While we are still deliberating on these issues the Chinese have stolen a march over us. Post creating wonderful infrastructure at home, they now plan to contribute to the infrastructure needs of the world. According to the Asian Development Bank, there is an annual “gap” between the supply and demand for infrastructure spending in Asia alone to the tune of $800 billion. The needs of Africa are over & above that fig. Beijing’s “One Belt, One Road” initiative is an attempt to combine its international strategic goals in Europe, Asia & Africa with its domestic needs. – Ramakrishna Jonnalagadda*
Prime Minister Modi’s “Bharat mala” project is, perhaps, a successor to Vajpayee’s “Golden quadrilateral” project & his own attempts to leave behind a glowing legacy. The national govt. has also announced plans to connect the “Bharat Mala” project spread across North India, to the “Sagar Mala” project across the south of the Vindhyas to achieve economic & strategic objectives.
The “Bharat Mala” Project
The “Bharat Mala” project envisaged across 13 states on a 5300 Km stretch – starting from Gujarat & passing through Rajasthan, Punjab, J&K, HP, Uttarakhand, UP, Bihar, Sikkim, Assam, Arunachal Pradesh & ending across the Indo- Myanmar border of Manipur & Mizoram – involves an expenditure of Rs 12 – 14000 crores during a 5 year timeframe. The road adorns the country like a garland & hence the name “Bharat Mala” This has a strategic component – to counter the impressive Chinese network build across the border – & an economic one – to provide accessibility to the border touching regions & improve border trade.
Critics have, however, argued that, at the current cost of Rs 10 crore per Km, the cost of the project is underestimated & would actually cost Rs 53000 crores. Costs could increase further if Nitin Gadkari’s suggestion of using cement instead of bitumen is accepted. Private participation to fund the difference may not fructify – considering their stretched balance sheets and therefore the onus shall be on the govt. to fund the project after accelerating the environmental clearances & land acquisition to complete the stretch within the stated timelines. This project in fact, is a late realization & a delayed response to the Chinese seamless road infrastructure on the other side & a dire necessity to prevent a repeat of the ignominy of the Indian defeat to the Chinese in 1962.
The “Sagar Mala” Project
The Sagar Mala project, announced with much fanfare, on Aug 15th, 2003, by PM Vajpayee, remained in a limbo during the UPA tenure till it was revived again under Modi’s tutelage. The new policy envisages a uniform policy framework for major ports – owned by the centre – & non-major ports – owned by the states to develop a holistic policy encompassing the needs of industrialization, trade, tourism & transportation. It involves the development of 10 CER (Coastal Economic Region) along India’s vast 7000KM coastline to create industrial clusters supported by inward linkages through multiple freight options – rail, land & inland waterways – for smooth evacuation of cargo from ports. This plan includes development of port-based industrial parks, captive industries and ancillary facilities such as ship repair, shipbuilding, ship-recycling, logistics parks, warehousing, maritime zones/ services, offshore storage, drilling platforms, bunkering, container freight stations, industries which requires significant import of raw materials and industries with large export potential to create more jobs.
The contra view, averred by C.D. Nandakumar, general secretary of Cochin Port Employees’ Organisation, CITU, published in The Hindu is that since the capacity utilization in Kochi port’s container terminal is less than 35% – not much different from many of the other major ports in the country – what is needed is full capacity utilisation & not creation of additional capacity while the same could be true, the creation of infrastructure logistics to reduce congestion at ports is definitely an urgent need.
The Chinese “Road & Belt” Project
While we are still deliberating on these issues the Chinese have stolen a march over us. Post creating wonderful infrastructure at home, they now plan to contribute to the infrastructure needs of the world. According to the Asian Development Bank, there is an annual “gap” between the supply and demand for infrastructure spending in Asia alone to the tune of $800 billion. The needs of Africa are over & above that fig. Beijing’s “One Belt, One Road” initiative is an attempt to combine its international strategic goals in Europe, Asia & Africa with its domestic needs.
The “Silk Road Economic Belt” and “21st Century Maritime Silk Road” are initiatives introduced by President Xi, in the fall of 2013, during visits to Kazakhstan and Indonesia, respectively & are expected to feature prominently in China’s 13th Five-Year Plan (2016-20) “Belt” includes Infrastructure projects that include road and rail routes, oil and natural gas pipelines, from Xi’an in central China, through Central Asia to Europe. The “Road” consists of a network of ports and other coastal infrastructure projects that extend from the East coast of China to Southeast & South Asia to East Africa and the northern Mediterranean Sea. The Asian Infrastructure Investment Bank (AIIB) and New Silk Road Fund (NSRF) shall support the program.
China is suffering from huge industrial overcapacity & the poor international trade environment has now started to bite. While economic development in Coastal China has produced an economic miracle, the southern & western regions of China are still underdeveloped. The infrastructure project, proposed as part of the “Belt and Road” initiative, is meant as a stimulus to connect the underdeveloped regions to correct economic disparities & create an internal economic integration.
The Chinese program is ambitious for it includes efforts to use of the Renminbi by foreign countries, create an “Information Silk Road” linking regional information and communications technology networks, and lower barriers to cross-border trade and investment in the region.
The Uyghur menace in its western quarters – largely in the Xinjiang province of China – is not helping matters. China is attempting to tame the same through an Af-Pak initiative – cutting off potential supply lines to the Uyghurs from their ethnic brethren – & also successfully undermining Indian influence in Afghanistan. President Xi, during his last visit to Pakistan, has concluded a $46 billion infrastructure project passing through POK (Pak occupied Kashmir) & ending at the Gwadar port, that not only provides a lifeline to the host country but incidentally runs parallel to the Delhi Mumbai industrial corridor. This corridor is also a solution to the Chinese concerns that the Malacca Straits are a potential choke point. They could now suck out oil brought from the Middle East or Africa through Gwadar – thereby reducing their transportation costs – avoiding the circuitous route through Malacca Straits. Alternatively, if Pak turns unfriendly – which is unlikely – they could use their infrastructure built up in Myanmar. They have also burnished their energy security through a “Power of Siberia” project – a $400 billion deal – with Russia to get gas through a pipeline from Siberia to the eastern part of China; the Russians now insist on providing gas through a pipeline across the mountainous Altai region to Xinjiang in Western China that would cost a more modest $10 billion. The Chinese are thus creating various openings to counter a possible choking of their trade routes.
The Chinese initiatives have created shivers in the neighbourhood & beyond. The US finds “unipolar” world architecture threatened & is responding with the “pivot to Asia” strategy centred around India. Russia, which considers the Central Asian region its backyard – its sphere of influence – could lose its leverage in the region – courtesy the “Belt’ project – while the Maritime silk road shall cut the Indian influence in the Indian Ocean Region. The Chinese “string of pearls” strategy of encircling India includes buying influence in Karachi & going forward Gwadar ports in Pakistan, Colombo & Hambantota ports of Sri Lanka, Chittagong in Bangladesh & Sittwe in Myanmar with more friendly governments, now, in Sri Lanka & Bangladesh, we can expect a more reasoned & balanced response. However, the threat on the western front from Pakistan is real & could only flare up further unless a process of re-engaging Pakistan is initiated. Cricket diplomacy would be a good starting point.
“Want to integrate Bharatmala and Sagarmala: Nitin Gadkari (Indian Union minister for road transport and highways and shipping)”
Suggested Indian Response
India should seriously consider connecting the “Bharat mala” project to the Myanmar, Thailand road project & extend it further into the ASEAN for greater economic integration. The SPV announced in Budget 2015 planning establishment of industrial units in Myanmar, Cambodia, Laos & Vietnam should be integrated with such a road project. While China is keen on the BCIM (Bangladesh, China, India Myanmar) road project, India should initiate its own BIM project. Integrating the “Bharat Mala” project to BIM is recommended. The US is keen on a quad-core – US-Australia-Japan-India co-operation – engagement; India should
integrate Vietnam too into the grouping to strengthen the “resistance”. Accelerating the Indian “Spice Route” across 31 countries – Afghanistan, Burma, China, Denmark, Egypt, Eritrea, Ethiopia, France, Germany, Greece, Indonesia, Iran, Iraq, Italy, Jordan, Lebanon, Malaysia, Mozambique, Netherlands, Oman, Pakistan, Portugal, Saudi Arabia, Somalia, Spain, Sri Lanka, Syria, Turkey, UK and Yemen – & the “Mausam” projects is necessary to maintain India’s dominance between the African coast & the Malacca Straits. Finally & most importantly, India needs to correct the perception of being seen as a “bullying big brother” in the region; paradoxically that shall help it in achieving a lasting “leadership” in the region.