November 16, 2010 / 11:34 AM / 9 years ago

Analysis - West's spies may raise focus on rising powers

LONDON (Reuters) - Signs of expanded state-on-state spying by rising powers like China and India may prompt a more vigorous response from the West, provided its espionage agencies can juggle resources already strained by counter-terrorism work.

In the decade since the September 11, 2001, attacks, Western governments have devoted much energy to scouring remote tribal areas of Afghanistan, Yemen and Somalia as well as increasing surveillance of their own populations.

While that will continue, experts say Western espionage agencies may look closer at the decision-making and military and cyber might of rival powers such as Russia and China, with the latter in particular seen as more assertive than ever before.

Proving what is happening in such a secret world is difficult, but some ex-spies see clear shifts ahead.

“In a way, the requirement has always been there, but I think it will become more important as the new emerging powers have greater influence,” Nigel Inkster, a former assistant chief of Britain’s Secret Intelligence Service (MI6), told Reuters.

“Some of these areas have been relatively under-populated because of the need to focus so much on transnational terrorism.”

While direct conflict between emerging powers and Western states is likely to be rare, competition — and occasional confrontation — is bound to heat up in areas ranging from currency policy to industrial espionage and cyber warfare.

Emerging powers are believed to be increasing spying on the West in a way not seen since the Cold War, targeting commercial as well as state secrets. But not without setbacks.

President Dmitry Medvedev told Russia’s once mighty spy agency on Friday to put its house in order after a spymaster betrayed a network of agents to the United States in one of Russia’s most serious intelligence failures in decades.

Fred Burton, a former U.S. counter-terrorism agent who is now vice president of political risk consultancy Stratfor, says the United States has already begun redeploying FBI resources back towards counter-espionage from anti-terrorism.

“HOSTILE FOREIGN ACTIVITY”

“It’s a huge challenge for Western intelligence services,” he said earlier this year. “For the last 10 years they’ve been focussed on counter-terrorism, Iraq and Afghanistan. Will that focus move back? I think it will. The question is how much.”

Among signs of a shift in priorities cited by experts is a November 3 Pentagon announcement that the U.S. military’s Cyber Command, responsible for shielding 15,000 military computer networks from intruders, had become fully operational.

Another is an announcement in an October 19 British military spending review of a 650-million-pound national cyber security programme — a notable increase in spending in a priority-setting exercise that slashed spending overall.

“What the Americans and British are too polite to say is that an awful lot of the drivers for these cyber ventures come from China, whether the specific threat be China’s government or its people,” said UK intelligence analyst Richard Aldrich.

Ian Lobban, head of Britain’s communications spy agency, the Government Communications Headquarters (GCHQ), said states were already using cyber warfare techniques to attack each other and needed to be constantly vigilant to protect computer systems.

The internet lowered “the bar for entry to the espionage game,” he said in an October 13 speech.

Aldrich sees India’s June 2009 deployment of a military spy satellite as a sign that New Delhi fully intends to exploit the intelligence and defence potential of space.

In the first public speech by a serving head of MI6 last month, John Sawers said that while terrorists might hit the West again “at huge human cost,” nuclear proliferation by states was a more far-reaching danger and the risks of failure in tackling challenges in the area by countries like Iran were “grim.”

Former MI6 officer Inkster — now head of transnational threats and political risk at the International Institute for Strategic Studies in London — said Sawers was probably also dealing with pressing matters daily involving the activities of Russia, China and other powers, and this would likely increase.

“It’s the difference between importance and urgency,” he said. “Obviously you’ve got a terrorist plot you’ve got to do something about it now. Maybe there are other issues that are more important but less urgent.”

“STATES WITH SHARP ELBOWS”

Keeping an eye on emerging powers was not simply a matter of monitoring a direct threat from them to Britain, he said, it was also about gathering enough information to advise policymakers on what steps Moscow, Beijing or New Delhi might take next.

Analysing the spending of Britain’s MI6 is difficult, as the annual Intelligence and Security Committee report is censored. In 2008-9, it said about 37 percent of Secret Intelligence Service effort was devoted to international counter-terrorism.

But Russia is mentioned, as well as a country whose name is censored. Iran is also cited in the report, which says Tehran’s nuclear programme is targeted by an effort that had attracted increasing funding over the last two or three years.

Some caution that any shift in priorities will be modest.

Western spies’ top priority will remain preventing lethal militant attacks, they say. The political cost of letting attacks succeed remains high, both to Western governments and to the heads of intelligence agencies themselves, they argue.

“That’s not to say the rise of emerging Asia is not important, but I would be surprised to see much in the way of resources pulled away from existing national security threats,” said Alastair Newton, a former Cabinet Office official and now political risk analyst for Japanese bank Nomura.

Former UK intelligence coordinator David Omand, now a professor at King’s College London, said he would be cautious about overstating the degree to which the world was changing.

“States with sharp elbows have always been there and intelligence agencies have responded accordingly,” he said.

Additional reporting by William Maclean, Editing by Sonya Hepinstall

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