Rattan Saldi*

The geopolitical and geoeconomic situation today truly underscores the urgent need for creating an environment of trust for a more interactive and interconnective world.  More so as the aspiring super power China and the lone global cop, the United States of America are vigorously pursuing their goal of economic, political, cultural and social dominance through large projects of connectivity, power, infrastructure development, trade and business in the countries of their influence.

The US withdrawal from Afghanistan after the rise of Taliban, prompted China to fill the strategic space in the land locked -blood-soaked nation. Moscow already has its clout over Kabul and the two Communist powers coming closer has led the US to formalize a security grouping to watch its interests in the region. Quadrilateral Security Dialogue, QUAD, it has formalised, seeks to keep China-Russia influence in the region in check.

New Delhi considers it vital to strengthen its ties with QUAD, and other regional groupings like Association of Southeast Asian Nations (ASEAN), and the Bay of Bengal Initiative for Multi-sectoral Technical and Economic Cooperation (BIMSTEC) to protect its political and economic interests. The underlying spirit behind all such groupings is safe guarding economic and political independence of member-nations.

India is a founder -member of regional grouping, South Asian Association for Regional Cooperation, SAARC. Other members are Bangladesh, Bhutan, Maldives, Nepal, Pakistan, Sri Lanka and Afghanistan. SAARC was very vibrant right from its founding year of 1985 up to 2015 but is dormant presently for reasons rooted in India-Pakistan ties, which are in cold storage after the terrorist attack on Pathankot military base in 2016.

A decade ago, in 2013 Chinese President Xi Jinping launched Belt and Roads Initiative, BRI, offering financial assistance for connectivity and infrastructure projects, particularly in Afro-Asian and European nations.  Almost two thirds of the world nations joined BRI. Some projects were completed while a substantial number are either languishing or yet to take off.

Reason: Debt trap fears after Hambantota experience of Sri Lanka, and CPEC plight in Pakistan. Also, the image of Chinese leader as the new global Shylock. Around 30 percent of Pakistan’s foreign debt is owed to China thanks to the $50 billion China-Pakistan Economic Corridor.

In his address to the third BRI Forum (Mid-October, Beijing) President Xi warned against de-coupling from China, hinting that he was aware of the concerns of participating countries but offered no sweetener.

Barring India, all other South Asian countries have joined the BRI band wagon hoping to reap quick benefits. India sees the BRI as President Xi’s ambitious plan for extending China’s global influence. New Delhi also views CPEC as an attack on India’s sovereignty and territorial integrity, since the China-Pakistan Economic Corridor passes through Kashmir region under the occupation of Pakistan.  

China’s infrastructure lending has pushed some countries into deep debts, leading to Chinese firms taking control of such projects. As pointed out already, the Hambantota port in Sri Lanka is a classic example.  It has slipped into Chinese hands on a 99-year lease once Sri Lanka found it difficult to hold the white elephant.  

And popped up concerns in New Delhi that security in the maritime zone around India and Sri Lanka has been compromised. In recent weeks, Sri Lanka allowed docking of a Chinese research vessel at Colombo port. Two Chinese frigates remained in Sri Lanka’s vicinity for some time.

Maldives has seen growing Chinese clout. The incoming president of the archipelago, Mohamed Muizzu had fought the elections in what is no more than an anti-India plank with a pledge to remove Indian troops from the island nation after taking office.

Around 70 Indian military personnel maintain radar stations and surveillance aircraft at an atoll, close to Male, while Indian warships help patrol Maldives’ exclusive economic zone.

Muizzu has since promised to work together with all nations including India and China.

“Maldives is too small to be entangled in geopolitical rivalry. I am not very much interested to engage the Maldivian foreign policy in this”, he told AFP adding that Maldives is going “to work together with all the countries, India, China and all other countries as well.”

Recent geopolitical and geoeconomic developments suggest that China is trying hard to have a greater say in Bangladesh, Myanmar, Bhutan and Nepal – the nations with which India has good bilateral relations.  China’s role in these countries is mostly BRI centric though with political and diplomatic overtones.

China claims the $216 million international airport in Pokhara as the “flagship project” of its Belt and Road Initiative (BRI) in Nepal. But in a manner of speaking, the venture, has pushed the Sino-Nepali ties to a low. Anti-corruption officials in Nepal have begun an investigation into the project constructed by China CAMC Engineering, the construction arm of a state-owned conglomerate, Sinomach, as the contractor.

“The airport has failed to attract any regular international flights, raising concerns about whether it will generate enough revenue to repay loans to its Chinese lenders”, the New York Times reported, adding that Kathmandu has asked Beijing to change the loans into a grant to ease the financial burden, but China has not agreed to do so. 

According to the American daily, CAMC had inflated the cost of the project and undermined Nepal’s efforts to maintain quality control, putting a priority on its own business interests.  The building quality had been compromised and that the project’s infrastructure was not sound, two people familiar with the investigation are quoted in the NYT despatch as saying.

Some political analysts and Nepal watchers fear that Pokhara airport project may go the Hambantota way if China does not agree to lessen the loan burden.  

By all accounts the Pokhara probe is “the latest black eye” for China’s overseas infrastructure projects.

Experience of many BRI beneficiary- countries show that “costly and poor-quality construction leaves borrower countries awash in debt,” according to analysts.  

A natural corollary is growing mistrust between China and BRI beneficiaries and abrupt halt to projects mid-way.   

Malaysia, for instance, has halted an $11 billion rail link project “until a Chinese contractor agreed to slash the project’s costs.”

Five years ago, in 2018, China proposed developing trans-Himalayan multi-dimensional transport network including railway connecting mainland China with Kathmandu to reduce Nepal’s dependence on India for its third country trade.

The project DPR is yet to be finalized and financing details worked out. This venture is unlikely to see any progress till the Pokhara issue is resolved to the satisfaction of perennially cash strapped Himalayan nation.

India is assisting Nepal in infrastructure building, energy development, and cross-country rail and road connectivity. There is a gulf between the offer and demand though.

New Delhi needs to be proactive by factoring in the reality that a vocal section of Nepal blames India with lack of sincerity in project implementation and in resolving border issues.  

Perhaps India-Bangladesh ties can serve as a template in this regard.

With another northern neighbour, Bhutan, India enjoys a unique bilateral relation.   But Thimphu appears to be tilting Beijing way going by the recent Beijing visit of Bhutanese Foreign Minister and the stepped-up efforts to resolve the border row at Doklam, which, essentially, is a tri-junction.

Doklam is literally at a stone’s throw distance from India’s crucial Siliguri corridor. It is the gateway to its seven north- eastern states which share border with China, Myanmar or both.

Like in the past, this time around too, King Jigme Khesar Namgyel Wangchuk undertook a damage control operation. He visited New Delhi as a “reassuring gesture by Bhutan to India amid concerns about Thimphu’s apparent efforts to open up to China.”   

Clearly, the geopolitical scenario in India’s neighbourhood is witnessing a churning of sorts. This naturally calls for greater attention towards the sensitivities of the neighbours to make goodwill more pronounced. Deepening and broadening of assistance to create infrastructure in the fields of health care, education and skill development   will create a positive mindset for development aid from India.

–* The writer is a Delhi- based broadcast journalist and commentator