The 22nd Annual Shanghai Cooperation Organisation (SCO) Summit concluded with the adoption of the Samarkand Declaration. The 121-point long Declaration encompassing almost all major issues concerning the world today underlines the growing span of SCO’s horizons. Concurrently, one of the major points noted was the expansion of the Organisation. It is evident in para 58-62 of the Declaration that the Gulf countries dominate the cluster of countries vying for membership as well as dialogue partner status in the grouping.[i]
Iran will attend the 2023 Summit hosted by India as a member country. The SCO members have signed a Memorandum of Understanding (MoU) accepting Iran as a full member of the grouping. Bahrain, Kuwait, the United Arab Emirates (UAE), Saudi Arabia and Qatar are to gain the status of the SCO Dialogue Partners. The Samarkand Summit appreciated the adoption of decisions granting Dialogue Partner status to Bahrain, Kuwait and the UAE. It also noted the signing of the MoU on granting the status of SCO dialogue partner to Saudi Arabia and Qatar. Egypt and Türkiye are two non-Gulf countries of West Asia North Africa (WANA) region that are keen to join the SCO; currently Türkiye is a Dialogue Partner of the SCO while Egypt also signed a MoU to become one.
Figure: Map depicting member countries, observer states, dialogue partners of the SCO and countries from West Asia and North Africa keen to join the grouping.
Expansion of membership
SCO was formed when Shanghai Five constituting Kazakhstan, China, Kyrgyzstan, Russia and Tajikistan extended membership to Uzbekistan in 2001. Since then, there had been speculations of expansion of SCO but there was no consensus until the Organisation agreed to induct India and Pakistan, which became full members in 2017. However, the SCO appreciates the expansion of the Organisation; the Member States confirmed openness for accession by interested States whose goals and aspirations meet the criteria and conditions contained in the normative legal documents of the Organisation. In addition, Afghanistan, Belarus, Iran and Mongolia are observer states while Armenia, Azerbaijan, Cambodia, Nepal, Sri Lanka and Türkiye are dialogue partners.[ii]
Expansion of Focus Area
SCO is also expanding its area of focus since its inception in 2001. Before the formation of SCO, Shanghai Five focused majorly on regional security; it was a political association focusing on confidence-building in the military field and mutual reduction of Armed Forces in the border areas. When Shanghai Five became SCO, the Organisation expanded its mandate to terrorism, separatism and extremism, drug trafficking, multilateral trade and economic cooperation in the region. The SCO Charter mentions regional cooperation in politics, trade, economy, defence, law enforcement, environment protection, culture, science and technology, education, energy, transport, credit and finance, social and cultural development and human rights as goals and tasks of the Organisation.[iii]
Implications of the Expansion
The SCO expansion can have varied implications for the Organisation. As it accepts more members, SCO gains greater legitimacy at regional as well as international forums. Secondly, the new members will bring security and economic benefits for the Member States providing economic heft to the SCO. Thirdly, the Organisation will grow in importance in global politics. Currently, the SCO (without Iran) constitutes 30 per cent of the global GDP and 40 per cent[iv] of the world population.[v]
During the Samarkand Summit, the Member States stressed that the expansion of the SCO and further deepening of cooperation with the Observer States, Dialogue Partners and cooperation with international associations will expand the potential of the Organisation. They also underlined that the expansion will further enhance the role of the SCO in the international arena as a multilateral mechanism for addressing topical contemporary issues, ensuring security, stability and sustainable development in the region.[vi]
Gulf and the SCO
The Gulf countries including Iran and the Gulf Cooperation Council (GCC) countries, with the exception of Oman, are keen to join the SCO. The membership in the Organisation fosters Iran’s closeness to Russia and China while providing an opportunity for strengthening Tehran’s economic and political engagement with Eurasia. Iranian media portrayed the move as an indication of growing proximity between Tehran and Beijing.[vii]The membership also signifies a step consistent with Iran’s “Look East” policy. The SCO membership is significant for the current government in Iran with President Ebrahim Raisi hailing it as one of his government's diplomatic masterstrokes.[viii]Foreign Minister Hossein Amir-Abdollahian announced that Iran entered a new stage of various economic, commercial, transit, energy, etc. cooperation by becoming a member country. On the other hand, the Central Asian countries look at Iran as a potential transit hub and an alternative to dependence on Russia.[ix]
GCC countries perceive archrival Iran’s membership in the Russia-China dominated SCO as a threat and believe that their presence in the Organisation will keep Moscow and Beijing from tilting towards Tehran. Also, the GCC countries look at the SCO as a platform to strengthen ties with Russia as an alternative external force especially as US influence in the region is weaning. In addition, the growing divide between the US and China as evident from the ongoing geo-political and geo-economic competitions, has also led the GCC countries to engage in the balancing act while the GCC economies are pro-actively engaged in economic diversification.
While geo-politics is significant for the Gulf countries to seek SCO membership, economic benefits outweigh the political gains and leverages. The Gulf countries are eying the markets of Central Asia. On September 7, 2022, the GCC Foreign Ministers and their counterparts from Central Asia inaugurated the GCC-Central Asia Strategic Dialogue in Riyadh with the aim to launch cooperation in all areas of mutual interest.[x] Even at the bilateral level, the Gulf countries are expanding their ties with the Central Asia and SCO membership will certainly foster the existing economic relationships.
Iran has strong trade relations with Afghanistan; Tehran’s export to Kabul was worth US$ 2.9 billion in 2018. Iran aims to expand its reach in the Central Asian markets when its economy is suffering due to the sanctions and the chances of a nuclear deal, within or outside the Joint Comprehensive Plan of Action (JCPOA), remains bleak. Iran has established a new drone factory in Tajikistan and has also sought partnerships with Azerbaijan and Turkmenistan.[xi]
Saudi Arabia is considering importing environmentally friendly products from Kyrgyzstan.[xii]Eco Islamic Bank, supported by Saudi Arabia, has more than 120 branches across Kyrgyzstan.[xiii]UAE is investing in Central Asia in order to promote its vision of access and connectivity as part of a global hub-and-spoke system; Dubai-based DP World has acquired two special economic zones in Kazakhstan on the Caspian Sea.[xiv]Qatar Stock Exchange has signed an MoU with the Tajikistan’s Central Asia Stock Exchange project.[xv]
Hydrocarbon rich Gulf countries are also interested in energy partnerships in the Central Asian region and the SCO membership will certainly facilitate such engagements. Iran is looking at enhancing its energy partnerships in the Central Asian region as these countries are vying for alternative sources of energy transit in wake of sanctions imposed on Russian ports. Similarly, the GCC countries also aim to invest in the Central Asian energy market. ACWA Power, a Saudi utility developer, signed US$2.5 billion energy-related investment agreements with Uzbekistan. The UAE has used its leading Sovereign Wealth Fund (SWF) Mubadala to invest in energy and port infrastructure throughout Central Asia.[xvi] Qatar and Kazakhstan have signed a number of MoUs on oil and gas cooperation.
The Gulf region’s increasing interest in SCO portrays their inclination to look towards Asian economies for viable partnerships. It also shows a tendency to forge ties with non-Western actors. There are speculations about SCO being a platform for mending ties between Iran and Saudi Arabia, however, it seems farfetched for now. There is also discussion on whether the SCO is looking for expansion in the Gulf and WANA region to counter the US and Western geo-political and geo-economic influence. However, at this stage, it remains mere speculation. What is notable is that there is greater intent on part of both the SCO and the Gulf countries to develop greater engagement and cooperation.
* Dr. Lakshmi Priya, Research Fellow, Indian Council of World Affairs, New Delhi.
Disclaimer: Views expressed are personal.
[i]Samarkand Declaration of the Council of Heads of State of Shanghai Cooperation Organisation, Ministry of External Affairs, Government of India, September 16, 2022, available at https://mea.gov.in/outoging-visit-detail.htm?35724/Samarkand+Declaration+of+the+Council+of+Heads+of+State+of+Shanghai+Cooperation+Organizationaccessed on September 19, 2022
[ii]Shanghai Cooperation Organisation, Political and Peace Building Affairs, United Nations,available at https://dppa.un.org/en/shanghai-cooperation-organizationaccessed on September 19, 2022
[iii]Charter of the Shanghai Cooperation Organisation, available at https://www.iri.edu.ar/publicaciones_iri/manual/Doc.%20Manual/Listos%20para%20subir/ASIA/SHANGAI-ORG/charter_shanghai_cooperation_organization.pdfaccessed on September 19, 2022
[iv]English Translation of Remarks by Prime Minister, Shri Narendra Modi at the SCO Summit, Ministry of External Affairs, Government of India, September 16, 2022, available at https://mea.gov.in/outoging-visit-detail.htm?35719/English+Translation+of+Remarks+by+Prime+Minister+Shri+Narendra+Modi+at+the+SCO+Summitaccessed on September 19, 2022
[v]After inclusion of interested West Asian countries (Iran, Egypt, Türkiye, Saudi Arabia, UAE, Qatar, Bahrain and Kuwait) the organisation will constitute 34.6 per cent of the global GDP and 43.79 per cent of the world population.The GDP data has been taken from IMF (2022) available at https://www.imf.org/external/datamapper/ngdpd[at]weo/OEMDC/ADVEC/WEOWORLDand the population data has been taken by world population prospects (2019) cited at world population review available at https://worldpopulationreview.com/countries
[vi]Samarkand Declaration of the Council of Heads of State of Shanghai Cooperation Organization, Ministry of External Affairs, Government of India, September 16, 2022, available at https://mea.gov.in/outoging-visit-detail.htm?35724/Samarkand+Declaration+of+the+Council+of+Heads+of+State+of+Shanghai+Cooperation+Organizationaccessed on September 19, 2022
[vii]Aamna Khan, What Does Iran’s Membership in the SCO Mean for the Region?,The Diplomat, September 20, 2022, available at https://thediplomat.com/2022/09/what-does-irans-membership-in-the-sco-mean-for-the-region/accessed on September 21, 2022
[viii]Syed Zafar Mehdi, Iran signs 'memorandum of commitment' for full SCO membership, September 15, 2022, Anadolu Agency, available at https://www.aa.com.tr/en/middle-east/iran-signs-memorandum-of-commitment-for-full-sco-membership/2685515accessed on September 21, 2022
[ix]Nikole Grajewski, Iran One Step Closer to SCO Membership, The Washington Institute for Near East Policy, September 14, 2022,available athttps://www.washingtoninstitute.org/policy-analysis/iran-one-step-closer-sco-membershipaccessed on September 21, 2022
[x] Abdel Aziz Aluwaisheg, Enthusiasm abounds as GCC, Central Asia launch strategic dialogue, Arab News, September 09, 2022, available at https://www.arabnews.com/node/2159106 accessed on September 21, 2022
[xi]Seth J Frantzman, What does Iran’s drive for Central Asia partnerships look like? – analysis, The Jerusalem Post, July 02, 2022,available at https://www.jpost.com/international/article-710999accessed on September 22, 2022
[xii]Saudi Arabia and Kyrgyzstan enhanced economic cooperation and investment opportunities, Special Eurasia, March 23, 2022,available at https://www.specialeurasia.com/2022/03/23/saudi-arabia-kyrgyzstan/accessed on September 22, 2022
[xiii]Saltanat Berdikeeva, Saudi Arabia’s Growing Influence in Central Asia, Inside Arabia, April 10, 2020, available at https://insidearabia.com/saudi-arabias-growing-influence-in-central-asia/accessed on September 22, 2022
[xiv]Theodore Karasik, The United Arab Emirates in Central Asia, Newlines Institute, August 28, 2019, available at https://newlinesinstitute.org/china/the-united-arab-emirates-in-central-asia/accessed on September 22, 2022
[xv]Natalie Koch, Qatar and Central Asia: What’s at Stake in Tajikistan, Turkmenistan, and Kazakhstan?, Ponars Eurasia, September 28, 2017, available at https://www.ponarseurasia.org/qatar-and-central-asia-what-s-at-stake-in-tajikistan-turkmenistan-and-kazakhstan/accessed on September 22, 2022
[xvi]Geopolitics of UAE investments in Central Asia, Special Eurasia, October 18, 2021, available at https://www.specialeurasia.com/2021/10/18/geopolitics-uae-centralasia/accessed on September 22, 2022