Established in 2001, the Shanghai Cooperation Organization (SCO) has evolved into a significant regional organization in Eurasia, attracting increasing attention from both member states and observers worldwide. This backgrounder seeks to offer an in-depth understanding of the SCO’s history, its strategic motives, and the trends that have emerged over time, while also examining its role and relevance in contemporary geopolitics.

Brief History of the Shanghai Cooperation Organization

The SCO was founded by China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan in June 2001. The organization initially emerged from the Shanghai Five, which was formed in 1996 with the aim of demilitarizing the common borders of its members following the disintegration of the Soviet Union. Over time, the organization has grown, incorporating India, Pakistan, and Iran as full members, in addition to multiple observer and dialogue partners like Afghanistan, Belarus, and Mongolia, among others.

A key driving force of the SCO’s growth has been in response to the enlargement of Western institutions like NATO and the EU. The increasing great power competition between the West and countries like China and Russia has driven these nations to establish and enlarge regional platforms like the SCO without requiring a common doctrine that impedes sovereignty.

Strategic Motives of Member States and Observers

The SCO has gained prominence for several reasons, including regional security, economic cooperation, and political coordination. Member states are motivated by various factors, including counterterrorism, regional stability, and economic development.

Changes in China’s leadership have led to shifts in the SCO’s focus and objectives. Chinese President Xi Jinping’s foreign policy emphasizes a more assertive role for China, a departure from the views of his predecessors Hu Jintao and Jiang Zemin. Under Xi’s leadership, China has increasingly leveraged the SCO to expand its influence in the region and expand beyond the original mandate of border security and cooperation.

As one of the founding members, China views the SCO as a tool to enhance regional stability, particularly given its concerns over the potential spillover effects of terrorism and extremism in Xinjiang province. Additionally, the SCO offers China an opportunity to expand its economic influence via its Belt and Road Initiative (BRI) with critical projects that include SCO members. The China-Pakistan Economic Corridor (CPEC), lauded as the BRI’s flagship project, features over $60 billion USD of foreign direct investment to develop energy and transportation infrastructure throughout Pakistan’s southern and western provinces. However, progress and enthusiasm for CPEC has waned since the project was officially greenlit in 2015. Regional insecurity is particularly acute in Balochistan province. As the southernmost component of CPEC, Balochistan hosts Gwadar Port and serves as the primary artery of the corridor’s transportation network. A significant portion of CPEC investment is allocated to projects in coal, hydropower, wind, and solar energy, which are aimed at decreasing China’s reliance on imports from the Malacca Strait, and addressing Pakistan’s chronic energy shortages. The success of these initiatives is crucial for energy diversification and for Pakistan’s economic development and stability, which in turn impacts regional security – a core concern of the SCO.

Moreover, the energy sector plays a key role in the SCO’s broader agenda as a common area of interest and future avenue of growth and development. By resolving regional insecurity and improving coordination between members, the SCO moves closer to connecting its energy-rich members in Central Asia and Iran to lucrative markets in China and South Asia. This prospect, though far from realization, has influenced the intrigue and interest in the SCO from major Gulf energy exporters including Saudi Arabia, Bahrain, Qatar, and the United Arab Emirates.

Incorporating more observer states like Afghanistan, Belarus, and Mongolia presents a strategic opportunity for the SCO to bolster its energy security. Despite its security challenges, Afghanistan’s location makes it an appealing transit hub for future energy projects, offering its government hundreds of millions in potential revenue from transit fees. With the Taliban cementing its control, the long-awaited Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline has seen its interest and support revived, with additional support from full SCO members like Russia and China in bringing the project to fruition. Such conditions demonstrate the SCO’s ability and willingness to exert diplomatic support and pressure for dormant projects, even with participants outside of its membership body.

Russia, for its part, views the SCO as a platform to counterbalance the growing influence of Western-led organizations such as NATO and the EU. By strengthening its ties with regional powers through the SCO, Russia aims to maintain its strategic interests and retain its role as a key player in the region. Economically, the International North-South Transport Corridor (INSTC), a multi-modal transit network designed to move freight between Russia, Azerbaijan, Iran, and India, is expected to make the SCO’s agenda this year. However, Russia’s war in Ukraine serves as a critical test of the SCO’s commitment to member sovereignty and international pressure, with implications that will undoubtedly shape the organization’s future direction, efficacy, appeal, and relevance.

Smaller Central Asian states, such as Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan, are driven by a mix of security and economic interests. The SCO serves as a forum for these countries to address transnational security threats, such as terrorism, drug trafficking, and organized crime. For newer members like India and Pakistan, the SCO offers a platform to engage with regional powers, discuss security challenges, and advance their economic agendas. India also sees the SCO as an avenue to increase its influence in Central Asia, while also counterbalancing China’s growing clout in the region.

SCO In Perspective

The SCO differs from other Chinese-led initiatives, such as the Asian Infrastructure Investment Bank (AIIB) or the BRI, in that it addresses a broader range of issues, including security and political coordination. While the AIIB and BRI primarily focus on infrastructure development and investment, the SCO aims to balance trust, cooperation, and coordination among member states.

In comparison to Western-led organizations such as NATO and the EU, the SCO does not impose a unified set of political norms or values on its members.  Instead, the SCO emphasizes non-interference in internal affairs, mutual respect for sovereignty, and a focus on regional security and stability. Unlike NATO, the SCO lacks a mutual defense pact or centralized military command. This is indicative of the organization’s preference for a more flexible and consensus-based approach to regional issues.

Furthermore, when comparing the SCO to Cold War-era alliances such as the Warsaw Pact and the Non-Aligned Movement, the SCO appears to be more of a hybrid between the two. The SCO shares similarities with the Warsaw Pact in terms of the composition of its membership and its role as a counterweight to Western influence, but it also echoes the Non-Aligned Movement’s emphasis on respecting member sovereignty and discouraging interference in their internal affairs. Given this unique position, the SCO should be viewed as a distinct entity, adapting to the needs and challenges of the current era and membership roster.

Functions and Trends: The Evolution of the SCO

The SCO has expanded its mandate since its inception, encompassing a diverse range of issues within security, economics, cultural exchanges, and political coordination. The organization has implemented several initiatives to address its objectives, demonstrating its evolving focus and priorities.

At its core, the SCO is a security-oriented organization, focused on counterterrorism and regional stability. To combat these challenges, the SCO established the Regional Anti-Terrorist Structure (RATS) in 2004, which facilitates intelligence sharing and joint counter-terrorism operations among member states. SCO members have also conducted numerous joint military exercises, aiming to enhance cooperation and preparedness among its members.

The collective economic and political might of its members notwithstanding, the SCO faces numerous challenges, such as resolving regional border tensions among member states. Ironically, following India and Pakistan’s accession in 2017, border tensions and conflicts have worsened in Kashmir and throughout the Himalayas between India and China. The organization’s loose structure and the absence of shared values and norms severely undermines the SCO’s scope and capacity in resolving regional security issues and maintaining efficiency even as it incorporates additional members.

Conclusion

The Shanghai Cooperation Organization’s relevance in contemporary geopolitics is undeniable. As a regional platform, the SCO has evolved to address the diverse and changing interests of its member states, providing a forum for cooperation without a rigid framework of shared values, or the pre-conditions that undergird accession to NATO or the EU. The SCO serves as a balancing act, enabling its members to navigate complex regional and global power dynamics without compromising their latitude in managing internal affairs.

While it may not possess the same level of institutionalization as its Western counterparts, the SCO’s consensus-based approach and emphasis on national sovereignty have proven successful in maintaining relevance and participation of its member states. As the organization continues to evolve, its significance in shaping the future of Eurasia is likely to grow.