The word "sleepy" could have been invented for Ranai, the largest town in Indonesia's remote and sparsely populated Natuna archipelago.

It has few cars and only two sets of traffic lights. The cloud-wreathed mountain looming over it resembles a slumbering volcano. Nearby beaches lie pristine and empty, waiting for tourists.

From Ranai, it takes an imaginative leap to see Natuna — a scattering of 157 mostly uninhabited islands off the northwest coast of Borneo — as a future flash point in the escalating dispute over ownership of the South China Sea, one of the world's busiest waterways.