View from the Himalayas | What will come of China's best laid plans?

While Nepal signed the Belt and Road Initiative framework agreement in 2017, Beijing and Kathmandu view the projects differently

The year 2023 marks 10 years since China launched One Belt One Road (OBOR), now known as the Belt and Road Initiative (BRI).

In this file photo, visitors walk past a wall with a map showing the Belt and Road Initiative (BRI) countries, at an exhibition in Beijing, (REUTERS)

The BRI is President Xi Jinping’s legacy project, which over the decade has sought to connect China with the rest of Asia, Africa and beyond through infrastructure projects including ports and railway networks.

Xi announced it as the ‘Silk Road Economic Belt’ during his visit to Kazakhstan in September 2013, less than a year after he was first appointed as the General Secretary of the Communist Party of China (CPC).

At a speech delivered at Nazarbayev University (named after Kazakhstan’s first president, Nursultan Nazarbayev) in Astana, he outlined the new Chinese leadership’s diplomatic priority of accelerating ‘comprehensive cooperation’ with the inland region.

Nazarbayev, a former Soviet Communist party apparatchik, ruled Kazakhstan for nearly three decades until anti-government protests forced him out of office in 2019.

Along with the 'Maritime Silk Road' through southeast Asia, a proposal unveiled by Xi in a speech to the Indonesian parliament later in 2013, the two initiatives – as we know – came to be known as the BRI.

However, BRI has now expanded well beyond Central and Southeast Asia.

By March this year, there were 149 BRI signatories (other than China), encompassing a vast geography – from Sub-Saharan Africa, North Africa, the Middle East, Europe, Central Asia, East Asia and the Pacific, to Latin America and the Caribbean.

Among them are 18 European Union (EU) countries and nine G20 members. Clearly, its scope has grown beyond the Global South.

In South Asia, all the countries except India, have signed up for it. To many, BRI is a not-so-veiled effort at China’s big-power ambitions, and seems to be motivated by Halford Mackinder’s Heartland Theory, which also influenced America’s strategic policy during the Cold War period.

The ‘Heartland’ refers to the Eurasian geography, extending from the Volga in the west to the Yangtze in the east, and the Himalayas to the south and the Arctic to the north: Whosoever controls this territory, according to the Heartland Theory, will eventually emerge as the most powerful state.

Unsurprisingly, the centrepiece of Xi’s foreign policy architecture has drawn analogies with the American Marshall Plan, which led to the successful revival of European economies and infrastructure after the Second World War. But BRI has both proponents and opponents.

Many view BRI projects as a disturbing expansion of Chinese power, which neglects local human resources, local legal and financial regimes and, mostly widely highlighted, that its ‘debt-trap diplomacy’ could result in economic imperialism.

However, many others praise BRI for its potential to boost the global economy, particularly in the resource-starved Global South.

In the case of South Asia, BRI emerged as an attractive proposition to meet the severe fund crunch in infrastructure development. Still, it would be wiser not to view China’s neighbourhood on this side of the Himalayas as a monolith. While all the countries in the region are now BRI signatories, regional power India continues to stay out of it.

But even among the South Asian BRI members, there are notable differences, with Pakistan, China’s ‘all-weather friend,’ being by far the biggest BRI investment destination under the China-Pakistan Economic Corridor (CPEC).

The CPEC comprises several infrastructure projects, dotting a route connecting the far-western Chinese region of Xinjiang to the Gwadar port city in Pakistan’s Balochistan province.

Nepal is a different case study altogether.

Though China’s infrastructure engagement in Nepal has followed a similar paradigm as its engagement in South Asian countries such as Pakistan, Sri Lanka and Bangladesh, there are notable differences, according to a new study released by CESIF (Centre for Social Inclusion and Federalism), a Kathmandu-based think tank, which closely tracks China’s growing involvement in Nepal’s infrastructure development.

There are two significant differences.

One, the magnitude of borrowing and investments in Nepal’s case remains much lower compared to other South Asian countries; second, China’s security relationship with other South Asian countries is noticeably missing in Nepal’s case.

Clearly, Nepal has been treading the BRI architecture very carefully.

On June 21, when the Chinese ambassador to Nepal, Chen Song announced that the newly opened Pokhara International Airport was a BRI project, foreign minister N P Saud quickly pointed out that it was not.

Chen made the remark after the Pokhara airport saw its first international flight, a chartered Sichuan Airlines flight.

Ambassador Chen tweeted that day: “Today, the new Chengdu-Pokhara air route marks a new achievement for the trans-Himalayan multi-dimensional connectivity network between China and Nepal, which is a priority cooperation field between China and Nepal under the BRI initiative.”

Pokhara Airport has hardly been a success story. Though it opened in January, Pokhara has yet to see regular international flights and there are widespread fears that it could turn into a white elephant.

It has been built from a China Eximbank (the state-owned Export-Import Bank of China) loan (worth RMB 1.37 billion) with 25% of the loan provided without interest and the remaining 75% at a 2% interest rate.

Nepal’s official position on BRI has been simple and consistent: Though Nepal signed the BRI framework agreement in May 2017 and discussions are underway with Beijing to start BRI projects, no BRI project has been executed yet under the framework.

After Chen’s BRI claim, foreign minister Saud mentioned in Parliament that a feasibility study of the Kerung-Kathmandu Railway and the Cross-country Power Transmission Line is being discussed.

Saud also stressed that Nepal’s diplomatic efforts are aimed at taking “independent views on international issues based on their merits and demerits,” a clear reiteration of Nepal’s difficult foreign policy choices as a small state in a hotly contested geopolitical space, increasingly dominated by three big powers – India, China and the United States.

How China and other BRI members view BRI could see further divergence in the future. Late last month, Beijing passed the milestone Law on Foreign Relations, which aims at “promoting high-quality development of the Belt and Road Initiative.” The law also allows China “to take measures to counter or take restrictive measures against acts that endanger its sovereignty, national security and development interests in violation of international law or fundamental norms governing international relations.” Many analysts see the new law as a politically significant step in China’s growing assertion in defining its foreign relations and trade ties.

The jury is still out as far as BRI is concerned – 10 years since its launch and six years since Nepal became a signatory.

Akhilesh Upadhyay is a former editor of the Kathmandu Post, and a Senior Fellow at IIDS, a Kathmandu-based think tank. The views expressed here are personal.