The Geopolitics of the Arctic: Commerce, Governance and Policy

Event Report

IDSA organized a conference on the Arctic along with the Fridtjof Nansen Institute (FNI), the Norwegian Institute for Defence Studies (IFS) and Peace Research Institute Oslo (PRIO), September 23-24, 2013. Titled ‘AsiArctic’, the conference primarily focused on the perspectives of the Asian countries - India, Japan, China and South Korea - who have been given the observer’s status in the Arctic Council and the possible challenges which might emerge from their engagement in the Arctic.

The salient points that came out during the conference were:

• The melting of ice in the Arctic has become a major concern with respect to the Climate Change debate. However this has also opened up newer economic and commercial opportunities in the region. Arctic is also important as it is supposed to have one-quarter of the world’s undiscovered energy resources. These resources will find keen focus from countries like United States, Russia, Canada, Norway and Denmark. They are also regarded as primary “stakeholder” in the Arctic.
• It is clear that the Arctic Council is only one of the many international institutions that will influence Arctic developments. In key areas such as energy, shipping and many other environmental issues, other institutions are significantly important.
• The salience of Asian countries in particular China, Japan and South Korea as stakeholders in Arctic governance is high with respect to shipping but low with respect to the management and use of natural resources. In areas of Arctic environmental governance, the Asian states have high potential saliency, both regarding power and legitimacy, but their urgency (that is, active interest in participating) appears to be low.
• The Asian states’ involvement in developing an agreed text of the Polar Code has remained low key as compared to the Arctic non-coastal states as well as the European non-Arctic states. Non-Arctic Asian states participation and support can be essential for the development of IMO-based, multilateral norms concerning Arctic shipping.
• The International Maritime Organization (IMO) is developing a code, which is expected to come into force in 2015 for vessels sailing in Polar waters in order to protect Antarctic and the Arctic from various risks. The code will address certification, design, equipment, systems, operations, environmental protection and manning and training issues. Several requirements are needed to maintain and operate ships in the region:
• Highly trained crew for icebreaking operations.
• Expertise to navigate in ice and ice classed ships.
• Knowledge of ice and snow conditions
• Ability to understand, interpret and execute surface data from satellite pictures.
• The crew may demand higher wages which will add to the overall cost of transportation.
• The key issues concern the legal regime for exploration and exploitation of the resources in the Arctic region. The Arctic Ocean is a frozen sea and almost all the land underneath it is the continental margins of five Arctic states. The mineral resources beyond continental shelves are resources of the ‘Area’ as defined under the United Nations Convention on the Law of the Sea (UNCLOS) and are the common heritage of the mankind. No state can claim or exercise sovereignty or sovereign rights over any part of the Area or its resources.
• The most imminent large scale energy project in the Arctic involving the sea is the Yamal LNG project. This is an onshore development on the eastern side of the Yamal peninsula requiring use of strengthened carriers to send LNG to Asia in summer and to Europe in winter. Novatek and Total, presumably joined by China’s CNPC, own the project. A preliminary contract for 16 ice-strengthened LNG carriers from Korea has been concluded. A final investment decision is expected at the end of 2013. The project enjoys strong Russian political support, since it is seen as a cornerstone in further development of the Russian Arctic and the Northern Sea Route.
• The region’s substantial oil, gas and mineral deposits make the issue of sovereignty and claims over them contestable and with varying interpretation. This includes the rights of both the state and the indigenous people. However, indigenous rights are often viewed as contradictory to state sovereignty. Yet, new substantial indigenous self-governance mechanisms are not only evidence of increased recognition of, say for example, the Inuit rights in many Arctic countries; they also represent a new effort towards sharing of sovereignty.

Individual Countries Interest in the Arctic

• The most prominent reason behind Russia’s growing interest in the Arctic is the increasing time during which the Northern Sea Route through the Arctic Ocean can be used for navigational purposes. Another factor is the presence of untapped natural resources which attract Russian attention. Russia’s relationship with China can form a hurdle in its increasing cooperation with Japan as well as the US. The visit of Chinese President Xi to Moscow in 2013 was a significant moment in Russia-China bilateral ties. It resulted in the signing of Rosneft-CNPC energy deal and possible Chinese access to Arctic fields and its LNG terminals. The strong bilateral ties have helped China gain the status of an Observer in the Arctic Council.
• Korea has announced the ‘Arctic Policy Advancement Direction’ in 2012 which is a study of possible navigational routes and a socio-economic study of the region. In 2013 the Korean government released the ‘Comprehensive Arctic Policy Framework Plan’. The main purpose of this is to build an international partnership on scientific research and to help in sustainable development of the business in the Arctic. Korea has signed a number of FTA’s and shipping agreements with Arctic countries. Since 2012 the Korea Maritime Institute (KMI) in cooperation with the East-West Centre of US co-host the interface of bringing experts from different countries together. This conference which consists of businessmen, scientists, policymakers etc. aims at looking for solution to the issues related to the Arctic.
• The High North is of great economic and strategic importance to Norway due to its vast resource rich ocean areas and location next to Russia in the north. The small country has fundamental interests in the workings of the Law of the Sea Convention, which grants it major rights in the management of the vast northern ocean areas and its resources. Norway aims to engage Russia in the north, but also to attract attention and support from major allies. Norway raises Arctic issues in its bilateral talks with a number of countries, takes an active role in institutions like the Arctic Council and the Barents Euro Arctic Council, and pays attention to upholding relevant international regimes like the law of the sea. Norway has also established High North dialogues with a number of countries. All in an effort to provide information about developments in the High North and to promote Norwegian views.

The salient points that came out during the discussion were:

• The Arctic Council cannot do everything. It is neither like the UN Security Council. The Arctic Council works with the help of a number of Working Groups. A study of these Working Groups is important towards gaining any perspective vis-à-vis the Arctic Council.
• There is also a need to look at the way the member countries of the Arctic Council view the involvement of the Asian countries. Each Arctic Council member state perceives the Asian countries very differently.
• There is an urgent need to resolve the issue of governance of the Arctic region otherwise it may lead to conflict in future.
• An increase in cooperation between Russia and China and how it impacts the political dynamics in the Arctic region will be important to observe.
• Polar code has a long shelf life. The objective is to keep Arctic as ecologically pristine as possible.

Report Prepared by Eshita Mukherjee, Research Intern, IDSA

Press Release [+]

Event Photographs [+]

Programme

Monday 23 September

1130 – 1200 Registration and Tea

1200 – 1210 Welcome remarks by Arvind Gupta, Director, IDSA

1210 – 1220 Introductory remarks about the AsiArctic research programme by Arild Moe, Deputy Director, FNI

Session 1: Arctic and Asia Perspective

Chair: Uttam Sinha, IDSA.

1220 – 1240 ‘Asia in the Arctic’ - Arvind Gupta, the Institute for Defense Studies and Analyses (IDSA), New Delhi

1240 – 1300 ‘The Arctic and East Asian Security: A Japanese View’ - Shinji Hyodo, National Institute for Defense Studies (NIDS), Tokyo

1300 – 1320 ‘Overview of the Korea’s Arctic Policy Development’ - Justin (Jong-Deog) Kim, Korea Maritime Institute, Seoul

1320 – 1340 ‘China’s Role in Arctic Affairs in the Context of Global Governance’ - Jiang Ye, Shanghai Institute for International Studies (SIIS)

1340 – 1410 Discussion

1410 - 1500 Lunch, hosted by IDSA

Session 2: Law, Governance and Resources

Chair: Jo Inge Bekkevold, Head of Centre for Asian Security Studies, Norwegian Institute for Defence Studies (IFS)

1500 – 1520 ‘Asian stakes and Arctic Governance’, Olav Schram Stokke, Research Professor, Fridtjof Nansen Institute; and Department of Political Science, University of Oslo

1520 – 1540 ‘Arctic: the next great game in energy geopolitics?’ - Shebonti Ray Dadwal, (IDSA)

1540 – 1600 ‘The Legal regime of the Arctic and India's role and options’ HP Rajan, Independent legal consultant

Tea & coffee break

1600 – 1620 ‘Governing the global commons: emerging trend in Arctic governance’, Dr Sumana Datta (Independent researcher earlier with TERI)

1620 – 1700 Discussion

Tuesday 24 September

Session 3: Arctic Navigation and Indigenous Rights

Chair: Justin (Jong-Deog) Kim, Korea Maritime Institute, Seoul

1000 – 1020 ‘Norwegian Arctic policy’, Kristine Offerdal, Research coordinator at the Norwegian Institute for Defence Studies (IFS) and Jo Inge Bekkevold, Head of Centre for Asian Security Studies, Norwegian Institute for Defence Studies (IFS)

1020 – 1040 ‘Polar Code and Arctic Navigation’, Vijay Sakhuja, ICWA

1040 – 1100 ‘The Northern Sea Route: Status, Challenges and Potential’, Arild Moe Deputy Director at the Fridtjof Nansen Institute (FNI)

1100 – 1120 Tea & coffee break

1120 – 1140 ‘Sino-Russian Relations and the Arctic Dimension’, Tom Røseth, Research Fellow at the Norwegian Institute for Defence Studies (IFS)

1140 – 1200 ‘Sovereignty and Indigenous Rights in the Arctic’, Ashild Kolas (PRIO)

1200 – 1220 ‘The Maritime Tiger: Exploring South Korea's Interests and Role in the Arctic’, Mia Bennett, Scott Polar Research Institute, University of Cambridge

1220-1300 Discussion

1300 – 1400 Lunch, hosted by IDSA