ECONOMIC POWER, POLITICAL REALITIES: THE LIMITS OF CHINA’S STATECRAFT IN SRI LANKA AND INDIA
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Authors
Laff, Katherine B.
Subjects
China
economic statecraft
South Asia
India
Sri Lanka
coercion
Hambantota
economic statecraft
South Asia
India
Sri Lanka
coercion
Hambantota
Advisors
Chatterjee, Anshu N.
Twomey, Christopher P.
Date of Issue
2025-03
Date
Publisher
Monterey, CA; Naval Postgraduate School
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Abstract
Is China’s economic statecraft in South Asia effective? The research here examines China’s activities through case studies of India and Sri Lanka. I argue that China’s objectives, their implementation, and outcomes in the two cases, challenge prevailing assumptions about the effectiveness of its economic tools of influence. The framework of coercion, inducement, persuasion, informality, and unintentionality are utilized to evaluate the implementation of China’s economic influence and the limitations encountered in different economic and political environments in South Asia. The case of Sri Lanka is studied through China’s activities at the Hambantota Port, revealing how the exercise of state agency and domestic political interests shaped outcomes, challenging the “debt-trap” narrative. The study of China’s investments in India demonstrated how China’s tools of influence have failed to translate economic dependencies into strategic leverage in support of China's regional objectives. Overall, both cases reveal that China’s economic statecraft is limited, not always producing intended outcomes. These findings represent a clearer picture of the nature of China’s influence in South Asia, including the limits of its economic tools to offer policymakers insights to develop alternative strategies.
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Thesis
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Distribution Statement
Distribution Statement A. Approved for public release: Distribution is unlimited.
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This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.