Three weeks ago, President Xi Jin-ping hosted one of the biggest gatherings of world leaders in Beijing the inaugural meeting of OBOR “One Belt One Road”, China’s plan for global trade. So far 68 countries and international organizations have signed up for the mega infrastructure project. So far OBOR has initiated $US1.3 trillion worth of projects but in the OBOR forum, Xi pledged at least $113 billion in extra funding and urged countries across the globe to join hands with him in pursuit of globalization. At the end of the forum, OBOR has expanded by signing another 270 MOUs expanding the scope to include finance and information sharing.
What is OBOR? Some describe it as a Chinese version of the Marshall’s Plan, while others label it as a Chinese master plan for world economic domination. In truth, it’s neither. The Marshall Plan was an American programme that was open to countries which subscribed to the anti-communist crusade, while OBOR is open to all irrespective of political leaning. Second, OBOR is not an aid programme but more akin to a soft loan programme in the style of the World Bank, but more powerful as it combines the financial muscle of a number of international finance organizations like the AIIB, IMF etc. The OBOR initiative is a joint investment opportunity where the Chinese and those willing to join the venture to invest in infrastructure development projects that reap profits not only from increasing trade but in investment. The programme is all encompassing, not only covering land-based projects linking Europe to Asia, but also the maritime trade connecting south China to Africa and the Mediterranean.
Even countries which do not share a land or sea border with China regard OBOR as important. President Michelle Bachelet of Chile (in blue skirt, front row), a country on the other side of the world with no direct benefit from OBOR, sees a rising China as beneficial to Latin America.
Through international cooperation, it hopes to alleviate poverty through economic growth and to build trust and peace, since trade partners don’t usually go to war with each other. The OBOR allows China to extend her power, and provides greater exposure of the RMB as a form of international currency alongside that of the Euro and the US Dollar.
In this gathering, 29 of the major world leaders were present. If they couldn’t attend they sent a representative and 130 countries did just that; even North Korea attended the meeting! After all, no one would reject the opportunity to make money! However three major absences at this forum are India, Vietnam and Japan, who all declined to send any representatives. While it is understandable why Vietnam did not go, for she had issues with China over the South China Sea and Japan’s animosity with China lingers despite 70 plus years after the ending of WWII, India’s decision not to attend is difficult to understand for she is in the heart of both the Road side and Belt side of the project, potentially reaping great benefits. Maybe India and Japan have more faith in Europe and America as the leaders of economic globalization and global developmental progress.
India’s spokesman faulted OBOR lacking “good governance, rule of law, openness, transparency and equality”, while Indian press editorials explained that India is upset about the $US57 billion China-Pakistan Economic Corridor (CPEC) project running through disputed Kashmir, as it violates their sovereignty. But in truth ever since the routing of the Indian Army by the Chinese PLA in 1962, India has never fully trusted China. In the past India claimed her superiority in economic prowess and her democratic forms of government, but in the years since China has opened up, India had been significantly overtaken by China in the economic race – China’s GDP is five times that of India’s, and China’s foreign exchange reserves are ten times that of India’s. In the words of, Mani Shankar Aiyar, a former MP now a well-known Indian pundit: “India is behaving like a sulking schoolboy whose lollipop has been stolen from him”.
To reject being part of this enormous project over the issue over “disputed land”, India has put pride over practicalities and realpolitik. China’s territory disputes with Japan over Diaoyu (Senkaku) Island have not stopped China developing economic and political relationships with Japan, but without Japan’s ODA aid, China’s economic development, especially in the 1980s may not have gone so smoothly. Great Britain’s territory disputes with Argentina and Spain over Falklands and Gibraltar did not stop both sides developing economic cooperation either. Even the United States have a long running border dispute with Canada but this has not stopped both countries developing strong ties. By refuting the OBOR, China’s foreign ministry spokesman warns that “India risk being isolated by not attending”, which Mani Shankar Aiyar deemed as “smug”, but the truth is that it was not intended to be smug nor cruel. It was just a statement of fact that India’s historical dislike of China has affected their economic credibility.
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