BELT AND ROAD INITIATIVE - learncrisp.com

Table of Contents

About

BRI refers to a Chinese global infrastructure development strategy
Adopted in 2013
Plan to invest in nearly 70 countries and international organizations
Xi Jinping announced the strategy as “Silk Road Economic Belt” during a visit to Kazakhstan in 2013
How significant is BRI ?
- more than 68 countries
- 65% of world’s population
- the regions 40% of lobal GDP
What is meant by Belt ?
- It refers to the land and railway routes
- It is also called Silk Road Economic Belt
What is meant by Road ?
- It refers to the sea lanes of communication
- It is a short form of modern Maritime Silk Road
What are the type of investments ?
- Ports
- Skyscrapers
- Railway Lines
- Roads
- Airports
- Dams
- Tunnels
By when will the Project be completed ?
- China has set a target of 2049 as project completion date to mark the centennial anniversary of People’s Republic of China (PRC)
- Its total cost is estimated at USD 4–8 trillion

How useful is the BRI ?
- As per World Pensions Council (WPC), Asia will need USD 900 bn worth of infrastructure of investments over the next decade to stay with the infrastructure requirements
What are the traditional routes which inspire the BRI Project ?
- Ancient routes connecting China to western countries
- Routes taken by Ibn Battuta and Marco Polo
- Ming Dynasty maritime routes
- Ancinet Silk Road
  - Originated during westward expansion of China’s Han Dynasty
  - 206 BCE–220 CE

How many countries are covered under BRI ?
- Around 146 countries spread across all continents:
  - 43 countries are in Sub-Saharan Africa
  - 34 BRI countries are in Europe & Central Asia (including 18 countries of the European Union (EU) that are part of the BRI)
  - 25 BRI countries are in East Asia & pacific
  - 20 BRI countries are in Latin America & Caribbean
  - 18 BRI countries in Middle East & North Africa
  - 6 countries are in South East Asia

OBJECTIVES OF BRI

BRI carries both economic and Geopolitical goals
It will help China with opening of new trade markets and develop new investment opportunities
It will boost exports and manufacturing
China wants to Renmibi to emerge as the currency of choice in international transactions
Infrastructure growth in Asia
Reduce US dependency

How will BRI be Financed? What institutions are involved ?

Asian Infrastructure Investment Bank
- It began operations in 2016
- It is a development bank dedicated to lending for infrastructure projects.
- It is to have an authorized capital of $100 billion
- China with 26.63% voting rights is the largest stakeholder

Silk Road Fund
- Itis a state-owned investment fund of the Chinese government to foster increased investment in countries along the One Belt, One Road
- Its total value is around USD 40 bn
- The purpose of this fund is to invest in businesses and not lend money for Projects

Debt Trap Diplomacy

Debt-trap diplomacy is a term in international finance which describes a creditor country or institution extending debt to a borrowing nation partially, or solely, to increase the lender’s political leverage.
It is said that China is using this policy
Why is China being accused of Debt Trap Diplomacy?
- 60% of lending comes from Chinese banks
- The loans are being extended to developing countries with not so clear and open terms
- Considerable number of loans have collaterals such as rights to a port or mining rights etc
- These can eventually lead to extraction of economic or political concessions from the debtor countries

What are various projects under BRI ?

Belt and Road is a massive infrastructure project with multiple corridors spanning 60 nations
Land Corridors
1. New Eurasian Land Bridge
  - It connects Western China with Western Russia
  - Passes via Kazakhstan
  - It includes Silk Road Railway that passes via
    - Xinjiang Autonomous Region
    - Kazakhstan
    - Russia
    - Belarus
    - Poland
    - Germany
2. Northern China through Mongolia to the Russian Far East
3. China–Central Asia–West Asia Corridor : China to Turkey
4. China–Indo china Peninsula Corridor : China to Singapore
5. China–Pakistan Economic Corridor (CPEC) : China to Gwadar Port Pakistan

Maritime Routes (Silk Road)
- Marine routes link china with
  - Jakarta
  - Singapore and Kuala Lumpur through Strait of Malacca
  - Sri Lankan Colombo
  - Malé
  - East African Mombasa
  - Djibouti
  - Suez Canal
  - Haifa, Istanbul and Athens
  - Upper Adriatic Sea
  - Italian Trieste
  - Rail connections to Central Europe and North Sea

Ice Silk Road
- The Polar Silk Road refers to Arctic shipping routes connecting three major economic centers – North America, East Asia, and Western Europe – through the Arctic Circle
Super Grid
- It refers to the development of 6 ultra high voltage electrical grids across China, north-east Asia, Southeast Asia, south Asia, central Asia and west Asia.

CHALLENGES around BRI

Political instability in many countries like Syria, Sudan etc
Lack of Transparency
Threat of Debt Trap Diplomacy
Ecological issues
- Emissions from power station being built as part of BRI
- Land and water pollution due to infrastructure projects
- High usage of fossil fuels in the projects
- Increased shipping will affect marine life
- As per WWF over 1,700 critical biodiversity spots and 265 threatened species will be adversely affected by the BRI.
- BRI could potentially introduce more than 800 alien invasive species
Human Rights Voilation
- Issue of forced labor
- Contract labor
- Xinjiang has a history of rebellion and resistance to Chinese rule

Recognition to BRI

Most of the affected countries have expressed support for the BRI owing to the infrastructure development that is to come with it
Around 130 countries have endorsed the BRI including Saudi Arabia, Singapore and Philippines

OPPOSITION TO BRI

United States
- has proposed a counter-initiative called the “Free and Open Indo-Pacific strategy” (FOIP)
India objects BRI due to
- Threat of Debt Traps
- India objects the CPEC passing via POK (Pakistan Occupied Kashmir)
- Lack of transparency and consultation
- India is also concerned with
  - China-Myanmar Economic Corridor (CMEC)
  - Nepal-China Trans-Himalayan Multi-dimensional Connectivity Network
Australia, Japan and France have Rejected BRI
US, Japan and Australia formed the
- Blue Dot Network in 2019
- Build Back Better World initiative in 2021

WHAT SHOULD INDIA DO ?

Indian response should be based on its long-term economic and geopolitical interests
India should focus on trade and transport infrastructure development like ports, railways and airports. Projects like Sagarmala are a step in that direction
India should also engage with BRI countries in Asia and Asia Pacific individually establishing trade pacts
India should work on increasing manufacturing and increase exports
Indian should strenthen its Naval presence in the Indian Ocean
Indian Ocean Rim Organisation can be used more effectively
India should not let itself get isolated whether it approves of BRI or not
BRI can help increase China India Cooperation in many new areas
India needs to integrate with the growing Asian Market. BRI can bring economic benefits.
India should facilitate trade, investment and business engagement with countries like Bangladesh, Vietnam and Indonesia

Author
Recent Posts

Sumit Teotia

Sumit is Creator and Author at learncrisp.com. He started this learning platform with a mission to emerge as an aspirants resource hub, especially for those preparing in self study mode. He loves writing and his interests are History, Security and Diplomacy.