Chinese strategists face an economic security problem in the Malacca Dilemma, describing the threat of a naval blockade of vital Chinese sea lines of communication in the Indian Ocean. It is a challenge with few easy solutions for Beijing. Despite growing Chinese power and its efforts to acquire military access and basing, win over partner countries, establish alternate routes, and build up its naval capacity, the Malacca Dilemma remains in a hypothetical wartime scenario. However, China may leverage its growing power over time to address these roadblocks by working to stabilize partners, provide security, and build up its naval power projection capabilities. The United States and its partners should prioritize countering Chinese efforts to mitigate this economic security challenge.
The Malacca Dilemma is the possibility that the U.S. or Indian navies would blockade or substantially interdict China’s Indian Ocean sea lines of communication (SLOC) beyond the Strait of Malacca (and other regional chokepointsThe 2021 accidental blockage of the Suez Canal illustrates the potential for severe economic consequences of this hypothetical scenario, which presents Beijing with a serious wartime economic security threat.
Despite mitigation efforts, Beijing has proven unable to effectively establish a dependable network of bases to facilitate power projection and secure its supply lines in the event of military conflict. China’s failure emerges largely as a result of unreliable relationships, unstable host countries, and limited near-term naval power in the Indian Ocean. U.S. policy should therefore aim to exacerbate these issues to ensure China continues wrestling with the Malacca Dilemma.
China’s Efforts to Mitigate Economic Security Risks in the Indian Ocean
China’s dependence upon sea lines of communication is largely unavoidable. Ninety percent of Chinese trade travels by sea, as do eighty percent of Chinese oil imports. Trends suggest China may reach eighty percent dependence upon foreign oil—predominantly from China is similarly on pace to become sixty-two percent dependent upon foreign Liquefied Natural Gas imports by the end of the decade. As a key Chinese military education text states: “At present and for a certain period in the future, the main route of China’s maritime transport is from the South China Sea into the Indian Ocean and the Red Sea through the Strait of Malacca.” China fears a blockade of these SLOCs through the Indian Ocean in the event of a major war.
Naturally, China has turned to its growing naval power to offset the threat. In the past decade, the People’s Liberation Army Navy (PLAN) expanded its traditional focus from “near seas defense” to “near seas defense, far seas protection.” “Far seas protection” describes the PLAN’s responsibility to defend China’s SLOCs beyond the first island chain. Whereas China previously opted to “cheap ride” on U.S. protection of Indian Ocean SLOCs, Beijing never trusted American intentions and steadily advanced its own naval power projection capacity.
Mitigating the Malacca Dilemma and defending overseas Chinese assets are increasingly prominent PLAN missions. To do so, Beijing has attempted to make use of foreign ports owned by Chinese companies to project naval power in the region. As David Brewster describes, access to civilian ports constitutes “places, not bases”—referring to port infrastructure and facilities made available to Chinese forces via formal and informal agreements with host countries. This is in lieu of large, permanent military bases ala China’s in Djibouti. “Places” represent less of a commitment; reduce rivals’ threat perceptions; and emphasize military operations other than war, such as anti-piracy; and the gray zone instead of wartime utility. Beijing employs the Belt and Road Initiative, loans, development aid, and other economic and diplomatic tools to incentivize or coerce partner countries’ participation.
Similarly, China has pursued alternate supply routes around Malacca. This has included tens of billions of dollars in overland infrastructure projects connecting inland Chinese cities to ports in Pakistan and in Myanmar. Beijing is also looking to expand energy imports from Russia, domestic green technologies and infrastructure access and diplomatic ties to Central Asia, Saudi Arabia, and Iran.
Reliable, Wartime Power Projection Remains Questionable Near-Term
Yet, China still faces serious problems mitigating the Malacca Dilemma. During peacetime, Beijing can safely project power throughout the region. However, its lack of reciprocal military alliances, stable, reliable partners and naval forces capable of contesting Indian Ocean sea control during wartime conditions mean that the dilemma remains problematic.
Beijing’s relationships are less reliable than those of the United States. Washington’s alliances have recently manifested in expanded force posture in Japan’s southern islands, rotations in Australia, the AUKUS defense pact, and strategic access to the Philippines. These alliances are not unilateral impositions by Washington but reciprocal relationships: U.S. allies welcome American security provision.
On the other hand, China has no regional military allies, instead favoring formal and informal partnerships with minimal security provision beyond security forces training. Some—such as its “all-weather” partner Pakistan—are closer than others, but not to the level likely necessary to abandon neutrality during wartime and risk belligerency.
Although avoiding alliance commitments grants China maneuverability and minimizes entanglements, it limits the depth of its relationships. Despite advancing power projection capabilities and demonstrated ability to evacuate at-risk Chinese citizens, Beijing is not yet willing to intervene militarily on behalf of partners or form mutual military alliances. This can be seen in China’s reluctance to expose itself to undue risk supporting Russia’s invasion of Ukraine until recently, as well as its backseat approach during the 2022 protests in Kazakhstan. Moreover, its pragmatic pursuit of its own national interests regardless of partner stability can backfire. Further undermining its partnerships, Beijing’s predatory loans and investments have spurred anti-China sentiment and economic instability.
Beijing’s hands-off approach extends to protecting important Chinese assets. Despite the geostrategic importance of its China-Myanmar Economic Corridor infrastructure route and port at Kyaukphyu to its Indian Ocean SLOCs, Beijing is hedging in Myanmar’s civil war. China wants stability to establish an overland route bypassing the Malacca Strait, but it has avoided risk, commitment, and responsibility. This may not be enough to achieve its aims.
China generally avoids security provision in partner countries. Although PLA deployments to defend Chinese assets in Pakistan are within the realm of possibility, Beijing prefers that partners improve their own security. In Taliban-ruled Afghanistan, China engages the ruling regime with economic tools to minimize security risks to its assets instead of attempting to provide security.
China’s preference for avoiding entangling military alliances and security provision imposes a low ceiling on the utility of its security relationships abroad. Even during peacetime, host states sometimes delay or deny PLAN access, as Sri Lanka recently did. Without guarantees of Chinese protection or security benefits, why would Pakistan risk American wrath by allowing PLAN vessels to operate out of Gwadar Port during wartime?
China’s Indo-Pacific overland infrastructure routes and its host countries are also often unstable, casting doubt on the projects’ viability. China’s $65 billion investment in the China-Pakistan Economic Corridor has been hampered by issues stemming from Islamabad’s instability, including political upheaval, economic crisis driven by debt (much of it from Beijing), and terrorism. In Myanmar, although some progress on the China-Myanmar Economic Corridor has been made since its 2021 coup and neither side wishes to risk China’s wrath by attacking its assets, the escalating civil war—which China avoids resolving—calls into serious doubt whether it can serve as a land link to the Indian Ocean.
China’s quest for civilian ports and basing similarly suffers from unreliable partners. Protests driven by economic destabilization, partially caused by Chinese loans, ousted Sri Lanka’s longtime, and generally close-to-China Rajapaksa family in 2022. Meanwhile, rival political factions in the Maldives have adopted opposing positions on China and India, a situation mirrored elsewhere in the Indo-Pacific. Whether through mercenary economic practices or interference, China risks becoming a domestic political issue in partner countries and thus could lose its influence or access in the event of regime change or elections.
Finally, the PLAN lacks the ability to contest sea control in the Indian Ocean during a wartime scenario in the near-term. The Chinese navy operates at extended distances in the Indian Ocean where India has mass and home field advantage, and the U.S. Navy can bring to bear greater and more numerous naval and air capabilities beyond the first island chain. During wartime, the PLAN may have difficulty slipping its submarines undetected past the Malacca Strait, and it currently lacks the infrastructure and basing to permanently station substantial surface and subsurface assets in the Indian Ocean. Beijing’s Djibouti base is likely too remote to adequately defend in wartime. While a second, secret facility is reportedly well underway in Cambodia, it will not substantially add to Chinese power projection capabilities outside the South China Sea.
Although China has successfully expanded its peacetime power projection, Beijing’s dearth of genuine military allies, instability-plagued partners, and limited ability to contest sea control mean that the Malacca Dilemma remains during wartime.
Can China Ever Overcome the Malacca Dilemma?
The possibility remains, but Beijing will likely need to change its behavior. In particular, China needs to reconsider Belt and Road Initiative debt in countries like Pakistan and Sri Lanka to maintain its few friends. Beyond expanding its naval capabilities, it may also need to become a dependable security provider for partnering regimes and invest in their stability to acquire reliable military access and infrastructure routes.
Xi Jinping’s Global Security Initiative suggests that China’s holistic view of national security could generate a more activist foreign policy if it perceives a threat to Communist Party regime security. China already trains foreign internal security forces, and it could consider military involvement in places like Pakistan. A greater Chinese willingness to stabilize and support aligned regimes, along with more openness to mutual military commitments, could lead to reliable basing and access in the future.
Importantly, Chinese shipbuilding outpaces that of the United States, which could also alter the Indian Ocean strategic environment in China’s favor over the medium- to long-terms. Trends suggest it could be capable of fighting a limited war in a partner country within the next 10 to 15 years. Should China achieve its goal of becoming a “world-class force” by mid-century, it stands to reason that the PLAN would be more capable of contesting sea control beyond the first island chain.
However, Chinese power projection would still rely upon access and basing in the Indian Ocean. Moreover, building dependable alliance and partner networks takes time and the shouldering of significant responsibility. The United States therefore has opportunities to counter Beijing’s strategy.
Keeping the Chinese economy insecure via the Malacca Dilemma could enhance deterrence against Beijing as the threat of war over Taiwan grows, so the United States should prioritize preventing China from acquiring access and reliable partners in the Indo-Pacific. Policy options include providing greater investment in China’s Indo-Pacific partners; avoiding alienating potential partners; countering China’s ties to countries like the Maldives, Sri Lanka, and Pakistan; and supporting transparency and anti-corruption initiatives. Additionally, the United States should coordinate with allies and partners in the region to maintain and expand its own access while building up its naval capabilities to remain ahead of China.
Source: GJIA