Centre outlines plan to counter China's Belt and Road Initiative, offers soft loans

India outlined its rebalancing strategy to counter China's Belt and Road Initiative (BRI), offering soft loans for various development and capacity-building projects across continents, according to a report by The Economic Times.

V Muraleedharan, Minister of State for External Affairs, in response to a query in Lok Sabha, said India has a robust development cooperation agenda, constituting a significant dimension of its close and multi-faceted ties with many partner countries, including in India’s neighbourhood.

“Extension of Government of India (GoI) Lines of Credit (LOC) on concessional terms is an important component of this development partnership in diverse areas of socio-economic development such as power, transport, connectivity, agriculture and irrigation, manufacturing industries, water and sanitation and healthcare,” the minister said.

A total of 279 LOCs have been extended to 63 countries of Asia, Africa, Latin America, Caribbean, Oceania and Commonwealth of Independent States worth nearly $28 billion, the minister told Lok Sabha.

India's stance on BRI has also been clear. “The inclusion of the so-called ‘China-Pakistan Economic Corridor’ (CPEC), which passes through parts of the Indian state of Jammu and Kashmir under illegal occupation of Pakistan, as a flagship project of ‘OBOR/BRI’, reflects lack of appreciation of India’s concerns on the issue of sovereignty and territorial integrity,” he said.

Muraleedharan added that the Centre is of the firm belief that connectivity initiatives must be based on universally recognized international norms. They must follow principles of openness, transparency and financial responsibility and must be pursued in a manner that respects the sovereignty, equality and territorial integrity of nations.

China has been often accused of a non-transparent financing model for their BRI project, leading to a debt trap for certain countries due to loans offered by the Chinese.