New Delhi, Nov 11 (IANS) China's Belt and Road Initiative (BRI) is facing more challenges across South Asia over economic, political, security and geographical constraints, as evident from China Merchants Port Holdings' withdrawal from $392 million joint venture to develop a logistics hub in Sri Lanka’s Port of Colombo, a new report has said.
The state-owned Chinese port operator's withdrawal highlights weakness in translating large-scale infrastructure investments into sustainable development outcomes, the report from Mekong News said.
Recent developments in Sri Lanka have renewed questions about the viability of some BRI projects and the latest withdrawal drew comparisons with Sri Lanka's Hambantota port, which was leased to a Chinese company for 99 years in 2017 amid financial pressures.
Though China-Pakistan Economic Corridor (CPEC) was designed to connect China's Xinjiang region with Pakistan's Arabian Sea coast through transport and energy infrastructure centred on Gwadar Port, it suffered from economic instability and energy-sector liabilities.
Further, financing difficulties and security concerns, including attacks on Chinese nationals and projects complicated implementation, the report said.
“The broader lesson is that infrastructure investment does not automatically generate sufficient revenue to service debt or produce sustainable development. Although Pakistan remains strategically important to Beijing, close political relations have proved insufficient to guarantee the economic success of major infrastructure commitments,” the report said.
Meanwhile, in Nepal, difficult Himalayan terrain, high infrastructure costs, financing concerns and practical challenges related with cross-border connectivity limited progress on BRI-linked ambitions to diversify trade and transport links.
Developments in Bangladesh pointed to how political transitions can affect long-term infrastructure and investment relationships. While Chinese investments have played a significant role in supporting infrastructure and industrial development but changes in the political landscape showed that strategic priorities can evolve with new governments.
Bangladeshi Prime Minister Tarique Rahman’s trip to Japan this week demonstrated that strong relations with an incumbent government will not substitute for broader political legitimacy or guarantee that its long-term interests would remain unaffected by domestic transitions.
Chinese-backed infrastructure and closer diplomatic relations have been at the centre of Maldives’ wider debate over foreign influence, economic dependence and national sovereignty.
“As a small island state situated in a strategically important part of the Indian Ocean, the Maldives must balance economic opportunities with the need to preserve its decision making autonomy and maintain relations with competing regional powers, particularly India and China,” the report noted.
—IANS
aar/pk
