Aside from the fundamental difficulties and challenges inherent to Chinese strategies in the surrounding regions, there is also the matter of the opposition or at least wariness of regional polities towards Chinese foreign policy in general and the BRI in
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particular. These include not only regional rivals and concerned parties in North Asia, Central Asia, and South Asia, but also further afield in the Middle East and in Europe.
All of these are within the scope of the BRI, and all of them have various reasons either to be concerned over Chinese policies or be worthy of Chinese concern with regards to the pursuit of such policies.
The most evident opponent to the BRI to date is India, for which the MSR specifically is a significant strategic concern. This has been marked by increased Chinese PLAN activity in the Indian Ocean region; increasingly close ties with Sri Lanka, traditionally considered within India’s sphere of influence, to the point where PLAN vessels docked at Sri Lanka civilian ports at Colombo in late 2014; increasingly close Chinese ties with Pakistan, with whom India shares an acrimonious relationship; CPEC projects under the BRI framework that pass through disputed territory, specifically Pakistan-occupied Kashmir. As a more direct response to this state of affairs and towards the BRI, India boycotted the Belt and Road Forum, which the Chinese government sought to downplay and blame on Indian geostrategic paranoia (Connor, 2017). The Indian Ministry of External Affairs in turn raised concerns about the BRI creating an
“unsustainable debt burden” for areas within the initiative’s scope, pursuing its own “Go West” and “Act East” strategies (Indian Ministry of External Affairs, 2017).
Fundamentally, the issue is less about whether or not the Chinese have any deliberate strategy similar to the “String of Pearls” theory, but whether or not India perceives China to have similar or other designs disadvantageous to India.
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While India is upgrading its defense capabilities, particularly in anti-submarine weapon systems clearly meant to counter Chinese submarines, India has several other limited leverages that may allow it to oppose the BRI. Its “Act East” policy, transformed in 2014 from a previous “Look East” policy, has consolidated relations with ASEAN states and Japan. Although the ASEAN response is less coherent, these three political entities have been wary of Chinese regional ambitions (Sajjanhar, 2016). India in particular is pivoting towards a stronger alignment with Japan in responding to Chinese activities in the region, such as establishing competing infrastructure projects against Chinese bids under the MSR banner (Bajpaee, 2016). There are, however, limits to the effectiveness of this strategy. The ASEAN community is at various stages of industrialization, is moving increasingly from complementing to competing with China’s economy, is developing their own low-cost manufacturing infrastructure to attract foreign demand previously invested in China, and is also making moves towards domestic consumption (Salidjanova & Koch-Weser, 2015). This means the region is not as desperately in need for foreign investment compared to the Central Asian states along the SREB for its infrastructure projects. Similarly, Chinese infrastructure deals in Southeast Asia under the BRI are more limited, restricted largely to railway deals compared to the ambitious port projects in Colombo and Gwadar, the trade centers in Khorgos, the power facilities in Pakistan, and the oil pipelines across Central Asia and the Middle East.
Competition with India over the Southeast Asian market is not a crisis for the BRI. And in spite of India upgrading its navy to consolidate its position in the Indian Ocean region, existing cooperative frameworks between China and India make it difficult for New Delhi to threaten Chinese energy imports in the Indian Ocean over the MSR. Disputes
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over the extent of China’s influence over Sri Lanka may be a more significant worry, but indications thus far are that Sri Lanka remains under India’s sphere of influence (Aneez
& Sirilal, 2017).
India’s “Go West” strategy, not to be confused with the Western Development Strategy that also colloquially known as “Go West”, may be a source of competition against Chinese interests in Iran. This includes the International North-South Transport Corridor (INSTC) that sees an economic corridor from India that stretches through Iran and the Caucasus, and into Moscow; and the Iran-Oman-India pipelines across the western Indian Ocean (Chatterjee & Singh, 2015). Central to these efforts is Indian investment into Chabahar Port in Iran, considered an Indian alternative to China’s reliance on Gwadar in Pakistan. As Pakistan denies Indian overland routes to Central Asia, Indian is instead relying on naval power to connect to Iran, and then using Iran as a springboard for its “Connect Central Asia” (CCA) policy (Putz, Why Is India Hopeful About Iran and Central Asia?, 2015). Furthermore, it is attempting to engage in negotiations with the EEU to develop a comprehensive economic relationship (Chatterjee
& Singh, 2015). This engagement with Central Asia, especially if India continues to refuse to join the BRI framework or perhaps even oppose it, is likely to be the most significant risk to the BRI’s objectives from India in terms of the Xi administration’s policies as proposed in this thesis.
There are also economic avenues that India has access to that may directly influence the BRI. One of the sources of funding for the initiative is the AIIB, in which
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China maintains control through 30.3% of the bank’s shares and thus 26.1% of the banks’
votes. However, although a distant second, India still commands a respectable 8.5% of the bank’s shares and thus 7.5% of the vote (Federal Council of Switzerland, 2015). This could have limited but potentially consequential implications for China’s ability to fund the BRI. Furthermore, India has leveraged against the BCIM Economic Corridor as recently as 2017, which had been agreed upon prior to the formation of the BRI, and which India is resistant towards including under the BRI banner (Kantha, 2017). This opposition has manifested in stalled projects along the economic corridor, and may also threaten the position of India-leaning Bangladesh in the project (Iyer, 2017). But this is still a region where Chinese investments are limited, and where the BRI is less exposed to the consequences of failure aside from the loss of face from failing to bring one of the proposed economic corridors of the BRI to fruition.
Aside from India’s limited potential setbacks to the BCIM Economic Corridor, however, there are reasons why these risks from India may be limited. India’s dependence on Iran to access the Central Asian market is constrained by China’s attempts to also create deals with Iran with the BRI, which is developing at a much faster pace, as seen from China’s attempts to extend its oil pipelines from Central Asia to the Middle East. This may not actually shut out India’s Go West or Connect Central Asia policies, but it can diminish the leverage by which India may challenge the BRI, especially since China’s trade volume is already significantly higher than India’s in both Central Asia and East Africa, with a Chinese trade volume of US$18 billion in Central Asia to India’s US$950 million in 2015, diminishing the chances India can challenge China’s entrenched
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position in these regions (Watson, 2017). It may also find itself reluctantly drawn into the BRI’s orbit due to China’s trade dominance in the area, existing frameworks such as the SCO and the BCIM Economic Corridor, and India’s negotiations with an allegedly BRI-friendly EEU.
Russia has also been wary of increasing Chinese influence into Central Asia, historically considered part of the Russian sphere of influence, especially with their increasingly unequal relationship (Singh, 2015). The Russian-led Eurasian Economic Union meant to tie Central Asian economies with the Russian economy has been met with starkly limited success, especially in relation to the BRI, and Central Asia is looking increasingly towards China for economic benefits (Putz, China’s Silk Road Belt Outpaces Russia’s Economic Union, 2016). While Beijing has public encouraged Moscow to integrate their plans with the BRI, Russia has reason to be concerned about what certainly seems to be an increasingly unequal relationship between the two major powers. Publicly, Russia supports the BRI and has fostered warmer relations with China, but this has largely been a result of strategic decision-making following the Russian economic slowdown as a result of Western sanctions on Russia following the invasion of the Crimea (Singh, 2015). The public image of a friendly relationship and perhaps even increasingly close bilateral ties belie the skepticism on both sides with regards to Sino-Russian ties (Radio Free Europe / Radio Liberty, 2017).
Existing literature discourages the idea that China and Russia are inevitably headed for a collision course. Although Russia remains concerned over Chinese designs
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in Central Asia, the BRI and the EEU are not necessarily mutually exclusive concepts, as they are ultimately aiming towards different goals, with the former focusing on economic ties and the latter seeking to preserve its privileged political position (Kaczmarski, 2015).
However, in terms of policy, the BRI has not shown signs of developing in a direction that forms “a stepping stone toward a greater Eurasian bloc or a two-power condominium in Eurasia” (Remington, 2016). If Moscow’s public support for the BRI and for improved relations with China is a cynical strategic decision in recognition of its economic hurdles, then it puts into question how Moscow may react to or even resist increased Chinese influence in Central Asia as a matter of principle. This is especially so since it is not yet clear how to connect the BRI and the EEU yet (Putz, China Pushes One Belt, One Road in Central Asia, 2016). This is likely to be dependent on the lifting of Western sanctions on Russia and the recovery of the Russian economy, at which point the BRI may have consolidated sufficient Chinese influence in the region that makes it difficult for Moscow to dislodge, especially with increased resistance in Central Asia against Russian imports (Lillis, 2015).
Finally, Europe is the end destination of the BRI as it is publicly envisioned, and seen in the manner in which at least sixteen European delegations, including Russia, were represented out of the fifty-seven confirmed minister-level delegations present at the Belt and Road Forum as of May 2017 (The Diplomat, 2017). Chinese operations in Greece, specifically in the port of Piraeus, have been at the forefront of the Chinese trade efforts in Europe, and it is also courting Central and Eastern European states through the “16+1”
mechanism (Browne, 2016). This has fractured the unity of the response to the BRI from
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the European Union, as evidenced through its weakened response to the arbitral tribunal verdict on China versus the Philippines, with the primary holdouts being Greece and Hungary, two major European beneficiaries of Chinese investment (Emmott, 2016).
While it is questionable that the development of the BRI can reach an advanced stage across EU markets even during Xi’s second term, the resistance of several EU states to Chinese trade strategies such as the dumping of Chinese industrial overcapacity, to the point where anti-dumping tariffs have been passed into law (Le Corre, 2017).
Furthermore, EU states, foremost among them Germany, are concerned about the reciprocity of market access, as China seeks export markets but fall short on fair trade and free competition that erects barriers to entry for foreign investors while supporting domestic industries (Glenn, Mason, Peter, & Munroe, 2017).
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