Skip to main content

China’s new Silk Road hits $14 bn pothole in Pakistan

In some areas, Beijing is suffering a political backlash due to fears of domination by Asia’s biggest economy. (Source: Reuters)
China’s plan for a modern Silk Road of railways, ports and other facilities linking Asia with Europe hit a $14 billion pothole in Pakistan.
Pakistan’s relations with Beijing are so close that officials call China their “Iron Brother.” Despite that, plans for the Diamer-Bhasha Dam were thrown into turmoil in November when the chairman of Pakistan’s water authority said Beijing wanted an ownership stake in the hydropower project. He rejected that as against Pakistani interests.
China issued a denial but the official withdrew the dam from among dozens of projects being jointly developed by the two countries.
From Pakistan to Tanzania to Hungary, projects under President Xi Jinping’s signature “Belt and Road Initiative” are being cancelled, renegotiated or delayed due to disputes about costs or complaints host countries get too little out of projects built by Chinese companies and financed by loans from Beijing that must be repaid. Also Read: China’s new ‘Silk Road’ cannot be one-way, says French President Emmanuel Macron
In some areas, Beijing is suffering a political backlash due to fears of domination by Asia’s biggest economy.
“Pakistan is one of the countries that is in China’s hip pocket, and for Pakistan to stand up and say, `I’m not going to do this with you,’ shows it’s not as `win-win’ as China says it is,” said Robert Koepp, an analyst in Hong Kong for the Economist Corporate Network, a research firm.
“Belt and Road,” announced by Xi in 2013, is a loosely defined umbrella for Chinese-built or -financed projects across 65 countries from the South Pacific through Asia to Africa and Europe.
Other governments welcomed the initiative in a region the Asian Development Bank says needs more than $26 trillion of infrastructure investment by 2030 to keep economies growing. Nations including Japan have given or lent billions of dollars for development, but China’s venture is bigger and the only source of money for many projects.
Governments from Washington to Moscow to New Delhi are uneasy Beijing is trying to use its “Belt and Road” to develop a China-centered political structure that will erode their influence.
Among projects that have been derailed or disrupted, authorities in Nepal canceled plans in November for Chinese companies to build a $2.5 billion dam after they concluded contracts for the Budhi Gandaki Hydro Electric Project violated rules requiring multiple bidders.
Consulting firm BMI Research has compiled a database of $1.8 trillion of infrastructure investments across Asia, Africa and the Middle East that include Chinese money or other involvement.
“It’s probably too early to say at this point how much of the overall initiative will actually be implemented,” said Christian Zhang, a BMI analyst.
The U.S. and Japanese governments express interest in building contracts or other potential opportunities. But they also are trying to develop alternative initiatives.
The stumbles for one of the world’s most ambitious infrastructure ventures could help temper concerns Beijing will increase its strategic influence.
Even Pakistan, one of China’s friendliest neighbors, has failed to agree on key projects.
The two governments are developing facilities with a total cost of $60 billion including power plants and railways to link China’s far west with the Chinese-built port of Gwadar on the Indian Ocean.
A visit by a Chinese assistant foreign minister in November produced no agreement on railway projects in the southern city of Karachi valued at $10 billion and a $260 million airport for Gwadar.
The same month, the chairman of the Pakistan Water and Power Development Authority announced the Diamer-Bhasha Dam would be withdrawn from joint development.
“Chinese conditions for financing the Diamer-Bhasha Dam were not doable and against our interests,” the official, Muzammil Hussain, told legislators, according to Pakistani news reports.
The Chinese Cabinet agency overseeing “Belt and Road,” the National Development and Reform Commission, denied in a written statement that it asked for an ownership stake.
“Belt and Road” is interwoven with official efforts to export Chinese rail, hydropower and other technology and steel, aluminum and other industrial goods.
In Thailand, work on a $15 billion high-speed railway was suspended in 2016 following complaints too little business went to Thai companies. A new plan announced in July gives local contractors a bigger role.

Comments

Post a Comment

Popular posts from this blog

As many as 12 killed in New York’s deadliest fire in decades

More than 160 firefighters helped bring the blaze under control. (Source: Fire Department New York/Twitter) A massive fire ignited accidentally by a three-year-old boy swept through a five-story apartment building in New York, killing at least 12 people including a toddler and injuring four others in the deadliest blaze to hit the city in decades. The fire broke out around 6:50 pm (local time) yesterday on the first floor of the Prospect Avenue apartment in the Bronx borough of the city and spread quickly, officials said, adding that the cause of the blaze is under investigation. “We found that this fire started in a kitchen on the first floor,” fire commissioner Daniel Nigro said. “It started from a young boy, three and a half years old, playing with the burners on the stove. The fire got started, the mother was not aware of it – she was alerted by the young man screaming.” The boy’s mother fled with her two children, leaving the door to the apartment open – allowing t...
Post a Comment
Read more

Ukraine crisis: Exchange of hundreds of prisoners takes place

Ukrainian President Petro Poroshenko attends a ceremony to welcome prisoners of war (POWs), released after the exchange with pro-Russian separatists, upon their arrival at an airport in Kharkiv, Ukraine December 27, 2017. (Source: Reuters)  Ukraine and separatist rebels in the east of the country have exchanged hundreds of prisoners, in one of the biggest swaps since the conflict began in 2014. Around 230 people were sent to rebel-held areas in return for 74 prisoners who had been held by pro-Russia rebels in the Donetsk and Luhansk regions, BBC reported on Wednesday. It was the first swap in 15 months. The release and exchange of prisoners was one of the points in the Minsk peace agreement, signed in 2015. The deal has stalled since and analysts say the swap does not signify wider progress. Both sides continue to hold other prisoners. The number of prisoners swapped was lower than initially announced after dozens of people who were meant to be returned to rebel-held terr...
Post a Comment
Read more

Nepal declares ban on solo, blind and double amputee climbers from Everest

This ban is likely to irk solo mountaineers, who enjoy the challenge of climbing alone. In a bid to prevent accidents, Nepal has banned solo climbers from climbing its mountains, including Mount Everest, reported news agency AFP. Earlier on Friday, the cabinet declared revised regulations of the Himalayan nation’s mountaineering, where banning solo climbers from scaling its mountains was one of the key measures being flagged ahead of the 2018 spring climbing season. The cabinet also declared a ban on double amputee and blind climbers, even though Everest has drawn multitudes of mountaineers wanting to overcome their disabilities and achieve the formidable feat. “The changes have barred solo expeditions, which were allowed before,” Maheshwor Neupane, secretary at the Ministry of Culture, Tourism and Civil Aviation, told AFP. Neupane added that the law was revised to make mountaineering safer and decrease deaths. Earlier in April this year, an experienced...
Post a Comment
Read more