The summit’s mood was a somber one, toned down by the Ukraine war, and mounting global economic and environmental crises.
Important developments are:
Strengthening economic ties
New initiatives are planned to develop economic and transport corridors, tourism and services trade and expansion of the Belt and Road Initiative. Trade within SCO grew 12 percent annually. China aims for $2.3 trillion in trade with SCO within the next 5 years.
Today, China and Russia conducted $140 billion in trade, which will reach around $200 billion by yearend. India also increased purchases of Russian oil, coal, and fertilizer and became one of its largest fuel customers since the Ukraine invasion.
Pakistan plans to import Russian gas and Putin offered to build a pipeline to supply it. Pakistan desperately needs Russian gas because of its energy crisis.
Meanwhile, economic developments in Central Asia resulting from Russian and Chinese investments have exceeded $61 billion.
Strengthening collective security mechanisms
There has been some success in collective security cooperation. The Regional Anti-Terrorist Structure is functioning, and several new independent security mechanisms are planned. China and Russia had steadily built economic and strategic ties. Russia plans to further strengthen them.
Expansion of the SCO
Iran has now become SCO’s ninth member. Belarus seeks full membership. Egypt, Qatar, and Saudi Arabia will become dialogue partners. Turkey received observer status. Eight countries are expected to become members.
Voice of developing nations
A joint statement on climate change called for a balance between reducing carbon emissions and allowing poorer states to catch up with developed countries. SCO called for a balanced approach between emissions reduction and development.
Divisions within the SCO
Summit was expected to provide a chance for Russia and China to make a case for new world order. However, the war sowed divisions, as no government favored Putin’s actions. Clinched in confrontation with the West, Putin denied isolation, but the summit proved otherwise.
Given the war, some Central Asian leaders worry about Russian behavior. Kazakhstan and Pakistan refuse to toe Moscow’s line. Kazakhstan has aided Ukraine. China’s refusal to condemn Russia has caused unease among some countries, hindering efforts to build regional ties. Also, complicating the picture is India, which like China had not outrightly condemned Russia, nor participated in Western sanctions on it. India has strong military ties with Russia but is changing its tone. Both China and India have mildly criticized Russia. On September 21 Putin raised the threat of nuclear response in the war and ordered reservists' mobilization. He was widely condemned. America said threats were nothing new. So far, Putin seems undaunted by the criticism.
Economic cooperation between China and Russia is likely to grow to be mutually beneficial. However, China is trying to stay out of the Ukraine mess and its danger. While Putin's war has yet to spread beyond Ukraine, it could trigger a larger war between Russia and NATO. Therefore, China has wisely urged Russia to de-escalate and called for a cease-fire. China continues balancing positions as the goal of Xi’s foreign policy is to put the country first.
Since Biden supports India as a permanent member of the UNSC, it will also call on Russia not to escalate the conflict. Earlier, India had repeatedly called for diplomacy. Modi’s recent criticism of Russia is a setback for Putin as war drives a wedge in relations.
Firstly, Modi did not meet Xi. The two have not met since the border conflict more than two years ago. Delhi is wary of Beijing’s growing regional influence, especially in Pakistan. Also, the leaders of rivals Pakistan and India did not meet. Two failed opportunities.
Secondly, the summit failed to take any meaningful action on the current global food and energy crisis linked to the war. Resultantly, the regional food supply may face even bigger challenges in the future.
Thirdly, the region requires massive investment in climate resilience development. Though requested by Pakistan, the climate action framework was not discussed.
Fourthly, China and Russia failed to commit needed financing of institutions because of their own economic weaknesses.
Fifthly, Russia’s Ukraine actions were not condemned by members. Only Turkey’s President Erdogan urged Putin to return occupied territory to Ukraine.
Sixthly, there was leadership failure. For Putin, the summit was a chance to show that Russia was not isolated. For Xi, it was an opportunity to shore up his credentials as a global political leader. Both failed.
Lastly, the summit did not focus on regional challenges: war in Ukraine; the rippling impact of rising regional food prices; the energy crisis roiling economies; and the climate emergency in Pakistan.
Today, SCO is not suitable for China to push any world order. As a multilateral organization, it is much weaker than the EU or ASEAN. Fortification of SCO remains a daunting challenge.