STRATFOR REPORT

Apr 19, 2019 | 11:37 GMT

Why the Belt and Road Fuels India’s Fears of Encirclement

    China will continue to expand its Belt and Road Initiative in South Asia because the peripheral nations of the subcontinent feel a need to counterbalance India’s influence as they seek funding for development. 
    India’s opposition to the China-Pakistan Economic Corridor will ensure that New Delhi remains the main holdout against the Belt and Road in Asia.
    Relations between India and China are calmer since their standoff over the Doklam Plateau in 2017, but their rivalry will continue apace given their competing aims in the region.

India might be a large trading partner in its own right, but the designs of the even-larger power on its doorstep is fueling its fears of encirclement. The Belt and Road Initiative, the cornerstone of Chinese President Xi Jinping’s foreign policy to blaze a trail of trade across Asia and Europe, includes five of India’s neighbors: Pakistan, Bangladesh, Sri Lanka, the Maldives and Nepal. But worried that the initiative will grant Beijing undue political influence in neighboring capitals — and that new ports and highways could one day aid China in a military conflict — New Delhi is searching for ways to remain a step ahead of China’s activities in South Asia. For one, India has sought to promote its influence by dangling the prospect of greater investment. In so doing, India has scored a few important victories, but its quest for unrivaled dominance in the subcontinent is ultimately a long shot given the allure of Chinese largesse for the subcontinent’s smaller countries.

China’s Belt and Road Initiative is adding another layer to the Sino-Indian rivalry. By driving China’s expansion into South Asia, the initiative is challenging India’s status as the region’s dominant power. For the nations on India’s periphery, the infrastructure-building program fits into their goals of attracting development funding while balancing against a much larger India. Nevertheless, the detente between India and China following the 2017 Doklam standoff will fail to ease the rivalry so long as both seek to maximize their strength in the region.

The Maldives and Sri Lanka: Islands of Influence

As India and China both aim to secure their growing Indian Ocean trade routes, the competition over island countries like the Maldives and Sri Lanka will heighten. Last year, relations between New Delhi and Male deteriorated when Abdulla Yameen, who was the archipelago’s pro-China president at the time, spurned India’s appeals to restore democracy after declaring a state of emergency. Yameen’s defeat in a September 2018 election, however, provided an opening for Indian Prime Minister Narendra Modi, who lavished the newly elected Ibrahim Mohamed Solih with a $1.4 billion aid package. Returning to a stance more focused on India, Solih is calling for a probe into debt the country incurred under Yameen, including the costs of constructing the China-Maldives Friendship Bridge as part of the Belt and Road Initiative. But even if Male has turned its face back toward New Delhi, the opportunity to benefit from the might of Asia’s largest economy suggests the Maldives’ relationship with China is unlikely to wane appreciably.

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