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Vietnam Gets Support to Build Islands in Asia’s Most Disputed Sea While China Receives International Criticism

Vietnam has slowly added buildings on some of its 10 major islets since 2017, the Asia Maritime Transparency Initiative said in a report earlier this month

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FILE - An aerial view of Southwest Cay, also known as Pugad Island, controlled by Vietnam and part of the Spratly Islands in the disputed South China Sea, April 21, 2017. VOA

Both China and Vietnam are building up tiny islets across Asia’s most disputed sea, but while China receives international criticism Vietnam receives very little, and even gets some support because its pace of construction is slower and widely seen as defensive.

Vietnam’s work on islets it has held for decades is kept to areas of the South China Sea closest to its mainland coasts. The country shuns military mega projects that might appear offensive. And it belongs to the 10-country Association of Southeast Asian Nations (ASEAN) known for working out any bilateral differences. These factors differ from China.

“They’ve never had, I think, a standoff with any other country, because all the other claimants have respectfully kept to their developable spheres around the South China Sea, and I think there’s this intra-ASEAN consensus, that within ASEAN the claimants do not rock the boat so as to present a common front towards China,” said Alan Chong, associate professor at the S. Rajaratnam School of International Studies in Singapore.

Vietnam has slowly added buildings on some of its 10 major islets since 2017, the Asia Maritime Transparency Initiative said in a report earlier this month. The initiative under the U.S. think tank Center for Strategic and International Studies also tracked new communications equipment, a sports field and the extension of a runway from 750 meters to 1,300 meters on its largest holding Spratly Island.

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FILE – A Vietnamese floating guard station is seen on Truong Sa islands or Spratly islands, April 12, 2010. VOA

Locking in occupation

Development of military-controlled islands that Vietnam has occupied for decades in the South China Sea’s Spratly Island chain involves landfill work plus installation of solar panels on some buildings, the initiative report says. The report points also to 25 “pillbox” forts that Vietnam has built on sometimes submerged reefs or banks.

Vietnam is very slowly reclaiming land for construction that offers self-defense against harsh weather, said Trung Nguyen, international relations dean at Ho Chi Minh University of Social Sciences and Humanities. Construction has shunned use of large ships that might grab international attention, he said.

“The Vietnamese government has made it very clear they just reclaim the islands for self-defense, and they do not expand massively for other purposes,” Nguyen said. “I don’t think the Vietnamese government wants to draw a lot of attention from other countries on their reclamation, so that’s the reason they want to do it quietly.”

Hanoi hopes its tiny islets can get by without much help from mainland Vietnam, Chong said. He said the country is preparing for a long stay on the islets.

Vietnam is upgrading islets to make them harder for China to take without a cost, not for offensive military use, Asia Maritime Transparency Initiative Director Gregory Poling said.

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FILE – Anti-China protesters shout “down with invasive China” and hold placards that read “The country will not forget – Johnson South Reef – 14th March, 1988” during a gathering to mark the anniversary of the Spratly Islands clashes between Vietnam and China. VOA

“The Vietnamese endgame seems to be making these facilities more survivable, raising the cost for the Chinese to try to take them,” he said. China normally leaves Vietnam alone at sea because they have shown a willingness to “bump shoulders” with Chinese vessels if pushed, he said.

China contrast

China claims about 90 percent of the disputed sea, overlapping Vietnam’s smaller claim as well as tracts that four other governments call their own. The other claimants are Brunei, Malaysia, the Philippines and Taiwan. Chinese reclamation work particularly alarms Vietnam because China controls the full Paracel archipelago, also claimed by Hanoi, and three major islands in the Spratly chain.

Beijing’s reclamation work has created infrastructure for military aircraft and radars, the think tank initiative says. Chinese contractors had used 1,294 hectares of reclaimed land to help develop reefs and atolls under their control, according to a Pentagon estimate in 2016.

China draws attention from other countries, including the United States, when it sends bombers and naval vessels into the sea. Both China and Vietnam cite historic usage to back their maritime claims.

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South China Sea Territorial Claims. VOA

Keeping peace

China and the Philippines have complained occasionally to Vietnam over the years because its islets fall into their claims. But the complaints fade because the other countries do not see Vietnam as a threat, scholars believe.

Vietnam’s armed forces and maritime development budget lag China, which is Asia’s top economic and military power. Chinese officials meet sometimes with ASEAN leaders but lack access to the regular events for Southeast Asian heads of state, defense chiefs and foreign ministers.

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“One ASEAN country is not going to war with another ASEAN country,” said Oh Ei Sun, senior fellow with the Singapore Institute of International Affairs. “We would find consensus. That’s the true spirit of diplomacy.”

Vietnam also has picked up support from Japan and the United States, both keen to limit Chinese expansion. Japan’s agreement in 2014 to donate six coast guard vessels to Vietnam helped prove its “power projection abilities,” Chong said. The U.S. Navy regularly passes ships through the sea to warn China. (VOA)

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Amid Intensifying US China Trade Dispute, Indian Exporters Eye Gains

Orient Craft’s new unit in Jharkhand, one of India’s least developed states, will employ about eight thousand workers

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Orient Craft, one of India's largest apparel exporters, says it could benefit from increased business as the US-China trade war intensifies. This building in Gurgaon on the outskirts of Delhi houses its office and one of its garment units. VOA

As work on establishing a massive garment-manufacturing unit by one of India’s leading apparel exporters enters the final stages, the company is optimistic about keeping the machines humming. Slated to begin production in August, Orient Craft’s new unit in Jharkhand, one of India’s least developed states, will employ about eight thousand workers.

Inquiries from buyers in the United States, its biggest market, have increased in recent months as a trade dispute with China intensifies, according to A.K. Jain, who heads the Commercial department at Orient Craft. That is why he is upbeat about generating new business. “This is an unbelievable blessing in disguise,” he says. “It will give us an edge.”

Exporters in India are reaping the benefits of the trade war between the world’s two biggest economies as business with both countries jumps, according to Ajai Sahai, who heads the Federation of Indian Export Organizations.

“While overall exports have gone up by nine percent, exports to the U.S. have gone up by 13 percent and to China by 32 percent,” he says. And as the confrontation escalated last week after the two countries failed to reach a deal, his optimism increased. “Since the tariff hike is now substantial from 10 to 25 percent we feel we will have more advantage in market access.”

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A slowdown in the Indian economy is being attributed to a drop in consumption by an affluent middle class. VOA

India is among a handful of countries set to benefit from the U.S.-China trade dispute, a report by the United Nations Conference on Trade and Development stated in February. “The saying ‘it’s good to fish in troubled waters’ could apply to some bystander nations,” the report said, pointing out that most of the Chinese exports subject to U.S. tariffs will be captured by firms in third countries.

While China has opened its doors wider to a range of agricultural products from India such as rice and sugar, exports to the United States have increased in areas such as chemicals, pharmaceuticals, jewelry, auto components and apparel.

“In various products we were losing out to China with a very narrow margin. With the hike, we are able to offset that,” says Sahai. “That is why the tariff war has presented us an opportunity to enter markets in the U.S. in some areas we were hardly penetrating.”

But even as Indian exports benefit, trade experts warn that clouds are also gathering over New Delhi’s trade relationship with Washington. In recent months, U.S. President Donald Trump has slammed Indian duties on some U.S. goods, saying that India is not providing “equitable and reasonable access” to its markets.

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Economists also warn that an eventual slowdown in global trade due to the U.S.-China trade spat will hit all countries including India, which is already staring at an economic slowdown

Growth in the world’s fastest growing major economy flagged to 6.6 percent in the last quarter of 2018 – it’s lowest in more than a year. It is not expected to fare much better this year.

The slump is blamed on slackening domestic consumption, which powers the Indian economy. Unlike East Asian countries, which have raced ahead on the back of exports, growth momentum in India is largely based on an affluent middle class snapping up goods such as cars, refrigerators, air conditioners and other consumer goods.

But there are concerns as automobile sales, the barometer of consumption, plunged to the lowest in nearly eight years in recent months.

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Like other carmakers, the Hyundai showroom in Gurgaon has witnessed a decline in sales of cars in recent months. VOA

At the Hyundai car showroom in the upscale business hub of Gurgaon, near Delhi, a range of swanky models beckon customers, but there are few to be seen. This is in marked contrast to the last three years when buoyant automobile sales helped India overtake Germany to become the world’s fourth largest automobile market. That prompted car makers such as Hyundai, Honda and Toyota to expand their presence in the country.

“In recent years, March and April used to be good months. But now 20 to 30 percent drop is there in these months also,” says Gagan Arora, business head at the Hyundai showroom. “There is a slowdown in the whole industry. New buyers are not being added so frequently.”

Economists say while rising exports to the United States and China present a silver lining, the first challenge facing India’s new government due to take office after vote counting in elections is completed this week, will be how to restore overall momentum to the economy and see why consumers are not so willing to open their wallets. (VOA)