India, China jostle for influence in Indian Ocean

B. Raman, a hawkish, retired Indian intelligence official, expressed the fears of some Indians over the Chinese-built ports, saying he believes they'll be used as naval bases to control the area.

"We cannot take them at face value. We cannot assume their intentions are benign," said Raman.

But Zhao Gancheng, a South Asia expert at the Chinese government-backed Shanghai Institute for International Studies, says ports like Hambantota are strictly commercial ventures. And Sri Lanka says the new port will be a windfall for its impoverished southern region.

With Sri Lanka's proximity to the shipping lane already making it a hub for transshipping containers between Europe and Asia, the new port will boost the country's annual cargo handling capacity from 6 million containers to some 23 million, said Priyath Wickrama, deputy director of the Sri Lankan Ports Authority.

Wickrama said a new facility was needed since the main port in the capital Colombo has no room to expand and Trincomalee port in the Northeast is caught in the middle of Sri Lanka's civil war. Hambantota also will have factories onsite producing cement and fertilizer for export, he said.

Gearing military expansion towards China
Meanwhile, India is clearly gearing its military expansion toward China rather than its longtime foe, and India has set up listening stations in Mozambique and Madagascar, in part to monitor Chinese movements, Bedi noted. It also has an air base in Kazakhstan and a space monitoring post in Mongolia — both China's neighbors.

India has announced plans to have a fleet of aircraft carriers and nuclear submarines at sea in the next decade and recently tested nuclear-capable missiles that put China's major cities well in range. It is also reopening air force bases near the Chinese border.

Encouraging India's role as a counter to China, the U.S. has stepped up exercises with the Indian navy and last year sold it an American warship for the first time, the 17,000-ton amphibious transport dock USS Trenton. American defense contractors — shut out from the lucrative Indian market during the long Cold War — have been offering India's military everything from advanced fighter jets to anti-ship missiles.

"It is in our interest to develop this relationship," U.S. Defense Secretary Robert Gates said during a visit to New Delhi in February. "Just as it is in the Indians' interest."

Officially, China says it's not worried about India's military buildup or its closer ties with the U.S. However, foreign analysts believe China is deeply concerned by the possibility of a U.S.-Indian military alliance.

Ian Storey of the Institute of Southeast Asian Studies in Singapore said China sent strong diplomatic messages expressing opposition to a massive naval exercise India held last year with the U.S., Japan, Singapore and Australia. And Bedi, the Jane's analyst, added "those exercises rattled the Chinese."

Growing military budgets
India's 2007 defense budget was about $21.7 billion, up 7.8 percent from 2006. China said its 2008 military budget would jump 17.6 percent to some $59 billion, following a similar increase last year. The U.S. estimates China's actual defense spending may be much higher.

Like India, China is focusing heavily on its navy, building an increasingly sophisticated submarine fleet that could eventually be one of the world's largest.

While analysts believe China's military buildup is mostly focused on preventing U.S. intervention in any conflict with Taiwan, India is still likely to persist in efforts to catch up as China expands its influence in what is essentially India's backyard. Meanwhile, Sri Lankans — who have looked warily for centuries at vast India to the north — welcome the Chinese investment in their country.

"Our lives are going to change," said 62-year-old Jayasena Senanayake, who has seen business grow at his roadside food stall since construction began on the nearby port. "What China is doing for us is very good."

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