Xi Jinping, President of the People’s Republic of China, had announced a development strategy that would cover infrastructure development and investments in over 150 countries across the globe and international organizations in Asia, Europe, Africa, Latin America, and the Middle East, in 2013. This is known as the One Belt One Road (OBOR) initiative, or the Belt Road Initiative or the Silk Road Economic Belt. The initiative was known as the One Belt One Road till the year 2016, after which it was changed as the Chinese government believed that the term “one” could lead to varying misinterpretations. What are the objectives of the strategy? The initiative was announced by Xi Jinping in September and October 2013 during his visits to Kazakhstan and Indonesia. The initiative aims to construct a unified large market and effectively utilize international and domestic markets, through the exchange of culture and integration, to lead to mutual understanding and trust of the member nations to form a pattern of development through the inflow of capital, use of latest technology and accumulation of new ideas and talent. The primary focus of the initiative has been on infrastructure investment, construction, railway and highway, automobile industry, real estate, education, power grid, and iron and steel. It has been estimated that the initiative is one of the biggest infrastructure and investment projects in the history of the world. It operates in more than 65 countries and included around 40% of the global GDP as of 2017. What is the extent of the OBOR initiative? The project is divided into the “Silk Road Economic Belt” which is based on land and connects China with Central Asia, Eastern Europe and Western Europe, and the “21st Century Maritime Silk Road”, which is sea-based and links China’s southern coast to the Mediterranean, Africa, South-East Asia and Central Asia. The ‘Belt’ refers to a network of roads, and the ‘Road’ refers to a sea route. The initiative covers six economic corridors: •New Eurasian Land Bridge that connects Western China to Western Russia. •China – Mongolia – Russia Corridor connecting North China to Eastern Russia via Mongolia •China – Central Asia – West Asia Corridor connecting Western China to Turkey via Central and West Asia •China – Indochina Peninsula Corridor connecting Southern China to Singapore via Indo-China •China – Pakistan Corridor that connects South Western China through Pakistan to Arabian sea •Bangladesh – China – India – Myanmar Corridor connecting Southern China to India via Bangladesh and Myanmar. •The sea-link Silk Road connects China to the Mediterranean via Singapore-Malaysia, Indian Ocean, Arabian Sea and Strait of Hormuz. Why is OBOR significant? OBOR is extremely important to China because of its capacity to boost China’s economic and domestic growth. It has also been called a strategy adopted by China to enhance its economic diplomacy. By connecting less developed regions near the border, such as Xinjiang, with neighboring nations like India, Pakistan, and Bangladesh, China expects to boost economic activity. OBOR was formed with a view to open up and create new markets for goods made in China. It will also enable the manufacturers to control cost-effective routes to export goods easily to other nations. Any excess capacity in terms of production will be channelized to regions along the OBOR routes. China had announced investments exceeding $1 trillion in infrastructure projects. China is funding them by offering low-cost loans to member nations. Countries such as Kyrgyzstan and Tajikistan are hopeful about OBOR due to huge investments by China in local transmission projects in these nations. Nepal has recently joined OBOR by signing a deal that will improve cross-border connectivity with China, and Pakistan will benefit from the $46 billion China Pakistan Economic Corridor (CPEC) that will connect South and Western China to Pakistan which will open up access to routes in the Arabian Sea. While China considers OBOR as an all-inclusive project for regional development, other nations see it as a strategic move by the country to attain significance and control at a regional level and to play a larger role at the international level by building and controlling a trading network that is China-centric. US President Donald Trump has posed several challenges for Asian nations through his measures such as trade tariffs and revoking of import duties, economists believe that China through OBOR wishes to emerge as a regional and therefore a global leader. It has also been estimated that there may be seen a boost in Chinese yuan with increased usage in the OBOR region.

Source: https://en.wikipedia.org/wiki/Belt_and_Road_Initiative

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