Myanmar’s a hotbed of Big Power rivalry. India can’t afford a hands-off policy there

In the neighbouring Chin State, the army retains control of the provincial capital of Hakha and the smaller town of Thantlang, having lost key townships like Falam and Tedim during "Mission Jerusalem" launched by the Chin rebel groups.

The Arakan Army controls the crucial river-road junction town of Paletwa in Chin state.

Rare Earth Mines Fall to Rebels

The powerful Kachin Independence Army (KIA) has overrun the towns of Pangwa and Chipwe, which straddle the country's biggest deposit of crucial rare earths. 

China, which has a near monopoly over the global rare earth supply chains, imports almost half of its total supplies from Myanmar, mostly from the Kachin state. 

The KIA closed down the supply after throwing out the Burmese army from Chipwe and Pangwa. That led to panic among Chinese rare earth companies, who lost much value in stock markets.

Chinese imports of rare earths from Myanmar dropped by 90 percent between October 2024 and March this year, according to a Reuters report citing Chinese customs data.

But the gates were later opened by KIA when China stopped pushing the rebel group for ceasefire. After all, the KIA needs revenues to run its parellel administration over areas of Kachin state already under its control.

Unnerved by the developments in Kachin state, Chinese companies have now started exploiting newly-identified rare earth mines in the Shan State between the towns of Mong Hsat and Mong Yun, about 200 kms from the Chinese border. Here, the Chinese companies enjoy the protection of the United Wa State Army (UWSA), Myanmar’s strongest ethnic rebel group almost entirely armed by the Chinese. 

Geologists say these are the most substantial rare earth deposits outside the Kachin state. No wonder, Beijing is keen to exploit them without any delay. In the UWSA, it has a reliable ally. The Wa tribe provided most of the foot soldiers for the now-defunct Burmese Communist Party which was backed by China until it folded up in the late 1980s.

Beijing has continued to arm and equip the UWSA as part of its policy to cultivate both the Burmese military and also key ethnic rebel groups on its borders.

Chinese Push MNDAA, TNLA

Chinese intervention in the Shan State has not been limited to rare earth mining.

After the Kokang rebel group MNDAA captured the strategic township of Lashio, Chinese intelligence reportedly abducted the rebel chief Peng Daxun to push him to announce a ceasefire. Lashio was the Northeastern regional command headquarters of the Burmese army. Finally Daxun was released but only after the MNDAA agreed to hand back Lashio to the military junta.

Burmese media reports suggests that Beijing is mounting similar pressure on MNDAA'S ally in the Three Brotherhood Alliance, the Ta’ang National Liberation Army (TNLA) to hand back the towns of Hsipaw and Kyaukme to the military junta.

The KIA and the Arakan Army, the third constituent of the Three Brotherhood Alliance, are under similar Chinese pressure to stop fighting and declare a ceasefire. The two rebel groups, among the strongest in Myanmar’s conflict landscape, have so far resisted Chinese pressures.

In Kyaukphyu, locals allege Chinese security guards protecting a Beijing-funded refinery and an oil-gas pipeline there have been helping Burmese troops in flying combat drones. In February this year, the Myanmar military junta passed a law allowing Chinese companies to bring in their own security personnel and deploy them to guard their establishments. Most of these security personnel are said to be former soldiers. Whether these security personnel will be withdrawn by sea if Kyaukphyu looks like falling or whether they will remain behind is anybody's guess. There are reports that many Chinese managers and technicians have already fled.

Challenges for India

India has so far maintained a wait-and-watch policy on Myanmar, leaving it to the ASEAN to find a way out of the Myanmar conflict with its Five-Point Consensus. That has not worked for a wide variety of reasons and left the field open for a sharp increase of China’s interventionist footprint. Belated US interest in operationalising the Rakhine Corridor from Bangladesh , possibly to supply rebel groups against the China-backed Burmese military junta, brings the spectre of Big Power conflict to one of India's sensitive border regions.

India is now left with no choice but to find a way to deal with armed rebel groups like the Arakan Army , the KIA or the Chin rebel groups , because they are in control of much of their provinces that border on India's Northeast.  Somewhat like the Chinese dual policy of dealing both with the military junta and the armed rebel groups.  It is important to protect and operationalise connectivity projects like the Kaladan Multimodal Transport project India and the Golden Trilateral Highway connecting Northeast India to Thailand via Myanmar, which are crucial to Delhi's ' Act East' policy. Lack of effective presence and influence in Myanmar may lead to unsettling impact in our sensitive Northeastern states. 

Just fencing a long difficult border may not be good enough.

(Subir Bhaumik is a former BBC and Reuters correspondent and author on India's Northeast and its neighbourhood. He has also worked as Senior Editor in Myanmar’s Mizzima Media.)

Views are personal and do not represent the stand of this publication.