The status of China’s Belt and Road Initiative in South Asia

• At the G-7 summit, U.S. and allies unveiled Partnership for Global Infrastructure and Intelligence(PGII) which is being seen as a counter to China’s Belt and Road Initiative (BRI).

What is China’s Belt and Road Initiative?

• Vision: Chinese-led investment of over $1 trillion in partner countries by 2025.
• Members: More than 60 countries have now joined BRI agreements with China
• Mechanism: To finance BRI projects, China offers huge loans at commercial interest rates that countries have to pay within a fixed number of years.
• Criticism: West has accused China of debt-trapping by extending “predatory loans” that force countries to cede key assets to China.
• Current Status: BRI have experienced slowing down as annual Chinese lending to countries has slimmed.

BRI’s investments

Pakistan

• China Pakistan Economic Corridor (CPEC): BRI’s flagship project and its biggest one in a single country, unvieled in 2015.
• Envisioned multiple projects involving energy, transport and communication systems.
• Under it Gwadar is developed into a smart port city.
  • Gwadar: strategically important as it is near Iran and less than 320 km from Oman.
  • Gwadar residents have protested against the project.

Sri Lanka

• Multiple infrastructure projects financed by China in SL came under BRI after its launch.
• BRI projects in Sri Lanka have been described as white elephants — such as Hambantota port.
• Sri Lankan government took $1.4 billion in Chinese loans for port’s expansion.
• Unable to service the huge loan, the government handed Hambantota port to a Chinese state-owned company on a 99-year lease in 2017.
• Other key projects under BRI:
• Development of Colombo International Container Terminal, Central Expressway and the Hambantota International Airport among others.

Afghanistan

• Not comprehensively brought into BRI.
• China had promised investments worth $100 million.

Maldives

• Maldives comprises two hundred islands, and both India and China have strategic interests there.
• BRI projects: 2 km long China-Maldives Friendship Bridge
• Over the years, protests grew against large borrowing from China.
• Maldives’ current regime has tried to distance itself from the BRI, focusing more on its ‘India First’ policy.

Bangladesh

• Bangladesh has been able to benefit from BRI while maintaining diplomatic and strategic ties with both India and China.
• BRI projects: China-Bangladesh Friendship Bridges, special economic zones, Karnaphuli River tunnel project etc.
• Multiple projects have been delayed due to slow release of funds by China.