This transcript is from a CSIS podcast published on July 23, 2024. Listen to the podcast here.
Jon Alterman: Hasan Alhasan, welcome to Babel.
Hasan Alhasan: Thank you very much.
Jon Alterman: Around the world, there's a war in Ukraine, U.S.-Chinese competition, and a war in Gaza. You're sitting in the Gulf. What does it look like is going on around the world?
Hasan Alhasan: It's a very dangerous world. There is tremendous upheaval, as you describe it. The geopolitical situation in the region looks extremely turbulent, but obviously, it's not much better in Europe at the moment.
Global geoeconomics also look quite turbulent; you've got an ongoing trade war that could get even worse if Trump gets reelected. This can have all kinds of repercussions for the Gulf region, but in addition, there is a tremendous amount of opportunity that Gulf leaders seem to perceive in this changing geopolitical and geoeconomic context. It opens up opportunities for the Gulf states to play various roles that had been closed to them in the past.
For example, you see the Saudis and the Emiratis trying to mediate various prisoner exchanges between the Russians and the Ukrainians. That's not a role that you would normally conceive of for the Gulf states, but there they are. They see this not only as a perilous environment, but also one that offers several opportunities.
Jon Alterman: So how would you differentiate the different approaches of Gulf states? What are the similarities? You mentioned the Saudis and the Emiratis talking about prisoner exchanges, but what are the differences in how Gulf states perceive the world and how they act?
Hasan Alhasan: I tend to think that the similarities are greater than the differences. If you look at the crux of their foreign policies, their threat perceptions, and their national security strategies, I see more similarities than differences. They are all U.S. strategic partners. They rely on the presence of foreign powers, the United States first and foremost, to protect and safeguard their national interests. They perceive Iran to varying degrees as the source of a potential threat. They are open economies. They are oil exporters; they are gas exporters.
The similarities that bring them together are greater than the differences that set them apart, but obviously, there are significant differences. Historically, their relationships with the Muslim Brotherhood have been quite different. Their relationships with regional powers, such as Turkey and Iran, have also been different, at least on the tactical level as far as Iran is concerned. You have countries like Oman, Qatar, and even Kuwait to some extent, that have traditionally been more willing to engage with Iran. They see that as being a more effective means of managing that large and potentially threatening neighbor. But you see differences in their relationships with Turkey. For example, Qatar clearly has a very strong relationship with Turkey. That aligns, more or less, with the fact that Qatar tends to be more permissive and open to the Muslim Brotherhood, at least on the regional level, not within Qatar's domestic polity.
So, in a sense, you do see these differences and they can be significant. They have been very significant over the past decade, especially with the Arab Spring, which was a period characterized by rivalries and competition over who gets to exert more influence within the region and who gets to shape geopolitical outcomes.
Jon Alterman: It also seems to me that their approaches to China have been different. Saudi Arabia seemed to be much more interested in getting closer to China, then it became much less interested in getting closer to China. We've seen the United Arab Emirates seeming to get closer to China and then striking this deal on AI that seems to align it more closely with the United States. How do countries differentiate a future relationship with the United States and a future relationship with China?
Hasan Alhasan: What brings all the Gulf states together is a realization that you can't really choose between any of these two partners. There are strategic security interests with the United States. There are major economic interests with China, which ultimately is their largest oil market and their largest economic partner in terms of trade. Also, regarding Russia, there's obviously a common interest in managing the oil markets.
There is commonality in not wanting to choose. None of the Gulf states have chosen to enforce Western sanctions against Russia precisely because they share this realization. Beyond that, their appetites and their room for maneuvering and engaging with China—and even Russia—differ quite significantly. In the past, until rather recently, the UAE had clearly taken the lead in establishing and positioning itself as China's most significant interlocutor in the Gulf, but Saudi Arabia has really grown a much bigger appetite for engaging with China. You see that happening at the scientific, technological, economic levels, but also increasingly in defense.
You see it increasingly with Bahrain as well, which recently struck a strategic partnership agreement with China, even though Bahrain was perhaps the slowest of the Gulf countries to really build a relationship with China. Oman also has an interest. It's the only Gulf state to have received soft loans from China to support its budget, and it relies massively on the Chinese market for oil exports. But the pace of diplomatic relations varies somewhat with Kuwait and Qatar being slower to build a more robust relationship with the Chinese.
Jon Alterman: How much fear is there that a relationship with China in certain fields will undermine the relationship with the United States? How much expectation is there that China will fill some of the gaps that a less intimate relationship with the United States would create? Is there fear that gap would be wider because China simply won't do what the United States can do and has been willing to do?
Hasan Alhasan: It is a complex dynamic, and I don't think the Gulf states see it as a very clean trade-off. China has acted opportunistically and so have the Gulf states. For example, the Gulf states wanted armed UAVs or drones from the United States. When they couldn't get them, they turned to the Chinese but also to others like the Turks. The Gulf states are going to get however much they can get from whoever they can get it from. If they really want something, whether it's a piece of military hardware or assistance on AI or semiconductors, they have proved to be very dogged and pragmatic in their resolve.
The United States has tried to impose certain trade-offs by conditioning access to certain emerging and disruptive technologies deemed critical to U.S. national security if Gulf states don’t curtail relations with China in those fields. I think the Gulf states have successfully pushed back against U.S. pressure when it comes to Huawei and 5G telecommunications infrastructure.
Jon Alterman: Although the United States was concerned about Huawei. It interrupted the F-35 sale to the UAE, and there still hasn't been an F-35 sale to the UAE.
Hasan Alhasan: That tells you quite a bit about UAE decision-making and why the UAE decided to press ahead with Huawei despite the risk of foregoing the F-35 deal. That's part of the pushback against the zero-sum equation that the United States is trying to impose. In certain areas like AI where the United States continues to have an advantage over China, I think you'll see the Emiratis pragmatically decide to align with the United States. The Saudis have been somewhat more on the defensive. I wouldn't be surprised to see a two-system approach where sovereign wealth funds or state-owned enterprises align with the United States, whereas education institutions might seek cooperation with the Chinese. You might really start seeing this kind of behavior to try and maximize the benefits of engaging with both parties.
Jon Alterman: We've seen a call in the Gulf to have formal written agreements with the United States on defense issues without an accompanying commitment that, in a world that seems to be bifurcating, the Gulf states cast their lot firmly with the United States. Is there concern that this idea, what you might call “positive neutrality,” will become unsustainable in an increasingly divided world?
Hasan Alhasan: That's a great question, but it's really a matter of perspective. I think the Gulf states see it rather differently. They see a credible threat of edging closer to China as constituting useful bargaining leverage vis-à-vis the United States. The United States would not be as interested in deepening its defense and security commitment to Gulf states unless it thought that failing to do so would impact their appetites for engaging with China.
The United States has been rather vocal in its concerns about the potential Chinese military footprint in the Gulf, including in Abu Dhabi or even in Oman. The Gulf states are somewhat dexterous at using those concerns. If the United States doesn't formalize its commitment, then the Gulf states will find different ways of achieving what their trying to do. They see this as a point of leverage, but it's a very delicate balance. If they go too far with China in certain domains, the risk is that it could backfire and end up undermining the U.S. security commitment.
Jon Alterman: We've talked about China, and we've mentioned Russia, but we haven't mentioned a country you know a lot about: India. Are we underestimating the future role of India? People talk about India as a strong middle power becoming—as some Indians see it—a weak Great Power. India's involvement in the Gulf has been growing. As we think about the geopolitics of the Gulf, do we need to pay more attention to the changing role of India?
Hasan Alhasan: If anything, there's been a degree of overexcitement in Washington about the potential role that India could play in the Middle East and the Western Indian Ocean. The idea that the United States could create a network knitting together partners in the Indian Ocean with partners in the Middle East. We've seen that manifest itself in I2U2, which brings together India, Israel, the United Arab Emirates, and the United States. We’ve also seen it with IMEC, or the India-Middle East-Europe Economic Corridor, which is supposed to be this multimodal transport and trade corridor linking India to Europe through the UAE, Saudi Arabia, Jordan, and Israel. Betting on a larger role for India has been somewhat of a hallmark of this present administration's approach to the Middle East.
At this point in time, India has little to offer. India doesn't have really much capital to put on the table; it’s looking to attract investments from the Gulf. It doesn't yet have the willingness to be a full security partner for the United States in the region. Yes, it's become an observer of the Combined Maritime Forces, but it's not a fully participating member. That partially has to do with the fact that India doesn't like to follow the United States’ lead when it comes to security and defense constructs in the Indian Ocean, but it is also because of Pakistan's membership in the Combined Maritime Forces.
Beyond that, India's foreign policy in the region has not evolved to such an extent. It doesn't have the toolkit to be an influential player that could shape geopolitical outcomes in a way consistent with U.S. foreign policy, or even in a way that makes a significant difference to the region—not just yet at least.
Jon Alterman: You certainly have India-China tensions, and India might see the Gulf as a way to address some of its challenges and competition with China. Could that impact the situation in the Gulf, or do they really have too few tools to be impactful?
Hasan Alhasan: I do think India is concerned about China's growing influence in the Gulf. They tend to see it within the framework of a so-called “string of pearls” policy. The idea that China could end up encircling India and the Indian Ocean by building ports and dual-use infrastructure that it could weaponize in times of war. They see Chinese investments in ports like Duqm, the UAE, and potentially even in Iran. Meanwhile, the Iranians seem to be playing hardball with the Indians on Chabahar port, which is a port that the Indians were supposed to be developing for over two decades, but they faced obstacles partly due to U.S. sanctions. The Iranians played hardball at some point by threatening to bring in the Chinese on various contracts, and that spooked the Indians.
India does have a great deal of concern about what they perceive to be China's growing influence in the region. Now, I do think India's concerns are also exaggerated, because I don't think China can force a geopolitical outcome in the region that countries in the region did not want in the first place. China doesn't have that kind of leverage over the Gulf states. However, I don't think that India is willing or able to expand a lot of diplomatic capital—nor do I think is it able to do anything—to stem China's growing influence in the Gulf region at this point.
Jon Alterman: I also wonder about China's willingness to expend diplomatic capital. We certainly haven't seen China play a very active role in Red Sea security. Not only does so much Chinese trade passes through the Red Sea, but also, China made a large investment in Egypt and Suez Canal tolls are down 57 percent since January. We haven't seen Chinese diplomacy on Gaza be meaningful at all. It seems that China has been remarkably passive on the issues that are most important to Gulf states. Does that have an impact?
Hasan Alhasan: I think it does. I don't think the Gulf states are expecting or would even want China to play a game-changing role in Middle Eastern geopolitics. I don't think they trust China enough yet for it to play a much larger security role or to evolve into the kind of strategic partner that the United States is. But I think they do see China as a marginal, useful, and opportunistic player.
If the Saudis can get China to broker a deal to restore diplomatic relations with Iran, then fantastic, because clearly the United States is either unwilling or unable to do so. If the Saudis and Emiratis can attract Chinese investments into their oil and critical infrastructure and, by doing so, give the Chinese a vested interest in Saudi and Emirati stability and restrain Iran, then that's all the better. If China can act as a useful diplomatic partner in the UN Security Council and vote in a certain way on the Palestinian issue, then that's also great. The point is that it's very opportunistic. I don't think there is a great deal of expectation being placed by the Gulf states on the kind of diplomatic or security role that the Chinese can play. The limits of China's appetite are clear to everyone in the region.
Jon Alterman: Until about a year ago, every time I went to the Gulf, people would tell me, “The United States is on its way out the door. The United States is abandoning us. The United States has lost its interest in the Gulf.” Since October 7th, I haven't heard that at all. We've seen Operation Prosperity Guardian in the Red Sea as a sign of U.S. willingness to fight on behalf of global security issues in the Middle East. What happened to the concern about a U.S. withdrawal? What are people's assessments about U.S. commitment to the region, and how is the region responding as a consequence of what we've seen for the last nine months?
Hasan Alhasan: Pre-October 7th, I largely agree with you. There's been a series of disappointments in the Gulf regarding the extent of the U.S. security commitment. Not necessarily the level of troops or military equipment that it maintains in the region, because that hasn't changed tremendously, but rather, the extent of what the United States is willing to do with the firepower that it has amassed in the region. There are two important watershed moments of late: the 2019 Iranian attacks on the Saudi Aramco oil facilities and the Houthi attacks on Abu Dhabi. The lukewarm U.S. response, the United States’ unwillingness to use military power to respond, was seen with a large degree of disappointment.
That was an important moment that prompted Gulf states to rethink their approaches to managing regional threats. This disappointment is partly responsible for the de-escalation we saw between the Gulf states and their regional rivals, such as the resolution of the crisis with Qatar and the repairing of relations with Turkey and even Iran.
Now, there is no doubt in anyone's mind in the region that the United States is willing to use firepower and military power, and that it is willing to fight on behalf of Israel. I think this is how the United States’ intervention in the Red Sea is being perceived. It's also partly the reason why none of the Arab States, none of the Gulf states, no Muslim-majority country, with the sole exception of Bahrain, decided to participate in Operation Prosperity Guardian or support the U.S.-led attacks on the Houthis in Yemen. These are perceived squarely as being on behalf of Israel.
The Israel-Hamas war has, I think, set the U.S.-GCC strategic partnership on a more equal footing. In the past, the risk of entanglement was always perceived by Washington. Washington had always been reticent and hesitant to upgrade its defense and security commitment to the Gulf states for fear that the Gulf states would prove to be reckless vis-à-vis Iran and could end up dragging the United States into a war with Iran. That perception is now being reversed. The Gulf states see the United States as being hostage to Israeli decision-making, which has proved very reckless over the past few months. Ultimately, it's Israel through the United States that could end up dragging the Gulf states into a war with Iran that they do not want.
That explains why the Gulf states have chosen to preserve these diplomatic relations and have chosen to protect the de-escalatory dynamic with Iran. It's part of the reason why the Gulf states chose not to put on an offensive posture by lending their support to Operation Prosperity Guardian or to the U.S.-led strikes against the Houthis. It also explains why there's been a degree of reporting about the UAE restricting the use of their territory and airspace to the United States to prevent the United States from using their territory to launch attacks against the Houthis in Yemen or even against targets in Iraq. It also explains why the Gulf states have been asking the United States not to use Gulf-based bases or airspace to launch attacks against Iran.
There is a realization now that after years of concern of U.S. abandonment, the relationship is now on a more equal footing. The United States needs its partnerships and relationships with the Gulf states, partly to deter Iran and to preserve Israel's security. These relationships have proved extremely important in allowing and enabling the United States to blunt Iran's attacks against Israel. There aren't many other partners that can offer the United States the same amount of room for maneuvering and the safe space to operate as the Gulf states in the Middle East region. This is a highly contested region, so I think there is this really interesting realization and reshaping of the dynamic coming out of the current war between Israel and Hamas.
Jon Alterman: As you note, regional states helped defend Israel against an Iranian attack in April. No country that's been part of the Abraham Accords has walked away from that. There seems to be an expectation that relations with Israel will pick up, and I think a similar expectation that relations with Iran will be sustained. It feels like the Gulf is trying to have it both ways by sustaining relations with Iran and growing relations with Israel, while also sustaining relations with the United States and growing relations with China. What are the trade-offs of trying to have it both ways?
Hasan Alhasan: Yes, I think the Gulf states are trying to have their cake and eat it at the same time. They do this by maintaining a rather delicate balance on certain issues. For example, you mentioned what the Gulf states have done by way of intercepting Houthi UAVs and Houthi missiles, but also by assisting the United States in intercepting the direct attack launched by Iran on Israel. I think the Gulf states would say that they are adopting a purely defensive posture. They're intercepting projectiles that are crossing over their territories, and they're not really presenting a threat to Iran.
The Iranians seem to accept this as a compromise that they're willing to live with. By threading the needle, the Gulf states are trying to manage the trade-offs of having good relations with Israel and with Iran at the same time.
This was the thrust of Gulf foreign policy prior to October 7th. You had the Emiratis and the Saudis talking about the shared prosperity agenda, which is this old idea that through economic interconnections, such as investments in connectivity, infrastructure, and trade, the interests of all the different countries in the region can be intertwined. This could have a peace-inducing effect. The war now is seen as somewhat of a spoiler, but not necessarily as a total game-changer for the Gulf states.
Saudi Arabia obviously sees an opportunity. They see themselves as having greater leverage to negotiate a binding U.S. defense commitment in exchange for the normalization of relations with Israel. They know that the Saudi normalization agreement with Israel is part of the off-ramp strategy that the Biden administration is trying to construct for Benjamin Netanyahu to say, “If you end the war, that there would be an upside of establishing a diplomatic relationship with Saudi Arabia.”
The Saudis know this, and they know that President Biden is pressed for time. He's obviously facing a looming election, and so they see this as an opportunity to get a deeper defense commitment from the United States. Ultimately, the Gulf states are still interested in sustaining all these relationships. They manage these trade-offs by walking various fine lines and striking delicate balances. Sometimes, these balances can go wrong, but at the moment, their strategies are paying off. However, they have to be more realistic about the pace at which they will be able to deepen their relationship with Israel. Grand connectivity projects are likely to become much less achievable, and I think the Gulf states know this.
Jon Alterman: Threading the needle is one thing with the Biden administration. It could be something very different with the Trump administration. One of the problems that all the Gulf states have is that there can be profound changes in U.S. strategy every four or eight years. Will the way the Gulf states are threading the needle now likely suffice in a Trump administration, which may have much less tolerance for balance and may be much more aggressive about Iran's regional role? How do the Gulf states think about their necessary agility if the U.S. political context changes dramatically?
Hasan Alhasan: This is a strategic dilemma for the Gulf states, probably one of their greatest strategic challenges. Their single most important strategic security partner, the United States, is liable to change its mind about how to approach Iran every four years or so. You went from a potential grand bargain under President Obama to maximum pressure under President Trump, and back to a more limited arms control approach under President Biden. Arguably, Iran has been the most volatile foreign policy issue for the United States.
The Gulf states initially approached this by voicing their discontent with U.S. policy. As you might recall during the Obama administration, the Gulf states were really trying to influence the discussion in vain by trying to prioritize the issues of Iran's regional proxy network over the issue of constraining Iran's nuclear program. I think they failed rather dramatically in moving the U.S. needle on this issue under the Obama administration.
The main lesson learned by the Gulf states is that they need an insurance policy. You take out an insurance policy by building a direct relationship with Iran, partly because U.S. deterrence efforts vis-à-vis Iran have not been extremely successful below a certain threshold. The Iranians have been getting away with having partner and proxy groups in Iraq and Syria launch attacks on U.S. forces without incurring a serious U.S. military response. I recall a testimony by the CENTCOM commander where he said that there had been north of 70 attacks launched on U.S. service members in Iraq and Syria, and only on three or four occasions, if I'm not misquoting him, the United States responded.
There was a perception of U.S. deterrence failure vis-à-vis Iran, and there was a maturing of Gulf foreign policy on Iran. Even the Saudis, the Bahrainis, and everyone else realized the need to engage Iran diplomatically. Also, they realized the need to bring new partners into the fold like China and Russia, even when no one else in the Western world would engage with Russia because of the invasion of Ukraine. They could use those relationships to constrain Russian and Chinese relations with Iran and attempt to build a degree of restraint. Really, it is managing this instability and volatility in U.S. policy.
I think we're potentially going to see more volatility with the Trump administration. It's very difficult to predict what the Trump policy on Iran is going to look like. I think the main lesson learned for the Gulf states is that they manage volatility by taking offsetting positions, by taking out an insurance policy, by building a direct relationship with the Iranians, and by building relations with Iran's main allies and benefactors, namely the Chinese and the Russians. This is how, by and large, the Gulf states have approached what has been one of their largest strategic challenges.
Jon Alterman: Hasan Alhasan, thank you very much for joining us on Babel.
Hasan Alhasan: Thank you for having me.
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