"China’s transition from lead bilateral banker to chief debt collector of the developing world"

We usually visit the Lowy Interpreter, here we go to the main site.

From Australia's Lowy Institute, May 2025:

Peak repayment: China’s global lending 

Soaring debt repayments and a sharp reduction in lending have transformed China’s role in developing country finances from capital provider to debt collector. Mounting pressures from Chinese debts are especially severe for many of the world’s poorest and most vulnerable countries. A retrenchment in Western aid and trade is compounding these challenges while undermining any geopolitical advantage for the West.

Key findings

• In 2025, the world’s poorest and most vulnerable countries will make record high debt repayments totalling $22 billion to China. Beijing has transitioned from capital provider to net financial drain on developing country budgets as debt servicing costs on Belt and Road Initiative projects from the 2010s now far outstrip new loan disbursements.

• China continues to finance strategic and resource-critical partners despite a broader collapse in its global lending. The largest recipients of new lending include immediate neighbours, Pakistan, Kazakhstan, and Mongolia, and developing countries that are critical mineral or battery metal exporters, such as Argentina, Brazil, Congo DR, and Indonesia.

• China is grappling with a dilemma of its own making: it faces growing diplomatic pressure to restructure unsustainable debt, and mounting domestic pressure to recover outstanding debts, particularly from its quasi-commercial institutions. But a retrenchment in Western aid and trade is compounding difficulties for developing countries while squandering any geopolitical advantage for the West.

....MUCH MORE 

Piracy: "The Mozambique Channel is the next security hotspot"

A few days ago the FT's man in southern Africa, Joseph Cotterill, made passing reference to the jihadis in less judgemental terms than I used*:

This on the same day Total said it was restarting LNG work at nearby Afungi. https://t.co/qtSj8niKgt

— Joseph Cotterill (@jsphctrl) March 24, 2021

From The Lowy Institute's Lowy Interpreter, March19:

An Islamist insurgency is spilling danger into a major shipping lane, and countries must decide who they want to fix it

The waters off Mozambique are becoming a major new security hotspot in the Indian Ocean. An Islamist insurrection in northern Mozambique that the government seems powerless to suppress has also increasingly led to disruption in the Mozambique Channel, a key global shipping route. The Quad countries and European partners must help contain the problem before other actors step into a regional vacuum.

The insurgency in Mozambique has the potential to destabilise Southern Africa and embolden Islamists throughout the region. It threatens security in the Mozambique Channel, the 1800 kilometre long waterway between Madagascar and East Africa that carries some 30% of global tanker traffic. It is also the location of some of the world’s largest gas reserves.

The insurgency was started in 2017 by groups drawn from Muslim communities on the so-called “Swahili coast”. This has now included more than 800 separate attacks across northern Mozambique, resulting in at least 2600 deaths and more than 600,000 people displaced. A report from the UN Secretary-General to the Security Council also pointed to transnational links, with Somali-based Islamists in Puntland acting as a “command centre” for Mozambique insurgents. However, other analysts discount close operational links with Islamic State.

Armed clashes escalated sharply in 2020, with attacks spilling over the border into Tanzania, where the government faces local Islamist extremists. There are also growing attacks on maritime infrastructure. In August, insurgents seized a key port in northern Mozambique from government forces, raising concerns that this is a first step in insurgents venturing into piracy, as occurred in the Horn of Africa.

Maritime drug smuggling is a key source of funds for insurgents. The so-called “Smack Track” has long brought heroin grown in Afghanistan down the East African coast, where a substantial portion is now landed in northern Mozambique before being transported to Europe and elsewhere. Heroin is also increasingly supplemented by crystal meth, produced in Afghanistan from local shrubs. 

Map reproduced with the permission of CartoGIS Services, Scholarly Information Services, The Australian National University

Another big factor is the development of a major offshore gas industry in the Mozambique Channel off northern Mozambique. This involves planned investments of some US$50 billion to extract an estimated 100 trillion cubic feet of gas, including a major onshore gas liquification plant. France’s Total and US-based ExxonMobil are major investors. In January 2021, following a series of escalating attacks, Total began to move part of its logistical operations from northern Mozambique to safety on the French-administered island of Mayotte in the Channel....

....MUCH MORE

December 29
As Tropical Cyclone "Chalane" Hits Mozambique, ISIS Declares Moz To Be The New Caliphate and Threaten $20 Billion LNG Project

....These are straight up psychopaths
From Deutsche-Welle last month:
Mozambique police: Islamists behead 50 people in troubled province

Also:
"German investors target Mozambique’s LNG, gas projects"
Careful there, German investors.*

China, Australia, Rare Earths And Policy

We have some history with these seventeen elements.

"...Words like 'uranium', 'rare earths', etc. seem to be magic to

 those unsuspecting who are often fleeced..."

Gerald M. Loeb

The Battle for Investment Survival

Simon & Schuster, 1935

From The Lowy Interpreter, June 11:

Rare earths vs rarer resources: Global ripples from Australia’s divestment decision
Climate change is a challenge China and the United States are fighting together, making technological cooperation key. 

The Australian government has issued a directive for five foreign companies with links to China to divest their stakes in Northern Minerals Limited within two months. The mining consortium is seeking to produce dysprosium, a heavy rare earth element used in powerful magnets for electric vehicles, industrial robotics and wind turbines, as well as advanced weapons systems. Treasurer Jim Chalmers made this decision on “national interest” grounds following advice from the Foreign Investment Review Board.

Australia’s move is part of a growing trend prioritising national interests over global economic integration. In 2022, Canada ordered Chinese investors to divest their stakes in lithium mines, citing national security concerns.

The risk, however, is that such moves could curb efforts to accelerate a green energy transition.

Rare earths, encompassing 17 elements, are not scarce, despite being termed “rare”. What is rare is low-cost and low-pollution processing capacity of these elements. According to the International Energy Agency, China holds a significant portion of rare earth reserves, accounting for 33.8% of global total as of 2022. However, it dominates nearly 70% of upstream mining and extraction, almost 90% of midstream processing and refining, and at least 50% of downstream applications, from electronics and electric vehicles to renewable energy technologies.

Rare earth elements, though required in very small quantities, are integral for various industrial and defence applications. China’s dominance across the supply chain has caused concerns, with former defence minister Kim Beazley highlighting that around “3,400 American weapons systems have Chinese rare earth components.”

Multinational partnerships are forming to counter China’s influence. Australia’s divestment decision signals its alignment with global allies. These efforts assume that China will use its dominance in the rare earth supply chain as a “lever” to gain an advantage in geopolitical competition.

In 2010, China imposed export quotas on rare earth elements, citing “environmental concerns and resource conservation”. This move led to a significant surge in global prices and prompted an appeal by Japan and the United States at the World Trade Organisation, which subsequently ruled against China’s export restrictions, concluding that the measures were designed to achieve “industrial policy goals” rather than environmental or conservation goals. As a result, China was forced to relax these limits.

In December 2023, China introduced the “Export Control Law” and “Rare Earth Management Regulations,” implementing strict export measures on rare earth separating technologies. These regulations are part of China’s broader strategy to tighten its grip on rare earth supplies, contributing to a recent rise in rare earth prices after years of price stagnation.

Australia is one of the world’s major rare earth producers, contributing 5.14% of global rare earth products, ranking fourth after China, the United States, and Myanmar. Northern Minerals Limited, notable for its Browns Range project in Western Australia's East Kimberley, is seeking to become the first producer of dysprosium outside of China.

Australia can probably scale up its rare earth metal and magnet operations without China’s technological inputs, but at considerable cost and over a long time. China has clear structural advantages over its competitors for at least the next 10 years....

....MUCH MORE

West of Diego Garcia, India is Building an Island Base of its Own

From The Lowy Interpreter via The Maritime Executive:

The small, remote Mauritian island of North Agalega, located in the south-western Indian Ocean, 700 miles north of Mauritius, is currently a hive of construction activity. India sought access to the islands in 2015 to develop as an air and naval staging point for surveillance of the south-west Indian Ocean – in a sense redolent of facilities other nations operate, such as the joint US-UK base at Diego Garcia.

Satellite imagery shows major airfield and port developments are well underway, reportedly worth some $87 million. Comparing the most recent images from Google Earth to the same location as seen in 2014 shows a new 3000-meter runway – capable of hosting the Indian Navy’s new Boeing P-8I maritime patrol aircraft – and considerable apron overshadows the existing airfield in the middle of the island.

India regards the new base to be essential for facilitating both air and surface maritime patrols in the south-west Indian Ocean, and as an intelligence outpost. This recent satellite imagery now indicates the scale and capabilities of this new facility. The project entails a new airport, port and logistics and communication facilities and – potentially – “any other facility related to the project." So far, project details have been tightly held by both India and Mauritius.

The imagery shows what looks like barracks and fields which could be used as parade grounds or sporting facilities located near the north end of the runway. These images do not readily show evidence of fuel storage facilities, or communications and intelligence installations – such as radomes. Such equipment and facilities are expected to be visible in future imagery.

North Agalega Island is some seven miles long and one mile wide, with a total population of less than 300 people. Until recently, it was virtually cut off from the world, with a rudimentary jetty and a small airfield barely fit for light aircraft....

...MUCH MORE

And from IndiaToday:

 

China: "The 'dual circulation' strategy announced at the National People’s Congress could shift global economics and politics."

 From the Lowy Institute's The Interpreter blog:

Endorsing “self-reliance”, Beijing raises the geopolitical stakes

China’s yearly National People’s Congress (NPC), which convened last week in Beijing, generated more attention than usual. Most of the headlines focused on the confab’s decisions to impose additional electoral restrictions in Hong Kong, a predictable but nonetheless dismal further deterioration in that city’s political vitality.

But amid the news about Hong Kong, economic growth targets for 2021, and self-congratulation for weathering the Covid-19 pandemic, the NPC also approved an ambitious economic agenda for the next 15 years. In particular, the assembled delegates endorsed the new “dual circulation” strategy – comprising “domestic circulation” and “international circulation” – a framework first coined by Xi Jinping last year. More than mere economic tweaking, this strategy, if successful, will have profound implications for global economics and geopolitics.

One the one hand, the strategy will encourage greater reliance on China’s enormous internal market (“domestic circulation”) for growth and technological innovation, rather than on capital-intensive growth, low-value exports and imported technology which spurred the country’s economic success in the past.

The other half of the strategy, “international circulation”, will double down on China’s long-standing effort known as “Made in China 2025” (MIC 2025). The aim will be to upgrade its manufacturing base through the integration of information technology to improve productivity, increase the indigenous content of higher-end technology products, reduce reliance on foreign inputs and become more self-sufficient technologically.

As Premier Li Keqiang declared in his work report to the NPC:

We will give priority to domestic circulation, and work to build a strong domestic market and turn China into a trader of quality. We will leverage the flows of the domestic economy to make China a major magnet for global production factors and resources, thereby promoting positive interplay between domestic circulation and international circulation.

The dual circulation strategy, and MIC 2025 in particular, ultimately aim to position China as the leading source of critical technologies and industrial outputs of the future across the value chain – in design, manufacturing processes, technology and material inputs, and finished products – in high-priority sectors including next-generation information technology, robotics, aerospace, high-speed rail, green energy, biopharma and new materials. Analysis by Chinese think tanks and foreign counterparts estimates that the MIC 2025 plan hopes to capture 40–80% of the global value chains in these sectors between 2020 and 2030....

....MUCH MORE

"China coup? Rumours of Xi Jinping’s decline are premature"

Following on July 4's "China's Military May Be Preparing For A Change In The Nation's Leadership": 

Note the 'may'. I don't know for a fact but there are observations that point in that direction....

And from the Lowy Institute's The Interpreter, July 10: 

Despite speculation about leadership challenges, evidence
suggests Xi Jinping holds firm control over China’s political system. 

In recent weeks, a flurry of reports has predicted the imminent downfall of China’s President Xi Jinping. Similar rumours have surfaced repeatedly over his 13-year rule – and each time have proven false. While scepticism about Xi’s invincibility is warranted, history suggests that today’s chatter will likely also turn out to be unfounded.

To be sure, something strange is happening in Beijing. Since Xi began his third term in 2022, several of his hand-picked appointees have been removed, prompting speculation about a power struggle in the Chinese Communist Party. Most of the activity has occurred in the military, leading some to conclude that Xi is losing control of the armed forces. But not all analysts agree with this assessment. Some see the intrigue as evidence of Xi’s further consolidation of power or even as infighting among his subordinates that has no effect on him.

Despite the noise, no one has credibly explained how a leader who dominates every significant CCP organisation could be toppled. All seven members of the Politburo Standing Committee are either long-time Xi allies or have served him loyally for over a decade. More than half of the broader Politburo’s 24 members are his protégés, and nearly all the others had direct ties to him prior to their appointments. The factions rumoured to be plotting against Xi lack meaningful representation in the bodies that appoint and remove senior officials. The notion that these sidelined groups have somehow outmanoeuvred a political operator as shrewd and relentless as Xi strains credulity.

Nor has Xi made a recent blunder so catastrophic that it would convince his allies that his continued rule is a liability to the Party. His Covid-19 strategy collapsed in 2022, resulting in a year of widespread lockdowns that stalled economic activity, threatened social stability, and saddled provincial governments with dangerous levels of debt. But that was three years ago. Instead of punishing Xi, the Party awarded him a precedent-breaking third term and allowed him to further consolidate his control.

For all the turbulence of Xi’s tenure, the CCP generally views him as a success. Xi has presided over China’s rise as a global power and reasserted the Party’s control of society more comprehensively than any leader since Mao. Though his handling of the economy and of US-China relations has drawn some criticism, few believe removing him would erase US tariffs or improve China’s global standing. If anything, Xi is credited with forcing Washington back to the negotiating table in the latest trade standoff....

....MUCH MORE 

Indonesia/Malaysia/Singapore: "From Gallipoli to the Strait of Malacca: Why maritime choke points still decide the fate of nations"

From Australia's Lowy Institute Interpreter blog, July 4:

How a crucial regional waterway may be affected in the event of conflict.  

The strategic relevance of maritime choke points has remained a constant throughout military history. Their control has often defined the outcomes of major conflicts, shaped geopolitical balances, and influenced global economic flows.

Exemplifying the enduring value of choke points, this year marks the 110th anniversary of the beginning of the Gallipoli campaign conducted from February 1915 to January 1916 during the First World War. A joint Anglo-French-Australia-New Zealand force attempted to seize maritime control of the Dardanelles Strait, with amphibious landings to neutralise Ottoman coastal batteries and capture the commanding coastal areas along the Gallipoli Peninsula. This would have enabled Allied naval forces to access the Sea of Marmara and the Bosporus Strait, and subsequently reach the Black Sea.

The failure of this operation, marked by immense casualties, highlights not only the challenges of amphibious and littoral warfare but also the significance of such maritime corridors in determining the strategic fortunes of nations – a sobering reminder of the historical consequences when belligerents seek to control key maritime chokepoints, which includes both maritime and land features.

Today, the strategic calculus surrounding the importance of controlling maritime choke points remains unchanged. In Southeast Asia, the Strait of Malacca represents one of the world’s most critical, congested, and busiest sea lines of communication (SLOCs). The implications of a future conflict on the control of this chokepoint, particularly involving China and Taiwan, and potentially the United States, could be profound.

Maritime choke points are narrow sea lanes that funnel international shipping through constrained passages, often bordered by the sovereign territories of multiple states. These passages, while enabling global trade, are also potential flashpoints in times of tension or conflict. Due to their geographic and economic value, they are vulnerable to interdiction, blockade, or militarisation. In the Southeast Asian context, the Strait of Malacca may be considered as the region’s most significant choke point due to its proximity to major regional and extra-regional economies, and a major sea route for the transportation of energy and goods.

The Strait of Malacca, which spans approximately 800 kilometres and ranges in width from 2.7 kilometres to 250 kilometres, serves as the principal maritime corridor linking the Indian Ocean to the Pacific via the South China Sea. Bordered by Peninsular Malaysia to the east and the Indonesian island of Sumatra to the west, it has historically served as a geopolitical magnet, drawing the ambitions of colonial powers such as Portugal, the Netherlands, and Great Britain. It is estimated that over 90,000 merchant vessels pass through the strait annually, transporting nearly 25% of global trade. Its role as a conduit for oil, liquefied natural gas, and manufactured goods underpins the economies of not just Southeast Asia but also East Asia and beyond....

....MUCH MORE 

If interested see also:

• Will China Bypass Singapore And The Strait of Malacca With A Canal Across Thailand Into The Indian Ocean?
• Will Singapore Be Bypassed? "Blocking Thailand’s solution to China’s ‘Malacca Dilemma’"
• RAND: "The Gulf of Thailand May Be the Next U.S.-China Flashpoint"
• Chinese EV battery makers are building huge factories in Morocco to cash in on U.S. electric vehicle subsidies" (and China is now camped at most of the world's chokepoints)

 
In our November 2010 post "India Orders Firms to "Scour the Earth" for Energy Supplies as President Obama Heads Over" I mentioned:

I have a hunch that American schoolkids today will be hearing a lot about the Indian Ocean before they graduate and might even be able to find it on a map.*...

...*I mean come on, just look at the land masses that border it:

Aso:
Indian Ocean Geopolitics: China Goes to the Maldives
"Is China Moving to Control the Indian Ocean?" 

"Is the India–China détente real?"

From Australia's Lowy Institute's Interpreter blog, October 28: 

 

Existential differences and longstanding distrust make
the current normalisation of relations deeply unstable. 

This week, India’s private airline Indigo flew one of its A320 planes from Kolkata to Guangzhou. It was the first direct flight from India to China in five years, following its halt during the Covid-19 pandemic and the souring of relations between the two neighbours in 2020 amid the border standoff that extended the freeze. In November, more flights, including Chinese carriers, will take to the sky, connecting New Delhi with Chinese cities. The resumption of direct air services is part of the increasing number of confidence-building measures undertaken by both countries to move past a history of distrust and adversarial relations. A détente is seemingly underway. However, on closer examination, the embrace appears more cautious and fragile.

Since the October 2024 BRICS summit in Kazan, where Indian Prime Minister Narendra Modi and Chinese President Xi Jinping held a bilateral meeting, both countries have made significant progress in stabilising their border. Although criticised by the Indian opposition political parties, who term it an ad hoc move that has cemented Chinese control over vast expanses of land formerly under Indian control, a process to start negotiations on the contentious boundary issue has been set in motion. The actual process may not yield much but it gives New Delhi more time to develop its border infrastructure to match that of China’s.

In recent months, both sides have unveiled more confidence-building measures. In June 2025, China acceded to India’s request to resume the Kailash Mansarovar pilgrimage, in which Indian Hindu pilgrims travel to the holy mountain and lake in Tibet. In August, Beijing also lifted the embargo on the supply of specialty fertilisers, rare earths, and tunnel boring machines to India. Reciprocating the gestures, India lifted its five-year-long restrictive visa process for Chinese tourists in July 2025....

....MUCH MORE 

"Chinese EVs … made in the USA?"

From The Interpreter at the Lowy Institute, February 12:

The fortress built by Washington to keep Chinese electric vehicles out is no longer looking so impregnable.  

On many metrics, certainly scale and affordability, Chinese companies are well ahead of the rest when it comes to manufacturing electric vehicles (EVs). Yet the United States, long since overtaken by China as the world’s largest auto market, is far too sizeable to ignore for any global manufacturer. It remains the world’s biggest market for imported vehicles by a considerable margin.

The interconnection between geopolitics, national security and industrial policy has so far precluded Chinese EVs from meaningfully entering the US market. Tariffs of 100% imposed during the Biden administration are a blunt instrument. The Chinese auto sector’s growing overcapacity and vicious price wars have seen companies such as BYD introduce budget models priced at around US$8,000 in China.

Towards the end of 2024, Washington released a now finalised draft rule on connected vehicles, providing surety where tariffs could not that Chinese EVs will effectively be banned from US roads. Under the regulation, vehicles containing connectivity-enabling software and hardware provided by Chinese-owned entities will be prohibited from being sold in the United States by March this year and 2029, respectively. Vehicles with ever more ostentatious software-enabled features, such as on-board drones, are the clear direction of travel in the industry and particularly in China.

So a series of recent developments has offered a tantalising opening in North America – however uncertain – for Chinese EV companies. In mid-January, Canadian Prime Minister Mark Carney announced what some critics have acerbically termed a “canola for cars” deal that will allow nearly 50,000 Chinese EVs to enter the Canadian market annually at a preferential tariff rate.

Although President Donald Trump's tariffs have already partially disaggregated the previously tightly integrated North American auto market, Carney's deal still had a potent psychological resonance south of the border. Just days earlier in Detroit, the cradle of the once world-beating American auto industry, Trump suggested that the United States should “Let China come in”. Trump made similar suggestions twice in 2024.

This is unsurprising for a president whose seminal views on economics seem to have been formed during the 1980s when Washington was exercised by the threat of Japanese exports, including autos. The mythologised portrayal of tariffs as the decisive factor that forced Japan Inc to manufacture cars in the United States is a little tendentious. Still, tariffs undoubtedly provided America with leverage.

The auto industry is now taking seriously the prospect of US policy being recalibrated to allow Chinese automakers to open factories in the United States. Geely, which outsold China’s market leader BYD in total auto sales in January, is one company to watch. Speaking at a Las Vegas auto show last month, a company official declared that Geely would announce plans to enter the US market within 2–3 years.

The specific but elliptical announcement omitted many key details. There is speculation that Geely, which owns Volvo and Polestar, could build EVs at an underutilised Volvo factory in South Carolina. How this would circumvent the connected vehicles ban remains unclear. As the rules are currently written, many suspect that Volvo would need to sever ties with Geely to comply.

The most intriguing development has come from Ford....

....MUCH MORE 

"Japan, Vietnam Boost Defence Ties as South China Sea Tensions Mount"

Just a filler at Yahoo, October 19 that may point to a changing view of China.

From AFP:

Japan and Vietnam agreed to step up security and defence cooperation Monday, reaching an agreement in principle for Tokyo to export defence equipment and technology to the Southeast Asian nation.

The deal comes as concerns mount over China's increasing assertiveness in the contested South China Sea, with Beijing expanding its military presence in the region.

The pact would allow Japan to export equipment, likely including patrol planes and radar, to Vietnam, according to Japanese news agency Kyodo.

"It is a big step in the field of security and defence cooperation between the two countries that we reached an agreement in principle on the transfers of defence equipment and technology," said Japanese Prime Minister Yoshihide Suga in Hanoi during his first visit overseas since taking office last month.

"And I believe that it will advance further."

The resource-rich South China Sea is claimed in its entirety by Beijing but is also contested by Vietnam, the Philippines, Malaysia, Brunei and Taiwan....

....MORE

And a bit more on changing relations, from the Lowy Institute's The Interpreter blog, October 23:

 Reading between the lines: Duterte’s careful South China Sea speech

The President of the Philippines may stump up with more
nationalist rhetoric, but his true message to Beijing is plain.  

...MUCH MORE

"China eyes its next prize – the Mekong"

That moment you realize the aggressive behemoth upstream has both the power and the inclination to turn off the taps.
From the Lowy Institute's The Interpreter blog:

Beijing’s islands-building in the South China Sea and their militarisation, replete with surface-to-air missiles, is near complete. With guile, threat, and coercion, China can now seize control of one of the main transport arteries of Southeast Asia, making a mockery of international laws and norms.

But there is another prize in Beijing’s sights, an artery that runs straight through mainland Southeast Asia. The mighty Mekong River, which starts in China (known there as Lancang), and connects Myanmar, Thailand, Laos, Vietnam, and Cambodia, is a crucial lifeline that nourishes some 60 million people along its banks.

Control of both the South China Sea and Mekong River will strategically sandwich mainland Southeast Asia. Indeed, Beijing’s control of Southeast Asian rivers looks set to be the other half of its “salami slicing” strategy in the region.  

Famine is more terrible than the sword 
Controlling the Mekong River’s flow with dams along the waterway ultimately means controlling access to food, and therefore the livelihoods of tens of millions of people in downstream riparian communities. Of the hydroelectricity dams on the Mekong, the vast majority of currently installed capacity (megawatts) is in China, accounting for more than 15,000 MW. This includes a half-dozen mega-dams over 1000 MW, including Nuozhadu dam which churns out 5850 MW.

Together these dams can hold back 23 billion cubic metres of water, or 27% of the river’s annual flow between China and Thailand. Other dams in the lower Mekong are piddling by comparison, with generating capacity in the tens or low hundreds of MW.

The bottom line: Chinese dams can now regulate the Mekong’s flow.

This is even more pronounced in the dry season when the Tibetan Plateau contributes between 40 and 70% of the river’s flow. The impact on food and livelihoods is dramatic now, but could soon be far worse if 11 proposed mega-dams, half with some Chinese involvement, go ahead.

A recent UNESCO and Stockholm Environment Institute report suggests sediment flows in the river could reduce by up to 94% if the proposed dams go ahead, significantly affecting fish catches and overall river health. This will directly affect downstream riparian communities.

More worryingly, the raison d’être of the proposed dams and oft-cited promise of a crucial electricity boost for the economies of the lower Mekong has been found to be misguided. Many of the proposed lower Mekong dams will export their energy to China, and others will have direct negative impacts on the economy. It is projected that over the next 50 years, the cost for the lower Mekong basin economy will be a net negative $7.3 billion, with Vietnam and Cambodia the worst off. The social costs could be just as astronomical.

Dams as dominoes

During a recent trip to Laos, I encountered concerns about Chinese dams being used as strategic levers, producing unannounced upstream releases of water that impact not only communities but also new downstream dams. In such a case, the downstream dams would need to immediately release water through the spillway, at best resulting in the loss of valuable generating capacity, potentially impacting electricity supply, and at worst flooding downstream villages or damaging the integrity of the dam wall.

Already many of the dams on the tributaries of the Mekong are uninformed of upstream releases in the Mekong proper, potentially affecting their own release of water by creating a flood surge when the released waters converge. One of the operators of a joint venture dam in Laos confided that there was often little or no forewarning when water from a Chinese-built upstream dam was released...MORE.

"Are India and Pakistan now at war?"

From the Lowy Institute's The Interpreter blog, May 7:

What we know so far. 

Overnight, India has conducted missile strikes in Pakistan and Pakistan Administered Kashmir as part of “Operation Sindoor”. Reports suggest there have been at least 24 strikes across nine target locations and that explosions could be heard across Kashmir. This is part of India’s response to the Pahalgam attack that occurred last month in Indian Administered Kashmir which left 26 people dead. Here is what we know so far.

• At least eight people have been killed as a result of the Indian strikes, with more than 30 people injured.
• Pakistan’s Lt General Ahmed Sharif Chaudhry claimed just hours ago that Pakistan’s military had shot down two Indian air force jets.
• There have been multiple exchanges of fire across the Line of Control (LoC) that separates Indian Administered Kashmir from Pakistan Administered Kashmir. This has killed at least three people so far.
• Kashmiris are still experiencing a crackdown by Indian security forces that began shortly after the Pahalgam attack. This includes mass surveillance, home demolitions, cordon and search operations, and numerous detentions.

The next few hours will be crucial.

• On the ground in India, there are numerous military exercises taking place and it is believed that as the day progresses, we will see evacuation drills being practiced....

....MUCH MORE

Clicking through the "shootdowns" link, Turkey's state media Anadolu Agency is now reporting five Indian Air Force planes shot down. If true, that is a minor disaster for the IAF. We shall see  what's what later in the day.