Asia and Eurasia
‘New Paradoxes’ of Russian Policy in Asia

The classic model of the “Asian paradox” in the current conditions is not applicable for Russia’s interaction with all major countries in the region. Moreover, Asia itself and the balance of power in the region have undergone changes, taking into account the active rise of China and India and a number of regional and global trends, Alexander Korolev writes.

Over the past decades, Russia’s policy in Asia has fallen loosely into the so-called “Asian Paradox”, a term that became popular in academic and expert circles in the 1990s. In other words, it can be described as “hot economics and cold politics”, a pattern characteristic of Asia, where difficult and often toxic political relations between countries go hand in hand with close trade, economic and investment cooperation.

There are two prerequisites that led to the current situation.

First, the largest sub-regions (South, Southeast and Northeast Asia) were not of existential importance for Russia to the same extent as Europe or the post-Soviet space. As a result, Russia has never been involved in political and economic processes in Asia as thoroughly as in Europe or the former Soviet republics.

Second, a specific and at the same time strategic asset of Russia for a long time was the absence (with the exception of relations with Japan) of any serious contradictions relevant for maintaining a bilateral dialogue. Relations were devoid of severe historical trauma, as well as territorial and other disputes regarding the most sensitive issues. This favourably distinguished Russia from other major players – the USA and China.

Asia and Eurasia
Russia’s Eastern Policy: Old Restrictions and New Conditions
Timofei Bordachev
The past year and a half may represent a turning point in relations between Russia and Asia. For Moscow, strengthening relations with regional powers and their economies has become not so much a choice as a necessity. The desire of the West to inflict economic and military defeat on Russia has led to a rapid rupture of many ties between it and European states, the curtailment of investment, and a serious slowdown in international trade, writes Valdai Club Programme Director Timofei Bordachev.

The peculiarity of Russian participation in Asia is that it has not only refused to accept the classic formula of the Asian paradox, but also promoted alternative models of interaction.

In fact, the “hot economy, cold politics” model was applicable only to Russian-Japanese relations, with the understanding that Russia’s level of economic interconnectedness with Japan has always been significantly lower than that of Tokyo with the United States, China or ASEAN.

With China, on the contrary, especially in recent years, the “hot economy, hot politics” model has clearly established itself. This is confirmed by the growing trade turnover, economic interdependence in general, and close political dialogue, including the participation of both countries in key multilateral formats – BRICS, the SCO and others.

For many years, we have observed a “reverse Asian paradox” in the Russian policy with regard to South and Southeast Asia, or, in other words, “cold economy, hot politics”, when dense institutional and political ties at various levels were poorly converted into real achievements in trade and the economic sphere. Thus, with the countries of Southeast Asia, the peak value of aggregate bilateral trade barely reached $25 billion and was always subject to external market factors, primarily world energy prices. The indicators of trade turnover with India until 2022 were even more modest – about 13 billion dollars, which clearly contradicted with constructive ties at the level of “high” politics.

The presented models are dynamic, and the special military operation in Ukraine has made its own adjustments. For example, in Japan there is a gradual rollback from the “hot economy” model due to the freezing of a number of investment projects. This has already affected mutual trade turnover, which at the end of 2022 dropped to $19.5 billion. A similar format is also relevant for Russia’s relations with South Korea and Singapore. Seoul and Singapore did not implement the anti-Russian sanctions in 2014, which clearly indicates the present deterioration of the political dialogue with the Russian Federation after the start of the special military operation. At the same time, in the case of all three countries, there is no talk of a complete cancellation or refusal of interaction with Russia, and such a scenario is unlikely in the foreseeable future.

Against the backdrop of the special military operation, relations with China, both political and economic, have further intensified, cementing the “hot economy, hot politics” model. In terms of scale and content, there are currently no similar analogues among China’s partners in Asia. In essence, Moscow and Beijing are promoting a new model of the Asian paradox, since, on the one hand, China has long ago transformed from a regional Asian power into a global one. On the other hand, relations between Russia and China are not supported by either formal military-political or integration obligations.

Finally, for South Asia, especially in relations with India against the backdrop of the special military operation, we see a rapid growth in trade and economic ties. Mutual trade turnover has already exceeded $40 billion and has not yet exhausted the low base effect. In fact, New Delhi has now begun to play for Russia the role that was intended for Japan and South Korea in 2014 – an alternative direction for diversifying trade, economic and investment ties as part of a turn to the East and not becoming economically dependent on China.

To summarize, the classic model of the “Asian paradox” in the current conditions is not applicable for Russia’s interaction with all major countries in the region. Moreover, Asia itself and the balance of power in the region have undergone changes, taking into account the active rise of China and India and a number of regional and global trends. At the same time, Asia has never been a homogeneous space, and in terms of political, demographic and socio-economic profiles, individual sub-regions of Asia are much more heterogeneous compared to Europe.

At the same time, Russia is not monolithic in its Asian policy. It demonstrates a different set of roles in the region – a leading supplier of weapons and, in the future, a major supplier of food for the countries of Southeast Asia, a supplier of weapons and energy security for India, a comprehensive partner and like-minded state in promoting a “new multipolarity” for China. As a result, the countries of the region also have different perceptions of the Russian Federation, which is reflected in their requests and expectations of Russia. This provides Moscow with a competitive advantage, since it allows Russia to more precisely build relationships with each partner individually. In these conditions, it is important for Russia to use the political and economic fragmentation in Asia to its maximum advantage.

Asia and Eurasia
Russia and Asia: The Paradoxes of a New Reality
Anna Bessmertnaya, Alexei Bezborodov, Timofei Bordachev, Ilya Dyachkov, Vasily Kashin, Olga Kharina, Ekaterina Koldunova, Alexei Kupriyanov, Fyodor Lukyanov, Gleb Makarevich, Irina Prokofyeva, Sergei Rabei, Dmitry Streltsov, Viktor Sumsky, Mikhail Terskikh, Alexey Zakharov, Ivan Zuenko
Back in October 2017, which may seem today a bygone era, a group of Valdai Club experts teamed up with a group of researchers to release a report titled A Look into the Future: Scenarios for Asia and Russia in Asia in the Next 20 Years.
Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.