China’s digital silk road and its influence in the Indo-Pacific

Abstract

China’s Digital Silk Road (DSR) is aggressively expanding in the Indo-Pacific region. This policy brief analyses the DSR from the viewpoint of the Chinese Communist Party (CCP)’s engagement in implementing technology and its value. In addition, it explores the strategic aim of the People’s Republic of China (PRC) in the cyber domain, the impact of the DSR in the Indo-Pacific region and the reaction of Japan. The DSR is part of the Belt and Road Initiative and it is Beijing’s strategy to internationalise its technology. It leverages technologies to implement Beijing’s principles in the cyber domain. Expansion of the DSR increases the dependence of countries on China’s economy and technology. It locks in the infrastructure of recipient states and aligns them with China’s authoritarian values by using technology to stabilise their political regimes. Beijing’s strategic approach is vague and its purpose, roles and effects of the Chinese government and the private sector are unclear. This policy brief examines the DSR and uses the PRC’s policy and cases in the region as examples. This policy brief explores the following questions. What is the strategic aim of the PRC in the cyber domain? How does the DSR contribute to achieving this aim? To what extent does the DSR affect the Indo-Pacific region? How is Japan reacting? A concept that is key to understanding Beijing’s strategic aim is dual circulation. The CCP introduced this concept in 2020 to coordinate China’s domestic and overseas investments, technological developments, exports and profits. Beijing regards dual circulation as key to strengthening its influence on the international economy and politics.