Multivectorism as a Foreign Policy Strategy f or Kazakhstan: A Case of Russia, US, China and India
Abstract
After the collapse of the Soviet Union, Kazakhstan adopted a foreign policy strategy known as a Multivector foreign policy to attract multiple powers to invest in its energy sector. However, the New Great Game for energy soon unfolded and world powers began competing against each other for control over Kazakhstan’s energy resources. The article tries to understand how a zero-sum rivalry is manifested in the New Great Game for energy in Kazakhstan and how Kazakhstan is accommodating the game through a Multivector foreign policy. The article also tries to evaluate the potential winner of the game in Kazakhstan. The article concludes with the argument that Kazakhstan is not only balancing but also leveraging the New Great Game in its favour.
Keywords
Multivector foreign policy, New Great Game, Kazakhstan, Energy Sector, Zero Sum rivalry
Multivectorism as a model strategy for Kazakhstan in the New Great Game
Kazakhstan, over the period of thirty years of its independence has made rapid progress after managing the pains of political and economic transitions. It gradually emerged as a regional power in the region, which is a result of its economic progress and the ‘multi-vector’ foreign policy of the Kazakhstan government. Kazakhstan is one of the most resource endowed countries in the Central Asian region. According to the Oil and Gas Journal, Kazakhstan holds an estimate of 30 billion barrels of proven crude oil reserves as of January 2018. Kazakhstan also has enormous natural gas potential with proven reserves standing at 3 trillion cubic meters. 1 Soon after independence, the new government of Nursultan Nazarbayev introduced various economic, political, and foreign policy reforms to strengthen the administration and governance of the country. The abundance of resources coupled with strong government and administrative institutions made Kazakhstan a lucrative destination for great powers to invest in the Kazakh economy. This gave birth to the New Great Game for energy where great powers like Russia, China and US, and regional powers like Iran, Turkey, India, and Pakistan, engaged themselves in a zero-sum game over the energy resources of Kazakhstan.
Former President Nazarbayev’s government identified the energy sector as the focus point of the Kazakh economy and adopted a resource-based model of development. Foreign investments were a crucial element under this model in exploiting and developing the natural resources. The need for multiple partners prompted the government to adopt a Multivector foreign policy. The Multivector policy was based on developing friendly and predictable relations with all the geopolitical actors, however, without negotiating on Kazakhstan’s national interest. 2 The goal of this policy was to ensure Kazakhstan’s independence and autonomous decision making at both domestic and international level. With this policy, Kazakhstan aimed at bypassing the landlocked nature of the country by providing market opportunities and diversifying the export routes.
Theoretical Framework
Kazakhstan’s foreign policy can be understood with two major approaches of international relations theory. First, the Theory of Complex Interdependence by Robert Keohane and Joseph Nye and second, the Theory of Neo-classical Realism given by Gideon Rose. These theories provide an analytical understanding of why Kazakhstan took a liberal path in its foreign policy by adopting the Multivector approach.
Complex interdependence provides a reversed view of the realist assumptions regarding the nature of international system. It refers to a situation among states where there are different channels of contact, no hierarchy of issues and military force is irrelevant. 3 According to Nye and Keohane (1987), no state in international relations is perfect and therefore, co-operation is must to ensure their survival. States are interconnected through a web of interdependence which is fostered by common interests and shared vulnerabilities making economic cooperation more beneficial for the nation states. Unlike the traditional realist paradigm that greatly emphasises on the size of the states and their military potential, the complex interdependence theory claims that even smaller states possess their own strengths and resources which enable them to have a greater say in international politics and pursue independent foreign policies. 4
The abundance of energy resources is a crucial asset for Kazakhstan; however, its landlocked geography makes it difficult to export these resources to the world market. To play to its comparative advantage, Kazakhstan has to rely on neighbouring countries like Russia and China for export of these resources through pipelines passing through their territories. Western investment is also crucial for Kazakhstan for a variety of reasons. First, to procure equipment and technological know-how to exploit the resources and develop the oil fields and second, to diversify its market beyond Russia and China. However, Kazakhstan’s relative strength lies in the fact that great powers identify Kazakh resources as a safer and more viable alternative to West Asian resources (because of instability in West Asia). Due to geographical proximity with China and Russia, Kazakhstan becomes even more coveted for these countries. For instance, Kazakhstan is the only country through which China can import energy resources by circumventing Russian territories.
Thus, there exists a complex web of interdependence because of the shared potentials and vulnerabilities of these countries, and it is only through economic cooperation that mutual benefits can be accomplished. In spite of being a relatively smaller country, Kazakhstan, because of its natural resources, has a greater say in international affairs and it has been able to pursue an independent foreign policy.
Gideon Rose, in his 1998 review article titled Neo-classical Realism and Theories of Foreign Policy gave his theory of neoclassical realism. In neoclassical realism, both external and internal variables are considered to explain the foreign policy decisions of states. Along with power, the socio-economic structures within a state along with national resources are also to be assessed when implementing foreign policies. 5
The Kazakh Multivector foreign policy is a direct outcome of the internal factors within the country, starting from a strategic geopolitical location, the influence of ethnic Russians but most importantly, the vast energy reserves that it possesses. Kazakhstan requires multiple partners to exploit and develop its petroleum reserves crucial for its rapid economic growth and development. An analysis of both the theories clearly reveals that the cooperation with all the powers is the best strategy for Kazakhstan to leverage the benefits of the New Great Game in its own favour. The Multivector foreign policy is a logical outcome of these existing realities and it is helping Kazakhstan in developing its resource capabilities as well as creating a balance of power in Central Asia.
Genesis of the Multivector Foreign Policy
Internal Environment
Kazakhstan faced two critical challenges in its foreign policymaking after its independence. First, to construct a policy which would promptly boost the development of its energy sector. Second, to balance its historical ties with Russia, the strategic presence of China and at the same time include the West into its ambit of foreign relations. The power vacuum created after the fall of the Soviet Union gave a massive thrust to the new government to establish foreign relations with multiple partners for the development of its oil and gas resources. The disintegration of USSR had a devastating impact on Kazakhstan’s industrial sector. 6 It encountered two major economic shocks soon after independence- rapid decline in industrial output and a skyrocketing hyperinflation. Although endowed with enormous natural resources, they were poorly utilized till about the first decade of independence. Nazarbayev inherited a weak state with a delicate ethnic balance between Kazakhs and Russians. This led to sizeable economic uncertainty. Mass migration coupled with declining foreign capital inflows rapidly held back the development of the oil and gas sector. The new government adopted radical reforms on the model of Russia but failed to give due heed to macroeconomic stability and therefore economic reforms became a stagnant reality for the new state for at least a decade. 7 A liberal and inclusive approach towards foreign policy was required to help the country recover from these shortcomings. The best move for Nazarbayev government was to come up with a balanced and pragmatic foreign policy whereby it could retain its bargaining power (using tactical manoeuvring) at the same time prevent any one country from imposing overwhelming dominance in Kazakhstan’s resources. 8
External Environment
The Russian Factor:
The Russian factor was probably the most important factor to be considered during formulation of the Multivector foreign policy. Not only Kazakhstan emerged of the erstwhile USSR, but it also shares the longest border with Russia and its large ethnic Russian population invariably reinforces its historical and cultural ties to Russia. 6 With such close connections, Kazakhstan was in a tight grip of Russian dominance especially over its energy sector. Kazakhstan wanted to circumvent this dominance by joining hands with other powers like China and the West and other regional actors, however, still maintaining a functional relationship with Russia. 9 There were other factors responsible for Kazakhstan’s reluctance to leave Russia’s sphere of influence. First, Kazakhstan’s industrial sector was hugely tied to the Soviet economic system, which put its oil and gas sector at a higher risk. Despite possessing substantial hydrocarbon resources, Kazakhstan was still importing vast supplies of oil and gas from Russia and Uzbekistan respectively. According to World Bank Report 1994, energy accounted for 32% of Kazakhstan’s total imports. Also, a larger part of oil and gas extracted from Kazakhstan was processed in Russia and Russians had a historic monopoly over all the oil and gas pipelines. Second, the ethnic Russians in Kazakhstan, mainly on its North-Western part and their separatist intentions presented a potential threat to Kazakhstan’s territorial integrity. Third, Kazakhstan, also heavily relied on the Russian military for defending its long border with China. Following suit, Kazakhstan joined the Russian led Commonwealth of Independent States (CIS) on December 21st, 1991. 6
United States Alliance:
To rescue from Kazakhstan’s potential economic collapse in 1991, the government turned to the West, particularly the United States to assist in restructuring its economy. The United States played a very distinctive role in the democratic development of Kazakhstan by helping to create a free-market economy characterized by large scale privatizations and welcoming foreign investments. The Kazakh government was instrumental in gaining the trust of the Americans and portrayed itself as a reliable strategic partner by voluntarily renouncing its nuclear weapon status. The 1993 US-Kazakh Co-operative Threat Reduction Agreement pledged support for further co-operation in prevent illicit weapons trade in the region. 10 After his first Whitehouse visit in February 1994, President Nazarbayev reiterated on the importance economic assistance to Kazakhstan from the US and multilateral organizations like IMF and World Bank which is stated as follows:
‘It was very important for us to establish political and economic relations, and to enlist the support of the USA at a difficult time. Moreover, I was grateful because the USA actively supported us, so that the donor states should help Kazakhstan with advantageous credits for supporting our currency and our reforms [referring to the IMF and the World Bank]. I think we managed to achieve a high level of mutual understanding and trust in this, both with President Clinton and with Vice-President Gore’. 6
Therefore, investments large US firms with enormous capital were crucial to the economic stability of Kazakhstan. In the energy sector, one of the first investors was Chevron (Chevron Corporation is an American multinational energy corporation), which signed a deal with the Kazakh government on jointly developing the Tengiz oil field. As such, a joint venture called Tengizchevroil was established in April 1993. However, Russia posed as a major barricade in the due functioning of the project. From the Soviet times itself, Kazakhstan’s oil and gas pipelines have been intrinsically routed through the Russian territories and therefore even after the disintegration, Russia still continued to have overt control over the Kazakh pipelines. The only major pipeline that operated between Kazakhstan and Russia till 1997 was the Atyrau-Samara pipeline. In addition to that, Russia contended that the Kazakh oil coming from the Tengiz oil field was adulterated with a fair percentage of mercaptans and Sulphur compounds in it and thereby limiting its flow through the pipeline. Chevron duly invested 100 million dollars in technology to remove the mercaptans from the oil and thereafter flow of oil through the Atyrau-Samara pipeline was partly restored. The Russian dominance was somewhat countered when Mobil (US) bought 50 per cent share in the Tengizchevroil project. 6 It, therefore, became quite evident that the United States had an indelible role to play in Kazakhstan’s development agenda.
Chinese Influences:
Kazakhstan and China have tied that date back to history, and because of geographical proximity, they have similar security as well as economic interests. After the dissolution of USSR, Kazakhstan became one of the first Central Asian countries to establish trade relations with China. China's heavy dependence on energy imports and Kazakhstan’s fair share of energy reserves have complemented each other’s long-term energy goals. China has massive investments in the development of Kazakh oil and gas fields as well as building and restoring the pipeline infrastructure in the region aimed at facilitating imports. These numbers will only increase exponentially with Chinese investments coming under the Belt and Road initiative of which Kazakhstan is a vital corridor. 11 China also has stability and security concerns in Kazakhstan which is why their security relations are tightly linked. Chinese agenda was ensured that no Islamic revival happens in Kazakhstan, home to the largest Uyghur population outside Xinjiang. The Sino-Kazakh security partnership eventually strengthened with their cooperation in the Shanghai Cooperation Organization (SCO) 12. However, there is increased speculation among scholars that China has consistently used the SCO as a mere vehicle to pursue its regional interests in Central Asia and has failed to render it as a collective security organization. 13
The Regional Quotient:
Among regional powers, Turkey, Iran, India, and Pakistan are major pillars of Kazakhstan’s Multivector foreign policy. All these powers have deep cultural, religious, and linguistic ties with Kazakhstan which foster natural partnerships. Turkey has a long cultural and religious history with that of Kazakhstan. When the Soviet Union disintegrated, six out of the fifteen newly created states were Islamic in belief, and five among those were of Turkic origins. Kazakhstan was one of them. Thus, from its very inception, Turkey had an impactful role to play in the socio-political set up of Kazakhstan. From the time of independence, Kazakhstan actively espoused the pan-Turkism ideology and reinvigorated its cultural, economic, and diplomatic relations with Turkey. Initially, a number of student exchanges happened between both the countries. In 1992, a Turkish Kazakh University was established in Turkestan. Works of several pan-Turkism scholars like Mustafa Shokay, Dulat Mirzhakip and Akhmetzan Baitursyn who were earlier banned by the Soviets got revamped in numerous forms. 14 Due of these close cultural and linguistic ties, Kazakhstan wished to foster a friendly relation with Turkey to a larger extent by including it in its ambit of energy partnerships.
Like Turkey, Iran's influence in the Central Asian region in general and Kazakhstan, in particular, is also based on establishing its religious and cultural domain. However, Turkey and Iran could not deeply establish their respective influences in the political sphere because of Russian predominance. Kazakhstan, because of the already mentioned reasons, preferred to have closer ties to Russia for its sheers concerns for security and economic progress.
Kazakhstan and India’s relation dates back more than a millennium and both the countries reflect cultural influences on each other and share similar societal characteristics- multi-ethnic, multi-religious and multi-linguistic. Moreover, factoring India’s historically strong ties with erstwhile USSR, relations between India and Kazakhstan have only maintained a historical continuity. In fact, India was one of the first countries to give recognition to Kazakhstan and initiated formal diplomatic relations in 1992. 15 In the subsequent years the two countries deepened their economic and cultural relations through several high-level reciprocal visits. The India-Kazakhstan Intergovernmental Commission was established in 1993 and in January 2009 the two countries signed the ‘Joint Declaration on Strategic Partnership’. Bilateral trade between the two countries have been increasing significantly over the years reaching 1 billion dollars in 2017 and both countries continue to engage in a wide range of sectors like pharmaceuticals, IT, food processing, tourism etc. apart from energy. 16
The cultural and religious affinities between Pakistan and Kazakhstan are also noteworthy. Their historical linkages can be traced back to the nomadic tribes of Central Asia, especially the Scythians who came to Pakistan via the Pamir region and reached up to Taxilla and Sindh.17 Diplomatic relations between Pakistan and Kazakhstan also began in 1992 and their relation has been deeply founded on political and economic co-operation. A major importance of Pakistan lies in its ability to provide access to the Arabian sea because of its shared borders with the Central Asian region and this precisely has been a priority for Kazakh policy makers.
India’s Strategic Position
India's ties to the ancient Silk Road allowed it to have bilateral contacts with Central Asia, though these were more cultural than commercial. 18 Under the administration of Former Prime Minister Pamulaparthi Venkata Narasimha Rao, bilateral ties were fully restored. New Delhi and Almaty opened their embassies in 1992 and 1993, respectively. One worth mentioning in relation to cultural exchange is the Swami Vivekananda Cultural Centre (SVCC) located in Nur-Sultan. Among other things, it offers classes in dance, yoga, music, and Hindi, hosts Bollywood film screenings, hosts performances by foreign groups, and commemorates Indian holidays. The two nations' mutual ties have always been facilitated by art, culture, and films. 19
Kazakhstanis have always been inspired and impressed by Indian culture and family values in general. In addition, Kazakhs can apply for several scholarships offered by the Indian Council for Cultural Relations (ICCR), the Indian Council of Historical Research (ICHR), and the Indian Council of Social Science Research to pursue higher education in Indian universities. Diplomats from Kazakhstan and India are visiting each other, strengthening cultural ties. High-ranking politicians and diplomats' visits demonstrate a long-standing interest and interdependence. Academic exchanges also create the groundwork for future development and a closer bond. Increased mutual trust, understanding, and creativity will undoubtedly result from more scholarships on both sides and cultural exchange.
In the areas of science, industry, and technology, the two nations are also collaborating. For the eight sectors- counterterrorism, trade and economic cooperation, defence and military technical cooperation, information technology, textiles, hydrocarbons, and space cooperation- joint working groups have been established. Although currently insignificant, the trade relationship between Kazakhstan and India is significant to both countries and ought to be promoted. According to data from 2017, trade between the two nations was $981.8 million, which included $225 million in exports from India and roughly $757 million in exports from Kazakhstan. In 2009, an MOU was signed for space cooperation between the National Space Agency of Kazakhstan and ISRO. ISRO launched a 1.7 kg Technology Demonstrator Nano Satellite developed by Al-Farabi Kazakh National University in 2017. A civil cooperation agreement was signed in 2009, which stipulated that India would receive 2,100 tons of uranium by the end of 2014. While visiting Kazakhstan in 2011, Prime Minister Manmohan Singh also signed an agreement on the peaceful uses of atomic energy. 20
These facts raise the prospect of promising economic collaboration. Concerns about defence and security become essential to strengthening ties between any two nations. In this sense, defence cooperation between India and Kazakhstan can result in mutual advancement, as it becomes an instrument of state policy. Thus, establishing strategic alliances in the defence and security domains is essential. Given the favorable business climate in both nations, the pharmaceutical industry is another rapidly expanding sector. India imports fruit, iron, steel, and other items from Central Asia, while exporting tea, ready-made clothing, cotton yarn, and jute goods to the region. This indicates steady economic expansion that portends more prosperous times ahead. 21
The goal of implementing a multifaceted foreign policy, or multi-vector foreign policy, includes taking advantage of the financial advantages that the energy sector provides. Consequently, it is possible to further strengthen the energy-related interaction at the heart of India-Kazakh relations for both parties' benefit. The oil and gas giant Oil and Natural Gas Corporation, for example, has expressed interest in purchasing a sizable stake in a Kazakhstani oil company. The economy will eventually have to contend with inflation as a result of the depletion of non-renewable resources when a nation's economic development is dependent on them, as it is in Kazakhstan. That is, the only way forward is to abandon the use of fossil fuels and other non-renewable energy sources and embrace sustainable development practices. Joining the International Solar Alliance, a collaboration between France and India, is one such method. Furthermore, the need to create sustainable development plans is justified by the currency's value being linked to its natural resources as well as the current state of climate change and global warming. 7 In Kazakhstan, devaluation of the tenge occurred in 1999 as a direct result of low oil prices in the 1990s. As a result, Kazakhstan ought to be advancing other industries like cotton, pharmaceuticals, chemicals, and agriculture.
The New Great Game and Kazakhstan’s Multivector Strategy
Resource potential of Kazakhstan
With its geostrategic positioning in the heart of Central Asia, Kazakhstan is the largest country in the region, and it has the largest proven oil reserves among all the Central Asian states. Although Kazakhstan became an oil producer in 1911, its production was not up to the mark during pre-Soviet era. However, after the mid-1990s, with foreign investments pouring in, it exceeded 1 million bbl./d in 2003. 22
Kazakhstan is also a Caspian Sea littoral country. The Caspian Sea, along with the Caspian Basin, is rich in oil and natural gas and one of the lesser untapped energy rich areas on earth. According to the estimates of the International Energy Agency (IEA), 3.5% of the world's proven oil reserves lie in the Caspian region and a significant bulk of these reserves are in Kazakhstan. 23
Two giant onshore fields dominate Kazakhstan's current oil production- The Tengiz Oil Field and the Karachaganak Oil Field and the offshore Kashagan field in Kazakhstan's part of the Caspian Sea is likely to produce half of the country's petroleum output. Apart from oil, Kazakhstan also has a substantial amount of natural gas as its hydrocarbon reserves. However, Turkmenistan is the leading player in the natural gas sector. Looking at the exports, Kazakhstan is a light crude oil exporter. More than three-fourth of crude oil travels around or across the Caspian Sea and reaches European markets. 22
While, coal dominates the country’s energy mix, there is an increased affinity towards renewable resources as well. Hydropower accounts for approximately 13 per cent of total renewable energy production generated by hydroelectric power stations located along the Irtysh River and 87 per cent from thermal power plants. Because of the steppes, Kazakhstan also has an enormous potential for wind energy. About 50 per cent of the total land area has average wind speeds which is suitable for energy generation. 24 Apart from this, Kazakhstan is also one of the world’s largest Uranium producers. Kazakhstan has 12 per cent of world’s uranium resources and in 2019 it produced about 22,800 tU. In 2018, Kazakhstan produced 41 per cent of world’s uranium. 25
Players of the New Great Game and Kazakhstan’s balancing moves
The Central Asian energy equation is not a simple one. Russia has a relative advantage because of its cultural and historical ties to the region whereas, China and the US have ready cash-reserves to invest in various energy projects. 4 Kazakhstan’s energy policies are highly influenced by its Russian past. Russia has an upper hand over the transportation channels of Kazakh oil and gas and so it has been using it as a bargaining chip to demand favourable prices. The CAC pipeline is the main conduit transporting Central Asian gas to the international market, with Gazprom being a major stakeholder. The pipeline has been an invaluable tool for Russia to retain its dominant position in the region as the 'gatekeeper' of the Central Asian gas exports. 26 Russia’s socialist government tightly controls its oil and gas industry. This often leads to production inefficiencies leading to high costs of Russian oil, prompting the potential buyers to look for viable alternatives. This is where Kazakhstan comes in. Kazakhstan, backed by its abundant oil and gas reserves, serves as an appropriate alternative to the energy-hungry nations in Asia and the West. Therefore, the goal of Kazakhstan’s Multivector foreign policy is first, to portray itself as a prominent energy supplier in the region, second, to diversify its buyer pool so that it is not solely dependent on one country to sell its oil to and third, to diversify its pipeline infrastructure to circumvent Russia’s dominance. Kazakhstan understood its vulnerable position being a landlocked country surrounded by Russia and China, it started to diversify its export routes through the Baku-Tbilisi-Ceyhan (BTC) pipeline and, the China National Petroleum Corporation (CNPC) pipeline through China. This way, China not only diversified its pipelines but also gave a good competition to Russia for European markets. 27
Moscow's monopolistic ambitions in Kazakhstan's oil and gas sectors have been primarily countered by China because of its rapidly growing energy demands. For China, the economic development and stability of the Central Asian countries would help in promoting regional stability which is vital for its flourishing trade. 28 China’s perception of the Central Asian region as a safe source of energy compared to Middle East and, Kazakhstan's long- term goal of diversifying its energy supply routes, complement each other's strategic interests. For China, Central Asian energy is much more attractive because the US Navy cannot block its flow to China. 29
Kazakhstan is a critical node in China's Belt and Road Initiative with China investing over 30 billion dollars in the Kazakh energy sector and it is only going to increase exponentially in the years to come. The Belt and Road Initiative (BRI) not only offers a lucrative prospect for Kazakhstan’s economic development but also offers a chance to bridge itself to Europe and China, thus subverting its landlocked character. Although other dimensions of Chinese presence are contentious, nevertheless, Kazakhstan perceives China as a reliable partner, at least on the energy front because of its strong financial backing. China is unlikely of defaulting on its payments, thus making it a win-win situation for both. Shireen Hunter, a political scientist also points out the complementary nature of the two country’s economy since instability in Afghanistan and sanctions over Iran, makes China the shortest and cheapest outlet to the world market for Kazakhstan. 30 Kazakhstan also wants to avert any possible ethnic extremism from its complex ethnographic structure which has some commonality with the Xinjiang province of China. 28 Moreover, with over 1.4 billion population, China appears as a lucrative market for Kazakhstan’s resource exports.
Kazakhstan for a long time has welcomed Chinese direct investments for the exploration and development of its hydrocarbon resources as well as building of new pipeline infrastructure. The first instance of Chinese involvement in Kazakhstan began in 1997 when CNPC acquired over 60 percent share of rights to explore the Zhanazhol Oil Field, and after that, it established its influence by means of mergers and acquisitions of relevant actors in the Kazakh oil industry like PetroKaz. The CNPC thus established itself as a dominant non-Russian as well as a non-Western actor playing a pivotal role in Kazakhstan's energy economy. Kazakhstan’s KazMunaiGas and China’s CNPC have jointly developed the first transnational pipeline which would transport crude oil from Kazakhstan’s Atyrau district directly to the Chinese markets via the Alatau Pass, surpassing Russian territories. The pipeline project was one of the most significant investments China had undertaken in overseas petroleum development. 31 However, China’s involvement in the Caspian region has remained limited because of overarching concerns from western investors and the prevailing conundrum in the region regarding its legal status. 32 China's pledge to secure its energy supplies is strongly tied to the military assistance that it has been providing beyond its borders to Central Asia. From a Kazakh perspective, the security of the energy supplies is as much crucial for it as it is for China because of its hydrocarbon-based export-dependent economy. Chinese presence, hence, acts as a safeguard to Kazakhstan’s own energy resources.
Kazakhstan has been immensely mindful of not antagonizing Russia in pursuance of its new policies with China. It is aware of the fact that its security is closely linked with Russia, and its stability is vital for uninterrupted energy trade. For the Kazakh government, Russia is the only reliable source of 'hard security' in the event of a sudden collapse of Afghanistan. 33 The security cooperation between the two countries have been mainly in two fronts—firstly through the Collective Security Treaty Organization (CSTO) and secondly through bilateral agreements. From a regional integration front also, Russia is the most credible partner for Kazakhstan. Putting in solid geostrategic terms, Russia is the 'window of the world' for Kazakhstan as the majority of its natural infrastructure is connected to it and to achieve Kazakhstan's goal of complete regional integration, Russia will have a huge role to play. 33 Nazarbayev’s idea of Eurasian integration is quite different from the classical notions of Eurasianism. In Nazarbayev's version, there is an absence of animosity towards Russia as well as the United States and the participation of both sides is considered crucial for successful regional integration. 27 However, the Ukraine crisis can be a major bone of contention in Russo-Kazakh relations.
A defining feature of the Multivector foreign policy is to provide tactical concessions to Kazakhstan’s partners to crush their fears of losing relative power position in the region and leveraging big partners against each other as a means of dodging the dominance of either one of them. 8 Kazakhstan's stand on the issue of the demarcation of the Caspian Sea reflects the adept use of tactical concession. It initially preferred to divide the Caspian Sea into numerous national sectors where each littoral state would have exclusive authority over their respective sea division, whereas Russia wanted joint control by all the littoral states because of the location of the prime energy deposits outside Russian share of the seabed. However, Nur-Sultan yielded to Moscow's demands so that a steady flow of Russian investment could be ensured in its oil and gas sectors. But later Nur-Sultan reverted to its favoured position when Western companies began exploring the Caspian oil, and with their support, an agreement was reached in 2018 that divided the Caspian Sea into respective territorial zones. 8
The US has a strong geopolitical agenda in Central Asia, firstly to tap the region’s energy reserves and secondly, to create a new balance of power in the region. The attacks of 9/11 and the war in Afghanistan dramatically transformed US’s policy interests in Central Asia. American military presence in Afghanistan, Uzbekistan and Kyrgyzstan began showing signs of permanence and Russia and China became increasingly wary of US moves in their backyard. 34 Kazakhstan grabbed this opportunity to construct a strategic partnership with the US by getting involved in 'War Against Terror' and rebuilding Afghanistan. Thus, Kazakh security partnership with the United States serves two primary purposes- first, creating a balance against Russia and China and second, ensure stability and reconstruction of Afghanistan which is crucial for the security dynamics of Kazakhstan. The US’s presence in Kazakhstan is also profoundly resonated in its large-scale investments in the latter’s energy sector. So much so that Kazakhstan receives the highest amount of FDI in its energy sector from the US among all the major powers in the region. Kazakhstan's close cooperation with US oil companies like Chevron, Exxon Mobil and Conoco Philips has not only balanced Russian and Chinese investments but also has brought cutting edge technologies and know-how to the country. 35 However, the US’s presence has led to grave suspicions in the minds of neighbouring Russia and China as well as Iran. As Fouskas and Gökay have observed, the vast oil and gas resources of Eurasia has the potential to motivate the United States to launch military operations against China and Russia along with other regional powers. 36
The European Union's strategic interests in the Central Asian region and Kazakhstan, in particular, is because of three main reasons- first, because of the member country's constant rise in energy demands, second, it wants to reduce its energy dependence on Russia and third, empowering the region to block religious extremism, separatism, and drug trafficking. For the EU, the Caspian region appears as a viable solution in diversifying its energy sources. For this reason, the settlement of the Caspian Sea's legal status is very crucial not only for the littoral states but also for the European Union and the US indirectly. For Kazakhstan, the geopolitics of the Caspian Sea is very crucial for the implementation of its foreign policy. This is because the Caspian oil serves as a pretext for penetration and a justification for the presence of extra-regional powers in the region. 37 Although, the August 2018 Convention on the Legal Status of the Caspian Sea delimits the sovereign water zone of each littoral state, however, the sectoral division of the hydrocarbon-rich seabed is yet to be decided. Over the years, the basin has seen vast militarization, and Russia and Iran are developing strong navies along the Caspian Sea to behold their respective positions and prevent it from falling into the Western hands. For Kazakhstan and the other littoral states, this extensive naval development by both these countries is a threat to their security. Therefore, these countries, including Kazakhstan, have been systematically developing their own naval fleet with the help of the United States and European powers to protect their economic and territorial interests against their neighbours. EU also is significant for Kazakhstan in terms of regional integration. The EU serves as an ideal model for the creation of a true regional integration characterized by the creation of free economic space and establishment of common goals of fighting extremism and separatism following the EU's footsteps. 37
Turkey and Iran have been historically engaged in a competition for influence over the Central Asian region representing two different sets of ideologies. While Iran endorsed Islamic revivalism in Central Asia, Turkey showcased itself as the prototype of a modern secular democratic Muslim state. Turkey being a Western ally, gained full support from the Western world to widen the Turkic influence in the newly formed states while Iran’s ideologies were considered to be deemed against Western interests. In fact, the US was so bent on diminishing Iran's influence in the Central Asian region that the Clinton Administration declared containment and isolation of Iran as a strategic goal. In the present context, although Iran's ambitions towards Central Asia lack any Islamic underpinnings, however, the US is still following its strategy to side-line Iran from the region, especially from its energy sector. Hence, Iran's go-to strategy has been to keep Russia as a close ally, which eventually only turned out to be a one-sided affair. 38 Turkey maintains a moderate economic presence in Kazakhstan with decent turnover in their bilateral trades. 39 The Kurdish insurgency in Turkey has limited its attention on Central Asia. 40 But, post 9/11, Turkey increased its military assistance to Central Asia, particularly Kazakhstan and Uzbekistan. Nonetheless, both the countries have emerged as two competent players in the New Great Game, and they have prominent stakes in Kazakhstan's hydrocarbon sector. While Turkey aims to reduce its reliance on Russian and Iranian gas, Iran has high stakes in the Caspian Sea’s hydrocarbon resources. This complements Kazakhstan’s long-term goal of diversification of buyers as well as pipeline infrastructure. Turkey, backed by the United States has initiated various pipeline projects in the Central Asian region, the most important being the BTC pipeline. Although Iran is an essential player in Kazakh oil resources, the division of Caspian Seabed has been a prominent bone of contention between them. Iran insists on dividing the Caspian Seabed as per its agreements with USSR in 1921 and 1941, and Kazakhstan favours its division based on territorial zones. Although Central Asian countries like Kazakhstan, view Iran as a prominent actor in growth and trade in the region, there are grave concerns regarding Iran's developing nuclear capacity and regional ambitions. 41 But Turkey may be ahead of the game in this regard because of Kazakhstan government’s constant re-emphasis on Turkic Eurasianism based on a pan-Turkic identity. Since independence, Kazakhstan has developed a strong sense of belonging within the Turkic world and pan-Turkism has been a vital element of the country’s national identity policy. Observers believe that Kazakhstan, being the most stable and resourceful country in Central Asia is actively pursuing the policy of Eurasianism and taking concrete steps to promote it. A solid regional integration in the form of the Eurasian Union can serve as a balancing component to the European Union of which Turkey has been trying to get a membership of for many years now. 42
India has always regarded the Central Asian region as its 'extended neighbourhood,' and both regions share a long history. In the present context, Central Asian region and Kazakhstan, in particular, is of strategic significance to India and vice versa to maintain regional stability, specifically along Pakistan and Afghanistan borders. Despite close bilateral ties, connectivity has remained a major obstacle in economic cooperation between the two countries. Hence, it is an ardent necessity for both India and Kazakhstan to jointly focus on the Iran route as well as the North-South Corridor. 26
India also has vital interests in Kazakhstan's oil and uranium resources. India’s GAIL has significant investments in Chinese gas pipeline projects in Kazakhstan. 34 From a Kazakh perspective, a strategic partnership with an emerging power like India will only reinforce Kazakhstan's Multivector policy. With a market of more than one billion people, and an increasing industrial growth, India emerges as a lucrative destination for Kazakhstan’s oil and gas dependent economy. Kazakhstan views India as a friendly power and the latter’s soft power diplomacy has been able to awe most Central Asian countries. India’s vivacious economic growth in spite of being a multi-ethnic and multi-religious country can serve as a role model for Kazakhstan, which also has a multi-ethnic population. 26
In response, the cardinal objective of Pakistan’s strategic interest in Kazakhstan is to secure its energy interests in the wake of an acute energy crisis being faced by the country for many years now. Although, Pakistan’s major oil imports come from the Gulf region, Central Asia is the most cost-effective energy source for the country. However, the existing global and regional dynamics of world politics especially after 9/11 and Pakistan’s support to the Taliban, and its long running political instabilities have led to increasing concerns among Central Asian policymakers. In spite of this, Pakistan is an indispensable asset for Kazakhstan because of its sheer closeness to the region. Pakistan provides the shortest access routes to a landlocked Kazakhstan into the Indian Ocean and ultimately to the rest of the world. 17 This is mainly done through a network of roads and railway links, for instance, the Kazakhstan-Turkmenistan-Iran Railway connects Kazakhstan with the seaports of Pakistan.
Potential winner of the New Great Game
The New Great Game has taken a hot seat in Kazakhstan for its natural resources; however, it is essential to evaluate which player is winning the Game. The following graphs gives a comparative analysis of Kazakhstan’s trade with Russia, China, and the United States.
|
Country |
Export |
Import |
|
China |
+ 4.2 percentage points |
+ 12.96 percentage points |
|
Russia |
- 10.36 percentage points |
- 7.1 percentage points |
|
United States |
- 1.22 percentage points |
- 1.29 percentage points |
After analysing the export and import data of 2000 and 2017, it is seen that Russia is the largest trade partner of Kazakhstan in terms of percentage share of trade. However, over the years (2000-2017) the bilateral trade with Russia and US has witnessed a steady decline while trade with China has increased by several percentage points. Therefore, it is safe to say that Russian position has relatively weakened in Kazakhstan and China appears to be emerging as the leading player in the Game. Chinese deals are more lucrative in terms of investment, market opportunities and, pipeline infrastructure development which makes it easier to penetrate the Kazakh market.
There is no denying to the fact that energy resources laid the foundation of the Kazakh economy and still act as its backbone. But parallelly, the government also focused on diversification of the economy and technological advancement which resulted in its rapid economic development. By implementing the Multivector policy, the Nazarbayev government ensured a steady flow of foreign direct investment into the energy sector as well as other tertiary sectors. Nazarbayev’s primary concern was to ensure the country’s independence and sovereignty by neutralizing Russia’s hegemony through diversifying its economic and political ties with major global powers. Through its distinctive energy and security partnerships, Kazakhstan has been able to balance as well as leverage the New Great Game in its favour and has gained recognition in the world community. History is replete with examples of how presence of multiple powers has destroyed the socio-economic and political setup of an entire country, the closest relatable example being of Afghanistan. But Kazakhstan has been able to keep itself stable and secure its economic interests. For instance, Kazakhstan intends to develop equal security partnerships with Russia and NATO to balance Chinese predominance in the SCO while on the economic front, still balancing its relations with China to develop its hydrocarbon sector. Political stability is another reason why Kazakhstan has never faced any civil wars or inside rebellion unlike its other counterparts in Central Asia like Tajikistan and Kyrgyzstan. Although the country has faced spurge of separatist movements on the northern part where ethnic Russians are dominant, however, this threat has slashed down considerably due to emigration of hundreds of thousands of ethnic Russians over the time.
According to a report by Carnegie Endowment for International Peace, Kazakhstan’s per capita GDP increased from dollar 1647 to dollar 13,172 in 2013, transforming to a middle-income country in just two decades. 43 According to 2019 Index of Economic Freedom, Kazakhstan is the 59th freest country in the world in terms of economic freedom. 44 Kazakhstan is among the only two Central Asian countries which has been declared as ‘upper middle-income economy’ by the World Bank, other one being Turkmenistan. According to UNDP’s Human Development Report 2018, Kazakhstan is the only Central Asian country that falls under high human development category with an HDI value of 0.800. 45
Multiple strategic partnerships have also helped Kazakhstan to maintain its territorial security as well as security of its natural resources. On one hand, its strategic partnership with China and Russia has enabled it to maintain stability on its eastern borders, and the other hand, its close cooperation with the US and European Union has enabled it to protect its Western border in the Caspian region. Summarising Patrick Nopen’s (2014) argument, in the event of NATO's withdrawal from Afghanistan, there can be overbearing implications in the entire Central Asian region in the form of the spillover effect of terrorism, Islamic extremism and drug-related crimes. The US-Taliban Peace Deal of 2020 brings in new security challenges for Kazakhstan and the need for stability of the region is all the more vital for all the powers active in the region to enable smooth functioning of their energy trade routes. 46 But, Kazakhstan, because of its Multivector foreign policy stands at a relatively safer position since none of its strategic allies would want it to fall into the hands of religious extremism. Moreover, the presence of multiple powers in its territories discourages any one power to exert overwhelming authority and become exploitative, which essentially acts as a second layer of deterrent for any aggression. Also, multiple partnerships have empowered Kazakhstan to diversify its buyer pool as well as the supply routes and reduce its traditional reliance on Russia. Lastly, the considerable foreign investments coming into the country is bringing in production efficiency in the oil and gas industries which ultimately results in decreased production costs and higher profit margins, thus fuelling the country's robust economic growth.
CONCLUSION
The Multivector foreign policy has greatly attenuated Kazakhstan’s landlocked character and transformed it from a landlocked to a land-linked country. By using economic cooperation as a core tool, Kazakhstan has shown how soft balancing can lead to security and stability. However, it should rise to the challenge of economic diversification and focus on increasing productivity by moving away from its mono-commodity dependence. According to the World Bank, reforming the banking sector and removing constraints in the private sector are the keys to achieve this diversification. The implementation of the Nurly Zhol stimulus package (nine billion US dollars) announced by Nursultan Nazarbayev in 2014 is crucial to increase productivity in agriculture, manufacturing, tourism, information technology, and finance etc. 47
Moreover, Kazakhstan had been successful in keeping itself out from the grips of religious extremism in an otherwise troubled region. But the Aktobe attack of 2016 was a major eye opener for the government. Therefore, Kazakhstan should focus on regional security as much as economic security in order to ensure smooth functioning of the Multivector foreign policy.
Although the Multivector policy is a winner so far, with the recent shift in power in world politics, the Kazakh government should be ready to accommodate newer changes, allowing the policy to evolve with changing courses of time and circumstances.