China’s pledge of course correction at second Belt and Road Forum has few takers

Globe spanning connectivity initiative of China has been in the eye of the storm after countries began to reel under the “predatory economic” practices of Beijing. Launched in 2013 by President Xi in Kazakhstan, Belt and Road Initiative (BRI) or the One Belt One Road (OBOR) has become integral to China’s foreign policy. In 2017 months into the inaugural session of the BRF (Belt and Road Forum), BRI is enshrined into the constitution. Aside the economic aspects, the imbued strategic implications of the initiative made it the famed “Project of the century” for the Chinese. Since its inception, besides prioritising connectivity, China expanded the economic cooperation with the countries party to the BRI. With over $1 trillion investments under its belt, BRI soon emerged as an unprecedented infrastructure investment initiative. Comfortably sitting over reserves worth $ 3 trillion, China began to rope in developing economies under the fold of BRI. Spearheading its ambitious project of expanding its global presence spanning Asia, Africa, Europe and even Australia, China signed intergovernmental agreements with 126 countries.

China’s overwhelming global aspirations raised many eye-brows. Signalling its arrival as an economic super power, China held bi-annual inaugural BRF (Belt and Road Forum) with lot of pomp and show heralded with triumphalism in 2017. Since then a lot of water has gone under the bridge. After an exuberant summit, BRI began to hog headlines for its opaque financial agreements, charges of corruption, collusion with local politicians and environmental degradation. China’s acquisition of the Hambantota port on a 99-year lease from Sri Lanka in lieu of its mounting debts and reports of Beijing takeover of Kenya’s Mombasa port in return for its $2.27 billion debt has spurred fears in international community about BRI. Acquiring of the strategic assets on foreign soil akin to Colonialism had stoked fears about Neo-imperialistic approach of China’s BRI initiative. Absence of financial sustainability, poor economic viability of Chinese funded infrastructure projects became synonymous to “debt traps”. Analysing the Chinese debts, Centre for Global Development announced that eight countries party to BRI- Djibouti, Kyrgyzstan, Laos, The Maldives, Mongolia, Montenegro, Pakistan and Tajikistan as vulnerable to debt ensnarement. Chinese investments faced severe backlash from the locals even. In Malaysia and the Maldives leaders romped home victory in elections by promising a paring down of Chinese investments. In most countries China failed to build broader consensus. Slowly, Chinese reputation began to erode.

Amidst looming clouds of apprehensions pertaining to BRI, China conducted second BRF on April 26^th. The major shot in arm in for China before the summit has been an endorsement of BRI by a G-7 country, Italy. In response to burgeoning international backlash and OBOR gaining traction as being the debt trap, addressing leaders from 36 countries, at the inaugural session of the second BRF, President Xi pledged to recalibrate the BRI. As per the latest amends, BRI is going to financially sustainable to the developing economies, more transparent and environment friendly. Devoid of the exuberance and much fanfare, cognisant of sombre mood of the nations, China has agreed to downsize projects.

Though the number of countries which attended the second BRF has gone up, heads of state of Poland, Sri Lanka, Turkey, Spain, Argentina, the Maldives and Montenegro were conspicuous by their absence. Heads of above-mentioned countries participated in the first BRF. Prominent participants included Russian President Vladimir Putin, Italian Prime Minister Giuseppe Conte, Pakistan Prime Minister Imran Khan, heads of ASEAN countries (except Indonesia). India has boycotted the first BRF and firmly maintained its stance expressing raising sovereignty concerns. US didn’t send any representative to BRF. During the course of summit, China signed contracts worth $64 billion.

With several of Chinese projects either stalled or revised or delayed countries are now worried about the locked finances. Coming under intense scrutiny, Premier Li Keqiang has promised some reforms in BRI months ahead of summit. Accordingly, Beijing has refrained from boastful appraisal of the BRI projects and even billboard leading the BRF forum reflected the changed perspective of Chinese leaders. Instead of effusive rhetoric, China welcomed suggestions from partner countries and expressed willingness to hold constructive consultations.

Days before the summit, China agreed to renegotiate contracts with Malaysia which has cancelled two projects worth $22.5 billion. Consequently, the $16 billion East Coast Rail Link will be now 30% cheaper. Similarly reeling under economic slowdown, Pakistan has pulled out from the $14billion Daimen-Basha Dam construction project, part of the $62 billion CPEC (China Pakistan Economic Corridor). Earlier Myanmar sought scale down of Chinese investment in Kyaukpyu by 80%. Nepal has scrapped $2.5 billion Chinese contracts towards construction of dams. To avoid debt trap, Bangladesh decided to intensify cooperation with number of countries and obtain financial assistance from multilateral institutions. To stem rising tide of criticisms towards BRI which acquired the euphemism of “debt trap diplomacy” China is now resorting to refinancing, debt write-off and renegotiations. Being too little too late, Chinese strategic analysts began silently protesting diversion of huge chunks of finances to far-flung areas even as economy is slowing down.

Till now the global presence of Chinese investments its opacity, large volumes and weak standards has been a cause of concern to the West. But now, under the ruse of scaling down the BRI, China is launching new projects like Polar Silk route, Digital Silk Route, Green Silk Route, Educational Silk Route and Space Silk Route revving up its engagement and global foot prints. China laid firm ground to Polar Silk Route by flagging off polar missions to Artic and Antarctic circles. Offering the services of its extensive Bei Dou Navigation Satellite System, a constellation of 35 satellites, China inaugurated Space Silk Route. With the advanced 5G Huawei telecommunication technologies, Beijing is luring nations to join its orbit. Despite its controversies and concerns of national security threats, China is tempting the closest American Allies to be part of the Digital Silk Route. After the cancellation of mining project in Ghana over concerns of water pollution and Myanmar’s Myitsone dam construction for destruction of ecosystem, BRI was bogged down by charges of environment destruction. Ever since, China began pursuing green projects to reduce carbon emissions and carbon foot print and began issuing green bonds for solar and hydropower projects. Soon it put into place Belt and Road Green Development Project. Beijing unveiled the academic wing of BRI, Universities Alliance of Silk Road (UASR) in 2015 which currently includes 132 universities across 32 countries kicking off the Educational silk route.

Marshalling copious amount of soft power, China is planning to increase its global influence. Consumed by the “America First” doctrine, American administration began retreating from the world order. Beijing with his immaculate projects on connectivity, infrastructure development, investments in industrial corridors is steadily filling up the vacuum created by the US. Smaller countries keen on treading the path of development are increasingly moving away from the American orbit despite the corrosive impact of the Chinese investments. Woken up the China’s burgeoning influence, countries are now launching new connectivity initiative.  Japan is now actively pushing its “Quality Infrastructure Investment” partnership as a reliable alterative to China’s connectivity projects. India-Japan-Indonesia have launched Asia Africa Growth Corridor. India has also increased its development assistance to its neighbours and unveiled Project Mausam. But the volume of Chinese investments remains unmatchable.

In response to the multi-billion dollars OBOR, Mike Pompeo, US Secretary for State announced $113 million towards energy and infrastructure projects in Asia at Indo-Pacific Business Forum in 2018. By January 2019, Trump signed a law Asia Reassurance Initiative Act (ARIA) giving a massive fillip to America’s engagement with Asian countries. To counter aggressive Chinese expansion, US rolled out this act which addresses the security issues, economic aspects and fosters values in the Indo-Pacific. While America is making attempts to compete with China and effectively engage with Asian countries, China seems to be way ahead of the curve inching towards the goal of realising Sino-Centric Asia.

Beijing’s pledge of high standards, more transparency at second BRF will insulate countries from the veritable debt trap. Compelled by several countries, China has embarked on course correction. Beijing’s conscious attempts to fix the flaws of BRI is thus a welcome change. But China’s obduracy and reluctance to address India’s fears over CPEC violating its sovereignty and eventual deployment of the security personnel along the corridor to protect its interests has epitomised its insensitivity towards India. Though President Xi continues to allude that BRI will pave way for win-win cooperation and better financial integration, his claims are dubious. Besides, China’s attempts to encircle India through the maritime silk route passing through Indian Ocean has impact the maritime security architecture of the region. BRI is corner stone of Xi’s foreign policy and his meteoric rise is indispensably linked to the success of the initiative. China aims to dominate the geopolitics through BRI. With the theme of “Belt and Road Cooperation, shaping a brighter shared future” China attempted to allay fears of nations. Despite the assurances of trimming down its projects, China with its multitudinous offer of choices of investments ranging from technology to education is attempting to entice nations towards BRI. But unlike financial investments, China’s entry into digital infrastructure is going to have huge ramifications on the national security of a country. BRI, with its global presence is already impacting the regional and global order. This new avatar of BRI is going to be ominous. Evidently, nations must exercise extreme caution before embracing China’s plethora of Silk Routes and monitor the projects rolled under veneer of BRI.

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