Indian Council of World Affairs

Abstract: This paper explains how China’s diplomatic and strategic limitations in the larger Arab world have been revealed following the Iran-Israel war. 

The ongoing Israel-Gaza conflict with the ripple effect across borders suddenly moved beyond the scope of a conventional conflict after Israel attacked Iran, which fuelled the fear of an all-out regional war. On 13 June 2025, Israel launched its military operation “Rising Lion” against Iran to achieve its decades-old objective of dismantling Iran’s nuclear program. Israeli forces targeted Iran’s three nuclear sites (Isfahan, Natanz and Fordow) and missile manufacturing facilities that continue to put the two countries on the brink of a full-blown military confrontation which has bene suspected for almost two decades. 

In the early round of Israeli strikes, top leadership of the Iranian military establishment and dozens of nuclear scientists were killed. Iran’s retaliatory actions caused significant damage inside Israel, including hospitals and public places. Though in the past too, both have confronted each other militarily, and the last round was witnessed in April 2024, when Hamas leader Ismael Haniya was killed in a covert military operation by Israel in Tehran following which Iran carried out a drone attacks on Israel and Israel carried out limited strikes on Iran. 

The 13 June Israeli strikes under the pretext of pre-emptive action incited a new level of fear which many believed could turn into a new abyss, but it ended after both sides agreed to a ceasefire, and a war, which the US President Trump called the “Twelve-day War”[i] came to an end on 24 June 2025. The news of the ceasefire by President Trump was a great source of relief for the international community, which is bearing the brunt of already two major wars (Gaza and Ukraine). 

Amidst the full-blown military strikes between the two, what created a new probability of expanded war was the US’ bombardment of Iranian nuclear sites on 22 June 2025. Iran, perhaps to ease the street pressure and show its strategic righteousness and military capability, responded by targeting the US’ bases in Iraq, Qatar and Bahrain, but no significant damage was reported. Many claim that it was a pre-negotiated retaliatory move on the part of Iran, and the US’ non-action and Trump’s recent statement in this regard perhaps proves the claims right. Though one can consider the action a symbolic one, it also implies that Iran would not hesitate to drag the region into a full-blown war if its security is threatened. Soon after the Iran-Israel escalation and the US’ bombing, the regional and global media were rife with speculations of possible involvement of both Russia and China on the side of Iran, as both, over the years, have invested heavily in terms of geopolitics and strategy to alter the decades-old geopolitical edifice of the region dominated by the US and its allies. 

Russia has already shown its strategic and diplomatic resurrection by intervening in Syria (2015) at the behest of President Assad which helped him survive for a decade until he was removed in December 2024. Over the years, China, too, has made a deep inroad into the larger Arab world through its BRI and other economic and political initiatives, and in 2021, China signed a US $420 billion investment deal with Iran. Because of the growing engagement of China in the Arab world, particularly the growing proximity between Iran and China since the Arab Uprising, many were expecting that China would enter militarily on the side of Iran or provide military assistance. But others were fearful that any military intervention on the part of a third country could mark the beginning of a new version of a global war, but China adhered to its conventional policy of ‘active neutrality’. However, this policy of ‘active neutrality’ revealed the limitations of Chinese military and diplomacy in regional politics despite the exponential augmentation in its economic engagement with the region. 

China’s Stake in the Region  

Amidst the Israel-Iran war, the biggest worry for China was to protect its economic interests and not let the escalation disrupt the flow of oil from the region. For China, any continuation or expansion of the conflict could have negative repercussions for its energy security and the stability of the global market, given its reliance not only on the oil from the region alone but Iran as well. Iran exports 90% of its oil to China despite sanctions, and according to the Wall Street Journal report, Iran exported 1.7 barrels of crude oil per day in the first month of 2024.[ii] The overall Arab world accounts for around 50-60% of total Chinese oil imports.[iii] There are already reports that Israeli air strikes also targeted Iranian energy infrastructure such as gas processing facilities.[iv]

The Israel-Iran war also created a “Hormuz Dilemma” for China because Iran has often threatened to close the Strait of Hormuz in case of any major military actions against Iran. Around 45% of Chinese oil imports pass through the Strait of Hormuz.[v] Chinese apprehensions proved true when on 22 June 2025, the Iranian Majlis (Parliament) passed a resolution calling for the closure of the Strait of Hormuz and referred the matter to the National Security Council of Iran for the final decision.[vi] Iran’s continuous threat to close the Strait of Hormuz has almost made China a hostage to Iran for its oil imports, which is similar to the Malacca Dilemma, whose control by the US continues to threaten China as 80% of Chinese oil imports pass through the Malacca Strait.[vii] Soon after the announcement of a ceasefire by President Trump, China’s official statement mentioned that it does not want to escalate the tensions and hopes for the implementation of the ceasefire as soon as possible.[viii] Though China’s business and trade largely remained unaffected amidst this war, in case of any closure or further escalation, its economic interest would have suffered and exposed its diplomatic and strategic feebleness. 

One should also remember that China’s ambitious BRI runs through the region, and China cannot afford a prolonged conflict, which might scuttle its ambition to emerge as a global economic empire or deter its economic drive. After the debacle in Syria, any chaos in Iran could have been a major blow for China because both China and Iran, over the years, have deepened their ties. The sanctions against Iran also incur additional expenditure for China, as it needs to pay a higher fee for shipping and insurance, and any new sanctions or escalations would harm China further in multiple ways. For China, Iran also represents a source of influence for its exhortation of multilateralism and promotion of voices from the Global South. 

China’s Visible Lack of Influence in the Region 

Anyone who has followed the recent Iran-Israel conflict and subsequent diplomatic and strategic stances from different actors would concur that China’s stance did not move beyond conventional official pronouncements calling for peace, dialogue and stability. The overall policy pursued by China was reflective of its limited role in influencing the politics of the region. The Iran-Israel war has significantly undermined the decade-long Chinese diplomatic efforts to project itself as an alternative model for the US-dominated region. 

For more than a decade, there has been a dominant view that China is emerging as a major political and strategic player in the region, and there seemed some truth in it when it had mediated a peace deal between Iran and Saudi Arabia (2023) and hosted different political factions from Palestine as a part of unity efforts, which eventually led to the Beijing Declaration.[ix]

But this time, China failed to offer itself as a mediator because it believed it lacked the political or strategic leverage to influence Israel[x] unlike in the case of Saudi Arabia and Iran. Perhaps China was not keen to unmask its military strength or put its strategic leverage in the service of Iran, whose vulnerability or fragility was already known. China was also fearful of losing the diplomatic standing it had made in the region over the years by overstretching itself and so remained neutral. It, instead, adhered to the conventional call for de-escalation[xi] and an early end to the war. China never wanted a direct intervention in the region, as its core objective in the region has been to protect its economic interests and not allow disruption in its oil flow. China always tries to protect its vital interests without entering into a direct confrontation with the US.

A day after Israeli attacks, Wang Yi, the Foreign Minister of China, called his Iranian counterpart, Abbas Araghchi, and condemned the attack.[xii] But he called his Israeli counterpart, Gedion too and stated that China has always advocated for a resolution through peaceful means.[xiii] Wang Yi refrained from using harsh language either against Iran or Israel or directly holding any of them responsible for the crisis, which was indication of  its  active neutrality.[xiv] During the emergency session of the UNSC on June 20 , Fu Kang, China’s Ambassador to the UN, , accused the US of the current crises, and the withdrawal of the US from the JCPOA in 2018 was, according to him,  equally responsible.[xv] According to him, the US’ attacks were a violation of international law and a threat to the global non-proliferation regime. China also welcomed the joint statement endorsed by 21 Arab countries on 17 June 2025, calling for regional de-escalation, nuclear disarmament without selectivity and respect for international law. The call had come at the behest of the foreign minister of Egypt.[xvi]

While President Xi Jinping, on his part, merely talked of playing a constructive role but did not offer any sort of mediation.[xvii] In his telephonic conversation with Russian President on 19 June 2025, Xi Jinping offered a four-point proposal, which included an immediate ceasefire, but it was devoid of any condemnation of Israel or Iran. He called for stopping the use of force, particularly from the Israeli side, and protection of civilians and added that international law cannot be hostage to negotiation or exceptionalism.[xviii]

While on the role of the US, China was quite vocal, and its official statement accused the US of pouring oil on fire by supporting Israel and said it is ready to work with the international community for peace and stability.[xix] China also warned the US following the statement of Trump, saying “the US can trace Ayatollah Khamenei, but they would not target him, and he is safe now”.[xx]

China’s stance was laden with measures, which were quite calm and non-reactionary. China took a position that was neither neutral nor biased towards any one. This is active neutrality, which has been the hallmark of its foreign policy in the region.[xxi]

China maintained a position of active neutrality, calculated diplomacy, and active non-intervention[xxii] throughout the war. This approach was driven by its desire to preserve its diplomatic gains, it had achieved over one decade in the region by openly siding with Iran or confronting Israel, as many of the countries within the region itself have not resorted to any stern measures or any unusual diplomatic move. In 2021, China signed a huge economic deal with Iran worth $420 billion, stipulating investment for the next 25 years in various sectors, including military and security. Similarly, China’s engagement with Israel in recent years has also deepened, and the former has invested heavily in various Israeli ports, while latter’s technology in the fields of artificial intelligence, cybersecurity and smart agriculture has been the major attraction for China.  

China also lacks the military will and potential to confront other powers or project itself in a way which could change the course of the event.[xxiii] It also does not want to be drawn into a conflict that is far from its military bases. Meanwhile it lacks decisive influence in the region and military resolve, like the US, to confront its adversaries. Although China prefers to avoid antagonising the US, it consistently aspires to co-share the global political stage with the US and be a pivotal player in the evolving global order. By pursuing the policy of neutrality, China aimed to balance its influence in the region between the US, Israel and the Gulf countries. Today, China maintains strong strategic ties with Israel and several of Iran’s adversaries in the region as well.

China’s adherence to its old version of foreign policy also proves that its mediatory model could not succeed in a region which has been witnessing multiple conflicts for decades. The model applied to bring two traditional rivals (Iran and Saudi Arabia) closer was unlikely to succeed here because the nature, intensity and trajectory of the Iran-Israel conflict are different from other global conflicts. The recent Iran-Israel war has shown that China has a fundamental limitation and lacks the ability to project power and cannot be the key player in the traditional security sense.[xxiv] It also does not seem to have any appetite for any military involvement, which offers less and costs more.

Notwithstanding Iran’s economic ties with China, it could not have pushed the latter for mediation or exerted pressure on the US or Israel because China continues to be a major destination for its oil exports, which helps Iran to put in place its tottering economy, which is badly hit by multiple sanctions for decades. In a given situation, Iran for China does not seem to be more than a tool to counter the US’ hegemony or a counterbalance to the expansionist designs of Türkiye and other countries. It has always called for reviving the nuclear negotiations, and amidst the last round of US-Iran nuclear negotiations, Iran’s Foreign Minister travelled to China as well but failed to persuade China against its conventional policy.

China’s strategic silence amid this 12-day war in a way proved to be a boon when President Trump stated that China could continue its oil trade with Iran, but he also urged China to buy the US’ oil as well.[xxv] Trump’s statement came a day after he ordered the bombing of three Iranian nuclear sites. The statement of Trump is also being seen as Trump’s attempt to woo China to persuade Iran against any action on the closure of the Strait of Hormuz.

Conclusion

The Iran-Israel war has exposed one thing: China still has a long way to go if it has any desire either to replace the US or play any dominant role in the region of West Asia. The role of China, no doubt, has expanded and deepened in the region, but it is still anchored in its geoeconomic rather than any militaristic or political ambition to confront the US or diminish its stature in the regional geopolitics. The Israel-Iran war has demonstrated one major fact: the interests of the regional countries are aligned with the Chinese economic rise, and China is welcome in the region for the diversification of the regional economy, but as far as security and geopolitics of the region are concerned, the US, Russia, and other European nations are more reliable partners and will continue to be so for years to come.

Meanwhile, the Iran-Israel war has, no doubt, exposed the limitations of China’s role in the region, and its position in the region has declined significantly. This is particularly true for those who had a belief that the enhancement of China’s economic role would equally enhance its military and strategic relevance, but China either failed to capitalise on its economic ties or wilfully refrained from overstretching itself in a conflictual region like West Asia. It can also be argued that China, like the US and other states in the region, does not have any military alliance or defence pact with Iran, which could have induced China to take some level of military action despite its huge economic interest in the region. Perhaps China has this realisation that a region marked by oil wealth, persistent tension and strong US influence is not an arena to involve itself beyond trade and commerce and protection of its economic interests.

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*Dr. Fazzur Rahman Siddiqui, Sr. Research Fellow, Indian Council of World Affairs, New Delhi.
Disclaimer: The views expressed are personal.

Endnotes

[i] Official end to 12-day war: Donald Trump declares ceasefire, Business Today, June 24, 2025, Accessed, https://l1nq.com/AgCzk July 1, 2025.

[ii] The Imit of Russia-China Role in Iran-Israel Conflict, Al-Qahera News (Arabic) June 22, 2025, Accessed  https://encr.pw/WxU9B June 24, 2025.

[iii]What worries China maid Iran-Israel escalation, News 24 (Arabic), June 24, 2025, Accessed   https://encr.pw/tz1hP July 3, 2025.

[iv] Ned Garvey, A Strategic Partnership, Not a Military Alliance: Russia’s Role in Israel-Iran Conflicts, The Moocow Times, June 16, 2025, accessed https://l1nq.com/M24B6 July 4, 2025.

[v] An Impossibles Choice: Will China Join Israel-Iran War, Newsroom, June 20, 2025, accessed https://newsroom.info/87102 June 30, 2025.

[vi] Ahmed Aboudouh, The Israel-Iran Ceasefire a Relief for China: But the War Exposes Beijing’s Lacks of Leverage, Chatham House, June 30, 2015, accessed https://l1nq.com/0gC6P June 30, 2025.

[vii] Ahmed Aboudouh, The Israel-Iran Ceasefire a Relief for China: But the War Exposes Beijing’s Lacks of Leverage, Chatham House, June 30, 2015, accessed https://l1nq.com/0gC6P June 30, 2025.

[viii] What worries China maid Iran-Israel escalation, News 24 (Arabic), June 24, 2025, Accessed   https://encr.pw/tz1hP July 3, 2025.

[ix] The four-point proposal injects stabilising force in the Middle East, Global Times Editorial, June 20, 2025, Accessed https://encr.pw/etQNu July 1, 2025.

[x] Ahmed Aboudouh, The Israel-Iran Ceasefire a Relief for China: But the War Exposes Beijing’s Lacks of Leverage, Chatham House, June 30, 2015, Accessed https://l1nq.com/0gC6P June 30, 2025

[xi] IRGC, 50 Mossad Agents arrested, Asharq Al Awsat (Arabic), July 1 2025, Accessed https://l1nq.com/4uPnp July 2, 2025. 

[xii] Wang Yi has phone call with Israeli Foreign Minister, Ministry of Foreign Affairs, People’s Republic of China, June 14, 2025, Accessed https://encr.pw/sifKf July 20, 2025.

[xiii] Wang Yi has phone call with Iranian Foreign Minister, Abbas Araghchi, Ministry of Foreign Affairs, People’s Republic of China, June 14, 2025, Accessed https://l1nq.com/1VG0R July 2, 2025.

[xiv]Warf Qamiha, China between Iran and Isarel: Dragon’s Calm in the Age of Missile, Strategic File (Arabic) June 26 2025, Accessed https://encr.pw/vvZq7 June 27, 2025. 

[xv] Warif Qameehah, China, Iran, and Israel: Balancing Game in Changing East, Asharq Al Awsat (Arabic), June 28, 2025, accessed https://encr.pw/C3cU5 July 4, 2025.   

[xvi]Warf Qamiha, China between Iran and Isarel: Dragon’s Calm in the Age of Missile, Strategic File (Arabic) June 26, 2025, Accessed https://encr.pw/vvZq7 June 27, 2025.

[xvii] Ahmed Aboudouh, The Israel-Iran Ceasefire a Relief for China: But the War Exposes Beijing’s Lacks of Leverage, Chatham House, June 30, 2015, Accessed https://l1nq.com/0gC6P June 30, 2025

[xviii] Warif Qameehah, China, Iran, and Israel: Balancing Game in Changing East, Asharq Al Awsat (Arabic), June 28, 2025, accessed https://encr.pw/C3cU5 July 4, 2025.

[xix] What worries China maid Iran-Israel escalation, News 24 (Arabic), June 24, 2025, Accessed   https://encr.pw/tz1hP July 3, 2025.

[xx] China Enters the Iran-Israel Conflict, Turkiya Aajil (Arabic), June 19, 2025, accessed https://encr.pw/Qyy7U June 30, 2025.

[xxi] Warif Qameehah, China, Iran, and Israel: Balancing Game in Changing East, Asharq Al Awsat (Arabic), June 28, 2025, Accessed https://encr.pw/C3cU5 July 4, 2025.

[xxii] Dr. Fatin Al-Dousri, China and Iran-Israel War, Al-Sharq (Arabic), June 29, 2025, accessed https://l1nq.com/JpJ4L July 1, 2025.

[xxiii]What worries China maid Iran-Israel escalation, News 24 (Arabic), June 24, 2025, Accessed   https://encr.pw/tz1hP July 3, 2025. 

[xxiv] Iran-Israel Conflict: China has no Appetite to be Involved, DW, June 17, 2025, Accessed https://l1nq.com/zrI26 July 1, 2025.

[xxv] Trump says China can but Iranian oil but urges it to purchase US crude, Reuter, June 25, 2025, Accessed https://l1nq.com/5JBl0 July 1, 2025.