Well, that’s the million dollar question, isn’t it?
Don’t lie. You didn’t even know China was doing this before today right? Well, that’s okay. I didn’t know about it until a few months back too, so I guess we share the ignorance gene. Actually, most of India’s population including the overenthusiastic nationalists wouldn’t know that China has been for the better part of the past decade strategically using well-targeted construction loans to gain access to developing countries. Let’s see who these countries are first.
China in partnership with the governments of 60 countries including Pakistan, Kyrgyzstan, Sri Lanka, and yes Russia has started the BRI or Belt and Road Initiative. BRI is a multi-trillion dollar initiative aimed at funding the construction and maintenance of large transport projects in the participating countries. On the surface, the objective of the program is to build modern and well-maintained transportation routes in these developing and hard-to-get-to countries, which can improve existing trade relations and establish new ones. Ultimately the movie is shared economic development, improvement of international relations and of course an increase in trade output activities of the participant countries. Additionally, since the hefty sums of money come with no social and economic restraints at all, developing countries which can’t fulfil the never-ending conditions of World Bank happily accept China’s generosity.
Simple right? With China it never is.
The motive of the Chinese government behind providing financial aid seems humanitarian and philanthropic on the surface, but when we dig deeper, the actual reason comes out. Most of these construction projects are undertaken in developing countries like Sri Lanka, Afghanistan, Laos, Belarus, and Pakistan. These countries although very amiable in accepting China’s generous offer are not at all equipped to pay them back. China, of course, has made the contracts indicating they expect their money returned with great interest. However, given the economic conditions of countries like Pakistan and Sri Lanka, we know the payback is not possible. They are drowned in debt from head to toe. Then what could China possibly be after?
The answer lies in the fine print. When the borrower inevitably fails to pay back the humongous loan, China again very generously -this is a lot of generosity I tell you- nullifies the credit in exchange for certain favours. These favours can go all the way from controlling the lease of the transportation route, whether naval or road, gaining several strategic stations in the country.
Let us look at an example. The flagship project of the Belt and Road Initiative is in Pakistan. In 2015, China built a brand new port in a small fishing town of Gwadar, Pakistan. What’s so special about this small town? It is one of the prominent stops in the ‘Maritime Silk Road’ which China uses to move goods through the naval route from the South China Sea to Africa and further. When Pakistan unsurprisingly failed to pay back the loan it gave control of the port to China under a 43-year lease until 2059.
This not only allows China to use Gwadar port as a respite for its trade ships but also have a military presence in the guise of protecting the trade route. Growing military and naval presence in the Middle Eastern and South Asian countries means China will soon have a firm chokehold on India which it can use should the need arise.
However, that’s not the only construction China is doing in Pakistan. Under the same Belt and Road Initiative, the CPEC or China Pakistan Economic Corridor was built in 2013 with cost estimation of 62 billion USD. CPEC is a land route with 8 lane super expressways connecting Beijing and Pakistan running directly from Xinjiang to Islamabad through Pakistan Occupied Kashmir. The road has been used by China to transport everything from aid to arms and ammunition to Pakistan and further.
Still not suspicious?
The CPEC through Islamabad connects all the way to Balochistan in which lies our unsuspicious town of Gwadar. This means China instead of following the naval route through the South China Sea, and the Indian Ocean can directly send the goods via road to Gwadar and then through the maritime way to Africa saving time and money. This plus a naval and military base in Djibouti, Africa has established a dominating presence of China in the Indian Ocean and Horn of Africa. If you want to know more about this stronghold strategy of China, research on the ‘String of Pearls Theory’.
Another stop in this ultra-important aquatic form of the legendary silk road lies in Sri Lanka smack dab middle of the Maritime Silk Road. This is the city of Hambantota lying on the southern coast of Sri Lanka. In 2013, China gave about 1.5 billion to build a new deepwater port which proved to be a key stop in maritime Silk Road. Sri Lanka unable to pay back approached China and asked for more time to pay back the loan. China, in turn, requested Sri Lanka to give them control over the port under a 99-year lease.
A plethora of these projects have been financed and are either going on or finished in over the world especially the Middle East and South-East Asia countries like Laos, Indonesia, and Belarus. I think it’s more than impressive to see how efficiently China is doing this without anyone even batting an eye while we Indians are left here screaming nationalist slogans. China is setting an economic and political trap around us, and we are debating who’ll win the next election.
Still, think China is your ally? Think again.