Belt and Road Initiative’s Regional Impact: Lessons from South Asia

Abstract

Since its launch in 2013, the Belt and Road Initiative (BRI) has attracted frequent commentary and analysis. Much of these discussions have focused on its effectiveness and viability as a large-scale economic as well as geopolitical project. This paper contributes to that discussion by exploring BRI’s impact on regional organizations, specifically in South Asia. Using South Asian Association for Regional Cooperation (SAARC) as a case study, I argue that BRI’s impact on regional organization is inadequately understood. BRI is not a competitor to regional organizations, but its presence in a region creates a priority conundrum for member states i.e., members who join effectively must mainline the BRI into their national interests. By offering transactional functionality, BRI offers member states the opportunity to access immediate tangible benefits like foreign investment and infrastructure development. While states continue to be the members of various international and regional organizations, their commitment and policy priorities inevitably end up aligning with BRI if they choose to sign up. With BRI as a part of their national interest, states inadvertently cede policy autonomy, especially on issues of concern for China. This creates a situation that grants China a voice in organizations where it’s not even a member. This impacts the character and culture of regional organizations creating relevancy and effectiveness concerns.

The Belt and Road Initiative's (BRI) Impact on International Trade of SAARC Countries

“…Although the signed FTA was tilted more towards benefitting China, Pakistan still signed it foreseeing longrun FDI opportunities [16] . Similarly, Maldives also signed an FTA in 2017 while Nepal and Sri Lanka are going through negotiations with China on similar FTAs [3] . Ample research has shown that BRI has significantly benefitted SAARC countries in improving their mutual connectivity in terms of mutual trade and with their trade partners.…”

“…Often referred to as a "New Silk Road", BRI aims to make it within easy reach of countries to connect in terms of international trade. However, BRI has engendered ample debate and inquiry on its implication for worldwide dynamics which has been the focus of multitudes of contemporary research [3] . This paper attempts to analyze the impact of BRI (as an international trade network) on the international trade of regional organizations, focusing on SAARC countries.…”

“…The project is a manifestation of the "Chinese Dream" that aims to access a much wider market and underpin the complex international trade networks (ITN). Often referred to as a "New Silk Road", BRI aims to make it within easy reach of countries to connect in terms of international trade [3] . However, BRI has engendered ample debate and inquiry on its implication for worldwide dynamics which has been the focus of multitudes of contemporary research [10] .…”

The case for smart diplomacy: Evidence from Taiwan's New Southbound Policy

“…It would get outbid at every turn. And even if it were to be member of a regional organization, BRI's impact would seep through even then (Rasool, 2022).…”

“…To achieve this task the Chinese government has encouraged and supported the State-Owned Enterprises to invest heavily in countries that are part of these routes. For instance, in Pakistan, the Chinese government is investing 46 billion US Dollars in a space of 10 years through multiple projects under the umbrella of China Pakistan Economic Corridor (CPEC) (Rasool, 2022). In Indonesia, China is investing over 4 billion US Dollars on a high-speed 150 KM train link between Jakarta and Bandung, while in Laos, China has invested to the tune of 10 billion US Dollars to build everything from roads, bridges to dry port and train links.…”