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Strategic Analysis:
A Monthly Journal of the IDSA
Maritime Power of People's Republic of China: The Economic Dimension
By Vijay Sakhuja
*
Abstract
For decades, the Chinese leadership had remained content with being a continental power. The national interests and national defence were limited both in their outlook and reach. During the last decade or so the Chinese ambitions and visions have grown beyond the borders and shores. Impressive economic growth, a large merchant marine, growing ship-building industry and maritime trade all point to the fact that China has emerged as an important maritime power in the international system. The maritime infrastructure is being developed to support economic growth and the maritime industry has shown impressive expansion. The growing need to protect and promote maritime economics and territories has forced national planners to accord a high priority to develop a modern navy.
In 1949 the communists came to power in China and began to salvage their ancient maritime glory. Although much of the maritime infrastructure had been destroyed by the retreating nationalist forces, China began to rebuild with the Soviet Union's assistance. There was a maritime ambition but this was limited in outlook due to a strong domination by the Red Army leaders. Over the last fifty years, the Chinese maritime strategic thinking has undergone a sea change and there is a new awareness of the importance of maritime power among the national leaders. This 'maritimeness' 1 has developed into a sophisticated strategy aimed at turning China into a world class power. The four modernisations resulted in coastal zone development programmes and contributed to national growth. The Chinese academics conducted studies on 'control of the sea'. 2 The Chinese believe that to build China into a real maritime power, they must intensify marine resource studies and develop maritime infrastructure and are convinced that the Twenty First century would be the maritime century.
Towards that end, the Chinese government has stressed the need to develop and utilise marine resources, both living and non-living. It has listed the development of marine industries as one of the top priorities for the Ninth Five Year Plan (1996-2000) and invested more than 40 million US dollars. 3 The maritime economy has been growing by leaps and bounds and correspondingly the maritime infrastructure, both economic and military, is being developed. Although in the past the marine industry had been playing a dominant role, the new thrust is a combination of traditional and the newly rising marine industry. The current maritime economic indicators point to the fact that China is actively engaged in an aggressive maritime policy to achieve a maritime power status.
This paper aims at examining the economic dimension of Chinese maritime power. It highlights the impressive growth of Chinese shipyards, sea ports, merchant shipping, sea borne trade, fishing and the marine tourism industry during the last decade. It also discusses the impact of these developments on the regional security environment. The reverberations of these developments have also been felt in the Indian Ocean. As the Chinese maritime power grows, it would impact on the Indian security environment too.
Maritime Economic Geography
According to official statistics, China has a land area of 9.6 million square kilometers, making it the third largest country in the world. It has a long coastline of 18,000 km and 5000 islands/islets in territorial waters with an area of more than 14,000 square km. The Chinese coast is bound by the Yellow Sea, East China Sea and the South China Sea. Being a signatory to United Nations Convention Of The Law Of The Sea (UNCLOS) exercises sovereignty and jurisdiction of the Exclusive Economic Zone (EEZ) that stretches out from the coast to 200 nautical miles into the sea. It claims an Exclusive Economic Zone of 3.2 million square km. It is also endowed with 110,000 km of inland waterways that are an important medium for inland transport and related maritime infrastructure.
The sea is offering China a new thrust area for its overall national strength in terms of economic and military growth. The maritime dimension plays an important role in developing an export oriented economy. About 40 per cent of China's total population lives in the coastal areas but occupies only 13 per cent of the total land area. 4 The average population density is 383 people per square kilometer (1995). There are 15 major coastal cities with a population exceeding 100,000 people. More importantly, this small area contributes about 60 per cent to the GDP. 5
In the last decade, the coastal areas have experienced most of the economic boom of China and the local governments have supported this effort. At least 11 coastal provinces and autonomous regions have developed a sophisticated strategy for maritime resource development and management. 6 Their agenda is as follows:
(a)Guangxi Province: The Blue Plan.
(b)Guandong Province: Development of marine mineral resources.
(c)Fujian Province: Development of tidal floats, shallow sea fields and gardens at sea.
(d)Zhejiang Province: Develop harbours at Ningbo, Wenzhou and Zhoushan.
(e)Shangai Province: Export oriented economy; combine Pudong development and marine development.
(f)Jiangsu Province: Marching towards ocean and developing eastern Jiangsu.
(g)Shadong Province: Shadong at sea.
(h)Hebei Province: Vitalise the marine industry and develop coastal areas.
(i)Tianjin Province: Comprehensive marine development.
(j)Liaoning Province: Liaoning at sea.
(K)Jilin Province: Comprehensive R&D of Tuminjiang region.
Ocean Agenda 21 and Development of Marine Programme
In 1996, China formulated a sustainable development strategy for marine programme titled 'Ocean Agenda 21'. 7 The basic ingredients were: to effectively safeguard the national maritime rights and interests, rationally develop and utilise marine resources, earnestly protect the marine environment and realise the sustainable utilisation of marine resources. In 1998, China published a white paper on its maritime economy titled 'Development of China's Program'. 8 This was the first of its kind since its founding in 1949. As a developing country, China has taken maritime development and marine protection as its long-term development strategy. The Chinese leadership believe that the conditions for such a development are favourable both geographically and economically.
According to the white paper, during the last two decades, the Chinese maritime economy has provided some promising statistics and has developed at an impressive pace. For instance in the 1980s, the maritime economy grew at seventeen per cent annually. Since the 1990s the average growth rate has stood at twenty per cent. In 1996, the GDP of coastal cities, mainly relying on maritime economy, accounted for 48 per cent of the total in coastal areas. In 1997 the total output value of marine industries was 6.4 million Yuan. In 1997 it rose sharply to 300 million Yuan, accounting for 4 per cent of the GDP. This was 7.6 per cent up from the previous year. The coastal provinces have thus contributed substantially to the overall national GDP. The maritime component of the economy of coastal cities and countries experienced a high growth rate amounting to 2244.3 billion Yuan which corresponds to 52.4 per cent of the coastal GDP.
The white paper notes that China's maritime economy involves more than twenty sectors, including maritime transportation, fishing, salt industry, offshore marine resources both living and non-living (fish, hydrocarbons, etc) and marine tourism. In 1997, the total output of the ocean fishing industry amounted to 13.85 million tons thereby helping China retain the top position in the world. Progress has also been made in offshore hydrocarbon exploration and development. By 1997, more than hundred oil-gas-bearing sites had been discovered and 1.7 billion tons of oil reserves and 350 billion cubic meters of natural gas had been confirmed. China's offshore oil production exceeded 16 million tons and natural gas industry output was pegged at 4 billion cubic meters.
Similar trends were also visible in the transportation sector. Important developments have taken place in marine transportation. According to the white paper, by 1997, Chinese merchant shipping was close to 50 million dwt, comprising 320,000 vessels of different sizes. The shipbuilding industry registered rapid development and in 1997 China's shipbuilding industry ranked third in the world behind the Republic of Korea and Japan. Ports and harbours also witnessed similar changes. China has fifteen major ports with an annual handling capacity of more than 10 million tons. In 1997, the volume of freight handled by the major ports totaled more than 900 million tons. China's marine tourism is now an attractive and economically beneficial industry. The coastal provinces have created more than 300 marine and island tourism recreational centres. In 1997, more than 10 million overseas tourists visited these sites.
In addition high-tech marine industries have been developed. These involve utilisation of seawater, sea energy and exploitation of seabed resources. China's 12 coastal provinces have played an important role towards development of maritime power. There were more than 4 million people engaged in maritime related industries primarily in coastal areas.
Shipbuilding Industry
China's shipbuilding industry entered the international market in the 1980s. Since then it has been expanding at a rapid pace and ranks third in the world. During the 1990s, its output grew from 1.2 million tons grt in 1992 to 4.48 million tons grt in 1999. In 1999 the orders totaled $1.8 billion. 9 China has the capacity and capability to build various kinds of vessels both for domestic and international buyers and the shipyards are gradually becoming popular among foreigners. They are able to challenge the competition posed by Japanese and Korean yards which account for about 65 to 70 per cent of the world market.
The Chinese shipyards order book accounted for 7.5 million grt in September 1999 compared to 5.1 per cent in 1998. 10 China has, for the last six years, consistently maintained third position in the world shipbuilding market though it is considerably behind Japan and Korea. The shipyards have thus benefited from the growing order book. They are confident of touching the ten per cent mark in the coming years. China has attracted some important contracts including a VLCC for National Iranian Tanker Company 5,500 TEU containership and a high speed Ro Pax vessel for Swedish owners. 11
Since the beginning of reforms, great changes have taken place in the shipbuilding sector. The industry has been restructured to meet the growing demand for cheap ships. In 1986, China had 523 shipyards, 160 specialised factories, 5,40,000 employees and 80 research industries. 12 These have grown over the years to over 1,250 shipbuilding and ship repairing enterprises including 285 state owned enterprises, 857 collective businesses and 78 foreign ventures. 13
One of the important factors responsible for this sudden upsurge in interest in the Chinese shipbuilding industry is the relative cost of shipbuilding. For instance, the cost of production of a VLCC in the more competitive Japanese shipyards is about $90 million while in China it is pegged at about $60 to 70 million. 14 Based on one dollar/hour/labour, the cost of construction is much less as compared to Japan and Korea. This has resulted in a large number of orders. Besides the shipbuilding companies have not resorted to price dumping and have maintained a firm sale policy.
The Chinese government has been closely following the market trends in world shipbuilding. With a 90 per cent export oriented industry, it has been restructuring the industry. The China State Shipbuilding Corporation (CSSC) which controls key shipyards has been divided into two entities. The CSSC will be responsible for shipyards in northern China while the China Shipbuilding Industry Corporation (CSIC) will manage shipyards in the southern part of the country. The CSSC plans to increase its annual output to 2.5 million tons grt in 2005 to become one of the top five shipbuilding groups. Similar trends are available for the CSIC. 15 The liberalisation of the economy has had a dramatic effect on the management and financing of foreign orders. Chinese shipyards are turning into efficient enterprises capable of building vessels to owner specifications. New technologies have been inducted and management techniques are being sharpened to build ships on time.
Shipping Industry
Chinese merchant shipping has made considerable progress during the last decade. It plays an important role in international trade and is a symbol of the growing maritime power of China. There are over four hundred domestic and international shipping companies engaged in maritime trade making China an A class member state of the United Nations Maritime Organisation. 16 China has held this position for the last five consecutive years. Besides, China has also been appointed to the Steering Committee of the International Maritime Organisation. Today, more than ninety per cent of the Chinese foreign trade is carried by ships; the shipping industry has turned itself into an engine for an impressive economic progress.
The Chinese government policies towards the shipping industry are growth oriented. 17 These include:
(a)Foreign shipping companies are allowed to undertake shipping between Chinese and foreign ports.
(b)Foreign shipping companies are allowed to undertake regular international shipment between China's open ports and foreign ports.
(c)Foreign ships are allowed to use same charge rates as Chinese ships in Chinese ports.
(d)Foreign companies are allowed to set up Sino-foreign joint water-shipping enterprises in China according to set procedures and conditions.
(e)Foreign shipping companies are allowed to set up solely-owned shipping companies to take on work, draw on bills of landing, collect freight charges and conclude service contracts according to ocean-going agreement signed by governments.
According to the data compiled by the German Institute of Shipping Economics and Logistics (GSL), in 1996 the Chinese shipping fleet comprised 22.5 million tons deadweight tonnage (this includes ships of over 1000 ton dwt). Besides, there was an estimated 11.7 million tons dwt fleet tonnage on Chinese owned shipping flying flags of convenience. 18 The Chinese flagged shipping fleet has a variety of vessels. These include bulk carriers, tankers, LNG and chemical carriers, container vessels, Ro/Ro ships and passenger liners. The national container and tanker fleet ranks seventh and tenth in the world. 19 Container vessels have come to play an important role in the Chinese shipping industry. Besides being the top producer of shipping containers, the Chinese container fleet is making great progress and has a total capacity of 260,000 TEUSs. 20 Since 1990 the volume of containers handled by Chinese ports has surged forward increasing four fold between 1990 and 1995. It is estimated that by the end of 2000, Chinese ports would handle more than ten per cent of the Asian total. 21 While the future outlook for container vessels is very bright, the Chinese tanker fleet has been under great pressure. As China's economy grows, its need for energy will grow correspondingly. In 1993, China became a net importer of oil but the tanker fleet has not been able to cope up with this increase in import capacity.
As a result of opening up of the economy and major maritime economic reforms, the Chinese shipping industry has expanded rapidly. Since 1984, when the first foreign ship docked in a Chinese port, there has been a major surge in foreign investments in this sector. At the end of 1995, China had 290 domestic shipping companies engaged in international trade and by 1996 fifteen foreign companies had joined the competiton. 22 By 1999, there were more than 120 Sino-foreign joint venture shipping companies in China. There are 350 representative offices of foreign shipping companies and 467 foreign funded shipping agents. These trends have generated a healthy competition in the shipping market and provided a boost to the sector. China has also concluded ocean and river shipping agreements with 52 countries of the world.
As the Chinese national shipping sector makes great strides, the Chinese ship owners are inducting newer ships. The average age of Chinese owned shipping is 17.6 years, above the world average of 16.2 years. The mixed cargo vessels are even older at 19.9 years. 23 This has resulted in greater scrutiny from Western countries' port authorities on account of safety, pollution and accidents. Besides these countries have become apprehensive about transporting their cargo on Chinese vessels.
China Ocean Shipping Corporation (COSCO) and China Shipping Corporation (CSCO) are the top two shipping companies in China. In 1999, COSCO shipping volume touched 76 million tons and it transported 1.9 million TEU containers. The performance of CSCO was equally impressive and it carried 85 million tons of cargo and 0.7 million TEUs. 24
Sea Ports
Sea ports are an important component of a country's maritime power. This is true for China also. As one of the world's largest growing economies, the Chinese government attaches great importance to development of ports and is engaged in upgrading the existing infrastructure encompassing berth development, cargo handling equipment and removing bottlenecks.
China has over 300 hub ports of which about 200 are sea ports straddled along the long coastline. Only 128 of these are open to foreign vessels. 25 There are 45 ports with 496 deepwater berths capable of berthing vessels over 10,000 dwt. As many as 38,000 foreign flag vessels enter and leave Chinese ports each year. In 1999, China's main ports handled 1.3 billion tons of cargo, 13 per cent more than the previous year. Similarly, the top ten river ports handled a total of 175 million tons, an increase of 11 per cent over the last year. As per the State Port Administrative Officer (SPAO), 80 per cent of total shipping for China is handled in 30 ports. 26
The development of maritime transportation infrastructure is time consuming, expensive and difficult. The China hinterland transportation network, both rail and road, is underdeveloped and this places greater pressure on maritime transport-both sea and rivers. China has rapidly improved its port facilities by focussing on meeting the demands of international trade as also domestic transportation of critical items like coal and oil. Since the 1980s, the decentralisation process has encouraged local governments to adopt a new philosophy of self-reliance. It aims at following the dictum "using road to sustain road, using port to sustain port, using bridge to sustain bridge", meaning that they would raise funds locally to sustain growth and development. 27 However, for large scale projects, several financial agencies like the World Bank, Asian Development Bank, Japanese Overseas Corporation Fund are being tapped. Besides, bilateral aid from developed countries is being obtained. 28 Another vehicle for fund raising are the domestic and overseas infrastructure bonds. There is also the overseas Chinese money that offers another source for funding.
The Eighth (1991-1995) and the Ninth (1995-2000) Five Year Plans, have aimed to remove bottle-necks in maritime transport infrastructure. Greater attention has been given to transportation of grain and coal. To meet the ever increasing demand for berths for foreign trade, 180 new berths (100 of which are deep water) have been built. These meet the requirement of bulk cargo, containers and Roll On/Roll Of (Ro/Ro) operations. Particular attention is being paid to install mechanised loading/unloading systems and containerisation. China's international container shipping has grown speedily. Its port throughput has risen from 2.2 million TEUS in 1991 to 8.1 million TEUs in 1996. 29 Shanghai and Shenzhen handled a recorded 4.2 and 3.0 million TEUs in 1999. Container and inter modal transport are growing faster than shipping as a whole.
Fishing Industry
At the turn of the century, China's population was 1.3 billion, accounting for twenty two per cent of the world total. The current demand for food grains has touched 500 million tons and will continue to grow with time. By 2030, it is expected that China's population will reach 1.6 billion and correspondingly the demand for grain would have touched 640 million tons. 30 Besides, crop lands have begun to shrink and the water table has gone down. It would not be long before China begins to import food. Lester R. Brown, President World Watch Institute, in his book titled "Who will feed China: A wake up call for small planet", warned that rise in Chinese food demand would result in grain shortages and rise in food prices.
But the Chinese government has dismissed these concerns and is confident that it can meet the growing demand and feed its people. According to the White Paper titled, "The Grain Issue in China," 31 China has favourable and rich water resources to meet its requirements of food and will be no threat to the world food market. As noted earlier, China is endowed with vast seas, large inland waters and suitable climatic conditions for the growth of aquatic life. There exist about 2500 different species of fish with thousands of aquatic animals and plants with economic value. Fisheries in China has a promising future and is an important sector of China's national economy.
Over the last two decades or so, Chinese fisheries production has grown many folds. The industry has evolved itself into a powerful industrial system comprising aqua culture, fishing, processing, marketing, fishing vessels, shipbuilding, ports, science and technology and fisheries management. It forms an important part of China's maritime power and contributes towards economic development. Since 1990, China has emerged as the top producer of fish, surpassing catches of Russia, Japan and Taiwan. Today it accounts for one fifth of the global production.
At the beginning of the reforms, the annual catch of fish was pegged at 5 million tons which has grown seven times and was 36.0 million tons in 1997. 32 China is working hard towards becoming the fishing superpower of this century. The Ninth Five Year Plan (1996-2000) of the Ministry of Agriculture has outlined fishing as an important sector. A ministry official noted that "The country is calculating every minute to realise it's plan to become a real superpower on fish catching and breeding." 33
The Chinese Government has adopted liberal policies and encouraged both domestic and foreign investments in the fisheries sector. The liberal policies permitted fisherman to sell their products anywhere and compete in the international market. Besides, the Bureau of Fisheries under the Ministry of Agriculture supports development of strategies and policies to increase output. The developments in the fisheries industry have correspondingly provided impetus to shipbuilding and the ship repair industry. It has also resulted in growth of fishing ports. Presently, the annual fishing vessel building capacity has touched 60,000 tons, repair of several thousand fishing vessels, manufacture of powerful diesel engines (150,000 kilowatts) and spare parts. 34 The total workforce engaged in fisheries is over 10 million of which one third are women.
The fishing industry contributes substantially to the overall agriculture sector. In 1994, it's share was about 8 per cent and is expected to be about 12 per cent by 2000. Accordingly, new development projects have been started to meet the increasing demand. Zhuo You Zhan, the Director General of the Chinese Fishery Administration noted that the industry will be opened wider to foreign investments to pool in financial resources. He also noted "technological progress will be the core of the development." 35 The industry has been constantly engaged in Research and Development (R&D). There are 192 fisheries. The R&D Institute employs 30,000 research staff. It also has five fishery universities and colleges which offer courses to nearly 9000 students. 36
Distant water fishing is a relatively new industry in China. It has taken active part in exploitation of fishery resources on the high seas. It is engaged in joint ventures for rational utilisation of marine resources. Importantly, the domestic shipbuilding industry has developed the capability to build ocean going fishing vessels. These have onboard arrangements for processing and canning for both domestic and international markets.
Marine Tourism
Chinese coastal areas are well endowed with natural scenic beauty. The long coastline and island territories are home to over 300 marine tourist sites. Recreational sites are being expanded to include water sports, tourist resorts and underwater recreation. In the 1990s Chinese tourism developed at a rapid pace. During the period 1993-1995 the spending by foreign tourists and foreign exchange earnings from tourism occupied the ninth and the tenth places respectively in the world. 37 Sea based tourism also made rapid progress during the same period. At the national level, tourism occupied the third position among marine industries. Income from marine tourism was pegged at 138.34,321.6 and 364.76 Yuan for 1993, 1994 and 1995 respectively. In 1997, over 10 million overseas tourists visited marine tourism sites. 38 The United Nations declared 1998 as the International Year Of The Ocean. As a prelude, the Chinese National Tourism Administration had included annual progrmmes such as-Visit China and China City, A Country Tour 1998.
One of the important Chinese marine tourism sites is located at Sanya in Hainan. In order to promote underwater tourism, a tourist submarine has been built. 39 This indigenously designed and built vessel is capable of carrying 40 passengers up to a depth of 50 meters. The tourists are given an hour long tour to various coral reefs, tropical fish and marine life sites. The Chinese marine tourism developers have begun to build theme parks. After eighteen months of repairs the decommissioned Russian aircraft carrier Minsk has been converted into a tourist attraction at Shenzen. 40 The SZ International Tourism Corporation, who apparently own the vessel, are upbeat about this development. The Deputy Director of the company was quoted as saying that Minsk and two other sites in the area would become an important part of the eastern golden beach resort. Besides Sanya, there are several tourist sites located at several other places along the coast. In the Hainan province, the Hainan Huixian Tourist Development Co. Ltd has developed the Tropical Sea World Park with private investment. 41 It has emerged as an important marine tourist center. Similarly, Zhoushan Islands received 3 million tourists, both from home and abroad, almost three times the local population. The one thousand odd scenic spots offer more than fifty tourist programmes such as sea water baths, surfing and fishing.
Today, from the southern most China-Vietnam border to the northern most China-Korean border, 196 coastal cities are actively engaged in developing marine tourism. The Chinese government has actively encouraged private participation and the sector is considered to be a foreign exchange earner. It has set for itself some impressive goals in marine tourism. In 1996, it was estimated that over the next five years i.e. by 2000, the foreign tourist traffic will touch 8.2 to 8.6 million. The Vice Chairman of the China National Administration was confident that the foreign exchange earnings will touch about $14 billion compared to $8.73 billion in 1995. In 1995, China's world ranking in terms of tourist arrivals was 5th and 9th in terms of earnings. 42
Hong Kong: The Major Maritime Hub
Since its return to mainland China, the Hong Kong Special Administrative Region has continued to maintain its glory as a major maritime center in Asia. It is the 7th largest trading entity in the world. In 1999, Hong Kong port handled 16.2 million TEUs up from 12.5 million TEUs in 1995 (1985-2.2 million TEUs, 1990-5.1 million TEUs) making it one of the busiest container ports. 43 It is reported that more than 210,000 ships made port calls in 1999 either to land/discharge cargo, for maintenance or crew changes. 44 Being the hub of maritime activity, there are over 1000 shipping related companies that cater to needs of ship owners, crew and ship repairs. Hong Kong is also a major center for finance, insurance, brokerage and legal arbitration. The Hong Kong Shipping registry is very popular among ship owners and offers simplified procedures, worldwide coverage and services.
Impact on Regional Security Environment
With opening of the markets and the Chinese economy seeking integration with the world economy, the seas have assumed an unparalleled importance. As noted earlier, in China the hinterland rail and road communications are inadequate and this has resulted in intense pressure on maritime transport. The primary Chinese interest is to ensure an uninterrupted flow of energy requirements to fuel the growing economy as well as an unimpeded access to sources of raw materials and markets for products. The enhanced economic dynamism in China, primarily based on maritime activity, has resulted in increased sensitivity to the sea lines of communications (SLOCs). At this stage it is difficult to see any state induced threats to the safety of SLOCs, but such dangers cannot be ruled out. Geostrategic realities such as choke points, long running SLOCs and naval developments in the region are indeed complex for China. It seeks an enhanced role in the region for the safety of its SLOCs.
China's regional maritime identity has undergone a major change during the last decade. Its recent rise as an important trading state, high economic growth, rising defence budget, naval modernisation and its relative importance in international fora all point to the fact that China is building its maritime power to play a dominant role in the region. As a result of the various modernisation programmes, it has emerged as a major regional power both economically and militarily. It could well emerge as the largest economy by the second decade of this century. This rise of China has widespread implications for the Asia Pacific Region. As China's maritime power grows, the manner in which it exercises its new found capability becomes an important test as to where China is heading. Its creeping assertiveness in the South China Sea, missile firing to intimidate Taiwan and threat of use of force to integrate it are all pointers towards an aggressive China. In the past it has used its maritime power to safeguard its sovereignty and maritime interests.
Implications for Indian Security
The reverberation of the rise of Chinese maritime power has been noticeable in the Indian Ocean too. The bulk of the raw materials, markets and above all energy requirements for its growing maritime power must be fulfilled from the Indian Ocean states. Besides, the Indian Ocean is home to important SLOCs and maritime choke points. These SLOCs serve as the umbilical cord of the Chinese economy. Sea borne trade, primarily oil, virtually affects Chinese daily life as also economic prosperity. The shipping lane transiting the Indian Ocean and entering the strategic choke points of Southeast Asia is of great strategic importance to China. In the event of closure, it would result in long passage, increasing demand on vessel capacity, higher cost for transportation and loss of time. The Chinese are well aware of these geo-strategic realities and have been engaged in diplomatic, economic and military initiatives to build maritime infrastructure among several Indian Ocean states to safeguard their maritime interests. The present Chinese maritime commitment in infrastructure build up, impressive as it is, is probably the beginning of the long term Chinese intent in the Indian Ocean. It would not be long before the Chinese navy would make its presence felt in the Indian Ocean in support of its economic and maritime interests. Since much of these activities would take place in India's area of maritime interest, these developments have security implications for India.
Endnotes
Note 1: Sam Bateman notes that 'maritimeness' is based on the state's dependence on the sea and this is an amalgam of factors such as maritime tradition, size of the navy and merchant fleet, dependence on sea borne trade, size of the Exclusive Economic Zone, value of offshore resources and the capability of the domestic shipbuilding industry. For more details see in "Sea Change in Asia Pacific", Jane's Navy International, October 1996, p. 26.Back.
Note 2: "Naval Officers on International Maritime Strategy", Zhonggue Junshi Kexue [China Military Science], May 20, 1997, at <http://wnc.fedworld.gov.>Back.
Note 3: See <http://www.chinavista.com/tradenews/9-182.html>.Back.
Note 4: See <http://www.coi.gov.CN/ehy50/a 1.html>Back.
Note 5: See <http://icm.noaa.gov/country?China.html>Back.
Note 6: See <http://www.coi.gov.CN/ehy50/a 1.html>Back.
Note 7: Li Rongxia, "Marine Economy: New Economic Growth Point", Beijing Review, November 10 December 6, 1998.Back.
Note 8: Information Office of the State Council, People's Republic of China, "White Paper on China's Marine Development Programme", November 1998.Back.
Note 9: FBIS-CHI-2000-0102 and also see <http://www.brs-paris.com/annual/newbuilding- a/shipbuilding3-a.html>Back.
Note 12: "China's Shipbuilding Industry in Progress", (Beijing: New Star: 1991) pp. 4-5.Back.
Note 13: See <www.bcic.com/english/opportunity/shipbuilding.html>.Back.
Note 14: See <http://www.brs-paris.com/annual/newbuilding-a/shipbuilding3-a.html.>Back.
Note 15: FBIS-CHI-2000-0118.Back.
Note 16: See "Water Shipping Developing and Opening", at <http://www.chinavistta.com/business/ciec/cn/ciec/19991214.html.>Back.
Note 18: See <http://www.web3.asial.com.sg/timesnet/data/cnc/docs/CMC/o287.htm.>Back.
Note 21: Stephen J Meyric, "Development in Asian Maritime Trade," policy paper no. 3 (US: University of California, Institute for Global Conflict and Cooperation, 1997).Back.
Note 22: See <http://www.web3.asia.com.sg/timesnet/data/cnc/docs/CMC/p287.html.>Back.
Note 24: See "China Shipping Companies keep Sustainable Growth" at <http://www.engligh.people's daily.com.cn/200007/3english/20000731-46901.html.>Back.
Note 25: See <http://www.cbbc.org/ezine/archeves/june2.html.>Back.
Note 27: Rebecca E Sundstorm, "China's Port Facilities and Maritime Infrastructure: Bo Hai Rim Port Development Strategies for the 21st Century", Nan Huai Chin Scholarship Paper, Spring 1999.Back.
Note 29: See <http://www.worldbank.org.cn?england/constant479il216824.html.>Back.
Note 30: See "Growth in China's Grain Imports", at <http://www.ifpri.cgiar.org/pressrel/062598html.>Back.
Note 31: (People's Republic of China, Information Office of the State Council November 1998) "White Paper on The Grain Issue in China",.Back.
Note 32: See <http://www.fisheries moa.gov.cn/china%20fisheries.html>Back.
Note 33: See "China Christens Plans to be a Fishing Superpower", at <http://www.info.sc.cei.gov.cn/analyses/ydcl.html.>Back.
Note 36: See"China Fisheries", at <http://www.fisheries.moa.gov.cn/china%20 fisheries.html.>Back.
Note 37: See <http:www.coi.gov.cn/eindustry/bhly.html.>Back.
Note 39: Zhang Zhiping, "Marine Tourism Popular in China", Beijing Review, November 30 December 6, 1998, pp. 14-16.Back.
Note 40: See <http://www.shenzenwindow.net?guides?military-park%20.html>Back.
Note 42: Lim Soon Neo, "Middle Kingdom Sets Tourism Goals", TNA July 22, 1996.Back.
Note 43: See <http://www.info.gov.ht/pmb.chinese/speeches/pdb200006o6.html>Back.