China kicks off $79.8 bn Silk Road infrastructure project

China has launched a massive USD 79.8 billion infrastructure project in the northwest province of Gansu which will facilitate trade and people exchanges between China and central Asia as part of its ambitious Silk Road plan.

Though the province does not share its borders with any central Asian countries, it will be an important stretch of the Silk Road Economic Belt, state-run Xinhua news agency reported on Sunday.

The six-year development project will add more than 60,000 kilometres of road, including 4,070 km expressways, and improve the connectivity of the existing transportation network, it said.

The provincial authorities have not released the funding source, but officials said that local government-backed financing vehicle Gansu Provincial Highway Aviation Tourism Investment Group had invested in the project.

Road construction receives fiscal support from the central government. The province is also expected to build 12 civilian airports in the next six years, expanding the reach of its air service to 82 per cent of the province's population, at 25.57 million in 2010.

Since the third quarter of last year, China has approved a slew of transportation projects to boost regional connectivity. It also launched a USD 40 billion fund backed by the country's foreign reserves to support infrastructure building in countries along the Silk Road Economic Belt and the 21st Century Maritime Silk Road. The Silk Road projects involved a maze of roads and ports connecting Asia, Europe and Africa.

China has invited India to join President Xi Jinping's pet project that would revive the ancient trade route by building a wide network of new silk roads on land and seas to enhance global connectivity.

The projects were expected to revive China's trade links specially its sagging exports besides globally enhancing its sphere of influence. India which has been invited to take part in the Bangladesh, China, India, Myanmar (BCIM) and the Maritime Sill Road (MSR) said it will selectively back the initiative.

While India is taking part in the meetings for BCIM, it is yet to give its response on MSR.