2010-2020: Decadal Trends
China’s Belt and Road Initiative: More Misses than Hits
14 May, 2021 · 5767
Mahima Duggal reviews the initiative’s progress since it was launched in 2013, recommending that in addition to adapting to post-pandemic realities, Beijing will also have to respond to its many criticisms going forward
A fluid and evolving concept, the Belt and Road Initiative (BRI) has been mired in controversy since its inception. It has become a much-debated part of China’s ‘Going Global’ strategy and foreign policy calculus. As we enter a new decade, it is worth examining how the BRI has changed since it was conceived. Has it been a success or a failure? How could it evolve in the post-pandemic era?
The BRI has been at the forefront of Chinese diplomacy since its inception in 2013, under President Xi Jinping’s leadership. Over the past eight years, it has quickly become a signature of Xi’s foreign policy. While portrayed as a result of China’s generous friendship, it has served to further its aspirations of emerging as a dominant player in the region and beyond. The BRI is an extension of Chinese influence in its neighbourhood, and has considerably expanded the country’s economic and political clout.
A massive infrastructure-focused project, the BRI seeks to connect China with Central Asia, Eurasia, Europe, Africa, West Asia, South, Southeast and East Asia, and the Pacific, through a dual-track Maritime Silk Road and Silk Road Economic Belt. The Belt is defined by six economic corridors spanning the region. It comprises maritime routes, railways, highways, and energy pipelines. These represent the lines of a global value chain with Beijing as the central link that China is attempting to solidify.
Much of the BRI’s success can in fact be found in Central Asia and Eurasia. One of China’s most ambitious corridors, the New Eurasian Land Bridge (NELB), connects China with Russia, Central Asia (particularly Kazakhstan), Eastern Europe (Belarus and Poland), and eventually, Western Europe. With progress in 261 China-financed projects in Central Asia alone, the NELB is credited with reinvigorating previously obsolete transportation infrastructure and promoting economic activity. It is widely touted as the bridge between east and west; “the new Dubai,” the “Rotterdam of the future,” and a “flagship project of the [BRI].” It is cited as a standout example of what the BRI can achieve if implemented correctly.
Similarly, with 32 planned projects, the China-Mongolia-Russia Economic Corridor (CMREC), has become a catalyst to “usher in a new era of investment and high technology.” Since its launch in 2016, Beijing has successfully concluded several tripartite agreements to renovate transit lines and relax customs regulations. These have offered landlocked Mongolia crucial overhauled connectivity links to export natural resources, and Russia a shorter and more efficient route to access the Pacific. While only 10 China-Europe freight trains passed through Mongolia in 2014, 2018 recorded 900 trains, and 2020 over 2,268 trains. This marked a massive 53.5 per cent year-on-year increase. Total transit traffic through Mongolia under CMREC increased eight times by 2019.
The China-Central Asia-West Asia Economic Corridor (CCWEC), connecting Xinjiang to the Arabian Peninsula via Central Asia, is also considered a feather in the BRI cap. With its reach and numerous, intricate projects, the CCWEC holds immense potential for expansion in Eastern Europe, such as through deeper links with the South Caucasus. These projects are reportedly progressing well, with significant strides in areas like policy coordination, financial integration, and people-to-people contact. In fact, a 2018 World Bank report predicted that the CCWEC could reduce shipment times by 25.5 per cent, thus decreasing trade costs by 21.6 per cent—far more than any other corridor.
Despite these silver linings, the BRI has been embroiled in controversy, particularly in South Asia. It has earned the reputation of being an instrument of China’s hegemonic ambitions and a conduit for its charm offensive strategy, aimed at expanding political and economic influence.
India has questioned its financial viability, lack of transparency, and strategic implications. It has been among the most vocal critics of the project, which a number of scholars and analysts across the world have characterised as an exercise in “debt trap” diplomacy—engaging in “predatory lending” (or unsustainable debt) to build strategic assets. India’s opposition to the BRI is particularly driven by its concern over a buildup of Chinese assets in the Indian Ocean Region (IOR) as part of a ‘String of Pearls’ strategy to encircle India. Projects like the 1,700 km Bangladesh-China-India-Myanmar Economic Corridor (BCIMEC), a project that ceased to be officially listed under the BRI in 2019, have moved slowly amid India’s refusal to participate in the BRI.
For Pakistan, the BRI has offered great promise in meeting the country’s infrastructure deficit. However, it has also imposed unsustainable debt levels on the country, which was forced to seek an International Monetary Fund (IMF) bailout in 2019. Islamabad’s most recent Chinese loan of US$ 1.3 billion in July 2020, during COVID-19-induced adversities, has added to apprehensions about the former slipping into a debt trap. At the same time, the China-Pakistan Economic Corridor (CPEC) faces opposition from India, which considers the project illegal, and an encroachment on India’s sovereignty and territorial integrity.
Meanwhile, China’s acquisition of control over Sri Lanka’s Hambantota Port has become a “cautionary tale” about the BRI’s debt trap risks. Whether such debt trap claims are credible is a matter of fierce debate in international strategic and policy circles. Some argue that the Hambantota lease was not a debt-for-asset swap, and that Sri Lanka was not a victim but a middle power playing the situation to its advantage. Regardless, it has become a symbol of the BRI enforcing “subordination to Beijing.” China’s maritime strategy under the Maritime Silk Road (MSR) has become a security challenge to freedom of navigation in many ways. In the Indian Ocean particularly, MSR has focused on competition rather than development, precipitating militarisation and strategic rivalries. This poses a threat to the Strait of Malacca and the Gulf of Hormuz—both crucial chokepoints.
Essentially, rather than being an example of China’s global leadership capacity, BRI projects are investments in forging close political and military connections that ultimately benefit only Beijing. Even its purported successes, like the Khorgos border crossing along the NELB in Kazakhstan, have been undercut amid concerns about Beijing’s ambitions. The Khorgos project has run into several problems despite being portrayed as a game-changer. China's surveillance and detainment of Muslims, including the Uighur, Kyrgyz, and Kazakh, alongside its expanding economic footprint in the region, have created fears of Chinese encroachment. These internment camps have overlapped with the Khorgos project, with incidents like a Kazakh Chinese national fleeing the camp via Khorgos, and another allegedly kidnapped from Kazakhstan and detained in China. While its utility as an instrument of geopolitical influence is abundantly clear, Khorgos is still a long way off from demonstrating local benefit.
2013-2020: An Unfulfilled Mandate
Xi’s first term as president (2013-2018) was largely focused on establishing and garnering support for the BRI. With its expansion to 138 countries and 31 international organisations—accounting for 70 per cent of the world’s population, more than a third of its GDP, and 75 per cent of its energy reserves—this objective has seen success. Xi’s on-going second term is focused on the implementation and actualisation of the agreements signed. Practical progress on this objective has, however, been limited. Therefore, despite its promises of transforming the region, in reality little has changed under the BRI.
Notably, while the CPEC is cited as a flagship BRI corridor, it has had limited success during its five-year implementation period (2015-2020): only a quarter (32) of the 122 projects announced were completed. Most activity was concentrated in the energy and transportation sector amid curtailed ambitions. Promises to launch ICT ventures and special economic zones, and transform Pakistan into a high-value manufacturing hub, remain unaddressed. In fact, the CPEC has aggravated deep-rooted challenges in Pakistan, triggering protests and insurgencies in opposition to Beijing’s exploitation of regional resources, particularly in Balochistan, which has halted CPEC projects.
Similarly, while the China-Indochina Peninsula Economic Corridor (CICPEC) has helped Beijing enhance intra-regional trade with ASEAN, supported by free trade agreements (FTAs), its success is largely built on pre-existing transnational connectivity links. Connectivity between the West/East Chinese communities continues to remain divided under CICPEC.
2020 Onward: A More Sustainable Future Model?
A true measure of the BRI’s success will ultimately depend on Xi’s upcoming third term, as Beijing attempts to accomplish previously set goals while navigating a dramatically different security environment. This period will likely see China becoming more cautious in its investments, with a stressed Chinese (and global) economy and the pandemic’s adverse impact on existing BRI projects.
To be viable, the BRI will need to strive towards a more multilateral framework on the financing side, especially when it comes to corridors that are not bilateral in nature. It must not only adapt to post-pandemic realities but also respond to its many criticisms. Beijing will need to change the international narrative on the BRI by making Chinese financing more transparent and in-line with global norms.
To some extent, China can be seen attempting to do this. For instance, since the onset of the pandemic, Beijing has highlighted its Digital Silk Road (with a focus on AI, 5G, robotics, smart cities, etc) and Health Silk Road (through “mask diplomacy” and “vaccine diplomacy” efforts, for instance). It has also attempted to reframe foreign aid priorities in its new white paper by emphasising the credibility and sustainability of Chinese-financed projects, as well as humanitarian over profit-driven aid. Whether these are merely propaganda to further a narrative that Beijing wants to build internationally, or are in fact representative of a real shift, remains to be seen.
Mahima Duggal is an Associated Research Fellow at the Institute for Security and Development Policy (ISDP) in Sweden, and Editorial Assistant to the Series Editor for the Routledge Studies on Think Asia.
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