China’s Rise and (Under?) Balancing in the Indo-Pacific: Putting Realist Theory to the Test


Editor’s Note: This is the fifth installment in a special series published in collaboration with the Raisina Dialogue, which kicks off on Jan. 8 in New Delhi. 

It is adapted from the author’s latest edited volume, Asia’s Quest for Balance: China’s Rise and Balancing in the Indo-Pacific.

Nation-states are constantly engaging in balancing acts: striving to weigh between interests and values; guns and butter; economic gain and national security. Today, however, one balancing act supersedes all others: balancing in response to the rise of China.

Balancing is one of the oldest and most intuitive concepts in international relations theory. The influential realist school counsels that a nation’s rapid accumulation of power has historically proven disruptive, confronting neighbors and peers with an unpalatable choice: bandwagon with the potential threat by aligning with it, or increase their defenses against aggression or coercion through balancing.

Much as the target of schoolyard bullying might enroll in self-defense classes or forge a pact with other victimized classmates, threatened states often seek to enhance their military capabilities — internal balancing — and/or increase security cooperation with like-minded peers — external balancing. Bandwagoning, by contrast, is a riskier proposition. There’s no guarantee the benevolent disposition of a powerful country today won’t turn more ominous tomorrow. And there is no higher authority to guarantee one’s security if the rising power turns aggressive.

Realists believe that, as inherently insecure, competitive entities, states nearly always prefer balancing. For leading realist scholar John Mearsheimer, today is no different. China’s neighbors “are certain to fear its rise” and “will do whatever they can to prevent it from achieving regional hegemony,” including joining “an American-led balancing coalition to check China’s rise.”

Has China, with the more assertive trajectory it has charted over the past decade, prompted a wave of Asian balancing? As it turns out, the relevant question isn’t if China’s neighbors and peers are balancing — many have been for decades or centuries — but, rather, why they’re balancing, how they’re balancing, how much they’re balancing, and what they are balancing toward. In short, there is ample evidence of uneven but elevated balancing activity regionwide, yet it also appears the Indo-Pacific is witnessing a strong current of “under-balancing.”

Most of China’s neighbors and peers are struggling to remain as diplomatically and economically engaged as possible with the rising Asian power while taking the minimum steps necessary to preserve their security and sovereignty. Many, including the member states of the Association of Southeast Asian Nations (ASEAN), have proven averse to more sophisticated, potent balancing initiatives such as treaty alliances, multilateral military exercises, and joint Freedom of Navigation Operations and naval patrols. None, including the “Quad,” the grouping of Indo-Pacific democracies consisting of Australia, India, Japan, and the United States, has seriously entertained a Cold War-style containment strategy.

On balance, Indo-Pacific balancing has been more diverse and less pronounced than realist theory, past precedent, or strategic logic might suggest. What explains this? Why do countries continue engaging and empowering a country that could one day pose a threat? Why haven’t China’s neighbors joined a U.S.-led balancing coalition, as Mearsheimer predicted? And why haven’t the Quad countries adopted more overt containment strategies?

Some of the contributing factors are structural and related to the changing nature of international governance and the global economy. Others are the product of China’s unique profile as a rising power and the threat perceptions it has (and hasn’t) engendered. Still others reflect the costs, benefits, and incentives facing ASEAN countries and other smaller powers in China’s periphery.

The Balancing Landscape

In three important ways, China’s neighbors are engaging in balancing in line with what realist theory would predict. First, at a macro, regionwide level, there is substantial evidence of accelerated internal and external balancing in the Indo-Pacific. Military spending has been growing faster in Asia than nearly any other region of the world, and the continent now hosts six of the world’s top 10 defense importers, including the global leader: India. Between 2016 and 2020, the littoral states of the South China Sea are expected to increase defense spending by 50 percent, reaching $250 billion, though China is not the only factor driving these trends.

Second, what began a decade ago as tentative steps toward greater defense collaboration among some Chinese neighbors has broken into an open sprint in recent years. The intensity of the activity has differed widely, accelerating more quickly among Japan, Australia, India, and Vietnam than with Malaysia, Indonesia, or Myanmar. In some cases, concerns about China have been an overt or explicit motivation; other times they’re one of several factors motivating the “thickening” of Asian security networks. Either way, there has been material growth in the quality and quantity of defense collaboration and joint military exercises; security-focused bilateral, trilateral, and multilateral dialogues; joint vision statements; and military inter-operability agreements.

Third, traditional military balancing has been accelerating among the Quad. China’s deteriorating bilateral relationships with each member of the group and growing concerns about its challenges to the rules-based order helped spur the revival of the quadrilateral dialogue, which has convened thrice since November 2017 after lying dormant for a decade.

But as notable as the balancing we are seeing is the balancing we are not seeing. For most Indo-Pacific capitals, trade and investment ties with China have grown exponentially in recent years, despite aggravated threat perceptions and security-related concerns. Even among the Quad, diplomatic and economic cooperation with China remains remarkably robust; Beijing is the largest trading partner of all four members.

Some of China’s immediate neighbors, like Cambodia, Laos, and Pakistan, have foregone balancing altogether. Rather than shoring up defenses against Chinese aggression, they’re embracing a larger Chinese economic and, at least in Pakistan’s case, military footprint. ASEAN states, meanwhile, have steered away from hard balancing measures toward more neutral, non-provocative endeavors. They’re seeking to defend their sovereignty and autonomy by strengthening international laws, norms, and institutions, which realists have traditionally dismissed as inconsequential to restraining state behavior and impacting decisions about war and peace.

Under-Balancing in a New World Order

Globalization and the spread of economic interdependence have bound countries of all stripes in a close, sometimes uncomfortably tight economic embrace. This has created a paradox for China’s neighbors and peers. With their economic fortunes so directly tied to healthy relations with Beijing, harder forms of balancing risk invoking China’s ire and threatening their economic prospects. Thus, containment and more extreme forms of balancing that limit engagement have become less palatable and more costly.

During the Cold War, the containment strategy America and its partners employed toward the Soviet Union succeeded in large part because there was no meaningful economic relationship between the superpowers. Ashley Tellis persuasively argues the same strategy employed against China would “find little traction with key Asian states” and be “doomed to failure — at least for now.” He suggests that severing ties with China is “politically, economically, and practically unthinkable” in a globalized world, leaving China free to “exploit interdependence to increase [its] power and autonomy.”

While globalization has indeed disincentivized balancing and limited the effectiveness and attractiveness of containment, the emergence of an international order in the latter half of the 20th century created new avenues for balancing. Alongside more traditional military balancing strategies, Indo-Pacific countries are increasingly channeling their energy toward what some scholars have dubbed “institutional balancing.”

Kai He defines institutional balancing as a strategy in which states “practice norm/rule-building to constrain other states’ behavior or control and manipulate agendas to address issues related to their interests in multilateral institutions” and “consolidate their political and economic unity to resist pressures from outsiders.” He identifies a direct and positive correlation between the spread of economic interdependence and the attractiveness of institutional balancing vis-à-vis more traditional forms of military balancing.

The phenomenon has manifested most directly in the growing attention being accorded to promoting the rules-based order and, more recently, the “Free and Open Indo-Pacific.” Leaders from the Quad, ASEAN, and beyond have been more vocal in supporting the underlying tenets of the regional order, including freedom of navigation, peaceful dispute settlement, support for international law and the UN Convention on the Law of the Sea, and, more recently, infrastructure that is transparent, high-quality, and financially sustainable.

This shift represents an effort to adapt balancing to a changing world and to a new breed of rising power. To date, the Indo-Pacific rivalries of the 21st century have unfolded not via broadsides from battleships but in the coercive “grey zones” and the court of public opinion. Today, securing votes at international tribunals or pledges of support for freedom of navigation may be equally as important to smaller Asian states as acquiring new submarines or cruise missiles.

As a result, many Indo-Pacific capitals are increasingly devoting their energy not toward “containing” China but toward constraining its capacity to infringe on their interests and undermine the rules-based order. They’re seeking to craft, enhance, and defend norms, laws, institutions, and principles that constrain China’s most aggressive impulses and its capacity for misbehavior.

Skeptics have rightly questioned the degree to which such means can shape China’s behavior. To date, the evidence is mixed. On one hand, China’s leadership has proven sensitive to reputational costs and devoted energy and capital toward cultivating an image of a peaceful, responsible, benevolent power. President Xi Jinping has increasingly sought to portray China as a leader and guardian of the global economic and political order. In his Jan. 1, 2018, New Year’s address, he pledged that Beijing would “always be a builder of world peace, contributor of global development and keeper of international order.” In 2016 China’s leaders dismissed a Philippines-initiated Arbitral Tribunal as illegitimate and unworthy of their participation, yet waged a concerted campaign to rally international support when it ruled decisively against them. Finally, Beijing has spared no effort trying to prevent ASEAN from forming a consensus in opposition to its South China Sea activities — not because it fears the group’s combined military might, but because it hopes to avoid being portrayed as a pariah acting against the regional consensus.

On the other hand, Beijing freely disregards laws, norms, and international opinion when it suits the Communist Party’s interests. And it’s only growing more brazen in doing so. This suggests institutional balancing will serve as neither an effective deterrent nor a complete substitute for conventional defense spending and coalition-building, which is why the Quad and others continue to advance more traditional forms of military balancing alongside this new focus on the rules-based order.

Nature of the Beast

While Beijing has grown objectively more assertive across a range of foreign policy fault lines, the geographic scope of its territorial claims remains limited and relatively well-defined, even if the claims themselves are intentionally ambiguous and in flagrant violation of international law.

For now, China’s neighbors are alarmed by its designs on contested territory high in the Himalayas and deep in the sea. But, with the possible exception of Taiwan, those neighbors don’t fear the prospect of armored Chinese columns threatening their capitals or Chinese-funded insurgencies launching a guerilla war. They believe China poses a threat to their interests, autonomy, and the rules-based order, but not to their existence. Indeed, the history of contemporary Chinese warfare is largely characterized by limited, short-term conflicts and stealthy “grey-zone” coercion designed to either induce submission or “reclaim” lost territory.

Where the Soviet Union traded in radical revolutionaries, puppet regimes, and brute military force, China is wielding subtler elements of power and influence in pursuit of loyalty, submission, and arrearage. For China, “strategic predominance means a return to the Middle Kingdom where regional states paid due respect to China’s interests and were careful not to act in any way that displeased China,” argues Peter Varghese, former secretary of Australia’s Department of Foreign Affairs and Trade.

Of course, even in pursuit of these more limited ambitions, China has repeatedly and brazenly infringed on the interests of its neighbors. Yet, there is a widely held belief, among ASEAN capitals at least, that China’s leadership remains cautious, risk-averse, and deliberative in its decision-making. For the time being, these countries say, China is disinclined toward any large-scale kinetic conflict, particularly one involving the United States.

This is why, despite the fact most regional security analysts would identify China as their nation’s principal conventional security challenge, the depth of regionwide threat perceptions does not necessarily match their breadth. China’s neighbors are balancing less to ensure their survival than to preserve their autonomy and a rules-based order, which is resulting in less determined forms of balancing.

ASEAN’s Hedging

Several contributing authors to my new edited volume Asia’s Quest for Balance argue that ASEAN states like Indonesia, Malaysia, and others are more likely to perceive Chinese assertiveness as a “challenge” than as a “threat,” and to place greater faith in the power of diplomacy or multilateral norms and institutions to dissuade Chinese adventurism. These countries are also more likely to perceive hard balancing strategies as counterproductive, pushing Beijing toward even more unfavorable or aggressive responses.

Many contributors noted the role of ASEAN countries’ strategic and diplomatic culture in their approach to balancing, in particular, an ingrained aversion to geopolitical alignment and military alliances, as well as anxiety about becoming embroiled in great-power rivalry. For many ASEAN capitals, encouraging the Quad to assume more active and consistent roles in regional

security and economic affairs is a less provocative way to achieve a relative balance of power than proactively trying to limit or diminish China’s power and influence.

In the years ahead, Southeast Asian countries will continue taking modest steps to strengthen their military capabilities and forge new external security partnerships but will feel constrained by geographic realities and economic imperatives. Some, like Vietnam, may pursue more independent foreign policies and more vigorous balancing initiatives, drawing closer to the Quad. But absent a major provocation from China that fundamentally alters regionwide threat perceptions, these countries are likely to remain relatively aloof, reflecting the disposition of their broader publics: surprisingly unaware of or disinterested in the geopolitical “Great Game” underway.


The Indo-Pacific balancing landscape is colored by a changing, more economically interdependent world, the lure of profitable engagement with Beijing, and the subdued threat perceptions of many of China’s neighbors. Along with China’s effective deployment of carrots and sticks, these factors have created disincentives to more traditional military coalition-building and to containment strategies of eras past, replaced by “softer” forms of balancing and institution-building. In short, China has defied realist theory’s expectations about balancing — so far.

Beijing may want to temper its enthusiasm, though. Its more assertive disposition has already set one consequential wave of military balancing into motion among the Quad, whose cumulative power and geopolitical heft far outstrip China’s smaller, more quiescent neighbors. Even if, as its critics suggest, the Quad is moving at an overly deliberative pace, the institutional framework for quadrilateral cooperation has been established and can be scaled up quickly in response to future threats. Critically, all four countries have been advancing defense collaboration at the bilateral and trilateral levels in much quicker but quieter strides.

There’s more bad news for China. A second backlash wave has begun forming in response to longstanding but hardening concerns over a wide variety of Chinese economic and foreign policy practices. Notably, it extends beyond the Quad to the European Union, Southeast Asia, and parts of the developing world.

This wave is partly propelled by growing concerns about China’s expansive Belt and Road Initiative. Over the past year, the international narrative surrounding the project has become much more suspicious and hostile. Last month, the European Union, India, and the United States worked to scrub any praise of the Belt and Road from a United Nations resolution on Afghanistan.

Across the globe, there’s been greater scrutiny applied to Chinese investments in sensitive infrastructure, the nexus between economics and geopolitics in Chinese grand strategy, and the secretive nature of the deals China is signing, which at times are later found to have contained objectionable or sovereignty-violating provisions. These concerns predate the Belt and Road, but as the initiative has amplified China’s footprint abroad, the backlash has sharpened.

In parallel, there’s rising alarm over China’s increasingly brazen use of “sharp power,” its interference in the domestic politics of its neighbors, its crackdown on academic freedom, its increasingly repressive approach to freedom of religion and human rights at home, and its punitive bullying tactics abroad. Trends in each arena have deteriorated since the 2008 global financial crisis and even more so since Xi Jinping’s rise to power in 2012. Over the past two years, however, the level of international awareness and alarm has risen as the tolerance for these practices has diminished.

Perhaps nowhere has the center of gravity shifted more decisively than in the United States. Supported by a crystalizing bipartisan consensus, the Trump administration has opened several new fronts against China on economic protectionism, cyber security, and human rights violations. It has issued indictments for Chinese hackers, given the Pentagon more flexibility to conduct freedom of navigation patrols in the South China Sea, unveiled new restrictions on foreign investments, and ordered the detention of the head of a major Chinese telecom firm. The European Union, Australia, and others have begun following suit, unveiling new screening measures on foreign investments and outlawing foreign political donations while more vocally denouncing China’s predatory trading practices and illegal detention of foreign citizens. Nor is this a western phenomenon. From Sri Lanka to Malaysia, and from the Maldives to Kenya, China’s brand, and that of the Belt and Road, are under duress.

To date, this backlash has translated into a more concerted effort to limit or scrutinize engagement with Beijing, as opposed to producing the more cohesive and widespread military balancing that realist theory might predict. Whether the latter eventually happens will depend very much on China’s actions and how Beijing responds not only to mounting international criticism, but also to more challenging domestic economic conditions. If Beijing doubles down on the more assertive and repressive trajectory it has charted since 2008, it may end up fulfilling the realists’ prophecy and triggering a new tide of balancing after all.


Jeff M. Smith is a Research Fellow in the Heritage Foundation’s Asian Studies Center. He is the author/editor of “Asias Quest for Balance: Chinas Rise and Balancing in the Indo-Pacific” (2018), and author of “Cold Peace: China-India Rivalry in the 21st Century (2014).  His expert commentary has appeared in Foreign Affairs, the Wall Street Journal, the New York Times, and The Economist, among others.

Image: U.S. State Department