are no people in the American administration that understand Brazil right now,” says one analyst. It shows. ■ Sign up to El Boletín, our subscriber-only newsletter on Latin America, to understand the forces shaping a fascinating and complex region. This article was downloaded by zlibrary from https://www.economist.com//the-americas/2026/07/02/brazilians-are-going-gaga-for- chinese-brands
The AI boom and geopolitics are rewiring Asia’s oceans Pakistan’s army chief battles with its imprisoned ex-prime minister India’s government overhauls a vast workfare programme Why can’t India’s government build a decent website?
The AI boom and geopolitics are rewiring Asia’s oceans New cables between data centres are avoiding China and chokepoints July 2nd 2026 “THE SEABED is a battlefield,” Australia’s defence minister told a room full of admirals and generals in Singapore at the end of May. Richard Marles, citing several subsea cables that have been cut in the Baltic Sea and around Taiwan in recent years, joined 16 of his counterparts in announcing plans to protect the submarine tendrils of the digital world: the nearly 700 communications cables which mostly lie exposed on the floor of the world’s oceans. Governments and armed forces in Asia have only recently awoken to the importance of subsea cables. Some of their fears of subterfuge may be overblown; to date, no conclusive evidence has been shared to suggest that
the cuts highlighted by Mr Marles are sabotage. But they are right about the vulnerability of these arteries of commerce. And the private firms which build and operate almost all of the world’s subsea cables are not waiting for governments to better secure them. They are increasingly taking steps on their own to avoid Asia’s most contested waters. Asia and Australia are now connected to Europe by fibre-optic cables which tend to hug the coastlines of the Asian continent before heading up the Red Sea. But a combination of the AI boom and geopolitics is rerouting cable traffic across the Indian and Pacific oceans. This new geography avoids chokepoints like the Strait of Malacca and contested waters like the South China Sea. Much of it avoids South-East Asia entirely, running from the Middle East and India to Australia and then onward through the Pacific Islands to America. The first cable to run the new route was laid in 2022 between Oman and Australia, with spurs to the Anglo-American military base at Diego Garcia and the Cocos Islands, a tiny Australian territory in the Indian Ocean. Then, last year, Google announced that Christmas Island, another Australian territory in the Indian Ocean, would become a hub for a new cable network between Australia and the Middle East. Fibre will run from Oman via the Maldives to Christmas Island, and then onward to Australia. Meta’s $10bn Project Waterworth, a global cable network still in development, looks set to follow a similar course in the Indian Ocean. The first shift remapping cable routes is a change in who pays for them. Subsea cables are expensive. To defray the cost, for most of the last few decades big national telecoms firms would form consortia to build them. Back in 1999, one of the first big fibre-optic cables between Europe and Asia to come online, known as SEA-ME-WE 3, cost $1.3bn and had 92 consortium partners. Financing and planning a cable among so many firms tended to increase costs and delay laying it. Once it was funded, the number of partners involved pulled the route close to the Asian continent where the bulk of the customers were located. But the AI boom is scrambling the economics of the subsea cable business and changing its geography. Over the past ten years, internet giants have begun to finance and build cables single-handedly. That has simplified the
fundraising and planning process, and cut the lead-time for new cable projects. Google invested in its first cable in 2008. It has since funded at least 34 more, 18 of which it owns without partners. Increasingly, firms like Meta, Google and Microsoft are building cables not to connect population centres but to connect their data centres. And build them they are. By one estimate, the next four years will see an average of $4bn a year in new cable investment, the bulk of it by so-called hyperscalers seeking to win the AI race. While satellite internet service from firms such as Starlink is getting cheaper, it is still orders of magnitude more expensive to beam each gigabyte of data into space than it is to push light down a cable, and is likely to be so for many years yet. As a result, subsea cables still carry 99% of the world’s intercontinental internet traffic. As the subsea cable market consolidates vertically, it is expanding geographically. Unshackled from the need to remain close to population centres, ships are laying subsea cables across the open ocean more than ever before. The new routes have been drawn up to avoid seabed governed either by China or by governments that might seek to extract payment for laying or repairing a cable across a chokepoint, such as the Indonesian straits. Geopolitical risk has become particularly acute in the South China Sea, where China has yet to effect full control on the surface but exercises de facto sovereignty over the seabed. Under international law, states are not supposed to interfere with repairs to cables outside their territorial sea. But repairs to any cables within China’s “nine-dash” line, which stretches over a thousand kilometres from China’s coasts (and which it claims as the extent of its waters) require approval from officials in Beijing. Cables transiting through chokepoints like the Strait of Malacca run similar risks, says Samuel Bashfield, who studies subsea cables at La Trobe University in Australia. Constantly shifting rules set by littoral countries like Malaysia and Indonesia are designed to extract value from cable operations through measures like requiring the use of local ships. These can be expensive annoyances. But recent musings by Indonesia’s cash-strapped president and finance minister about how the country could make money from its position astride some of the world’s great sea-lanes suggest that more aggressive measures could be coming.
To avoid these risky shoals, more and more internet traffic is simply going around them. Google and Meta’s new networks run instead from the Middle East through Australia and onwards to Japan and South Korea or America. In the Pacific, cables increasingly use Guam as a hub to connect American allies in Asia. These new routes are part of an increasingly bifurcated internet infrastructure beneath the waves: no new cables between America and China have been approved since Barack Obama was in office. ■ For exclusive coverage of Asian politics, economics and security, sign up to Asia Bulletin, our weekly subscriber-only newsletter. This article was downloaded by zlibrary from https://www.economist.com//asia/2026/06/29/the-ai-boom-and-geopolitics-are- rewiring-asias-oceans
Pakistan’s army chief battles with its imprisoned ex-prime minister Which of Asim Munir or Imran Khan will prevail? July 2nd 2026 PAKISTAN’S POLITICS revolves around two men who detest each other. And just as in a good drama, their fates are entwined. One is Imran Khan, the swashbuckling all-rounder who led Pakistan to cricketing glory and subsequently went on to become prime minister in 2018. Mr Khan rode to power with the backing of the armed forces, who had, as they periodically do in Pakistan, grown tired of the old ruling parties. But he proved to be an erratic and often alarmingly messianic premier. He upset the military and political establishments so much that he was ousted in 2022, and is now serving a 14-year prison sentence on a trumped-up corruption charge. Behind bars, rather than dealing with tricky neighbours and IMF loans, his popularity has soared.
The other is Asim Munir, the steely and scheming army chief. He was fired by Mr Khan from his role as the country’s spy chief in 2019 (there were rumours that he had been sniffing around the tax affairs of Mr Khan’s wife). He has had ample opportunity for revenge. Appointed as military chief after Mr Khan was toppled, he secured his grip on the army, elevating himself to the post of field marshal. He extended its control over government, and hobbled Mr Khan’s party, the PTI (it has not been banned, but senior figures have been arrested and the party has been prevented from taking part fairly in elections). For a man who once operated in the shadows, he seems to be enjoying an increasingly prominent role on the world stage, in particular by helping to broker a ceasefire between America and Iran. At a summit in Switzerland in June J.D. Vance, America’s vice-president, gushed that he was one of two “very important people” in his life, the other being his Indian wife. As Field Marshal Munir plays the statesman, Mr Khan sits in a seven-by- eight-foot cell. In April he passed 1,000 days in prison. For the past eight months he has had little outside contact, and just an exercise bike and a few books to keep him occupied. Over tea at the family’s lush estate in the hills above Islamabad, Mr Khan’s sister, Aleema, accuses the authorities of trying to break her brother’s spirit. Meetings and phone calls have been restricted (the family can send him a regular supply of his beloved avocados, grown next door). Mr Khan’s eyesight is deteriorating due to a blood-clotting condition for which he has had five rounds of treatment under close supervision. His family have questioned official statements on his health and requested, so far in vain, that he be seen by his personal physician. The safest bet is that Mr Khan will stay in prison for as long as Field Marshal Munir is in power. That could be a long stretch, given recent constitutional changes which mean that the army chief could keep his role for another decade or more. Mr Khan could still have a hand in his fate, though. His popularity is an awkward problem for a regime that lacks legitimacy. Taking him for hospital tests in the dead of night suggests the government is aware of his appeal. Keeping Mr Khan locked up may be the safest option for now. But it is not without risks, particularly if his health worsens or public dissatisfaction grows.