Then there will be a big LAN in Asia without physical connections to the outside Internet, Resulting in another small Internet emerging.
And we know there are large harshpowers in China.
Then what will happen to Bitcoin?
Will there be two Bitcoin systems co-existing?
If China just decided to close down all outside access to the internet by severing the connection through the cables (somehow), there are going to be a lot bigger issues for the people of China (essentially everyone from the dude who uses a PC once a year, or month, whatever, to the highest echelons of Chinese society. There would likely not be any sort of secondary blockchain involved because there would be too many issues within the borders of China, they would at best start a blockchain after a long period of stability post-cut. People would be more worried about actually feeding themselves.
That's why it will never happen. Nowadays many deals are being struck in the Internet. People are applying for jobs, dating, working from home when they're feeling bad. That's just the tip of the iceberg. Stock exchange uses the internet, military personnel uses it. If they cut all the lines people would become confused, some of them unable to perform their daily tasks. This would end up with the country becoming paralyzed and companies losing billions.