Raja Mandala: India’s China reset and BRI

Raja Mandala: India’s China reset and BRI

 Context

At the annual Boao forum in Hainan this week, Chinese leader Xi Jinping is expected to present himself as the new champion of globalisation and castigate the unilateral economic actions of US President Donald Trump

 New economic leader

China might project itself as new global economic leader amidst US’s unilateralist policies

 India doubtful on China’s intentions

Trade deficit with China: Due to huge trade deficit with China, around $52 billion, and no efforts from Chinese side to reduce it despite Indian concerns.

BRI issues: China-Pakistan Economic Corridor (CPEC), the flagship project of the BRI, violates India’s sovereignty in Kashmir. BRI projects are pushing recipient countries into indebtedness, do not transfer skills or technology and are environmentally unsustainable

 Indian efforts to promote connectivity with neighbors

• Chabahar port project in Iran and the agreement on building a rail link to Kathmandu
• India is also in discussion with Japan and the US to pool resources and coordinate approaches to sustainable infrastructure development in the Indo-Pacific

 Working jointly is beneficial for both India and China

Improving viability: The viability of the projects would significantly improve if there is cooperation between India and China, for e.g.

• The financing for China’s hydroelectric projects in Nepal would be lot easier if the power plants are linked to North Indian markets
• Similarly, the proposed Indian and Chinese rail lines in Nepal would be more efficient if they are part of sensible trade and transit agreements between Delhi, Kathmandu and Beijing

Huge size of Indian market: The Subcontinent’s geography and the size of India’s market make it plain that many BRI projects will be hugely successful if India is part of them

Current stand

India: The NDA government might be quite open to a substantive dialogue with China on BRI if Xi is prepared to address Delhi’s concerns on sovereignty and sustainability

China: Beijing, in turn, has apparently floated a number of new proposals for Delhi’s consideration.These include extension of the CPEC to India, promoting connectivity across the Himalayas in J&K, Nepal, Sikkim and other places.

What is Boao forum (BFA)?

The Boao Forum for Asia is a non-profit organisation that hosts high-level forums for leaders from government, business and academia in Asia and other continents to share their vision on the most pressing issues in this dynamic region and the world at large

Modelled after WEF: BFA is modelled on the World Economic Forum held annually in Davos, Switzerland

Its fixed address is in Bo’ao, Hainan province, China, although the Secretariat is based in Beijing.

Asian Davos: The forum, sometimes known as the “Asian Davos”, takes its name from the town of Boao, located in China’s southern Hainan province, which has been the permanent venue for its annual conference since 2002.

The Forum is committed to promoting regional economic integration and bringing Asian countries even closer to their development goals.