The One Belt One Road Initiative in China

The Chinese are laying out a grand economic design aimed at global supremacy. The One Belt One Road initiative is just a part of it and it is the Project-of-the-Century as described by China’s leader Xi Jinping on May 14, by laying out his grand plan to remake the world order. Xi unveiled his pet initiative One Belt One Road initiative which seeks to establish Beijing at the centre of the world through a series of massive infrastructure projects linking China with the rest of the world. India was the only major absentee from the OBOR summit as the opacity surrounding China’s goals coupled with India’s concerns over Chinese ambitions in the POK.

If OBOR was so named with the hope of signaling the world about the China’s benign intentions, the country’s leading thinkers are aware that more is at risk. Through OBOR China is for the first-time staking claim to be a global leader in with comparison to the USA. Chinese thinkers believe that China has two option available a) Trade protectionism and b) To guide globalization into a new phase and form a new economic and world order. The first alternative takes the world back to square one which is unthinkable. The Chinese are at the historical turning point and must embrace this new phase. China’s push for global supremacy didn’t begin with the OBOR but it has emerged as the instrument through which China is making its intentions clear. For the two decades China is pushing its state-owned enterprise to go out to secure the country’s interest like for railways in Africa, acquiring and operating mines all over the world from Latin America to Afghanistan and constructions of dams from Argentina to Myanmar. What China is trying to do and to some extent has achieved success in doing.

More than his predecessor Xi has been more aggressive in campaigning China’s role globally. After taking his office in 2012 he gave a slogan “China’s Dream” of the great rejuvenation of the nation. Every leader since Sun Yet Sen has spoken of china’s revival but its Xi has pushed more than anyone. The key word in this revival is and it gets to the heart of what China is now trying to do with its foreign policy. It means securing China’s interest which in turn projecting China as a great nation at the world stage. It is no surprise that its leader see their economy and traders as key to their global mission.

In 1996, the leader Jiang Zemin pushed what were then called a “Going-Out” strategy for state owned enterprise. In 2001, China accounted for less than 5% of global trade but today it is the world largest exporter of about 14% share. Now it is the largest trading partner for more than 100 countries and has emerged as the biggest source of FDI from Venezuela & Angola to Nepal and also EXIM bank are funding this investment and lending more in Africa.

Gabbing up their resources, China is today the world biggest producers and consumers of everything from coal & iron to copper and rare earth. The Belt and Road plan was first unveiled as a land “Silk Road Economic Belt” by Xi during 2013 on his state visit to Kazakhstan. It is doing in 3 ways that will bring market closer, by setting up project overseas and through massive lending. For instance: to reduce reliance on Malacca Strait, China has opened a new pipeline with Myanmar connecting to Kunming. Pakistan’s Gwadar port in the Arabian Sea has been conceived to open up alternative access to different sea ports. In China, it is said ’in order to become rich, it is by building roads and bridges’ whether this plan will work is far from certain. Top Chinese economists have expressed fear that PRC is overextending itself. In some countries, the debt burden is increasing and impossible to finance for governments, which are also facing criticism because Chinese companies are given all contracts. Chinese companies can suffer from defaults. Xi Jinping says rather than carrying out reforms to privatize the state sector, OBOR is designed to overcome overcapacity by exporting machines, steels and cement.

Sri Lanka is among the debt struggling nation to repay the loans. Miller says some policy makers in Beijing estimate that China is likely to lose 80% in Pakistan, 50% in Myanmar and 30% in Africa. The USA with its superior military remains the world superpowers but as Beijing commercial interest overseas expands rapidly, it will naturally have greater stakes globally. Opening of base in Djibouti and opening of Hambantota Port in Sri Lanka and Gwadar Port in Pakistan. The projects Beijing says are purely economic but it is no coincidence that China is accelerating the expansion of its Blue Water Navy.

Through OBOR and CPEC, China is expecting almost every aspect of its development model to Pakistan. It is clear that the entire initiative is China-Centric and China-led. China tries to show the jointness but only from one side. No wonder India boycotted the summit of OBOR. The decision also factored in China’s unwillingness to address its concerns on CPEC which passes through POK. Delhi also faces the most difficult challenge of responding to rising Chinese influence by offering an alternative by opening its market and integrating with the neighborhood.

India needs to focus on delivering of existing commitments because that is the place where China scores the maximum points. But it is not in Delhi’s interest to allow relationship to degrade into outright hostility. Delhi will be continuing involving itself with Beijing and also building closer relationship with Japan and Australia. International perception will only change once India is seen narrowing the gap with China.