Expert Interview on China’s OBOR – Maj Gen Rajiv Narayanan, New Delhi

“India is ready to work with China for the larger good of the region”

Jennifer Loy interviews Retired Major General Rajiv Narayanan from India, Distinguished Fellow at the USI of India, on China ’s OBOR/BRI and the motivations behind it.

Q: In a simple way, can you explain China’s One Belt One Road (OBOR)/Belt Road Initiative (BRI)?

A: It is the deployment of the Chinese overcapacities of their factories and their labor to enable China’s growth. Concurrently, it plans to utilize this opportunity to gain geo-strategic space in Asia, especially East, SE, South and Central Asia.

Q:Do you believe Xi Jinping’s intentions are truly economic and almost nation-building, or do you think there are military motives as well?

A: Xi Jinping’s intention are purely to gain geo-strategic space using the geo-economic squeeze / ‘debt-o-nomics’ to ensure that it garners enhanced space for PLA to sustain itself well beyond its borders, viz., Gwadar, Hambantotta, Djibouti.

Q:The BRI is an incredible endeavor, a modern Silk Road.  How is the Chinese government funding this project?

A: The BRI is not something that was started by Xi Jinping. Most of these projects were on going under Hu Jintao, and a few under Jiang Xemin, viz., Hambantotta port construction began in 2009. Xi Jinping has coined this phrase and clubbed all these ongoing projects under one umbrella. Anyway, the Silk Route was not one road but a multiplicity of roads, connecting China, Central Asia, South Asia and West Asia. Under the umbrella of BRI, only one corridor, the China – Central Asia – West Asia corridor corresponds to the ancient Silk Route.

Q: How do the Chinese people view such an extensive project?

A: The common man is only able to read what the government wants him to know. The media and internet censorship within China is very harsh. As such he / she can only mouth what the Communist Party of China wants them to know.
Q: BRI projects would truly benefit the host nation if locals are employed.  Where are examples that they have been?

A: The BRI project is to provide jobs to the Chinese and not to the host countries. Very limited labor is being utilized from the host country – the CPEC is a classic case in point.

Q: In Xi Jinping’s first address to the UN in 2013, he stressed, “We should build partnerships in which countries treat each other as equals, engage in mutual consultation, and show mutual understanding.”  What can you say to this in terms of the BRI?

A: What XI Jinping stated was only meant for media consumption and for the US and West to treat China as equals. The manner in which the BRI has been invoked, and made part of the Constitution, tells the story. No host country was even consulted. India has never coveted another country’s territory, but China creates issues by specious territorial claims and creeping assertiveness – as it has done in the South China Sea. Post the 1962 fiasco, India has learnt its lessons, and the in subsequent border battles in 1967 in Sikkim China was decisively defeated. Similarly, in 1987 when China tried to create an incident in Arunachal Pradesh (Sumdurong Chu), it was surprised by India’s response and China blinked, pulled back and it led to the meeting between Den Xiaoping and PM Rajiv Gandhi. The Doklam standoff in Bhutan is a lesson to the major powers that if it militarily supports a smaller nation it can stand up to China’s arm-twisting, like Bhutan did with India’s support.

Q: India appears to be losing influence in Nepal, Sri Lanka, and the Maldives.  What do they need to do to regain this, or should they wait and see how the BRI aids the region?

A: Loss of influence depends on long term interests, and that I do not think will change in any of the three countries. Though temporarily it may seem so, the economic dependency cannot be wished away. All three understand that trade with China is not a viable option, but as with any country, they would prefer to hedge between two major countries to maximize the gains for their country.

Q: A couple months ago, India and China “reset” their relations. Was this for show or do you think it has worked?

A: China seems to understand that in the near to medium term, rapprochement with India would be a win-win for all. The two major powers in Asia need to work together and build on the convergences rather than allow the divergences to create sensitivities that could lead to avoidable contest. As such, India is ready to work with China for the larger good of the region.

Q: It appears Nepali Prime Minister Oli is interested in increasing relations with China.  Besides China Telecom Global and a Beijing funded railway into China, what other projects will Nepal benefit from with the BRI?

A: No corridor of the BRI touches Nepal. So, at best Nepal can look towards a link that could then connect it to the Central Asia-West Asia corridor. Any infrastructure needs to be economically viable to be able to repay the loans provided for executing the same. Hence, the projects that China proposes needs to be closely scrutinized for its economic viability. Accordingly, Mr Oli, Nepal’s prime minister, has stated categorically that concurrently he desires to maintain good relations with India also.

Q: How far do you think Sino-Nepali relations can extend before India intervenes, perhaps militarily?

A: Why would India intervene militarily at all? Nepal has very close relations with India, and it still continues. The Nepalese do not need any visa to visit India, or any work permit to take up jobs here. This will continue. So despite good relations with China, Nepal will also maintain its traditional relations with India – it’s not a zero-sum game.

Q: In 2017 at the World Expo in Astana, Kazakhstan, the China Pavilion was concerned with clean, green technology. How have they already taken steps to implement this within the BRI?

A: It does not seem so, as is evident from the projects planned for CPEC. Pakistan currently is electricity grid based on gas fired technology – considered rather green; but the energy grid being made by China is mostly Thermal that is not green.

Q: Chinese tourists make up the largest percentage in the Maldives.  How will the BRI improve the Maldivian economy besides tourism?

A: The BRI will not improve Maldivian economy, since the infrastructure costs are not covered by the visiting tourists. Thus if Maldives goes ahead with executing projects without any assessment of their economic viability,  it could also end up in a debt trap like Sri Lanka and Myanmar (Pakistan?).

Q: Besides the 99-year lease on the Sri Lankan port of Hambantota, how else will the BRI affect the island nation?

A: The nation is already in a debt trap. It needs to carefully weigh the fine print for the other projects that China has proposed around Colombo.

Q: The landlocked Kingdom of Bhutan is secluded and unique because of its geography as well as its environment and lifestyle.  Will the BRI affect it?

A: No. It has no connectivity with China. The Nation does not look at GDP but at Gross National Happiness (GNH).

Q: Bangladesh is often a forgotten South Asian nation.  It is poor and suffers from great infrastructure concerns and it would greatly benefit from the BRI.  Are there any such projects?

A: The India – Bangladesh – Myanmar – China project that was already in place had been unilaterally subsumed by China into BRI, which India has objected too. China is going slow on this project. However, due to the debt issues being faced by Sri Lanka and Myanmar, Bangladesh is wary of projects with China and is carefully selecting only those that would be economically viable to it.

Q: What are the prospects for Gwadar and Kyaukphyu as Indian Ocean ports for China to decrease sea shipping?

A: Neither would reduce China’s maritime trade footprint.

Q: How is the “China Model” affecting nations in Africa?

A: The ground swell against ‘China Model’ of exporting its men and material for execution of projects is rising.

Q: The BRI will extend to Europe eventually. Explain those that are and are not interested and their reasoning.

A: The extension of BRI to Europe is basically for optics and is not economically viable. The train from Yuili (Eastern Seaboard of China) to UK took 21 days and carried 200 x 20 ft containers. There were 11 x transshipment involved. Due to this, in a month only about 10 trains can run in a month, i.e., 2000 x containers can be shipped to UK. Compared to it the larger container ships can carry 12000 x 20 ft containers with almost 20 x ships being handled in a month, i.e., 240,000 x containers can be shipped in a month. The economics are stark.

Q: Xi described the BRI as a “win-win” for the nations involved.  I understand it is too soon to truly tell.  Regardless, what needs to happen for it to be a “win-win” for those involved?

A: As has emerged from the experience of both Sri Lanka and Myanmar, the win-win appears to be only for China – win in the near term and another win in the medium to long term. In the near term it gains space and in the medium term with geo-economic squeeze due to debt it gains geo-strategic space.

Jennifer is Research Associate at Nepal Matters for America in Washington.

Image source: Tibetan Review (customized)


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