsiveness of the government. And others are
inclusiveness, accountability and participation.»41 In particular, the count-
ry’s top trade official Gregory L. Domingo highlighted landmark policy in-
terventions in promoting micro, small, and medium enterprises (MSMEs)
in bolstering the local economy. Considering the severe problem of heavy
traffic in Metro Manila’s main roads, Domingo clarified that the Philippine
government «do[es] invest in the right infrastructure», whereby the admi-
nistration «tripled our [the] infrastructure budget from around 165 billion
Philippine pesos in 2010 to 535 billion» in 2015.42 Another key economic is-
sue for the government was addressing the constitutional restrictions impo-
sed on foreigners in terms of ownership of land. In particular, several local
economists, including Gerardo Sicat, who was a former top economic advi-
ser to the Philippine government. He was called for eliminating restrictions
to foreign nationals in terms of land ownership, access to natural resources,
and opportunity to invest in public infrastructure (current restriction in the
1987 Philippine Constitution limits foreigners ownership in these fields to
40% of the total value of the property in question).43
2.3. Peace and conflict

Integrating the Muslims into a predominantly Christian state conti-
nues to be a multifaceted challenge for the Philippines. Muslims compri-
se approximately 5% of the country’s population, 58% of which are in the
Autonomous Region of Muslim Mindanao (ARMM). Those who live in this
region are collectively called «moros» (the Spanish word for «moors»), an
identity that morphed from its derogatory Spanish colonial roots to its pre-
sent self-identification function.44 While the protracted armed conflict in
40. Chrisee Dela Paz, ‘AEC 2015: Will PH Firms Be Market Disruptors?’, Rap-
pler, 21 May 2015.
41. Ibid.
42. ‘Philippines Seen Gaining Substantially From Asean Integration’, Inquirer
Business, 6 September 2015.
43. ‘Foreign Ownership Limits Hinder Phl Growth Potential’, Philippine Star, 3
June 2015.
44. It is important to note that non-Muslim ethnic minorities called the lumads
are also part of the ARMM. Since they comprise the minority of the region, some of
them have assimilated to the Moros’ struggle for self-determination and territorial
autonomy. For more, see Oona Paredes, ‘Indigenous vs. native: negotiating the place
of Lumads in the Bangsamoro homeland’, Asian Ethnicity, Vol. 16, No. 2, 2015. Also,
an ongoing major concern is the successive killings of lumads in Mindanao by military
and paramilitary groups.
144
ARMM is often depicted in religious and ethnic terms, it is also a form

of resistance against the national government based in «imperial» Manila.
Like their counterparts in other Southeast Asian states, the inhabitants of
this region represent a group of people whose settlement in the archipelago
predates colonization, which they have more or less continuously resisted
for centuries. In fact, the «moros» have resisted Spanish, American, and
Japanese occupations and have more or less uninterruptedly been fighting
for a separate territory and identity from the centre since the Spaniards
colonized the archipelago.
While the relationship between the Philippine state and the Muslims in
Mindanao was relatively amicable in the 1920s, the rise of new intellectuals
and counter-élites revived the demand for greater autonomy 50 years later.
The Corregidor Jabidah massacre in 1968, when 28 Muslims were brutally
murdered, and the Martial Law imposed in 1976 compounded the conflict
between the government and the Muslims in the south. Internal ideological
conflict in the Moro National Liberation Front (MNLF), whose struggle was
originally based on the search for self-determination of peoples in the re-
gion, regardless of their religion, gave birth to a number of religious-based
breakaway groups. The most notable among them are the Moro Islamic Libe-
ration Front (MILF) and Abu Sayyaf, born in 1978 and 1991, respectively.45
Because of such groups’ insurgent and violent methods, the Philippine go-
vernment and the international community consider them threats to peace.
The United Nations and the US classify Abu Sayyaf as a terrorist group with
support from international terrorist network, al-Qa‘ida.46
Aside from this, the region is a magnet for criminal activities, such as
kidnapping, murder, and ethnic violence. The New People’s Army, an armed
communist rebel group, is known to be very active in the area. The long-
standing armed conflicts result in the death and displacement of hundreds
of thousands of local citizens. Economically, the ARMM is among the poo-
rest regions in the country, with a poverty incidence rate of 48% in 2012.47
45. The Moro Islamic Liberation Front (MILF) is the biggest rebel group in the
Philippines. Contrast to the MNLF, who seeks to establish an independent Mind-
anao state, the MILF aims to create an independent Islamic state and is therefore
religiously driven. The Abu Sayyaf group is a militant Islamist separatist group that
has established terrorist networks outside the Philippines, including Malaysia and
Indonesia.
46. Salvador Santino F. Regilme Jr., ‘A Theory of Interest Convergence: Ex-
plaining the Impact of US Strategic Support on Southeast Asia’s Human Rights Situ-
ation, 1992-2013’, PhD Dissertation, Department of Political and Social Sciences,
Freie Universität Berlin, 2015, pp. 108; Salvador Santino F. Regilme Jr., ‘Bilveer
Singh on the «Taliban» of Southeast Asia’, Asia-Pacific Social Science Review, Vol. 9, No.
2, 2009, pp. 89-92.
47. ‘Highlights of the 2012 Full Year Official Poverty Statistics’, Philippine Statis-
tics Authority Web Site (http://www.nscb.gov.ph/poverty/2012/highlights_fullyear.asp).
145
The region contributes only 1.3% to the Philippine national economy, the
lowest among 18 administrative regions.48
In other words, both history and socio-economic conditions exacer-
bated the already deep resentment that Muslims feel against the national
government. The ceaseless armed clashes between separatist groups and
the military are clearly manifestations of such problems.
Peace negotiations with the Muslims in ARMM have been taking pla-
ce since the 1989 Tripoli Agreement, which granted partial autonomy to
the region. Ultimately, these negotiations have not led to a solution of the
ongoing conflict, both because of disagreements among faction groups
within the Bangsamoro itself and the lack of consistency on the part of
the national government.49 For instance, when President Joseph Estrada
declared an all-out-war against the MILF, his infamous roasted pork fe-
ast nearby a mosque caused further agitation, even among the moderate
Muslims. The Arroyo administration has tried to revive the peace talks
with the help of Malaysian representatives, yet the subsequent military
attacks on the MILF camp caused the tragic unraveling of its efforts to
settle with the Bangsamoro.
The years 2014-2015, however, saw what could be a turning point
in the relationship between the central government and the secessionist
groups in the southern Philippine island of Mindanao. The Aquino admi-
nistration, together with Malaysian and Japanese leaders, has been wor-
king towards reaching a peace agreement with the MILF since 2012. The
Framework Agreement of the Bangsamoro in 2012 and the Comprehensi-
ve Agreement on the Bangsamoro in 2014 were two milestones reached by
the Aquino administration in dealing with the «moros». Moreover, at the
closing of the period under review, the Congress was deliberating the pas-
sage of the Bangsamoro Basic Law (BBL), which promises to give further
autonomy to the Bangsamoro. The law should guarantee the rights of self-
governance and self-determination for the Bangsamoro, under the gene-
ral supervision of the central government. To ensure greater and distinct
autonomy, the law stipulates that the relationship between the Bangsamo-
ro and the central government shall be considered «asymmetrical».50
48. ‘Davao Region’s economy records the fastest growth in 2014’, Philippine
Statistics Authority Web Site, 30 July 2015 (http://www.nscb.gov.ph/pressreleases/2015/
psa_pr-20150730-sn1-01_grdp.asp).
49. Bangsamoro is a collective term for the thirteen ethno-linguistic groups in
the ARMM. While the term ‘moro’ is technically linked to being a Muslim, the current
usage of Bangsamoro includes non-Muslims, Christians, and the lumads, who believe
that the Moro is a separate national identity from the majority of the Filipinos.
50. Under the BBL, the Bangsamoro region will be granted expanded auton-
omy from the central government. This means that unlike local governments, the
region will have more legislative powers and fewer central government interventions.
See Article VI, Bangsamoro Basic Law.
146
While everything went relatively well,51 skepticism girdles the BBL’s

passage. In January 2015, the Mamasapano incident in the ARMM province
Maguindanao shook what seemed to be a somewhat smooth transition for
both parties. With an estimate of 250 casualties, including 44 Special Action
Force (SAF) policemen and 18 MILF members, the incident became a lit-
mus test for Aquino’s sincerity about the peace process. As the blame game
between the President and SAF Commander Napeñas on who was respon-
sible for the tragedy transpired,52 the public’s opinion regarding the BBL’s
efficacy as a solution to the conflict grew largely negative.53 The Mamasa-
pano clash raised serious doubts about the ability of a more autonomous
Bangsamoro to address the precarious condition of Maguindanao. Signifi-
cantly, the investigations that ensued became a reason to postpone the BBL
deliberations in the Senate. Meanwhile, Aquino’s trust rating dropped from
59% in November 2014 to 38% four months after the incident.54
Besides the clash, it seems that the BBL has its own structural and
internal problems. The bill has been pending for almost a year because of
disagreements among lawmakers and between lawmakers and the Bangsa-
moro representatives. Whereas Philippine lawmakers assert the «uncon-
stitutionality» of MILF’s demands for autonomy, MILF Chief Negotiator
Mogaher Iqbal accused them of justifying their reluctance to devolve more
51. There were a few high-profile disturbances in the region, including the Zam-
boanga Crisis in 9 September 2013, where some rogue members of the MNLF attacked
Zamboanga City, a highly urbanized, predominantly Catholic city in Mindanao.
52. During the investigations, Aquino blamed SAF Commander Getulio Nap-
enas for acting alone and defying his orders. Napeñas, on the other hand, argued
that he was in fact following orders from suspended Philippine National Police Chief
Director Alan Purisima, who was Aquino’s close friend and was allowed to work in
the operation despite his suspension. The issue has yet to be resolved and is pend-
ing further investigations in the year 2016. See ‘Palace blames Napeñas’, Philippine
Star, 12 February 2015; ‘Napeñas: PNoy, Purisima gave «implied» order to continue
Mamapasano ops’, GMA News Web Site, 11 February 2015.
53. Supposedly owing to the incident, a survey conducted by Pulse Asia two
months after the incident shows that 44% of Filipinos opposed the passage of the
Bangsamoro Basic Law. However, the Center for Media Freedom and Responsibility
also warned against the unethical and sensationalized version of the media that may
have swayed the public towards a negative direction. Despite this, MILF Chair Al-Haj
Murad affirmed his commitment to the peace process. See ‘Pulse Asia Research’s
March 2015 Nationwide Survey on the Bangsamoro Basic Law (BBL), the Mamasa-
pano Operation, and the Presidential Resignation’, Pulse Asia Web Site (http://www.
pulseasia.ph/UB2015.html); ‘Media coverage of the Mamasapano Clash: Unethical,
inflammatory and sensationalized’, Center for Media Freedom and Responsibility, 4 March
2015; ‘Gov’t to pursue BBL passage, won’t give up on goal of Bangsamoro peace,
progress’, Office of the Presidential Adviser on the Peace Process Web Site (http://www.opapp.
gov.ph/milf/news/govt-pursue-bbl-passage-won%E2%80%99t-give-goal-bangsamoro-
peace-progress).
54. ‘Pulse Asia Research’s March 2015 Nationwide Survey on Presidential Perfor-
mance and Trust Ratings’, Pulse Asia Web Site (http://www.pulseasia.ph/UB2015.html).
147
power to the region because of their «very conservative interpretation of

the Constitution».55 The gridlock in the senate gave civil society groups,
academics, the church, and the business sector the impetus to appeal for
the passage of a fair Bangsamoro law. However, to echo Mindanao peace
and conflict specialist Rizal Buendia, «The threat of national disintegration
will continue until an appropriate institutional framework for political go-
vernance which can accommodate Mindanao’s social and ethnic diversity is
ensconced.»56 So long as the government commits itself to strategies similar
to the past, a peace agreement is unlikely to take effect.
2.4. Democracy and elections

With the next general election scheduled for 9 May 2016, in the period
under review, democracy and electoral issues have attracted a lot of atten-
tion. Accordingly, during the closing months of 2015, the media agencies
were preoccupied with either generating or twisting information for public
consumption. On the one hand, allegations to discredit candidacies, ran-
ging from citizenship issues to corruption scandals, provided an incredible
spectacle, bemusing the public opinion.57 On the other hand, political reali-
ties seemed to dampen the usual Filipino hope for political salvation.
Like other leaders whose term is about to end, Aquino appears to have
invested the last months of his mandate in creating legacies. These include
the attempt at reducing the influence of dynasties or political clans in the
government. Filipino kinship politics continues to survive through violence
and rent-seeking behaviour.58 The stronghold of the members of a limi-
ted number of important families on both national- and local-level politics
breeds corruption and poverty in many areas.59 Presently, 70% of the Philip-
pine Congress members belong to dynasties, some of which have close ties
55. Mong Palatino, ‘Philippine Bangsamoro Deal in Danger of Collapse’, The

Diplomat, 8 August 2014.
56. Rizal G. Buendia, ‘The Politics of Ethnicity and Moro Secessionism in
the Philippines’, Asia Research Center Working Paper 2004/11, Perth: Asia Research
Center, Murdoch University, November 2007, p. 18 (http://dspace.africaportal.org/
jspui/bitstream/123456789/23945/1/The%20politics%20of%20ethnicity%20and%20
Moro%20secessionism%20in%20the%20Philippines.pdf?1).
57. On one hand, Grace Poe, the daughter of action star Fernando Poe Jr., who
ran and lost to Arroyo in 2004, is among the top candidates for presidency in the
upcoming 2016 national elections. There are appeals for her disqualifications on the
basis of citizenship as she holds a US passport. Vice President Jejomar Binay is also
among the top presidential candidates, despite facing corruption charges.
58. Alfred W. McCoy, ‘An Anarchy of Families: The Historiography of State and
Family in the Philippines’, in McCoy A. (ed.), An Anarchy of Families: State and Family in
the Philippines, Quezon City: Ateneo Manila University Press, 1994, p. 1-32.
59. Ronald U. Mendoza, et al. ‘Inequality in democracy: Insights from an em-
pirical analysis of political dynasties in the 15th Philippine Congress’, Philippine Politi-
cal Science Journal, Vol. 33, No. 2, 2012, pp. 132-145.
148
with the economic élites.60 Surnames like Aquino, Roxas, Osmeña, Marcos,
and Cojuangco have occupied government seats since 1902. Even without
focusing too much on surnames, patronage politics still plays a dominant
role in the social, political, and economic spheres, affecting the integrity of
elections and making difficult inclusive growth in the country.
As a legal safeguard against this abuse of power, the 1987 Constitution
stipulates that «the State shall guarantee equal access to opportunities for
public service, and prohibit political dynasties as may be defined by law».61
Interestingly, several versions of the Anti-Dynasty law have been passed for
over two decades to make the constitutional clause more specific, each wi-
thout a hint of success.
During the period under review, the political scandal involving Vice
President Jejomar Binay became a major reason for suddenly rekindling the
urgency to approve a new and more stringent anti-dynasty bill. The Binays
have been a dominant political clan in Makati, the country’s business and
financial hub situated in central Metro Manila. Vice President Binay and his
family members are facing corruption charges. His son, Jejomar Binay Jr. was
recently dismissed from public office due to corrupt spending and dishonesty.
Vice President Binay is also Aquino’s formidable political opponent, and he is
one of the Presidential candidates for the upcoming 2016 national elections.
Whether Aquino is taking advantage of Binay’s unpleasant political
standing or is seriously concerned because of the ill effects of dynastic po-
litics, his decision to push the anti-dynasty bill earned him general appro-
val. The bill, once passed, would limit the number of similar surnames in
the government. Interestingly, Aquino himself is part of a long-standing
Cojuangco-Aquino dynasty. His relatives are among the richest people in
the Philippines. His uncle Eduardo «Danding» Cojuangco was both a for-
mer crony of Marcos and Corazon Aquino’s cousin. Should Aquino be suc-
cessful in making the Anti-Dynasty Bill his political legacy, over 150 con-
gressmen will be affected. Some of Aquino’s detractors have criticized the
Anti-Dynasty bill as a toothless law aimed at glorifying Aquino’s presidency.
Indeed, the domestic political developments in the Philippines during
the years 2014 and 2015 appear to be mixed but are still welcomed by the
Filipino public – an attitude that is starkly different from the one towards
the previous administration.
3. Foreign policy
As a former Spanish colony for more than 300 years and the first co-
lony of the United States (US) in the first half of the 1900s, the Philippines
60. Ibid.
61. The 1987 Philippine Constitution, Article II, Section 26.
149
has one of the most Western-oriented foreign policies in the Asia-Pacific re-
gion. The Philippines is a US long-standing military ally, whose relationship
is based on the Mutual Defence Treaty (MDT), signed on 30 August 1951.
In the East Asian region, the Philippines, Japan, and Thailand are the US’
only MDT allies. The MDT solidified US-Philippine bilateral relations right
after Washington formally ended its colonial domination over the archi-
pelago. During the postcolonial period, the Philippines remained one of
the US’ most reliable allies in the region during the Cold War, as the ar-
chipelagic country functioned as a buffer state against what was then seen
as the threat posed by the potential spread of communism from China to
Southeast Asia. Even during the 1990s, after the end of the Cold War, the
US-Philippine bilateral relations remained relatively cordial, despite the
fact that the Filipino government, with the support of the Filipino public
opinion, eventually decided to remove American military bases in Subic and
Clark, then the largest of its kind in the world.62
In the post-9/11 period, the Philippines once again became a focal point
of US foreign policy, when the Bush administration labelled the country as
one of the key allies in the «war on terror» and branded the Southeast Asian
region as the «second front» in such global military campaign. In practice,
post-World War II foreign policy of the Philippine government is largely sha-
ped by the national and local élites who are mostly sympathetic to the Uni-
ted States. In fact, these élites are strongly influenced by the rich American
cultural heritage and prominent political institutions that remained after the
colonization period,63 making possible a process of enduring pro-American
socialization of these élites, including the leaders of the country.64
It is important, however, to note several cardinal principles that govern
Philippine foreign policy, as stated in the 1987 Philippine Constitution and
other relevant laws. According to the 1987 Constitution, also known as the
«Freedom Constitution», the state disregards war as a matter of national po-
licy, enshrines international law as part and parcel of the national laws, and
adheres to principles such as «peace, equality, and justice».65 The Freedom
Constitution also advocates for an «independent foreign policy», whereby
principles such as «sovereignty, territorial integrity, national interest, and
the right to self-determination» constitute some of the supposed key values
of the government’s external relations.66 In addition, the foreign service
62. Andrew Yeo, Activists, Alliances, and Anti-U.S. Base Protests, New York City:
Cambridge University Press, 2011, pp. 36-40.
63. Alfred McCoy, Policing America’s Empire: the United States, the Philippines, and
the Rise of the Surveillance State, Wisconsin-Madison: University of Wisconsin-Madison
Press, 2009, pp. 1-14.
64. Natasha Hamilton-Hart, Hard Interests, Soft Illusions: Southeast Asia and Amer-
ican Power, Ithaca: Cornell University Press, 2012.
150
apparatus of the Philippine state is governed by the Department of Foreign

Affairs, in accordance to the Republic Act No. 7157 or the «Philippine Fo-
reign Service Act of 1991», which highlights three main goals for the exe-
cution of the country’s foreign policy: (1) national security, (2) economic
security, and (3) the welfare of the Filipinos based abroad.
Considering the above overview of the governing laws pertaining to
the Philippines’ foreign relations, this section on Philippine foreign policy
and international relations during the years 2014 to 2015 is divided into
two main thematic parts: (1) foreign relations with the United States and (2)
the territorial disputes in the South China/West Philippine Sea amidst the
rise of China as a regional power.
3.1. Foreign relations with the United States

During the term of US President Barack Obama, the US foreign policy
apparently shifted towards a more Asia-oriented perspective, whereby the
long-term goal was to shift a greater percentage of military resources from
the Atlantic to the Pacific.67 Many analysts believe that such a shift, at least
from a rhetorical standpoint, represents Washington’s clear recognition that
the epicenter of global economic and political transformation in the deca-
des to come will be in the Asia-Pacific region. To the extent that the Philip-
pines is one of the only three Mutual Defence Treaty allies of the US in the
region, this shift in the US foreign policy has transformed the Philippine in-
ternational role in ways that are qualitatively different from before. Whereas
the post-9/11 US foreign policy of the Bush administration became evident
in the Philippine government’s increased domestic counter-terror opera-
tions, thereby emphasizing domestic security, the Obama administration,
particularly during Hillary Clinton’s tenure as Secretary of State, spearhe-
aded an external security-oriented bilateral relation with the Philippines.
This means, in policy terms, that the increased US militaristic assistance to
the Aquino-led Philippine government was a response to the emerging ter-
ritorial conflict in the South China Sea vis-à-vis the growing military power
and political influence of China.
In view of such shifts in US foreign policy and the apparent transfor-
mations in the balance of power in the Asia-Pacific region, the Philippine
and US governments have implemented several new landmark bilateral
agreements and policies. Notably, on occasion of the two-day state visit of
US President Barack Obama in Manila in April 2014, Philippine Defense
Secretary Voltaire Gazmin and US Ambassador to the Philippines Philip
67. Salvador Santino F. Regilme Jr., ‘A Theory of Interest Convergence: Ex-

plaining the Impact of US Strategic Support on Southeast Asia’s Human Rights Situ-
ation, 1992-2013’, PhD Dissertation, Department of Political and Social Sciences.
Freie Universität Berlin, 2015, pp. 155-193; Hilary Clinton, ‘America’s Pacific Cen-
tury’, Foreign Policy, 11 November 2011.
151
Goldberg signed the Enhanced Defense Cooperation Agreement (EDCA),

a 10-year defence arrangement that seeks to bolster American military pre-
sence in and assistance to the Philippines.68 Indeed, this must be viewed
against the background represented by the fact that some 25 years earlier,
in the early 1990s, the Philippine government evicted American troops sta-
tioned in military bases in Luzon, northern Philippines. That was a change
triggered by the global American military retrenchment strategy and fol-
lowed by the US in the early post-Cold War period and by the shifts in the
policy priorities of the newly democratizing Philippine government of the
time. Considering such critical juncture in the 1990s, the EDCA was indeed
a landmark agreement to the extent that it represented an opportunity for
the US military forces to have relatively comprehensive access to Philippine
military bases and facilities, in ways that were not evident in the 1990s. Spe-
cifically, the EDCA enables the US military to have access to at least eight
military bases of the Philippine Armed Forces, two of which are located in
a strategic position vis-à-vis the highly disputed South China Sea.69 Apart
from that, the goals of the EDCA are not only strictly military but aim to
give «the United States greater flexibility to respond to threats and natural
disasters in the region.» 70
3.2. The rise of China and territorial disputes

China’s rise as an influential global leader has posed immense geo-
strategic and political challenges to many countries in the Asia-Pacific re-
gion, especially the Philippines, which has maintained enduring and close
bilateral ties with the United States.71 One of these challenges that became
prominent, especially in the period under review, is the South China Sea/
West Philippine Sea (SCS) territorial dispute. China and the Philippines
are two of several main claimants to several parts and territories within the
SCS region. Although the SCS dispute has existed for several decades, Chi-
na’s unprecedented political, military, and economic rise, coupled with its
increasing assertiveness in putting forth its territorial claims, has greatly
sharpened and made more dangerous the pre-existing situation. In contrast
68. ‘DFA Chief: US Bound to Defend PHL in Case of Attack in West Philippine
Sea’, GMA News Online, 30 April 2014; ‘PH, US Eye 8 Military Bases Under EDCA’,
ABS-CBN News, 24 April 2015.
69. ‘PH, US Eye 8 Military Bases Under EDCA’, ABS-CBN News, 24 April
2015.
70. Juliet Eilperin, ‘U.S., Philippines Reach 10-Year Defense Agreement Amid
Rising Tensions’, The Washington Post, 27 April 2014.
71. ‘China to «Complete» South China Sea Land Reclamation’, BBC, 16 June
2015; Permanent Court of Arbitration, Press Release: Arbitration Between the Republic of
the Philippines and the People’s Republic of China, The Hague, 13 July 2015 (http://www.
pcacases.com/web/sendAttach/1503); Steven Stashwick, ‘Naval Buildups in the South
China Sea’, The Diplomat, 15 July 2015.
152
to Beijing’s militaristic and unilateral orientation, Manila has highlighted

the need for public diplomacy and called for procedural international law
to arbitrate amongst claimant countries. Consequently, President Aquino’s
government initiated formal legal proceedings to the Permanent Court of
Arbitration in The Hague in mid-2015. This initiative seeks to undermine
China’s perceived unilateralism, disregard for international law, and incre-
asing militaristic strategy in resolving the dispute.
To be sure, the Philippine public opinion has been increasingly con-
cerned about the ongoing land reclamation activities and the ensuing diplo-
matic disputes over the SCS islands and reefs. In fact, according to the 2015
Pew Research Center survey, around 91% of the total number of respon-
dents asked from the Philippines claimed that they were «very/somewhat
concerned» about the territorial disputes between China and claimant
countries in East Asia.72 Indeed, this apparently overwhelming anxiety of
the Filipino public over the current territorial disputes can be seen within
the broader context of the US-China rivalry, in which the US, the status quo
power, has been increasingly seen as being seriously challenged by China in
terms of leadership over the Asia-Pacific region. In the same Pew Research
Survey conducted in 2015, around 65% of the total number of respondents
expressed serious scepticism over the probability that China «will/never re-
place» the US, while only 25% believed that China «will/has replaced» the
US. Moreover, the 2014 Global Attitudes Survey of the Pew Research Center
confirmed that the majority of the respondents from the Philippines viewed
the US as the country’s «greatest ally», with China as «the greatest threat» –
both findings correlated well with how the Aquino government conducted
its foreign policy with regard to the major challenges posed by ongoing
US-China rivalry.73
Essentially, the Aquino-led Philippine government implemented a pre-
dominantly US-centric foreign policy, which practically made its bilateral
relations with Washington the centrepiece of the Philippine government’s
foreign policy. While many smaller states in many parts of the world may
continue to strategically hedge – or strategically engage with the status quo
(US) and challenger powers (China) – the Philippine government chose to
bolster its military ties and public diplomacy in support of continuing US
leadership in the region. It is worth stressing that this decision has been
taken in spite of the fact that «trade between the Philippines and China is
not only stable, but also growing», whereby Philippine government statistics
account for total trade amounting to US$ 14.6 billion in 2013 alone.74 Hen-
72. See Pew Global Research, Global Attitude Survey, especially the years between
2013-2014 (http://www.pewglobal.org/database/indicator/1).
73. Ibid.
74. Andrea Chloe-Wong, ‘Philippines-China Relations: Beyond the Territorial
Disputes’, The Center for International Relations and Strategic Studies (CIRSS) of the For-
eign Service Institute (FSI), Philippine Department of Foreign Affairs, Vol. 1, No 3,
153
ce, it appears that the Philippine government considers it strategically more

relevant to place its bet on the continuation of US political and military
leadership in the Asia-Pacific region rather than on the growing economic
clout and military assertiveness of China. To be sure, during the Asia-Paci-
fic Economic Cooperation (APEC) meeting held in Manila last November
2015, US President Obama urged the Chinese government to take «bold
steps to lower tensions, including pledging to halt further reclamation, new
construction and militarization of disputed areas in the South China Sea».75
Although the US government does not hold any formal position on the
territorial demands of various claimant countries, the Obama administra-
tion invoked freedom of navigation in the South China Sea region.76 The
Obama administration’s decision not to formally take a clear position in the
territorial dispute suggests its attempt to balance two seemingly conflicting
interests: American interests in bilateral cooperation with China on a wide
range of global governance issues vis-à-vis America’s security commitments
to the Philippines as a military ally.
4. Conclusion
This essay analytically examines some of the most prominent issues in

Philippine domestic politics and foreign relations during the years 2014 to
2015. The goal herein is not to exhaustively examine the causes and con-
sequences of the prominent socio-political problems that emerged during
those years; instead, the aim is to highlight some of those issues in order to
tease out how they could plausibly fit in the broader and long-term patterns
of power relations within the Philippine state-society nexus.
Based on the illustrative empirical analysis in this essay, we tentatively
argue that the issues we examined herein demonstrate two notable long-
term patterns of power relations within the Philippine state-society nexus.
First, in terms of domestic politics, the Philippine state persistently con-
fronts enduring internal struggles amongst various political-economic éli-
tes, all of whom seek to maximize the promotion of their own interests,
regardless of the agenda of the ruling presidential regime. Second, in terms
of foreign relations, the Philippine state, to a large extent, conducts a US-
centric foreign policy, despite the constitutional provision that guarantees a
supposedly «independent» foreign policy strategy. Such patterns of power
relations apparently are not unique to the Philippines; indeed, many states
in the Global South are facing severe problems, both as far as internal con-
July 2014 (http://fsi.gov.ph/wp-content/uploads/2014/07/2014-07-Philippines-China-

Relations-Wong.pdf), p.1.
75. ‘Obama Calls on Beijing to Stop Construction in South China Sea’, The New
York Times, 18 November 2015.
76. Ibid.
154
flict amongst élites (in many cases, leading to violent conflict) is concerned
and in implementing a supposedly independent foreign policy, which, in
reality, is still beholden to the interests of more powerful states. Questions
about regime consolidation or democratic stability are quite crucial to many
of these states, but perhaps a crucial starting point of our analysis is how
such severe problems of consolidation are actually outcomes of historically
constituted interactions between domestic and transnational factors.77 Fi-
nally, the succession of presidential regimes has to be seen within the long-
term and enduring patterns of continuity of elite contestation within the
Philippine state-society nexus as well as the enduring and prominent role
that the United States has in the construction of Philippine foreign policy.
77. Salvador Santino F. Regilme Jr., ‘Bringing the Global Political Economy
Back in: Neoliberalism, Globalization, and Democratic Consolidation’, International
Studies Perspectives, Vol. 15, No. 3, June 2013, pp. 277-296.
155
IndonesIa 2015: The fIrsT year of The «PeoPle’s PresIdenT»
Elena Valdameri
Asia Maior – An Italian think tank on Asia

elena.valdameri83@gmail.com
Joko Widodo’s election in 2014, after a long and harshly contested presidential race,
raised great expectations: not beholden to the military and political elites of the Su-
harto era, Indonesian people considered him a representative of new democratic forces
vis-a-vis the deep-seated «New Order» legacy. Accordingly, 2015 was important to see
the extent to which these great expectations would be fulfilled. Unfortunately, the new
President’s record was a mixed one, as the hoped-for change, although not completely
absent, was greatly constrained by Joko Widodo’s inability to overcome the resistance of
the conservative forces, still well entrenched both in the opposition and inside the ruling
coalition who exerted their sway against Widodo’s advanced pro-poor and reformist pro-
gramme. In fact, the new President had to come to terms with these conservative forces,
allying himself with at least some of the most influential politicians of the «New Order»
Suharto era. Of course, this could not but adversely reflect on Joko Widodo’s credibility.
To make things more difficult, Indonesia in 2015 continued to be characterised by
strong internal tensions. These were caused by the persistent discrimination against
religious and ethnic minorities, by the militarisation of the outermost region of West
Papua, and by a comparatively new political development in Indonesia, namely the
rise of radical forms of Islam, represented by domestic organisations which claimed
to be linked to the murderous Middle Eastern Islamic State (IS). Given this back-
ground, in 2015 Joko Widodo was unable to clearly take a firm stance on these issues,
in spite of their potential danger of destabilisation.
Finally, the global economic crisis represented a further considerable challenge for
the new President who, in 2015, was unable to fulfil his electoral promise to free the
largest economy in South East Asia from the slowdown which had begun during his
predecessor’s (President Yudhoyono) last term.
1. Introduction
2015 was an important year for Indonesia, because it coincided with

Joko «Jokowi» Widodo’s first full year in office as President. Jokowi’s elec-
tion was saluted as a remarkable event, a radical turning-point in the history
of the country, since the new President was the first to not come from the
Suharto-related military or political elite.1 For this reason, Joko Widodo em-
1. Marco Vallino, ‘Indonesia 2014: Joko Widodo e la sfida all’élite del «New
Order»’, Asia Maior 2014, pp. 137-49.

ElEna ValdamEri
bodied a «new hope» for Indonesia, the only man who thanks to his humble
origins could bring effective change to improve the situation of the wong
cilik, the «ordinary man».
Nonetheless, as will be seen, the longed-for change was more taxing
than it was optimistically expected, made difficult not only by the country’s
systemic problems, but also by Jokowi’s questionable alliances with suspi-
cious politicians and by his lack of a well-structured ideological vision. In
spite of some positive developments, after more than one year from his
election the so-called «man of the people» was still struggling to assert his
independence vis-à-vis the conservative forces which have traditionally
dominated Indonesian politics.
This chapter will first focus on Indonesia’s domestic policy. In order
to consolidate his power basis, Jokowi wooed the military and made a
series of political moves at odds with his original programme. The issues
analysed include: the political discourse about the 1965 anti-communist
massacres, Jokowi’s stance on the Papuan question, the alarming revival
of radical Islamist groups, some of which are linked to the Islamic State
(IS), and, finally, the regional elections. Then, Indonesia’s new foreign
policy will be discussed, which aimed at transforming the archipelagic
country into a major maritime power, willing and capable of taking a
more independent stance vis-à-vis the ASEAN group and in relation to
the tense situation in the South China Sea. Finally, the last section will
analyse Jokowi’s response to the economic slowdown affecting Indonesia
in the year under review, including the pro-poor measures taken to fulfil
electoral promises.
2. Domestic policy: «Jokowi is us»?2
2.1. Jokowi’s «original sin»

Jokowi’s victory was generally welcomed with relief. Many feared that
if his opponent Prabowo Subianto, a general of the Suharto-era and an
oil-magnate,3 had become president of Indonesia, the country might have
backtracked on the difficult path to democratisation. Therefore the fact that
Jokowi,4 a man of no privilege or wealth, could win the election was consid-
ered a step forward in the consolidation of Indonesian democracy.
Undoubtedly, Jokowi, often compared with Obama, owes his popular-
ity to his image of a clean new face in the Indonesian political scene. For
this reason, the people, unhappy with the extant nepotistic and corrupted
2. Jokowi adalah kita (Jokowi is us) was the presidential campaign slogan.
3. Prabowo Subianto’s main argument was that democracy is inherently incom-
patible with Indonesia’s culture/civilisation.
4. ‘Profile: Joko Widodo’, BBC News, 22 July 2014.
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IndonesIa 2015
political system, saw the new President as a valid alternative, if not the an-
tithesis, to his immediate predecessor: Susilo Bambang Yudhoyono (2004-
14). Nevertheless, since his presidential candidacy, Jokowi had to rely, para-
doxically, on the financial and political backing of those same oligarchs who
have traditionally dominated the Indonesian political system and economy.
Joko Widodo’s victory, therefore, was the result of both grassroots consensus
and negotiations with at least some of the old oligarchs. In fact, popular
support coming from grassroots organisations and new forms of campaign-
ing, involving the use of social networks such as YouTube and Twitter came
together with support from vested interests. Hence, it is very likely that
Jokowi’s success in the presidential race would not have been possible if the
chairman of the Indonesian Democratic Party of Struggle (PDI-P) Megawati Su-
karnoputri had not decided to support him, a fact that gave Jokowi national
prominence.5 Also media tycoon Surya Paloh, chairman of NasDem Party
and close associate of Megawati, gave his support as well.6 Finally Jokowi’s
choice of Muhammad Jusuf Kalla – Golkar’s unsuccessful presidential can-
didate in 20097 – as his running mate, proved equally decisive.
5. Joko Widodo was already a member of PDI-P but he had played an important
role in Megawati’s party.
6. Surya Paloh’s support was fundamental because his media company gave
Jokowi great visibility. Unlike most politicians, in fact, Jokowi did not possess a TV
channel or newspaper. Ross Tapsell, ‘Indonesia’s Media Oligarchy and the «Jokowi
Phenomenon»’, Indonesia, No. 99, April 2015, pp. 29-50, here pp. 48-49. I have re-
cently interviewed Tapsell, who confirmed that also after taking office, Joko Widodo
did not buy any TV or newspaper and is not part of any media group. According to
Tapsell, moreover, the most independent newspaper is Tempo. Nevertheless, its En-
glish version is not as good as the Bahasa version and articles often do not contain
in-depth analyses. Two very important sources to better understand the concentra-
tion of media and the conflict of interest that characterise the information sector
is Wahyu Dhyamtmika, ‘Who Owns the News in Indonesia?’, Nieman Reports, 11
December 2014. Thanks to help from Kristianto Nugraha, from the Jakarta-based
Centre for Innovation Policy and Governance, I found two important reports on
media. The first report, which focuses on the developments of media after Suharto,
is crucial for understanding the dynamics between business and politics. See Yanuar
Nugroho et al., Mapping the Landscape of the Media Industry in Contemporary Indone-
sia, Jakarta: Centre for Innovation Policy and Governance, 2013 (http://cipg.or.id/
wp-content/uploads/2015/06/MEDIA-2-Media-Industry-2012.pdf). The second re-
port deals with the powerful sway exercised by TV in shaping the citizens’ mentality
about minorities such as the Ahmadiyya. See Yanuar Nugroho, Leonardus K. Nu-
graha, Shita Laksmi, Mirta Amalia, Dinita Andriani Putri, Dwitri Amalia, Media and
the Vulnerable in Indonesia: Accounts from the Margins, Report Series, Jakarta: Centre
for Innovation Policy and Governance, 2013 (http://www.batukarinfo.com/system/files/
media-and-vulnerable-1.pdf).
7. Golkar, founded in 1964 in contrast to the Indonesian Communist Party (PKI),
was led by the Bakrie family, one of the richest in Indonesia, and was the ruling party
from 1973 to 1999, during the last phase of Suharto’s «New Order» and during B. J.
Habibie’s presidency (1998-99). It was part of the ruling coalition supporting Presi-
dent Susilo Bambang Yudhoyono (2004-14), whereas during the latest presidential
159
ElEna ValdamEri
Indeed, Jokowi’s necessity to fall back on the support of a section of

the old oligarchic forces which he was supposed to fight can be considered
the «original sin» of his presidency. Hence the wavering conduct which, dur-
ing the year under review, came to characterise the new presidency betrayed
Jokowi’s conviction that his outsider status was a source of vulnerability,
rather than strength.8 Therefore, soon after Jokowi’s victory, it became
clear that the new President would struggle to keep his credibility amidst
an intricate political scenario characterised by the continuing hegemony
of a few powerful and wealthy elites.
When Joko Widodo took the oath of office in October 2014, his
weakness was very apparent. As a matter of fact, the majority of seats in the
newly inaugurated Parliament were controlled by the conservative Red-
and-White coalition. Taking its name from the colours of the Indonesian
flag and led by Prabowo, this coalition comprised Prabowo’s own party
Gerindra, Golkar, Yudhoyono’s Democratic Party (PD), the Islamic PAN
(Partai Amanat Nasional), PKS (Partai Keadilan Sejahtera), and PPP (Par-
tai Persatuan Pembangunan). Together they held 63% of the seats. This
fact enabled the opposition to pass measures aimed at strengthening its
position, while obstructing Jokowi from realising his programme.9
To make matters worse, Widodo had to combat the pro-status-quo
forces within his own coalition. In fact, on the one hand, the ex-Presi-
dent Megawati Sukarnoputri and her daughter Puan Maharani were wary
about Jokowi’s agenda. In particular, Puan perceived the new President
as a threat to her power within the PDI-P, which she considered a family
property, although the party was also Jokowi’s strongest political support.
On the other hand, the other forces in the alliance had strong links with
the political elites of the New Order and did not look favourably upon
the reforms promised by Widodo. It should not be forgotten, indeed, that
there were two parties in Jokowi’s coalition that were created after a split in
the conservative Golkar, that is Hanura, led by the former commander of
the armed forces Wiranto, and NasDem founded by the above-mentioned
media tsar Paloh, both linked to the Suharto’s regime. Moreover, Widodo
strategically allied with the Partai Kebangkitan Bangsa (PKB) or National
campaign it was the political backbone of the Red-and-White coalition, in opposition

to Joko Widodo. In 2015 Golkar split into two factions fighting for leadership: one is
run by the powerful tycoon Aburizal Bakrie, the other by Agung Laksono, a former
parliamentary speaker. In January 2015, Laksono’s Golkar agreed not to disrupt or
bring down the government for the next five years. Moreover, in March, Laksono’s
faction left the Red-and-White coalition in order to support Jokowi, without officially
entering the ruling alliance; ‘Opposition Groupings Shrinks as Golkar exits’, The Ja-
karta Post, 11 March 2015.
8. Liam Gammon, ‘Jokowi’s Year of Living Cautiously’, EastAsia Forum, 12 De-
cember 2015.
9. Adelle Neary, ‘Red and White Coalition spreads trouble for Jokowi’, EastAsia
Forum, 14 October 2014,
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IndonesIa 2015
Awakening Party, namely a traditionalist Muslim party, in order to win the

vote of the rural Muslim constituency in Java.10
All this considered, since the beginning of his mandate, Jokowi ap-
peared to vacillate between presenting himself as the man of the people
and surrendering to pressures from those among his political allies who
belonged to the traditional power elites. Indeed, during Jokowi’s first year
in power, on several occasions the public expressed disappointment, be-
cause of the impression that the new President was acting as the establish-
ment’s front man or, at least, that he could not gain autonomy from the
key establishment figures in his coalition. Many started wondering wheth-
er Jokowi had leadership capability and if his integrity was such to with-
stand the pressure of the old hefty politicians and military-businessmen.11
The point is that, if the new President needs the support of the traditional
political forces, he also needs the backing of those civil society groups
which are a growing reality in Indonesia. These groups – which cannot be
ignored, especially given their pivotal role in Jokowi’s rise – continue to
be perceived as a threat by the establishment. In this situation, as noted by
Philip Vermonte, the President must prove his credibility and accordingly
will be judged in terms of legal enforcement and corruption eradication,
both important elements in his campaign.12
In light of this, as maintained by Klaas Stutje, historian at the Uni-
versity of Amsterdam, there are three main roadblocks in Jokowi’s path
towards change for Indonesia. First, the President is alarmingly depend-
ent on dark, authoritarian forces which influence his choices in the con-
servative sense. Secondly, Jokowi’s coalition is not stable, because, as of-
ten happens in Indonesian politics, parties have no ideological basis and
jump easily from one side to the other of the political spectrum. Third,
Jokowi himself has never developed a clearly defined ideology: this makes
it unclear which social classes he is focused on and which social structures
he relies on to realise the bottom-up approach to politics he proclaims to
support.13
10. See Andreas Ufen, ‘Jokowi’s Victory: The End of the New Order in Indo-
nesia?’, BertelsmannStiftung, Asia Policy Brief 2014/05, August 2014, pp. 5-7, cit. in
Marco Vallino, ‘Indonesia 2014’, pp. 143-44.
11. During the New Order, the Indonesian army was one of the most powerful
in the South East Asian region. According to Suharto’s concept of dwifungsi (dual
function), besides defending the state, the military played an important and active
role in politics and business. With reformasi, the army was deprived of its political
powers – although still wielding a strong influence on the political life of the coun-
try. However, it has kept businesses worth millions of dollars. Karishma Vaswani,
‘Indonesia’s Army «Retains Business Empire»’, BBC News, 12 January 2010.
12. ‘Jokowi strengthens his power base’, The Jakarta Post, 3 September 2015.
13. Klaas Stutje, ‘«Change» in Indonesia: Critical Reflections on Indonesian
Elections’, Open Democracy, 6 September 2014.
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ElEna ValdamEri
2.2. Jokowi’s new government

Once elected head of the Indonesian Republic, the new President had to
pay his political debt to those members of the traditional oligarchic order who
had supported his political ascent. This explains why Paloh and Muhammad
Yusuf Kalla were soon appointed to top positions in State-owned enterprises
(SOE) and given seats in the Working Cabinet.14 Likewise, Megawati’s PDI-P
obtained eight ministerial seats,15 while Paloh’s NasDem got three seats and
the post of Attorney General, despite his party only winning 6.2% of seats in
the House.16 Furthermore, controversial figures closely linked to Suharto’s
New Order were chosen to be part of the government: for example Ryami-
zard Ryacudu, retired army general involved in the genocidal military opera-
tions in Timor-Leste, was appointed Minister of Defence.
Nevertheless, the newly elected President tried to balance these
questionable choices by appointing 19 non-partisan professionals to his
34 member cabinet.17 Moreover, some members were chosen for their pro-
democratic and inclusive credentials: for example, the rector of Paramadina
University in Jakarta, Anies Baswedan, a reputed intellectual who, among
other things, campaigned against corruption,18 was appointed Minister of
Education, while a moderate Muslim figure, Lukman Hakim Saifuddin was
appointed Minister of Religious Affairs. The latter engaged in talks with re-
ligious minorities, mainly Ahmadiyya, Shias and Christians, and stated that
cases of violence and discrimination affecting them would not be tolerated.
This and similar announcements notwithstanding, many cases remain unre-
solved and in October in Aceh, a province were sharia has been established,
three Churches were burnt.19
14. Most Indonesian Cabinets are known by the name given to them at the mo-
ment of their formation. Accordingly, Joko Widodo’s Government is referred to as the
«Working Cabinet» or « Kabinet Kerja». This is rather confusing as a First, Second,
Third and Fourth Working Cabinet existed during Sukarno’s time.
15. The post of Coordinating Minister over the education and welfare portfoli-
os was bestowed on Puan Maharani, Megawati’s own daughter. Hamish MacDonald,
‘Jokowi: Modern Man of the People or Divine Clown?’, The New Mandala, 4 March 2015.
16. Bagus BT Saragih, ‘Jokowi: a Hostage of his own Alliance’, The Jakarta Post,
30 January 2015.
17. According to the Jakarta-based Global Future Institute, the professionals
appointed by Joko Widodo represent strong business interests and have close rela-
tionships with a network of foreign corporations such as British Petroleum, Conoco
Phillips, ExxonMobil, and China National Offshore Oil Corporation. Agus Setiawan
& Ferdiansyah Ali, ‘The classification of professionals and party professionals: An
entrance of neoliberal economic technocrats in Jokowi-JK government’, The Glob-
al Review, 17 September 2014 (http://www.theglobalreview.com/content_detail.
php?lang=en&id=16298&type=7#.VpZvyIRlmt).
18. ‘Anies R. Baswedan: Young Nationalist with a Global View’, The Jakarta Post,
8 May 2008.
19. Nurkholis Hidayat, ‘Jokowi’s First Year: Human Rights’, Indonesia at Mel-
bourne, 19 October 2015.
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IndonesIa 2015
2.3. The Gunawan and Hendropriyono controversies

Unfortunately for the new President, 2015 started with a huge contro-
versy around the appointment of Budi Gunawan as National Police Chief in
January.20 Gunawan, a personal friend and former aide of Jokowi’s political
patron, Megawati, was suspected of money laundering and bribery by the
Corruption Eradication Commission (KPK), the formidable anti-corruption
organisation established in 2003. This not only created a conflict between the
police and the KPK – with Gunawan starting investigations against some key
members of the anti-graft agency – but it also ignited a feud between Jokowi
and Megawati. In fact, the general uproar against the criminalisation of the
KPK pushed Jokowi to defy his own party, since he realised that his overall
reputation was in danger. Finally, in mid-February Jokowi made up his mind
and dropped Gunawan from his post, a move that was gladly welcomed by the
Indonesian public opinion, although considered belated by several activists.21
Again, in February, another fact reminded the public of dynamics
typical of the Suharto era and cast a shadow on Jokowi’s reputation of anti-
graft advocate. During the President’s official visit to Malaysia, a Memoran-
dum of Understanding (MoU) was signed between Proton, the Malaysian
national carmaker, and ACL, a rather unknown Indonesian car company.
However the CEO of ACL and, as such the one who signed the MoU, was
the controversial A. M. Hendropriyono. Hendropriyono, a retired four-star
General and former head of the National Intelligence Agency, 22 who had
close ties with Megawati and had been one of the greatest backers of Jokowi
during his ascent to the presidency, was suspected of human rights viola-
tions.23 Apart from that, the Indonesian public was stunned to find out that
20. ‘Jokowi’s Feud with Megawati Colors Indonesian Politics’, Rappler, 25 June
2015.
21. ‘Finally, Jokowi Dumps Controversial Police Chief Nominee’, Rappler, 18
February 2015.
22. The Indonesian car company, in fact, is not registered with the Ministry of
Industry and it is not clear who its owners are. ‘President Jokowi and Hendropriyono
Say Proton Deal with PT ACL Not for National Car Program’, Global Indonesian Voices,
10 February 2015.
23. Marshall Clark & Yasmi Adriansyah, ‘Domestic controversy plagues Jokowi’,
EastAsia Forum, 10 March 2015. Hendropriyono was tarred with the nickname «Butch-
er of Lampung», after he led the massacre that took place in 1989 in Talangsari, a
village in Lampung region, in South Sumatra, which had been an important base for
Muslim militants since the 1970s. The massacre left around 300 dead. Hendropri-
yono, then Colonel, was in charge of the group of soldiers who attacked the unarmed
peasants of the allegedly rebellious «Islamic village». Damien Kingsbury, Power Politics
and the Indonesian Military, London: Rutledge Curzon, 2003, pp. 103-4. This is not
all. According to US leaked cables, it seems that the Hendropriyono, when head
of the Indonesian Intelligence, was involved in the killing of Munir Said Thalib in
2004. Munir was an activist who founded Kontras, a human rights organisation that
demands justice for victims of state violence. The case is yet to be resolved and is con-
sidered a test for Jokowi’s will to rectify human rights and state abuses. Sri Lestari Wa-
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ElEna ValdamEri
the beneficiary of the Malaysian-Indonesian joint-venture was the lesser

company of a political affiliate of Jokowi, instead of Esemka, Indonesia’s
national car brand. Resentment was raised against Widodo’s inability to de-
tach himself from cronyism,24 which the President had promised to uproot.
2.4. The August reshuffle of the presidential cabinet

In August, the President reshuffled the cabinet, a decision aimed at
strengthening his position, which, as seen above, was precarious because of
the opposition within and outside his own party. The reshuffle occurred in
the background of an economic slowdown and the fall of Indonesian rupiah
at a 17-year low. Six ministers were replaced in order to make the public feel
confident that the economic situation would improve.25 In the first place,
Jokowi replaced three out of four Coordinating Ministers26 to attain better
coordination and communication: this move was appreciated by analysts as
more convenient stability-wise than the replacement of the main technical
ministers themselves.27 What appeared evident was Joko Widodo’s willing-
ness to choose figures known to international markets28 and to «counter
rising negative perceptions of Indonesia’s protectionist trade policies»,29
before his official visit to Washington. So, the previous Trade Minister, Rah-
man Gobel, was replaced by Thomas Lembong, a Harvard-educated econo-
mist, specialised in investment banking,30 whereas Darmin Nasution, for-
mer Central Bank of Indonesia director and official in the Finance Ministry,
was appointed Coordinating Minister of Economics. Compared to the for-
mer Minister, Sofyan Djalil, it seems that Nasution is less dependent on the
hyuningroem, ‘Solving Munir’s murder case, a test for Indonesia’s president-elect’,

The Conversation, 9 September 2014.
24. Note the fact that Hendropriyono’s son and son-in-law also benefitted from
Jokowi’s favour: in fact the former general’s son, Diaz Hendropriyono, was appointed
commissioner at Indonesia’s state-owned largest mobile operator, Telkomsel, whereas
Andika Perkasa, Hendropriyono’s son-in-law, was made commander of the presiden-
tial guard Paspampres. See ‘Indonesians up in arms over Jokowi crony firm, Proton
deal’, The Malaysian Insider, 9 February 2015.
25. Ardi Wirdana, ‘Five Facts to Note about the Indonesian Cabinet Reshuffle’,
The Establishment Post, 19 August 2015.
26. Coordinating ministers – four in total – were in charge of supervising the
policies of a group of Ministries. The only coordinating Minister left in place was
Puan Maharani. More information on her below.
27. This is Philip Vermonte’s opinion in ‘Indonesian cabinet reshuffle: ex-
perts respond’, The Conversation, 13 August 2015.
28. Ibid.
29. Prashanth Parameswaran, ‘What does Indonesia’s cabinet reshuffle mean?’,
The Conversation, 13 August 2015.
30. The Economist appreciated Lembong’s appointment, since he started a
policy of deregulation soon after taking office. ‘Jokowi’s First Year’, The Economist
Intelligence Unit, 26 November 2015.
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IndonesIa 2015
Vice-President Jusuf Kalla, with whom Jokowi had disagreements in terms

of economic policies.31 Moreover, the former military, now rich business-
man, Luhut Binsar Pandjaitan, head of the special forces under Suharto and
already Chief of Staff in the President’s office (the latter position he left one
month after the reshuffle), was appointed Coordinating Minister for Securi-
ty and Political Affairs with six ministers, including those of Foreign Affairs,
Home Affairs and Defence, reporting to him.32 Luhut, a forceful supporter
of Jokowi and part of the latter campaign team since the beginning,33 was
still very influential in the military; therefore his choice can be perceived
as a way to gain favour from the army while countering Megawati’s heft.
Nevertheless, Mrs. Sukarnoputri’s daughter, Puan Maharani, was the only
Coordinating Minister (of Human Development and Culture) to remain in
her place, despite the general discontent with her performance. Moreover,
Sukarnoputri’s closest aide and PDI-P former general secretary, Pramono
Anung, obtained the position of cabinet secretary. Also Dr. Rizal Ramli, ap-
pointed the new Coordinating Minister for Maritime Affairs, was consid-
ered to be close to Megawati. All these appointments signalled the sway of
Sukarno’s daughter and granddaughter over the President, which makes
it difficult for him to find a compromise between his avowed objective to
appoint his ministers on the basis of meritocracy and his need to appease
his political sponsors. In terms of power consolidation, a further step on
Jokowi’s part was the political deal completed at the beginning of Septem-
ber, which brought the moderate Islamist National Mandate Party (PAN) into
the ruling coalition, giving the government a majority.34
2.5. The limitations of Jokowi’s pro-workers stance

With this background, the President’s ambivalence towards social
movements, such as human rights activists and trade unions, came to the
fore.35 Accordingly, despite Jokowi’s supposed pro-workers stance, a new
regulation was introduced in October, which tied annual wage increases to
the current fiscal year inflation and to GDP growth rates. The new regula-
tion replaced a formula which was more favourable to the workers based on
31. Prashanth Parameswaran, ‘What does Indonesia’s cabinet reshuffle mean?’.

32. ‘Indonesian president Jokowi consolidates power under his wily chief of
staff, Luhut Pandjaitan’, South China Morning Post, 14 August 2015.
33. Ardi Wirdana, ‘Five Facts to Note’. In fact, Luhut left Golkar to join the
would-be President’s sukses tim (campaign team). Yet, the Luhut-Jokowi relationship
started before the latter’s presidential race: Luhut, after leaving the military and
making a fortune thanks to his commodities company, invested in Jokowi’s furniture
business. Maria A. Ressa, ‘Luhut: The general who has Jokowi’s back’, Rappler, 27
September 2015.
34. At that point Jokowi’s coalition controlled 46% of seats and the opposition
43%. See ‘PAN Officially Joins Government Coalition’, Tempo, 2 September 2015.
35. Stutje, ‘«Change» in Indonesia: Critical Reflections on Indonesian Elections’.
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ElEna ValdamEri
the basic cost of living (KHL),36 and did away with the past practice of talks
between unions, companies and local officials. Moreover, the labour strikes
against the government’s decision were violently repressed by the police,
especially in Jakarta, where thousands of workers had gathered.37 The gov-
ernment even vowed to protect businesses by providing security measures in
order to guarantee the safety of foreign companies against potential future
strikes.38
Another of Jokowi’s stances which seems at odds with his proclaimed
pro-labour inclination is his resolve to join the controversial international
treaty Trans Pacific Partnership (TPP), announced during the official visit
to the US in late October.39 Without dwelling on the TTP characteristics –
which, given the secrecy enveloping the pact, are mainly known thanks to
documents leaked by WikiLeaks – here it suffices to remember – in Michela
Cerimele’s words – that «the TPP seem[s] to be the bearer of a possible sus-
pension of national, economic and political sovereignty, and as well as limi-
tative of human rights and of important elements of democracy, all goals
which are to be reached through the adoption of extraterritorial regulatory
and judicial norms.»40 All in all, there are reasons to believe that the TPP is
completely at odds with a «people-centred economy».41
2.6. Jokowi’s «muscular» policy

During 2015, Joko Widodo, in order to address his sagging popular-
ity – something certainly exacerbated by the unfavourable economic situa-
tion – reacted by taking actions that caused dismay both within and outside
the country. In the first place, after brushing aside last-minute appeals by
foreign leaders, in January a total of six people convicted of drug traf-
ficking, including five foreign nationals,42 were executed. Besides rejecting
clemency requests, President Widodo forcefully defended the executions,
36. ‘Thousands of workers to hold strikes across Greater Jakarta’, The Jakarta
Post, 24 November 2015. The KHL calculates the cost of 84 basic commodities and
other daily needs of workers. There have been strikes related to minimum wages
throughout the year in several areas of the country.
37. ‘Police criticised for violently dispersing labor protest’, The Jakarta Post, 1
November 2015.
38. ‘Government vows to protect businesses from anarchic rallies’, The Jakarta
Post, 5 November 2015.
39. ‘Indonesia will join Trans-Pacific Partnership, Jokowi tells Obama’, The
Guardian, 27 October 2015.
40. Michela Cerimele, ‘Il 2013 vietnamita tra liberismo economico e autori-
tarismo politico: l’anno dei paradossi’, Asia Maior 2013, p. 304. More generally, on
the TPP ibid., pp. 322-26, and the sources quoted there.
41. See below in the economy section.
42. These included one from Vietnam, one from Malawi, one from Nigeria, one
from Brazil and one from the Netherlands.
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IndonesIa 2015
stating that Indonesia was facing an «emergency» regarding drug use.43

In order to rally support for his adamant stance against drug smugglers,
Joko Widodo wooed Islamic organisations visiting the headquarters of In-
donesia’s two largest Muslim organisations: Nahdlatul Ulama (NU) and
Muhammadiyah.44
Also the decision to sink foreign illegal fishing boats has been a source
of bewilderment and diplomatic tension, especially with Malaysia. The
President has justified this as a necessary move to safeguard the self-suffi-
ciency of small islands in terms of fish, namely the main food resource in
the largest archipelagic state in the world. But, at the same time, curbing
illegal fishing is being considered a test, although a minor one, for the new
maritime security agency, called Bakamla. Bakamla is viewed as a critical
institution for the realisation of the country’s maritime ambitions; in turn,
maritime security, as a matter of fact, is one of the pillars of Jokowi’s ideolo-
gy.45 The highly public sinking of boats has served a double function: on the
one hand, the government was flexing its muscles to intimidate the neigh-
bouring countries;46 on the other hand, it was tapping into nationalistic
sentiments in a period of plummeting public approval, as also suggested by
the fact that the sinking of 41 illegal fishing vessels took place on National
Awakening Day.47
2.7. Jokowi’s inability to come to terms with Indonesia’s past

Jokowi’s tough actions and stance, however, were not enough to cover
up his continuous political wavering, as shown by his inability to come to
terms with his country’s genocidal past. Widodo had promised a national
reconciliation process and an official apology for the 1965-66 anti-commu-
nist killings.48 The year 2015, marking the 50th anniversary of the mas-
43. Gabriel Dominguez, ‘100 days in power – Has Indonesia’s Jokowi shaken
things up?’, Deutsche Wwlle, 26 January 2015.
44. ‘Muslim organisations support death penalty’, The Jakarta Post, 26 Decem-
ber 2014.
45. Prashanth Parameswaran, ‘Indonesia’s Maritime Ambition: Can Jokowi Re-
alise it?’, RSIS Commentary, No. 44, 4 March 2015 (https://www.rsis.edu.sg/wp-content/
uploads/2015/03/CO15044.pdf).
46. Note the fact that it seems that the government is cautious about sinking
Chinese boats (ibid.).
47. ‘Nation Marks Awakening Day, Sinks big Chinese Boat’, The Jakarta Post, 21
May 2015.
48. James Giggacher, ‘A war on words, a murder of memory’, New Mandala, 28
October 2015. Several scholars prefer to describe the killings as a genocide, given
the appalling extent of the massacre which left 500,000 to one million people dead.
The national reconciliation process itself has been criticised by the families of the
victims and by human rights activists, who think that the non-judicial approach will
deemphasise truth and justice in favour of reconciliation and that the single cases
will not be taken into account, perpetuating the impunity of the culprits. See Papang
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ElEna ValdamEri
sacres, would have been the perfect occasion to show that Indonesia was
ready to admit its past wrongs. Actually, with bitter disappointment for the
families of the victims, for human rights activists and for intellectuals, it
was Jokowi himself who silenced any rumours that he would offer a public
apology on the 30th of September, the date in which the killings started in
1965. The President stated in front of the leaders of the most important
national Muslim organisation, Muhammadiya, that he had no intention of
doing so, a statement reaffirmed afterwards in high-sounding military tones
by Luhut Pandjaitan.49 In fact, it was the pressure exerted by the Islamic
organisations – Muhammadiya, Nathdlatul Ulama, and also the radical Is-
lamic Defender Front (FDI) – and by the military, both more or less involved
in the massacres that prompted the President to abandon any thought of
apologising officially.50 In particular, the FDI stated that it absolutely for-
bade Joko Widodo to apologise, because an apology would have meant a
justificatory posture towards the Communist Party of Indonesia and would have
implied that the communists had done nothing wrong.51 It is important to
note that the relationship between Jokowi and Islam is particularly delicate.
During his presidential campaign, Jokowi reiterated his tie with the major-
itarian Sunni Islam, so much so that, as already noted, he allied with the
PKB, a traditionalist Islamic party which had previously joined conservative
coalitions. The PKB shift gave Jokowi an «Islamic edge», which in fact the
would-be President needed in order to refute Prabowo’s allegations that he
Hidayat, ‘Indonesia: Time to Remember the Forgotten Mass Killings of 1965’, The
Diplomat, 2 October 2015. A Reconciliation Committee was indeed formed in May
2015, but the fact that Attorney General Muhammad Prasetyo and Defence Minister
Ryamizard Ryacudu dismissed the International Tribunal held at The Hague on 10-
13 November to enquire about the 1965 Indonesian mass killing as a farce is a clear
sign of Indonesia’s official stance about its painful past. See Mong Palatino, ‘Inter-
national Court Revisits Indonesia’s 1965 Mass Killings’, The Diplomat, 19 November
2015, and ‘Activist slams ministers for rebuffing 1965 massacre tribunal’, The Jakarta
Post, 11 November 2015. Moreover, the fact that Prasetyo presides over the Reconcili-
ation Committee does not lend much credibility to the institution in terms of human
rights, even though Prasetyo exerted a strong pressure in favour of the execution of
the drug dealers.
49. John Roberts, ‘Indonesian authorities ban discussion of 1965 coup at Bali
writers festival’, World Socialist Web Site, 2 November 2015. Furthermore, Jokowi said
that an apology would give no relief, since both parties claim to be victims. By making
no distinction between victims and oppressors, the President downplayed the suffer-
ing of those who were persecuted and promoted the widespread culture of impunity.
Laksmi Pamuntjak, ‘Censorship is returning to Indonesia in the name of the 1965
purges’, The Guardian, 27 October 2015.
50. Nurkholis Hidayat, ‘Jokowi’s First Year’. It is worth noting that while the
Islamic Defender Front is a militant group which occasionally attacks minorities, both
Muhammadiya and Nahdlatul Ulama have more modernist and liberal outlooks. Yet,
all of them agreed in opposing an official apology.
51. ‘No need to apologise for 1965 communist purge: FPI’, The Jakarta Post, 1
October 2015.
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IndonesIa 2015
was Christian and from a Singaporean family. Joko Widodo, then, played
the religious card and has been keeping an eye on Muslim forces in an at-
tempt to not displease them. This constant wooing of Sunni Islam, whose
support Jokowi needs, can prove dangerous, especially when it comes from
traditionalist groups, since they are mainly responsible for discriminating
against religious minorities, in particular Shias, Ahmadiyya and Christians.
Jokowi might feel that his hands are tied and might turn a blind eye to
anti-minority religious violence and intolerance.52 Yet, by failing to address
these persistent social issues, Joko Widodo risks paying a high political
price, as people expect his government to perform better than the previous
one towards the creation of a peaceful society and the consolidation of the
country’s democracy.
Therefore, while deciding to please certain forces, Jokowi disappoint-
ed the elements of civil society that had hoped that the new President could
provide a resolution for the past violations. Unfortunately, as further con-
firmation that this was not going to happen, the Ubud Writers and Readers
Festival in Bali, the largest of this type in Indonesia, was forced to cancel
the events dealing with the anti-communist massacres, something unprec-
edented in the twelve-year history of the popular festival.53 In addition to
this, other incidents revealed that the government was not willing to start a
serious debate on the heinous crimes of the New Order: on the contrary, in
the name of silencing the 1965 purges, censorship is being used to enforce
general limitations on freedom of expression.54
By and large, it is difficult to say whether, by promising to offer an
apology, Jokowi simply wanted to gain favour from human rights activists
or if he was sincerely committed to alleviating the suffering of the 1965
victims. Yet, since in the meanwhile he has benefited from the political and
financial backing of personalities of the Jakarta establishment, who were
more or less directly linked to the Suharto’s junta (and who do not easily
accept seeing their power challenged by a potential revisitation of history),
Jokowi was aware of the fact that he was running with the hare and hunting
with the hounds and that he would have to displease one side or the other.
52. See Margareth S. Aritonang & Bagus BT Saragih, ‘Jokowi and Prabowo play
ethnicity, regliious cards’, The Jakarta Post, 18 August 2014; ‘PKB gives Islamic edge
to Jokowi’, The Jakarta Post, 4 May 2015.
53. John Roberts, ‘Indonesian authorities ban discussion’.
54. Laksmi Pamuntjak, ‘Censorship is returning’. A debate over freedom of ex-
pression was kindled in November by a circular issued by the National Police on hate
speech, even though many thought that the President himself was behind it. The cir-
cular, while being praised by human rights activists and minority leaders for creating
a legal framework to condemn discriminations against groups and individuals on the
basis of their ethnicity, religious, sexual orientation, etc., has been criticised because
it considers criticism of government as hate speech and can therefore be misused to
the detriment of freedom of expression. Several saw it as a revival of Suharto-style
restrictions. ‘Banning Hate Speech’, in Jakarta Post, 5 November 2015.
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2.8. Jokowi’s ambivalent attitude on the rise of radical Islam and the IS threat
A major social development of the past years that cannot be ignored
is the alarming influence of radical Islamist organisations in several areas
on the archipelago. In a sprawling and diverse country such as Indonesia,
still characterised in many places by tensions between the local population
and the central government, an already tense situation has been overlap-
ping with IS-promoted terrorism, generating a synergy between these two
phenomena which can be destructive.
The rise of radical Islam is not a new phenomenon in the Southeast
Asian nation, the world’s most populous Muslim-majority country. Indone-
sia’s Islam has historically been moderate, accommodating and diverse,55
and, significantly, did not spread in the archipelago following outside con-
quest but thanks to the preaching of the Sufis. However, starting with the
1980s, namely from the last decade of Suharto’s regime onwards, Indone-
sia was subjected to the influence of Saudi Arabia. This brought about the
creation of Saudi-funded schools and the invasion of the Indonesian cheap
book market with pamphlets and booklets that condemned pluralism, while
promoting Wahhabism.56 Thus, after the Suharto era, powerfully sponsored
by Saudi money and influence, new radical versions of Islam started com-
peting for dominance with the quiet and traditionally tolerant Indonesian
Islam. The Majelis Ulama Indonesia (MUI, Council of Indonesian Ulama),
established in 1975, shifted from a modernist stance to a conservative and
«purer» one. Moreover, Indonesia’s national ideology was increasingly in-
fluenced by arguments according to which the nation should take the form
of an Islamic state. This new ideology has become so influential that some
provinces have introduced the Islamic law.57
What is important to underline here is that MUI has great influence
both at the social and political levels as it defines the parameters of religious
orthodoxy. These parameters, although not legally binding, are kept in con-
sideration by the government, which does not want to alienate Muslim sup-
port. Over the last decade, MUI has become a detractor of pluralism, even
issuing fatwas justifying violence against those who do not comply with the
interpretation of Islam that the organisation promotes.58 Indeed, during
55. See Clifford Geertz’s classical work: Islam Observed. Religious development in
Morocco and Indonesia, New Haven: Yale University Press, 1968.
56. Jane Perlez, ‘Saudis Quietly Promote Strict Islam in Indonesia’, The New York
Times, 5 July 2003; Martin van Bruinessen, ‘Wahhabi influences in Indonesia, real and
imagined’, Summary of paper presented at the Journée d’Etudes du CEIFR (EHESS-
CNRS) et MSH sur le Wahhabisme. Ecole des Hautes Etudes en Sciences Sociales /
Maison des Sciences de l’Homme, Paris, 10 June 2002; Fred R. von der Mehden, ‘Saudi
Religious Influence in Indonesia’, Middle East Institute, 1 December 2014.
57. Adrian Vickers, A History of Modern Indonesia, Cambridge University Press,
New York, 2005, p. 218.
58. Syafiq Hasyim, ‘Majelis Ulama Indonesia and Pluralism in Indonesia’, Philoso-
phy & Social Criticism, May-June 2015, Vol. 41, No. 4-5, pp. 487-95.
170
IndonesIa 2015
the Congress of the Indonesian Muslims held in February 2015 in Jakarta,

MUI, while forgetting to mention the discrimination of non-Islamic minor-
ities in Indonesia, denounced the oppression of Muslims all over the world
and advocated distrusting cultures not in line with the sharia.59 Further-
more, MUI had previously issued a fatwa against pluralism, secularism, and
liberalism, while refusing to do the same against IS.60
This is not to suggest that the version of Islam promoted by MUI is
representative of the majority of Muslims in Indonesia: Indonesian Islam
remains mainly tolerant and moderate and several Muslim organisations
are trying to spread a counter narrative to denounce the IS’s interpretation
of Islam.61 Yet, it cannot be denied that, not surprisingly, MUI advocacy of
a stricter Islam has had negative repercussions over the social fabric, since it
favoured the emergence of hardliner Muslim groups like Laskar Jihad and
the FDI, responsible for the victimisations of religious minorities, or even
organisations like Jemaah Islamyah (JI), linked with al-Qa‘ida and respon-
sible for the bombing attacks of 2000s. Moreover, in the past years, at least
three IS-linked groups have become active in Indonesia: Katibah Nusanta-
ra, Ansharut Daulah Islamiyah, and Mujahidin Indonesia Timur. Katibah
Nusantara, guided by Bahrun Naim, is, according to the New York Times,
«a ‘dedicated Southeast Asian military unit’ under the Islamic State that re-
presents a direct security threat to the region».62 But it is active even outside
Indonesia, having been credited with the capture of part of the territory
formerly held by Kurds in Syria.63 Ansharut Daulah Islamiyah claims to be
the main IS structure in Indonesia. Mujahidin Indonesia Timur (MIT), also
known as East Indonesia Mujahideen, has been linked to lethal attacks on
policemen and organises training camps in Sulawesi Island.64 The MIT is
led by Santoso, one of the most feared Indonesian terrorists, involved in the
Bali bombings of 2002 and 2005, whom the Indonesian security forces, in
59. Al Makin, ‘Islamic Congress Reflects Conservative Influence’, The Jakarta

Post, 14 February 2015.
60. ‘Indonesia fighting against ISIS presence’, AntaraNews, 9 August 2015.
61. For example the moderate organisation Nahdlatul Ulama (NU), which
claims to have more than 50 million members, is engaged in an ideological battle
against IS and wants to circulate a message of tolerance to counter jihadi and extrem-
ist groups in Indonesia and in the world. Its aim is to promote what they consider the
essence of Indonesian Islam, namely Islam Nusantara (the Islam of the East Indies),
based on a more spiritual interpretation, on non-violence, and respect of other reli-
gions. See Joe Cochrane, ‘From Indonesia, a Muslim Challenge to the Ideology of the
Islamic State’, The New York Times, 26 November 2015.
62. ‘More on Katibah Nusantara: Military Unit Under ISIS Linked to Jakarta
Attack’, The New York Times, 14 January 2016.
63. Jasminder Singh, ‘Katibah Nusantara: Islamic State’s Malay Archipelago
Combat Unit’, RSIS, 26 May 2015 (https://www.rsis.edu.sg/rsis-publication/icpvtr/
co15126-katibah-nusantara-islamic-states-malay-archipelago-combat-unit).
64. ‘Mujahidin Indonesia Timur (MIT)’, TRAC – Terrorism Research and Analysis
Consortium, (http://www.trackingterrorism.org/group/mujahidin-indonesia-timur-mit).
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spite of a sustained campaign, have hitherto been unsuccessful in hunting

down.65
Therefore, radicalised Islam and the formation of terrorist groups are
tightly linked and should be equally confronted promptly and effectively. As
a matter of fact, just after becoming President, Jokowi declared that terror-
ism and extremism must be dealt with by combining military resolve with a
«soft approach», which includes the reduction of economic inequality, edu-
cation, law-enforcement, and cooperation with moderate Muslim organisa-
tions.66 Nevertheless, while taking forceful action against global terrorism-
linked groups, the new President has preferred to maintain a cautious and
ambivalent attitude towards the ideological threat of radical Islam. No doubt,
on the one hand, President Widodo has not shied away from using the army
to curb Islamist armed groups. In fact, the military operations launched in
March and at the end of the year under review, although unsuccessful in ap-
prehending the masterminds of the IS-inspired terror strategy, nevertheless
led to the arrest of several militants.67 On the other hand, however, during
the same period Widodo did not take a strong stand at the ideological and
cultural level against FDI and MUI. This could be explained by the fact that,
accused of being a Christian by his rival Prabowo during the presidential
campaign, Jokowi feared that taking a clear stance against Islamic radical
ideology could cast doubts on his religious affiliation and be detrimental to
his quest for consensus. Thus, during his first year in power, the President’s
condemnation of intolerance was not matched with concrete steps to stop
the discrimination against religious minorities or to limit the circulation of
extremist messages.68 By and large, then, notwithstanding the alarming sit-
uation, Jokowi’s reaction to the threat of radical Islam has been strategically
weak. In line with the conduct of the previous Indonesian governments over
the past fifteen years,69 Joko Widodo has insisted on showing Indonesia’s
65. ‘Indonesian forces regroup after failing to capture top militant Santoso’, The
Strait Times, 11 January 2015.
66. Uri Friedman, ‘One President’s Remarkable Response to Terrorism’, The
Atlantic, 15 January 2016.
67. A preliminary interesting analysis can be read in Joe Cochrane and Thomas
Fuller, ‘Jakarta Attack Raises Fears of ISIS’ Spread in Southeast Asia’, The New York
Times, 13 January 2015.
68. Stefanus Hendrianto, ‘The Strange Case of Dr. Jokowi and Mr. Hyde: Re-
ligious Freedom at the Crossroads in Indonesia’, Blog of International Journal of Con-
stitutional Law. 29 December 2015. Note that according to the author of this article,
moreover, the problem of religious intolerance originates from certain structural
constitutional problems that leave space for a restrictive interpretation of religious
freedom.
69. Thus, if on the one hand global-terrorism linked JI has been crushed thanks
to the strong and prompt military intervention, radical Islam promoted by groups
such as FDI has not been prevented from spreading. It is interesting to note that
WikiLeaks documents provide evidence that the police supported the FDI, taking
advantage of their extortion activities and turning a blind eye to their violent actions,
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IndonesIa 2015
military might, but has so far been wavering in condemning and fighting
those elements of ideological extremism which could facilitate the penetra-
tion of Indonesian society by IS-linked terrorist organisations. Although ef-
fective only in the short-term, from the point of view of power consolidation
and consensus gathering, the new President has deemed fighting an enemy
which claims to have links with global terrorism to be more rewarding and
legitimising while presenting it as a threat to national security rather than
trying to uproot radical Islam by ideologically defying it.
2.9. Jokowi’s ambivalent attitude on the Papuan question

Jokowi’s ambivalent attitude can also be seen in the case of the thorny
Papuan question.70 During his electoral campaign the would-be President
paid considerable attention to the outermost region of West Papua. He pre-
sented Papuan grievances as worth lending an ear to and seemed genuinely
willing to find a solution to end the longstanding conflict. That Jokowi has
addressed the problem is undoubtedly a positive aspect per se, since, for the
Indonesian state, West Papua represents a national security issue and any
change in the status quo is considered political taboo. Therefore, the Presi-
dent introduced an element «that could be a determining factor: dialogue».71
In fact, previous governments simply addressed economic issues, but they
did not take into consideration Papuans’ claims or their complex cultural
identity and historical specificity, something that understandably did not
ease the process of pacification. Thus, apart from promoting regional de-
velopment through infrastructure building, the rehabilitation of traditional
markets, a more equitable sharing of resources between centre and periph-
ery, the continuation and implementation of former President Yudhoyono’s
welfare policy,72 and the enforcement of a revision of the 2001 special auton-
since these bestowed the permanence of a more conservative social order. See Bagus
Bt Saragih, ‘WikiLeaks: National Police funded FPI hardliners’, The Jakarta Post, 5
September 2011, quoted in Marco Vallino, ‘Indonesia 2014’, p. 147.
70. Papua is generally used to indicate both Papua and West Papua, the two
provinces that form the West Papua region.
71. Leonard C. Sebastian & Emirza Adi Syailendra, ‘Can Jokowi bring peace to
West Papua?’, The Diplomat, 12 June 2015.
72. In Bobby Anderson’s opinion, Papua and the outermost regions are suffer-
ing in terms of education, health and justice in comparison to the more central ones.
Papua is very rich in resources, but poor in equality and participation. According to
Anderson, in the case of Papua the decentralisation process, which has characterised
the Indonesian political system after the end of the New Order, looks more like an
abdication of the state from its responsibilities than anything else. In this situation,
Papua is considered by the state as a national security issue, whereas its lowest life
expectancy, highest maternal and child mortality and lowest educational level are
not taken into account. See Bobby Anderson, ‘Measuring Democracy in Indonesia’s
Borderlands’, Open Democracy, 5 September 2014.
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ElEna ValdamEri
omy law, Jokowi is trying to find a comprehensive and durable solution.73 For
example, Jokowi proposed building a presidential palace in Papua,74 a meas-
ure also supported by Komnas HAM (the human rights national commission)
in order to give local people more visibility; he announced the suspension of
the discussed transmigration scheme that relocated mainly Javanese farmers
to Papua and contributed to reducing locals to a minority in certain areas,75
perpetuating the imposition of the Javanese ethnocentrism.76 Moreover,
Jokowi declared the end of the restrictions for foreign journalists77 in Papua
and West Papua and, in May, decided to release five political prisoners,78
while promising to free many more activists.79 In fact, in November he also
released Filep Karma, symbol of the independence movement.80 These steps
are undeniably important signals for a region that has for too long been
victimised by a painful internal colonisation and a fierce military repression.
Yet, there are some major problems. Papua is in fact a theatre of multiple con-
flicting interests and agendas and it is difficult to take a stance that pleases all
parties. A very strong hand is needed if things are to change. In the first place,
the presence of the army in the region has not been reduced; on the contra-
ry, despite Jokowi’s efforts to involve the military and the local police in the
dialogue with the local inhabitants, the expansion of territorial military struc-
tures in the region does not contribute to helping the local population regain
trust in the good will of the central government. In fact, security policies
remain in place and counterbalance the beneficial effect of welfare policies.
Such security policies are part of a programme, unfortunately named Serbuan
teritorial («territorial invasion»), promoted by Defence Minister Ryamizard
Ryacudu, who is in favour of greater involvement of the military in civilian
73. Ibid.
74. ‘President Jokowi to Build Presidential Palace in Papua’, Tempo, 5 August
2015.
75. Papua is a frontier economy region that has attracted high immigration.
Data from the Central Statistics Agency revealed that Papua is currently occupied by
1.7 million Melanesians (these are the indigenous ethno-geographic group of the
region known as Melanesia, which includes the Pacific Islands stretching from New
Guinea – whose western part is Indonesian Papua – into the Fiji islands) and 2.3 mil-
lion non-Papuan people, namely economic migrants, coming mainly from Java, Su-
matra, and South Sulawesi. ‘Papuan Students Urge Jokowi to Withdraw the Military
from Papua’, Tempo, 4 September 2015.
76. ‘President Jokowi Stops Transmigration Program to Papua’, Tempo, 4 June
2015; Jenny Munro, ‘The President and the Papua Powder Keg’, New Mandala, 24
June 2015.
77. Accredited correspondents had to ask for special permission from the Intel-
ligence Agency and the national police before visiting and reporting about the area.
78. ‘Another Try’, Tempo, 21 May 2015.
79. ‘RI expected to release more Papuan political prisoners’, The Jakarta Post,
24 November 2015.
80. ‘Indonesia releases prominent West Papuan pro-independence leader Filep
Karma from jail’, ABCNews, 19 November 2015.
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IndonesIa 2015
life.81 The purpose of the programme is to increase the social functions of

the military in the outermost, conflict-prone areas – and thus also in Papua
– and improve the soldiers’ image among the locals. But, according to many
analysts, it is exactly the opposite of what is needed to stop abuses of pow-
er.82 Therefore, Jokowi’s agenda is at odds with the agenda of the generals,
some of whom, like Ryamizard, are also members of his Cabinet. Moreover,
both the Minister of Defence and the Commander of the Indonesian Armed
Forces (TNI) publicly denied that the veto on foreign journalists in Papua
had been lifted. On the contrary, they declared that permission would still be
needed and «good reports» (that is to say nothing which questions the official
narrative) must be produced.83 Also Jokowi’s plan to grant amnesty to around
ninety Papuan political prisoners was rejected by the House of Representa-
tives.84 Another contradictory fact was that the President, albeit professing
to be determined to combat the discrimination against Papuans, denied the
latter’s claims to Melanesian cultural identity and refused to acknowledge
any special relationship to Melanesia. In fact, Jokowi successfully exerted his
pressure over the Melanesian Spearhead Group (MSG)85 in order to prevent
the United Liberation Movement of West Papua (ULMWP), namely an um-
brella group formed in 2014 that gathers different organisations fighting
for Papuan independence from Indonesia,86 from becoming full members.
At the same time, Indonesia obtained the status of associate member in the
MSG.87 This was a political victory for Joko Widodo: indeed, by granting
ULMWP only the status of observer, the MSG made clear that it recognised
81. Stephen Hill, ‘Papuans and Jokowi are hostage to Indonesian Politics’, The
Conversation, 1 June 2015.
82. See Jenny Munro, ‘The President’. Of course, Papuans too keep on asking
for a reduction in the presence of the military: according to data, more than 500,000
people have been killed since 1963 and killings of civilians continue but rarely are
they punished. ‘Papuan Students Urge Jokowi’.
83. ‘Foreign media should obtain permits to cover Papua: Chief minister’,
Antara News, 11 May 2015.
84. ‘House rebuffs plan to pardon Papuans’, The Jakarta Post, 23 June 2015. The
House of Representatives summoned House Commission I in order to discuss the
matter. The latter decided that a refusal of the government’s proposal was necessary
in order to avoid the further spread of separatist activities in the region. Note that
every member elected to the House is assigned to work in a particular commission
according to their expertise. Overall, there are eleven commissions. Commission I
deals with issues related to defence, intelligence, foreign affairs, communications and
information. See ‘Indonesian Elections 101: The House of Representatives’, The Wall
Street Journal, 4 April 2014.
85. The Melanesian Spearhead Group is an informal regional group, some of
whose member states support West Papuan independence from Indonesia.
86. On the ULMWP’s creation see ‘West Papuans Unite under a New Umbrel-
la Group’, Free West Papua Campaign, 7 December 2014 (https://www.freewestpapua.
org/2014/12/07/west-papuans-unite-under-a-new-umbrella-group/).
87. ‘A Noble Cause in the Melanesian Spearhead Group’, The Jakarta Post, 23
July 2015; Jenny Munro, ‘The President’. The decision on Papuan representation
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ElEna ValdamEri
Indonesia’s sovereignty over Papua. In other words, Jakarta was acknowl-

edged as the legitimate representative of the five Melanesian provinces in the
archipelago, while the ULMWP was denied its prerogative to speak on behalf
of all the West Papuan Melanesians.88 In addition to this, the Indonesian
President was trying to tighten the economic ties with Papua New Guinea to
undermine this nation’s support of Indonesian Papuans.89 This ambiguity
and the lack of a shared vision within the government was not encouraging
for those who had set high expectations on Jokowi.
Also the presence of powerful international companies is a factor with
serious complications in the area. West Papua has always kindled much in-
terest for its enormous mineral wealth90 and since the 1960s, under Suhar-
to, the region experienced an influx of American, European, and Japanese
companies,91 but hardly ever did the locals benefit from their own resourc-
es. For example, in the case of Freeport Indonesia, a unit of the gigantic
American mining company Freeport McRohan, Papuans complained that,
in terms of employment, they are discriminated against in favour of immi-
grant workers; they also reported that local government is rarely involved
in negotiations related to companies working in the region.92 Moreover,
the implementation of expansion schemes for palm oil production have
brought the swift penetration of multination industrial producers. This, not
surprisingly, has been damaging to local smallholders, constrained by the
insufficient expertise, fertilisers and other fundamental inputs. If the needs
of local communities are not taken into consideration, these economic poli-
cies are likely to alienate Papuans’ trust in the central government’s devel-
opment policies. In addition to this, lack of transparency in land acquisi-
tions by companies to the detriment of land rights of smallholders have
spurred conflicts that can destabilise the areas.93
was made during the MSG’s 20th Summit, which took place in the Solomon Islands
in June 2015.
88. The ULMWP is an umbrella group formed in 2014 that gathers different or-
ganisations fighting for Papuan independence from Indonesia. See the press release
at ‘West Papuans Unite under a New Umbrella Group’, Free West Papua Campaign,
7 December 2014 (https://www.freewestpapua.org/2014/12/07/west-papuans-unite-
under-a-new-umbrella-group/).
89. Stephen Hill, ‘Papuans and Jokowi’.
90. Besides natural gas, nickel, silver, fish, oil, and timber, the region’s moun-
tains contain the world’s largest gold mine and the second largest copper mine, both
operated by a subsidiary of U.S. mining conglomerate Freeport McMoRan (Sally An-
drews, ‘Papua’s Hidden Past Haunts Jokowi Presidency’, The Diplomat, 24 January
2015).
91. Ibid.
92. ‘Papuans want Freeport to Open Local Office’, Tempo, 26 October 2015;
‘Papua ready to Buy Freeport Shares, Charles Simaremare Says’, Tempo, 26 October
2015.
93. Agustina YS Arobaya and Freddy Pattiselanno, ‘Is Oil Palm the Answer for
Rural Poverty in Papua?’, The Jakarta Post, 9 June 2015.
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IndonesIa 2015
2.10. Jokowi’s ambivalent attitude on the «haze crisis»

Both the questions of land ownership and production of palm oil are
crucially linked to the disastrous «haze crisis» which was caused by forest fires
which burned from June to December 2015. 94 These fires blanketed a great
part of Southeast Asia, stirring diplomatic tensions with the neighbouring
countries95 and placing the Indonesian President under global spotlights. On
the one hand, fires are set in cases of disputed ownership to claim one’s right
over a certain land; on the other hand, the fires clear the land for the planta-
tion of trees for pulp and paper, but above all, for oil-producing palms.96 Both
smallholders and plantation companies – the former having less resources at
their disposal, for survival,97 the latter driven by the logic of profit – turn to
burning instead of cutting, because it is extremely cheaper and faster.98 In-
vestigations have shown that plantation companies, by paying families to set
fires to land, have fed a mafia of farmer group organisers, village heads, land
claimants, businessmen, and government officers who benefit enormously
from the fires.99 Despite the dreadful extent of the ecological disaster – whose
gravity, it is worth mentioning, pushed the President to shorten his official
visit to Washington at the end of October – Jokowi did not declare a state of
emergency, lest companies could default from contracts;100 this caused di-
smay, especially in West Papua, which was badly damaged by the fires.
94. The fires hit mainly West Papua, Kalimantan and Sumatra. George Mon-
biot, ‘Indonesia is burning. So why is the world looking away?’, The Guardian, 30
October 2015. The World Bank estimated that the haze fires from June to October
2015 had caused Indonesia damages worth 221 trillion rupiah (around US$16 bil-
lion) to agriculture, forestry, transport, trade and tourism, short-term school closures
and health impacts. ‘Indonesia’s Fire and Haze Crisis’, The World Bank, 25 November
2015. Note that it is misleading to call the fumes haze: actually it is noxious smoke
that has caused serious illness and several deaths. See Gabriel Dominguez’s interview
of scientist Louis Verchot: ‘«It’s not just haze, it’s noxious smoke» – A look at Indone-
sia’s forest fires’, Deutsche Welle, 30 October 2015.
95. In particular, Singapore threatened legal action against companies that
work in Indonesia and that seem to be linked to the fires. See Bill Laurance, ‘Feeding
«Godzilla»: as Indonesia burns, its Government moves to increase forest destruction’,
The Conversation, 23 November 2015.
96. Indonesia and Malaysia alone account for 85% of the world’s palm oil out-
put. Augustinus Beo da Costa, ‘New palm oil council would drop «no deforestation»
pledge – Indonesia’, Reuters, 14 October 2015.
97. ‘Efforts to Stop Indonesian Haze Fires May Not Work for 2016’, Tempo, 18
December 2015.
98. Cutting forests is 20 times more expensive than burning them, in Neil Chat-
terjee, ‘World’s oldest rainforests burn as Jokowi scales back Promises’, Bloomberg, 1
October 2015.
99. Ibid.
100. ‘Jokowi leaves COP21 talks as questions remain over Indonesia haze re-
forms’, Mongabay, 2 December 2015 (http://news.mongabay.com/2015/11/jokowi-
turning-over-a-new-leaf-for-indonesia-on-haze-but-details-still-foggy/).
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ElEna ValdamEri
In this situation, the President took action to try to solve the crisis
and defeat the haze problems within three years. In the first place, he ac-
knowledged that unclear land tenure and concessions were at the root of
the problem, announcing the mapping of land ownership, which should be
carried out by 2020;101 secondly, the government froze permits to four of
the companies suspected to be errant and criminal cases were filed against
their executives;102 moreover, the Forestry Minister issued new technical
guidelines that should contribute to reducing fire risks in the forthcom-
ing years.103 Yet, analysts have expressed concern about Jokowi’s ability to
implement central government policies at the local level, something made
difficult by the decentralisation, which Indonesia underwent after the Su-
harto era.104 Moreover, the decision jointly made by Malaysia and Indo-
nesia to create a Council of palm oil producer countries105 was received
with generally disappointment: in fact, this seemed to go against important
agreements aimed at reducing deforestation106 and to contradict Jokowi’s
declarations at Cop21 in Paris that local communities must be involved in
order to pursue a more sustainable economy.107 Once again, it was not clear
where Jokowi was heading. The risk is that welfare policies would be of no
use if not backed by a durable and inclusive development scheme that, es-
pecially in critical West Papua, values and protects the environment as the
fundamental resource of local communities.
101. Neil Chatterjee, ‘World’s Oldest Rainforests’.

102. ‘Efforts to Stop Indonesian Haze Fires’.
103. ‘Jokowi leaves COP21 talks’.
104. After the fall of autocrat Suharto, who established a heavily centralised
rule which lasted more than 32 years, the central government has devolved powers
to the regional level, giving local leaders more authority to hasten the process of
democratisation. This was a necessary measure to counter the pressure for secession
exerted by several provinces. Therefore, Indonesia today is highly decentralised. De-
centralisation – necessary in an archipelago as huge and disperse as Indonesia – al-
lows for the rise of leaders such as Joko Widodo and fosters a bottom-up democracy.
See Keith Green, ‘Decentralisation and Good Governance: the Case of Indonesia’,
MPRA, October 2009 (https://mpra.ub.uni-muenchen.de/18097/1/Decentraliza-
tion_and_Good_%20Governance-the_Case_of_Indonesia.pdf). For the penetration
of corruption at the local level, following the decentralisation process, see e.g. Joshua
Kurlantzick, ‘Indonesia: the Downside of Decentralisation’, The Diplomat, 5 Septem-
ber 2012.
105. The new Council functions as a sort of OPEC, namely promoting the im-
age of palm oil, stabilising prices, improving cooperation between top producers, and
coordinating on production, stocks, biodiesel regulations and re-plantation schemes
(Augustinus Beo da Costa, ’New palm oil council’).
106. Bill Laurance, ‘Feeding «Godzilla»’. In particular, the Council seems to
rebuff the Indonesian Palm Oil Pledge (IPOP) signed by big palm oil producing com-
panies which, under international pressure, commits to adopting better practices in
terms of eco-sustainability and inclusivity of smallholders.
107. Ibid.
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3. The regional elections
Late in 2015, millions of Indonesians voted in regional elections,

which were held in about half the local administrations of the country. This
was just the first of three rounds: the two remaining ones are scheduled to
take place in February 2017 and June 2018.108 What is important to note is
that, contrary to the attempt by the Prabowo Subianto’s coalition to elimi-
nate local elections during the transition period, these were maintained. In
fact, owing to an enormous public outcry, Yudhoyono soon had to overturn
the unpopular move and restore the pilkada system (local elections system).109
Since 2005, this allows electors to choose local administrators directly and is
a fundamental safeguard of bottom-up democracy. The fact that local elec-
tions were retained was a personal victory for Jokowi, who had loudly de-
cried the anti-democratic measure.110 These elections cannot be considered
a referendum over Jokowi’s first year for two main reasons.111 The first one
is that single candidates are more important than parties.112 The second
one is that just half the country will be involved during this round. Yet, re-
sults matter because the winners could implement or stall Jokowi’s propos-
als at the local level, therefore being either a consolidation or a destabilising
factor for the President.113
4. Foreign policy: «In the Ocean we triumph»114
If we look at Indonesian foreign policy, we can see that Joko Wido-

do seeks to present himself as a promoter of considerable change. Never-
theless, there are many elements of continuity with Yudhoyono’s foreign
108. David Ennis, ‘Indonesia’s 2015 Regional Elections’, International Founda-

tion for Electoral Systems, 10 December 2015 (http://www.ifes.org/news/indonesias-2015-
-regional-elections).
109. ‘Indonesia retains direct elections for regional leaders’, BBC News, 20
January 2015.
110. It was thanks to that system of direct elections that Jokowi was elected
mayor of Solo and then governor of Jakarta.
111. The first partial results have shown that the general winners are those who
were already in power. Hans Nicholas Jong, Haeril Halim & Fedina S. Sundaryani,
‘Incumbents entrance rule’, The Jakarta Post, 10 December 2015.
112. ‘Candidates play bigger role than political parties’, The Jakarta Post, 9 De-
cember 2015.
113. Local leaders can propose bills and regional budgets and plan local infra-
structure. Very influential are those who are in power in provinces rich in coal, palm
oil, and minerals and where industries process and export such commodities.
114. This is a slogan dating back to Sukarno’s time that Jokowi adopted in his
inaugural address as President of the Republic of Indonesia. See the official transcript
at ‘Jokowi’s inaugural Speech as Nation’s Seventh President’, The Jakarta Globe, 20
October 2014.
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ElEna ValdamEri
policy. This is evident both in the new President’s maritime vision and in
the emphasis on the need for varying and expanding bilateral relationships
with partner countries. Three main points will be analysed in the following
section. First, it will be seen how Jokowi has been trying to sensitise the
general public on issues concerning maritime vision and security and to
depict Indonesia as a country that can serve as a bridge between the Pacific
and Indian Oceans. Second, Indonesia’s bilateral relations will be taken into
account. Greater prominence will be given to the relations with China and
US. It will be shown that, in a period of growing geopolitical tensions at the
international level, Indonesia is not willing to choose between the US and
China. As a matter of fact, Jakarta prefers not to take a clear-cut stance and
nor be drawn into a rivalry that might cost a great deal in terms of sover-
eignty and independence. Not unlike the other ASEAN countries’ leaders,
Widodo does not ignore the complexities of the interwoven conflicts of in-
terests in the regional scenario and is trying to take advantage of the pro-
posal advanced by both US and China, avoiding upsetting either. Ultimate-
ly, Jokowi’s attitude towards the ASEAN group will be considered. Certain
declarations by the new President and his entourage suggest that Indonesia
might abandon its traditional role of mediator in the region and focus on
its national interests, while strengthening its position in the regional area.
4.1. Jokowi’s maritime vision

At this point, it is important to briefly focus our attention on Joko
Widodo’s maritime vision. Jokowi wants to transform Indonesia into a «glob-
al maritime axis», namely a powerful and dynamic maritime hub, equipped
with a developed modern infrastructure.115 His political manifesto gave mo-
mentum to ideas which were not new but had been discussed only at the
high-politics level. As a matter of fact, during his presidential campaign, the
issues of maritime strategy and maritime security were encompassed in the
broader political discourse for the first time.
The President’s vision is predicated on three main principles: 1) im-
provement of infrastructure to enhance inter-island connectivity in order
to integrate the outermost areas of Indonesia, improving trade and com-
merce, thanks to a better use of choke points and maritime corridors;116
2) expansion of regional diplomacy in the area of the Indian and Pacific
Oceans, making Indonesia a fulcrum between India and China and be-
tween China and the US;117 3) projecting Indonesia as a maritime power
whose naval capability will be increased in the forthcoming years.
115. ‘Jokowi launches Maritime Doctrine to the World’, The Jakarta Post, 13 No-
vember 2014.
116. Vibhanshu Shekhar & Joseph Chinyong Liow, ‘Indonesia as a Maritime
Power: Jokowi’s Vision, Strategies, and Obstacles Ahead’, Brookings, November 2014.
117. Joshua Kurlantzich, ‘Jokowi’s Maritime Doctrine and What It Means’, The
Diplomat, 29 November 2014.
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IndonesIa 2015
As analysts maintain, the new emphasis placed on maritime vision is

a by-product of the growing awareness of the maritime vulnerability of In-
donesia given the alarming tension in the South China Sea and the rise of
China and India: a stronger awareness of the archipelago being exposed to
external threats is constitutive of the country’s deep-seated sense of vulnera-
bility towards its maritime domain.118 Moreover, while underlining the need
to overcome what has been an anomaly for the world’s biggest archipelagic
state, namely a strategy predicated on a continental army,119 Jokowi rein-
vigorates Mohammad Hatta’s «between the two continents and two Oceans
worldview», according to which Indonesia’s geographical cross-road loca-
tion shapes its «independent and active foreign policy». 120
The implementation of this maritime vision would hardly be possi-
ble without the modernisation of the Indonesian navy, which – it is worth
remembering – is weaker than those of Singapore, Vietnam or Thailand.
Former President Yodhoyono had already started a twenty-year programme
(2005-2024) focused mainly on the improvement of the naval and air forces.
Thank to this plan, called «Minimum Essential Force» (MEF), some progress
has been made and a few warships and submarines have been acquired.121
This notwithstanding, because of the limited resources allocated and the
lack of coordination, the programme has left much to be desired. There-
fore, Jokowi’s intention was to push it forward.122 The President’s elabora-
tion of an ideological framework in which maritime security is depicted as a
national interest priority is functional to gain political support and to sen-
sitise people through a mainstream public debate. The above-mentioned
sinking of illegal fishing vessels, for instance, could be interpreted as part
of this strategy.
In order to improve maritime coordination, soon after being elected,
Jokowi created a new maritime security agency, called Bakamla, to replace the
previous agencies, whose tasks were not clear and often overlapped. Bakam-
118. Leonard C. Sebastian, Ristian Atriandi Supriyanto, & I. Made Andi Ar-
sana, ‘Indonesia and the Law of the Sea: Beyond the archipelagic outlook’, National
Security College Issue Brief, No. 9 (May 2014), p. 70
(http://nsc.anu.edu.au/documents/Indonesia-Article9.pdf).
119. Kurlantzich, ‘Jokowi’s Maritime Doctrine’. This was consequence of the
Suharto-era perception that the biggest threats for the nation could come from the
margins of the archipelago, namely from Papua, Aceh and Timor.
120. Vibhanshu Shekhar & Joseph Chinyong Liow, ’Indonesia as a Maritime
Power’. Mohammad Hatta, who fought for Indonesian independence and served as
Prime Minister in 1948 and 1949, during the Cold War, formulated a foreign policy
doctrine that is influential even today in the archipelago. See Mohammad Hatta,
‘Indonesia’s Foreign Policy’, Foreign Affairs, April 1953, Vol. 31, No. 3, pp. 441 452.
121. ‘Tough Times Ahead for the Indonesian Navy?’ The Diplomat, 18 August
2015.
Power’.
181
ElEna ValdamEri
la’s priorities were securing Indonesian resources against illegal fishing,

building up maritime defence and preserving territorial integrity, conducting
patrols and exercises and cooperating with Customs and with the Ministers of
Transportation and Maritime Affairs.123 Secondly, Jokowi announced his will
to double the defence budget from 0.9% to 1.5% of the GDP in five years.124
In 2014, Indonesia met 38% of its MEF objective, with the aim of reaching
100% by 2019.125 All this considered, Joko Widodo’s five years in office will
be pivotal for the realisation of his vision. Yet, it will be a tough test for the
President, since, as noticed by many, there are several roadblocks ahead.
In the first place, doubts have been raised about the possibility of
doubling the financial resources allocated to the armed forces. Moreover,
it is not to be forgotten that Ryamizard will try to redirect most of these
additional resources to the TNI rather than to the Navy. Also, the idea is
widespread that the country might not be able to develop the necessary
technological know-how to reach the goal of entirely relying on the indige-
nous shipbuilding industry. Finally, the common sense is that Joko Widodo’s
lack of the necessary experience in foreign affairs will prevent him from
acquiring national and international credibility.126
4.2. The Indonesia-China relations

The clash with the Defence Minister should not be underestimated,
since it has influenced many domestic policy-related issues.127 Also as far as
the South China Sea dispute is concerned, the positions of Ryamizard and
Jokowi have been at odds. It is well-known that according to the so-called
«Nine-Dash Line», the vague boundary used on official Chinese maps, about
90% of the South China Sea belongs to the People’s Republic of China.128
Within the area on which China lays claim, lie the Indonesian Natuna Islands,
where Jakarta has established an Exclusive Economic Zone. Therefore, while
the Minister of Defence announced that the deployment of a fleet of jet fight-
ers and three corvettes to the islands is planned, as well as the upgrading of
123. Interview with the Minister of Maritime Affairs and Fisheries; Susi Pudjias-
tuti, ‘Implementing the Indonesian Vision’, The Worldfolio, March 2015.
124. The lowest in ASEAN in 2014. See Zachary Abusa, ‘Analyzing Southeast
Asia’s Military Expenditures’, Cogitasia, 7 May 2015.
125. Kennial Caroline Laia & Yeremia Sukoyo, ‘Ryamizard pushing for Indone-
sian defence budget increase citing shortfall’, The Jakarta Globe, 5 November 2014.
Power’. See also ‘Imported Components Dominate Shipbuilding Industry’, Tempo,
14 May 2014.
127. See above on the issues concerning West Papua and the apology for the
1965 massacres.
128. For a brief overview of the SCS issue see ‘South China Sea tensions toned
down at security summit’, The Economist Intelligence Unit, 3 June 2015. For a more
detailed one, see Giulio Pugliese, ‘Japan 2015: Confronting East Asia’s Geopolitical
Game of Go’, in this same volume.
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IndonesIa 2015
the small military force based there,129 the President was more careful. During
his official visit to Beijing in March, Jokowi apparently did not discuss with Xi
Jinping the issue of the disputed sea area and a number of MoUs were signed
on questions of finance, industry, infrastructure, natural disaster management
and aerospace. Later on, in an interview with a Japanese newspaper, the In-
donesian President was reported as saying that China’s claim over the South
China Sea does not have any legal foundation in international law. However,
Jokowi soon clarified that his statement, rather than being against the Chinese
posture, was meant to emphasise the fact that a Code of Conduct was needed
for tackling the South China Sea dispute.130 Joko Widodo, thus, is aware of
the complexities of the relationship with China, whose foreign investments
he wants to attract, and that is maybe the reason why he is reluctant to play
a leadership role within the ASEAN group and to act as spokesperson of the
other member countries who have grievances against the Asian superpower.131
All in all, however, the relationship with Beijing is strengthening, as
shown by the fact that Jokowi visited China twice during 2015 and that, in Oc-
tober, the latter offered up to US$ 100 billion in total investments in several
projects, including joint-venture infrastructure development projects, such as
the bullet train connecting Jakarta and Bandung.132 Moreover, in November,
during the G20 meeting in Antalya, Jokowi and Xi discussed the possibility
of liquidity support with an additional contribution of US$ 20 million as part
of an attempt to reduce Indonesia’s dependence on the US dollar.133 Consid-
ering that Jokowi has rightly declared that infrastructure is at the top of his
priorities, Indonesia seeks to take advantage of the will to invest in the Asian
colossus, which is one of Indonesia’s biggest investors.134
129. ‘Indonesia looks to boost defences around Natuna Islands in South China
Sea’, The Japan Times, 16 December 2015.
130. ‘Xi Jinping hosts Jokowi in Beijing’, The Jakarta Post, 27 March 2015.
131. Yenni Kwok, ‘Four Priorities for Indonesian President Joko Widodo as he
arrives in Washington’, Time, 25 October 2015.
132. Gatra Priyandita, ‘Don’t expect too much from growing Sino-Indonesia
ties’, EastAsia Forum, 7 November 2015. The Jakarta-Beijing relationships had al-
ready improved under former president Susilo Bambang Yudhoyono, following a
comprehensive strategic partnership in 2013, which regulated cooperation in areas
such as defence and scientific research. The competition for the Bandung-Jakarta
high-speed train project was won by China over Japan and perceived as a blow to
Shinzō Abe’s administration, which had proposed an even faster bullet train; ‘Abe
expresses disappointment over high-speed rail to Jokowi’, Today, 23 November 2015.
According to Wellian Wiranto, an economist at Oversea-Chinese Banking Corp. in
Singapore, Jokowi is taking advantage of the Japan-China political rivalry to try to
obtain more investment from China, which is willing to unseat Japan, Singapore, and
South Korea as main sources of Indonesia’s investment. Chris Brummitt, ‘Desperate
for Investment, Indonesia Plays China vs Japan’, Bloomberg, 20 May 2015.
133. Khoirul Amin, ‘Indonesia eyeing more investment from China’, The Ja-
karta Post, 20 November 2015.
134. China is in the top ten list of Indonesia’s investors. See Marius Toime &
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ElEna ValdamEri
4.3. The Indonesia-US relations

It is too early, though, to tell whether Jokowi will abandon the tra-
ditional role of regional mediator played by Indonesia or if he will move
towards either the US or China, becoming part of the spheres of influence
of either power.135 For the time being, despite great expectations, Washing-
ton has been disappointed by the hesitating attitude of the archipelagic
country. During Joko Widodo’s visit to the US in October 2015, Washington
and Jakarta signed a MoU on maritime cooperation which covered bro-
ad priority areas such as maritime security, law enforcement institutions,
and technical skills. Nevertheless, a new work plan which was supposed to
provide the recently-created Bakamla with institutionalised assistance from
the US did not come up for discussion because, for reasons which are not
very clear, it had been cancelled by Indonesia.136 While it has been said
that this is explainable by a struggle for authority within the Bakamla, it
is likely that Jakarta does not want to depend upon Washington too much
to avoid being too closely integrated inside the US sphere of influence. Li-
kewise, Jokowi’s announcement on being keen on joining the TPP has not
been followed by concrete steps, at least so far. Apparently, then, like other
countries in South-East Asia, Indonesia is also struggling to find a balance
between strengthening defence cooperation with Washington, while establi-
shing economic ties with China.137
Ashley Howard, ‘Commentary: Closer China-Indonesia Ties a Promising Work in

Progress’, The Jakarta Globe, 20 May 2015.
135. Hendrajit, ‘President Jokowi should realise the danger of TPP for Indonesia
(Ahead of G-20 summit in Turkey)’, Global Review, 12 November 2015; see also Craig
P. Oehlers, ‘Little to celebrate about Jokowi meeting with Obama’, The Jakarta Post, 31
October 2015, according to which «there is little to suggest a substantial improvement
will occur in Indonesia’s strategic engagement with the US over the next few years.
Indonesia will be glad to accept US assistance in building Indonesia’s maritime and
defence capabilities but not to the point that it will use those enhanced capabilities to
actively assist the ‘US rebalancing’ in the Asia Pacific region against China».
136. The Joint Statement for Comprehensive Defence Cooperation is aimed at
strengthening existing defence ties in terms of maritime peacekeeping, humanitar-
ian assistance/disaster relief, defence modernisation, and countering transnational
threats. US Department of Defence, Readout of Secretary Carter’s Meeting with Indo-
nesian Minister of Defense Ryamizard, 26 October 2015 (http://www.defense.gov/News/
News-Releases/News-Release-View/Article/625985/readout-of-secretary-carters-meet-
ing-with-indonesian-minister-of-defense-ryamiz). See also Prashanth Parameswaran,
‘The New U.S.-Indonesia Strategic Partnership after Jokowi’s Visit: Problems and
Prospects’, Brookings, 8 December 2015.
137. On the one hand, Washington is trying to mobilise ASEAN countries of-
fering maritime assistance, supporting the creation of a CoC and exhorting them
to join TPP or the Expanded Economic Engagement as part of its ‘Pivot to Asia’
agenda. Andrew Elek, ‘US commits to ASEAN integration’, EastAsia Forum, 25 No-
vember 2012. On the other hand, Beijing is using to its own advantage, its financial
might, in order to hinder regional opposition and pushing the Chinese free trade
184
IndonesIa 2015
4.4. The Indonesia-ASEAN relations

Furthermore, it has been observed that the Indo-Pacific vision implies
a broader landscape for strategic action and allows Indonesia to project it-
self as a maritime power outside ASEAN, which, according to some sections
of the strategic circles, is too constraining.138 As declared by Rizal Sukma,
one of Indonesia’s leading strategic experts, ASEAN is an important focal
point, but only one.139 What has been seen so far is that certain statements
released by Jokowi as soon as he took office gave the impression that In-
donesia might change its attitude towards the ASEAN and cease to have a
unifying function. During the ASEAN summit in Myanmar in November
2014, Jokowi said that Indonesia is not willing to become merely a market
and that the country must ensure that no harm comes to its national in-
terests.140 Is this sheer rhetoric to impress Indonesian public opinion and
neighbouring countries or is it a concrete sign that Jakarta is embracing
a broader vision and that its focus on the so-called PACINDO (the Pa-
cific and Indian Ocean region) will entail turning away from the South
East Asian regional cooperation?141 In any case, such declarations are not
very promising in view of the full implementation of the ASEAN Economic
vision as per Free Trade Area of the Asia-Pacific (FTAAP) and ‘One Belt, One Road’
(OBOR) vis-à-vis the US-promoted TPP (Julkifli Marbun, ‘Xi warns of rival free trade
pact «fragmentation», Republika, 18 November 2015. See also Bert Hofman, ‘China’s
One Belt One Road Initiative: What we know thus far’, The World Bank, East Asia &
Pacific, 12 April 2015); Praveen Menon, ‘ASEAN defence chiefs fail to agree on South
China Sea statement’, The Global Review, 4 November 2015; Hendrajit, ‘Indonesia
should play active roles in holding ASEAN-Russian strategic partnership’, The Global
Review, 7 September 2015. Moreover, it is worth mentioning that Indonesian and
American navies earlier in 2015 cooperated in exercises in the South China Sea and
Indonesia Navy spokesman Manahan Simorangkir declared that more joint exercises
are planned and should become routine. See ‘Indonesia eyes regular navy exercises
with U.S. in South China Sea’, Reuters, 13 April 2015. Nevertheless, in October, Gen-
eral Gatot Nurmantyo, advised other countries against engaging in naval activity in
the disputed maritime zone. Gatot further announced that the TNI, in the interest
of pursuing «stability», would reject invitations to the Indonesian Navy to take part
in joint military exercises in the South China Sea. Craig Oehlers, ‘Little to celebrate
about Jokowi meeting with Obama’. Significantly, such declarations were released
in October soon after the USS Lassen, a guided missile destroyer, was provocatively
sent by the US navy within the area of the 12-nautical mile limit of one of China’s
islets. For an analysis of the issue see Helen Cooper and Jane Perlez, ‘White House
Moves to Reassure Allies With South China Sea Patrol, but Quietly’, New York Times,
27 October 2015.
138. Vibhanshu Shekhar & Joseph Chinyong Liow, ‘Indonesia as a Maritime
Power’.
139. Ina Parlina, ‘Low Defense Budget Hampers Ability’, The Jakarta Post, 3
April 2014.
140. ‘A blunt message for ASEAN’, The Jakarta Post, 13 November 2014.
141. Prashanth Parameswaran, ‘Is Indonesia turning away from ASEAN under
Jokowi?, The Diplomat, 18 December 2014.
185
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Community (AEC). Other declarations released by the Minister of Culture

demanding that, since Indonesia will be the centre for economic devel-
opment among the group, Bahasa Indonesia should become AEC’s main
language were not fostering unity and trust, and suggested that Indonesia
was acquiring a self-centred posture and abandoning regionalism.142 This
big-brother behaviour might exacerbate fissures that are already present
within the ASEAN group. In fact, although such statements might remain
confined to the rhetorical level, in the current tense climate it might stall
regional cooperation and harden postures related to the several territorial
disputes already dividing the member states. All in all, this can make the
regional countries more vulnerable to the powerful sway exerted by the US
and China.
4.5. Indonesia’s other bilateral ties

By and large, Joko Widodo has not neglected other bilateral ties, apart
from those with the US and China. Those with Iran, Australia, Russia, and
India are examined in the present section. The visit of the Iranian President
and the Foreign Minister to Indonesia in April indicated the mutual will to
strengthen relationships in terms of regional security, infrastructural and
technical projects and in anti-terrorism cooperation.143 The political shift
with Jokowi was also perceived as timely by Australian new Prime Minister
Malcolm Turnbull in order to reset relationships which had been marred
during Abbott’s government.144 Another very important step occurred in
142. ‘Push for Indonesian to be AEC’s main language’, The Jakarta Post, 18 Au-
gust 2015. Bahasa Indonesia is different from broader Bahasa that includes the lin-
guistic variations spoken in Thailand, Malaysia, Philippines and Indochina.
143. ‘Iran, Indonesia to enhance relations: Zarif ’, PressTV, 14 October 2015;
‘Envoy: Iran, Indonesia cooperating to fight extremism, terrorism’, The Iran Project,
12 November 2015 (http://theiranproject.com/blog/2014/11/12/envoy-iran-indone-
sia-cooperating-to-figt-extremism-terrorism). It is worthwhile to mention that Indo-
nesian Minister of Foreign Affairs Retno Marsudi has been sent by the President to
mediate between the King of Saudi Arabia and the Iranian President after the rise in
tension caused by the execution of a Shiite cleric by Saudis. This means that Indone-
sia is keen to see stability in the area. ‘Jokowi Sends Foreign Affairs Minister to Ease
Saudi-Iran Tension’, Tempo, 10 January 2015. Hassan Rouhani’s visit took place on
the sidelines of the 60th anniversary of the Bandung Conference.
144. This fracture was especially due both to the disagreement over the military
defence of Australian coasts from asylum seekers’ boats, which Canberra wanted to
send back to Indonesia, and by revelations of US attempts at spying on Yudhoyono,
his wife and other personalities of the former President’s closer circle, using the Aus-
tralian Embassy in Jakarta. In April, diplomatic tensions were exacerbated by the
executions of two Australian nationals for drug trafficking, after which the Austra-
lian ambassador to Indonesia was recalled and official ties were put on hold for four
months. Katharine Murphy, ’Malcolm Turnbull arrives in Indonesia on mission to
heal relationship’, The Guardian, 12 November 2015. See also ‘Australian Leader Vis-
its Indonesia in Bid to Repair Ties’, Tempo, 13 November 2015.
186
IndonesIa 2015
June, when Jakarta signed a MoU with Moscow in the field of nuclear ener-
gy.145 Russia is also considering helping Indonesia with military equipment
and contributing to the development of her infrastructures.146
Moreover, India has also been an object of greater attention, espe-
cially as far as defence partnership is concerned. In August 2015, Indo-
nesian Defence Minister Ryamizard and India’s ambassador to Indonesia,
Gurjit Singh, held a meeting during which they signed a MoU focusing on
maritime security and on the will to promote future cooperation in defence
procurement.147 This could bring mutual advantages, since Narendra Modi,
the Indian Prime Minister, wants to increase naval cooperation with South-
east Asia as per his «Act East» policy, whereas Jakarta, as mentioned above,
is willing to enhance its naval capabilities.148
Note must be taken of the fact that during Jokowi’s first year in office,
an improvement has been noticed in the diplomatic relationships between
Indonesia and Malaysia. Although the situation remains tense due to ter-
ritorial disputes that involve tiny, but rich in oil, islands in the Sulawesi sea
and because of mistreatments of migrant Indonesian workers,149 increasing
145. As maintained by the Jakarta-based Global Future Institute, this could be

«a considerable strategic step to reopen the opportunities of strategic cooperation
between the two countries bilaterally, or even open up other possible cooperation in
a broader scope, such as in the scheme of BRICS (Brazil, Russia, India, China and
South Africa)» (Hendrajit, ‘Indonesia should play active roles’).
146. Brinda Banerjee, ‘Russia, Indonesia Cooperate, Seek Nuclear Ties’, Value-
walk, 18 November 2015 (http://www.valuewalk.com/2015/11/russia-indonesia-nucle-
ar-ties). The consolidation of the ties between the two countries has been described
by some analysts as «the return of the old good days». As a matter of fact, the relations
between Jakarta and Moscow were significantly strong until the rise of Suharto, who,
in line with his anti-communist ideology, leaned towards the US. See Rakesh Krishna
Simha, ‘Russia sails forth to ensure Indonesian maritime security’, Russia Beyond the
Headlines, 27 October 2015. Prashant Parawesmaran, ‘Indonesia to Buy New Subma-
rines from Russia’, The Diplomat, 25 September 2015. It remains to be seen if Indone-
sia will wedge its influence in favour of the choice of Russia as the venue for the 2016
Russia-ASEAN Jubilee Summit celebrating the 20th anniversary of dialogue partner-
ship, a choice that has been opposed by the Philippines and Singapore, traditional
US allies in the region (Ibid.). See also ‘Russia-Indonesia Partnership to Build Future
of Indonesian Nuclear Sector’, The Jakarta Globe, 7 October 2015.
147. Prashanth Parameswaran, ‘India, Indonesia to Cooperate on Maritime Se-
curity, Defence Procurement’, The Diplomat, 14 August 2015.
148. See also Prakash Nanda, ‘Masala Bumbu: Pushing India and Indone-
sia’, Ibnlive, 22 September 2015, on the latest book by Gurjit Singh (http://www.
ibnlive.com/blogs/india/prakash-nanda/masala-bumbu-pushing-india-and-indone-
sia-14452-1108457.html); ‘India becomes ASEAN’s partner in maritime cooperation:
Jokowi’, in The Global Review, 24 November 2015 (http://www.theglobal-review.com/
content_detail.php?lang=en&id=18377&type=3#.VpDibYRlnR2).
149. It is estimated that these number about 2.4 million, employed main-
ly as maids and in palm oil plantations. Mervin Piesse, ‘Malaysia-Indonesia Re-
lationships stronger after Presidential Visit’, Future Directions International, 11
February 2015 (http://www.futuredirections.org.au/publications/indian-ocean/29-in-
187
ElEna ValdamEri
bilateral trade, investment growth and deepening cooperation in defence

and security are contributing to a detente.150 Thus, in February, during a
bilateral meeting, the Defence Ministers of the two neighbour countries
signed a letter of intent expressing their will to cooperate in the fight
against both IS and piracy: this has been interpreted as a mutual effort
to temporarily overcome territorial disputes in order to fight common
enemies.151
All in all, Indonesia is trying to diversify its bilateral relationships in
an effort to balance the influence of the US and China in the Indo-Pacific
region and to strengthen its position. This notwithstanding, it cannot be
denied that Indonesia has not completely neglected its traditional role of
mediator within the south eastern region. It is worth mentioning that dur-
ing the Shangri-La Dialogue held in April 2015, Indonesia had proposed
a peaceful settlement of several border disputes by supporting regional
dialogue, the introduction of a Code of Conduct (CoC), and the intro-
duction of joint patrolling operations in the area.152 Moreover, despite
the tougher approach taken by the Indonesian military towards China,
also seen above, and the deployment of at least 14 naval ships to conduct
routine surveillance in the southernmost South China Sea area, Jokowi
and Coordinating Minister for Security and Political Affairs Luhut Bin-
sar Pandjaitan made blunt statements after the provocative action of the
American destroyer USS Lassen153 asking all sides to «exercise restraint»
and tone down the inflammation of the dispute.*154
dian-ocean-swa/2115-malaysia-indonesia-relationship-stronger-after-presiden-
tial-visit.html).
150. ‘Indonesia, Malaysia to foster closer ties’, The Global Review, 6 February
2015 (http://www.theglobalreview.com/content_detail.php?lang=en&id=17055&typ
e=1517055&type=15#.VpPjHoRlmt9). See above and Marshall Clark & Yasmi Adri-
ansyah, ‘Domestic controversy plagues Jokowi’, EastAsiaForum, 10 March 2015, for the
MoU for the production of an Indonesian national car and the controversy around it.
151. ‘Malaysia, Indonesia agree to share intelligence information in combating
IS threat’, The Sun Daily, 26 February 2015.
152. ‘Indonesia monitoring its territory bordering South China Sea’, Republika,
10 December 2015.
153. See footnote 131.
154. John Roberts, ‘Indonesian foreign policy tilts towards the US and its al-
lies’, World Socialist Web Site, 31 December 2015. In spite of the title, accurately
reflecting the author’s thesis, Roberts’s own analysis makes clear that the TNI and
other sections of Indonesian politics have non-identical approaches concerning the
connection with the US. As already pointed out, the clash between Ryamizard and
Jokowi over domestic policies is also evident in foreign policy. The fact that the
military wants to push the government to strengthen cooperation with the US is
not surprising, as, since the Suharto era, Washington has constantly supported the
Indonesian army.
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IndonesIa 2015
5. The economy
5.1. The general economic trend

In 2015, the Indonesian economy was under pressure from both inter-
nal and external factors. Although the new President’s election brought a
gust of optimism to a country which had been bitterly disappointed by the
slowdown of the economy in 2014,155 the problems inherited from the pre-
vious government – that is endemic corruption, rising inequality, sluggish
economic growth and poor infrastructure – were deep-seated and not easy
to solve. These unfavourable conditions were exacerbated by a new global
economic slump and by the huge cost of the haze crisis which amounted to
1.9% of the GDP in only five months.156
Initially, Joko Widodo had set expectations too high: he had projected
a growth rate of 7%, then revised to 5.7%, for 2015.157 The World Bank con-
sidered it ambitious and unrealistic, and, already in the second quarter of the
year, forecast the growth of Indonesia’s GDP at around 4.7%, a figure that
was confirmed by further forecasts at the end of the year.158 In fact, Southeast
Asia’s largest economy was affected by the financial crisis in China and in
other parts of the world: the rupiah fell precipitously against the US dollar
in the first nine months of 2015, trading at the lowest level since 1998, while
performing slightly better in the remaining part of the year.159 This had bur-
densome repercussions for the country: internal consumption, which com-
prises half of the economy, decreased since domestic purchase power was cur-
tailed by the high inflation and the high benchmark interest rate at 7.50%.160
Moreover, the rupiah’s depreciation did not even benefit Indonesia’s main
155. In 2014 the GDP growth rate was 5%, decidedly lower than in the previous
years: it was 6.5% in 2011, 6.3% in 2012, and 5.8% in 2013. The World Bank, East Asia
and Pacific, Global Economic Prospects, January 2015.
156. See the presentation of the December Indonesia Economic Quarterly at The
World Bank, Indonesia Economic Quarterly, Reforming amid uncertainty, Presentation, De-
cember 2015. Moreover, the outermost areas stricken by the fires and haze crisis, name-
ly East Kalimantan and Papua, have seen their growth materially reduced with massive
losses in terms of environment and social costs. For the estimated losses see The World
Bank, Indonesia Economic Quarterly, Reforming amid uncertainty, December 2015, p. 23.
157. Jokowi’s over optimism influenced also the target of 30% increase (initially
set at 60%) of tax collection, which comprises 70% of state revenue. In November a
disappointing 60% only of the amount prefixed was reached. Significantly enough,
the increase in tax collection for 2016 is projected at 4%, a demonstration of the gross
miscalculation made. Rendi A. Witular, ‘President Jokowi’s tax collection fiasco: The
Jakarta Post’, The Strait Times, 4 December 2015.
158. ‘Indonesia Economic Quarterly’, December 2015, p. iii.
159. See ‘Indonesian rupiah slides in September to levels not seen since 1998’,
Focus Economics, 16 September 2015.
160. John Roberts, ‘Indonesian President Widodo under pressure as economy
slides’, World Socialist Web Site, 29 July 2015.
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ElEna ValdamEri
exports, namely natural gas, coal, and palm oil, due to a downward trend in
their prices.161 Also manufacturing exports were not favoured by the weak
currency, as several industries need to import basic or intermediate materials
in order to produce exportable commodities. Another reason for the loss of
competitiveness was the surge of labour wages, spurred by inflation.162
Consumers’ confidence fell also as a consequence of President Wido-
do’s decision to stop gasoline subsidies and cap assistance for diesel from
January.163 The removal of fuel subsidies, which had been in place since the
first petrol crisis in 1973, was favoured by falling global oil prices. Accord-
ing to forecasts, the budget cost of fuel subsidies was reduced from US$ 8
billion in 2015 to US$ 4 billion in 2016.164 This move was part of Jokowi’s
broad aims to make funds available in order to boost spending on educa-
tion, health, infrastructure and abate the budget deficit from under 3% to
under 2% of the GDP. However, the beneficial effects of the state budget
savings, if any, were to be seen in the following years. For the time being,
the measure was not popular, because of fear that the cost of transportation
and food could increase, even though the government took steps to moder-
ate the negative impact of higher prices on vulnerable households. These
steps included a monthly allowance for 15.5 million economically unprivi-
leged families, plus health assistance and funds for education. The relative
expenses would be financed by making use of the financial resources made
available in the medium-term by the removal of fuel subsidies.165
5.2. Public spending in support of the disadvantaged social strata

It should not be forgotten, in fact, that according to the World Bank
more than 11% of Indonesians live below the national poverty line (for 2015
this was fixed at 331.000 rupiahs per month, about US$ 23),166 while many
more are just slightly above it. On the whole, people below and slightly abo-
ve the poverty line form a conspicuous disadvantaged stratum.167
The President launched a health care programme and a public edu-
cation programme, which were modelled on programmes which he suc-
161. ‘Indonesia Economic Quarterly’, Appendix figure 9, p. 37.

162. ‘Even with rupiah’s fall, Indonesian manufacturers struggle to export’,
Reuters, 10 April 2015.
163. Diesel subsidies have been kept, although lower than before, because die-
sel is mainly used by public transportation and fishermen.
164. Asian Development Bank, Fossil fuel subsidies in Indonesia: trends, impacts,
and reforms, Mandaluyong City, Philippines, Asian Development Bank, 2015, p. 28.
165. Creina Day & Yose R. Damuri, ‘Economic reform in Jokowi’s Indonesia’,
EastAsia Forum, 20 May 2015.
166. ‘Indonesia Economic Quarterly’, December 2015, p. 42.
167. According to the World Bank the percentage of people cluttered around
the poverty line is about 40%. See the country overview at http://www.worldbank.org/
en/country/indonesia.
190
IndonesIa 2015
cessfully implemented during his mayoral career in Solo. It will be seen

whether the conditions to implement such schemes at the national level
will be created. A major problem, in fact, is the lack of coordination be-
tween centre and periphery. Until October 2015, the level of fiscal deficit
was still 2.5% of GDP, instead of the proposed target of 1.9%; the gov-
ernment’s commitment to accelerate public spending and a revenue col-
lection lower than expected contributed to that result.168 As planned, the
expenditure for infrastructure, health and social assistance has increased
and should further increase as per the 2015-2016 budget. As far as infra-
structure is concerned, the allocation of more funds will go to local govern-
ments and through capital injections to SOE.169 A higher public spending
in infrastructure is positive because it can help reduce the negative effect
of higher unemployment caused by moderate growth.170 In 2015, in fact,
both construction and trade benefitted from the expansion and/or better-
ment of infrastructure, which created the largest number of jobs.171 On the
other hand, universal access to subsidised healthcare was supposed to be
achieved by 2019 and will require increasing spending to cover more and
more of the population.172
Jokowi’s social programmes, in line with social security schemes intro-
duced in 2013 by Yudhoyono, address both the formal and informal sec-
tors, even though it is much more difficult to implement such schemes in
the informal sector. A positive development was that, from August 2010 to
February 2015, the number of workers employed in the informal economy
went down from 59% to less than 52%. Moreover, most of the new jobs cre-
ated from 2001 are in the formal economy.173 Poverty reduction, however,
has been less successful, recording no decline in 2014, while the divide be-
tween poor and rich has been widening: according to a World Bank report
published in November 2015 the income of the top 10% of the population
rose three times faster than that of the lowest 40%.174
Certainly, it takes time to fix inequality, but providing targeted social
168. ‘Indonesia Economic Quarterly’, December 2015, p. 13.

169. Ibid, p. 12.
170. The aggregate unemployment increased from 5.9 in August 2014 to 6.2%,
moving upward for the first time in the last decade. Ibid., p. 14.
171. Ibid. On the contrary, the manufacturing sector is weak and has been made
under heavy pressure from China’s entry in the global market, with alarming de-
creases in sales for labour-intensive products like textiles and footwear. ‘Indonesian
President Widodo under pressure as economy slides’.
172. The World Bank, ‘Indonesia Economic Quarterly. Reforming amid Uncer-
tainty’, December 2015, p.12.
173. International Labour Organisation, ‘Labour and social trends in Indonesia
2014-2015: Strengthening competitiveness and productivity through decent work’,
International Labour Office – Jakarta: ILO, 2015, pp. 54-6.
174. The World Bank, ‘Indonesia’s Rising Divide’, The World Bank Office - Ja-
karta, November 2015, pp. 7-8.
191
ElEna ValdamEri
assistance and a good tax administration can contribute to realise Joko

Widodo’s aim to cut the country’s Gini coefficient,175 stable at 0.41 since
2011, to 0.39% by 2019.176
5.3. The 2015-2016 budget

The 2015-2016 state budget was approved in October 2015. The mac-
roeconomic targets remained those of enhancing investment in infrastruc-
ture development (raised by 8% compared to the 2014-2015 state budget),
increasing, exports and boosting people’s purchasing power through sub-
sidies to diesel, electricity, and gas, along with programmes of food securi-
ty.177 Economic growth was projected at 5.3%, lower than the government’s
initial assumption, with an inflation rate of 4.7% and an exchange rate of
13,900 rupiahs per US$. In relation to welfare, targets include the reduction
of the poverty level between 9 and 10% as well as the decrease of unemploy-
ment rate to 5.2% from 5.5%.178
The only party which disagreed with the budget draft was Gerindra.
In particular, Gerindra, the major opposition party in the «Red-and-White»
coalition,179 carried out such a determined opposition against the injection
of state capital in SOE that the government had to postpone that measure
sine die.180 The plan was to inject around US$ 3 billion in state firms, in
particular construction and electricity companies, to boost infrastructure
development. This would have been a significant economic step in relation
to the size of Indonesia’s economy. State enterprises, with an asset superior
to US$ 300 billion, are pivotal for building infrastructure and connect the
archipelago through communication and a more even development; more-
over, they employ more than 850,000 people.181 It is understandable, then,
175. In the Gini coefficient, developed by the Italian statistician and sociolo-
gist Corrado Gini in 1912, zero expresses perfect equality, whereas one expresses
maximal inequality.
176. Sujadi Siswo, ‘Inequality in Indonesia at record levels: World Bank’, Chan-
nel NewsAsia, 8 December 2015.
177. In relation to food security it can be interesting to see Joko Widodo’s ag-
ricultural manifesto released at the beginning of the presidential race: ‘Joko Widodo
Lays Out Agricultural Manifesto for Indonesia’, The Jakarta Globe, 27 April 2014.
178. ‘Here are state budget draft 2016’, Republika, 31 October 2015.
179. As seen above, the Red-and-White Coalition, which opposes Jokowi, had
the majority in the Indonesian Parliament until one of its parties, namely the moder-
ate Islamist PAN, joined the ruling coalition in October. See Marco Vallino, ‘Indone-
sia 2014’, p. 137 and footnote 33 above.
180. ‘Gerindra Party opposes 2016 State Budget Bill’, The Jakarta Post, 31 Octo-
ber 2015; ‘Postponed PMN Blocks Jokowi’s Programs’, GresNews, 11 November 2015;
Desy Setyowati, ‘In Relation to State Budget 2016, Parliament still question SOE’s
Capital Injection’, Katadata, 1 November 2015.
181. See the list of the companies planned to receive PMN: ‘2016 State Budget
Draft Indonesia: Capital Injections State Companies’, Indonesia Investments, 19 Au-
192
IndonesIa 2015
that Jokowi and the Minister of SoE, Rini Soemarno, considered this step to
be very important for growth. Even though Rini Soermano was not exclud-
ing privatisation as a future option, her priority was, for the time being, the
expansion of state enterprises.182
Apart from finding a way to implement such expansionary policy, it
remains to be seen how Jokowi’s administration is going to face the prob-
lems that hinder infrastructure development: one is corruption, which has
involved several state enterprises in recent times; the other is difficulty in
spending, as shown by the fact that, in the first six months of the year un-
der review, only 11% of the US$ 22 billion allocated for infrastructure pro-
grammes were spent.183
Another much-discussed measure was tax amnesty, which was sup-
posed to be implemented in 2015 but had to be included in the 2015-2016
budget.184 Through this, the President aimed to decrease the budget defi-
cit. Nevertheless, the proposal caused concern among anti-corruption ac-
tivists and the Organisation for Economic Cooperation and Development
(OECD): as a matter of fact, according to them, Indonesia does not have
enough monitoring mechanisms to make sure that people who do not
comply with amnesty or just partially submit their assets get punished.185
Moreover, analysts fear that it is too risky to rely on such uncertain resources
and that future tax compliance might be negatively affected by amnesties,
favouring the promotion of tax evasion and a culture of impunity.186
5.4. Moving towards neoliberalism?

The economic policy adopted by Joko Widodo appeared predicated
on a good dose of state intervention, evidently seen by the new President
as conducive to steady growth and inclusive development. Nevertheless,
the appointment of Thomas Lembong as Trade Minister following the Au-
gust Cabinet reshuffle and a package of deregulation policies, according
gust 2015. The government announced also that given the economic slowdown the
payment of dividends from SoE could be curtailed by 16% in 2016.
182. Ben Otto & Patrick MacDowell, ‘Indonesia Pushes Overhaul of State Firms
as Key to Growth’, The Wall Street Journal, 20 April 2015.
183. ‘Joko Widodo Presents Indonesia’s 2016 State Budget Draft in Parliament’,
Indonesia Investment, 15 August 2015.
184. See the terms for the planned tax amnesty in ‘Indonesia Chasing Overseas
Money’, Global Indonesian Voices, 10 July 2015.
185. Chrsi Brummit, ‘Jokowi’s Push for 2016 Tax Amnesty Plan Kick-Off Seen
as Flawed’, Bloomberg, 3 January 2016.
186. Glenn Polii, ‘The Facts, Fiction of Tax Amnesty’, The Jakarta Post, 12 No-
vember 2015. According to the author of the article, taxpayers perceive tax amnesty
as a capitulation of a state that does not have the power to detect tax evasion and
to enact the law. Therefore, the trust of taxpayers in the tax administrative system
decreases along with tax compliance.
193
ElEna ValdamEri
to which the minimum wage is also determined,187 have raised concerns

about the new President possibly sliding towards a neoliberal agenda. Also
the decision to let fuel prices be fixed by market mechanisms has been
interpreted as evidence of a growing neoliberal influence.188 As a more
telling signal that the biggest economy of ASEAN might move in the di-
rection of the hegemonic paradigm of neoliberalism, Jokowi and Trade
Minister Thomas Lembong declared their intention to join the TPP.189 Sev-
eral economists have warned about the dangers that joining the TPP could
cause to the country. In fact, while Jokowi apparently wants to be involved
in the free trade agreement in order to attract foreign direct investment
more easily,190 the benefits for the common person are questionable. For-
mer President Yudhoyono himself advised Joko Widodo against signing
the TPP and cautioned him about the geopolitical repercussions that such
a decision could cause, especially as far as China is concerned.191 Lana Soe-
listianingsih, an economist at the University of Indonesia held that signa-
tory neighbouring countries like Singapore, Malaysia and Vietnam, being
manufacturing export-based economies, will be able to perform better in
the US-promoted partnership than Indonesia, whose exports are mainly
raw materials like oil and gas. According to Soelistianingsih, boosting the
competitiveness of the Indonesian manufacturing sector would require,
among other things, significant upgrades to the existing poor electricity
infrastructure.192 Likewise Firmanzah, a former dean of the faculty of Eco-
nomics of the University of Indonesia, has argued that Indonesia should
focus on existing regional agreements such as the Regional Cooperation
Economic Partnership (RCEP) and the Comprehensive Economic Partner-
ship Agreement (CEPA). Different from these regional agreements, the
TPP is at odds with Jokowi’s development agenda «Nawa Cita», whose pur-
pose is to achieve economic independence by developing strategic sectors
in the domestic economy.193
187. See above footnote 35.

188. ‘Neoliberal proponents to foil Jokowi’s people’s economy agenda: Expert’,
The Jakarta Post, 1 February 2015.
189. ‘RI could join Trans Pacific Partnership within two years’, The Jakarta
Post, 11 October 2015; ‘Indonesia will join Trans-Pacific Partnership, Jokowi tells
Obama’.
190. The Indonesian government has acknowledged that it can directly fund
only 30% of its infrastructure programme for the next five years and that it relies
on SOE and private investors for the remaining 70%. See ‘Indonesia Needs Private
Funding for 70% of Infrastructure’, Bloomberg, 23 January 2015.
191. ‘Yudhoyono to Joko: Don’t Force Indonesia to Enter TPP’, The Jakarta
Globe, 31 October 2015.
192. ‘Indonesia in No State to Join Trans-Pacific Partnership, Stakeholders
Caution’, The Jakarta Globe, 28 October 2015.
193. RCEP is a trade partnership between ASEAN and Australia, China, India,
Japan, South Korea and New Zealand, while CEPA is an agreement with South Korea,
194
IndonesIa 2015
Generally, many observers have been afraid that the positive results
attainable through social schemes and economic policies could be neu-
tralised by joining the TPP. Among other problems, they pointed out the
risk of the massive damages that the penetration of food multinational
companies into the food sector could cause to small farmers. Likewise,
they highlighted the danger that some TPP regulations could cause the
removal of the extant provisions of flexibility related to the implementa-
tion of the Agreement on Trade Related Aspects of Intellectual Property
Rights (TRIPS). This is a scheme which allows many developing countries
to produce generics of drugs patented by US pharmaceutical companies
at lower prices in the public’s interest. Such removal could result in a sig-
nificant increase in prices due to cartels and monopolies on drugs organ-
ised by powerful foreign corporations.194 It is a remarkable fact that even
a financial institution like the World Bank, which has consistently shown
its commitment to the promotion of neoliberal policies, has expressed its
reservation over the potential effects of «the [TPP] agreement [since it]
affords countries little flexibility to make laws and regulations more restric-
tive towards other member countries […]». Accordingly, as acknowledged
by the World Bank, «the cost of this TPP-imposed limitation would be the
loss of some economic policy space».195
aimed at increasing two-way trade to US$ 100 billion annually by 2020 (See ‘TPP will
threaten Indonesia’s SOE: Expert’, The Jakarta Post, 7 November 2015).
194. Hendrajit, ’President Jokowi should realize the danger of TPP’.
195. The World Bank, ‘Indonesia’s Rising Divide’, The World Bank Office - Ja-
karta, November 2015, p. 35.
195
singapore 2011-2015: a tale oF two elections
Stephan Ortmann
City University of Hong Kong

sortmann@cityu.edu.hk
The electoral authoritarian regime of Singapore has experienced two very different
general elections in 2011 and 2015. The first was a watershed election that allowed
the opposition to capture the largest number of seats ever, including a group represen-
tative constituency, which was once believed to be impossible. It had also fielded the
most candidates ever, running in all but one constituencies. The latter, however, was
a major setback for the opposition which had to suffer a significant reduction in the
share of popular vote. As the ruling party won in a landslide, the opposition Workers’
Party even lost one seat that it had gained in a by-election in 2013. Opposition sup-
porters, who had hoped to make additional gains, were devastated. Observers even
saw in the election result a clear victory for the soft-authoritarian regime. This paper,
however, argues that Singapore, in spite of the 2015 election, continues to be on the
path to a fundamental political transformation. The majority of Singaporeans still
wants a responsive government with sufficient checks on arbitrary power. The ruling
party now has to be much more responsive to popular desires and quirks than in the
past and can no longer act according to what it claims to be the long-term interests
of the country. In addition, it is important to recognize that the 2015 election was
conducted under extremely favorable conditions for the ruling party including Sin-
gapore’s 50 year celebrations and the death of the «founding father» Lee Kuan Yew.
Overall, this demonstrates that the ruling party’s hegemonic position is in decline
while it remains to be seen how the ruling party will fare in the upcoming leadership
transition amid growing challenges and the lack of a clear successor.
1. Introduction
In 2011 and 2015, Singapore experienced two general elections which

can be seen as polar opposites of each other. The 2011 election signified po-
litical change as the opposition could make its largest gains in post-indepen-
dence history. For the first time, the election had truly been competitive even
though the chances of an opposition victory had remained slim. The fact that
the opposition Workers’ Party was able to capture six seats, including a group
representative constituency, was seen as a watershed event in the political de-
velopment of Singapore.1 This has raised hope that Singapore could be on
1. e.g. Catherine Lim, A Watershed Election: Singapore’s GE 2011, Singapore:

Marshall Cavendish, 2011; Netina Tan, ‘Manipulating electoral laws in Singapore’,
Electoral Studies, 32, 4, 12/2013, pp. 632-643.

Stephan Ortmann
the verge of democratization because competitive authoritarian regimes have

shown to be more likely to democratize than other more closed authoritarian
regimes.2 In contrast, the 2015 election saw a massive swing in favour of the
ruling People’s Action Party (PAP), which was described as a landslide victory.3
Although the Workers’ Party managed to retain all but one of its seats (it lost
one it had gained during a by-election), the election was regarded as a major
setback for the opposition and came as a great shock to many supporters.
The strong support for the PAP seemed to indicate resurgent support for the
authoritarian government among the Singaporean public.4
This paper, however, argues that despite the electoral setback, Singa-
pore’s political system continues to be on the path of fundamental political
transformation. Although the process of political change is slow, the ruling
party has significantly altered its principal modus operandi. In order to gain
support, the PAP has shifted toward less technocratic and more populist
politics to counter its declining support and rising demands for pluralism.
Moreover, Singaporeans still want more pluralism and an effective opposi-
tion in parliament. Finally, the large vote swing in the 2015 election can also
be seen as a result of the strategic timing of the election by the ruling party.
In fact 2015 was both the 50th anniversary of the country’s independence
and the year of the passing away of Lee Kuan Yew, Singapore’s first prime
minister, often referred to as the «founding father» and credited with the
country’s rapid economic development.
The remainder of this article is focused on the study of Singapore’s po-
litical evolution as highlighted by the 2011 and 2015 elections. But, as a fur-
ther preface to it, it is important to stress that the Singapore’s political evo-
lution between 2011 and 2015 occurred against an economic background
which was characterized both by sustained growth and increasing social di-
sparities. Indeed, by 2015 Singapore had become one of the most advanced
economies in the world with a GDP per capita that, according to the World
Bank, is higher than the United States of America.5 Even in recent years, the
city-state has still been able to record modest growth with 6.2% in 2011 and
2. Philip G. Roessler & Marc M. Howard, ‘Post-Cold War Political Regimes:

When Do Elections Matter?’, in S. I. Lindberg (ed.), Democratization by Elections: A New
Mode of Transition, Baltimore: The Johns Hopkins University Press, 2009, pp. 101-
127; Jason Brownlee, ‘Portents of Pluralism: How Hybrid Regimes Affect Democratic
Transitions’, American Journal of Political Science, 53, 3, 2009, pp. 515-532; Daniela
Donno, ‘Elections and Democratization in Authoritarian Regimes’, American Journal
of Political Science, 57, 3, 2013, pp. 703-716.
3. Kirsten Han, ‘Landslide victory for ruling party in Singapore general elec-
tion’, dpa international, 13 September 2015.
4. Kenneth Jeyaretnam of the Reform Party called it «a mandate for authoritari-
anism», cited in Mark Wembridge, ‘Singaporeans vote overwhelmingly to return PAP
to power’, The Financial Times, 11 September 2015.
5. World Bank, ‘GDP per capita (current US$) (http://data.worldbank.org/indi-
cator/NY.GDP.PCAP.CD).
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Singapore 2011-2015
2.9% in 2014.6 While the unemployment rate has remained low at around
2%, Singapore continues to have a very high degree of inequality with a Gini
coefficient of 0.412 after taxes and transfers, which is much worse than most
developed countries although, according to government data, it has decli-
ned slightly in recent years.7 Moreover, the city-state has also become one of
the most expensive places in the world lo live in.8 As shown below, this has
led to changes in politics. However, the democratic development has been
lacking as the country continued to be ruled by an elitist party in the form of
an electoral authoritarian regime and the political opposition has remained
deeply divided. While there has been a slow liberalization process since the
1990s, the government has maintained strict limits on the development of
civil society, the ability to protest, and the use of free speech.
2. Singapore’s electoral authoritarian regime
Even though the Southeast Asian city-state holds regular elections with univer-
sal suffrage, it is difficult to characterize it as a democracy. Elections are not unique to
democracies as they nowadays exist in most countries around the world, even in those
which would be classified as closed authoritarian such as North Korea. However,
there are undemocratic regimes in which elections are more than a façade.
Unlike in Communist regimes, different independent political parties are
allowed to contest although they face severe obstacles to gain power, such
as strict limits on the ability to operate and campaign effectively. They face
restrictions on the freedom of speech and assembly, while even vote buying
is widely employed against them. This hybrid regime form between closed au-
thoritarianism and liberal democracy has been called «electoral authoritar-
ian regime».9
This is the case in Singapore, where the electoral system is excessively
biased in favour of the incumbent ruling party, which can significantly in-
fluence the outcome. Not only, is there plurality voting10 and gerry-man-
dering, altering the constituency lines in such a way to favour of the party
6. Singapore Department of Statistics, ‘Latest Key Indicators’, 2015 (http://

www.singstat.gov.sg).
7. Mark Wembridge, ‘Singapore ruling party takes flak over wealth gap’, Finan-
cial Times, 10 September 2015.
8. Ann Williams, ‘Singapore still world’s most expensive city, says EIU’, The
Straits Times, 3 March 2015.
9. Andreas Schedler (ed.), Electoral Authoritarianism: The Dynamics of Unfree Com-
petition, Boulder: Lynne Rienner, 2006.
10. The «Plurality voting» system, more commonly known as «First-past-the-
post» system, is the single turn system where the winning candidate is the one who
conquers the majority of the constituency votes, even if it is only the relative majority.
Accordingly, in a constituency in which the popular vote is split among several politi-
cal parties, as a rule the winner is expression of a minority of the popular vote.
199
Stephan Ortmann
in power, but since 1988, there has been the introduction of group repre-
sentation constituencies (GRCs). This means that, particularly in the larger
constituencies, the competition is not among single candidates, but among
groups of candidates, four to six, with at least one member belonging to a
minority ethnic group. This change was introduced in a period, the 1980s,
when the opposition was gaining seats, and represents a significant barrier
for the development of a stronger opposition, which needs to find more
highly qualified candidates.11 Even more problematic is the lack of a divi-
sion between local and central government, which not only deprives op-
position members from gaining experience on the ground but also means
that electoral outcomes can be directly linked to local services including
whether residential areas will be renovated. The ruling party even admitted
that linking the upgrading of public housing to votes helped it gain support
in the 1997 general election.12 Even today, the management of estates is of
great concern during election periods as the ruling party seeks to tie its vote
to local issues rather than national concerns. While the vote is held secretly,
there are serial numbers on ballots, purportedly to avoid voter fraud, which
have raised some concerns among opposition parties and potentially cre-
ates fear among voters that their votes could be traced.13 Political activities
are also marked by a climate of fear that runs deep even among opposi-
tion party members who still worry about the existence of «moles».14 The
prevalence of surveillance cameras in Singapore and the ability to quickly
apprehend politically motivated vandals has strengthened this perception
further.15 Finally, restrictions on the campaign itself also make it difficult for
opposition parties to effectively compete. The official campaign period has
a minimum of only nine days (which is currently the standard) including
the so-called «cooling-off» day on the last day, a feature which was introduced
for the 2011 election.16 Party propaganda and election commercials are not
allowed to be made and distributed online.17 As the mainstream media are
biased in favour of the ruling party, opposition parties struggle to get their
voice heard.
11. Netina Tan, ‘Manipulating electoral laws in Singapore’.

12. ‘PAP admits upgrading link swung vote in GE’, The Straits Times, 12 Janu-
ary 1998.
13. Yeo Lay Hwee, ‘Electoral Politics in Singapore’, in Aurel Croissant (ed.),
Electoral Politics in Southeast & East Asia, Singapore: Friedrich-Ebert-Stiftung, 2002,
pp. 203-232 (http://library.fes.de/pdf-files/iez/01361007.pdf).
14. Interviews with a political activist, August 2015.
15. The police charged five 17-year-olds who had sprayed anti-PAP graffiti on
the rooftop of a public housing estate just three days after the incident had occurred
on 7 May 2014.
16. Sharon Chen, ‘Quirks of Singapore’s Elections’, BloombergBusiness, 9 Sep-
tember 2015.
17. Chong Zi Liang, ‘Do not produce political films, MDA reminds parties’, The
Straits Times, 18 August 2015.
200
Singapore 2011-2015
The ruling party has also constantly adapted the parliamentary system
to weaken any potential challenge from the opposition. Currently, there
are 92 members of parliament, 89 of them are elected while the remaining
three are Non-Constituency Members of Parliament (NCMP). In 1984, fol-
lowing opposition successes, the government decided to create a provision
that allows it to appoint up to nine losing opposition party members. This
move responded to the growing demands for alternative voices in parlia-
ment while, at the same time, by ensuring that the opposition would be rep-
resented anyway, sought to discourage people from voting for it. In other
words, the ruling party tried to reserve for itself the selection of a fair share
of the opposition representatives.
Currently, there are two NCMPs in office. Aside from the undemo-
cratic aspect of nomination, NCMPs also do not have the same rights as
other members of parliament. For instance, they cannot vote on motions
of no confidence or constitutional changes. In addition, since 1990 the
government has also regularly appointed Nominated Members of Parlia-
ment (NMP) from various social groups for two and a half year terms, which
have similar rights as NCMPs. They are supposed to introduce independent
voices into parliamentary debates. Finally, in 1991 the President became
directly elected. This was not done to enhance the democratic nature of the
regime. In fact, running for office came with very stringent requirements
including membership in the top élite.18 Although the President’s role has
remained largely ceremonial, according to Lee Kuan Yew the President’s
power to block withdrawals from the national reserves is supposed to avoid
the possibility that a future opposition government could potentially misuse
the funds.19
The Singapore government has been able to effectively dominate the
national discourse in all public arenas except the Internet. This begins as
early as in kindergarten, many of which are operated by the ruling party.
18. According to Article 19G of the constitution, a presidential candidate

should «for a period of not less than 3 years held office:
(i) as Minister, Chief Justice, Speaker, Attorney-General, Chairman of the Public
Service Commission, Auditor-General, Accountant-General or Permanent Secretary;
(ii) as chairman or chief executive officer of a statutory board to which Article
22A applies;
(iii) as chairman of the board of directors or chief executive officer of a company
incorporated or registered under the Companies Act (Cap. 50) with a paid-up capital
of at least $100 million or its equivalent in foreign currency; or
(iv) in any other similar or comparable position of seniority and responsibility
in any other organisation or department of equivalent size or complexity in the pub-
lic or private sector which, in the opinion of the Presidential Elections Committee,
has given him such experience and ability in administering and managing financial
affairs as to enable him to carry out effectively the functions and duties of the office
of President.»
19. Hussin Mutalib, ‘Constitutional-Electoral Reforms and Politics in Singa-
pore’, Legislative Studies Quarterly, 27, 4, 2002, pp. 659-672.
201
Stephan Ortmann
The school curriculum stresses and at times even exaggerates the achieve-
ments of Lee Kuan Yew, one of the founders of the PAP and the first prime
minister of independent Singapore. Although Singapore was one of the
most developed Asian cities in 1959, Lee Kuan Yew has sought to create
the impression that he and his party have achieved a miracle as Singapore
supposedly transformed from third world to first.20 High economic growth
rates, investments in public housing and other achievements have signifi-
cantly transformed the tiny island nation.
The Singapore government also holds sway of all traditional media,
which are owned by government-linked corporations and are thus pro-gov-
ernment. Critics and overseas media have been silenced with lawsuits alleg-
ing slander or sedition. Most recently, a defamation lawsuit on behalf of the
prime minister was brought against Roy Ngerng for online criticism of the
Central Providence Fund, which he had compared with an illegal misappro-
priation scheme of a local church.21 It is thus not surprising that Singapore
ranks 153rd in the Press Freedom Index published by Reporters Without
Borders in 2015. This is worse than Myanmar, Russia, and Zimbabwe and
only slightly better than Libya, Iraq and Egypt.22 In recent years online
media have challenged the government’s control over the public discourse.
This has been met with a strong reaction by the government. In order to
also contain the challenge from online media, new registration rules have
been introduced, making it more difficult for these sites to operate.23
Finally, it is important to recognize the relevance of Singapore’s stra-
tegically important geographical position as a crucial factor for the long-
term survival of its electoral authoritarian regime. Indeed the support from
Western powers, despite frequent criticism about Singapore’s human rights
record, has never been lacking.24 This support has its roots in the Cold
War in which the PAP was staunchly anti-Communist and thus provided the
US with its most important ally in Southeast Asia.25 This has not changed
with the rise of China as Singapore has become the most important strate-
gic base for the American «Pivot to Asia». In early 2015, it was announced
20. Lee Kuan Yew, From Third World to First: The Singapore Story: 1965-2000, New
York: HarperCollins, 2000.
21. Tham Yuen-C, ‘PM Lee’s lawyers seek «very high» damages in defamation
case against Roy Ngerng’, The Straits Times, 1 July 2015.
22. Reporters Without Borders, 2015 World Press Freedom Index, 2015. (https://
index.rsf.org/#!).
23. Dickson Su & Natalie Pang, ‘Beyond the Facebook post: A critical analysis
of the online public sphere in Singapore’, International Communication Association
Pre-Conference: New Media and Citizenship in Asia, 17-21 June 2014, London.
24. State Department, Singapore 2014 human rights report, Washington: Govern-
ment printer, 2015.
25. Ralf Emmers, ‘Security and power balancing: Singapore’s response to the
US rebalance to Asia’, William T. Tow & Douglas Stuart (eds.), The New US strategy
towards Asia, Abingdon and New York: Routledge, 2015, pp. 143-154.
202
Singapore 2011-2015
that the city-state would increase the number of US combat ships based in
Singapore to four by 2018.26 However, while Singapore needs the US to
maintain the balance of power in the region and to guarantee freedom of
navigation, it also seeks to build good economic relations with China and
thus maintains its official neutrality. For this reason, the government fre-
quently engages in high level diplomacy and «punches above its weight.»27
For example, in 2015 Singaporean officials arranged a high level meeting
between the Chinese and Taiwanese presidents in the hope of improving
relations between the two rivals.28
While the ruling party remained firmly in control, it needed to find
new mechanisms to incorporate rising demands from the public. On the
one hand, the government has sought to strengthen its links to the popu-
lation. Through the People’s Association and its associated grassroots or-
ganizations, the ruling party sought to penetrate all aspects of life. How-
ever, the lack of freedom for activists often led to a lack of enthusiasm in
these organizations, which was reflected in the repeated calls for a more
active citizenry. In the 1990s, the government sought to give Singaporeans
more space through the promotion of a «civic society», a depoliticized third
sphere that would allow activists to promote issues such as women’s rights,
human rights, or the protection of the environment without challenging the
power of the regime. This sphere was clearly marked as separate from po-
litical society, which would be the sole domain of political parties. External
influences within this sector would not be allowed. While this constituted
only a very careful initial step, it has to be seen as the basis for the increas-
ingly assertive civil society today.29
The idea of allowing a controlled liberalization in which the ruling
party would stay in firm control but people would be allowed to voice their
concerns was also behind the creation of a Speakers’ Corner in Hong Lim
Park in 2000. The cosy little park, away from the main business and govern-
ment areas, would give people the right to speak out on many issues, even
if some restrictions remained, such as a ban on discussing race, languages
and religion and the participation of foreigners.30 Over the years, a number
of restrictions were relaxed; accordingly in 2004 performances were allowed
and in 2008 demonstrations were permitted without the need for a police
26. Franz-Stefan Gady, ‘4 US littoral combat ships to operate out of Singapore

by 2018’, The Diplomat, 19 February 2015.
27. Robyn Klingler-Vidra, ‘The pragmatic «little red dot»: Singapore’s US
hedge against China’, IDEAS reports - special reports, London School of Economics and
Political Science, London, 2012.
28. Jake Maxwell Watts, ‘China-Taiwan Summit a Success for Singapore’, The
Wall Street Journal, 7 November 2015.
29. Stephan Ortmann, ‘Political change and civil society coalitions in Singa-
pore’ Government and Opposition, 5, 1, 2015, pp. 119-139.
30. Toh Yong Chuan, ‘Rise and rise of Speakers’ Corner’, The Straits Times, 26
July 2014.
203
Stephan Ortmann
permit. While Singaporeans showed little interest in the park in its first
years, this changed significantly following the relaxation of the rules and
the increasing ability on the part of the public to use the internet to mobilize
supporters and post videos about protests online. Nowadays, protests are
being organized much more frequently than in the past with a few thousand
people having joined the most popular ones. The most popular event has
been the annual gay rights event Pink Dot, which in 2015 attracted 28,000
people.31 Protests dealing with other issues such as the massive population
increase and the lack of transparency in the case of the Central Provident
Fund have attracted thousands of people.32 The government responded to
this issue-oriented protest by making some concessions such as promising
to reduce the number of immigrants. The largest political gatherings are
opposition election rallies which also attract thousands of people.
The need for control has been much greater in regard to the working
class, which remains highly depoliticized. The labour movement, unified
under the National Trades Union Congress (NTUC), is firmly in the hands
of the government as its secretary-general, currently Chan Chun Sing, is a
member of ruling party. In addition, the government owns a significant part
of the economy in the form of numerous large-scale government-linked cor-
porations (GLCs). As a consequence of the economic development model,
the level of income inequality has become one of the worst among developed
economies. There is no doubt that many people live in poverty, although it
is difficult to quantify their number, as the government has refused to set an
official poverty line.33
3. The 2011 general election: The rise of competitive politics
Despite Singapore’s extremely biased electoral process and strong lim-

itations on freedom of speech, there has recently been a shift toward a more
competitive political system, which, for the first time since independence,
has given the opposition, at least in theory, the possibility of winning an
election. This has occurred after years of limited progress by the opposition.
In 1981, J.B. Jeyeratnam had broken the electoral monopoly of the PAP in
a by-election. Since then, at least two opposition members were elected to
parliament in every general election. However, the opposition never fully
challenged the ruling party as it contested less than half of the seats. This
naturally meant that the ruling party had already won the election on nomi-
nation day. This changed in 2006, when for the first time the opposition
31. Lim Yan Liang, ‘Record 28,000 gather at Hong Lim Park for annual Pink
Dot rally’, The Straits Times, 13 June 2015.
32. Candice Cai, ‘4,000 protest against White Paper’, asiaone, 17 February 2013.
33. Chun Han Wong, ‘In Singapore, Calls for Poverty Line Amid Rising In-
equality’, The Wall Street Journal, 11 November 2013.
204
Singapore 2011-2015
contested more than half of the seats. Then the ruling party’s vote share
declined by more than 8% to 66.6%; at the same time the Workers’ Party man-
aged to gain over 13% of the popular vote, even though it did not increase
the number of its seats in parliament. Opposition parties at the time only
had two elected members.
A more significant shift occurred with the 2011 general election, when
all but one of the constituencies were contested by the opposition, thus mak-
ing an opposition victory possible, at least in theory. The opposition par-
ties strengthened their position by avoiding, in many cases, multi-cornered
fights, bound to result in the fragmentation of the opposition vote. Moreo-
ver, the quality of their candidates had increased significantly, many of them
being were established professionals, entrepreneurs, and even former civil
servants. Moreover, most of the candidates were highly educated, with a few
of them holding PhD degrees. For instance, the Singapore Democratic Party
fielded Dr. Vincent Wijeysingha, Dr. James Gomez, and Dr. Ang Yong Guan,
while the Workers’ Party nominated John Yam, who holds a PhD in Philoso-
phy. This showed that a growing number of intellectuals were interested in
taking an active part in politics, defending pluralist concerns. Last but not
least, younger voters, the voting age in Singapore is 21, played a much more
active role than in the past. This not only enhanced the competitiveness of
the elections but, as I argued previously, marked the change toward a com-
petitive authoritarian regime.34
The election result was impressive. The opposition increased its share
of elected seats to six, its highest number of directly elected seats since in-
dependence. In particular, the opposition Workers’ Party was able to capture
the Aljunied Group Representative Constituency (GRC) with five members,
which can be regarded as a «psychological breakthrough for challengers».35
Moreover, the ruling party suffered a decline in the popular vote from 66.6%
to 60.1%. Even though this was still a very high vote share, it was the lowest
since 1968, when the Barisan Sosialis, which had called on people to boycott
the «undemocratic elections for the Lee Kuan Yew puppets»36 dropped out
of electoral politics.
This development was the result of several factors. One was the emer-
gence of online media, which allowed Singaporeans to learn more about the
opposition, its manifestos and campaign activities. The Internet provided a
low cost option for cash-strapped opposition parties to reach more voters.
Accordingly, Singaporeans were able for the first time ever to see the mas-
sive turnout at opposition election rallies from the comfort of their home.
34. Stephan Ortmann, ‘Singapore: Authoritarian but newly competitive’, Jour-

nal of Democracy, 22, 4, 2011, pp. 153-164.
35. Netina Tan, ‘The 2011 general and presidential elections in Singapore’,
pp. 362-405.
36. ‘Barisan starts its «Don’t vote» campaign’, The Straits Times, 15 February
1968, p. 16.
205
Stephan Ortmann
In addition to the relevance of the new media, the electoral results

were determined by the growing number of bread-and-butter issues facing
Singaporeans, particularly the rapidly rising living costs and changes to the
central provident scheme meant as a safeguard for retirement. By 2011,
the golden years of rapid economic development were over, as economic
growth remained modest. The Swiss living standard that had been promised
seemed a distant dream for many middle income Singaporeans.37 The rise
of online media also contributed to the fact that, unlike in previous elec-
tions, when attacks on the character of the opposition and local concerns
dominated, national issues became the central focus of the election. For
example, in 2006 the mainstream media were dominated by a story about
opposition candidate James Gomez, who had been accused of being a liar
after he had made a mistake during the registration process.38
Despite the advances of the opposition, it is important to remember
that the PAP was still able to garner massive support thanks not only to
the many systemic advantages but also its willingness to adapt to the new
realities. Most notably, the party engaged with the internet in new ways. The
prime minister answered questions on Facebook to allow for some interac-
tion with the leadership.39 Moreover, despite initial trepidations, the PAP
showed itself willing to engage in a televised debate. Finally, the prime min-
ister responded to public discontent by apologizing for all mistakes during
the electoral campaign. This was meant to demonstrate a willingness of the
ruling party to listen to the public and make adjustments to its policies. By
itself, the new populism revealed a major shift from the elitist approach of
the past, when the PAP government publicly touted its ability to decide in
the long-term interest of the country even if it meant unpopular measures
in the short-term.40
Subsequent elections demonstrated that Singapore’s politics had be-
come more competitive than in the past. The 2011 presidential election
saw four candidates competing for the office with three candidates having
a strong following. The candidate supported by the ruling party, Tony Tan,
only narrowly won the election with 35.2% of the popular vote and a very
small margin over Tan Cheng Bock, who was supported by moderate voters.
Liberals and civil activists, who wanted more fundamental political change,
supported Tan Jee Say, who promoted the idea of a conferring real politi-
37. Goh Chok Tong, ‘A Distinctive City, A Harmonious Home’, speech at the
Redas 50th anniversary dinner, 5 November 2009 (http://www.news.gov.sg/public/
sgpc/en/media_releases/agencies/micacsd/speech/S-20091105-1.print.html).
38. James Chin, ‘The General Election in Singapore, May 2006’, Electoral Stud-
ies, 26, 3, 2007, pp. 699-724.
39. ‘PM Lee fields more than 5,000 questions on Facebook’, asiaone, 5 May 2011,
(http://news.asiaone.com/News/AsiaOne+News/Singapore/Story/A1Story20110504-
277171.html#sthash.a0I0iBRU.dpuf).
40. Eugene K.B. Tan, ‘Singapore: Transitioning to a «New Normal» in a post-
Lee Kuan Yew Era’, Southeast Asian Affairs, 2012, pp. 265-282.
206
Singapore 2011-2015
cal power to the president – who, presently, is a mere figurehead. Tan Jee
Say was able to gain another 25% of the popular vote. The election overall
demonstrated the problem of plurality voting, especially since there was no
second round between the leading contenders. However, it also showed that
there was a high demand to have alternative voices in government.
The most pressing issue in this period was the possible impacts re-
sulting from the massive immigration.41 The largest immigrant group was
made up by low-income foreign workers who filled jobs Singaporeans ei-
ther did not like or would not do for the wages employers were willing
to pay. The lack of labour protection for these exploitable workers was
another benefit. However, this brought about a reaction, giving rise to new
forms of social activism, and a counter reaction, exemplified by the rejec-
tion of this new forms of social activism on the part of many Singaporeans.
When 171 Chinese bus drivers went on a strike in late November 2012
over unequal pay and poor living conditions, the government declared
the strike illegal, arrested four drivers, who were eventually condemned
to serve six to seven week jail and deported 34 drivers.42 Many Singapore-
ans supported the government decision.43 The poor conditions of foreign
workers also contributed to another major event. On 8 December 2013,
triggered by the accidental death of a foreign worker who had been run
over by a bus, 400 demonstrators, mainly Indian nationals, became in-
volved in a violent riot in the famous Little India district, which caused
massive damage to emergency vehicles. 18 people including 10 police offi-
cials were injured.44 Official accounts have blamed the riot on «mispercep-
tions about the accident and response, certain cultural and psychological
elements present in the crowd, and the consumption of alcohol by some
members of the crowd».45 Not included, were social problems caused by
the exploitation of foreign labour such as long working hours, little enter-
tainment, and crammed living conditions. This blatant omission clearly
41. Of Singapore’s population of 5.26 million, 2 million are foreigners, which

amounts to 38% of the total, Department of Statistics 2015 (http://www.singstat.gov.
sg). In 2013, about 4,000 people protested against a government White Paper which
suggested the need to plan for a population increase to 6.9 million and thus indi-
cated a continuation of the rapid immigration numbers. ‘«4,000 turn up at Speakers»
Corner for population White Paper protest’, Yahoo! News, 16 February 2013 (https://
sg.news.yahoo.com/huge-turnout-at-speakers—corner-for-population-white-paper-
protest-101051153.html).
42. Chun Han Wong, ‘Singapore Strike: The Full Story’, The Wall Street Journal,
31 August 2013.
43. Haroon Siddique, ‘Singapore’s first strike in 25 years shines spotlight on
racial tensions’, The Guardian, 28 November 2015.
44. Neo Chai Chin, ‘Litte India riot: 18 injured, 27 arrested’, Today, 8 December
2013.
45. Singapore Ministry of Home Affairs, Report of the Committee of Inquiry into the
Little India Riot on 8 September 2013, 27 June 2014.
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Stephan Ortmann
revealed the limitations of authoritarianism in Singapore. Not only are

the Singapore’s media unwilling to challenge the government’s version
of the event, but also the commission was hamstrung in finding the actual
cause of the riot not only because government officials such as Lui Tuck
Yew had already blamed the violence on alcohol abuse,46 but also as a con-
sequence of the fact that the workers, because of the precarious nature of
their employment contracts, subjecting them to immediate repatriation,
self-censored their opinions.
Concerns about immigration, rising prices and the frequent problems
of the public transport network played an important role in the victory of
the Workers’ Party in the Punggol East by-election on 26 January 2013, one
of two by-elections in which the opposition party was able to win.47 Strong
demand for alternative voices in parliament convinced a significant number
of people to switch their vote from PAP to Workers’ Party.48 The electoral
volatility in these by-elections amply revealed that voters were willing to vote
for credible opposition candidates. This stood in great contrast to by-elec-
tions in the 1970s, which the ruling party used for political renewal. Clearly,
in 2011 the hegemonic position of the PAP was in decline, but, the general
election of 2015 was to show, the party still maintained a significant popular
support.
4. The 2015 general election: A major setback or an aberration?
While there was hope for the opposition to make limited progress
in the 2015 general election held on 11 September, the loss of almost 10
percentage points led to a massive disillusionment among many suppor-
ters. Speaking to television reporters immediately after the results were an-
nounced, the head of the Reform Party, Philip Jeyaretnam, said: «I guess
Singaporeans get the government they deserve, so I don’t want to hear any
more complaints.»49 This frustration resonated with many supporters of the
opposition, who used the response as a meme on social media. So what
had happened? Why did Singaporeans seemingly withdraw their support
from the opposition? Above all, did this election mean that Singaporeans
had «overwhelmingly endorsed a form of technocratic authoritarianism and
46. J.T. Quigley, ‘Singapore’s Little India Riot: Was Alcohol to Blame?’, The
Diplomat, 10 December 2013.
47. Alex Au Waipang, ‘PAP suffers 10.83% swing in Punggol East by-election’,
Yawning Bread, 27 January 2013.
48. Stephan Ortmann, ‘The Significance of By-elections for Political Change in
Singapore’s Authoritarian Regime’, Asian Survey, 54, 4, 2014, pp. 725-748.
49. Cassandra Chia, ‘How did an expected watershed election turn into an un-
expected landslide victory?’, The Online Citizen, 14 September 2015.
208
Singapore 2011-2015
turned their back on any prospect on the development of a two-party demo-

cracy» as Michael D. Barr suggested?50
Clearly, the election demonstrated that the ruling party was still capa-
ble to generate massive support for itself. The ruling party won the elec-
tion with 69.9%, which constituted the largest vote share in a long period
of time. The opposition parties, on the other hand, were reduced to their
30% electoral base. The PAP even recaptured a seat it had lost during the
Punggol East by-election in 2012. Moreover, while the Workers’ Party was able
to hold on to the six seats it had won in the 2011 election, its overall vote
margin in both Hougang and Aljunied was significantly reduced. Overall,
the election was undoubtedly an electoral landslide for the ruling party.
The outcome of the election cannot, however, be explained by refe-
rence to a single factor but is function of a number of different factors. It is,
moreover, impossible to determine which of the factors actually dominated
as it is hard to disaggregate them. First of all, the ruling party continues to
rely heavily on the popularity of its traditional policies in the fields of law
and order, defence and national security, prevention of corruption, crisis
management, and relations between the different «races».51 Secondly, it ne-
eds to be recognized that the PAP has made significant policy changes since
the 2011 election, which, while not fundamentally changing the conservati-
ve neo-liberal nature of the government, did introduce new social measures
that gained the support of many Singaporeans. The ruling party has beco-
me more responsive to the public. For instance, it has reacted to demands to
limit the influx of foreigners. Also, it has provided more financial assistance
to low income citizens. As the pro PAP shift among voters came mostly from
wealthier Singaporeans in middle and upper income groups,52 the hypo-
thesis can be made that the these social groups are expressing their concern
at the prospect of greater wealth redistribution, should the opposition gain
more influence.
Another important reason for the election outcome is the effective use
of timing. Although the election could have waited until January 2017, it
was called in a year in which the party could only hope to profit from events
that allowed the ruling party to draw attention to its past achievements.53
The first was Lee Kuan Yew’s death on March 23, which was followed by a
50. Michael D. Barr, ‘Singapore’s PAP wins over the youth and secures its fu-
ture’, East Asia Forum, 15 September 2015.
51. Chong Zi Liang, ‘GE2015: 7 takeaways from IPS post-election conference
that explain PAP’s performance’, The Straits Times, 4 November 2015. The term «race»
– although by now devoid of any scientific meaning – appears in the constitution of
the Singapore and is used by the Singapore government and by the media to indicate
the four ethnic groups in which the population of the city-state is divided: Chinese,
Malay, Indian and Other (or Eurasian).
52. Ibid.
53. Rachel Chang & Wong Siew Ying, ‘Elections: A question of timing’, The
Straits Times, 23 May 2015.
209
Stephan Ortmann
week-long period of mourning in which any criticism of his heritage was

considered out-of-bounds.54 Singaporeans stood in line for many hours to
pay their last respects to the iconic leader. Television channels constantly
broadcast documentaries about his legacy. Any criticism of his actions, for
instance the arrest without warrant of political opponents, was considered as
disrespectful. These events demonstrated the strength of Lee’s personality,
which had provided significant charismatic leadership for the ruling party.
When one youngster declared that Lee Kuan Yew was a «horrible person» in
a video uploaded to Youtube, at least 20 police reports were lodged against
him.55 He was later arrested and, although charged and convicted for other
charges, he served a four week sentence.56 Similarly, the country’s 50-year
anniversary also provided an opportunity to stress past achievements. De-
spite Lee Kuan Yew’s death, festivities proceeded as planned. These inclu-
ded a massive military parade, which again paid tribute to the late «foun-
ding father» of the country. Lee’s speech following Singapore’s separation
from Malaysia in 1965, was broadcast on radio. In addition, the celebrations
were a boon for marketing as many shops made use of the opportunity to
sell SG50 themed products.57 To one observer, these events «felt like a re-
minder to the country’s younger, sometimes disgruntled, generation that it
should not take Singapore’s remarkable successes for granted.»58
Of course, it is important to remember that despite all changes, the
ruling party still maintains tight control over most aspects of society. The
media, which frame the issues mentioned above, still remain biased in fa-
vour of the ruling party. Although many people are concerned with the lack
of fairness in the media, traditional media, especially television, remain the
primary source of information, the influence of online information being
still limited.59 This happens even because the government is actively enga-
ged in trying to reduce the impact of social media by making use of various
means, including tighter registration requirements and lawsuits against in-
dividual content providers. In contrast to the situation prevailing on the eve
54. ‘Singapore begins mourning for Lee Kuan Yew’, Aljazeera, 23 March 2015;
‘The intolerance of grief ’, Banalysis, 27 March 2015 (https://stuffaboutsingapore.
wordpress.com/2015/03/27/the-intolerance-of-grief).
55. Lucy Clarke-Billings, ‘Teenage blogger who called Lee Kuan Yew a «hor-
rible person» is arrested by Singapore police’, Independent, 30 March 2015; Joyce
Lim, ‘Amos Yee, who made insensitive remarks on Christianity in video, arrested’, The
Straits Times, 30 March 2015.
56. He was found guilty for insensitive comments about Christianity and an
obscene image.
57. The acronym «SG50», namely «Singapore50», indicates the 50th anniver-
sary of Singapore’s independence.
58. Tash Aw, ‘A Singapore story: Mourning Lee Kuan Yew’, The New York Times,
30 March 2015.
59. Chong Zi Liang, ‘GE2015: 7 takeaways from IPS post-election conference
that explain PAP’s performance’ (quoted in fn. 51).
210
Singapore 2011-2015
of the 2011 election, the ruling party has become the political organization
with the highest number of followers on Facebook, overcoming even the
most popular opposition party, the Workers’ Party.60 This showed that the
ruling party was effectively using its access to resources to play an important
role online.
The factors mentioned so far suggest that the election outcome was
the result of genuine popular support for the PAP’s past achievements and
an indicator that people at large believed that the PAP was moving in the
right direction. But was it also a sign that the people were content with the
technocratic and undemocratic form of governance? There are indicators
that, in fact, this was not the case. According to a survey by the Singapore-
an Institute of Public Policy, a majority of Singaporeans believe that there
should be more diversity in parliament.61 Not only is political pluralism
highly valued but Singaporeans attach great importance to the concept of
checks-and-balances. Moreover, many voters dismissed the attempts of the
ruling party to discredit the opposition with scandals such as the widely pu-
blicized administrative problems of the opposition Town Council. Despite
this issue, the Workers’ Party was actually able to improve its own credibility.62
Even Dr. Chee Soon Juan, the leader of the Singapore Democratic Party, who
had been persecuted as well as demonized in the past, made a comeback as
many people queued up to get his autograph.63 Only three years earlier, he
had been able to annul his bankruptcy, which allowed him to compete again
as a candidate. There was clearly a desire to have an opposition to ensure
that the PAP listened to the demands of the public.
5. Conclusion
In 2011 and 2015, Singapore experienced two very different general

elections: the former was a watershed in the way it demonstrated that the
Southeast Asian city-state was moving toward a competitive authoritarian
regime; the latter, on the contrary, revealed the continuing strength of the
ruling party. Whereas elections have remained highly contested, the PAP
60. As of 7 December 2015, the PAP has 173,427 likes and the Workers’ Party
95,053 likes according to https://www.facebook.com.
61. Tan Ern Ser, ‘Session One: The IPS General Election Surveys’, presentation
at Orchard Hotel in Singapore on 4 November 2015 (http://lkyspp.nus.edu.sg/ips/wp-
content/uploads/sites/2/2015/10/S2_ES_Explaining-the-GE2015-outcomes-041115_
Web.pdf).
62. Ibid.
63. Nurul Azliah Aripin, ‘GE2015: 5 most memorable moments from SDP’s
first lunchtime rally’, Yahoo! News Singapore, 7 September 2015 (https://sg.news.ya-
hoo.com/ge2015—5-most-memorable-moments-from-sdp-s-first-lunchtime-rally-
100725400.html).
211
Stephan Ortmann
remains firmly in control. As things presently stand, it is unlikely that the

opposition will be able to field a successful challenge, resulting in the trans-
formation of competitive authoritarianism into liberal democracy. This re-
mains the case, even as the Singaporean population increasingly demands
more checks on government power.
However, Singapore’s increasingly competitive politics has led to a
transformation of the PAP from a technocratic to a more populist party.
Whether it can adapt to this change will be the ultimate test for the ruling
party. As the current Prime Minister Lee Hsien Loong, Lee Kuan Yew’s son,
is set to retire, a leadership transfer is expected in the near future. As no
consensus as hitherto emerged on the name of his successor,64 an internal
leadership struggle could be in the offing. This could further put under
pressure the ruling party ability to maintain its hegemonic position.
64. Possible candidates include Chan Chun Sing (Minister in the Prime Minis-
ter Office), Tan Chuan-Jin (Minister for Social and Family Development), Heng Swee
Keat (Minister for Education), and a favourite among many Singaporeans is Thar-
man Shanmugaratnam (Deputy Prime Minister and Minister for Finance).
212
MalaYsia 2015: naJib razak’s hardest Year
Stefano Caldirola
University of Bergamo
stefano.caldirola@unibg.it
In 2015 Malaysian Prime Minister Najib Razak’s leadership was badly shaken by
the eruption of a huge corruption scandal in July. This same scandal contributed to
making the Malaysian economic outlook negative, while the national currency fell
to an all-time low against the US dollar. This was accompanied by a massive protest
movement (Bersih 4.0), aimed at forcing Najib’s resignation, a goal that, however, at
least up to the time of writing, has not been reached. At the same time, clear signals of
discontent towards Najib’s leadership started to become visible even within UMNO,
the Prime Minister’s own party.
In November the announcement was made that the Trans-Pacific Partnership (TPP)
agreement had been signed by the Trade Ministers of 12 countries, including Malaysia.
As the TPP is considered an important aspect of the US strategy to counter China’s
influence in the Asia-Pacific region, Malaysia’s presence among the TPP signatories
highlighted its role as a US strategic partner in the region. That same role was
highlighted once again by Barack Obama’s November visit to Kuala Lumpur, on the
occasion of the US-ASEAN meeting. However, Malaysia’s behaviour vis-à-vis China,
in the months before the TPP announcement, showed that Kuala Lumpur’s closeness
with the US was qualified by the need not to enter on a collision course with Beijing.
Although Malaysia too has been involved in the disputes pitting China against several
ASEAN countries in the South China Sea, Kuala Lumpur’s protests against Beijing’s
assertiveness have been particularly weak. Indeed, Malaysia appears to be trying to
perform a kind of balancing act, trying to appease both the US and China. At the same
time, Malaysia, as Chairman of ASEAN for 2015, maneuvered to moderate the more
aggressive anti-China positions of some of the other ASEAN members.
1. Introduction
2015 was a year of domestic controversies in Malaysia, mainly related to

the leadership of Prime Minister Najib Razak. The jailing of the opposition
leader Anwar Ibrahim on an old and controversial allegation of «sodomy»
came just before the eruption of a huge scandal related to a state-owned
investment company called 1Malaysia Development Berhad (1MDB).
The 1MDB scandal personally involved the Prime Minister and cost him
credibility and part of his political capital.
Even before and independently of the 1MDB scandal, Malaysia had
been confronted by many challenges in 2015. This was the year of the final
negotiation of the Trans-Pacific Partnership (TPP) of which Malaysia was

Stefano Caldirola
one of the most enthusiastic and assertive supporters. At the same time,
2015 was important for the future of the Association of South-East Asian
Nations (ASEAN), of which Malaysia is one of the founding members and
was the chairman for the year under review. On 1 January 2016, ASEAN
was expected to become a real integrated market, due to the fall of barriers
and the establishment of a commercial union.1 Accordingly, ASEAN in 2015
gave Malaysia the responsibility for leading this union of ten countries to the
conclusion of a process that started back in 1967. However, while the process
of economic integration was undoubtedly progressing, ASEAN appeared
divided on many political issues, above all the attitude to take towards
China. Whereas China is the main economic partner of most of the ASEAN
members, it has territorial disputes with many of them, including Malaysia.
The positions within ASEAN, related to China’s assertiveness in the South
China Sea, showed important divisions among its members. Malaysia tried
to moderate these divisions, while at the same time attempting to appease
both China and the Unites States, the latter being a traditional Malaysian ally.
In the remainder of this chapter all these issues will be analysed. The
first to be put under examination will be the eruption of the 1MDB scandal
and its political and economic implications.
The second problem to be analysed will be the state of the Malaysian
economy, a special emphasis being placed on the plummeting of the ringgit,
the national currency, which was under pressure for the whole year for many
reasons, not least the eruption of the 1MDB scandal.
The third issue to be discussed will be the domestic political situation,
characterised by the collapse of the united opposition and the launching
of a new street protest by civil society organisations, giving rise to the
so called Bersih 4.0 movement. However, it will be shown that the main
challenge to Najib Razak’s leadership came from within his own party,
the United Malay National Organisation (UMNO). Signals of discontent
became frequent after the involvement of the Prime Minister in the 1MDB
scandal was exposed in July. Najib had to deal both with the vitriolic
attacks from the former Prime Minister Mahathir Mohammed and with
the rebellion of important party cadres. Despite all these problems,
eventually Najib managed to maintain his control over his party and hold
on to his Prime Ministership. In December, the UMNO general assembly
was unusually tense and difficult. Challenged by a section of his own party,
dealing with a huge scandal and confronted by an economic slowdown
1. As expected, the birth of the AEC (ASEAN Economic Community) was an-
nounced on 1 January 2016. Because the present chapter deals with the year 2015,
this topic is not discussed here. However, for some introductory remarks on the sub-
ject – which will be examined in Asia Maior 2016 – see: Patrick Low, ‘ASEAN Eco-
nomic Community faces numerous challenges’, South China Morning Post, 6 January
2016; and Deborah Elms, ‘Witnessing the birth of the ASEAN Economic Community
(AEC)’, Asian Trade Centre, 12 January 2016.
214
Malaysia 2015
and a currency crisis, Najib faced his hardest year since the beginning of
his prime ministership in 2009. Nevertheless, Najib showed his ability to
bounce back and to continue to lead his country.
The fourth issue to be dealt with will be Malaysia’s foreign policy,
particularly with respect to the relations with China and the US.
2. The 1MDB scandal
«1Malaysia Development Berhad»2 originated from a sovereign

wealth fund, named Terengganu Investment Authority (TIA). TIA, founded
in 2008, aimed at promoting the economic development of Terengganu, a
state situated in north-eastern Peninsular Malaysia. In January 2009, TIA
was renamed 1Malaysia Development Berhad (1MDB) and its activities
were expanded to the whole of Malaysia. This development was part of
the big and pompous «1Malaysia Plan», announced by Najib Razak on 16
September 2008, when he was not yet the Prime Minister, but the Deputy
Prime Minister and the heir apparent to the then Prime Minister Abdullah
Ahmad Badawi.3 The company was run by a Board of Advisors, a Board
of Directors, and a Senior Management Team. The Board of Advisors was
chaired by the Prime Minister himself.4
Initially 1MDB’s focus was mainly on real estate, energy, tourism
and agribusiness. In 2009, the decision of the company to get involved
in funding the huge Tun Razak Development Project drew criticism from
the parliamentary opposition. The lack of transparency in the company’s
governance was another important source of criticism. The then opposition
leader, Anwar Ibrahim, openly questioned the lack of transparency in
the governance of 1MDB and went as far as to insinuate that the Prime
Minister himself might have some personal interest in the funding of the
project.5 In 2010, another member of parliament from the opposition, Tony
Pua, questioned Najib’s role as chairman of the 1MDB Advisory Board,
complaining about the lack of transparency in the accounts of the company.6
2. Berhad in Basha Malay means «private».

3. United Malays National Organisation - Ideology - 1Malaysia (http://www.liqui-
search.com/united_malays_national_organisation/ideology/1malaysia). See also Of-
fice of the Prime Minister, Putrajaya, Malaysia, National unity ultimate objective of 1Ma-
laysia, says Najib, 16 June 2009.
4. For some introductory information on the 1MDB, see its official website at
http://www.1mdb.com.my/, and Bloomberg’s Company Overview of 1Malaysia Develop-
ment Berhad (http://www.bloomberg.com/research/stocks/private/snapshot.asp?priv-
capId=140313786).
5. Joseph Sipalan, ‘Government Gambling on Untested 1MDB’, Malaysiakini,
18 October 2015.
6. Clara Chooi, ‘Pua says 1MDB profits suspect’, The Malaysian Insider, 9 Octo-
ber 2010.
215
Stefano Caldirola
In September 2013 the 1MDB attracted attention once again, as it asked

for a six-month extension in presenting its annual report. All this occurred
in spite of the fact that the 1MDB accounts had regularly been audited by
international firms such as KPMG and Ernst and Young.7
At the beginning of year 2015, it became public knowledge that 1MDB
was in deep crisis and that it had accumulated losses worth 42 billion of
ringgits (more than 11 billion US dollars).8 This huge debt caused both the
value of the ringgit to plummet and the country’s economic outlook to worsen.
In March, an investigative journalism portal – Sarawak Report – began
alleging that a controversial Penang based businessman, Jho Low, had
initiated a joint venture with 1MDB and Petro Saudi International, which
had allowed him to pocket US$ 700 million.9 While both Petro Saudi and
1MDB denied any connections with Jho Low, the same portal alleged in July
that US$ 1.16 billion from 1MDB had been transferred to the account of a
company controlled by Jho Low, Good Star Limited, and that, through this
company, over US$ 700 million had been deposited in a personal account
made out to Najib Razak.10 The report alleged that even the prime minister’s
wife, Rosmah Mansor, had benefited from a transfer of cash to her personal
account made by Jho Low, and had received valuable gifts such as jewellery
and gold.11 After this report as many as five international police teams,
including the FBI, started to investigate 1MDB’s accounts around the world.12
Najib, while dismissing any allegation of corruption, launched a
campaign targeting whoever might criticize him. He sacked his deputy
prime minister, Muhyiddin Yassin, along with four ministers for their tepid
defence of his person after the scandal came to light.13 Then Najib, at the
beginning of August, started a more vigorous counterattack campaign. On
1 August, clearly referencing the editor and founder of Sarawak Report –
Clare Rewcastle Brown, a British citizen born in Malaysia – Najib said that
«white people should stay out of Malaysia’s affairs».14 After three days a Kuala
Lumpur Court issued an arrest warrant for Rewcastle-Brow «for activities
7. ‘KPMG EY terminated from auditing 1MDB, auditors tell PAC’, The Malay-
sian Insider, 17 June 2015.
8. ‘Ringgit under pressure over 1MDB Debt’, The Malaysian Insider, 23 February
2015.
9. ‘Jho Low allegedly siphoned off US$700 million from 1MDB, says website’,
The Malaysian Insider, 1 March 2015.
10. ‘Sensational Findings! Prime Minister Najib Razak’s Personal Accounts
Linked To 1MDB Money Trail’, Sarawak Report, 2 July 2015.
11. Ibid.
12. Saheli Roy Choudhury, ‘Timeline: the Twists and Turns in the tale of
1MDB’, CNBC, 21 September 2015.
13. Oliver Holmes & David Munk, ‘Malaysian PM Najib used state funds for
bribery, says former leader Mahathir’, The Guardian, 23 October 2015.
14. Kamles Kumar, ‘White people’ should stay out of Malaysia’s affairs: Najib
says’, The Malay Online, 1 August 2015.
216
Malaysia 2015
detrimental to parliamentary democracy under Section 124B and 124I

of the Penal Code».15 However, Interpol, after receiving the international
arrest warrant, rejected it and finally dismissed it on 27 August.16
3. The Economy: the fall of the ringgit
Following the eruption of the big scandal involving the leadership

of the country at the highest level, the outlook of the Malaysian economy
became negative and the ringgit fell to an all-time low against the US dollar.
However, the state of the Malaysian economy had already been faltering
even before the scandal broke out over the summer. The low international
prices for crude oil and other commodities – such as palm oil, of which
Malaysia is the second largest producer worldwide – had hit the country
hard. The deceleration of the Chinese economy had affected Malaysian
exports too, particularly because China was the major destination for
Malaysian commodities and manufactured goods. Malaysia recorded
its 13th consecutive month of falling exports in October.17 Despite these
difficulties, the Malaysian GDP growth projection for 2015 was at 4.7%, a
healthy level given the global environment and the domestic financial and
political turmoil.18 Domestic demand remained high and grew by 5.9%,
despite the introduction of the new Goods and Services Tax (GST),19 on
which more later. Furthermore, the export forecasts seemed to improve,
due to the depreciation of the ringgit, whereas the possibility took shape
that the robust growth in the US might partially compensate for the Chinese
economic slowdown.
The value of the Malaysian currency started to drop at the end of
2014, reaching 3.44 against the US dollar on 3 December 2014, its lowest
point since February 2010. Then, in the first quarter of 2015, the value of
the ringgit dropped again. In March the exchange rate went down to 3.71
against the US dollar, and, in June, further declined to 3.77, the lowest
level since January 2006.20 However, in August, after news started making
the rounds of a huge debt accumulated by 1MDB, the ringgit broke another
negative record, plummeting to 4.00 against the US dollar. This was an even
15. ‘Malaysia obtains arrest warrant for Sarawak Report founder’, The Straits
16. ‘Interpol rejects Malaysian cops’ red notice bid on Clare’, Malaysiakini, 27
August 2015.
17. ‘Exports contraction moderates in December’, Focus Economics, 2015 (https://
www.focus-economics.com/country-indicator/malaysia/exports).
18. The World Bank, Malaysia Economic Monitor, June 2015 (www.worldbank.
org/en/contry/malaysia/publication/malaysia-economic-monitor-june-2015).
19. Ibid.
20. ‘Ringgit falls on reduced demand as Europe prepares for Greek debt de-
fault’, The Malay Online, 12 June 2015.
217
Stefano Caldirola
lower value than that witnessed in the aftermath of the big Asian financial
crisis of 1997, when the ringgit-US dollar exchange rate reached 3.80 to 1.21
This fall had much to do with the decline in the price of commodities
at the international level. Other reasons were the devaluation of the Chinese
yuan, which strengthened the US dollar against other Asian currencies. But,
after July 2015, a powerful additional cause was the 1MDB debt. Prime
minister Najib Razak’s involvement in the scandal, evidence of huge
mismanagement of public money, and uncertainty about the real dimension
of the company’s debt pushed international rating companies, such as Fitch,
to change the long-term outlook for Malaysia from stable to negative.22 Even
though the Governor of the Malaysian Central Bank, Ms. Zeti Akhtar Aziz,
tried to reassure investors, claiming in June that the continuing weakening
of the ringgit was a short-term problem,23 in July a Financial Times report
predicted that the ringgit was expected to sink even more, reaching 3.88 by
the end of the year.24 In fact, as already noted, this forecast, which created
panic among international investors, was even too optimistic, given that the
ringgit plunged to 4.00 against the US dollar at the end of December.
Furthermore, Malaysia’s deficit problem remained unresolved. The
new Goods and Service Tax (GST), discussed by the Malaysian political élite
since 1992, was finally implemented on 1 April 2015. This new tax, which
aimed at replacing a complicated system of sales taxes and service taxes, was
considered a priority by international observers. In 2013, in its Structural
Policy Country Notes, the Organization for Economic Co-operation and
Development (OECD) had stated that «Malaysia should introduce a GST
as soon as possible».25 According to international agencies, the GST should
bring broad and steady fiscal revenue for a state such as Malaysia, which has
registered high deficit levels and high public debt in the past few years. But
the GST rate was put at a mere 6%, while 13 economic sectors – the most
important, including all agricultural products and all exported goods and
services – were exempted from it.26 Thus, it is unlikely that the introduction
of the GST will have any significant impact on the deficit. Given the fact that
direct taxation is also very low, and given that public expenses continued to
21. International Monetary Fund, ‘Malaysia Recent Economic Developments’,

Staff Country Reports, Washington: International Monetary Fund Publication Services,
1999, p. 1983.
22. ‘Fitch affirms Malaysia’s LTFV rating at A-’, 30 June 2015 (www.fitchratings.
com/site
/fitch-home/pressrelease?id=987210).
23. Ramon Navaratham, ‘The declining ringgit – is it temporary?’, Free Malaysia
Today, 11 June 2015.
24. Mabel Ho & Ling Low, ‘Why is the value of the ringgit falling?’, Poskod.my,
July 2015.
25. OECD, Structural Policy Country Notes, Malaysia, 2013.
26. ‘Essential items, services to be exempted from Malaysia’s GST’, The Straits
218
Malaysia 2015
grow even in many unproductive sectors, it is not surprising that the goal,
announced by the Malaysian government, of bringing the deficit below the
3% of GDP was not reached in 2015.27
4. The collapse of the united opposition
The explosion of the 1MDB scandal should have been a godsend

opportunity for the opposition, formally unified in the Pakatan Rakyat
(People’s Alliance). But the Pakatan Rakyat (PR), which includes three parties
representing different classes and communities that have differing visions for
the future of the country, had found it difficult to survive since the loss of
its leader, Anwar Ibrahim, who was jailed on 10 February 2015 on an old
and controversial conviction for «sodomy». Just a few weeks after Anwar’s
imprisonment, the alliance entered a period of crisis. In fact the relations
between two of the parties of the three-party-alliance – the Islamist Pan-
Malaysian Islamic Party (PAS) and the secular, and ethnically largely Chinese,
Democratic Action Party (DAP) – were already badly damaged after the
«Kajang move». As noted elsewhere,28 there was a long struggle among the
opposition parties in the second half of 2014 aimed at controlling Selangor,
the richest and most populous state in Malaysia and a stronghold of the
opposition. This struggle directly involved Anwar, who tried to secure the post
of Menteri Besar (Chief Minister), first for himself and then for his wife Wan
Azizah. The result was an open battle between PAS and DAP, with Anwar’s
multi-ethnic People’s Justice Party (PKR) being caught in the middle.
After the long internal fight related to the «Kajang move», the
opposition was briefly able to reunite following the 7 March 2014 Kuala
Lumpur Court of Appeal’s overturn of Anwar’s acquittal. The opposition
parties jointly protested against the decision, which they all claimed to
be politically motivated.29 But divisions soon rose to the surface again
as Anwar’s new conviction left the opposition without the only leader
charismatic enough to heal its divisions. In March, a few weeks after Anwar’s
jailing, controversies emerged within the PR regarding the Prevention of
Terrorism Act (POTA), a law aimed at preventing the spreading of terrorist
ideologies in Malaysia. Many civil society organizations denounced the act
as illiberal and potentially antidemocratic.30 The most controversial piece
27. Rupa Damodaran, ‘Malaysia’s fiscal deficit target challenging: Credit Su-
isse’, The New Straits Times, 13 January 2016.
28. Stefano Caldirola, ‘Malaysia 2014: Reforms and challenges in the year of
flight MH 370’, Asia Maior 2014, p. 157.
29. ‘Malaysia courts upholds Anwar Ibrahim sodomy conviction’, BBC News, 10
February 2015.
30. Amnesty International, Malaysia: New anti-terrorism law a shocking onslaught
against human rights, 7 April 2015.
219
Stefano Caldirola
of the law was the reintroduction of detention without trial for a period up
to 59 days and the fact that the continued detention of a suspected terrorist
after this period would not be confirmed by a normal court but by a special
Prevention of Terrorism Board.31
The controversial law was approved by the Federal Parliament on 7
April 2015, after 12 hours of debate, at 2.25 am, with 79 votes in favour and
60 against.32 Decisive for the approval of the law was the absence of 26 PR
lawmakers. This absence was strongly condemned by PR activists on social
media, and led to a major fracture within the opposition ranks. The absent
lawmakers were mainly from PKR, Anwar’s Party, and from PAS, while those
critical of the absence mainly belonged to DAP.33
In March another issue came to the fore. The enforcement of laws
based on Islamic Law, or Shari‘a, has for years been a source of friction
between PAS and the secular parties, particularly in Kelantan, the Northern
state where PAS has ruled since 1971. At the end of March the Kelantan Le-
gislative Assembly passed some amendments to its Syariah Criminal Code
(II) Enactment, 1993 – namely the local Islamic penal code, also named
«hudud»34 – which quickly became a source of legitimate public concern.
In 1993, the Syariah Criminal Code had established a dual penal system
of punishment, with the Malaysian Penal Code applicable to non-Muslim
citizens, whereas Muslims citizens were subject to the much tougher Isla-
mic Law. Following the 2015 amendments, Islamic norms became, in some
cases, applicable to non-Muslim citizens too.35 Specifically, clauses 56, 57,
and 58 of the act left it to the judge to decide which law to apply in cases
of crimes jointly committed by a Muslim and a non-Muslim. In these cases
the non-Muslim citizen might be subject to the same punishment as the
Muslim, including amputation in the case of theft (clause 58).36 «Many no-
ted that the provisions did not explain if hudud would remain exclusively
applied to Muslims in the event that a criminal act was perpetrated by both
a Muslim and a non-Muslim».37 This move from the PAS alarmed secular
31. Elizabeth Zachariah, ‘POTA not like ISA, deputy prime minister tells crit-
ics’, The Malaysian Insider, 6 April 2015.
32. Karen Arukesamy, ‘POTA passed after heated debate’, The Sun Daily, 7 April
2015.
33. ‘PR pilloried over POTA’, The Borneo Post, 8 April 2015.
34. ‘PAS to table hudud law amendments in Kelantan legislative assembly’, Malay Mail
Online, 14 March 2015; ‘Kelantan State Legislative Assembly passes Hudud Bill’, Astro
Awani, 19 March 2015.
35. Zurairi Ar and Boo Su-Lyn, ‘Snapshot of Malaysia after hudud: A na-
tion divided’, Malay Mail Online, 28 March 2015; Jaclyn L. Neo and Dian A. H.
Shah, ‘Hudud and the Struggle for Malaysia’s Constitutional Soul’, ConstitutionNet.
org, 25 June 2015.
36. Syed Jaymal Zahiid, ‘Despite amendments, not-Muslim left out of Kelan-
tan’s hudud bill?’, The Malay Online, 19 March 2015.
37. Ibid.
220
Malaysia 2015
parties all over the country. In June the frictions became open and PAS vo-
ted to sever ties with DAP.38 PKR, caught in the middle,39 could not do much
to avoid the collapse of the alliance. The three parties continued to work to-
gether in some local administrations, but the prospect that, in a foreseeable
future, the Malaysian parliamentary opposition would once again be able to
act as a united political force appeared improbable.40
5. On the streets again: Bersih 4.0
If the political opposition proved itself unable to capitalize on

the 1MDB scandal because of internal divisions and lack of a common
leadership, the protests against corruption were once again taken up by
Malaysian civil society. The scandal brought people onto the streets again
and led to the birth of a protest movement named Bersih 4.0. The original
Bersih («clean») movement was launched in 2006 to protest against the
unfair electoral system. In those days the official name of the movement
was «Coalition for Clean and Fair Elections» (Gabungan Pilihanraya Bersih
dan Adil) and it was organized by NGOs which sought to reform the existing
electoral system to ensure fairer elections.41 The movement was started
again in 2010 (Bersih 2.0) in response to the reluctance of the government
to meet the protestors’ demands. Later on, in 2012, Bersih 3.0 came to the
fore with a broader set of objectives: they not only sought the reform of the
electoral system, but also set out to fight against corruption in government,
and to promote environmentally linked campaigns, notably the opposition
to the Australian based company Lynas rare earth project.42
The Bersih 4.0 movement, mainly prompted by the 1MDB scandal,
demanded Najib’s resignation. The movement was initiated by a series
of planned rallies carried out on 29 and 30 August 2015, just before the
country’s National Day (August 31). The rallies, held in Kuala Lumpur, Kota
Kinabalu and Kuching, called for clean and transparent governance. The
demonstrations were successful, particularly in the capital city. Despite
many attempts to intimidate protestors and provocations by the police
38. ‘PAS Ulama approves motion to sever ties with DAP… but stay in Pakatan’,
The Malay Online, 3 June 2015; ‘Inevitable split for Pakatan’, Sin Chew Daily, 5 June
2015.
39. ‘PKR won’t cut ties with DAP and PAS’, The Straits Times, 18 June 2015.
40. Prashanth Parameswaran,‘What Does the Collapse of Malaysia’s Opposition
Mean?’, The Diplomat, 16 June 2015; Gabriel Domínguez, ‘Why has Malaysia’s op-
position alliance collapsed?’, Deutsche Welle, 18 June 2015.
41. Stefano Caldirola, ‘La Malaysia in bilico: Najib Tun Razak alla prova delle
elezioni’, Asia Maior 2013, pp. 253–255.
42. Jonathan Head, ‘Lynas learns fate for Malaysia rare earth refinery’, BBC
News, 10 October 2012.
221
Stefano Caldirola
and UMNO supporters,43 the rallies saw the participation of thousands of

people. According to Bersih’s estimations, in Kuala Lumpur alone 250.000
people gathered for the rally, whereas estimates made by the police were,
as usual, much lower (around 25,000).44 There were no major incidents
and, unlike the previous Bersih rallies, police did not intervene with tear
gas or with charges. The movement succeeded in highlighting the political
demands of a large sector of Malaysian civil society. But, as in the previous
editions, the effectiveness of the movement seemed to be low. Interestingly,
former PM Mahathir Mohammed participated in a Bersih rally, a fact which
will be discussed later.
It is interesting to note that the public perception of Bersih 4.0 as
a largely Malaysian Chinese movement was widespread in the country,
particularly among Malays.45 The political divide among Malays and
Malaysian Chinese has grown steadily in the past few years. The recent split
between the opposition parties and the increasing pro-Malay attitude of the
UMNO-dominated government deepened this divide.46
6. The struggle within UMNO: the final stage of arm wrestling between Najib
and Mahathir?
The weakness of the opposition and the limited effectiveness of the protests
coming from civil society organizations explain why Najib was left relatively
unscathed by the 1MDB scandal. However, the main challenge for Najib did
not come from the opposition or the civil society street demonstrations, but
from within his own government and party. As has become usual in the past
years, when a political struggle develops within the National Front (Barisan
Nasional, BN), and particularly within the major party of the coalition, the
UMNO, a central role is usually played by Mahathir Mohamed. This authentic
éminence grise of Malaysian politics, who was prime minister for 22 years (from
1981 to 2003), even though he turned 90 in 2015, still enjoys great prestige
and considerable political influence among both the political establishment
and Malaysian citizens at large. In Malaysia everybody still remembers what
had happened to Anwar Ibrahim and Abdullah Badawi, two former Mahathir
protégés who had dared to challenge him, and, as a consequence, had seen their
political fortunes rapidly decline. The story of Anwar Ibrahim, who was Deputy
Prime Minister and Finance Minister under Mahathir, is widely known and has
43. Rahmah Ghazali & Dina Murad, ‘Bersih 4: ‘«Red Shirts» ready to face off at
rally’, The Star Online, 27 August 2015.
44. Niluksi Koswanage, ‘Thousands of Malaysians Rally in Capital to Demand
Najib’s Resignation’, Bloomberg.com, 29 August 2015.
45. ‘A grand day out; Malaysia’s masses protest against corruption’, The Econo-
mist, 30 August 2015.
46. ‘Playing with fire’, The Economist, 26 September 2015.
222
Malaysia 2015
been told elsewhere by the present author.47 For his part, Abdullah Badawi, who
was Prime Minister from 2003 to 2009, was officially made to step down for
bad economic performance after attracting criticism from Mahathir.48 Indeed
it was Najib Razak who replaced Badawi, with Mahathir’s blessing. However,
by 2013 Mahathir turned his criticism against the new PM, branding his
1Malaysia Plan an «unproductive scheme».49 After the eruption of the 1MDB
scandal, Mahathir started attacking the prime minister personally. He openly
criticized the «lavish» lifestyle of Najib’s wife in his blog and advocated the
PM’s resignation.50 On 30 August he went as far as to participate in the Bersih
4.0 rally, whose participants were labelled by Najib as «shallow and poor in
patriotism».51
On 12 October Mahathir strongly criticized Najib again, asserting
that Malaysia under the Najib government had become a «pariah» state.
He wrote on his blog: «In the eyes of the world Malaysia has become a
pariah state, a state where anyone can be hauled up and questioned by the
police, detained and charged through abusing laws of the country».52 After
a few days, during an extensive interview with the British newspaper The
Guardian, Mahathir made public a private conversation he had had some
months before with Najib. The contents of this interview proved to be very
embarrassing for the incumbent Malaysian PM. Mahathir said: «What he is
telling me is that bribery is OK. If you bribe with a few dollars, I suppose
it doesn’t work, but if you give [money] to a person who has never seen a
million ringgit he will turn around».53 Mahathir, in the interview, went on
to say: «The only thing that we can do is to have the Prime Minister resign
or step down or to be removed. Because he is the principal person who has
brought about this bad image for the country».54
Mahathir has indeed remained influential in Malaysian politics but,
at the moment of writing, it is still not clear how much harm he had caused
the incumbent PM with his vitriolic attacks. He advocated a confidence
flight MH 370’, Asia Maior 2014, pp. 156–160.
48. Bridget Welsh & James H. U. Chin (eds.), Awakening. The Abdullah Badawi
Years in Malaysia, Strategic Information and Research Development Centre, Kuala
Lumpur, 2013, pp. 3–66.
49. ‘Mahathir: No need to continue BR1M in Budget 2014’, ABN News, 20 Oc-
tober 2013.
50. Thomas Fuller & Louise Story, ‘Power Struggle in Malaysia pits former pre-
mier against a Protégé’, The New York Times, 17 June 2015.
51. ‘Najib says Bersih rally participants «shallow and poor» in patriotism’, The
Straits Times, 29 August 2015.
52. Lindsay Murdoch, ‘A pariah state: Dr. Mahathir intensifies attack on Malay-
sian PM Najib Razak’, The Sydney Morning Herald, 12 October 2015.
53. Oliver Holmes & David Munk, ‘Malaysian PM Najib used state funds for
bribery, says former leader Mahathir’, The Guardian, 23 October 2015.
54. Ibid.
223
Stefano Caldirola
motion be launched against Najib in parliament but the opposition

held back with respect to this matter.55 As already noted, the three main
opposition parties were deeply divided and probably did not want to
push for a resignation that might lead to an unknown scenario, possibly
dangerous for the opposition too.
Given the reluctance of the opposition to push strongly against Najib,
Mahathir’s appeal received a warmer response from some UMNO MPs. This
was the case of the Kedah MP Anina Saadudin who, on 28 August, filed a
lawsuit against Najib.56 The allegations made by Ms. Saadudin concerned the
misuse of party funds. She went to court to recover, on behalf of UMNO, 2,6
billion Malaysian ringgit (around US$ 650 million), which were reportedly
in the PM’s private accounts.57 However, shortly after this, she was expelled
from the party.58
Up to the time of writing, Najib has been able to resist any attempt to
remove him from his post as Prime Minister. Notwithstanding the growing
pressure on him, Najib still enjoyed the backing of most of UMNO’s
powerful division chiefs.59 However, in November, at least some among the
UMNO division chiefs urged Najib’s resignation. For his part, UMNO’s
Deputy President and former Deputy Prime Minister Muhyiddin Yassin
demanded a full explanation on the 1MDB issue.60 The general assembly of
UMNO on 10 December was one of the most agitated in the history of the
party. Usually these meetings are quite routine and generally smooth; but in
November 2015 the assembly had to deal with protests outside the venue of
the meeting and internal criticism. For the first time in UMNO’s history, the
assembly saw only the president, namely Najib himself, speak at the winding
up-session, a clear signal that Najib and his followers did not want to face
surprises from within the organization. Declaring himself a «magnanimous»
person, Najib Razak ended his speech at the general assembly by extending
a handshake to his most vociferous critic within the UMNO leadership,
Muhyiddin Yassin. Muhyiddin accepted Najib’s hand, «as delegates shouted
and applauded the apparent show of unity».61
55. ‘Malaysia’s scandal-hit PM faces no-confidence vote’, The Guardian, 19 Oc-

tober 2015.
56. ‘UMNO member files lawsuit against Malaysia PM Najib’, Channel News Asia,
29 August 2015.
57. Ida Lim, ‘Anina Saadudin: why I am suing Najib’, Malay Mail Online, 27
September 2015.
58. ‘Anina sacked from UMNO’, The Rakyat Post, 1 September 2015.
59. The UMNO Division Chiefs are the party’s leadership, whose members are
elected at a local level throughout Malaysia. According to an internal poll in October
2015, 154 Division Chiefs out of a total of 191 were strongly backing Najib and want-
ed stern actions taken against internal dissidents. See ‘154 Umno chiefs want action
on errant party leaders’ Malaysiakini, 30 October 2015.
60. ‘UMNO meets amid tensions over funding scandal’, Malaysiakini, 8 Decem-
ber 2015.
61. ‘Najib, Muhyiddin shake hands at close of UMNO General Assembly’, Ma-
laysian Insider, 12 December 2015.
224
Malaysia 2015
Apparently Najib won this round, restoring unity in the UMNO’s

ranks. But denying Muhyiddin Yassin the possibility of speaking can also
be seen as a signal of fear and of weakness. The next general elections were
scheduled for 2018, allowing Najib time both to retake full control over his
own party and to rebuild his public image. But that is an uphill task, which
could be made more difficult if new problems come up in the near future,
related to the investigations on Najib’s private accounts. More importantly,
it remains to be seen how Malaysian public opinion will react to a weakened
leadership. According to Ooi Kee Beng, Deputy Director of the Singapore-
based Iseas-Yusof Ishak Institute: «The only way UMNO can turn things
around for itself is with a new leader, a new agenda and a new direction in
leadership».62
7. A balancing act policy: Malaysia between the US and China
On 5 October 2015 the trade ministers of 12 countries announced

the final agreement for the Trans-Pacific Partnership (TPP) in Atlanta.
Although in order to be enforced the treaty still needed to be ratified by all
the parliaments, the 5 October agreement meant that the main step had
been taken.
The TPP has generally been considered a crucially important
element in the US strategy to counter China’s influence in the Asia-Pacific
region.63 Malaysia is pivotal in the enforcement of this strategy. A visit of
Barack Obama to Kuala Lumpur in November for the US-ASEAN meeting
highlighted once again Malaysia’s role as a US strategic partner in the
region. Signing the TPP was just one among many pro-US steps Malaysia,
traditionally an American ally, has taken in the recent past. After 2013, with
a series of agreements, Malaysian Prime Minister Najib Razak has steadily
conceded to the US whatever Washington has requested. Indeed Malaysia
has showed itself eager to meet US requirements by allowing the US Navy
to fly spy planes from Malaysian airstrips, by cooperating in joint military
exercises and by collaborating in countering the funding of international
terrorist organizations.64
On its side, the US was careful not to harm the Malaysian leadership
by drawing attention to some already present frictions. These were several,
and included: the jailing of the opposition leader Anwar Ibrahim (which
62. ‘UMNO meets amid tensions over funding scandal’, Malaysiakini, 8 Decem-
ber 2015.
63. With a reference to TPP, President Barack Obama stated: «When more than
95 percent of our potential customers live outside our borders, we can’t let countries
like China write the rules of the global economy». The White House, Office of the
Press Secretary, Statement by the President on Trans-Pacific Partnership, 5 October 2015.
64. Cheng-Chwee Kuik, ‘Malaysia’s Balancing Act’, New York Times, 7 December
2015.
225
Stefano Caldirola
attracted criticism of the Malaysian judicial system at the international level);

an alleged human rights crackdown just before Obama’s visit; the arbitrary
employment, in the wake of the 1MDB scandal, of criminal defamation and
internal security laws to prosecute dissent among journalists and opposition
activists. Obama, who was visiting Malaysia for the second time in just two
years and who was the first US president to visit the country in over half a
century, carefully avoided mentioning the troubles Najib was facing at home
and the issues of human rights and democracy more broadly.65
In the months before the TPP announcement, Malaysia was partially
involved in the dispute concerning the Spratly Islands in the South China
Sea, namely the same dispute which had already caused a worsening in
the relations between China and other ASEAN countries. Nevertheless,
Malaysia’s protests against China regarding the increasing Chinese military
presence in the disputed area were relatively cautious. Even though Malaysia
itself was involved in the dispute, in the past few years it has appeared to
act mostly to moderate other ASEAN members, such as Vietnam and the
Philippines, whose opposition to China’s assertiveness in the area was much
stronger. Something changed between March 2013 and February 2014
when Chinese warships held exercises twice in the waters near James Shoal,
an atoll 80 kilometres from the Borneo seashore, the control over which is a
point of dispute among Malaysia, China, and Taiwan. Kuala Lumpur reacted
with official protests to Beijing.66 In October 2013 Malaysia announced
plans to build a navy base in Bintulu (Sarawak state), the closest major town
to the contested atoll, stating that the aim of this base was to protect oil and
gas reserves in the region.67 However, according to Reuters’s analyst Stuart
Grundgings, «despite its shifting stance, Malaysia will likely stop short of
risking any chill in ties with China».68 He added: «Malaysia has given the
impression of seeing the South China Sea dispute as a hitch in an otherwise
thriving and historic relationship».69
After the diplomatic tensions between the two countries over the
handling of the flight MH 370 disaster cooled down,70 the Malaysian
government did its best to try to appease China, its main economic partner.
In October 2015 the two countries conducted the first-ever joint troop
exercises in the Strait of Malacca and, in November of the same year, the
65. Colleen McCain Nelson, ‘Obama Faces a Diplomatic Dilemma on Malaysia

Trip’, The Wall Street Journal, 19 November 2015.
flight MH 370’, Asia Maior 2014, p. 168.
67. Malaysian Defense Minister Hishammuddin Tun Hussein, press conference
reported on HIS Jane’s Information Group, 19 October 2013.
68. Stuart Grungings, ‘Insight – China’s assertiveness hardens Malaysian stance
in sea dispute’, Reuters, 26 February 2014.
69. Ibid.
flight MH 370’, pp. 160–168.
226
Malaysia 2015
Malaysian Government gave permission to Chinese warships patrolling the

South China Sea to stop at Malaysian ports.
After the bilateral talks held in Kuala Lumpur on 20 November, both
Najib and Obama admitted that the South China Sea problem had been one
of the main points of discussion. Obama underlined the involvement of all the
ASEAN countries in the dispute saying that «there are a number of claimants
there»71 and that «the United States is not one of them, but the United States
does strongly believe in the need to apply the rule of law and international
norms in the resolution of maritime disputes».72 However, Najib’s position
was decidedly much more cautious. The Malaysian Prime Minister carefully
avoided any mention not only of China, but of the other ASEAN countries
as well, in an attempt to de-emphasise the importance of the issue. In the
press conference after the meeting, Najib stated: «We know the position of the
United States, (inaudible) position consistent with the role. And we hope that
periodic tensions are not escalated, and that we be able to find a negotiated
settlement that’s consonant with the principle of international law and that
respects the rights of big and small nations, as well».73
This declaration did not mention other claimants to the waters and
islets of the South China Sea, in an attempt not to attract criticism from
either China or other ASEAN members. This was something that Kuala
Lumpur wanted to avoid at any cost, in order not to create additional
problems related to its chairmanship in a crucial year for regional economic
integration. As noted in March by the Foreign Minister of Malaysia: «As
chairman of ASEAN for 2015, Malaysia bears the responsibility to ensure
that the agenda to establish the ASEAN Community by the end of this year
will be materialized».74
Indeed, Malaysia was performing a kind of balancing act between
China and the US with an eye on the politics of regional integration,
which has been a cornerstone of Malaysian foreign policy for the last 30
years. Yet, ASEAN members are not in agreement about how to cope with
China. The four ASEAN member states that have maritime disputes with
China (Malaysia, the Philippines, Vietnam and Brunei) have overlapping
claims and each of them do not recognize the claims of their fellow ASEAN
countries with respect to the disputed islands. Furthermore, there are
evident contrasts within the organization about how to relate with China.
Often, states which have no direct role in the South China Sea disputes, such
as Myanmar, Cambodia and Indonesia, have tried to moderate the position
of the other ASEAN countries vis-à-vis China.75
71. The White House, Office of the Press Secretary, Remarks by President Obama
and Prime Minister Najib of Malaysia after bilateral meeting, 20 November, 2015.
72. Ibid.
73. Ibid.
74. Lin Hao & Zhao Bochao, ‘News Analysis: Challenges lie ahead for building
ASEAN Economic community’, Xinhua, 25 April 2015.
75. Murray Hiebert, Phuong Nguyen e Gregory B. Poling, Perspectives on the
227
Stefano Caldirola
On 4 November 2015 the ASEAN Defence Ministers Plus (ADMM-

Plus)76 had a meeting in Kuala Lumpur. For the first time the ADMM-Plus
did not issue a joint statement at the end of the meeting. It seems that
the final statement had been blocked by China over the issue of the South
China Sea.77 Officially, ASEAN deals with these disputes following the Six-
Point Principles, aiming at fully implementing the 2002 Declaration on the
Conduct of Parties in the South China Sea78 and the 2011 Guidelines for
the Implementation of the same Declaration.79 Nonetheless, it is clear that
many of the countries within the organization thought that these disputes
should be dealt with by each state separately and should be left out from the
debate within ASEAN.80
The Malaysian position on the issue seems to be a paradox. On the
one hand, Malaysia is a party in the South China Sea disputes and a strong
and long-time ally of the US, which is to say the nation that has been more
resolute in the last few years in reacting to China’s assertiveness in the area.
Hence, apparently, Malaysia has a visible interest in uniting as many ASEAN
countries as possible on a common anti-China platform. But, on the other
hand, China represents the most important market for Malaysian exports
and Malaysia is the largest Chinese economic partner among the ASEAN
countries. This creates an imperative for Najib’s Government not to harm
Malaysia’s relations with China. So, the Malaysian Prime Minister made
every possible effort not to involve ASEAN in the South China Sea dispute
at all.
South China Sea, A Report of the CSIS Sumitro Chair for Southeast Asian Studies, Centre
for Strategic and International Studies/New York: Rowman and Littlefield, 2014, pp.
1–5. Available on line at http://csis.org/files/publication/140930_Hiebert_Perspec-
tivesSouthChinaSea_Web.pdf.
76. The ASEAN Defence Ministers Plus (ADMM-Plus) includes the ten ASEAN
countries Defence Ministers, plus those of the US, China, Australia, New Zealand,
India, Japan, the Republic of Korea and Russia.
77. Chau Bao Nguyen, ‘ASEAN’s uncertain stance in the South China Sea’, East
Asia Forum, 25 November 2015.
78. CIL (Centre for International Law) documents database, National Univer-
sity of Singapore, 2002 Declaration on the conduct of the parties in the South China sea.
Adopted by the Foreign Ministers of ASEAN and the People’s Republic of China at the 8th
ASEAN Summit in Phnom Penh, Cambodia, 4 November 2002.
79. CIL (Centre for International Law) documents database, National Univer-
sity of Singapore, Guidelines for the Implementation of DOC 2011, pp. 3–4 (http://cil.
nus.edu.sg/wp/wp-content/uploads/2011/06/Documents-on-ASEAN-and-South-Chi-
na-Sea-as-of-June-2011.pdf).
80. Prashant Parameshwaran, ‘Does ASEAN have a South China Sea position?’,
The Diplomat, 26 March 2015.
228
thailand 2015: anxietY over the roYal succession
in the post coup 2014
Pavin Chachavalpongpun
Center for Southeast Asian Studies, Kyoto University

pavin@cseas.kyoto-u.ac.jp
The military staged a coup on 22 May 2014, overthrowing the elected government
of Prime Minister Yingluck Shinawatra. Outwardly, the military justified its political
intervention with the classic claim that corruption was the rot of Thai politics and
the coup was needed to purify the political domain. At a deeper level however, the
military intervened at a time when a critical transition in Thai politics is on the
horizon: the imminent royal succession. For decades, the traditional elites, of which
the military is a part, have long dominated Thai politics. This changed with the
arrival of the Shinawatras who set huge socio-economic changes in motion. They
then took advantage to empower themselves politically, and in doing so, shook the
old political structure. In today’s Thailand, the power struggle between elective and
non-elective institutions is now reaching its peak because the era of King Bhumibol
Adulyadej is closing. Haunted by anxiety over a future without the charismatic King,
the traditional elites are vying to manage the royal succession and maintain their
power position. The paper argues that the military government led by General Prayuth
Chan-ocha is seeking to accomplish three missions: to reconstruct the electoral system
that will benefit the traditional elites; to eliminate political enemies though the legal
system, particularly the lèse-majesté law and other non-legal means; and to reinforce
the position of the palace to ensure that the monarchy will continue to be at the centre
of power in the post-Bhumibol days. It is unlikely that these undertakings will stabilise
Thai politics, and as voters become alienated in the political process à la Prayuth,
large-scale violent protests may be seen as unavoidable in order to restore democracy.
1. Introduction
The Thai military staged the latest coup on 22 May 2014, overthrowing
the elected government of Prime Minister Yingluck Shinawatra, who won a
landslide election earlier in 2011. Months of relentless protests led by for-
mer members of parliament from the Democrat Party, Suthep Thaugsuban,
which formed an anti-Yingluck movement under the name, PDRC (People’s
Democratic Reform Council), successfully created a violent context for the mili-
tary to intervene. The discontentment against the government derived from
the fact that the ruling Pheu Thai Party attempted to push through the par-
liament a blanket amnesty bill, which, if successfully approved, could eman-
cipate former Prime Minister Thaksin Shinawatra from corruption char-

Pavin ChaChavalPongPun
ges.1 Although the blanket amnesty would also allow the military to walk
free from its involvement in the mass killings of the red-shirt protesters in
2010, the military top leaders seemed to be more interested in interfering
in politics as a way to eliminate the Shinawatras’ political influence. Prime
Minister Yingluck called for dissolution of the parliament and an election
was held on 2 February 2014. But the Constitutional Court intervened and
ordered her to step down over her role in the controversial transfer of a
senior security officer in 2011.2 In May 2014, the military finally staged a
coup, while leading many Thais to believe that it was just another «normal
coup», primarily to get rid of so-called corrupt politicians.
In reality, the objective of this latest coup went beyond the mere
overthrowing of the Yingluck government. The electoral successes of
Thaksin’s political parties, from the Thai Rak Thai [Thais Love Thais] in
2001, the Palang Prachachon [People’s Power Party] in 2007 to the Pheu
Thai [For Thais] in 2011, serve as a justification for the royalist elites to
find ways to constrain majoritarian democracy. Andrew Walker asserted
that they wished to condemn Thailand’s new «electocracy» championed by
Thaksin and his proxies.3 This is particularly crucial during which time the
royal succession is imminent. This article argues that the coup was staged
primarily for the military and the traditional elites to take control of the
royal transition. In so doing, they aimed at eliminating the Shinawatras
before the succession takes place. In this process, it seems apparent that the
military has attempted to stay in power for as long as possible, determined,
once again, to be in charge of the royal succession. Should the military be
forced to step down, perhaps due to domestic or international pressure, it
wants to ensure that it would continue to dominate the political domain.
During 2014 and 2015, Thailand witnessed military scheming to put in
place an infrastructure, to allow itself and the royalist elites to manipulate
the electoral game, which in the past decade had been comfortably con-
trolled by the Thaksin faction. Alongside, the military has constructed and
popularised the discourse of anti-majoritarian democracy, first crafted by
the anti-Thaksin «yellow-shirt» movement, known as the People’s Alliance for
Democracy (PAD), and now the PDRC; it is adopted by the current military-
appointed Constitution Drafting Committee in order to belittle the «elec-
tocracy» as a way to prevent the Thaksin faction from returning to politics
too easily.
The military government of a self-proclaimed Prime Minister, Gene-
ral Prayuh Chan-ocha is now concentrating on drafting the constitution,
which is seen as part of the traditional elites putting such an infrastructure
1. Samuel Issacharoff, Fragile Democracies: Contested Power in the Era of Constitu-

tional Courts, New York: Cambridge University Press, 2015, p. 266.
2. ‘Yingluck, 9 Ministers Removed from Office’, Bangkok Post, 7 May 2014.
3. Andrew Walker, Thailand’s Political Peasants: Power in the Modern Rural Econo-
my, Wisconsin and London: The University of Wisconsin Press, 2012, p. 23.
230
Thailand 2015
in place. Instead of working to win the electorate by introducing popular

and positive policies, the royalist elites have chosen to control the electoral
system through rewriting the constitution. Almost two years now after the
coup, key figures in this military government have revealed their ideas for
the new constitution, which will be similar to the semi-democracy model
that was seen in Thailand a few decades ago – a model that seemed to
embrace democracy on the exterior but essentially the government was
under control of extra-constitutional institutions. However, an earlier
version of the drafted constitution was disapproved by the military-do-
minated parliament, possibly as a result of a split in the ideas among the
parliamentarians. Some seemed to be keen for the elections to be organi-
sed soon, so that Thailand would eventually get out of the political mess.
Meanwhile, some wanted to prolong the life of the Thai military junta
and therefore rejecting the constitution would be a way for the military
government to stay on in power. Currently, a new set of the Constitutional
Drafting Committee, led by Meechai Ruchupan, a legal expert and former
politician with intimate ties with the military, is working on redrafting
the charter. The structure of the new constitution that is being discussed,
when implemented, will certainly prevent an emergence of a strong and
popular elected government, as will be shown/demonstrated in the next
paragraphs. It is also likely that the appointed Senate will be the agent of
the conservative elites and will play a vital role in that capacity. Moreover,
the new constitution will provide the military with some legitimacy to in-
tervene in politics whenever it sees fit. Even if the junta goes ahead with
the elections, now set for 2017, the top brass will continue to exert major
influence over Thai politics – a strategy necessary in coping with the un-
certainties in the post-King Bhumibol Adulyadej period.
2. New political structure
Political Scientist Puangthong Pawakapan of Chulalongkorn Universi-

ty wrote succinctly:
Thailand’s pro-coup entrenched royalists distrust electoral democracy,
politicians and rural-voters. The anti-rural voter discourse was in fact
central to the Yellow-Shirt campaigns led by the People’s Democratic Re-
form Council (PDRC) and its predecessor the People’s Alliance for Demo-
cracy. The coup is an opportunity for them to put construct [sic] a new
political game where the electoral power of majority voters is reduced.4
4. Puangthong Pawakapan, ‘The Thai Junta’s Interim Constitution: Towards

an Anti-Electoral Democracy’, ISEAS Perspective, No 45, 12 August 2014 (http://www.
iseas.edu.sg/documents/publication/ISEAS_Perspective_2014_45.pdf) accessed 15
December 2015, p. 4
231
And indeed, the Prayuth government has striven to promote a new

political structure whereby future civilian governments would be deprived
of their actual power. In the first draft of the constitution, it was evident that
the members of the Constitutional Drafting Committee moved toward that
end to limit the power of the future executive branch by allowing a non-
elected member of parliament to become prime minister. In other words,
the new constitution would not require a prime minister to be a member of
parliament or a member of any political party. Purportedly, this would allow
an «outsider», like those from the military, to take the premiership – a move
perceived to be a step backward for Thai political development. According
to the 1997 constitution, still known to be the most «liberal» constitution
Thailand ever had, it was stipulated clearly that a prime minister must be an
elected member of parliament. This requirement reflected one of the major
demands of the democratic movement in the aftermath of the Black May
incident of 1992 as part of the public’s push for a greater democratisation
and as a way to prevent the military from its interference in politics.5
Puangthong also emphasised that the new constitution will likely
grant the Senate more power. Senators are to be assigned greater responsi-
bilities, such as in proposing reform bills and even scrutinising the profiles
of nominated cabinet ministers before the prime minister submits the list
for royal approval. Moreover, senators could be given some authority to
vet the profiles of heads of all governmental organisations. In effect, the
Senate will be a dutiful agent of the conservative powers in their attempt
to control the new political structure. The set-up of the Senate proposed by
the Constitutional Drafting Committee reiterated the conservative elite’s
determination to consolidate their power over parliamentary politics.6 The
move to constrain the parliamentary politics has been noticed since the
coup of 2006, which was primarily staged to topple the Thaksin regime and
its enduring power. At the peak of Thai democratisation in the 1990s, as
reflected in the 1997 constitution, all senators must be directly elected by
the people. Seen as an important instrument of the traditional elites, the
Senate underwent a serious transformation to serve the political purpo-
ses of those elites. In 2007, as the new constitution was drawn, the Senate
was divided into two parts – some members were elected, some appointed.
This model of a partial election of the Senate will lend itself to the latest
constitution drafted by the Prayuth regime. But the empowerment of the
5. The 1992 Black May incident is referred to a clash between a pro-democracy

movement and the military government of General Suchinda Kraprayoon, who took
power and declared himself as prime minister. The protesters roamed the streets of
Bangkok calling for Suchinda to step down. In response, the Suchinda government
ordered the killing of the protesters, leading to 52 deaths and hundreds injured.
6. Puangthong Pawakapan, ‘Will Thailand’s New Constitution be a Return to
Authoritarianism’, ISEAS Perspective, No 3, 27 January 2015, p. 5 (http://www.iseas.
edu.sg/images/pdf/ISEAS_Perspective_2015_3.pdf) accessed 15 December 2015.
232
Thailand 2015
Senate will not be the only tactic adopted by the Thai junta. It is also possi-
ble that the Constitutional Drafting Committee would permit independent
candidates to run for seats in the parliament. The emergence of a large
number of independent candidates would function to break up the par-
liamentary domination of powerful political parties, like that of Thaksin.
The end result could see the forming of small or medium sized parties
together with some independent members of parliament – a recipe for a
coalition government seen vividly during the 1980s and 1990s. Coalition
governments are usually weak, as they consist of several individuals with di-
verse interests; they would thus be easily manipulated from the perspective
of the traditional elites. Apart from the encouragement for independent
members of parliament, it is highly likely that the constitution would give
more power to independent organisations – most of which are not really
independent but operate at the behest of the traditional elites. These orga-
nisations include the National Anti-Corruption Commission, the Human
Rights Commission and the Constitutional Court. They successfully proved
in the past to have worked to weaken the government of Yingluck. For
example, the Constitutional Court was responsible for undermining th-
ree prime ministers in the Thaksin camp, from Samak Sundaravej (2008),
Somchai Wongsawat (2008), to Yingluck (2014).7 This is testament of how
independent institutions, like the Constitutional Court, have become lar-
gely politicised.
From this view, the new constitution and the election that will follow
will not solve the Thai crisis, which was brought about by the elites’ attempt
to maintain their power position in the first place. The election, in particu-
lar, will not guarantee that Thailand’s democracy will return and be streng-
thened. At the critical period of the royal transition, the control of the mi-
litary over the parliamentary process will further complicate Thai politics.
3. The military–monarchy nexus
Realising that the military will continue to exert its influence in poli-
tics through the carefully designed constitution, it is imperative to explore
the role of the army, now and in the post-election period. It should not be
unexpected for Thailand to have a senior/retired military leader as a prime
7. As an attempt to remove Thaksin’s proxies from power, the Constitutional

Court ordered Samak, in 2008, to step down on the charge of conflict of interests,
since he was also working as a television chief while serving as Prime Minister. Shortly
after, the Court employed to same tactic to overthrow Somchai Wongsawat, a prime
minister and also brother-in-law of Thaksin, because one of the executive members
of his party, the PPP, was accused of committing electoral fraud. In 2014, Yingluck
was also forced to leave office on the grounds that she transferred a senior security
official unfairly.
233
minister after the next election, since the new constitution would likely allow
a non-member of parliament to take up the top political position. It is not
unexpected either for the National Council for Peace and Order (NCPO)
– the governing body of the coup makers – to continue to exist and Article
44, known as the «dictator law», which gives the prime minister unchecked
authority over all branches of government, to remain in place after the elec-
tion.8 Re-establishing military power in politics is essential for the future
of the monarchy, as much as for the military itself. This is simply because
the intervention in politics of the army has long been carried out under
the pretext of the military’s need to defend the monarchy from all kinds of
threats. From communism in the old days to modern-day anti-monarchism
supposedly driven by Thaksin’s supporters, the military has exploited the
position of the monarchy to give itself legitimacy in playing politics. As this
paper argues, the 2014 coup was staged in order for the traditional elites to
oversee the royal succession, the military has, in this process, assigned itself
a task of eliminating threats and enemies. But why is the royal succession so
crucial for the traditional elites?
King Bhumibol Adulyadej is today the world’s longest reigning mon-
arch. Crowned in 1946, Bhumibol was able to transform the monarchy from
an unpopular establishment into the country’s most powerful institution.
But his era is coming to a close. He is frail and has been intermittently
hospitalised since 2009. He did not appear on national television on his
birthday, 5 December 2015, to give his much-awaited speech, thus height-
ening the public anxiety over the future of Thailand without the charismatic
king. Andrew MacGregor Marshall even predicted that while it is highly
possible that violence will erupt in the days and weeks after Bhumibol dies,
it is likely to lead to a period of greater stability.9 Ironically, the anxiety is
derived mainly from Bhumibol’s successful reign. In the past several dec-
ades, royal elites and the military embarked on recreating the authoritative
persona of Bhumibol to strengthen the monarchy. They elevated the king
to a semi-god status, while simultaneously celebrating his reputation as the
people-centric monarch. Pictures of the king travelling through remote re-
gions, with maps, notebooks, and binoculars in his hands, were popularised.
He initiated a series of royal projects to inmprove the living standards of
the underprivileged. The trickle of sweat from the royal brow captivatingly
symbolised a hardworking monarch. Bhumibol was also extolled as a demo-
cratic king. His periodic interventions in politics – most recently in 1992
and 2006 – were interpreted as a necessary step to prevent or end politi-
cal violence. This kind of interpretation provided a legitimate pretext for
8. ‘Thai PM’s Plan to Lift Martial Law with «Dictator» Ruling Sparks Concerns’,
The Guardian, 31 March 2015.
9. Andrew MacGregor Marshall, A Kingdom in Crisis, London: Zed Books, 2014,
p. 215.
234
Thailand 2015
his political involvement against the constitutional rule of the king being
«above politics». Thai historian Thongchai Winichakul asserted:
The more it [monarchy] is believed to be outside politics, the higher
moral authority thus more influence it earns because, in the logic of
Dhammaracha, non-partisan and disengagement means cleaner and
more virtuous, hence more power, which does not corrupt. Over time,
people look «up» to the royal authority when they are dissatisfied with
the normal political system.10
But the royal transition is happening and far from being a trouble-free
process. The construction of a perfect Bhumibol will prove to be a dange-
rous entrapment for the only heir apparent, Crown Prince Maha Vajira-
longkorn. Vajiralongkorn is an opposite image of his father. The inability
of Vajiralongkorn to fit into that perfect mould crafted by the palace trig-
gers public anxiety regarding Thailand under his future reign. Unfortuna-
tely, palace propaganda based around excessive glorification of Bhumibol
through national education and the mainstream media has been in recent
years more aggravated. This led to a rigid perception of an immacula-
te monarch – anything less than this will not be accepted. Certainly, this
poses a serious challenge for Vajiralongkorn to follow in the footsteps of
his father. Matching Bhumibol’s divinity, popularity and shrewd political
manoeuvrings represents a formidable obstacle for Vajiralongkorn. These
are non-transferable traits and personal properties. The circumstances sur-
rounding the royal transition offer few choices for Vajiralongkorn – one of
which is to promote the reform of the monarchy should he wish to prolong
his reign. With his lack of sacredness and popularity, Vajiralongkorn – who
also lacks the necessary qualities to reign – may find expedient to detach
himself from politics. Depoliticising the monarchy is a crucial approach for
the survival of throne.
But Vajiralongkorn’s recent political interventions suggest otherwise.
As a part of his search for a new role in the period leading up to the royal
succession, Vajiralongkorn expressed concern about the potential political
violence during the anti-Yingluck Shinawatra government protests last year.
He summoned the Prime Minister, Yingluck, and the leader of the PDRC,
Suthep, for a televised royal audience. Andrew Walker wrote:
Given the gravity of the situation he adopts a stern and disapproving
tone. With the two protagonists kneeling before him, he emphasizes
the dangers of national division and the importance of resolving diffe-
rences through dialogue and democratic process rather than confron-
10. Thongchai Winichakul, ‘The Monarchy and Anti-Monarchy: Two Elephants

in the Room of Thai Politics and the State of Denial’, in Pavin Chachavalpongpun
(ed.), «Good Coup» Gone Bad: Thailand’s Political Development’s Since Thaksin’s Downfall,
Singapore: Institute of Southeast Asian Studies, 2014, p. 89.
235
tation on the street. He urges Suthep to end his protests and firmly
demands that the king’s role not be invoked in campaigns against a
democratically elected government. To display his even-handedness
he also reprimands Yingluck, encouraging her to deal respectfully with
the constitution and avoid unnecessary provocation of opposition for-
ces. Possibly a defining moment?11
However, talks about a political alliance between Vajiralongkorn and
the Thaksin camp, as a result of the former being isolated from the inner
circle of the palace, deepened a suspicion of the Crown Prince becoming
more sympathetic toward the Yingluck government. That suspicion served
as a factor behind a decision of the PDRC to ignore Vajiralongkorn’s plea
for the conflict to end. The test of his leadership was thrown into jeopardy.
The role of the military is traditionally crucial in the support of the
monarchy. Vajiralongkorn had long been isolated by the military although
he holds many top ranks in the army. To empower his position, Vajira-
longkorn set up his own praetorian army – the Royal Guard 904 Corps,
or Ratchawallop, an infantry regiment under his command since 1978. In
April 2014, a month before the coup, Vajiralongkorn announced a new re-
cruitment to his army, hoping to attract those in Thailand’s rural north
and northeast regions – the heartland of the Shinawatra clan. However, the
Ratchawallop unit, now consisting of 5,600 members, has been unpopular,
partly because it was seen as hostile to the national army.12 Without sup-
port from the military and the palace, Vajiralongkorn, as mentioned earlier,
viewed his alliance with Thaksin as strategic. Since Thaksin commanded
a popular mandate through successive electoral triumphs, leaning toward
Thaksin could mean gaining that same popular support. The evidence was
reflected in the gradually growing admiration of Vajiralongkorn among the
red-shirt supporters of Thaksin. But the 2014 coup has compelled Vajira-
longkorn to shift his political alliance. He seemed to have reached out to
the military government of Prime Minister Prayuth to ensure its endorse-
ment of his succession. For example, Vajiralongkorn agreed to preside over
the inauguration ceremony of the National Legislative Assembly (NLA) in
August 2014, an act deemed to legitimise the coup and the military regime.
On that occasion, Vajiralongkorn urged members of the NLA to bring Thai-
land back on a stable track.13 So far, Vajiralongkorn has never publicly con-
demned the coup. Vajiralongkorn also divorced his wife, Princess Srirasmi,
reasoning that her relatives had done some damage to the dignity of the
11. Andrew Walker, ‘A Royal Intervention?’, New Mandala, 27 November 2013

(http://asiapacific.anu.edu.au/newmandala/2013/11/27/a-royal-intervention) accessed
16 December 2015.
12. In an email interview with Paul Chambers, Director of Research at the Insti-
tute of Southeast Asian Affairs, Chiang Mai University, 21 January 2015.
13. ‘National Legislative Assembly Opened’, Bangkok Post, 7 August 2014, ac-
cessed 16 December 2015.
236
Thailand 2015
monarchy. They were accused of exploiting his name for their own financial
benefits, and were charged of lèse-majesté.14 They were eventually jailed for
two and a half years after pleading guilty to defaming the monarchy. His
move was seen as a cleaning-the-house exercise before the succession. But
were Vajiralongkorn’s efforts enough to earn the support of the royal and
military elites?
Talks are ripe about an alternative to Vajiralongkorn should his lack of
required qualities threaten the stability of the royal institution. His popular
sister, Princess Maha Chakri Sirindhorn, has long been recognised as a more
suitable candidate to the throne following her own successful makeover as
a humble and down-to-earth princess à la Bhumibol. But a hurdle is how
to overcome the constitutional constraint of prioritising male heirs over fe-
male candidates. A greater problem will rest on possible fallout within the
royal family. As an heir apparent, it is unlikely that Vajiralongkorn will walk
away quietly from his legitimate kingship. The selection of Sirindhorn over
Vajiralongkorn will instigate a power struggle in the palace, thus deepening
the vulnerable position of the monarchy at the twilight of the Bhumibol pe-
riod. The implications of the royal succession, shown through the military’s
seizure of political power, the politicisation of the monarchy and the power
rearrangements within the palace, reaffirm the importance of the royal in-
stitution as an integral part of Thai politics. The real stake lies at the vision
of the next monarch – whoever it will be – to ensure that the monarchy is
compatible with democracy.
4. A fragmented army?
As the royal transition has remained uncertain, the seemingly frag-

mented military may further complicate the succession. A rift is growing
within Thailand’s military-royalist establishment, threatening the country’s
stability and undermining prospects that the upcoming royal succession will
unfold smoothly. On one side is an old guard of senior officers who gra-
dually consolidated power during the long reign of Bhumibol. On the other
is a new guard from a semi-autonomous elite military unit at the service
of Queen Sirikit, which includes the leaders of the 2014 coup against the
elected Yingluck government. The current Prime Minister, Prayuth, is a for-
mer commander of the 21st Infantry regiment, better known as the Queen’s
Guard. Founded in 1950 to fight in the Korean War, it was later assigned
to protect Sirikit. After rising to eminence within the regiment, in recent
14. Lèse-majesté, or the crime of injury to royalty, is defined by Article 112 of

the Thai Criminal Code, which states that defamatory, insulting or threatening com-
ments about the king, queen and regent are punishable by three to fifteen years in
prison.
237
years Prayuth has sought to increase his political power, and now seems
to challenge other military-royalist factions. It is known that the army has
been an indispensable actor in Thai politics for decades, thanks largely to
its close connection with the monarchy. Together the military and the royal
family have worked to keep civilian governments weak in order to maintain
more power themselves. During the Cold War, they joined forces to ward
off Communist influence. Their alliance was reinforced in the 1980s, after
Bhumibol appointed Prem Tinsulanonda, a general, to be prime minister.
With that nomination, Prem became the head of what the political scientist
Duncan McCargo has called the «network monarchy»: a political consortium
of pro-monarchy groups that includes the military, conservative royalists,
senior bureaucrats and big business.15
Prem stepped down in 1988, largely because of infighting within his
government, but he remained influential behind the scenes. Notably, he
advised Bhumibol during the turbulent period of 1991–92. After General
Suchinda Kraprayoon, a member of the junta then in power, reneged on a
promise not to become prime minister, there were pro-democracy protests,
and then the military killed some demonstrators. Bhumibol stepped in, cal-
ling for a truce while keeping his distance from the army, and earning a
reputation as a stabilising force and for being neutral. In 1998, Bhumibol
appointed Prem to preside over the Privy Council, an advisory body that
protects the monarchy’s interests and promotes its views. By that time, non-
elected institutions like the Privy Council and the courts were exerting more
and more influence in Thai politics. The power of Prem and his supporters
in the network monarchy continued to grow until 2001. That year, Thaksin
won the election by a landslide, thanks to a populist platform vowing to
reduce rural poverty. Tensions between elected and non-elected institutions
became an open conflict, as Thaksin threatened to recast the political lan-
dscape and challenge the domination of the monarchy and the military. He
was ousted in 2006 in a coup widely believed to have been masterminded by
Prem. Apparently, Prem has denied this.16
Thaksin was not the only loser, however. Soon the Prem faction found
itself weakened by the emergence of an anti-coup movement, the so-called
red-shirts, as well as anti-monarchist sentiment, which was growing as Bhu-
15. Duncan McCargo proposed that Thai politics is best understood in terms of
political networks. The predominant network of the period 1973–2001 was centred
on the palace, and is termed «network monarchy» which involved active interventions
in the political process by Bhumibol and his proxies, notably former Prime Minister
and current President of the Privy Council Prem Tinsulanond, together with groups
of traditional elite and powerful businesses. See, Duncan McCargo, ‘Network Mon-
archy and Legitimacy Crises in Thailand’, The Pacific Review 18, 4 December 2005,
p. 499.
16. Panya Thiewsangwan, ‘Prem Denies any Involvement in Sept 2006 Coup’,
The Nation, 28 March 2008 (http://www.nationmultimedia.com/2008/03/28/politics/
politics_30069401.php) accessed 10 February 2016.
238
Thailand 2015
mibol’s health deteriorated. Queen Sirikit, meanwhile, was becoming more

politically active, partly to compensate for Bhumibol’s fading authority. Siri-
kit’s position has been reinforced in recent years with the promotion of men
from the Queen’s Guard to key positions in the army. Prayuth was deputy
army chief in May 2010 when the army cracked down on red-shirt protesters
in Bangkok’s business district; a few months later, he became army chief.
Most leaders of the 2014 coup are members of the Queen’s Guard.
Although Sirikit suffered a severe stroke in 2012, her loyalists re-
main powerful, and now seem ready to influence the royal succession. The
Prayuth government apparently supports Crown Prince Maha Vajiralon-
gkorn, whom Bhumibol designated as his heir apparent in 1972. Vajiralon-
gkorn, for his part, seems to have endorsed Prayuth’s coup, as seen through
his speech delivered at the inaugural session of the NLA in August 2014.
The main reason was the fact that the Prince came to the realisation that to
become the next king without support from the army would be difficult, if
not impossible.
But the old guard within the network monarchy finds Vajiralongkorn
lacking in gravitas. According to a 2010 U.S. diplomatic cable released by
Wikileaks, Prem, the Privy Councillor Siddhi Savetsila and former Prime
Minister Anand Panyarachun expressed misgivings to the U.S. ambassador
to Thailand about the prince becoming king. A note by the ambassador
says Siddhi and Anand «implied the country would be better off if other ar-
rangements could be made».17 Siddhi suggested that Vajiralongkorn’s sister
Princess Sirindhorn, who is well liked by the public, be made heir apparent
instead.
Conservative royalists have also become increasingly critical of the
military government. Prem told the media in January, «This country does
not belong to Prayuth».18 Anand recently declared in public that General
Prayuth should «not to extend his rule too long».19 Rumours of a counter-
coup are growing louder in Bangkok. Prayuth has responded by placing
more members of the Queen’s Guard in major positions and has repor-
tedly been orchestrating military promotions without consulting the Privy
Council, even though it traditionally has had a say in important military
appointments. However, Prem is not yet out of the picture. When Bhumibol
17. ‘Thailand: Ambassador Engages Privy Council Chair Prem, Other «Estab-
lishment» Figures on Year Ahead’, Wikileaks, 25 January 2010.
18. ‘Khamtokham Pah Prem Yam Pratednee Maichaipenkhong Khun Prayuth
Won Yahployhai Baanmuangbadmang Ruamha Kohyuti’ (Words by words, Prem em-
phasizes this country does not belong to Prayuth. Do not let our country fall further
into the conflict. We must find an end to it), Manager Online, 29 January 2015 (http://
www.manager.co.th/Politics/ViewNews.aspx?NewsID=9580000011606) accessed 16
December 2015.
19. ‘Anand Tuan Big Tuu Yahyooyao’, (Anand warns Prayuth, Do not extend
his rule), Post Today, 16 June 2015 (http://www.posttoday.com/politic/371046) accessed
16 December 2015.
239
passes, it will be up to the Privy Council to formally recommend the heir

apparent to parliament for approval and then appointment to the thro-
ne. At that point it could nominate Sirindhorn instead of Vajiralongkorn.
Even if it did endorse the prince, simply delaying that decision by a day
would do great damage to his legitimacy as king. Fragmentation within the
military-royalist complex is complicating the upcoming royal succession in
Thailand. With the factions of Prayuth and Prem apparently favouring dif-
ferent candidates to the throne, the two men’s struggle could translate into
power plays within the government, the army and the palace itself. And
should the camp of the Queen’s Guard prevail and Vajiralongkorn accede
to the throne, both the military and the monarchy would become even more
politicised. This means that Thailand could become even less democratic.
The coup of 2014 was staged to ensure that the power holders will get to
manage the royal succession and to ensure that their political interests will
be preserved at all cost.
5. Thailand in the region
The coup of 2014 caused a considerable impact on the Thai economy

with exports and domestic consumption still lacking strength. Although the
military government initiated a 360-billion-baht stimulus package in Octo-
ber 2015, it failed to boost local economy mainly because of the lack of con-
fidence in the military and the general fear that the junta would stay longer
in politics. The fact that the first draft of the constitution was not approved,
thus allowing the military to extend the election deadline, was a testimony
to the junta wishing to remain in power. This led to a state of economic
inertia in Thailand. Meanwhile, the hope that foreign investors, like those
in China, would offer something more substantial, such as through a joint
long-distance rail project, continued to remain unrealistic. As a result, the
government was unable to raise the level of domestic demand.20
In the area of foreign relations, Thailand under military rule imple-
mented a foreign policy that sought to find the country’s new legitimacy
providers in the region in order to legitimise its regime. Thailand reached
out to China, Myanmar and Cambodia to seek their support for the existen-
ce of the military government. The visits of Prime Minister Prayuth to Nay
Pyi Taw and Phnom Penh in 2014 were politically meaningful because they
renewed Thailand’s friendship with old enemies in the region. More impor-
tantly, it was strategic for Thailand to strengthen its ties with two neighbours
which are also members of the Association of Southeast Asian Nations (ASE-
20. Tamaki Kyozuka, ‘Thai Economy Slow to Recover after Political Crisis’,
Nikkei Asian Review, 17 February 2015 (http://asia.nikkei.com/Politics-Economy/Econ-
omy/Thai-economy-slow-to-recover-after-political-crisis) accessed 10 February 2016.
240
Thailand 2015
AN). In other words, while ASEAN might have mixed responses to the coup
in Thailand, and often been criticised by the international community for
tolerating the Thai coup, the Thai government strove to informally set up a
mini-club of dictatorship endorsed by both Myanmar and Cambodia. Here,
China also played an important part in giving the Thai military regime a
source of confidence. The Prayuth government attempted to diversify its
foreign policy choices, and thus moved closer into the orbit of China at a
time when Thailand has been under sanctions from the West, particularly
from the United States.21 This new balance of power, with China acting as a
new regional hegemon working to challenge the old power like the United
States, allowed the military government in Thailand to hold on to its anti-
democratic agenda. It is a negative sign for the future of Thailand.
The United States, arguably Thailand’s most important ally, implemen-
ted an «interventionist policy» shortly after the coup by suspending US$4.7
million in financial assistance to the Thai army. Washington also excluded
Thailand from an international maritime exercise held in June 2014, and
downgraded Thailand’s Cobra Gold event, the largest annual military exer-
cise in the Asia Pacific region. Other democratic nations and organisations
took tougher action against the junta. The European Union, for example,
froze bilateral cooperation, suspended all official visits to and from Thai-
land, halted the implementation of a broad partnership and cooperation
agreement, and shelved talks on a trade deal. As mentioned earlier, amid
these punitive measures, the junta found some comfort in Chinese frien-
dship. Shortly after the coup, Prime Minister Prayuth was photographed
shaking hands with Chinese businessmen, illustrating the government’s
apparent belief that China could be used to offset the impact of Western
sanctions. So far, China has responded favourably to the Thai approaches.
Presenting itself as impartial in Thailand’s internal conflicts, China makes
no pretence of promoting human rights or democracy. This firm posture
is helpful to the junta, which knows that China will not promote internal
dissent by seeking political reforms.
Thailand and China established diplomatic relations in 1975. Throu-
ghout the latter half of the Cold War, the two countries formed a loose mi-
litary alignment against the communists in Indochina. Since then, bilateral
relations have remained healthy thanks to the absence of territorial dispu-
tes, firm ties between the Thai royal family and the Chinese leadership, and
the influence of Thailand’s well-integrated ethnic Chinese community. A
Sino-Thai trade agreement, the first between China and a member of the
ten-country ASEAN, took effect on 1 October 2003. Thailand has since then
developed a military relationship with China that is beginning to resemble
its security ties with the United States. Since the early 1980s, Bangkok has
21. Pavin Chachavalpongpun, ‘The Politics of International Sanctions: The

2014 Coup in Thailand’, Journal of International Affairs, Vol. 68, No.1, Fall/Winter
2014, pp. 173-76.
241
purchased American armaments and military-related equipment under this

partnership at «friendship prices». Sino-Thai military links, meanwhile, are
among the most developed in the region – second only to those of Myanmar,
China’s quasi-ally. Many cabinet ministers and powerful businesses in Thai-
land have significant investments in China. Thailand’s Charoen Pokphand
Group, one of Southeast Asia’s largest companies, has been doing business
in China since 1949. Thai and Chinese conglomerates regularly exchan-
ge high-level visits and share business information. Increasing numbers of
Thai students are learning Mandarin, prompting Beijing to dispatch a large
number of language teachers to Thailand.
Overall, US interventionism seems to have pushed Thailand further
into the Chinese sphere of influence. China’s non-interference policy and
its concentration on making money rather than enemies has helped it steal
a march on Western countries in the wake of the coup, allowing it to pull
ahead in the subtle but intensifying competition for increased influence in
Thailand. As a result, China was invited to invest in Thailand’s high-speed
train and other infrastructure projects, although amid intense lobbying
from Japanese and other companies, the projects have since become so-
mething of a political football ground. China’s pragmatism has also proven
effective in cementing its relations with Cambodia, Laos and Myanmar.
The United States, meanwhile, continues to goad the Thai leadership
with interventionist comments. In January 2015, US Assistant Secretary of
State Daniel Russel visited Thailand and urged the military government to
lift martial law and to return power to the Thai people. Russel’s remarks in-
furiated the generals, who see the US focus on democracy and human rights
as a departure from Washington’s Cold War support for the military, the
bureaucracy and the royal family as allies against communism. However, the
United States clearly understands that this alliance has weakened following
changes in the Thai political landscape in recent years. Washington has re-
cognised that there are new players in Thai politics who are not aligned with
the traditional elite, and has diversified its policy accordingly, reaching out
to the so-called «red-shirt» supporters of Yingluck and her brother Thaksin,
also a former prime minister. In effect, the United States is betting that its
interventionist stance in favour of democracy will be a better long-term bet
in Thailand than Beijing’s pragmatic support of the militarised status quo.
This is a high-stakes game for both Washington, which risks «losing
Thailand» to China, and Bangkok, which may in the end find that life as a
client of Beijing is both less comfortable and less effective than its alliance
with the United States. For example, there are question marks over whe-
ther China can provide the international legitimacy that the US has given
Thailand; whether it can guarantee Thailand’s security; and whether it can
sustain the appearance of neutrality in the Thai conflict while doing busi-
ness with the military government. In a broader context, a closer Sino-Thai
relationship may also affect regional stability, especially if it encourages the
242
Thailand 2015
formation of an alliance of non-democratic regimes, which would represent

a dark hole at the heart of Southeast Asia. Worse, Chinese support for the
Thai junta may strengthen its position and instil a degree of confidence that
could prolong its rule despite international condemnation. That would be
both a perverse outcome of Western interventionism and a tragedy for Thai-
land. The upcoming royal succession with a shift in the political dynamism
in Thailand may further intensify the rivalry between China and the United
States in their attempt to retain their political footholds in the country.
6. Conclusion
The traditional elites, of which the military is a part, often resort to

their old trick in undermining the threats against their interests – through a
military coup. The 2014 coup achieved that purpose, on the surface at least
– in eliminating the threat of Thaksin and his political proxies. However,
at this critical juncture of Thai politics, with the royal transition coming up,
the military has become even more anxious in re-organising political power,
to ensure that those interests of the monarchy and the military itself would
be defended. So far, the Prayuth government has seemed to reach out to the
heir apparent, Crown Prince Vajiralongkorn. Meanwhile, the Crown Prince
himself has become increasingly politically active, based on his numerous
public activities as well as his apparent endorsement of the use of lèse-maje-
sté to protect his name. But the involvement in politics of the Crown Prince
does not seem to guarantee that the monarchy is willing to depart from
political affairs even when in reality he lacks the necessary qualities enjoyed
by his more charismatic leaders. The fact that the new monarch is interested
in collaborating with the military will not help improve the Thai situation.
The power re-arrangement in the hands of the military and royal elites,
without a broader involvement of the Thai public, could stir up a sense of
resentment among Thais. This could lead to inevitable political clashes in
the post-Bhumibol era. The likely pessimistic scenario emerging from the
royal succession will cause an impact on the region, particularly in the con-
text of the competition between the United States and China to maintain
their influence in Thailand and generally in Southeast Asia.
243
caMbodia 2015: 30 Years oF hun sen’s governMent and
the progressive centralization oF power
Nicola Mocci
University of Sassari
nicolamocci@yahoo.it
In 2015 Cambodia celebrated the anniversary of 30 years of Hun Sen’s government.

This article argues that this anniversary coincided with a crisis of hegemony of both
the leadership and the Hun Sen’s government. During 2015 Hun Sen tempted to
face the crisis without a precise strategy. The most important was the so called «culture
of dialogue» with the opposition coalition and its leader Sam Rainsy. In a first stage
this dialogue was unexpectedly fruitful, but after a few months was interrupted and
the two parties plunged in the traditional clash.
In terms of international relations, the Cambodian government has further
strengthened its relations with China. The solid relationships with Beijing have
allowed Phnom Penh an approach more assertive in respect of Vietnam and of others
ASEAN members.
1. Introduction
It is universally acknowledged that every anniversary is an opportunity

to take stock and reflect on the past. For Cambodia, 2015 marked 30 years
of Prime Minister Hun Sen’s government, 40 years since the beginning of
the Pol Pot regime and 60 years since the Conference of Bandung.
The local and international press were most interested in the 30-year
anniversary of Hun Sen’s government. In fact, Hun Sen is one of the most
enduring prime ministers in the world and, given his young age, he seems
to be set to rule for a long time. Such an anniversary presents a unique op-
portunity for us to take stock of past experiences. Due to the limited space
of this article, we will confine our analysis to only some fragments of Hun
Sen’s political biography.1 The choice is limited to the elements that appear
to be instrumental in analysing the recent political processes that are still in
progress in Cambodia. Among these, we want to explore what appears to be
the most important, namely the double crisis of hegemony of Hun Sen’s lea-
dership and his party (Kanakpak Pracheachon Kampuchea, or Cambodia Peoples’
1. For Hun Sen’s biography and a long period analysis, please refer to the
works of Sebastian Strangio, Hun Sen’s Cambodia, New Haven & London: Yale Univer-
sity Press 2014 and Harish C. Mehta and Julie B. Mehta, Strongman: The Extraordinary
Life of Hun Sen, Singapore: Marshall Cavendish International, 2013.

Nicola Mocci
Party, CPP) – being «hegemony» defined in Gramscian terms.2 The hegemo-

nic crisis appears to have at least three specific elements. The first is the pro-
gressive damage to consensus, which was detected during the last elections of
2013 and brought the CPP to a loss of 22 seats in the National Assembly (the
worst election result since 1998). The second is represented by the social con-
flict that, after years of alarm signals, exploded with great violence and viru-
lence throughout the country after the elections of 2013. The government
has responded with violence and repression. The third is the strengthening
of parties and opposition movements, which has given voice to instances of
democracy, employment protection, environmental protection and human
rights, all of which have highlighted the criticality of the CPP.
On the basis of these elements, this article argues that Hun Sen
tempted to face the crisis of hegemony of his leadership and his party
without a precise strategy. In general, this is highlighted by his focus on
strengthening and centralizing the control of the government and, above all,
his party. In this way, Hun Sen became a single man in command, pursuing,
although with varying results, a single objective: de-structuring that unity of
purpose of labour, which, in latest years, has gradually taken place, although
slowly and haltingly. The result was an alternation of openings, closures
and repression against antagonists – parties, movements, politicians,
activists, trade unionist or journalists. Reference is particularly made to
the movements that, until a few years ago, were fragmented, spontaneous
and amorphous, and that, in different forms, have reached moments of
dialogue, cohesion and unity.
Hun Sen has attempted to face the crisis of hegemony by using the
international lever. He has tried in every way to exploit China to show the
positive economic impact that his government has achieved. The excellent
relations with China, which are a source of unstoppable capital flow in Cam-
bodia, have become a reason for triggering the daily rhetoric of the premier,
which is always in third person, based on the «inalienability and indispen-
sability of Hun Sen. Without Hun Sen, the country returns to civil war».3
In addressing the theme of the crisis of the hegemony of the leadership
of Hun Sen and the CPP, in the first part of this article, we will analyse
the internal dynamics of the party, the attempts of openness and Hun
Sen’s dialogue with the different movements and opposition parties. In
the second part, we will analyse the international relations, with particular
reference to China’s great support. Finally, the last chapter will analyse the
economic policy in the short and medium term.
2. For those who are not cognizant of the Italian language, see Quintin Hoare
& Geoffrey Nowell Smith (eds), Selections from the Prison Notebooks of Antonio Gramsci,
New York: International Publishers, 1971 (1st edn.), the pages listed at p. 480, under
the voice «hegemony».
3. ‘Cambodia strongman PM seeks 2018 re-election’, Reuters News, 29 April
2015.
246
Cambodia 2015
2. The renewal of the politburo of CPP after the death of the president Chea Sim
In June 2015, Hun Sen finally achieved one of his great political
objectives – presidency of the CPP. On 6 June 2015, the president of the
party, Chea Sim, died after a long illness. This certainly facilitated the
turnover of Hun Sen and the renewal of the Central Committee of the CPP.
For a long time, analysts have discussed the opportunity to separate
the roles of the government’s presidency and party leadership.4 Hun Sen’s
ascent to party leadership appeared to be obvious for two reasons. Firstly, he
has never had full control of the CPP and has always experienced internal
opposition factions, in particular those lead by the duo, Chea Sim and Sar
Kheng. Secondly, at such a stage of the hegemonic crisis of CPP, the position
of leadership, which was created by the death of Chea Sim, needed to be
filled by a strong guide with control of the party. This was needed in order
to manage the repositioning of the affiliates to Chea’s clan. Based on this
premise, in the first part of this article, we will analyse the attitudes of Hun
Sen within his own party, while, in the second, we will analyse the relations
between the CPP and opposition parties.
2.1. Chea Sim, the main antagonist of Hun Sen

Historically, the CPP was composed of more cores, which were repre-
sentatives of each broad clan, based on different territories. The two stron-
gest clans were the one led by Hun Sen and the other led by Chea Sim. The
third, which was led by Heng Samrin, the honorary president of the CPP
and of the National Assembly, did not rival Hun Sen in the same way that
Chea Sim group had.5
Chea Sim was born on 15 November 1932 to a peasant family in eastern
Cambodia’s Svay Rieng province. In the early 1950s, he joined the Khmer
Issarak6, the revolutionary movement against colonial France. He was a ca-
4. ‘The slow demise of Hun Sen’s greatest CPP rival’, Phnom Penh Post, 15 No-
vember 2014.
5. Clan’s structure of the triumvirate of the CPP (Chea Sim, Hun Sen and
Heng Samrin) has been reconstructed by Grégory Mikaelian, ‘Pour une relecture du
jeu politique cambodgien: le cas du Cambodge de la reconstruction (1993-2005)’, in
Alain Forest (sous la dir.), Cambodge contemporain, Paris: Les Indes Savantes, 2008, pp.
178-179.
6. Khmer Issarak movement (Free Khmer) was created in Bangkok in June
1945 by a group of Cambodians in exile, with the aim of organizing an armed force
that would be capable of opposing and overthrow the French protectorate in Cam-
bodia. With the support of the Thai Government, the Cambodians wanted to take
advantage of the Japanese occupation of Indochina, which had then put an end to
French colonial rule. The movement was split up at the end of the 1940s because of
different political ideologies. One group, supported by the Thai, was anti-commu-
nist; another, supported by the Vietnamese, had embraced the communist ideology.
This second group had an important role in the Vietnamese war against the French,
247
Nicola Mocci
dre of the communist, Khmer Rouge, by the time it ousted a pro-American

government in 1975.7 In 1978, he abandoned the Khmers Rouges and fled
Vietnam. In early 1979, he came back to Cambodia, following the Vietname-
se troops, who had defeated the Khmers Rouges. Chea Sim was appointed
Minister of the Interior of the Pro-Vietnamese Government, which was crea-
ted in Phnom Penh. In this team, Hun Sen was Minister for Foreign Affairs.
Since 1979, Chea Sim built his power base in the northern region of
Cambodia, in the province of Battambang. Here, his nephew, Ung Samy,
acted as Secretary of the Party and, since 1987, as Governor of the Provin-
ce.8 Chea Sim also had other strong allies in the provinces of Siem Reap and
Bantey Meanchey. However, one of his strengths was his control of the army
– first, at the end of the 80s, through his close ally, Sin Song, Minister of the
Interior, and, subsequently, through Sar Kheng, the current Minister of the
Interior and Chea’s daughter’s husband.9 The recruitment of the army of
relatives, close allies and former paintings of Khmers Rouges guaranteed
Chea Sim unparalleled strength in the party and government.
Hun Sen has always had a subaltern position against Chea. During the
years of the first government, followed by the peace agreements of 1991
and the elections of 1993, the two leaders greatly clashed. Some U.S. di-
plomats’ documents, dating back to that period, reveal the resentment and
tensions inside the CPP. These were so strong that Hun Sen was terrified
by the news of a possible attack against him, which was published by a local
newspaper. The Near-obsession, wrote that the U.S. diplomats had induced
Hun Sen to establish a government commission of inquiry in order to disco-
ver a plot.10 However, the prime minister had not entrusted the leadership
while the anti-communist group was further divided and dispersed in the North-West
of the country. During the peace conference in Geneva, in 1954, the representatives
of the Khmer Issarak presented a united front and sided with the Vietnamese delega-
tion. However, unity at Geneva was not matched by unity in Cambodia, where a part
of the movement sided with the Khmer Rouges. Many of those Khmer Issarak who al-
lied themselves with the Khmer Rouges were later «purged» by Pol Pot between 1972
and 1973, because suspected to be pro-Vietnamese. Ben Kiernan, How Pol Pot Came to
Power, London: Verso, 1984.
7. David Chandler, ‘Chea Sim (1932 -)’, in Keat Gin Ooi (ed.), Southeast Asia:
A Historical Encyclopedia, from Angkor Wat to East Timor, Volume 1, Santa Barbara CA:
ABC-CLIO, p. 323.
8. In 1993, UNTAC (United Nations Transitional Authority in Cambodia), be-
fore the elections, had requested the removal of Ung Samy, following the accusation
of having participated in the killing of members of the opposition parties. Further-
more, documents demonstrate its involvement in the group of Khmers Rouges that
ruled the security prison 21 (S-21). ‘A hard soldier and man of few words’, Phnom Penh
Post, 13 December 1996.
9. Evan R. Gottesman, Cambodia After the Khmer Rouge: Inside the Politics of Nation
Building, New Haven & London: Yale University Press, pp. 331-32.
10. ‘Secret. Further Evidence of Hun Sen’s Mental State’, Wikileaks, 14 Novem-
ber 1995.
248
Cambodia 2015
of the commission to his Minister of the Interior, Sar Kheng, as it would

have been natural to. Instead, he entrusted Co-Minister of the Interior, You
Hockri, a member of the FUNCINPEC party (Front Uni National pour a Cam-
bodia Indépendant, Neutral, Pacifique, et Coopératif).11 This clearly shows that
Hun Sen did not trust Sar Kheng.12
In 2004, after the 2003 legislative elections, there was great political
conflict between Hun Sen and Chea Sim. In this period, the three parties
that were most voted for - CPP, FUNCINPEC and Sam Rainsy Party (SRP)
- tried to reach an agreement in order to form a government coalition.
Since Hun Sen did not commit himself to the FUNCINPEC, he proposed
an amendment to the constitution, which would have allowed the vote of
confidence to the government by show of hands, instead of in secret. In this
way, he would have avoided any votes against the maverick party members
of parliament. Chea Sim, as president of the Senate and acting behind the
mandate of the King (who, in that period, was abroad) as head of state, had
refused to promulgate the act, which greatly annoyed Hun Sen.13 Chea Sim
was forced to leave the country in order to take refuge in Thailand, although
officially for a period of medical care.14
In the subsequent years, conflicts between the two clans continued.
In 2011, the group of Chea Sim-Sar Kheng suffered a further setback, fol-
lowing a scandal involving a group of Chea Sim’s consultants. In the space
of a few months, six members of staff were arrested, tried and sentenced for
fraud and the illegal possession of arms and drugs.15
11. From 1993 until 1997, the Cambodian government was ruled by an unprec-
edented coalition, formed by the CPP and FUNCINPEC, and by two prime ministers:
Norodom Ranariddh (first prime ministry) and Hun Sen (second prime ministry).
12. ‘Secret. Further Evidence of Hun Sen’s Mental State’, Wikileaks, 14 Novem-
ber 1995.
13. Chea Sim took over the presidency of the CPP, since its birth in 1991, and
was president of the Senate from 1999. He was also the head of the provisional status
in 1992-93, as Chairman of the Council of State, before Cambodia became a constitu-
tional monarchy. He also stepped in briefly as head of state for the King in 1994 and
1995. Chea Sim was acting as head of state again for a week after Sihanouk’s abdica-
tion until Norodom Sihamoni became King on 14 October 2004.
14. The details concerning the conflicts of that period were reconstructed by
Sorpong Peu, ‘Consolidation or Crisis of Democracy? Cambodia’s Parliamentary
Election in 2003 and Beyond’, in Aurel Croissant & Beate Martin (eds.), Between Con-
solidation and Crisis. Election and Democracy in Five Nations in Southeast Asia, Berlin: Lit
verlag, 2006, pp. 41-84.
15. ‘Chea Sim bodyguard chief seized’, Phnom Penh Post, 15 August 2011. After
the imprisonment of Chea Sim’s staff members, Hun Sen took advantage of the scan-
dal to appoint his crony friend, Yim Leang, as the head of the guards of the President
of the Senate. Yim Leang, who was appointed General in 2001, at the age of 28 years
(the youngest general in Cambodia), is the son of Yim Chhay Li, the deputy prime
minister of the last two governments of Hun Sen. Moreover, the sister of Yim Leang,
is married to Hun Many, Hun Sen’s third-eldest son.
249
Nicola Mocci
2.2. The Control of the armed forces by Hun Sen

Against the background of these events, we must not forget Hun Sen’s
actions since the 90s to counter the hegemony that the Chea Sim clan has
always had on the army. Legitimized by the overwhelming victory of the
2008 elections, Hun Sen made an important and significant move - the
alternation of the commander in chief of the army, General Ke Kim Yan,
whose daughter married the son of Sar Kheng.16 In his place, Hun Sen
appointed Pol Saroeun,17 who had been his close crony since the 1980s. He
also appointed six new generals, who were known to be close to the prime
minister. His aim to control the army continued in 2012, when Hun Manith,
his second son, was promoted to Brigadier General and Deputy Chief of Mi-
litary Intelligence Unit (MIU).18 In 2015, at the age of 34, Hun Manith, who
was the country’s youngest four-star general, assumed the direction of the
MIU.19 Furthermore, Hun Sen’s eldest son, Manet, has also had a successful
career in the armed forces. In 1999, he obtained his diploma in the presti-
gious U.S. military West Point Academy. Manet, who is currently Lieutenant
Brigadier, commander of the 911 Airborne Brigade’s counter-terrorism
unit, is regarded as one of the best candidates to succeed his father.20
Hun Sen has no chosen one of his sons to direct the intelligence in a
period of political instability, marked by workers’ protests, tensions within
the party and Islamic terrorism dangers.
Many of Hun Sen’s unprecedented announcements during 2015 have
been in this context. The army was vigilant against such «coloured move-
ments», which, displaying the principles of democratic alternation, want to
overthrow the government.21 In July, faced with an unprecedented audience
formed by 5,000 members of the army and police, Hun Sen called on the
armed forces to take immediate measures against any political group that
was attempting to overthrow the «legitimate» regime.22
To complete the picture of the dynamics between the government and
the armed forces, it is useful to cite a further element that was made public
16. Pol Saroeun, appointed Secretary of the CPP in Takeo Province in the mid-
80s, had contributed to the removal of Heng Samrin from the leadership of the PPC
and the subsequent appointment of Hun Sen to vice-presidency. ‘One big happy fam-
ily in Cambodia’, Asia Times online, 20 March 2007.
17. ‘Party factionalism looms behind Ke Kim Yan sacking’, Cambodia Information
Center, 21 febbraio 2009.
18. ‘Hun Sen’s second son in meteoric rise through RCAF ranks’, Cambodia
Daily, 30 January 2012.
19. ‘Hun Manith New Head of Military Intelligence’, Cambodia Daily, 23 Oc-
tober 2015.
20. ‘On Australian TV, Hun Manet Lauds Father’s 30-Year Reign’, The Cambodia
Daily, 19 October 2015.
21. ‘Military’s role to help Government, PM says’, Phnom Penh Post, 5 March
2015.
22. ‘Hun Sen calls on police to be loyal’, Phnom Penh Post, 24 July 2015.
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Cambodia 2015
in 2015. Every year, the Royal Cambodian Armed forces receive financial
backing from both local and foreign large companies. In a public discourse,
the Minister of Defence, Tea Banh, stated that the number of companies
that financed the armed forces had gone from 42 to 100.23 Considering this
admission, it is easier for us to understand why, during 2015, on many oc-
casions, different chiefs of the armed forces openly guaranteed their loyalty
to the CPP as opposed to the government. 24
However, it is significant that at least nine deputy National Police com-
missioners, in addition to several powerful generals and military comman-
ders - some of whom directly ordered crackdowns on political protests after
the July 2013 election, were elected to the CPP central committee. These
include Phnom Penh, Police Chief; Chhuon Sovann, RCAF Deputy Com-
mander; Chief of the Prime Minister’s Bodyguard Unit, Hing Bun Heang;
and Phnom Penh Military Police Commander, Rath Sreang. 25
2.3. The question of the Vice Presidency of the CPP

Immediately after the death of Chea Sim, Hun Sen was elected presi-
dent of the CPP and Sar Kheng was elected vice president. It is important to
note that Hun Sen did not wish for Sar Kheng to act in complete autonomy
as vice president. He wanted Say Chhum, a faithful crony, to act with Sar
Kheng.26 Once again, this highlights how the prime minister did not trust
Sar Kheng during the phase of transition and hegemonic crisis.
Say Chhum has been a crony of Hun Sen’s clan since the 1980s. After
the death of Chea Sim, some political analysts maintained that he could be
the next president of the CPP. Say Chhum was elected in the Kampong Speu
constituency. In the 11th session of the first People’s Republic of Kampuchea,
National Assembly on 25th July 1986, he was appointed Agriculture Mini-
stry. In 1987, Hun Sen appointed him Deputy Prime Minister, together with
Chhay Than, Minister of Finance; and Ho Non, Minister of Trade. In 1997,
he was appointed Co-Minister of Interior and Secretary General of CPP.
As a member of the Standing Commission of the Central Committee and
chairman of the Organization Committee of the party, he has always played
a role of mediation between the factions of the party, as well as between the
CPP and opposition parties. Say Chhum was in the first row in the periods
of political crisis, for example, in the period that followed the 1997 bomb
23. ‘In praise of RCAF Inc’, Phnom Penh Post, 30 July 2015.
24. Reference is made in particular to the statements pronounced during an
interview by General Chea Dara, RCAF Deputy Commander-in-chief, who said the
military’s role was to secure the position of the ruling CPP ‘Cambodia’s Well-Heeled
Military Patrons’, The Diplomat, 10 August 2015.
25. ‘CPP Bigger, not better, say Foes’, Phnom Penh Post, 3 February 2015.
26. Jacques Bekaert, Cambodian diary, a long road to peace 1987-1993, Bangkok:
White Lotus Press, 1998, p. 59.
251
Nicola Mocci
attacks or after the elections of 2003, when he facilitated the dialogue with
the opposition parties to find a coalition government agreement.
For these reasons, even before the elections of 2002, some of the press
had declared that Say Chhum was one of the best candidates to challenge
the premiership of Hun Sen, together with Sar Kheng, and Chea Sophara,
Mayor of Phnom Penh. 27
During the apparent renewal phase of the CPP, Say Chhum was con-
firmed to have taken the position of Secretary General, in addition to assu-
ming the co-vice presidency.
2.4. The opening of the party to the young people

The Congress of CPP was opened in January 2015, a few months befo-
re the death of the party’s president, Chea Sim. The Congress was the ideal
occasion to analyse the crisis of hegemony and identify the best strategies
for addressing it. However, at least from what was officially reported, it ad-
dressed the need to rejuvenate the party and pay attention to the young
people of the country. On this ground, the CPP is considered to have lost
competition with the opposition’s parties and movements. Therefore, ta-
king into account the fact that 68% of the population (14.8 million) is un-
der 30 years of age, the party took into consideration the needs of young
people. From this point of view, the party’s first act was to rejuvenate the
Central Committee by adding 306 new members. This more than doubled
the committee’s size to 545. Apparently, their goal has been achieved since
70 of these new members are under 50 years of age.28 The second act was
to entrust Hun Sen son, Many, with the task of creating a school of politi-
cal formation for the young people. Besides arranging a delegation trip in
China for the party’s young activists, it does not seem that Hun Many has
organized any successful initiatives.29 Furthermore, it is still not still known
what modalities the CPP’s school of formation should operate and what
themes will be addressed.
However, on closer inspection, the party’s opening to the young pe-
ople appears to have been a populist announcement that has been devoid
of effectiveness, especially in view of two important elements. The first ele-
ment is related to the fact that the party’s crisis stemmed from their inability
to represent the needs of an urbanized and poorly skilled young working
class, as opposed to a generic category of an indeterminate class of young
people. For a long time, the CPP have underestimated the strikes and de-
27. ‘Hun Sen Nominated as CPP Premier Candidate for Next Term’, Kyodo
News, 16 December 2002.
28. ‘CPP leadership sees influx of new blood’, Phnom Penh Post, 2 February
2015.
29. ‘Large-scale Cambodian Youth Delegation to Visit China’, Xinhua News
Agency, 20 June 2015.
252
Cambodia 2015
monstrations for better working conditions and in general to affirm a new

subjectivity of the work and a social justice. Moreover, the recent period of
violent repression of the world of labour and prohibitions of public protests
and demonstrations have progressively pushed the party further away from
the electorate.
The second element is at odds with the CPP’s new strategies - nepotism.
This can be seen among the party’s elite and the government. In fact, at
least a dozen of the party’s elders, in addition to the Hun Sen’s three sons,
occupy positions of importance in all of the institutions.
3. The «culture of dialogue»
Another difficulty of the CCP is Hun Sen’s attempt to converse with a

multiplicity of political actors. These include large parties, like CNRP; his
former friend-rival, Norodom Ranariddh; and small opposition movements
such as Kem Ley’s Khmer for Khmer, Mam Sonando’s Beehive and Sourn
Serey Ratha’s Khmer People’s Movement. 30
At the beginning of January, Norodom Ranariddh announced his re-
turn to the guidance of FUNCINPEC. FUNCINPEC was founded by Rana-
riddh’s father, Norodom Sihanouk in 1981. In 2006, the party was expelled
for the misappropriation of its funds. The royalist party almost entirely di-
sappeared from the Cambodian political landscape. However, some mem-
bers of the royal family have maintained a strong presence on the elec-
torate. As such, Ranariddh seems certain to obtain strong support in the
next municipal elections, which are scheduled in 2017. According to some
analysts, the return of Ranariddh could be a move that was advocated by
Hun Sen in order to create an alliance between the CPP and FUNCINPEC,
in view of the parliamentary elections of 2018.31
In his tireless quest for consensus, Hun Sen has not only conversed with
political actors but also, religious groups like the community of Muslims. It
is estimated that the Islamic community in Cambodia accounts for about
600,000 Muslims. Consequently, it represents an interesting group of po-
tential votes. On 31 May, in Phnom Penh, Hun Sen inaugurated the newest
and greatest mosque in Cambodia during a ceremony that was participated
30. ‘Cambodian politics: Hun Sen manoeuvres for power as younger voters
rise’, Nikkei Report, 30 January 2015.
31. ‘Cambodia’s Political Prince Makes Comeback, Claims PM’s Support’, Reu-
ters News, 5 January 2015. The announcement of the return to politics issued by No-
rodom Ranariddh has caused a great stir in Cambodia because of its controversial
past. Inter alia, the police have begun an investigation on the automobile accident in
which he was involved in the month of April 2015, since this would not be an accident
but an intimidating terrorist act. ‘Ranariddh in Car Accident’, Phnom Penh Post, 27
April 2015.
253
Nicola Mocci
by 1,000 people.32 The following month, repeating an event that was star-
ted in 2014, the prime minister organized the iftar for 4,000 Muslims - the
evening meal that breaks the fast of Ramadan.33 Dialogue with the Cambo-
dian Muslim community has allowed Hun Sen to establish closer relations
with the South East Asian Muslim Countries such as Malaysia. It is worth
noting that Hun Sen appointed Othman Hassan, President of the Cambo-
dian Muslim Development Foundation, as State of Ministry of Labor and
Vocational Training, as well as Advisor to the prime minister.
However, the unprecedented dialogue that Hun Sen established with
Sam Rainsy, the leader of the opposition coalition, had an even greater
impact. This will be discussed in the next paragraph.
3.1. The Culture of Dialogue Between the CPP and CNRP

In April, during the celebrations for the new lunar year, after months
of fighting, the CPP and the opposition coalition of CNRP started the so-
called «culture of dialogue».34 This political dialogue primarily focused on
trying to find an agreement on a series of reforms. Among these were the
electoral reform, the regulation of the trade unions and the regulation of
the activities of the Non-Governmental Organizations (NGOs). All of these
reforms concerned very delicate subjects such as involvement in the world
of labour and various categories of social actors, as well as international
investors and the community of the donor countries. In the past, the go-
vernment had attempted to deal with the rules of the trade unions and
NGOs. However, on every occasion, there were local protests and interna-
tional pressures to stop discussions in Parliament. In order to prevent any
further criticism and avoid worsening the social conflict, Hun Sen wanted
to enlarge the discussion boards by inviting the opposition parties and trade
unions to negotiations.35
The regulation of NGOs (Law on Associations and Non-Governmental
Organizations – LANGO) that was strongly desired by the premier was the
reform that immediately tested the culture of dialogue. In Cambodia, from
1991, after the intervention of the UNTAC, there was a growing organiza-
tion. In 2015, there were about 5,000 local and international organizations
32. The Alserkal Grand Mosque was built on Phnom Penh’s landfilled lake,
Boeung Kak, with a 2.9 million dollar donation from the UAE national Eisa Bin
Nasser Abdullatif Alserkal. ‘PM Opens Mosque, Praises Religious Tolerance’, Khmer
Times, 27 March 2015.
33. ‘Cambodia’s Largest Mosque Opens in Phnom Penh’, Bangladesh Monitor,
31 May 2015. ‘Cambodian PM Hosts Ramadan Iftar Dinner for Over 4,000 Muslims’,
Xinhua News Agency, 26 June 2015.
34. ‘Cambodian PM, Opposition Leader Jointly Open Angkor Sankranta Festi-
val for Khmer New Year Celebrations’, Xinhua News Agency, 14 April 2015.
35. ‘Labour day: Unions, CPP promote factory ties’, Phnom Penh Post, 20 April
2015.
254
Cambodia 2015
and, on the whole, there were about 4,000 development projects operating
with a total budget of approximately $600-700 million per year.36 It is un-
derstandable that, with the substantial amount of money that the communi-
ty of donors offer to Cambodia, there is a great interest in any intervention
of the legislator on this matter.
The most controversial points of the draft law were related to the obliga-
tion that was imposed on the local NGOs to register at the Ministry of Interior
and international at the Ministry of Foreign Affairs. In addition, organizations
are required to regularly submit their work progress and financial reports.
Article 25 and 30 of the law states that any organization will be erased
from the registration list if it fails to report to the ministries. Furthermore,
it says that those that are not registered are «not allowed to conduct any
activities» in Cambodia. Even if approved, «NGOs must be neutral towards
all political parties» and the government can request full details of activities
and finances if it deems it «necessary» to do so.37
The law proposal aroused numerous protests that stigmatized the de-
sire of the government to impose a series of controls and restrictions on
the activities of the NGOs, contemplating the closure in evidence of non-
compliances and of serious violations.38 Most of the NGOs – affirmed the
opponents – are small associations that work in the countryside. Those in
the countryside are more sensitive to the problem of land grabbing and, of-
ten, they do not have the expertise to meet all of the government’s requests.
Substantial amendments to the draft law were suggested by the UN,
U.S. and EU. The parliament of the EU even threatened to freeze a sum
of €700 million of aid to Cambodia in a case in which the law had been
approved.39
In this context, the coalition of opposition and, in particular, Sam
Rainsy, strangely remained silent. Sam Rainsy, who was trapped in the cul-
ture of dialogue, affirmed that: «The prime minister confirmed to me that
civil society groups should not worry too much. Civil organizations that
are in operation are not required to re-register. They will automatically be
recognized.»40
36. The number of NGOs working in Cambodia has never been established
precisely because of the lack of an official register, in addition to the volatility of the
associations. The government sources do not offer official data in this regard while
press agencies offer different vague data.
37. ‘NGO Law a «disaster»’, Phnom Penh Post, 10 June 2015.
38. ‘Cambodia Scolds UN Reps Over NGO Law Criticism’, Government Publica-
tions and Press Releases, 21 May 2015; ‘Activists against anti-NGO law march in Cam-
bodian capital’, Xinhua News Agency, 30 June 2015.
39. ‘European Parliament resolution on the situation in Cambodia: draft laws
on the NGOs and trade unions (2015/2756 -RSP)’(http://www.europarl.europa.eu/
sides/getDoc.do?type=MOTION&reference=B8-2015-0693&language=EN).
40. ‘Cambodian Civil Society Groups Protest Against NGO Draft Law’, Voice of
America Press Releases and Documents, 29 June 2015.
255
Nicola Mocci
On 13 July, the law was approved with some amendments, with respect
to the initial draft, while the CNRP had not participated in the Parliament
vote to protest. However, that same evening, when, on other occasions, op-
position parties would have called a strong protest, Hun Sen and Sam Rain-
sy, together with their families, unexpectedly took dinner together. Pictures
of the families of the two bitter enemies on the same table appeared on
social media and aroused great international acclaim, in addition to discon-
tent within the CNRP.41
3.1.1. Further cracks and the collapse of the culture of dialogue

Discontent inside the CNRP was repeated and made worst on 21 July,
when 11 activists of the CNRP, who had participated in one of the numerous
protests from the summer of 2014, were sentenced to seven years for fomen-
ting an «insurrection», and 20 years for «leading an insurrection».42 In the
face of protests of the opposition parties and NGOs, Hun Sen stated that,
to the contested offences, «The judges were far too lenient».43 The premier
also added: «It would have been appropriate also to arrest the other activists
who had instigated the protest».44 In fact, at the beginning of August, three
more activists were arrested.
The day when the judgement was announced, Sam Rainsy was not in
place to drive the protest, as expected by the militants, but left for France.
Interviewed by a French newspaper on the condemnations, Sam still main-
tained low tones and stated that it was a gesticulation, namely the exaggera-
tions of the judiciary. Sam also added that, in any case, the condemnations
would not have undermined the culture of dialogue with CPP.45
After that particular interview, it was clear that the intolerance of the
members of the CNRP in respect of their leader and the culture of dialo-
gue began to emerge. A number of previous accusations from 2014 were
repeated, for example, the base of the CNRP had shown discontent towards
Sam Rainsy for having conducted negotiations with Hun Sen without ha-
ving been involved. 46
With the growing tensions between the CPP and CNRP, the situation
progressed on 15 August, when a CNRP senator was arrested and charged
with serious unrest. This accusation was based on a fake document that was
posted on Facebook. This document claimed that an article of the 1979
Cambodia-Vietnam Friendship Treaty was meant to dismantle, rather than
41. ‘My dinner with Rainsy’, Phnom Penh Post, 13 July 2015.
42. ‘Freedom Park 11 jailed’, Phnom Penh Post, 22 July 2015.
43. ‘Cambodian PM says he has no rights to free opposition prisoners’, Xinhua
News Agency, 27 July 2015.
44. Ibid.
45. ‘Le pouvoir cambodgien fait tout pour diffuser la peur’, Liberation 23 July 2015.
46. Stéphanie Giry, ‘Autopsy of a Cambodian Election: How Hun Sen Rules’,
Foreign Affairs, 1 September 2015, Volume 94; Issue 5, in particular §5-6.
256
Cambodia 2015
simply define, the border between the two countries. Charged with forging
a public document, the senator could carry a combined maximum prison
sentence of 17 years.
At that point, the two political forces went back to their traditional
conflict with reciprocal accusations of unreliability, dishonesty and betrayal,
as had already been heard in recent years. At the end of October, there was
a further escalation, characterized by a series of events. First, two members
of the CNRP were attacked just outside the gates of Parliament. Dragged
from their vehicles, they were assaulted by protesters and a group of CPP
activists. The sit-in was organized against Kem Sokha, the first Vice Presi-
dent of the National Assembly, as well as the Vice President of the CNRP,
for having criticized Hun Sen during a public discourse on the day before.
Within a few weeks, it was ascertained that the leaders of the beatings were
three policemen.47
As a result of this beating, the lower chamber voted a «citizen propo-
sal» for the removal of the Vice President of the National Assembly, Kem
Sokha. This was proposed by CPP’s supporters and signed by 300,000 citi-
zens, in virtue of the inadequacy of the vice president.48 Subsequently, on
11 November, the leader, Sam Rainsy, faced an arrest warrant in relation to
a prosecution for defamation against the Foreign Minister, Hor Namhong,
dating back to 2008.49 Following the arrest warrant, the President of the
National Assembly decreed the revocation of the parliamentary immunity
of Sam, which decided not to return to Cambodia, while the CNRP decided,
once again, to abandon Parliament.
Within a few months, Cambodia relapsed into a stalemate, as had hap-
pened after the elections of 2013, when the CNRP had refused to partici-
pate in the parliamentary work to protest against alleged electoral fraud.
4. International relations
In the 30 years of Hun Sen’s government, the international relations of

Cambodia were characterized by a policy of equal distance with the major
powers, China and the US, in particular, and good neighbourly relations.
This attitude has assured the country’s internal stability in addition to a
continuous flow of investments and aid from both the western and Asian
47. ‘Three RCAF members charged for beatings’, Phnom Penh Post, 5 November
2015.
48. ‘Sokha stripped of National Assembly Vice Presidency’, Phnom Penh Post, 30
October 2015.
49. ‘Arrest Warrant Issued for Cambodian Opposition Leader Sam Rainsy’,
BBC News, 13 November 2015. The French Supreme Court had already addressed
the case suit relating to defamation. This Court determined in Paris in 2011 that Sam
Rainsy was not liable to any condemnation.
257
Nicola Mocci
side. In the last decade, relations between Beijing and Phnom Penh have
intensified and strengthened. This is due to a flow of capital that China
provided for Cambodia in the form of investments, subsidized loans and
donations. In addition to the economic benefits, according to Sebastian
Strangio, the solid bond between the two countries ensured that the Cam-
bodian government could exercise power on the level of internal policies.
At the same time, it is important to note that foreign policies are affected by
foreign «conditionalities».50
In fact, Hun Sen, has always suffered with «conditionalities» (respect
for democratic principles and human rights), which were duly imposed by
the western donors to the Cambodian government. In 2009, the U.S. Em-
bassy noted: «Hun Sen frequently praises China for its ‘blank check’ policy
on assistance, and criticizes other donors who to seek to condition aid on
political and economic reforms in the country. […] Hun Sen lauded the
Chinese for providing assistance with no strings attached, saying ‘they are
quiet, but at the same time they build bridges and roads, there are no com-
plicated conditions». 51
However, on an international level, China also presented its conditio-
nalities to Cambodia, so much so that the government of Phnom Penh, in
the toughest issues relating to territorial disputes in the South China Sea
(SCS) and the demarcation of the Exclusive Economic Zones, is deployed
securely to the side of Beijing.
The main stages that led to the Cambodian engagement with China
and the regional consequences will be analysed in detail in the following
paragraphs.
4.1. The enveloping embrace of China

Since the early 1950s, China had had a policy of aid to countries of the
communist block.52 After the conference of Bandung in 1956, it also gran-
ted financial and military aid to non-aligned or neutral countries. After the
Korean War, the aim of both the Chinese government and Chinese Commu-
nist Party was to rebuild its image and show that is a reliable and responsible
player in the international arena.
Cambodia received much more aid from China than other countries
(in that period, $6 million). This was because, in 1958, Norodom Sihanouk
recognized the Beijing government and, at the same time, worked with
50. Sebastian Strangio, ‘Evolving Diplomacy: Amid Cambodia-Vietnam Border

Tensions, a «Special» Relationship Evolves’, Nikkei Report, 30 July 2015.
51. ‘Confidential. A Grateful China Rewards Cambodia’, Wikileaks, 22 Decem-
ber 2009, §6.
52. Among these, had received aid: North Korea, North Vietnam and Inner
Mongolia since 1953. Peter Andrews Poole, ‘Communist China’s Aid Diplomacy’,
Asian Survey, Vol. 6, No. 11, Nov. 1966, pp. 622-629.
258
Cambodia 2015
great commitment in order to expel the Republic of China (Taiwan) from

the UN.53
Despite not having any sympathies to the communist party, Sihanouk
accepted their aid for both internal and foreign political reasons. From an
internal point of view, Sihanouk restrained the opposition, in particular that
of the leftist intelligentsia. On an international level, he avoided taking si-
des with one of the blocks and held a neutral attitude. In this way, Sihanouk
was able to obtain two results. The first was to ensure that his country obtai-
ned financial aid by more countries such as the US, Japan and France. The
second was related to the acquisition of a hedge, in the case where Vietnam
became communist and China would have done the same via the region’s
arbitrator and moderator. From 1964 onwards, the engagement with Bei-
jing also provided the first military supplies.54
In 2008, the 50th anniversary of diplomatic relations between Cambo-
dia and China was celebrated with the signature of a financial aid program-
me to Cambodia ($256 million). This was intended for the construction of
roads and bridges. This agreement was just a prelude to a renewed under-
standing that, in the subsequent years, it would converge a stratospheric
amount of Yuan to Cambodia. In Washington, the U.S. Ambassador, Carol
Rodley, reported such agreement between Beijing and Phnom Penh, sta-
ting: «Cambodia’s ‘Year of China’ looks to become its ‘Century of China’».55
From that moment, China’s aid policy in Cambodia has never stopped, and
has been a continuous source of projects and funding.
During the official visit in Phnom Penh on 23 December 2009, Xi Jin-
ping, the then Vice President of PRC, formalized the granting of $1.2 bil-
lion (part non-repayable and part a subsidized rate) for the construction of
infrastructures and technological assistance. In 2010, relations between the
two countries were sealed by the signature of the comprehensive Strategic
Partnership in December 2010. This was a five-year programme that gua-
ranteed Cambodia a flow of Chinese investments for a total of $2.5 billion.56
Among the various projects that were financed by China in Cambodia,
between 2011 and 2013, it is important to mention the construction of the
new container port in Sihanoukville and the construction of an oil refinery,
the first in Cambodia, with an investment of $1.67 million.57 However, it is
also worth pointing out that the infrastructure funded by the Chinese go-
53. Touch Siphat, ‘Patterns and Impacts of Chinese Assistance in Cambodia’,

in Yos Santasombat, Impact of China’s Rise on the Mekong Region, New York: Palgrave
2015.
54. Alain-Gerard Marsot, ‘China’s Aid to Cambodia’, Pacific Affairs, Vol. 42, No.
2, Summer 1969, pp. 189-198.
55. ‘Confidential. Cambodia’s Year Of China’, Wikileaks, 25 December 2008.
56. ‘China, Cambodia Agree to Build Comprehensive Strategic Partnership’,
Xinhua News Agency, 13 December 2010.
57. ‘China to Finance Refinery for Cambodia’, The Wall Street Journal, 16 Oc-
tober 2013.
259
Nicola Mocci
vernment, in most cases, ended up facilitating the activities of the Chinese

companies.
It is estimated that, over the last 20 years (1994-2014), Chinese in-
vestment in Cambodia has reached more than US$10 billion. Furthermore,
in November 2014, during bilateral meetings on the Asia-Pacific Economic
Cooperation (APEC) side-lines, Hun Sen was able to secure promises of at
least another US$500 million in soft loans annually, on top of the US$2.85
billion that was secured between 1994 and 2014. 58
In 2015, Hun Sen inaugurated six bridges, thanks to the financial
support of China, and was repeatedly asked to be able to be part of the new
belts and new «silk roads». 59
4.2. The vision of Hun Sen over China

On one hand, the enveloping embrace of China has allowed Hun
Sen’s government to ensure substantial financial aids and investments. On
the other hand, the Cambodian alignment on the Chinese positions has
caused problems for the traditional policy of equal distance with the major
powers. Some frictions are highlighted within the regional for a, such as
ASEAN, which are related to the CSC’s questions.
With reference to the ASEAN, the Sino-Cambodian alignment contri-
buted to creating a fracture in July 2012, during the 45th Foreign Ministers
Meeting. Here, Cambodia was deployed to openly support Beijing’s posi-
tions. China, in fact, had pressed in order to address the SCS’s disputes on
a bilateral basis. Instead, Vietnam, Philippines, Malaysia and Brunei asked
that the issues of the SCS were discussed inside the forum. For the first time
in 45 years, a forum of ASEAN ended without a joint statement and Cam-
bodia, which, in 2012, had the presidency of the forum, was pointed out as
being mainly responsible for the failure of the dialogue.
Three years later, the fracture has not yet recomposed, despite the fact
that the presidency of ASEAN has alternated the Brunei, Myanmar and in
2015 Malaysia.
In reality, the problems of ASEAN are not solely due to the different
positions on the issues of the SCS. Frictions in the regional forum also
stemmed from the debate on the new medium and long term plans, which
once closed the action of the Millennium Development Goals. The creation
58. ‘A mountain to climb’, The Edge Financial Daily, 6 January 2015.

59. ‘Cambodian PM’s Trip to China Concludes with Fruitful Results: Official’,
Xinhua News Agency, 17 October 2015. According to the Chinese Ambassador in
Cambodia Bu Jianguo, so far, China has provided financial aid to Cambodia to build
roads in the length of 2,669 kilometres, representing about 35% of Cambodia’s total
roads. Some 1,437 km have already been constructed, as 821 km are under construc-
tion and 411 km are planned to start construction. ‘Cambodia Breaks Ground on
China-funded Road to Connect Thailand’, Xinhua News Agency, 4 May 2015.
260
Cambodia 2015
of an economic community, one of the advocated projects in early 2000s,

still remains wrapped in uncertainties and requires a profound rethinking
on the basis of the new regional equilibrium. Reference is made, for exam-
ple, to the new Trans Pacific Partnership (TTP) agreement, which involves
only two of the countries of ASEAN (Singapore and Malaysia), to the new
security forums or the new international financial institutions promoted by
China, or even the threat of the Islamic State. 60
In this respect, it should be recalled that, in 2015, Cambodia was ac-
cepted «as partner in dialogue» of the Shanghai Cooperation Organiza-
tion. This is the only country of ASEAN that accesses the forum.61
With regard to the tensions between Cambodia and its neighbours,
reference is made to karstic matters on contended borders between Cam-
bodia and Vietnam, which, once again, resurfaced during 2015. It is true
that, in the past, the question of the borders of Vietnam was considered to
be an internal problem concerning the criticism of opposition parties in
respect of the common wire-Vietnamese CPP. Hun Sen, in fact, has always
been accused by his detractors to have sold pieces of Cambodian territories
to Vietnam. In July 2015, along the border of the province of frontier of
Svay Rieng, there were continuous protests on the part of the Cambodians,
following the creation of artificial pounds by the Vietnamese, whose waters
invaded the Cambodian territories.
In order to avoid repercussions on an inner level, by feeding the na-
tionalist instances and anti-Vietnamese movements, Hun Sen acted imme-
diately on an international level, involving different actors including the
UN, France, the United Kingdom and the US. The UN and all of the go-
vernments requested copies of the geographical maps that were processed
during the peace conference in Geneva in 1954, in order to locate the exact
boundaries.62 Once the government verified that the maps were sent by
France and established that Cambodia had not surrendered the territories
to Vietnam, the opposition parties were disarmed.63
However, as far as relations between Cambodia and Vietnam are
always solid, it should not be underestimated the fact that, for the first
time in 2015, the Cambodian Minister of Foreign Affairs, Hor Namhong,
officially asked Hanoi to put an end to the activities of the occupation
60. The debate on the priorities to be addressed in future visions of ASEAN

have emerged in the meeting of 2015 chaired by Malaysia. ‘What Did the 26th ASE-
AN Summit Achieve?’, The Diplomat, 28 April 2015.
61. ‘Cambodia Becomes Dialogue Partner in SCO’, Tass Russia News Agency,
24 September 2015.
62. ‘Hun Sen asks UN for help on Vietnam problem’, Phnom Penh Post, 6 July
2015; ‘Cambodia Asks U.S. for Old Maps to Settle Border Dispute with Vietnam’,
RFA, 15 July 2015.
63. Cambodia’s Border Demarcation Map Indistinguishable from France’s,
Vietnam News Agency Bulletin, 3 September 2015.
261
Nicola Mocci
of Cambodians territories.64 In the past, when other violent protests of

Cambodian villages near the border with Vietnam had inflamed nationa-
list Cambodian souls, Phnom Penh had never made such requests to Ha-
noi. Cambodia’s attitude is more assertive towards Vietnam, which brings
to mind another curious fact that dates back to December 2013. During
a visit to Hanoi, Hun Sen spoke to his audience in Vietnamese. Given
the damage that this could do to his standing domestically, it could only
be seen as a gesture of conciliation. It seems likely, as argued by some
analysts, that the enveloping embrace of China to Cambodia has brought
Hun Sen to a redefinition of the attitude towards Vietnam, which is no
longer based on a position subordinate but rather, equal footing.65
5. The Growing Economy and Worries for the Future
In the context of the hegemonic weakness of Hun Sen’s leadership

and his party, in 2015, the public speeches by the premier were preoc-
cupied with announcements related to the economic results that were
achieved by his government. During his long experience of being part of
a government that has faced difficulties in internal policies, Hun Sen has
always supported the principle of the indispensability of his role due to the
positive macro-economic data. Moreover, macro-economic data have been
constantly positive and, in 2015, the growth of GDP was expected to remain
at 7.3%, compared to the previous year.66
However, in 2015, for the first time, the government presented a new
industrial development plan that provides for the diversification of indu-
strial production. Next to rice and garments, which are the driving sectors
of the economy, it aims to develop other activities that employ a higher
cognitive level. In this way, the government intends to raise the share of
GDP created by industry from 24.1% in 2013 to at least 30%.67 This diver-
sification can be done through the creation of a favourable environment
to FDI and settlement of industries with higher specialization. Hun Sen
argued that this would reduce taxation and improve the infrastructure and
bureaucracy. Some analysts have pointed out that this programme’s com-
plexity clashes with others issues (e.g., a lack of skilled human resources
64. Sebastian Strangio, ‘Evolving Diplomacy: Amid Cambodia-Vietnam Bor-

der Tensions, a «Special» Relationship Evolves, Nikkei Report, 30 July 2015.
65. Ibid.
66. ‘ADB Sees Robust Growth for Cambodia’s Economy’, Cambodian Business
Review, 31 May 2015.
67. ‘Cambodia Launches Industrial Development Policy for Next 10 Years’,
Xinhua News Agency, 26 August 2015.
262
Cambodia 2015
and very high production costs) and it can only be addressed by stages in
the medium-long term. 68
Considering this, it can also be assumed that the new industrial plan
aims to counteract the negative effects that the agreements of the TPP and
the EU-Vietnam Free Trade Agreement (both signed in 2015) could have in
the field of Cambodian exports. 69
Next to the new industrial plans, from an economic point of view, the ac-
tivity of the government in 2015 was characterized by actions that were aimed
at neutralizing the fuses of the social conflict. Among these, we can mention:
the announced intention to reduce the price of electricity to the garment’s
workers living in the industrial area of Phnom Penh;70 the announced incre-
ase of the threshold of minimum income not taxable;71 and the announced
intention to remove taxes on motorcycles.72 Furthermore, with the aim of al-
leviating the criticism of NGOs concerning the question of land grabbing and
avoiding protests by farmers, the government has given great emphasis to the
moratorium on new economic land concessions (ELC). Hun Sen already an-
nounced in 2012 and 2015 that, for the first time, the authorities withdrawn
certain ELC to large companies for the lack of requirements.73
Finally, Hun Sen’s government has sought to defuse the aspects that
are more incandescent, which could ignite social conflict inside the wor-
king class. The attempt to institutionalize the dialogue between the State,
companies and trade unions, creating a model of tripartism, has not given
rise to great enthusiasm, especially on the part of workers. Workers , in fact,
repeatedly denounced that some trade unions taking part in the negotia-
tions would be strongly influenced by the government and would not be
representative of the workers. The main consequence of this is the slowdown
of the question of minimum wage. 74
68. ‘Cambodian Gov’t Passes Industrial Development Policy for Next Decade’,
Xinhua News Agency, 6 March 2015.
69. ‘TPP puts Cambodia’s trade, investment in the Spotlight’, Phnom Penh Post,
7 October 2015.
70. ‘Workers set to get EdC deal’, Phnom Penh Post, 15 January 2015.
71. ‘Reforms raise income tax floor to $200’, Phnom Penh Post, 8 January 2015.
72. ‘Cambodia to Eliminate Road Taxes on Motorcycles: PM’, Xinhua News
Agency, 22 October 2015.
73. ‘Major tycoons added to concessions watchlist’, Phnom Penh Post, 9 March
2015. The withdrawal of some concessions, relatively to a few hundred hectares, hides
much more consistent data. In 2013 alone, 230 companies were granted ELCs with
a total size of almost 2 million hectares. Over 1.3 million hectares were granted by
the Ministry of Agriculture, Forests, and Fisheries to 122 companies, while 618,500
hectares were granted by the Ministry of Environment to 108 companies, the report
said. Directive 001 (also known as Order 01BB) on ‘Measures to strengthen and en-
hance the effectiveness of management of economic land concessions (ELCs)(http://
www.mlmupc.gov.kh/mlm/imgs/20130213%20Manual%20for%20Implementing%20
Govt%20Order%2001_ENG.pdf).
74. ‘Walkout at wage talks’, Phnom Penh Post, 8 October 2015.
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vietnaM 2014-2015: the strengthening oF relations
between vietnaM and the united states
Michela Cerimele
University of Naples L’Orientale
michela.cerimele@gmail.com
The strengthening of Vietnam-US relations in recent years has been one of the most
interesting traits of the so-called US Pivot to Asia. Such a strengthening needs to
be understood at the intersection between geopolitical and geo-economic factors and
in triangulation with the rise of China. While in many regards the emerging of
Vietnam as a privileged interlocutor of US attempts at «disciplining» China is a
fascinating historical development, it also entails important elements of historical
continuity. Interestingly, the evolution of Vietnam-US relations in the two years
2014-2015 – which have been characterized by important developments in both
military, economic and political terms – show both faces of this coin. Going through
these recent evolutions is a particularly fascinating exercise in light of the series of
historically significant anniversaries that marked 2015.
1. Introduction
2015 was the fiftieth anniversary of the official beginning of the Ameri-
can war in Vietnam, the fortieth anniversary of the liberation of Saigon by
Northern Communist troops, and the twentieth anniversary of the normali-
zation of relations between the US and this Southeast Asian state. Amidst
this coincidence of highly symbolic anniversaries, it seems fitting to make
an assessment of the more recent state of Vietnam-US relations. Indeed,
the two years 2014-2015 saw an unprecedented strengthening of bilateral
ties, well reflected in the intensification of high-level visits and exchanges
of political leaders. In what follows, we first propose a brief historical over-
view of Vietnam-US relations, paying attention to how they fit into the US’s
so-called Pivot to Asia. Launched by Obama’s administration in 2009, the
Pivot is a project substantially in continuity with a long history of US aspi-
ration to world hegemony. As has been aptly noted, this project certainly
can be read in the light of Beijing’s geopolitical and geo-economic rise.
However, more than being merely aimed at containing Chinese power, its
true stakes seem to concern the writing of the global rules, and who should
be in charge of doing so.1 We will then look at some key developments of
the two years 2014-2015, namely: (a) The crisis that occurred between Viet-
1. Francesca Congiu, ‘China and the Pivot to Asia’, Asia Maior 2014, pp. 15-40.

Michela ceriMele
nam and China over the Haiyang Shiyou-981 oil rig in spring 2014, which
strengthened Hanoi’s reasons for intensifying its relations with the US; (b)
The partial lifting of the US embargo on lethal weaponry that had been
imposed on Vietnam in 1975, and the prospects this opened up in terms
of military cooperation; (c) The conclusion of negotiations for the Trans-
Pacific Partnership (TPP), of which Vietnam became part not least thanks to
US support. In the final section we propose an assessment of the role that
the highly contested issue of human rights – which has historically perme-
ated US-Vietnam relations – concretely played in mediating the most recent
developments between the two countries.
2. An overview
Obama’s Pivot to Asia has hinged on three main objectives.2 The first
is that of guaranteeing American interests in the «economic driver of the
world».3 The TPP – the Pivot’s economic pillar – covers a region producing
40% of global GDP. Far beyond trade relations alone,4 the «US friendly»
free trade agreement concerns the regulatory frameworks of the 12 member
states in areas as diverse as intellectual property rights, the environment,
labour standards, and the role of State-Owned Enterprises (SOEs) in the
economy.5 Secondly, the Pivot aims at increasing the US military presence
in the Asia-Pacific; strengthening its already-existing alliances and strategic
partnerships; and creating new ones.6 One of the main US focuses, here –
also driven by the need to check China’s growing assertiveness in the East
and South China Sea – is that of guaranteeing the security and «freedom
of the seas», and the respect for international law, in a major crossroad of
2. Fabio Mini, ‘Quel che l’America non capisce dell’Asia’, in Il Vietnam fra Cina e
USA, Limes, No. 8, September 2015, p. 14.
3. Namely in one of the world’s leading economic regions. See ‘Carter Discusses
Military Rebalance to Asia-Pacific’, DoD News, Defense Media Activities, 6 November 2015.
4. The TPP sets out the elimination or gradual reduction of over 18,000 tariffs
between the participating countries, see The White House, Office of the Press Secre-
tary, Fact-Sheet: How the Trans-Pacific Partnership (TPP) Boosts Made in America Exports,
Supports Higher-Paying American Jobs, and Protects American Workers, 5 October 2015
(https://www.whitehouse.gov/the-press-office/2015/10/05/fact-sheet-how-trans-pacific-
partnership-tpp-boosts-made-america-exports).
5. Michela Cerimele, ‘Il 2013 vietnamita tra liberismo economico e autoritari-
smo politico: l’anno dei paradossi’, Asia Maior 2014, pp. 303-328.
6. S. D. Muni, ‘Introduction’, in S. D. Muni & Vivek Chada (eds.), Asian Strategic
Review 2014. US Pivot and Asian Security, Institute for Defence Studies and Analyses,
New Delhi: Pentagon Press, 2014, p. 150.
266
Vietnam 2014-2015
world trade.7 The Pivot’s third objective is the promotion of US values in the
region, including prosperity and democratic freedoms.8
It is within this schema that Vietnam has definitively re-emerged from
the «periphery of the world»,9 this time as a privileged interlocutor of the
United States. At the turn of the 20th century, China was already identified
as a fundamental pillar of the US’s «long-term project of a capitalistic world
order».10 It was especially with China’s loss to Communism that Vietnam
– as part of a Southeast Asian region now even more strategic in terms of
markets and raw materials11– started to move towards becoming, in Ameri-
can eyes, the world’s «belly-button».12 It was an arena in which America’s ca-
pacity to guarantee the victory of freedom and democracy, as well as its own
credibility, would ultimately be tested. Accordingly, the Communists’ seizure
of Saigon in April 1975 marked one of the US’s sharpest military and politi-
cal defeats. This was soon followed by the Ford administration’s extension
to the whole country of the «total embargo on transactions» already applied
to North Vietnam.13
Interestingly, the Vietnam conflict largely explains the emergence of
the «human rights» language in US foreign policy in the 1970s.14 Vietnam
7. The US Defense Department’s understanding of the notion of «freedom of

the seas» is: «all of the rights, freedoms, and lawful uses of the sea and airspace, in-
cluding for military ships and aircraft, recognized under international law»; Depart-
ment of Defense of United States of America, Asia-Pacific Maritime Security Strategy.
Achieving U.S. National Security Objectives in a Changing Environment, 27 July 2015, p. 2
(http://www.defense.gov/Portals/1/Documents/pubs/NDAA%20A-P_Maritime_Securi-
tY_Strategy-08142015-1300-FINALFORMAT.PDF).
8. Fabio Mini, ‘Quel che l’America non capisce dell’Asia’, p. 14; Office of the
United States Trade Representative, TPP Made in America Standing Up for Human
Rights, undated (https://ustr.gov/sites/default/files/TPP-Standing-Up-for-Human-
Rights-Fact-Sheet.pdf).
9. Pietro Paolo Masina, La Cina e le Nazioni Unite. Dall’esclusione al potere di veto,
Roma: Carocci, 2012, p. 161.
10. Francesca Congiu, ‘China and the Pivot to Asia’, p. 15.
11. Not least as the spread of communism could have eventually caused even
Japan – now the Asian pillar of the US’s view of an integrated world capitalist econ-
omy – to fall into the communist camp. For this specific interpretation of the root
causes of US involvement in Vietnam, see Joyce Kolko & Gabriel Kolko, The Limits of
Power: The World and United States Foreign Policy, 1945-1954, New York: Harper and
Row, 1972.
12. Carlo Pinzani, Da Roosevelt a Gorbaciov. Storia delle relazioni tra Stati Uniti e
Unione Sovietica nel dopoguerra, Firenze: Ponte delle Grazie, quoted in Pietro Paolo
Masina, La Cina e le Nazioni Unite, p. 161.
13. Committee on Ways and Means US House of Representatives, Overview and
Compilation of U.S. Trade Statuses Part I of II, Washington: U.S. Government Printing
Office, December 2010, p. 266.
14. On the function performed in the Seventies by human rights in «reclaiming
American virtue», see Barbara J. Keys, Reclaiming American Virtue. The Human Rights
Revolution of the Seventies, Cambridge: Harvard University Press, 2014.
267
Michela ceriMele
was nonetheless still the victim: intertwining with accusations related to

what has been defined the «POW/MIA myth»,15 human rights considera-
tions contributed to the strengthening and «multilateralization»16 of the
already harsh 1975 embargo. Washington’s normalization of relations with
Beijing; the blind eye it turned to the Khmer Rouge’s genocide; the defini-
tive isolation of Vietnam by the US (and its allies) following the intervention
in Cambodia (1978), all well reflected the ambiguous role human rights
played in American foreign policy – even at their apex, during the Carter
administration. The embargo was definitively lifted by Bill Clinton in 1994
and the normalization of relations was announced in 1995 – some years af-
ter the launch (April 1991) of George H. W. Bush’s «roadmap for normaliza-
tion» and the Paris Peace Agreements, in 1991. By that time a compromise
had been found between the pressure exerted by a US business community
wanting to enter the Vietnamese market and the forces opposing the lifting
of the embargo, in the name of the continuously re-emerging POW/MIA is-
sue.17 One landmark of the strengthened economic relations was the sealing
of a Bilateral Trade Agreement (BTA), coming into effect in 2001. Agreed in
exchange for Vietnam’s improved market reforms, the BTA was followed by
a series of US anti-dumping actions against the South-east Asian country.18
Rapidly growing since then, bilateral trade has indeed been characterised
by a persistent US trade deficit.19 The intensification of economic and trade
relations has proceeded notwithstanding the question of human rights in
15. On the understanding of the issue of the American Prisoners of War and
Missing in Action as a «myth», including its function in morally legitimizing both
the war and the embargo, «de-humanizing the Vietnamese», see Edwin A. Martini,
Invisible Enemies: The American War on Vietnam, 1975-2000, Amherst: University of
Massachusetts Press, 2007, especially Ch. 2; quotations, p. 43.
16. Washington’s ban on International Financial Institutions’ assistance to Viet-
nam dates to 1977.
17. Edwin A. Martini, Invisible Enemies: The American War on Vietnam, 1975-2000.
18. US granted Vietnam the status of conditional Normal Trade Relations
(NTR) (formerly MFN: Most Favoured Nation) with the BTA, and then that of Perma-
nent Normal Trade Relations (PNTR) (2006) within the framework of its accession to
the World Trade Organization (2007). The Asian country had previously been denied
non-discriminatory trade relations as a subject to the Title IV of the 1974 Trade Act,
including its human rights-related Jackson-Vanik amendment (section 402). How-
ever, as per the WTO bilateral agreement, the US continues to designate Vietnam
a «non-market economy». This facilitates the application of anti-dumping measures
against the country’s exports. On the BTA, and more generally on US-Vietnam trade
relations, see Michael F. Martin, U.S.-Vietnam Economic and Trade Relations: Issues for
the 113th Congress, Congress Research Service, 13 August 2014 (https://www.fas.org/
sgp/crs/row/R41550.pdf) and Michael F. Martin, U.S.-Vietnam Economic and Trade Re-
lations: Issues for the 112th Congress, Congress Research Service, 27 December 2010
(http://www.isn.ethz.ch/Digital-Library/Publications/Detail/?lang=en&id=126058).
19. United States Government Accountability Office, Southeast Asia: Trends in
U.S. and Chinese Economic Engagement in Indonesia and Vietnam, October 2015 (http://
www.gao.gov/assets/680/673422.pdf).
268
Vietnam 2014-2015
Vietnam – even though Washington has identified this as one of the most
problematic aspects of restored links. In the first years of post-normaliza-
tion, human rights-related criticisms still significantly overlapped with pro-
tracted accusations related to the American POWs/MIAs. Until recent times,
indeed, the human rights issue seems to have served to perpetuate the US’s
long-term discourse on Vietnam’s «moral unaccountability»20 – sometimes
compounded by the theme of its economic unreliability21 – while morally
legitimizing American global leadership aspirations.
Within the Pivot, Hanoi’s need to strengthen its own security in the
South China Sea – a constant source of tension between Vietnam and Chi-
na (who normalized relations with its South-east Asian neighbour in 1991)
– has played in Washington’s favour. The historic dispute over the Spratly
and Paracel Islands has re-emerged with particular vigour in the second
half of the 2000s, when, from the Vietnamese perspective, China has be-
gan to show an ever more aggressive attitude.22 Moreover, Vietnam’s rise
as an Asian «manufacturing hub»23 has paradoxically made it increasingly
economically dependent on China – from where it imports a large share of
intermediate goods, and with which it has a growing trade balance deficit.24
In Vietnam’s view, the TPP could help reduce such dependency, encouraging
foreign investors to produce intermediate goods directly in the South-east
Asian country, to be exported to big international markets such as the US.
More generally, Vietnam’s foreign-driven/export-oriented economic model
has made it increasingly dependent on widening export markets and on the
inflow of foreign direct investments. Conversely, beyond holding a strategic
geographic position, Vietnam has itself become one of the most dynamic
Asian economies – and a crucial destination for international manufacturers
20. Christina Schwenkel, ‘From John McCain to Abu Ghraib: Tortured Bodies
and Historical Unaccountability’, American Anthropologist, Vol. 111, No. 1, March 2009,
p. 31; by the same author, see also: The American War in Contemporary Vietnam: Trans-
national Remembrance and Representation, Bloomington: Indiana University Press, 2009.
21. It’s worth nothing that on account, among other things, of its designation
as a «Communist» country and poor labour rights record Vietnam is not considered
eligible for the US Generalized System of Preferences (GSP), according to the criteria
defined by the 1974 Trade Act; see, by Michael F. Martin: U.S.-Vietnam Economic and
Trade Relations: Issues for the 113th Congress, and U.S.-Vietnam Economic and Trade Rela-
tions: Issues for the 112th Congress.
22. Tran Truong Thuy, ‘Il torneo delle acque contese’, in Il Vietnam fra Cina e
USA, Limes, 2015, pp. 157-168; Le Hong Hiep, ‘Alleati Ombra Cercasi’, in Il Vietnam
fra Cina e USA, Limes, 2015, pp. 169-180.
23. Pietro P. Masina, ‘Vietnam tra Flying Geese e middle-income trap: le sfide
della politica industriale per una nuova tigre dell’Asia’, in L’industria, No. 4, 2012, pp.
705-736 and Pietro Paolo Masina, Il Sud Est Asiatico in trappola: Storia di un miracolo
mancato, Roma: Nuova Cultura, 2013.
24. Both the US trade deficit with Vietnam and Vietnam’s trade deficit with China
have intensified in recent years, seeUnited States Government Accountability Office,
Southeast Asia: Trends in U.S. and Chinese Economic Engagement in Indonesia and Vietnam.
269
Michela ceriMele
especially on account of its low labour costs and strong incentives for foreign
direct investment (FDI) attraction. In 2015 the country saw a 6.68% GDP
growth, allowing it to hope that it could overtake China’s growth rate (6.9%)
in 2016.25 As of 2014, foreign investments made up almost 20% of the coun-
try’s GDP, 22% of total investments and two-thirds of merchandise exports.26
A recent turning point in Vietnam-US relations was 2013, marked by
the signing of a comprehensive partnership.27 In correspondence with ne-
gotiations over the TPP and the signing of this partnership, the question of
the state of civil, political and religious freedoms in Vietnam has overlapped
with a specific focus on labour rights.28Also permeated by this theme, the
two years 2014-15 simultaneously marked a transition to a qualitatively new
phase of post-normalisation. Before turning our attention to the key mo-
ments underlying this acceleration – and to the concrete role played by hu-
man rights in mediating it – we will first offer a reflection on the triangular
Vietnam-China-USA connection.
An analysis of Vietnam’s own relations with China in the two years
under analysis is beyond the scope of the present study. However, it’s worth
highlighting that as of 2015 Beijing still was a strategically important part-
ner of Hanoi. As has been suggested, the Southeast Asian economy has
systematically pursued a «policy of cooperation and struggle» with both US
and China.29 This orientation is part of wider foreign policy goals framed in
terms of the «multilateralization» and «diversification» of external relations,
and function of the preservation of «independence» and «self-reliance».30
It will be interesting to assess, from this point of view, the outcomes of the
25. ‘Vietnam Could Beat China on GDP Growth in 2016: expert’, Tuoi Tre News,
2 January 2016.
26. The World Bank, Taking Stock. An Update on Vietnam’s Recent Economic De-
velopments, December 2014, p. 16 (http://www-wds.worldbank.org/external/default/
WDSContentServer/WDSP/IB/2014/12/01/000469252_20141201111605/Rendered/
PDF/928250WP0P13240g0Stock0Dec020140ENG.pdf).
27. Michela Cerimele, ‘Il 2013 vietnamita tra liberismo economico e autorita-
rismo politico’.
28. Ibid.
29. Carlyle A. Thayer, ‘Not Too Hot, Not Too Cold. A Vietnamese Perspective
on China-U.S. Relations’, Paper Presented to International Conference on China-US Rela-
tions in Global Perspective, New Zealand Contemporary China Research Centre, Victo-
ria University of Wellington, New Zealand, 8-9 October, 2015, p. 2.
30. Ibid. This approach dates back to the late Eighties/early Nineties. For an
account of Vietnamese foreign policy’s evolutions from then to the present day, see
also: Carlyle Thayer, ‘Vietnamese Diplomacy, 1975-2015: From Member of the So-
cialist Camp to Proactive International Integration’, Presentation to International Con-
ference on Vietnam: 40 Years of Reunification, Development and Integration (1975-2015),
Thu Dau Mot University, Binh Duong province, Viet Nam, April 25, 2015 and Carlyle
A. Thayer ‘Multilateralism and the Threat of Peaceful Evolution’, in Carlyle A. Thayer
& Ramses Amer (eds.), Vietnamese Foreign Policy in Transition, Singapore: Institute of
Southeast Asian Studies, 1999, pp. 1-24.
270
Vietnam 2014-2015
Vietnamese Communist Party’s (VCP) Twelfth Congress,31 whose prepara-

tory work has been marked by intense infighting, not least regarding the
country’s foreign policy orientations. For several years the VCP’s internal
struggles have anticipated important changes, both domestically and on the
international political terrain.32
3. The Haiyang Shiyou-981 crisis
An important catalyst for the recent intensification of bilateral rela-

tions between Vietnam and the US was the unprecedented deterioration of
Hanoi’s relations with Beijing in the spring of 2014, when China deployed
the massive oil rig Haiyang Shiyou-981 in disputed waters surrounding the
Paracel Islands. The crisis happened in the context of the noticeable inten-
sification of Chinese interest and activities in the South China Sea under Xi
Jinping’s presidency.33 Among other things, since 2013 Beijing has started
to rapidly intensify land reclamation activities in the South China Sea and
turn the Spratly land formations into artificial islands equipped with both
civilian and military infrastructure. Far wider in scope than the building
activities mounted by any other contending country, Chinese manoeuvres
have appeared to aim at increasing its capacity to control the Sea – indeed,
potentially overwhelmingly so.34
The Haiyang Shiyou-981 events apparently ended with the restoration
of Vietnamese-Chinese relations practically in the same state as they had been
before the crisis broke out.35 Nonetheless, they decisively dented Hanoi’s con-
fidence in Beijing, strengthening its reasons to intensify its relations with the
United States. Not only did the dispute over the oil rig put Vietnam face-
to-face with the levels of aggression that China can reach, and indeed «the
enormous disparity in the two countries’ power and capabilities».36 It also
shed further light on the possible economic and domestic political implica-
tions of the problem of maritime security.37 Overall, the Haiyang Shiyou-981
affair substantially reinforced the perception that China represents a threat to
31. Scheduled for 20-28 January 2016.

32. Internal struggles have actually characterized the whole history of VCP and
especially the cold war period, with foreign policy having been a particularly burning
issue. See, for instance, D. E. Pike, History of Vietnamese Communism, 1925-76, Stanford,
Cal.: Hoover Institution Press, 1978.
33. Mu Chunshan, ‘Il sottile gioco della Russia’, in Limes, No. 8, 2015, p. 53.
34. Department of Defense of United States of America, Asia-Pacific Maritime
Security Strategy. Achieving U.S. National Security Objectives in a Changing Environment,
pp. 15-17; Tran Truong Thuy, ‘Il torneo delle acque contese’, p. 159.
on China-U.S. Relations’.
36. Le Hong Hiep, ‘Alleati Ombra Cercasi’, p. 172.
37. Tran Truong Thuy, ‘Il torneo delle acque contese’.
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Michela ceriMele
Vietnam’s autonomy, security and political-economic stability. We will go on to

briefly recount the most important moments of the crisis.
On 2 May 2014 the China National Offshore Oil Corporation (CNOOC)
positioned the Haiyang Shiyou-981 oil rig within Vietnam’s exclusive econo-
mic zone, about 120 miles from its coast and close to the Paracel Islands. On
3 May, the China Maritime Safety Administration’s website noted that the
Haiyang Shiyou-981 oil rig was to conduct drilling operations from 4 May to
15 August 2014, and forbade the presence of ships within a one-mile radius of
the rig (soon after extended to three). On 5 May Hanoi demanded the remo-
val of the rig and declared Beijing’s manoeuvres «illegal».38 From the outset,
China’s move was marked by an unprecedentedly muscular approach. Beijing
unilaterally entered another state’s Exclusive Economic Zone (EEZ) for the
first time39– and it did not hesitate to actively defend the Haiyang Shiyou-981
oil rig area. In fact, according to Hanoi, already within the first week after the
oil drill was placed in the disputed waters, China took recourse to ramming
and the use of water cannons to push away Vietnamese vessels, damaging
them and causing injuries to several of their crew members.40 Vietnamese
authorities denounced the provocative aspects of Beijing’s move, and its di-
sregard for all previous agreements on maritime issues. In the words of the
Vice Chair of the Vietnamese National Boundary Commission, Tran Duy Hai:
This is clearly an intentional act, seriously violating the sovereign
rights and jurisdiction of Viet Nam over its Exclusive Economic Zone
and continental shelf. It also infringes upon the relevant provisions of
the international law, including the 1982 UNCLOS and runs counter
to the spirit and language of the DOC. China’s actions run counter to
the agreements and common understanding between the two countri-
es’ leaders, particularly the agreement on the basic principles guiding
the settlement of maritime issues between Viet Nam and China. 41
Beijing, for its part, justified its recourse – with the «utmost restraint»42
– to water cannons as a response to some 171 Vietnamese attacks in its own
territorial waters between 2 and 7 May 2014.43In late May, a Vietnamese fi-
38. ‘Vietnam says China’s oil rig movement into Sth China Sea is «illegal»’, Reu-
ters, 5 May 2014.
39. Carl Thayer, ‘China’s Oil Rig Gambit: South China Sea Game-Changer?’,
The Diplomat, 12 May 2014.
40. ‘Vietnamese ship return water cannon fire with Chinese’, Thanh Nien News,
13 May 2014; ‘Viet Nam pledges all efforts to protect territorial waters’, Viet Nam
News, 8 May 2014.
41. ‘Viet Nam pledges all efforts to protect territorial waters’.
42. Jonathan Kaiman, ‘China accuses Vietnam of ramming its ships in South
China Sea’, The Guardian, 8 May 2014.
43. ‘Commentary: Vietnamese harassment disrupts, complicates South China
Sea Situation’, Xinhuanet News, 11 May 2014; Jane Perlez and Rick Gladstone, ‘China
Flexes Its Muscles in Dispute With Vietnam’, The New York Times, 8 May 2014.
272
Vietnam 2014-2015
shing vessel sank around 17 miles from the oil rig, following a collision with
a Chinese one. The clash led to mutual accusations of responsibility for the
incident, and a further escalation of tensions.44 Beijing seemingly deployed
some 80 vessels in defence of the rig, including fishing vessels, coast guard
ships and seven warships – as well as some military jets. Hanoi reacted with
a few dozen coast guard and fisheries surveillance vessels.45
During the second week of May 2014, as the Haiyang Shiyou 981
crisis was heating up and the VCP appeared divided on the approach to
take toward China,46 a wave of unrest broke out in the country. A first wave
of peaceful anti-Chinese demonstrations was followed by violent riots in
the industrial parks of the southern areas of Binh Duong, Ho Chi Minh
City and Dong Nai. Over 300 businesses – whether owned by Chinese or
other foreign (mostly Asian) capital – were attacked, looted and destroyed.47
Workers were apparently involved in initially peaceful demonstrations by
organized groups of unemployed migrant workers (who had earlier been
laid-off), who went on to engage in violence.48 In Binh Duong province –
from where the riots spread, involving some 20,000 protesters – authorities
reported the burning of 15 factories and enormous economic damage.49
Riots also spread to central Vietnam, leading to the burning of the giant
Taiwanese-owned «Formosa Plastics» and to the death of one Chinese wor-
ker and several dozens of injuries. 50
This «dark chapter in Sino-Vietnamese relations»51 brought about the
temporary closure of a series of foreign businesses, job losses, a drop in tou-
rism, serious economic damage and damage to the country’s image, as well
as difficulties in maintaining order.During these days, investor countries
called on Vietnam to restore order and protect their citizens, condemned
44. ‘China, Vietnam Blame Each Other for Fishing Boat Sinking’, VOA News,
27 May 2014.
45. Le Hong Hiep, ‘Alleati Ombra Cercasi’, p. 172; ‘Vietnamese ship return
water cannon fire with Chinese’; Ankit Panda, ‘1 Year Later: Reflections on China’s
Oil Rig Sovereignty-making in the South China Sea’, The Diplomat, 12 May 2014; Carl
Thayer, ‘China’s Oil Rig Gambit: South China Sea Game-Changer?’.
on China-U.S. Relations’.
47. Ivan Franceschini, ‘Interview with Angie Ngoc Tran’, New Mandala, 29
July 2014; Huong Le Thu, ‘The Anti-Chinese Riots in Vietnam: Responses from the
Ground’, ISEAS Perspective, No. 32, 27 May 2014.
48. Ivan Franceschini, ‘Interview with Angie Ngoc Tran’.
49. ‘Vietnam mobs set fire to foreign factories in anti-China riots’, Reuters, 14
May 2014.
50. According to Vietnamese informal sources, riots brought up to 21 dead,
seemingly five Vietnamese and 16 Chinese. ‘Up to 21 dead, doctor says, as anti-China
riots spread in Vietnam’, Reuters, 15 May 2014; ‘At least 21 dead in Vietnam anti-Chi-
na protests over oil rig’, The Guardian, 15 May 2014.
51. Ian Storey quoted in ‘Vietnam mobs set fire to foreign factories in anti-Chi-
na riots’.
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Michela ceriMele
the incidents, and also highlighted the possible negative consequences they
might have for future investment decisions. The Vietnamese authorities,
on their part, worked to reassure investors, restore order and offer econo-
mic support for the damage suffered. China did not hesitate in blaming
the Vietnamese authorities for sparking and then mishandling the disorder,
and evacuated thousands of its own citizens. 52
During this first month of clashes Beijing apparently rebuffed all
Vietnamese attempts to resolve the tensions via negotiation. The clashes
also continued into June 2014, which saw the failure of the first diplomatic
meeting between the two countries since the crisis first exploded. On 10
June 2014 the Chinese State Councillor Yang Jiechi met the Vietnamese
Foreign Minister Pham Binh Minh and Prime Minister Nguyen Tan Dung
in Hanoi. The visit resulted in an exchange of accusations, with neither side
moving from their respective positions.53
Already in the days immediately following the explosion of the crisis,
the United States made its first official interventions in support of Vietnam.
On 7 May 2014, a press statement by Jen Psaki, a spokesperson for the State
Department, declared the Chinese manoeuvre «provocative» and expressed
US concerns «about dangerous conduct and intimidation in this area».54 On
10 July, a Senate resolution (S.RES.412) reasserted US support for freedom
of navigation and the peaceful resolution of territorial and maritime dispu-
tes in the region; it condemned the recourse to intimidation and coercion;
it highlighted China’s violation of international law; and it called on Beijing
to return to the situation that had existed prior to the oil rig crisis breaking
out.55 The following day, deputy assistant secretary of state for Strategy and
Multilateral Affairs Michael Fuchs reaffirmed US concerns over Beijing’s
«provocative and unilateral» behaviour. 56
52. Ibid.; Ivan Franceschini, ‘Interview with Angie Ngoc Tran’; ‘Vietnam to Pro-
vide Economic Assistance to Foreign Firms Affected by Recent Riots’, Vietnam Briefing,
23 May 2014; ‘Vietnam stops anti-China protests after riots, China evacuates work-
ers’, Reuters, 18 May 2014; ‘China foreign minister condemns Vietnam over riots’,
Reuters, 15 May 2014; ‘At least 21 dead in Vietnam anti-China protests over oil rig’;
‘China, Targeted by Vietnamese in Fiery Riots’, The New York Times, 14 May 2014;
‘Fifteen factories set on fire in protest as Vietnamese ships confront Chinese oil rig in
disputed waters’, National Post, 14 May 2014.
53. ‘For Vietnam and China, No Easing of Tensions’, The New York Times, 18
June 2014.
54. Jen Psaki, Department Spokesperson, U.S. Department of State, Vietnam/
China: Chinese Oil Rig Operations near the Paracel Islands, Press Statement, Washington,
DC, 7 May 2014 (http://www.state.gov/r/pa/prs/ps/2014/05/225750.htm).
55. ‘US Senate passes resolution on East Sea’, Vietnam Plus, 11 July 2014.
56. ‘RPT-U.S. wants freeze on acts stocking South China Sea tensions’, Reuters,
11 July 2014.
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Vietnam 2014-2015
On 15 July 2014 the oil rig was unilaterally withdrawn, earlier than
it was previously announced.57 This was officially justified as marking the
conclusion of the exploratory operations and the identification of «signs of
oil and gas».58 The Chinese Foreign Ministry again declared that the Paracel
Islands belonged to Chinese territory, while also defending the legitimacy
of Beijing’s «safety of operations» around the oil rig.59 It also remarked that
the platform had been moved in correspondence with the implementation
of commercial strategies, and not because of «outside factors».60 After the
oil drill was removed China continued its land reclamation and building
activities in the Spratly Islands, reaching 2,900 acres in June 2015 according
to US Defense Department data.61
4. From the Haiyang Shiyou-981crisis to the lifting of the weapons embargo
Among other things, the Haiyang Shiyou-981 crisis accelerated the

already repeatedly-heralded US decision to relax its embargo on the sale
of lethal weapons to Vietnam. The related announcement was made on 2
October 2014, upon the occasion of a bilateral summit between Secretary
of State John Kerry and his Vietnamese counterpart Pham Binh Minh in
Washington. The Vietnamese minister had apparently declined an invitation
from Kerry in May, considering the meeting «too sensitive» in light of the af-
fair over the oil rig. The summit’s objective was to assess the evolution of bi-
lateral relations within the US-Vietnam comprehensive partnership – which
had also foreseen the creation of a ministerial-level mechanism to this end. 62
Already in the first days of August, the Republican senator and war
veteran John McCain, visiting the Vietnamese capital together with senator
Sheldon Whitehouse, reiterated his support for lifting the embargo and for
accelerating military and economic cooperation.63 That same month, Ge-
57. ‘China’s oil rig moving to Hainan: Vietnam Coast Guard command’, Thanh
Nien News, 6 July 2014.
58. ‘Chinese oil rig near Vietnam to be moved’, The New York Times, 15 July
2014.
59. Ibid.; ‘China-Vietnam Tensions May Ease as Oil Rig Leaves Contested Wa-
ters’, The Wall Street Journal , 16 July 2014.
60. ‘China says oil rig in contested waters not moved due to outside factors’,
Reuters, 16 July 2014.
61. Department of Defense of United States, Asia-Pacific Maritime Security Strate-
gy. Achieving U.S. National Security Objectives in a Changing Environment, p. 16.
62. Carl Thayer, ‘The US Lifts Arms Embargo: The Ball Is in Vietnam’s Court’,
The Diplomat, 6 October 2014.
63. ‘Vietnamese PM receives US Senators’, Vietnam News, 11 August 2014; ‘U.S.
likely to lift lethal weapon ban on Vietnam next month: Senator’, Tuoi Tre News, 9
August 2014; ‘McCain confident of support for easing arms embargo on Vietnam’,
Reuters, 8 August 2014.
275
Michela ceriMele
neral Martin Dempsey made a visit to Hanoi to discuss the strengthening of

military cooperation. He was the first chairman of the Joint Chiefs of Staff
to visit Vietnam since 1971.64
The ban on the sale of weapons to Vietnam dated back to the 1975 em-
bargo. In 1984, Vietnam was further included among the countries subject to
the restrictions set out by the ITAR (International Trafficking in Arms Regula-
tion). The weapons embargo remained in place even after 1994, with its lifting
conditional on Vietnam progress concerning the country’s human rights si-
tuation. In 2007, a first amendment to the ITAR allowed, on a case-by-case ba-
sis, the export or import of non-lethal defence articles and defence services.65
The partial lifting of the ban, announced in October, remained limited
in scope. The United States emphasised that this measure reflected certain
noticeable improvements in Vietnam’s human rights situation – including
the release of some political prisoners – and that the future pace of military
relations would remain conditional on «continued progress» in this field.66
Adopted in November 2014, the new amendment to ITAR allowed the sale
to Vietnam – on a case-by-case basis – of lethal defence articles and defence
services aimed at enhancing maritime capabilities and domain awareness.67
Not without a certain symbolic value of its own, this decision opened the way
to further important developments.
One significant shift was the meeting between US Defense Secretary
Ashton Carter and his counterpart General Phung Quang Thanh in Hanoi
on 1 June 2015. A month from the fortieth anniversary of the loss of Sai-
gon, the United States promised to transfer Vietnam some US$18m for the
purchase of American Metal Shark patrol vessels, in support of the country’s
maritime defence capabilities.68 Carter’s visit to Vietnam was part of a wider
11-day tour across Asia, during which he also took part in the annual Shan-
gri-la Dialogue in Singapore. He here confirmed Washington’s interest in
strengthening Southeast Asian countries’ maritime capacity.69 He also reaf-
firmed the three cornerstones of the US’s latest position on the South China
Sea, which he had already announced in Hawaii some days previously.70
64. ‘Chairman of Joint Chiefs of Staff on 1st visit to Vietnam since 1971 amid
sea rift with China’, Fox News, 14 August 2014.
65. Department of State, ‘Amendment of the International Traffic in Arms Reg-
ulations: Policy with Respect to Vietnam’, Federal Register, Vol. 72, No. 63, 3 April 2007
(https://www.pmddtc.state.gov/FR/2007/72FR15830.pdf).
66. ‘U.S. Eases Embargo to Vietnam’, The New York Times, 2 October 2014.
67. Department of State, ‘Amendment to the International Traffic in Arms Reg-
ulations: Policy on Exports to Vietnam’, Federal Register, Vol. 79, No. 217, 10 Novem-
ber 2014 (https://www.pmddtc.state.gov/FR/2014/79FR66615.pdf).
68. ‘Carter: U.S., Vietnam Committed to Defense Relationship’, DoD News De-
fence Media Activity, 2 June 2015; ‘US Pledges $18 Million for Vietnam to Buy Patrol
Boats’, Voice of America, 1 June 2015.
69. Prashanth Parameswaran, ‘US Launches New Maritime Security Initiative at
Shangri-La Dialogue 2015’, The Diplomat, 2 June 2015.
70. Ibid.
276
Vietnam 2014-2015
To put it in Carter’s own words:

1. First, we want a peaceful resolution of all disputes and an immediate
and lasting halt to land reclamation by any claimant. […] We also oppo-
se any further militarization of disputed features; 2. Second and there
should be no mistake: The United States will fly, sail and operate whe-
rever international law allows, as we do all around the world; 3. With
these actions in the South China Sea, China is out of step with both
international norms that underscore the Asia-Pacific’s security architec-
ture, and the regional consensus in favour of non coercive approaches
to this and other long-standing disputes.71
The announcement in turn evoked Washington’s apparent intention
– disclosed by a Wall Street Journal report – to make recourse to «a more
robust approach in the South Chinese Sea», including «using aircraft and
Navy ships to directly contest Chinese territorial claims to a chain of rapidly
expanding artificial islands».72 Such intention provoked a sharp reaction
from Beijing,73 which it also reiterated at the Singapore security summit.74
In Hanoi, Carter also made an – only partially accepted – request to
his Vietnamese counterpart, asking for a halt to land reclamation and island
building in the South China Sea.75 In any case, the meeting between the
two ministers concluded with their co-signing of a Joint Vision Statement
(JVS), seeking to orient their bilateral defence relationships on the basis of
the Memorandum of Understanding on Advancing Bilateral Defense Coo-
peration already sealed in 2011.76 The JVS explicitly invoked the possibility
of «expan[ding] defence trade between our two countries, potentially inclu-
ding cooperation in the production of new technologies and equipment,
where possible under current law and policy restrictions».77
71. ‘Carter Urges Peaceful Resolution of South China Sea Disputes’, DoD News
Defence Media Activity, 27 May 2015.
72. Adam Entous, Gordon Lubold and Julian E. Barnes, ‘U.S. Military Propos-
es Challenge to China Sea Claims’, The Wall Street Journal, 12 May 2015; see also:
Prashanth Parameswaran, ‘How Would the US Challenge China in the South China
Sea?’, The Diplomat, 14 May 2015.
73. Shannon Tiezzi, ‘US Encroachments in the South China Sea: What Would
China Do?’, The Diplomat, 14 May 2015.
74. Prashanth Parameswaran, ‘US Launches New Maritime Security Initiative at
Shangri-La Dialogue 2015’.
75. ‘Vietnam, U.S. discuss land reclamation in South China Sea’, Reuters, 1 June
2015.
76. Preceded by the launching of a Defence Policy Dialogue, the 2011 MOU
identified 5 areas of defence cooperation: maritime security, search and rescue,
high-level dialogues, humanitarian assistance, and disaster relief and peacekeeping
operations. Murray Hiebert, Phuong Nguyen & Gregory B. Poling, A New Era in U.S.
Vietnam Relations. Deepening Ties two Decades after Normalization, Lanham: Rowman &
Littlefield, June 2014, pp. 5-6.
77. U.S.-Vietnam Joint Vision Statement on Defence Relations between the Department
277
Michela ceriMele
In filigree, the overall language of the JVS represented an indication

that the restrictions set out in the ITAR were about to be eliminated. This
probable development seemed to be confirmed in subsequent months by
Assistant Secretary for Arms Control Verification and Compliance Frank
A. Rose.78 It is worth noting, here, that the US defence industry has shown
increasing interest in the growing Vietnamese market, and more generally
in «capitaliz[ing] on regional anti-Chinese sentiment to boost sales».79 The
priority that Vietnam has itself attributed to modernising its own military
capacities has translated into a surge in military spending. According to
the Stockholm International Peace Research Institute, between 2005 and
2014 it rose by some 128%.80 In April 2015 the media widely reported the
staging of a meeting at the US embassy in Hanoi, seeking to promote the
sale of US defence firms’ articles to the Vietnamese military. The invitees
for this symposium – held a few days before the forty-year anniversary
of the liberation of Saigon – included contractors like Boeing Co., BAE
Systems Plc., Lockheed Martin Corp. and Honeywell International Inc.81
In the short term the US defence industry nonetheless seemed pro-
bably destined to play a limited concrete role in Vietnam. This owed not
least to factors of a legal, technical and strategic nature. First of all, the
restrictions set out by the ITAR still hung over the country. Secondly, the
still-inexpert Vietnamese may have faced difficulties accessing the Ame-
rican Foreign Military Sales procurement procedures – and integrating
US equipment and technology into Vietnam’s existing defence systems.82
Finally, although «the Haiyang Shiyou-981 drift» strengthened the argu-
ments for a closer alliance with the United States, it seemed probable that
Hanoi would continue to privilege its own strategic allies, including Rus-
sia, also on the military terrain.83
of Defence of the United States of America and the Ministry of National Defence of the Socialist
Republic of Viet Nam, 1 June 2015 (http://photos.state.gov/libraries/vietnam/8621/pdf-
forms/usvn_defense_relations_jvs2015.pdf).
78. ‘US considers fully lifting Vietnam arms embargo’, Talk Vietnam, 13 July
2015.
79. Jeremy Luedi, ‘Vietnam’s Defence Boom Entices Global Firms’, Global Risk
Insights, 5 August 2015.
80. Sam Perlo-Freeman, Aude Fleurant, Pieter D. Wezeman & Siemon T.
Wezeman, Trends in World Military Expenditure, 2014, SIPRI, April 2015 (http://books.
sipri.org/files/FS/SIPRIFS1504.pdf).
81. ‘Vietnam Goes Shopping for U.S. Military Hardware’, Bloomberg Business,
13 May 2015.
82. Eric Tegler, ‘The Practicalities of US Military Sales to Vietnam’, The Diplo-
mat, 5 August 2015; Ankit Panda, ‘US to Help Vietnam Bolster Maritime Security’,
The Diplomat, 2 June 2015.
83. Russia was the first country with which Vietnam closed a strategic partner-
ship, in 2001.For an overview of the series of strategic partnerships Vietnam signed
since mid-2000s with Western and Asian countries, including with major powers such
as Japan (2006), India (2007) and China (2008), as well as their evolutions, seeCarlyle
278
Vietnam 2014-2015
Historically one of the main arms suppliers to Vietnam since the end
of the war, as of 2015 Russia still provided the South-East Asian country with
90% of its military equipment.84 In 2009 Vietnam signed an agreement for the
supply of six Kilo-class submarines, with the penultimate vessel reaching Cam
Ranh Bay in February 2016.85 Moreover, Russia was already selling Vietnam
aircraft, and was helping the country to construct a nuclear power station.86
The developments that we have briefly related above have, in any case,
reconfirmed the substantial alignment of US and Vietnamese strategic in-
terests with regard to the South China Sea. This convergence was brought
into relief in Washington on 7 July, at the historic meeting between Presi-
dent Barack Obama and Vietnamese Communist Party’s General Secretary
Nguyen Phu Trong. Organised to mark twenty years since the normalisa-
tion of bilateral relations, during the summit the two leaders also reaffirmed
their mutual interest in taking forward their cooperation in areas already
identified by the comprehensive partnership, strengthening their bilateral
relations, and accelerating negotiations over the TPP.87 We will now turn
our attention to these negotiations, before returning, later in the chapter, to
some particularly telling aspects of the meeting between Obama and Trong.
5. The conclusion of the TPP negotiations
5.1. The US-Vietnam side-agreement on labour

The growing perception of a «Chinese threat» has pushed the Ameri-
can Congress to overcome its own reticence about a (partial) lifting of the
embargo on the sale of lethal weaponry to Vietnam. This decision has, no-
netheless, raised strong criticism in the world of campaigning and human
rights organisations as it has been deemed to decrease Washington’s capaci-
ty to influence Hanoi’s conduct with regard to civil and political liberties.88
Thayer, ‘Vietnamese Diplomacy, 1975-2015: From Member of the Socialist Camp to

Proactive International Integration’.
84. ‘Russia opposes militarization of sea disputes, continues arms support for
Vietnam’, Tuoi Tre News, 29 December 2015.
85. ‘5th Russian-built submarine arrives in Vietnam’, Thanh Nien News, 3 Feb-
ruary 2016.
86. John Boudreau, ‘Vietnam goes shopping for U.S. Military Hardware’.
87. Accompanied by a sizeable delegation, during his visit Trong participated
in a dense series of meetings with parliamentary, government, political and religious
representatives, as well as exponents of the Vietnamese community and US academic
and business figures. Carlyle A. Thayer, ‘Not Too Hot, Not Too Cold. A Vietnamese
Perspective on China-U.S. Relations’; ‘Overview of Party Chief ’s visit to the US’, Viet-
nam Net, 16 July 2015; ‘Party leader Nguyen Phu Trong holds talks with US President
Obama’, Viet Nam News, 8 July 2015.
88. See, for example, John Sifton, ‘Fixing the United States’ Human Rights Mis-
step with Vietnam’, The Diplomat, 8 October 2014.
279
Michela ceriMele
Backed by the Obama administration, Vietnam’s presence in the TPP

negotiations has also fed into a wider opposition to the agreement in the
US Congress. US legislators’ – and particularly Democrats’ – objections on
the specific Vietnamese case have overlapped with the criticisms levelled by
both human rights organisations and the world of trade unionism. Beyond
the question of human rights in general, these critiques have concerned the
theme of labour rights and the barriers to the constitution of independent
trade unions in Vietnam.89 The concerns in this regard have brought into
question – among other things – the possible repercussions that a deal with
a country hostile to labour rights like Vietnam might have for the levels
and quality of employment in the US. Hanoi’s presence in the negotiations
for the free trade area also intersected with discussions in Congress about
granting President Barack Obama the Trade Promotion Authority (TPA),
namely the (impermanent) power to negotiate a trade agreement, which
the Congress can then endorse or turn down, but cannot modify.90 The US
President ultimately obtained the TPA – not without difficulty, and with Re-
publican support proving decisive – in June 2015.91
Negotiations were also characterised by several reasons for appre-
hension and mutual pressure between Washington and Hanoi. Some main
fields where problems arose included the question – of particular interest
for the United States – of Vietnam’s adaptation to the agreement’s stand-
ards regarding SOEs, intellectual property rights and the «yarn forward»
rule.92 On their side, Vietnamese demanded special treatment for develop-
89. Subordinated by law to the Communist Party leadership, the Vietnamese

General Confederation of Labour (VGCL) is the only legally recognised trade union
in the country.
90. ‘Vietnamese Labor Leaders Urge Congress to Reject Obama’s Trade Agen-
da’, Huffpost Politics, 11 June 2015; Tom Malinowski, ‘TPP Will Help Workers in Viet-
nam Pursue Their Rights’, DipNote U.S. Department of State Official Blog, 9 June 2015;
‘Obama at Nike headquarters: why push trade deal at an outsourcing giant?’, The
Guardian, 8 May 2015; ‘Obama’s Scheduled Visit To Nike Has Trade Deal Skeptics
Scratching Their Heads’, Huffpost Politics, 6 May 2015; Charles Kernaghan, A Race
to the Bottom. Trans-Pacific Partnership and Nike in Vietnam, Institute for Global Labour
and Human Rights, April 2015 (http://www.globallabourrights.org/reports/docu-
ment/1504-IGLHR-TPP-Nike-Vietnam.pdf); ‘Obama Tries Tough Sale of TPP Trade
Deal to Fellow Democrats’, The Wall Street Journal, 17 April 2015. On The TPP and its
discontents in the US, see also: Michela Cerimele, ‘Il 2013 vietnamita tra liberismo
economico e autoritarismo politico’.
91. ‘Senate passes trade «fast track», handing Obama a major victory’, CNBC,
24 June 2015; ‘House of Representatives approves «fast track» trade bill on second
attempt’, The Guardian, 18 June 2015; ‘House Democrats rebuff Obama on trade,
delivering major defeat’, The Washington Post, 12 June 2015.
rismo politico’. According to the «yarn forward» rule, in order to benefit from tariff
reduction, a TPP country that exports apparel to other TPP markets is required to use
textile produced either locally or within the TPP area.
280
Vietnam 2014-2015
ing countries, while also noting the US tendency to privilege its own inter-
ests, without wanting to concede much to the other negotiating countries.93
Issues related to access to the respective markets also featured prominently
in bilateral talks. In any case, already in 2014 successive meetings between
Vietnamese Deputy Prime Minister Vu Van Ninh and US trade represent-
ative Michael Froman had expressed a common will to accelerate negotia-
tions and find agreement on the thorniest questions.94
The 12 member-countries concluded the negotiations for the TPP on
5 October 2015, following a complex process that had raised many difficul-
ties and taken more than five years.95 The text of the agreement, which up
till that moment had remained a secret,96 was made public on 5 November
201597 and formally signed in New Zealand on 4 February 2016.98 Vietnam
brought its own bilateral talks to a conclusion in August 2015.99 Nonethe-
less, the TPP still had to face the far from simple challenge of being rati-
fied by each member country. The United States – where the debate over
the TPP overlapped with the US presidential election campaign – was the
country where it seemed likely to face the greatest difficulties.100 It remained
uncertain whether Obama, confronted by a bipartisan opposition, would be
able to get Congress to ratify the TPP by the end of his term as president.101
The conclusion of the negotiations was ultimately accompanied by a
bilateral labour agreement between the United States and Vietnam.102 The
US’s overall goal in this side-agreement was to commit the Southeast Asian
country to adopt the necessary internal reforms to satisfy the standards set
out in the TPP. The TPP chapter on labour (no. 19) anchors all member
countries to the «core labour standards» identified in the 1998 ILO decla-
93. Michael F. Martin , U.S-Vietnam Economic and Trade Relations: Issues for the
113th Congress, pp. 3-4.
94. ‘Deputy PM visits US to further TPP talks’, Viet Nam News, 17 September
2014; ‘Vietnam, U.S. determined to conclude TPP talks successfully’, Tuoi Tre News,
22 October 2014.
95. ‘Trans-Pacific Partnership Is Reached, but Faces Scrutiny in Congress’, The
rismo politico’.
97. ‘TPP trade deal: text published online’, The Guardian, 5 November 2015.
98. ‘Trans Pacific Partnership trade deal signed in Auckland’, BBC News, 4 Feb-
ruary 2016.
99. ‘Vietnam completes TPP bilateral negotiations with US, Japan; finishes
talks with all parties’, Tuoi Tre News, 3 August 2015.
100. For an analysis of the two parties’ candidates’ positions on the TPP, see
‘2016 presidential candidates on the Trans-Pacific trade deal’, Ballotpedia. The Ency-
clopedia of American Politics, undated (www.ballotpedia.org).
101. Muftiah M. McMartin & Kaitlyn McClure, ‘What’s Next for TPP: Will Con-
gress Ratify in 2016?’, Global Policy Watch, 21 January 2016.
102. The US negotiated a bilateral side-agreement on labour also with Malaysia
and Brunei, countries similarly exhibiting very poor labour records.
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Michela ceriMele
ration on Fundamental Principles and Rights at Work: «freedom of asso-

ciation and effective recognition of the rights to collective bargaining; the
elimination of forced and compulsory labour, the abolition of child labour
and the elimination of discrimination in respect of employment and occu-
pation.» Moreover, chapter 19 sets out the adoption of several measures: a
first set guaranteeing «acceptable conditions of work related to minimum
wages, hours of work and occupational safety and health», a second one
«prevent[ing] the degradation of labour protections in export processing
zones», and a third one aimed at to «combat[ing] trade in goods made by
forced labour».103 Focused on the core labour standards mentioned above,
with particular attention to the question of unions’ independence, the
agreement provided for the possibility of technical assistance to Vietnam,
also allowing a certain flexibility in the timeframe within which the country
was to comply with its requirements.104 On a more general level, Vietnam
appears to have obtained margins of flexibility and promises of technical
assistance from both the United States and the other member countries –
including with respect to thorny issues like SOE reform, open procurement
and intellectual property rights.105
5.2. Vietnam’s and the US’s converging interests in the TPP

Vietnam’s interest in the TPP is easily understood in terms of the pre-
dictions that accompanied the conclusion of the negotiations.106 The most
cited of these include Eurasia Group’s estimate of a 11% increase in the
Vietnamese GDP within ten years of the agreement’s implementation – a
«percentage increase» that «dwarfs the gains made by any other country» –
and a likewise considerable increase in exports, of 28%. More particularly,
a 50% increase was predicted – again, the highest in the whole free-trade
area – for the garment and footwear sectors, mostly to the disadvantage
103. Office of the United States Trade Representative, TPP Made in America Pro-
tecting Workers, undated (https://ustr.gov/sites/default/files/TPP-Protecting-Workers-
Fact-Sheet.pdf); International Labour Organization, ILO Declaration on Fundamental
Principles and Rights at Work, (http://www.ilo.org/declaration/lang--en/index.htm).
104. Office of the United States Trade Representative, United States – Viet Nam
Plan for the Enhancement of Trade and Labour Relations, November 2015 (https://ustr.
gov/sites/default/files/TPP-Final-Text-Labour-US-VN-Plan-for-Enhancement-of-
Trade-and-Labor-Relations.pdf).
105. ‘TPP Procurement: Vietnam’s Commitments’, Perspectives on Trade, 8 De-
cember 2015; Le Hong Hiep, ‘The TPP’s Impact on Vietnam: A Preliminary As-
sessment’, ISEAS Perspective, No. 63, 4 November 2015; ‘TPP Transition Periods on
Pharmaceutical Intellectual Property Rules’, Public Citizen, 9 October 2015 (https://
www.citizen.org/documents/TPPTransitionPeriodsonPharmaceuticals.pdf); Eurasia
Group, The Trans-Pacific Partnership: Sizing up the Stakes - A Political Update, New York:
Eurasia Group, 14 July 2015, p. 5.
106. For a first analysis of both the benefits and the possible costs of Vietnam
entering the TPP, see Le Hong Hiep’s paper quoted above.
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Vietnam 2014-2015
of China.107 Other export sectors expected to gain included agriculture,

aquaculture, seafood and forestry. Analyses have especially highlighted the
possibility for Vietnam to gain enhanced access to enormous markets like
the USA and Japan. Vietnam is one of the five countries in the area covered
by the TPP that does not already have a Free Trade Agreement (FTA) with
the United States.108
According to estimates, garment and textile – key sectors of the Viet-
namese economy – were likely to benefit most from the country’s entrance
into the TPP and the preferential access to the US market allowed by the
agreement.109 Between 2005 and 2015 Vietnam was continuously classified
as one of the world’s top ten garment and textile exporters, taking fifth
place in 2015.110 That year the United States was the Southeast Asian econ-
omy’s number one export market in these sectors, whereas Vietnam was
itself the second biggest net exporter to the US after China.111
American official reports have identified Vietnam as one of the most
interesting countries of the TPP’s area still lacking a US FTA.112 This owes
not least to Vietnam’s economic dynamism, the noticeable intensification of
bilateral trade relations, and their potential for growth. It has been noted
how the TPP could affect both Vietnamese tariff barriers relevant to US
interests and, as noted above, non-tariff barriers such as those associated
107. Eurasia Group, The Trans Pacific Partnership: Sizing up the Stakes - A Political
Update, pp. 8-9.
108. Le Hong Hiep, ‘The TPP’s Impact on Vietnam: A Preliminary Assessment’.
Note that in recent years Vietnam has also signed a raft of bilateral and multilateral
free trade agreements, opening the possibility for the country to gain greater access
to several key-world markets. In 2015 alone it concluded negotiations on another
highly important FTA with the European Union. That same year, Vietnam also signed
FTAs with South Korea and the Eurasian Economic Union, and was also negotiating a
Regional Comprehensive Economic Partnership (RCEP). For other details, ibid., p. 4.
109. The average tariff applied by the USA on garment and textile imports
from Vietnam was a rather high 17%, whereasthatencetionothnt TPP’sn Japan, more
than Malaysia?etween, on the one hand, the philosophical order of nature, and on
the otherthe implementation of the TPP would gradually bring this towards zero.
‘Le Tien Truong, Vice Chairman of Vitas and Ceo of Vinatex: Strengthening Supply
Chains, Raising Added Value and Increasing Localisation Rate’, VCCI News, 2 July
2015.
110. Vietnam Trade Promotion Agency, Garment, textile exports forecast to grow
11.5% a year to 2020, 29 December 2015 (http://www.vietrade.gov.vn). .
111. Vietnam Trade Promotion Agency, Textile and garment exports in 2015: prom-
ising outlook, 3 November 2015 (http://www.vietrade.gov.vn); ‘An Introduction to Viet-
nam’s Import & Export Industries’, Vietnam Briefing, 3 February 215.
112. Together with Japan – the most important TPP economy still lacking an
FTA with the United States – and Malaysia. See Ian F. Fergusson, Mark A. McMin-
imy & Brock R. Williams, The Trans-Pacific Partnership (TPP): in Brief, Congressional
Research Service, 9 February 2016, p. 2 (https://www.fas.org/sgp/crs/row/R44278.pdf).
283
Michela ceriMele
with the considerable role SOEs play in Vietnam’s economy.113 Once in ef-
fect, the TPP will, for example, allow US agricultural and food producers to
penetrate the highly promising Vietnam market. This will help strengthen
America’s competitiveness in these sectors, faced with the challenges deriv-
ing from other free trade agreements existing or currently being negotiated
in the region.114 Similarly, the removal of the duties on US auto parts will
improve US competitiveness as compared to countries that already have an
FTA with Vietnam, such as China, Thailand and Indonesia.115 Within the
limits of the flexibility measures set out for the country, the TPP will also
result in US access to the Vietnamese procurement market, and, as noted
above, in strong provisions on the protection of intellectual property rights
being extended to the country.116
We have mentioned in previous sections the TPP’s potential to decre-
ase Vietnam’s economic dependence on China. Nonetheless, in key sectors
like garments and textiles, both the possibility of increasing exports to the
US market and that of reducing Chinese imports depended on Hanoi’s abi-
lity to adjust to the «yarn forward rule». As of 2015, the Vietnamese garment
and textile industry was still heavily reliant on non-TPP member countries,
particularly China. The insertion of «yarn forward rule» into the agreement
was aimed at restructuring the regional supply-chains, to the advantage of
the member countries – not least the United States – and to the direct di-
sadvantage of non members countries, above all China. No doubt, the in-
clusion of the «yarn forward rule» creates important opportunities for US
textile producers to penetrate the Vietnamese market, both in terms of ex-
ports and investments.117
113. All aspects of interest to the US, common to both Vietnam and Malaysia. It
is worth noting that by 2015 both countries had the highest average tariffs on imports
of the TPP area. Ibid.
114. For example, Australia already has a free trade agreement with Japan. In
early 2016 FTAs were being negotiated between the EU and Malaysia and Japan.
Ibid., p. 5. As we have said, in 2015, negotiations were concluded for a free trade
agreement between the EU and Vietnam.
115. Office of the United States Trade Representative, Trans-Pacific Partnership:
Summary of U.S. Objectives, undated (https://ustr.gov/tpp/Summary-of-US-objectives).
116. Ian F. Fergusson, Mark A. McMinimy & Brock R. Williams, The Trans-Pacific
Partnership (TPP): in Brief.
117. ‘Gaining Access: How the TPP drives investment location decisions
through trade’, Tractus. Building Business in Asia, 14 January 2016 (http://tractus-asia.
com); ‘WB names Vietnam’s unique advantages in TPP’, Vietnam Breaking News, 14
December 2015; Chris Devonshire-Ellis, ‘The U.S. TPP «Yarn Forward» Program and
Implications for China & Vietnam’, China Briefing, 4 November 2015; Department of
Commerce of United States of America – International Trade Administration, 2015
Top Markets Report. Technical Textiles and Apparel. A Market Assessment Tool for U.S. Ex-
ports, July 2015, pp. 33-35 (http://trade.gov/topmarkets/pdf/Textiles_Top_Markets_
Report.pdf).
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Vietnam 2014-2015
Vietnam’s entrance into the TPP has also been deemed likely to bring
it a greater influx of foreign direct investment than any other member
country.118 Already before the negotiations were concluded, internation-
al garment and textile producers – both of Asian, including Chinese, and
American provenance – began to redirect investment flows toward Vietnam
or to increase existing ones, in expectation of the benefits associated with
Vietnam’s participation in the agreement. 119 Also predicted was a further
increase in the already extraordinary influx of foreign direct investment
in the Vietnamese electronics and IT sectors, coming from the biggest in-
ternational conglomerates. In recent years – not least in anticipation of its
entrance into the TPP – Vietnam has turned into a major production base
for giants like Samsung, Intel, and Microsoft. Since 2013, electronics have
become Vietnam’s leading export sector. Along with trade advantages that
Vietnam is foreseen to gain from participating in TPP, the low costs and
good quality of its labour have greatly contributed to making it one of the
most attractive Asian production bases and, at least in part, an alternative
to the increasingly more expensive China.120 In 2015, the US was only the
seventh investor in Vietnam (out of 103 countries and territories), though
this figure does not take account of investment by American enterprises
registered elsewhere.121 According to the Vietnam Association of Foreign
Investments predictions, the United States was nonetheless one of the TPP
area countries most interested in expanding its presence in Vietnam, with
important potentials «to rise to the top».122
6. Some reflections on the state of US-Vietnam bilateral relations

through the lens of human rights
As we mentioned above, the question of human (and labour) rights in

Vietnam featured prominently in US-Vietnam relations also in the two-year
period under examination. In the following sections, some reflection on the
role that this theme concretely played in mediating recent relations betwe-
118. ‘How Vietnam should ride the new foreign investment wave that comes
with TPP’, Thanh Nien Daily, 13 October 2015.
119. ‘Vietnam Expects Strong FDI Flow after TPP’, VCCI News, 2 December
2015; ‘Textile investments flow into Vietnam ahead of TPP’, Just-Style, 13 July 2015;
‘Foreign Textile Firms expand investment in Vietnam ahead of TPP enactment’,
Shanghai Daily, 4 July 2014.
120. HKTDC Research, ‘Vietnam, an Alternative Production Base: 2015 Up-
date’, 5 February 2015, pp. 1-2 (http://economists-pick-research.hktdc.com).
121. Ministry of Planning and Investment, Foreign Investment Agency, US
Investment in Vietnam, 13 July 2015 (http://fia.mpi.gov.vn/detail/3532/US-Invest-
ment-in-Vietnam).
122. ‘How Vietnam should ride the new foreign investment wave that comes
with TPP’.
285
Michela ceriMele
en the two «old enemies» will be offered. The analytical lens of «rights»
offers a particularly interesting perspective on at least two levels. On the
one hand, it allows us to evaluate the real state of the relations between the
two countries, on the fundamentally important political-ideological plane.
On the other hand, the theme of rights opens out onto reflection on some
of the concrete contents of the American «return» to Vietnam, and, more
generally, the US project of «global leadership». In this latter regard, we will
devote particular attention to the question of labour rights and standards,
which marked the TPP negotiations and closely concerned the Hanoi regi-
me. On this terrain we can take forward some of the observations already
made in a previous issue of Asia Maior.123
6.1. Convergences
Although as of 2015 the US’s persistent questioning of the state of hu-
man and labour rights in Vietnam was not without concrete implications, it
seems to have continued to play a mostly rhetorical role, legitimising its privi-
leged dialogue with Hanoi. Indeed, this marked an element of continuity with
the controversial relation between rhetoric and practice that has traditionally
underpinned Washington’s foreign policy on this theme. After all, the US
fought its Vietnam war not least in the name of democratic freedoms; and, on
the other hand, the US return to the country in the 1990s went ahead despite
the lack of such freedoms. A useful entry point for evaluating the most recent
state of relations between the two countries on the ideological-political plane
are two of the main official meetings that marked 2015.
The first was the already-mentioned visit to Washington of Vietnamese
Communist Party’s General Secretary Nguyen Phu Trong in July of that
year. The visit had initially raised uncertainties as to the correct protocol to
follow, given that the US system does not itself have any equivalent figure.124
The most insightful analyses have aptly shown that although the Vietna-
mese leader’s trip did not result in tangible forward steps in the relations
between the two countries, it was of very great value. Among other things,
Nguyen Phu Trong was ultimately received by Barack Obama in the Oval
Office of the White House, on a par with a prime minister or head of sta-
te. This decision seemed to note the US’s definitive recognition of Hanoi’s
domestic political structures, including the centrality of the VCP and the
primary role the General Secretary plays within the Party. This seemed to
contribute to easing the suspicions raised by Vietnamese political factions
more concerned over US intentions toward their country. Moreover, the
meeting was characterised by the theme of «respect for each other’s political
123. Michela Cerimele, ‘Il 2013 vietnamita tra liberismo economico e autori-
tarismo politico’.
124. Cuong T. Nguyen, ‘The Dramatic Transformation in US-Vietnam Rela-
tions’, The Diplomat, 2 July 2014.
286
Vietnam 2014-2015
systems, independence, sovereignty and territorial integrity».125 This see-

med to de facto seal the US’s «substantive engagement» with the Vietnamese
Communist Party, first started by Hillary Clinton’s visit to Hanoi in 2012,
and then strengthened with the launching of a comprehensive partnership
the following year.126
It is worth noting that the July summit had been preceded by Tran Dai
Quang’s visit to Washington, in March of that same year. It has been noted
that although this meeting did not catalyse media attention, it in itself re-
presented a crucial advance in the relations between the two countries. A Po-
litburo member and the first Vietnamese Public Security Minister to visit the
United States, Tran Dai Quang was also commander of the national security
forces and, as such, a potential «primary target of human rights critics in the
United States». His visit to Washington was interpreted as demonstrating
Hanoi’s increased assuredness in dealing with its historic «ideological chal-
lenger». Again in this case, the welcome reserved for the minister seemed
to contribute to salving the qualms of Vietnamese «conservatives» averse to
rapprochement with Washington. An apparently clear mark of the eased
relations between the two countries on the ideological plane was the accep-
tance of the US Peace Corps’ presence in the country – these latter having
only a few years earlier been defined a subversive and «hostile force».127
It is true, within this picture, that the specific theme of human rights
has remained of central importance, and has been constantly addressed
throughout the more recent exchanges between the two countries. Even so,
the objective qualitative leap in bilateral relations seemed bound – at least
in part – to encourage a further «levelling down» of the two countries’ diffe-
rent positions in this regard; as has already been seen in the past.
Without doubt, Vietnam’s «struggles» against US political pressure on
human rights has been the subtext of its rapprochement with Washington.128
In fact, US pressure has not brought about «reform or any meaningful ac-
tion to improve human rights» inside Vietnam.129 Significantly, in the past
years, Hanoi has continued to oppose the US’s full lifting of its embargo on
lethal weapons being conditional on the question of human rights.130 On
the other hand, even in August 2015 – as he visited Vietnam to mark twenty
years of the normalisation of relations – John Kerry remarked that:
125. Carl Thayer, ‘8 Developments in US-Vietnam Relations Show Emerging

Partnership’, The Diplomat, 13 July 2015.
126. Alexander L. Vuving, ‘A Breakthrough in US-Vietnam Relations’, The Dip-
lomat, 10 April 2015.
127. Ibid.
on China-U.S. Relations’, p. 1.
129. John Sifton, ‘The Wrong Message to Vietnam’, Huffington Post (US edn.),
7 July 2015.
130. ‘Vietnam: Don’t tie U.S. weapons sales to human rights issues’, The Wash-
ington Times, 1 June 2015.
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Michela ceriMele
[…] there are basic principles that we will always defend: No one should
be punished for speaking their mind so long as they are peaceful; and
if trading goods flow freely between us, so should information and ide-
as. And we believe that progress in upholding these basic human rights
will absolutely serve Vietnam’s interests in several ways. […]. Progress
on human rights and the rule of law will provide the foundation for a
deeper and more sustainable strategic partnership.131
More generally, the two countries have systematically underlined their
readiness to pursue dialogue and, at the same time, their objective differenc-
es in this regard. Within this evident dialectical tension, nonetheless, Hanoi
has often strategically made openings on the question of human rights, and
in particular in correspondence with crucial moments of its rapprochement
with the United States or integration into the international community. As
negotiations advanced on the TPP, Vietnam repeatedly proceeded to release
political prisoners.132 As mentioned above, the partial lifting of the lethal
weapons embargo was itself preceded by a manoeuvre of this type. After the
comprehensive partnership agreement was signed, there was a drop in ar-
rests and the number of political activists, journalists and bloggers who were
detained.133 Already in the second half of the 2000s, as relations with the
United States intensified, Hanoi released political prisoners and negotiated
over religious freedoms. At stake in that period there were several crucial
political-diplomatic developments: premier Phan Van Khai’s historic 2005
visit to Washington; the preparations for Vietnam joining the WTO; and
President Nguyen Minh Triet’s 2007 visit to the United States.134 In the
lead-up to Vietnam’s entry into the WTO (2007) and its election to the UN
Human Rights Council (2013), there were also openings on the question of
the independence of the trade unions.135
131. John Kerry, Secretary of State, Remarks on U.S.-Vietnam: Looking to the

Future, Daewoo Hotel, Hanoi, 7 August 2015 (http://www.state.gov/secretary/re-
marks/2015/08/245789.htm).
132. ‘Vietnam’s Release of pro-Democracy Political Prisoners Linked to Free
Trade Talks with the U.S., Congressional Pressure’, Peace and Freedom. Policy and World
Ideas, 14 April 2014.
133. Human Rights Watch, World Report 2015: Vietnam. Events of 2014, undated
(www.hrw.org); Human Rights Watch, World Report 2014: Vietnam. Events of 2013,un-
dated (www.hrw.org).
134. Mark E. Manyin, U.S.-Vietnam Relations: Background and Issues for Congress,
Congressional Research Service, 2 January 2009; Mark E. Manyin, The Vietnam-U.S.
Normalization Process, Congressional Research Service, 17 June 2005; Catharin E. Dal-
pino (ed.), Dialogue on U.S.-Vietnam Relations. Ten Years after Normalization, Three Part
Series, Vol. 3, Los Angeles, CA: The Asia Foundation, 2005.
135. Joe Buckley, ‘Will the TPP be good for workers in Vietnam?’, A blog from
the Department of Development Studies, SOAS, University of London, 30 November 2015
(http://blogs.soas.ac.uk).
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Vietnam 2014-2015
For its part, the US administration has not been averse to endorsing
the Vietnamese government’s proclamations of intent, or the limited mate-
rial advances that this latter actually made.136 This has allowed Washington
to legitimise its proceeding with bilateral relations in spite of the many criti-
cal voices that have been raised, including in Congress, reaffirming these re-
lations’ beneficial effect on freedoms within Vietnam.137 However, Vietnam’s
openings have been mostly limited and superficial, and often the promises
made have not been kept. As noted by an analyst, the Vietnamese Commu-
nist Party has thus far proven able to combine its economic opening with
the preservation of its political control.138 Beyond the numerical tally of po-
litical prisoners, often the focus of Washington’s attentions, in 2015, «amid
high level diplomacy», the human rights situation in Vietnam was reported
as being persistently critical. 139 To put it in the words of Brian Adams, the
Asia Director of Human Rights Watch: «Vietnam tried to minimize political
trials and convictions in 2015 to gain favour during the Trans-Pacific Part-
nership negotiations, but repression against activists remained firm, with
beatings increasing».140
6.2. The TPP and labour standards

The dynamic we briefly reconstructed above brings into question the
role that labour standards in general – and more specifically the side-agre-
ement on labour between the United States and Vietnam – were meant to
play in the TPP. They above all seemed to respond to the Obama admini-
stration’s attempt to influence the fiery domestic political debate around
the free trade agreement.141 On the Vietnamese side, adherence to labour
standards – officially reasserted in November 2015142 – certainly did serve
the demands of the Party’s own internal legitimation.143 However, the ove-
136. Shawn W. Crispin, ‘US-Vietnam strategic partnership must be contingent

on press freedom’, Committee to Protect Journalists, 10 August 2015; John Sifton, ‘Fixing
the United States’s Human Rights Misstep with Vietnam’.
137. See for example: Tom Malinowski, ‘TPP Will Help Workers in Vietnam
Pursue Their Rights’.
139. Shawn W. Crispin, ‘US-Vietnam strategic partnership must be contingent
on press freedom’; John Sifton, ‘The Wrong Message to Vietnam’.
140. Quoted in ‘Re-elected Vietnam communist boss: «A lot of work ahead»’,
USA TODAY, 28 January 2016.
141. ‘After Trans-Pacific Partnership Text Released, Labor Advocates Say Hu-
man Rights Protections «Not Enforceable»’, International Business Times, 5 November
2015; ‘Trans-Pacific Partnership Text Released, Waving Green Flag for Debate’, The
New York Times, 5 November 2015.
142. International Labour Organization, Welcoming Viet Nam’s Labour Rights Com-
mitments, ILO Stands Ready for Support, Press Release, 5 November 2015 (www.ilo.org).
289
Michela ceriMele
rall treatment of labour rights and conditions in the TPP provoked not a
few criticisms.
Before going on to give a few examples of these objections, it seems
useful to make a general observation. As in most FTAs, the main labour
standards included in the TPP directly invoke the «core labour standards»
of the ILO’s 1998 Declaration on Fundamental Principles and Rights at
Work (DFPRW) – and not that Organization’s set of labour conventions.
This has itself been considered an element of ambiguity.144 Indeed, the
appearance of the DFPRW at the end of the 1990s responded to the at-
tempt to reassert the question of labour – marginalised in previous deca-
des – in the context of growing economic globalisation and trade liberali-
zation, characteristic of those years. The labour standards at the heart of
the DFPRW are based on 8 key pre-existing ILO labour conventions.145
These core standards are meant to be binding on all ILO member states,
regardless of whether or not they have ratified the 8 conventions.146 Ho-
wever, ever since its first appearance – strongly backed by the United Sta-
tes – the DFPRW has proven an instrument with less enforcement capacity
than the existing international labour rights regime. As one authoritative
commentator explained, it embodied a shift of emphasis «from a focus
on rights, the content of which is relatively well defined in internatio-
nal treaties» to a «focus on more generally formulated ‘principles’». As a
consequence, «There is now an emphasis on soft promotional techniques
[…].» 147
144. International Trade Union Confederation, Trans Pacific Partnership Labour

Chapter Scorecard Fundamental Issues Remain Unaddressed, 27 November 2015 (http://
www.ituc-csi.org/IMG/pdf/trans_pacific.pdf).
145. The 8 ILO fundamental conventions on labour are: No. 87 on Freedom
of Association; No. 98 on Right to Organize and Collective Bargaining; No. 29 on
Forced Labour; No. 105 on Abolition of Forced Labour; No. 138 on Minimum Age;
No. 182 on Worst Forms of Child Labour; No. 63 on Equal Remuneration; No. 111
on Discrimination (Employment and Occupation). See ILO, The International Labour
Organization’s Fundamental Conventions, Geneva: International Labour Organization,
2003, p. 8.
146. ILO Declaration on Fundamental Principles and Rights at Work.
147. Philippe Alston, ‘«Core Labour Standards» and the Transformation of the
International Labour Rights Regime’, European Journal of International Law, Vol. 15,
No. 3, 2004, p. 458. As of 2015 Vietnam had ratified 5 of the ILO’s 8 fundamental
conventions on labour (No. 29 on Forced Labour; No. 100 on Equal Remuneration;
No. 111 on Discrimination (Employment and Occupation); No. 138 on Minimum
Age; No. 182 on the Worst Forms of Child Labour), see International Labour Organ-
ization, International Labour Standards in Vietnam, undated (http://www.ilo.org/hanoi/
Areasofwork/international-labour-standards/lang--en/index.htm).For its part, the US
had only signed up to two (No. 105 on the Abolition of Forced Labour and No. 182
on the Worst Forms of Child Labour), see United States Department of Labor, In-
ternational Labor Standards and the ILO, undated (http://www.dol.gov/ilab/diplomacy/
PC-ILO-page2.htm).
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Vietnam 2014-2015
Analyses have also brought into relief the weakness of the specific en-
forcement mechanisms set out in the TPP;148 such a weakness has been alre-
ady amply demonstrated by assessments of other US FTAs, including the
new-generation ones (2009 and after), which set out strengthened measures
concerning labour rights and standards.149 As we mentioned in the previous
section, the TPP also proposed that member countries adopt laws that gua-
rantee «acceptable conditions of work related to minimum wages, hours of
work and occupational safety and health».150 Nonetheless, the parameters
of «acceptability» have not been referred to any specific standard; they have
instead been left to the decision of individual governments. Moreover, the
labour chapter appears to allow countries – in order to be more attracti-
ve for trade and investment – to weaken their provisions concerning the
«acceptable conditions of work» and also those related to the fundamental
rights themselves (in this case, provided that the minimum standards, as
internationally defined, are met).151 The effective lack of enforcement me-
chanisms in the side-agreement between the United States and Vietnam has
also been noted.152As some analysts have shown, the Vietnamese authorities
have themselves claimed that the country has already put in place measures
aimed at satisfying the criteria of the DFPRW – to which it already adhered
as an ILO member country – and already has adequate laws on wages, hours
of work and health and safety. At the same time, their proclaimed acceptan-
ce of the requirement regarding union independence seemed liable again
to translate into purely superficial measures, or unkept promises.153
It should be said, in the above regard, that the enormous limits to the
functioning of the Vietnamese union – especially at the factory level – have
so far certainly contributed to exposing the country’s emerging working
class to very poor working and living conditions. It is also true, however,
148. See, for example: International Trade Union Confederation, Trans Pacific
Partnership Labour Chapter Scorecard Fundamental Issues Remain Unaddressed and Human
Rights Watch, ‘Q&A: The Trans-Pacific Partnership’, 12 January 2016 (www.hrw.org).
149. As, for example, in the case of: CAFTA-DR (Dominican Republic-Central
America Free Trade Agreement) (2005); PTPA (Peru Trade Promotion Agreement)
(2009) and CTPA (Colombia Trade Promotion Agreement) (2012), see Ibid.; ‘TPP
Ignores Workers’ Needs and Fails to Address Weaknesses from Past Trade Agree-
ments’, The World Post, 12 November 2015; United States Government Accountabil-
ity Office, Free Trade Agreements. U.S. Partners are Addressing Labour Commitments, but
More Monitoring and Enforcement are Needed, 13 November 2014 (http://www.gao.gov/
assets/670/666787.pdf).
150. TPP Made in America Protecting Workers.
151. International Trade Union Confederation, Trans Pacific Partnership Labour
Chapter Scorecard Fundamental Issues Remain Unaddressed, pp. 1-2. See this paper for an
analysis of other problematic aspects of the labour chapter of the TPP.
152. HRW, ‘Q&A: The Trans-Pacific Partnership’.
153. For a more detailed analysis see Le Hong Hiep, ‘The TPP’s Impact on Vi-
etnam: A Preliminary Assessment’ and Joe Buckley, ‘Will the TPP be good for workers
in Vietnam?’.
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that over the years a singular mechanism has been developing in Vietnam,
through which the union and government apparatus «respond» to the
high level of worker conflictuality, mostly expressed in the form of «wildcat
strikes».154 Particularly frequent from the early 2000s onward, some 80%
of these strikes have been concentrated in companies financed by foreign
capital.155 Although illegal from a formal point of view, such strikes have
been de facto «institutionalized».156 They normally lead to the intervention
of government and union officials at the negotiating table on behalf of the
workers, once the conflict has broken out.157 Many of these industrial dis-
putes have resulted in a raise of minimum wages, following what some have
labelled «collective bargaining by riot».158
In 2015 the question of the Vietnamese unions’ transition to a more
democratic set-up still remained very much unresolved and problematic, all
the more so in a country that continues to declare itself a «socialist market
economy». Even the reform programmes that the government and the un-
ion have adopted in response to rising labour conflict have overall proven to
fall far short of providing workers democratic representation.159 Nonethe-
less, not only the TPP’s provisions seem unwilling to effectively challenge
the status quo. Such agreements also highlight the ultimate incompatibility
between, on the one hand, the «neoliberal» models of development and
industrialization and, on the other hand, the very same labour (and other)
rights they claim to promote – thus bringing to light the constraints under
which trade unions in Vietnam (as elsewhere) operate.
As noted above, a central factor in catalysing investors’ attentions to-
wards Vietnam has been the possibility of accessing a deep reserve of low-cost
and relatively well-educated young workforce. Effectively, the agreement
154. The right to strike was recognised in Vietnam with the introduction of
a labour code in 1994. However, the only strikes considered legitimate are those
launched by the unions and following the failure of attempts to resolve collective dis-
putes by complex formal conciliation and arbitration mechanisms. Michela Cerimele,
‘2008: Il Vietnam nell’anno della tempesta perfetta’, Asia Maior 2008, pp. 203-2014.
155. Erwin Schweisshelm, ‘Trade Unions in Transition – Changing Industrial
Relations in Vietnam’, Friedrich Ebert Stiftung, Vetnam Office, September 2014, p. 4
(https://www.fes.de/gewerkschaften/common/pdf/2014_09Vietnamese_TU_in_Tran-
sition.pdf).
156. Tim Pringle & Simon Clark, The Challenge of Transition: Trade Unions in
Russia, China and Vietnam, New York: Palgrave, 2011, p. 72, cited in Kaxton Siu &
Anita Chan, ‘Strike Wave in Vietnam, 2006-2011’, Journal of Contemporary Asia, Vol.
45, No. 1, 2015, p. 80.
157. Michela Cerimele, ‘2008: Il Vietnam nell’anno della tempesta perfetta’,
p. 211.
158. Tim Pringle & Simon Clark, The Challenge of Transition: Trade Unions in
Russia, China and Vietnam, p. 72, cited in Kaxton Siu and Anita Chan, ‘Strike Wave in
Vietnam, 2006-2011’, p. 80.
159. Erwin Schweisshelm, ‘Trade Unions in Transition – Changing Industrial
Relations in Vietnam’.
292
Vietnam 2014-2015
could definitively trap Vietnam in productive specializations inherently in-

compatible with advancing even basic labour rights and conditions.160 Stud-
ies in Vietnam as elsewhere have widely shown what international inves-
tors’ expectations and demands are with regard to the characteristics of the
workforce – indeed, low-skill and labour intensive productions can be easily
moved to other countries offering lower labour costs. A recent survey on
the Vietnamese garment and electronics sectors – typically relying on the
recourse to poor internal migrant workers, in particular young women – has
for example confirmed the spread of low pay and unstable employment
relations in foreign invested firms, the workforce’s enormous vulnerability,
the existence of very high turnover rates, and the prevalence of harsh and
highly disciplinary factory regimes.161 Some case studies on female migrant
labour in the electronics sector have shown in detail how the labour regimes
driven by foreign investment are structurally tailored to producing (migrant)
workers that are exploitable, poorly paid, vulnerable, temporary and circu-
latory (and thus exposed to a ceaseless return to poverty).162
In the above respect, it’s worth recalling the idea of labour rights and
standards that the United States and its businesses themselves concretely
uphold and promote. Telling, for example, is the hostility that the American
Chamber of Commerce and the US-China Business Council (along with the
European Union Chamber of Commerce) have shown in the past towards
attempts at concretely improving the basic standards of work of millions of
Chinese (internal migrant) industrial workers – as in the case of the 2008
Chinese Labor Contract Law. Not only did the above organizations criticize
some pillar aspects of the draft law’s provisions; they also intensively lob-
bied for having them revised and mitigated in its final version. Moreover,
conspicuous by their absence in the two organizations’ comments to the
draft law was any reference to the rights to strike and organize – which the
Chinese labour law itself does not recognize. 163
160. On the labour-unfriendly nature of FDI-driven industrialization see Pi-

etro P. Masina, ‘Uneven Development Trap in Southeast Asia and its Implications
for Labour’, in Matteo Alcano & Silvia Vignato (eds.) (forthcoming) A Place for Work:
Small-Scale Mobility in Southeast Asia, Chiang Mai: Silkworm Books. See also Masina’s
already mentioned Il Sud Est Asiatico in trappola: Storia di un miracolo mancato and Mi-
chela Cerimele, ‘Il 2013 vietnamita tra liberismo economico e autoritarismo politico’.
161. The survey mostly concerned industrial parks in the North of the country,
particularly Thang Long and Sai Dong (Hanoi province), Tan Truong and Nam Sach
(Hai Duong province), Khai Quang (Vinh Phuc province), see Do Ta Khanh, SWORR
Fieldwork Research: Synthesis Report, August 2015 (unpublished).
162. Michela Cerimele, ‘Informalising the Formal: Work Regimes and Dual La-
bour Dormitory Systems in Thang Long Industrial Park (Hanoi, Vietnam)’, in Matteo
Alcano & Silvia Vignato (eds.) (forthcoming) A Place for Work: Small-Scale Mobility in
Southeast Asia.
163. One of the most important Chinese laws on protecting labour, the 2008
Labour Contract Law aimed, among the other things, at improving the protection
of dispatched workers, encouraging the use of more stable contracts, empowering
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Michela ceriMele
Indeed, US firms are among those well-known for spreading heavily

labour-unfriendly practices around the world. Noteworthy in this regard was
the highly criticized visit that Obama paid to Nike headquarters in Oregon
in May 2015, as part of its «campaign» to gain Democratic and trade-union
support for the free trade agreement.164 With much at stake in the TPP, as of
2015 Nike represented 60% and 30% of the US and world footwear markets
respectively.165 The corporation’s labour practices in Vietnam – its largest
production base166 – have apparently improved since the 1990s, when work-
ers’ harsh treatment in the country came to light, heavily damaging the im-
age of the giant conglomerate.167 However, as a report noted in 2015, Nike
has continued strongly to rely (and apparently still intended to do so) on the
below-subsistence wage levels that can be imposed on Vietnamese workers,
and on the lack of basic workers’ freedoms and rights in the Southeast Asian
country.168 It is also, more generally, worth remembering that the US has
not signed up to the ILO convention on workers’ freedom of association and
collective bargaining. In fact US «law allows employers to permanently re-
place workers that exercise the right to strike»,169 whereas at the enterprise
level, heavy anti-union practices are notoriously widespread, and made pos-
sible by easily-escaped legislation.170
With regards to the issue of the compatibility between the TPP and hu-
man and labour rights, another important question relates to the much-crit-
icized Investor to State Dispute Settlement (ISDS) mechanism. The extent
to which the ISDS will be extended to areas such as labour regulations – if
it is at all – is still difficult to assess. However, the very fact that this mecha-
nism did ultimately enter the TPP’s text is telling of the «rights-unfriendly»
rationale of the agreement – already visible in measures such as those re-
the role of trade unions in defining companies’ rules and decisions (including those
related to lay-offs). See Francesca Congiu, ‘The Chinese Labour Contract Law and
the Western Response’, 6th SGRI Conference, Regional Orders in the XXI Century, Trento,
Italy, 21-22 June 2013.
164. ‘Obama’s Scheduled Visit To Nike Has Trade Deal Skeptics Scratching
Their Heads’; ‘Obama at Nike headquarters: why push trade deal at an outsourcing
giant?’.
165. Charles Kernaghan, A Race to the Bottom. Trans-Pacific Partnership and Nike
in Vietnam, p. 1.
166. Ibid.
167. ‘Ernst & Young Environmental and Labour Practice Audit of the Tae
Kwang Vina Industrial Ltd. Co., Vietnam’, CorpWatch, 13 January 1997 (http://www.
corpwatch.org/article.php?id=2488); ‘Nike Shoe Plant in Vietnam Is Called Unsafe
for Workers’, The New York Times, 8 November 1997.
168. Charles Kernaghan, A Race to the Bottom. Trans-Pacific Partnership and Nike
in Vietnam.
169. For a more detailed analysis see Lance Compa, ‘Labor Rights and Labor
Standards in Transatlantic Trade and Investment Negotiations: An American Per-
spective’, in Christoph Scherrer (ed.) The Transatlantic Trade and Investment Partnership
(TTIP): Implications for Labor, Merin: Rainer Hampp Verlag, p. 126.
170. Ibid., pp. 125-127.
294
Vietnam 2014-2015
lated to intellectual property.171 Aimed at guaranteeing the enforceability

of international investors’ and corporations’ rights and interests, this is a
mechanism that can significantly challenge governments’ regulatory capac-
ity in areas of public interest.172 With regard to the specific issue of labour
rights and standards, it seems legitimate to echo one commentator’s ob-
servation: «[…] if the Vietnamese government did decide to enact policies
to strengthen labour – such as a big increase in the minimum wage […] –
companies may sue, forcing the country to pay compensation and reverse
policies. Even if independent unions were allowed, how much power would
they really have to struggle for policy changes in the face of this corporate
power?».173 Potentially, mechanisms like the ISDS do indeed seem capable
of imposing «from above» precise and stringent limits on the effectiveness
of any pressure «from below» seeking substantial political and institutional
change.
We said above that in 2015 the question of human and labour rights in
Vietnam represented an element of continuity with the controversial rela-
tion between rhetoric and practice that has traditionally underpinned US
foreign policy on these subjects. Seen through the lens of the TPP and la-
bour standards, the human rights issue also raises questions regarding the
continued US tendency to collapse the very meaning of democratic free-
doms, principles and rights into its own vision of the world order. Inextri-
cably bound up with «U.S. practices of ‘neoliberalism’»174 and hegemony,
the extension of the theme of Vietnamese «moral unaccountability»175 into
the post-normalization years also appeared to disguise the fashioning of
the mechanisms that would finally be able to empty these notions of their
genuine socially-transformative potential. In particular, while reference to
labour rights and standards appears to serve the interests of key interna-
tional stakeholders, agreements such as the TPP do indeed seem capable of
weakening any genuine attempt at improving labour conditions and rights
and reforming its organizational structures.
171. Notwithstanding the flexibility measures granted to Vietnam, there seemed

to be confirmation of the already-raised concerns regarding the effects on the right
to health – especially in terms of accessibility and cost of medicine – that would result
for the TPP’s provisions on pharmaceutical intellectual property protection, see ‘TPP
Transition Periods on Pharmaceutical Intellectual Property Rules’, Public Citizen. See
also: Michela Cerimele, ‘Il 2013 vietnamita tra liberismo economico e autoritarismo
politico’.
172. See, for example: Christoph Scherrer (ed.) The Transatlantic Trade and In-
vestment Partnership (TTIP): Implications for Labor; see also: Michela Cerimele, ‘Il 2013
vietnamita tra liberismo economico e autoritarismo politico’.
173. Joe Buckley, ‘Will the TPP be good for workers in Vietnam?’.
174. Christina Schwenkel, ‘From John McCain to Abu Ghraib: Tortured Bodies
and Historical Unaccountability’, p. 31.
175. Ibid.
295
MYanMar 2015: political turning point, econoMic
and social challenges
Pietro Masina
University of Naples «L’Orientale»

pmasina@unior.it
The year 2015 will be remembered as a watershed in the political evolution of

Myanmar. After 5 years of semi-civilian government, the country was allowed to
hold free elections for a new national parliament and regional assemblies. In No-
vember, the National League for Democracy (NLD) led by Aung San Suu Kyi won
by a landslide obtaining almost 80% of votes throughout the country, including in
ethnic states in which it scored much better than expected. The incumbent Union
Solidarity and Development Party (USDP) – the party created by the army – suf-
fered a crushing defeat: it got only 8% of the votes, while many party leaders had
hoped it would get up to one third of the national popular vote. The scale of the
NLD victory will allow it to choose the new president and to form the new go-
vernment. However, the constitution approved by the outgoing military regime has
created a number of important obstacles to real regime change. First, the Tatmadaw
(the army) will continue to nominate 25% of parliamentary members and will have
the power to veto constitutional changes. Second, the Tatmadaw will continue to
appoint the ministers of Defence, Border Affairs and Home Affairs. This implies
that the army will maintain control of the police as well as of the General Admini-
stration Department, which forms the backbone of the administration at the local
level. Third, a clause in the constitution prevents the election of Aung San Suu
Kyi to the presidency, thus confronting the NLD with two equally risky choices, ei-
ther selecting a non-entity as president, potentially damaging the reputation of the
NLD, or endangering the leadership of Aung San Suu Kyi by choosing a capable
politician for the state’s highest political office. The limits imposed to far-reaching
political change help to explain why the army accepted the transition and immedia-
tely recognized the electoral results.
The complexity of the political and institutional transition is bound to cause con-
tinuing difficulties in addressing the main national challenges. A ceasefire with
eight ethnic armies reached in October 2015 was an important result, but the
ethnic conflict remains rampant. Political and ethnic tensions in Rakhine state
between the Buddhist majority and Muslim minorities have become particularly
severe, and the dramatic conditions of the Rohingya produced an international
crisis in spring 2015. To a very large extent, these ethnic conflicts are the result of
both the conditions of poverty in which the large majority of the population live and
the political, cultural and economic suppression of ethnic minorities since national
independence.

Pietro Masina
1. The elections and the political transition
After five decades of military rule, a political transition began in 2011.

International sanctions had made the country excessively dependent on
China, weakening the prestige of the army as the guardian of national so-
vereignty.1 The looming economic crisis and ethnic insurgency in several
states made evident the need for change. This became particularly urgent
after the 2007 mass protests triggered by an increase in oil prices, during
which the influential Buddhist clergy took an open stance against the junta.
Eventually, the pressure for political change came also from inside the regi-
me. The business elite – traditionally made up of the army leadership and
its cronies, but increasingly becoming an autonomous oligarchy – saw the
prospects of large profits deriving from a closer integration into the world
economy.2 The strategy adopted by the army was a process leading towards
a «discipline-flourishing democracy», in which the return to a civilian go-
vernment – most likely dominated by the NLD – would continue to guaran-
tee the long-term interests of the army itself and its allies.3 Political elections
were held in 2010 leading to the creation of a semi-civilian government.
Army strongman Than Shwe stepped down as country leader, and former
general Thein Sein took over as president. Although the NLD had boycot-
ted the elections, Aung San Suu Kyi was released from house arrest and a
timid political dialogue began. The same Suu Kyi agreed to participate in
the by-elections in 2012 and was elected to parliament. Eventually, the NLD
and other regional parties were allowed to reorganize and prepare for the
elections anticipated in 2015.
In early July 2015, the Electoral Commission announced that political
and administrative elections would be held on 8 November. Only a few days
before, the outgoing parliament had refused to abolish one of the most con-
troversial articles of the constitution drafted by the military rulers in 2008.
This article impedes any citizen with family connections with foreigners to
be elected as president of the republic – a norm obviously designed against
Aung San Suu Kyi, whose two sons hold British passports from their late
father. Other articles further contributed to maintaining a strong military
influence on future administrations. First, 25% of parliamentary seats are to
be occupied by officers nominated by the army, while changes to the consti-
tution require the support of 75% of the parliament. Second, the army will
continue to appoint key ministers in future governments. These ministers
1. See infra par. 2.

2. Michele Ford, Michael Gillan & Htwe Htwe Thein, ‘From Cronyism to Oli-
garchy? Privatisation and Business Elites in Myanmar’, Journal of Contemporary Asia,
Vol. 46, No. 1, 2016, pp. 18-41.
3. Giuseppe Gabusi, ‘State, Market and Social Order: Myanmar’s Political
Economy Challenges’, European Journal of East Asian Studies, Vol. 14, No. 1, 2015, pp.
52-75.
298
MyanMar 2015
include Defence and Border Affairs, thus giving the army unlimited autho-
rity upon the management of the conflict with insurgent ethnic groups. The
other ministry controlled directly by the army is Home Affairs, from which
depend the Police and the General Administration Department, managing
the local administration throughout the entire country.
In calling for free elections, the army had probably expected to be
able to continue to control parliament or at least to force the NLD to form
a coalition government. Since 25% of the MPs are appointed officers, had
the army-backed Union Solidarity and Development Party (USDP) obtained
one third of the popular votes, it would have controlled the absolute ma-
jority in parliament.4 The army had possibly also expected that the NLD
would do rather poorly in ethnic states, where local parties were supposed
to have more appeal. The lack of reliable opinion polls created a climate of
incertitude ahead of the 8 November elections. The results, however, com-
pletely dispelled any illusion that the army may have had of its popularity
in the country. The military-backed USDP, led by the outgoing president
Thein Sein, obtained only 8% of votes. The NLD scored ten times more,
coming close to 80%, i.e., the same result it had obtained in 1990. At that
time, the army had reacted by annulling the vote, putting Aung San Suu Kyi
under house arrest and jailing many of the NLD leaders and supporters.
The USDP and the NLD were the only national parties to gain seats in the
parliament. The ethnic parties obtained only 11% of the popular vote with
only two achieving some success: the Arakan National Party obtained 12
seats in the House of Representatives (Pyithu Hluttaw) and 10 in the House
of Nationalities (Amyotha Hluttaw), while the Shan Nationalities League for
Democracy obtained 12 and 3 seats respectively. The other ethnic parties
won just a few seats or none at all.5
The clear victory obtained by the NLD was also reflected in the ad-
ministrative elections. In the seven Burman-majority regions, it obtained
95% of the votes, whereas in the seven ethnic states it achieved, on average,
45% of the popular vote, conquering the majority of the popular votes in
four states, while in the other three states no party was in a position to rule
alone.6
The outgoing government immediately recognized the NLD’s victory.
President Thein Sein’s spokesman and minister of Information Ye Htut,
4. Senior USDP officers expressed privately the hope that the party would get
about 20% of votes, corresponding to 15% of the elected seats. Combined with seats
occupied by the army representatives, this would have secured 40% of the parliamen-
tary seats to the outgoing regime and would have made a cohabitation government
the most likely outcome. See ‘Myanmar’s Electoral Landscape: Vibrant, But Uncer-
tain’, The Diplomat, 23 September 2015.
5. Crisis Group, The Myanmar Elections: Results and Implications, Crisis Group
Asia Briefing N°147, Yangon/Brussels, 9 December 2015, p. 4.
6. Ibid.
299
Pietro Masina
on his Facebook page, congratulated Aung San Suu Kyi, declaring that the
outgoing government would respect and obey the decision of the electorate
and would work peacefully in the transfer of power.7 Encouraging declara-
tions came also from the powerful commander-in-chief of the Myanmar
Armed Forces, Senior General Min Aung Hlaing who congratulated Aung
San Suu Kyi for winning a majority. Under the constitution, General Min
Aung Hlaing retained a considerable influence, which made it imperative
for the new government to cooperate with him.8
In the following weeks, it became clear that the army was committed
to respecting the electoral results but would not surrender its power un-
conditionally. On the one hand, the outgoing military leaders demanded
guarantees preventing any possible prosecution for the crimes committed
under their decades-long harsh rule. Whereas Aung San Suu Kyi and the
NLD have repeatedly declared the need to look ahead, it was unclear if a
complete impunity could and would be guaranteed. On the other hand,
the army and its cronies were eager to defend their economic interests and,
from this perspective, their offer of a smooth power transition was their way
to buy the new leadership’s goodwill.
In the intense and confidential contacts between the outgoing and in-
coming leaderships, particularly important was a secret meeting between
Aung San Suu Kyi and Than Shwe, the head of the military junta that had
ruled the country until 2011. News about the meeting was revealed by the
grandson of the 82-year-old former army leader with a post on Facebook.
Than Shwe, who is reported to maintain considerable power and influence,
not only acknowledged that Aung San Suu Kyi would become the new coun-
try leader but also expressed his will to support her with all his efforts.9
Although no further information about the exact content of the meeting
is available, it is likely that Aung San Suu Kyi sought support for the sup-
pression of the norms preventing her from being elected as new president
of Myanmar.
The future presidency remained a key issue in the two final months of
2015. The NLD continued to seek army consensus to amend the constitu-
tion and explored ways to circumvent the norms barring Aung San Suu Kyi
from assuming the job. The solution prospected by Aung San Suu Kyi before
the elections – nominating a figurehead who would let her continue to take
all the important decisions – was considered to be an uncomfortable second
best. A president with inadequate experience may compromise the reputa-
tion of the NLD and may be resented by the senior party leaders. At the
same time, the election of an experienced politician may undermine Aung
7. ‘Government and army congratulate Aung San Suu Kyi as Myanmar count
continues’, The Guardian, 11 November 2015.
8. Ibid.
9. ‘Former Myanmar military ruler Than Shwe «supports new leader»’, BBC
News, 6 December 2015.
300
MyanMar 2015
San Suu Kyi’s authority over a party that remains largely dependent on her
charismatic leadership. The parallel with Sonia Gandhi – who renounced
becoming Prime Minister after winning the elections in 2004 and remained
president of the Indian Congress Party – seems to be inappropriate.10 Not
only was the role of Aung San Suu Kyi – commonly referred to as «mother»
– a key element in the NLD success, but also her authority to keep together a
party that has few experienced leaders and lacks administrative experience.
The absence of a strong collective leadership is an acute problem as many
of the old generation, tempered by decades of struggles against the military
rule, have died or are in too poor health to continue leading the party. The
creation of a reliable, honest and inspiring younger leadership is a daunt-
ing task for a party that has obtained so large a majority of votes and will be
asked to govern a country with many challenges ahead.
In this sense, a more relevant parallel seems to be with South Africa
at the end of the apartheid regime. The charismatic leadership of Nelson
Mandela was paramount in securing a fairly smooth power transition and
creating a united and democratic country. However, the aspirations to social
and economic change that had fashioned such a strong consensus around
the African National Congress were eventually frustrated by a transition that
left economic power in the hands of the old white elite. This seems to be the
challenge ahead for Aung San Suu Kyi and the NLD. At the end of 2015,
there was some optimism for a power transition that would create the space
for a functioning democracy. However, the economic and social agenda of
the NLD remained too undetermined to make predictions about its ability
to address the expectations of a population still facing poverty and vulner-
ability.
2. The international relations of the «new» Myanmar
The years immediately following the advent of the semi-civilian gov-

ernment led by Thein Sein (2007) saw a realignment of Myanmar’s interna-
tional relations. The country had become increasingly dependent on China,
which had a strong strategic interest in Myanmar especially because it could
provide a friendly corridor to the Indian Ocean. Decades of military rule
and international recognition for the cause represented by Nobel Peace lau-
reate Aung San Suu Kyi had isolated the country, making China its only vi-
able partner. China provided funds for (often controversial) infrastructural
projects, became the major source for the import of consumption goods and
represented the main export market for local natural resources. Animos-
ity connected with ethnic conflicts along the borders has historically domi-
10. ‘With Suu Kyi banned, Myanmar voters ponder «proxy presidents»’, Re-
uters, 7 November 2015.
301
Pietro Masina
nated the bilateral relations and the Burmese army is known to harbour
anti-Chinese sentiments. However, warmer relations with China had been a
necessity for the military juntas facing international isolation. Cooperation
with the ASEAN – the Association of Southeast Asian Nations – was only a
limited surrogate for the lack of integration into the wider international
economy and could not reduce the dependency on China. It was only in
2011 when Thein Sein took the first steps in the direction of a political tran-
sition that the international relations of Myanmar started to shift. The Unit-
ed States and the European Union were quick to adopt a policy of positive
engagement, removing most sanctions against Myanmar. A number of high
profile visits revealed the recognition given to Thein Sein’s government for
its commitment to political transition.11 With the reestablishment of po-
litical dialogue with Western countries and an improvement in cooperation
with India, relations between Myanmar and China became more complex
and tense.12 Whereas Myanmar was keen to reduce dependence on its giant
neighbour, China tried to exert pressure on Myanmar to prevent a waning
of bilateral cooperation. Relations turned sour from September 2011, when
the government suspended an important hydroelectric project financed by
China (the Myitsone dam).13
Two major events shaped the relationship between China and Myan-
mar in 2015: the first confirming the deterioration of relations between Bei-
jing and the Thein Sein administration; the second, possibly anticipating a
new phase of bilateral cooperation.
The first event was a military and diplomatic crisis produced by clashes
along the borders. The incidents developed as a consequence of the ongo-
ing conflict between the Burmese army and Kokang insurgents. After six
years of ceasefire, in February 2015 fighting resumed as the Kokang army
reportedly attempted to regain lost territory.14 This local conflict – per se
not different from others setting the Burmese army in opposition to eth-
nic militias – immediately had repercussions in relations with Beijing, as
the Kokang are a Chinese-speaking minority living in the northern part
of Shan States, on the border with the Yunnan province of China. The Ko-
kang’s Myanmar National Democratic Alliance Army (MNDAA) had once
11. Some observers accused Western governments of having been too quick in
removing the sanctions and in extending economic support to the semi-civilian gov-
ernment, when it was still unclear if the political transition was an irreversible process.
See Giorgio Pescali, ‘Un processo di democratizzazione molto lento ma reale’, Asia
Maior 2014, pp. 207-9.
12. Jeremie P. Credo, ‘Myanmar and the Future of Asia’s New Great Game’, The
Diplomat, 24 July 2015.
13. Simone Dossi, ‘Regime Change and Foreign Policy: Explaining the Fluctua-
tions in Myanmar’s Economic Cooperation with China’, European Journal of East Asian
Studies, Vol. 14, No. 1, 2015, pp. 98-123.
14. ‘47 Burmese soldiers killed in Kokang conflict: state media’, DVB, 13
February.
302
MyanMar 2015
been part of the pro-China Burmese Communist Party and is considered to

maintain close connections with Beijing. As the military clashes escalated,
President Thein Sein warned China not to encroach on Myanmar’s sover-
eignty, while both the MNDAA and Beijing denied that China had provided
support to the Kokang insurgents.15 Neither the negotiations between the
Myanmar government and the MNDAA nor the dialogue between Naypy-
idaw and Beijing helped to find a settlement. In March, the Burmese air
force bombed the Chinese territory in three distinct episodes and killed or
wounded several farmers, besides causing material damage. In the even-
ing of 13 March, the Burmese ambassador was summoned to the Chinese
Ministry of Foreign Affairs: Beijing formally and strongly protested and de-
manded a complete investigation of the incidents. The following day, the
vice chairman of the Chinese Central Military Commission made an urgent
call to Min Aung Hlaing, the commander-in-chief of the Burmese armed
forces, and made an ultimatum-type statement that the PLA would inter-
vene immediately if such incidents happened again.16 The tension was so
high that the Burmese government immediately chose to send its Foreign
Minister to Beijing to offer an official apology.17 The episode, which even-
tually led to a new ceasefire, was highly indicative of the critical status of
relations between the two countries.
The second event was Aung San Suu Kyi’s mission to Beijing. The
strained relations with Thein Sein’s government had resulted in a decline
of FDI flows from the giant neighbour – from a peak of US$8.2 billion in
2010/11 to only US$56 million in 2013/14, followed by a timid recovery
to US$516 million in 2014/15.18 Nevertheless, China remains by far My-
anmar’s largest trading partner, accounting for over half of the country’s
external trade.19 Economic relations with Beijing are expected to remain of
paramount importance for the NLD-led government after the 2015 elec-
tions. After Aung San Suu Kyi’s victory in 1990, China was one of the first
countries to congratulate the NLD and this led to a suspension of diplomat-
ic relations once the army refused to acknowledge the electoral results. Rela-
tions between the two countries were soon re-established and, as discussed
above, China became a major partner of the military junta. As a result, for
many years there were practically no contacts between the NLD and the
Chinese government. When Thein Sein inaugurated the transition process,
15. ‘President warns China and rebels over Kokang’, Myanmar Times, 3 March
2015.
16. ‘Deadly Myanmar air bombings prompt Chinese military buildup on bor-
der’, The Washington Times, 19 March 2015.
17. Wai Moe, ‘Why Kokang Rebels Are Giving Fits to Burma’s Military’, Foreign
Policy, 6 May 2015.
18. Yun Sun, ‘China’s relations with Myanmar: Does an NLD government mark
a new era?’, Asia Times, 8 December 2015.
19. European Commission, DG Trade Statistics online, last reported year 2014.
303
Pietro Masina
relations with the NLD resumed, although the two parties remained dif-
fident for different reasons. Beijing feared that Aung San Suu Kyi would
support pro-democracy groups in China and may even sustain the Tibetan
cause of her fellow Nobel Peace laureate, the Dalai Lama. Even more im-
portantly, Beijing was concerned that she would establish cooperation with
Western countries and Japan with an anti-Chinese aim. On the other hand,
Aung San Suu Kyi and the NLD could not easily forget the support given by
the Chinese government to the military junta during two decades of brutal
rule. Given the importance of bilateral relations, however, from the begin-
ning of the transition process both sides did their best to build confidence
through a rather intense dialogue via the Chinese Embassy in Yangon, cul-
tural and academic exchanges, and high-level meetings.20 The visit that
Aung San Suu Kyi paid to China in June 2015 to meet President Xi Jinping
and the Prime Minister Li Keqiang represented a major step forward in
bilateral dialogue. Officially, the visit was held at party level, as the Burmese
guest was a simple parliamentarian, but it was clear that the aim was to
lay the ground for state relations after the elections in Myanmar. The new
NLD-led administration would need economic support from China and, in
recent years, Aung San Suu Kyi did her best to dilute Beijing’s fears. This
constructive attitude was interpreted as another sign of Aung San Suu Kyi’s
pragmatism.21 On the Chinese side, creating a positive relationship with
the NLD is considered a way out from the impasse that had characterized
bilateral relations in the previous five years. While Beijing had no illusions
about resuming a warm and preferential cooperation with Naypyidaw, its
aim was to reach a «new normal» that could help to achieve long-term po-
litical and economic priorities.22 At the core of Beijing interests continued
to be infrastructural works – an oil and gas pipeline, railways, highways and
harbours – which would connect the landlocked south-western provinces of
China with the Indian Ocean.
In political terms, 2015 did not see any major development affect-
ing relations with Western countries, Japan and India. For all, the months
ahead of the Burmese elections were a period of suspense, possibly because
high-level international meetings would have risked consolidating the pow-
er of the semi-civilian government in a critical election year. At the same
time, the year confirmed the tendency toward a major reorganization of the
Burmese economy on the basis of a World Bank-inspired neoliberal model
and a closer integration in the regional and international economy. The
lack of access to Western markets represented a major loss both for the ex-
a new era?’.
21. Jurgen Haacke, ‘Why Did Myanmar’s Opposition Leader Just Visit China?’,
The Diplomat, 15 June 2015.
a new era?’.
304
MyanMar 2015
port of extractive products and for the ambition to develop a manufacturing

industry. A «pro-market» economic reform became the point of consensus
between the army, the NLD, major international players such as the US and
Japan, and the Washington-based International Financial Institution.23 The
economic template is the same as had already been experimented with by
other Southeast Asian countries, and currently being enforced by the new-
comers in the regional division of labour (Vietnam, Cambodia and Laos):
FDI-led and export oriented industrialization relying on very low labour
costs, trade liberalization, privatization of key state assets through an al-
liance between international capital and local elites.24 Interestingly, these
«pro-market» reforms are promoted by neoliberal pundits (such as Francis
Fukuyama) on the basis of the argument that reducing state control over key
assets and liberalizing international economic relations is a major contribu-
tion to state formation and the rule of law.25 For these free-marketers, the
reforms will create a level play field for national and foreign firms, forc-
ing all economic actors to submit to the neutral discipline of the markets.
However, these reforms tend to overlook the reality that in the context of
Myanmar, even more dramatically than in other neighbouring countries,
the inflow of foreign capital only occurs in alliance with local elites, and
de facto implies creating new opportunities for the cronies of the former
regime, including those more directly involved in criminal activities and
drug trafficking.26 Keeping in mind the enormous economic interests at
stake in the Burmese political reform process is important to better ap-
preciate the complex mosaics of power struggles and new alliances, which
have characterized the transition process before and after the elections of
November 2015. One of the most remarkable political events of the year
was the removal in August of Shwe Mann as head of the USDP, the army
sponsored party. When the country was still ruled by military junta, Shwe
Mann had been the number three of the Tatmadaw and a protégé of Than
Shwe. He then left the army to become the Speaker of the Lower House and
in 2013 took over the leadership of the USDP from Thein Sein. Eventually
he became a close confidante of Aung San Suu Kyi to the point that he was
considered as a possible candidate for president of the republic with NLD
support. His removal from the USDP leadership with a palace coup-style
intervention of security forces loyal to Thein Sein suggested that his rela-
tionship with Aung San Suu Kyi had become too warm for the incumbent
23. Michele Ford, Michael Gillan & Htwe Htwe Thein, ‘From Cronyism to Oli-
garchy? Privatisation and Business Elites in Myanmar’.
24. World Bank, ‘All Aboard! Policies for Shared Prosperity in Myanmar’, 2015.
25. ‘Francis Fukuyama: «It’s Not That Hard to Hold a Free and Fair Election»’,
Irrawaddy, 13 August 2015.
26. Jared Naimark, ‘Fukuyama’s Flawed Take on Burma’, Irrawaddy, 24 August
2015.
305
Pietro Masina
president.27 The political turnabout of a former general suspected to have

had responsibility for severe human rights abuses might be explained by
the need to protect the economic interests of his family. As highlighted by
Asia Maior 2014, Shwe Mann and his sons continued to control important
monopolies in the Burmese economy.28 While the November elections have
probably compromised the chances of Shwe Mann becoming the next presi-
dent, it is likely that the NLD will not challenge his economic empire nor
the economic interests of the elite connected with the previous regime.
3. The Rohingya crisis, ethnic conflicts and social issues
As noted at the beginning of this chapter, the elections of November

2015 are likely to represent a watershed in Myanmar’s politics. However,
the legacy of decades of military rule remains difficult to address. A major
obstacle is represented by ethnic insurgency along the Thai and the Chinese
borders. About 40% of present day Myanmar’s population belong to ethnic
minorities, which have historically felt underrepresented and suppressed
in the process that led to the creation of post-colonial Burma. The advent
of military rule made the conflict intractable as the army committed severe
human rights abuses not only against the insurgents but also against the
civilian populations belonging to ethnic minorities. To make the situation
even more complex, many rebel groups have become dependent on illegal
activities – drug trafficking, illegal trade of jade and precious stones – to
support their armies. The conflict over control of these illegal activities has
often been the real cause of confrontation between the Tatmadaw and lo-
cal militias. Furthermore, the hostilities between the ethnic groups and the
central government have often also become part of wider games involving
neighbouring countries Thailand and China.
The NLD has been accused in the past of scarce attention to the cause
of ethnic minorities, but in recent years has been able to improve its standing
in ethnic states, as witnessed by the results in the national and administrative
elections. On his side, Thein Sein made a settlement with ethnic insurgents
a priority of his government. One month before the election, the govern-
ment announced an important breakthrough: 8 of the 15 ethnic armies had
agreed to a cease-fire. A ceremony was held in Naypyidaw on 15 October
with Thein Sein, representatives of the insurgent groups and international
observers. Aung San Suu Kyi refused to attend, suggesting that the ceasefire
did not represent the breakthrough that the government suggested it to be.
27. Larry Jagan, ‘Myanmar president’s palace coup’, The Daily Star, 16 August
2015.
28. Giorgio Pescali, ‘Un processo di democratizzazione molto lento ma reale’,
p. 210.
306
MyanMar 2015
A rather sceptical view was expressed also by the international media. First,
the ceasefire only involved some, but not the largest, of the ethnic armies
and only those on the border with Thailand. Second, the terms of the agree-
ment remained quite elusive, while the negotiation of more critical issues
– including the monitoring of the ceasefire itself – was deferred to further
negotiations.29 Among the groups signing the agreement, the most notable
was the Karen National Union, which had been fighting the Burmese army
for 60 years. Other major groups refused to sign and government officers
even voiced the suspicion that China had discouraged ethnic Chinese groups
from participating in the negotiations.30
In May 2015, a refugee crisis related to the Rohingya – a Muslim minori-
ty from the Rakhine state – obtained international attention. At the beginning
of the month, graves were discovered by Thai authorities in a «waiting» area
at the border with Malaysia normally used by human traffickers. This tragic
discovery drew attention to the traffic of Rohingya and Bangladeshi people
across the Andaman Sea and eventually led traffickers to abandon thousands
of people on-board makeshift boats. For days, Thailand and Malaysia refused
to rescue these people until the crisis assumed worldwide visibility and inter-
national outcry forced them to act.31 The crisis shed light on the tragic condi-
tions in which this Muslim population live. Animosity between the Buddhist
majority of the Rakhine state and the Muslim minorities have roots in the
British colonial era, when ethnic tensions were deliberately used as a medium
to control local populations. Tensions between the Buddhist majority and the
Rohingya escalated into violent confrontation in 2012, largely as a result of
the political transition process for which the central government and local
politicians tried to exploit nationalism to attract consensus. Since then, about
140,000 Rohingyas were forced into squalid and crowded refugee camps, and
kept under apartheid-like conditions, with little access to education or ade-
quate medical care.32 These conditions were so terrible that the Simon-Skjodt
Centre of America’s Holocaust Memorial Museum, which campaigns to pre-
vent genocide, indicated that the Rohingyas are «at grave risk [of] additional
mass atrocities and even genocide».33
To please the most radical elements of the Buddhist clergy, in 2014
the Government Office drafted four bills as part of a «National Race and
Religion Protection» strategy giving legal coverage to discriminatory poli-
29. ‘Myanmar agrees limited ceasefire without most powerful rebel armies’,
The Guardian, 15 October 2015; ‘Myanmar signs ceasefire with eight armed groups’,
Reuters, 15 October 2015.
30. ‘Myanmar and 8 Ethnic Groups Sign Cease-Fire, but Doubts Remain’, New
York Times, 15 October 2015.
31. ‘Indonesia and Malaysia Agree to Take Rohingya and Bangladeshi Boat
Migrants’, Newsweek, 20 May 2015.
32. ‘Burma President Signs Off on Contested Population Law’, Irrawaddy, 24
May 2015.
33. ‘The most persecuted people on Earth?’, The Economist, 13 June 2015.
307
Pietro Masina
cies against the Muslim minorities. These bills were eventually signed by
Thein Sein in May 2015, right in the middle of the Rohingya refugee cri-
sis, making more dramatic an already appalling situation.34 Although these
discriminatory policies were directed against all the Muslim communities,
the Rohingya were particularly affected. Not only have they been progres-
sively marginalized from social and political life, but also many have long
been denied full citizenship.35 For the Rakhine majority the Rohingya do
not even exist as a distinct ethnic group as they are simply considered to be
illegal immigrants from Bangladesh who, therefore, should not be entitled
to Burmese citizenship. Historical evidence, on the contrary, suggests that
the Rohingya are the descendants of seafarers and traders from the Middle
East that settled in the kingdom of Arakan (present day Rakhine) in the 8th
Century and then intermarried with Bengali Muslim slaves.36
The events of May 2015 gave international visibility to the discrimina-
tion faced by the Rohingya. From an internal question it transformed into a
regional and international crisis when thousands of Rohingyas and Bangla-
deshi migrants were abandoned at sea by human traffickers. However, the in-
ternational visibility did not help to improve the situation of discrimination
faced by the Rohingya and the entire Muslim community. The inability to
address this interethnic conflict was also reflected in the November elections.
If the Thein Sein administration and the USDP were directly responsible for
the anti-Muslim policies harshly implemented since 2012, the same NLD
could not or did not want to distance itself from those policies. Not a single
Muslim candidate was included in the NLD lists at national and regional
level. The NLD claimed to have been forced to exclude Muslim candidates
because of the pressure of increasingly powerful ultranationalist Buddhist
monks. However, these claims do not reduce the disillusion of Muslims who
had previously supported the NLD.37 Even Aung San Suu Kyi was often criti-
cized abroad for her silence and ambiguity on the Rohingya cause. In an
interview given to the BBC immediately after the election, she indicated that
as the new country leader she intended to protect all citizens, independently
from their ethnic or religious background. 38 She also promised to punish
hate speeches, thus condemning the role of ultranationalist monks.39 Given
the very poor results obtained in the election by radical Buddhist candidates
34. Lynn Kuok, ‘Myanmar’s «Religious Protection» Laws: Widening the Rift’,
The Tony Blair Faith Foundation, 18 May 2015.
35. International Crisis Group, Myanmar: The Politics of Rakhine State, Asia Re-
port N°261, 22 October 2014.
36. ‘The most persecuted people on Earth?’, The Economist, 13 June 2015.
37. ‘No vote, no candidates: Myanmar’s Muslims barred from their own elec-
tion’, The Guardian, 3 November 2015.
38. ‘Myanmar election: Full BBC interview with Aung San Suu Kyi’, BBC World
News, 10 November 2015.
39. Ibid.
308
MyanMar 2015
and the large majority of seats that the NLD will control in parliament, the
NLD will be called to live up to these promises.
The November elections boosted the expectation that the country’s
economy was bound to rapidly expand and that living conditions were to
improve. However, a major natural disaster is expected to have a signifi-
cant negative impact on the national economy and on the livelihoods of
hundreds of thousands of citizens. In July 2015, the worst flooding in dec-
ades hit a large part of the country. By August, the situation had become
so critical that the government declared a state of emergency in four re-
gions.40 Hundred and three people died and up to one million more were
affected by the floods. Unlike in 2008, during Cyclone Nargis, when the
junta refused outside help, this time the government required and obtained
international aid.41 The floods compromised the main rice crop of the year,
although a precise estimate of the damage was still not available at the time
of writing this article. While climate change has probably been the cause
of higher-than-usual rainfalls, mismanagement of irrigation projects and
deforestation caused by logging certainly contributed to make the impact of
this natural disaster more severe.42 These problems are also likely to become
part of the agenda of the new NLD-led administration, although the many
vested interests connected with the non-sustainable exploitation of natural
resources will not allow easy fixes.
40. ‘Myanmar floods worst in decades’, BBC World News, 2 August 2015.
41. ‘Myanmar floods leave a million affected as death toll passes 100’, Interna-
tional Business Time, 10 August 2015.
42. ‘Flooding Spurs Disaster Zones in Myanmar’, New York Times, 1 August
2015.
309
bangladesh 2015: the eMergence oF radical islaM
Marzia Casolari
University of Turin
marzia.casolari@unito.it
The main issues that shaped Bangladeshi politics in 2015 were the emergence of
radical Islamic terrorism, the continuation of the trial related to the war crimes com-
mitted by pro-Pakistan organizations during the 1971 war of independence, the con-
tinuation of the Rana Plaza case, and the positive evolution of the bilateral relations
with India.
It is difficult to define the dividing line between the domestic and IS-related roots of
the wave of political violence which engulfed the country in the year under review.
But it is a fact that in 2015 Bangladesh was wracked by continuous attacks against
exponents of civil society, Christians, and foreigners.
In 2015 the targets of and strategy behind political violence changed. Unlike in
2013, when political violence reached heights unprecedented since 1971 and was
aimed mostly at political activists and agents of law enforcement, in 2015 violence
was directed mainly against common people, including children.
The dimensions of political unrest were such as to make many analysts fearful of there
being serious adverse consequences for the promising Bangladeshi economy. The mas-
sive infrastructure investments in 2015 had a setback and foreign investors withdrew
from Bangladesh’s industrial sector. However, in 2015 Bangladesh maintained its
approximately 6% GDP growth rate.
Ties with India were strengthened, in spite of the misgivings caused by Indian Prime
Minister Narendra Modi’s anti-Bangladeshi statements during his 2014 electoral
campaign.
1. Introduction
The main factors which characterised Bangladesh’s political evolution

in 2015 were the emergence of radical Islamic terrorism, the continuation
of the trials related to the war crimes committed by pro-Pakistani organisa-
tions during the 1971 civil war, the continuation of the Rana Plaza case1 and
the positive evolution of relations with India.
In a country which, since its foundation, has been dominated by a com-
bination of autocracy, political violence, Islamic extremism and terrorism,
the spread of the radical Islam threat was more than predictable. In such
1. Marzia Casolari, ‘Bangladesh in fiamme: dallo scontro politico alla guerriglia

urbana’, Asia Maior 2013, pp. 167-180.

Marzia Casolari
a climate, it is difficult to define the dividing line between the domestic

and IS (Islamic State) related roots of the wave of terrorism which engulfed
the country in the year under review. But it is a fact that, in 2015, Bangla-
desh was wracked by continual attacks against exponents of the civil society,
against Christians and foreigners, and by a massive return of political vio-
lence.2
It is worth stressing that, in 2015, political violence changed its targets
and strategy. In 2013, when it had reached unprecedented heights since
1971, violence was characterised by riots and hartals,3 which targeted mostly
political activists and law enforcing subjects.4 In 2015, violence was directed
mainly against the common people,5 including children. Its dimensions
were such as to make many analysts fearful of serious adverse consequences
even for the promising Bangladeshi economy.
The description of the violence that upset Bangladesh in 2015, which
will be given below, may seem exceedingly detailed. However, it is necessary
to realise that, although the international media have concentrated almost
entirely on the attacks taking place in the West, the same situation has held
true in other parts of the world, including Bangladesh. Indeed, Africans
and Asians were exposed to the same threats faced by Westerners.
2. The first anniversary of Hasina’s second term (and its aftermath)
The year began with the government’s restrictions over the celebra-
tions, on 5 January, of the first anniversary of the 2014 election and the op-
position’s protests, which signalled the return to «uncertainty in the political
landscape of Bangladesh».6
A few days earlier, police and sand-laden lorries had blocked Khale-
da Zia – leader of the main opposition party, the Bangladesh Nationalist
Party (BNP) – in her office in Dhaka, allegedly to protect her. Long-di-
stance bus services were suspended and gatherings were banned. Fakhrul
Islam Alamgir, the BNP secretary general, was arrested, while many other
party leaders went into hiding. Tariq Rahman, Khaleda Zia’s son living in
London to escape the consequences of corruption charges, publicly inci-
ted the Bangladeshi people to overthrow the government. The owner of
the television station that broadcast his speech was arrested, although al-
2. Marzia Casolari, ‘Bangladesh 2014: Old Patterns, New Trends’, Asia Maior
2014, pp. 223-240.
3. Mass demonstrations accompanied by the total shutdown of workplaces, of-
fices, shops, courts of law, etc.
4. Marzia Casolari, ‘Bangladesh in fiamme’, pp. 172-174, 167-180.
5. ‘IPCS Forecast: Bangladesh in 2015’, Institute of Peace and Conflict Studies
(IPCS) Website, 31 January 2015, p. 1.
6. Ibid., p. 2.
312
Bangladesh 2015
legedly not for political reasons, but because charged with pornography.
Mahfuz Anam, editor of the Daily Star, condemned the «mindless suppres-
sion of the opposition».7 Mohammad Ershad, former dictator and leader of
the Jatiya Party, Bangladesh’s third largest party and a League ally, warned
that his party’s ministers could quit the government.
The Awami League celebrated the anniversary as «Constitution and
Democracy Protection Day», while the opposition renamed it «Democracy
killing day».8 After the assassination of two BNP members, allegedly killed
by Awami League activists in the northern district of Natore, the BNP called
an indefinite national transport strike. The month-long blockade turned
immediately into turmoil. Bombs were thrown into two buses and about 60
people died in clashes.9
In spite of this new spell of violence, a year after her electoral success,
Sheikh Hasina seemed firmly in control and appeared to be strengthened
by international support. The US government, which in 2014 had expres-
sed much criticism of Hasina’s policy, «stopped putting public pressure on
the Bangladeshi government».10
In 2015, the trial against those responsible for war crimes during the
1971 liberation war continued, with two more executions.
3. The trial goes on
The trial against the 1971 war criminals, started by the Awami League
in 2010, went on among the usual controversies and violent retaliations.11
Since the beginning of the trial, the court had prosecuted 17 people.12 In
spite of internal and international criticism, the sentences were severe. In
February 2015, the tribunal ordered the execution of Abdus Subhan, age
79, former vice-president of the Jamaat-e-Islami (JI), declared guilty of six
out of nine charges, including murder, genocide and torture. According to
the prosecutors, during the 1971 war, Subhan was the head of the JI and of
a pro-Pakistani militia in the district of Pabna, in the north-west of Bangla-
desh. Subhan was accused of having murdered hundreds of villagers in his
area, most of them Hindus.
7. ‘Drama queens’, The Economist, 10 January 2015.

8. Ibid.
9. ‘On fire’, The Economist, 7 January 2015.
10. ‘Drama queens’.
11. Marzia Casolari, ‘Bangladesh. Crescita economica e mutamenti sociali in
un paese «nuovo»’, Asia Maior 2012, pp. 235-236; Marzia Casolari, ‘Bangladesh in
fiamme’, pp. 169-171; Marzia Casolari, ‘Bangladesh 2014’, pp. 228-230.
12. ‘Bangladesh orders top political figure to hang’, Al Jazeera, 18 February
2015.
313
Marzia Casolari
After the sentence was passed, some disorder occurred outside the
court, where three Molotov bombs were thrown by suspected opponents of
the government.13 On 16 June 2015, the Supreme Court upheld the death
penalty for 67 year old Ali Ahsan Mohammad Mojaheed, Jamaat-e-Islami’s
Secretary General, charged with abduction, torture, genocide and the kil-
ling of intellectuals. Mojaheed had been a minister in the Khaleda Zia go-
vernment between 2001 and 2006. The Jamaat-e-Islami immediately called
a 24-hour nationwide strike.14 At the end of July, the death sentence for the
opposition leader and former BNP Member of Parliament Salauddin Qua-
der Chowdhury, aged 68, was also upheld. Chowdhury was proved guilty of
nine charges out of 23, including genocide, murder, torment, and forced
and unfair extradition of people. Chowdhury committed the crimes while
supporting Pakistan’s occupation forces during the 1971 liberation war and
made use of his house in Chittagong as a torture detention centre. Among
Chowdhury’s victims were Sheikh Mozaffar Ahmed, the founder of the Awa-
mi League in Chittagong, and his son Sheikh Alamgir.
BNP and JI activists loudly protested against what they claimed to be
an unfair sentence. However these protests remained at the verbal level, as
the BNP and JI did not call for agitation. By then, after the three month
long nationwide blockade, the opposition was politically weakened.15
3.1. The executions
On 18 November, the Supreme Court rejected the petitions filed by Ali

Ahsan Mohammad Mojaheed and Salauddin Quader Chowdhury and once
again upheld the death sentences. The Jamaat called for protests the fol-
lowing day,16 but to no avail, as the two men were hanged on 22 November.
The opposition immediately called for a general strike but, in order to pre-
vent major disorders, thousands of police and border guards were deployed
in Dhaka, Faridpur and Raojan, respectively Mojaheed’s and Chowdhury’s
hometowns, where the funerals were held on the morning of 22 November.
The Awami League’s supporters greeted the executions and held parties
in the streets, distributing sweets17 while, thanks to the massive police de-
13. Ibid.
14. ‘Bangladesh upholds death sentence for top Islamist for war crimes’, Asia
Times, 16 June 2015.
15. ‘Ex-opposition leader’s death sentence in Bangladesh open old wounds’,
Asia Times, 31 July 2015.
16. ‘Death sentences for two Bangladesh leaders upheld’, Al Jazeera, 18 Novem-
ber 2015.
17. ‘Bangladesh hangs opposition figures for war crimes’, Al Jazeera, 22 Novem-
ber 2015.
314
Bangladesh 2015
ployment, protests were muted. The general strike went on without demon-
strations and the day was peaceful.
The Prime Minister has, however, been sharply criticised. Since the
beginning of the trial, the main charge was that Sheikh Hasina was exploi-
ting the trial for political gain. Some analysts warned that the executions
might provoke further bloodshed in Bangladesh. However, it is a fact that
an overwhelming majority of people were in favour of the trial and the exe-
cution of the war criminals.18
The issue provoked tensions with Pakistan. On 22 November, Paki-
stan’s Foreign Minister Hina Rabbani Khar expressed «deep concern and
anguish» over the executions.19 This statement provoked an immediate
reaction from the Bangladeshi Foreign Minister, A.H. Mahmud Ali, who
publicly criticized his counterpart and recalled the Bangladeshi envoy in
Dhaka. As a response, Pakistan’s Foreign Ministry recalled its deputy High
Commissioner in Bangladesh.20
Some observers pointed to the trial as the main source of political
polarisation,21 but this view appears simplistic and biased to this author.
Even if the death penalty is objectionable, justice had to be done for the
1971 war crimes.
While the sentences were issued and the political confrontation turned
increasingly bitter, violence proliferated and manifested itself in a number
of attacks against multiple targets, especially exponents of the secular civil
society and minorities.
4. Political violence and its multiple shapes
By the end of February 2015, strikes, blockades, protests and arson

had caused 30 deaths (many, including children, burned to death) and hun-
dreds of injuries, while more than 7,000 people had been arrested.22 Many
analysts compared the 2015 violence with the 2013 riots, but the 2015 wave
of violence differed from that of two years previously. In 2013, the violence
took the shape of clashes between at least two different factions: the sup-
porters of the Awami League government and its opponents, especially the
18. ‘Bangladesh PM’s gains from shock hangings seen short-lived’, Asia Times,
25 November 2015.
19. ‘Pakistan deeply disturbed by Bangladesh executions: FO’, Dawn, 22 November
2015.
20. ‘Dhaka to review ties after Islamabad’s concern over execution of 2 war
criminals’, Asia Times, 6 December 2015.
21. ‘Execution of Bangladesh war criminals may trigger more revenge attacks’,
Asia Times, 5 December 2015.
22. ‘30 dead as Bangladesh political violence escalates’, The Guardian, 23 Jan-
uary 2015.
315
Marzia Casolari
BNP and Jamaat-e-Islami followers. In contrast, as already pointed out, the

violence in 2015 was indiscriminate, directed against the common man,
characterised by attacks on the crowd carried out by politically oriented
gangs trained in urban guerrilla actions. Buses were the preferred targets:
bombs were thrown inside them or they were set on fire, causing severe
casualties and panic. Moreover, private properties and vehicles were loo-
ted and damaged or destroyed. By the end of January 2015, more than
600 motorcycles had been burned. The perpetrators were clearly connected
with the opposition, especially with the BNP. The violence was indeed the
uncontrolled result of the BNP’s call for strikes. The outburst of violence
in February 2015 has been correctly defined «as the most anti-people, uni-
maginative, cruel and destructive programme that the BNP is embarking
on».23 This agenda alienated the already low public support for the BNP
and other opposition parties.
In the following months, the features of the violence changed and dif-
ferentiated. They took three main shapes: attacks against secular writers
and media people, especially bloggers; attacks on foreigners and minori-
ties, especially Christians; and terrorism.
4.1. Secular and independent media under attack
In 2015, four bloggers were hacked to death. All the killings were exe-
cuted with identical modality. All the victims were attacked by masked assai-
lants who acted in groups of between two and four men. All the victims were
butchered with cold weapons, such as machetes, knives or meat cleavers. On
26 February 2015, Avijit Roy, a US national born to a Bangladeshi Hindu
family in 1972, was killed in the street in Dhaka. His wife, Rafida Ahmed
Bonia, was also seriously injured in the attack. On his Facebook profile, Roy
defined himself «as an engineer by profession and a writer by passion».24
Avijit Roy had founded his own blog, Mukto Mona, and also contributed to
other blogs and newspapers. He had authored about ten books on seculari-
sm and against religious fanaticism. Roy’s most famous book was Biswasher
Virus («Virus of Faith»). In his writing, he frequently compared religion to
a disease and denied any scientific reliability in the Koran. His views about
Islam were very radical, as he did not acknowledge the existence of any
tolerant stream in the Muslim religion. Roy publicly condemned the attack
on the school in Peshawar and on Charlie Hebdo in Paris, and debated
provocative issues like homosexuality, upsetting many conservative Bangla-
23. ‘IPCS Forecast’, p. 1; ‘Bangladesh and Nepal: Review of IPCS Forecast’,

IPCS, 23 February 2015.
24. ‘Avijit Roy, the blogger who wouldn’t back down in the face of threats’, The
Guardian, 27 February 2015,
316
Bangladesh 2015
deshis.25 In spite of death threats, Roy had just arrived from the US a week
before being killed. On 29 March 2015, another secular blogger, Washiqur
Rahman Babu, age 27, was assassinated in Dhaka. He was so maimed that
the police identified him from his voter card. Washiqur Rahman had atta-
cked the fundamentalists in his blog.26 On 12 May 2015, Ananta Bijoy Das,
32 years old, was murdered in Sylhet. Das was a banker, a progressive writer
and editor of the science fiction magazine Jukti. He was also an activist in
the Gonojagoron Mancha («People’s Resurgence Platform»), an organisa-
tion connected to the Shahbag Square movement, supporting the Interna-
tional Crimes Tribunal and the death penalty for the criminals.27 Das was
connected with Avijit Roy, as he had written blogs for Roy’s Mukto Mona. Das
had also criticised Islamic fundamentalism in his blog. Within a few hours
of Das’ murder, a message was posted on Twitter by somebody concealing
himself behind the nickname «Ansar Bangla 8», claiming responsibility for
assassinating the blogger. Apparently, the nickname referred to the Ansar
Bangla or Ansarullah Bangla Team (ABT), namely an extremist organisa-
tion implicated in various criminal activities, including murder and bank
robbery. The same username later tweeted the message: «Al-Qaeda in In-
dian Sub-Continent (AQIS) claimed responsibility of [sic] killing Ananta
Bijoy in Sylhet.».28 AQIS posted another message in Justpaste.it, threatening
those who insulted Allah and the Prophet Mohammed.29
The police headquarters asked the Home Ministry to ban ABT for
its involvement in several attacks on secular bloggers and writers.30 One
more attack took place on 6 August, when 28 year old Niloy Chatterjee—
25. Among Avijit Roy’s books: In Search of Life and Intelligence in the Universe
(2007); Caravan of Darkness Walking with Light in Hand (2008); Homosexuality: A Scientif-
ic and Socio-psychological Investigation (2010); The Philosophy of Disbelief (2011); ‘Secular
publisher hacked to death in latest Bangladesh attack’, The Guardian, 31 October
2015.
26. ‘Washiqur Rahman: Another secular blogger hacked to death in Bangla-
desh’, CNN, 31 March 2015.
27. Marzia Casolari, ‘Bangladesh in fiamme’, pp. 169-171.
28. ‘Al-Qaeda’s Indian offshoot claims responsibility for blogger Ananta’s mur-
der, says Ansar Bangla 8’, bdnews24.com, 12 May 2015.
29. ‘Al-Qaeda in Indian Subcontinent claims responsibility for murder of Bang-
ladesh blogger Ananta Bijoy Das’, DNA, 12 May 2015.
30. The attacks had a huge resonance in the English language press. The fol-
lowing is a selection of articles on the subject: ‘Avijit Roy was hacked to death for his
secular views. Let’s share his story’, The Guardian, 2 March 2015; ‘Washiqur Rahman:
Another secular blogger hacked to death in Bangladesh’, CNN, 31 March 2015; ‘Ban-
gladesh murdered bloggers: Avijit Roy, Washiqur Rahman and Ananta Bijoy Das,
BBC, 12 May 2015; ‘Bangladeshi secular blogger Ananta Bijoy Das hacked to death in
third fatal attack this year’, The Washington Post, 12 May 2015; ‘Secular blogger Ananta
Bijoy Das hacked to death in Bangladesh’, The Guardian, 13 May 2015; ‘Bangladesh
must act on these brutal attacks on bloggers’, Al Jazeera, 21 May 2015; ‘Bangladesh:
Freedom and Death’, Asia Times, 18 May 2015.
317
Marzia Casolari
pen name Niloy Neel—was killed in his flat in Dhaka. Chatterjee too was
a Hindu and belonged to the Gonojagoron Mancha. Responsibility for the
murder was claimed by an organisation named Ansar al-Islam, apparently
a local affiliation of Al-Qaeda. Niloy’s wife reported that her husband had
tried to file a complaint about having been threatened, but the police had
refused to receive it.31
On 31 October, two attacks took place in Dhaka against two publishers.
Both had printed Avijit Roy’s books. During the first attack, the office of the
Shudhdhoswar publishing house was assaulted by three men carrying cold
weapons. The publisher, Ahmed Rahim Tutul, was in a conversation with
two writers when the killers broke into his room. Both Tutul and the two
writers were seriously wounded and had to be hospitalised.32 During the
second attack, which occurred a few hours later, Faisal Arefin Dipan, head
of the publishing house Jagriti Prakashani, was assaulted in his office in the
Shahbag area and stabbed to death.33 Both publishers had filed a complaint
with the police claiming they were being threatened.34 However, in these
cases again the police did not take any precautions.35
The attacks on the two publishers have been claimed by AQIS’s affilia-
te Ansar-al-Islam. In a message sent to the media, Ansar-al-Islam asserted:
«These two publishers were worse than the writers of such books, as they
helped to propagate those books and paid the blasphemers [a] handsome
amount of money for writing them».36
After the attacks on the publishers, writers and citizens alike turned
out in large numbers for a rally on the streets of Dhaka on 3 November,
asserting the right to free speech.37
The attacks on bloggers and publishers have been strongly criticised by
several eminent voices including the Committee to Protect Journalists, the
Blogger and Online Activist Network, and Human Rights Watch, who urged
31. ‘Fourth secular Bangladesh blogger hacked to death’, Al Jazeera, 7 August

2015; ‘Bangladesh, blogger ucciso a Dacca. È il quarto dall’inizio dell’anno’, la Repub-
blica, 7 August 2015; ‘Islamists use machetes to hack to death Bangladeshi blogger in
his home in Dhaka’, The Daily Mail, 7 August 2015; ‘Fourth secular blogger hacked
to death in Bangladesh’, The Hindu, 8 August 2015; ‘Endangered blogger’, Frontline,
19 August 2015.
32. ‘Secular publisher hacked to death in latest Bangladesh attacks’, The Guard-
ian, 31 October 2015.
33. Ibid.
34. ‘Al-Qaeda affiliate claims killing of secular publisher in Bangladesh’, Asia
Times, 31 October 2015.
35. ‘Bangladesh blogger killed by machete gang had asked for police pro-
tection’, The Guardian, 7 August 2015; Sanjana Hariprasad, ‘Is Bangladesh Doing
Enough To Protect The Freedom Of Speech Of Its Citizens?’, South Asia Program At
Hudson Institute, 9 November 2015.
36. ‘Al-Qaeda affiliate claims killing of secular publisher in Bangladesh’.
37. ‘Bangladesh writers stage freedom rally despite fear of attacks’, Asia Times,
3 November 2015.
318
Bangladesh 2015
Sheikh Hasina to take steps to ensure the safety of secular writers in Ban-
gladesh.38 About 150 writers, including Salman Rushdie, Margaret Atwood,
Yann Martel and Colm Tóibín, signed a letter condemning the attacks and
asking the government to take measures to prevent similar events.39
The role of the police is not clear. At least three victims had sought help
from the police, who did not take any steps to protect them, even when the
blogger issue had clearly become an emergency. The Inspector General of
Police, after defending the free thinkers, declared that respecting religious
feelings is a duty, so much so that: «Any offender of religious beliefs may get
the highest punishment of 14 years».40 Many labelled the Bangladeshi blog-
gers «atheists», but none of them published any blasphemous message.41
The attacks had several aspects in common: the targets, the methods
and the weapons. As far as the methods are concerned, they were clearly
inspired by the Charlie Hebdo assault. This aspect can be explained in two
ways. The attackers may have been affiliated to IS and therefore shared its
targets and methods; or they could just be politically motivated local gangs,
who flaunted their affiliation to radical Islam and emulated its methods,
but pursued different goals, most probably connected to local politics. The
victims have some common features. Two were Hindus and two belonged
to Gonojagoron Mancha. They were not common people, but they had the
capacity to voice some of the values that the government was trying to pro-
mote, like the trial of the war criminals, secularism, freedom of speech and
belief. These assassinations, therefore, could not just be directed against the
offenders of Islam, as officially claimed, but targeted government policies,
particularly the war crimes trials. Gonojagoron Mancha started in 2013 in
connection with the above quoted Shahbag Square movement and can be
considered the Shahbag online voice. Gonojagoron Mancha rapidly became
a nationwide movement, demanding capital punishment for war criminals
and safeguarding of the «nation’s secular ideals that were attained through
the liberation war in 1971».42
In September 2015, the ABT published a hit list of 18 secular bloggers,
writers and activists to be killed if they did not stop criticising radical Islam
or writing about «blasphemous» topics. The targets were not only Bangla-
deshis living in the country, but also Bangladeshi nationals based abroad,
individuals with dual nationality, and citizens of Western countries. The list
38. ‘Secular blogger Ananta Bijoy Das’.

39. ‘Militant group publishes global hitlists of bloggers, activists and writers’,
The Guardian, 23 September 2015.
40. ‘Bangladesh protesters demand justice in wake of latest blogger murder’,
Asia Times, 10 August 2015.
41. Nilanjana S Roy, ‘The hit list: Endangered bloggers of Bangladesh’, Al Jazeera,
14 August 2015; Aroon Habib, ‘Endangered bloggers’, Frontline, 4 September 2015;
Oshua Hammer, ‘The Imperiled Bloggers of Bangladesh’, The New York Times, 29
December 2015.
42. ‘Endangered bloggers’.
319
Marzia Casolari
includes nine persons living in the UK, seven in Germany, two in the US
and one in Canada.43 A prominent name in the list was Taslima Nasreen,
who has lived under police protection in India for the past 21 years, after
receiving death threats from Muslim fundamentalists.44 Some individuals in
the list declared their decision to continue writing and blogging. Some of
them approached the police after the publication of the list. The authorities
seem to have taken the matter seriously and advised the writers to take pre-
cautions to reduce the risk of attack.45
It is unclear if the ABT has the capacity to act abroad, but the publi-
cation of the list may be a call for action potentially capable of triggering
a witch hunt outside Bangladesh. The publication of the black list, indeed,
may call for «lone wolf» action around the world.46
4.2. Attacks on foreigners and religious minorities
On 28 September, the Italian aid worker Cesare Tavella was killed on

a street in Gulshan, Dhaka’s diplomatic area, while he was jogging. A 50
year old veterinary surgeon, Tavella was working as project manager for the
Dutch NGO ICCO, within the programme Cooperation’s Profitable Oppor-
tunities for Food Security (PROOFS). Witnesses reported that the assailants
fled on a motorcycle and that one of them was carrying a gun. The forensic
expert Qazi Md Abu Sharma, after inspecting Tavella’s body, told the media
that the Italian aid worker had been «shot three times from behind at clo-
se range» with a revolver.47 The American SITE Intelligence Group, which
monitors online activities of radical Islam, reported a statement released
shortly after the murder, where IS claimed that a «security detachment» had
tracked Tavella through the streets of Dhaka and killed him with «silenced
weapons». The statement warned that foreigners should not feel confident
in Muslim lands. It announced more attacks in Bangladesh on citizens be-
longing to «the crusader coalition».48 The «crusader» Tavella had chosen
43. ‘Militant group publishes global hitlists of bloggers, activists and writers’.
44. ‘Bangladesh jihadist group includes Taslima Nasreen in global hit list of
bloggers’, India TV Website, 25 September 2015.
45. ‘Militant group publishes global hitlist of bloggers, activists and writers’, The
Guardian, 23 September 2015.
46. ‘Militant group publishes global hitlists of bloggers, activists and writers’.
47. ‘Cesare Tavella, il veterinario che voleva insegnare ad allevare animali nei
Paesi più poveri’, La Stampa, 28 September 2015; ‘Italiano Cesare Tavella ucciso in
Bangladesh’, ANSA, 29 September 2015; ‘Security alerts issued for foreigners in Ban-
gladesh following aid worker’s murder’, Asia Times, 29 September 2015; ‘Bangladesh
PM blames opposition parties for foreigner murders’.
48. ‘Cesare Tavella, Isis rivendica l’omicidio del cooperante italiano: «Colpito
uno spregevole crociato»’, Il fatto quotidiano, 28 September 2015; ‘Bangladesh, Islamic
State militants claim murder of Italian volunteer’, Asia News, 29 September 2015;
320
Bangladesh 2015
to work in Bangladesh (as he did in several other developing countries) to

train farmers to breed cattle.49
According to the Bangladeshi authorities, Tavella’s murder was plan-
ned, but he was not the objective. The attack was rather directed against the
Western presence, activities and interests in Bangladesh. The Bangladeshi
authorities and the Prime Minister denied the presence of IS cells in Ban-
gladesh.50
According to the Italian diplomatic and intelligence authorities coo-
perating with the Bangladeshi investigators, the attack was deliberately di-
rected against Tavella, yet the reasons for the murder had to be clarified.51
However, the thesis supported by the Bangladeshi authorities, according
to which the terrorists’ targets were not specific individuals but foreigners
as such, seems to be more plausible, as shown by the assassination of a 65
year old Japanese farmer, Kunio Hoshi, on 3 October. Kunio was killed
by three masked gunmen, who shot him while he was on the way to his
farm in Rangpur.52 The murder was claimed on the same day by the IS,
but the Prime Minister, who met the journalists at her residence on 4 Oc-
tober, once again denied any IS involvement. She asserted that the killings
of the two foreigners were «part of a conspiracy to tarnish the image of
the government».53 The paradoxical nature of these rather indiscriminate
attacks is highlighted by the fact that Kunio Hoshi had recently converted
to Islam.54 The murderers kill people who are either concerned about Ban-
gladesh’s development or who share their assailants’ faith.
The murders of two foreigners in less than a week increased the
alarm of Western authorities. Before the killings, the Australian and Bri-
‘ISIS Says it Killed Italian Aid Worker in Bangladesh’, The New York Times, 29 Sep-
tember 2015; ‘Islamic State claims shooting death of Italian aid worker, first attack in
Bangladesh’, ABC, 29 September 2015; ‘ISIS claims responsibility for death of Italian
man in Bangladesh’, The Guardian, 29 September 2015; ‘IS claims responsibility for
killing Italian in Dhaka, The Hindu, 30 September 2015; ‘ISIS Says it Killed Italian
Aid Worker in Bangladesh’, The New York Times, 29 September 2015; ‘Islamic State
claims shooting death of Italian aid worker, first attack in Bangladesh’, ABC, 29 Sep-
tember 2015; ‘ISIS claims responsibility for death of Italian man in Bangladesh’, The
Guardian, 29 September 2015; ‘IS claims responsibility for killing Italian in Dhaka’,
The Hindu, 30 September 2015; Shrug off IS angle’, Asia Times, 5 October 2015.
49. ‘Cesare Tavella, il veterinario’.
50. ‘Bangladesh, Islamic State militants’; ‘Bangladesh PM blames opposition
parties for foreigner murders; Shrug off IS angle’, Asia Times, 5 October 2015.
51. ‘Cesare Tavella, Isis rivendica’.
52. ‘Masked gunmen kill Japanese national in Bangladesh’, Al Jazeera, 3 October
2015.
53. ‘Second foreigner killed in Bangladesh as Isis claims responsibility’, The
Guardian, 3 October 2015; ‘Bangladesh denies Islamic State link in murder of Japa-
nese national’, The Japan Times, 5 October 2015.
54. ‘Japanese Kunio Hoshi converted to Islam three months before murder,
locals claim’, bdnews24.com, 5 October 2015.
321
Marzia Casolari
tish embassies had informed their citizens that «there is reliable informa-
tion to suggest that militants may be planning to target Western interests in
Bangladesh».55 After Tavella’s murder, the Canadian Embassy issued a web
site alert to its nationals, informing them that «attacks cannot be ruled out
and could be indiscriminate. Terrorist attacks could occur at any time and
could target areas frequented by expatriates and foreign travellers. Limit
your attendance at events where Westerners may gather, for example in ho-
tels or conference centers».56 The message issued by the American authori-
ties warned that «in case of increased threat, US citizens should maintain a
high level of vigilance and situational awareness and should exercise caution
in public places including restaurants, hotels and other places frequented
by foreigners».57 Before Tavella’s killing, Cricket Australia (CA) delayed the
arrival of its cricket team in Bangladesh because of security concerns. The
Australian authorities had received «reliable information» on the possibili-
ty of attacks by Islamic militants. A few hours before Tavella’s murder, the
Bangladesh authorities had already provided the Australian team with the
highest security.58
Attacks on foreigners represent a serious threat to Bangladeshi busi-
ness, which depends upon foreign investments, export of Bangladeshi go-
ods and delocalisation in Bangladesh. One of the main disruptive effects of
the climate of terror spreading in the country is its negative consequences
for the economy. Investors – especially in the ready-made garment sector,
which is the backbone of Bangladesh economic development – have cancel-
led their trips to the country.59
Sheikh Hasina promised prompt action to capture the culprits of the
attacks on foreign citizens.60 Once more, the government blamed the oppo-
sition for the violence against foreigners.61
On 5 October, a 52 year old Bangladeshi pastor from Pabna survived
a vicious assault by three men who came to his house, pretending to be
interested in learning about Christianity. The assailants, between 25 and
30 years old, attacked the pastor with knives. The man suffered minor in-
juries.62 Less than two weeks later, on 18 November, an Italian missionary
and doctor, Piero Parolari, was gunned down by three men while riding his
55. ‘Security alerts issued for foreigners in Bangladesh following aid worker’s
murder’, Asia Times, 29 September 29, 2015.
56. Ibid.
57. Ibid.
58. ‘Security alerts issued for foreigners in Bangladesh following aid worker’s
murder’.
59. ‘Terror experts question Islamic State involvement in Bangladesh bombing
despite claim’, Asia Times, 26 October 2015.
60. ‘Bangladesh PM’.
61. Ibid.
62. ‘Bangladeshi pastor survives knife attack at his home’, Asia Times, 6 October
2016.
322
Bangladesh 2015
bicycle to church in Dinajpur. The assailants fled on a motorbike. The priest

survived the wounds. Parolari had been living in Bangladesh since 1984.63
IS claimed responsibility for the attempt.64
Alok Sen, leader of the Hindu-Bouddho-Christian Unity Parishad in
Faridpur, survived an assassination attempt. The assailants were armed
with kitchen knives. The attempt on the religious leader took place on 24
November, the day after Ali Ahsan Mohammad Mojaheed’s burial in Fa-
ridpur.65
Besides the attempts on individuals, the terrorists carried out attacks
on religious crowds and holy places. The Shia community was repeatedly
targeted between October and December. The first strike took place on 24
October, the day of Ashura, when a series of bomb blasts killed a boy and
wounded over a hundred people gathered for a procession in the old part of
Dhaka. When claiming responsibility for the attack, IS defined the religious
gathering as «polytheist rituals».66
An almost identical attack killed 16 people during a Shia procession in
Pakistan hours earlier, but the Bangladeshi Home Minister, Asaduzzaman
Khan, denied any involvement of extremists or any connection between the
two attempts. The minister, as usual, blamed the opposition for «aiming
only to destabilize the situation of the country».67 The attack provoked con-
sternation in the country, as the day of Ashura in Bangladesh has been pea-
cefully celebrated for some four hundred years and the Shia community had
rarely been under attack in the past.
National and international experts, including the Italian Ambassador
and the Italian media,68 shared the Home Minister’s doubts about IS in-
volvement in the violence that upset the country throughout the year. An
international relations expert who did not want to be identified noted that
militant organisations have the tendency to attack targets where «casualties
are likely be higher», ensuring that their names make headlines across the
63. ‘Bangladesh: missionario italiano ferito in un attacco armato’, Rai News, 18

November 2015; ‘Italian priest attacked by 3 gunmen on bike in Bangladesh’, Asia
Times, 18 November 2015.
64. In the statement, the assailants also claimed an attack on a member of the
Bahai religion and the murder of the politician Rahma Ali. ‘Islamic State claims at-
tack on Italian missionary in Bangladesh’, Asia Times, 19 November 2015; ‘Bangla-
desh, missionario italiano ferito in un attacco armato’, Corriere della sera, 18 Novem-
ber, 2015; ‘Bangladesh, ferito un prete italiano’, il Giornale, 18 November 2015; ‘L’Isis
rivendica l’attacco a un missionario italiano in Bangladesh’, Il Sole 24 ore, 19 Novem-
ber 2015. The Italian media also reported the attack on the Shia mosque in Dhaka.
65. ‘Leader of religious unity forum attacked in Bangladesh’, Asia Times, 24 No-
vember 2015.
66. ‘Islamic State claims responsibility for Bangladesh bombings on Shias’, Asia
Times, 24 October 2015.
67. Ibid.
68. ‘Cesare Tavella, Isis rivendica’.
323
Marzia Casolari
world. «By all means, this seems to be a conspiracy at maligning [sic] the
global image of Bangladesh», he said.69
On 26 November, three young men stormed into a small mosque in the
Bogra district and opened fire indiscriminately on the worshippers during
the function after locking the main gate. The muezzin was killed and three
people were wounded. The attack has been claimed by IS, but the authorities
continued to question IS’s involvement and suspected that the banned Ja-
maat-ul-Mujahideen Bangladesh (JMB) might have been behind the attack.70
On 5 December, three crude bombs exploded outside Kantaj Temple
in Dinajpur during a religious gathering. At least ten people were injured,
three of them seriously.71 The attempt took place in Faridpur, Ali Ahsan Mo-
hammad Mojaheed’s birthplace, the same area were Parolari was assaulted
a month earlier.
IS involvement in the attacks in Bangladesh is not beyond doubt. The
hypothesis that the mainstream opposition parties may exploit radical Islam
as an instrument to destabilise the country and topple the government can-
not be discarded. Indeed, this hypothesis is shared by most analysts and
by the Bangladeshi government alike. As shown above, the latter has con-
sistently denied the affiliation of the killers to Islamic State and «blamed
domestic Islamist militants and parties for orchestrating the violence in a
bid to destabilise the nation».72
5. A wave of arrests
At the time of writing this text, the attitude of the police regarding
the assassinations was unclear. As already seen, in some cases the police
did not take proper action to protect the victims who reported harassment
and did not take any measures to protect them. The Bangladeshi authori-
ties have been under international pressure, including in consideration of
the high exposure of foreign citizens living in Bangladesh and the size of
foreign investments in the country. The police’s reaction only came in Au-
gust 2015, perhaps after government pressure. Since then, the police have
become very efficient and have carried out a series of notable arrests. When
the violence against foreigners became an embarrassing issue, the police,
about a week after Niloy’s August assassination, arrested two suspects, Saad
69. ‘Terror experts question Islamic State involvement in Bangladesh bombing

despite claim’.
70. ‘Islamic State claims responsibility for Bangladesh mosque attack’, The
Guardian, 27 November 2015; ‘Bangladesh: Local militants stage «IS» raids to be-
come noticed by the terror group’, Asia Times, 3 December 2015.
71. ‘10 hurt in bomb attack on Hindu gathering in Bangladesh’, Asia Times, 5
December 2015.
72. ‘Secular publisher hacked to death in latest Bangladesh attack’.
324
Bangladesh 2015
al-Nahin and Masud Rana, both members of the banned ABT. Nahin was
on bail on the charge of attempted murder of another blogger in 2013.
A further three men were arrested shortly afterwards, on 17 August 2015.
They too belonged to the ABT. According to a spokesman for the Rapid Ac-
tion Battalion, a paramilitary police unit, Touhidur Rahman, a 58 year old
British national of Bangladeshi origin, was the «mastermind and financier
of the attacks» on Avijit Roy and Ananta Bijoy Das.73 Another of the three
arrested, Sadek Ali Mithu, 28, acted as the «bridge» with the alleged head
of the ABT, Mufti Jasim Rahmani, in jail for the assassination of a blogger
in 2013. The third man arrested, Aminul Malik, 35, apparently was not
directly involved in the murders, but helped the ABT militants to escape
abroad by furnishing them with forged passports. By the beginning of Sep-
tember, the police had arrested seven militants.74
Cesare Tavella’s alleged killers were arrested a month after his assassi-
nation, on 26 October 2015. Dhaka police held four people, three of whom
have been identified as Tavella’s killers.75 The suspected assailants of the
Italian priest Piero Parolari were held immediately after the attack. The
Secretary General of the Jamaat-e-Islami, Mahbubur Rahman Bhutto, has
been arrested, while ten more people have been held in custody.76
At the end of November, the police detained two members of the Ja-
maat-e-Islami. One of them spread pro-Caliphate propaganda on Facebook
under the pseudonym Jihadi John.77
On the evening of 4 November 2015, commandos, armed with ma-
chetes, rode on motorbikes up to a checkpoint in Baroipara, in the Dhaka
suburbs, and assaulted the stationing policemen. Three were seriously inju-
red and one was killed. Most probably the attempt was a retaliation against
the police for the crackdown of the previous months.78 Between October
73. ‘Bangladesh police arrest 3 suspects in bloggers’ murder’, Asia Times, 18

August 2015.
74. ‘Two suspected Islamists arrested over killing of secular Bangladeshi blog-
ger’, The Guardian, 14 August 2015; ‘Bangladesh police arrest 3 men in bloggers’ mur-
ders’, The Globe and Mail, 18 August 2015; ‘Arrests in Bangladesh blogger murder case
fail to allay fears’, Asia Times, 18 August 2015; ‘Bangladesh arrests three men in-
cluding Briton over murders of secular bloggers’, The Guardian, 18 August 2015;
‘Bangladesh police charge «Islamist militants» over atheist’s murder’, The Guardian,
1 September 2015.
75. ‘Four held in Bangladesh over murder of Italian aid worker’, Asia Times, 26
October 2015, ‘Bangladesh: arrestate 4 persone per l’omicidio del cooperante Tavel-
la’, Corriere della sera, 26 October 2015; ‘Bangladesh, quattro arresti per l’omicidio del
cooperante italiano Cesare Tavella’, TGCOM24 Website, 26 October 2015.
76. ‘Bangladesh, Isis rivendica l’attacco al missionario italiano’, Corriere della
sera, 19 November 2015.
77. ‘Bangladesh detains «Jihadi John» for IS propaganda’, Asia Times, 25 No-
vember 2015.
78. ‘Progress fan flames of militant unrest in changing Bangladesh’, The Guard-
ian, 7 November 2015.
325
Marzia Casolari
and November, another three attacks on policemen were carried out and
another officer was killed.79
At the end of the year, on 24 December, the police raided a building
in the capital and seized a massive quantity of weapons and explosives, in-
cluding bombs, grenades, suicide belts and substances to produce at least
200 bombs. In the operation, the police detained seven men associated with
the banned Jamaatul Mujahideen Bangladesh. When the raid started, the
militants exploded bombs, fortunately without consequence.80
Apart from the arrests, the Bangladeshi government also took several
measures to combat radicalism at the international level. According to secu-
rity and intelligence sources in Dhaka, Bangladeshi diaspora communities
in the UK finance and encourage young Bangladeshi radicals to join the
international jihad. The Jamaat-e-Islami is very active in East London. Two
of three British citizens recruited by IS and killed by drone strike in Syria in
August 2015 were of Bangladeshi origin. Sheikh Hasina urged David Came-
ron «to do more to combat radicalism, as British jihadists play a prominent
role in fomenting the Muslim radicalism in Bangladesh». «The British go-
vernment should take more steps on the ground», the Bangladeshi Prime
Minister told the press.81
In November, the Bangladeshi government, considering that the crimi-
nals made use of apps and social media, decided to block Viber, WhatsApp
and the social media for some days. On 11 November, the Prime Minister
announced to parliament the decision to suspend the internet connection
in the country for some days.82 Most probably, the internet blackout allowed
the Bangladesh Telecommunication Regulatory Commission (BTRC) to put
into operation Internet Safety Solutions, a system to monitor the social me-
dia and cyber activities. Several agencies have been involved in efforts to
prevent cybercrimes.83
On 23 December, the second secretary in Pakistan’s high commission
in Dhaka, Farina Arshad, was recalled to Islamabad following a request by
79. ‘Bangladesh to block messaging and calling apps following terror attack on
law enforcement’, Asia Times, 12 November 2015.
80. ‘Bangladesh detains members of banned armed group’, Al Jazeera, 24 De-
cember 2015; ‘Bangladesh arrests seven suspected Islamist terrorists’, The Guardian,
24 December 2015.
81. ‘British jihadis in Bangladesh fanning flames of extremism, says Dhaka’,
The Guardian, 16 September 2015. In September 2014, the Bangladeshi police had
arrested a British citizen of Samiut Rahman, suspected of recruiting fighters for the
Islamic State: ‘British ISIS suspect is arrested in Bangladesh on suspicion of recruit-
ing jihadists to fight in Syria’, Daily Mail, 29 September 2014.
82. ‘WhatsApp, Viber to be blocked, when needed: PM’, The Daily Star, 11
November 2015; ‘Internet access restored in Bangladesh after brief shutdown’, bd-
news24.com, 18 November 2015.
83. ‘Bangladesh to block messaging and calling apps following terror attack on
law enforcement’.
326
Bangladesh 2015
the Bangladeshi authorities. She was suspected of having financed a mem-

ber of the Jamaatul Mujahideen Bangladesh on trial for espionage.84
6. Bangladesh’s Muslim radicalism: identity and financial sources
In a year, the Bangladeshi authorities arrested 15 IS suspects.85 Ne-

vertheless, official sources continued to deny any IS involvement in the se-
ries of bloody attacks that shocked the country in 2015. Most attacks and
murders have been claimed by IS and most of the arrested seem to have
actually been connected with the group. However, as maintained by the go-
vernment, the opposition may be involved in most, if not all, the attacks,
through its militant wing, the Jamaat-e-Islami.
In a context like the intricate Bangladeshi political scene, it is difficult to
identify the dividing line between domestic political radicalism and interna-
tional militancy. Political identities and demands are changing in Bangladesh,
where there are no less than 125 Islamist militant organisations. Seven of
them are prominent: the already mentioned Ansarullah Bangla Team (ABT),
AQIS and Jamaatul Mujahideen Bangladesh (JMB); plus the Harkat-ul-Jihad-
al-Islami Bangladesh (HuJI-B), the Hizb-ut-Tahrir (HuT), the Jagrata Muslim
Janata Bangladesh (JMJB), and Sahadat-e Al-Hikma (SAH).86 Among them,
the most active groups are the ABT and JMB. They may be connected with
IS, as claimed by IS itself after the attacks and confirmed by information
obtained from the arrested. As far as AQIS is concerned, in September 2014,
Ayman Al-Zawahiri, in a video released by Al-Qaeda, announced the forma-
tion of a new body: «Al-Qaeda in the Indian Subcontinent».87
The emergence of violent radical Islam in Bangladesh may be explained
by the competition between Al-Qaeda/AQIS on one side and IS on the other.
Both organisations aspire to obtain the international leadership of Islamic
extremism and both seek maximum visibility for their actions. AQIS may try
to strengthen its presence in South Asia in order to claim a role in a post-
American Afghanistan and in a post-Zawahiri Al-Qaeda, remaining active in
a region – South Asia – where Al-Qaeda has its historical roots. On its part, IS
may be engaged in challenging Al-Qaeda’s influence in South Asia. In fact, at
the end of January 2015, IS announced its formal establishment in the Af-Pak
region.88
84. ‘Pak diplomat recalled from Dhaka over «extremist link»’, Asia Times, 23
December 2015.
85. ‘15 IS suspects held in Bangladesh in 1 year: Police’, Asia Times, 8 October
2015.
86. ‘Bangladesh: Freedom and death’.
87. ‘Al-Qaida leader announces formation of Indian branch’, The Guardian, 4
September 2014.
88. Arif Rafiq, ‘The New Al Qaeda Group in South Asia has Nothing to Do With
327
Marzia Casolari
According to Abul Barkat, Professor of Economics at Dhaka University

and an expert in the economics of fundamentalism, the Bangladeshi Islami-
st extremist organisations are «the militant front of the mainstream Islamist
Party», the Jamaat-e-Islami. JI has created «a state within a state» and an «eco-
nomy within an economy» in Bangladesh.89 The Jamaat has established its
presence in most sectors of Bangladesh civil society and economy: NGOs and
microcredit, madrasas, mass media, banks and finance, the pharmaceutical
industry and healthcare, real estate, trade and transport. Professor Barkat has
calculated that the Jamaat’s annual net profit amounts to about US$ 278 mil-
lion. The largest part of JI’s income, 27.5%, derives from bank, insurance and
finance. The second main source of income, 18.7%, is from the NGOs. About
10% of the total amount goes to the party’s political activities. The stron-
gest business lobbies in Bangladesh are connected with the BNP and JI, and
many persons accused of war crimes control this business. Mir Quasem Ali, a
Jamaat-e-Islami executive committee member sentenced to death for crimes
against humanity in the 1971 war, was a business tycoon and the director of
the Islamic Bank of Bangladesh Ltd. (IBBL), Jamaat’s principal source of
funding. The IBBL has been involved in illegal activities, some of which were
carried out on Jamaat’s behalf. In 2006, Mir Quasem Ali was prosecuted un-
der the Money Laundering Act for crimes committed through the IBBL. The
Islamic Bank of Bangladesh was founded in 1975 at the initiative of the Saudi
Ambassador in Dhaka, Fuad Abdullah Al Khatib, and has become one of the
largest banks in South Asia, with 60% of its shares held by Saudi Arabian
subjects. Recently, the IBBL extended its connections with the Islamic world,
forging links with the Razee Bank of Saudi Arabia. Besides IBBL, Jamaat con-
trols fourteen other banks, including the Islamic Bank Foundation (IBF), an
affiliate of IBBL. Mir Quasem is the chief of the IBF and of the Saudi Arabian
NGO Rabeta-al-alam-al-Islam. With other NGOs like the Kuwait Relief Fund
and the Al-Nahiyan Trust from Saudi Arabia, Rabeta runs several projects in
Bangladesh.90 Therefore, the government’s explanation for the insurgence of
Islamic radicalism in Bangladesh seems to be correct. IS is probably a label to
cover a network of local political movements and organisations coordinated
by JI, with the common dual objective of overthrowing the secular tradition
and values represented by the Awami League since the foundation of Ban-
gladesh and attacking the local religious minorities, namely Shia Muslims,
Hindus and Christians.
ISIS’, New Republic, 5 September 2014; ‘al-Qaeda’s India affiliate Made Official’, Inde-
pendent Strategy and Intelligence Study Group Website, 6 September 2014; ‘ISIS Formally
Establishes an Affiliate for the AF/PAK Region’, Independent Strategy and Intelligence
Study Group Website, 2 February 2015.
89. Amitava Mukherjee, ‘Economy of Islamic fundamentalism in Bangladesh’,
Dhaka Tribune, 9 February 2016.
90. Amitava Mukherjee, ‘The Economics of Islamic Fundamentalism in Bangla-
desh’, Geopolitical Monitor, 28 May 2015.
328
Bangladesh 2015
7. Will IS proliferate in Bangladesh?
The attention of international experts, analysts and governments is focu-

sed on Syria, Libya, Afghanistan and other areas in the Middle East and Africa,
considered the core of IS and international jihadism. Bangladesh is somehow
neglected as a potential laboratory and a manpower reserve for internatio-
nal terrorism. However, Bangladesh, the world’s third most populous Muslim
country, should not be underestimated as a potential recruiting ground for
radical Islamic organisations. The same applies to the huge Bangladeshi dia-
spora. Even if it is not possible, at present, to quantify the phenomenon, Ban-
gladeshis living in Great Britain and other European countries are a fertile re-
cruiting ground for radical Islamic organisations. For instance, in April 2015,
an entire family of eleven people based in Britain disappeared. It reportedly
joined the Islamic State in Syria. At the beginning of July, IS posted a mes-
sage asserting that the family was «safer than ever with the Islamic State».91
Adherence to radical Islam is a phenomenon which involves middle
class families living in metropolitan cities in Bangladesh or abroad. They
are isolated, tend to lose their family networks and, therefore, recognise
themselves in the religious community that symbolically replaces the exten-
ded family.92
The Bangladeshi diaspora, along with Islamic charities, is the main
source of IS financing. The reasons – which explain the growth of Islamic ra-
dicalism among Bangladeshi youths, both in their homeland and abroad—
are similar to those which apply to other Muslim youths living in Muslim
countries, in Europe and in the United States: unemployment, lack of
prospects, social and political exclusion, lack of government measures and
discrimination have created space for radical Islam. Within the mosques,
these youths feel acknowledged and involved. Those who join the armed
units are well paid. Jihad becomes a job.93 In 2014, the unemployment rate
among Bangladeshis in the UK over 16 years of age was 13.4%, which, as
far as unemployment is concerned, made them the third most affected com-
munity in the UK after Pakistanis (16.9%) and Africans and Caribbeans as
a whole (15.3%).94 IS is able to capitalise on the lack of social and economic
integration not only in Western societies, but also in Bangladesh.
91. ‘Islamic State wants you! Why some Bangladeshis heed the call’, Asia Times,
29 July 2015.
92. Ibid. A similar process has been described with reference to the spread of
Hindu political radicalism among the India urban middle class in late 1980s and
early 1990s. See Tapan Basu, Pradip Datta, Sumit Sarlar, Tanika Sarkar, Sambuddha
Sen, Khaki Shorts and Saffron Flags. A Critique of the Hindu Right, Orient Longman: New
Delhi, 1993.
93. ‘Islamic State wants you!’; ‘British jihadis in Bangladesh fanning flames of
extremism, says Dhaka’, The Guardian, 16 September 2015.
94. ‘Fact File – UK Labour Market Status by Ethnicity’ (April-June 2014); ‘Busi-
ness in the Community’ (http://www.bitc.org.uk/leadingchange/Factfile).
329
Marzia Casolari
Besides political violence, the country is still affected by social insecu-

rity and a lack of fundamental rights. Among the many other challenges
Bangladesh has been facing since its foundation, from poverty to climate
change and environmental problems or women rights, two are particularly
alarming: the violence against minors and the labour conditions.
8. Minors at risk
Between July and August 2015, three teenagers and a small girl were
brutally killed. Muhammad Samiul Alam Rajon, 13 years old, was killed in
Sylhet on 8 July. He was tied to a pole and tortured for about an hour. On
3 August, in Khulna, Rakib Hawladar, a 12 year old, was tortured to death
with unthinkable cruelty. On 4 August, Sumaiya Akter, a 3 year old girl, died
after being heavily beaten by her parents. The next day, Robiul Awal, 15
years old, was beaten to death for allegedly having tried to steal food. Rakib
Hawladar was murdered by the owners of the garage where he had worked
because he moved to another nearby garage. Witnesses reported that the
boy had previously been harassed and tortured on many other occasions.
Sumaiya Akter’s father, Emran Hossain, was a carpenter who had fallen
into debt. In order to earn some money, he and his wife duped people into
thinking they had supernatural powers and could exorcise them from evil
spirits. The couple used the girl to simulate a ritual, where she was beaten
to expel the evils from her body. These facts attracted people’s attention.
A friend of Rakib Hawladar witnessed part of the scene and reported
the facts to the local media. The boy was rescued, although too late, by
bystanders who, after his death, broke into the garage and brought the
owners to the attention of the police. Rajon’s murder was filmed and the
video went on Facebook. It outraged the public and stirred a public outcry
across the country. One of Rajon’s murderers, Kamrul Islam, managed
to flee to Saudi Arabia, but was caught by some Bangladeshi expatriates
and handed over to the police. The post «#JusticeforRajon» circulated
on Twitter, Facebook and the main social media. In November, four men
involved in Rajon’s murder and two in Rakib’s murder were sentenced to
death, to the cheering of the crowd gathered outside the court.95
Thanks to the public uproar, the police were compelled to act promptly.
On 12 August, people were arrested for Rajon’s murder, while Rakib and
Robiul’s killers and Sumaiya’s parents were arrested on the spot.96 Accor-
ding to the Bangladeshi Shishu Adhikar Forum (BSAF) – a Dhaka based
organisation promoting children’s rights – at least 154 children were killed
95. ‘6 sentenced to death for murder of minors in Bangladesh’, Asia Times, 8

November 2015.
96. ‘Series of gruesome child murders shocks Bangladesh’, Al Jazeera, 7 August
2015.
330
Bangladesh 2015
in Bangladesh between January and June 2015, 292 in 2014 and 180 in
2013.97 Children in Bangladesh are victims of rape, sexual and other kind
of abuse, and are often killed for insignificant reasons.98 These facts prove
not only that children’s rights in Bangladesh are still not respected and that
childhood is exposed to tremendous risks, but also that the combination
of poverty and ignorance can be deadly. All the murders described above
had economic motives: Rakib was a working child; Robiul was compelled to
steal food; Sumaiya died because of her parents’ economic problems; Rajon
came from a poor family.99 The poor in Bangladesh are powerless and are
often blackmailed by criminals. Children fall prey to sexual exploitation,
child labour and kidnapping for illegal trafficking.
On 14 March, the dead body of ten year old Abu Sayeed was di-
scovered in the house of a police officer in Sylhet. When arrested, the
man confessed that the boy had been abducted. The General Secretary
of the Sylhet Ulama League and an officer of the Rapid Action Battalion
were involved in the murder. The kidnappers had demanded a ransom of
500,000 Taka—less than 5,000 euros—from Sayeed’s family.100
Child suicide is on the increase in Bangladesh. In 2014, about 95
children took their own lives. According to the experts, children are depres-
sed because they are affected by poverty, child marriage and child labour,
and are forced to take responsibilities they cannot bear at an age when they
should only study and play. In metropolitan areas, there are not even play-
grounds, as land is being used to erect buildings and shopping centres.
Children play on the streets and are frequently victims of accidents.101
Children have always been exploited and abused in Bangladesh. The
people’s fierce reaction and the role of social media in denouncing the
crimes prove that awareness of children rights is increasing, but also that
much has still to be done.
9. The Rana Plaza issue
Other powerless subjects in Bangladesh are factory workers, especially

those employed by Western garment firms. According to a Human Rights
Watch (HRW) report published on the occasion of the second anniversary of
97. Ibid.
98. ‘Public uproar as spate of child murders continues in Bangladesh’, Asia
99. His father was a microbus driver and his mother a housewife. Rajon was
the elder of two brothers. At school he attended only the fourth class; afterwards,
in spite of his age, he had to sell vegetables to support his family. See Syed Tashfin
Chowdhury, ‘Bangladesh: A dangerous country for children’, Asia Times, 15 July 2015
100. ‘3 to hang for killing Sylhet schoolboy Sayeed’, Daily Sun, 30 November,
2015.
101. ‘Bangladesh: A dangerous country for children’.
331
Marzia Casolari
the Rana Plaza disaster of 24 April 2013,102 the workers continue to suffer
from poor working conditions, «physical assault, verbal abuse, forced over-
time, unsanitary conditions, denial of paid maternity leave, and failure to
pay wages».103
After the Rana Plaza collapse, the Western retailers set up two con-
sortia, the Accord on Fire and Building Safety – a group of 180 companies
based mainly in Europe – and the Alliance for Bangladesh, representing
26 North American firms. The two institutions have helped Bangladeshi
businessmen to improve the structures of their firms and to set up an in-
spection regime. The two organisations oversee more than 2,000 factories.
On its part, the Bangladeshi government has facilitated the registration of
new unions. These now number about 400, three times more than in 2012.
According to the HRW report, workers who try to form unions are often
intimidated, dismissed or physically assaulted.104
The Clean Clothes Campaign – an alliance of unions, NGOs and other
organisations in sixteen European countries – has been campaigning since
the April 2013 tragedy, demanding that companies and retailers compensa-
te the families of the victims and the injured. The Clean Clothes Campaign
has exposed many world famous companies whose clothes were produced
by the factories housed in the Rana Plaza building and has mobilised more
than a million consumers.105
In September 2013, representatives from the Bangladeshi government,
local and international garment companies, trade unions and NGOs came
together to form the Rana Plaza Coordination Committee. With the In-
ternational Labour Office (ILO) acting as a neutral chair, the Committee
aimed «to develop a comprehensive and independent process» to support
the victims, their families and the workers, according to international stan-
dards.106 In January 2014, the ILO set up the Rana Plaza Donors Trust Fund
to collect the financial resources to refund loss of income and the medical
expenses faced by the victims and their families. The ILO was the sole tru-
stee. The fund was financed by a combination of donors, including buyers,
companies and individuals who wished to make a voluntary donation.107 In
102. In the Rana Plaza disaster, 1,137 garment workers lost their lives and
about 2,500 were injured in the collapse of a factory in Dhaka. See Marzia Casolari,
‘Bangladesh in fiamme’, pp. 172-174.
103. ‘Bangladesh garment workers suffer poor conditions two years after re-
form vows’, The Guardian, 22 April 2015.
104. ‘Bangladesh: Garment Workers’ Union Rights Bleak’, Human Rights Watch,
22 April 2015; ‘Bangladesh: 2 Years after Rana Plaza, Workers Denied Rights’, Hu-
man Rights Watch, 22 April 2015.
105. ‘We Won!! Rana Plaza workers get compensation’, Clean Clothes Campaign,
8 June 2015.
106. See Rana Plaza Coordination Committee Website: http://www.ranapla-
za-arrangement.org.
107. Ibid.
332
Bangladesh 2015
November 2014, the Rana Plaza Coordination Committee announced that

about US$ 30 million was required to cover the refund costs.108 In April
2015, a week before the anniversary of the Rana Plaza disaster, 21 million
dollars had been collected and nine million were still missing. Benetton,
which sourced clothes from a Rana Plaza factory, eventually promised to
donate 1.1 million after denying any connection with the factories in the
collapsed building. Benetton’s donation came after protests and a peti-
tion signed by one million people asking the Italian corporation to donate
alongside other Western companies.109 The companies were supposed to
contribute on the basis of their share of production at Rana Plaza factories,
according to ILO compensation conventions. Benetton’s share was 1.8%.
The Italian company donated an extra 500,000 dollars to BRAC, the main
Bangladeshi NGO.110 Other Western companies that manufactured in Ban-
gladesh but not in the collapsed building, donated to the fund: the US$ 30
million target was eventually reached in June 2015.111
On 1 June 2015, the Bangladeshi authorities filed murder charges
against 41 people for the Rana Plaza collapse. Among the accused were
the owner of the building, Sohel Rana, his parents, the owners of seven
factories housed in the complex, and some government officials. Initially,
the defendants were charged with culpable homicide, but later the court,
due to the gravity of the accident and at the investigators’ request, decided
on a charge of murder. In the latter case, the defendants risked the death
penalty, whereas the maximum punishment for culpable homicide in Ban-
gladesh was only seven years in jail. The investigators changed their atti-
tude after discovering that the management of the factories, on the day of
the accident, forced the workers to enter the building despite the fact that it
had developed major cracks the previous day. The police defined the Rana
Plaza collapse a «mass killing». Other charges were related to the violation
of safety rules, as additional floors had been built up over the existing five
and had illegally housed additional factories. In December, the court issued
arrest warrants and ordered the seizure of the properties of 24 suspects who
had absconded. The defendants were asked to report to the police, in order
to be arrested, by 27 January 2016.112
108. ‘Bangladesh Rana Plaza factory fund finally meets targets’, The Guardian,
8 June 2015.
109. ‘Rana Plaza disaster: Benetton donates $1.1m to victims’ fund’, The Guard-
ian, 17 April 2015.
110. Benetton’s “Scheme of Compensation” for Rana Plaza victims, April 2015
(http://static.benettongroup.com/wp-content/uploads/2015/06/Benetton_Groups_Re-
port_16_April_2015.pdf).
111. ‘After two years the Rana Plaza fund finally reaches its $30m target’, The
Guardian, 10 June 2015.
112. ‘Rana Plaza collapse: dozens charged with murder’, The Guardian, 1 June
2015; ‘Rana Plaza: 24 murder suspects abscond before trial’, The Guardian, 21 De-
333
Marzia Casolari
10. A promising economy constrained by political turmoil
Despite a slight decline in economic growth in the fiscal year (FY)

2015113 and all the challenges it was facing (on which more below), Bangla-
desh, according to the World Bank and the IMF, advanced 14 steps from 58th
position in the world economy in 2013 to 44th position in 2015.114 Indeed,
Bangladesh’s economic growth did well in the first half of FY15.115 The
growth rate was 6.4% – a good result, but far below the 7% rate expected
by the government.116 According to the World Bank, the GDP growth rate
should rise to 7.5-8% to accelerate the poverty reduction and improve sha-
red prosperity.117 In the second part of 2015, the World Bank and the Asian
Development bank had to revise their growth forecasts respectively to 6.8%
and 6.7%, while inflation was expected to remain at about 6.2%.118
There is no survey-based evidence on poverty reduction in Bangla-
desh since 2010; however, it is assumed that the sustained GDP growth of
approximately 6% has been the result of agricultural growth of 3.3% and
remittance growth of 6.7%, which, taken together, made possible an annual
poverty decline of 1.74% between 2000 and 2010.119
During the year under review, the global growth recovery – in particu-
lar in the US and Europe – had positive repercussions on Bangladesh, while
the low international commodity prices favoured the investments and hel-
ped to contain inflation. The 12 month average inflation decelerated from
7.6% in February 2014 to 6.8% in February 2015.120
The fiscal deficit was stable. The total budget deficit in the first half of
FY15 amounted to 108.96 billion against 118.70 billion in the same period
of FY14.121
The Eighth Pay and Service Commission suggested a 100% salary in-
crease for civil servants. It was recommended that the lowest basic salaries
be raised from 4,100 Taka (US$ 52) to 8,200 Taka, and the highest ba-
sic salaries from 40,000 (US$ 510) Taka to 80,000 Taka. The government
cember 2015; ‘Bangladesh: 41 on trial for the Rana Plaza disaster’, European Affairs,
24 December 2015.
113. In Bangladesh, the fiscal year begins 1 July and ends 30 June. Accordingly,
FY 2015 coincides with the period 1July 2014 to 30 June 2015.
114. ‘Bangladesh economy moves up 14 places on World Bank, IMF scale in
two years’, bdnews24.com, 10 June 2015.
115. ‘Bangladesh Development Update’, The World Bank, April 2015, p. V.
116. ‘IMF Worried about Bangladesh’s Growth’, Forbes Asia, 11 March 2015.
117. ‘Bangladesh Development Update’, pp. 14-15.
118. ‘What 2016 holds for Bangladesh economy’, The Financial Express, 6 Jan-
uary 2016.
119. Ibid., p. 4.
120. ‘Bangladesh Development Update’, pp. V-VI and 5.
121. Ibid., p. 9.
334
Bangladesh 2015
planned to implement the Commission’s recommendations gradually, be-

ginning in FY16.122
Despite its promising results, Bangladesh’s economy was exposed to
several challenges. In 2015, the political turmoil took a heavy toll on the
economy and tested the resilience of Bangladesh’s growth. Disruptions to
domestic transportation due to the blockades in the first months of 2015
broke the supply chains. The apparel sector, which improved after the Rana
Plaza reforms, recorded losses due to order cancellations, shipment delays
and vandalism. Retailers cancelled trips and orders, shifting them to India,
China, Pakistan, Myanmar, Vietnam and Indonesia. The Bangladesh Shop
Owners’ Association, which represents 2.5 million retailers, reported that
sales dropped from 30 billion to 9 billion Taka a day.123
Disruptions also had a negative effect on revenue collection, which in
the first four months of FY15 was 3.2 lower than the corresponding period
of FY14.124 The pessimistic investment climate was confirmed at the end of
2015, due to the persistent risk of political instability. 125
Besides political unrest, other risks threatened Bangladesh’s deve-
lopment. The financial sector was weak due to rigid lending rates, nonper-
forming loans, financial scams and lack of accountability in bank manage-
ment.126 The land market was very inefficient because of long delays and
high costs in property registration, lack of ownership data, weak compute-
risation of land records, poor zoning laws and high transaction costs. The
availability of land for manufacturing enterprises was insufficient.127
On 18 February 2015, the government approved a proposal to esta-
blish 17 special economic zones (SEZs) to attract local and foreign investors.
However, the implementation of infrastructural projects was poor as a con-
sequence of resource constraints, unrealistic targets and procedural lapses
between the initiation and the completion of the projects. Corruption was
often behind the delays. Sometimes projects were approved far beyond the
planned inception date. Procedural delays and post-approvals held back
the projects’ start-up. Key projects started in 2014, mostly with foreign in-
vestments – such as the Dhaka-Chittagong four lane highway, the double
tracking Dhaka-Chittagong railway, the Dhaka metro rail, the Moghbazar
Flyover, the two Bibiyana gas power plants and others – were proceeding
disappointingly slowly.128
122. Ibid., p. 10.

123. Ibid., p. 3.
124. Ibid., p. 7.
125. ‘What 2016 holds’.
126. Ibid., pp. 6-7.
127. Ibid., p. 18.
128. Ibid., pp. 8-9. Regarding Bangladesh’s ambitious infrastructural projects
launched initiated in recent times, see also Marzia Casolari, ‘Bangladesh 2014’, pp.
230-237.
335
Marzia Casolari
Apart from domestic factors, Bangladesh is expected to face global

challenges in the short and medium term. The slowdown of the Europe-
an economy may compromise Bangladesh’s export competitiveness in the
main European markets. Moreover, exports to the European Union risk
being cancelled or reduced if Bangladesh does not succeed in improving
labour and safety standards in the garment sector.129
Female employment is the key factor in Bangladesh’s short and me-
dium term development. The country is facing a potential decline in GDP
growth from the present 6% to 5.7% in FY17, because of both the labour
force’s decline and reduced growth in productivity. The labour force has
begun to decline because of ageing, wider access to education and migra-
tion. There is a chance to increase the labour force growth by improving
female employment, however: women make up a little over half the national
population, but their contribution to the country’s economy is far below its
potential. In spite of significant progress in recent times, the labour market
remains divided along gender lines and the promotion of gender equality
in employment has stalled. It has been estimated that if female labour parti-
cipation rates were to rise by 2.1 million a year for ten years, pushing up the
total female participation to 75% of its full potential and reaching the level
of Thailand in 1990, the growth rate would rise to 7.3%. The leverage to
stimulate women’s participation is developing early childhood and tertiary
education, technical training, and reducing legal and social impediments to
pursuing a profession.130
11. India-Bangladesh ties grow up
«Hum paas paas hain, hum saat saat bhi hain» (literally, «we are close
close, we are also together together»). 131 The sentence sounds like a line
of a ghazal, but it is part of Indian Prime Minister Narendra Modi’s talk on
the occasion of his two-day visit to Bangladesh on 6 and 7 June 2015. «We
are close and united» was the ultimate meaning of Narendra Modi’s words.
India is adopting a leading role in the region, with the objective also
of containing China’s expansion into the Bay of Bengal. In this context,
Narendra Modi’s visit to Bangladesh was the first tangible act of rappro-
chement between the two countries after the tensions caused by the terri-
torial dispute dividing them and Modi’s electoral and post-electoral de-
clarations about Bangladeshi illegal immigrants in India. In fact, during
his electoral campaign in 2014, Modi declared that if the BJP came to po-
129. Ibid., p. 14.

130. Ibid., pp. 15 and 18.
131. ‘PM Modi in Dhaka: India, Bangladesh seal boundary agreement, pledge
zero tolerance to terrorism’, Hindustan Times, 7 June 2015.
336
Bangladesh 2015
wer, the «Bangladeshis would have to pack their bags and leave India».132
In June 2015, however, the Indian Prime Minister carefully avoided the
subject. On Modi’s initiative, the land boundary agreement –which had
been inked in 1974, namely 41 years before, but never ratified – became
effective on 6 June 2015. The agreement swapped 160 enclaves on both
sides of the border, whose residents, up to that moment, had been stateless
people. The enclaves were created in the eighteenth century by princely
rulers and were like islands where stateless people of either country used
to live. The Land Boundary Agreement (LBA) allowed about 51,000 pe-
ople to choose between Indian and Bangladeshi nationalities, also giving
them the right to decide to stay where they were, or to move to the other
country.133
In June 2015, Bangladesh and India signed 22 more agreements and
Memoranda of Understanding, including «blue economy» and maritime
cooperation agreements. India obtained the use of the Chittagong and
Mongla ports. Chittagong was developed through Chinese investment, like
several other major ports in Pakistan, Sri Lanka and Myanmar. Apparently
in a rather paradoxical development, India will be able to make use of an
infrastructure built by her main rival for influence in the Indian Ocean re-
gion. In fact, this development is not as paradoxical as it appears, but is the
result of a tripartite agreement between Bangladesh, China and India.134
Part of this agreement is the fact that India will build the infrastructure that
will facilitate the traffic of goods not only between the Indian state of West
Bengal and Bangladesh, but also between China and the Indian Ocean.135
Also, China continues to be the main supplier of military equipment to
Bangladesh and Dhaka’s «most dependable partner», according to official
sources.136 On the other hand, India is emerging as Bangladesh’s potential
key partner in the energy sector. In fact, India has agreed to raise the power
supply to Bangladesh from 500 to 1000 MW and has supported a sale to
the Bangladesh Power Development Board of 3000 MW at a cost of US$ 3
billion. In addition, two coal-fired plants with a capacity of 1600 MW are ex-
pected to be set up by the Indian corporation Adani Power, at a cost of US$
1.5 billion. Last but not least, Narendra Modi announced a line of credit of
132. Marzia Casolari, ‘Bangladesh: Old Patterns’, pp. 231-232; ‘Modi visit: All
you need to know about India-Bangladesh pacts’, Hindustan Times, 7 June 2015.
133. The India-Bangladesh enclaves date back to 1713 as the result of an un-
clear treaty between the Koch Bihar Kingdom and the Mughal Empire. There are
102 Indian enclaves and 21 counter-enclaves in Bangladeshi territory and 71 Ban-
gladeshi enclaves and 3 counter-enclaves in Indian territory.
134. I want to thank Nicola Mocci for bringing this to my attention.
135. ‘Why is India serious about Chittagong Port and Bangladesh?’ The Indian
Iris, 6 June 2015.
136. Harsh V. Pant, ‘How PM Modi’s visit to Bangladesh will help reduce trust
deficit in bilateral relations’, DNA, 5 June 2015.
337
Marzia Casolari
US$ 2 billion to Bangladesh, while Sheikh Hasina pledged zero tolerance

of terrorism.137
137. ‘Modi announces $2-bn credit to Bangladesh’, The Hindu, 6 June 2015;
‘Modi visit’; ‘PM Modi in Dhaka’; ‘Modi bridges gaps between India, Bangladesh’,
Asia Times, 12 June 2015; ‘Modi-fying India-Bangladesh Ties’, IPCS, 15 June 2015;
‘Modi in Bangladesh: Developments and Disappointments’, IPCS, 23 June 2015.
338
india 2015: the uncertain record oF the Modi governMent*
Michelguglielmo Torri and Diego Maiorano
University of Turin University of Nottingham

mg.torri@gmail.com Diego.Maiorano@nottingham.ac.uk
Narendra Modi’s 2014 election generated enormous expectations in the economic sphe-
re. However, in 2015, on the one hand, Modi was unwilling or unable to push through
any «big bang» reforms; on the other hand, jobs generation – one of Modi’s key electo-
ral promises – proceeded at an excruciatingly slow pace. At the macroeconomic level,
the Indian GDP grew by 7.3% during 2014/15, making India the fastest growing
among the major economies. However, these data were the result of a new methodo-
logy, and most economists, including some politically close to the Modi government,
were uncertain about its reliability. Moreover, when applied to the previous years, the
new methodology unequivocally showed that the positive turn-around in the economy
had happened before Modi’s government came to power. The Indian economy was also
severely affected by a deepening rural crisis. Some of its causes were beyond the reach
of Modi’s government, but it is a fact that its response was disappointingly inadequate.
Domestic politics was a constant source of difficulty for Modi. First, state elections
in Delhi and Bihar dispelled the myth of the invincibility of the Modi – and Amit
Shah – led BJP, which was soundly defeated by local outfits. Second, the government
struggled to pass key legislation in Parliament, also thanks to the unexpectedly suc-
cessful opposition of the Congress party. Finally, the most worrying development on
the domestic front was the rise of intolerance against non Hindus, who were victims of
Fascist-like, sometimes deadly, aggressions by Hindu outfits. This happened while the
Prime Minister appeared basically unconcerned about the climate of growing violence
and some members of his government went so far to openly justify this state of affairs.
The aim of Modi’s foreign policy was projecting India as a major power on the world
stage and getting all the possible foreign help in promoting India’s economic deve-
lopment. To this end, India’s foreign policy was articulated along two main axis: the
India-US connection and the India-China connection. In turn, the latter had two faces:
engaging China and containing China. At the end of the day, the India-US connection
was high on hype but low on content, among other reasons because the US business
community, after its initial enthusiasm for Modi, had come to perceive him as well
intentioned but unable to further liberalise the Indian economy. India’s economic en-
gagement with China brought about the signing of several MoUs and China’s promise
to invest in India. However the concrete fall-out of all this was limited. More concrete
* The present chapter is the outcome of a joint research effort, every single
part of it having been jointly discussed by the two authors before being written and
revised by both afterwards. However, the final draft of parts 1, 2.6, 2.7, 3.2.1, 4 has
been written by Michelguglielmo Torri, whereas the final draft of parts 2 (with the
exception of sub-parts 2.6 and 2.7) and 3 (with the exception of sub-part 3.2.1) by
Diego Maiorano.

MichelguglielMo Torri & Diego Maiorano
appeared the containment aspect of Modi’s China policy, which, at a more general level
was expression of India’s strategic surge, aimed at reclaiming the position of great power.
1. Introduction
In 2015, India’s political, economic and even social landscape was

dominated by the presence of her prime minister, Narendra Modi. In the
making of political and economic strategies, Modi’s role was a proactive
one, the prime minister playing the role of the undisputed star on stage.
In contrast, in the case of social problems, Modi appeared conspicuous for
his virtually total absence from stage. Nevertheless his absence was – for all
intents and purposes – as politically significant as his urge to play the domi-
nant role when dealing with politics and the economy. At first sight, the con-
trast between Modi’s unbound activism in the political and economic fields
and his sloth and timidity when dealing with social problems may appear
paradoxical. In reality, this apparent strangeness is the natural manifesta-
tion of Narendra Modi’s Janus-faced political personality: on the one hand,
there is Narendra Modi the statesman, the Indian super-CEO, the man who
purportedly intends to modernize India and make her a world power; on
the other hand there is Narendra Modi the former Rashtriya Swayamsevak
Sangh (RSS) pracharak, the political leader who turned a blind eye to the
2002 pogrom against the Gujarat Muslims, the Gujarat Chief Minister who
presided over the marginalization and ghettoization of the local Muslim
community.
During the extraordinarily successful 2014 general election campaign,
the latter aspect of Modi’s personality was successfully disguised under the
elegantly tailored suit of India’s super-CEO to be. Nevertheless, if the su-
per-CEO aspect of Modi’s personality is undoubtedly a real one, the same is
true, in the opinion of the authors of this chapter, with respect to the other
aspect of Modi’s personality – that of the Hindu communal leader. Accord-
ingly, in 2015, Modi’s activism, or lack of it, can be explained by his dual
political and ideological personality, as a pro-business and a Hindu leader.
During 2015, both the Indian and the international press, while ad-
vancing some infrequent and timid criticism of Modi’s role as a Hindu
leader, by and large continued to give a very positive assessment of his role
as India’s super-CEO. However, as will be shown in the remainder of this
article, even as India’s super-CEO, Modi’s performance has been much less
successful than may appear at first sight.
The remainder of this article will proceed as follows: first, the eco-
nomic policy implemented by the Modi’s government and its (mixed) re-
sults will be analysed; then the analysis will dwell on the domestic political
developments; finally Modi’s over-dynamic and over-personalized foreign
policy will be assessed.
340
IndIa 2015
2. Modi’s economic policy
Modi’s election generated enormous expectations in the economic

sphere.1 On the one hand, the Prime Minister was expected to put India’s
economy back on a path of high growth; on the other hand, he promised to
create million of new jobs for what is one of the fastest growing labour force
in the world.2 Modi’s main strategy for achieving these objectives was based
on a series of economic reforms that would stimulate investments (both do-
mestic and foreign), and on initiatives aimed at bettering the quality of In-
dia’s labour force. In this section, we will first look at Modi’s government’s
key economic reforms and the first budget it presented in February 2015; we
will then analyse how and to what extent some of the key economic electoral
promises – the implementation of the Goods and Services Tax, the creation
of jobs, and the support of farmers’ incomes – were fulfilled; finally we shall
examine the data related to the growth of the economy in the year under
review.
2.1. A government signalling its intention to push ahead

with its reformist economic agenda...
The year 2015 started with the appointment of Arvind Panagariya, a
renowned free-market economist and a professor of economics at Columbia
University (New York), as the first vice-chairman, namely de facto head, of
the newly established Niti Aayog, the body which replaced the Planning
Commission in 2014.3 Panagariya’s appointment was seen by many as a
concrete sign that Modi intended to push for a programme of rapid eco-
nomic reforms.
Indeed, between the end of December 2014 and the first week of Janu-
ary 2015, the government promulgated several ordinances on economic
matters. This was a message to both investors and the opposition that the
government was ready to bypass the Parliament in order to push ahead with
its reform programme. In fact, during the second part of 2014, the govern-
ment’s attempt to pass its economic reform legislation in the Rajya Sabha
had been stalled by its lack of a majority in the Upper House.
1. Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihilation of

the Congress Party and the beginning of the Modi era’, Asia Maior 2014, pp. 241–322.
2. Diego Maiorano, ‘Early Trends and Prospects for Modi’s Prime Ministership’,
The International Spectator, Vol. 50, No. 2, 2015; Michelguglielmo Torri, ‘The Modi
Wave: Behind the Results of the 2014 General Elections in India’, The International
Spectator, Vol. 50, No. 2, 2015.
3. ‘Arvind Panagariya: A free-market economist and supporter of Gujarat mod-
el’, The Economic Times, 5 January 2015; ‘Narendra Modi appoints US-based econo-
mist Arvind Panagariya as NITI Aayog’s vice chairman’, The Indian Express, 6 January
2015. As in the case of the Planning Commission, the Niti Aayog’s chairman is the
Prime Minister.
341
The most significant ordinances were – listed in chronological order –

the Coal Mines (Special provisions) second ordinance; the Insurance Laws
(Amendment) ordinance; the Land Acquisition ordinance; 4 and the Mines
and Minerals ordinance.
The Coal Mines (Special provisions) second ordinance,5 promulgated
on 26 December 2014, aimed at clearing the logjam created by an order
of the Supreme Court, in September 2014, which had cancelled hundreds
of coal-mining licences that had been allocated illegally.6 The ordinance
introduced a more transparent procedure for the allocation of coal blocks,
which aimed at more strictly regulating what had become a major source of
corruption.7 The ordinance was also a first step towards liberalising the coal
sector.8 By allocating mines to the state governments for commercial min-
ing, the ordinance put an end to the monopoly of the centre in the sector.
The Insurance Laws (Amendment) ordinance, promulgated on 26 De-
cember 2014, hiked the Foreign Direct Investment (FDI) limit in the insur-
ance sector from 26 to 49%.9
The Land Ordinance emended the Land Acquisition Act of 2013 – the
last important piece of legislation enacted by the UPA2 government – by
listing five new categories of projects for which land expropriation would be
facilitated. In fact, for these projects – related to infrastructure, defence, and
industrial corridors – prior consent from affected families and social impact
assessment (SIA) would not be required.10
4. The complete name of this ordinance is The Right to Fair Compensation and
Transparency in land Acquisition, Rehabilitation and Resettlement (Amendment) Or-
dinance.
5. The first Coal Mines ordinance had been promulgated on 21 October 2014.
As ordinances are valid only for the periods when the Parliament is not in session and
must be replaced by an Act in the next Parliamentary session, the Minister of Coal,
Piyush Goyal, introduced a Coal Mines (Special Provisions) Bill in the Lok Sabha on
10 December 2014. However, the bill could not be enacted. Hence the government’s
decision to promulgate the second Coal Mines ordinance. ‘All You Need to Know
About Coal Mines Bill’, The New Indian Express, 4 March 2015.
6. ‘India Supreme Court Cancels Hundreds of Coal Licenses’, The Wall Street
Journal, 24 September 2014.
7. See ‘The Coal and Mines (Special Provisions) Second Ordinance, 2014’, The
Gazette of India, 26 December 2014, for the full text.
8. ‘India takes first step to end state coal monopoly’, Mining.com, 12 December
2014.
9. ‘The Insurance Laws (Amendment) Ordinance, 2014’, The Gazette of India, 26
December 2014, for the full text. Other provisions later in the year raised FDI caps
on the defence and railways sectors. See Milan Vaishnav, ‘Modi’s Reform Agenda:
Change you can Believe in?’ Carnegie Endowment for International Peace, 24 November
2015.
10. ‘Union Cabinet approves amendment to Land Acquisition Act’, The Indian
Express, 30 December 2014. See ‘The Right to Fair Compensation and Transparency
in land Acquisition, Rehabilitation and Resettlement (amendment) Ordinance’, The
Gazette of India, 31 December 2014, for the full text.
342
IndIa 2015
The Mines and Minerals ordinance, promulgated on 12 January 2015,

emended the 1957 Mines and Minerals Act. It aimed at removing discretion
when granting mineral concessions, by making it compulsory to allot them
through public auctions.11
All the above ordinances were turned into legislation by the Parlia-
ment during the Budget session, with one conspicuous exception. In fact,
the Land Acquisition ordinance became the object of a major political clash
between the majority and the opposition. Finally – as detailed in the section
on domestic policies – the government gave up the attempt to turn it into an
act in August 2015, when it decided to let the ordinance lapse and accepted
the requests of numerous state governments that were seeking to pass their
own land laws.12
2.2. ... but failing to convincingly do so in the budget

In spite of the promise of a rapid implementation of key economic re-
forms, the 2015-16 budget – as usual presented on the last day of February
– did not contain any «big bang» reforms. 13 Rather, the government chose
to follow in the footsteps of its predecessor, continuing with a «gradualist»
approach.14
One of Modi’s top priorities in the economic sphere was to increase
capital expenditure for infrastructures. In order to do this, however, he had
to find the resources without giving the impression to foreign and domestic
investors that he was reversing the traditionally rather conservative fiscal
policy of the Indian government.
Arun Jaitley, the Finance Minister, found the resources mainly from
thee sources. First, the government chose to relax its short-term fiscal deficit
reduction targets, without changing the medium-term ones. This provided
some (short-term) fiscal space. Second, expenditure on subsidies was cut
significantly, but this reduction was entirely due to the huge fall in global
crude and commodity prices. Third, the government planned to raise Rs.
69,500 crore [Rs. 695 billion] through disinvestment (i.e. the privatisation
of state-owned enterprises). The latter source of resources, however, remai-
ned largely on paper, since, as of October 2015, the government had been
11. Press Information Bureau, Government of India, Ministry of Mines, Gov-

ernment Promulgates the Mines and Minerals (Development and Regulation) (Amendment)
Ordinance, 2015 (http://pib.nic.in/newsite/PrintRelease.aspx?relid=114589); ‘Indus-
try welcomes passage of Mines Bill in RS’, The Hindu, 20 March 2015.
12. ‘10 states seek to have their own land laws’, Business Standard, 16 July 2015.
13. Unless otherwise specified, factual information on the Budget is taken from
two sources: Budget 2012–2013. Speech of Arun Jaitley, Minister of Finance, 28 February
2015; Ministry of Finance, Expenditure Budget, New Delhi, 2015. Both documents are
available at: http://indiabudget.nic.in
14. Montek Singh Ahluwalia, ‘Economic reforms in India since 1991: has grad-
ualism worked?’, The Journal of Economic Perspectives, Vol. 16, No. 3, 2002, pp. 67-88.
343
able to raise just Rs. 12,600 crore [Rs. 126 billion].15 Moreover, out of this
sum, Rs. 9,000 crore [Rs. 90 billion] came from the selling of 90% of India
Oil Corporation to another state-owned enterprise, Life Insurance Corpo-
ration of India.16 In addition, in mid November 2015, the government gave
its nod to the sale of 10% of Coal India Ltd, which was supposed to fetch
the government about Rs. 21,000 crore [Rs. 210 billion].17 In any case, the
inability of Modi’s government, despite its huge majority in Parliament, to
significantly disinvest its shares of public enterprises shows how politically
sensitive this issue remains.
Overall, Jaitley was not able to mobilise relevant resources for infra-
structure investments. The budget for capital expenditure was raised to
1.7% of the GDP (up from 1.5% in 2014/15), which was about the same as in
2012-13 and 2013-14 when «nobody made a song and a dance about it».18
Jaitley’s fiscal space was also constrained by the fact that the go-
vernment, in order to fulfil its promise of fostering a more business-friendly
environment, decided to cut the corporate tax rate by as much as 5 percen-
tage points and not to implement the much hated General Anti-Avoidance
Rule (GAAR)19 for another two years.
Another indication of how constrained Jaitley’s fiscal space was can be
seen in the very limited increase in military expenses. These were brought
to Rs. 2,46,727 crore, a rise of 6.9% compared to the sum allocated in Jait-
ley’s first budget.20
Furthermore, the government, wishing to please the urban middle
classes, which had so much supported Modi in the 2014 general elections,21
introduced a number of incentives for retirement investments, health care
insurance, and financial savings and abolished the wealth tax. On the other
hand, the government increased by 2% the surcharge on the super rich and
marginally raised indirect taxation. Finally, what is usually called ‘revenue
15. ‘Listed PSUs should interact regularly with investors: DoD’, Business Stand-
ard, 26 October 2015.
16. ‘Reforms in the Freezer’, Livemint, 30 August 2015.
17. ‘Cabinet clears plethora of proposals to put economy on the fast track’, The
Hindu Business Line, 18 November 2015.
18. ‘The budget, shorn of the hoopla’, Livemint, 2 March 2015.
19. The General Anti-Avoidance Rule was introduced during the second UPA
government by then Finance Minister Pranab Mukherjee in his Budget, presented on
16 March 2012, for the year starting on 1 April. GAAR had the objective to «counter
aggressive tax avoidance schemes». Its major problem was that it could be applied
retroactively. See ‘5 facts about the general anti-avoidance rule (GAAR)’, NTDV, 7
May 2012; ‘Govt delays GAAR after investor backlash’, Reuters, 7 May 2012.
20. Budget 2012–2013. Speech of Arun Jaitley, § 86, p. 18. In the 2014-15 budget,
the allocation for defence had been raised by 12% compared to the previous financial
year. See Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihilation of
the Congress Party and the beginning of the Modi era’, p. 292.
21. E. Sridharan, ‘Class Voting in the 2014 Lok Sabha Elections’, Economic and
Political Weekly, Vol. XLIX, No. 39, pp. 72-76.
344
IndIa 2015
foregone’ (made up of tax concessions and the relaxation of custom duties

and excise) grew slightly to Rs. 5.89 lakh crore, the largest share being con-
stituted by exemptions for the diamond and gold industries. Overall, the
tax-to-GDP ratio (one of the lowest in the world)22 remained unchanged
at 10.3%.
The big story of the 2015/16 Budget, however, was the rather radical
restructuring of fiscal centre-state relations. Shortly before the presenta-
tion of the budget, the government accepted the recommendations of the
14th Finance Commission, which had proposed raising the states’ share of
central government revenues from 32 to 42%, which increased the receipts
of the states by Rs. 1.41 lakh crore [Rs. 1410 billion]. However, this was
matched by a reduction of Rs. 1.34 lakh crore [Rs. 1340 billion] of central
government funding to state plans.23
This restructuring of fiscal centre-state relations has several implica-
tions. Firstly, what is significant is not so much the (limited) increase in the
resources transferred to the state governments, but the fact that the states
were left free to spend these additional resources as they preferred. However,
it should be noted that in some states (Telangana, Uttarakhand, Karnataka
and Maharashtra) the availability of resources actually decreased between 3
and 20% when compared with the previous year’s revised estimates.24
The bulk of the reduction of the centre’s assistance to the states’ plans
came from the reduction in the funding of Centrally Sponsored Schemes
(CSS).25 This decision was bound to have huge implications, in particular
for the social sector, since most CSSs are welfare programmes.
The 2015-16 Budget divided the existing CSSs in three categories.
First, some schemes were discontinued, among which were the Backward
Regions Grant Funds, a scheme for strengthening the panchayats, a sche-
me for the modernisation of police forces, and the National e-Governance
Plan. Second, 31 schemes, including the Mahatma Gandhi National Ru-
ral Employment Guarantee Act (MGNREGA), the Sarva Shiksha Abhiyaan,
and the Mid Day Meal Scheme continued to be fully funded by the cen-
tral government. Third, for 24 schemes – among which the Swachh Bharat
Abhiyaan, the National Health Mission, the Rashtriya Madhyamik Shiksha
Abhiyaan, the Integrated Child Development Scheme (ICDS), the National
AIDS and STD Control Programme, and the Rural Housing scheme – the
22. Jean Dreze & Amartya Sen, An Uncertain Glory – India and its Contradictions,
London: Allen Lane.
23. Abhijit Sen, ‘Why I am a Dissenter’, The Indian Express, 3 March 2015.
24. Avani Kapur, Vikram Srinivas & Priyanka Choudhury, State of Social Sector
Expenditure in 2015/16, New Delhi: Accountability Initiative, Centre for Policy Re-
search.
25. These are programmes funded mostly by the central government, but im-
plemented by the states, that have to respect very specific spending requirements set
by the central government.
345
government severely reduced its budgetary commitments, leaving to the

states the decisions regarding whether to keep the original budgetary allo-
cations by using the newly allocated additional resources.26
The cut in funding for these social sector programmes was particularly
alarming for the schemes belonging to the third category. For example,
the budget for the ICDS – India’s only programme to tackle child malnu-
trition27 – was cut by as much as 44%. The Minister for Women and Child
Development, Maneka Gandhi, in a rare expression of dissent from her
own government’s policy, said that with the reduced budgetary allocation
there was barely enough money to pay for the wages of the millions of he-
alth workers in charge of running the programme.28 Another example was
the health sector, which saw its budget reduced not only as a proportion
of GDP and in real terms, but even in monetary terms.29 This is likely to
have disastrous consequences in the future, as recently argued by a group
of scholars in the prestigious medical journal The Lancet.30 In fact, India
already had one of the lowest health budgets (as a proportion of GDP) in
the entire world.31
Obviously, the question is to what extent the states will match the cen-
tral government’s cuts with their own resources. This will depend not only
on state-specific political considerations, but also on the technical capacity
of the states to manage an unexpected «29 billion dollar bonanza».32 It is
rather ironic that the central government, in an attempt to devolve more
powers to the states, caught them completely unprepared to deal with the
changed fiscal situation. Not only does it appear that the states were caught
unprepared to cope with the impending changes in the funding for the
social sector programmes, but the timing of the announcement of these
changes (in the budget presentation speech of the Finance Minister on 28
February 2014) was particularly ill-timed. In fact, many state governments
had already passed their 2015-16 budgets, whereas the central ministries
were expected to approve the CSSs annual plan and budget for states within
26. ‘Budget 2015/16 in eight charts’, The Hindu, 1 March 2015.

27. India has one of the highest rates of undernourished children in the whole
world, much higher than most Sub-Saharan African countries. The most recent avail-
able data (collected in 2014) show that as many as 38.7 % of the children under five
are stunted. Ministry for Women and Child Development, Rapid Survey on Children,
New Delhi.
28. ‘India’s budget cuts hurt fight against malnutrition: Gandhi’, Reuters, 19
October 2015.
29. Jean Drèze, ‘Nehruvian budget in the corporate age’, The Hindu, 5 March
2015.
30. Vikram Patel et al., ‘Assuring Health Coverage for All in India’, The Lancet,
Vol. 386, No. 10011, 2015, pp. 2422-35.
31. Ankita Rao, ‘Welcome to Modicare’, Foreign Policy, 4 March 2015.
32. Yamini Aiyar, Avani Kapur & Vikram Srinivas, ‘How Will—Unprepared—
States Handle A $29-Billion Budget Bonanza?’, Indiaspend, 2 April 2015.
346
IndIa 2015
a few weeks. It was a situation bound to increase the states’ difficulties in

managing and correctly spending the central funds allocated for the CSSs.
It is also worth stressing that, even in normal times, the states had tackled
with difficulty the task of managing CSSs central funding, often leaving a
conspicuous part of it unspent.33
One final implication of the changed fiscal relations between the cen-
tre and the states could be a growing gap between the richest (and admi-
nistratively more capable) and the poorest state. However, it is certainly a
good idea, on principle, to leave the state governments with more leeway
in spending centre-allocated resources, as each state has a better understan-
ding of its own local conditions and needs. In fact, a state with notoriously
low administrative capacity, Bihar, has been able, in recent years, to dra-
matically improve its implementation capacity of state-designed schemes.34
2.3. The unsuccessful attempt to push through the Goods and Service Tax bill
Another important piece of legislation that encountered substantial
difficulties was the Goods and Service Tax (GST) bill. The reform of indirect
taxation is a long-time demand of India’s business groups. In fact, each state
has its own regulations, which makes it difficult to move goods and services
across state borders, inflates costs and causes severe delays. The 2015 GST
bill aimed at replacing this chaotic structure with a national goods and ser-
vices tax, getting rid, in the process, of at least 14 federal and state levies,
which often resulted in double taxation, pushed up the average burden for
all goods at about 30% of the cost, going, in a few cases, as high as 50%. Mo-
reover, the necessity to collect these taxes caused considerable delays in the
movement of goods, as the trucks transporting them had to spend nearly a
quarter of their road time going through border checks and being subjected
to other inspections.35
In spite of the evident drawbacks of the prevailing situation, the bill
faced strong opposition both by the states and the Congress party. Indeed,
the latter went out of its way to oppose the bill, in spite of the fact that it
had supported the imposition of GST legislation in the past. But the most
significant source of opposition came from the state governments, which fe-
ared loosing part of their revenues. This was a main stumbling block, as the
support of the states was crucial not only for passing the bill in the Upper
House, but also because, in order to become operational, the GST law had
to be ratified by at least half of them.
33. Ibid.
34. Avani Kapur, ‘Lessons from the Bihar model of development’, Business
Standard, 12 November 2015. Unfortunately, as noted by Kapur, Bihar’s ability to
implement centre-designated schemes remains low.
35. ‘Business groups turn sceptical on Modi’s landmark reform’, Reuters, 2 July
2015.
347
It was precisely to assuage the opposition from the states that the go-
vernment agreed to a 1% additional new toll by states for goods crossing
the internal borders, even in cases when the same company was shipping
its own products from one of its plants to another. Moreover, the GTS bill
did not extend to real estate, leaving companies still subjected to state taxes
on plants and properties, possibly including machinery. Again this was not
an oversight, but the result of the fact that these kinds of taxes were one of
the major financial sources for the states.36 This being the situation, it does
not come as a surprise that, once the GST bill was introduced in Parliament,
India’s business community reacted with considerable disappointment. In
fact, it pointed out that the bill could result in an increase in taxation ra-
ther than in its diminution, creating a situation in which, according to an
anonymous senior executive at a major steelmaker, «it would be easier for
businessmen to import rather than manufacture goods in the country».37
The business community opposition, however, was not a compact one.
In fact, a report by the Confederation of Indian Industry (CII) argued that,
if implemented well, the proposed legislation would significantly lower lo-
gistic costs.38 In any case, the government failed to implement the bill on 1
April 2016, as promised.39
Overall, at the end of the period under review it appeared that the
impression (and hope) that Modi would push through a set of epochal eco-
nomic reforms was inaccurate. Both institutional constraints (in particular
the BJP’s lack of control of the Upper House) and political considerations
(in particular the BJP’s fear of being depicted as anti-farmer and anti-poor)
resulted in the continuation of India’s long-established gradualist approach
to economic reform. Modi himself has indeed acknowledged the path of
reforms is a «marathon» rather than a «sprint».40
2.4. Attracting additional foreign direct investments (FDI)

A main preoccupation moulding the economic policies of the Modi
government has been attracting FDI, particularly through its «Make in In-
dia» campaign. Although what the Make in India campaign entails in terms
of concrete policy has never been totally clear,41 it appears that, on the one
36. Ibid.
37. Ibid.
38. ‘GST will result in logistics cost cut: Report’, The Economic Times, 30 October
2015. However, the CII «suggested removing the provision for interstate levy». See
‘Business groups turn sceptical on Modi’s landmark reform’.
39. ‘Govt to meet with states on Monday over GST logjam’, The Indian Express,
22 October 2015.
40. ‘Path of reforms is not a «print» but a «marathon»: Modi’, Business Standard,
6 November 2015.
41. ‘One year on, Modi government has proved its critics wrong’, Scroll.in, 16 May
2015. Please see the next section for further details on the Make in India campaign.
348
IndIa 2015
hand, the government instructed its officials to expedite business activity-

related processes and procedures, while, on the other hand, a few small
but important administrative changes made it easier to start and conduct
business. This strategy was not totally devoid of results; in fact in the latest
World Bank’s Doing Business Report, India moved up twelve positions in the
«ease of doing business» ranking.42 This was mainly due to easier and faster
procedures for obtaining an electricity connection and starting a new busi-
ness.43 Although there was still a long way to go – India was ranked 130th
out of 189 countries – the direction of change was certainly positive and
showed that Modi’s battle against red tape was starting to pay off. It is also
significant that the conclusions of the World Bank’s report, based on data
collected in Delhi and Mumbai, were strengthened by the government’s
own data. These suggested that states such as Gujarat, Rajasthan, Chhat-
tisgarh, Madhya Pradesh, and Odisha had recently made important steps
forward in reducing unnecessary business regulations.44 It is thus possible
that the all-India picture might be better than the World Bank report sug-
gested. It is also worth stressing that the 2015 Doing Business report is based
on data collected up to June 2015; accordingly, it does not take into account
a number of changes introduced after that date. The post-June 2015 data,
which will be shown in the 2016 report, are likely to positively impact on
India’s ranking.
Once all this is said, it is necessary to stress that data on investment flows
do not offer a clear picture of the impact of these measurers. On the one
hand, FDI have indeed been increasing. In September, The Financial Times re-
ported that India was then ahead of both China and the United States as the
most favoured destination for FDI.45 On the other hand, Gross Fixed Capital
Formation (GFCF) data do not indicate any dramatic surge of investment le-
vels. Similarly, data from the Department of Industrial Policy and Promotion
do not show any significant revival in investment trends.46 On a more positive
note, data show that the lion’s share of new investments are in the manu-
facturing sector, whose growth was one of the key objectives of the «Make in
India» campaign.47 When all the above is taken into account, it is necessary to
42. The World Bank has introduced a new method for calculating the ranking.
If the new methodology is applied to last year’s data, then India moved up by four
positions only. ‘A pat on the back, but buck up and carry on: Kaushik Basu’, The Hin-
du, 28 October 2015.
43. Doing Business 2016: Measuring Regulatory Quality and Efficiency, Wash-
ington DC: The World Bank 2015. http://www.doingbusiness.org/data/exploreecono-
mies/india
44. ‘The long battle against red tape’, Livemint, 28 October 2015.
45. ‘India grabs investment league pole position’, The Financial Times, 29 Sep-
tember 2015.
46. ‘Broad-based revival in investment cycle remains elusive’, Business Standard,
19 November 2015.
47. ‘No resolution to stalled projects’, Livemint, 1 October 2015.
349
point out that, after a few quarters of significant progress in the unclogging
of stalled projects, there has been an inversion of the trend. At the end of the
quarter ending in September 2015, the stock of stalled projects amounted to
Rs. 9.9 trillion, up from Rs. 8.8 trillion of the previous quarter.48
2.5. Creating jobs at an excruciatingly slow pace

Apart from the pledge to reboot the economy through a sustained pro-
gramme of economic reforms, the other key promise of Modi’s 2014 electo-
ral campaign was that of creating jobs. During his prime ministership, Modi
has attempted to fulfil this electoral pledge by pursuing two strategies: the
already quoted «Make in India» Campaign and an ambitious programme
for skills development.
The Make in India campaign was announced with great hype shortly
after the 2014 elections. 49 The objective of the campaign was to increase the
share of the (supposedly labour-intensive) manufacturing sector from 15 to
25% of the GDP by incentivising both foreign and domestic investments. Ho-
wever, as has already been pointed out, the data related to FDI and domestic
investment are not such as to paint a picture of any clear-cut success. Moreo-
ver, at the time of writing (December 2015) the available data showed that du-
ring the first year of Modi’s government, job creation had been rather slow.50
This is in line with recent trends. According to a recent working paper publi-
shed by the Indian Council for Research on International Economic Relations,
employment generation in the manufacturing sector has been growing at an
excruciatingly slow pace: between 1990/2000 and 2011/12 only 1.4 million
jobs were created per year, as against an estimated increase of the workforce of
7-8 million young people per year.51 Furthermore, according to the latest avai-
lable Annual Survey of Industries, India’s manufacturing sector is highly (and
increasingly) capital intensive, thus reducing future prospects for generating
jobs.52 Summing up, given the capital-intensive nature of India’s economic
growth and the absence of any meaningful corrective to this, it seems very
unlikely that Modi will be able to meet his voters’ expectations in this regard.
As noted above, Modi’s second strategy to boost job creation was the
introduction of an ambitious new skill-development programme, aiming to
48. Pranjul Bhandari & Srinivas Prithviraj, India Economic Comment, HSBC
Global Research, October 2015.
49. See also Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the anni-
hilation of the Congress Party and the beginning of the Modi era’, pp. 297-298; and
Diego Maiorano, ‘Early Trends and Prospects for Modi’s Prime Ministership’, p. 77.
50. ‘Manufacturing job growth remains under stress’, Business Standard, 20 Oc-
tober 2015.
51. Radhicka Kapoor, ‘Creating jobs in India’s Organised Manufacturing Sec-
tor’, ICRIER Working Paper, No. 286, New Delhi 2014.
52. ‘Modi’s Big Make-in-India Problem: Fewer Factory Jobs’, Indiaspend, 14 Jan-
uary 2015.
350
IndIa 2015
render no less than 402 million people skilled between 2015 and 2022.53
This is potentially an extremely important policy initiative, as, paradoxical-
ly enough in a context of prolonged jobless growth,54 India’s entrepreneurs
struggle to find qualified workers.55 This comes as no surprise if one bears in
mind that only 4% of India’s workforce has received any formal training.56
The previous UPA government had launched its own National Skill
Policy in 2009, but very little was achieved. At the time of writing it is not
possible to say in what respects the new policy differs from the old one.
What seems clear is that officials in the newly established Ministry of Skill
Development and Entrepreneurship hardly appear confident about the suc-
cess of the new initiative.57
2.6. The continuing rural crisis

2.6.1. The long term and contingent causes of the rural crisis
The poverty of India’s primary sector has been a major economic pro-
blem since the colonial period. After independence the situation has im-
proved, but only up to a point. Anyway, the economic reforms launched
in 1991 ended a period of relatively high public investments in the rural
sector, which had started with the launch of the Green Revolution in the
mid-1960s. Not very surprisingly, but against the expectations of India’s
policy makers, private investments, also because of a series of legal norms
that make agriculture a very risky business,58 did not compensate for the
decreasing intervention of the state in the primary sector. During the UPA
1 and 2 governments, a number of anti-poverty policies were introduced,
the most significant among them being the MGNREGA. This, together with
53. ‘Employment generation, skill development top priorities: Narendra Modi’,

Livemint, 16 July 2015.
54. Sonia R. Bhalotra, ‘The puzzle of jobless growth in Indian manufacturing’,
Oxford bulletin of economics and statistics, Vol. 60, No. 1, 1998, pp. 5-32; Michele Ales-
sandrini, ‘Jobless growth in Indian manufacturing: A Kaldorian approach’, CEFIMS
Discussion Paper 99, London, 2009.
55. ‘Widespread Skill Gaps Revealed Among Indian Workers’, Indiaspend, 14
September 2015; ‘India Graduates Millions, but Too Few Are Fit to Hire’, The Wall
Street Journal, 5 April 2011.
56. ‘The nuts and bolts of skill development’, The Hindu, 23 March 2015.
57. ‘Uphill task for Skill India mission’, The Hindu, 23 September 2015.
58. These were listed by The Economist as «sudden spikes in food prices», caused
by erratic impositions of export bans both by the central and state governments and
by the operation of a 1955 law «that bans the storage of large quantities of any of
90 commodities, including onions and wheat». This was compounded by the frag-
mentation and distortion of the domestic market, caused by the restrictions in fruit
and vegetable trade imposed by the states’ Agricultural Produce Marketing Commit-
tees. These restrictions, which sometimes fragmented even the market inside a single
state, had the paradoxical result of making it sometimes easier and cheaper to buy
those same products abroad. See ‘In a time warp’, The Economist, 27 June 2015.
351
robust economic growth throughout the period, had a significantly positive

effect on the rural areas in general, and on poverty reduction in particular.59
However, the most recent data indicate that the rate of growth of farm in-
come declined in 2015 and that non-farm income in rural areas «remained
flat at best».60
As a result of the above listed long-term problems, Indian agriculture
in the period under review presented a dismal enough picture. Data relea-
sed by the National Sample Survey Organisation (NSSO) at the end of 2015
indicated that nearly 70% of farmers subsisted on farm holdings which were
economically unviable, being less than a hectare in size. Not surprisingly,
over one-fifth of farm households did not report farming as the primary
source of their income, but rather salaried employment. An additional 44%
had to supplement their limited income by seeking work under the MGN-
REGA.61 Finally, according to government data for the year 2014, 52% of
India’s agricultural households were indebted.62
What made this gloomy agricultural situation particularly worrying
was the fact that, although farming accounted for only 15% of India’s US$ 2
trillion economy, it still provided a livelihood to some 60% of its 1.25 billion
people.63 This means that the situation of the rural sector was bound to hea-
vily impact the general state of the Indian economy. As explained to Naren-
dra Modi by «some prominent billionaires» whom he met with in September
2015, falling rural demand for goods such as television sets, motorcycles,
and tractors was bound to adversely effect Indian industrial production and
the whole Indian economy.64
59. The data of the second round of the Human Development Survey shows
that growth during the UPA regime was indeed inclusive and that the MGNREGA
alone prevented 14 million households from falling into poverty. See Sonal Desai,
Prem Vashishtha & Omkar Joshi, Mahatma Gandhi National Rural Employment Guaran-
tee Act – A Catalyst for Rural Transformation, New Delhi: National Council of Applied
Economic Research, 2015.
60. The above was the conclusion of a survey carried out by the brokerage firm
J.M. Financial. See ‘Why higher govt spending is crucial to contain rural distress’, First
Post, 16 November 2015.
61. ‘Rural distress intensifies’, Business Standard, 9 December 2015.
62. Press Information Bureau, Government of India, Ministry of Statistics &
Programme Implementation, Key Indicators of Situation of Agricultural Households in
India, 19 December 2014 (http://pib.nic.in/newsite/PrintRelease.aspx?relid=113796).
63. Govt. of India, Ministry of External Affairs, Investment and Technology
Promotion Division, India in Business, Agriculture, October 2015 (http://indiain-
business.nic.in/newdesign/index.php?param=economy_landing/213/2); IBEF – In-
dia Brand Equity Foundation, Indian Agriculture Industry: an overview, March, 2016
(http://www.ibef.org/industry/agriculture-india.aspx). See also: Ajeet Kumar, ‘Budget
2015: The need for an overhaul in Indian agriculture sector’, Zee News, 28 February
2015; Rajendra Jadhav & Mayank Bhardwaj, ‘For Modi’s year-old government, storm
brewing in rural India’, Reuters, 15 May 2015;
64. Zia Haq & Gaurav Choudhury, ‘India’s rural crisis, slowed farm growth may
hurt 7.5% GDP dream’, Hindustan Times, 10 October 2015.
352
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In the period under review, the long-term problems afflicting Indian

agriculture were compounded by a series of contingent but momentous
events. These events were of two main kinds: natural and related to the
global economic situation.
In 2014, El Niño – the climatic phenomenon caused by the exceptional
warming of the Pacific Ocean, which causes droughts in large swathes of the
globe and excessive rains and floods in others – started to manifest itself
once again.65 As a consequence, in India, rains were 12% below normal,
which caused a 4.7% diminution in grain production in the twelve months
ending in June 2015. This was followed by a worsening of the climatic situa-
tion, characterised by «unseasonal rains that damaged India’s winter har-
vest in March and April»,66 followed by monsoon rains 14% below par in
June-September 2015.67 As a consequence, according to the Indian Mete-
orological Department, already in October 2015 nearly half of the Indian
districts – a total of 320 – had been afflicted by a deficiency in rainfall of
at least 20%.68 Considering that roughly half of India’s cultivated land lack
irrigation, this could have disastrous consequences.69 In fact, an in-depth
drought impact assessment conducted during the Summer months of 2015
by the Swaraj Abhiyan in seven districts in southern Uttar Pradesh – one
of the drought worst hit states – suggested that «the drought may well be a
famine».70
An additional natural event that adversely affected the rural produc-
tion of perhaps the best irrigated state in India, namely Punjab, was the
whitefly infestation of cotton. This happened in spite of the fact that the
local cotton, the Bt type, is supposedly pest-resistant. In November 2015,
according to a Press Trust of India report, Punjab’s cotton output was likely
to shrink by 40%.71
65. On the El Niño or ENSO climatic oscillations and their consequences, see
Mike Davis, Late Victorian Holocausts. El Niño Famines and the Making of the Third World,
London: Verso, 2001, particularly part III.
66. ‘Rural distress worsens across India’, Livemint, 1 December 2015.
67. Mayank Bhardwaj & Rajendra Jadhav, ‘Modi fiddles as drought shrivels
India’s crops’, Sustainability, 9 September 2015 (http.//sustainability.thomsonreuters.
com).
68. ‘India’s drought burden’, Livemint, 29 October 2015.
69. ‘In a time warp’, The Economist, 27 June 2015.
70. Devanik Saha, ‘Bundelkhand Survey Paints a Dire Picture of Rural Distress’,
The Wire, 27 November 2015. The Swaraj Abhiyan is a declaredly apolitical organiza-
tion founded on 14 April 2015 by Yogendra Yadav and Prashant Bhushan, after their
expulsion from the Aam Aadmi Party, which has mainly been engaged in the defence
of farmer rights. The drought impact assessment in southern U.P. was conducted
with the help of the well-know Belgian-born economist Jean Drèze in the districts of
Jhansi, Jalaun, Lalitpur, Chitrakoot, Banda, Hamirpur and Mahoba. See the Swaraj
Abhiyan official site: http://www.swarajabhiyan.org.
71. ‘Why higher govt spending is crucial to contain rural distress’.
353
The climatic difficulties were coupled with difficulties related to the

global economy, which resulted in an 11% fall in India’s farm exports in
the October 2014–March 2015 crop season.72 Moreover, international fac-
tors adversely affected the production of a number of Indian crops. In
particular, cotton and non-basmati rice exports were affected by China’s
decision to put an end to cotton stockpiling and by Thailand’s decision to
diminish its rice stocks, respectively.
Indian sugar was made uncompetitive in the international market by
the decline in world sugar prices, caused by the devaluation of the real, the
currency of Brazil, the world’s main sugar producer; Indian sugar, soy, bar-
ley and basmati, formerly bought at a premium by an Iran hemmed in by
world sanctions, after the easing of such sanctions started to be substituted
by less expensive goods produced by other countries; the fall in global cru-
de oil prices, on the one side, had an adverse effect on the competitiveness
of Indian grains and oilseeds used for biofuels and, on the other side, by
cutting down freight costs, made South America-produced soy and corn
competitive in the Indian market. Last but not least, the strength of the
rupee during the year under review put Indian exports at a disadvantage
and favoured imports.73
2.6.2. The Modi government’s slow response to the rural crisis

In May 2014, the BJP manifesto had promised that farmers would
earn a 50% profit over their total input costs.74 Although often repeated by
Modi during the electoral campaign, once the new government was in pla-
ce, this particular electoral promise seems to have rapidly been forgotten.
This, it seems, happened as a consequence of the advice of two influential
neoliberal economists: Dr. Arvind Subramanian (Chief Economic Advisor
(CEA) to the Government of India since October 2014) and Dr. Arvind
Panagariya (as already mentioned, the vice-chairman of the Niti Aayog).75
In November 2014, both Subramanian and Panagariya warned the Indian
Government that higher agricultural procurement prices could trigger a
surge in inflation.76 As a consequence, the minimum government support
price for staples – in particular wheat and rice – was cut, badly affecting
the level of rural incomes.77
72. Rajendra Jadhav & Mayank Bhardwaj, ‘For Modi’s year-old government,
storm brewing in rural India’, Reuters, 15 May 2015.
73. Ibid.
74. ‘Framers’ Plight Caused BJP Debacle in the Rural Gujarat Panchayat
Polls’, The Wire, 3 December 2015.
75. M.K. Venu, ‘Indian Farmer is Suffering and Desperately Needs Help’, The
Wire, 24 September 2015.
76. Ibid.
77. ‘In a time warp’.
354
IndIa 2015
In the analysis of The Economist, although the above decision «was the
right move, and has since helped bring down inflation», it, nevertheless,
«should have come with more transitional support for farmers hurt by the
adjustment».78 On top of that, after the decision was taken, soft commodi-
ties prices79 crashed, making the situation desperate for Indian farmers.80
The most glaring indication of the increasing desperation of the Indian
farmers was the sudden raise in farmers committing suicide, which has
been reported with increasing frequency by the domestic press.81
In this situation, even some economists close to the government star-
ted to express their concern. In the words of agricultural economist and
advisor to the Niti Aayog on agriculture, Dr. Ashok Gulati, the situation
was «so grim» that, without «a sustained incentive structure for the far-
mers, India could slip back to the era of food shortages experienced in
the 1960s».82 For his part, D.H. Pai Panandiker, president of the Mumbai-
based RPG Foundation, which houses a macroeconomic policy think-tank,
expressed the fear that, considering the challenging agricultural situa-
tion, farm output in the 2015-16 fiscal year could shrink «by as much as 4
per cent, which would be the first [agricultural output] contraction since
2002/03».83
Strangely enough, the response of the Modi government to this si-
tuation was slow and not commensurate with the increasing gravity of the
situation. The consequences of this lack of attention was that, during the
year under review, no well thought-out and comprehensive strategy aimed
at remedying the many ills affecting Indian agriculture was ever concei-
ved, and much less implemented. What was to be implemented were a set
of piecemeal ad hoc decisions, which could not but be judged, particularly
by those affected by the deepening agrarian crisis, except as examples of
«too little, too late» stopgap remedies.
The most important of these ad hoc remedies was the decision to
moderately increase the minimum support prices (MSP) for grains and
pulses. In addition, the central government raised the compensation for
crop damage and set more generous rules for claiming it.84 Moreover it
asked state governments to draw from the more than US$ 1 billion allotted
78. Ibid.
79. The term «soft commodities» generally refers to commodities that are
grown, rather than mined.
80. M.K. Venu, ‘Indian Farmer is Suffering and Desperately Needs Help’.
81. Indeed, in 2015 the phenomenon of farmer suicides once again became
conspicuous enough to attract the attention of non-Indian press. See, e.g., ‘India’s
shocking farmer suicide epidemic’, Al Jazeera, 18 May 2015.
82. M.K. Venu, ‘Indian Farmer is Suffering and Desperately Needs Help’.
83. ‘Rural economy may contract for first time in 10 years as drought looms’,
Business Today, 15 June 2015.
84. ‘Narendra Modi promises higher compensation for farmers hit by unsea-
sonal rains’, Livemint, 9 April 2015.
355
to the State Disaster Response Fund, for which the centre provides 75%
of the funds, and raised compensation by 50% for farmers suffering crop
losses. At the same time, quality requirements for wheat purchases by state
agencies were lowered, import taxes on rubber and sugar were lowered,
and raw sugar exports promoted through an incentive.85
However, in practical terms, these apparently generous provisos were
gravely insufficient. Even when compensation reached the farmers – which
depended on a set of circumstances, including the decision of the particu-
lar states to declare a situation of drought and the farmers being the owners
of the damaged land and being indebted with a bank – they covered less
– sometime considerably less – than a fifth of the damage.86
As far as the suicides of farmers were concerned, compensations were
provided to the families. But the rules for allowing these compensations
varied from state to state, were more or less restrictive87 and, once again,
insufficient to provide for the bereft families.88
More generally, what was striking in the government’s response was
not only – as noted above – the complete lack of a general well-thought out
plan to cope with the mounting rural distress, but the lack of willingness to
fully make use of the instruments already available. In the words of Harsh
Mander, a former district collector and present human rights activist, who
reported his impression after visiting the rural district of Banda (U.P.):
«The response of state administration to looming drought is disgracefully
dismal and listless, lacking entirely in both urgency and compassion. Peo-
ple showed us empty job cards; public works under the MGNREGA, the
most effective instrument to prevent distress migration, were nowhere to
be found. Wages from earlier work had not been paid for over a year. Even
more gravely, neither the Central nor the state government is serious about
rolling out the National Food Security Act that should lawfully have com-
menced a year and a quarter ago. It would have ensured the availability of
85. Rajendra Jadhav & Mayank Bhardwaj, ‘For Modi’s year-old government,
storm brewing in rural India’.
86. ‘For drought-hit farmers, higher compensation still a pittance’, Livemint, 2
November 2015.
87. E.g., in eight Maharashtra districts, which, in the year under review up to
27 December had registered 1,109 suicides, the families of only 698 among them
were eligible for government compensation. ‘112 distressed farmers commit suicide
in a month in drought-hit Marathwada’, The Indian Express, 29 December 2015. This
was sometimes caused by the fact that, in cases of suicide by poisoning, the author-
ities could indicate the death as due to «natural causes». Zigor Aldama & Miguel
Candela, ‘India’s Deadliest Epidemic’, The Diplomat, 20 October 2015. See also ‘Ma-
harashtra farmer suicides: 50% of kin denied relief ’, Times of India, 9 February 2015.
88. In certain cases, the decision of some states to hike the compensation for
the families of farmers who had committed suicide was criticized as conducive to
encouraging more suicides. ‘Farmer suicides: Telangana govt hikes compensation’,
The Week, 20 September 2015.
356
IndIa 2015
half of each household’s monthly cereal requirements almost for free for
more than 80 per cent of households».89
When all this has been noted, it is worth stressing that, as noted
by Harsh Mander himself, the callousness of the central and most state
governments as far as the plight of the rural population was concerned
was accompanied by – and possibly was a function of – the indifference of
the educated public with respect to this problem. In fact, the abundance
of quotations concerning the rural population’s plight present in this
chapter should not conceal the fact that, as a rule, the attention given
by the Indian media to this issue has been minimal and erratic.90 As no-
ted once again by Harsh Mander: «Farmers and landless workers in 11
states are crashed by drought, often for three years in a row, but if you
scan newspapers and television screens, debate in Parliament and mee-
tings in state secretariats, it would appear that this is a figment of some
imagination». «This, indeed, – concluded Mander – is what some senior
journalists and officials said to me, or implied – that we are inventing a
story of drought hunger».91
2.7. Macroeconomic Performance

2.7.1. A positive U-turn in the GDP rate of growth?
In spite of the mixed success of the economic policies listed above,
during the year under review the macroeconomic indexes appeared to
experience an impressive improvement. Consumer price inflation, which
had been a major problem in the UPA-2 years, was put under control, as
shown in chart 1 and table 1. This was mainly due to the already men-
tioned steep decline of the oil price at the global level.92 As a consequence,
the Reserve Bank of India (RBI) significantly cut interest rates, a move that
was welcomed by the business community.93
89. Harsh Mander, ‘The invisible drought’, The Wire, 8 February 2016.
90. The situation still remains very much the same as that described in Vipul
Mudgal, ‘Rural Coverage in the Hindi and English Dailies’, Economic and Political
Weekly, Vol. XLVI, No. 35, 27 August 2011, pp. 92-97. According to Mugdal’s study
of each three of India’s highest circulated English and Hindi dailies, the proportion
of their total coverage related to rural India’s issues, crises, and anxieties was mi-
nuscule, being equal to about 2%.
91. Ibid.
92. ‘Dear Mr Jaitley, it’s time to get real – about real reforms’, scroll.in, 13
September 2015.
93. ‘Raghuram Rajan Does’, The Hindu Business Line, 29 September 2015.
357
Chart 1 - Monthly Inflation in India 2015, CPI (Consumer Price Index)

The average inflation of India in 2015 = 5.88%94
Table 1 - 2015 inflation India (CPI)
Inflation Inflation
Inflation % Inflation%
(monthly basis) (yearly basis)
Jan 2015 - Dec 2014 0.40 Jan 2015 - Jan 2014 7.17
Feb 2015 - Jan 2015 -0.39 Feb 2015 - Feb 2014 6.30
Mar 2015 - Feb 2015 0.40 Mar 2015 – Mar 2014 6.28
Apr 2015 - Mar 2015 0.79 Apr 2015 - Apr 2014 5.79
May 2015 - Apr 2015 0.78 May 2015 - May 2014 5.74
Jun 2015 - May 2015 1.16 Jun 2015 - Jun 2014 6.10
Jul 2015 - Jun 2015 0.77 Jul 2015 - Jul 2014 4.37
Aug 2015 - Jul 2015 0.38 Aug 2015 - Aug 2014 4.35
Sep 2015 - Aug 2015 0.76 Sep 2015 - Sep 2014 5.14
Oct 2015 - Sep 2015 1.13 Oct 2015 - Oct 2014 6.32
Nov 2015 - Oct 2015 0.37 Nov 2015 - Nov 2014 6.72
Dec 2015 - Nov 2015 -0.37 Dec 2015 - Dec 2014 6.32
Inflation rates in the table are presented both on a monthly basis (compared to the
month before) as well as on a yearly basis (compared to the same month the year
before).95
94. Inflation.eu Inflation India 2015 (http://www.inflation.eu/inflation-rates/in-

dia/historic-inflation/cpi-inflation-india-2015.aspx).
95. Inflation India 2015, Inflation.eu (http://www.inflation.eu/inflation-rates/in-
dia/historic-inflation/cpi-inflation-india-2015.aspx).
358
IndIa 2015
As far as the real GDP (Gross Domestic Product) is concerned, official

government data unveiled on 9 February 2015 showed that India had be-
come the fastest growing country among the major economies, overcoming
China, 96 a success that was much celebrated by the Indian media. However,
the Indian media rarely pointed out that, a the end of the day, China’s
economy was still four times the size of India’s and that, as noted by Ashish
Kumar, director general of the Indian Central Statistics Office, if India con-
tinued to grow at the same speed as in 2014-15 and China continued to
perform at the lower level of the last few years, «then still it will take 20 to
30 years [for India] to catch up [with China]».97
Once this has been pointed out, it remains the fact that, according to
the official data, the rate of growth of India’s real GDP (Gross Domestic
Product) was equal to 7.3% in the fiscal year 2014-15 and to 7.25% for the
calendar year 2015.98 The quarterly growth from October 2014 to Decem-
ber 2015 is given in Table 2.
Table 2 - Growth of the real gross domestic product (GDP) from 3rd quar-
ter 2014 to 3rd quarter 2015 (compared to the same quarter of the pre-
vious year)99
Q2 2015 Q3 2015
Q3 2014 Q4 2014 Q1 2015
July- October-
October-December January-March April-June
September December
8,4% 6,6 % 7.5% 7% 7.4%
Source: Statista – The Statistics Portal
(http://www.statista.com/statistics/276947/gross-domestic-product-gdp-growth-in-
india-by-quarter)
At first sight the growth in the six quarters ending with October-De-
cember 2015 represents a radical U-turn when compared to the sluggish
rate of growth of the UPA-2 period (given in Table 3).
96. ‘India Passes China to Become Fastest-Growing Economy’, IndiaRealTime,

The Wall Street Journal, 11 February 2015.
97. Ibid.
98. ‘India’s economy grew at 7.3 per cent in 2014-15 fiscal’, The Indian Express,
30 May 2015; ‘GDP Growth of India’, Statistics Times, 24 August 2015; India: ‘Real
gross domestic product (GDP) growth rate from 2010 to 2020 (compared to the pre-
vious year)’, Statista – The Statistics Portal (http://www.statista.com/statistics/263617/
gross-domestic-product-gdp-growth-rate-in-india).
99. Economic Survey 2013-14 (http://indiabudget.nic.in), pp. 1-3; Interim
Budget 2014-2015. Speech of P. Chidambaram, Minister of Finance, 17 February
2014, § 14.
359
Table 3 - The GDP rate of growth during the UPA-2 government accor-
ding to the old methodology
Financial year 2009-10 2010-11 2011-12 2012-13 2013-14
GDP rate of growth 8,6 9,3% 6,2% 5% 4.9%
However, the rosy picture given by the above data needs some qualifi-
cations. The first is that the new figures were the result of a new methodo-
logy plus a change in the base year from 2004-05 to 2011-12.100
Here, the first problem is that most economists – including RBI go-
vernor Raghuram Rajan and the Narendra Modi government’s new CEA
Arvind Subramanian – were clearly uncertain about the reliability of the «in-
credible (in both senses of the word) new numbers».101 Accordingly, Raghu-
ram Rajan appeared unwilling «to take a strong view» based on the updated
data. 102 For his part, Arvind Subramanian pointed out that the new figu-
res were «mystifying because these numbers, especially the acceleration in
2013-14 [when, according to the new methodology, the GDP rate of growth
was 6.9%, instead of 5%, as shown by the old methodology], are at odds
with other features of the macroeconomy».103 As explained by Subramanian:
«The year 2013-14 was a crisis year – capital flowed out, interest rates were
tightened and there was consolidation – and it is difficult to understand how
an economy’s growth could be so high and accelerate so much under such
circumstances».104
A second (political) problem with the new methodology, implicitly hi-
ghlighted in the above quoted CEA’s remarks, was that, when applied to the
rate of growth during the UPA-2 government years, it unequivocally showed
that the positive turn-around in the economy had happened before the Mo-
di’s government came to power, as shown in Table 4.
100. ‘India’s Passes China to Become Fastest-Growing Economy’; ‘GDP growth

estimated at 7.4% for 2014-15, Oct-Dec growth at 7.5%’, The Times of India, 10 Febru-
ary 2015; ‘New GDP methodology «puzzling», shows growth in bad year: CEA’, The
Times of India, 27 February 2015.
101. ‘Even the RBI’s Rajan [sic] is Confused by India’s New GDP Numbers’,
IndiaRealTime, The Wall Street Journal, 3 February 2015. Significantly the RBI kept its
forecast for GDP growth for the fiscal year 2014-15 at 5.5% «and, notably, continued
to report the forecast using the old base year». See also ‘New GDP methodology
«puzzling», shows growth in bad year: CEA’; ‘Don’t rush in using new GDP data for
policies: Arvind Subramanian’, Business Standard, 3 February 2015.
102. Ibid. Also ‘New GDP methodology «puzzling», shows growth in bad year:
CEA’.
103. ‘Don’t rush in using new GDP data for policies: Arvind Subramanian’.
104. Ibid.
360
IndIa 2015
Table 4 - Growth of the real gross domestic product (GDP) in India from
2010 to 2015105
2010 2011 2012 2013 2014 2015
10.26% 6.64% 5.08% 6.9% 7.29% 7.26%
At the end of the day, the credit for the positive U-turn of the Indian
economy must either go to the Central Statistical Organization, which re-
vised the national statistics in January 2015,106 or to the policies imple-
mented during the last phase of the UPA 2 government. Most probably – as
noted, among others, by the authors of this chapter – the economic recovery
had indeed started during 2014, 107 but the extent of this recovery has been
amplified by the new GDP methodology.
2.7.2. The economy beyond the GDP

Should the official GDP data be taken at face value, the conclusion
would be that the economic situation could not but be considered a quite
positive one. This being the situation, one would expect a quite optimistic
outlook on the part of the general public and, particularly, the business
community. This, however, was not the case. As noted by Harvard educated
Indian economist Mohan Guruswamy: «Whenever and wherever business
people meet, the conversation invariably veers to flattening sales and fall-
ing profits despite the government crowing that the real GDP is growing
at 7.4%».108 This negative perception was shared by credit rating agency
Standard & Poor’s, which refused to change India’s credit rating from just
above «junk».109
According to Guruswamy, the discrepancy between, on the one side,
the image of the economy conveyed by the official data and, on the other,
the perception on the part of business people and credit rating agencies
such as Standard & Poor’s can be explained by the nature of the macroeco-
nomic data employed by the Indian government. According to Guruswamy,
even if the official data were recognized as correct, a major problem in ac-
cepting them as an accurate image of India’s economic reality was related to
105. Statista – The Statistics Portal (http://www.statista.com/statistics/263617/

gross-domestic-product-gdp-growth-rate-in-india).
106. T.T. Ram Mohan, ‘A Reality Check for Modi on the Economy’, The Wire,
11 May 2015.
the Congress Party and the beginning of the Modi era’, pp. 287-289.
108. Mohan Guruswamy, ‘2015 has been a year of economic gloom for India.
Just look at the numbers’, Scroll.in, 7 December 2015.
109. ‘Wake up call from S&P’, The Financial Express, 21 October 2015.
361
the discrepancy between the real GDP rate of growth (taken into account in
the official data) and the nominal GDP rate of growth.110 It is on the basis of
the latter that most economic decisions are taken both by businessmen and
individuals and families.111
Here the problem was that, in the 2015 calendar year, the Wholesale
Price Index (WPI) declined below zero for the whole period (see charts 2 &
3), a trend which had begun in November of 2014. More precisely, the WPI
declined by 0.90% year-on-year in January of 2016, as compared to a 0.73%
drop in December.112 In other words, beginning in November 2014, the
Indian economy entered a period of deflation.113
Chart 2 –India’s Wholesale Price Index 2011-15114
All the above means that beginning in November 2014 the nominal
rate of growth was well below the real rate of growth. Indeed, according
to the government’s mid-year review, made public in December 2015, the
110. The nominal rate of growth indicates the rate of growth at the current
prices; the real rate of growth is calculated by discounting the rate of inflation from
the nominal rate of growth. As a consequence, usually the nominal rate of growth is
bigger than the real rate of growth.
111. Mohan Guruswamy, ‘2015 has been a year of economic gloom for India’.
See also Sitaram Yechury, ‘Forget the Data Fudge, Look at the Ground Reality’, The
Wire, 12 December 2015.
112. ‘India Wholesale Price Index Change 1969-2016’, Trading Economics
(http://www.tradingeconomics.com/india/producer-prices-change).
113. The WPI-related data are in sharp contrast with the CPI-related data,
which have been quoted above. For an introductory discussion on the problem cre-
ated by these two contrasting sets of data see N.R. Bhanumurthy, ‘Is India staring at
deflation?’, The Indian Express, 24 September 2015.
114. Trading Economics.
362
IndIa 2015
Chart 3 – India’s Wholesale Price Index January 2015- January 2016115
nominal GDP growth had sharply declined from 13.5% in 2014-15 to only
7.4% in the first two quarters 2015-16. As noted by well-known senior jour-
nalist and economy expert M. K. Venu: «This is almost like suggesting that
the income growth rate across the board is nearly halved!»116 The govern-
ment itself acknowledged that: «The sharp and continuing decline in nom-
inal GDP growth, as well as the fact that the economy is powered only by
private consumption and public investment – is a cause for concern».117
This «dramatic slowdown in nominal GDP growth» witnessed, as a
consequence, «the extremely low growth in corporate earnings».118 Hence
the business community’s despondency, noted above. The nominal GDP
slowdown could not but adversely affect future investment decisions on the
part of Indian companies. This, in turn, did affect employment and salary
growth in the organized sector, which, in the year under review, «experi-
enced the worst retrenchment, the scale of which has not been seen in the
past two decades».119 All this catastrophically dovetailed with the deepening
agricultural crisis. The all too real crises in both the secondary and primary
sectors could not but impinge on the unorganised sector, further depressing
the internal demand. On top of all this, exports experienced «an unprece-
dented decline» in 2015.120
115. Ibid.
116. M. K. Venu, ‘The Economy Isn’t Turning Out the Way We Are Told’, The
Wire, 31 December 2015.
117. Ministry of Finance, Department of Economic Affairs, Economic Division,
Mid-Year Economic Analysis 2015-2016, 2015, p. 15.
118. Ibid.
119. Ibid.
120. ‘Unprecedented Decline’, Economic and Political Weekly, 16 January 2016,
pp. 7-8.
363
Summing up, once one goes beyond the over-optimistic official macro-
economic data, the situation of the Indian economy in 2015 looked far from
satisfactory and, certainly, very distant from the rosy hopes engendered by
Narendra Modi’s electoral promises.
3. Domestic Politics
Even as far as domestic politics are concerned, during 2015 not all
went well for Narendra Modi. The Prime Minister’s problems originated
from three interrelated factors. First, the BJP’s defeat in two important polls
(Delhi and Bihar) put into question the Prime Minister’s ability to win elec-
tions. Second, the Congress Party, which practically all analysts considered
to be in its death throes, quite unexpectedly put up a spirited and some-
times successful fight against the Modi government; finally the Prime Min-
ister struggled uneasily to reconcile his institutional role as Prime Minister
with the demands and actions of a number of Hindu extremist groups.
3.1. The Delhi and Bihar Elections

The state elections held in 2015 (and the local bodies election in Gu-
jarat and Uttar Pradesh) reveal a common pattern. This is that, compared
to 2014, the Modi’s wave had lost at least some of its steam and the Prime
Minister was not able to win elections on his own any longer.
On 10th February 2015, the results of the elections in Delhi were an-
nounced. It was a political earthquake.121 The Aam Aadmi Party (AAP –
«Party of the common man») led by Arvind Kejriwal obtained the largest
majority a party has ever captured since 1993, when the Delhi legislative
Assembly was reintroduced.122 Table 5 shows the number of seats and the
share of the vote obtained by the AAP, the BJP, and the Congress.
Table 5 Delhi Election results and comparison with the 2013 election123
Change in Change in
Party No. of Seats Vote Share
No. of Seats Vote Share
AAP 67 +39 54.3 +24.81
BJP 3 -28 32.2 -0.8
INC 0 -8 9.7 -14.85
Total 70 96.2
121. Milan Vaishnav, ‘A Rumble in Delhi’, Foreign Affairs, 11 February 2015.

122. It had been abolished in 1956.
123. Election Commission of India. www.eci.nic.in
364
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Apart from the smashing victory conquered by the AAP, the other most
noteworthy development to be noted is the disastrous performance of the
Congress. The party (which had ruled Delhi for three consecutive terms
from 1998 to 2013) failed to conquer a single seat and saw its vote share
plummet from 40.31% in 2008 to 9.7% in 2015.124
Another point worth stressing is that the poor performance of the BJP
was not so much due to any significant decline in the popular vote; rather,
it was the consequence of India’s first-past-the-post electoral system. It had
worked well for the BJP in the 2014 Lok Sabha elections, when the party
obtained 51.93% of the seats with 31.3% of the votes.125 However, the extra-
ordinary electoral performance of the AAP in 2015 translated into an even
more extraordinary vote-to-seat conversion rate.126
The failure of the BJP to replicate its impressive performance in Delhi
during the 2014 Lok Sabha election was mainly due to the poor choice of its
chief ministerial candidate.127 In January 2015 – less than a month before the
polls – the BJP started presenting Kiran Bedi (a well-known former Indian
Police Service officer, who had been an active militant in the Anna Hazare an-
ti-corruption movement) 128 as its chief minister candidate.129 The choice sur-
prised many, especially the local BJP leaders. Many of them resented the fact
that an outsider had been «parachuted» in by the national leadership onto
the Delhi political battlefield, and were upset because Bedi, when associated
with Anna Hazare’s anti-corruption movement in 2011, had been a sharp
critic of the BJP. 130 The very disappointing results obviously upset greatly the
local BJP leaders, who saw the defeat as the direct consequence of the «politics
of arrogance»131 of Modi and his principal lieutenant, Amit Shah, who had
managed the elections from the top, without involving the local party branch.
Bedi’s choice as the BJP’s chief ministerial candidate was also a demon-
stration of weakness. The party chose a candidate that had a lot in common
with her main rival, Arvind Kejriwal: both were known for their honesty and
124. See Sudha Pai, ‘Grand Ossified Party’, The Indian Express, 11 February 2015
for a lucid analysis of the state of the Congress.
126. For every 1% vote share, the AAP won 1.75 seats. The corresponding rate
of the BJP at the 2014 Lok Sabha election was 1 to 1.67.
127. Biswajit Mohanty and Jyoti Mishra, ‘Among factors that decided one’s
vote, CM preference was often the clincher’, The Indian Express, 12 February 2015.
128. Michelguglielmo Torri, ‘L’India nell’anno della crociata anti corruzione’,
Asia Maior 2011, pp. 128, 147, 149-156.
129. ‘Delhi Assembly elections: Kiran Bedi joins BJP; Amit Shah says CM choice
only after polls’, Indian Express, 16 January 2015.
130. ‘The Kiran Bedi effect: BJP’s Delhi unit is in a shambles’, Scroll.in, 19 Jan-
uary 2015.
131. ‘Voices in stunned BJP talk of ‘politics of arrogance’, The Indian Express, 11
February 2015.
365
integrity, both had been associated with the Anna Hazare anti-corruption mo-
vement, and both had entered politics comparatively late in life. In this way,
the BJP had endorsed the AAP’s argument that what Delhi needed was a new
type of politician, and, in so doing, had strengthened Kejriwal’s position, as the
latter appeared much more credible than Bedi in the role of a «new politician».
The extraordinary performance of the AAP was in many ways unex-
pected. The AAP had formed an Arvind Kejriwal-headed minority go-
vernment in Delhi, with the support of the Congress party, in 2013. Howe-
ver, after only 49 days, Kejriwal had stepped down. Many thought this was
a fatal error for the newly born party. The very disappointing performance
of the AAP at the Lok Sabha elections in 2014 (when it failed to conquer a
single seat in the capital)132 seemed to confirm this view.133
Kejriwal, however, did something completely unexpected at that point:
he apologised to the citizens of Delhi and to its own party for his mistakes134
and started a vigorous and carefully planned electoral campaign based on a
number of innovative initiatives such as the «Delhi Dialogues», flash mobs,
and clever and intensive usage of social media.135
Data collected by the Centre for the Study of Developing Society
(CSDS) show that, on the one hand, the AAP’s message resonated with a
very broad section of the electorate, cutting to a large extent across caste,
class and religious lines.136 However, CSDS data also show that the AAP was
the preferred party of the more marginalised communities and religious
minorities:137 77% of the Muslims, who had overwhelmingly voted for the
Congress in the past, 57% of the Sikhs, and 66% of the poor voted for Kejri-
wal.138 It is significant though that as many as 47% of the upper classes chose
the AAP (as against 43% who preferred the BJP).139 Overall, the CDSD post-
poll survey shows that corruption was the second most important issue for
Delhi’s voters (just after «price rise») and that Kejriwal was considered by
far the most credible chief minister candidate up to tackle the problem.140
132. The APP won only four seats nationally, all from Punjab.
133. On the AAP first government in Delhi and the political consequences of
its fall see Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihilation of
134. Ibid., p. 246 and the sources quoted in fn. 15. See, also, Vaishnav, ‘A Rumble’.
135. Goirick Brahmachari, ‘AAP, Left and their Cultural Tools’, Economic and
Political Weekly, 8 February 2015.
136. Shreyas Sardesai, ‘Delhi’s new Aambrella Party’, The Indian Express, 12 Feb-
ruary 2015.
137. Suhas Palshikar & Sanjay Kumar, ‘An Aam Aadmi beyond social strata, a
victory with a marked social profile’, The Indian Express, 12 February 2015.
138. Shreyas Sardesai, ‘77% Muslims, 57% Sikhs voted AAP’, The Indian Express,
12 February 2015.
139. Sanjay Kumar & Pranav Gupta, ‘Poor already behind it, AAP tapped
rich too’, The Indian Express, 12 February 2015.
140. CSDS, Delhi Assembly Election 2015 – Post Poll Survey Findings. Available
on the CSDS’s website: www.csds.in
366
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On the other hand, one should be cautious to interpret the results in

Delhi as a sign of the declining popularity of the Prime Minister. The CDSD
survey shows that 65.5% of the electorate was «fully satisfied» or «somewhat
satisfied» with Modi’s government.141 But it is nevertheless clear that the
BJP cannot win state elections just hoping that the «Modi wave» will last fo-
rever. The message of the Delhi electorate was precisely this: the BJP cannot
«parachute» candidates from above, especially if other parties have strong
and locally popular candidates. The result of the Delhi elections was also a
shot in the arm for Modi’s internal opposition,142 which had been resentful
at the high degree of centralisation in the management of party affairs.
A similar lesson can be drawn from the results in Bihar. The state went
to the polls in October-November 2015. Table 6 offers a synthetic view of
the results.
Table 6 - Bihar elections results and comparison with the 2010 elections143
Change No. Vote Change Vote

Alliance Party Seats
of Seats Share Share
Janata Dal (U) 71 -44 16.8 -5.81
Rashtriya
80 +68 18.4 -0.44
Grand Janata Dal
Alliance Congress 27 +23 6.7 -1.68
Total Grand
178
Alliance
BJP 53 -38 24.4 +7.94
Lok Janshakti
2 -1 4.8 -1.95
NDA Party
Other NDA 3 NA 4.9 NA
Total NDA 58
It is difficult to compare the 2015 results in Bihar with the previous

state election in 2010 because of the complete change in the political lan-
dscape in the intervening years. Two major developments were significant.
First, when Narendra Modi was chosen in 2013 as the NDA’s Prime Mini-
sterial candidate, the chief minister of Bihar and leader of the Janata Dal
(United) or JD(U), Nitish Kumar, decided to break the 17-year old alliance
with the BJP.144 Second, at the 2014 Lok Sabha elections in Bihar the spec-
141. Ibid.
142. ‘A short guide to whom the BJP and its supporters are blaming for the
Delhi debacle’, Scroll.in, 11 February 2015.
143. Election Commission of India.
144. Michelguglielmo Torri, ‘L’India nell’anno della legge sulla sicurezza ali-
367
tacular performance of the BJP – which gained 22 out of 40 seats – and the
catastrophic results for the JD(U) – which crashed down from 12 to 2 seats –
produced two main consequences among the political forces which were on
the losing side. The first was Nitish Kumar’s resignation as Chief Minister in
May 2014.145 The second was that the electoral results alarmed not only the
JD(U), but also the other main regional party of Bihar, the Rashtriya Janata
Dal (RJD), led by Lalu Prasad Yadav. Although the two parties have been
at daggers drawn since the JD(U)’s creation on 30 October 2003, the 2014
electoral results were worrying enough for both parties to convince them
to bury the hatchet and form (together with the locally almost irrelevant
Congress party) a «Grand Alliance».146
These two important political developments make it very difficult to
assess the changes in the parties’ electoral performance. For example, the
declining vote share of the JD(U) was almost entirely due to the fact that
the party contested a significantly lower number of seats because of the
seat-sharing agreement with the RJD.147 Similarly, the BJP’s vote share in-
creased, but, again, this was mostly due to the increased number of seats it
contested.
The BJP’s original plan was to confront the Bihar’s voters with a choice
between development (Modi) and caste politics (Nitish and Lalu). Accor-
dingly, the Prime Minister was to be the focal point of the BJP’s campaign,
so much so that the party did not even name a potential chief minister
candidate.
However, after the first phase of polling, BJP’s leaders started feeling
that the party’s prospects were not as good as hoped. This had a significant
impact on the BJP’s campaign in two ways. First, the duo Narendra Modi-
Amit Shah – who in the first phase of the campaign had dominated the par-
ty’s billboards and advertisements throughout the state – disappeared, to be
replaced by local party leaders.148 This was an attempt to shelter the Prime
Minister in case of defeat. Second, the BJP decided to shift the emphasis of
its campaign from development to caste and religious polarisation.149
mentare’, Asia Maior 2013, p. 126 and the sources quoted there. See also ‘JD(U) severs
ties with BJP on Modi issue’, The Hindu, 16 June 2013.
145. ‘Bihar chief minister Nitish Kumar resigns’, The Times of India, 17 May
2014. On the 2014 elections in Bihar, see Michelguglielmo Torri & Diego Maiorano,
‘India 2014: the annihilation of the Congress Party and the beginning of the Modi
era’, pp. 266-69.
146. See Suhas Palshikar, ‘Lalu, Nitish aur Woh’, The Indian Express, 10 June
2015.
147. ‘Bihar polls: Nitish Kumar releases «joint list» of 242 candidates, OBCs get
lion’s share’, The Indian Express, 23 September 2015.
148. ‘Bihar leaders replace Modi in election ads as BJP gets an attack of nerves’,
Scroll.in, 15 October 2015.
149. Neelanjan Sircar, Bhanu Joshi & Ashish Ranjan, ‘How Modi surrendered
Bihar’, The Hindu, 9 November 2015.
368
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A few examples are sufficient to highlight this shift. At a public rally on

25th October, Modi alleged the existence of a secret plan of the Grand Al-
liance to take away 5% of the existing reservation quota – allotted to Dalits,
Extremely Backward Castes (EBCs) and Other Backward Classes (OBCs)
– giving it to Muslims.150 A few days later, Amit Shah said that a victory for
the Grand Alliance would be celebrated with firecrackers in Pakistan.151 At
the beginning of November – just a few weeks after a Hindu mob assas-
sinated in Dadri, in neighbouring Uttar Pradesh, a Muslim suspected of
keeping cow meat in his house152 – the BJP displayed billboards portraying
a woman hugging a cow with a headline saying «Nitish Kumar Ji, your allies
kept insulting the holy cow of every Indian and you kept quiet!»153 Tele-
vision ads, on the other hand, reminded the voters of Narendra Modi’s
OBC background and the fact that the Grand Alliance leaders could not
stomach his ascendancy to the country’s highest office, because of his caste
background.154 The list could be much longer.
The strategy did not work.155 On the one hand, those for whom cows
are a crucial political issue would most probably vote for the BJP anyway. On
the other hand, religious polarisation mainly had the effect of consolidating
the Muslims vote behind the Grand Alliance. There is also some evidence
that shows that the BJP performed only marginally better in districts more
affected by religious riots.156 The attempt to woo OBCs, EBCs and Dalits
did not work either, as the BJP offered a disproportionate number of seats
to the upper castes.157 On the other hand, the Grand Alliance was able
to expand its social base among Muslims, OBCs, and EBCs, especially in
rural areas.158 Throughout the campaign, the BJP-led alliance managed to
mobilise the upper castes only, the only exception being the Paswan Dalits,
150. ‘Modi alleges plot to take away SC, ST, OBC quotas’, The Hindu, 26 Octo-
ber 2015.
151. ‘Amit Shah’s firecrackers in Pakistan remark an insult to Biharis: Lalu Pras-
ad’, The Indian Express, 30 october 2015.
152. More on this below.
153. ‘BJP’s ad on cow slams Nitish Kumar ahead of final phase of polling in Bi-
har’, The Indian Express, 4 November 2015.
154. ‘What Bihar TV ads reveal: Forget development, for BJP it’s all about
caste’, Firstpost, 29 October 2015.
155. James Manor provides convincing evidence that the BJP lost the elections
because of the way in which it managed the electoral campaign. See James Manor,
‘The Campaign and BJP «Missteps» Decide the Outcome: The Bihar State Election,
2015’, Economic and Political Weekly, forthcoming.
156. Sandeep Shastri, Sanjay Kumar & Suhas Palshikar, ‘Bihar post-poll survey:
Voters had better image of Bihar than PM Modi painted’, The Indian Express, 10 No-
vember 2015.
157. James Manor, ‘The Campaign and BJP «Missteps» Decide the Outcome:
The Bihar State Election, 2015’.
158. Ibid. See also, Rahul Verma & Nitin Mehta, ‘Bihar post poll survey: Dalits
dump NDA, rural Bihar stays out of its reach’, The Indian Express, 10 November 2015.
369
whose leader Jitan Ram Manjhi (briefly Chief Minister of Bihar when Nitish
resigned in 2014) had chosen to ally with the BJP.159
The Grand Alliance, more importantly, won the rhetorical battle on
development.160 In fact, Modi’s repeated attacks on Lalu and the «jun-
gle raj» that characterised Lalu’s chief ministerships in the 1990s did not
undermine Nitish Kumar’s image as an able administrator.161 Moreover,
CSDS data show that Modi’s rhetoric of Bihar being a hopelessly under-
developed state collided with the voters’ perception that Nitish Kumar
had indeed been able to bring about development during his two terms
(2005-10).162
This, in fact, was more than just a perception. Under Nitish Kumar
the state’s GDP grew at an unprecedented pace (albeit from a very low base)
both in absolute terms and as a share of all states’ GDP.163 There is evidence,
importantly, that this growth had been inclusive: not only did Kumar fund
and implement a number of social welfare schemes reasonably well,164 but
growth in agriculture, poverty reduction, and literacy rates improvements
have been among the highest in India.165 The results would thus confirm
the trend, identified by Milan Vaishnav and Reedy Swanson, according to
which Indian voters are more and more inclined to reward good economic
performance, at least at the state level. 166
Finally, it is worth noting that, like in the case of Delhi, leadership was
an extremely important issue for Bihar’s voters. Even though satisfaction
with Modi’s government at the centre was quite high – 71.6% of the voters
were fully or somewhat satisfied with the BJP-led government, according to
CSDS data167 – Nitish Kumar was by far the preferred choice for the chief
160. This does not mean that it did not play the caste card too. Far from it.
161. Much of the positive image of Kumar is due to his ability to restore law and
order after Lalu’s terms in office. Milan Vaishnav, ‘The Beginning of Modi’s End?’,
Foreign Affairs, 11 November 2015.
162. Sandeep Shastri, Sanjay Kumar & Suhas Palshikar, ‘Bihar post-poll survey:
Voters had better image of Bihar than PM Modi painted’.
163. Indeed, under Nitish Kumar Bihar had grown more rapidly than Gujarat.
See Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihilation of the
Congress Party and the beginning of the Modi era’, p. 265 and the sources there quot-
ed. See also ‘How Bihar has fared under Nitish Kumar’, Livemint, 12 October 2015.
the Congress Party and the beginning of the Modi era’, p. 265; Avani Kapur, ‘Lessons
from the Bihar model of development’, Business Standard, 12 November 2015.
165. Avani Kapur, ‘Lessons from the Bihar model’ and ‘This Chart Shows Why
Bihar Voters Stuck With Nitish Kumar’, The Wall Street Journal, 9 November 2015.
166. Milan Vaishnav & Reedy Swanson, ‘Does Good Economics Make for Good
Politics? Evidence from Indian States’, India Review, Vol. 14, No. 3, 2015.
167. Bihar Postpoll Survey Findings 2015, available on the CSDS’s website.
370
IndIa 2015
ministership.168 In Bihar too, the Modi-centric campaign – as a BJP leader

put it, Modi and Shah «hijacked the entire campaign without feeling the
pulse of the state»169 – and the choice not to name a chief minister candi-
date did not pay off. The lesson that the BJP learnt – and that Modi’s inter-
nal enemies were quick to highlight170 – was that an extremely centralised
management of the party does not work, even if at the top of it stands a
politician as popular as Narendra Modi.
Some more troubles for Modi came from the results of the elections for
local bodies (panchayats and municipal corporations) in two states, Gujarat
and Uttar Pradesh. In both cases the BJP suffered heavy losses.171
3.2. The Congress’ unexpected comeback

Another source of problems for the Prime Minister came from the op-
position parties and in particular from the Congress. After its resounding
defeat in 2014, the Congress was in serious trouble. Many thought that the
«Grand Old Party» was about to implode,172 as a number of senior leaders left
and many more seriously questioned the leadership of the Gandhi family.173
However, contrary to expectations, the party put up an increasingly
effective parliamentary fight against the Modi government and effectively
disrupted the legislative activity in Parliament, thus replicating the BJP’s
strategy during the UPA governments. Whereas this was certainly not a de-
mocratically healthy way of opposing the government, it suggested that the
Congress was not yet ready to be consigned to the dustbin of India’s political
history.
A turning point in Congress’s parliamentary strategy occurred fol-
lowing the results of the elections in Delhi, where the Congress failed to
conquer a single seat. This appeared – and undoubtedly was – as clear-cut
as any confirmation of the sad state of the party.174 However, rather parado-
xically, the results of the Delhi elections, by showing that Modi was not in-
vincible, encouraged the Congress to get its act together, mounting a more
168. Sandeep Shastri & Vibha Attri, ‘Post-poll survey: Bihar rates its favourite
CM Nitish Kumar as more capable than PM Narendra Modi’, The Indian Express, 10
November 2015.
169. Quoted in James Manor, ‘The Campaign and BJP «Missteps» Decide the
Outcome: The Bihar State Election, 2015’.
170. ‘BJP veterans revolt against Modi, Amit Shah after Bihar election debacle’,
Livemint, 11 November 2015.
171. ‘BJP suffers heavy losses in UP panchayat polls’, Hindustan Times, 3 No-
vember 2015; ‘Vinay Umarji & Vimukt Dave: Time to go beyond just the urban agen-
da’, Business Standard, 5 December 2015.
172. ‘Congress starts to crumble: «It’s a frightening scenario», says one party
leader, Scoll.in, 30 January 2015.
173. ‘Inside India: As Congress Unravels, Strength of Democracy Is at Stake’,
The Wall Street Journal, 4 February 2015.
174. Sudha Pai, ‘Grand Ossified Party, The Indian Express, 11 February 2015.
371
determined and eventually not totally ineffective resistance effort against

the Modi government. The main battleground of the Congress counterat-
tack was the fight against the Land Acquisition Ordinance.
3.2.1. The fight against the Land Acquisition Ordinance

As recalled above, the Land Acquisition Ordinance was one of several
ordinances on economic matters promulgated by the government between
the end of December 2014 and the first week of January 2015.175 Clearly, it
was considered a key initiative in favour of the business community. It emen-
ded the «UPA’s growth-killing Land Acquisition Act»,176 namely the last im-
portant piece of legislation enacted by the UPA-2 government in 2013.177 In
turn, the 2013 Land Acquisition Act had supplanted the Land Acquisition
Act of 1894, a law enacted in the colonial period, which, nevertheless, had
continued to be the rule of the land up until 2013.
The longevity of the 1894 Land Acquisition Act can be explained by
the fact that it gave a free hand to the state to take hold of any extension
of land, when it was «likely to be needed for any public purpose [or for a
company]»,178 without providing any adequate compensation to the former
owners. Accordingly, land was seized and the former owners were paid a
meagre amount (if any at all).
According to the Land Acquisition Act 2013, land could be expropria-
ted only if assent was given by at least 70% (if the expropriated land was
meant for public and public-private-partnership enterprises) or 80% (if the
land was meant for private enterprises) of the people living off the land (na-
mely not only landowners, but also «livelihood losers», that is people whose
livelihood depended on the land which was being acquired). Moreover the
Act fixed generous compensations for those who lost their land: four or two
times the market value for urban and rural land respectively. 179
The 2013 Land Act had been conceived by Rahul Gandhi and pilo-
ted through the parliamentary process by the then Minister of Rural De-
175. In fact it was issued on 29 December 2014.

176. R. Jagannathan, ‘Land Bill: Modi faces fight on two fronts: against Opp,
and against parivar’, First Post, 31 December 2014.
177. ‘The Right to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013, No. 30 of 2013’, The Gazette of India, 26
September 2013 (http://www.prsindia.org/uploads/media/Recent%20Acts/LARR%20
Act,%202013.pdf).
178. Government of India, Ministry Of Law and Justice, ‘The Land Acquisition
Act, 1894 (1 of 1894) (As modified up to the 1 September 1985)’ (http://dolr.nic.in/
hyperlink/acq.htm), Part II, 4 (1).
179. The Land Acquisition, Rehabilitation and Resettlement Bill, 2011 was in-
troduced in the Lok Sabha on 7 September 2011 and eventually passed on 29 August
2013. It was then approved by the Rajya Sabha on 4 September 2013. Finally, the bill
received the assent of the President of India, Pranab Mukherjee, on 27 September
2013 and was notified on 1 January 2014.
372
IndIa 2015
velopment, Jairam Ramesh. Interestingly enough, it had had the near

general support of the Opposition, starting from the BJP. As later remar-
ked by Rahul Gandhi, «In 2013, BJP had supported the new law. There
were two all-party meetings, three amendments the BJP had proposed and
which were incorporated, 15 hours of debate in Parliament, 65 MPs taking
part».180 Not only that, as again remembered by Rahul Gandhi, during the
parliamentary debate two eminent BJP politicians such as Rajnath Singh
and Vinay Katiyar had acted as the «opening batsmen» in favour of the law
in the Lok Sabha and Rajya Sabha respectively.181
The above does not detract from the fact that, as soon as the new law
was approved, strong objections were raised by many states, including se-
veral then ruled by Congress.182 Also, the then Power Minister, Jyotiraditya
Scindia, had called for an amendment exempting from the new law the
biggest power projects.183 Even more relevant was the fact that the business
community was vehemently against the new Act; so much so that, accor-
ding to a well known pro-Congress intellectual, it was this particular Act
which had been a main reason behind the business community’s massive
shift against the Congress party.184
This being the situation, the Modi government’s decision to emend
the 2013 Land Acquisition Act made sense and was in line with the pro-
business approach which characterised its policies – hence the decision to
introduce an ordinance emending the law, which was promulgated by the
President of India on 31 December 2014.
As briefly noted above, the ordinance exempted five categories of
land use from the provisions of the 2013 Land Act: defence; rural in-
frastructure; affordable housing; industrial corridors; and infrastructure
projects, including Public Private Partnership (PPP) projects where the
central government owned land. For these extremely vaguely defined are-
as, expropriation would not require the consent of the people living off
the land and the state was dispensed from performing the social impact
assessment.
The government tried to convert the ordinance into law185 by intro-
ducing in Parliament the Land Acquisition bill in February 2015. Howe-
ver, the bill, which was passed in the Lok Sabha in March, got stuck in the
180. Raj Saiya, ‘Congress will strongly oppose land ordinance in Parliament:
Jairam Ramesh’, First Post, 18 February 2015.
181. Ibid.
and against parivar’.
183. ‘Sonia Gandhi, Back in Charge of Congress’, NDTV, 19 March 2015.
184. Aditya Mukherjee, ‘Clear out the Congress Cabal’, India Today, 2 June
2014. See also Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihila-
tion of the Congress Party and the beginning of the Modi era’, p. 296.
185. As required by art. 123 of the Constitution.
373
Rajya Sabha, where the government did not have a majority.186 To this the
government responded by having the land ordinance issued – with some
minor variations as compared to the first version – a second and a third
time, in April and May.187
By mid-February, however, following the BJP Delhi debacle, the Con-
gress MPs, which had been «directionless for the first six months after the
Lok Sabha election [...] came into their own», as «they realised that the Modi
government was not invincible».188 Not only the Congress, under the lea-
dership of a «newly energised» Rahul Gandhi put up a fierce parliamentary
battle against the land acquisition legislation, but, led by Sonia Gandhi, took
to the streets, accusing the Modi government of being «anti-farmer and pro-
corporate».189 More importantly, all the main opposition parties, which had
hitherto acted each by itself, making life easy for the government, started
to act together, leaving the issues which divided them at the level of the
states.190
The opposition in the streets was organised not only by Congress, but
also by other parties (particularly the AAP) and, perhaps more importantly,
by several grassroots organisations. Even Anna Hazare, the leader of the
2013 anti-corruption movement, launched a march from Faridabad to Del-
hi, where it concluded with a two-day demonstration.191
Eventually, the Land Acquisition bill was referred to a joint parliamen-
tary committee, where the Opposition parties, following the suggestion of
the Congress general secretary, Digvijay Singh, insisted that a number of
RSS-affiliated peasant organizations be heard.192 This was done knowing
that, since the promulgation of the first land ordinance, the opposition to
the Modi government’s land legislation from «its own Sangh mischief-mon-
gers» had been evident.193 In fact, in spite of the behind curtains attempt by
Modi and Amit Shah to convince the Sangh Parivar peasant organizations
to close ranks and support the government’s land legislation, the Bharatiya
186. A second land bill was introduced at the Lok Sabha on 11 May 2015. ‘Land
acquisition Bill again moved in Lok Sabha’, The Hindu, 11 May 2015.
187. For a convenient summing up of the vicissitudes of the land ordinance
see Charu Kartikeya, ‘How the Modi government had to eat humble pie on the land
ordinance’, Catch News, 1 September 2015.
188. Anita Katyal, ‘NDA Report Card. One year after Modi majority, opposition
parties prove more energetic than anyone imagined’, Scroll.in, 14 May 2015.
189. Ibid.
190. Ibid.
191. ‘Be prepared to go to jail: Anna warns land ordinance protesters’, First
Post, 20 February 2015; ‘Hazare urges Modi to refrain from new ordinance on Land
bill’, The Hindu, 1 April 2015; ‘No room for politicians in Anna Hazare’s «padayatra’
against Land Acquisition Act’, The Hindu, 9 March 2015.
192. Anita Katyal, ‘Opposition sits back in glee as RSS affiliates list objections to
BJP’s land bill’, Scroll.in, 23 June 2015.
and against parivar’.
374
IndIa 2015
Mazdoor Sangh, the Bharatiya Kisan Sangh, the Swadeshi Jagran Manch,
and the Akhil Bharatiya Vanvasi Ashram made clear their continued oppo-
sition to the government’s Land Acquisition legislation.194
That was really the turning point in the struggle: the government –
which had been mulling over the idea of convening a joint session of Parlia-
ment, in case the land bill was not passed in the Upper House195 – decided
to cut its losses and call it a day. The change in strategy was made public
when, on 30 August, Narendra Modi announced during his radio program-
me Mann ki Baat his decision to let the third Land Acquisition ordinance
lapse.196
All this does not mean that the government’s attempt at modifying
the 2013 Land Act was over. The Land Acquisition Bill was still standing.
Moreover, both Arun Jaitley and Arvind Panagariya advised states to frame
their own acquisition laws, following the example of what had already done
by Tamil Nadu.197
Once all this has been said, the undisputable fact remains that the shel-
ving of the land ordinance was a major political defeat for the government
and a clear cut victory for the opposition at large, but more specifically for
Congress, which had led the attack on the government’s land legislation. It
was not without justification that Sonia Gandhi, at a rally in Patna, celebra-
ted «the victory of farmers over a government that has worked against the
interests of the farmers».198
3.2.2. The Lalit Modi and Shivraj Singh Chouhan affairs

In leading its parliamentary battle against the BJP, the Congress be-
came increasingly effective in highlighting and exploiting the BJP’s we-
aknesses. For example, in June 2015, an anonymous source leaked to the
British Sunday Times199 the content of some emails casting a shadow on
External Affairs Minister, Sushma Swaraj, and Rajasthan’s Chief Minister,
Vasundhara Raje. According to these emails, Swaraj and Raje had made
use of their influence with the British government to favour Lalit Modi, the
former Commissioner of India’s Premier (Cricket) League (IPL), who had
fled to Great Britain to avoid prosecution in India over charges of «financial
impropriety». Despite the fact that the Indian government had cancelled his
passport due to allegations of «monumental graft» in the allocation of bro-
194. Anita Katyal, ‘Opposition sits back in glee as RSS affiliates list objections
to BJP’s land bill’.
195. ‘Govt. strategy for Land Bill unclear’, The Hindu, 10 May 2015.
196. ‘Government to allow land ordinance to lapse: PM Modi’, The Hindu, 30
August 2015.
197. ‘Land Act «a bit draconian», frame own laws: Panagariya to states’, Business
Standard, 10 September 2015.
198. ‘Land ordinance gets a burial’.
199. ‘Howzat! Vaz name-drops to help tycoon’, The Sunday Times, 14 June 2015.
375
adcasting rights, first Vasundhara Raje had helped Lalit Modi to find a safe
haven in Great Britain by sponsoring his British immigration application in
2011 and then Sushma Swaraj had helped the former IPL chief to get Bri-
tish travel papers on «humanitarian» grounds.200 The Congress disrupted
the functioning of the Parliament repeatedly asking for Swaraj and Raje’s
resignation (to no avail).
A similar strategy was adopted by the Congress in relation to the
Vyapam scam involving Madhya Pradesh’s Chief Minister Shivraj Singh
Chouhan. The scam, which involved a widespread corruption network in
the state’s civil service appointment system, was made particularly distur-
bing by the fact that, over the last few years, as many as 50 witnesses and
defendants involved in the affair have died, 23 of them for «unnatural»
reasons.201
The effects of the Congress’s opposition against Modi’s government
were mixed. On the one hand, even if the Congress did not obtain any resi-
gnations, it certainly reinvigorated itself, at least in Parliament. Moreover, it
is undeniable that the continuous media exposure (also due to the Congress
strategy) seriously damaged the image of the BJP as the «clean» party that in
the 2014 election campaign had ridden the anti-corruption wave.202 Further-
more, the continuous disruption of legislative activity – leading to a virtual
policy paralysis203 – affected the image of the Modi government as a «doer».
On the other hand, however, probably just by chance, all the accused
in these scams – which reached the press thanks to internal leakages – were
Modi’s internal rivals.204 Therefore, although the BJP’s prestige was dama-
ged, thus indirectly weakening the Prime Minister himself, it is a fact that
the whole affair strengthened rather than undermined Modi’s position in-
side his own party.
3.3. Intolerance
The second source of problems for the Modi government came from
the heart of Narendra Modi’s social base, namely the galaxy of Hindu
200. ‘Six Questions Sushma Swaraj and Narendra Modi Need to Answer’, The
Wire, 15 June 2015; ‘All you should know about Lalit Modi, Sushma Swaraj, Raje
controversy’, Hindustan Times, 18 June 2015. According to Swaraj, Lalit Modi, then
without passport, needed to reach his wife, who was about to undergo a cancer oper-
ation in Portugal.
201. ‘All you need to know about the Vyapam scam that is killing people’, Busi-
ness Standard, 6 September 2015.
202. Pratap Bhanu Metha, ‘The drummer’s silence’, The Indian Express, 3 July
2015.
203. ‘Rajnath Singh shows willingness to end Parliament logjam – but will Modi
and Jaitley agree?’, The Indian Express, 29 July 2015.
204. Rana Ayyub, ‘With Vyapam, Another Modi Rival Lands in Crisis’, NDTV,
9 July 2015.
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IndIa 2015
groups that form the core of the BJP’s electoral support. The election of
Modi in May 2014 galvanised Hindu groups throughout the country.205 Sin-
ce then, the Prime Minister has proven to be unable (or unwilling) to control
the most extremist elements among them. To put it in different terms, Modi
has been unable to reconcile his institutional role as Prime Minister with
that of leader of a party that represents the interests and demands (also) of
Hindu zealots.
Two policy decisions taken at the state level by BJP governments (in
Maharashtra and Haryana) were particularly important in their consequen-
ces. Both states made it illegal to own or sell beef.206 We shall leave aside the
implications for personal freedom that these decisions entail. We will also
not discuss the fact that beef is widely consumed in India – 1 in 13 Indians
consume it, including 12.5 million Hindus207 – especially by the most nu-
tritionally deprived sections of society (Dalits and Tribals, for whom beef is
an important and cheap source of proteins)208 and by religious minorities
(Muslims and Christians).
Rather, we will focus on the fact that the bans contributed to crea-
ting an «anti-beef hysteria»209 that had major political consequences. On
28th September in Dadri (Uttar Pradesh) someone at the local temple an-
nounced that the family of Mohammad Akhlaq, a farm worker, had some
cow meat in their house. Shortly afterward a mob reached Akhlaq’s house,
killed him, and severely injured his son, Danish.210 The episode – perhaps
because Dadri is just 50 kilometres from New Delhi, from where journalists
could travel easily – immediately caught the attention of the national media.
Akhlaq’s murder became of national relevance for several other re-
asons. First, some of the people involved in the lynching were associated
with the BJP.211 Second, BJP local leaders, MPs and ministers made a num-
ber of outrageous declarations on the incident. MP Tarun Vijay suggested
that the victims should «maintain silence in the face of assaults».212 Culture
205. Diego Maiorano, ‘Early Trends and Prospects for Modi’s Prime Minister-
ship’.
206. ‘After Maharashtra, Beef Sale Banned in Haryana’, Outlook, 14 March
2015.
207. ‘Who are the beef eaters in India?’, Livemint, 20 October 2015.
208. ‘Memories of Meals Past: For the Dalits in Maharashtra, the ban snaps
their link to cheap protein’, The Indian Express, 5 April 2015.
209. ‘How Narendra Modi helped spread anti-beef hysteria’, Scroll.in, 6 Octo-
ber 2015.
210. ‘Dadri: Mob kills man, injures son over ‘rumours’ that they ate beef ’, The
Indian Express, 14 October 2015. An excellent account on the social context in which
the Dadri lynching took place is Ravish Kumar’s ‘A Sewing Machine, Murder, and
The Absence of Regret’, published on NDTV’s blog (http://www.ndtv.com/blog).
211. ‘Dadri lynching: Eight of 11 named in FIR, detained are relatives of
BJP worker’, The Indian Express, 5 October 2015.
212. Tweet by Tarun Vijay (@Tarunvijay) on 1 October 2015.
377
Minister Mahesh Sharma – who had raised a controversy a few days earlier
when he said that the former President of India A. P. J. Abdul Kalam was a
nationalist «despite being a Muslim»213 – called the lynching just an «incident»
that should not be given a «communal tone».214 An MP from Uttar Pradesh,
Yogi Adityanath – one of the main architects of the «Love Jihad» campaign
during 2014215– offered guns to the Hindus of Dadri to defend themselves
from retaliation.216 The list is by no means exhaustive.
Third, the Dadri lynching occurred in a climate of increasing religious
intolerance – at least at the level of perception.217 A number of disturbing
episodes happened during 2015 that reached the national media. In De-
cember 2014, Perumal Murugan, an acclaimed Tamil writer, was threatened
by Hindu groups that found a novel of his (written in 2010) insulting. The
police suggested him to go into exile, as they could not ensure his safe-
ty. Eventually, he withdrew his entire literary production and promised to
give up writing.218 In February 2015, Govind Pansare, a Communist Party of
India member, author of a biography of Shivaji and a sharp critic of right-
wing Hindu extremism, was killed.219 Former vice-chancellor of Kannada
University in Hampi, Malleshappa Madivalappa Kalburgi, a rationalist who
had spoken out against idolatry in Hinduism, suffered a similar fate in Au-
gust.220 In October, two concerts of the famous Pakistani singer Ghulam
Ali, scheduled in Mumbai and Pune, were cancelled because the Shiv Sena
(an ally of the BJP in Maharashtra) objected to Ghulam Ali’s nationality.221
213. ‘Culture Minister Mahesh Sharma speaks: Despite being a Muslim, APJ
Abdul Kalam was a nationalist’, The Indian Express, 18 September 2015.
214. ‘Dadri lynching: Mob murder an accident, arrested youths too will get jus-
tice, says Mahesh Sharma’, The Indian Express, 3 October 2015.
215. Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihilation
of the Congress Party and the beginning of the Modi era’, p. 283; Diego Maiorano,
‘Early Trends and Prospects for Modi’s Prime Ministership’, p. 81.
216. ‘BJP MP Adityanath’s outfit offers guns to Hindus in Dadri’, The Indian
Express, 7 October 2015.
217. It is obviously difficult to get hard evidence on whether India is becoming
more intolerant. By looking at the English media, one could get the impression that
this is indeed the case. However, it could well be that, for the reasons being discussed,
these episodes are just reported more frequently. The only bit of evidence available is
the figure for communal riots published by the Ministry of Home Affairs, according to
which, in 2015, by October, there have been 630 such incidents, as compared to 561
incidents during the same period in 2014. See ‘Communal Incidents In India Are On
The Rise, Shows Home Ministry Data’, The Huffington Post (India), 24 November 2015.
218. Sonia Faleiro, ‘India’s Attack on Free Speech’, The New York Times, 2 Octo-
ber 2015; Hari Kumar, ‘Pakistani Singer’s Concerts in India Are Canceled [sic] After
Shiv Sena Protests’, The New York Times, 8 October 2015.
219. ‘Who killed Govind Pansare?’, The Indian Express, 11 March 2015.
220. ‘MM Kalburgi killing: The Silencing of Reason?’, The Indian Express, 31
August 2015.
221. ‘Pakistani Singer’s Concerts in India Are Canceled [sic] After Shiv Sena
Protests’.
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IndIa 2015
Later in the same month, the Jammu and Kashmir MLA Engineer Rashid
was attacked with black ink in New Delhi because he had organised a «beef
party».222 Sudheendra Kulkarni, a former BJP member, suffered the same
fate a few days earlier, when he was attacked with ink by Shiv Sena activists
who did not want him to present the new book by the former Pakistan Fo-
reign Minister Khurshid Kasuri in Mumbai.223
All these (and other) episodes contributed to creating a fear that free-
dom of speech and religion were in danger. As many as 40 writers returned
their Sahitya Akademi awards in protest. Numerous filmmakers, scientists
and academics returned their awards too.224 This obviously kept the atten-
tion of the media focused on the issue, as did the fact that the RBI governor
Rajan and the rating agency Moody warned the government that rising
religious tensions could hurt its economic reform agenda.225
Fourth, the government badly mismanaged the situation from a public
relations perspective. The Prime Minister did not comment on the Dadri
lynching until 14 of October (more than two weeks after the episode) when
he called the incident «sad» and «not desirable», pointing out, however,
that the central government could not be blamed for it.226 Also, those BJP
members responsible for outrageous declarations were not punished in any
way. The Prime Minister did not comment on any of the other episodes
listed above.227
Modi’s silence is significant if only because it sheds light on the nature
of his relationship with the RSS. In short, the impression is that the Prime
Minister cannot afford to take a firm stance in defence of religious plurali-
sm, even if he wanted to.
Of course, it is far from certain that Modi’s silence is not an endor-
sement of the actions of Hindu extremists. His long career in the RSS, his
track record in Gujarat where he oversaw the killing of hundreds of Muslims,
and his more recent explicit attempts to polarise the electorate (both during
the last phase of the 2014 Lok Sabha elections and the 2015 Bihar polls),228
222. ‘Ink attack on Jammu and Kashmir MLA Rashid Engineer over beef par-
ty’, The Indian Express, 20 October 2015.
223. ‘Shiv Sena at it again, smears black ink on Sudheendra Kulkarni’s face to
protest Kasuri book launch’, FirstPost, 12 October 2015.
224. ‘How India’s writers are fighting intolerance’, BBC News, 13 October 2015.
225. ‘Warning signals’, The Indian Express, 2 November 2011; ‘Full text of Ra-
ghuram Rajan’s address at IIT Delhi: Tolerance is essential for economic progress’,
Scroll.in, 31 October 2015.
226. ‘Sad, not desirable, but what is Centre’s role: PM Modi on Dadri, Ghu-
lam Ali’, The Indian Express, 14 October 2015.
227. Pratap Bhanu Metha, ‘The drummer’s silence’, The Indian Express, 3 July
2015.
228. ‘How Narendra Modi helped spread anti-beef hysteria’; James Manor,
‘The Campaign and BJP «Missteps» Decide the Outcome: The Bihar State Election,
2015’.
379
are clear signs that Modi’s silence is at least a partial endorsement of the
Hindutva agenda.
The problem represented by Modi’s silences can be more accurately as-
sessed by reflecting on the fact that, although the Prime Minister could have
politically profited by taking a firm stand against religious extremism, he
chose not to do so because of even weightier political reasons. Indeed, spe-
aking firmly and without reservation against communal hatred would have
reinforced Modi’s image as a statesman, both domestically and internatio-
nally. This would have vindicated a great number of political commentators
in the international and Indian English media who, since May 2014, have
repeatedly argued that Modi, the Prime Minister, is a radically different per-
son from Modi the politician who, in Gujarat, turned a blind eye to the anti-
Muslim pogrom of 2002. Modi the Prime Minister, according to this view,
is a pragmatist who only cares about economic growth. Hence, according to
these interpretations, Modi would actually be disturbed and irritated by the
behaviour of his (extremist) followers, because they distract the party from
pursuing his economic agenda. Furthermore, Modi, by taking a firm stance
against religious intolerance, would have avoided offering the opposition
an excuse to block yet another parliamentary session on a golden plate229
and left him more space to push through his reform agenda.230
These benefits, however, appear to be too limited when compared to
the potential damages caused by a firm stand against religious extremism.
First of all, it is not clear to what extent the indignation over Modi’s beha-
viour exists beyond the English media. By looking at the CSDS data on the
most important electoral issues in the eyes of Bihar’s voters, one would be
inclined to conclude that the debate was largely confined to the English
speaking élite.231 Moreover, even the English speaking élite, although dis-
satisfied with Modi, still considered him the lesser of two evils. As pithily
stated by a quintessential member of this élite: «I am certainly disappointed
by Modi’s priorities, performance and style so far [...] but if the elections
were held today I would still vote for Modi. I myself and many others I know
well, and perhaps millions of Indians, are so fed up with the greed, avarice,
dishonesty and feudalism of the Congress/Gandhis that any alternative is
better than them.»232
229. ‘How Disruptions Hurt Parliament’s Upper House’, IndiaSpend, 11 De-

cember 2015.
230. This is what Modi’s admirers seem to be worried about. See, for example,
Tavleen Singh, ‘Dadri’s dire warning: If Modi fails to give India change, it’s because
of enemies within his house’, The Indian Express, 4 October 2015.
232. Personal communication to Michelguglielmo Torri, 29 December 2015. Its
author asked to remain anonymous.
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IndIa 2015
Summing up, there are reasons to think that the damage to Modi’s
image may be much more limited than what it would seem reading the
English media, even among the members of the English speaking middle
class. Which explains why Modi did not appear overly concerned about the
criticism. More importantly, the complexity of the relationship between the
Prime Minister and the RSS made it extremely difficult for him to take an
institutional stance in defence of religious pluralism.
The BJP and the RSS are in a symbiotic relationship. To oversimplify:
the former needs the latter’s workers to win support, particularly during
electoral campaigns; the latter needs the BJP’s presence in the state institu-
tions to put the country on the path leading from a secular state to a Hindu
Rashtra. However, as shown by what happened during Atal Bihari Vajpayee’s
prime ministership, when the BJP is in power this symbiotic relationship
runs the risk of being disrupted. However, since Modi’s 2014 victory, the go-
vernment and the RSS had found a division of roles that ensured a certain
equilibrium. On the one hand, the RSS were left a free hand to either direct
or oversee government and party affairs in the cultural and educational
spheres.233 On the other hand, the RSS did not interfere in other domains,
especially in the management of the economy. This being the situation, had
Modi taken a firm stance against religious intolerance, he would have expli-
citly violated this tacit pact.234
During 2015, however, a number of latent tensions between the Modi
and Shah duo, on the one hand, and the RSS, on the other, emerged. The
duo’s overly centralised management of the BJP had been a constant source
of concern for the leadership of the RSS. What had probably upset the RSS
leadership the most was Shah’s attempt to recruit 1.5 million new BJP mem-
bers independently from the RSS. According to Dhirendra K. Jha (an acute
observer of the RSS and the BJP) this would be the reason behind the RSS
cadres’ rather lukewarm support to the BJP during the 2015 electoral cam-
paign in Bihar.235 It may also be possible that the politically inappropriate
call for a review of the reservation system – an extremely obvious taboo in a
state like Bihar – made by Mohan Bhagwat, the RSS Sarsanghchalak (supre-
me leader), during the electoral campaign in that state, was not an accident.
233. Diego Maiorano, ‘Early Trends and Prospects for Modi’s Prime Minister-
ship’ and the numerous sources cited there.
234. Another sign that the RSS does not intend to leave Modi free to run his
own government was the summoning of the entire Council of Ministers by the RSS
in September 2015 to review their work during the previous 15 months. See ‘India’s
Prime Minister Should Be Careful About the Company He Keeps’, The Wire, 4 Sep-
tember 2015.
235. ‘RSS election machine grinds to a virtual halt in Bihar amidst tension with
BJP’, Scroll.in, 23 October 2015. Another reason (pointed out by Manor, ‘The Cam-
paign…’) could be that the RSS ‘imported’ 70,000 workers from outside the state to
help with the campaign, but these did not work Bihar well enough to be effective
campaigners.
381
Rather it may have been a not-so-covert attempt to undermine the Prime

Minister, or at least to send him a not-so-subtle message.236
To complicate things further, the RSS cannot afford to loose ground
vis-à-vis the growing number of increasingly assertive Hindu extremi-
st groups (within and outside the Sangh Parivar). The risk for the RSS is
to be «outflanked from the right by Hindutva outfits they can no longer
control».237 These groups can potentially attract the most radical elements
within the RSS family. Suhas Pashikar has written an informative essay on
one such outfit (the Sanatan Sanstha) that explicitly endorses violence as
a means of ensuring religious «justice» and which has been involved in
Govind Pansare’s assassination. 238 This and other militant groups of the
Hindutva galaxy are increasingly independent of the RSS, which is worried
about loosing even more ground if it shows any sign of «weakness». If only
for this reason, the leadership of the RSS cannot and will not tolerate any
criticism of the Hindutva agenda from «their» Prime Minister.
The challenge on the right involves political parties too. The Shiv Sena
in Maharashtra is a case in point. Probably with its mind on the Mumbai
municipal elections (to be held in 2017),239 the leadership of the party has
posed a direct challenge (from the right) to the BJP. When Modi «dared» to
call «unfortunate» the cancellation of Ghulam Ali’s concerts and the Dadri
lynching, Shiv Sena MLA Sanjay Raut replied that the Shiv Sena respected
Modi because of Godhra, and that what was «unfortunate» was Modi saying
that the Dadri lynching was «sad».240
What is at stake is one of the key elements of the BJP’s (and the RSS’s)
social base of support, which may be relatively small in numerical terms –
the overwhelming majority of Indian voters do not endorse the Hindutva
agenda – but it is extremely important in terms of political mobilisation.
4. Foreign Policy
As in the second half of 2014, in the year under review India’s foreign
policy had two main objectives: projecting India as a major power on the
world stage and getting all the possible foreign help it could in promoting
its own economic development. The pursuit of both objectives was often in-
236. It is significant that, just a few weeks later, Bhagwat made a complete
U-turn on the topic. See ‘Mohan Bhagwat takes u-turn, says RSS feels there’s no
question of scrapping quota’, Indian Express, 17 December 2015.
237. Hartosh Singh Bal, ‘Radical Shift’, The Caravan, 1 November 2015.
238. Suhas Pashikar, ‘Sanathan Sanstha, a Less Known But Potent Member of
the Hindutva Family’, The Wire, 28 September 2015. See also Vijaita Singh and Vikas
Pathak, ‘Understanding the Sanatan Sanstha’, The Hindu, 25 September 2015.
239. We thank Matteo Miavaldi for pointing this out to us.
240. ‘Modi is known for Godhra, unfortunate he condemned Dadri lynching:
Shiv Sena’, The Indian Express, 15 October 2015.
382
IndIa 2015
tertwined with, on the one hand, the shopping for state-of-the-art weapons
and weapon systems on the part of India and, on the other hand, with the sel-
ling or gifting of (maybe not so state-of-the art) weapons and weapon-systems
by India to countries which she wanted to bring inside her sphere of influen-
ce. As in the second half of the 2014, in the year under review an absolutely
dominant role in the making of India’s foreign policy was played by Narendra
Modi, with Foreign Affairs’ Minister, Sushma Swaraj, playing a distinctively
subordinate role. Indeed, in 2015 Modi confirmed to be the most peripatetic
among India’s Prime Ministers by making 27 trips abroad and officially visi-
ting 26 nations, which means an average of more than two foreign countries
visited each month.241 These official visits brought Modi not only to the US,
China, Japan and Russia – all countries which have traditionally been central
to India’s foreign policy strategies – but also to a host of other important and
less important nations, some of which had rarely or never been visited by an
Indian premier. Westward, Modi visited France, Germany, Ireland, and Cana-
da; southward, he visited most Indian Ocean island nations plus Singapore
and Malaysia; northward, he went to Mongolia, most Central Asian republics,
and Turkey; finally, among India’s closest neighbours, Modi visited Sri Lan-
ka, Bangladesh, Afghanistan, and Pakistan. Moreover Modi was present at
the Paris climate conference (30 November-11 December 2015), where India
played an important role in its successful conclusion242 and was able to have
some of its main objectives included in the final accord.243
In pursuing his two main objectives Modi’s main effort appears to have
been twofold. On one side it aimed at strengthening the political, military,
and economic connection with the US (attempting at the same time, with
some success, not to loosen India’s traditional ties with Russia)244 and, on
241. Yesha Kotak, ‘Complete list of countries visited by PM Narendra Modi in

2015’, DNA, 25 December 2015. The data quoted in the text differ from those in
Kotak’s article, as the latter was published on 25 December, namely the day of Modi’s
unexpected stopover in Pakistan, on his way back from Afghanistan.
242. On India’s role at the Paris climate conference see: ‘Paris climate talks
deadlocked, India is the Key’, The Hindu, 10 December 2015; ‘Why No Country Mat-
ters More Than India at the Paris Climate Talks’, Time, 11 December 2015; ‘India
talks tough as Paris climate summit enters final lap’, Hindustan Times, 12 December
2015; ‘Nations Approve Landmark Climate Accord in Paris’, The New York Times, 12
December 2015.
243. In the final accord the principle of «common but differentiated responsi-
bilities and respective capabilities» in pursuing the goal of reducing carbon emissions,
strongly sponsored by India, was included. See Chaitanya Kumar, ‘A brief guide to
India’s gains and losses at the Paris climate talks’, Quartz, 14 December 2015; Sujatha
Byravan & Sudhir Chella Rajanm, ‘At Paris, something for everyone’, The Hindu, 15
December 2015; Navroz K. Dubash, ‘A climate more congenial to India’, The Hindu,
16 December 2015 (the quotation is from this last article).
244. The continuing strength and importance of India-Russia relationship was
made apparent once again during the Indian Premier’s visit to Moscow (23-24 De-
cember 2015). Modi and Putin announced both the building of six nuclear blocks
383
the other side, it was focussed on the strategy of engaging/containing Chi-

na. Therefore, it is on the relationship with the US and that with China that
this year’s treatment of India’s foreign policy is mainly focussed. However
additional space will be dedicated to the analysis of India’s relations with
two of its closest neighbours: Nepal and Pakistan. Finally, some attention
will be given to analysing India’s role at the WTO (World Trade Organi-
zation) ministerial meeting of 15-19 December, held in Nairobi. This was
practically the only really important foreign event for India where Modi was
not present, the key role being played by Commerce and Industry Minister
of State (independent charge) Nirmala Sitharaman.
4.1. The India-US connection: high on hype, low on content

During the year under review the India-US relationship was high on
hype, but low on content. The hype was provided in particular by Modi’s
invitation to US President Barack Obama to be the «Chief Guest» to the
Republic Day parade on 26 January 2015. That was the first time ever that
a foreign head of state was invited to the Republic Day parade. Moreover,
this brought about an unprecedented second visit by a US President to India
during his term in office.245 Also, high on the first pages of the press – at
least the Indian press; in the American press it went almost unnoticed – was
Modi’s second visit to the US from 26-30 September 2015. 246 These two
high visibility visits were accompanied by a host of other visits either by
prominent members of the Obama administration to India or by eminent
members of the Indian government to the US.247
in India in the next 20 years, and the joint production of multi-task Kamov-226
helicopters, as part of the «Make in India» initiative (140 to be produced in India;
60 in Russia). Increased cooperation in the field of exploration and production of
hydrocarbons in Siberia was also in the cards. See ‘Russia and India cement ties with
energy and defence deals’, Reuters, 25 December 2015. Moreover, during Modi’s pas-
sage to Russia, India’s Reliance Defence signed a «manufacturing and maintenance
deal potentially worth $ 6 billion with Russia’s Almaz-Antey». This was part of a more
ambitious project aimed at developing ties with or assuming control of Russian arms
producing corporations. See ‘Reliance signs pact with Russian arms firm as Modi
visits Moscow’, Reuters, 24 December 2015.
245. Obama had already visited India in 2005.
246. ‘Despite excitement at home, Modi’s visit fails to make headlines in major
US newspapers’, Scroll.in, 25 September 2015. As noted by the author of the article,
this was in sharp contrast with the American press’ treatment of the almost contem-
porary visit by Pope Francis.
247. US Secretary of State John Kerry was the keynote speaker at the 2015
«Vibrant Gujarat» conclave on 11 January 2015; US Defence Secretary Ashton Carter
visited India four times, the most important visit being his three day stay on 2-4 June
2015; India’s Foreign Minister Sushma Swaraj and India’s Commerce Minister Nir-
mala Sitharaman visited the US at the end of September; India’s Defence Minister
Manohar Parrikar visited the US on 7-10 December.
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All these visits, but particularly the ones by Barack Obama to India and
Narendra Modi to the US, although «extraordinarily rich in political symbo-
lism», at the end of the day «failed to produce a substantive outcome».248
According to former Ambassador M. K. Bhadrakumar, this happened be-
cause «the sort of market access that the US is demanding and the high In-
dian expectations regarding American investments are unrealistic in a near
term.»249 However, US access to the Indian market and US investments in
India were not the only issues on the table. Two additional, interrelated and
crucial ones were Washington’s attempt to integrate India’s military with the
US forces deployed in the Asia-Pacific region and its contemporary effort –
really the other face of the same coin – to more firmly bring India inside the
American arc of containment around China.
As far as the opening of the Indian market to US capital is concerned,
there were two main problems to be solved. One was the definition of the
terms for operationalizing the 2008 civil nuclear cooperation agreement;
the second was the signing of a bilateral investment agreement between the
two countries.
The 2008 civil nuclear agreement had possibly been George W. Bush’s
major political success in the area of foreign relations. However, the agree-
ment had nevertheless failed with respect to the economic goal of opening
the Indian market to US nuclear firms, mainly because of the passing of the
Nuclear Liability Act by the Indian Parliament in 2010, which allowed both
the victims and the operators of a nuclear plant involved in a disaster to sue
the suppliers «for tortuous and criminal liability»,250 effectively deterring
the US nuclear companies from entering the Indian market.251 Already du-
ring his 2014 trip to the US, Modi had signalled his intention to modify the
US-India nuclear agreement in such a way as to accommodate the needs
of the American nuclear firms.252 Although news circulated253 that the two
parties were willing to compromise, it remains the fact that, as noted by the
former Ambassador M. K. Bhadrakumar, «there [was] no clarity whether
the understanding [concerning India’s nuclear liability law] reached at the
governmental level (details of which haven’t been divulged) would stand
248. This judgement was given by former Ambassador M.K. Bhadrakumar with
reference to Obama’s visit. See his ‘Obama’s India visit a big blank’, Asia Times, 30
June 2015. However, the same judgement can be extended to Modi’s September visit
to the US.
249. Ibid.
250. Rohan Tigadi, ‘Critical Analysis of the Indian Civil Nuclear Liability Act,
2010’, Social Science Research Network, 16 May 2012
(http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2254490), p. 8.
the Congress Party and the beginning of the Modi era’, p. 304.
252. Ibid., p. 313 and fn. 277.
253. ‘India, US move forward with major breakthrough in N-deal’, The Times of
India, 25 January 2015.
385
scrutiny in a court of law or even prompt the American companies to shed

their inhibitions over the Indian law (which, they say, does not conform to
the international covenants on liability in nuclear commerce)».254
Indeed, the lack of clarity highlighted by Bhadrakumar still persisted
at the end of the period under review. During the same period, no indica-
tion has emerged of a newly found willingness on the part of US nuclear
firms to enter the Indian market.
As far as the bilateral investment treaty between the US and India is
concerned, this had been under negotiation for years. This negotiation,
stalled in February 2014, was restarted on January 2015, when visiting US
secretary of state John Kerry, taking part in the «Vibrant Gujarat» concla-
ve, made a strong case for it.255 The American position on the bilateral
investment treaty was that it, by facilitating protection of intellectual pro-
perty rights, would encourage US companies to invest in India.256 Howe-
ver, any speedy progress in the negotiation was impeded by uncertainties
on the Indian part. Indeed, at the beginning of 2015 India was reviewing
its existing bilateral investment model agreement, on which 83 Bilateral
Investment Promotion and Protection Agreements (BIPPAs) with several fo-
reign countries had been based since 1994. The problem was that, in the
previous two years only, the pre-existing bilateral investment model agree-
ment had paved the way to no less than 17 arbitration proceedings initiated
by international companies against the Indian government.257 This being
the situation, the Ministry of Commerce proposed scrapping the BIPPAs
altogether; the ministries of Finance and of Foreign Affairs, however, pro-
posed modifying the existing model by modifying the investor-State dispute
settlement in such a way as to prevent foreign companies from taking the
Indian government to international arbitration unless all legal and admini-
strative remedies in India had been exhausted.
Both the above solutions were bound to be opposed by the US go-
vernment and investors, which, not without reason, considered the Indian
judicial system slow and inefficient. US investors in particular appeared
concerned regarding the question of intellectual property rights, which they
saw as being routinely infringed upon by India, in spite of India’s claim that
its regime was in line with the WTO’s Trade-Related Aspects of Intellectual
Property Rights.258
In due course the Indian government finalized a new bilateral treaty
model framework, deciding in favour of the Ministry of Finance-sponsored
254. M. K. Bhadrakumar, ‘Obama’s India visit a big blank’.

255. ‘India, US agree to restart talks on bilateral investment treaty’, The Times of
256. Ibid.
257. Rajrishi Singhal, ‘The biggest investment deal between India and the US
is nowhere close to completion’, Quartz, 24 January 2015.
258. Ibid.
386
IndIa 2015
solution. This brought forward several US objections to the Indian posi-

tion.259 As a consequence, at the end of the year under review, «the long
pending bilateral investment treaty between India and the US [appeared]
nowhere on the horizon».260
As far as the high Indian expectations regarding American investments
are concerned, Modi’s main attempt at increasing them was made during
his second visit to the US in late September. Modi, after a stopover at the
UN headquarters in New York, spent most of his time on American soil
meeting 47 among the US’s main Chief Executive Officers (CEOs), some
of whom – as in the cases of Google, Microsoft, and Adobe – were of Indian
origin.261 As during his previous visit to the States one year earlier, Modi
declared that «India was open for business». Also «he listened to the Ame-
ricans carefully, and seemed to take [their] complaints on board without
defensiveness». For their parts, the American CEOs «praised the [Indian]
prime minister’s efforts but highlighted a host of obstacles».262 However, at
that point in time it had already become clear that the mood was not that of
the previous year and the enthusiasm for Modi had somewhat cooled down.
In the period between Modi’s two American trips, the US CEOs and po-
liticians had expected the Indian Prime Minister to translate his first
announcement about India being «open for business» into «doing the
business».263 This was something that had not happened, at least not at the
speed with which foreign investors had expected Modi to proceed. Indeed,
the changed attitude of the American business community and politicians
had already become apparent on the eve of Modi’s second arrival in the
States. During the US-India CEO Forum held in Washington on 21 Sep-
tember 2015, US Secretary of Commerce Penny Pritzker had remarked that
the World Bank ranked India 186 out of 189 countries on the ease of en-
forcing contracts. «In fact – Pritzker had stated – it can take years to resolve
a contractual dispute with a vendor in India, and terms are too frequently
reinterpreted after a deal has closed. These challenges make it incredibly
costly and unpredictable to do business in India, and only serve to impede
the operations and investments of Indian and foreign firms alike.»264 For his
259. For a summing up of the US objections to the Indian position see Jayanta
Roy Chowdhury, ‘Modi set for US, sans key treaty’, The Telegraph, 21 September 2015.
260. Alyssa Ayres, ‘PM Modi in US, take two’, The Indian Express, 25 September
2015.
261. Ibid.; Seema Sirohi, ‘In corporate America, public enthusiasm but private
disappointment about Modi’, Scroll.in, 27 September 2015.
262. All quotations are taken from Seema Sirohi, ‘In corporate America, public
enthusiasm but private disappointment about Modi’.
263. Ibid. See also ‘Governance reform is No 1 priority: Modi to top American
CEOs’, Asia Times, 25 September 2015.
264. U.S. Department of Commerce, U.S. Secretary of Commerce Penny Pritzker
Addresses U.S.-India Commercial and Economic Relationship at Carnegie Endowment for In-
ternational Peace, 21 September 2015.
387
part, during the same event, Honeywell CEO David Cote, while declaring
that he was «pretty bullish» on India’s efforts to cut red tape, decried the
Indian bureaucracy as «stultifying».265
Summing up, the impression is inescapable that the US business com-
munity had concluded that Narendra Modi, although willing to accommo-
date their needs, was not up at doing that, at least in the near future. Ac-
cordingly, in spite of the rise in US direct investment in India – noted in a
previous section – this remained well below India’s expectations and the US
business community’s potentialities.266
During the year under review, Washington’s doubts about India’s ability
to fully integrate into the US-dominated neoliberal economic space became
evident in relation to India’s «unambiguous interest in joining APEC»267,
namely the Asia-Pacific Economic Cooperation forum, which includes 21
Pacific rim nations and was founded in 1989 to promote free trade in the
region. Indeed, joining the APEC forum was seen by both New Delhi and
Washington as a necessary stepping-stone to India joining the Trans-Pacific
Partnership treaty. The January 2015 US-India Joint Strategic Vision for the
Asia Pacific and Indian Ocean Region had welcomed India’s interest in joi-
ning the Asia Pacific Economic Cooperation forum, noting that «the Indian
economy is a dynamic part of the Asian economy.»268 But in the following
months the matter rested there, without any new developments.269 Signifi-
cantly, in the joint press conference following the Modi-Obama New York
meeting of 28 September 2015, India’s Prime Minister’s statement that he
looked «forward to work with the US for India’s membership of the Asia
Pacific Economic Community» was not reciprocated by the US President.270
As far as the US attempt to closely integrate the Indian military with
its own military forces in the Asia-Pacific sector is concerned, this depended
upon the finalization of some contentious pacts, in particular the Logistic
Support Agreement (LSA), the Communication Interoperability and Secu-
rity Memorandum Agreement (CISMOA), and the Basic Exchange and Co-
operation Agreement for Geo-Spatial Cooperation (BECA).
265. Tom Risen, ‘India’s Modi Seeks More Investment From U.S. Tech Sector’,
U.S. News, 21 September 2015.
266. In fact, in some cases US entrepreneurs did cut their connections with In-
dia. The case of commodities trading guru Jim Rogers of Rogers Holding, who exited
from the Indian market to invest in Chinese shares, is emblematic. See ‘Investor Jim
Rogers takes too hard a view on India’, Asia Times, 3 September 2015.
267. Alyssa Ayres, ‘Where’s India On The Trans-Pacific Partnership’’, Forbes, 6
October 2015.
268. The White House, Office of the Press Secretary, U.S.-India Joint Strategic
Vision for the Asia-Pacific and Indian Ocean Region, 25 January 2015.
269. Alyssa Ayres, ‘What’s New in the U.S.-India Strategic and Commercial Dia-
logue’, Council of Foreign Relations – Asia Unbound, 23 September 2015.
270. Alyssa Ayres, ‘Where’s India On The Trans-Pacific Partnership’.
388
IndIa 2015
The LSA envisaged reciprocal logistical support on barter or an equal

value exchange basis, whereas the CISMOA and BECA would enable the
US to transfer high-tech avionics and electronics to India. However, in spi-
te of their seeming advantages for India, these pacts, when they had first
been discussed during the UPA’s time in office, had eventually been ste-
adfastly opposed by the then Defence Minister, A. K. Antony, who had come
to the conclusion that they limited India’s full control of its own military
forces, and gave the US unfettered access to India’s military installations
and to sensitive data, including India’s encrypted systems.271 With the co-
ming to power of the BJP government, the negotiations had been restarted
and the US had pressured India to accept the pacts, which were described
as «foundational» in the development of the military ties between the two
countries.272
Although at the beginning of June 2015 a new 10-year US-India de-
fence framework was signed in New Delhi, renewing the previous one, sig-
ned during the first UPA government in 2005,273 the more specific military
pacts still remained up in the air. A new and more intense phase in the
negotiations concerning the LSA started at the end of year under review,
during Defence Minister Manohar Parrikar’s visit to the USA (7-10 Decem-
ber 2015), whose «open mind» on signing the pact was appreciated by the
US negotiators.274 However, at the end of the period under review, the fina-
lization of the LSA had not yet been reached.275
While unable to finalize the LSA, CISMOA and BECA, the US had con-
siderably more success in more firmly inserting India into their own arc of
containment around China. In fact, during Obama’s January trip to India,
the two countries signed a joint document officially setting out their com-
mon vision for the Asia-Pacific and Indian Ocean region. This document,
which re-stated their common position on the topic, which had already been
arrived at during the September 2014 Modi’s visit to the United States, was
most notable for reasserting Washington’s anti-Chinese position on «safe-
guarding maritime security and ensuring freedom of navigation and over
271. ‘Ahead of Barack Obama visit, US and India revive talks on controversial
military pacts’, The Times of India, 24 January 2015. Wasantha Rupasinghe, ‘India in
talks to open ports, bases to US military’, World Socialist Web Site, 16 January 2016.
272. ‘US pushes India to ink contentious defence pacts’, The Times of India, 27
February 2015.
273. The renewal of the 10-year defence pact had already been announced dur-
ing President Obama’s visit in January. However, its formal signature occurred during
US Defence Secretary Ashton Carter’s visit (2-4 June 2015). See K. Ratnayke, ‘US
defence secretary boosts military ties with India’, World Socialist Web Site, 5 June 2015.
274. Sushant Singh, ‘Manohar Parrikar’s US visit: traversing the distance from
symbolism to substance’, The Indian Express, 17 December 2015.
275. Wasantha Rupasinghe, ‘India in talks to open ports, bases to US military’.
389
flight throughout the [Asia-Pacific and Indian Ocean] region, especially in the
South China Sea».276
The joint document was seen by some commentators as prefiguring the
«eventual amalgamation of India’s Act East Policy and US’s Asia pivot»,277 as
adumbrating a closer integration of India’s foreign policy in the Asia-Pacific
region within the US’s anti-China arc of containment policy. However, at
first, New Delhi seemed both bent on distancing itself from what it unof-
ficially termed a «strategic misinterpretation» of its foreign policy goals,278
and concerned about the consequences of openly espousing the US anti-
Chinese arc of containment policy.
On the other hand, the US appeared determined to push India exactly
in that direction. This was mainly done by pressuring New Delhi to integra-
te Japan in the Malabar naval exercises.279
The annual «Exercise Malabar», from a very modest beginning in
1992, off the coast of Goa, had gradually progressed «to become a high
point of Indo-US defence cooperation at the operational level [...] with high
strategic significance».280 In 2007 «Exercise Malabar» was held twice, the
first time off the coast of Japan, the second time in the Bay of Bengal, and
expanded from a bilateral to a multilateral exercise, with Japan taking part
in the first session and Australia and Singapore joining India, the US, and
Japan in the second session. The 2007 expansion of «Exercise Malabar» was
part of a strategic quadrilateral dialogue involving Washington, New Delhi,
Tokyo, and Canberra and clearly aimed at containing China. Indeed Bei-
jing responded to it by issuing formal diplomatic protests, which induced
both India and Australia to pull out of the quadrilateral dialogue, «citing
political and economic reasons respectively».281 For its part, the Malabar
Exercise continued as a merely bilateral India-US military drill.
However, US Defence Secretary Ashton Carter, during his visit to New
Delhi on 2-4 June 2015, had both «singled out “India’s Act East policy”
as a strategy that the US supported» and stressed that «the US “pivot” or
“rebalance” to Asia complemented India’s Act East Policy».282 Also, high
on Carter’s agenda was the goal of convincing India to once again include
Japan in the Malabar exercise. This was an attempt that, after the official
276. The White House, Office of the Press Secretary, U.S.-India Joint Strategic
Vision for the Asia-Pacific and Indian Ocean Region (emphasis added).
277. ‘Nuclear deal among five key takeaways from Obama visit’, The Times of
278. M. K. Bhadrakumar, ‘Obama’s India visit a big blank’.
279. K. Ratnayake, ‘US defence secretary boosts military ties with India’, World
Socialist Web Site, 5 June 2015.
280. Suresh Bangara, ‘Why America, India and Japan are Playing War Games
at Sea’, The Quint, 14 October 2015. The author had been Commander-in-Chief,
Southern Naval Command, of the Indian Navy.
281. Ibid.
282. K. Ratnayake, ‘US defence secretary boosts military ties with India’.
390
IndIa 2015
disbanding of the quadrilateral dialogue, had been made during the UPA
government’s tenure to no avail.
Indeed, according to an anonymous «top defence ministry official»,
even this time India was unlikely a change its position.283 However, in the
end, India’s Foreign Minister Sushma Swaraj met in New York with her US
and Japanese counterparts in September, inaugurating a «trilateral mini-
sterial dialogue».284 Soon after the news became official that the annual
Malabar exercise would henceforth include Japan.285 As a consequence, in
October, a Japanese destroyer joined US and Indian ships in the Malabar
exercise in the Bay of Bengal.286 Although Japanese participation could ap-
pear limited, from a strictly military standpoint it was «operationally and
strategically significant», as claimed by a former Commander-in-Chief of
the Indian navy’s Southern Naval Command.287 But, of course, the real im-
portance of Japan’s participation was political: the fact that the Malabar
exercise had once again been upgraded to include both the US and Ja-
pan clearly signalled that India had jettisoning its original shyness about
being seen as openly taking part in the US sponsored anti-China arc of
containment.
4.2. The India-China relationship: economic engagement

and political containment
4.2.1. Engaging China
All the above brings us to India’s China policy. As during the first six
months of Modi’s government, during 2015 it continued to have two apparen-
tly contradictory aspects: economic engagement and political containment.
The first aspect was apparent during Modi’s visit to China (14-16 May
2015); the second was visible during the whole year in India’s proactive
policy in the Indian Ocean, in East and Central Asia and in the Pacific.
Indeed, the bulk of India’s initiatives in the above areas appeared to have
New Delhi’s need to build its own arc of containment around China as a
common subtext.
283. ‘Japan on Agenda as US Defence Secretary Ashton Carter Meets Union

Minister Manohar Parrikar Today’, NDTV, 3 June 2015.
284. ‘US, India, Japan Hold First Trilateral Ministerial Dialogue, Call for Free-
dom of Navigation’, NDTV, 30 September 2015. See also Prashanth Parameswaran,
‘Why the «new» US Trilateral Dialogue With Japan and India Matters’, The Diplomat,
1 October 2015. In fact a trilateral US-India-Japan dialogue had already been in
progress, but only at the assistant secretary level.
285. Wasantha Rupasinghe, ‘India in talks to open ports, bases to US military’.
Unofficially the news had already circulated at the end of June. See ‘Exercise Mala-
bar: Japan Navy to join India, US in Bay of Bengal’, The Indian Express, 30 June 2015.
286. ‘Eye on China in Malabar war games’, The Telegraph, 13 October 2015.
287. Suresh Bangara, ‘Why America, India and Japan are Playing War Games
at Sea’.
391
Modi’s May 2015 visit to China aimed at procuring both Chinese in-
vestment in support of India’s economy and Chinese help in realising his
«make in India» pet project. The visit was not without results, as «24 agre-
ements for cooperation in education, science, and economic development,
including railways, aerospace, mining and tourism, said to be worth over $
10 billion» were signed.288 Moreover, 21 business-to-business deals worth
US$ 22 billion were also signed. Many of the deals entailed Chinese banks’
financial support to Indian firms and, in some cases, to joint India-China
ventures (for example in the field of steel production).289 This, in a way,
nicely dovetailed with the fact that India and China were already acting in
partnership in a number of important international initiatives, such as the
BRICS Development Bank and the Asia Infrastructure Investment Bank
(AIIB).290 However, as noted by M. K. Bhadrakumar, at a closer look many
of the above agreements were «in the nature of MOUs», namely memoran-
da of understanding, which, although «good for the optics», might not get
implemented.291 Also, a host of problems that are making the relationship
between the two Asia giants difficult were left either unaddressed or unre-
solved.
From a political standpoint, the main problem remained the question
of the disputed borders and the uncertainty itself of the LAC (Line of Ac-
tual Control), namely the provisional India-Pakistan border, in much of its
course. This was such a complicated problem that it could be highlighted
– as Modi did during a speech given at the prestigious Tsinghua University,
in Beijing292 – but not solved during a tree-day visit, even though it was well
prepared in advance.
More significant for judging the status of the relationship between the
two countries was a series of economic questions. First of all, work on the in-
dustrial parks that China should have set up in India, as agreed during Chi-
na’s President Xi Jinping September 2014 visit to India, had not yet taken
off. Also, during Modi’s visit China’s distinct lack of interest in the «make
in India» project was evident. On the other hand, no offer on China’s part
to involve India in the «New Silk Road» project was made.293 However, the
main and more urgent problem that remained unresolved was the question
of the growing imbalance vis-à-vis India of the growing China-India trade.
288. Deepal Jayasekera & Keith Jones, ‘India’s Modi woos and Warns China’,
World Socialist Web Site, 21 May 2015.
289. Ibid. See also: Bill Savadove, ‘India’s Modi brings home $ 22 billion in
China deals’, Yahoo News, 16 May 2015; Harsh V. Pant, ‘Modi’s refreshingly novel
outreach to Beijing’, The Japan Times, 20 May 2015.
290. Deepal Jayasekera & Keith Jones, ‘India’s Modi woos and Warns China’.
291. M. K. Bhadrakumar, ‘India tries to forge a new relationship with China’,
Asia Times, 18 May 2015.
292. ‘Read full text: PM Modi’s speech at Tsinghua University, Beijing’, The
Times of India, 15 May 2015.
293. M. K. Bhadrakumar, ‘India tries to forge a new relationship with China’.
392
IndIa 2015
India-China trade, which has been growing steadily from as little as

US$ 2.92 billion in 2000 to US$ 70.25 billion in 2014, making China India’s
largest trading partner in goods, is highly imbalanced in favour of China.
India’s trade deficit increased from US$ 18.65 billion in 2009 to US$ 36.88
billion in 2013 and then skyrocketed to US$ 46.29 billion in 2014.294 This
was not such a surprising development, given the nature of India-China
trade: while China exports high value goods, such as telecommunications
equipment, computer hardware, industrial machinery and other manufac-
tured goods, India sends back mostly raw materials such as cotton yarn,
copper, petroleum products, and iron ore.295
In his Tsinghua University speech Modi hinted at his dissatisfaction
with the existing Sino-Indian trade partnership by pointing out that: «to
maintain this partnership over the long run, we must also improve the ac-
cess of Indian industry to the Chinese market». To this, Modi hastened to
add: «I am encouraged by President Xi’s and Premier Li’s commitment to
resolve this problem».296
Unfortunately, in spite of Modi’s exhibited optimism, no sustained po-
licy on China’s part, aimed at solving this problem, appears to have taken
shape, at least during the period under review.
4.2.2. Containing China

The second aspect of Modi’s China policy – containing China – can be
seen not only as the other face of the policy of engaging China, but, more
generally, as an expression of India’s strategic surge aimed at reclaiming the
position of great power and a main player in an area extending from the
western side of the Indian Ocean to the Pacific and including the whole of
South Asia. This strategic surge was given expression in a series of official
visits by the Indian Prime Minister to the states of the area, with the accom-
panying signing of bilateral agreements, and a series of bilateral naval exer-
cises, involving the Indian navy and the navies of other countries. Also, this
strategic surge was also expressed, on both the political and theoretical level,
294. All the data on bilateral trade and trade deficit are based on Indian Em-
bassy, Beijing, ‘India-China Bilateral Relations - Economic and Trade
Relations’, without date; accessed on 31 December 2015 (the data for 2014 are
provisional). See also: Press Information Bureau, Government of India, Ministry of
Commerce & Industry, Trade between India and China, 13 August 2014. According to
data reported by The Hindu, related to the comparison between the financial years
2013-14 and 2014-15, the negative trend was further increasing. See ‘India-China
trade deficit swells 34% to $48 billion’, The Hindu, 13 May 2015.
295. Anant Vijay Kala, Raymond Zhong & Niharika Mandhana, ‘Gaps That
Define the India-China Relationship, in Charts and Maps’, The Wall Street Journal, 13
May 2015. Press Information Bureau, Government of India, Ministry of Commerce &
Industry, Trade between India and China, 13 August 2014.
296. ‘Read full text: PM Modi’s speech at Tsinghua University, Beijing’.
393
at an international conference, where India announced the launching of a

«Cotton Route» policy, in clear competition with China’s «Silk Road» policy.
In March, that is, before his visit to China, Modi embarked on a five-
day tour to three Indian Ocean island states: Seychelles, Mauritius, and Sri
Lanka (10-14 March 2015). In all three cases, India offered military aid
and opened lines of credit with the explicit aim to counter China’s growing
influence in the Indian Ocean.297
This was followed by a three-day international conference (18-20 March
2015) held at Bhubaneswar (Odisha). The conference, entitled «India and
the Indian Ocean: Renewing the Maritime Trade and Civilisational Lin-
kages», was conceived as the official launching of a «Cotton Route» policy,
aimed at reviving the pre-colonial connections between India and a series
of Asian and African countries. The conference included a close-door ses-
sion and saw the participation of no less than four Indian ministers, among
whom the Foreign Affairs Minister, Sushma Swaraj, plus India’s National
Security Adviser, Ajit Doval, and several foreign ambassadors («at least a
dozen»). 298 According to Indian government sources, the idea on which the
conference was based was «to balance China’s growing maritime ambitions,
especially its security interests and projects that have adverse implications
for India’s defence.»299
Part of the «Cotton Route» policy can be considered Modi’s visit to
Dhaka (6-7 June 2015). Although the contentious issue of the sharing of
the waters of the Teesta River could not be solved, a series of important
agreements were concluded. These included, among others, the long-due
rationalization of the common borders, Bangladesh’s engagement to cre-
ate an India-reserved special economic zone in the hinterland of the port
city of Mongla, and the opening to Indian cargo vessels of the Chittagong
and Mongla ports. Particularly the opening of the Chittagong port to
Indian traffic was bound to irk China, as the port had been developed
thanks to China’s help, as part of Beijing’s «string of pearls» policy.300
297. Sachin Parashar, ‘Govt’s Indian Ocean gambit gathers pace’, The Times of
India, 18 February 2016; Sanjeev Miglani, ‘Modi to ramp up help for Indian Ocean
nations to counter China’, Reuters, 4 March 2015; Wasantha Rupasinghe, ‘Modi visit-
ing Indian Ocean islands in bid to undermine China’s influence’, World Socialist Web
Site, 10 March 2016; Deepal Jayasekera, ‘Modi bears strategic «gifts» to Seychelles and
Mauritius’, World Socialist Web Site, 14 March 2016; Wasantha Rupasinghe, ‘Modi visits
Sri Lanka to push for closer ties against China’, World Socialist Web Site, 18 March 2016.
298. ‘Indian Ocean conference will discuss strategic challenges’, The Hindu, 16
March 2015; ‘To counter China’s Silk Road, India is working on Cotton Route’, The
Economic Times, 23 March 2015. See also Andrew Korybko, ‘What Could India’s «Cot-
ton Route» Look Like?’, Sputnik News, 29 March 2015.
299. Dipanjan Roy Chaudhury, ‘India plans cotton, ancient maritime routes to
counter China’s ambitions’, The Economic Times, 17 April 2015.
300. ‘Now, India gets to tug at China’s «string of pearls»’, The Times of India, 7
June 2015.
394
IndIa 2015
Also, while in Dhaka, Modi announced a US$ 2 billion line of credit to

Bangladesh, to be used to finance infrastructure, power, health, and edu-
cation projects.301
In July 2015, news circulated that the Indian navy was aiming at having
200 warships operational by 2027, up from 137.302 This was followed by the
first-ever joint maritime exercise held off the East coast of India on 11-19
September 2015 by the Indian Navy and the Royal Australian Navy.303 Fi-
nally a «strategic partnership» declaration between India and Singapore was
signed on 24 November 2015, during Modi’s visit and was accompanied by
the inking of 10 bilateral pacts in the fields of defence, cyber security and
civil aviation.304
Also part of the «Cotton Route» strategy (although India’s eastward
pre-colonial sea routes only went as far as China but did not reached the
Pacific Ocean) can be considered the second Forum for India-Pacific Islands
Cooperation (FIPIC), held in Jaipur (Rajasthan) on 21 August 2015. The
first FIPIC had been held in November 2014, in Suva, Fiji, when Modi had
visited that small island nation. In Jaipur, Modi, speaking to the represen-
tatives of 14 Pacific nations, offered the establishment of an FIPIC trade
office in Delhi and promised to fund solar power infrastructures and to
help in setting up early warning and response systems for extreme weather
events.305
Summing up, India’s policy aimed at containing China can be seen as
an expression of India’s strategic surge in South Asia and in the Indian and
Pacific Oceans. Among the nations which were drawn in the net weaved by
Narendra Modi’s hectic foreign tours in the above mentioned geographical
areas, some – Bangladesh, Sri Lanka and Fiji (where half of the population
is of Indian origin) – had traditionally been a privileged object of India’s
foreign policy. However, in the case of the others, the visit of an Indian
Prime Minister had been a novelty, as it had been a novelty that India was
supplying military and economic aid to these nations.
301. Ibid. See also: Deepal Jayasekera, ‘Indian prime minister visits Bangladesh
to strengthen ties against China’, World Socialist Web Site, 12 June 2015; Sudha Ram-
achandran, ‘Modi bridges gaps between India, Bangladesh’, Asia Times, 12 June 2015.
302. Zachary Keck, ‘Watch Out, China: India’s Navy Wants 200 Warships’, The
National Interest, 15 July 2015.
303. ‘India-Australia naval exercise - «AUSINDEX 15»’, Daytodaygk, 12 Septem-
ber 2015 (http://www.daytodaygk.com/india-australia-naval-exercise-ausindex-15).
See also: ‘Australia, India to Hold First Ever Naval Exercise Amid China Concerns’,
The Diplomat, 1 September 2015.
304. ‘India, Singapore sign joint declaration on «strategic partnership»’, Busi-
ness Line, 24 November 2015.
305. John Braddock, ‘India reaches into South Pacific to counter China’, World
Socialist Web Site, 27 August 2015. The Pacific island nations taking part in the 2nd
FIPC were Fiji, Cook Islands, Kiribati, Marshall Islands, Micronesia, Nauru, Niue,
Palau, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu.
395
4.3. India’s difficulties in its own neighbourhood

In spite of Modi’s foreign policy activism and his attempt to project In-
dia as a major world power and define the Indian Ocean-South Asia-Pacific
Ocean as an Indian sphere of influence, the fact remains that India either
failed to develop more harmonious relations with some of its closest nei-
ghbours or contributed to making them more difficult. The former is the
case of Pakistan, the latter that of Nepal. Significantly, in both cases, the
shadow of China appears in the background. We shall dwell first on Nepal
and then on Pakistan.306
4.3.1. The India-Nepal crisis

Nepal had been one of the first countries to be visited by Narendra
Modi, soon after his election, in August 2014. At the time, the relations
between New Delhi and Kathmandu seemed to have reached an all-time
high, as Modi’s commitment to massively invest in the Himalayan country
arrived after the crucial role played by India in mediating the end of the
long civil war which had bloodied Nepal from 1996 to 2006. Furthermore,
when Nepal was hit by two devastating earthquakes in April and May 2015,
India was ready to succour its small neighbour.
However, the relations between the two countries suddenly nosedived
following the promulgation of the Nepal’s new constitution on 20 Septem-
ber 2015, which established the country as a secular federal republic orga-
nized in seven states.307 India publicly not only expressed its dissatisfaction
with the contents of Nepal’s constitution308 but, while officially denying
doing that, immediately imposed a de facto blockade on the movement of
first necessity goods to the Himalayan country.309
306. An additional, although less relevant, case, showing India’s difficulties with
neighbouring countries, is that of the Maldives. See Parul Chandra, ‘While Modi jets
from Fiji to Mongolia, India is loosing influence in its own backyard’, Scroll.in, 31
August 2015; ‘Maldives foreign land ownership reform bill is approved’, BBC News,
23 July 2015.
307. In reality, the India-Nepal relations had started to cool down after the con-
stituent assembly elections in 2008, when India’s continuing direct political engage-
ment in Nepal started to be seen as unnecessary and aimed «to secure its own interests
over hydropower energy, development projects, business, and trade». Hemant Ojha,
‘The India-Nepal Crisis’, The Diplomat, 27 November 2015.
308. Sanjoy Majumder, ‘Why India is concerned about Nepal’s constitution’,
BBC News, 22 September 2015.
309. ‘Nepal Summons Indian Envoy as Hundreds of Cargo Trucks are Halted at
Border’, The Wire, 26 September 2015. Up to the end of the year under review, New
Delhi went on claiming to have no responsibility in the blockade. The reason that
impeded the normal flux of goods to Nepal – New Delhi falsely claimed – was the
continuing unrest on the Nepali side of the border. See ‘A controlled Indian blockade
on Nepal (BBC Report), available in United We Blog!, 10 December 2015.
396
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According to India, the new constitution restricted the political rights

of the inhabitants of the Madhes or Terai region, namely the plains borde-
ring with India, where some 40% of the Nepali population lived310. India
claimed that this was bound to produce a backlash, which could become
violent and even spill beyond the border, because the inhabitants of the sou-
thern Nepali plains were closely related to the inhabitants of the Indian sta-
te of Bihar. Also, and rather funnily – considering the totally different posi-
tion consistently taken by the BJP in the case of Sonia Gandhi, whose Italian
origin had been an unending source of polemics and personal and political
attacks – India objected to the fact that, according to the new constitution,
only citizens by descent, and not citizens by birth or by naturalization, were
entitled to occupy the top political, judicial and security positions, such as
president of the Republic, Prime Minister, head of the judiciary and head of
the police. Equally funny was the request that foreign women married to a
Nepali citizen should automatically acquire the Nepali citizenship.311 More
concretely, India’s real political objective seems to have been the creation
of two Madhes provincial states, which would run 800 kilometres along the
southern border, being only 20-30 kilometres wide. By many, this move was
seen as potentially endangering Nepal’s territorial integrity.312
Although this is not the place to discuss the democratic features of
Nepal’s constitution, in order to put the Indian government’s claims and
behaviour in perspective, some points need to be highlighted.313 The first
is that some of the Nepal’s constitution key aspects favourably compare
with the Indian Constitution. The Nepali constitution abolishes the death
penalty;314 explicitly abolishes any discrimination based not only on «ori-
gin, religion, race, caste, tribe», but also on « sex, physical condition, con-
dition of health, marital status, pregnancy, economic condition, language
or region, ideology or on similar other grounds»;315 establishes «that wo-
men members constitute at least one third of the total number of members
elected to the Federal Parliament» by any given party; 316 or, in case a party
is unable to do that, enjoins the party to «so elect that women members
constitute at least one third of the total number of members elected to
310. Sanjoy Majumder, ‘Why India is concerned about Nepal’s constitution’.

311. Again Sonia Gandhi’s case is telling. Sonia Gandhi had not acquired the
Indian citizenship by marrying Rajiv Gandhi. She had acquired it by applying for it.
In spite of this, her right to be considered an Indian citizen had constantly been put
in doubt by the BJP and other Indian political parties. For India’s objections to the
Nepali constitution see Shubhajit Roy, ‘Make seven changes to your Constitution:
India tells Nepal’, The Indian Express, 24 September 2015.
312. Hemant Ojha, ‘The India-Nepal Crisis’.
313. The Constitution of Nepal (http://www.nepalembassy-germany.com/pdfs/Con-
stitution__full_english.pdf).
314. Ibid., p. 13 (Part-3, 16, 2).
315. Ibid., p. 15 (Part-2, 18, 2).
316. Ibid., p. 58 (Part-8, 84, 8).
397
the State Assembly from that party».317 Also, the constitution establishes
a National Women Commission, with extensive powers, among which is
that of monitoring «as to whether laws concerning the rights and interests
of the women and obligations under the international treaties to which
Nepal is a party have been implemented».318 The Nepali Constitution
also grants extensive rights to the Dalits, among which «free education
with scholarship, from primary to higher education».319 Last but not least,
the Nepali Constitution introduces a mixed electoral system, according
to which a part of the representatives in the two houses of Parliament
are elected according to the first-past-the-post method and the remaining
part according to the proportional method.320 In other words, in contrast
to the Indian electoral system, the Nepali one, while assuring governabi-
lity through the first-past-the-post system, allows a closer correspondence
between the popular vote and the number of representatives elected in
Parliament, thanks to the proportional method.321 This, by itself, goes a
long way towards preventing the danger – so evident in the first-past-the-
post system – that the minorities go unrepresented.
It should also be stressed that the Nepali constitution was approved
by the 601-members Constituent Assembly on 17 September 2015 by an
overwhelming majority. In fact, 507 members voted for it; 25 members,
representing the pro-Hindu and pro-monarchist Rastriya Prajatantra Party
Nepal, voted against it; finally, most of the absent members, belonging to
small parties representing the ethnic minorities residing in the southern
plain, boycotted the vote.322 This does not mean that all or even the majo-
rity of the representatives of the Terai/Madhes region boycotted the vote, as
317. Ibid., p. 115 (Part-14, 176, 9). According to the Constitution, Nepal is di-
vided in seven states.
318. Ibid., p. 174 (Part-27, 253, 1, b).
319. Ibid., p. 26 (Part-3, 40, 2).
320. More precisely, the Federal Parliament is composed of two houses: the
House of Representatives and the National Assembly. The former is composed of
165 members elected according a fist-past-the-post system and 110 members elected
through a proportional system, «with the whole country being considered as a single
election constituency». Ibid. p. 59 (Part-8, 84, 1 a & b). The National Assembly is com-
posed of 56 members elected «by an electoral college composed of members of the
State Assembly, chairpersons and vice-chairpersons of the Village Bodies, and May-
ors and Deputy-Mayors of the Municipalities, with different weightage of vote», plus
three members nominated by the President. Ibid., p. 63 (Part-8, 86, 1, a). For their
part, 60% of the members of the state assemblies are elected through a first-past-the-
post system and the remainder through a proportional system. Ibid., p. (Part-14, 176,
1, a & b).
321. The distortions brought about by the first-past-the-post system, particular-
ly in plural societies as India and Nepal, are well known. As an example, it suffices to
remember India’s 2014 general elections, when the BJP, with only 31% of the popular
vote, was able to secure the absolute majority of the Lok Sabha seats.
322. ‘Nepal passes new secular constitution amid protests for Hindu nation’,
DNA, 17 September 2015.
398
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the majority of them had been elected in the national parties and, therefore,
voted for the constitution.323
Contemporaneously to the opposition put up in the Constituent Assem-
bly, the small Madhesi parties launched a series of violent demonstrations,
which, already by 18 September, resulted in some 40 deaths, half of which were
members of Nepal’s police and Armed Police Force.324 This agitation conti-
nued to be carried out in the following months, resulting in further deaths.325
Two aspects of the anti-constitution agitation must be stressed. The
first is that, in spite of what was claimed by much of the Indian press, it was
carried out only by a part of the Terai population, which did not include the
Dalits and landless people.326 The second is that the suspicion is legitimate
that Indian agents acting as provocateurs helped to organize the agitation
itself, as the death of an Indian national and the arrest of several others
seem to confirm.327
The blockade – for which, contrary to all evidence, the Indian go-
vernment continued to deny any responsibility – resulted in «severe and
chronic shortage of fuel, essential commodities and medicines».328 The
situation became so bad that, in a statement issued on 30 November 2015,
UNICEF denounced the risk of death or disease for more of 3 million
children under the age of 5 due to a severe shortage of fuel, food, medici-
nes and vaccines. This situation was due to the fact that, as diplomatically
stated in the UNICEF’s press release, «In the past 10 weeks, vital imports
of essential commodities have been severely restricted at Nepal’s southern
border due to unrest over the country’s new constitution.»329
All this translated in a rapid increase in anti-Indian sentiments in the
Himalayan country.330 For its part, the Nepal government, while trying to
323. Hemant Ojha, ‘The India-Nepal Crisis’. The same point is also made by
Professor S. D. Muni, although with the caveat that the Madhesi belonging to the na-
tional parties who had voted for the constitution had done so «under the pressure of
their political bosses». S. D. Muni, ‘India’s Nepal Policy Needs Caution, Not Grand-
standing’, The Wire, 23 September 2015.
324. Hari Phuyal, ‘Nepal’s New Constitution: 65 Years in the Making’, The Dip-
lomat, 18 September 2015.
325. Prashant Jha, ‘Nepal crisis deepens as Madhes movement marks 100 days’,
Hindustan Times, 23 November 2015. Of course, most Indian newspapers portrayed
the Madhes movement as a heroic democratic and progressive struggle against a
clique holding power in Kathmandu.
326. Hemant Ojha, ‘The India-Nepal Crisis’.
327. M. K. Bhadrakumar, ‘Lyndon Johnson, India’s Modi and a cow named
Bessie’, Asia Times, 3 November 2015.
328. ‘Don’t interfere in our internal affairs: Nepal PM warns India’, Asia Times,
2 November 2015. See also Vijith Samarasinghe, ‘Nepal turns to China for fuel to
counter Indian blockade’, World Socialist Web Site, 2 November 2015.
329. UNICEF, Press release – Nepal: serious shortage of essential supplies thre-
atens millions of children this winter.
330. As noted by Professor S.D. Muni: «A huge new constituency of India haters
399
appease India, opened negotiations with China, from which it received

some essential fuel supplies.331 But geography stood against any possibili-
ty that, at least for the time being, this counterstrategy could be effective.
While Nepal appears sandwiched between the two Asian giants, the truth
is that the lines of communication with India are easier and shorter than
those with China,332 which really makes Nepal an «India-locked» country.333
This means that supplies from China were slowed down and made overly
expensive by geography.
However, by the end of the year, the fact started to become apparent
that New Delhi had overplayed its hand. The Modi government had been
right in assessing that the major powers, including the US, while not ne-
cessarily being enthusiastic about India’s behaviour vis-à-vis Nepal, would
leave a free hand to New Delhi.334 The problem was that, on the domestic
front, the open opposition to the Nepal policy of some intellectual circles
was joined by the silent, but much more redoubtable opposition of two other
groups. One was the business community trading with Nepal; the other was
the RSS. The latter had always been in sympathy with what had hitherto
been the only Hindu state in the world and, accordingly, hostile to the new
secular constitution. However, the fact that India’s intervention was justi-
fied with the need to defend both Nepal’s democracy and the rights of the
Madhes people and Nepali women disturbed the RSS, as a distraction from
the real objective, namely supporting the political forces opposing secula-
rism in Nepal.335
By the end of the year, there were timid signs that Modi’s government
was searching for some face-saving formula to break the impasse which it
had so powerfully contributed to creating.336
has been created in Nepal as a consequence of Modi’s coercive diplomacy». S. D. Muni,

‘India and Nepal Must Step Back from the Precipice’, The Wire, 8 November 2015.
331. Vijit Samarasinghe, ‘Nepals turn to China for fuel to counter Indian block-
ade’.
332. Nepal declines southward from the Himalayan mountain ridges to the
Gangetic Plain. The way to China is made difficult by the presence of the Himalayas,
and Kathmandu is much nearer to Delhi and the Indian and Bangladeshi ports than
to Beijing and the Chinese ports.
333. The first to point out that Nepal was rather an India-locked than a land-
locked country was Professor Leo E. Rose, in his Nepal. Strategy for survival, Berkeley:
Berkeley University Press, 1971. One of the authors of the present chapter, Michel-
guglielmo Torri, heard Professor Rose making use of that definition, while attending
one of Rose’s courses at the University of California, Berkeley, in the academic year
1974-75.
334. S. D. Muni, ‘India and Nepal Must Step Back from the Precipice’.
335. C. K. Lal, ‘Indian Diplomacy is Being Tested by Nepal’s Realities Once
Again’, The Wire, 26 December 2015.
336. Ibid.; Arushi Gupta, ‘Nepal Crisis: Will India lose its neighbor?’, South
Asian Voices, 22 December 2015; ‘Crisis deepens, Nepal gets in touch with Indian
envoy’, The Indian Express, 25 December 2015; ‘India hopes «difficult days» will not
affect Indo-Nepal ties’, The Indian Express, 26 December 2015.
400
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At the time of writing, the India-Nepal crisis is still on-going, which

makes it impossible to arrive at a final assessment of it. However, two tentati-
ve points can be made, the first related to the causes of the crisis, the second
to its consequences.
When one goes beyond the rather funny and scarcely convincing claims
that the Modi government’s intervention was motivated by its love for de-
mocracy and preoccupation with the political rights of the Madhesi minori-
ties and the gender rights of the Nepali women, the suspicion is legitimate
that such an intervention was triggered by the conviction that the Nepali
government and constituent assembly, by not heeding New Delhi’s wishes,
were taking too independent a stand. Clearly Modi and his government
considered Nepal as a sort of protectorate, a conviction which was widely –
even if (most of the times) unconsciously – shared by the bulk of the Indian
commentators and public opinion. This motivated the Indian government’s
arrogant and brutal behaviour, rightly compared to that of Lord Curzon of
colonial lore vis-à-vis the Indian princely states and Tibet.
Concerning the consequences of the crisis, it is clear that not only anti-
Indian sentiments in Nepal had reached an all-time high, but that the local
political class was bound to try to countervail India by building closer ties
with China. Of course, in the year under review, recourse to this strategy was
drastically limited by the scarcity, length, and difficulty of the land routes
connecting Nepal to China. However, the situation was bound to dramati-
cally change in the near future because of the expansion of the railway and
all-weather highway connections between the two countries, triggered by
the India-Nepal crisis itself.337
4.3.2. The India-Pakistan relationship

Since the beginning of his mandate Modi had put Pakistan in front of
the choice between either accepting New Delhi’s own guidelines concerning
the modalities of the relationship between the two countries or being isola-
ted and put under pressure.338 In other words, New Delhi’s Pakistan policy
was not so different from its Nepal policy; the problem was that Pakistan was
not only a more powerful country than tiny Nepal, but also a country which,
in contrast to Nepal, had an extremely favourable geopolitical position. Not
surprisingly, by the early months of 2015 indications started to abound that
Modi’s Pakistan policy was badly failing.
The attempt to isolate Pakistan from the US could proceed only up to
a point. Although the relationship between Islamabad and Washington was
337. ‘Qinghai-Tibet railway to reach Nepal in 2020’, China Daily, 7 April 2015;
‘Nepal-China agree to enhance bilateral trade’, The Himalayan Times, 6 November
2015; ‘More The Merrier’, República, 4 January 2016.
338. Michelguglielmo Torri &Diego Maiorano, ‘India 2014: the annihilation of
401
not particularly warm, Washington’s decision to maintain an important mili-

tary presence in Afghanistan until 2018 made the safeguarding of tolerably
good relations with Islamabad imperative.339
On a different front, after having been traditionally difficult, Russo-
Pakistan relations started to suddenly flourish. The turning point was the
end of Russia’s embargo on arm sales to Pakistan and the inking, in No-
vember 2014, of a «milestone» military cooperation agreement between
the two countries.340 In mid-April 2015, this was followed by Moscow’s
decision to invest US$ 2 billion in the building of a 1,100-kilometres pipe-
line for the transport of liquefied natural gas from the port city of Karachi
to Lahore.341
The Russia-Pakistan deal, however, was soon dwarfed by the almost con-
temporaneous launching (20 April 2015) of a $46 billion Chinese project, the
China-Pakistan Economic Corridor (CPEC). The CPEC – a set of railways, all-
weather highways, and pipelines, aiming at connecting Pakistan’s southern
Gwadar port on the Arabian Sea to China’s western Xinjiang region – was
an integral and radically important part of the Chinese new «Silk Road».342
The Corridor aimed at providing China with a safer new route to the Middle
Eastern gas and oil fields and the European markets than the sea route going
through the Malacca Straits. The CPEC also had the potential to easily be
extended to Iran, making possible a China-Pakistan-Iran variation of the
Iran-Pakistan-India (IPI) pipeline. After having been on the anvil for more
than 20 years, the IPI had not been able to take off, because of American
opposition and Indian second thoughts.343
This being the situation, on 10 July 2015, rather unexpectedly, Naren-
dra Modi and his Pakistani counterpart, Nawaz Sharif, met «for nearly an
hour» on the sidelines of the Shanghai Cooperation Organization summit
in Ufa (Russia) and decided to restart the negotiation process between the
two countries, putting together «a clear road map of events» to take the dia-
logue process forward.344 However, the envisaged dialogue process got de-
railed even before it started. In fact, its initial step – the meeting in August
of the Indian and Pakistani National Security Advisors in New Delhi – was
339. Gabriel Domínguez, ‘Why Pakistan will remain a key US ally (interview to
Omar Hamid)’, Deutsche Welle, 14 January 2015; Talat Masood, ‘The current dynamic
of US-Pakistan relations’, The Express Tribune, 20 October 2015.
the Congress Party and the beginning of the Modi era’, p. 315, fn. 90.
341. Sudha Ramachandran, ‘Russo-Pakistan relations are riding high’, Asia
Times, 24 April 2015.
342. ‘China and Pakistan launch economic corridor plan worth $46 billion’,
Reuters, 20 April 2015. See also Shannon Tiezzi, ‘The China-Pakistan Economic Cor-
ridor Gets Even More Ambitious’, The Diplomat, 13 August 2015.
343. Sualiha Nazar, ‘Why Iran Needs to Explore Participation in the China-Pa-
kistan Economic Corridor’, The Diplomat, October 14, 2015.
344. ‘The Ufa takeaways and reason for hope’, The Hindu, 11 July 2015.
402
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abruptly cancelled on 21 August 2015 by the Indian Foreign Affairs Ministry,

on the very eve of the meeting itself.
Although the political preparations for the meeting had been badly ma-
naged by both countries,345 the key reason for the negotiations being derailed
was India’s continuing attempt to unilaterally impose its own modalities and
(newly drawn) red lines on the negotiations between the two countries.346
On 30 September 2015, Pakistan Prime Minister Nawaz Sharif tried to
re-launch the negotiations by proposing, in front of the UN General Assem-
bly, that Pakistan and India normalized relations by formalizing the 2003
ceasefire line and agreeing to an expansion of the UN Military Observer
Group to monitor a new ceasefire. Sharif ’s proposal was responded to by In-
dia’s Foreign Affair Ministry spokesperson Vikas Swarup, tweeting that: «To
demilitarize Kashmir is not the answer. To de-terrorize Pakistan is».347 This
was followed by India’s decision, in October, «to take an aggressive position
on Balochistan», highlighting the «atrocities» by Pakistani forces both there
and in «Pakistan occupied Kashmir».348
In this inauspicious contest there was a new coup de theatre, namely the
meeting of the Pakistani and Indian National Security Advisors in Bangkok
on 6 December 2015.349 The meeting itself – which had been prepared in
the most absolute and unbroken secrecy – was the result of a «path-breaking
167-second long talks in Paris», between Modi and Sharif, held on 30 No-
vember 2015, on the sideline of the climate summit.350
345. Mahmud Durrani, ‘Time to move from posturing to dialogue’, The Hindu,
1 September 2015.
346. As in 2014, the meeting was cancelled because India objected to the Paki-
stan Embassy long-time habit to consult with representatives of the Hurriyat political
front. See Michelguglielmo Torri & Diego Maiorano, ‘India 2014: the annihilation
of the Congress Party and the beginning of the Modi era’, pp. 307-308; Siddharth
Varadarajan, ‘Modi Erred Once in Making Hurriyat the Issue. He Should Not do So
Again’, The Wire, 19 August 2015; Rana Banerji, ‘As Pakistan Plays Hurriyat Card,
Modi is Caught in a Bind of His Own Making’, The Wire, 21 August 2015.
347. ‘India rebuts Kashmir initiative from Pakistan’s Sharif ’, Deutsche Welle, 1 Oc-
tober 2015; Shivam Vij, ‘India looks bad rebuffing Pakistan peace overture’, Deutsche
Welle, 1 October 2015.
348. ‘After PoK, India turns focus on Balochistan’, The Hindu, 8 October 2015; ‘Se-
curity concerns trump diplomacy’, The Hindu, 9 October 2015. In fact India had a long
story of meddling in Baluchistan, which had finally been highlighted by an investigation
on an alleged terrorist group by British authorities in 2015. See Owen Bennet-Jones,
‘Pakistan’s MQM «received Indian funding»’, BBC News, 24 June 2015. Of course, In-
dia’s meddling in Baluchistan was reciprocated by Pakistan’s meddling in Kashmir. See,
e.g., ‘Pakistan supported, trained terror groups: Pervez Musharraf ’, Asia Times, 28 Octo-
ber 2015. Anyway, India’s decision to highlight Pakistan’s «atrocities» in Baluchistan was
both new and rash, given India’s own abysmal record in the Kashmir Valley.
349. ‘India, Pakistan NSAs meet in Bangkok’, The Hindu, 6 December 2015.
350. M. K. Bhadrakumar, ‘Modi scores a hat-trick on Pakistan’, Indian Punchline,
8 December 2015. The claim that the meeting lasted 167 seconds only is Bhadraku-
mar’s and is unsupported by other sources. See, e.g., ‘Nawaz, Modi meet on sidelines
403
From Bangkok onward, the stalled dialogue process appeared to proceed

at full speed. On 8 December India’s External Affairs Minister Sushma Swaraj
travelled to Islamabad where she held talks with her Pakistan counterpart Sar-
taj Aziz. At the and of them, at a joint press conference, Swaraj made public
the two country’s decision to launch a «Comprehensive Bilateral Dialogue».351
A fortnight later, this was capped by the «surprise move» by Modi, who, on his
way back to New Delhi from Kabul – where he had visited the new Parliament
building, gifted by India – made an «unscheduled stopover» in Lahore (25
December), to meet Nawaz Sharif on his birthday.352 It was a typical vintage
Modi move, a highly symbolic personal meeting aimed at highlighting that a
new phase in the India-Pakistan relationship had begun.
Summing up, during 2015 Modi’s policy vis-à-vis Pakistan, in spite of
a false start, had turned on its head: as late as June 2015, while in Bangla-
desh, Modi had publicly attacked Pakistan for «constantly» troubling India
by promoting terrorism;353 some six months later he had celebrated Paki-
stan Prime Minister’s birthday in the latter’s family home near Lahore.354
More importantly, by accepting the re-launch of a «comprehensive dialo-
gue», Modi had de facto abandoned his attempt, pursued from the start of
his prime ministership up until August 2015 and beyond, to impose his own
preconditions on the dialogue with Pakistan.
The fact remains that the history of the difficult Pakistan-India rela-
tionship, particularly in the last few decades, is such as to make anybody
sceptical about the fact that any sudden positive turn can really last over
time. Both in Pakistan and India there are powerful interests which mili-
tate against any real and long-lasting detente between the two countries.
Accordingly, it comes as no surprise that, in the past decades, any positive
diplomatic steps aimed at pushing forward meaningful negotiations betwe-
en Islamabad and New Delhi have inevitably been marred by the increase in
incidents along the border and, sometimes, by terrorist attacks.
4.4. India at the Nairobi World Trade Organisation meeting

On 27 November 2014, the WTO’s General Council had set 31 Decem-
ber 2015 as the final deadline for arriving at a permanent solution to the
of Paris climate summit’, Dawn, 30 November 2015; ‘In Paris, a brief climate-change
moment’, The Indian Express, 1 December 2015. However, the Modi-Nawaz meeting
must have been brief indeed.
351. Swaraj said: «We have decided to restart the Comprehensive Bilateral Dia-
logue. The dialogue that was earlier known as Composite Dialogue and later on known as
Resumed Dialogue will now be known as the Comprehensive Bilateral Dialogue». ‘7 years
after Mumbai attacks, India, Pakistan resume dialogue’, The Hindu, 10 December 2015.
352. ‘Narendra Modi rewriting diplomatic lexicon’, Livemint, 28 December
2015.
353. ‘In Bangladesh, PM Modi accuses Pakistan of promoting terrorism’, Hin-
dustan Times, 8 June 2015.
354. ‘Narendra Modi rewriting diplomatic lexicon’.
404
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controversial problem of stockholding of food crops, maintained by deve-

loping countries for security reasons. Public stockholding of food crops was
opposed by the developed countries, which claimed that it distorted market
prices. For their part, less developed countries, led by India, had strongly de-
fended their right to stockholding, pointing out that it was crucial to protect
the poorer strata of their own population against the danger of scarcity or
famine. Thanks to the spirited fight led by India, first at the WTO ministerial
conference held in Bali in December 2013, and then in a series of secretive
dealings with the US during the second half of 2014, the WTO had provisio-
nally accepted the right of developing and least developed countries to hold
public stockholding of food crops beyond the limits officially established by
the WTO itself. This right had been sanctioned by a «peace clause», namely
an agreement that, while standing, would suspend any legal challenge to the
food subsidy policy of any WTO country. At Bali the expiry date of the «peace
clause» had been set at 2017; later on (13 November 2014), the US and In-
dia had announced that they had agreed on the fact that the «peace clause»
would have an indefinite timeframe. A few days later, on 27 November 2014,
the WTO’s General Council «unequivocally» agreed to the indefinite «peace
clause», fixing however – as noted above – 31 December 2015 as the deadline
to solve the food stockholding problem.355
This being the situation, the tenth ministerial WTO meeting, schedu-
led to be held in Nairobi on 15-18 December 2015, was bound to be the
place where the whole question of food stockholding and the «peace clause»
would be solved. Moreover, some further questions were on the anvil. One
was the Special Safeguarding Mechanism (SSM), which developing and le-
ast developed countries wanted in order to temporarily raise tariffs in case
of surging imports and related price falls. Another problem was the cutting
of «trade distorting» subsidies on agricultural and allied activities, requested
by developed countries. A crucial part of this problem was the question of
subsidies for cotton. Last but not least, there was the question of the con-
tinuation/discontinuation of the Doha Development Agenda (DDA). The
DDA, launched in 2001 at the fourth WTO ministerial conference, aimed
at making trade rules more favourable to developing countries. After 14
years without any substantial results, the developed countries (plus Brazil)
wanted the DDA to be abandoned, a proposal which was strongly resisted
by developing and least developed countries. The Indian delegation, led
by Commerce and Industry Minister Nirmala Sitharaman , played an im-
portant role in building and leading a united front that included both most
developing countries (the exception being Brazil) and the least developed
countries.356
356. ‘India toughen stand at WTO after safeguards proposal blocked’, Livemint,
30 November 2015; ‘Firm on agri issues while aiming for permanent solution at WTO:
405
Reaching a consensus on all these problems proved difficult enough

to force a one-day-extension of the conference to 19 December.357 The fi-
nal ministerial declaration, while not an unqualified success for India, was
nevertheless far from being a failure. Concerning the food stockholding
question, the decision was taken to continue the discussion of the problem
in the Committee on Agriculture, to be convened in special session. This
actually meant that the 31 December 2015 deadline had been cancelled, de
facto leaving India free to continue with its existing food stockholding policy.
Regarding the SSM, the developing countries’ right to it was recognised; at
the same time the final ministerial declaration stated that this issue was to
be defined and reviewed later on. The question of farm subsidies was left
open, but the decision to end farm export subsidies was taken. However,
while developed countries were asked to start cutting subsidies immediately,
the other countries, including India, were allowed to start doing so as late
as the end of 2018. A major reverse for India was related to cotton exports:
the ministerial declaration established duty-free and quota-free access to the
developed countries market for cotton produce, but only for the least deve-
loped countries, excluding from this benefit developing countries, such as
India. Finally, on the DDA, the final declaration reaffirmed a full commit-
ment to its fulfilment, although noting that some member-nations disagreed
about this. However, as WTO’s procedures require the unanimous support of
all member-countries for any new resolution, the declaration amounted to a
reaffirmation of the validity of the DDA.358
In India – possibly favoured by a tweet by Nirmala Sitharaman, saying:
«Utterly disappointed! A unanimous reaffirmation of DDA hasn’t happe-
ned» – the opposition and most civil society groups portrayed the results of
the Nairobi conference as an utter disaster, a «dismal failure» and «nothing,
but surrender».359 But it is difficult to see how – given the compact opposi-
tion of all the developed countries, led by the US and supported by Brazil
– India could have got more.
Sitharaman’, Business Standard, 8 December 2015; ‘Battle lines drawn as WTO meet be-
gins in Nairobi’, Business Standard, 12 December 2015; ‘WTO talks explained: What’s at
stake for Indian agriculture’, Scroll.in, 15 December 2015; ‘Agricultural safeguards sac-
rosanct to India: Sitharaman tells WTO’, Business Standard, 16 December 2015; ‘Little
convergence on export competition: Sitharaman’, Business Standard, 17 December 2015.
357. ‘WTO talks enter overtime as consensus on agri issues elusive’, Business
Standard, 19 December 2015.
358. Unfortunately, the authors have been unable to locate the text of the Nai-
robi declaration. What is said about its contents comes from: ‘WTO meeting: It’s back
to square one’, Business Standard, 19 December 2015; ‘Cold comfort in Nairobi’, Busi-
ness Standard, 20 December 2015; ‘India says only some concerns addressed at WTO
meet in Nairobi’, Business Standard, 21 December 2015.
359. Kudan Pandey, ‘Modi government surrenders at WTO meeting in Nairobi:
experts», Down to Earth, 21 December 2015.
406
sri lanka 2015: the downing oF a new era?
Danila Berloffa
Asia Maior - An Italian think tank on Asia

dberloffa@tiscali.it
At the beginning of the year under review, the Opposition common candidate, Mai-
thripala Sirisena, emerged as the winner of the January presidential election. The
new Presidency brought with it the promise of a new political phase, characterised by
the restoration of both democratic institutions and the rule of law, seriously eroded
during the previous ten year long Rajapaksa’s presidencies. However, the shift of
power at the presidential level was not immediately accompanied by an analogous
shift in the Parliament, which at first precluded the possibility of a wide-ranging
change of policies. Nevertheless, the Sirisena administration was able to tackle at
least some of the most compelling issues affecting the country, in particular by limit-
ing the extensive powers attributed to the Presidency by Rajapaksa in 2010. Despite
this and other unquestionably positive political developments, other critical matters
– among which the heavy militarization of the Northern region, the maintenance of
the draconian Prevention of Terrorism Act and some restrictions on media freedom –
were left unsolved.
In foreign policy, the shift was substantial, resulting in the cooling down of relations
with Beijing and in a new closeness between Colombo and both New Delhi and, par-
ticularly, Washington. This realignment involved on the one hand the interruption
of numerous Chinese funded infrastructural projects in Sri Lanka, and, on the other
hand, a dramatic shift in the United Nations Human Right Council (UNHRC)
attitude towards Sri Lanka. The UNHRC had previously issued three resolutions,
sponsored by Washington, harshly criticizing the war crimes occurred in Sri Lanka
during the long and gory 1986-2009 civil war. However, in October 2015, a new
UNHRC issued resolution on the same topic saw the involvement of Sri Lanka in
its drafting, which, not surprisingly, took into account the Sirisena administration
demands and needs.
From an economic standpoint, the year under review opened on a rather bleak situa-
tion, to which the government reacted by promoting an expansive policy. Although not
devoid of positive results, this policy brought about a surge in the debt and a worsen-
ing of the balance of payments. After the parliamentary election held in August, which
saw the victory of the pro-Sirisena political forces, the resulting new government
launched a novel economic policy, presented by Prime Minister Ranil Wickremesing-
he in his 5 November speech. Wickremesinghe outlined a «Third Generation Reforms
Plan» made up by a complex set of socio-economic reforms which, while beingmain-
ly congruent with neo-liberal orthodoxy, nevertheless included numerous provisions
aimed at promoting the economic welfare of the lower social strata. The budget, pre-
sented on 20 November, reflected this dual aspect. At the end of the year, in spite of the

Danila Berloffa
many continuing difficulties, the Sri Lankan economy still managed «a respectable
growth», exemplified by a full year GDP increase equal to 4.8%.
1. Introduction
During 2015, Sri Lanka witnessed one of the major political develop-
ments of the last decade. The authoritarian rule of the President Percy Ma-
hendra Rajapaksa – alias Mahinda Rajapaksa – indeed came to a conclusion
in the wake of the unexpected result of the presidential election, held on 8
January 2015, two years ahead of schedule. Though the new President of
Sri Lanka, Maithripala Sirisena, used to be the Health Minister of the Ra-
japaksa administration, his election promised a deep change in the political
path followed by his predecessor.
Rajapaksa, head of state from 2005 to 2015, was indeed a controver-
sial figure that came under the scrutiny of international community, main-
ly as a result of his unwillingness to pursue those responsible for the war
crimes committed during the long civil war.1 With the election of Sirisena
as President, a new political phase began, characterized by the progressive
restoration of those democratic rules which had been greatly limited during
Rajapaksa’s increasingly authoritarian and corrupt rule. This process, how-
ever was slowed down and limited by the lack of a parliamentary majority
supporting the new President.
If the political shift in domestic policies was limited, although real, that
in foreign policy was decidedly more pronounced. The close bond between
Sri Lanka and China, which marked the Rajapaksa decade, in fact loosened,
while the relationship with Western countries, especially the United States,
and India became closer. During the year under review, as a result of the im-
proved relationship with Washington, international pressure on Sri Lanka,
above all within the UNHRC (United Nations Human Rights Council), dra-
matically relaxed. This is not surprising, considering the U.S.’s strong sup-
port for Sirisena’s Presidential candidacy. The pro-U.S. attitude of the new
President was indeed welcomed by Washington, which was eager to remove
the South Asian island from the Chinese orbit.
Once in power, Sirisena proved to be able to politically distance himself
from his predecessor. This does not meant that Sirisena’s mandate started
a democratic revolution: since the 1950s, Sri Lanka has indeed been a dys-
functional democracy and the road to turn it into full-bodied and mature
democracies is bound to be full of obstacles.2 The first of them is the realiza-
1. Danila Berloffa, ‘Sri Lanka: l’involuzione democratica del governo Rajapa-

ksa’, Asia Maior 2013.
2. The definition of Sri Lanka’s democracy as being dysfunctional is made with
reference to mainly two political trends. The first one is tied to the way politics has
been pursued, which has favoured executive governance to the detriment of democ-
408
Sri Lanka 2015
tion of the reconciliation between the Tamil and Sinhala communities, as

well as between the North and the South of the island. Six years after the end
of a 26-year gory civil war (1983-2009), the wounds caused by it have not yet
completely healed, leaving open geographical and ethnic deep rifts, which
are preventing Sri Lanka from consolidating its democratic institutions.
2. The Presidential Election: The unexpected defeat of Rajapaksa
The erosion of Rajapaksa’s popular support had already become evi-

dent during the provincial elections held in March and September 2014,
when the ruling Sri Lanka Freedom Party (SLPF) recorded an unprecedent-
ed decline in its share of votes. It was owing to this electoral decline that
Rajapaksa called for an earlier presidential election, aiming to be re-elect-
ed for a third mandate before losing further popular support. The deci-
sion to move up the presidential election was followed by the emergence
of rifts within the United People’s Freedom Alliance (UPFA), namely the
SLFP-headed ruling coalition, which, in turn, led to the resignation of three
ministers among whom the Health Minister, Maithripala Sirisena. Sirisena’s
resignation represented a crucial turn, since he was soon chosen as the joint
opposition candidate. His candidature – supported by Sri Lanka’s former
President Chandrika Bandaranaike Kumaratunga – united a weak and scat-
tered opposition in the newly created New Democratic Front (NDF). The
NDF included several parties, the strongest one being the United National
Party (UNP), and was backed by the Tamil National Alliance (TNA), the left-
ist Janatha Vimukthi Peramuna (JVP), and about 40 civic action movements.
Supported by these forces, Sirisena went on to win the presidential election
(8 January 2015), obtaining 51.2% of the vote against 47.5% received by
Rajapaksa.3
The NDF electoral campaign pledged a democratic and corruption-free
governance, the end of family rule and cronyism, and the re-establishment
of the autonomy of key institutions of governance, in particular the
legislature and the judiciary.4 Above all, the electoral manifesto of the former
racy and the rule of law. The second one is that the Sri Lankan state has traditionally
promoted a vision of democracy based on ethnic exclusiveness and authoritarianism,
which has encouraged majoritarianism and the marginalization of minorities. About
Sri Lanka’s dysfunctional democracy, see: Neil DeVotta, Blowback: Linguistic National-
ism, Institutional Decay, and Ethnic Conflict in Sri Lanka, Stanford University Press, 2004
and Tarzie Vittachi, Emergency 1958: The story of the Ceylon race riots, London: Andre
Deutsch, 1958, and Darini Rajasingham-Senanayake, ‘Dysfunctional democracy and
the dirty war in Sri Lanka’, Asia Pacific Issues, N° 52, May 2001.
3. ‘Official Result of Presidential Election 8-1-2015’, Department of Elections
(http://www.slelections.gov.lk/presidential2015/AIVOT.html).
4. Jayadeva Uyangoda, ‘For a fresh beginning in Sri Lanka’, The Hindu, 10
January 2015.
409
Danila Berloffa
Health Minister consisted of a 100 days agenda, focused on reforming the

presidency, abolishing the Eighteenth Amendment, which made the office
of the President extremely powerful, and changing the electoral system.5
Sirisena’s unexpected victory took place in a relatively peaceful way
and was function of the fact that, together with a part of the Sinhala elec-
torate, the minority communities and their parties massively backed the
former Health Minister’s candidacy.6 Indeed, the main vote support re-
ceived by Sirisena came from those electoral divisions where the Tamil and
Muslim components were overwhelming, in particular the Northern and
Eastern Provinces. The peak of votes for Sirisena was reached in the dis-
tricts of Batticaloa and Trincomalee, in the Eastern Province, where he
received 81% and 71% of the popular vote, respectively. Also the Northern
Province constituency, especially the Jaffna and Vanni districts, massively
endorsed Sirisena’s candidacy, which was supported by more than 70% of
the popular vote.7
Actually, this voting pattern was due less to Sirisena’s popularity
among the ethnic minorities than to their hostility towards Rajapaksa. Ten
years after the end of the civil war, Rajapaksa’s appeal as the national hero
who ended the three decades old ethnic conflict was no longer sufficient
to compensate for the lack of answers to concrete political, economic, and
social issued faced by the country – not least inflation and the high costs
of living affecting the lower classes of society. This being the situation, as
hinted above, even a part – although not the majority – of the conservative
sinhala electorate, which had been the core of Rajapaksa’s support, switched
behind Sirisena. At the same time – as above stated – the Tamil and Muslim
minorities (12% and 10% of total population, respectively), which had been
increasingly marginalized during Rajapaksa’s presidency, voted for the can-
5. Maithreepala [sic] Sirisena, Manifesto. A Compassionate Maithri Governance.

A Stable Country, New Democratic Front (https://www.colombotelegraph.com/wp-con-
tent/uploads/2014/12/Manifesto-English.pdf).
6. Despite the fact that at the end of campaigning 420 incidents of violence
had been documented (20 November 2014 - 5 January 2015), with 237 categorised
as major incidents, the 2015 Presidential election were definitely calmer in compari-
son with the election in 2010. In fact, «the short campaign, unprecedented and gross
imbalance in resources in favour of the incumbent, had the effect of reducing the
incidents of violence throughout the campaign and on polling day» See: ‘Final Report
on Election Related Violence-Presidential Election 2010’, Centre for Monitoring Elec-
tion Violence (CMEV), Colombo, February 2010, p. 20. Instead, the 2010 Presidential
election was characterized by the persistent abuse of state resources and the intensi-
fication of violence, resulting in 5 murders and 121 firearms incidents. In the period
between 23 December 2009 and 25 January 2010, the election campaign recorded
a cumulative total of 809 incidents; among these, 365 were classified as a «major in-
cident». See: ‘Final Report on Election Related Violence-Presidential Election 2015’,
Centre for Monitoring Election Violence (CMEV), Colombo, January 2015, p. 47.
7. The Official Government News Portal of Sri Lanka, Presidential Election - 2015,
(http://election.news.lk/election-results.html).
410
Sri Lanka 2015
didate in the strongest position to defeat Rajapaksa. They cast their vote for
Sirisena, in spite of the fact that he had not made any concrete commitment
favouring their political rights. In the close competition between the two
presidential candidates, the minority groups’ decision to strategically vote
against Rajapaksa proved decisive in determining his defeat. 8
After the poll, the new President swore in the UNP leader Ranil Wick-
remesinghe as the Prime Minister, at the head of a minority «national gov-
ernment» which incorporated the Sri Lanka Freedom Party (SLFP), namely
Rajapaksa’s party, into the UNP-led coalition.9 This rather paradoxical de-
velopment was due to the fact that, although Maithripala Sirisena had won
the election as the common candidate of the opposition, he had maintained
his role as General Secretary of the SLFP. Soon after the election, on 16
January, the SLFP Central Committee decided to hand over the leadership
of the party to Sirisena, justifying its decision with reference to the fact that:
«Article 12-2(a) of the SLFP Constitution stipulates in clear terms that when
a person contests as a SLFP candidate at the Presidential Election and if he
were to win, he automatically becomes the President/Leader of the Party».10
As a consequence, in a highly ironic development, Sirisena not only took
over the SLFP formal leadership from Rajapaksa, but was also made chair-
man of UPFA,11 namely – as above remembered – the political coalition
which had opposed his candidature to the presidency in the just contested
presidential polls. Of course, as was only to be expected, Sirisena was not
able to gain effective control over the UPFA parties, while the same SLPF
split into a pro-Sirisena and a pro-Rajapaksa’s faction.12
3. The first signals of the restoring of rule of law
Despite the weakness of the UNP «national government» and the lack
of a parliamentary majority, the new administration proved to be able to
deal with some of the most urgent issues of the country, curtailing the presi-
dency’s executive powers, reviving the parliamentary system, strengthening
the rule of law, re-establishing an independent judiciary, removing some
8. Jayadeva, Uyangoda, ‘For a fresh beginning in Sri Lanka’.

9. K. Ratnayake, ‘Sri Lankan president forms a «national government»’, World
Socialist Web Site, 25 March 2015.
10. ‘President leads SLFP’, Daily News (Colombo, Sri Lanka), 16 January 2015
(https://www.highbeam.com/doc/1P3-3559282891.html).
11. ‘Maithripala Sirisena Appointed UPFA Chairman’, Asian Mirror, 15 March
2015.
12. Rasika Jayakody, ‘President Sirisena Though SLFP Chairman Does not
have full Control over Central Committee or Executive Committee of the Party’, DB-
SJeyaraj.com, 17 March 2015; Anthony David and Damith Wickremasekara, ‘Power
struggle within SLFP, UPFA; split on the cards’, The Sunday Times (Sri Lanka), 23
August 2015.
411
Danila Berloffa
media restrictions, vigorously pursuing corruption cases, and showing at-

tention to at least some of the needs of the minorities.
In a highly symbolic action, one of the first moves of Sirisena as Pre-
sident was to declare illegal (29 January) the controversial impeachment
of the Chief Justice Shirani Bandaranayake, decided by the previous go-
vernment.13 The destitution of Bandaranayake in 2013 had indeed caused
harsh criticism from the UNHRC and feelings of deep indignation among
segments of Sri Lanka’s civil society. The latter perceived the sacking of the
Chief Justice as an assault on judicial independence in order to annihilate
it.14 Sirisena formally restored Shirani Bandaranayake to the office of Chief
Justice, thereby implementing one of his electoral commitments. Shirani
Bandaranayake formally resigned after two days, but Sirisena following
choice of a new Chief Justice was also very significant, since the President
appointed Kanagasabapathy Sripavan, namely the first Tamil to occupy this
top judicial position in 24 years.15 It was a highly revealing decision, as it
underlined the new President’s willingness to pursue a policy of national re-
conciliation after 26 years of ethnic conflict and a further ten years of majo-
ritarian rule based on a vision of ethnic exclusiveness. After all, Sirisena had
received a strong electoral support from the Tamil community; accordingly
his pursuit of national reconciliation – apart from being an ethically high
profile policy – from a realpolitik viewpoint represented a way to keep the
support of the Tamil electoral block.
Once the above has been pointed out, it is worth stressing that Sirisena’
s decision to appoint a Tamil as Chief Justice was not an isolated decision
but part of a general strategy. A Presidential Task Force on Reconciliation,
headed by the former President Kumaratunga, was established in March
2015, with the aim of identifying the most urgent needs of the minority
Tamil community.16 Also Ranil Wickremesinghe, following his appointment
as Prime Minister, expressed the intent to «implement the Thirteenth
Amendment within a unitary state».17 The implementation of Thirteenth
Amendment, born out of the Indo-Lanka Accord of 1987,18 represented the
main legal instrument with the potentiality to ensure a national reconcilia-
13. ‘Sri Lanka appoints minority Tamil as chief justice’, Al Jazeera, 31 January
2015.
ksa’, Asia Maior 2013, p. 185.
15. ‘Sri Lanka appoints minority Tamil as chief justice’.
16. ‘Ex-Lankan President to head task force for reconciliation of Tamils’, The
Hindu, 26 March 2015.
17. ‘Will implement 13th Amendment within a unitary state: Ranil’, The Hindu,
21 January 2015.
18. The 1987 Indo-Lanka Accord is a bilateral agreement signed between the
Indian Prime Minister Rajiv Gandhi and the Sri Lankan President J. R. Jayewardene
Delhi. The agreement was expected to resolve the Sri Lankan civil conflict through
the devolution of powers to the provinces.
412
Sri Lanka 2015
tion process. In fact, it provided for the devolution of conspicuous legislative

and executive powers to the Provincial Councils, which would automatically
guarantee the autonomy of the minorities, which are numerically dominant
in the north of the island.
Up to Sirisena’s election, the Thirteenth Amendment had never been
fully implemented, and the central government had withhold the powers
entitled to the Provinces, especially the powers related to police and land
authority.19 A week after assuming the Presidency, as an additional gestu-
re aimed at opening up the dialogue with the Tamil community, Sirisena
appointed a new civilian governor for the Northern Province. That area
- despite the conclusion ten years before of the civil war - had been under
the protracted military rule of General G. A. Chandrasiri. Chandrasiri’s
replacement with a civilian governor – the long time diplomat H. M. G.
S. Palihakkara – met «one of the major requests» expressed by the Tamil
electorate.20
The Sirisena administration’s conciliatory policies towards the minori-
ties were also directed towards the Muslim community. In the past few years,
the Sri Lankan Muslim community had become the main target of a hate
campaign carried out by Sinhala Buddhist extremist groups. Significantly,
Sinhala Buddhist extremism developed during the Rajapaksa regime, ta-
king root both in society and politics and benefitting from state patronage.
As a result, in the past decade Sri Lanka witnessed a series of increasingly
frequent communitarian attacks against its Muslim minority which culmi-
nated in the eruption of the 2014 Aluthgama wave of violence.21 Sirisena,
since assuming power, has been engaged in contrasting this chauvinistic
trend. On the occasion of the SLFP convention on 17 March, he stated that
the SLFP was «not a Sinhala Buddhist party».22 Moreover, on 26 May, the
leader of the extremist group Bodu Bala Sena (Buddhist Power Force, BBS),
the Buddhist monk Galagoda Aththe Gnanasara Thera, was arrested by the
police for the first time. Though the monk was released on bail, the episo-
de marked the end of the immunity that the group had hitherto enjoyed.
Through the restoration of the rule of law, the authorities were also able
19. The Northern Province Council election was finally held in September
2013, assuring a landslide victory to the opposition party, the Tamil National Alli-
ance, the historical achievement was devalued by the central Parliament’s attempt to
water down the content of the Thirteenth amendment, as well as through the army’s
reported interference in the conduct of the elections. Danila Berloffa, ‘Sri Lanka:
l’involuzione democratica del governo Rajapaksa’, pp. 19-24.
20. Dharisha Bastians, ‘In Gesture to Tamils, Sri Lanka Replaces Provincial
Leader’, The New York Times, 15 January 2015.
21. On the Aluthgama violence and, more generally, on the Sinhala Buddhist
extremism, see Danila Berloffa, ‘Sri Lanka 2014: la continuazione del regime autori-
tario e la crescente insoddisfazione popolare’, Asia Maior 2014, pp. 352-55.
22. ‘Anti-Muslim Sentiment In Sri Lanka: Hate Incidents – January To April
2015’, Colombo Telegraph, 19 June 2015.
413
Danila Berloffa
either to prevent communal violence or to minimise it, as happened during

the Buddhist Sinhala demonstration at the Kuragala holy site.23 Communal
incidents, which have continued in 2015, with 37 cases recorded in the first
four months of the year, have nevertheless experienced a slight decline in
comparison with the last four months of 2014, which saw 48 cases.24
When Sirisena, in November 2014, resigned as Health Minister to run
as a Presidential candidate, he explained: «Parliament is under this [Rajapa-
ksa’s] family, the ministries are under this family, the judiciary is under this
family, the military and the entire state sector and business and investment
come under the direct control of this family. This country is as unstable as it
could be because of family bandyism and nepotism».25
Indeed, during the Rajapaksa rule, the concentration of power and
wealth in the hands of the presidential family made it similar to a sort of
close-knit oligarchy, beyond the reach of the law. That was a situation which,
during his electoral campaign, Sirisena pledged to end once for all.26 Once
Sirisena became President, the fight against corruption and the abuse of
power was carried out through the establishment of a series of institutional
mechanisms. These included the formation of a cabinet subcommittee on
corruption, a Police Financial Crimes Investigation Division (FCID), and
a Presidential Commission of Inquiry to Probe Corruption and Abuse of
Power. The last was designated to investigate matters such as the illegal
acquisition of lands, irregularities in the Colombo Stock Exchange, and the
handling of money in the Employees’ Provident Fund.27
Basil Rajapaksa, the brother of Mahinda Rajapaksa and the former
Economic Development Minister, was detained in April 2015 on charges
of misappropriating public funds earmarked for the construction of public
housing.28 Another brother of Mahinda Rajapaksa, the former Defence
Secretary, Gotabaya Rajapaksa, was summoned in front of the commission
appointed to investigate allegations of bribery and corruption on 23 April.
23. ‘Police use water cannons on «Sihala Ravaya» at Kuragala’, Asian Mirror, 4
April 2015.
24. ‘Anti-Muslim Sentiment In Sri Lanka: Hate Incidents – January To April
2015’.
25. ‘Sri Lanka’s sovereignty will remain intact under me’, Daily Mirror, 2 Janu-
ary 2015. The expression «family bandyism» is commonly used in Sri Lanka as more
derogatory synonymous of nepotism.
26. ‘Sri Lanka election result: Who is new President Maithripala Sirisena?’, The
Guardian, 9 January 2015.
27. ‘Sirisena appoints Task Force to recover misappropriated state assets’, Co-
lombo Mirror, 1 May 2015 and ‘President Appoints Commission of Inquiry to Probe
Corruption and Abuse of Power’, The Official Website of the President of the Democratic
Socialist Republic of Sri Lanka (http://www.president.gov.lk/news/president-appoints-
commission-of-inquiry-to-probe-corruption-and-abuse-of-power).
28. David Barstow, ‘Sri Lankans Reject Ex-President Mahinda Rajapaksa in
Election, and Prosecution May Follow’, The New York Times, 18 August 2015.
414
Sri Lanka 2015
The anti-corruption campaign, focused on frauds in the different go-

vernment departments and in state owned companies, investigated 220 ca-
ses by August, bringing to light grafts and irregularities concerning major
development projects and leading institutes in the country. Among the lat-
ter there were the arms and security firm Rakna Lanka Company and the
Sri Lankan Airlines.29 The investigations revealed not only the magnitude
and intensity of corrupt practices among officials during the Rajapaksa re-
gime, but also the need for an efficient and independent system to either
prevent or contain such a phenomenon. However, the mechanisms esta-
blished to investigate large-scale corruption allegations did not adequately
meet these standards, given the politicization of the anti-corruption institu-
tions and the magnitude of caseload. On the other hand, the expectations
raised by the government’s rhetoric made it necessary «to act fast to satisfy
voter expectations and capitalize on the old regime’s political weakness».30
It is worth to consider that the chase against corruption crimes took
place in the course of a power struggle during which the former President
Rajapaksa, who was able to keep his influence over a section of the SLPF.
The antagonism between Rajapaksa and Sirisena reached a peak when the
former President’s activities threatened to derail the UNP reform program.
In this respect, the anti-corruption enquiries involving Rajapaksa and his
inner circle certainly contributed to politically weaken the former President.
Since January 2015, the improvement of press freedom within the country
has indeed made Sri Lankan citizens more aware of the alarming features
that marked the Rajapaksa administration.
4. The arduous path of political reforms
The major and more ambitious goal achieved by the UNP-led gover-
nment was the passage of the Nineteenth Amendment, on 28 April. Such
a constitutional change represented a significant step forward in restoring
democracy and the rule of law. Since the end of the civil war, Mahinda Ra-
japaksa had actually embarked on a process of accretion and centralization
of presidential powers, epitomised by the promulgation, on 8 September
2010, of the Eighteenth Amendment. The latter abrogated the presiden-
tial limit of two mandates and gave the President direct power to appoint
judges and a variety of enquiry commissions.31 On its part, the Nineteenth
29. Dhaneshi Yatawara, ‘Fraud, corruption and abuse of power: There are ac-
cused among those contesting’, Sunday Observer, 9 August 2015; ‘Large scale corrup-
tion reports out in Oct’, The Indipendent.Ik, 21 September 2015.
30. ‘Sri Lanka Between Elections’, International Crisis Group, Asia Report N°
272, 12 August 2015.
31. Kalana Senaratne, ‘18th Amendment and the Reawakening Of President
Rajapaksa’, The Sunday Leader, 12 September 2010.
415
Danila Berloffa
Amendment, approved on 28 April 2015, limited the length of the presiden-

tial mandate from six to five years, renewable for a second term only. It also
limited the presidential power to dissolve the Parliament: under Rajapaksa
this power could be made use of after one year, now it could be applied
only after four and a half years. Furthermore, the Nineteenth Amendment
reduced the legal immunity of the President and envisaged a marginal shift
of power and authority to the Prime Minister, though the Supreme Court
rejected the provisions that made the Prime Minister the head of the Cabi-
net.32 Even if the abolition of the executive presidency was the major electo-
ral promise of Sirisena, the road that led to the passing of the amendment
was scattered with obstacles which conditioned the final form of the law.
Indeed, the law turned out to be weaker than most of its proponents had
wanted. The difficulties that Sirisena encountered in implementing the re-
forming agenda resulted both from the need to deal with an heterogeneous
ruling coalition and the lack of a two-thirds majority in Parliament, which is
required in order to pass any constitutional amendment.
The lack of a clear majority proved to be a challenge for the UNP-lead
government. Not surprisingly, one of the main controversial issues faced by
the new government was that of the electoral reform, which had been pro-
mised as part of Sirisena’s 100 day’s agenda and which implied the revision
the Twentieth Amendment. The electoral reform aimed at replacing the
proportional system with a hybrid system, containing proportional and first-
past-the-post elements. Such a system was supposed to ensure both a stable
government and a strong opposition. Nevertheless, since the proportional
system could enable, to a certain extent, the ethnic, social, political, and ide-
ological diversities of Sri Lanka’s society to find representation in all legi-
slative assemblies, the proposed electoral reform threatened to marginalize
both minorities and small parties, consolidating the trend towards ethnic
and social majoritarian in politics.33 Also, there were different viewpoints
among the parties about the abolition of the executive presidency: whereas
the UNP called for a return to the Westminster-style parliamentary model,
the JHU wanted the President to keep key powers to avoid «jeopardising
national security and territorial integrity».34
The debate on electoral reform witnessed the attempt by some sections
of the SLPF to use the issue for short-term political gains. First of all, the
majority faction of the SLPF sought to delay the adoption of the Nineteenth
Amendment and the reform of the electoral system. Secondly, the SLFP at-
tempted to postpone the parliamentary poll to the end of 2015, using a
delaying tactic to exploit the growing anti-incumbency factor. On the other
32. ‘Sri Lanka adopts 19th Amendment’, The Hindu, 29 April 2015.
33. Jayadeva Uyangoda, ‘Electoral Reforms: Some Critical Reflections’, Sri Lan-
ka Brief, 18 April, 2015.
34. ‘JHU announces conditional support to Maithripala’, Island, 3 December
2014.
416
Sri Lanka 2015
side, Prime Minister Wickremesinghe fought for an early dissolution of par-

liament, in order to ride the wave of popular discontent against Rajapaksa
and the UPFA to secure a majority of seats in next parliamentary election.35
Despite the Parliament being dissolved on 26 June, without any agreement
on the electoral reform, Sirisena was able to negotiate with the SLPF, gaining
its support for the Nineteenth Amendment. In order to obtain the SLPF’s
support, the President persuaded Ranil Wickremesinghe to accept the sub-
stantial changes to the bill required by the SLFP. The most important of such
changes was the reduction of the number of civil society members on the
Constitutional Council from seven to three.36 Popular demand and support
from civil society played also an important propulsive role in the process
that led to the passage of the Amendment. In fact, several organizations joi-
ned the Satyagraha campaign arranged by the monk Maduluwawe Sobitha
Thera, whose most important moment was the popular march towards the
parliament building on 27 April.37 Overall, the approval of the Nineteenth
Amendment to the Constitution was a crucial personal success for Sirisena,
who succeeded in passing the bill with a majority of 214 votes in favour.
5. The UNP minority government: a silent revolution?
Maithripala Sirisena’s advent to power and the UNP government’s

policies were surely remarkable, in spite of their limitations. Indeed these
policies were portrayed by the media as a «silent revolution». However, as
highlighted by some observers, what happened in Sri Lanka was mainly a
factional struggle within the Sri Lankan ruling classes, particularly inside
the SLPF.38 The progressive centralization of powers in his own and his
35. K. Ratnayake, ‘Sri Lankan president postpones parliamentary election’,

World Socialist Web Site, 29 May 2015.
36. ‘Sri Lanka Between Elections’, p. 9. The main function of the Constitu-
tional Council was to submit shortlists of three names to the President for any post
of Chairman or member of nine State Commissions with crucially important roles
of control. The President had to chose among the names included in the shortlists.
The State Commissions for which the Constitutional Council recommendations were
mandatory included the Election Commission; the Public Service Commission; the
National Police Commission; the Auditing Service Commission; the Human Rights
Commission of Sri Lanka; the Commission to Investigate Allegations of Bribery or
Corruption; the Finance Commission; the Delimitation Commission; the National
Procurement Commission. See Neil Iddawala, ‘The Constitutional Council in brief ’,
Daily FT, 22 May 2015.
37. ‘Protest held near Parliament in support of 19th Amendment’, News First,
27 April 2015.
38. Neera Wickramasinghe, ‘It’s No Revolution’, The Indian Express, 25 August
2015 and ‘The Guardian view on the end of the Rajapaksa era in Sri Lanka’, The
Guardian, 11 January 2015.
417
Danila Berloffa
family’s hands, undertaken by Rajapaksa, had progressively excluded from

power an increasing number of political players, including high level mem-
bers of the very same SLPF. The latter, while not unduly worried for the ero-
sion of the democratic checks and balances, became increasingly uncomfor-
table as the diminution of their own power.
It is worth noting that Sirisena had held the office of SLFP’s general
secretary for 13 years, and had served the Rajapaksa government both as
the Minister of Agriculture and as the Minister of Health from 2005 onward.
Sirisena had also been the Minister in charge of Defence during the last, and
most bloody, two weeks of the war.39 Consequently, he was in every respect an
active and important member of Rajapaksa’s regime. In this respect, Sirise-
na’s political turn-around could be attributed not so much to a sudden demo-
cratic fervour as to political opportunism. The Rajapaksa family increasingly
tight and monopolistic hold on Sri Lankan political power had translated
into a crony capitalism benefitting the Rajapaksa’s clan and their mignons.
This situation had caused the growing anxiety of both the international inve-
stors and the local business, which, in turn, undoubtedly was a relevant factor
in favouring Sirisena’s decision to challenge Rajapaksa. Once Rajapaksa was
defeated, Maithripala Sirisena and the UNP government, which received the
backing of the Sri Lankan capital, appeared not to be unresponsive to the
call by international financial actors to further push Sri Lanka towards free
market and global investments.40 Actually, both the SLPF and the UNP have
favoured a similar economic development pattern, namely that of a «Singa-
porean hyper-urbanised and consumption-driven» country.41 The new Sri
Lankan regime seemed eager to achieve this goal by rethinking its position
on the international stage and, particularly, by reducing Sri Lanka’s depen-
dency on China in favour of a greater integration in the global economy.
Arguably, the steps made by Sirisena’s administration towards de-
mocratic restoration were accompanied by a certain degree of continuity
with the former regime and the persistence of political anomalies. For in-
stance, the new government appeared reluctant to abrogate the draconian
Prevention of Terrorism Act and to proceed with the demilitarization of
the Northern area of the island, despite both having so negatively affected
the democratic recovery after the end of the civil war.42 Such caution was
39. Sujeewa Amaranath & W.A. Sunil, ‘Who is Sri Lankan President Maithripala
Sirisena?’, World Socialist Web Site, 15 January 2015; J.S. Tissainayagam, ‘Will Sri Lan-
ka’s new president be held to international standards of justice?’, Asian Correspondent,
15 January 2015.
40. ‘Sri Lanka Looks to IMF for Help as Debt Burden Climbs’, Bloomberg, 20
January 2015.
41. ‘The Guardian view on the end of the Rajapaksa era in Sri Lanka’.
42. The figures concerning the military presence in the Northern Province of
the island are widely contradictory: according to the former Defence Secretary Gota-
baya Rajapaksa’s statement released, on 17 June 2012, 15,600 personnel remained
there, in comparison with the 300,000 soldiers stationed at the end of the war. Over
418
Sri Lanka 2015
presumably caused by the influence of the Sri Lankan army, an influence

which had greatly increased following its victory in the civil war. Furthermo-
re, during the Rajapaksa’s regime, the army played a key role in allowing
the President to increase and centralize his powers. In turn, Rajapaksa sup-
ported and promoted the army’s increasing role in civil affairs.43 Thus, the
Sri Lankan army gained a deep ascendency over both society and politics,
which will be hard to remove. Nonetheless, the government adopted some
modest measures to marginally reduce the army presence in Northern
Jaffna District, by returning about 1,000 acres of military occupied land
to the long-time displaced owners. Such an action represented an isolated
gesture, extraneous to any coherent programs for resettlement; therefore its
concrete effect was pretty insignificant. In fact, the above-mentioned land
was undeveloped, with neither original houses nor new military camps or
other government buildings.
In addition, as far as media freedom is concerned, the Sirisena admi-
nistration proved to be ambiguous. The restoration of press freedom was a
major electoral promise of Sirisena’s electoral campaign. In fact, after the
January election, the blocking of independent news websites, implemented
by the old regime, was immediately lifted. Along with this provision, the
President also announced, in May, that the government was determined to
reopen investigations into all past murders and disappearances of journa-
lists.44 Yet, two months later, Sirisena decided to restore the Press Council,
which had virtually ceased to exist after the January Presidential election.
The Press Council was a controversial body, through which the Rajapaksa’s
regime had coerced the media.
the same period, the website of the Civil Military Coordination (CIMIC) of the Se-
curity Forces Head Quarters, Jaffna, stated that «[o]ver 35,000 troops are under its
command». Instead, in agreement with Lalith Weeratunga, the former Permanent
Secretary of President Rajapaksa, outlined that army numbers in the North had fallen
from nearly 120,000 in May 2009, to about 80,000 toward the end of 2013. Despite
those esteems, some studies hypothesize that the ratio of all military and paramilitary
personnel to civilians may well approach 1:5. See: ‘The Forever War?: Military Con-
trol in Sri Lanka’s North’, International Crisis Group, 25 March 2014.
43. Upul Kumarapperuma, ‘Sri Lanka: Are We Heading Towards A Militarized
Society’, Colombo Telegraph, 9 August 2014.
44. ‘Sirisena pledges to improve press freedom’, The Hindu, 30 May 2015. The
Rajapaksa government had a long history of unpunished media harassment and at-
tacks on journalists. Among the most important unsolved cases, it is worth remem-
bering the abduction of the journalist and political cartoonist Prageeth Eknaligoda,
in 2010; the 2009 murder of Lasantha Wickremetunge, the editor of the Sunday
Leader newspaper; the destruction of Sirasa TV, the main independent TV station in
Sri Lanka, in January 2009 by a group of masked men; the January 2009 attack on
Upali Tennakoon; the abduction and beating of the journalist Poddala Jayantha in
June 2009. See: ‘Sri Lanka: No Progress in Investigating Journalist’s Disappearance’,
Human Rights Watch, 24 January 2011.
419
Danila Berloffa
After Rajapaksa’s electoral defeat, Sri Lanka certainly «took a number

of positive steps to address human rights and democracy concerns».45 In
fact, according to a United Kingdom governmental report on human rights
in Sri Lanka, the overall situation improved during the first half of 2015.46
Nonetheless, as shown above, political inconsistencies have marked Sri Lan-
kan democracy even after Sirisena’s election. The positive democratic shift
by Maithripala Sirisena and the UNP-led government, although real, has
been limited and fragile. On the other hand, the restoration of democratic
institutions after a 26 year long ethnic war and a decade of authoritarian
and majoritarian government could be neither an easy nor a speedy process.
6. The Parliamentary Elections and the Formation of National Government
In the electoral Manifesto, Sirisena had promised to held new general

elections hundred days after the presidential election.47 This pledge was re-
deemed in a substantial way, although with some delay, with the dissolution
of the Parliament on the midnight of Friday 26 June, namely ten months
before the completion of the legislature,48 and the convening of the general
election. In doing this, Sirisena, beside keeping a key promise contained
in his 100 days agenda, was trying to consolidate his political basis of sup-
port. The electoral competition saw the UNP-led coalition – the United
National Front for Good Governance (UNFGG), which included, among
others, the All Ceylon Muslim Party, the Sri Lanka Muslim Congress, and
the JHU – challenging the UPFA. Yet, the political struggle was not limited
to the counterpoising of the two main party coalitions, but was, above all, an
intestine fight inside the SLFP, eventually tearing the party asunder. After
the poll was announced, the power struggle between Sirisena and Rajapaksa
to take control over the party intensified, reflecting deep divisions within
the Sri Lankan ruling class. The rivalry became dramatic when the former
President sought to orchestrate his return to the scene as the SLFP prime
ministerial candidate. On the occasion of the party leaders’ meeting, held
on 2 July, Rajapaksa indeed managed to be nominated to compete in the
forthcoming polls.49 His appointment represented a political debacle for
Sirisena, because, had Rajapaksa won at the poll and become Prime Minis-
45. Ibid.
46. ‘Corporate Report. Sri Lanka – in-year update July 2015’, Human rights
internationally, Foreign & Commonwealth Office, 15 July 2015 (https://www.gov.uk/gov-
ernment/publications/sri-lanka-in-year-update-july-2015).
47. Ibid,. p. 9.
48. ‘Sri Lankan Parliament dissolved’, The Hindu, 26 June 2015.
49. ‘UPFA decides to give nomination to Mahinda Rajapaksa’, Adaderana Ik,
3 July 2015, (http://www.adaderana.lk/news/31475/upfa-decides-to-give-nomination-
to-mahinda-rajapaksa).
420
Sri Lanka 2015
ter, he would have wielded those increased political powers, just conferred
by the recently promulgated Eighteenth Amendment. In addition, Sirisena
faced heavy criticism for having been unable to nip in the bud Rajapaksa’s
possible political comeback. However, under the party rules, Sirisena, as
SLPF’s President, had not the power to block the nomination.
All this drove the Sri Lankan President to change radically his at-
titude towards the party. In fact, months of negotiations with SLFP cadres
had only resulted in the President’s failure to impose his leadership on the
party. Accordingly, on 14 July, Sirisena declared that he would not appoint
his predecessor as Prime Minister, even if the SLFP won the majority of
parliamentary seats. Sirisena was legally entitled to do that, as, accord-
ing to the Constitution, the Sri Lankan President had the authority to ap-
point as Prime Minister «the Member of Parliament who in his opinion
is most likely to command the confidence of Parliament».50 Nevertheless,
it is clear that Sirisena intended to exercise this presidential right only as
a last resort; in the short ran, his announcement aimed at undermining
Rajapaksa’s ascendancy and his electoral prospects, in favour of the UNP
candidate, Ranil Wickremesinghe. On the same day of the election (17
August), the Sri Lankan President, in his capacity as the SLFP Chairman,
further displayed his strength by removing thirteen General Secretaries
from the party Central Committee. The Central Committee is the head de-
cision-making body of the SLFP and most of its members were appointed
by Rajapaksa. Sirisena’s move was indeed aimed at consolidating his power
over the party.51
Sharp antagonism clearly marked the two Prime Ministerial candidates
electoral campaigns as well. The rivalry between Mahinda Rajapaksa and
Ranil Wickremesinghe was such as to make the parliamentary election a
competition fashioned along the lines of the presidential election, namely
as a political duel between the Sirisena-sponsored candidate, Ranil Wick-
remesinghe, and Sirisena’s main political adversary, Mahinda Rajapaksa. Ac-
cordingly, the SLPF’s defeat appeared, above all, as Rajapaksa personal de-
feat. Indeed, the poll – which saw a huge popular participation (70% of the
electorate)52 – confirmed the electoral trend initiated by the January poll.
The UNFGG, namely the UNP-led coalition, emerged as the winner, gaining
45.6% of the votes and 106 seats in the 225 members legislature, whereas the
rival UPFA obtained 95 seats only. Nonetheless, the UNFGG’s victory was
less than total, as the winning coalition was not able to secure the 113 seats
required for a having the absolute majority in the new legislature.53
50. Article 43(3) of the Sri Lankan Constitution.

51. ‘LFP purge heralds UPFA break-up’, Sunday Observer, 23 August 2015.
52. ’70 per cent polling in Sri Lanka polls’, The Hindu, 17 August 2015.
53. ‘Composition of the Parliament, Parliamentary Election - 17-08-2015 Of-
ficial Election Results’, Department of Elections (http://www.slelections.gov.lk/2015GE/
AICOMP.html). The UNP’s coalition obtained 93 seats, but it earned an additional
421
Danila Berloffa
The outcome of the parliamentary election essentially reflected the

decline of Rajapaksa’s political appeal, rather than the success of the UN-
FGG coalition. The former President’s defeat as the prime ministerial
candidate was due to two main factors. First of all, Rajapaksa appeared
to have not learned any lessons from his previous electoral debacle, per-
sisting in underestimating the need to gain the confidence of the minority
communities. In fact, he based his electoral strategy almost exclusively on
the nationalist appeal to Sinhala Buddhist voters, making extensive use of
the language of national security and patriotism. His aggressive electoral
campaign centred around three issues: national sovereignty, development,
and the security of the country. The first topic was related to Rajapaksa’s
struggle against the threat of the supposed foreign «conspiracy». The con-
spiracy was allegedly organised by Americans, Norwegians, Europeans, and
Indians, along with the UNHRC, and aimed at interfering in Sri Lanka’s
national affairs. The second issue was based on championing development
policies followed during Rajapaksa’s presidency, which emphasized major
infrastructural projects. The third, which was also the dominant theme of
Rajapaksa’s campaign, was essentially marked by an incendiary commu-
nal attitude focused on highlighting the threat of a possible resurgence of
the Liberation Tiger Tamil Eelam (LTTE). The former President indeed
accused the government of concerting with the LTTE and jeopardising
national security by removing the Army from the North and «nurturing
terrorists».54 This divisive approach ended up being rejected by most of
the electorate, in particular in the electoral districts with a considerable
presence of ethnic and religious minority populations. In those areas, the
UPFA performed even worse than it had in January. It is no coincidence
that the Tamil National People’s Front (TNPF), which embraced a sharp-
ly nationalistic position with a separatist manifesto, also did not gain any
seats, in contrast to the moderate TNA. The latter obtained 16 parliamen-
tary seats, thanks to the remarkable support it gained among Tamil voters,
who appreciated the role played by the party in calling for the building of
democracy by opposing the constantly authoritarian style of the Rajapaksa
regime.55
Unlike the SLPF, the UNP based its campaign on topics related to
development, as indicated by its five-points manifesto – focused on the
growth of the economy, the fight against corruption, the enshrining of
freedoms for all, investments in infrastructures, and improvement of the
13 seats under the national list; the UPFA gained 12 seats under the national list.
Among smaller parties, the IlanKai Tamil Arasu Kadchi (or Tamil National Alliance) and
the Janatha Vimukthi Peramuna obtained 16 and 6 seats respectively.
54. Smruti S. Pattanaik, ‘The Rajapakse «Coup» and Upcoming Parliamentary
Election in Sri Lanka’, Institute for Defence Studies and Analysis, 28 July 2015.
55. ‘Defeat of divisive politics’, The Hindu, 19 August 2015 and T. Ramakr-
ishnan, ‘Clear Message’, Frontline, 18 September 2015.
422
Sri Lanka 2015
education system. This agenda sounded attractive to a wide range of voters,

irrespective of their religion or ethnicity. In addition, while Wickremesinghe
campaigned all over the island, Rajapaksa carried an electoral campaign
that focused on the UPFA strongholds, virtually ignoring the Northern and
Eastern Provinces.
Furthermore, since his defeat in the January election, Rajapaksa’s po-
litical opportunities undoubtedly shrank because of the loss of the political
power he had enjoyed while being in control of the government, with its
machinery and patronage network.56 At the same time, Rajapaksa’s image
suffered a gradual deterioration that affected even his formerly immense
popularity among the Sinhala electorate, especially in urban areas. The in-
quiries launched under the Sirisena administration into allegations of cor-
ruption, abuse of power, and even murder contributed to dispelling the
myth of the national hero that had arisen around the former President.57
Besides, the news circulated that, when defeated at the Presidential poll, Ra-
japaksa had sought to orchestrate a coup, eventually conceding defeat only
because unable to gain the support of the Army Chief and the Police Inspec-
tor General.58 Despite the fact that this accusation had not been proven, it
undoubtedly played a part in further discrediting Rajapaksa. As a result, the
UPFA and its Prime ministerial candidate were not able to achieve the same
kind of electoral mobilisation that Rajapaksa’s charisma alone had achieved
during past elections.59
Despite the UPFA electoral defeat, the lack of an absolute majority
compelled the UNP to engage in intensive negotiations with other parties,
mainly the SLPF, in order to achieve the formation of a National Govern-
ment able to last two years. This task was accomplished on 4 September,
at the cost of conspicuously expanding the cabinet beyond the originally
pledged number of 30, following in this way the pattern previously imple-
56. Siegfried O. Wolf, ‘Analysis: Sri Lankan Presidential Elections’, IndraStra,

8 September 2015, (http://www.indrastra.com/2015/09/ANALYSIS-Sri-Lankan-Presi-
dential-Election-2015-by-Sieggfried-O-Wolf-204.html).
57. In August 2015, Sri Lankan investigators reopened the case of Wasim
Thajudeen’s murder, a rugby player killed in May 2012. The inquiry was linked to
Mahinda Rajapaksa’s son, Yoshitha, and the former President’s security officials. ‘Sri
Lankan rugby player’s body exhumed in murder inquiry’, BBC News, 10 August 2015.
58. ‘Sri Lanka to investigate ‘Rajapaksa coup plot’, BBC News, 11 January 2015.
59. In the 2015 election the UPFA received the 42,3% of the votes, while in
the 2010 Parliamentary elections it received the 60.3%. In the 2004 Parliamentary
Election, the UPFA gained 45,6% of the votes, while the UNP reached 37,8 %. Even
in comparison with the 2015 Presidential election held in January, the UPFA saw a
significant drop from its previous result of 5,79 million votes. In fact, in almost all
district where UPFA won comfortably in January, its share of votes have been reduced
and some of them have shifted to the UNP. ‘Parliamentary General Election 2004’,
Department of Elections (http://www.slelections.gov.lk/island2004.html) and Jayadeva
Uyangoda, ‘A vote for continuing change’, The Hindu, 20 August 2015.
423
Danila Berloffa
mented by Rajapaksa’s administration.60 In fact, the cabinet composition

required a great effort by Wickremesinghe and Sirisena to balance differ-
ent needs and demands. In order to do that, the UNP renounced several
important Ministries, such as those of Power and Energy, Petroleum and
Gas, and Labour and Trade Unions, in order to accommodate its allies.
This was a sacrifice well worth doing, because, according to Sirisena, the
unity government represented a prime strategy for achieving «reconcili-
ation among all communities» and «socio-economic development to face
the new world».61
After the swearing in of the new government, the reconciliation goal
was certainly supported by the new Prime Minister’s decision to recognise
the TNA leader R. Sampanthan as the Leader of the Opposition in
Parliament.62 That was the first time, after over three decades, in which a
Tamil Member of Parliament was appointed to this office.63 This happened
in spite of the opposition of Rajapaksa and his SLFP loyalists, which had
joined the opposition. In fact, the former President and his supporters
requested the appointment of one of them, Kumara Welgama, as Leader of
Opposition. Against this backdrop, Sampanthan’s appointment acquired
a double meaning: on the one hand, it was designed as a reassurance to
the Tamil community with regards to their place in national politics;64
on the other hand, it was a measure to further marginalise the former
President.65
Even with the difficulties faced by Sirisena in the first months of his
office, the President displayed his ability by widening his support and es-
tablishing his leadership over the SLPF, while the party faction still devoted
to Rajapaksa was gradually isolated and weakened. The aim of the National
60. The cabinet stands at 41 cabinet ministers, with a further 7 cabinet minis-
ters and 45 non-cabinet ministers to take oaths. Vimukthi Dissanayake, ‘New Cabinet
to develop the whole country’, The Sunday Leader, 7 September 2015.
61. K. Ratnayake, ‘Sri Lankan president announces «national unity govern-
ment»‘, World Socialist Web Site, 2 September 2015.
62. The motion acknowledging R. Sampanthan as leader of the Opposition
was tabled by Prime Minister Ranil Wickremesinghe on 3 September, and adopted by
the House with 143 voting in favour of and 16 against. ‘TNA’s Sampanthan becomes
opposition leader in Sri Lankan parliament’, The Hindu, 3 September 2015.
63. The first Tamil MP to become opposition leader was Appapillai Amirthal-
ingam in 1977.
64. T. Ramakrishnan, ‘TNA’s Sampanthan becomes opposition leader in Sri
Lankan parliament’, The Hindu, 4 September 2015 and M.S.M. Ayub, ‘Sampanthan
should thank Mahinda for his new post’, Daily Mirror, 11 September 2015.
65. Among the above mentioned measures, it worth noticing that, soon after
the election, Presidet Sirisena appointed to SLFP’s Central Committee the former
Sri Lankan President Chandrika Bandaranaike Kumaratunga. The choice of Kuma-
ratunga, namely the main architect of Sirisena’s candidacyto be President, clearly
indicated Sirisena’s intent to clean up the highest party’s offices from Rajapaksa’s
supporters.
424
Sri Lanka 2015
Government was to «work harmoniously at least for another two years to

come to a consensus on the basic issues affecting the country».66
7. The role of Sri Lanka in the Indian Ocean dispute
The field that has been most affected by the establishment of Sirise-
na’s administration is that of foreign policy. The ensuing political shift has
been highly welcomed by India and Western countries, in particular the
United States. In fact, Sri Lanka is a key nodal point for sea-routes, whose
worldwide importance has increased as a result of the pivotal role the In-
dian Ocean plays in the global economy and the geopolitical strategy of a
number of countries. In fact, the most significant Sea Lines of Communica-
tion (SLOC) and a number of major choke points in the world are hosted
by the Indian Ocean. More than 80% of the global seaborne trade in oil
transits through Indian Ocean choke points, with 40% passing through the
Strait of Hormuz, 35% through the Strait of Malacca, and 8% through the
Bab-el-Mandeb strait.67
Since the end of the 1960s, in the background of the Cold War, for-
eign superpowers and local countries have increasingly paid attention to
this region, engaging in a competition aimed at enlarging their own areas
of influence, securing their vital interests, and imposing their hegemony
on the Indian Ocean. Therefore, the United States, China, and India have
formed a «strategic triangle», within which their rival ambitions over the In-
dian Ocean has emerged more and more acutely.68 After the end of the Cold
War, Washington tried to secure a major role for itself in the Indian Ocean,
with the purpose of containing Beijing’s influence over the area. In fact,
the interests of the United States appeared to be threatened when China
started to increasingly assert its presence on the Indian Ocean chessboard,
especially from the 1990s onwards, when Beijing launched the so called
«String of Pearls» strategy. This strategy has consisted in the establishment
of strategic relations with Indian Ocean littoral countries through the instal-
lation of maritime infrastructure and Chinese detachments in coastal ports,
like Coco Islands, Sittwe (formerly Akyab) and Bassein in Myanmar, Chit-
tagong in Bangladesh, Hambantota in Sri Lanka and Gwadar in Pakistan.
The strategic partnership that China has strengthened with those littoral
Asian countries has been enhanced by infrastructural and commercial coop-
eration. This has allowed Beijing to secure a vital maritime line, connecting
66. W. A. Sunil, ‘Sri Lanka: «National unity government» to implement harsh

austerity measures’, World Socialist Web Site, 21 August 2015.
67. Sergei DeSilva-Ranasinghe, ‘Why the Indian Ocean Matters’, The Diplomat,
2 March 2011.
68. James R. Holmes & Toshi, Yoshihara, ‘China and the United States in the
Indian Ocean’, Naval War College Review, Vol. 61, No. 3, Summer 2008, pp. 41–60.
425
Danila Berloffa
the South China Sea to the Gulf of Bengal, and then on to the Persian Gulf
and the Red Sea. However, the Chinese effort in engineering a «new mar-
itime silk road» predictably collided with both the US and Indian interests
in the area. As a consequence, Sri Lanka, because of its commercially and a
strategically geographical location, could not avoid being involved in this
dispute.69
During Rajapaksa’s rule, Colombo approached Beijing and joined en-
thusiastically its «String of Pearl» plan, which resulted in the launching of
a series of Chinese funded projects – such as the Hambantota port, in the
South of the island. Throughout his presidency, Rajapaksa massively pro-
moted economic and military ties with China, with India and the United
States showing growing concern. As a consequence, during Rajapaksa’s
years relations between China and Sri Lanka have grown closer at a rapid
pace, along with the increase in Chinese investments in the economy of the
island. Foreign direct investment from China, which was US$ 101,2 million
in 2008, grew to 149,3 million in 2011.70 Beginning in 2007, Beijing has
turned into the biggest provider of loans to Colombo, albeit at a high rate of
interest, overtaking countries such as India and Japan, which had previously
been the largest source of financing for Sri Lanka’s infrastructure projects.
In addition, the total trade between Sri Lanka and China has been steadily
increasing over the years, more than doubling from 2009 to 2012.71 The
friendship between Beijing and Colombo was further strengthened in 2013
thanks to the signing of a Strategic Cooperative Partnership and, in 2014,
by the first visit of a Chinese President to Sri Lanka in 28 years, along with
the signing of 27 agreements.72
The Obama administration was undoubtedly irritated by Rajapaksa’s
strong ties with Beijing and eager to bring Sri Lanka closer to its «pivot to
Asia» policy. As a consequence, the role played by Delhi and Washington in
favouring the change of regime that occurred in January 2015 in Sri Lanka
was neither unexpected nor negligible. At first, India and the United States
exerted significant pressure on Colombo through the UNHRC and the po-
tential threat of economic sanctions.73 Given Rajapaksa’s unwillingness to
ksa’, pp. 200–201.
70. Saman Kelegama, ‘China-Sri Lanka Economic Relations: An Overview’,
China Report, Vol. 50, No. 2, 2014, p. 139.
71. Ibid., p. 134.
72. Deepal Jayasekera, ‘Chinese President visits Sri Lanka to strengthen strate-
gic ties’, World Socialist Web Site, 20 September 2014.
73. The United Nations Human Rights Council (UNHRC) adopted three reso-
lutions sponsored by the US government, in 2012, 2013 and 2014, addressed to Sri
Lanka and «directed to undertake a comprehensive investigation into alleged serious
abuses of human rights and related crimes by both parties and establish the facts of
the crimes perpetrated with a view to avoiding impunity and ensuring accountabil-
ity». However, the Rajapaksa administration indignantly rejected all the complaints
426
Sri Lanka 2015
fulfil the UNHRC recommendations, the international body voted in 2014

for a stricter resolution calling on the U.N.’s human rights office to investi-
gate allegations of war crimes, through the establishment of an independ-
ent commission of inquiry.
Sirisena’s election to the presidency was strongly backed by two leading
Lankan politicians with friendly relations with the U.S.: UNP’s leader, Ranil
Wickremesinghe, and Sri Lanka’s former President Chandrika Kumaratun-
ga, the latter being the main architect in bringing Sirisena forward as the
common opposition candidate. Also New Delhi seemed to be involved in
manoeuvring behind the scenes, with the aim of bringing about Rajapaksa’s
departure. Indeed, the Sri Lankan station chief for India’s foreign intel-
ligence service allegedly cooperated with the local opposition parties to get
them to agree on a joint contender for the election, facilitating meetings
and encouraging defections from the UPFA.74
8. Rebalancing Foreign Policy
The confidence of United States and India in Sirisena’s presidential

candidacy was actually well placed. In fact, the foreign policy vision outlined
in the NDF electoral manifesto was grounded on the consolidation of Sri
Lanka’s relationship with its Asian neighbours and a willingness to establish
equal relations with China, Pakistan, Japan, and India. In particular, in rela-
tion to India, the manifesto, by alluding to the different positions vis-à-vis
Sri Lanka taken by India’s central government and by the government of
the nearby Indian state of Tamil Nadu (which, being inhabited by Tamils,
had a special interest for the Lankan Tamil minority), asserted: «Our Indian
policy will take into due consideration the diversity of India». The Manifesto
went on stating: «I [Sirisena]75 would act to have closer relations with an at-
titude that would be neither anti-Indian nor dependent».76 Such an agenda
aimed at allaying New Delhi’s anxiety about its relations with Sri Lanka,
which had witnessed a dramatic deterioration, when, in November 2014, a
pertaining to war crimes allegations, which arose from external actors, perceiving
them as a violation of the internal sovereignty and as an attempt to tarnish the image
of the country. ‘UN Rights Council: Crucial Vote on Sri Lanka Inquiry’, Human Rights
Watch, 26 March 2014.
74. ‘Indian spy’s role alleged in Sri Lankan president’s election defeat’, Reuters,
17 January 2015 and ‘Power plays behind Sirisena’s surprise victory in Sri Lanka’,
Aljazeera America, 20 January 2015.
75. The Manifesto appears to be the record of a programmatic speech made by
Sirisena. Accordingly the promises made there – although officially presented as the
NDF’s electoral program, are formulated in the first person by Sirisena.
76. Maithreepala [sic] Sirisena, Manifesto. A Compassionate Maithri Governance.
A Stable Country, p. 44.
427
Danila Berloffa
Chinese submarine and a warship had docked in Sri Lankan ports, on the
very day the Japanese Prime Minister was visiting the island.77
After assuming office, Sirisena’s first foreign visit, significantly, was to
India. On 15 February 2015, the Sri Lankan President indeed met Naren-
dra Modi in order to strengthen bilateral relations between the two coun-
tries. During the visit, India and Sri Lanka signed four agreements; among
them, the most strategically important was the pact pertaining to civilian
nuclear cooperation. Such an agreement could not but be perceived as a
«major setback for China».78
The rapprochement between New Delhi and Colombo was fostered by
Indian domestic factors as well. In fact, the landslide victory of the Naren-
dra Modi-headed Bharatiya Janata Party (BJP), in May 2014, allowed the
new Indian government to carry out a foreign policy less affected by the re-
quests of the Indian Tamil parties.79 In addition, the BJP-led administration
displayed a renewed eagerness to engage with India’s neighbours and re-
claim New Delhi’s status as a major power in the Indian Ocean, as shown by
Narendra Modi’s five days visit to the Seychelles, Mauritius, and Sri Lanka
(10-14 March 2015). The visit was designed to strengthen India’s key role
among the Indian Ocean island states, improve security cooperation in the
area, and counter China’s growing presence in the region. Modi’s trip to
Sri Lanka was politically very significant, since it was the first Indian Prime
ministerial visit in 28 years to the island. 80 The visit mainly aimed to ensure
that India gained a stronger presence in the eastern port of Trincomalee,
thanks to the joint development of an Oil tank Farm.81 Nonetheless, Modi
77. Wasantha Rupasinghe, ‘India criticises Chinese submarine visits to Colom-

bo’, World Socialist Web Site, 10 November 2014.
78. E.g. Prabhu Chawla, ‘Sirisena’s Visit a Leg up for India-Sri Lanka Ties’,
The New Indian Express, 18 February 2015; Sudha Ramachandran, ‘A New Era for
India-Sri Lanka Relations?’, The Diplomat, 26 February 2015.
79. The Indian government in power before Narendra Modi’s victory, was a
coalition government where the major party, the Congress, not enjoying an absolute
majority, had to take into account the desiderata of its allies, among which there was
one of the two major Tamil parties. On the contrary, the Narendra Modi-headed
government, although formally a coalition government, was under the BJP’s absolute
control, because that party alone had the absolute majority of the Lok Sabha (lower
house). On the different approach to the Tamil question of the Narendra Modi’s gov-
ernment and its predecessor, see Nilanthi Samaranayake, ‘India’s Key to Sri Lanka:
Maritime Infrastructure Development’, The Diplomat, 31 March 2015. More generally,
on India’s neighbourhood policy, Ved Singh, ‘India in a South Asian Context: Modi’s
Engagement with India’s Neighbors. An Interview with Nilanthi Samaranayake’, The
National Bureau of Asian Research, 21 August 2014.
the Congress Party and the beginning of the Modi era’, in this same volume, § 4.2.2.
81. Rohan Gunasekera, ‘India moves to secure Trinco, counter China’, IHS
Maritime 360, 19 March 2015 (http://www.ihsmaritime360.com/article/17151/india-
moves-to-secure-trinco-counter-china).
428
Sri Lanka 2015
also took the opportunity to raise the Tamil issue, urging Colombo to im-
plement the provisions enclosed in the 1987 Indo-Sri Lankan agreement.82
New Delhi’s effort at strengthening its position in the Indian Ocean
was a product of the need to reverse what had been a protracted phase
of policy neglect, which had favoured China’s strategy to become a major
player in the area. In fact, as regards to Sri Lanka, India had failed to pro-
vide significant investments in the country’s maritime infrastructure, which
the island-state perceives as essential to achieving its national development
goals.83 That was a situation that the new Indian Prime Minister appeared
keen to reverse.
Not surprisingly, China’s relations with Sri Lanka seemed to be heading
for trouble, when, soon after the January Presidential election in Sri Lanka,
anti-corruption probes were started, putting under scrutiny the allegedly
tainted ties between the Rajapaksa administration and the Chinese invest-
ments in Sri Lanka. Following this probe, the construction of the Colombo
Port City, a US$ 1,4 billion Chinese project, funded by a company consid-
ered a security risk by New Delhi, was suspended until the completion of an
inquiry into allegedly unlawful awarding of the contract. To this followed a
meeting between the Sri Lankan Foreign Minister Mangala Samaraweera
and the Chinese Premier Li Keqiang in Beijing (27 February 2015), during
which the Sri Lankan Minister sought to renegotiate some huge loans given
by Beijing at rates as high as 8%. Samaraweera also announced the decision
not to allow further Chinese submarines docking in Colombo.84
Once all this has been pointed out, it is worth stressing that Sirisena’s
foreign policy did not aim at breaking ties with China, but at rebalancing
them. In fact only one month after his visit to India, the Sri Lankan Presi-
dent went to Beijing to meet Xi Jinping (25-27 March 2015). On that occa-
sion, the two countries reaffirmed their longstanding ties and the Chinese
President expressed China’s eagerness to «again promote and elevate the
Sino-Sri Lankan relationship to fulfil an important purpose».85
Beijing did not appear to be resigned to a weakened friendship with
Colombo. China considered its friendship with Colombo as being funda-
mental to its strategy in the Indian Ocean, in order to keep its favourable
position in the region and secure its growing energy needs. Accordingly,
the Chinese answer to Sirisena’s rebalancing in foreign policy was to pledge
82. ‘Narendra Modi’s 13th Amendment call gets mixed reactions in Sri Lanka’,
The Economic Times, 16 March 2015.
83. Nilanthi Samaranayake, ‘India’s Key to Sri Lanka: Maritime Infrastructure
Development’.
84. Abdul Ruff, ‘China woos Sri Lanka with more infrastructure projects: Presi-
dent Sirisena to visit Beijing this week’, Asian Tribune, 24 March 2015.
85. Richard Armitage, Kara Bue & Lisa Curtis, ‘Sri Lanka Is Ready to Take
Center Stage’, The Wall Street Journal, 28 January 2015; ‘Sri Lanka seeks improved
relations with China’, Aljazeera, 26 March 2015.
429
Danila Berloffa
over US$ 1 billion new grant to Sri Lanka after a Chinese luxury real estate
project in the capital Colombo was suspended. Furthermore, Chinese com-
panies agreed to cut the cost of the US$ 520 million project to build a road
in a Colombo suburb by $ 225,73 million.86
The apparent slowdown experienced by Sino-Sri Lankan relations is
likely to result in a «normal» relationship with Beijing, which could enable
Colombo to avoid irritating India and the United States. According to gov-
ernment spokesman Rajitha Senaratne, the Sirisena’s administration has
not been «against China, but we have been analysing and re-evaluating all
the projects so that Sri Lanka gets the best deal».87 Chinese investments in
Sri Lanka have been significantly greater than Indian ones and, despite the
political change that has occurred in the island, Beijing’s presence in the
area will likely «continue to rise in the coming years».88
9. The reconciliation between Sri Lanka and United States: implications on the
UNHRC attitude
The remarkable shift that occurred in Sri Lankan international re-

lations following Sirisena’s rise to the presidency was reflected notably in
the attitude of Washington towards the island-state. The United States,
indeed, praised the result of the January 2015 Presidential poll and wel-
comed the regime change that took place on the island.89 Apart from the
rhetoric about the Sri Lankan democratic twist, Washington was pleased by
the pro-Western bias in Sirisena’s foreign policy agenda, which could not
but favour the U.S. strategic interests. The ensuing change in the Sri Lan-
ka-U.S. relations was signalled by the visit of U.S. Secretary of State John
F. Kerry to Sri Lanka, in May 2015. The visit had a highly symbolic value,
since Kerry was the first top-level U.S. diplomat to visit Sri Lanka in ten
years. The reconciliation between the two countries brought with it other
important consequences, especially as far as the UNHRC was concerned, as
the Obama administration adopted a more compliant approach on the is-
sue of war crimes accountability. In fact, the prospect of setting up a United
Nations investigation into the war crimes committed during the Sri Lankan
86. ‘China offers over $1 bln in grants to Sri Lanka after port project halt’,
87. Annie Gowen, ‘Can Sri Lanka’s new government break free from China?’,
The Washington Post, 16 August, 2015.
88. Sudha Ramachandran, ‘A New Era for India-Sri Lanka relations?’, The Dip-
lomat, 26 February 2015.
89. Barack Obama commented the event with the following statement: «Be-
yond the significance of this election to Sri Lanka, it is also a symbol of hope for those
who support democracy all around the world». ‘Sri Lanka wakes up to new era under
President Sirisena’, The Guardian, 10 January 2015.
430
Sri Lanka 2015
civil war, previously strongly supported by the United States, appeared to

have become less compelling with Sirisena’s election. The point of view of
Washington on the issue was well formulated by New York Times’ journalist
Ryan Goodman: «Pushing for full, sweeping accountability in this fragile
moment of transition could destabilize the new government and jeopard-
ize the warming of relations between the United States and Sri Lanka».90
Since the beginning, Sirisena’s administration struggled both to avoid an
independent international investigation and to gain a postponement in the
release of a UNHRC «landmark enquiry» into possible war crimes, origi-
nally scheduled for March 2015.91 Essentially, Sirisena sought successfully
to convey the impression that his government was, on one side, definitely
more open to pursuing the responsible of war crimes than that of his pre-
decessor, but, on the other side, maintained Rajapaksa’s same stand with
respect to averting direct international involvement in war crimes prose-
cutions.
After fruitful negotiations within UNHRC and with Washington,
Colombo was able to obtain a six-month delay of the presentation of the
U.N.’s report on war atrocities.92 This concession to the Sirisena admin-
istration was granted in anticipation of the conclusion of the scheduled
general elections.93
In addition to postponing the resolution, the Sri Lankan government
reached a further and greater success. This was the achievement, within
UNHRC, of a mutually agreeable mechanism for addressing the issue of
war crimes and human rights violations in the country. Such a mechanism
was envisaged in the resolution passed without any opposition, on the oc-
90. Ryan Goodman, ‘Helping Sri Lanka’s New Democracy’, The New York
91. Somini Sengupta, ‘U.N. Delays Release of Report on Possible War Crimes
in Sri Lanka’, The New York Times, 16 February 2015. The UN Report listed the
findings of the investigations, disclosing a series of war atrocities, including: un-
lawful killings, enforced disappearances, torture, sexual and gender-based violence,
recruitment of children, impact of hostilities on civilians and civilian objects. The
Report concluded with recommendations calling for «hybrid special courts, integrat-
ing international judges, prosecutors, lawyers and investigators.» In the opinion of
the authors of the Report, «Such a mechanism will be essential». ‘Comprehensive
report of the Office of the United Nations High Commissioner for Human Rights
on Sri Lanka’, Annual report of the United Nations High Commissioner for Human Rights
and reports of the Office of the High Commissioner and the Secretary-General, 28 September
2015, p. 16.
92. Somini Sengupta, ‘U.N. Delays Release of Report on Possible War Crimes
in Sri Lanka’.
93. Had the resolution been released in March, according to schedule, it
would likely have adversely affected UNP’s chances to emerge as the winning party.
In fact, the publication of the report before the polls would have provided Rajapaksa
with a pretext to inflame Sinhala nationalist feelings, boosting his possibilities of
being elected Prime Minister.
431
Danila Berloffa
casion of the 30th session in Geneva on 1 October 2015.94 The motion had
the strong endorsement of India and, importantly, the crucial support of
the United Stated.95 Indeed, the latter took an active part in searching for
a joint solution through consensus, and the final UNHCR document repre-
sented the outcome of this effort. The final content of the resolution prob-
ably exceed even the more ambitious hopes of the Sirisena administration,
meeting fully Sri Lankan demands. Firstly, the UNHRC document acknowl-
edged «the steps taken by the Government of Sri Lanka since January 2015
to advance respect for human rights and to strengthen good governance
and democratic institutions».96 Secondly, the resolution largely backed the
Sri Lankan aspiration to implement a domestic accountability mechanism,
rather than establish an international court. As a result, the accountability
mechanism by the UNHRC was pretty far from the hybrid special courts
suggested by both the U.N.’s report and the High Commissioner, Prince
Zeid Ra’ad Zeid Al-Hussein.97
The UNHRC resolution represented a dramatic shift in the United
States’ position on the issue of Sri Lankan war crimes. No doubt, this sof-
tening of Washington’s stand can be explained by the more collaborative
attitude showed by the Sirisena administration and its asserted willingness
to make those responsible for war crimes accountable. On the other hand,
it clearly aimed at further encouraging Colombo to more closely enter into
the US network of strategic alliances in the Asia-Pacific region, leaving the
Chinese orbit for good.
Although a clear-cut success, as pointed above, the UNHRC resolution
was doomed to disappoint sections of Sri Lankan society, namely both the
94. ‘Consensus resolution on promoting reconciliation, accountability and hu-

man rights in Sri Lanka adopted at UNHRC’, Tamil Guardian, 1 October 2015.
95. ‘UN Human Rights Council calls for Sri Lanka civil war accountability’, Al
Jazeera America, 1 October 2015; ‘UNHRC adopts the Sri Lanka Resolution’, The Of-
ficial Government News Portal of Sri Lanka, 2 October 2015. The United States actively
sought Sri Lanka’s collaboration in drafting the UNHRC resolution, shifting deeply
its previous stand. According to U.S. Assistant Secretary of State Nisha Desai Biswal,
Washington expressed the hope that «it will be a resolution which we hope to offer
collaboratively, working with the government of Sri Lanka and with other key stake
holders». See ‘US backs internal Sri Lanka war crimes investigation’, Al Jazeera Amer-
ica, 26 September 2015.As far as the Indian endorsement is concerned, see ‘India
supports Sri Lankans’ quest for justice’, The Hindu, 26 September 2015.
96. ‘Full Text Of The HRC Draft Resolution On Sri Lanka’, Colombo Telegraph,
19 September 2015.
97. See fn. 91 for the U.N. recommendation calling for «hybrid special courts,
integrating international judges, prosecutors, lawyers and investigators.» On his part,
Prince Zeid Ra’ad Zeid Al-Hussein, had argued that a purely domestic Sri Lankan
court «will have no chance of overcoming widespread and justifiable suspicions
fuelled by decades of violations, malpractice and broken promises». See ‘The UNHRC
adopts consensus resolution on Sri Lanka’, Channel 4 News, 2 October 2015 (http://
www.channel4.com/news/the-unhrc-adopts-consensus-resolution-on-sri-lanka).
432
Sri Lanka 2015
Sinhala nationalist groups and the Tamil community. The former, indeed,
blamed the government for allowing the international community to violate
Sri Lankan sovereignty, while the latter perceived the provisions included in
the resolution as too mild. A joint statement on the draft UNHRC resolu-
tion, issued on 29 September by a wide range of Tamil civil society groups
and political parties, reflected their frustration. They regretted the lack of
adequate provisions for the setting up of a credible investigation. According
to the joint statement, the UNHRC resolution merely sought «to provide the
appearance of credibility to a domestic process through the appointment of
‘commonwealth and other foreign judges, defence lawyers, and authorized
prosecutors and investigators’».98 Consequently, the judicial mechanism,
managed to a great extent by the Sri Lankan state, was, in fact, branded by
the Tamil groups as not credible for the (mainly Tamil) victims. As a mat-
ter of fact, the UNHRC resolution called merely for an oral report in June
2016 and a written report in March 2017. This arrangement appeared like a
noteworthy attenuation of international pressure on Sri Lankan state, if not
even a sort of disengagement.
10. Political Economy
10.1. The Interim Budget and after

At the beginning of the year under review, the economic situation ap-
peared bleak. During the first quarter of 2015, Sri Lanka witnessed a signif-
icant slowdown in its GDP growth, which, in comparison with the previous
year, went down from 7.4% to 4.4%.99 Its causes were several. One was that,
the country’s total debt had reached US$ 58.7 billion, which implied heavy
annual costs in debt servicing.100 This was a situation which had come into
being in the previous decade, mainly as a consequence of expenditures on
98. ‘Joint Statement of Tamil Political Parties’, Civil Society Organisations & Trade
Unions on the Draft Resolution on Sri Lanka, 29 September 2015, § 3. The statement
also said that its authors «deeply regret that references to demilitarization of the
North-East and an increased role for the OHCHR [Office of the High Commission
of Human Rights] which were included in the initial draft of the resolution have been
removed from the current draft tabled before the UNHRC». Ibid., § 4.
99. ‘Asian Development Outlook 2015’, Asian Development Bank
(http://www.adb.org/publications/asian-development-outlook-2015-financing-
asias-future-growth), p. 121. According to the document, in 2015, Sri Lanka adopted
the United Nations System of National Accounts, the International Standard of In-
dustry Classification and the Central Product Classification, recommended by the
United Nations. The production boundary has been expanded to include economic
activities that were not fully captured under the previous system, enlarging the meas-
ured size of the economy in 2010 by 14.4% over the previous GDP series.
100. Saman Gunadasa, ‘Sri Lankan currency falls sharply’, World Socialist Web
Site, 21 September 2015, § 10.
433
Danila Berloffa
large infrastructure development projects, the financing of imports, and

loan repayments.101 As half of the total debt was foreign debt, this, by itself
powerfully contributed to the worsening the country’s balance of payments.
A conspicuous role in it was played by the infrastructure projects funded by
Beijing, which caused Sri Lanka to triple its foreign debt over the past five
years, due to the high interest rates of Chinese loans.102
This situation was further aggravated by the adverse effects of the
world-wide international economic crisis.
To the above long term factors, two others added themselves at the
beginning of the year under review. The first was the new government’s
decision to suspend a series of construction projects funded by Chinese in-
vestments.103 Of course, as has been pointed out above, repaying the debts
related to the infrastructure projects funded by the Chinese was a major
factor in the Sri Lankan balance-of-payments crisis. However, to suddenly
suspend them could not but adversely impact on the economy as a whole,
because, since the end of the civil war in 2009, the Sri Lankan economy had
mostly been driven by them, allowing the Rajapaksa’s regime to sustain an
impressive average annual growth of 7.4%.104
The second contingent cause of the economic slowdown was the uncer-
tainty brought into being by the change of regime that occurred in January,
along with the prospect of a new parliamentary election during the course
of the year.105
This being the situation, the interim budget, approved on 29 January
2015, was nevertheless aimed less at remedying the causes of the economic
slowdown than at pursuing the goal of social justice (or, should one prefer
the language normally employed by the mainstream media and neo-liberal
101. The Sri Lankan external debt went up from US$ 12 billion in 2006 to
50 in 2014. Over the same period, the debt service ratio about tripled. See: Palitha
Ekanayake, ‘Sri Lanka heading for a major debt crisis’, The Sunday Time (Sri Lanka), 3
May 2015, and ‘Reduction of massive foreign debt burden imperative in 2015’, Lanka
News Paper, 4 January 2015.
102. According to the Finance Minister Ravi Karunanayake, «a bulk of the gov-
ernment expenditure goes into servicing» Chinese loans. This drove the Minister
to address China about the need to adjust the terms of the debt. However, Beijing,
reacting to the deadlock of its projects in the island (on this more later), appeared un-
willing to accommodate Colombo’s requests on the matter. See ‘Sri Lanka asks China
to adjust terms of loans to help overcome financial crisis’, Colombo Page, 18 October
2015; ‘Rising foreign debt due to Chinese investment has nearly crippled the island
nation’s economy’, Time, 19 October 2015.
103. ‘Sri Lanka 2015 growth seen at 7 pct amid infrastructure graft probes’,
104. Growth in the construction sector slowed to 4.1% in the first quarter of
2015, less than a third of the annual average growth rate of 12.8% during the last eight
years. ‘Sri Lanka economy to grow 7.2 pct in 2015 - FinMin’, Retuers, 15 June 2015.
105. E.g. Asia Development Bank, Sri Lanka: Economy (http://www.adb.org/
countries/sri-lanka/economy).
434
Sri Lanka 2015
economists, at implementing populist policies). Of course, in whichever way

one views the measures characterising the 2015 Interim budget, they had
the advantage of likely gaining electoral support for the parties in govern-
ment during the incoming general election.
Among the most notable provisions, aiming at pursuing social justice
by raising the living conditions of workers and the poor, there were the
enhancement of the salaries of state sector public servants, the raise of pen-
sions, the cutting of farmers’ loans by 50%, the cutting of taxes on 13 es-
sential food items, the continuation of the agricultural fertilizer subsidy,
and the raise of the education allocation to 6% of GDP. Also congruent
with social justice goals can be considered those interim budget provisions
introducing additional taxes on the most profitable private companies and
the wealthy – such as an annual mansion tax, a 25% «Super Gain Tax» on
companies whose profits exceed 2,000 million rupees, a tax on casino busi-
ness-owners, and a onetime tax on telecommunication providers and mo-
bile phone operators.106
In spite of its expansive character, the Interim Budged aimed at bring-
ing down the fiscal deficit from the 4.6%, estimated in the previous budget,
to 4.4%. This target was aimed at by the dubious method of cutting public
investment from 6.2% to 4.5%.107
Not surprisingly, criticism to this policy came from the International
Monetary Fund (IMF), which disapproved of the financial measures adopted
by the Sri Lankan government for lacking credible steps to boost revenues;
the IMF warned that such measures could threaten the island nation’s fiscal
consolidation.108 The IMF had indeed demanded that Sri Lanka enhanced
its revenues and implemented a policy of economic austerity as a precondi-
tion for any new loan.109 However, as shown above, the interim budget went
in the opposite direction, and, in spite of its rosy forecast, the fiscal deficit
106. All information related to the Interim Budget are taken from the Sri Lan-
kan Budget Speech of Finance Minister Ravi Karunanayake, 29 January 2015. The
Interim Budget speech, whose official title is ‘Statement by the Minister of Finance
on Hundred Day Revolution’ is available in the in the official site of the Ministry of
Finance, Department of Fiscal Policy, of the Government of Sri Lanka (http://www.
treasury.gov.lk/publications/budget-speeches.html). More synthetic information is
available in ‘Interim Budget 2015’, Daily Mirror, 29 January 2015 (on whose site,
however, even the full text of Karunanayake’s speech is available), and ‘Sri Lanka:
Budget Highlights’, Asian Tribune, 30 January 2015.
107. ‘CT CLSA Securities’ take on Interim Budget 2015’, Dayly FT, 5 February
2015.
108. Shihar Aneez, ‘Sri Lanka budget to focus on populist steps ahead of polls’,
Reuters, 29 January 2015.
109. Indeed, Sri Lanka had requested a US$ 4 billion loan in order to restruc-
ture debt repayments on high-interest Chinese loans negotiated by the government
of the former president. Eventually, however, the IMF turned Sri Lanka’s request
down on 4 March 2015. See Saman Gunadasa, ‘IMF rejects Sri Lankan request for
loan bailout’, World Socialist Web Site, 20 March 2015.
435
Danila Berloffa
target was exceeded in the first semester of 2015. According to Govern-

ment’s data it reached 4.7%, whereas, according to IMF estimated, the full
year budget deficit was likely to be close to 6.0% of the GDP.110
In spite of the IMF criticism, the expansion of expenditures promoted
by the interim budget seemed, at first, to be able to revive the economic
growth, which, in the second quarter of the year, increased to 6.7%. The
growth appeared to be broad based – with tourism earnings that grew no-
tably by 14% – despite agriculture continuing to underperform because of
drought early in the year, which were followed by heavy rains and flood-
ing.111 Also the inflation trend improved, as it experienced a remarkable
drop, especially related to fuel and food prices. Indeed, food inflation went
down from 12% in December 2014 to 2.5% in August 2015.112
These positive developments were however more than overshadowed
by the rising debt and the accelerated worsening of the balance of pay-
ments.113 According to an analysis published in the influential Wall Street
Journal in mid-September, «Sri Lanka’s rising debt [was] unsustainable and
the country [was] heading for another balance-of-payments crisis». The
same analysis went on pointing out that debt financing was «dangerously
reliant on commercial borrowing at a time of increasingly volatile capital
flows to emerging markets».114
10.2. Wickremesinghe’s «third generation» reform plan

On 5 November, Prime Minister Ranil Wickremesinghe, delivered a
statement in front of the Parliament, outlining the plan for a complex set
of socio-economic reforms. Some of these reforms appeared well thought
out, others were barely outlined; all of them, however, aimed at making the
110. ‘Sri Lanka budget deficit overshoots 2015 target in July’, Economy Next, 12
October 2015. See also ‘IMF Executive Board Concludes Third Post Program Moni-
toring Discussion with Sri Lanka’, International Monetary Fund Press, No.15/192, 5 May
2015, (https://www.imf.org/external/np/sec/pr/2015/pr15192.htm).
111. ‘Sri Lanka targets agricultural growth’, Oxford Business Group, 8 June 2015.
In 2014, the agriculture sector’s input edged up by just 0.3%, compared to an in-
crease of 4.7% the previous year, largely due to adverse weather conditions. As far as
the Sri Lankan tourist industry is concerned, the civil war almost destroyed this sec-
tor. However, since 2009 tourism experienced a continuous growth, so that, accord-
ing to MasterCard’s latest Global Destination Cities Index, Colombo was ranked as
the world’s fastest growing tourist destination. See: Yuwa Hedrick-Wong & Desmond
Choong, ‘Master Card Global Destination Cities Index-Tracking Global Growth:
2009-2015’, 2015 (https://newsroom.mastercard.com/wp-content/uploads/2015/06/
MasterCard-GDCI-2015-Final-Report1.pdf), p. 2.
112. ‘Asian Development Outlook 2015’.
113. Central Bank of Sri Lanka - Communication Department, Press Release.
External Sector Performance-June 2015, 21 August 2015.
114. Razeen Sally, ‘Sri Lanka’s Economic Challenge’, The Wall Street Journal, 15
September 2015.
436
Sri Lanka 2015
economy of the island flourish, while keeping in mind both social justice
and the need to heal the wounds of the civil war.115
Wickremesinghe’s action plan appeared to be influenced on one side
by the history of the island, which, in pre-colonial times had been a major
hub in the flourishing Indian Ocean trade routes, and, on the other, by
Singapore’s contemporary example. As remembered by Wickremesinghe,
Singapore, which in the 1950s looked up to the Sri Lankan example, envi-
sioning to follow it, had conquered a much more advanced position, becom-
ing a major regional power, in spite of its complete lack of natural resources,
«not even water».
In order to reach his goal, Wickremesinghe intended to introduce a
«third generation» economic reforms. As remembered by the Prime Minis-
ter, after the post-WW2 period, when Sri Lanka had «lived with the false no-
tion that the Government must somehow intervene in the economic process»
and when «heavy taxes were imposed on the private sector that negatively
affected imports and exports», a first set of reforms, were introduced by
President J.R. Jayawardena in 1977, starting to change the existing system.
These were followed by a «second generation economic reforms», which
«took place under the aegis of President Premadasa» (in office from 1989 to
1993). At the time, according to Wickremesinghe: «The investment climate
and the stock market were dynamic and free to grow in leaps and bounds.
State enterprises that were considered not relevant to be managed by the
Government were given to the public. The initial growth and expansion of
the garment sector, which forms a key economic area today, took place at
the time.»
According to Wickremesinghe, all that had changed for the worse dur-
ing the Rajapaksa’s administration, whose procedures, based on «erratic
economic process and irregular practices» had pushed the country into an
«economic abyss». Now, in Wickremesinghe’s own words, it was the time «to
steer the country in the right direction with the third generation economic
reforms that would herald in a new era».
What said so far can lead one to think that Wickremesinghe’s «third gen-
eration» reforms merely amounted to a more or less extensive implementa-
tion of the usual neo-liberal economic policies, giving a free hand to inter-
national and domestic capital, without much attention for the needs of the
subordinate classes. This is an impression which could not but be strength-
ened by Wickremesinghe’s reputation as a friend of free-market policies and
a critic of state intervention in the economy. But already Wickremesinghe’s
115. All references of Wickremesinghe’s speech are from the full text, available
in the official portal of the Sri Lankan government. See ‘Economic Policy Statement
made by Prime Minister, Ranil Wickremesinghe in Parliament on November 5, 2015’,
NEWS.LK The Official Government News Portal of Sri Lanka. As the document is not
in PDF and the paragraphs are not numbered, no indication of the pages or para-
graphs, these are not indicated in the quotations given below.
437
Danila Berloffa
reference to former President Ranasinghe Premadasa was a give-away that

the Prime Minister’s strategy was something more complex than the simple
implementation of the neo-liberal orthodoxy. Indeed Premadasa had started
his public life as an activist working for the uplifting of the poor and ended it
as a President who had played a key role not only as the author of the «second
generation» reforms, but in the field of poverty alleviation. In fact, Wickrem-
esinghe’s action plan, while pushing for a series of policies congruent with
neo-liberal orthodoxy, included numerous provisions aimed at promoting the
economic welfare of the lower social strata. As claimed by Wickremesinghe
himself, towards the closing of his speech: «The economy we plan to build
must yield results for all. An economy that will promote the benefits of devel-
opment among all. An economy that will be friendly to all, beneficial to all.»
In order to achieve this objective, Wickremesinghe outlined a com-
plex set of strategies. The most impressive was the plan to establish a State
Holding Corporation Limited, «built along the lines of the famous Temasek
Company of Singapore», with the task to manage «on sound economic prin-
ciples and market economies» all state enterprises. At the same time, the
shares of state enterprises would be sold to the public through a newly cre-
ated Public Wealth Trust, whose managing board would be selected from the
ranks of civil society, unions and chambers of commerce, and whose activi-
ties would be supervised by the Secretary of the Treasury and the Governor
of the Central Bank.
Another key strategy aimed at confronting «the catastrophe facing the
rural economy». This strategy implied the establishment of 2500 state rural
development centres, the building or strengthening of rural infrastructures,
the creation of «large scale enterprises in which farmers can be members».
Moreover, «a fully fledged agro marketing authority that will purchase all
agricultural produce» was to be established. Its task was handling «all mat-
ters relating to marketing, storage, sourcing markets, improving transport,
purchasing of produce at a village and provincial level, preserving of pro-
duce and freezer facilities». Finally, the Prime Minister planned both «to
put into place a mechanism that will encourage and empower landowners
investing in new technology and farming methods», and to gear Sri Lanka’s
agricultural production to meet the food requirements of the middle class
in the SAARC (South Asian Association for Regional Cooperation) region.
An additional key strategy aimed at empowering «3 millions citizens to
become land and house owners», through a set of policies, including a low
interest loan scheme.
Wickremesinghe also envisioned the carrying out of a series of insti-
tutional reforms aimed at making the state machinery more efficient and
more responsive to the needs of the Sri Lankan population. Among them
there was the creation of a new pension fund; the establishment of a new
Employment Council in charge to ensure minimum wages for the work-
ing population; structural changes in the Central Bank, making it more
438
Sri Lanka 2015
independent; the creation of a Tea Industry Committee to enhance the

efficiency in tea production; the creation of an International Trade Agency
«that will handle all aspects of international trade»; the restructuring of
the Board of Investment, of the Export Development Board and of the
Tourism Authority. Finally, an Agency for Development, bearing responsi-
bility for «managing all economic activity» and «manned by professionals
from the state and the private sector» was to be created within three years.
The same deadline was set for restructuring the Board of Investment, the
Export Development Board and the Tourism Authority. No clear cut dead-
line was set for the creation of restructuring of the others above quoted
institutions.
Expenditures on education were to be augmented, taxes on knowledge
and talent removed, and women were to be supported. In fact, another
main government effort was to be geared at «reviewing the possibility of
providing economic empowerment for women». «We will implement a pol-
icy of ensuring that 25% of all political representation at provincial gov-
ernment level will be allocated to women», said Wickremesinghe. He went
on promising that: «In future, from 2017 onwards, when making budget
allocations, it will be based on identifying financial needs on a gender basis,
enabling women to have better access to opportunities at all levels».
The Prime Minister also pointed out the intention to rebuild the war
affected areas in the North and East of the island. To this effect, Wickremes-
inghe stated that «we have discussed with Japan the possibility of conveying
an aid summit in this regard in 2016».
On a more strictly economic plan, the Prime Minister, while taking
pride in the economic policies introduced with the interim budget, and
pointing out that, as a result, «people have more money in their hands»,
announced a series of changes, on the whole favouring the business com-
munity, but not only it. Among these changes there was the reduction of the
budget deficit to 3.5%116 and the abolition of the «Super Gain Tax». The lat-
ter had «served the purpose of propping up demand and providing relevant
revenue», but was not needed any more. Also the Prime Minister stressed
the fact that, in order to achieve the results broached out in his speech, it
was vital «to encourage foreign investment and investment by individuals».
Consequently he promised protection for local and global investors and
announced the government intention not to make use of Under Utilized
Asset Act, which had been misused in the past, in order to harass business,
in some cases taking it over. «We will not engage in such activities.» an-
nounced Wickremesinghe, who went on saying: «The Government will not
take over private enterprises. We will also review the business taken over in
this manner».
116. At the time of Wickremesinghe’s speech, the estimated budget deficit for
the current financial year had shoot up to 6.6%. See ‘PM outlines economic reforms’,
Eye Sri Lanka, 5 November 2015.
439
Danila Berloffa
Business activities were to be further promoted by the establishment

of 11 business and development areas throughout the island – some of
them in the geographical parts more affected by the civil war – and by
the creation of financial and business areas, fitted out both for economic
activities and social development («...they will have schools, hospitals and
highways»).
At the same time, the Prime Minister pointed out the necessity «to
review the tax concessions given to the investors» and announced a policy
aimed at the minimization of regressive taxes. The latter policy was to pur-
sue the medium term aim to bring down to 60%:40% the existing 80%:20%
indirect/direct tax ratio. Both were steps going against the interest of the
business community, although congruent with the general interest.
Concluding the present examination of Wickremesinghe’s speech, it
is necessary to dwell on the fact that, as already noted, in it two different –
some would say contradictory – themes were present: a neoliberal strategy
of economic reforms and the pursuit of social justice. Only the future will
tell if one of the two strands will prevail on the other, or if they will coex-
ist side by side. Also, only the future will tell if Wickremesinghe’s promises
were just only that – heady promises without any concrete follow-up – or a
turning point in Sri Lanka’s history, the beginning of a new phase, not only
in the economic field, but in the political and social ones as well. The fact
that, at the time of writing the present essay, the latter possibility did exist
explains why the present author has dwelt at some length on Wickremesin-
ghe’s «third generation reform» speech.
10.3. Towards the «Third Generation» reforms? The 2015 budget
In closing his 5 November speech, Wickremesinghe claimed that: «The

first budget of our Government presented on the 20th [of November] will
reflect the third generation economic reforms we have planned».117 To a
certain extent this promise was fulfilled, even if the decisions part of the
budget do not – actually could not – be taken as proof that Wickremesin-
ghe’s promises were in the process of being actually translated into concrete
policies. After all, as pointed out time and again by Wickremesinghe in his
speech, most of the promises there made were part of a medium-term pro-
gram, needing some years in order to be implemented.
Budget 2016118 was presented on 20 November by Finance Minister
Ravi Karunanayake in a marathon speech lasting more than four hours.119
117. Indeed it was the first budget presented by the national government.
118. In Sri Lanka, the financial year coincides with the solar year.
119. The full text of Karunanayake’s presentation speech of the 2016 budget is
available in the Sri Lankan Government official site. See Government Of Sri Lanka,
Ministry of Finance, Department of Fiscal Policy, Budget Speeches (http://www.treasury.
440
Sri Lanka 2015
The speech was differently assessed as «a road map for economic re-
forms»,120 as providing «relief to people by reducing the prices of essential
commodities»,121 and as an austerity budget, «in line with the pro-business
demands of the International Monetary Fund».122 At the end of the day,
however, Budget 2016 can be evaluated as characterized by the same ambi-
guities already present in Wickremesinghe’s 5 November speech: strategies
in line with the neo-liberal orthodoxy coexisted with an array of measures
which neo-liberal ideologues would decry as «populist».
On the social front, prices of 11 essential commodities were reduced; a
programme to build 100,000 houses in five years for slum dwellers and low
income groups were announced; new laws to grant ownership of lands and
houses to those who had occupied them for over 10 years were announced;
a series of training and financial measures favouring teachers were made
known. They were to be accompanied by increased investments in education
and health. Moreover, the Finance Minister urged «the private sector employ-
ers to increase the monthly salary by at least Rs.2,500 per month of which
Rs.1,500 per month could be given in 2015 and the balance Rs.1,000 per
month in 2016» [§ 303]. In making his request, Karunanayake pointed out
that the «necessary legislations will be brought in to implement this»[§ 303].
Confirming what had already been said by Wickremesinghe on 5 No-
vember, Karunanayake also officially announced that: «While the govern-
ment has committed to a significant amount of funds for the development
of the war affected areas, we also plan to convene a Donor Conference in
2016, to generate support from bilateral and multilateral agencies to en-
hance the rehabilitation of the North and the East» [§ 507]. In fact, many of
the budget provisions aimed at improving the situation in the war affected
areas, in the North and East of the island, were 70% of the Tamil population
lived. Also, Karunanayake announced the Government’s decision «to ensur-
ing that the issues of the internally displaced people are addressed immedi-
ately.» «In this regard, – stated the Finance Minister – we will initiate a rapid
large scale resettlement programme for the internally displaced people and
provide basic needs and livelihood opportunities to the already resettled
families. In this respect, we will be building 20,000 houses especially in the
Districts of Mannar and Mulativu,123 with proper sanitation facilities, access
to clean water and electricity» [§ 508].
gov.lk/publications/budget-speeches.html). All the quotations given in the chapter

are from this source. As the source is in PDF and the paragraphs are numbered,
direct quotations are followed by the indication between square parentheses of the
relevant paragraph.
120. ‘Full report of Budget-2016’, Dayly Mirror (Sri Lanka), 20 November 2015.
121. ‘People’s Budget’, Sri Lanka News, 21 November 2015.
122. Saman Gunadasa, ‘Sri Lankan government presents austerity budget’,
World Socialist Web Site, 28 November 2015.
123. Both Mannar and Mulativu are in the war-affected Tamil-majority North-
ern province.
441
Danila Berloffa
In consonance with fiscal prudency, Karunanayake announced that the

time had come «to critically analyze and evaluate the expenditure needs of
the line ministries and departments to rationalize unnecessary expenditure
and eliminate excessive administrative overheads» [§ 65]. He also noted that
the «social protection and safety network mechanism» aimed «to protect the
most vulnerable in the society» was «riddled with issues of inefficiency and sub
optimal effectiveness in reaching those who actually require assistance» [§
410]. Hence the Finance Minister decision to review this scheme.124
A main aim of the budget was that of attracting foreign investment.
Accordingly Karunanayake announced «an investor friendly Foreign
Exchange Management Bill (FEMB), which would help attract foreign
flows from the SAARC and the world at large» [§ 199], the removal of
tax on leasing of land to foreigners and the lifting of restrictions on
land ownership by foreigners in the case of selected investments. The
Minister of Finance also assured that any application for foreign invest-
ment would be cleared in 50 days and investors allowed to bring money
to Sri Lanka «through any bank account existing in the formal banking
system» [§ 208].
At the end of the day, and differently from what claimed by some an-
alyst, it is difficult to allege that Budget 2016 imposed «a series of austeri-
ty measures on working people while granting significant concessions for
local and foreign capital».125 Rather, the budget, reflecting the guidelines
set out in the Prime Minister 5 November programmatic speech, was a
complex effort aimed at bringing together measures which could encour-
age both domestic and international capital to invest in the Sri Lankan
economy, while introducing a conspicuous set of measures in support of
the poorer and intermediate strata of the population. In this perspective
it does not come as a surprise that the budget deficit, which in 2015 was
equal to 6%, was brought down of a modest 0.1% to 5.9% in 2016.126
10.4. Taking stock of the economy
During the year under review, weak global demand and domestic
political change adversely affected the economic situation in the island-
state. Investment faltered as investors decided to assume a «wait and
see» attitude. Moreover, the Sirisena-Wickremesinghe administration
cut capital spending and, as noted above, temporarily suspended some
large investment projects approved by the Rajapaksa’s administration.
124. This does not detract from the fact that the total budget allocation for
social spending, amounting to Rs.383 billion, in 2015, in the 2016 budget went up to
Rs.420 billion» [§ 410].
125. Saman Gunadasa, ‘Sri Lankan government presents austerity budget’.
126. Annexure IV, Summary of the budget (2012-2016), Budget Speech-2016.
442
Sri Lanka 2015
In that situation, growth was sustained by an increase in private and

government consumption spending and was led by a 5.3% expansion in
the service sector, the largest one in the Lankan economy.127
In spite of the above listed difficulties, at the closing of the pe-
riod under review, the Sri Lankan economy still managed «a respect-
able growth». In fact the economy expanded 2.5% on a yearly basis in
Q4, namely the fourth quarter of the year, bringing full year growth to
4.8%.128
Of course, all economic difficulties were still there, in particular an
adverse balance of payment and a ballooning debt. Accordingly, only
the future will tell if the new Sri Lanka administration will be able to
progress on a path of social justice and economic growth, pointed out in
Prime Minister Ranil Wickremesinghe’s 5 November speech.
127. Asia Development Bank, Sri Lanka: Economy (http://www.adb.org/coun-

tries/sri-lanka/economy).
128. ‘Sri Lanka Economic Outlook’, Focus Economics (http://www.focus-econom-
ics.com/countries/sri-lanka).
443
pakistan 2015: doMestic and Foreign policY challenges
Marco Corsi
Asia Maior – An Italian think tank on Asia

macorsi@gmail.com
In Pakistan, the period under review (January–December 2015) was characterised

by the overall stable rule of the Nawaz Sharif-headed government of the PML-N
(Pakistan Muslim League-Nawaz) of the Prime Minister. The main challenge to the
Nawaz Sharif government was the internal militancy. The cruelty of the 2013 attack
on an army-run school in Peshawar that killed 149 people, including 132 children,
had started what appeared to be a watershed moment in the savagery of domestic
terrorism. In the period under review, a clear message was sent by the Pakistani in-
stitutions to the perpetrators of the deadly assault and to the militancy in the country
at large: zero tolerance and no more safe havens allowed in Pakistan or Afghanistan.
The special measures taken to fight the militants represented a change of direction
after the initial tendency of the Nawaz Sharif government to engage in dialogue with
the fighters operating in the North West areas of the country.
A similar iron-fist approach was taken by the military-led paramilitary forces in its
effort to fight the violent crime affecting Karachi, the country’s most populous city.
This policy, however, triggered political instability, as the strongest political party in
town was the main target of the crackdown.
Developments in Pakistan-China bilateral relations led to the formalisation of an im-
portant economic agreement for the creation of a trade corridor linking China to the
port of Gwadar in Balochistan. The strategic implications of the accord can be better
understood in the context of the announced disengagement of the United States from
Afghanistan. Moreover, the agreement contributes to explaining Islamabad’s decision
not to support militarily its traditional ally Saudi Arabia in its campaign against
Houthi rebel fighters in Yemen.
Overall stable bilateral relations between Pakistan and India at the highest diplo-
matic level did not prevent tensions from escalating on the international border in
Jammu and Kashmir, where exchanges of fire and civilian casualties were reported,
beginning in the summer of 2015.
1. The domestic challenge: the militancy
The long years of military rule in the country (34, more than half of
its history), which can be divided into four periods, were characterised by
the national governments’ opposition to ethno-national provincial admini-
strations and by the attempt to ensure political stability and economic mo-
dernisation in Pakistan. Ethnic and provincial identities were considered

Marco corsi
as threats to the achievement of these aims, while Islam was promoted as a

means of national integration, which was done in parallel with a centrali-
zation of powers in Islamabad. As a consequence, both the empowerment
of Islamic parties and militant groups (which were allowed unprecedented
power) and the weaponisation of the country became the overall legacy of
the long years of military rule and the distinguishing features of contem-
porary Pakistan. The war on terrorism which followed 9/11 strengthened
these features further. Since then, Pakistani forces have encountered diffi-
culties in maintaining control over the restive tribal regions, from where
Islamic anti-government militants are mostly operating.
On 15 June 2014, the Pakistani army launched a comprehensive ope-
ration called Zarb-e-Azb against local and foreign militants in North Wazi-
ristan. According to the army, the military operation succeeded in ridding
that geographical area from anti-government militant forces. A few months
later, the military also launched Khyber-1, a follow up intervention aimed at
clearing out militant strongholds in the tribal region of Khyber.1
The Islamic fighters’ retaliation was particularly cruel. On 16 Decem-
ber 2014, the Pakistani Taliban attacked an army-run school in Peshawar,
the capital of Khyber Pakhtunkhwa province, killing nearly 150 people,
among whom many were children. The attack triggered widespread outra-
ge both in the country and abroad and the political leadership was put un-
der pressure to take effective measures against terrorism.2 Military action
against militant groups was strongly demanded by the civil society. The
widespread indignation caused by the event gave rise to a unity of purpose
on the part of the political class, the army, and civil society at large. This
resulted in a more resolute and united national effort to address the count-
ry’s security problems and, ultimately, in a more determined approach to
counter-terrorism.
In March 2015, Pakistan launched a fresh operation (Khyber-2) against
terrorists in the Khyber tribal region near the Afghanistan border.3 In the
period under review, the army continued fighting militants belonging to
TTP (Tehrik-i-Taliban Pakistan, an alliance of a dozen groups of insurgents).
A 20-point action plan was launched by the government to counter the
escalating terrorism in Pakistan. A specific measure waiving the existing
moratorium on the death penalty was taken to allow the execution of con-
victed terrorists. Also, special military courts were established for two years
in order to be able to rapidly prosecute and try suspected terrorists. This
was criticised for its implications regarding civil-military relations and, la-
1. Marco Corsi, ‘Pakistan: il nuovo governo di Nawaz Sharif ’, Asia Maior 2013,
pp. 370-373.
2. Ibid.
3. ‘Pakistan to launch fresh offensive against terrorists’, Pakistan News, 25 Febru-
ary 2015.
446
Pakistan 2015
ter in the year, the Supreme Court suspended some of the executions of
terrorists convicted by the military courts.
Other measures were taken to freeze the financial and communica-
tion networks of the terrorist groups. A regulation of the madrasas was
also put on the anvil, as the government pledged to exercise strong control
over the religious seminaries suspected of fostering extremism. References
to the financial support provided by Saudi Arabia to the religious semi-
naries, seen as breeding grounds for religious extremism, had frequently
appeared in the media after the 2013 mass murder in Peshawar. Saudi au-
thorities answered these implicit and explicit accusations by clarifying that
all their donations had been cleared by the government of Pakistan. Iron-
fisted counter-measures aimed at implementing a zero tolerance policy
for militancy were also announced in Punjab, where violence had rapidly
escalated.
Attacks by the TTP, their splinter groups, and other militant organisa-
tions continued in the period under review and were expanded in January
and February 2015 to target minority groups, in particular Shia Muslims
and Christians, in other areas of Pakistan.4 A first attack on a Shia mosque
involved Rawalpindi’s imambargah (a Shia congregation hall for commemo-
ration ceremonies) Aun Mohammad Rizvi in the city’s Chatian Hatian area.
Later, about 40 people were killed and over 50 injured as a blast hit a Shia
mosque during the Friday prayers in Pakistan’s southern province of Sindh
at the end of January 2015. According to the local English newspaper Ex-
press Tribune, a militant group named Jundallah – a Balochistan-based TTP
splinter group which has pledged support to the Islamic State, claimed
responsibility for the attack.
Christian churches were targeted too by the militants. On 15 March
2015, at least 15 people were killed and 70 wounded by bombs which were
detonated near the gates of St. John’s Catholic Church and Christ Church
in Lahore.5 Similarly, on 13 May 2015, about 50 people were killed in Kara-
chi when an armed commando opened fire inside a bus carrying members
of the Shia minority Ismaili community. Again, Jundallah was reported to
have claimed responsibility for the attack.
Another high-profile attack occurred in Attock in August 2015, when
a suicide bomber killed the Home Minister of the Punjab province, Shuja
Khanzada.
4. ‘35 killed in Pakistan Shia mosque blast’, Pakistan News, 30 January 2015.
5. ‘Suicide attacks on Pakistan churches kill 15’, New York Times, 16 March 2015;
‘Deadly blasts hit Pakistan churches in Lahore’, BBC News, 25 March 2015.
447
Marco corsi
2. The paramilitary operations in Karachi
Karachi, the country’s most populous city, which is afflicted by a violent

criminal racket, has been repeatedly targeted by the paramilitary forces’
interventions since the 1990s.6
The current Rangers operation which started in 20137 has led to a si-
gnificant fall in criminal activity, yet it has increased the political instability.
In the period under review, the paramilitary forces predominantly targeted
the members of the MQM (Muttahida Qaumi Movement), the strongest poli-
tical party in town. Bearing responsibility for violent and intimidating acts,
the MQM saw the Karachi party’s premises raided and many of the party
members arrested. Disappearances and killings of MQM-affiliated indivi-
duals were reported throughout 2015. Altaf Hussain, who rules the MQM
from his self-imposed exile in London, was investigated by the British police
over allegations of money-laundering. Hussain, claiming that his party had
been unfairly targeted in the crackdown organised by the Rangers, laun-
ched a campaign against the Chief of Army Staff Raheel Sharif and Prime
Minister Nawaz Sharif. In August 2015, the MQM announced the resigna-
tions of all the party’s members from the National Assembly, the Senate,
and the Provincial Assembly.
The security forces paid similar attention to the PPP (Pakistan People’s
Party), triggering the reaction of Asif Ali Zardari, PPP president and former
President of the Islamic Republic of Pakistan. As a reaction, Zardari threa-
tened to abrogate the PPP’s informal non-aggression pact with the PML-N,
which had been in place since the two parties decided to jointly oppose the
former military ruler General Pervez Musharraf a decade ago.
3. Pakistan and Saudi Arabia
Saudi Arabia’s campaign against Houthi rebel fighters in Yemen,

which began in late March 2015, was coordinated with other Sunni countri-
es. At the end of March 2015, the Saudi-led coalition fighting Yemen’s Shia
Houthi rebels asked Pakistan to contribute soldiers.
Islamabad and Riyadh’s ties are rooted in a partnership which has
been forged over the years and has led to a strong bilateral relationship.
This partnership started to become important when the two countries join-
tly supported the Afghan mujahedeen fighting against the Red Army’s oc-
6. E.g. Marco Corsi, ‘Pakistan: la grande illusione’, Asia Major 1996, pp. 51-58;
Marco Corsi, ‘Pakistan. la contrastata marcia di Nawaz Sharif verso autoritarismo ed
islamizzazione, Asia Major 1999, pp. 191-194; Marco Corsi, ‘Pakistan. un anno nero
per Zardari’, Asia Maior 2010, pp. 125-126.
7. ‘Governor puts his weight behind Rangers operation in Karachi’, Dawn, 9
July 2015.
448
Pakistan 2015
cupation in the 1980s. Later, both countries – and the United Arab Emirates
– recognised the legitimacy of the Taliban regime in Kabul (1996–2001).
Also, the Saudis gave oil to Pakistan in 1998, when the government of Isla-
mabad was hit by international sanctions for conducting a nuclear test.8
The following year, in 1999, the Saudis offered shelter to Nawaz Sharif after
the then Prime Minister was overthrown by the military coup led by Pervez
Musharraf.9
For its part, Pakistan has provided military aid to Saudi Arabia since
the 1960s – including deploying Pakistani combat forces in Saudi Arabia in
the 1970s and 1980s, and providing continual military technical aid.10
After his official visit to Saudi Arabia in March 2015, followed by Na-
waz Sharif ’s visit a few weeks later, Pakistani Defence Minister Khawaja Asif
confirmed Islamabad’s commitment to defending Saudi Arabia’s national
territorial integrity.11
In April 2015, Pakistan, which had backed the Saudi mission against
the Houthis without offering military assistance, debated formally in par-
liament whether or not to contribute militarily to the campaign against the
rebels. Opposition politicians expressed their concerns and called for the
country to be neutral. They stressed that internal terrorism and other pres-
sing domestic and regional issues would make Islamabad’s involvement in
a proxy war between Iran and Saudi Arabia and in a Shia-Sunni conflict in
the Middle East extremely risky.12
The joint session of parliament called by Prime Minister Nawaz Sharif
at the beginning of April 2015, to discuss Saudi Arabia’s request for Pakista-
ni military aid, went on for five days and ended with a unanimous decision
to make use of diplomatic instruments – and diplomatic instruments only
– to bring about an end to the crisis in Yemen. An ensuing parliamentary
resolution on the Yemen crisis urged Pakistan to stay neutral and play a me-
diatory role to resolve the issue. The reference to «neutrality» in the parlia-
mentary resolution generated tensions in the Pakistan-Saudi relationship,
as Riyadh reacted badly to it.13 Yet, as admitted by the Minister for Clima-
te Change and PML-N’s Information Secretary Senator Mushahid Ullah
8. Marco Corsi, ‘Pakistan: modernizzazione senza modernità’, Asia Major 1998,

pp. 206-208.
9. Marco Corsi, ‘Il colpo di stato in Pakistan e le sue conseguenze’, Asia Major
2000, pp. 47-67.
10. ‘Why Saudi Arabia needs Pakistan’, The Diplomat, 12 March 2015.
11. ‘Saudi Arabia asks Pakistan for troops to help fight Houthi rebels in Yemen’,
Deutsche Welle, 6 April 2014.
12. ‘Pakistan’s long history of fighting Saudi Arabia’s wars’, The Washington Post,
27 March 2015.
13. ‘Word «neutrality» cause of Pak-Saudi mistrust’, The News (Pakistan), 12
April 2015; ‘Pakistan has to pay a heavy price: UAE minister’, The News (Pakistan),
12 April 2015.
449
Marco corsi
Khan, Pakistani troops were already deployed in Saudi Arabia to protect the
holy places.14
4. Pakistan-China
In the past few years, the Islamabad-Beijing axis has been progressively
growing in strategic importance in view of the announced disengagement
of the USA from Afghanistan.15 According to some sources, the strategic
links developed by Pakistan with China were also one of the reasons why
the former could afford to decline Saudi Arabia’s requests for support, as
described in the previous section.16
On April 21, the President of the Republic of China, Xi Jinping, vi-
sited Pakistan and pledged 46 billion dollars of support for energy and
infrastructure projects. While the current trade value between Pakistan and
China is relatively low – US$ 9 billion per year – the future economic re-
lations between the two countries are bound to grow by leaps and bounds.
The plans agreed upon during Xi Jinping’s visit to Islamabad represented a
remarkable boost in bilateral relations, particularly in light of the rights won
by a state-run Chinese company to operate the expansion of Gwadar Port as
an economic hub, which was obtained for a period of 40 years.
Gwadar is strategically located in Balochistan, on the shores of the
Arabian Sea, opposite the Gulf of Oman, and in close proximity to the oil
and gas resources of the Gulf countries. For China, Gwadar Port is of both
economic and military strategic interest. It will grant China access to the
Gulf countries, by providing it with the possibility of having a naval base
on the Arabian Sea. According to a plan, formalised during Xi Jinping’s
visit to Pakistan, the port – originally financed and constructed by the Chi-
nese – will become the head of a km 3,000 long economic corridor – the
China-Pakistan Economic Corridor – connecting Gwadar to Kashgar, in
the Muslim majority Xinjiang region of China, via land routes and pipe-
14. ‘Troops already in Saudi Arabia, says minister’, Dawn, 11 April 2015.
15. High-level meetings between Pakistan and the USA were held in 2015 in
Washington. In October, Nawaz Sharif met President Barak Obama, while in Novem-
ber Pakistan’s Chief of Army Staff General Raheel Sharif met Vice President Biden.
These leaders reaffirmed their commitment to continue working together to address
the issues of greatest interest to both nations. ‘2015 Joint Statement by President
Barack Obama and Prime Minister Nawaz Sharif ’, The White House Office of the Press
Secretary, 22 October 2015. ‘Readout of Vice President Biden’s Meeting with Paki-
stan’s Chief of Army Staff General Raheel Sharif ’, The White House Office of the Press
Secretary, 19 November 2015.
16. ‘Pakistan’s switch from «United States Frontline State» to «China’s Front
Line State»’, South Asia Analysis Group, 6 July 2015.
450
Pakistan 2015
lines.17 The idea of the economic corridor began being shaped in 2013,
when Pakistan passed the task to expand Gwadar Port from Singapore Port
Authority to China Overseas Port Holding. It has actually embraced other
existing projects and, due to the economic potential of the port’s deve-
lopment, Chinese banks were interested in funding it and pledged more
than US$ 46 billion.18
The port will play a critical economic role for Pakistan too, allowing the
outflow of goods from Western China and Central Asia, and enriching the
Pakistani exchequer thanks to the port, cargo handling, and freight charges
related to the economic traffic between China and Pakistan.
The development of Gwadar Port has been controversial over the ye-
ars. Balochistan is the poorest province of Pakistan, where basic necessities
are not taken care of; yet it is rich in natural resources and Balochi natio-
nalists have been accusing the federal government of the exploitation and
violation of the province’s rights.19 The port’s development has occurred
in parallel with an upsurge in religious extremism in Gwadar and in the
province at large, while Baloch political parties were opposing the deal with
China and Baloch militant organisations were trying to sabotage the con-
struction work.20 This has worried China, which has alerted the government
of Pakistan; in turn, the government of Pakistan has tried to implement
extra security military measures to protect the increasing number of Chi-
nese personnel involved in the project.21 According to current plans, the
corridor would also cross the Khyber Pakhtunkhwa province and, in case it
is decided that the route should be changed to avoid turbulent areas, the
Baloch and Pashtun areas would be avoided by making the corridor run
through Sindh and Punjab.
5. Pakistan-India
In December 2014 and January 2015, tensions between Pakistan and

India rose over the disputed region of Kashmir. Clashes between security
17. ‘Is China-Pakistan «silk road» a game-changer?’ BBC News, 22 April 2015;
‘China president arrives in Pakistan to sign £30bn «land corridor» agreement’, The
Guardian, 20 April 2015.
18. Athiyan Silva, ‘China invests $46 billion in strategic Pakistan-China Eco-
nomic Corridor’, World Socialist Web Site, 28 April 2015; also, ‘China commits $45.6
billion for economic corridor with Pakistan’, Reuters, 21 November 2014.
19. Marco Corsi, ‘Pakistan: tra nazionalismo e terrorismo’, Asia Maior 2005-
2006, pp. 15-19.
20. ‘Can China’s Gwadar port dream survive local ire?’ The Diplomat, 17 De-
cember 2014; ‘Pakistan’s battle against Balochistan separatists sparks anger and sus-
picion’, BBC News, 6 October 2015.
21. ‘Pak-China corridor: China concerned over Balochistan security’, The Ex-
press Tribune, 23 May 2015.
451
Marco corsi
forces occurred on the border, followed by a meeting of the two countri-

es’ foreign secretaries in March.22 Harsh statements from senior officials
on both sides referring to the alleged involvement of the other country in
sponsoring terrorism escalated the tensions, yet without permanently un-
dermining the high level bilateral relations.
In July 2015, the two premiers, Nawaz Sharif and Narendra Modi, met
at the Shanghai Cooperation Organisation summit held in Ufa, Russia.23
The discussions focused on agreeing to expedite the Mumbai terror attack
trial, and statements aimed at promoting peace and development in the re-
gion and condemning terrorism were issued. An agreement to organise a
meeting of top security advisers to discuss terrorism was achieved, while no
specific reference to the disputed Kashmir region was made, over which In-
dia and Pakistan have conflicting territorial claims. Sharif invited Modi to
attend the annual24 SAARC (South Asian Association for Regional Coope-
ration) summit in Pakistan in 2016 and the Indian Prime Minister accepted
the invitation.25
As a follow up to the Ufa agreement, a meeting of the National Securi-
ty Advisers (NSA) of India and Pakistan, Sartaj Aziz and Ajit Doval, respec-
tively, was scheduled for 23 and 24 August 2015.
However, a few days after the Ufa meeting tensions escalated again
when Pakistan accused India of unprovoked ceasefire violations in Kashmir.
According to the Pakistani Foreign Ministry, on July 18, Indian troops ope-
ned fire in the Poonch area. This was not an isolated event, as skirmishes
had occurred in the previous days and the exchanged gunfire had killed Pa-
kistani civilians. The civilian casualties on both sides led the United Nations
Secretary General Ban Ki-Moon to urge India and Pakistan to resolve their
issues through diplomatic dialogue.
A rise in tensions between the two countries as a result of frequent
violations of the Line of Control (LoC), which continued for the following
months, increased further when the NSA peace talks were cancelled one
day before they were set to begin in August 2015.26 While Pakistan had
reiterated its intention to discuss the disputed Kashmir territory, India had
insisted that the talks focus on terrorism issues only. Eventually, on the eve
of the scheduled NSA meeting, India advised Pakistan against his high com-
22. ‘Top Indian, Pakistani diplomats meet to mend ties’, Reuters, 3 March 2015.
23. ‘India, Pakistan agree to expedite Mumbai terror trial’, Pakistan News, 10
July 2015.
24. The SAARC summits gather together South Asian heads of member states.
Despite what is stated by the SAARC chart, the summits have not been taking place
on an annual basis.
25. ‘Modi accepts Nawaz’s invitation for first Pakistan visit’, The Express Tribune,
10 July 2015.
26. ‘Pakistan cancels talks with India, citing restrictions’, The New York Times,
22 August 2015.
452
Pakistan 2015
missioner in New Delhi meeting with Kashmiri separatist leaders belonging

to the Hurriyat Conference.27 Indian authorities pointed out that India had
never sought dialogue with groups and regions demanding separation from
Pakistan. For their part, the Pakistani authorities answered by highlighting
that the habit of the Pakistan high commissioner in New Delhi to consult
with Hurriyat leaders on the eve of official visits by Pakistani political lea-
ders to India was by then a well-established practice, which had never cau-
sed problems with previous Indian governments. Islamabad also reiterated
that India’s intention to restrict the discussion agenda was evidence of a lack
of any serious intent on the part of New Delhi to engage in meaningful talks
with Islamabad.28
As had happened in 201429 – this time due to the lack of agreement
with respect to the agenda – the meeting of the top security advisers was
cancelled with the two countries blaming each other. This event seemed to
illustrate the gulf between the civil government and the Pakistani military
establishment. Specifically, Sharif seemed to have overestimated his capaci-
ty to influence Pakistan’s India policy in line with the desiderata of the Paki-
stani business community. The latter would welcome increased engagement
with India, which would be beneficial to the Pakistani economy. Pakistan’s
India policy, however, remains strictly controlled by the army, which appears
suspicious of any thaw in the relations with India.
In September 2015, following talks between the Director Generals of
the Pakistani Punjab Rangers and India’s Border Security Force held in New
Delhi, the two parties agreed to observe the ceasefire along the LoC and to
de-escalate tensions through a set of confidence building measures.30 Yet,
just a few days later, skirmishes erupted again across the de facto border and
casualties were again reported.31
27. The APHC (All Parties Hurriyat Conference) is an alliance of multiple or-
ganisations (political, religious, etc.) striving to raise the cause of Kashmiri’s right to
self-determination (http://www.huriyatconference.com).
28. ‘Pakistan regrets Indian pre-conditions for NSA talks: FO’, The News (Pa-
kistan), 21 August 2015; ‘Pakistan declines to hold NSA talks based on India’s pre-
conditions’, Ari News, 22 August 2015; ‘NSA talks: India restricting agenda, says
Pakistan’, Deccan Chronicle, 22 August 2015; ‘NSAs’ talks cancelled over Indian condi-
tions’, Dawn, 23 August 2015.
29. Marco Corsi, ‘Pakistan: gli attacchi al governo di Sharif e le tensioni con i
militari’, Asia Maior 2014, p. 379.
30. ‘Pakistan, India agree on ceasefire at working boundary’, The News (Paki-
stan), 13 September 2015.
31. ‘Indian aggression: unprovoked firing kills Pakistani soldier at LoC’, The
Express Tribune, 16 September 2015.
453
Marco corsi
6. Economy
Pakistani average growth rate for the last five years has been 2.9%.
During the same period, inflation has remained steady at 7.9%.32 Pakistan’s
economic growth for the financial year 2015, which ended on 30 June 2015,
was mainly driven by services. Manufacturing and industrial growth slowed
down due to reduced external demand. Power shortages also contributed to
the setback, debilitating the industrial sector.33
The federal budget for the fiscal year 2015–16 was presented on 31
June 2015. Its total outlay was 4,451.3 billion rupees (about US$ 42 mil-
lion), 3.5% higher than the 2014-15 budget.34 The main internal source of
income was the provinces’ revenues and taxes. The budget introduced me-
asures focused mostly on fighting tax evasion, increasing tax revenues and,
nominally, trying to save the poorest segments of society from new taxes.
The long awaited increase in the government employees’ salaries was not si-
gnificant, being 7.5%.35 External sources of income, mainly loans, increased
by 12.1% compared to the 2014–15 budget.
The government announced incentives for the agricultural sector to
boost agricultural production in the country. A health insurance scheme (9
billion rupees, about US$ 85 million) was launched to provide insurance
for patients suffering from serious diseases. The targeted growth rate was
fixed at 5.5%, more than a 1 percentage point increase over the previous
financial year.36
Last but not least, 781 billion rupees (about US$ 7.5 billion) were allo-
cated for expenditures on defence, representing an increase of 11.16% over
the previous fiscal year.37
32. ‘Pakistan Economic Survey: Two years of growth and several missed tar-
gets’, Dawn, 6 June 2015.
33. E.g. ‘Economy growth: Pakistan set to miss target for second year’, The
Express Tribune, 19 May 2015; ‘Manufacturing in the doldrums’, Dawn, 5 June 2015;
‘Large scale manufacturing posts 3.3 percent growth in FY15’, The News (Pakistan), 20
August 2015; ‘Growth of large-scale manufacturing slows down to 2.2%’, The Express
Tribune, 21 November 2015.
34. Government of Pakistan, Finance Division, Federal budget 2015–16. Budget
in brief (http://www.finance.gov.pk).
35. Ibid.
36. Ibid.
37. Ibid.
454
aFghanistan 2015: the national unitY governMent at work.
reForMs, war, and the search For stabilitY
Diego Abenante
University of Trieste
diego.abenante@dispes.units.it
The end of the Karzai era and the establishment of a coalition government were the
most important events of 2015 in Afghanistan. After the disputed 2014 presidential
election, Ashraf Ghani and Abdullah Abdullah signed an agreement for the formation
of a government of national unity. On this basis, Ghani took office as President, while
Abdullah was appointed Chief Executive Officer, a position that corresponds roughly
to that of a prime minister. Despite high expectations, the government faced enormous
difficulties because of the disagreement between the two leaders. This division also cha-
racterized the reform agenda, which was an integral part of the 2014 deal. Ghani
and Abdullah pledged to change the electoral system and to reform the Constitution.
However, the two leaders have found themselves in disagreement on the contents of the
reforms, particularly in relation to the electoral system. The dispute has therefore caused
a climate of political uncertainty. Meanwhile, the military situation has deteriorated
because of the intensification of the offensive of the Taliban. The military mission «Re-
solute Support» has seen the international forces reducing their activity to a consulting
and training role. This has highlighted the weakness of the Afghan National Army.
However, in mid-2015 the Taliban faced an unexpected internal crisis, with the death
of their leader, Mullah Muhammad Omar. With regard to foreign relations, Ghani
successfully sought to re-establish positive relations with the United States, and vigo-
rously pursued the peace process. The two main changes in this regard were the search
for a direct approach with Pakistan and the formal inclusion of China – along with the
United States – in what has become the «Quadrilateral Approach» to the peace process.
Finally, this essay summarizes the evolution of the Afghan economy, which appears once
again to be conditioned by the uncertain political framework and by the negative effects
of reduced foreign military presence, despite an improvement in tax revenue.
1. Introduction
The end of the Karzai era and the establishment of a coalition go-
vernment in Afghanistan dominated 2015. After the highly disputed 2014
presidential election, Ashraf Ghani and Abdullah Abdullah signed a deal
which provided for the formation of a National Unity Government (NUG).
According to the agreement, Ghani was appointed President, while Abdul-
lah was sworn in as the Chief Executive Officer (CEO), a newly-created po-
sition corresponding to that of a prime minister. However, the deal did not
bring to an end the political confrontation. Despite the solemn pledges of
political unity made by the two leaders, the government has faced great dif-

Diego AbenAnte
ficulties in agreeing on basically all political choices. The formation of the

cabinet had to wait until the end of 2014, but the key position of Minister of
Defence has been left in the hands of an acting minister due to the lack of
consensus on the appointment. Such disagreement also characterized the
agenda of reforms, which was included in the 2014 deal. The two leaders
made a commitment to change the electoral system in time for the new par-
liamentary elections, which were due to take place in the summer of 2015.
Moreover, they committed themselves to reforming the Constitution, in or-
der to replace the presidential system with a parliamentary one. However,
since the beginning of the government, the two leaders have shown very
different approaches towards the agenda: while President Ghani appeared
reluctant to take concrete steps, Abdullah was much more active, showing
signs of impatience at Ghani’s apathy. The confrontation between the two
leaders caused a serious political impasse, which led many observers to ex-
press doubts about the capacity of the NUG to deliver political stability. In
the meantime, the military situation deteriorated due to the intensification
of the Taliban’s offensive. The start of the «Resolute Support Mission» in
January 2015 resulted in the international forces downgrading their activity
to an advisory and training role. As widely expected, these circumstances
highlighted the weakness of the Afghan National Army (ANA) and its ina-
dequacy in taking on the task of leading the war against the Taliban. Howe-
ver, in mid-2015 the insurgents faced an unexpected internal crisis, with the
announcement of the death of their leader Mullah Muhammad Omar. The
loss of the charismatic mujahidin commander led to a struggle for succession
within the Taliban which has affected their unity and strength.
On the foreign policy front, President Ghani successfully tried to re-
establish positive relations with the US, and eagerly pushed forward the pe-
ace process, as promised during the electoral campaign. The two main de-
velopments in this regard were the President’s initiative to directly approach
Pakistan in bilateral talks, and the formal inclusion of China, together with the
US, in what has become the «Quadrilateral approach» to the peace process.
Finally, in the year under review, the political uncertainties and the
withdrawal of the international military forces adversely affected the eco-
nomy, which nevertheless recorded, overall, a slight improvement.
2. The NUG and the reform agenda
The results of the presidential elections largely determined the poli-

tical developments in 2015.1 The September 2014 deal signed by the two
1. Martin van Bijlert, ‘Electoral Reform, or Rather: Who Will Control Afghani-
stan’s Next Election?’, Afghanistan Analysts Network, 17 February 2015. See also Diego
Abenante, ‘Afghanistan 2014: Political Transition without Democracy?’, Asia Maior
2014, pp. 392-94.
456
AfghAnistAn 2015
main contenders, Ashraf Ghani and Abdullah Abdullah, was not merely a
power-sharing plan. Besides the distribution of the governmental posts, the
deal included a plan for the reform of both the Constitution and the elec-
toral system. The statement issued by the two leaders at the time declared
a change in the Afghan political system with the introduction of the post of
«executive prime minister» – therefore modifying the current presidential
system – as one of the main purposes of the agreement.2 The deal also
established a two-year deadline for the convocation of a constitutional Loya
Jirga (traditional grand assembly). Such a decision had delicate political
consequences, because it implied that the CEO – the role held by the oppo-
sition leader Abdullah – was an interim figure, and he would have to give
up his position within two years. The fact that the two leaders had agreed
on a form of government was in itself an important achievement, given the
country’s political history. In fact, the non-Pashtun communities –, which
were for the most part Abdullah’s supporters – never quite accepted the
presidential form of government, which was decided on at the 2001 Bonn
conference at the insistence of both the Pashtun majority and of the US.3
However, the more complex point of the government’s agenda turned
out to be the electoral reform. Although described in the post-election joint
statement as a necessary step «to ensure that future elections are fully cre-
dible», it became soon the real point of contention between Ghani and Ab-
dullah.4 The dispute concerned the result of the last elections. According to
Abdullah, the elections were largely marred by fraud, and the responsibility
for this lay with the electoral bodies: the Independent Electoral Commis-
sion (IEC) and the Independent Electoral Complaints Commission (IECC).
Therefore, the changes Abdullah and his supporters had in mind involved
a radical reform of the two institutions. In February 2015, Asef Ashna, the
deputy spokesman of the CEO, stated that «the (electoral) reforms include
the dismissal of the commissioners of the election commissions, who have
upset the elections and who are responsible for damaging the people’s trust
in a democratic process».5 As expected, this statement caused a strong re-
action on the part of the electoral commissioners. Not only did they refuse
to be held responsible for the problems of the last elections, but also in-
2. ‘The «government of national unity» deal (full text)’, Afghanistan Analysts

Network, 2014.
3. The Pashtuns, being the most numerous ethnic group in Afghanistan (ap-
proximately 42% of the population, according to the CIA World Factbook), wanted a
presidential system, which was favoured also by the US. Of course, the other ethnic
groups saw the presidential system as strengthening the Pashtuns and, accordingly,
much preferred a parliamentary system.
4. The agreement was also signed by the Special Representative of the UN
Secretary General Jan Kubis and by the US Ambassador James B. Cunningham. See
Ibid.; David Loyn, ‘Afghanistan’s attempts to reform voting face failure’, BBC News,
14 February 2015.
5. Quoted in Martine van Bijlert, ‘Electoral Reform, or Rather: Who will Con-
trol Afghanistan’s Next Election?’, Afghanistan Analysts Network, 17 February 2015, p. 5.
457
Diego AbenAnte
sisted that the reform of the system was their own business, claiming that
the government had no authority to interfere.6 Unsurprisingly, the election
commissioners found an ally in the President and his supporters. In fact,
Ghani rejected Abdullah’s demand of a reshuffle of the IEC and the IECC,
and insisted that the reform had to be limited to the electoral rules. Signi-
ficantly, while Abdullah ignored the IEC and IECC in preparing his own
proposals, Ghani had a meeting with the IEC commissioners and listened
to their proposals.
3. Why were the reforms so important?
There was more than one reason that caused the President and his cir-
cle of supporters to be so cautious about revising the electoral commissions
and the electoral matter at large. First, a replacement of the IEC and of the
IECC might be interpreted by the public as an admission that the vote had
been marred by fraud. This would have undoubtedly damaged the Presi-
dent’s image and strengthened his opponent’s. Secondly, the choices made
about the electoral system would have relevant consequences for the future
Constitution. As we noted above, the reform of the Constitution required
the convening of a Loya Jirga. However, the formation of the Loya Jirga was
to be preceded by the election of the new parliament and district councils;
according to article 110 of the Constitution, more than 85% of the Jirga’s
members should be elected from a pool of delegates chosen by those assem-
blies.7 In short, prevailing in the future Parliament would be a necessary
step in order to acquire a majority in the future Loya Jirga, and therefore to
influence the reform of the Constitution. The consequence of this was that
all political actors were determined to play a role in the electoral reform.
With these premises, it is easy to understand why the reform agenda became
an arena of contention between the two main factions, and between the two
main factions and all of the other minor groups that wanted to play a role
in Afghan politics.8
To make things even more complex, the Afghan electoral schedule
required that the parliamentary and district council elections be held not
later than 23 June 2015; that is, before the end of the Wolesi Jirga’s (the
lower chamber’s) term. Although the February 2015 joint declaration by
the President and the CEO stated that no further elections would be made
without the reform, it soon became evident that only a miracle would allow
the process to be completed in time. According to the September 2014 agre-
6. Ibid.
7. Ibid.
8. Ehsan Qaane & Martine van Bijlert, ‘Elections in Hibernation: Afghanistan’s
Stalled Electoral Reform’, Afghanistan Analysts Network, 17 June 2015, pp. 1-8.
458
AfghAnistAn 2015
ement, «immediately after the establishment of the NUG», the President

would appoint a special commission for the reform of the electoral system.
In reality, it took as long as five months for Ashraf Ghani to sign the ne-
cessary decree. Unsurprisingly, the President’s inaction aroused anxiety in
Abdullah and his supporters, who began casting doubts on the President’s
real intentions. In January, the CEO began moving on his own path. His
representative announced the drafting of two proposals; one to amend the
electoral laws and to establish an anti-fraud mechanism, and a second one
to modify the electoral system with the introduction of a quota of propor-
tional representation.9 The Parliament also decided to take the initiative:
although article 109 of the Constitution forbids the Wolesi Jirga from amen-
ding the electoral laws during its last year of office, the assembly started di-
scussing amendments to various articles of the law on electoral bodies. The
prevalence of CEO’s supporters in the parliamentary commissions – not
surprisingly – led to amendments that were very close to Abdullah’s views,
which added new fuel to the confrontation.10 These developments empha-
sised once more the extreme fragmentation of the Afghan institutions and
the lack of consensus among the political forces.11
In February, the President reacted by trying to take control of the pro-
cess. First, he launched a consultation with the IEC and the civil society
on the electoral laws; two months later, he appointed – without consulting
the CEO – a chairperson to the special commission for the reform of the
electoral system.12 The news caused a new conflict, given that the person
nominated by the President – Shukria Barakzai – had been a member of
Ghani’s electoral team, which obviously led the CEO’s circle to cast doubt
on her impartiality. The deputy spokesperson of the CEO went so far as
to accuse Barakzai of being involved in «large-scale fraud» during the past
election.13 As was largely expected, the confrontation made it impossible to
complete the reform according to the constitutional schedule. Unsurpri-
singly, the international actors followed these events with growing concern.
In May, they decided to put some pressure on Kabul, and announced the
«end (of) their financial cooperation» with the Afghan electoral institutions
due to the lack of reforms.14 Given that the international donors financial-
ly supported about 80% of the IEC budget, including the salaries of the
electoral commissioners, their decision to withdraw from the process meant
bringing to a halt the electoral machine. The donors’ initiative was decisive
9. Martine van Bijlert, ‘Electoral Reform’, p. 2.

10. Ibid., pp. 3-4.
11. ‘The Challenging Electoral Reforms Process’, The Daily Afghanistan, 28 De-
cember 2015.
12. Ehsan Qaane & Martine van Bijlert, ‘Elections in Hibernation’, p. 3.
13. Ibid.
14. ‘International Donors Pull Funding for Election Commissions’, Tolonews,
11 May 2015.
459
Diego AbenAnte
in ending the stalemate; after more than three months of negotiations, in

July 2015, Ghani announced the appointment of Sultan Shah Akefi as the
new chairperson of the commission. An academic belonging to the Haza-
ra community, and with extensive experience in parliamentary work, Akefi
was acceptable to the opposition. In addition, the President appointed the
other 14 members of the body—seven names from each party—including
the UN Deputy-Special Representative for Afghanistan as the 15th compo-
nent without voting rights.15 The international partners reacted with relief
to the news, and invited the government to announce an electoral calendar
as soon as possible.16
However, great obstacles remained along the way. Apart from the tech-
nical complexity of the reform itself, the organization of the district council
elections was not an easy task. The main reason was that these elections
had never been held in the past; therefore, a complex work of boundary
definition and the gathering of population statistics were required. Not sur-
prisingly, the previous governments had decided to cancel the plans to hold
district council elections together with other polls.17 In any case, the special
commission seemed to act efficiently. Starting work in late July, after one
month it submitted a list of proposals to the President and to the CEO.18
The draft proposals included a correction of the electoral system with the
introduction of a quota of parliamentary seats (85 out of 250) allocated
through proportional representation; the creation of a voter’s identification
system; and the division of the provinces into smaller electoral constituen-
cies. Having been discussed for years, the proposals were not new; howe-
ver, their publication caused a new dispute between Ghani and Abdullah,
because some of the former’s supporters viewed the draft as too close to
the CEO’s views. For example, the head of the IECC, Abdul Sattar Saadat,
already at the centre of the 2014 electoral dispute and considered close to
the President, described some of the proposals as «illegal», and stated that
their acceptance would amount to admitting the illegitimacy of the previous
presidential election.19 On the other side, Abdullah was quick in lauding the
work of the Commission, while Ghani himself remained silent.
Apart from the parties’ strategies, the introduction of a proportional
quota would undoubtedly be a revolution for the Afghan political system.
15. Shakeela Ibrahimkhail, ‘President, CEO Agree to Appoint New Head of

Electoral Reform Commission’, Tolonews, 20 April 2015; ‘President Ghani Appoints
Electoral Reform Commission Chief and Members’, Khaama Press, 16 July 2015.
16. ‘Unama Welcomes Establishment of Electoral System Reform Commission,
Calls for Electoral Calendar’, UNAMA-United Nations Assistance Mission in Afghanistan,
19 July 2015.
17. Martine van Bijlert, ‘Electoral Reform’, p. 7.
18. Muhammad Hassan Khettab, ‘Electoral Reform Panel Officially Starts
Work’, Pajhwok Afghan News, 22 July 2015.
19. Mujib Mashal, ‘Afghanistan’s Electoral Reform Plan Is Met With Skepti-
cism’, The New York Times, 31 August 2015.
460
AfghAnistAn 2015
Not only would it reinforce the political parties’ influence at the expense of
the independent parliamentarians, but it would also force the Kabul politi-
cians to look for candidates able to mobilize the vote banks in the provinces,
therefore changing the balance of power between the capital and the pro-
vinces. In any case, the complexity of the task, and the failure of the attempt
to build a political consensus, made delaying the parliamentary election
an unavoidable choice. By June, the President had already issued a decree
extending the term of the parliament until the holding of fresh elections.20
In late December, Ghani announced that the elections would be postponed
until 15 October 2016.21
4. The deteriorating military situation
Since the formation of the NUG, the insurgency has intensified its
offensive against the government. The pressure by the Taliban began in
February and reached its apex in September/October. Significantly, in
2015 the Taliban did not interrupt—except in Kabul—the military opera-
tions at the beginning of the winter season, as they had done in the past.
The higher intensity of the fighting was also due to the reduction of the
international allies’ activity to a training and advisory role, which allowed
the insurgents to engage the Afghan armed forces in open battles. As a
result, the geography of the war changed during 2015, with the Taliban
extending their offensive to provinces that had been relatively peaceful in
the past, principally in the Northern areas. Of particular importance has
been the capture by the Taliban of the city of Kunduz, which was recovered
by the ANA two weeks later, only thanks to the deployment of US Special
Forces and air support.22 The fall of Kunduz to the insurgents was a shock
for the Afghan public, since it was the first time since 2001 that the Tali-
ban occupied an urban area. Moreover, Kunduz was far from the territory
under Taliban influence, being disconnected from their support networks
in Pakistan. The strategic position of the city, near to the Tajikistan border,
contributed to spreading insecurity through the Northern provinces.23
20. ‘Afghan Leader Extends Parliament’s Term, Promises Election Date’, Reu-
ters, 19 June 2015.
21. ‘Afghanistan to Hold Delayed Parliamentary Elections in October’, Reuters,
31 December 2015.
22. Lailuma Noori, ‘Afghanistan’s Major Events in 2015’, The Kabul Times, 2
January 2016; ‘Afghanistan: Country Summary’, Human Rights Watch, January 2016,
pp. 1-3.
23. Antonio Giustozzi & Ali Mohammad Ali, ‘The Afghan National Army After
ISAF’, AREU-Afghanistan Research and Evaluation Unit, Briefing Paper Series, March
2016, p. 2; Emma Graham-Harrison, ‘However Long it Lasts, Taliban Capture of
Kunduz is a Major Blow to Afghan Government’, The Guardian, 29 September 2015.
461
Diego AbenAnte
Moreover, with their attack on Kunduz, the insurgents showed the capacity
to penetrate regions that had been considered centres of anti-Taliban ac-
tivity. The insurgents also conducted large-scale military operations in the
South, particularly in the Helmand and Uruzgan Provinces, and launched
attacks against civil targets, like the airports of Kabul and Kandahar and
even the national Parliament.24
Although the Taliban rarely established stable control of these terri-
tories, these events augmented their confidence, while increasing the fee-
ling of insecurity among the population. During the year under review, the
Afghan National Security Forces (ANSF) continued to register a very high
number of casualties, which increased by 70% in the first 15 weeks of the
year, compared to the same period in 2014; a rate that former US com-
mander, Gen. Joseph Anderson, described as «not sustainable».25 Despite
the unavailability of exact data, many observers have considered the year as
the bloodiest since 2001.26 Moreover, the confidence shown by the Taliban
increased the perception that they can still prevail in military terms, which
has made political reconciliation more arduous.27
These developments obviously emphasised the difficulties for the ANA
in leading the military operations against the insurgents, following the re-
duction of the ISAF (International Security Assistance Force) role under
the «Resolute Support Mission». There was certainly an expectation that
the change in military responsibilities would lead to a weakening of ANA
control in the rural areas, and therefore a growing threat to the cities. Ho-
wever, the speed of the process and the inability of the ANA to maintain a
hold on the territory surprised many analysts.28 According to well-informed
sources, for the first time since 2001 the ANA has begun having problems
with recruitment. The army is also suffering both from the withdrawal of
foreign advisers at unit level, and from a weakness of equipment and logi-
stics.29 The high casualties suffered and the lack of major victories have also
created a low morale in the troops, which was reflected in desertion and
«ghost soldiering» (troops that are included on the soldiers’ list, but who are
not serving).30 The decision by the President to augment the salaries of the
24. Lailuma Noori, ‘Afghanistan’s Major Events in 2015’.

25. Franz-Stefan Gady, ‘Afghan Forces are Suffering Record Losses’, The Diplo-
mat, 5 May 2015; Azam Ahmed, ‘Misgivings by U.S. General as Afghan Mission Ends’,
The New York Times, 8 December 2014.
26. Vanda Felbab-Brown, ‘Blood and Hope in Afghanistan: A June 2015 Up-
date’, Brookings Institution, 26 May 2015, p. 1.
27. Emma Graham-Harrison, ‘However Long it Lasts’.
28. Antonio Giustozzi & Ali Mohammad Ali, ‘The Afghan National Army’, cit.,
p. 15.
29. Ibid., pp. 7-10.
30. Joseph Goldstein, ‘Afghan Security Forces Struggle Just to Maintain Stale-
mate’, The New York Times, 22 July 2015.
462
AfghAnistAn 2015
army was also a demonstration that the NUG was aware of the problem.31
Another serious issue was the inability of the government to improve the
mechanism of appointments based on merit. Contrary to the announce-
ments of the NUG, politicization and patronage still condition the careers
of the military, causing a serious adverse impact on ANA morale.32
In this context, it is not surprising that Ashraf Ghani, during his first
official visit to Washington in March, formally asked the US administra-
tion to freeze the plan of withdrawal of troops from Afghanistan, a request
that the US President accepted.33 The decision of the Obama administra-
tion was also based on other elements, besides Kabul’s request. The most
important was the resilience of al Qa‘ida in the border region between Af-
ghanistan and Pakistan. Although considered moribund, according to re-
liable sources the Islamist network was still active in 2015 in the mountai-
nous tribal areas, despite repeated operations by the US Special Forces.34
The second reason was the emerging evidence on the infiltration of the
so-called Islamic State’s Wilayat Khorasan (namely the «Khorasan provin-
ce», Khorasan being a region in Eastern Iran) into the eastern region of
Afghanistan.35 Finally, the decision by the Obama administration to main-
tain «flexibility» on troops’ deployment was linked to the needs of the CIA
and of the Special Forces to operate in two large military bases at Kan-
dahar and Jalalabad. Washington has therefore redefined its initial plan
of withdrawal in order to maintain about 10,000 troops in Afghanistan,
which the US officials consider the minimum useful force.36 Still, disagre-
ement exists between the Afghan and American actors – as well as between
US officials – about the future prospects of American military presence in
the field. While President Obama has promised to withdraw all US troops
by the end of 2016, Ashraf Ghani – aware of the ANA’s weakness – has
insisted on a protracted US military presence. Apparently some of the US
staff also shared that fear; according to them, the Afghan scenario after
a complete US pull-out would resemble too closely the post-1989 period,
when the Islamist insurgency was quick to occupy the political vacuum.37
31. Antonio Giustozzi & Ali Mohammad Ali, ‘The Afghan National Army’, pp.
3-14.
32. Ibid., p. 11.
33. Michael D. Shear & Mark Mazzetti, ‘U.S. to Delay Pullout of Troops from
Afghanistan to Aid Strikes’, The New York Times, 24 March 2015; ‘Afghan President
Ghani Credits US Role During First Washington Trip’, BBC News, 23 March 2015.
34. Michael D. Shear & Mark Mazzetti, ‘U.S. to Delay Pullout’; Vanda Felbab-
Brown, ‘Blood and Hope’, p. 4.
35. Antonio Giustozzi & Silab Mangal, ‘A Gathering Storm? The Islamic State
Campaign in Eastern Afghanistan’, Jane’s Terrorism & Insurgency Monitor, 13 Novem-
ber 2015, pp. 1-9 (http://www.janes.com/security/terrorism-insurgency).
36. Vanda Felbab-Brown, ‘Blood and Hope’, p. 4.
37. ‘Afghan President Ghani Credits’.
463
Diego AbenAnte
5. The power struggle within the Taliban
The apparent position of strength of the insurgents came under scru-

tiny in mid-2015 when, after many unconfirmed reports, Kabul’s National
Directorate of Security (NDS) – the Afghan intelligence agency – revealed
that Mullah Muhammad Omar, the charismatic leader of the Taliban, had
died, apparently, in 2013. After two days of silence, the Taliban official
sources confirmed the news, and, at the same time announced the appoin-
tment of Mullah Omar’s deputy, Mullah Akhtar Muhammad Mansour, as
the new Taliban leader.38 The loss of the acknowledged leader inflicted a
tremendous blow to the movement, given that Mullah Omar was perhaps
the only unifying force in a traditionally fragmented movement. In fact,
not all the factions accepted the appointment of Mullah Mansour; some
founded a parallel organization under the leadership of another veteran
mujahidin commander, Mullah Muhammad Rasul. The actual balance of
forces between the two leaders was difficult to ascertain, given that the esti-
mates were often politically motivated. According to US diplomatic sources,
about 80-90% of the movement supported Mansour, while the rest of the in-
surgents were loyal to Rasul. However, Taliban sources suggested that Man-
sour had a much more limited strength of about 55-60% of the Taliban.39
While the struggle of power inside the movement did not generally affected
their ability to fight, it nonetheless emphasised their internal rivalries and
divergent opinions on a variety of topics, which may be the sign of a possi-
ble fracture in the movement. Moreover, the attempt by the Islamic State to
penetrate the Af-Pak region created a further alternative to Mansour, with
some of the disappointed field commanders and rank-and-file declaring
their allegiance to the «Islamic State», in open disagreement with the cur-
rent Taliban leadership.40
More importantly, the two sides showed different attitudes towards the
issue of reconciliation with the NUG. Akhtar Mansour has been known for
years as one of the most pragmatic and pro-dialogue Taliban commander-
s.41 This was confirmed by his role in the opening of the Taliban «political
office» in Qatar in 2013, as well as by his support – though with scarce
enthusiasm – of the peace initiative launched under Pakistani guidance in
Murree (in the Pakistan province of Punjab) in July 2015.42 On the other
38. Thomas Ruttig, ‘From Mullah Omar to Mansur: Change at the Top of the
Taleban’s Top Leadership’, Afghanistan Analysts Network, 31 July 2015, pp. 1-5.
39. Antonio Giustozzi & Silab Mangal, ‘An Interview with Mullah Rasool on
Reconciliation Between the Taliban and the Afghan Government’, The Royal United
Services Institute, 16 March 2016.
40. Daud Qarizadah, ‘Afghan Taliban: Mullah Mansour’s Battle to be Leader’,
BBC News, 23 September 2015.
41. Borhan Osman, ‘The Murree Process: Divisive Peace Talks Further Com-
plicated by Mullah Omar’s Death’, Afghanistan Analysts Network, 5 August 2015, p. 2.
42. Ibid., pp. 1-6; Thomas Ruttig, ‘From Mullah Omar to Mansur’, p. 6.
464
AfghAnistAn 2015
side, Mullah Rasul rejected the attempts to negotiate with the NUG made
by Mansour, accusing him of pursuing «personal interests».43 However, dif-
ferences within the Taliban are much more fluid than they may appear on
the surface, and well-informed sources emphasise that differences of opi-
nions regarding whether to negotiate – and under which conditions – exist
on both sides, as well as in the other Taliban splinter groups. Mullah Ra-
sul himself, while condemning the Murree Process, has emphasised that
he is not against «reconciliation in principle»; rather that he is opposed to
Mansour’s control over the negotiation. Mullah Rasul has publicly insisted
that reconciliation must not sacrifice basic Taliban «principles», such as the
insertion of more shari‘a norms into the Afghan Constitution, and the pre-
liminary withdrawal of all Western soldiers from Afghanistan. Interestingly,
Rasul has also criticized the current state of the reconciliation process, based
on the «Quadrilateral approach»; that is, on the participation of the US,
China and Pakistan, with the exclusion of Iran.44 While the appointment
of Mullah Mansour has undoubtedly kept the door open for negotiation, it
has also had a divisive effect on the Taliban groups, which, in turn, has pa-
radoxically made negotiating more difficult. Moreover, Mansour’s need to
reassure the movement of his unwillingness to negotiate at all costs explains
the dramatic increase in violence during the autumn.
6. Ghani’s foreign policy
The most obvious change with the passage of the presidency from
Karzai to Ghani was probably recorded in foreign policy. First, Ghani wor-
ked hard at reversing the Afghan-US relations, which had reached their
lowest point during the last months of the Karzai era, with the latter’s re-
fusal to sign both the Bilateral Security Agreement (BSA) with the US, and
the Status of Forces Agreement (SOFA) with NATO. Significantly, one of
President Ghani’s first acts was to sign both treaties.45 Moreover, whereas
Karzai based its political action in recent years on a stronger nationalist
sentiment, exploiting the existing discontent among the population caused
by the US bombings’ civilian victims, the nationalistic anti-US rhetoric all
but disappeared with Ghani’s election. When the President visited Washing-
ton in March, he thanked the US soldiers who fought in Afghanistan, and
the US government for its military and financial support.46 This «different
relationship» was acknowledged by the US officials, who described Ghani
as «more cooperative» than his predecessor.47 On the other hand, Ghani’s
43. Antonio Giustozzi & Silab Mangal, ‘An Interview with Mullah Rasool’, p. 2.
44. Ibid.
45. Diego Abenante, ‘Afghanistan 2014’, p. 384.
46. ‘Afghan President Ghani Credits US Role’.
47. Ibid.; Vanda Felbab-Brown, ‘Blood and Hope’, pp. 2-5.
465
Diego AbenAnte
cordial tone towards the US is easily understood in the light of his extreme
need for continued military support, as noted above. The second new aspect
was Ghani’s initiative – supported also by Abdullah – to directly address Pa-
kistan about reviving the peace process with the Taliban. This in fact was
not a true innovation, in that it reflected a widespread belief among Afghan
politicians – often repeated by Karzai in the past – that the Taliban are con-
trolled by Islamabad, or at least that Pakistan may persuade the Taliban to
sit at the negotiating table.48 This vision – which probably overestimates the
strength of Pakistan vis-à-vis the Taliban – stems, among other factors, from
a vision of the war as a conflict between states (that is, Afghanistan and Pa-
kistan), rather than between different components of Afghan society.49 That
there has been a tendency on the part of Kabul and the US to overestimate
the role of Pakistan in controlling the Taliban – or most of them – has been
shown by the complex events of the Murree Process, that is, the negotiation
conducted in summer 2015 under the auspices of Pakistan.50 Well-informed
sources suggest that the negotiation has actually been imposed on the Tali-
ban by Islamabad, with the consequence of creating a rift between some of
the Taliban commanders and the Pakistani civilian and military authorities.
The result has been that, so far, the process has had limited results.51 That
said, it has to be recognized that the NUG have energetically carried on the
attempt to build a new confidence in relations with Islamabad, also taking
advantage of Nawaz Sharif ’s new government in Pakistan, an attempt which
has been acknowledged by Islamabad.52 Regardless of whether Pakistan
does or does not have the power to control the Taliban, there is no doubt
that peace in the region must come from a change in relations between the
two neighbouring states.53
7. The economic situation
The political uncertainties and the withdrawal of international military

forces affected the economic results of 2015. The political impasse caused
by the reform difficulties and the military situation have counterbalanced
the positive effect of the formation of the NUG. Accordingly, the economic
improvement during the year under review has been modest when compa-
48. Borhan Osman, ‘The Murree Process’, pp. 9-10.

49. Ibid., p. 8.
50. Ismail Khan, ‘Afghan Government, Taliban, Resume Peace Talks in Murree
on Friday’, Dawn, 29 July 2015.
51. Borhan Osman, ‘The Murree Process’, pp. 7-8.
52. Rod Nordland & Mujib Mashal, ‘Afghan President Receives Unexpected
Welcome in Pakistan’, The New York Times, 9 December 2015.
53. See ‘Resettling Pakistan’s Relations with Afghanistan’, International Crisis
Group, Asia Report N° 262, 28 October 2014, pp. 11-24.
466
AfghAnistAn 2015
red to the 2014 estimates.54 However, the overall macroeconomic situation

has remained stable and there are hopes of a gradual recovery in the next
few years. The GDP growth rate marginally increased from 1.3% in 2014
to 1.5% in 2015. There was a slight growth in services, from 2.2% (2014) to
2.8% (2015), while the industry expansion rate was 1.4% lower than the pre-
vious year’s 2.4%. The data on new firm registrations showed a small rise in
investment activities; however, these remained low in comparison with the
2012 level. The agricultural output was negative at -2.0% in 2015, mainly
due to unfavourable weather conditions.55 The inflation rate decreased to
1.5% from 4.5% in 2014, which may be explained by the fall of private con-
sumption. The exchange rate saw the afghani depreciated by 7% against the
US dollar, due to the decrease in foreign aid and the tendency of Afghan
consumers to save their wealth in foreign currencies because of the political
and military uncertainty.56 The area where the Afghan economy improved
most was in the fiscal sphere. Domestic revenues improved from 8.7% of the
GDP in 2014 to 10.4% in 2015, which was, in part, the result of the Kabul
government’s reforms in tax policy and arrears collection, and, in part, an
effect of cautious expenditure management. Total expenditure slightly in-
creased from 26.2% in 2014 to 27% in 2015.57
The issue of opium poppy cultivation also slightly improved during
2015, with the total area under cultivation estimated to be 19% less than
2014. This was even more significant in the context that this was the first
decrease since 2009. A similar improvement was recorded with regard to the
areas where poppy eradication was carried out, with an increase of 40% from
2014; this was due to enhanced coordination between the government’s
agencies and increased protection on the part of the military. However, the
data for 2015 confirmed the connection between opium production and
insecurity, with 97% of the total production of opium taking place in the
Southern, Eastern and Western provinces, where the political and military
situation is most unstable.58
54. ‘Asian Development Outlook 2016: Asia’s Potential Growth’, Asian Develop-
ment Bank, March 2016, p. 151.
55. ‘Afghanistan Development Update’, The World Bank, April 2016, pp. 1-10.
56. Ibid.
57. Ibid.
58. ‘Afghanistan Opium Survey 2015. Executive Summary’, United Nations Of-
fice on Drugs and Crime, October 2015, pp. 5-9.
467
kYrgYzstan 2015: a countrY adriFt?
Matteo Fumagalli
Central European University

fumagallim@ceu.edu
In August 2015 Kyrgyzstan completed the accession process to the Eurasian Eco-
nomic Union (EEU). Bishkek now firmly gravitates in Russia’s orbit. In October
parliamentary elections returned a six-party national assembly, where the president,
Almazbek Atambayev, could count on a strong pro-presidential power base, consisting
of the «president’s party», the Social-Democratic Party of Kyrgyzstan (SDPK), and the
new «Kyrgyzstan» party. Suggesting that Kyrgyzstan is a country adrift might appear
counter-intuitive. However, the impression resulting by an in-depth analysis is that
the Central Asian country’s political system and society are presently floating, without
trajectory or leadership. In fact, the government has been unable to resolve the never-
ending controversy over the Kumtor gold mine. The authorities are also showing
signs of preoccupation due to the threat posed by the Islamic State (IS). This being the
situation, the chapter reviews two economic issues that largely shaped political and
social developments in 2015: the first is the accession to the Eurasian Union and the
effects that the economic crisis in Russia had on the Kyrgyz economy. The second is
the turbulence surrounding Kumtor. Next, the chapter analyzes the results and effects
of the October parliamentary elections. The remainder of the chapter focuses on some
controversial legislative initiatives and concludes by discussing the threat posed by the
IS to Kyrgyzstan.
1. Introduction
Suggesting that Kyrgyzstan is a country adrift might appear counter-
intuitive. After all, in August 2015 the small Central Asian republic com-
pleted the accession process to the Eurasian Economic Union (EEU).
Consequently, Bishkek now firmly gravitates in Russia’s orbit. In October
parliamentary elections returned a six-party national assembly, where the
president, Almazbek Atambayev, could count on a strong pro-presidential
power base, consisting of the «president’s party», the Social-Democratic Party
of Kyrgyzstan (SDPK), and the new Kyrgyzstan party. Yet, the impression is that
of a political system and society that float, without trajectory or leadership.
The government has been unable to resolve the never-ending controversy
over the Kumtor gold mine. The authorities are also showing signs of pre-
occupation with the threat posed by the Islamic State (IS). Although pre-
cise numbers are hard to come by, a few hundreds Kyrgyzstani citizens are
among the ranks of either the IS or Al Qai‘da’s affiliate Jabhat al-Nusra.
Without a proper attempt at addressing the root causes of discontent or

Matteo FuMagalli
the individual pathways to radicalization and recruitment, the government

is resorting to the strategy it knows best: a crackdown on civil and political
liberties. The chapter begins with reviewing two economic issues that largely
shaped political and social developments in the country in 2015: the first
is the accession to the Eurasian Union and the effects that the economic
crisis in Russia had on the Kyrgyz economy. The second is the turbulence
surrounding Kumtor. Next, the chapter analysis the results and effects of
the October parliamentary elections. The remainder of the chapter focuses
on some controversial legislative initiatives and concludes by discussing the
threat posed by the IS to Kyrgyzstan.
2. International and domestic causes of a critical economic situation
The Kyrgyz economy and, more broadly, society suffer from two main
sources of vulnerability. The first stems from the fact that Kyrgyzstan is a
resource-poor country, whose main strategic asset is the gold mine at Kum-
tor (and other mining sites, which are confronted with similar challenges). A
drop in production (of gold) is bound to cause a decline in export revenues
which constitute the main source of hard currency. This has implications
on GDP growth, tax revenues and social welfare. The second is the growing
dependence on the Russian economy. Over a million Kyrgyzstani citizens
work in Russia and migrants’ remittances constitute an important source of
livelihood for local households. Last but not least, Kyrgyzstan’s membership
in the Eurasian Economic Union (EEU) meant that the country’s position
as main entry in the Central Asian economic space and re-export point for
Chinese goods was lost because of the higher tariffs imposed on non-EEU
imported goods.
In August 2015, after years of delays and wrangling during the acces-
sion negotiations, Kyrgyzstan finally formally joined the EEU, a regional
economic organization which also includes Russia, Belarus, Kazakhstan
and Armenia.1 The strongest argument in favor of Kyrgyzstan’s member-
ship in the EEU has long been the promise of long-term economic sta-
bility and development. EEU membership will bring a welcome easing
of regulations for Kyrgyz labour migrants in member countries, a critical
issue for Kyrgyzstan’s economy and society, as these critically depend on
remittances. Remittances from Kyrgyz migrants are crucial to the local eco-
nomy staying afloat. Official statistics put the number of migrants at some
700,000 (mostly working in Russia and Kazakhstan), whereas international
organizations put the estimate at well over one million, or about 20% of
1. For a discussion of the origins and role of the EEU, see Nicu Popescu, ‘The
Eurasian Union: The real, the imaginary, and the likely’, European Union Institute for
Security Studies, Challiot Paper 132, Paris, September 2014.
470
Kyrgyzstan 2015
the overall Kyrgyzstani population. In recent years the Customs Union

(the EEU’s predecessor) and the Single Economic Space have set in place
a wide range of rules and institutions. This includes two of the agreements
on the legal status of migrant workers and their family members, and the
agreement on cooperation among member states on counteracting illegal
labour migration from third countries. The most important benefit of EEU
accession in this regard stems from the fact that national status is granted
to labour migrants as far as job placement and access to social services are
concerned. This includes the abolishment of licences and permissions to
work; the granting of social and other rights to migrants and their families
(medical care, education); the payment of the income tax in the country
of residence; and recognition of work experience and of pensions rights.
These benefits notwithstanding, some challenges remain. Kyrgyzstan will
have to make arrangements to secure its external borders to restrict the
move of the citizens of third countries and ensure the security of EEU
countries. This will heighten pressure on the Osh and Batken regions in
the south, through which illegal migration via Tajikistan and trade from
China mostly enter the country. What is worse, the Russian financial crisis,
caused by the plummeting of oil prices and Western sanctions because
of Russia’s annexation of Crimea, has had a direct fallout on the Kyrgyz
economy, bringing about a shortfall in migrant remittances, pushing infla-
tion up and foreign investment down, all of which is bound to adversely
impact on the GDP. The most direct fallout of the Russian crisis (recession,
plummeting oil prices, and sanctions) is precisely on the remittances that
Kyrgyz migrants send home: 20% migrants have been forced home becau-
se of shrinking labour market in Russia; as a result, remittances in 2015 are
expected to decrease by some US$425m, or about 23% compared those of
the previous year.2
Apart form the migrants issue, Kyrgyzstan’s economy remains vul-
nerable to external shocks such as the global trend of commodity prices.
Macro-economic data reveal a worrisome picture of the Kyrgyz economy.
GDP growth slowed in 2014 and 2015 (3.5% and 3.2% respectively, compa-
red to 10.5% in 2013)3. During the same period foreign direct investment
declined as well. Russian investment and subsidies were announced in the
closing months of the period under review as a way to promote and speed
up the accession process to the EEU. They included US$600m to upgrade
gas infrastructure, US$300m to enhance border security, and US$1.2bn for
the establishment of a Development Fund aimed at offsetting the costs of
2. ‘Eurasian Union will give few benefits’, Oxford Analytica, 24 March 2015; ‘Re-
mittances to Central Asia fall sharply, as expected’, Eurasianet, 21 April 2015.
3. ‘Ekonomika.kg: Pechalnye itogi, smutnye perspektivy. Chast’ I’ (Economics.
kg: Vague results, sad perspectives, Part I). 24.kg, 24 December 2015. ‘Ekonomika.
kg: Pechalnye itogi, smutnye perspektivy. Chast’ II’ (Economics.kg: Vague results, sad
perspectives). 24.kg, 28 December 2015.
471
Matteo FuMagalli
EEU integration4. Much of this has now been put on hold. In turn, the
uncertainty surrounding the implications of EEU integration has led to a
sharp decline of both Western and Chinese investment.
3. The Kumtor gold mine
The gold mine at Kumtor, located some 350 kilometres south-east

of the capital Bishkek, is the country’s main source of hard currency, a
vital contributor to the country’s GDP, and the single largest private
employer.5 Since 1997, when production started, Kumtor has emerged as
one of the most contentious issues in the small Central Asian republic’s
socio-economic and political life.6 In 2014 the mining sector accounted
for 15% of the budget revenues, 15% of the country’s GDP and over half of
its industrial output and export revenues, constituting Kyrgyzstan’s main
source of wealth.
3.1. The deal that never was

In February 2014, after months of protests, rallies, and violence, the
parliament voted in favour of a new agreement framework, replacing the
one signed in 2009. At the time, the Canadian company Centerra Gold
Inc. was the owner of the mine; Kumtor Gold Company, fully owned by
Centerra, operated the mine. In turn, the Kyrgyzstani government owned
33% of the shares in Centerra (not Kumtor) via the state-owned mining
company Kyrgyzaltyn JSC7. Centerra also owned other mining sites in
Mongolia, Russia, Turkey, and China, and the Kyrgyz government, being
a shareholder in Centerra, received dividends from Centerra’s profits, in-
cluding those accruing from activities outside Kyrgyzstan.8 This being the
situation, a new agreement, whose signature was expected first in late 2014
4. Ibid.
5. For a detailed overview of the stance on Kumtor of each political party in
the country see Dave Gullette & Asel Kalybekova, Agreement under Pressure. Gold
Mining and Protests in the Kyrgyz Republic, Friedrich Erbert Stiftung, 2014, pp. 7-11.
6. Natsional’nyi Institut Strategicheskikh Issledovanyi Kirgizskoi Respubliki
(National Institute for Strategic Studies), Faktory negativnogo otnosheniya mesto-
nogo naselenia k investoram, iskopaemykh, vzaumootnosheniya, hedropol’zovateley
mestnikh soobshchestv (Factors of negative attitudes of the local population to in-
vestors, developers of mineral deposits, the relationship of subsoil users and local
communities), Bishkek, July, 2013.
7. Kumtor’s website details how ownership and control changed hands over the
years (http://www.kumtor.kg/en/about/centerra-gold-inc).
8. For a more detailed discussion see Matteo Fumagalli, ‘The Kumtor Gold
Mine and the Rise of Resource Nationalism in Kyrgyzstan’, George Washington Uni-
versity, Central Asia Program, Economic Papers, 16 August 2015.
472
Kyrgyzstan 2015
and then any time in the first half of 2015, seemed in the offing, bound
to radically revise the contentious 2009 framework agreement. The terms
of the new agreement would have been the following:9 The government
would release its shares in Centerra; in turn Kumtor would be co-owned
as a joint venture (50-50) by Centerra and the Kyrgyzstani government,
via Kyrgyzaltyn. The new agreement would have lead to Bishkek giving
up its share in Centerra’s profit outside Kyrgyzstan, receiving in exchange
greater responsibilities and profits exclusively in Kumtor. This was a deve-
lopment which would have tyed the performance of the Kyrgyzstani eco-
nomy to the volatility of gold prices, making the local economy even more
dependent on a single sector (gold) at the expense of other (non-gold)
sectors. This, in turn, would have raised key questions about the long term
development of the country. However, on 9 April 2015 the national par-
liament adopted a non-binding resolution which called the government’s
handling of the Kumtor negotiations «unsatisfactory».10 On 13 April, then
Prime Minister Otorbayev, in a surprising turn of events, announced that
the government would no longer pursue a new agreement, as this «was
no longer in the interests of the country».11 Ten days later, on 23 April
the prime minister resigned. The new government led by Temir Sariyev
promptly confirmed that neither nationalization nor the renegotiation of
the deal were on the agenda. «Nationalization will only create certain risks
and threats for us. We must seek other ways», Sariyev stated in April.12
Spats between the parties resurfaced in late July when the State
Agency for Geology and Mineral Resources noted that Centerra’s report
detailing data on stocks of gold at Kumtor (including the projected lower
production in 2015) was overdue.13 Calm around the Kumtor issue was, as
predicted,14 merely a lull. A bitter row re-ignited as the new parliament
convened after the elections (see the next section) and the government,
led by Temir Sariyev, was confronted with this seemingly irresolvable que-
9. As detailed below, these proposals were later widrawn.

10. Ibid.
11. Cecilia Jamasmie, ‘Kyrgyzstan aborts plan to grab Centerra’s Kumtor mine,
but wants more say’, Mining.com, 17 April 2015; Cecilia Jamasmie, ‘Kyrgyzstan gv’t
told to ensure ‘smooth sailing’ for Centerra Gold’s Kumtor mine’, Mining.com, 1 July
2015.
12. Cecilia Jamasmie, “Kyrgyzstan names new PM to settle issue with Centerra
over Kumtor mine”, Mining.com, 30 April, 2015.
13. Tatyana Kudryavtseva, « Tsenterra eshche ne predstavila KR otchet s isme-
nennymi dannyimi o zapasakh zolota na Kumtore (Centerra has not yet submitted a
report to the Kyrgyz Republic with the new data of gold reserves at Kumtor) 24.kg, 30
July 2015, available at (http://24.kg/ekonomika/17035_tsenterra_esche_ne_predsta-
vila_kr_otchet_s_izmenennyimi_dannyimi_o_zapasah_zolota_na_kumtore).
14. M. Fumagalli, ‘The Kumtor Gold Mine’.
473
Matteo FuMagalli
stion.15 The most immediate cause of the new development lies in the fai-
lure of the parliament to adopt an amendment of the «Water Code». This
would essentially prevent mining sites from operating at high altitudes,
where their functioning would jeopardise glaciers, already in retreat. Fai-
lure to amend this would lead to making Centerra’s license to operate the
mine inapplicable.16 An even more disconcerting development occurred
right before the closing of the year under review as the government noti-
fied Centerra Gold of its intention of withdrawing from the renegotiations
of the agreement,17 something which the Kyrgyz government itself had
proposed to Centerra. In the words of an official statement, the Kyrgyz go-
vernment «considers that the existing agreement on Kumtor in the current
environment does not meet the interests of the Kyrgyz Republic». This last
«act of brinkmanship»18, which Bishkek blamed on Kumtor’s lower than
expected output in 2015, shows the intention to pursue yet another re-
structuring of the ownership configuration of Kumtor, its governance, and
the distribution of dividends. A new wave of «resource nationalism» has se-
emingly engulfed the country and the international companies operating
there, in what has become a volatile political and business environment.
4. The 2015 parliamentary election in Kyrgyzstan
On 4 October 2015 Kyrgyzstan held its sixth parliamentary elec-

tion since achieving independence form the Soviet Union in 1991.
Of the fourteen parties allowed to register and contest the elections, six
managed to pass the required threshold and gain seats in the Jogorku Kenesh
(National Assembly).
On the eve of the 2015 national elections, The Social-Democratic Par-
ty of Kyrgyzstan (SDPK) was the country’s dominant political party. After
spending two decades at margins of Kyrgyzstan’s political life, the SDPK
had been catapulted to the centre of the political system by the democratic
breakthrough which followed the ouster of former president Bakiyev and
the election of Almazbek Atambayev to the presidency in October 2011.
15. ‘Kyrgyzstan: Key gold mine at risk of stoppage’, Eurasianet, 17 December

2015.
16. ‘Government submits package of documents on Kumtor to parliament’,
24.kg, 21 December 2015. ‘Kyrgyz government intends to initiate new version of
project Kumtor restructuring’, 24.kg, 22 December 2015.
17. ‘Centerra Gold: No assurances that discussions between Kyrgyzstan and
Centerra will result in a mutually acceptable solution regarding Kumtor project’,
24.kg, 23 December 2015; ‘Kyrgyzstan ends talks with Canada’s Centerra over Kum-
tor Mine’, 24.kg, 23 December 2015.
18. ‘Kyrgyzstan: Talks over gold mine again hit rocks’, Eurasianet, 22 December
2015.
474
Kyrgyzstan 2015
Another important political party, established by former Respublika MP

Kanatbek Isaev in 2015, was the Kyrgyzstan party. With an unclear ide-
ological platform but well-endowed financially (backed by the owner of
the largest vodka company in the country), in 2015 the Kyrgyzstan party
staged a lavish electoral campaign. The 7% nation-wide threshold for po-
litical parties made the formation of electoral coalitions compelling. By
2015, however, SDPK’s strong competitors in 2010 had gradually withered
away: nationalist Ata Jurt, with a stronghold in the south had suffered se-
veral defections, as had been the case with Respublika. Even more so, the
Ar-Namys party, led by long-time politician Feliks Kulov, had literally been
deserted by its members. Apart from Respublika and Ata Jurt, the main
challenge to the strong organizational presidential machine was expected
to come from the Butun Kyrgyzstan-Emgek coalition. Butun Kyrgyzstan was
led by Adakhan Madumarov, a nationalist politician based in the south,
whose party narrowly failed to pass the threshold to gain seats in 2010.
Emgek was led by Askar Salimbekov, a wealthy businessman from the nor-
thern regions and owner of the country’s largest market, Dordoi, in the
capital Bishkek.
4.1. Results
Elections returned a six-party parliament (table 1). At 27% SDPK won
comfortably. The opposition split into two competing coalitions (Respublika-
Ata Jurt and Butun Kyrgyzstan-Emgek) and fared poorly, with the former co-
ming second (20% of the popular vote) and the latter failing to secure the
required threshold, receiving just over 6% of the popular vote. The other
parties that managed to pass the threshold were Kyrgyzstan (12.8%), Onuguu-
Progress (9.3%), Bir Bol (8.5%), and Ata-Meken (7.75%).
The SDPK won predictably and comfortably, albeit not by the expec-
ted landslide. The SDPK came first in seven out of nine electoral districts.
Respublika-Ata Jurt won in the other two districts (Talas in the north-west and
Jalalabat in the south), with an especially strong performance in Talas where
it gained 37% of the popular vote. Kyrgyzstan did exceptionally well in the
Chuy district (over 17%), as well as in Osh city and Jalalabat in the south.
Onuguu-Progress gained more than 14% in Jalalabat, with Bir Bol obtaining
its best results in Jalalabat and Batken (around 11%).
A comparison with 2010 highlights interesting trends (table 2). First,
the SDPK significantly increased its presence in the new parliament (38
seats, up from 26 in 2010). Kyrgyzstan, Onuguu-Progress and Bir Bol were
not represented in the fifth legislature, whereas in the sixth the three par-
ties received 18, 13, and 12 seats respectively. Respublika-Ata Jurt incurred
significant losses (28 seats in 2015). In 2010 the two parties, having run
separately, conquered 23 and 28 seats, whereas they only won 28 seats in
2015. Ata Meken also performed poorly, losing 7 seats (11 in 2015, down
from 18 in 2010).
475
Matteo FuMagalli
Table 1. The 2015 Parliamentary Election Results (voters and percenta-

ges)
Votes (overall)
Issyk-kul
Jalalabat
Osh city
Bishkek
Batken
Naryn
(overall)
Chuy
Talas
Osh
%
SDPK 431,771 27.5 30.4 29.1 12.3 25.7 30.4 40.1 35.5 14.4 29.8
Respublika- 316,372 20.2 20.6 19.6 37.3 21.7 12.8 16.9 16.3 22.6 18.4
Ata Jurt
Kyrgyzstan 203,383 13.0 8.6 17.1 13.0 11.3 16.1 14.5 12.4 14.4 7.1
Onuguu- 143,475 9.3 6.5 8.6 9.3 7.7 6.4 7.5 9.5 14.1 7.6
Progress
Bir Bol 133,800 8.5 6.5 7.2 3.8 6.5 2.4 8.1 10.2 11.4 11.9
Ata Meken 122,152 7.0 7.8 6.5 13.8 7.2 10.5 5.9 6.6 8.5 6.8
Butun
Kyrgyzstan- 96,751 6.1 7.9 4.4 2.6 4.9 8.2 2.6 4.4 7.3 12.4
Emgek
Ar-Namys 12,496 0.7 1.1 0.5 1.6 0.3 0.3 0.6 0.3 1.5 0.6
Others 199,256 7.7 10.6 7 6.3 14.7 12.9 3.8 4.8 5.8 5.4
TOTAL 1,659,456 100 100 100 100 100 100 100 100 100 100
Source: Kyrgyz Respublikasynyn Zhogorku Keneshinin Deputattaryn Shayloo - Cen-

tral Election Commission - (http://ess.shailoo.gov.kg/ServiceJSP.do)
Table 2. Jogorku Kenesh seats
2015 2010 Diff.

SDPK 38 26 +12
Respublika-Ata Jurt 28 51* -23
Kyrgyzstan 18 0 n.a.
Onuguu-Progress 13 0 n.a.
Bir Bol 12 0 n.a.
Ata-Meken 11 18 -7
Ar Namys 0 25 -25
TOTAL 120 120
* Respublika and Ata Jurt ran separately in 2010, receiving 23 and 28 seats respectively.
Source: Central Election Commission, Kyrgyz Republic.
Consequently, SDPK’s grip on power has consolidated; the party in-

creased its number of seats by 50%. Together with Kyrgyzstan, pro-presiden-
tial parties enjoy a strong base in the parliament. Similarly to 2010, Butun
476
Kyrgyzstan 2015
Kyrgyzstan again failed to pass the necessary threshold to gain seats in the
parliament. Ar-Namys, one of the country’s oldest parties, was virtually eli-
minated from political life as it received 0.79% of the votes.
4.2. Coalition-building and government formation

In light of the changes introduced by the 2010 Constitution, the results
of the parliamentary election are consequential for government formation
since the cabinet must rely on a parliamentary majority. Although the par-
liament is home to six parties, the assembly is less fragmented than the
previous one and, at least on paper, should be conducive to more stable ma-
jorities. Relatively swift post-election negotiations ended in the formation of
a coalition comprising, as expected, the SDPK and Kyrgyzstan, alongside Ata
Meken and Onuguu-Progress.19 On 5 November the parliament approved the
formation of the new coalition government by Temir Sariyev (who was also
Prime Minister in the previous government), with the support of 80 MPs.
5. Towards institutional isomorphism:

Russia’s influence casts a shadow on Kyrgyzstan’s civil society
It is not only Bishkek’s foreign and domestic policies which orbit

around Russia. Social developments are largely shaped by occurrences and
even legislative initiative that take place in Moscow, such as the curbing of
civil liberties. Kyrgyzstan’s once vibrant civil society has increasingly become
the target of harassment, intimidation, attacks and more recently legislative
activity aimed at curbing its activities and stifling its impact. Such trends
bear strong resemblance to analogous dynamics in Russia. Rising nationa-
list tones, anti-western themes, far-right and homophobic groups already
regularly feature in the republic’s daily life. The first reading of the «foreign
agents» and «gay propaganda» bills in the year under review was a clear
pointer to the tendency to effectively condone such attitudes and expose
already vulnerable groups to increased state and public pressure and inter-
ference. 20
5.1. The «foreign agents» bill

On 4 June the Jogorku Kenesh voted in favor – 83 to 23 – of the «fo-
reign agents» bill. It was the first reading of a bill which had been in the
works since 2013 and which, before being enacted, is to pass two more re-
19. ‘Parliament majority coalition formed’, 24.kg, 2 November 2015 (http://

www.eng.24.kg/parliament/177805-news24.html).
20. ‘Kyrgyzstan: New laws pose a threat to civil society’, Oxford Analytica, 21
July 2015.
477
Matteo FuMagalli
adings and get the president’s signature.21 The bill requires domestic non-
governmental organizations that receive funding from abroad and engage
in vaguely defined «political activities» to register as «foreign agents». In its
current wording, the bill is problematic in a number of respects. First, the
notion of political activities is defined in very broad terms, encompassing
«activities aimed at influencing public opinion and government policies».
Second, as most local NGOs depend on external funding for their work,
the bill would expose a large number of them to the rigours of the law.
Third, the bill expands the scope of action of the authorities, which are
granted increased powers to inspect the activities of NGOs. NGOs falling
in this category would have to register as «foreign agents». Failing to do
so would expose them to the risk of being closed down by the authori-
ties. In its scope and language the bill mirrors Russia’s legislation on the
same subject, with a focus on the origins of funding and that of political
activities. The final approval of controversial legislation was halted after
the first reading of the bill, as the electoral campaign went on the way,
out of concerns that international support (also financial) for the elections
would be curbed. What remains to be seen is whether in 2016 the legislati-
ve process will be carried to its conclusion, with the final enactment of the
controversial bill.
5.2. The «gay propaganda» bill

A second pending piece of legislation was that on ‘non-traditional
sexual relations’, which also passed the first reading, but did not yet
complete the legislastive iter. According to the proposed draft law, pro-
paganda – defined as depicting in positive light or promoting interest
in same-sex relations – is to be prohibited at public assemblies, in the
media, via the internet. Penalties include administrative and criminal
sanctions, such as fines and jail sentences up to one year. If appro-
ved, the law would infringe on the advocacy of groups for rights of the
LGBTI community (lesbian, gay, bisexual, trans, and/or intersex.), and
would also hinder discussion of LGBTI issues, de facto condoning di-
scrimination and intolerance. Again, the law bears close resemblance to
the one adopted in Russia.22
5.3. Harassment of political and civil rights groups

During the year under review, episodes of attacks against political and
civil rights groups were on the rise: on 3 April 2015 Bishkek-based NGO La-
brys, which defends LGBTI rights in the country, came under attack when a
21. ‘Kyrgyz «Foreign Agents» Bill Moves Forward’, The Diplomat, 4 June 2015.
22. ‘Kyrgyz Anti-Gay Propaganda Law Moves Forward’, The Diplomat, 26 June
2015.
478
Kyrgyzstan 2015
small group threw several explosive bottles into the NGO’s office yard. The
attempt to set it on fire ultimately failed, but Labrys’s subsequent attempts
to launch a police investigation were thwarted, a clear indication of the law
enforcement authorities’ stance against the LGBTI groups. On 27 March
the Osh offices of the Bir-Duino-Kyrgyzstan Human Rights Movement and
the homes of its lawyers were searched by officers of the State Committee for
National Security. Various materials, including computers, flash drives and
files, were confiscated. Although the action was sanctioned by a court, the
State Committee’s actions exceeded the scope allowed by the law (which ap-
plies to cases where lawyers are involved in criminal offenses). The lawyers
first won the appeal, only to see the decision annulled by the Osh Regional
Court. Any attempt to initiate a new investigation into the case of Askarov,
an ethnic Uzbek allegedly involved in the 2010 violence in the south of the
country and detained ever since, has also failed. In September 2014 the
Supreme Court confirmed the decision – by another court – to discontinue
such investigation. Requests to reconsider by the European Parliament and
attempts to secure the involvement of the UN Human Rights Committee
have similarly failed.Washington’s decision to bestow the Human Rights
Defender Award to Askarov plunged Kyrgyz-US relations to a new low, with
Bishkek repealing the 1993 bilateral treaty, which ensures tax-free status to
Kyrgyz employees of US government or aid agencies.
6. Radicalization, the rise of the Islamic State and government crackdown
As already noted in the previous Asia Maior volume,23 the major

global issue that found echoes in Kyrgyzstan is the rise of the Islamic
State (IS). The existence of IS looms large over Kyrgyzstan in at least two
respects. The first concerns radicalization and recruitment of foreign
fighters. This trend has constantly been reported by international and
local news agency as well as organizations such as the International Cri-
sis Group,24 although evidence of radical groups actually taking root re-
mains scant. Estimates of Central Asians living in IS-controlled territory
in Syria and Iraq are set at about 3,000 for 2015 (out of about 20,000
foreign fighters), of whom about 200-300 allegedly originate from Kyr-
gyzstan. Once in Syria, fighters are affiliated to one of two groups, «mir-
roring the larger fault lines of the Syrian conflict».25 First the so-called
23. Matteo Fumagalli, ‘Kyrgyzstan 2014: The painful march towards the Eura-
sian Union as the lesser evil?’, Asia Maior 2014, pp. 401-414.
24. International Crisis Group, ‘Syria Calling: Radicalisation in Central Asia’,
Europe and Central Asia Briefing n. 72, Bishkek/Brussels, 20 January 2015; ‘Central
Asians respond to the lure of Islamic State’, BBC News, 2 June 2015.
25. Noah Tucker, Central Asian involvement in the conflict in Syria and Iraq: Drivers
and Responses, USAID: Arlington, VA, 4 May 2015; Noah Tucker, Research note: Uzbek
479
Matteo FuMagalli
«Aleppo Uzbeks», allied with al-Qa‘ida-affiliated Jabhat al-Nusra. The

second and larger group is found on IS-controlled territory, especially
the cities of Raqqa and Mosul, and includes both fighters and those that
have relocated there, to the live under the Islamic State.26 Regardless
of the reliability of the estimates, what is true is the far greater appeal
of the events in Syria compared to the old «theatre» for Central Asian
militants, namely Afghanistan and Pakistan, now seemingly remote and
irrelevant.27 Syria is seen as an issue of global relevance, whereas the
remote valleys of northern Pakistan seem to be caught up in ferocious
but distant, localized and largely irrelevant fight. The second issue per-
tains to the possible returning fighters28 and the measures taken by lo-
cal governments to counter the threat, real or perceived, posed by the
Islamic State to domestic stability. Again, evidence in support of this
claim is elusive,29 and yet fears along these lines are used by the autho-
rities in support of the introduction of legislation which restricts civil
liberties such as the freedom of non-traditional religious practices and
religious organisations not officially sanctioned by the state. Whereas
government rhetoric suggests that the authorities take the threat se-
riously, policies have so far focused on repression (e.g. apprehending
real or imagined radicals allegedly preparing attacks on local territory)
rather than tackling the root causes of those societal grievances which
find expression in the IS popularity.30
Conclusion
On a superficial level, most political developments that have taken pla-
ce in 2015 point to stability, something which the country has been in short
supply of since acquiring independence from the Soviet Union in 1991.
online recruiting to the Syrian conflict, George Washington University, Central Asia Pro-
gram, CERIA Brief n. 3, November 2014.
26. ‘A Kyrgyz family in the Islamic State’, The Diplomat, 21 April 2015; ‘I sup-
port IS and would fight in Syria, says Kyrgyzstan’s coal king’, Radio Free Europe/Radio
Liberty, 25 March 2015.
27. Ibid.
28. Mark Kramer, ‘The return of Islamic State fighters. Impact on the Caucasus
and Central Asia’, PONARS Eurasia Memo, n. 381, August 2015.
29. ‘Russia continues inflating the ISIS threat in Central Asia’, The Diplomat,
24 September 2015; ‘Is Islamic State’s threat to Central Asian countries real?’, TASS-
Russian News Agency, 18 November 2015.
30. ‘Kyrgyzstan: Security agency will struggle with threat’, Oxford Analytica, 1
October 2015; ‘Kyrgyzstan bans Islamic State’, 24.kg, 26 March 2015; ‘The Islamic
State threat in Central Asia: Reality or spin?’, Jamestown Foundation Eurasia Daily Mo-
nitor, 20 March 2015; ‘Kyrgyz security police say they foiled two Islamic State attacks’,
Reuters, 17 July 2015; ‘From Central Asia to Syria: A teenage girl’s jihad’, International
Crisis Group, 31 December 2014; ‘Islamic State not yet seeking Central Asia expan-
sion, report says’, Radio Free Europe/Radio Liberty, 24 June 2015.
480
Kyrgyzstan 2015
However, at a closer look, this veneer of stability masks a situation characte-

rized by the fact that the country is without a steering direction, adrift in the
face of forces that are beyond its control. In a way, Kyrgyzstan is muddling
through amidst multiple challenges and stress points. If this is a lull, how
long will it be before another major crisis occurs?
481
turkMenistan 2015: existing challenges to the perManent neutralitY
and the strategic developMent oF the Multivector energY policY
Fabio Indeo
Hanyang University, Seoul

fabindeus@hotmail.com
As the country with the fourth largest natural gas reserves in the world, Turkmenistan
is aiming to diversify its energy export routes in order to enhance its strategic role as
an energy supplier. In 2015, this central Asian republic paved the way for the imple-
mentation of the eastward and westward export corridors, starting the completion of
the TAPI pipeline and completing the national East-West gas pipeline.
Even while Turkmenistan confirmed its twenty-year adherence to permanent neutra-
lity in its foreign policy, in the year under review President Gurbanguly Berdimuha-
medow faced growing and dangerous threats along the Turkmen-Afghan border, re-
presented by potential incursions of the Afghan Taliban or other armed groups, which
could affect both Turkmenistan’s national stability and its domestic security. In this
situation, and considering that Turkmenistan’s armed forces may not be ready to face
this challenge along the eastern border, President Berdimuhamedow, in the year un-
der review, reiterated Turkmenistan’s refusal to cooperate with Russia in the Collecti-
ve Security Treaty Organization (CSTO) framework. However, unconfirmed reports
have suggested that Uzbek and Russian military units have already been engaged
along the Turkmen-Afghan border, reinforcing Turkmenistan’s border defence capa-
city. Likewise, according to some sources, military cooperation between Turkmenistan
and the US appear to be in the offing.
1. Introduction
During 2015 Turkmenistan has been profoundly worried about the

growing activism of armed militants along its eastern border, which it shares
with Afghanistan. The potential convergence between Central Asian ter-
rorists – mainly the Afghan Taliban and the Islamic Movement of Uzbeki-
stan – and foreign fighters linked to the so-called Islamic State represent a
dangerous threat to national stability and domestic security, not only with
respect to the preservation of the current political leadership but also with
respect to the future implementation of the eastward corridor for energy
exports. As a matter of fact, the completion of the Turkmenistan-Afghani-
stan-Pakistan-India (TAPI) gas pipeline (from Turkmenistan to India and
Pakistan, crossing Afghanistan) has progressively become a strategic goal in
the Turkmen strategy of diversifying energy exports in order to lessen the
dependence on gas exports delivered to China.

Fabio indeo
On 12 December 2015, Turkmenistan celebrated the 20th anniversary

of permanent neutrality, based on a peaceful and non-alignment position
in foreign policy. However, if the Taliban threat along the border becomes
more relevant, Turkmen President Gurbanguly Berdimuhamedow will be
pushed to revise the traditional neutrality concept in foreign policy in order
to receive the military support needed to contain the destabilizing armed
incursions of terrorists.
With respect to the diversification of its energy exports, Turkmenistan
took concrete steps, starting the completion of the TAPI pipeline and main-
ly reaffirming its commitment to supplying the Southern Gas Corridor. As a
matter of fact, in addition to the Ashgabat Declaration signed in May 2015,
Turkmenistan completed the East-West gas pipeline, which is meant to fuel
the future westward export route to the EU markets.
2. The domestic political scenario
Since 2012 Turkmenistan has progressively undertaken a gradual pro-

cess of democratization and reforms, in order to change the national politi-
cal system from a one-party system – based on the presidential Democratic
Party – to a multi-party political system: currently the Party of Industrialists
and Entrepreneurs and the Agrarian Party of Turkmenistan - which were
founded in 2012 and 2014 respectively – are the other official political par-
ties in the country.
Nevertheless, Turkmenistan remains an authoritarian state: President
Berdimuhamedow is also the head of government and the commander in
chief of the armed forces. According to the Turkmen leadership, an im-
mediate adherence to the democratic experiences of other states would be
inappropriate for Turkmenistan, while a gradual approach to the democ-
ratisation could better ensure that political and socio-economic reforms are
consistent with “the centuries-old democratic traditions”.1
The role of the Council of Elders – a consultative assembly of elders
from all provinces of Turkmenistan assisting the president in addressing is-
sues of state importance – and of the Gengesh – the local self-government
bodies – reflect the Turkmen’s willingness to respect the national traditions
and to undertake an endogenous approach towards democracy.
During the last session of the Council of Elders, one of the debated is-
sues was the worsening of the economic outlook, due to falling global energy
prices, which has severely affected the Turkmen economy, which is heavily
reliant on natural gas exports. The Council of Elders proposed abolishing
1. Mariya Y. Omelicheva, ‘Eye on the international image: Turkmenistan’s na-

tion branding’, in Mariya Y. Omelicheva (ed.) Nationalism and identity construction in
Central Asia, Lanham: Lexington Books, 2015, p. 105.
484
TurkmenisTan 2015
the free supply of electricity, cooking gas, and water to the country’s house-
holds, so as to reduce welfare benefits – introduced by the former President
Niyazov in 1993 –, which contribute to ensuring domestic stability.2
Moreover, in January 2015 Turkmenistan devalued its national cur-
rency, the Manat, in order to bolster its effort to diversify its trade’s.3
Following the negative shortcomings in the energy, economic and se-
curity spheres, Turkmenistan’s President made reshuffled his government,
changing the staff in the government’s senior posts.
In August 2015, the Deputy Prime Minister Durdylyyev was dismissed,
as was the Minister of Energy, Geldi Saryev, because of shortcomings in their
work, while Dovranmammed Rejepow was appointed as the new Minister of
Energy.4 As we observe in the next sections, Turkmenistan’s success in the
energy sector arrived only in December 2015, following the completion of
the East-West gas pipeline and the beginning of the realization of the TAPI
gas pipeline (Turkmenistan-Afghanistan-Pakistan-India).
Furthermore, the growing threats to national security, due to Taliban
activities along the Turkmen-Afghan border pushed the Turkmen President
to dismiss Begench Gundogdiyev from the post of Defence minister: Yay-
lim Berdiev – the former minister of national security – became the new
Defence minister, while Guychgeldi Hojaberdiev was appointed Turkmeni-
stan’s minister of national security.5
3. Threats to national security at the eastern border
During 2015, the Turkmen authorities have dealt with a worsening

security outlook along the eastern border, which is shared with Afghanistan,
following the consolidation of tbe Taliban’s position in the Afghan districts
close to the Turkmen border. After the Taliban took control of Khamyab
province in December 2014, they extended their control over Faryab pro-
vince in Afghanistan. Frequent clashes and military incursions have been
reported, even if they diminished compared to 2014.
Considering that, according to two of the main experts on Central
Asian security, the Afghan government does not have the military force to
2. ‘Turkmenistan Set to Scrap Core Welfare Benefits’, Eurasianet, 10 September

2015 (http://www.eurasianet.org/node/75016).
3. Chris Rickleton, ‘Turkmenistan: What’s Behind Sudden Manat Devalua-
tion?’, Eurasianet, 2 January 2015 (http://www.eurasianet.org/node/71506).
4. ‘Turkmen Energy Minister Sacked’, Radio Free Europe/Radio Liberty, 23
August 2015 (http://www.rferl.org/content/turkmenistan-energy-minister-sacked-
president/27203788.html).
5. Aygun Badalova, ‘New ministers appointed in Turkmenistan’, trend news
agency, 6 October 2015 (http://en.trend.az/casia/turkmenistan/2440579.html).
485
Fabio indeo
restore security in its western provinces, the rise of Taliban activism repre-
sents a serious challenge for Ashgabat.6
In terms of trans-border stability, the situation is further complicated
by the presence of an estimated 1.5 million ethnic Turkmens in the nor-
thern Afghan provinces of Faryab and Jowzjan, just beside the border with
Turkmenistan. In these Afghan border provinces, where the Taliban are
firmly entrenched, the local Turkmen community have organized a kind of
popular militia – led by Gurbandurdy and Emir Karyad, two former ethnic
Turkmen warlords – which, in 2014 and 2015, fought against the Taliban to
protect the local Turkmen.7
This being the situation, Turkmen border guards – worried about the
Taliban threat – in order to prevent incursions by the Taliban have closed
the border, installing obstructive barb wire along the border. This move has
adversely affected the ethnic Turkmens on the Afghan side, depriving them
of vital grazing pastures that are located on the Turkmen side of the border
and which Afghan Turkmens traditionally had access to in the past.8
In addition to the Taliban threat, the rising presence of Central Asian
foreign fighters linked to the Islamic State (IS) is another looming challen-
ge facing Turkmenistan. According to the International Crisis Group the
number of Central Asian jihadists – which are active in Iraq and Syria under
the banner of the IS – is between 2,000 and 4,000. However, estimates vary,
mainly because Central Asian governments often overestimate the number
of terrorists for internal political reasons, in order to tighten domestic social
control.9
Russia also appears to overestimate the presence of IS fighters in Cen-
tral Asia, putting the number of IS fighters along the Turkmen-Afghan bor-
der at 2,500, in an ill-disguised attempt to pressure Ashgabat to establish
military cooperation with Russia within the CSTO framework (the Collec-
6. Bruce Pannier, ‘Militant Melting Pot: Extremists Flourish South Of Turk-

menistan’, Radio Free Europe/Radio Liberty, 11 March 2015 (http://www.rferl.org/con-
tent/afghanistan-islamic-extremists-turkmenistan/26893845.html); Jax Jacobsen,
‘Turkmenistan Contends with Taliban Threat’, Silk Road Reporters, 19 March 2015
(http://www.silkroadreporters.com/2015/03/19/turkmenistan-contends-with-taliban-
threat).
7. Zhulduz Baizakova, ‘Afghanistan’s Ethnic Turkmens: Enemies or Allies for
Ashgabat?’, Eurasia Daily Monitor, Volume 12, Issue 67, 10 April 2015 (http://www.
jamestown.org/programs/edm/single/?tx_ttnews%5Btt_news%5D=43779&cHash=e
29bdd2174d8b3c32dc8ec293df81d77#.VneSBvnhDIU).
8. Ibid.
9. International Crisis Group, ‘Syria Calling: Radicalization in Central Asia’,
ICG Europe and Central Asia Briefing, No. 62, 20 January 2015; John Heathershaw &
David W. Montgomery, ‘The Myth of Post-Soviet Muslim Radicalization in the Cen-
tral Asian Republics’, Research Paper, Russia and Eurasia Programme, November 2014
(https://www.chathamhouse.org/sites/files/chathamhouse/field/field_document/20141
111PostSovietRadicalizationHeathershawMontgomery.pdf).
486
TurkmenisTan 2015
tive Security Treaty Organization, the main regional security organization

leaded by Russia, which also includes Kazakhstan, Tajikistan, Kyrgyzstan,
Armenia and Belarus).10
The future possible return to their homelands of the Central Asian
fighters now active in Syria and Iraq represents a big potential challenge
for the Turkmen and other Central Asian authorities. This threat appears
to be a serious one, particularly after the *IS’s announcement that it in-
tended to create a Khorasan vilayat (province) of the Caliphate, including
Turkmenistan, Central Asia and Iran. It is a fact that the number of Tur-
kmen IS fighters seems not to be so high – less than 400, much less than
their Uzbek or Tajik counterparts. However, a potential merger between
the IS and regional Islamic extremist movements is clearly perceived as a
destabilizing and dangerous threat. Indeed, in August 2015 the leader of
the Islamic Movement of Uzbekistan – IMU, which represents the most
powerful and rooted Islamic movement in Central Asia – pledged its alle-
giance to the IS.11
This being the situation, President Berdimuhamedow has discussed
with the President of Uzbekistan, Islam Karimov, in Tashkent, the worse-
ning regional security outlook and how to address the threats coming from
Afghanistan.12
Turkmenistan has always adopted a pragmatic approach toward Af-
ghanistan, offering economic solutions to Afghanistan’s problems and at-
tempting to integrate the country within a regional economy through the
development of trade and energy infrastructures (natural gas and electricity
networks).13
Part of the Ashgabat-sponsored economic solution to the Afghan woes
is the completion of the TAPI gas pipeline (on which, more below). Indeed,
the completion of TAPI will make available to Afghanistan both the supply
of Turkmen natural gas, lucrative transit fees and revenues (estimated at
500.000-$1 billion per year) and, last but not least, the building of infra-
structure and the creation of new jobs.14
10. Joshua Kucera, ‘Kremlin Talks Up ISIS Threat To Central Asia, Russia’,
Eurasianet, 6 January 2015 (http://www.eurasianet.org/node/71531).
11. Fabio Indeo, ‘L’ombra del «Califfato» sull’Asia Centrale’, Limes, No. 5, 2015,
pp. 231-232; Edward Lemon, ‘IMU Pledges Allegiance to Islamic State’, Eurasianet, 1
August 2015 (http://www.eurasianet.org/node/74471).
12. The Government of Turkmennistan, Turkmenistan. The Golden Age,
‘Talks between President Gurbanguly Berdimuhamedov and President Islam Kari-
mov’, 8 October 2015 (http://www.turkmenistan.gov.tm/_eng/?id=5201).
13. Andrew C. Kuchins, Jeffrey Mankoff & Oliver Backes, ‘Central Asia in a re-
connecting Eurasia. Turkmenistan’s evolving foreign economy and security interests’,
CSIS Report, Center for Strategic and International Studies, June 2015, p. 8 (http://csis.
org/files/publication/150513_Kunchins_CentralAsiaTurkmenistan_Web.pdf).
14. ‘Afghanistan, Turkmenistan Ink Gas Deal’, Natural Gas Asia, 13 July 2013
(http://www.naturalgasasia.com/afghanistan-turkmenistan-ink-gas-deal).
487
Fabio indeo
Turkmenistan concretely supports Afghanistan’s development, by sup-

plying electric power and liquefied petroleum gas at preferential prices,
building industrial facilities and sending humanitarian aid. In 2015 the
Turkmen President announced the objective of increasing fivefold the elec-
tricity supply to Afghanistan, following the expected completion of the new
gas turbine power plants in the regions of Lebap and Mary.15
In November 2015, Turkmenistan concluded the national section of
the Turkmenistan-Afghanistan-Tajikistan railway, from Atamyrat to Akina
along the border with Afghanistan. In the future this trans-regional railroad
corridor will play a significant role in integrating Afghanistan in the regio-
nal markets, increasing trade turnover and becoming an important link in
the transport network, integrating the countries of Central Asia and easing
access to the seaports on the coast of the Indian Ocean.16
4. Revising the Turkmen neutrality policy?
Turkmenistan’s ambitious aim is to promote peace and stability in Af-

ghanistan through preventive diplomacy, and the Ashgabat government has
proposed hosting an inter-Afghan peaceful dialogue under UN auspices, as
a new political and diplomatic mechanism for resolving this issue.17 Never-
theless, in security terms, Turkmenistan has boosted its border defences, in
order to monitor and patrol the 257 km largely deserted border with Afgha-
nistan. In October 2015, nearly 70% of Turkmenistan’s land military forces
were deployed in the southern parts of the provinces of Mary and Lebap,
both of which border Afghanistan, which highlights the extent to which the
national government is worried about the security on its eastern border.18
However, Turkmenistan’s armed forces may not be ready to face the
challenge of frequent terrorist incursions from the eastern border, which
could destabilize the country and represents a serious threat to its national
security.
According to the Stockholm International Peace Research Institute (SI-
PRI) Turkmenistan’s armed forces are considered among the weakest in the
15. ‘Turkmenistan increasing electricity exports to Afghanistan’, Chronicles of

Turkmenistan, 9 November 2015 (http://www.chrono-tm.org/en/2015/11/turkmeni-
stan-increasing-electricity-exports-to-afghanistan).
16. ‘Turkmenistan ends construction of its section of TAT Railway’, Chronicles
of Turkmenistan, 19 November 2015 (http://www.chrono-tm.org/en/2015/11/turkmeni-
stan-ends-construction-of-its-section-of-tat-railway).
17. Huseyn Hasanov, ‘Turkmenistan offers to hold inter-Afghan talks under
UN auspices’ trend news agency , 27 May 2015 (http://en.trend.az/business/econo-
my/2399537.html).
18. ‘Turkmenistan Reshuffles Security Chiefs As Afghan Unrest Deepens’, Eur-
asianet, 6 October 2015 (http://www.eurasianet.org/node/75411).
488
TurkmenisTan 2015
region, due to several factors such as the lack of personnel training and as a
result of the neutrality policy. As a matter of fact, the Turkmen army did not
undertake any military operations and were not involved in any multilateral
training exercises as a consequence of Turkmenistan’s refusal to participate
in some regional military-political blocs. Normally, 12,000 border guards
are deployed along the Afghan-Turkmen border but these guards are consi-
dered ineffective due to the lack of qualified personnel.19
During a meeting of the State Security Council, President Berdimuha-
medow – who is also Supreme Commander-in-Chief of the Armed Forces
General of the Army – reaffirmed his engagement in the implementation of
a large-scale military reform, based on upgrading the hardware used by the
armed forces and training qualified personnel.20
If the Taliban threat along the border becomes more urgent, Presi-
dent Berdimuhamedow could be pushed to revise the neutrality concept
in foreign policy in order to receive the military support needed to contain
armed incursions by the Taliban.21
On 12 December 2015 Turkmenistan celebrated the 20th anniversary
of permanent neutrality, which is internationally recognized given the fact
that in 1995 the United Nations General Assembly unanimously adopted
the Resolution on the Permanent Neutrality of Turkmenistan.
During his speech at the International Conference on the Policy of
Neutrality held in Ashgabat, President Berdimuhamedow stressed the stra-
tegic relevance of positive neutrality, as a model based on peacefulness,
non-interference in the affairs of other states, respect for their sovereignty
and territorial integrity, and non-participation in international military or-
ganisations and treaties.22
Moreover, considering that Berdimuhamedow stated that «this status
is a pillar to peace, security and development», and that «the promotion of
fraternal and friendly relations with our neighbours will remain a crucial
aspect of the foreign policy of neutral Turkmenistan», Turkmenistan appe-
ars officially determined to preserve its neutrality policy.23
19. Dmitry Gorenburg, ‘External Support for Central Asian Military and Se-
curity Forces’, SIPRI Working Paper, January 2014, pp. 12-15 (http://www.sipri.org/re-
search/security/afghanistan/central-asia-security/publications/SIPRI-OSFno1WP.pdf).
20. The Government of Turkmenistan, Turkmenistan. The Golden Age, ‘Presi-
dent of Turkmenistan conducts a meeting of the State Security Council’, 4 November
2015 (http://www.turkmenistan.gov.tm/_eng/?id=5277).
21. John C. K. Daly, ‘Amid Rising Regional Tensions, Turkmenistan Reevalu-
ates Neutrality Policy’, Eurasia Daily Monitor, Volume 12, Issue 47, 13 March 2015.
22. The Government of Turkmenistan, Turkmenistan. The Golden Age, ‘Presi-
dent Gurbanguly Berdimuhamedov: neutrality of Turkmenistan has a strong moral
framework of the internal state structure’, Turkmenistan. The Golden Age, 12 December
2015 (http://turkmenistan.gov.tm/_eng/?id=5398).
23. Ibid.
489
Fabio indeo
As a matter of fact, in spite of several talks between Turkmenistan’s and

Russia’s presidents about the security concerns and the threats coming from
Afghanistan, Turkmenistan has to this day refused to cooperate with Russia
in the CSTO framework, disappointing CSTO Secretary General Nikolay
Bordyuzha.24
Nevertheless, unconfirmed reports have suggested that Uzbek and Rus-
sian military units are already engaged along the Turkmen-Afghan border in
order to reinforce the border defence capacity of Turkmenistan. Likewise, ac-
cording to some sources, potential future cooperation between Ashgabat and
Washington to achieve the same security aim seems to be in the offing, even if
the Turkmen government has not officially confirmed this.25
5. The strategic energy partnership with China and the diversification

of export routes
Turkmenistan ranks fourth in the world in terms of the volume of its

natural gas reserves, after Iran, Russia and Qatar. According to the BP Sta-
tistical Review 2015, Turkmenistan holds 17.2 trillion cubic meters (tcm) of
natural gas reserves, even if the estimates of the Turkmen authorities are
higher.26 As a matter of fact, according to an independent audit, the reser-
ves of the Galkynysh field – the world’s second largest in terms of reserves –
together with the Yashlar deposits, are estimated at 26.2 tcm. In November
2015, during the international exhibition and conference «Oil and Gas of
Turkmenistan», the country’s minister for oil and mineral resources, Muha-
metnur Halylov, stated that the reserves of this giant gas deposit will rise to
27.4 tcm when we add the reserves of the newly discovered Garakel field,
which is included in the Galkynysh area.27
The national production of natural gas increased by 11% in 2014 (from
62.3 bcm28 to 69.3 bcm); Turkmenistan exported 41.6 bcm of gas to the
24. ‘CSTO Chief: Uzbekistan, Turkmenistan refuse jointly combatting ter-

rorists’, Ferghana.News, 20 March 2015 (http://enews.fergananews.com/news.
php?id=2947).
25. Paul Goble, ‘Russian and Uzbek Soldiers Reportedly Now in Turkmenistan
to Counter Afghan Threat’, Eurasia Daily Monitor, Volume 12, Issue: 59, 31 March
2015; John C. K. Daly, ‘Neutral No More? Turkmenistan Seeks U.S. Arms’, Silk Road
Reporters, 17 April 2015 (http://www.silkroadreporters.com/2015/04/17/neutral-no-
more-turkmenistan-seeks-u-s-arms).
26. British Petroleum, ‘BP Statistical Review of World Energy 2015’, BP, p. 20
(https://www.bp.com/content/dam/bp/pdf/energy-economics/statistical-review-2015/
bp-statistical-review-of-world-energy-2015-full-report.pdf).
27. ‘Turkmenistan Heading Towards World Gas Markets’, Oil & Gas Eurasia, 19
November 2015 (https://www.oilandgaseurasia.com/en/news/turkmenistan-heading-
towards-world-gas-markets).
28. «bcm» stands for Billion Cubic Metres.
490
TurkmenisTan 2015
countries of China (25.5 bcm), Iran (6.5 bcm) and Russia (9 bcm).29 Under
the program for the development of the country’s oil and gas industry, the
plan is to increase the gas production volume to 230 bcm by 2030.
In spite of these positive prospects in the gas sector, the need to diver-
sify the export energy routes has suddenly become urgent, and not only to
balance the rising Chinese influence in the national energy sector. As a mat-
ter of fact, in 2015, the Turkmen authorities clearly realized that Russia can-
not be considered a reliable energy partner. In February 2015, Alexander
Medvedev – the Gazprom Vice Chairman – revealed that Gazprom would
be cutting more than 50% of its natural gas imports from Turkmenistan,
from 10 bcm (2014) to 4 bcm in 2015.30 This planned reduction of exports
to Russia will affect the national energy budget. This is despite the fact that
Russia signed an agreement with respect to gas supplies with Turkmenistan
for 25 years in 2003 and that in 2008 Russia purchased 42 bcm of Turkmen
gas. Moreover, the Turkmen authorities claim that Gazprom has not yet
paid gas volumes bought in 2015.
At present Ashgabat has lost an energy partner that should be promptly
replaced in order to implement the strategy of diversifying the export rou-
tes as well as selling the increased production that is expected over the next
few years.
When the Turkmen government launched its strategy of export diver-
sification, the main aim was to lessen the dependence on exports to Russia,
finding new partners and opening new export routes: now Turkmenistan is
in a similar situation with China, which has taken over Russia’s role.
China currently is the main energy partner for Turkmenistan in terms
of exports (25.5 bcm in 2014, 60% of total gas exports) and the main investor
in the development of the Turkmenistan gas fields. In addition to the deve-
lopment of the first and second phases of the giant Galkynish gas field, China
National Petroleum Corporation (CNPC) is also developing Turkmenistan’s
Bagtyyarlyk gas field on the bank of the Amu Darya, and investing billions of
dollars in the Turkmen energy sector. After the completion of Line C at the
end of 2015, the China-Central Asia Gas Pipeline will have a capacity of 55
bcm, while the construction of a new gas pipeline from Turkmenistan to Chi-
na (Line D) with the capacity to carry 30 bcm/a of gas will start in 2016. Under
the agreement signed between the CNPC and Turkmengaz, Turkmenistan
will supply China annually with 65 bcm of gas by 2020-2021.31
In the next decade this unbalanced dependence on Chinese markets
could severely affect Turkmenistan’s energy security. As a matter of fact, fol-
29. British Petroleum, ‘BP Statistical Review of World Energy 2015’, pp. 22.
30. Chris Rickleton, ‘Gazprom Clarifies Drawdown in Turkmenistan, Uzbeki-
stan’, Eurasianet, 3 February 2015 (http://www.eurasianet.org/node/71891).
31. ‘Turkmenistan supplied 125 bcm of gas to China’, Natural Gas Europe, 28
September 2015 (http://www.naturalgaseurope.com/turkmenistan-supplied-125-bcm-
gas-to-china-25610).
491
Fabio indeo
lowing the implementation of the Sino-Russian energy deal – based on the

completion of the Power of Siberia gas pipeline (and potentially Altai gas
pipeline) – China could decide to buy more Russian gas, reducing Turkme-
nistan’s gas supply and consequently exposing the Central Asian country to
a condition of vulnerability, even if at present China buys Turkmen gas at a
lower price than Russian gas.
This scenario is pushing President Berdimuhamedow to immediately
find new and alternative energy partners, accelerating the implementation
of the western and eastern vectors of export.32
5.1. Turkmenistan and the Trans Caspian Pipeline: a concrete engagement
In 2015, Ashgabat took significant steps towards the completion of the

Trans Caspian Pipeline (TCP), the energy corridor along the Caspian Sea
between Turkmenistan and Azerbaijan, with the concrete involvement of
Turkmenistan as gas the supplier, in order to enhance the capacity of this
energy route.
Trilateral negotiations among the EU, Turkmenistan and Azerbaijan
have paved the way for improved reciprocal relations, which have tried to
address unsolved issues between Baku and Ashgabat (i.e. the ownership
of disputed offshore oil and gas fields in the Caspian basin), and the re-
cent trilateral dialogue involving Turkmenistan and Azerbaijan and Turkey
have revitalized the Trans Caspian project, producing interesting results.
As a matter of fact, in November 2014 Turkmenistan signed a framework
agreement with Turkey to supply the Trans Anatolian Natural Gas Pipeline
project (TANAP), a section of the Southern Gas Corridor (SGC) project,
which aims to deliver 16 bcm of gas a year from Azerbaijan’s Shah Deniz II
field in the Caspian Sea to Europe via Turkey.33
In January 2015, during a trilateral meeting held in Ashgabat these
three countries decided to further enhance their energy cooperation and
the ministers of Turkey and Azerbaijan invited Turkmenistan to join the
TANAP project.34 Turkmenistan’s participation will enhance the capacity
of this energy route – which is expected to reach 31 bcm in 2026 and 60
32. Micha’el Tanchum, ‘Turkmenistan Poised for TAPI Breakthrough’, Central

Asia-Caucaus Analyst Institute, 18 March, 2015 (http://www.cacianalyst.org/publications/
analytical-articles/item/13165-turkmenistan-poised-for-tapi-breakthrough.html).
33. ‘Presidents of Turkmenistan and Turkey Hold Talks in Ashgabat’, Turkmeni-
stan.ru, 8 November 2014 (http://www.turkmenistan.ru/en/articles/17807.html).
34. Tavus Rejepova, ‘Foreign Ministers of Turkey, Azerbaijan and Turkmeni-
stan Discuss Energy and Transportation in Ashgabat’, Central Asia and Caucasus An-
alyst Institute, 4 March 2015 (http://www.cacianalyst.org/publications/field-reports/
item/13147-foreign-ministers-of-turkey-azerbaijan-and-turkmenistan-discuss-ener-
gy-and-transportation-in-ashgabat.html).
492
TurkmenisTan 2015
bcm in 2030 – allowing Turkmenistan to successfully exploit an alternative

energy corridor with a large capacity, bound to conspicuously enhance the
growth of Turkmenistan gas production and exports.35 On 4 March 2015,
the Turkmen Presidents visited Ankara, where Turkish President Erdogan
announced the project to develop a trilateral mechanism on energy issues
involving the two Caspian countries and Turkey.36
Furthermore, the trilateral meeting involving Turkmenistan and the
EU and Azerbaijan (the so-called Troika) has produced a relevant agree-
ment in the energy issues, in light of the shared convergence of strategic
interests and concerns of the actors involved.
For the European Union, the worsening relations with Russia have fur-
ther highlighted the vulnerability of its energy security and the need to
coherently undertake a diversification strategy with respect to import rou-
tes, aiming to lessen the «unbalanced» reliance on Russian gas imports cros-
sing Ukraine. For Azerbaijan, the Turkish Stream pipeline project – a new
gas pipeline backed by Moscow crossing Turkey and carrying Russian gas
– could undermine Baku’s exclusive role as EU’s alternative supplier along
a southern route bypassing Ukraine.37 Furthermore, the SGC expected ca-
pacity will reach approximately 30 bcm of gas per year – without the contri-
bution of Turkmen gas – representing less than half of the Turkish Stream’s
potential capacity (63 bcm per year). Consequently, Azerbaijan could strate-
gically support Turkmenistan’s participation in the SGC. For Turkmenistan,
a western corridor of gas exports would allow Turkmenistan to diversify
its energy routes, lessening the strong dependence on a single customer –
China, which currently purchases over 60% of Turkmen gas exports – and
offsetting the Russian decision to cut its gas imports from Turkmenistan by
nearly two-thirds.
The EU’s diplomatic engagement has produced significant concrete
steps. In February 2015, Maros Sefcovic, the European Commission’s Vice
President in charge of Energy Union, declared that the EU intends to find a
technical and legal basis for the Turkmen gas supply via Azerbaijan, mainly
because the EU Commission considers the TCP as a project of common
interest.38
On 1th May, during a meeting of the energy ministers of Azerbaijan,
Turkey, Turkmenistan, and EU representatives in Ashgabat, the parties si-
35. Trans Anatolian Natural Gas Pipeline project (www.tanap.com).

36. Zaur Shiriyev, ‘Turkmenistan, Turkey and Azerbaijan: A Trilateral Energy
Strategy?’, Eurasia Daily Monitor, Volume 12, Issue 45, 11 March 2015.
37. Fabio Indeo, ‘Azerbaijan’s role in the Euroasiatic energy chessboard: geopo-
litical and strategic perspective’, in Ghia Nodia & Christoph H. Stefes (eds.), Security,
Democracy and Development in the Southern Caucasus and the Black Sea Region, Bern:
Peter Lang Editions, 2015, pp. 274, 276-279.
38. ‘EU prepares gas agreements with Azerbaijan and Turkmenistan’, trend
news agency, 25 February 2015 (http://en.trend.az/business/energy/2367933.html).
493
Fabio indeo
gned the «Ashgabat Declaration», focused on the development of coope-

ration in the energy field.39 The document said that the sides support the
creation of the favourable conditions necessary for ensuring reliable, stable
and long-term international energy cooperation, taking into account the
interests of producers, transit countries, and consumers of energy resources.
The sides also recognized the importance of equal and mutually beneficial
cooperation in ensuring the supply of natural gas from Turkmenistan to
Europe.40
In July, the first high level meeting of the Working Group on the TCP
project was held in Brussels, involving the deputy ministers in charge of the
energy section in the four countries involved in order to consider all aspects
(organizational, legal, commercial, technical) related to implementing a na-
tural gas corridor from Turkmenistan to Europe.41
Furthermore, in December 2015 Turkmenistan concluded the East-
West pipeline, a 773-kilometer gas pipeline with a capacity of 30 bcm of
natural gas per year that connects Galkynysh’s largest gas field with the
Shatlyk gas compressor station in the province of Mary and the Belek gas
compressor station in the Balkan province. In order to enhance its capacity
to 40 bcm the Turkmen authorities plan to add 10 bcm provided by Malay-
sian Petronas, operating at Turkmenistan’s offshore block. The fact that the
whole pipeline has been built by national energy companies – Turkmengaz
and Turkmennebitgazgurlushyk – and that the $2 billion estimated cost has
been covered by the Turkmen governments shows the strategic relevance
of this corridor to the national strategy of energy export diversification.42
5.2. Geopolitical hindrances and alternative projects
Turkmenistan has clearly reaffirmed its commitment to developing the

SGC, concretely opening a new and alternative westward route of energy
export and potentially playing the role of a gas supplier to the EU. Howe-
39. European Commission, «Ashgabat Declaration», 1 May 2015 (https://ec.europa.

eu/commission/2014-2019/sefcovic/announcements/ashgabat-declaration_en).
40. Ibid.
41. Joe Peerson, ‘European Union putting big hopes on Trans Caspian pipe-
line’, Silk Road Reporters, 17 July 2015 (http://www.silkroadreporters.com/2015/07/17/
european-union-putting-big-hopes-on-trans-caspian-pipeline); Aygun Badalova, ‘An-
other step towards Trans-Caspian Pipeline project implementation’, trend news agency,
15 July 2015 (http://en.trend.az/business/energy/2417215.html).
42. ‘Breaking: Turkmenistan completes strategic cross-country pipeline’, Natu-
ral Gas Europe, 23 December 2015 (http://www.naturalgaseurope.com/turkmenistan-
inaugurates-strategic-cross-country-pipeline); Huseyn Hasanov, ‘Turkmenistan com-
pleting ‘East-West’ gas pipeline’s construction’, trend news agency, 11 December 2015
(http://en.trend.az/business/energy/2468538.html).
494
TurkmenisTan 2015
ver, this ambition could be hampered by some domestic and international

hindrances, such as the dilemma concerning the Iranian corridor and the
persistent Russian opposition to the realization of TCP.
According to Sefcovic there are two potential routes for exporting
Turkmen gas to the EU market: transiting through Iran, and building an
underwater Trans Caspian pipeline.43 Following the improvement of EU-
Iranian relations, the possibility of an an overland pipeline delivering Tur-
kmen gas through Iranian territory to Turkey could be an interesting alter-
native option to pursue, in order to reach the EU market.
However, it will be necessary to build infrastructure in order to realize
this Turkmen-Iranian energy corridor: the current capacity of the Turkmen-
Iranian gas pipeline is 18 bcm, so it would need to be expanded to carry
additional volumes of Turkmen gas to boost TANAP’s capacity. Moreover,
Iran should improve its domestic energy infrastructure in order to connect
it to the Turkish border.44
Russian opposition to the realization of a Trans-Caspian pipeline is of-
ficially motivated by ecological and environmental issues, even if we can also
observe geopolitical reasons in Moscow’s approach, aimed at preventing the
implementation of an alternative export energy route to the EU markets,
which could lessen the EU’s dependence on Russian gas imports. Moreover,
the unsolved legal status of the Caspian Sea contributes to delay a potential
solution with respect to the TCP.
The official position of Ashgabat regarding the project is that the con-
sent of the countries whose territories are involved in the project is enough
to build a pipeline. In spite of the recent enhanced rapprochement with
Azerbaijan on energy issues – which also shared with Turkmenistan the
same approach about the TCP – the next Caspian summit scheduled in
2016 could be decisive in reaching a definition of the Caspian sea’s legal
status and both countries will postpone any decision concerning the Russian
position during the summit.
At the same time, the agreement between Turkmenistan and Ka-
zakhstan for the delimitation of the shared Caspian Sea bed signed in 2015
showed Ashgabat’s willingness to develop a cooperative approach with re-
spect to regional energy issues, enhancing bilateral relations with post soviet
energy producers with the aim of improving the legal framework before the
Caspian summit.45
43. ‘Turkmenistan: Natural Gas Could Reach Europe Through Iran’, Stratfor, 1
May 2015 (https://www.stratfor.com/situation-report/turkmenistan-natural-gas-could-
reach-europe-through-iran).
44. Dalga Khatinoglu, ‘Potential routes for delivering Turkmen gas to EU’,
Natural Gas Europe, 4 May 2015 (http://www.naturalgaseurope.com/potential-routs-
for-delivering-turkmen-gas-to-eu-23508).
45. ‘Kazakhstan ratifies agreement with Turkmenistan on delimitation of Cas-
pian Sea seabed’, AKIpress, 21 July 2015 (http://www.akipress.com/news:562247).
495
Fabio indeo
Considering that the bulk of national reserves are located onshore in

the eastern region, Turkmenistan needs to exploit the potential Caspian
reserves – which are largely unexplored – in order to enhance the western
vector of its energy exports. Ashgabat invited foreign companies to sign
production sharing agreements (PSA) to develop hydrocarbon resources in
the Turkmen part of the Caspian Sea, which are estimated at 12 billion me-
tric tons of oil and 6.5 trillion cubic meters of gas. Currently several foreign
companies – such as Malaysia’s Petronas, Dragon Oil, Italy’s Eni, Russia’s
Itera and Zarubezhneft Cyprus-based Buried Hill – are seeking to develop
the Turkmen offshore energy potential.46
In spite of positive diplomatic steps, given the current outlook, Sefco-
vic’s statement that Turkmen natural gas could start being exported to Eu-
rope through a pipeline under the Caspian Sea by 2019 appears optimistic.
In spite of several hindrances, which have been delaying the TCP’s rea-
lization, the potential participation of Turkmenistan in the AGRI project
could allow the implementation of the Southern Gas Corridor – as well as
of a westward export route – without building an underwater pipeline, also
overcoming Russian claims.
AGRI will be designed to transport Azerbaijani gas by pipeline – with
a planned capacity of 7 bcm that should thereafter be upgraded to 20 bcm
– to a Black Sea port in Georgia for liquefaction and then this LNG will be
delivered via tanker to the Romanian Black Sea port of Constanta before
reaching Eastern European markets.47
If the AGRI system’s capacity is increased, it could potentially accom-
modate LNG exports from Turkmenistan, through the ad hoc facilities in
Turkmenbashi International Seaport. The AGRI project clearly represents
an interesting diversification option for Ashgabat, even if the fate of this
interconnector is strictly interlinked to several economic and geopolitical
hindrances which could delay its completion.48
Turkmenistan’s contribution to the development of an East-West cor-
ridor is growingly significantly with respect to the oil sector, considering
that Turkmen oil transportation through the Baku-Tbilisi-Ceyhan pipeline
increased by nearly 40% in 2015. The BTC pipeline mainly delivers Azer-
baijani oil to the Western markets but also Kazakhstan and Turkmenistan oil
exports by tankers to the Baku port. In 2014, BTC transported 5.6 million
46. The Ministry of Foreign Affairs of Turkmenistan, ‘A Forum «Oil and Gas
of Turkmenistan - investment opportunities» was held in London’, 2 October 2015
(http://www.mfa.gov.tm/en/news-en/3574-a-forum-oil-and-gas-of-turkmenistan-in-
vestment-opportunities-was-held-in-london); ‘Foreign companies show interest in
development of Caspian Sea’s Turkmen shelf ’, Kazinform, 12 October 2015 (http://
www.inform.kz/eng/article/2827385).
47. Agri. The First Lng Project To Be Developed In The Black Sea (http://www.
agrilng.com).
48. Fabio Indeo, ‘AGRI project: opening a westward energy route to EU mar-
kets’, EGS Global Energy Monitor, Vol. 1, No.10, 2013 (www.egskorea.org).
496
TurkmenisTan 2015
metric tons of Turkmen oil, compared to 3.3 million metric tons in 2013.49
At present, the country produces around 10 million metric tons of oil per
year, but in 2015 Turkmenistan increased oil production (+6.5%) partly
thanks to the activities of foreign energy companies – mainly Dragon oil and
Malaysian Petronas – involved in the development of the Turkmen sector of
the Caspian Sea under the production sharing agreements.50
5.3. The launch of the Turkmenistan-Afghanistan-Pakistan-India pipeline
Concerning the eastern energy export corridor, in 2015 Turkmenistan

started to build the TAPI natural gas pipeline, overcoming the traditional
hindrances. On 7 November 2015, Turkmenistan’s President signed a de-
cree ordering the state companies Turkmengaz and Turkmengazneftstroi to
design and to construct the national segment of the TAPI, to be completed
in two years.51
On 13 December 2015, the President of Turkmenistan Gurbanguly
Berdimuhamedow, the President of the Islamic Republic of Afghanistan
Mohammad Ashraf Ghani, the Prime Minister of the Islamic Republic of
Pakistan Muhammad Nawaz Sharif, and the Vice President of India Mo-
hammad Hamid Ansari gathered in the city of Mary to attend the ground-
breaking ceremony of the TAPI gas pipeline.52
Through TAPI, Ashgabat will be able to sell 33 bcm of natural gas per
year, through a pipeline with a length of 1,800 kilometres, which will coss
Afghanistan and Pakistan before reaching India, with an expected cost of
$10 billion.
This relevant success has been made possible by the previous realiza-
tion of some necessary preconditions. Firstly, the TAPI Ltd. International
consortium – established in November 2014 and composed pf Turkmengaz
State Concern, Afghan Gas Corporation, Pakistan’s «Inter State Gas Systems
(Private) Limited» and Indian «GAIL (India)» – selected the Turkmen natio-
nal energy company Turkmengaz as the leader of this consortium and also
49. Maksim Tsurkov, ‘Turkmen oil transportation via BTC increases’, trend news
agency, 18 August 2015 (http://en.trend.az/azerbaijan/business/2424933.html); Fabio
Indeo, ‘Azerbaijan’s role in the Euroasiatic energy chessboard: geopolitical and stra-
tegic perspective’, p. 273.
50. ‘Turkmenistan increases oil production’, Cihan, 14 October 2015 (http://
en.cihan.com.tr/en/turkmenistan-increases-oil-production-1906788.htm).
51. ‘Turkmenistan To Begin Construction Of $10 Billion Gas Pipeline’, Radio
Free Europe/Radio Liberty, 7 November 2015 (http://www.rferl.org/content/turkmeni-
stan-tapi-pipeline-construction/27351009.html).
52. The Ministry of Foreign Affairs of Turkmenistan, ‘Construction work on
TAPI gas pipeline and the third development stage on the Galkynysh field start’, 13
December 2015 (http://www.mfa.gov.tm/en/news-en/3875-construction-work-on-tapi-
gas-pipeline-and-the-third-development-stage-on-the-galkynysh-field-start).
497
Fabio indeo
the main investor. As a leader, the Turkmengaz State Concern will supervise
the interaction concerning the construction, financing, ownership and ope-
ration of the pipeline.53
Secondly, in September 2015, the feasibility study for a project to con-
struct the TAPI gas pipeline was completed. The British company Penspen
was involved in the feasibility study for the TAPI. According to the Asian De-
velopment Bank (ADB), which is a transaction advisor on the TAPI project,
this pipeline will be realized by 2018. Moreover ADB is one of the main
investors and it will try to attract other international actors interested inve-
sting and financing the project.54
Thirdly, Turkmenistan has signed a framework agreement with a con-
sortium of several Japanese companies for the development of the third
phase of the Galkynysh gas field, which will be the main source fueling the
TAPI project.55
So Japan has entered the geopolitical energy game in Central Asia, be-
cause the agreement on Galkynish is a real challenge to the current position
of China, which holds contracts to develop the first and the second phase
of the project. Japanese Prime Minister Shinzo Abe visited Turkmenistan in
October 2015, where he concluded bilateral agreements on the construction
of a gas and chemical plant, power plant and other projects for worth a total
of $18 billion.56 Tokyo’s government has offered investments to construct
industrial plants based on advanced technologies for gas processing meant
for the production of gasoline, polypropylene, polyethylene, caustic soda
and other gas-chemical products. Construction also continues to progress
on a gas chemical complex in Turkmenbashi that will to produce ethylene,
high-density polyethylene, and polypropylene.57
In spite of Turkmen claims that it will complete the infrastructure by
December 2018, the rising threats to regional security and stability appear
likely to delay the implementation of this export corridor which is currently
vital for the national strategy of diversification. Firstly, the TAPI route will
cross areas affected by a great instability such as South-Western Afghani-
stan (Herat, Helmand, Kandahar) and Pakistani Baluchistan. Secondly, the
53. ‘Consortium Leader Picked for Trans-Afghan Pipeline’, Eurasianet, 6 August

2015 (http://www.eurasianet.org/node/74556).
54. Elena Kosolapova, ‘TAPI feasibility study completed (exclusive)’, trend news
agency, 18 September 2015 (http://en.trend.az/business/energy/2433130.html).
55. ‘Turkmenistan to Work With Japan to Further Develop Galkynysh’, Natu-
ral Gas Asia, 18 October 2015 (http://www.naturalgasasia.com/turkmenistan-to-work-
with-japan-to-further-develop-galkynysh-16787).
56. The Ministry of Foreign Affairs of Turkmenistan, ‘The official visit of the
Prime Minister of Japan to Turkmenistan’ (http://www.mfa.gov.tm/en/news-en/3657-
the-official-visit-of-the-prime-minister-of-japan-to-turkmenistan).
57. Robert Brelsford, ‘Turkmenistan to expand gas processing, petchem pro-
duction’, Oil & Gas Journal, 22 September 2015 (http://www.ogj.com/articles/2015/09/
turkmenistan-to-expand-gas-processing-petchem-production.html).
498
TurkmenisTan 2015
growing confrontation along the Turkmen-Afghan border between Islamic

extremists (Taliban, foreign fighters linked to the IS or IMU) and Turkmen
border guards could contribute spreading instability (even if this area is
currently a long way from the northern areas involved in the unrest), repre-
senting a threat to regularly supply energy delivered through TAPI.58
In addition to increasing exports of oil and gas, Turkmenistan also
aims to diversify its national energy strategy and exports, developing
projects to expand natural gas processing and petrochemical production.
Turkmenistan plans to complete a plant for polyethylene and polypropyle-
ne production in Balkan province, as well as a plant for producing synthetic
gasoline from natural gas in Ahal province in the next few years.
The recent energy cooperation with Japan could help Turkmenistan
to develop its national industrial sector. Another interesting opportunity
to diversify the national energy strategy is based on the industrial deve-
lopment and commercial exploitation of more than 200 deposits of various
solid minerals and hydro-mineral raw materials. According to the Turkmen
government, recent geological explorations have showed the presence in
the national subsoil of relevant reserves of various mineral salts – such as so-
dium, potassium, sulfate and magnesium salts – as well as potential reserves
of metals59 such as manganese, copper, iron, lead, zinc, gold.60
58. Fabio Indeo, ‘Turkmenistan 2014: Security Concerns And Unfulfilled Di-
versification Of Export Energy Routes’, Asia Maior 2014, pp. 456-457.
59. For instance, Garabogazkol is one of the four sodium sulfate fields known in
the world, and two of the seven potash deposits of CIS countries are in Turkmenistan.
60. Huseyn Hasanov, ‘Over 200 fields to be developed in Turkmenistan’, trend
news agency, 5 August 2015 (http://en.trend.az/business/economy/2421694.html); Kar-
ine M. Renaud, ‘The mineral industry of Turkmenistan, (advance release)’, USGS
2013 Mineral Yearbook, May 2015 (http://minerals.usgs.gov/minerals/pubs/coun-
try/2013/myb3-2013-tx.pdf).
499
iran 2013-2015: in the Midst oF change
Aniseh Bassiri Tabrizi and Claudia Castiglioni
Royal United Services Institute University of Florence

anisehbt@rusi.org claudia.castiglioni@unifi.it
Iran has gone through great changes in the past two and a half years. After Has-
san Rouhani’s election in June 2013, the country has reached a deal with the P5+1
(the permanent five members of the United Nations Security Council plus Germany)
that promises to bring an end to the twelve-year old dispute over its nuclear program.
Consequently, Iran has managed to improve its international ties, engaging in direct
talks with the United States, resuming diplomatic relations with the United Kingdom,
and attracting an increasing number of political and trade delegations to Tehran from
all over the world. In the aftermath of the nuclear agreement, Iran has then focused
on regional issues and, by securing a seat at the Syria peace talks in Vienna, has
been recognised as «part of the solution» to solving current crises in the Middle East.
This successful record on foreign policy issues, however, has not been matched by deve-
lopments on the domestic front. Despite rising expectations by the Iranian populations
after Rouhani’s advent to power, particularly with regard to political and social freedom
and to the improvement of the economic situation of the country, the current government
has not managed to achieve its stated goals. Starting from these premises, the present
chapter explores the major changes introduced by Rouhani and his Cabinet in the past
two years in the social, economic, political, and diplomatic sphere. In so doing it ad-
dresses the complexities of Iran’s political system and power hierarchy, most notably the
relation between President Rouhani and the Supreme Leader Khamenei, the impact of
the nuclear deal on the domestic front, the frustrations voiced by the reformists, and the
recent hardliners’ attempted comeback to the Iranian political scene.1
1. Introduction
Iran has gone through great changes in the past two and a half years.
After Hassan Rouhani’s election in June 2013, the country reached a deal
with the P5+1 (the permanent five members of the United Nations Secu-
rity Council plus Germany) that promised to bring an end to the twelve-ye-
ar-old dispute over its nuclear programme. Consequently, Iran managed
to improve ties at the international level, engaging in direct talks with the
1. The present chapter is the outcome of a joint research effort, any single part
of it has been jointly discussed by the two authors before being written, and revised by
both afterwards. However the final draft of parts 1,2,6 has been written Aniseh Bassiri
Tabrizi and the final draft of parts 3,4,5 by Claudia Castiglioni.

Aniseh BAssiri TABrizi & ClAudiA CAsTiglioni
United States, resuming diplomatic relations with the United Kingdom,

and attracting an increasing number of political and trade delegations
to Tehran from all over the world. In the aftermath of the nuclear agree-
ment, Iran focused on regional issues. By securing a seat at the Syria peace
talks in Vienna, it has been recognised for the first time as «part of the
solution» of the current crises in the Middle East. This successful record
on foreign policy issues, however, was not matched by developments on
the domestic front. Despite rising expectations by the Iranian populations
after the Rouhani’s advent to power, in particular with regard to political
and social freedom and to the improvement of the economic situation of
the country, the government did not manage to achieve its stated goals.
Starting from these premises, the article explores the major changes
introduced by Rouhani and his Cabinet in the past two years in the social,
economic, political, and diplomatic sphere. In so doing, it addresses the
complexities of Iran’s political system and power hierarchy, most notably
the relation between President Hassan Rouhani and the Supreme Leader
Ayatollah Ali Khamenei, the impact of the nuclear deal on the domestic
front and the recent hardliners’ attempts for a comeback to the Iranian po-
litical scene. It starts with an analysis of the negotiations on the Iranian nu-
clear programme, assessing the steps that first led to the interim agreement
and then to the Joint Comprehensive Plan of Action (JCPOA). The authors
opted for starting their analysis with the nuclear dossier because this con-
stituted the priority of the Rouhani administration since it was elected in
June 2013. Furthermore, the nuclear negotiation development and outco-
me strongly affected the government’s room for manoeuvre on the dome-
stic, economic, and international front. The rest of the analysis is devoted
to the evolution of Iran’s foreign policy beyond the nuclear issue and to an
assessment of the changes occurred in the economic, social, political, and
cultural spheres in the past two years.
2. The Iranian nuclear issue: Steps and outcome of two years of talks
Iran started January 2014 on the right foot with regard to the nuclear
issue. Only a few months after the election of President Hassan Rouhani,
Iran sealed an interim deal with the P5+1, known as the Joint Plan of
Action (JPOA).2 This constituted the first agreement reached by the nego-
tiating parties since 2004, when the E3 (the United Kingdom, France and
Germany) and Iran signed the Paris Agreement.3 The deal was the result
2. European Union External Action Service, Joint Plan of Action, Geneva, 24

November 2013 (http://eeas.europa.eu/statements/docs/2013/131124_03_en.pdf).
3. Communication dated 26 November 2004 received from the Permanent
Representatives of France, Germany, the Islamic Republic of Iran and the United
Kingdom concerning the agreement signed in Paris on 15 November 2004, INF-
502
Iran 2013-2015
of a number of factors. The opening of the US administration to enabling

uranium enrichment on Iranian soil constitutes one of the main elements
that triggered the agreement between the two sides, but being beyond
the purpose of this article it will not be discussed.4 The other main factor
facilitating the sealing of the interim deal was the election of Rouhani.
On 14 June 2013, defying most expectations, Rouhani won Iran’s 11th
presidential elections, succeeding to Mahmood Ahmadinejad. Rouhani is
a moderate cleric who held senior positions within the establishment, who
had represented the Supreme Leader Ali Khamenei on security-related
issues for more than 16 years in the Supreme National Security Council
(SNSC). Despite having built a strong working relationship with the Ira-
nian leadership, Rouhani run on a campaign of «moderation and pruden-
ce», which attracted a large amount of votes from reformist sections.5 In
his electoral programme, Rouhani highlighted the necessity to improve
relations with regional and international powers, prioritising, in particular,
the resolution of the nuclear issue as a crucial element facilitating rappro-
chement with the West.6 The newly elected president was familiar with the
nuclear dossier, which he had handled, as chief nuclear negotiator, betwe-
en 2003 and 2005, when the issue first became an international concern.
Rouhani’s nickname – «diplomatic sheikh» – was an indicator of the con-
ciliatory approach the president was known for, particularly with regard to
the nuclear issue. In the presidential debates before being elected, Rouhani
sharply criticised the confrontational approach adopted toward the nego-
tiating parties, the P5+1, by the previous administration and, in particular,
by previous Iran’s nuclear chief negotiator, Saeed Jalili.7 Rouhani stressed
CIRC/637, 26 November 2004 (https://www.iaea.org/sites/default/files/publications/

documents/infcircs/2004/infcirc637.pdf). Under the agreement, Iran voluntarily
implemented the International Atomic Energy Agency’s Additional Protocol and
temporarily suspended all enrichment and reprocessing activities in exchange for
economic and technical cooperation from the E3.
4. Since the beginning of the crisis in 2003, Iran’s red line has been the estab-
lishment of an indigenous enrichment programme as an imperative to enter moder-
nity and to be recognised as a power in the region. In 2013, the US administration
has for the first time changed its rejection of the Iranian «right to enrich», finally
accepting, in the JCPOA, that Iran could keep a «mutually defined enrichment pro-
gramme with mutually agreed parameters consistent with practical needs».
5. Kasra Naji, ‘Profile: Hassan Rouhani, President of Iran’, BBC, 5 August
2013.
6. Najmeh Bozorgmehr, ‘Rohani’s landslide victory spreads hope of moderate
policies’, Financial Times, 15 June 2013; ‘Great Expectations: Iran’s New President
and the Nuclear Talks’, Middle East Briefing, No. 36, Washington/Brussels, 13 August
2013 (http://www.crisisgroup.org/~/media/Files/Middle%20East%20North%20Afri-
ca/Iran%20Gulf/Iran/b036-great-expectations-irans-new-president-and-the-nuclear-
talks.pdf).
7. Barbara Slavin, ‘«Engineered» Iranian Elections Provide an Opening for
Criticizing Status Quo’, The Huffington Post, 6 September 2013.
503
the need to return to a confidence-building approach, reversing the aggres-

sive rhetoric adopted under president Ahmadinejad. Questions were thus
immediately raised about what his victory meant for Iran’s foreign policy
posture, particularly with regard to the nuclear issue.
According to Article 110 of the Iranian Constitution, the Supreme Lea-
der constitutes the central institution with regard to all key national security
and foreign policy issues, matters on which his word is final.8 Presidential
powers are, on the other hand, constitutionally limited.9 Nevertheless, by
chairing the SNSC – a key institution in shaping national security and fo-
reign policy matters – the president can still have a strong impact on the
country’s international posture and overall approach toward the West; also
he can channel new diplomatic initiatives and set Iran’s tone as far as inter-
national affairs are concerned.10
As a cleric who covered high-ranking positions in the Iranian regime,
Rouhani was expected to have the power to influence Iran’s foreign policy.
To demonstrate his commitment to change Iran’s approach to the nuclear
negotiations, Rouhani took two practical steps in the first few weeks after
being elected. Firstly, he removed the management of the nuclear dossier
from the SNSC, which had been in charge of the file since 2003, handing
the responsibility to the Ministry of Foreign Affairs. The decision was due
to the tighter control the president has over the Ministry’s appointees
and to the need of simplifying the decision-making process over the mat-
ter.11 Secondly, Rouhani nominated a new and more moderate negotiating
team, led by the newly appointed Foreign Minister, Mohammad Javad Za-
rif. A US-educated diplomat who had handled the dossier between 2003
and 2005, Zarif was viewed by the international community as a «pragma-
tic» diplomat because of his previous post as Iran’s representative at the
United Nations.12 Shortly after the new President undertook these chan-
8. The Constitution of the Islamic Republic of Iran, Chapter VIII, Article 110
(http://www.iranchamber.com/government/laws/constitution_ch08.php); Abbas Male-
ki, ‘Decision Making In Iran’s Foreign Policy: A Heuristic Approach’, Journal of Social
Affairs, Vol. 19, No 73, Spring 2002, p. 49.
9. The Constitution of the Islamic Republic of Iran, Chapter IX, Article 125
(http://www.iranchamber.com/government/laws/constitution_ch09.php). His posi-
tion mostly requires the President to sign and supervise the implementation of laws,
treaties, and international agreements ratified by the Parliament (Majles-e Showra-ye
Eslami).
10. Besides chairing the SNSC (Shura-ye Ali-ye Amniyat-e Melli), the president
also selects the body’s Secretary and committees’ heads, thus influencing the nature
of Iran’s international posture. The Constitution of the Islamic Republic of Iran,
Chapter XIII, Article 176 (http://www.iranchamber.com/government/laws/constitu-
tion_ch13.php).
11. ‘Iran’s conservatives silent as Rouhani puts nuclear talks on diplomatic
footing’, The Guardian, 12 September 2013.
12. ‘New Team to Head Nuclear Talks’, USIP The Iran Primer, 23 September
2013 (http://iranprimer.usip.org/blog/2013/sep/23/new-team-head-nuclear-talks).
504
Iran 2013-2015
ges, Khamenei stated in a speech to the Iranian Revolutionary Guards

Corps (IRGC) that he was not against diplomacy and supported the idea
of «heroic flexibility» in diplomacy.13 The election of Rouhani thus raised
hopes about the prospects of finding a diplomatic solution to the nuclear
dossier. A few months later, once the signing of the interim agreement
with the P5+1 was announced, it seemed that domestic and international
expectations were going to be met.
Under the JPOA, the two sides committed to reaching a comprehen-
sive agreement on the Iranian nuclear issue within six months, closing the
dossier that had been on the radar of the international community for more
than a decade by 20 July 2014. Few days into 2014, on 20 January, the pro-
visions of the JPOA entered into force. Iran started to scale back parts of its
nuclear programme, while, in return, the United States and the European
Union agreed to relax some of their unilateral sanctions against Tehran.14
This represented a major breakthrough, not only for the resolution of the
nuclear dossier but also for the improvement of Iran’s relations with the
West.
Few months after the implementation of the interim agreement, the
nuclear watchdog of the United Nations, the International Atomic Ener-
gy Association (IAEA), issued a report, which highlighted how Iran was
meeting its end of obligations under the JPOA, in what constituted the
first group effort with the Agency since 2008.15 Once the report confirmed
that Iran was curbing its most sensitive nuclear activities, in line with what
agreed with the six powers in November 2013, international confidence
over the ability of the Rouhani administration to deliver on its promises on
the nuclear issue further increased.
Despite the positive momentum, the P5+1 and Iran missed twice
their set deadline to reach a comprehensive nuclear agreement in 2014.
In July, after the negotiators spent three intense weeks in Vienna’s Palais
13. Arash Karami, ‘Khamenei «Not Opposed» to Diplomacy, Flexibil-

ity’, Al-Monitor, 17 September 2013 (http://iranpulse.al-monitor.com/index.
php/2013/09/2834/khamenei-not-opposed-to-diplomacy-flexibility).
14. Council of the European Union, Iran: EU suspends certain sanctions as Joint
Plan of Action enters into force, 5321/14, Brussels, 20 January 2014; U.S. Department
of State, Briefing on Iran and Implementation of the Joint Plan of Action, Office of the
Spokesperson, Senior Administration Officials, Washington DC, 20 January 2014
(http://www.state.gov/r/pa/prs/ps/2014/01/220058.htm); U.S. Department of the
Treasury, Frequently Asked Questions Relating to the Temporary Sanctions Relief to Imple-
ment the Joint Plan of Action between the P5 + 1 and the Islamic Republic of Iran, 20 Jan-
uary 2014 (https://www.treasury.gov/resource-enter/sanctions/Programs/Documents/
jpoa_faqs.pdf).
15. International Atomic Energy Agency, Implementation of the NPT Safeguards
Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of
Iran, GOV/2014/28, 23 May 2014 (https://www.iaea.org/sites/default/files/gov2014-28.
pdf).
505
Coburg, attempting to meet the original expiry date, it was eventually

decided to extend the JPOA and talks for four additional months.16 On 24
November, the negotiators announced a second extension, which, howe-
ver, required the parties to reach a political agreement within four months
and to complete the necessary technical annexes by the end June 2015.17
The failure to find a compromise was perceived as a setback by most obser-
vers, a signal that, despite the initial hopes, a peaceful solution to the
nuclear issue remained far away.18 The Iranian administration grew incre-
asingly impatient with the subsequent extensions of the JPOA. Since the
resolution of the nuclear issue was depicted by Rouhani and his team as
the first priority of the administration and a precondition to gain a bigger
margin of manoeuvre on other matters, both domestic and international,
the presidency and the foreign ministry increasingly found it difficult to
maintain their legitimacy and support from within Iran. Beginning with
spring 2014, as the Rouhani administration was getting close to celebrate
one year in power, the government was consistently subject to forceful cri-
ticism by the hardliners. In May, a newly established group of right-wing
Members of Parliament, which called itself «We’re Worried», complained
about the posture of Iran’s negotiating team and their disregard for na-
tional interests in the nuclear talks.19 The level of pressure exerted on the
negotiating team further increased in the following months. When the
second extension of the JPOA was announced in November, the Iranian
ultra-conservative newspapers Kayhan ran the headline «Village headman
16. European Union External Action Service, Joint Statement by EU High Repre-
sentative Catherine Ashton and Iranian Foreign Minister Mohammad Javad Zarif, Vienna,
19 July 2014 (http://eeas.europa.eu/statements/docs/2014/140719_01_en.pdf); U.S.
Department of the Treasury, Frequently Asked Questions Relating to the Extension of Tempo-
rary Sanctions Relief to Implement the Joint Plan of Action between the P5 + 1 and the Islamic
Republic of Iran, 21 July 2014 (https://www.treasury.gov/resource-center/sanctions/Pro-
grams/Documents/jpoa_guidance_ext.pdf); Laura Rozen, ‘Iran, P5+1 extend talks’,
Al-Monitor, 18 July 2014 (http://www.al-monitor.com/pulse/originals/2014/07/iran-
p51-talks-extension-vienna-4-months.html).
17. European Union External Action Service, Joint Statement by Catherine
Ashton and Iranian Foreign Minister Mohammad Javad Zarif following the talks in Vi-
enna, 24 November 2014, 24 November 2014 (http://eeas.europa.eu/statements-ee-
as/2014/141124_02_en.htm); U.S. Department of the Treasury, Guidance Relating to
the Provision Of Certain Temporary Sanctions Relief in Order to Implement the Joint Plan of
Action Reached On November 24, 2013 Between The P5+1 and The Islamic Republic Of
Iran, as Extended Through June 30, 2015’, 25 November 2014 (https://www.treasury.
gov/resource-center/sanctions/Programs/Documents/guidance_ext_11252004.pdf).
18. For the remaining sticking points to reach an agreement, refer to Aniseh
Bassiri Tabrizi, ‘Iran Nuclear Deal: A Miracle is Still Possible’, Heartland, 7 October
2014 (http://temi.repubblica.it/limes-heartland/2046/2046).
19. Simon Tisdall, ‘Hassan Rouhani faces growing criticism in Iran over nuclear
talks’, The Guardian, 4 May 2014; Garrett Nada, ‘Rouhani Under Fire’, USIP The Iran
Primer, 15 May 2014 (http://iranprimer.usip.org/blog/2014/may/15/rouhani-under-fire).
506
Iran 2013-2015
[United States] wasn’t trustworthy, sanctions extended», indicating not

only that Iran did not gain any concessions from talks with the P5+1,
but also that the international sanction regime against Tehran did not
halt.20 Another hard-line newspaper, Vatan-e-Emrooz, titled his cover page
«Nothing», and argued that the talks with the six powers did not translate
into the results Rouhani wanted to achieve.21
Criticism toward the negotiating strategy of the new administration
started to increase also because, despite the limited and reversible sanction
relief granted under the JPOA by the EU and the United States, Iran did
not gain the economic benefits it was expecting.22 A large number of trade
delegations, especially from European countries, visited Tehran once the
interim agreement came into force to explore opportunities in the Iranian
market and to assess whether new deals could be arranged.23 However, be-
cause of the nature of the US legislation against Iran still in place, no new
contracts were signed.24
Despite the increasing rants about the outcome of negotiations, the
Rouhani administration managed to avoid any interference of hardliners
on talks with the P5+1, an achievement, which in itself was remarkable. To
rebuff the criticism, Foreign Minister Zarif stated that his team had the full
mandate to pursue negotiations according to the guidelines set by Khame-
nei.25 In a televised address to the nation, Rouhani stated that as a result of
engagement with the international community «no one in the world ha[d]
any doubt that Iran must have nuclear technology, including enrichment on
its soil, and no one ha[d] any doubt that sanctions must be lifted».26
20. ‘Vienna Nuke Talks: Iran Hardliners React’, USIP The Iran Primer, 25 No-
vember 2014 (http://iranprimer.usip.org/blog/2014/nov/25/vienna-nuke-talks-iran-
hardliners-react).
21. ‘Khamenei: Iran won’t be brought to knees’, Agence France Press, 25 No-
vember 2014 (http://www.alaraby.co.uk/english/news/2014/11/24/khamenei-iran-won-
t-be-brought-to-knees).
22. The US administration assessed that sanction relief would have been worth
in total about $6-7 billion. The White House, Office of the Press Secretary, Background
Briefing by Senior Administration Officials on First Step Agreement on Iran’s Nuclear Pro-
gram, 24 November 2013 (https://www.whitehouse.gov/the-press-office/2013/11/24/
background-briefing-senior-administration-officials-first-step-agreement).
23. Thomas Erdbrink, ‘Sanctions Eased, Iran Gets Feelers From Old Trading
Partners’, The New York Times, 17 January 2014; ‘Iran welcomes French business chiefs
after sanctions eased’, Reuters, 3 February 2014.
24. George Parker, ‘US «bullying»UK banks and hindering legal trade with
Iran’, Financial Times, 26 March 2014; Jonathan Tirone, ‘Europeans Irked by U.S.-
Iran Trade as Companies Suffer’, Bloomberg, 4 June 2014.
25. Mehrdad Balali, ‘Iran’s Khamenei backs nuclear talks but not optimistic’,
Reuters, 17 February 2014.
26. President Rouhani in a TV interview: ‘Iranian nation will continue seriously
till achieving a final comprehensive agreement / sanctions on Iran will not bear fruit’,
24 November 2014 (http://www.president.ir/en/82630).
507
2015, therefore, started with less optimism with regard to the chances
of the Iranian government to close the nuclear dossier once for all. Ho-
wever, on 2 April 2015, 18 months after the JPOA was signed, the P5+1
and Iran announced that a «framework» agreement was reached, and made
public the key points of a comprehensive deal.27 The agreement, which was
the result of complex negotiations and of an unprecedented number of con-
secutive days spent by the parties in Lausanne discussing the remaining
sticking points, was defined by Zarif and EU High Representative Federica
Mogherini as a «decisive step», and constituted the basis of discussions on a
comprehensive nuclear deal for the following three months. The announce-
ment was welcomed with celebrations in Tehran, ranging from cars driving
through the streets and honking horns, to citizens welcoming the negotia-
ting team at the airport or chanting «Thank you, Rouhani».28 In spite of
few exceptions, the agreement was also supported by hardliners previously
critical of engagement with the West, because it enabled Iran to meet Iran’s
two red lines – the preservation of existing centrifuges and the acceptance
of the country’s «right» to enrich uranium on its soil.29
Only three months after the Lausanne agreement, Iran and the P5+1
reached the Joint Comprehensive Plan of Action (JCPOA).30 The agree-
ment was a complex document which sets out 5 different phases after which,
in about 10 years time, the agreement will be terminated. The «finalisa-
tion day», namely day when the deal was announced, was followed by the
approval by the UN Security Council, the US Congress, and the Iranian
Parliament (the Majlis) of the agreement.31 On 18 October 2015, once all
three steps were made, the parties announced the second phase of the deal,
27. U.S. Department of State, Office of the Spokesperson, Parameters for a Joint
Comprehensive Plan of Action Regarding the Islamic Republic of Iran’s Nuclear Program, 2
April 2015 (http://www.state.gov/r/pa/prs/ps/2015/04/240170.htm).
28. Babak Dehghanpisheh, ‘Iranians celebrate announcement of framework
agreement’, Reuters, 2 April 2015; ‘Iranians hail nuclear deal as diplomats return in
triumph’, al-Araby, 3 April 2015.
29. Babak Dehghanpisheh & Ori Lewis, ‘Iran president views nuclear deal as
start of new relationship with world’, Reuters, 4 April 2015.
30. ‘Joint Comprehensive Plan of Action’, 14 July 2015 (http://eeas.europa.
eu/statements-eeas/docs/iran_agreement/iran_joint-comprehensive-plan-of-action_
en.pdf).
31. The UN Security Council adopted its resolution endorsing the JCPOA on
20 July 2015. ‘Security Council, Adopting Resolution 2231 (2015), Endorses Joint
Comprehensive Agreement on Iran’s Nuclear Programme’, SC/11974, 7488th Meet-
ing (http://www.un.org/press/en/2015/sc11974.doc.htm). Despite significant concerns,
the US Congress then also approved the agreement on 17 September 2015. Patricia
Zengerle, ‘Last bid to kill Iran nuclear deal blocked in Senate’, Reuters, 17 September
2015. Finally, the Iranian parliament passed the bill endorsing the JCPOA on 13
October 2015. Saeed Kamali Dehghan, ‘Iranian parliament passes bill approving
nuclear deal’, The Guardian, 13 October 2015.
508
Iran 2013-2015
«adoption day».32 In the last months of 2015, Iran moved toward meeting
its obligations under the JCPOA, curbing its most sensitive nuclear activities
and cooperating closely with the IAEA to address concerns about the milita-
ry nature of the country’s nuclear programme.
Completion of the Iranian obligations constituted a real priority for
the Rouhani administration, which, after having sealed a historic nuclear
agreement in July 2015, thus fulfilling one of its key electoral promises, now
wanted to deliver on its second priority, the improvement of the Iranian
economy. This was intertwined with ending the international isolation from
the global financial market under which the country found itself since 2010,
when EU and US unilateral sanctions were imposed.33 Under the JCPOA,
these sanctions were going to be lifted only once Iran met its end of obli-
gations, triggering phase three of the JCPOA, known as «implementation
day». Since Rouhani aimed at countering any remaining opposition toward
his nuclear diplomacy and the negotiations’ outcome, Iran moved quickly
toward curbing its nuclear activities, aiming at having sanctions lifted at the
beginning of 2016.
Because of its successful nuclear diplomacy, Iran found itself in a very
different place compared to two years before. The administration gained
the trust and respect of the international community, and this in turn af-
fected Tehran’s relations with the West on regional issues, as discussed be-
low. Rouhani and the nuclear team also gained the support of the Iranian
population that, attracted by the prospects of better standards of life and
normalisation of ties with the West, endorsed the outcome of the negotia-
tions, strengthening the administration’s support basis. Much of this out-
come was the result of the unprecedented political capital invested by both
the US and the Iranian administrations in reaching the deal. The commit-
ment of US president Barack Obama to prioritise diplomacy in solving the
nuclear dossier has played a crucial role in containing the efforts of some
influential regional actors, Israel in particular, to derail the negotiation pro-
cess. By pushing back on issues such as the «breakout time» – the time requi-
red to produce enough weapons-grade uranium for one single bomb – and
by emphasising how the deal increased the security of all countries in the
Middle East, the Obama administration has made it possible for Rouhani to
32. European Union External Action Service, Joint Statement by EU High Rep-
resentative Federica Mogherini and Iranian Foreign Minister Javad Zarif, 151018_01,
Brussels, 18 October 2015 (http://eeas.europa.eu/statements-eeas/2015/151018_01_
en.htm).
33. The EU sanctions, which strongly affected the Iranian economy, included
the Council of the European Union, Council Decision 2012/35/CFSP amending Decision
2010/413/CFSP concerning restrictive measures against Iran, 23 January 2012; The Coun-
cil of the European Union, Council Regulation 267/2012 concerning restrictive measures
against Iran, 23 March 2012; The Council of the European Union, Council Decision
2012/635/CFSP amending Decision 2010/413/CFSP concerning restrictive measures against
Iran’, 15 October 2012, Brussels.
509
sell the deal at home, side-lining domestic criticisms.34 As explained in the

following sections, the administration’s success on the nuclear front was not
matched in other issues.
3. Iran’s foreign policy beyond the nuclear issue
The signing of the nuclear agreement with the P5+1 affected Iran’s
foreign policy in various ways. First and foremost, the deal had a profound
impact on the country’s relations with the West, notably the United States
and some key Western European countries. Rouhani entered office stressing
the importance of re-opening the dialogue with his Western counterparts,
a step he considered vital for the resolution of the nuclear crisis and the
normalisation of Iran’s relations with the international community.35 The
president’s so called «charm offensive», including his phone call with Presi-
dent Obama and his conciliatory remarks before the UN General Assembly
in September 2013, can be placed in this context.36 In his efforts to win the
trust and respect of those who continued to look with suspicion at Iran’s new
international posture, Rouhani was assisted and supported by his Foreign
Minister, Mohammad Javad Zarif, whose diplomatic experience and soft
manners soon earned him a widespread popularity. As the Iran and the
P5+1 worked towards a comprehensive agreement that could finally solve
the dispute over Tehran’s nuclear programme, a few bricks of the decades-
old wall of distrust began to fall. However, it was not until the signature the
JCPOA in July 2015 that this new climate of hope started to translate into
a new political phase: the failure to meet two deadlines for the final agree-
ment in July and in November 2014 suggests that many obstacles remained
on the road to a deal and that success was not to be taken for granted.
Yet, the goal was eventually accomplished. The agreement achieved
in Vienna undoubtedly represented a game changer in Iran’s relations with
the West. The JCPOA and the determination shown by the parties in over-
coming the difficulties that arose during the negotiations, though not me-
aning the complete dismissal of reciprocal suspicions and concerns, have
undoubtedly inaugurated a new phase in Iran’s relations with its Western
counterparts. By the end of 2015, the new atmosphere of collaboration re-
sulted in mounting interest by European companies in re-entering Iran’s
market, in the improvement of ties with EU countries, and in a timid rap-
prochement with the United States.
34. Jessica Sculberg, ‘John Kerry: Iran Nuclear Deal Is Good For Israel’s Secu-
rity’, The Huffington Post, 24 July 2015.
35. Gideon Rachman & John Aglionby, ‘Hassan Rouhani outlines plan for
Iran’s growth for next decade’, Financial Times, 23 January 2014.
36. ‘Iran’s Charm Offensive’, The New York Times, 24 January 2014.
510
Iran 2013-2015
Already in the months following the signature of the interim agree-

ment, Western companies, particularly from European countries, organised
a large number of visits to Tehran to test the ground on re-entering Iran’s
attractive market. In February 2014, for instance, more than 100 French
companies visited Iran, including major names such as Total, Renault, and
Peugeot, car manufacturers that were active in Iran before sanctions were
imposed. Other countries, such as Belgium, Germany, Italy, and Austria,
soon sent their trade delegations to Tehran. As a consequence, also political
ties between Iran and European countries have intensified since the begin-
ning of 2014. Trade delegations were often accompanied by political ones,
in many cases of senior officials visiting Iran for the first time in many years.
Furthermore, the UK decided to re-open its Embassy in Tehran that had
been closed since November 2011, after it was stormed by an unidentified
crowd of Iranian protesters. The French embassy in Tehran subsequently
reversed the decision to cut its personnel. The improvement of ties between
Iran and the West extended even to the United States. Besides the coopera-
tive attitude showed throughout the nuclear talks, facilitated by direct talks
between Kerry and Zarif ’s negotiating teams, the Obama administration for
the first time recognised Iran as «part of the solution» of current crises in
the Middle East, offering, after years of hesitation, a seat at the Syria peace
talks in Vienna to Tehran. The choice represented the first time in which the
United States chose to formally engage the Iranians diplomatically on this
issue, a decision that denotes a gradual but undeniable shift in Washington’s
strategy in the region and in US-Iranian relations.37
This brings us to the second set of consequences produced by the nu-
clear deal on Iran’s foreign policy: those related to the regional scene. Du-
ring Mahmood Ahmadinejad’s eight years in power, many commentators
showed increasing confidence that Iran was on the verge of becoming the
new regional hegemon: Tehran’s dynamism in Central Asia, its decades-
long alliance with Hezbollah in Lebanon and with Assad’s regime in Syria,
its expanding support to Hamas, and, even more, its growing influence in
neighbouring Iraq and Afghanistan seemed enough to prove its gradual but
incontestable transformation into a regional power. In the past few years,
however, some new developments altered this scenario, first and foremost
the rise and rapid expansion of the Islamic State (also known as ISIS or
DAESH). Tehran did not reduce the nature and the extent of its commit-
ments abroad. Nevertheless, the situation changed; in the words of a well
known American academic: «its forces have lost more and more territory in
Syria […] in Iraq, the government that they backed went from controlling
the country, nominally all of the country to actually losing control of large
parts of it. And then even if you looked at Lebanon, the combination of
37. Thomas Erdbrink, Sewell Chan & David E. Sanger, ‘After a U.S. Shift, Iran
Has a Seat at Talks on War in Syria’, The New York Times, 28 October 2015.
511
refugee crisis which has changed the demographics of Lebanon, it actually

has put Hezbollah in a very complicated situation of being engaged in a
very unpopular war in Syria where there has been quite a lot of bleeding in
Hezbollah.»38 Despite the territorial losses and military toll Iran had to pay,
the rise of ISIS did not mean only a deterioration of Tehran’s position in
the region. The strengthening of the Islamic State and the escalation of ten-
sions in the Levant provided the Iranian authorities with a further justifica-
tion to keep their forces both in Syria and in Iraq. The defence of Baghdad
by the Shia militias trained and financed by Tehran received Washington’s
de facto endorsement, something that would have never been possible until
a couple of years ago. The fate of General Soleimani offers a revealing case
in point in this regard: leader of the special forces unit of Iran’s Revolu-
tionary Guards responsible for their extraterritorial operations, the Quds
forces, the so-called «Shadow Commander» shifted from being seen as one
of the main threats to the regional and international security to receiving
US protection and support in its war against the Islamic State. In this sense
the emergence of the ISIS threat represented both a setback and a strategic
advantage for Iran.
In this situation, the achievement of the JCPOA produced two sets
of effects: on the one hand, it further exacerbated the tensions with the
countries that opposed the deal, particularly with Israel and Saudi Arabia.
Both felt that they were not given enough say in the negotiations that led to
the Vienna agreement and were clearly unhappy at the loss of their leverage
vis-à-vis the United States concerning the management of regional crises,
most notably their vetoing power regarding Iran’s participation to the ne-
gotiations over the future of Syria. On the other hand, Tehran’s boosted
legitimacy, epitomised by its aforementioned inclusion in the Vienna talks,
reinforced Tehran’s standing and diplomatic role in the region, encoura-
ging the Iranian leadership to present itself as an indispensable partner in
the fight against ISIS and to improve its relations with the other regional
players.
The rapprochement with Washington and Western Europe and the
end of Iran’s diplomatic isolation provide encouraging signs for the futu-
re of Tehran’s relations vis-à-vis the international community. However, it
is also important to notice that these efforts still fall short of indicating a
complete reintegration of Iran in the international community and a full
acknowledgment of its role by other states in the region. Despite reports
on Tehran’s coordination on the ground with US forces to deal with ISIS in
Iraq,39 obstacles remain for instance when it comes to the country’s colla-
38. Vali Nasr’s remarks at the event organised by the Brooking Institution: ‘Un-
derstanding Iran Beyond The Deal’, Washington, DC, 15 October 2015 (http://www.
brookings.edu/events/2015/10/15-understanding-iran-beyond-deal).
39. On this point see: Dina Esfandiary & Ariane Tabatabai, ‘Iran’s ISIS policy’,
International Affairs, Vol. 91, Issue 1, 2015, pp. 1-15.
512
Iran 2013-2015
boration with the West on issues such as Yemen or the future of the Assad
regime in Syria. The conflict in Yemen, in particular, is one of the most
contested terrains of Iran’s involvement in the Middle East. The country,
where the Zaidi Shia community represent more than 40% of the popula-
tion, witnessed in the past two years a revival of the conflict between the
government in Sana’a and the Houthis, a Shia insurgent group originally
from the north of the country.
In September 2014 the Houthis took control of the capital and of a
significant part of Yemen’s territory, leading to the fall of the Saudi backed
government. Their military successes triggered Saudi reaction: Riyadh in-
tervened to contrast the advance of the Houthis, and launched a campaign,
together with the Yemeni government, to denounce Iran’s alleged support
to the group. Such allegations contributed to growing speculations about
the fighting in Yemen as a proxy war between Iran and Saudi Arabia. These
speculations appear, however, exaggerated: while it’s true that reports have
increasingly proved Tehran’s military and financial help to the Houthis,
Iran’s leverage on the local actors continued to be limited, especially in
comparison to what claimed by the Saudis. «Its [Iran’s] support for the
Houthis – has argued Rouzbeh Parsi – has not been a game changer nor
has it influenced the group in any particular direction since, irrespective
of Tehran’s ambitions, the conflict in Yemen is home grown and structural,
having played out over several decades. What this support has achieved is of
course to cement Saudi fears and draw Riyadh further into a quagmire it has
been skirting around for many years.»40 As for Syria, the country remains an
integral part of Iran’s «forward defense policy.»41 Tehran did not withdraw
his presence on the ground. However, Syria has been costly to Iran – both
financially and in terms of reputation – and Iranians, particularly within the
Rouhani administration, have seemed more inclined to consider a transitio-
nal process which would not require them to compromise the country’s na-
tional interests.42 This confirms the idea whereby Iran’s actual behaviour is
«much more pragmatic and reactive than the accompanying rhetoric would
let on.»43
In other words, the deal with the P5+1 did not assure a more coope-
rative attitude by Iran towards a series of problems, from the fate of Bahar
al-Assad to human rights, nor did it prevent a further escalation of tensions
with its regional enemies, as testified by the recent storming of the Saudi
Embassy in Tehran in reaction to the execution of Sheikh Nimr al-Nimr, a
40. Rouzbeh Parsi, ‘The Middle East and the Deal: In Search of a New Bal-
ance’, in Paolo Magri & Annalisa Perteghella, Iran after the deal: the road ahead, ISPI
REPORT, September 2015, pp. 70-71.
41. Charlotte Alfred, ‘How The Nuclear Deal Will Affect Iran’s Foreign Policy’,
The Huffington Post, 17 July 2015.
42. Ibid.
43. Rouzbeh Parsi, ‘The Middle East and the Deal’, p. 71.
513
leading Shiite cleric who had criticised the kingdom’s treatment of its Shiite
minority.44 However, the settlement of the nuclear crisis has made it possi-
ble to shift from seeing a rise in Iran’s stature as an entirely hostile deve-
lopment to acknowledging the possibility of using Tehran’s influence to lay
the bases for a new policy in the Middle East. This, in turn, encouraged the
most pragmatic elements of the Iranian leadership to act as viable and cre-
dible partners in the search for new paths for the pacification of the region.
The events that, at the very beginning of 2016, led to the occupation of
the Saudi Embassy in Iran on 3 January and to the rupture of the diplomatic
ties between Riyadh and Tehran are relevant in this regard. Not only they
demonstrated the extent of Saudi hostility towards the inclusion of Iran in
the inner circle of regional diplomacy, and the risks that this hostility poses
for the pacification of Yemen and Syria. They also indicated the numerous
ramifications of Iran’s domestic power struggles and their potential conse-
quences on Tehran’s foreign policy. Especially in the months after the nu-
clear agreement was signed, the Supreme Leader felt it had to balance the
legitimacy gained by the Rouhani administration, allowing radical forces to
bring Iran’s policy back on a path of confrontation with actors outside the
country, both within and outside the region. Because of that, for instance,
despite the participation of Iran’s Foreign Minister Javad Zarif in the talks
on Syria, the dossier has remained largely in the hands of the Iranian Re-
volutionary Guards, who have made of the survival of the Assad regime
their main priority. In spite of Rouhani’s determination in reinforcing the
country’s cooperative stance with the international community, which resul-
ted in Iran’s inclusion in the Syrian talks, together with the improvement of
Tehran’s ties with the West, the Rouhani administration did no manage to
gain the room for manoeuvre hoped for. The rupture of relations between
Riyadh and Tehran, followed by similar initiatives by the United Arab Emi-
rates, Bahrain, and Sudan among others, indicated that a complete shift of
Iran’s stance in the region remains hard to achieve. Similarly disappointing
has been the outcome of the administration on the domestic level.45
4. The social sphere and the fog of change
Whereas when looking at the nuclear issue and, more broadly, at Iran’s
foreign policy, the benefits of Rouhani’s pragmatic attitude in 2014 and
2015 have been evident, when it comes to the social, political, and eco-
nomic spheres, the progress made by his administration has been slower
44. ‘Iranian Protesters Ransack Saudi Embassy After Execution of Shiite Cler-
ic’, The New York Times, 2 January 2016.
45. Toby Craig Jones, ‘Saudi Arabia’s Dangerous Sectarian Game’, The New York
514
Iran 2013-2015
and seems to be caught in what Robin Wright calls the fog of change. «It’s
tempting simply to credit a visionary leader, the human spirit, or a histo-
rical trajectory», Wright pointed out. «Change, however, is often foggier. It
takes a convergence of causes also selfish, crudely commercial, strategically
pragmatic, and more reactive than altruistic.»46 The reasons are manifold,
and include the complexities of the decision making process in Iran, the
position of power enjoyed by conservatives and hardliners within some of
the key institutions such as the Assembly of Experts and the Judiciary, and
the very notion of change from within. It is not by chance that most of
the comparisons that have been made in the past two years with regard to
Rouhani’s plan of reform are with one of the most celebrated example of re-
formers from within: Mohammad Khatami.47 However, the comparison hi-
des substantial differences: as many observers pointed out, Rouhani is not a
reformism à la Khatami, as he was hastily defined in many Western media48;
nor he wants to reinvent the foundations of the Islamic Republic. According
to the authors of a 2013 interview to Iran’s president: «Rouhani is more
technocrat than cleric. He belongs to the conservatives’ pragmatic wing that
considers diplomatic engagement rather than confrontation essential to the
survival of the Islamic Republic. He makes little reference to religion and is
said to be particularly fond of studying statistics tables.»49
At the beginning of his mandate, Rouhani emphasised the importance
of de-securitising the atmosphere in the country, i.e. reversing the process
that has enabled the state to use extraordinary means in the name of secu-
rity. De-securitisation meant, first and foremost, the freeing of some pro-
minent political prisoners and the lifting of house arrest for Mir Hossein
Mousavi and Mehdi Karroubi, key figures in anti-regime street protests after
the disputed 2009 presidential election. Yet little was achieved: the situation
of political prisoners remained unvaried, also as a result of Khamenei’s pu-
blic condemnation of the government’s initial call for the release of Mou-
savi and Karroubi;50 moreover, the annual report on the death penalty in
2014 showed that the Iranian authorities had executed more than 1.193
people since the election of President Rouhani in June 2013, marking an
increase rather than a drop compared to the last phase of Ahmadinejad’s
46. Robin Wright, ‘The Iran Deal Wasn’t Revolutionary’, Foreign Policy, 1 De-
cember 2015 (http://2015globalthinkers.foreignpolicy.com/#!decision-makers/detail/
iran-deal-wasnt-revolutionary).
47. See in this regard: Zhand Shakibi, Khatami and Gorbachev: Politics of Change
in the Islamic Republic of Iran and the USSR, London & New York: I.B. Tauris, 2010.
48. Riccardo Redaelli, ‘Il ritorno dell’Iran’, Asia Maior 2013, pp. 35-56, p. 45.
49. Roula Khalaf, Lionel Barber & Najmeh Bozorgmehr, ‘FT Interview: Hassan
Rouhani’, Financial Times, 29 November 2013.
50. ‘Arash Karami, Khamenei representative rejects calls for Mousavi, Karroubi
release’, Iran Pulse, 1 December 2013.
515
mandate.51 The campaign of repression did not target only the reformists
or the opponents of the regime, but came to involve one of the founders of
the Islamic Republic: Ali Akbar Rafsanjani. In August 2015, after years of
attacks from the hardliners, his son Mehdi Hashemi presented himself at
Tehran’s Evin prison to serve a ten-year sentence on charges linked to em-
bezzlement, bribery and what state television called «anti-security issues».
The media coverage and the social media commentary of the episode were
a testament not only to the polarising position the Rafsanjani family holds
in Iranian politics today, but also to the intensity of the political struggle
and the pervasive role of Judiciary in it.52
Ayatollah Ali Khamenei showed limited but crucial support for Rouha-
ni’s initiatives on the nuclear issue, which included curbing hardliners from
sabotaging nuclear talks. However, he did not give the same backing to
Rouhani’s government on other issues, particularly on the domestic level.
Furthermore, constitutionally, prisons are controlled by the Judiciary, one
of the power bases of hardliners who, though small in number, used their
stronghold to block any meaningful political and cultural reforms.53
Similar observations can be made with regard to women’s rights and
to the problem of female unemployment. Rouhani’s initiatives have so far
included the appointment of some women as provincial governors, the no-
mination of the first female ambassador since the 1979 revolution (Marzieh
Afkham, Iran’s new representative in Malaysia), the increase of activities in
women-related NGOs, and the removal of restrictions on certain subjects in
higher education. Nevertheless, also on this matter, criticism from within re-
mains, and the widely publicised achievements hide a situation of persistent
disparities and violation of basic rights. Women in Iran still hold only 3% of
seats in Parliament;54 female unemployment in the age group between 18
and 24 is at 42.7%. According to Mohsen Ranani, professor at the University
of Esfahan, some 75% of female university graduates remain without an ap-
propriate job, and that is a heavy price for a country that is aiming to econo-
mic grow and where an average of 60% of university students are women.55
51. Data provided by the website: ‘World Coalition against Death Penalty’
(http://www.worldcoalition.org/iran-annual-death-penalty-statistics-rouhani-hanging-
human-rights.html).
52. Arash Karami, ‘Rafsanjani’s son enters prison amid media circus’, Al-
Monitor, 11 August 2015 (http://www.al-monitor.com/pulse/originals/2015/08/mehdi-
hashemi-rafsanjani-son-prison-evin.html).
53. Monavar Khalaj, ‘Human rights set aside while Rouhani seeks Iran nuclear
agreement’, Financial Times, 16 May 2014.
54. Data provided by the World Bank website (http://data.worldbank.org/indi-
cator/SG.GEN.PARL.ZS).
55. Bijan Khajepour, ‘Women can play larger role in Iranian economy’, Al-
Monitor, 26 March 2014 (http://www.al-monitor.com/pulse/originals/2014/03/iranian-
economy-wome n-reform.html).
516
Iran 2013-2015
The same goes for cultural freedom: reformists’ initial hopes for a cul-
tural flowering and an easing of internet censorship were not met in the
first two years of Rouhani’s mandate. Flourished during the two manda-
tes of Khatami, NGOs made a comeback between 2014 and 2015. During
Rouhani’s first year in office the number of registered NGOs in Iran rose
by 30% to 7,000. Most of the newly established NGOs focus on health, the
environment, and entrepreneurship, avoiding to address more controver-
sial topics such as human rights.56 In the atmosphere of rising expectations,
fuelled by the progress achieved by the administration in the negotiations
with the P5+1, hope spread that civil society and interest groups could have
helped the new president to achieve the reforms the country needed. «Whi-
le the democratic opposition within Iran still suffers from organisational
weakness and the lack of a unifying long-term strategy, – two analysts of
Iranian politics wrote in the Washington Post in April 2015 – the nuclear
breakthrough seems to have recharged the emotional battery of reformist
activists and supporters and contributed to an optimistic perception about
short-term electoral progress.»57
Yet, the picture remains gloomy when it comes to political rights. In
2014-2015, the Judiciary persisted in stopping reformist journalists from
publishing new newspapers. Social networks, such as Facebook and Twitter
and VChat, continued to be blocked. Furthermore, while some moderate
politicians were appointed to regional governorships, there are few promi-
nent reformists in Rouhani’s administration.
The struggle for cultural freedom, which represents one facet of the
wider battle between the president and its opponents, was particularly fierce
in the capital Tehran, where the president and conservative Mayor Moham-
mad Bagher Qalibaf (who lost the presidential election both to Ahmadi-
nejad in 2005 and to Rouhani in 2013) clashed over the limits of the new
climate of relaxation of the city’s cultural life. In December 2015, the reo-
pening of the Tehran Museum of Contemporary Art and the debates over
possible collaborations with some foreign partners spread hopes for the be-
ginning of a new phase in Iran’s social and artistic scene, similar to what
happened in 1997, following the election of Khatami.58 Earlier in the year,
during his visit to Tehran’s prestigious book fair, president Rouhani raised
the thorny issue of censorship.59 Though not directly challenging the tight
control imposed on authors, Rouhani called for simplifying the guidelines
56. Monavar Khalaj, ‘Iran’s Rouhani softens stance on NGOs’, Financial Times,
28 August 2015.
57. Mohammad Ali Kadivar & Ali Honari, ‘Iran’s grass-roots politics and the
nuclear deal’, The Washington Post, 6 April 2015.
58. Arsalan Mohammed, ‘Iran and the art of Détente’, Financial Times, 4 De-
cember 2015.
59. Monavar Khalaj, ‘Censors allow Iran’s book publishers a taste of freedom’,
Financial Times, 12 June 2015.
517
that regulate the publishing process in Iran, guidelines that became much
stricter after the approval of a some related rules in April 2010.60 Yet, the
road remains long and full of obstacles, not only because of the complex
maze of Iranian politics, but also as a result of all the steps forward that
were made in the past few years. «For every liberalising move like this, – an
Iranian journalist commented in December 2015 – the conservatives will
get mad and want to take something back. So, this being Iran, you can only
count on the fact that nothing will go as planned.»61
The chances of meaningful progress in the social sphere have been
further reduced by the priority attached from the very beginning by
Rouhani and by his entourage to the achievement and implementation of
the nuclear deal with the P5+1. The political capital they invested in the
diplomatic marathon that culminated with the Vienna agreement parado-
xically translated into less negotiating leverage vis-à-vis other internal key
powers and actors in the social field. As mentioned in the previous section,
Khamenei had indeed to re-balance the gains obtained by the administra-
tion on the nuclear front, providing more power to the opposite factions
on other issues, such as de-securitisation within Iran. «Other than foreign
policy and nuclear negotiations and to some extent the economy, it is dif-
ficult to find out what the government’s policies in cultural and political
fields are» noticed a reform-minded analyst in January 2014.62 The pres-
sure on the reformist and moderate forces did not only result in growing
frustration among those who supported Rouhani in the hope he would
introduce meaningful change in the political and social life of the country.
It also risks weakening their position in the coming elections. At the end
of February 2016, Iranian citizens will be called to elect both the members
of the next Majles (Parliament), currently dominated by the conservatives,
and the Assembly of Experts, which might have to choose the successor of
Supreme Leader Ayatollah Ali Khamenei. The vote will be a test of confi-
dence for the government and for its conduct, after two years and a half in
power. At the same time the elections will be decisive in setting the tone of
the political struggle in Iran, delimiting the playground where a series of
key battles will be fought. These include the hardliners’ possible comeback,
the reformists’ attempts to push the government towards a more assertive
stance on social and political issues, Khamenei’s efforts to keep change un-
der control, and Rouhani’s attempt to carry on with his delicate diplomacy,
at home and abroad.
60. Masoud Lavasani, ‘Censorship issues raised at Tehran book fair’, Al-Moni-
tor, 19 May 2015 (http://www.al-monitor.com/pulse/originals/2015/05/iran-book-fair-
book-censorship-rouhani.html).
61. Arsalan Mohammed, ‘Iran and the art of Détente’.
62. Najmeh Bozorgmehr. ‘Iran’s reformists frustrated with slow pace of
change’, Financial Times, 16 January 2014.
518
Iran 2013-2015
5. The economic sphere: Rouhani’s battle for growth
Whereas some critics could accuse the president of not having paid
enough attention or spent enough energy on social matters, few would que-
stion the importance he attached from the beginning of his mandate to the
economic sphere. Economic rehabilitation ranked at the top of Rouhani’s
agenda, along with the nuclear issue. He installed an experienced group
of technocrats and economic planners to manage Iran’s recovery, most of
whom had been forced out of government by Ahmadinejad. The president
also openly condemned the choices and conduct in the economic manage-
ment of the country throughout the two Ahmadinejad’s mandates.
Rouhani’s commitment to the improvement of the economic outlook
resulted in some accomplishments. According to the World Bank’s annual
report, following two years of recession, the Iranian economy recovered du-
ring the 2014 Iranian calendar year (i.e., March 2014-March 2015). The
economy expanded by 3% in 2014, after annual contractions of 6.6% and
1.9% in 2012 and 2013, respectively. The inflation rate declined from a
peak of 45.1% in 2012 to 15.6% in June 2015 as a consequence of the tighte-
ning of the monetary policy by the Central Bank of Iran (CBI).63
Yet, in the words of the deputy director of the Foreign Policy program
at the Brookings Institution, the president «[had] promised the Iranian pe-
ople more than just a halt to the crisis; Rouhani [had] pledged to generate
growth, development, and jobs»,64 and in this regard the picture was far
from rosy. The unemployment rate remained high and rose slightly in 2014.
It reached 11.4% in 2014, up from 10.4% in 2013. The unemployment rate
remains much more elevated among women (20.3% for women against 8.7%
for men), among the population between the ages of 15 and 29 (17.9% for
men and 39% for women in this age cohort) and in urban areas (11.7% in
urban areas and 7.4% in rural areas). This weak labour market performance
took place within a context of a subdued and declining labour force partici-
pation rate with only 37.2% of the country’s population being economically
active in 2014, down from 37.6% in 2013 (62.9% for men and 11.8% for
women). The government estimated that 8.5 million jobs should be created
to reduce the unemployment rate to 7% by 2016.65
According to estimates upon the EU and US sanction relief which, ba-
sed on the phases of the JCPOA implementation described earlier, should
take place in the first quarter of 2016, real GDP should rise to 5.8 % and
63. Data provided by the World Bank website.

64. Suzanne Maloney, ‘Major beneficiaries of the Iran deal: The IRGC and
Hezbollah’, Testimony before the House of Representatives Committee on Foreign
Affairs, Subcommittee on the Middle East and North Africa, 17 September 2015
(http://www.brookings.edu/research/testimony/2015/09/17-beneficiaries-of-iran-deal-
malloney).
65. Data provided by the World Bank website.
519
6.7 % in 2016 and 2017, respectively, as oil production reaches 3.6 and
4.2 million barrels per day.66 The progressive removal of sanctions is ex-
pected to be accompanied by reforms of the business environment and the
financial and banking sectors. According to many observers, the positive
fulfilment of all these conditions could pave the way for a significant impro-
vement of Iran’s economic outlook, mostly as a consequence of the surge
in oil exports, the release of about US$100 billion in frozen assets, and
the prospect of re-engagement with the international markets. Iran has the
word’s second-largest gas reserves, third-largest oil reserves, and significant
rare earth deposits; it has a diversified economy, a trade surplus, and a
well-educated urban population The country’s 77 million consumers have
been locked out of global markets since 2010, when EU and US unilateral
sanctions were clamped on Iran, but the situation is expected to change
because of the agreement signed in July 2015.67
However, while the implementations of the deal is taking place, it be-
comes increasingly clear that Iran’s recovery from years of mismanagement
and isolation will not be as easy as initially envisioned. In 2015 the cost of
crude fell to levels not seen for 11 years and the decline may have further
to go, a phenomenon which Tehran blames on the Saudis and that strongly
links the future of oil prices - and of the Organisation of the Petroleum
Exporting Countries (OPEC) - with the rising tensions between Tehran and
Riyadh.68 Iranian authorities have been waiting for months to increase the
country’s oil exports after the drastic drop in sales produced by the embar-
go imposed in 2012 by the European Union. Iran’s oil exports had fallen
to 700,000 barrels per day (bpd) by May 2013, compared with an average
2.2 million bpd in 2011. Throughout 2015, Tehran exported 1.1m barrels
of oil per day, but in December 2015 the Iranian oil minister, Bijan Zanga-
neh, announced that the country was aiming to double that amount within
six months after sanctions being lifted.69 In an effort to attract foreign in-
vestment in the post-sanctions era, Iran also offered new oil and gas con-
tracts designed to benefit both international contractors and the National
Iranian Oil Company, particularly affected by the falling prices of oil.
Despite these efforts, the Iranian government was not able to at-
tract foreign investors. Already after the implementation of the interim
agreement, despite the interest shown by European companies, Iran was
experiencing severe difficulties in benefitting from the limited sanction
relief granted under the JPOA. The difficulties were mostly linked to the
66. Ibid.
67. Ben Winsor, ‘There’s Going To Be A Gold Rush If Sanctions On Iran Are
Lifted, But America Could Miss Out’, Business Insider, 2 October 2014 (http://www.
businessinsider.com/us-could-miss-out-on-irans-gold-rush-2014-10?IR=T).
68. ‘Recession, retrenchment, revolution? Impact of low crude prices on oil
powers’, The Guardian, 30 December 2015.
69. Ibid.
520
Iran 2013-2015
practical challenges of delivering money to a country largely isolated from

the global banking system and to the hesitation of financial institution
in authorising even legitimate trade and humanitarian transactions with
Tehran because of the nature of US sanctions.70 Iran also had difficulties
in improving its economy, exploiting the limited sanction relief, because
of the resistance raised by some sectors of its establishment, particularly
the IRGC, which remain hostile to a change in the image and structure of
power of the country,. They were determined to make sure that Rouhani
could not take the credit of the lifting of sanctions and the resulting eco-
nomic recovery. Additionally, these groups have been among those bene-
fitting the most from bribes and lucrative sanction-dodging schemes and
were understandably keen to maintain their privileges intact. To avoid
the increased presence of Western companies in Iran as a consequence of
the JCPOA reached in July 2015, hardliners thus conducted a witch-hunt
against «spies» to counter what IRGC commander, General Mohammad
Ali Jafari, defined a «prolonged sedition of infiltration».71 In this scena-
rio, based on the World Bank’s 2015 Ease of Doing Business Index, Iran
ranked 130th out of 189 countries - not prohibitively low, but far from
optimal. Moreover Iran was 111th out of 131 countries in a 2013 worldwide
ranking of property rights regimes, 136th out of 174 countries on Transpa-
rency International’s 2014 Corruption Perceptions Index, and 83rd out of
144 countries in the World Economic Forum’s 2014-15 Global Competi-
tiveness Index.72 Therefore, although lifting the international sanctions
against Iran might remove a substantial impediment to the improvement
of the country’s economic recovery, it will not automatically create the
legal and regulatory framework necessary for sustained investment. The
inability of the new leadership to attract investors, to effectively tackle
issues such as corruption, and to resist the attempts by the more conser-
vative elements within the élite to sabotage the new course, was crucial in
hampering Rouhani’s image domestically. The outcome of this struggle,
fought on the terrain of economy but with clear political implications, is
bound to have a crucial impact not only on the success of Rouhani’s project
of economic rehabilitation, but also on his own political standing. «People
are not economic experts. – dissident journalist and writer Akbar Ganji
commented in March 2015 – They expected the Rouhani administration
70. Aniseh Bassiri Tabrizi, ‘The EU’s sanctions regime against Iran in the after-
math of the JPA’, European Council on Foreign Relations, Vol. 105, June 2014, pp. 1-6.
71. ‘Iran Hardliners Trying to Kill Nuke Deal Arrest Western «Infiltrators»’,
The Daily Beast, 4 November 2015 (http://www.thedailybeast.com/articles/2015/11/04/
iran-hardliners-trying-to-kill-nuke-deal-arrest-western-infiltrators.html); Gerald F.
Seib, ‘Will Iran Hard-Liners Buy Economic Opening?’, The Wall Street Journal, 2 No-
vember 2015.
72. Cyrus Amir-Mokri & Hamid Biglari, ‘A Windfall for Iran? The End of Sanc-
tions and the Iranian Economy’, Foreign Policy, November-December 2015.
521
to improve the economy rapidly. But, since that has not happened, Rouha-
ni’s popularity has plummeted.»73 The situation partially improved after
the signing of the JCPOA in July: a poll conducted by iPOS [Iranian Elec-
tions Tracking Polls] in August 2015 suggested that a majority of Iranians
favoured the nuclear deal with the West. 77% approved the plan while
3% percent disapproved. The positive stance on the nuclear deal boosted
Rouhani’s overall popularity: in occasion of the same interviews 39% of
Iranians said they approved the way he was handling his job as president,
while 15% said they somewhat approved.
Yet such rise in popularity is unlike to last throughout the second half
of the president’s mandate unless the promise of a widespread relief from
economic hardship is fulfilled. As noted by Suzanne Maloney in September
2015 «to date, the nuclear diplomacy has provided no meaningful ‘trickle-
down’ effect for Iran’s economy or its population at large […] expectations
for Implementation Day are sky-high at home among Iranians, and Rouha-
ni will be risking his mandate and his presidency if he does not deliver on
real results.»74 Finally, the question of how to allocate the funds that will be
made available by the lifting of sanctions continues to loom at the horizon.
Whereas the official priorities remain job creation, a stimulus to the private
sector and sustainable growth, domestic dynamics and power struggles will
continue to affect the actual implementation of the initiatives designed by
the president and by his economic advisors.
Since the 1979 revolution, Iran has made several attempts to transit to
a market-based economy, most notably during the Rafsanjani administra-
tions between 1989 and 1997, and following the revision of Article 44 of
the Iranian Constitution in 2004.75 Iran’s efforts have largely failed due to
the political rationales of most of the economic measures adopted, and dif-
ficulties encountered when introducing measures aimed at increasing tran-
sparency and productivity and tackling corruption and inflation. As it has
been argued by Najmeh Bozorgmehr in the Financial Times, the initial call
for the establishment of an economy based on an amalgamation of Islamist
and socialist ideologies was soon abandoned to leave room for the creation
of «a class of oligarchs, nominally operating in the private sector, linked to
and dependent on the survival of the regime» in a society where «wealth that
is associated, as great fortunes usually are, with political patronage rather
73. Akbar Ganji, ‘Iran’s Hardliners Might Be Making a Comeback And the
West Should Pay Attention’, The Huffington Post, 13 March 2015.
74. Suzanne Maloney, ‘Major beneficiaries of the Iran deal’.
75. On the attempts to reform Iran’s economy and on the difficulties encoun-
tered, see: ‘Thermidor at Last: Hashemi-Rafsanjani’s Presidency and the Economy’,
in Saïd Amir Arjomand, After Khomeini: Iran Under His Successors, New York: Oxford
University Press, 2010, pp. 56-71; Evaleila Pesaran, Iran’s Struggle for Economic In-
dependence: Reform and Counter-Reform in the post-revolutionary era, London and New
York: Routledge, 2011.
522
Iran 2013-2015
than individual entrepreneurship.»76 There is no doubt that this time the

international as much as the domestic situation suggests a more favourable
outcome; yet the road towards an effective policy of economic reforms re-
mains long and rocky.
The first months of 2016 will prove crucial for the future of Iranian po-
litical and economic outlook. Should Iran meet its end of obligations under
the JCPOA, the beginning of the year might bring the lifting of nuclear-
related sanctions. The implementation of the agreement might dissipate
some of the doubts on the actual impact of the long-awaited removal of the
measures that have crippled Iran’s economy for decades. Sanctions relief
will be followed by the elections for the Majles and the Assembly of Ex-
perts scheduled for February. The candidates include Ali Akbar Rafsanjani,
who has been recently defeated in the elections for chairman of the Assem-
bly of Experts by ultraconservative Ayatollah Mohammad Yazdi, Ayatollah
Mohammad Taqi Mesbah-Yazdi, and Khomeini’s nephew, moderate senior
cleric Hassan. The climate of accusations and tensions that has so far domi-
nated the electoral campaign is a clear indicator of the importance of the
elections in shaping the domestic and foreign policy of the country for the
year to come.77
6. Conclusions
There are few doubts that the election of Hassan Rouhani as president
in June 2013 heralded a new phase in the history of the Islamic Republic of
Iran. Rouhani was elected on a platform of moderation, pragmatism, and
reintegration of Iran into the international community. He openly criticised
the conduct of the previous administration in a number of key fields, most
notably the nuclear policy and the economic management of the country,
and promised to improve Iran’s international standing and to bring relief to
the population after years of economic hardship.
Two-and-a-half years later his record shows mixed results. On the one
hand, Rouhani and his negotiating team headed by Foreign Minister Mo-
hammad Javad Zarif managed to achieve a deal with the P5+1, the JCPOA,
that pledges to bring an end to the twelve-year old dispute over the count-
ry’s nuclear programme. The agreement, when and if fully implemented,
will lift the economic sanctions imposed on Iran since 2006 by the UN,
the US, and the EU in exchange for the Tehran’s commitment to limit its
sensitive nuclear activities. The deal represents a crucial step in the norma-
lisation of Iran’s relations with the West and its reintegration into the inter-
76. Najmeh Bozorgmehr, ‘Corruption trial uncovers links between money and
Iranian politics’, Financial Times, 2 December 2015.
77. Arash Karami, ‘Rafsanjani’s son enters prison amid media circus’.
523
national community, as testified by Tehran’s inclusion in the Syrian peace

talks in October 2015. However, Iran’s rapprochement with the West and
regional cooperation over key issues, such as Yemen and Syria in particular,
continue to be limited, given the domestic infight between Tehran’s centres
of powers for the control of the different dossiers.
Furthermore, the success achieved on the diplomatic front of the nu-
clear issue was not matched by meaningful developments on the domestic
front. The beneficial impact of the agreement was not felt by the popula-
tion, which continued to struggle against unemployment and low growth
rates. The long-awaited and badly needed increase in foreign investments,
which was supposed to take place already after the interim agreement en-
tered into force in January 2014, was undermined, among other things, by
the persistence of corruption and the lack of transparency in the Iranian
economy. The limited economic growth compared to what anticipated by
the Rouhani administration was also the result of the collapse of oil prices,
but, once again, the conflicting interests of Iran’s factions played a major
role in hampering the country’s economic recovery in the past two years.
Limited progress also characterised the administration’s record on the
political and social sphere. At the end of the period under review, Mir Hos-
sein Mousavi and Mehdi Karroubi were still under house arrest, the situa-
tion of political prisoners remained unvaried, while executions have been
increasing since the advent to power of Rouhani. Despite a few symbolic
achievements, also the situation with regard to women’s rights and cultural
freedom remained critical. Whereas the number of registered NGOs in Iran
significantly increased, along with hopes of more freedom and influence
for civil society and interest groups, these hopes were mostly unfulfilled.
Censorship continued to be in place, the judiciary persisted in stopping re-
formist journalists from publishing new newspapers, and the pace of change
remained slow. «Having got the nuclear deal he desperately wanted, Hassan
Rouhani is now suffering the backlash» – wrote The Economist in November
2015. While the president was busy fending off the risks of a comeback from
the hardliners and trying to restart the economy, Khamenei, which backed
the president throughout the nuclear talks, seemed content to divide and
rule.78 «Mr Rouhani is stronger than before the deal,» – the article continues
– but «a stalled economy may hurt him as much as his conservative foes».79
The past two years were thus characterised by a mix of successes, ho-
pes and failed expectations for the Rouhani administration. All in all, the
presidency largely constituted the decision-making power within Iran com-
pared to the previous administration, particularly on a major international
and security issue, such as the nuclear dossier. Because of the structure and
the principles at the basis of the Islamic Republic, however, the Supreme
78. ‘Iran’s Crackdown: After the party’, The Economist, 14 November 2015.
79. Ibid.
524
Iran 2013-2015
Leadership has been careful in rebalancing the power of the Rouhani ad-
ministration, enabling different figures, close to the hardliners and to the
IRGC, to retain control over domestic issues and over other foreign policy
dossiers. 2016 will likely constitute the year in which factional politics will
reach its peak. With the looming parliamentary elections and the starting
campaign for the presidential elections which will take place in June 2017,
foreign policy, domestic reforms and economic prospects will likely all be a
mere representation of who will ultimately win the domestic infight. Whe-
ther regional tensions, notably with Saudi Arabia, or more importantly the
implementation of the nuclear agreement will play a crucial role in this,
remains to be seen.
525
reviews
the other side oF the chinese econoMic Miracle:

the dileMMas oF access to health care in the
people’s republic oF china
Barbara Onnis
Università di Cagliari
bonnis@unica.it
Daniele Brombal, Curarsi è difficile. Curarsi è costoso. Storia, politica e istitu-

zioni della sanità cinese, 1978-2013, Roma, Aracne, 2015, 167 pp. (ISBN
9788854883390).
Daniele Brombal’s book focuses on an extremely relevant issue – health

care in the People’s Republic of China (PRC). In some respects, health care
can be seen as a litmus test of the ability of the Chinese ruling class to manage
the numerous imbalances, determined by the economic miracle that resul-
ted from the reformist policy initiated by Deng Xiaoping in the late 1970s.
Beyond the astonishing growth rates and a widely recognized absolute pover-
ty reduction, the economic miracle has in fact given rise to serious imbalances
and social inequalities, as shown by the fact that the Gini coefficient has risen
from 0,16 (urban) and 0,21 (rural) at the beginning of the reform era (1978),
to 0,46 (national average) at the beginning of the new millennium, well above
the recognized warning level of 0,4. Not surprisingly, these increasing imba-
lances and inequalities have fuelled widespread social unrest over the years.
For the Chinese rulers, health care reform remains one of the many challen-
ges ahead, which needs to be urgently addressed, being compounded by the
challenges represented by both a rapidly aging population and increasing
levels of pollution. Three decades ago, only 5% of the population was over 65;
today, 123 million people, or 9% of the population, are over this age; and a
report released by a government think tank at the end of 2013 forecasts that
China will become the world’s most aged society in 2030. With regards to pol-
lution, it is one of the major causes of the increase in the number of diseases
within the Chinese population.

AsiA MAior 2015
In Curarsi è difficile. Curarsi è costoso. Storia, politica e istituzioni della sanità

cinese, 1978-2013 [«To Take care of one’s health is difficult. To take care of
one’s health is expensive»], Brombal provides a deep and meticulous analysis
of the political, economic and social changes that occurred in China since
the launching of the policy of reform and opening (gaige kaifang), in Decem-
ber 1978, during the Third Plenum of the 11th Central Committee Congress
of the Communist Party of China. The gaige kaifang included the growing
political and administrative decentralization, the de facto privatization of so-
cial services. This, in turn, brought about the establishment of strong eco-
nomic interests, triggered pervasive social and economic imbalances within
the population and, more recently, caused the regime’s attempt to promote
social equity in order to ensure its legitimacy and stability to the regime.
This complex process is analysed in Brombal’s monograph by using
the evolution of the health sector as a case study. In particular, the volume
describes the serious social imbalances existing in China today; the dysfunc-
tion of the health care system, the preponderance of the private interests to
the detriment of the health system consumers, the central government dis-
engagement in relation to the health sector during the 1980s and the 1990s
(strictly related to the belief of the substantial unproductiveness of all so-
cial sectors), the longstanding problem represented by the lack of enforce-
ment of central government’s regulations by local authorities when these
go against their interests and the general disinterest by the local authorities
towards the citizens’ well-being.
In 2000, all the above factors brought the World Health Organization
(WHO) to rank PRC’s health care system at the 144th place for its general
performance (behind Burundi) and at the 188th place in terms of equity (in
a general classification of 191 countries). This is in sharp contrast to the
fact that, only 18 years before (at the end of the Maoist era and on the eve
of the abolition of the Commune system), China had been considered an
outstanding example of primary health care (p. 81).
During the 2000s, the lack of coordination and the laxity of a part of
the administrative machinery in the field of health care became apparent,
even outside the PRC’s boundaries, with the burst of both the Severe Acute
Respiratory Syndrome (SARS) and Avian flu (or «bird flu») epidemics.
The author’s choice to concentrate the analysis on the rural areas is not
accidental; on the contrary, it has provided awareness that the rural areas
represent the «mouthpiece» of the contradictions that affect the Chinese
system today. Going beyond «the limits of the coastal cities and the big in-
dustrial centres» allows the author to observe the «raw matter/first matter by
which the so-called ‘Chinese miracle’ was fed» (p. 16).
In writing the book, Brombal has availed himself of a rich bibliogra-
phy – including scientific articles, laws and government regulations, policy
directives, propaganda and advertising campaigns – both in the Chinese
and Western languages. But the strong point of the book is represented
by the material collected by the author in the field, thanks to his sinolog-
528
Reviews
ical background and his language skills. Brombal has in fact carried out
quite-difficult fieldwork research, especially considering that this kind of
research is still viewed in China as a «sensitive activity» (p. 130). He has
conducted interviews and accepted spontaneous witnesses among med-
ical and administrative personnel, governmental officials, researchers,
students of the Faculty of Medicine and employees of the pharmaceutical
industry, in three Chinese provinces (Hubei, Shaanxi and Sichuan), in the
autonomous region of Inner Mongolia and in the municipalities of Bei-
jing and Shanghai. This impressive fieldwork has been part of a research
project (headed by the author himself) funded by the Italian Ministry of
Foreign Affairs (in particular the general direction of development co-
operation) and realized in cooperation with the PRC Ministry of Health,
between 2008 and 2011.
By making extensive use of the material collected in the field, Brom-
bal’s monograph shows that, starting from the mid-1980s, different eco-
nomic interest groups have acquired a remarkable capacity to influence the
definition and the implementation of health policies in order to maximize
their profits. This happened often with the connivance of the local author-
ities in charge of the health care management. In the last decade, these
trends have had a profound effect on the ability of the central government
to remedy the crisis in the health industry. This crisis was made more evi-
dent by the lack of access to health care by the most disadvantaged sections
of the population, the widespread impoverishment due to illness and, final-
ly, the outburst of the SARS crisis.
Brombal’s book is articulated in three chapters and a conclusion. The
first chapter describes the evolution of the Chinese health care system from
1949 until today, focusing on the role played by the Party/State in supplying
health care service in three different phases (1949-1983, 1983-2002 and
2002-2012), each one characterized by peculiarities that pertain to the dif-
ferent financial and distribution methods of health care services. The sec-
ond and the third chapters are structured as case studies of rural health in
China, aimed at demonstrating the working hypothesis, i.e., the fact that,
beginning with the mid-1980s, different economic interest groups – formed
largely by doctors, hospital managers and pharmaceutical companies – have
acquired a considerable capacity to hack into depth on the definition and
the implementation of health policies, in order to maximize their own prof-
its. In particular, the second chapter analyses the modes that have allowed
the proliferation of private interests in the health sector through the exploi-
tation of the loopholes, the weaknesses in the existing regulations and the
ability to promote the maximization of profits. The third chapter focuses
on the impact of private interests on the health policies adopted by the
administration, led by Hu Jintao and Wen Jiabao. In the conclusion, the au-
thor reflects on the failure of the health policy measures adopted by the Hu
Jintao-Wen Jiabao’s administration in order to put an end to the distortions
introduced by the neoliberal policies adopted during the 1980s and 1990s,
529
AsiA MAior 2015
both in terms of better access to health services and in terms of protection

of the rural population from the risk of illness-related impoverishment. As
a result, violent attacks against medical personnel by desperate people are
the order of the day (pp. 156-157).
Brombal’s monograph closes with an interesting photographic appen-
dix that witnesses the places and the people involved in the field research. A
second appendix contains the results of the targeted and spontaneous inter-
views (112 in total) conducted by the author between 2008 and 2011 among
medical and administrative personnel, governmental officials, researchers,
Faculty of Medicine students and employees of the pharmaceutical industry.
Finally, the volume includes numerous diagrams, graphics and tables that
contribute to make it easier to read.
Curarsi è difficile. Curarsi è costoso. Storia, politica e istituzioni della san-
ità cinese, 1978-2013 represents a fundamental reading on contemporary
China for both students and academics and for the general public, as well,
offering the keys for a better understanding of the problems bedevilling the
Chinese political leadership.
530
Reviews
the developMent oF the Most challenging

relationship oF our tiMes
Alessandro Uras
University of Cagliari
alessandro.uras@unica.it
Dong Wang, The United States and China: A History from the Eighteenth
Century to the Present, Lanham: Rowman & Littlefield, 2013, 377 pp.
(ISBN 978-0742557826)
The relationship between the United States and China is likely the
most studied and analyzed topic of the post-bipolar world. The growing
interest towards the Sino-American issue arose since the rapprochement
of the two governments and the historical visit of Richard Nixon in 1972.
During the last fifty years, both Western and Chinese scholars have written
extensively on Chinese history and foreign relations, American history and
the narrow overlapping slice of US-China Relations. Dong Wang’s book is
very ambitious, because it almost covers the entire time span of the bilateral
relationship but also very clearly combines history and international rela-
tions to give a powerful account of how the two countries first encountered
each other and why their interaction matters so much in the present day.
It could be said that the present years are a very peculiar time to revisit the
history of relations between the United States and China. That could be said
because Washington has arguably reached the apex of its power and is likely
to decline, whereas China’s wealth and strategic power are on the rise, and
the two states and systems seem destined to compete for regional and global
leadership in the years ahead.
The author’s approach stems from a long historical perspective, in
which the relationship between the United States and China is seen as pas-
sing through three phases, whose watersheds are roughly the mid-ninete-
enth and mid-twentieth centuries. Relations shifted significantly, from the
interaction between an old empire (under the Qing Dynasty) and a young
nation-state to the interplay between two-nation states, and then to wide-
ranging encounters between a nation-state (the People’s Republic of China)
and a modern empire (the post-war United States).
Consequently the book is divided into three main sections, which are
set in chronological order and cover a large spectrum of topics: from the di-
plomatic and political realm to the social, religious and cultural fields. The
first part focuses on the early stages of the relation, from 1784 to 1911, and
describes the inception of the economic and political mechanisms between
the two countries. The early economic relations between the United States
531
AsiA MAior 2015
and China reflected the pre-industrial nature of the American economy,

which was yet to produce major manufactures to export. The American de-
but on the Chinese stage constituted the triumphant entry of a new nation
into an expanding international system of politics and trade, controlled by
the then hegemonic British Empire and other major European powers. The
outbreak of the Opium Wars (1839-42 and 1856-60) and the consequent
unequal treaties forced on China by the Western powers almost blocked the
development of the bilateral trade between the US and China. Washington
maintained a neutral stance and didn’t advance any requests until 1899,
when the United States proposed the so-called Open Door policy, espou-
sing equal commercial opportunity and respect for China’s administrative
and territorial integrity. This policy could be seen as a major countermove
against the European territorial scramble and a sign of independent di-
plomacy. America’s rising presence in East Asia fell within the ambit of its
consistent pursuit of national greatness. This presence was reinforced by
the constant work of the Christian missions, which suffered the widespread
anti-Christian xenophobic violence but were also able to conquer the ap-
preciation and achieve accommodation and collaboration with a consistent
part of the population.
The second part examines the different paths followed by the Uni-
ted States and China in the era of the World Wars and revolutions, from
1912 to 1970. The Celestial Empire and the Qing dynasty were overthrown
in 1911, marking a major shift in the East Asian environment. In this in-
tricate scenario, the two countries were brought closer, both as a result of
their divergent stages of national development and as a consequence of the
adoption of particular geopolitical strategies. The author outlines the evo-
lution of this pattern and explains how World War I stimulated the relations
between China and the United States. Respect for Beijing’s neutrality and
the preservation of the status quo in China were «most important in Ame-
rican interests» (pp. 128). The disappointment and the rejection of China’s
«seven aspirations» at the Paris Peace Conference (1919) fuelled political re-
sentment in China. The ascendency of Japanese imperialism and the rise of
the Chinese Communist Party (CCP) shaped the Sino-American relation in
1930 to 1940. The Pacific War and the inability to provide a strong support
to Chiang Kai-shek and his Kuomintang against the Japanese forces caused
what is known in American historiography as «the loss of China». In 1949,
the CCP defeated Chiang and declared the birth of the People’s Republic
of China. President Truman described it as an «avoidable catastrophe» and
Dong is particularly adept at describing and connecting the causes and the
events that led to the final denouement. The United States and China share
responsibility for the unsettled post-World War II order in the Asia-Pacific.
Washington wanted to handle Southeast Asia by «liquidating colonial re-
gimes and replacing them by new and stable independent governments»
(pp. 207). The Korean War and the Vietnam War were the major sources of
acrimony in the early Cold War period. However, by the end of the 1960s,
532
Reviews
both countries realized that they needed to work together and were ready to
enter a new phase of their relationship.
The third and last section covers the period from 1970 until the pre-
sent day, describing the rapprochement and the renewing of the bilateral
relationship. The normalization of Sino-American relation was a gradual
process, taking three American administrations and two generations of
Chinese leaders to bring it to completion. The core of President Nixon’s
strategy was to pull China back into the world community, but as a great
and progressing nation and not as the epicenter of world revolution. The
US offered China some tangible stakes in a future relationship, as Beijing’s
entrance into the United Nations Security Council in place of Taiwan. The
secret meetings between Henry Kissinger and Zhou Enlai prepared the
ground for Nixon’s visit in February 1972. Despite this political breakthrou-
gh, official diplomatic relations did not become reality until 1979. The late
1970s and 1980s witnessed China’s historic domestic reforms under the lea-
dership of Deng Xiaoping, but the impressive economic growth was almost
put in jeopardy by the Tiananmen Crisis in 1989. As a result, Sino-American
relations were severely strained over the issue of human rights, and the Tia-
nanmen incident has had major repercussions, particularly in the fields of
policy making and mutual perceptions, right up to the present. A spirit of
wariness and anxiety on both sides characterized the geopolitical relation-
ship between the two governments in the first decade of the 21st century.
This paradigm changed after 9/11, when the US perception of China shif-
ted from a potential military competitor to an important strategic partner
in the war against terror (pp. 290). Despite the increasingly comprehensive
links, in recent years, both countries have grown wary on each other, and the
American-inspired rhetoric of the «China Threat» keeps emerging, adver-
sely affecting the political environment. China’s desire to reassert itself in
the Asia-Pacific region, after its «century of shame» at the hands of Western
powers, has broader implications, particularly for the United States, which
appears to have the most to lose if China’s emergence comes at their expen-
se. Dong, however, states that although the two countries have quarreled,
often bitterly, most of the time they have managed their uneasy relationship
in a rational manner (pp. 297). Accordingly, she is confident that the ties
between the two countries will strengthen rather than deteriorate, among
other reasons, because strategic rivalry and military confrontation, in to-
day’s entangled world, are not only too expansive but also bring no benefits
to the countries involved.
The author closes her book by assuming that the US-China bilateral
relationship is a major security concern for each side, but both countries
need to work together on friendly terms to secure a better future, both for
themselves and for the entire international community.
The monograph under review is an outstanding book that offers the
first comprehensive synthesis of the history of US-Chinese relations from
the initial contact to the present. Dong’s aim is not to generate new findings
533
AsiA MAior 2015
on specific aspects of the Sino-American relationship but to produce a very

detailed epitome of the most important international relationship of our
time. She has also reached her objective by grounding her analysis on a con-
gruous number of Chinese sources in order to give a better understanding
of Chinese views and behaviour.
Not only is the book addressed to students who need an introduction
to the topic and academics, but it is also an extremely useful read for any
educated person who might decide to approach the issue, such as journalists
and media commentators.
534
appendix
list oF the asia Maior’s issues
Followed by the recommended shortened style of quotation
Vol. I) Giorgio Borsa e Paolo Beonio-Brocchieri (a cura di), Asia Major.

Un mondo che cambia, Ispi/il Mulino, Bologna 1990 (Asia Major 1990);
Vol. II) Giorgio Borsa e Paolo Beonio-Brocchieri (a cura di), L’Altra Asia
ai margini della bufera. Asia Major 1991, Ispi/il Mulino, Bologna 1991 (Asia
Maior 1991);
Vol. III) Giorgio Borsa (a cura di), Le ultime trincee del comunismo nel
mondo. Asia Major 1992, Ispi/il Mulino, Bologna 1992 (Asia Major 1992);
Vol. IV) Giorgio Borsa (a cura di), La fine dell’era coloniale in Asia Orien-
tale. Asia Major 1993, Ispi/il Mulino, Bologna 1993 (Asia Major 1993);
Vol. V) Giorgio Borsa e Enrica Collotti Pischel (a cura di), Luci e ombre
sullo sviluppo in Asia Orientale. Asia Major 1994, CSPEE/il Mulino, Bologna
1994 (Asia Major 1994);
Vol. VI) Giorgio Borsa e Giovanna Mastrocchio (a cura di), Tra Demo-
crazia e neoautoritarismo. Asia Major 1995, CSPEE/il Mulino, Bologna 1995
(Asia Major 1995);
Vol. VII) Giorgio Borsa e Giovanna Mastrocchio (a cura di), Integrazione

regionale e ascesa internazionale. Asia Major 1996, CSPEE/il Mulino, Bologna
1996 (Asia Major 1996);
Vol. VIII) Giorgio Borsa (a cura di), Continua il miracolo asiatico? Asia
Major 1997, CSPEE/il Mulino, Bologna 1997 (Asia Major 1997);
Vol. IX) Giorgio Borsa (a cura di), L’Asia tra recessione economica e minac-
cia nucleare. Asia Major 1998, CSPEE/il Mulino, Bologna 1998 (Asia Major
1998);
Vol. X) Giorgio Borsa e Michelguglielmo Torri (a cura di), L’incerta vigi-

lia del nuovo secolo in Asia. Asia Major 1999, CSPEE/il Mulino, Bologna 1999
(Asia Major 1999);

AsiA MAior 2015
Vol. XI) Giorgio Borsa, Corrado Molteni e Francesco Montessoro (a

cura di), Crescita economica e tensioni politiche in Asia all’alba del nuovo millennio.
Asia Major 2000, CSPEE/il Mulino, Bologna 2000 (Asia Major 2000);
Vol. XII) Giorgio Borsa, Corrado Molteni e Francesco Montessoro (a

cura di), Trasformazioni politico-istituzionali nell’Asia nell’era di Bush. Asia Major
2001, CSPEE/il Mulino, Bologna 2001 (Asia Major 2001);
Vol. XIII) Elisa Giunchi, Corrado Molteni e Michelguglielmo Torri (a

cura di), L’Asia prima e dopo l’11 settembre. Asia Major 2002, CSPEE/il Mulino,
Bologna 2003 (Asia Major 2002);
Vol. XIV) Corrado Molteni, Francesco Montessoro e Michelguglielmo

Torri (a cura di), Le risposte dell’Asia alla sfida americana. Asia Major 2003,
CSPEE/Bruno Mondadori, Milano 2004 (Asia Major 2003);
Vol. XV) Corrado Molteni, Francesco Montessoro e Michelguglielmo

Torri (a cura di), Multilateralismo e democrazia in Asia. Asia Major 2004, Bruno
Mondadori, Milano 2005 (Asia Major 2004);
Vols. XVI & XVII) Michelguglielmo Torri (a cura di), L’Asia negli anni
del drago e dell’elefante 2005-2006. L’ascesa di Cina e India, le tensioni nel con-
tinente e il mutamento degli equilibri globali, Guerini e Associati, Milano 2007
(Asia Maior 2005-2006);
Vol. XVIII) Michelguglielmo Torri (a cura di), L’Asia nel «grande gioco».
Il consolidamento dei protagonisti asiatici nello scacchiere globale, Guerini e Asso-
ciati, Milano 2008 (Asia Maior 2007);
Vol. XIX) Michelguglielmo Torri e Nicola Mocci (a cura di), Crisi locali,
crisi globali e nuovi equilibri in Asia, Guerini e Associati, Milano 2009 (Asia
Maior 2008);
Vol. XX) Michelguglielmo Torri e Nicola Mocci (a cura di), L’Asia di

Obama e della crisi economica globale, Guerini e Associati, Milano 2010 (Asia
Maior 2009);
Vol. XXI) Michelguglielmo Torri e Nicola Mocci (a cura di), Ripresa

economica, conflitti sociali e tensioni geopolitiche in Asia, Emil di Odoya, Bologna
2011 (Asia Maior 2010);
Vol. XXII) Michelguglielmo Torri e Nicola Mocci (a cura di), L’Asia nel
triangolo delle crisi giapponese, araba ed europea, Emil di Odoya, Bologna 2012
(Asia Maior 2011);
536
Appendix
Vol. XXIII) Michelguglielmo Torri e Nicola Mocci (a cura di), Rallenta-

mento economico e debolezza della politica in Asia, Emil di Odoya, Bologna 2013
(Asia Maior 2012);
Vol. XXIV) Michelguglielmo Torri e Nicola Mocci (a cura di), Il dragoci-

nese e l’aquila americana sullo scacchiere asiatico, Emil di Odoya, Bologna 2014
(Asia Maior 2013);
Vol. XXV) Michelguglielmo Torri e Nicola Mocci (eds.), Engaging Chi-

na, Containing China, Emil di Odoya, Bologna 2015 (Asia Maior 2014).
537
ACKNOWLEDGEMENTS
The Asia Maior think tank owes a debt of gratitude both to the Centro
Studi Vietnamiti of Turin, which hosts the think tank official site, and, in
particular, to its Director, Mrs. Sandra Scagliotti, for her continuous and
generous support. This debt is here gratefully acknowledged.
Printed in Rome, Italy
by Grafica Editrice Romana S.r.l.
July 2016

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Asia Maior.

The Journal of the Italian Think Tank on Asia founded

Annual journal - Vol. XXVI, 2015

This journal of the Associazione Asia Maior is published jointly by

Editor (direttore responsabile): Michelguglielmo Torri, mg.torri@gmail.com

Graphic design: Nicola Mocci

Paper version Italy € 50.00 Abroad € 65.00

Subscription abbonamenti@viella.it www.viella.it

The Chinese-American Race

Steering Committe: Marzia Casolari (President), Enrica

Scientific Board: Guido Abbattista (Università di Trieste), Domenico Ami-

CSPE - Centro Studi per i Popoli extra-europei

7 nicola Mocci & MichelguglielMo torri, Foreword: Asia Maior in

Asia Maior, XXVI / 2015 5

Asia Maior, XXVI / 2015 7

Germany). This agreement established the possibility of a more dynamic role

2. For a discussion of these problems see Francesca Congiu, ‘Cina: lavoro al

World War, on three pillars: military supremacy, economic supremacy and

3. On the concept of cultural hegemony, which we prefer to the more recent

containment. The third stage was heralded by Richard Nixon’s speech in

Looking at things from this perspective, it is worth noting that out of

brought about a limitation of the extensive powers given to the presidency

in Iran, to what appears, to a large extent, to be the ideal type of an autho-

12. Emanuela Dalmasso, On fait du lobbying. Transizione democratica e movimento

1. Towards a re-construction of a new «New International Economic Order»?

Asia Maior, XXVI / 2015 19

national Economic Order. According to the programme, the New International

7. National Development and Reform Commission (Ministry of Foreign Affairs

In that sense, China in 2015 was recalling the NIEO experience in

Xi Jinping exposed the Silk Road Economic Belt at Nazarbayev Uni-

existing multilateral-cooperation mechanisms, such as the Shanghai coop-

Also, according to Xinhua, during the first seven months of 2015,

4. The «Go Global» strategy, the «New Normal» theory,

At the end of 2015, China’s GDP growth stabilized itself at around

39. ‘Xi’s New Normal Theory’, Xinhuanet, 9 November 2014.

In line with the party’s approach, Hu Angang, professor of economics

43. Hu Angang, ‘Embracing China’s «New Normal»’, Foreign Affairs, May-June

The infrastructure projects proposed as part of the OBOR initiative

21st-Century Maritime Silk Road’; ‘The Complex Impact of Urbanization in Xinji-

5. The OBOR initiative «in action»: Beijing’s infrastructure diplomacy

53. Du Ming, ‘When China’s National Champions Go Global: nothing to fear

overseas infrastructure development projects […] We will work to increase

5.1. Building the Eurasian corridor

China’s «going out – going west» investment policies, as part of the

forum, the two countries signed 20 cooperation agreements accounting for

Among the ASEAN countries, Vietnam, one of the main players in

state-owned enterprise, was developing the port of Piraeus in Greece into

economy but also of Southeast Asian countries’ trade interests.85 According

6. Financing the OBOR: China-led multilateral financial institutions

impasse-at-the-imf); ‘US Congress Ratifies IMF Quota Reforms’, Xinhuanet, 19 De-

6.1. The West divided over the AIIB/China question

103. ‘Europeans Defy US to Join China-led Development Bank’, Financial

from the Obama administration.106 Moreover, as previously mentioned, the

7. «Seeking new models of international cooperation and global governance»

cific Partnership Agreement and the Transatlantic Trade and Investment

118. Ibid. (§. 9).

Barbara Onnis and Marco Milani

University of Cagliari Università di Bologna

In 2015, in South Korea, President Park Geun-hye’s decline in popularity, which

Asia Maior, XXVI / 2015 53

2.1. South Korean domestic politics:

2.1.1. The Government reshuffle

economy, - especially the reform of the labour market, considered of para-