The Bangladesh–China–India– Myanmar Forum for Regional Cooperation (BCIM), which would also connect China’s Yunnan province to the Bay of Bengal (BOB) and the China-Pakistan Silk Road Economic Belt, which is a railway project that would connect China’s Kashgar to the Gwadar port in Pakistan.
By Mohammad
Humayun Kabir and Amamah Ahmad
In order to
understand the complexity of China’s strategic situation, one needs to take
into account its remarkable economic growth over the last decades. In just over
a single decade, China’s foreign trade went from $289 billion dollars to an
astounding $2.560 trillion in 2005 (Eshel 2011).However, one main commodity
that Beijing lacks is oil. Today, the country is the second largest global oil
consumer.
In order to sustain its economic growth, China’s strategic priorities
are to find reliable oil supplies and secure unencumbered SLOCs. These
expanding economic and strategic interests may cause the PLAN to operate out of
area in order to safeguard investments and SLOCs. This explains China’s focus
on military facilities along the SLOCs from China to the Persian Gulf (Eshel
2011). Below table gives us a better idea of China’s presence in the littoral
nations.
As other powers shift their focus, Beijing is also focusing on its “Look South” approach. In 2013, President Xi Jinping suggested two initiatives, the Continental Silk Route and the Maritime Silk Route. The initiatives would extend China’s influence in two belts: The Bangladesh–China–India– Myanmar Forum for Regional Cooperation (BCIM), which would also connect China’s Yunnan province to the Bay of Bengal (BOB) and the China-Pakistan Silk Road Economic Belt, which is a railway project that would connect China’s Kashgar to the Gwadar port in Pakistan (Jia 2014). These initiatives would fulfill the purpose of greater connectivity in the region for Beijing.
The
qualitative analysis of China’s outward investment strategy reveals three kinds of big projects:
(1) Those that
very clearly serve an economic purpose;
(2) Those that
do not serve an economic purpose and are more likely to buy influence with the
host country’s government; and
(3) Those that
serve economic and geopolitical interests.
The Chinese
banks that finance these projects and the Chinese firms that work on them are
almost uniformly state-owned enterprises, and the workers and materials used in
these projects are often exclusively Chinese. Thus, economic and geopolitical
considerations seem to motivate China’s investment in projects.
Chart Attribute: China’s Share of Exports from Bangladesh,
Nepal, and Sri Lanka, 2003-2011. China’s
Increased Trade and Investment in South Asia (Spoiler Alert: It’s The Economy)
Prepared for the U.S. Government Office of South Asia Policy , 2013
In addition to
Beijing’s quest for energy and connectivity, this orientation has been also
triggered by China’s uneasiness of the US “Re-balancing” strategy. In response,
China has continued its naval build-up which has seen an exorbitant 500% rise
since 2000 (Jha 2014).
Consequently,
current Chinese maritime policies are intended as a warning, especially to the
US, not to intervene in Chinese affairs, especially in the South China Sea
(SCS). Parallels can be made here to the US Monroe doctrine, declared in 1823
to deter European powers from meddling in seas the US considered as its natural
sphere of influence (Yoon 2014).
Chart Attribute: Error Terms
for Trade Flows between Focus Countries and China / Source: China’s
Increased Trade and Investment in South Asia (Spoiler Alert: It’s The Economy)
Prepared for the U.S. Government Office of South Asia Policy , 2013
Interestingly,
China is playing two different games in two different seas. In the SCS, where
China is a littoral nation, there is a strategic competition with the US and
rival Asian nations – China is allegedly defying the international law of the
sea by continuing to patrol and police near ASEAN countries (CNAS 2009). This
tense geo-strategic area is China’s foreign policy priority, as conflicts here
are mainly related to its territorial sovereignty.
Very recently,
president Xi Jinping officially declared China’s intention to strengthen its
frontier defences on land and sea. He also called for the country to boost its
military into a force that can “win battles” (Daily Star 2014). As a result,
the People’s Republic of China has adopted a
strategic approach that includes land, maritime, economic and energy security
components (Rajan 2014). The naval build-up has added a new dimension to the
PLAN’s capabilities– going from that of conducting coastal defence activities
to the potential of high sea defence.
For a long time,
China had given primacy to land security. In the 1980s when China began opening
up, new economic linkages were complemented by greater dependence on sea lanes
for export and import of goods and oil respectively (Bedford 2009).
Additionally, with the fall of the Soviet Union, China could stop focusing on
its land border and turn its attention toward the sea.
Securing SLOCs
has become one of its main objectives and a way to address the "Malacca
Dilemma" and reduce its reliance on the Malacca strait through which about 80%
of its energy import is transported. This makes Beijing’s energy security
vulnerable because of the US’ objective to control the Strait and because of
pirate attacks. China is therefore exploring other options, which would allow
it to bypass the Strait, by transporting resources through roads and sea from
the BoB (Stratrisk 2013).The Chinese-built gas pipeline from Kyaukpyu in
Myanmar to Kunming, which became operational in 2013, with a parallel crude oil
pipeline, is one such project (Samaranayake 2014).
"Sri Lanka" Factor:
The Hambantota
Deep seaport has received a great deal of attention in the media, and a number
of Indian security analysts have voiced concern over the port’s close proximity
to India (Bajaj 2010). However, economic and geopolitical concerns are not
always mutually exclusive. The Hambantota Deep Seaport may be an example of
China acting with its economic and geopolitical goals in unison.
Located on
strategic Asian and European sea lanes, it can serve as a refueling station for
commercial as well as military vessels. Moreover, the ability to dock, repair,
and refuel strengthens China’s logistical capabilities to ship oil from Iran,
Saudi Arabia, and Sudan, thereby increasing China’s energy security. The port
also further facilitates trade with a country that is increasing its imports
from China, and it is in China’s economic interest to have further commercial
access not just to Sri Lanka, but to other surrounding countries as well.
Finally, the Sri Lankan president has stated publicly that the port is
intended for commercial purposes only and will remain so (Kostecka 2010).
Other
projects, such as the Mahinda Rajapaksa Cricket Stadium and the Lotus Pond
Theatre seem more designed to curry favor with the Sri Lankan government. These
projects offer little economic utility to China and mirror projects that China
has funded in other countries as part of its diplomacy-through-aid strategy.
For example, China also built cricket stadiums for Dominica, Grenada, and St.
Lucia following their switch in diplomatic recognition from Taiwan to the
mainland (Lum 2008). China gifted the Lotus Pond Theater to Sri Lanka.
The theater
offers no economic returns, although Chinese workers constructed the theater
using Chinese materials (Sunday Times 2011). Instead of purchasing an economic opportunity,
these projects are better explained as being used to purchase positive
relations with Sri Lanka.
"Bangladesh" Factor:
The Chittagong
port directly borders Northeast India and, like the Hambantota Deep Seaport in
Sri Lanka, has raised suspicions in India that China is trying to encircle
India and increase its ability to project military power into the region.
(Bajaj 2010). Like the Hambantota Deep Seaport, these suspicions can neither be
confirmed nor rejected. China has markedly increased its trade with Bangladesh
and has a vested economic interest in gaining further commercial access to
Bangladeshi markets. Additionally, Bangladesh’s president has publically stated
that the port is intended solely for commercial purposes (Kostecka 2010).
Image Attribute: Bangabandhu International Conference Center, Dhaka, Bangladesh
The eight
so-called “friendship bridges” China has built throughout Bangladesh do not
seem to offer much economic utility to China. China funded these bridges to
celebrate improved diplomatic relations with Bangladesh; Chinese state media
say their construction is “to express the Chinese people’s friendship to the
Bangladeshi people.” (People’s Daily 2012). Likewise, the Bangabandhu
International Conference Center (also known as the “Bangladesh-China Friendship
Conference Center”) does not seem to provide many economic returns to China.
Therefore, “dollar diplomacy” likely explains this project better than sound economic
investment.
"Myanmar" Factor:
Map Attribute: Sino-Myanmar
Energy Pipeline Map
Myanmar’s Nay
Pyi Taw holds great strategic importance for China due to its energy
endowments. The pipelines through Myanmar have the potential to help China
reduce its heavy dependence on the Strait of Malacca for the transportation of
energy. This, of course, has strategic implications against the backdrop of the
United States’ rebalancing in Asia and the on-going maritime disputes in the
SCS. The successful building of the pipelines through Myanmar could reduce
China’s dependence on the Strait of Malacca by 30% (Melkulangara 2013).
Conclusion:
Finally, be it
energy needs or strategic motivations, China’s commercial and infrastructure
investment in the region have been astonishing. It has offered the BoB nations
billions of dollars in loans for the construction of ports and roads and for
other infrastructure projects, ensuring its influence in and around the Bay
(Samaranayake 2014).
For instance, Beijing has been deeply involved in
countries like Sri Lanka, where it has contributed approximately $4 billion in
loans, grants and aid since the end of the civil war in 2009 and is responsible
for almost 70% of the country’s infrastructure projects (Columbage 2014).
Currently, China and Bangladesh are also in talks over the $9.03 billion worth
of financial support that the latter requested from Beijing (mostly for
infrastructure development projects over a period of five years) (Kabir 2014).
On the regional scale, in November 2014, China offered $20 billion in
preferential and special loans to develop infrastructure and increase
cooperation with its South East Asian neighbours (Shannon 2014). All these
examples reflect the Asian Giant’s stronghold over the sub regions.
As China seeks and materialize the port access agreements with littoral countries of the Bay of Bengal, India is also extending its sphere of influence east and west on land and at sea, there is a possibility that it will ‘bump heads’ with China which is protecting its interests and is expanding its reach in the region.
About The Authors:
Mohammad Humayun Kabir is
Senior Research Director at the Bangladesh Enterprise Institute in Dhaka,
Bangladesh, and head of its Foreign Policy and Security Studies Division. He
studied International Law in Kiev State University, Ukraine, and International
Relations at Oxford University, UK.
Amamah Ahmad is a Research
Associate at the Bangladesh Enterprise Institute in Dhaka, Bangladesh. She
graduated with a Bachelor of Arts in Social Science and a Master of Arts in
Political Science from the University of Lausanne in Switzerland. She has
research interests in Geopolitics, International Security and Transboundary
issues.
Publication Details
Citation
Information: Croatian International Relations Review. Volume 21, Issue 72,
Pages 199–238, ISSN (Online) 1848-5782, DOI: 10.1515/cirr-2015-0007, March
2015.
© 2015. This work
is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives
3.0 License. (CC BY-NC-ND 3.0)
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