The Shanghai Cooperation Organization (SCO) summit in Bishkek, Kyrgyzstan August 31-September 1 marked a quarter century since the organization’s founding. Its anniversary motto, “Together for Sustainable Peace, Development and Prosperity,” hinted at ambitions considerably grander than the institution’s record. The SCO now encompasses ten member states, including China, India, Russia, Iran, Pakistan, and four Central Asian republics – Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan – representing nearly half of humanity and a substantial share of global economic activity.

Yet headlines emerging from Bishkek often highlighted the organization’s internal dynamics and differing national priorities. Unlike last year’s summit, Chinese President Xi Jinping and Indian Prime Minister Narendra Modi did not hold a formal bilateral meeting, although their brief interaction during the summit quickly became a meme template among Indian netizens. Modi and Pakistan’s Prime Minister Shehbaz Sharif traded predictable barbs. Most stunningly, Modi directly urged Russian President Vladimir Putin to end the war in Ukraine “for humanity’s sake.” This comes shortly after Ukrainian President Volodymyr Zelenskyy revealed that China delivered an ultimatum to Russia not to use nuclear weapons in Ukraine, something China has not denied.

This focus on discord is not merely dramatic headline chasing; it reflects a genuine and consistently noted problem with the SCO. The organization brings together several geopolitical rivals. It is therefore difficult to imagine the institution ever evolving into a mirror of NATO. The SCO lacks the degree of institutionalization necessary to impose coherent policy on its members, while its principal powers lack sufficient leverage over one another to establish a common strategic direction.

But these features should not lead observers to dismiss the organization’s practical value for its members, especially the smaller ones. 

Institutionalization is a slow process, particularly among states with divergent political systems and strategic interests. The SCO already possesses permanent structures, including its Regional Anti-Terrorist Structure (RATS) in Tashkent, while members continue to debate additional mechanisms for economic and security cooperation. 

The summit featured credible proposals for institutional development, including Xi proposing AI hubs, Uzbekistan proposing an industrial cooperation mechanism, Kyrgyzstan pushing its Tamchy Special Financial Investment Territory for joint SCO projects and advocating for Bishkek as the headquarters of a joint development bank, and Tajikistan pushing for a regional digital agro-ecological platform. 

Other developments emerged from the forum, especially multilateral initiatives in which the SCO serves not as an institutional organizer but as an exhibition hall for projects that individual governments want to pursue. 

This has created an unusual dynamic within the organization. While SCO’s largest powers are often stalemated by competing interests, institution-building initiatives that make the greatest practical progress frequently emerge because smaller member states want them to. 

SCO summits have increasingly become venues where host governments promote their own economic and diplomatic priorities. The pattern was particularly visible after the 2017 meeting in Astana. The massive Astana Expo opened the following day, underscoring how the summit could function as a platform for the host country’s broader international ambitions rather than simply as a meeting of an increasingly institutionalized organization.

Kyrgyzstan continued that tradition in Bishkek this year. As the outgoing chair and summit host, Bishkek had an obvious incentive to use the gathering to advance national priorities. The China-Kyrgyzstan-Uzbekistan railway received prominent attention. The project, a flagship Belt and Road Initiative (BRI) corridor running from Kashgar through Kyrgyzstan into Uzbekistan, has the potential to reshape the country’s position within Eurasian transportation networks. Kyrgyzstan also successfully promoted emerging trade routes connecting with India and Pakistan via China and the China Pakistan Economic Corridor (CPEC) and inked a deal to drastically increase trade with Pakistan.

Kyrgyzstan, like many smaller SCO members, appears interested in maximizing the benefits of participation without presenting itself as uncritically aligned with the organization’s largest powers. While Bishkek has been open about its close economic relationship with Beijing, it retains an interest in attracting capital from outside the SCO’s economic orbit. Western capital remains valuable precisely because it provides an alternative source of financing, expertise, and commercial relationships. The establishment of the Tamchy Special Financial and Investment Territory in 2025, a special economic zone which serves as an outpost of Western regulatory codes and law in the region, illustrates this broader effort to create a more attractive investment environment.

This behavior should not be interpreted as contradictory or even unique. For smaller SCO states, strategic ambiguity is an asset. Kyrgyzstan has no interest in choosing between China, Russia, India, and Western investors when it can instead extract advantages from all of them. The same logic explains why Central Asian governments routinely embrace Chinese infrastructure while simultaneously seeking European, American, Turkish, Gulf, Japanese, and South Korean investment. Their objective and chief concern is maintaining their own agency.

That agency may be one of the SCO’s most fascinating unintended characteristics. Multilateral institutions often develop institutional behaviors their founders did not explicitly design. The European Union, NATO, and ASEAN all have political cultures and operating assumptions that went beyond the intentions of their architects. The SCO appears to be developing something different: an environment in which its smaller members possess greater freedom of economic maneuver than the organization’s nominal power structure would suggest.

China, India, and Russia each have substantial reasons to use the SCO for their own strategic purposes. That divergence limits any one major power’s ability to turn the SCO into an instrument of strategic alignment.

China has the largest economy in the organization and increasingly supplies the infrastructure connecting its members. Russia retains military influence and longstanding political relationships. India possesses substantial economic and demographic weight while maintaining relationships with both Russia and the West. Yet, none can herd the others into an arrangement that systematically disadvantages the others or Western involvement.

The result is particularly visible in Central Asia. Governments there have little incentive to surrender their ability to balance among external powers. Chinese railways and investment can expand economic opportunity, while American or European capital can provide diversification. Turkish, Gulf, Indian, Japanese, and Korean partnerships provide additional options. For governments sitting between much larger powers, dependency on any single patron is inherently dangerous.

The SCO therefore produces a paradox. Its smaller members often determine whether any institutionalization actually moves forward. The major powers may act as veto-players or set strategic priorities, but implementation often depends on whether smaller governments see a direct benefit. It seems that the SCO’s largest members increasingly result to multilateral arrangements bypassing the SCO when convenient.

This is why Bishkek may ultimately prove more revealing than dramatic images of Modi, Xi, and Putin standing together. The central question is not whether the three largest powers can appear united, nor is it whether they can identify areas of common interest. The more important question is whether they can convert that shared interest into an institutional structure capable of constraining the strategic choices of the organization’s other members.

The answer so far: no.

The organization’s most surprising winners are the states that were never expected to exercise much influence over it. Kyrgyzstan successfully used the summit and its 2025-2026 chairmanship to promote its economic priorities. Other small SCO states in Central Asia have long done the same, using the organization to attract capital, build connections, and preserve strategic options.

This is a very different outcome from the emergence of a unified Eurasian bloc or some grand anti-Western alliance some have predicted. For Washington, that distinction should matter. The SCO should not be dismissed as an ineffectual talking shop, but neither should it be treated as an embryonic anti-Western alliance with the activities of Beijing or Moscow ascribed to all of its members. Washington too would be better served by watching the multilateral announcements on the sidelines of the organization rather than taking grand declarations at face value.

So long as Beijing, New Delhi, and Moscow remain at loggerheads, they will be unable to impose a common strategic direction, and the organization’s smaller states will retain outsized influence and room to maneuver – particularly in the economic domain.

In Bishkek, that room was on display. The summit produced declarations, initiatives, infrastructure commitments, and political theater. More importantly, it showed that the organization’s smaller members can use a China-India-Russia-dominated forum without becoming subordinate to any single major power. The SCO may eventually become a more coherent institution. Until then, its greatest surprise is that the tail continues to wag the dog, and its smallest states, by converting membership into tangible development gains, are the biggest winners.