- Issue Briefs and Special Reports
- Jan 24 2018
China's Belt and Road Initiative (BRI) is a combination of planning for sustainable economic growth, market development and dominance, export of excess capacity and geopolitical assertion. It takes a range of already existing and ongoing Chinese governmental and state owned enterprise activities in the target regions of Central, South and South-east Asia, East Africa, Middle East and the Indian Ocean region and seeks to provide them with an overall coherence and direction.
This paper seeks to provide a descriptive account of the BRI by outlining Chinese economic and political activities in the broad region outlined above and seeking to connect the threads to create a narrative of what the BRI is all about and what it means for the region and the world.
The basic argument is that the BRI seeks to compact a large region comprising of the Indian Ocean littoral and Eurasia through highways, high-speed rail lines, pipelines and maritime linkages. Eurasia covers 70 per cent of the world's population, 75 per cent of its energy resources and 70 per cent of its GDP. Through enhanced diplomatic coordination, standardised trade facilitation, customs procedures, free trade zones, it seeks to take China's economy to a new plane, even while integrating those of the participant countries with its own economy. While this appears to be a mercantilist project, it is inevitably accompanied and synchronised with an expanding Chinese military footprint.
As of now, the BRI is a fairly loose combination of old projects, new schemes and future infrastructure development plans layered over by bilateral trade agreements that seek to promote Chinese trade to Europe and the Indian Ocean Region. But it has now taken shape as a massive, centrally directed core plan under Xi Jinping’s leadership, to take China into a New Era of prosperity and power.
China will become the dominant regional power in East and Central Asia in the short term, and a major Indian Ocean power by the 2030s. By 2049, China hopes to emerge as the principal pole of the economically and diplomatically integrated Eurasia-- a geopolitical rival of the United States.
Many target countries view this as a chance to get onto the economic growth bandwagon. They are heartened at the prospect of getting investment to enhance their infrastructure and industry, but the way this is structured, also means a growing economic inter-dependence on China.
However, simply put, BRI is aimed at promoting Chinese national interests and notwithstanding claims that they pursue a "win-win" model, there will be losers and winners in the process.
The disruption created by BRI can have a negative fallout for countries like India and Russia which view certain regions as part of their own sphere of influence. Many Indians see the BRI through the tinted glasses of the China Pakistan Economic Corridor (CPEC). Likewise, the Russians will see it through the prism of Chinese activities in Central Asia. But the reality is that Central and South Asia or Africa is not what BRI is all about; its principal economic goals relate to tying rich Europe close to a China that is becoming richer.
For India, blocking the BRI is not feasible, ignoring it would be self-defeating; New Delhi needs to work with like-minded states on a strategy that can persuade China to make it a participatory exercise or, minimise its downsides to its own economic and geopolitical standing by devising ways and means to use BRI to its own ends.
While railroads and pipelines may be hard-wired to destinations, the same is not necessarily true of ports. Indian corporates may and business and investment opportunities in the infrastructure being created in the name of BRI is Southeast Asia, Middle East and the Indian Ocean Region.