25 February 2023

‘BRI Aims to Provide Great Power Status to China’

Asian Lite’s Abhish K. Bose meets Dr. Krishnan to discuss the Belt and Road initiative of China. Excerpts from the interview.  

ABHISH K BOSE: The belt and road project is aimed at improving the position of China in the global economic system and to boost the scope for its emerging hegemony. In many cases a country will be unable to change its economy in a particular direction without altering the way the world economy is organised. Is the belt and road project guided by that intent? What does it tell us of the Chinese strategic thinking and policy framework?

Dr. ANAND: While there has been much written, speculated and anticipated, the BRI to put it in simple terms, was conceived by the Chinese party-state to export its overcapacities in economic production and therefore, look for new markets. In fulfilling this endeavour, if the initiative helps in altering how the world economy is organized, so be it. However, it does not seem that the BRI presents a credible and viable alternative by the Chinese which is very different from the existing world order and how the world economy is organized. I believe the BRI represents what geographer David Harvey calls ‘spatial fix’.

ABHISH K. BOSE: The belt and road is mainly about economic cooperation, comprising building,  factories, roads, bridges, ports, airports and other infrastructure as well as electric power grids, telecommunications networks, oil and natural resources pipelines and related projects. How will this project once executed can change the face of the regions where the project passes through?   Is there any hidden Chinese agenda behind this project?  

Dr. ANAND: Lack of infrastructural development is a pertinent issue in the global south, and many of the countries do not have the requisite resources to fulfill that. The experiences of countries in Africa, Southeast Asia and South America to the efforts by the West have not been really satisfactory. Plus, the legacy of colonialism weighs largely in areas such as Africa. It is here that the Chinese with deep pockets and more resourceful fill the gap. Plus, the Chinese are palatable for governments of all persuasions and do not necessarily interfere with domestic politics in these countries. However, while this is largely the narrative put forth by China, over the years there are also issues that have cropped up like debt related concerns/anxieties, cultural tensions, and over the last couple of years, COVID-19 related delays. In committing and investing in the infrastructural development of these regions, the Chinese champion the ‘win-win’ discourse, and seek to showcase their economic development externally. Rather than any ‘hidden agenda’, the BRI seeks to provide more diplomatic muscle and great power status to China vis-a-vis the US-led West. 

ABHISH K. BOSE: According  to available estimates, this massive project comprises of  the investment of 4 -8 trillion dollars. The terms of Chinese credit to countries party to the project vary widely, from interest free loans and even grants in the case of some projects in Pakistan up to commercial rate in the case of the Ethiopia – Djibouti railway.  Revealingly, Djibouti’s public external debt has increased from 50 to 85 per cent of its GDP since 2015, the highest for any low income country.  China has provided nearly 1.4 billion of funding for Djibouti’s major investment projects.  The Chinese company operating the port of Gwadar in Pakistan reportedly receives 91 per cent of the ports profits. Is the project an expression of Chinese economic imperialism and to what extent is it likely to burden the stakeholders?  

Dr. ANAND: Concerns of debt burden are logical corollary of the infrastructural projects undertaken by Chinese companies in the BRI. There is no finality on this aspect, as there is also new scholarship which problematizes – and critiques – the narrative of debt-trap. Scholars like Deborah Brautigam have in fact summarily rejected the discourse on debt trap. However, while the real extent of debt burden may be debatable, it is a reality that some of these projects do take the shape of white elephants. The best example of that would be the Hambantota port in Sri Lanka. I would be careful not to use terms like imperialism loosely, since these are very loaded and have to be properly contexualized/ historisized. 

ABHISH K. BOSE: Ports such as Gwadar and Kyaukpyu are intended to connect the Indian Ocean with China over land transport corridors.  Pakistan and Myanmar may become China’s California, granting it access to a second Ocean and resolving the Malacca dilemma.  Access to the offshore gas fields in the Bay of Bengal was always central to the Kyaukpyu project.  These points to the strategic aims of China through the project.  How, and to what extent, will these projects benefit China in the long run? How will it bear on its trade with India?

Dr. ANAND: With China, a lot of things also fall under the ambit of dual use/dual purpose. So, it is quite logical or even rational to look at these ports as fulfilling strategic aims/objectives. These ports also help China to offset some of the chokepoints in the Malacca straits, along with providing some access to fulfilling China’s energy needs in the longer term. Further, it helps provide China additional maneuvering space in the south Asian region. However, these ports need not necessarily be seen in binary terms vis-a-vis India, even though India’s role in the region has to move out of its conventional ‘big brother’ attitude, or patronizing behaviour. India also needs to heighten its own infrastructural and diplomatic measures in the region for sustenance of its relationship with these countries and not necessarily to only ward off the China challenge.

ABHISH K. BOSE: Bypassing the Malacca strait by building a canal through the Kra Isthmus in Thailand – around 100 km  long and  25 meters deep, would take ten years could be an even greater game changer.  From a shipping perspective it would mean shorter and cheaper- and speedier by two or three days – route for all. But a number of countries including the US may resist the idea because it could mean the speedier deployment of the Chinese Navy to the Indian Ocean.  Should this be a worry for the US or European powers?   

Dr. ANAND: It would not be wise to comment on something that is in the realm of speculation. Plus, this project would take some more time before it actually gets some proper shape. Hence, any possible opposition from US and others would also need to wait rather than do so now at the formative stage. Ultimately, it will depend on how effectively China is able to negotiate with the Thais in working on this project, especially given the delays on account of the pandemic and China only returning to normalcy now.

ABHISH K. BOSE:  It is said that  China hopes to build a ‘ Polar silk road’ along the Arctic shipping lanes, the third main sea route of the belt and road. Shipping through the northern sea route would shave almost twenty days off the regular passage time using the traditional route through the Suez canal.  Among China’s main interests in the region is its major stake in Russia’s Yamal liquefied natural gas project which is expected to supply China with four million tons of LNG. How will this benefit China?  

Dr. ANAND: Again, a lot of these projects are more on paper and on the realm of ideas rather than being in actual flesh and blood. Post the propelling of BRI, there has been a lot of romanticizing/fantasizing about the various possibilities of China’s shipping lanes. The Polar Silk Route is in my view, a very premature project and there has not been much weight or financial resources dedicated in this regard. While undertaking analysis of the BRI, it is also important to not be overemphatic, and be aware of speculation-ridden narratives. Further, Arctic routes and building projects around those are also highly cost ridden and it remains to be seen how the Chinese economy now emerging out of Zero Covid policies, will be able to readily take up such projects.

ABHISH K. BOSE: The roads as part of the belt and road project passes through the China -. Indian Ocean – Africa – Mediterranean sea blue economic package linking the China – Indo China peninsula economic corridor, running westward from the south China sea to the Indian Ocean and connecting the China – Pakistan economic corridor and the Bangladesh – China- India – Myanmar  economic corridor. Another road is the blue economic passage of China – Oceania – South Pacific, traveling south ward from the South China sea into the Pacific Ocean. Another passage is also envisioned leading up to Europe via the Arctic Ocean. What are the strategic importance of these roads? 

Dr. ANAND: Again, there is also a lot of fantasizing/romanticizing that is inadvertently associated with BRI. Hence, many of these roads are still on the realm of ideation, rather than actual presence. CPEC (China Pakistan Economic Corridor) is a credible example, while BCIM (Bangladesh China India Myanmar) economic corridor is yet to be termed a credible project given how India is still not a participant in BRI and in fact, is correctly reluctant in fitting this into BRI. Hence, despite many efforts by China, it is not accurate to bracket BCIM within BRI. China’s aim, through the roads, is to find new markets for its goods and distribute its overcapacity. Thus, rather than spreading wide and covering all areas, I believe the party-state would be more prudent and realistic in choosing those areas – especially post pandemic – which are not only commercially viable but also cost effective and have better returns to investment.

ABHISH K. BOSE: Another central driver of the Road concerns the growing trade connections between China and India.  In turn this will have to be based on huge infrastructure projects along the Indian Ocean coast or by train through Myanmar and Bangladesh. It was not surprising therefore to find that the port of Kolkata featured prominently in the original plans for the Road with the Indian city appearing on the famous map of the initiative published by Xinhua.  The port could be an important conduit in developing value chains connecting Chinese and Indian manufacturers, but more recently it has been dropped from all the official references, as India increasingly distanced itself from the belt and road project.  To what extent, if any, can the project boost the trade between India and China?

Dr. ANAND: I do not think that India will, at least in the foreseeable future, be ready to be part of BRI in any manner. While its trade relations with the People’s Republic of China will continue in the conventional bilateral manner, it would be reticent (and correctly so, in my opinion) to join this Initiative. There has been no development in the last few years for India to change its course and adopt a different stance on BRI, especially given the developments on the boundary and attempts by Chinese to change the status quo. Further, India is ridden with weak infrastructural capacity – I have written about this here in the beginning of the year 2020. Any hope for BRI through/including India is at best, wishful thinking than anything else.

Originally published in AsianLite.Com on 19 February 2023