As maritime tensions intensify across the Indo-Pacific, the South China Sea has re-emerged as one of the world's most closely watched strategic flashpoints. Covering approximately 3.5 million square kilometres, it connects the Pacific and Indian Oceans through the Strait of Malacca and forms one of the world's most important maritime corridors.
Its geographic position has made it a focal point of competition between China and regional and extra-regional powers, including the US, Japan, Australia and India. For each, the South China Sea has become central to shaping the balance of power in the Indo-Pacific. Recurring naval patrols, coastguard stand-offs and diplomatic protests are no longer isolated incidents but manifestations of a broader contest over trade routes, maritime rights and the rules governing one of the world's busiest waterways.
Why the South China Sea Matters
Much of the region's importance stems from its role as a global maritime corridor linking the Indian and Pacific Oceans. At its south-western entrance, the Strait of Malacca serves as one of the world's busiest and most strategically important maritime chokepoints. Around one-third of global maritime trade, including manufactured goods, containerised cargo and energy supplies bound for East Asia, passes through these waters each year. According to the US Energy Information Administration, substantial volumes of crude oil, petroleum products and liquefied natural gas also transit the sea annually. Any prolonged disruption, whether through conflict, coercion or accident, would reverberate across global supply chains and energy markets. As a result, secure access to these sea lanes has become both an economic and a security imperative.
The sea's importance extends beyond its shipping lanes. Beneath its waters lie significant hydrocarbon reserves, including several billion barrels of oil and tens of trillions of cubic feet of natural gas, while additional resources are also believed to remain undiscovered in contested basins. The South China Sea is equally one of the world's most productive fishing grounds, supporting the livelihoods and food security of tens of millions of people across Southeast Asia and southern China. Yet overlapping sovereignty claims have constrained exploration and commercial investment, turning these economic assets into sources of geopolitical competition.
Competing Claims and Strategic Competition
Competition over these resources is inseparable from overlapping territorial and maritime claims among China, Taiwan, Vietnam, the Philippines, Malaysia and Brunei. China's claim rests on the so-called nine-dash line, which encompasses most of the South China Sea and predates the modern law of the sea. The claim conflicts with the UN Convention on the Law of the Sea (UNCLOS). Under UNCLOS, maritime rights, including territorial seas and exclusive economic zones, are derived from recognised land features rather than broad historical assertions. In 2013, the Philippines brought a case against China under UNCLOS's compulsory arbitration provisions. In 2016, the Permanent Court of Arbitration ruled that the nine-dash line had no legal basis beyond the maritime zones recognised under UNCLOS. It also found that several Chinese activities, including large-scale island-building, had violated the Philippines' sovereign rights. China rejected the ruling, but it remains the principal legal reference point for states challenging Beijing's maritime claims.
These unresolved legal and territorial disputes have drawn in major powers with wider strategic interests. For the US, the South China Sea is closely tied to freedom of navigation and the credibility of its alliance commitments in Asia. This is reflected in regular naval patrols near contested features. Japan depends on the sea for the bulk of its energy imports and has deepened maritime cooperation with Southeast Asian claimants to safeguard its maritime interests. Australia views a stable, rules-based Indo-Pacific as central to its trade and security, while several European countries have also increased their naval presence in support of international law. Together, these developments reflect broader concerns over freedom of navigation, regional stability and the credibility of the international maritime order.
India's Stake in the Waters
Although India is not a claimant, the South China Sea is central to its economic and security interests. More than half of India's seaborne trade passes through these waters en route to and from East Asia. Stability in the South China Sea has therefore become integral to India's trade and economic security. ONGC Videsh has held exploration interests in Vietnamese waters for decades, underscoring an important energy security dimension that China has periodically contested.
India's response has remained deliberately measured. Consistent with its Act East Policy and broader Indo-Pacific vision, it has expanded defence cooperation with ASEAN partners. At the same time, it has consistently supported freedom of navigation and adherence to UNCLOS without taking positions on competing territorial claims. Its approach emphasises capacity-building, naval diplomacy and legal advocacy rather than direct involvement in territorial disputes.
Shaping the Indo-Pacific Order
The South China Sea has become more than a maritime dispute. It has become a measure of whether economic interdependence, strategic competition and international law can coexist within a stable regional order. For India, the stakes extend well beyond freedom of navigation or regional diplomacy. Stability in the South China Sea will increasingly shape the security of India's trade routes, the resilience of its energy supplies and the credibility of its role as a maritime partner in the wider Indo-Pacific. How these competing interests are managed will shape not only the future of the South China Sea but also the credibility of the rules-based regional order.