Necklace of Diamond Strategy- Developments, Challenges and Facing China’s String of Pearls

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Recently, China’s Xi Jinping secured his 3^rd term as the President of PRC. In this time, China’s increasingly aggressive stance against India and other countries in the IOR and the larger Indo-Pacific brings into focus India’s ‘Necklace of Diamond’ Strategy.

Contents

What is the strategy about?

To understand how India is working on this strategy, the region’s geography needs to be kept in mind:
- The Indian Ocean Region has 28 countries, spanning 3 continents.
- The Indian Ocean is a major route for international trade, connecting the Atlantic and the Pacific Oceans.
- Some 80% of the maritime oil trade passes through just 3 chokepoints:
  - Strait of Hormuz
  - Malacca Strait
  - Bab el Mandeb Strait
Both India and China have been racing to establish presence in the vicinity of these routes, for choking these routes means having a leash on the other’s economy. For instance, ex-Chinese president Hu Jintao coined the term ‘Malacca Dilemma’ to refer to the risk posed by various factors, that could block the southeast Asian strait, to Chinese economic development.
This idea of choking the other with a string of ‘pearls’/ ‘diamonds’ forms the core of the India’s and China’s strategies.
The phrase ‘Necklace of Diamonds’ Strategy was 1^st mentioned in 2011, by the then- Foreign Secretary Lalit Mansingh. He used the term to refer to India’s efforts to protect its interests, in response to China’s String of Pearls Strategy.
It is to be noted that, unlike ‘SAGAR’, ‘Look East/ Act Policy’, etc., ‘Necklace of Diamonds’ Strategy is not an officially promulgated strategy, but rather a phrase used to interpret certain government policies by commentators i.e. the phrase hasn’t found mention in official discourse.
This strategy involves putting in place a competitive network of alliances– with military, security and economic angles.
Under this strategy, India is cooperating with strategically located countries like Indonesia, Japan, Mongolia, Oman, Seychelles, Singapore, Vietnam, the Central Asian Republics, etc. to ‘garland’ China.
The strategy mainly involves use of
- Joint defence exercises
- Port calls
- Reciprocal visits by military delegations
- Combined trainings
- Economic cooperation

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What has been done till now?

Ports:

In 2018, India signed an agreement, the Bilateral Agreement for Navy Cooperation, with Singapore to gain access to the Changi Naval Base.
- Notably, this is the 1^st agreement India has signed with a country located east of the Malacca Strait. The Strait is considered as China’s Achilles Heel given how 80% of the country’s oil and hydrocarbon imports pass through this route.
- This agreement enables the Indian Navy to access the naval base, strategically located near the South China Sea.
- The agreement allows the Indian naval vessels to avail logistical support such as refuelling and replenishing supplies
In the same year, Indonesia gave access to the Sabang Port located at the Malacca Strait’s entrance.
- The countries partnered to develop the deep sea port, in addition to other connectivity and infrastructure projects in the area.
- The Sabang Port’s 40 m depth enables the stationing of a variety of naval vessels, including submarines.
India and Myanmar are cooperating on the Kaladan multimodal project.
- This $484 million project includes the Sittwe deep-water port, constructed by India on Myanmar’s western coast.
- In 2021, the Union Shipping Ministry announced that the port is set to begin operations and would help cut goods’ transport cost and time.
India and Bangladesh are cooperating on the Mongla Sea Port project.
- The neighbours signed an initial transhipment deal in 2015 and a more detailed agreement in 2018 to modernize this port on the southwestern coast of Bangladesh.
- In August this year, the seaport received its first Indian cargo-bearing vessel.
- In addition to this, India has access to the country’s Chittagong Port.
India ratified a 2015 agreement with Seychelles in 2018. This is an agreement to jointly develop a base on the Assumption Island.
- Note that this site lies close to the Mozambique Channel.
- This deal initially suffered due to Chinese influence over Seychelles. However, it was rescued following India’s offer of a $100 million line of credit and a Dornier-228 maritime reconnaissance aircraft to Seychelles.
- In 2019, India appointed a former army chief (Gen. Dalbir Suhag) as the High Commissioner to Seychelles. This marked the 1^st time in 38 years that an Indian army chief was appointed as a foreign mission’s head, reflecting the strategic importance accorded by Delhi to its southern neighbour.
In 2016, a tripartite agreement, involving India, Iran and Afghanistan, to develop the Chabahar Port was concluded.
- This port, located on the Makran coast of Iran, lies on the coast of the Gulf of Oman.
- Following recent political turmoil, Afghanistan is no longer actively involved in this deal.
- However, India and Iran are close to concluding a long-term agreement on this project.
Also in 2018, India gained access to Oman’s Duqm Port that overlooks the Gulf of Oman, Arabian Sea and the Indian Ocean.
- The Duqm Port is strategically situated near the Strait of Hormuz and the Gulf of Aden.
- This port is located between Pakistan’s Gwadar Port and Djibouti in the Horn of Africa- 2 important strategic Chinese holds.
- India had deployed an attack submarine and maritime patrol aircrafts at the port.

Partnerships:

In 2020, Japan and India signed the Acquisition and Cross-Servicing Agreement to enable exchange of services and supplies during exercises and port calls.
- Note that Japan is only the 6^th country to conclude such an arrangement with India, after USA, France, Singapore, South Korea, and Australia.
India offered a $1 billion loan to Mongolia and is helping China’s northern neighbour build its 1^st oil refinery. This refinery would reduce Mongolia’s dependence on fuel imports from Russia.
Tin 2015, the current Prime Minister became the 1^st Indian head of government to visit all the 5 Central Asian countries in one go.
In 2021, India and Saudi Arabia conducted the Al Mohed Al Hind, the 1^st ever naval exercise between the 2 countries. Apart from this, India has been taking part in other defence exercises with the Gulf nations, like the Zayed Talwar with UAE and the multi-nation Desert Flag exercise.
A $1.2 billion-worth Indo-Omani joint venture to develop Middle East’s largest sebacic acid plant is located in the Port of Duqm SEZ.
The Asia-Africa Growth Corridor is a project undertaken by India and Japan. It is considered as a counter to China’s BRI.
In 2021, India, Sri Lanka and Maldives agreed, under the ‘Colombo Security Conclave’ framework, to cooperate on the 4 pillars:
- Marine Safety and Security
- Trafficking and Organised Crime
- Terrorism and Radicalisation
- Cyber-security
India launched the Act East Policy to economically integrate with the Southeast Asian countries. This policy has paved way for concluding strategic agreements with Indonesia, Japan, Philippines, Singapore, South Korea, Thailand and Vietnam.
India has been boosting its defence exports as well. The defence exports crossed 13,000 crore INR with the private sector exports accounting for 70% of the total. A significant portion of the increase is attributed to sales to the Philippines, Indonesia, Vietnam and other southeast Asian countries, West Asian countries and Africa.

Coastal Surveillance Radars:

Coastal radar networks is another means through which this strategy is taking shape:
- Bharat Electronics Ltd established a network of 46 coastal radar stations and 16 command and control system along the Indian coast in 2015.
- India has been partnering with its neighbours to establish surveillance radar systems along the coastlines of Bangladesh, Maldives, Sri Lanka, Mauritius and Seychelles.
Apart from this, India is working on strengthening the Andaman and Nicobar Islands
- The islands are being developed into a tri-service command.
- In 2017, the Island Development Agency was established to enable its sustainable development into an economic hub.

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What are the challenges?

The Necklace of Diamond Strategy is exclusively defensive in nature.
It is criticized as a feeble strategy compared to China’s much larger String of Pearls Strategy.
While China’s pursuance of its Five Finger Policy, with Tibet as the palm and the fingers being Ladakh, Nepal, Sikkim, Bhutan and Arunachal Pradesh, has translated into incursions into even the settled areas of Ladakh and Sikkim, New Delhi is yet to find a lasting response. The Indian strategy has proved insufficient in enforcing territorial integrity along the LAC where China has been salami slicing into India’s side.
While like-minded nations, like the ASEAN, have acknowledged India’s many credentials- a democracy, a growing economic power, an IT pivot, a nuclear weapon state and a state possessing an experienced professional defence force- the countries continue to doubt India’s ability to measure up to larger regional strategic expectations. This doubt stems from New Delhi’s indecisiveness, bureaucratic decision-making process and inability to deliver on several promises and goals.
In addition to this, China is gaining influence through its debt trap diplomacy. Its consequence can be seen from Sri Lanka being forced to approve the arrival of a Chinese vessel at its Hambantota Port.
China has been strengthening its ties with the SAARC members– Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka. For instance, it has been providing equipment like submarines, combat aircrafts, battle tanks, etc. to SAARC members.
China has been using Pakistan as a cost-effective strategy to pin New Delhi down.
These String of Pearls and Debt Diplomacy strategies have now morphed into the Maritime Silk Route and BRI– strategically similar but with a much grander scale of expansionism, encompassing Africa and Eurasia.

What is the way ahead?

As the geopolitical competition intensifies between India and China for gaining strategic influence in the Indo-Pacific, it is to be noted that, like how India is wary of growing Chinese assertion, the Chinese too remain wary of India’s growing engagement with the countries of the region and its ability to limit Chinese outreach in the IOR.
This can be seen from how the 2016 Annual Report on the Development of the IOR, a report from the Chinese Academy of Social Sciences, observed that India’s diplomatic undertakings have established the country’s dominance in its exclusive sphere of influence and constrained external powers’ freedom of action.
However, while the effectiveness of the strategy remains to be seen, Indian military analysts and observers from the neighbouring countries continue to assess the Necklace of Diamond Strategy to be insufficient to ensure India’s interests.
In normal times, military diplomacy is good for optics. However, for effective functioning, India’s strategy should use alliances that are robust, concrete and most importantly, deliverable.
India needs to back its IOR strategy with its economic projects, like the International North-South Transport Corridor, Asia-Africa Growth Corridor and the Arab-Med (Arabian Mediterranean) Corridor.
- With respect to the North-South Corridor project, the US-led economic sanctions on Iran, a key link in the project, presents a major challenge.
- In case of the Asia-Africa Corridor, a lack of initiative since the initial announcement is risking a missed opportunity. India needs to restart dialogue with Japan to take the project forward.
- The Arab Med Corridor holds the most potential, given the current circumstances:
  - Improving relations between Israel and the Arab nations
  - Pre-existing logistics infrastructure to which India simply needs to connect from its end
  - Increasing demand for agricultural exports in the Arab nations, creating a significant market opportunity for Indian agriculture sector, etc.

Conclusion:

Alfred Thayer Mahan, a US Navy Admiral, is quoted as saying, “Whoever controls the Indian Ocean will dominate Asia. This ocean will be the key to the seven seas in the 21st Century. The destiny of the world will be decided on its waters.” As China continues to wield its economic and military clout to increase its presence in the IOR, India needs to step up its game to at least retain its hold in the immediate sphere of influence. Economic projects, in addition to military diplomacy, hold the key to a successful strategy.