China‘s Energy Security Remains Reliant on Malacca Strait Despite Diversification Efforts
New Delhi - Despite a $15 billion investment in the China-Myanmar Economic corridor and exploration of alternative routes,China remains heavily dependent on the Strait of Malacca for its energy imports,a vulnerability that is intensifying great-power rivalry in the Indian Ocean region,according to a new analysis by the observer Research Foundation.
The China-Myanmar Corridor, intended to deliver oil and gas to Yunnan province, has been hampered by ongoing civil war and insurgencies within Myanmar.Operation 1027 in late 2023 exposed the fragility of the pipelines and roads traversing conflict zones, even with Chinese security measures like patrols and drone surveillance in place. Even fully operational, the corridor is projected to satisfy only 5-8% of China’s total oil and gas demand. Furthermore, any port facilities at Kyaukphyu would operate under the observation of the Indian Navy.
Alternative options, including Arctic shipping lanes and rail links to Europe, are currently insufficient to significantly reduce reliance on the Malacca Strait. Approximately 80% of China’s oil and gas imports continued to transit the Strait in 2023, highlighting the limited progress in diversifying supply routes.
“As the world shifts toward multipolarity and Washington pulls back, the Malacca Strait and its neighbouring passages are no longer just regional chokepoints. They are flashpoints of great-power rivalry,” the report states.
In response to this continued vulnerability,China is expanding its naval presence throughout the Indian Ocean,establishing a permanent base in Djibouti and seeking strategic footholds in Gwadar (Pakistan),Sri Lanka,Chittagong (Bangladesh),and potentially Cambodia,alongside fortified islands in the South China Sea. this strategy aims to create a maritime shield in the western Pacific and project power into the Indian Ocean, challenging the dominance of the US and Indian navies.
“In a multipolar world, sea lanes decide power,” the analysis concludes.
The report was authored by Atul Kumar,Fellow at the Strategic studies programme,Observer Research Foundation,and Ananya Vellore,a Research Intern with the same programme.
