Once the governmentally driven geopolitical phase of hard infrastructure is over, private companies will take over. If by then Chinese, European or ASEAN companies have taken over major operations, it will be too late for Indian companies to enter.
Various reports indicate that this time again New Delhi has decided to skip Belt and Road Initiative (BRI) summit taking place between April 25 and 27 in Beijing. Close to 40 heads of states or governments are attending the meeting.
These include all 10 ASEAN nations, most Central Asians, Russia, Egypt, Italy, Portugal, Pakistan, Switzerland and the UAE among others. Many others are participating at ministerial or official levels.
Instead of developing a coherent Indian strategy to deal with the Chinese BRI challenge, just not attending a meeting even at a lower level shows a lack of understanding and preparedness.
Negative official narrative about the BRI may also influence Indian private sector not developing strategies to take advantage from emerging opportunities in the neighbourhood.
So far, sovereignty-related issues concerning the China-Pakistan Economic Corridor (CPEC) and broader geopolitical implications within the Indian Ocean region have overshadowed other aspects of the BRI in Indian debates. India’s participation in the Asian Infrastructure Investment Bank (AIIB) and Shanghai Cooperation Organisation (SCO) also seems to have relatively little impact on New Delhi’s perception of the BRI.
While looking at a broader debate in the issue, a large number of independent analysts, including many former senior diplomats in India, have argued for a selective participation in the BRI. This, however, is hardly reflected in government policy.
In the last few years, the Indian focus is more on perusing its own connectivity plans (individually or with other partners) and also on showing how some of the BRI projects are creating difficulties for recipient countries. Although this may be a correct policy course, it may not be enough. Whether we endorse the BRI or not, Indian industry will have to deal with its long-term consequences.
To counter this, it can be argued that no one is stopping the Indian private sector to explore opportunities. However, it is difficult for the risk-averse Indian private sector to go aggressively in areas where government narrative is negative and focus is on difficulties and so-called failures.
Since large numbers of countries and projects are involved in the BRI, it is perfectly normal that some of the projects will face difficulties and failures. However, definitely there will be significant number of successes as well.
Initially in infrastructure projects, Chinese companies might have an advantage. At later stages, others can also be serious players. Precisely for these reasons, many European and Asian countries are looking for economic opportunities created by new infrastructure projects.
Already 60 Chinese cities are now connected through rail with 50 European cities (including 18 Russian cities) in 15 countries. As per Chinese statistics, over 14,000 trains have travelled on these routes since 2011. Frequently exported goods from China through rail include electronics, vehicle parts, machinery, textiles, foods and beverages. Limited imports include wine, tobacco products and automobile spares etc.
Beijing is keen that New Delhi participates in the BRI. With Indian involvement, many infrastructure projects will become more viable. With too much focus on CPEC geopolitics, Indian companies may also be losing sight of positive features of the BRI in some other regions.