Competition and Cooperation in the Indo-Pacific
The green transition has often been defined as a global project centred on cooperation and the development of cleaner technologies. Moreover, it has often been framed as a choice between two perspectives: a genuine environmental project or a means by which geopolitical influence can pursue a green label. However, the materials and infrastructures required to achieve this transition are increasingly becoming instruments of energy security, economic power, and strategic competition. This is particularly relevant in the Indo-Pacific. The region plays an important role in the production and processing of critical minerals, the manufacturing and development of clean technologies and energy infrastructure. However, it is also characterised by the growing strategic competition.
This paper argues that the main focus should not be on whether the green transition has become geopolitical in the Indo-Pacific; rather, it should be on where and how this is happening. Through three cases (critical minerals, green industrial policy, and regional energy infrastructure), the paper examines the different ways in which geopolitical interests are shaping the transition. It illustrates that geopolitics does not affect the green transition in the same way across the region, a competition.
- Critical minerals
Critical materials can provide a clear example of how the green transition can transform economic interdependence into a geopolitical vulnerability. Clean energy technologies depend on minerals whose supply chains are highly concentrated; therefore, geopolitical influence stems from control over stages of the supply chain.
China demonstrates how supply chain concentration can create political leverage. In 2010, Beijing and Tokyo were involved in a maritime dispute near the Senkaku-Diaoyu Islands, which was followed by China restricting rare earth exports to Japan, among other restrictions. The incident has been studied as a demonstration of the geopolitical risks associated with concentrated mineral supply chains (Evenett and Fritz, 2023). This event illustrates a broader pattern. After the US, Japan, and the Netherlands coordinated and introduced export controls to limit China’s access to advanced semiconductor technology, Beijing responded by introducing new licensing requirements on gallium and germanium, which later extended to graphite (Baskaran and Schwartz, 2024). By 2024, China had also begun to slow approvals of export licences for other countries (Burnham and Lazarow, 2025).
The importance of this event is not simply that China can restrict exports; it highlights that the green transition shows other economies how vulnerable they are to disruptions in supply chains they do not control. However, opening new mines does not necessarily reduce dependence if the extracted materials are still processed elsewhere. Hence, the strategy on critical materials is to increase control over the entire supply chain rather than access to raw materials (Deberdt, Le Billon and DiCarlo, 2026).
Overall, this case is a coercive approach for the green transit Indo-Pacific; it demonstrates how the green transition can turn economic interdependence into a source of geopolitical competition and vulnerability. China’s role in the supply chain has led other states to treat its materials as strategic assets tied to economic security and technological competitiveness.
- Green industrial policy
China is dominant in clean technology manufacturing. In 2024, China accounted for two-thirds of the $2.1 trillion spent globally on the energy transition and is already the world’s largest producer of low-carbon energy (China Daily, 2025). Moreover, China produces more than 30% of the world’s manufactured goods -more than the US, Germany and Japan combined (World Bank, 2025). Western policymakers see this dominance as unsustainable, since they can set prices and put competitors out of the market. The European Commission estimates that global steel overcapacity will reach 721 million tonnes by 2027, almost five times the EU’s total steel consumption (European Commission, 2026).
Southeast Asia: The EU’s view of what this overcapacity actually looks like once it leaves China and arrives in their countries. The main aspect is that advanced markets are closing their doors. The US imposed anti-dumping and countervailing duties of up to 340US on US imports from Vietnam, Thailand, Cambodia and Malaysia in April 2025, aiming to prevent Chinese firms from routing their production through these countries to avoid lower tariffs (US Department of Commerce, 2025). By 2026, Chinese automobile manufacturers plan to build more than a million vehicles inside ASEAN countries, around 600,000 of them EVs, with Thailand, Indonesia and the Philippines serving as regional production hubs (Raghu, 2025). Even though it has been seen as an opportunity to boost their economies and create job opportunities, it has also been linked to China’s “dual circulation ” policy, which prioritises domestic self-sufficiency. China’s excess production is exported to other countries, where it competes with domestic industries (Tran, 2022). In the end, the region absorbs China’s surplus capacity with cheap investment and cheap energy, while regional manufacturers face competitive pressure.
There are two main explanations for China’s clean tech overcapacity. In Western countries, it is seen as a deliberate strategy; the Chinese government has supported a large expansion of industries – such as solar panels, batteries, electric vehicles- to increase China’s global market share. This allows Chinese companies to sell products at competitive prices while pressuring manufacturers in Europe and strengthening China’s position in clean technologies (Bruegel, 2024). On the other hand, China’s explanation focuses on its domestic economic system, the “Catalogue of Industrial Guidance”, which directs investments towards specific strategic sectors. However, this can encourage local governments and companies to invest and expand production even where demand does not grow at the same pace (Watanabe, 2025). Moreover, it creates competition among local governments, as each region tries to attract investment and support domestic industries, leading to weak coordination at the national level of production.
Unlike critical minerals, cleantech is characterised by competition alongside economic interdependence. The main focus is on how to remain competitive and protect domestic industries while maintaining access to the technologies needed for carbonisation. This provides an example of how economic competition and interdependence can coexist.
- Regional energy infrastructure
Critical minerals demonstrate coercion, while industrial policy demonstrates competition alongside interdependence. The ASEAN Power Grid appears, on paper, to be the most cooperative of the three cases. The International Energy Agency (IEA) estimates that Southeast Asia will need more than $300 billion in grid investment between 2025 and 2040, with around $27 billion earmarked for cross-border connections specifically (International Energy Agency, 2026). In May 2026, the Asian Development Bank announced a $50 billion Pan-Asia Power Grid Initiative, mobilised by building on a financing initiative launched by the World Bank and ADB in October 2025 to make cross-border projects more attractive to private investors (The Global Economics, 2026).
Although it can be understood as a strategic calculation and a form of cooperation, it also carries a real geopolitical and sovereignty risk. For instance, underwater power cables must cross the territorial waters of multiple countries and involve complex financing among national utilities (International Energy Agency, 2026). Hence, building an interconnected regional grid requires countries to negotiate on sovereignty, infrastructure ownership, financing and long-term dependence on one another. Moreover, global tensions are also shaping the development of these projects. China’s electricity exports to ASEAN rose by 42.9% in the first half of 202. This increase is linked to Southeast Asian efforts to diversify their energy supply away from regions exposed to geopolitical tensions, in this case, the Strait of Hormuz (Ma, 2026). This demonstrates that diversifying energy sources and supply routes can also reduce exposure to geopolitical disruptions.
Regional energy infrastructure can also become a space for geopolitical positioning and the involvement of external powers. The Philippines’ 2026 term as chair of ASEAN has pushed for greater grid interconnection with Malaysia and created an opportunity for the United States to advance its own regional interests through close partners. However, external actors do not need to disrupt cooperative projects; they can also provide financial support. Therefore, the ASEAN Power Grid illustrates how multilateral energy cooperation, primarily driven by economic and sustainability objectives, can create opportunities to pursue energy security and geopolitical influence (ASEAN Centre for Energy, 2026).
This demonstrates that a part of the green transition differs significantly from coercion associated with minerals and the competition associated with industrial policy. States pursue security and influence by participating in cooperative and multilateral projects rather than disrupting them. Cooperation has become a tool within the green transitions rather than an alternative to geopolitical competition.
4. Counter-strategies
Each of these dynamics has caused different responses from the different actors to manage their exposure to them. In critical minerals specifically, initiatives such as the Quad Critical Minerals have proved that there has been a visible shift in the Indo – Pacific; Japan, Australia, India and the United States’s collaboration seeks to diversify supply chains and develop alternatives to Chinese processing capacity (U.S. Department of State, 2026). Moreover, the response to China’s control over the critical material supply chain was wider than only in the indo pacific. The EU’s 2020 Critical Raw Material Action Plan set out to cut reliance on non- EU suppliers(European Commission, 2024), and in 2022 fourteen countries with the EU launched the Minerals Security Partnership to help finance supply chains outside of China(European Commission, 2024). Moreover, it demonstrates a broader approach of the issue; the EU has become a genuine participant with being on the fourteen partners in the Minerals Security Partnership, and the EU India free trade agreement -which aims to facilitate an easier reach of European critical mineral supply chains for Indian firms. These responses demonstrate that the initiatives are concentrated on critical minerals, where the risk is coercion and the incentive to act collectively is stronger.
5. Conclusion
The green transition in the Indo-Pacific is becoming an important arena for geopolitical competition, though it operates through distinct dynamics. The transition is creating new forms of dependency in which states pursue security, economic competitiveness and strategic influence rather than simply replacing economic interdependence with geopolitical rivalry.
The three cases illustrate these geopolitical competition dynamics in different ways. Critical minerals demonstrate that a concentrated supply chain can create strategic vulnerabilities while also providing states with political influence, encouraging states to treat access to minerals as a matter of economic security. The green industrial policy illustrates a more complex relationship between competition and interdependency. States work to protect domestic industries and reduce their vulnerability to Chinese manufacturing dominance while continuing to rely on the same technologies. Regional energy infrastructure presents a distinct dynamic in which multilateral projects, such as the ASEAN Power Grid, can support regional integration and sustainability while also creating new opportunities for energy security, strategic positioning, and external influence.
Ultimately, the green transition in the Indo-Pacific is shaped by economic objectives and strategic interests that operate through both geopolitical competition and cooperation. The three cases demonstrate that geopolitics does not affect the transition equally; it can involve coercion through a concentrated supply chain, competition alongside economic interdependence, or cooperative regional projects within strategic influence.
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