Moneycontrol
May 18, 2017 11:50 AM IST | Source: Moneycontrol.com

Why India boycotted China Belt and Road Summit

India yesterday skipped the inaugural One Belt One Road (OBOR) renamed as Belt and Road Initiative summit in Beijing indicating a strong disapproval at the inclusion of the China-Pakistan Economic Corridor (CPEC) that passes through Pakistan-occupied Kashmir (PoK) an area, which India claim as its own territory.

Why India boycotted China Belt and Road Summit

Sandeep Sinha

Moneycontrol News

India yesterday skipped the inaugural One Belt One Road (OBOR) renamed as Belt and Road Initiative summit in Beijing indicating a strong disapproval at the inclusion of the China-Pakistan Economic Corridor (CPEC) that passes through Pakistan-occupied Kashmir (PoK) an area, which India claim as its own territory.

Ministry of external affairs spokesperson, Gopal Baglay in response to query related to OBOR/BRI said:

We had received formal invitation to participate in the 6 separate forums that China is organizing as part of the Belt and Road Forum being held in Beijing on May 14-16, 2017.

We are of firm belief that connectivity initiatives must be based on universally recognized international norms, good governance, rule of law, openness, transparency and equality. Connectivity initiatives must follow principles of financial responsibility to avoid projects that would create unsustainable debt burden for communities; balanced ecological and environmental protection and preservation standards; transparent assessment of project costs; and skill and technology transfer to help long term running and maintenance of the assets created by local communities. Connectivity projects must be pursued in a manner that respects sovereignty and territorial integrity.

India shares international community’s desire for enhancing physical connectivity and believes that it should bring greater economic benefits to all in an equitable and balanced manner. We are working with many countries and international institutions in support of physical and digital connectivity in our own immediate and near neighbourhood.

Expansion and strengthening of connectivity is an integral part of India’s economic and diplomatic initiatives. Under the ‘Act East’ policy, we are pursuing the Trilateral Highway project; under our ‘Neighbourhood First’ policy we are developing multimodal linkages with Myanmar and Bangladesh; under our ‘Go West’ strategy, we are engaged with Iran on Chabahar Port and with Iran and other partners in Central Asia on International North South Transport Corridor. BBIN initiative is aimed at enhancing logistics efficiencies in South Asian region. We are also actively considering acceding to TIR Convention.

Guided by our principled position in the matter, we have been urging China to engage in a meaningful dialogue on its connectivity initiative, ‘One Belt, One Road’ which was later renamed as ‘Belt and Road Initiative’. We are awaiting a positive response from the Chinese side.

Regarding the so-called ‘China-Pakistan Economic Corridor’, which is being projected as the flagship project of the BRI/OBOR, the international community is well aware of India’s position. No country can accept a project that ignores its core concerns on sovereignty and territorial integrity.

What is OBOR?

Chinese President Xi Jinping in 2013 launched an ambitious project named Silk Road Economic Belt which focuses on connectivity and cooperation among Europe, Asia and Africa. The slowdown in the Chinese economy and excess production of steel, cement and machinery that it cannot consumed has forced the Chinese government to search for new markets for its products.

Xi had pledged USD 124 billion in financial assistance for OBOR. It plans to develop six economic corridors across parts of Asia and Europe including CPEC.

Scepticism over OBOR

Experts has doubted serious concerns as major part of the contracts and jobs will be given to Chinese firm and people. There has been serious reservation and protest by people in different countries over the implementation of OBOR.

Debt trap

Analysts have pointed how China is pushing countries in its debt trap by giving loans to countries for unviable projects and increasing Beijing’s leverage. Pakistan is already fallen victim of the Chinese debt trap as it has taken USD 50 billion dollar at the market which is going to balloon to USD 90 billion over a 30 year period.

Similarly countries like Sri Lanka and Cambodia has fallen in the Chinese debt trap. Sri Lanka has borrowed from USD 301 million from China at 6.3 percent for Hambantota Port, whereas soft loans from World Bank and Asian Development Bank comes at 0.25-3 percent. The recent decision by Sri Lanka to hand over 99-year lease of Hambantota Port has caused huge public outcry and 80 percent ownership in the project.
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