BRI: Ten years after

The world struggles to counter its influence

China’s massive Belt and Road Initiative (BRI) completed a decade this month with President Xi Jinping seeking to infuse an element of benignity into this globe-girdling project that is widely seen as a disquieting projection of Chinese power. Mr Xi’s initial vision encompassed creating a vast network of railways, energy pipelines, highways, and streamlined border crossings — overland and maritime — that would promote West and East Asian infrastructure connectivity and the international use of the renminbi. The BRI has made significant strides. To date, according to a Council on Foreign Relations study, 147 countries accounting for two-thirds of the world’s population and 40 per cent of global output have signed on to projects or indicated an interest in doing so.
 

China is estimated to have spent $1 trillion on the BRI, and that includes the $62 billion China-Pakistan Economic Corridor, which has raised concern in India. The flip side became evident by 2020, when several countries faced debt crises. Pakistan, for instance, needed an International Monetary Fund (IMF) bailout after BRI-related imports contributed to a disastrous Budget deficit. Ghana and Zambia saw sovereign defaults, partly because of BRI-related debts. Malaysia cancelled $22 billion worth of BRI projects, citing inflated prices. The intransigent nature of BRI contracts, where credit is extended at close to market rates, and debt cancellation or restructuring rarely included, has been a major impediment. The recent delay over an IMF bailout to Sri Lanka, with China initially proving reluctant to take a haircut, is an example of the pressures on BRI-funding recipients. Critics have also pointed to the fact that nearly half of BRI-related energy spending has been on non-renewable sources.
 

Mr Xi’s speech to the BRI Forum on October 18 suggested an understanding of these negative perceptions. He talked of the “Silk Road spirit of peace and cooperation, openness and inclusiveness, mutual learning and mutual benefit” as the most important source of strength for BRI cooperation. In a message aimed at BRI stakeholders and Western powers, he added: “Viewing others’ development as a threat or taking economic interdependence as a risk will not make one’s own life better or speed up one’s development” and that China stood against “unilateral sanctions, economic coercion … and supply chain disruptions”. Having recalibrated the agenda, Mr Xi announced eight new steps to build the BRI, and they included, among other things, a Eurasian logistics corridor, a 350 billion-renminbi financing window, and collaborations for green energy, AI and tourism. A BRI secretariat would also be set up.
 

This reset and expansion come at a time when the US and the European Union (EU) have launched competing versions of the BRI. In 2021, the G7 launched the Build Back Better World Initiative (B3W), and this month, the EU announced the Global Gateway Programme (GGP). B3W, renamed Partnership for Global Infrastructure and Investment, is a pale imitation; it has spent just $6 million so far. The GGP is riven by differences among member-countries, several of which also have BRI-related projects. For India, the India-Middle East-Europe (IMEC) corridor, announced at the New Delhi G20 summit, was seen as one potent counter to BRI influence in West Asia. Now, with the Israel-Palestine war, the IMEC looks like a non-starter for the foreseeable future. So countering China’s new-look and expanded BRI will be a fresh geopolitical test for New Delhi.