India isolates itself as the rest of Asia joins China’s OBOR summit

India isolates itself as the rest of Asia joins China’s OBOR summit

P K Balachandran,
Nepalese Foreign Secretary S.D.Bairagi and Chinese Ambassador Yu Hong after signing MoU on OBOR

By spurning China’s invitation to be part of the multi-billion dollar, multi-continental One Belt One Road (OBOR) project on an issue of “sovereignty” India has completely isolated itself from Asia, and even its immediate neighborhood, South Asia, over which it claims exclusive influence.

All countries of South Asia, except India’s fiefdom of Bhutan, attended the OBOR summit at Yangqui Lake in the outskirts of Beijing being held on May 14 and 15.

The Maldives had joined the OBOR in 2014, and Bangladesh had signed up in 2016. Sri Lanka automatically became part of OBOR after the construction of the Hambantota port in 2010. Pakistan too had become a part of it as a result of the construction of the China Pakistan Economic Corridor (CPEC). And Nepal signed up this month.

Even countries which have complained of China’s hegemonic tendencies like Japan and Vietnam, had sent high level delegations to the meeting. The anti-Chinese Trump administration in the US had also sent a high level delegation headed by White House Advisor Matt Pottinger. From Nepal came its Deputy Prime Minister and Finance Minister Krishna Bahadur Mahara. Sri Lanka was represented by Prime Minister Ranil Wickremesinghe and the Minister of Strategic Development Malik Samarawickrama.

China has been consistently calling upon India to set aside political differences including long standing sovereignty issue over Pakistan-held Kashmir and join the OBOR for the sake of the long term economic development of South Asia and the world.

Speaking to the Nepalese paper Kathmandu Post recently, Prof. Hu Shisheng, Director of the Institute of South, South East Asian and Oceanic Studies, said that India should have no difficulty in joining the OBOR as it is already deeply involved in building international connectivity through the Bangladesh, Bhutan, India, Nepal Initiative (BBIN) and the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).

“India will naturally become part of the OBOR initiative whether New Delhi accepts it or not,” Prof.Hu said.

But the Chinese scholar feared that India could put pressure on the countries of South Asia, except Pakistan, to opt out of the OBOR and these countries may not be able to stand up to pressure or “disturbance” from India.

The wide-ranging MoU which India had entered into with Sri Lanka in New Delhi on April 25, could well be part of this pressure tactic. The projects mentioned in the MoU, each to be done as per a strict timetable, cover roads, railways, ports development, power generation and the setting of industrial or economic zones.

These are the very same things China’s OBOR is offering to the 68 countries it is hoping to rope into this multi-billion dollar project. Out of these, 28 were present at the Beijing meet on May 14.

However, undeterred by the April 25 MoU, and the visit of the Indian Prime Minister Narendra Modi on May 11 and 12, Sri Lankan Prime Minister Ranil Wickremesinghe took off for the OBOR summit on May 13. Bangladesh too set aside fears about annoying India, and soon after an official visit of Prime Minister Sheik Hasina to New Delhi, sent a delegation to the summit.

Prime Minister Ranil Wickremesinghe accompanied by Professor Maithree Wickremesinghe arrived at Beijing Capital International Airport, China (13th May).

While all these South Asian countries are eager to use China’s financial, industrial and technical resources to improve their infrastructure and services, India is staying out over the question of sovereignty over an area which had not been under its control since 1947.

India is objecting to OBOR in its entirety just because a part of it, the China-Pakistan Economic Corridor (CPEC) passes through Gilgit and Baltistan which are part of Kashmir but which Pakistan seized in 1947. India also fears that the success of the OBOR in its neighborhood will lead to its neighbors looking up to China rather than India for economic aid, investments and security. India may cease to be the dominant power in South Asia.

But then, India does not realize that despite many shared characteristics, cultural affinities, systemic similarities, and a shared history, its relations with its South Asian neighbors have been none too good. India is viewed as expansionist, interfering and domineering. Even its well intentioned schemes for the common good are viewed with suspicion.

Additionally, in this era of rapid economic development, when every nation wants to develop its economy and infrastructure, there is a search for finances and technical expertise which China can now provide in abundance but India cannot. India is itself extremely deficient in infrastructure both in terms of quantity and quality. Economically, India is a good 13 years behind India as the Chinese Ambassador in India, Luo Zhaohui, said in New Delhi recently.

China Steps Up Contribution To OBOR

According to Xinhua, China plans to enhance its contribution to the OBOR. It will be spending US$ 14.5 billion more on the project. The China Development Bank and the China Exim Bank will lend US$ 55.1 billion for OBOR projects. It will give US$ 1 billion for South-South cooperation projects; US$ 1 billion to international agencies involved in OBOR projects; and US$ 290 million has been allocated for emergency food relief and US$ 8.7 billion for civil (socially relevant)  projects.

The OBOR, conceived in 2013 by Chinese President Xi Jinping, is a combination of the 21st. Century Maritime Silk Road and the Silk Road Economic Belt. While political and strategic expansionism is certainly at the back of China’s mind in devising the OBOR, the project also has its roots in China’s urgent need to find external outlets for its excess industrial capacity, after having completed all its development works at home. China is now trying hard to marry its excess capacity with the acute hunger for infrastructural development in many parts of the world which are just about developing. And this is clearly for mutual good.

China Needs India

However as senior Indian journalist Prem Shankar Jha said in a recent article in The Wire the OBOR will be a profitable venture only if India joins it. Unlike many of the other Asian beneficiaries, it is only India which can give big projects and a large number of contracts too. Perhaps only India may be able to repay the loans. In the case of many others China may end up with non-performing assets (as in Sri Lanka).

This is the reason why China has been consistently inviting India to join in. But Indian Prime Minister Modi and the Establishment in New Delhi have turned a deaf ear to these pleas.

“Modi has cut his nose to spite China’s face”, Jha says.

Nawaz Sharif and his Chinese couterpart Li Keqiang what as officials sign an MoU at OBOR summit


Making Hay While India Stays Away

As Modi stays away, Pakistan, Bangladesh, Sri Lanka and Nepal are making hay. Pakistan has just signed an MoU with China to develop five big reservoirs as part of the Indus River Cascade (IRC), with the potential to generate 40,000 mw of power. The immediate objective of the IRC is to generate 22,33 mw. The US$ 50 billion MoU on IRC, will supplement the US$ 50 million pledged to the CPEC.

The MoU was signed knowing full well that the IRC covers the disputed Gilgit-Balitistan region of Kashmir.

Bangladesh and China recently signed 27 deals in addition to existing mega projects like the 1320 mw Payra therma power plant, the building of a multi-lane tunnel under the Karnapuli river and a bridge over the Padma river, and the procurement of six vessels. The Maldives will be using Chinese funds and expertise to further develop the Male airport, originally built by an Indian company.

Within three weeks after signing an exhaustive MoU with India, Sri Lanka on Saturday signed a comprehensive Framework Agreement with China. Titled “Outline of Medium and Long-term Development Plan for Investment, Economic and Technological Cooperation”, the agreement envisages providing transparent legal foundations, institutional environments and favorable investment conditions for a number of priority areas, including agriculture, manufacturing, transportation infrastructure, public works, energy, electric power, information communication, tourism, and urban construction. The MoU listed a number of projects which will be undertaken.

This is apart from the ongoing US$ 1.4 billion Colombo Port City project and the US$ 1.4 billion Hambantota port development and industrial hinterland project.