Nepal in ‘China’s Belt and Road’

- Sitaram Bhattarai

Presently, One Belt, One Road (OBOR) initiatives has emerged as China’s major policy framework for domestic development and foreign diplomacy with the expectations of addressing the threats on China; achieving long-term economic benefits; reducing the threat of American maritime primacy on China’s trade and energy lifelines; and reconstructing a world order to fulfill China’s interests and predominance. To be implemented the concept shall follow the cooperation principles of joint consultation, joint building and joint sharing, and it aims to effectively promote the establishment of a new landscape of mutual benefit and joint development.

The initiative of Belt and Road has received strong responses across the world since it was proposed by Chinese president Xi Jinping in 2013.  It has outlined on jointly building Silk Road Economic Belt and 21st Century Maritime Silk Road. To understand the new thinking of China’s economic cooperation with foreign countries we require the knowledge about the principles and basic thinking on which its dimensions and perspectives are laid down.

As pointed out by the president Xi Jinping the Belt and Road runs through the Eurasia mainland, links with the Asia-Pacific economic circle to the east, and enters into the European economic circle to the west. Delivering a keynote speech that he has gave in 2015 Boao Asia Forum, president Xi Jinping said, “the building of the Belt and Road shall adhere to the principles of joint consultation, joint building and joint sharing, since it is open and inclusive rather than closed; it will not be a solo of China by itself, but it will be a chorus participated in by many countries along the Belt and Road.” This statement clarifies the initiative of Belt and Road is an idea and initiative about development, and it will adhere to the principles of joint consultation, joint building and joint sharing, and it aims to achieve joint prosperity in the region by means of economic cooperation and people-to-people exchange.

Nepal and India in ‘the Belt’

Nepal also is a part of the project of Belt and Road though it doesn’t touch by the ancient Silk Road. There are 64 countries that will be connected through this project and Nepal is one of them. It can be connected through roads and can get benefit by its component i.e. Asian Infrastructure Investment Bank.  Not only this the initiative of the belt and road encourage China to sign up on Free Trade Agreements with many of these Belt and Road countries.

During the visit of Nepalese Prime Minister K. P. Oli China has showed its interest for Free Trade Agreement with a basic assumption that trade brings security. No need to say China has deep security concern on Nepal and wants to establish new security partnerships through economic ties. It also helps enhance the perception of China threat among relevant parties by increasing common interests. There is an assumption that India is suspicious of Nepal-China connectivity. But the situation is not as in the past, when we had connected with China through two China-Nepal highways. Obviously, India doesn’t like Chinese proactive role in Nepal but if the two countries decide to develop the project, then India have to accept it.

India has welcomed and has shown its intention of active participation in this initiative but it also has many reservations and worries. In order to counter against China’s Silk Road Economic Belt and 21st Century Maritime Silk Road initiative, India recently proposed the “Cotton Route”, so as to strengthen the diplomatic and economic relations between India and the countries in the India ocean rim, and weaken China’s increasingly expanding influence in the region.

India is taking the initiative as both an economic opportunity and a strategic challenge. It believes the initiative of “Belt and Road” may weaken its influences in South Asia but it cannot prevent its neighboring countries from cooperating with China on infrastructure construction. There is pressure to the Indian establishment from the think tanks of its own land not to obstruct China from launching this project in the region. If India want to take mutual benefit than it should actively participate in and influence this action plan so that the ‘China’s version of Marshall Plan’ proved fruitful for the entire region. It has launched Project Mausam and Spice Route as counteractions against China’s Belt and Road initiative. Many people in India perceived the Mausam Project and the Spice Route a rival to the Maritime Silk Road.

Some scholar claimed that India has regarded the initiative as a threat instead of opportunity, and that India is one of the greatest barriers to the Belt and Road initiative. But in fact, for either the Mausam Project or the Spice Route, the Maritime Silk Road is complementary, rather than competing. These routes can reshape maritime trade and improve the regional economic structure. So, the Chinese new project can be a common point between China and India.

China’s grand plan could power the growth of Asia. Institutions like the Asian Infrastructure Investment Bank, of which China, India and even European nations are members, will partly finance the growth of such infrastructure. South Asia can be benefiting through trade connectivity with the global markets and both India and Nepal will be drawn into this mega development framework.

China’s Marshall Plan?

If we look on surface, China may be attempting something similar with Marshall Plan. The inflation adjusted value of $13 billion spent by the U.S. after WWII is roughly $130 billion today. It is the volume of the amount that China is likely to spend on its ambitious project. Though America’s entry into world leadership and its attempt at shaping the world order have a lot to do with a similar initiative, namely the Marshall Plan after World War II, we cannot simply compare the Belt and Road initiative with the Plan because of different contexts and motives. The initiative of Belt and Road and the Marshall Plan have some commonality in providing international aid, in the current situation when the global political ecology and economic development are widely different from those after the World War II, we cannot make a simple analogy between the Belt and Road initiative and the Marshall plan.

The Marshall Plan had ideological pursuit. Because of its economic and military capacity the U.S. was in natural and legitimate situation whereas the Belt and Road initiative is in different context. Western Europe was in compulsion to accept the Marshall Plan Belt and Road countries have a choice. They are in position of accept and reject it. It has launched in times of peace and requires the willingness of countries to support China in building a new regional order. Another notable point is that it is very hard for China to build a regional order excluding the U.S.

Summing Up

The ancient silk-road and the maritime silk-road were two major routes for China’s foreign trade and exchanges. And now, China’s new leadership views the Belt and Road as the most viable diplomatic initiative to address the developing world’s concerns over China’s growing national power. The unusual practice that we perceive today in South Asian economies are free trade agreement in goods and services with nations across the seas but not among themselves. If the project becomes a reality much greater trade among the economies get connected by the infrastructure.

The Initiative surely will create a huge market and plentiful opportunities for the countries along the Belt and Road. It is expected that it will boost the South Asian economies. No doubt Nepal also can get benefit from such economic activities and investment in this region. Who can get the benefit and grasp the opportunities shall be decided by the policy and readiness of any nation. So, Nepal has to be ready to be benefitted.

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