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June 2017 Edition of Power Politics is updated.  Happy Diwali to all our subscribers and Distributors       June 2017 Edition of Power Politics is updated.   Happy Diwali to all our subscribers and Distributors       
Issue:June' 2017


Gaining clout with cash

Malladi Rama Rao

For Chinese President Xi Jinping small is not beautiful. He is thinking big. A manifestation of the new Chinese world order is multibilliondollar "One Belt, One Road" (OBOR) initiative linking the old Silk Road with Central Asia, West Asia, Europe and Africa.
Belt in OBOR stands for land linkage. Road represents sea route. The plan was unveiled some three years ago to build ports, railways, airports and power plants virtually in every corner of the world.
Well, China has deep pockets. It can afford to splurge Yuans to win friends and to undertake a 21st century Star Trek with "where no man has gone before" monologue.
At the two-day OBOR summit in Beijing (May 14-15, 2017) there was good response to President Xi's call for "Globalization 2.0." He has invoked long forgotten Panchsheel, declared outright rejection of protectionism, and pledged $124 billion for his new Silk Road. To the great relief of the cash strapped nations!

Nawaz Sharif congratulates Xi on OBOR summit The US sent a low key representation to the summit attended by 29 heads of State and Governments, and some 1,200 delegates from 110 countries. Russia was represented by President Putin himself. Japan, France, Germany and UK marked their presence.
Singapore was not invited. India was invited but chose not to attend. From India's neighbourhood, Sri Lanka, Nepal, Bangladesh and Myanmar joined the Chinese forum but Bhutan did not. Prime Minister Nawaz Sharif–led an all-party delegation from Pakistan, which is the first beneficiary of OBOR. What are the takeaways from the meet?
One, Beijing has promised to import US$2 trillion worth of products from belt and road countries in the next five years.Two Chinese government will infuse another US $14.5 billion into the Silk Road Fund. It will also provide 60 billion Yuan in the next three years for poverty alleviation in developing countries along the new Silk Road.In addition the China Development Bank and the Export-Import Bank of China will chip in with 380 billion Yuan worth special lending schemes.
As some Sinologists point out, President Xi's ambition of propelling China to the centre stage of global power game marks "a sharp departure" from the approach of his predecessors, who had strictly adhered to Deng Xiaoping's tenet to "hide our capabilities and bide our time, never try to take the lead". Xi's efforts have coincided with an antiglobalisation wave in most of the western world.
If all the "Belt and Road"-pledged money is spent, it would dwarf the U.S.-led Marshall Plan that helped western Europe rebuild after World War II, according to management consultancy firm, Mc Kinsey. Evidently, OBOR will help fill a good share of the massive global infrastructure vacuum.
Yet, the United States has showed "little interest", Japan has upped the speed of "its own regional connectivity plans", and the European Union has given the initiative "a lukewarm" welcome.
Only Russia is backing China to the hilt with its gaze fixed on regional security and trade.

Pak, a vasal State

Sceptics are growing, well, even in Pakistan, which considers that its friendship with China is "higher than mountains, deeper than the ocean, stronger than steel and sweeter than honey". Karachi's sedate English daily, Dawn, has dug out hither to undisclosed details on CPEC - China Pakistan Economic Corridor flagship project under OBOR.
The disclosures show that Pakistan will be fully subjugated by China under the current terms and conditions of the $ 62 billion 15-year project. It will facilitate visa free travel for Chinese to Pakistan. Instead of transforming Pak economy the corridor may wreck its finances and societal structure making Pakistan a vassal state.
Under the plan, thousands of acres will be leased out to Chinese to set up "demonstration projects" in areas ranging from seedvarieties to irrigation technology. Such projects will end up as Chinese enclaves where local laws are not allowed, going by experience worldwide.

Also planned is a system of 24x7 surveillance in cities like Peshawar and Karachi. A national fibre optic backbone will be built across

The disclosures show that Pakistan will be fully subjugated by China under the current terms and conditions of the $ 62 billion 15-year project. It will facilitate visa free travel for Chinese to Pakistan. Instead of transforming the Pak economy, the corridor may wreck its finances and societal structure making Pakistan a vassal state.

Khunjerab Pass in Xinjinag (Western China) to Gwadar (Balochistan) for internet, and terrestrial distribution of TV broadcasts. This would mean more "dissemination of Chinese culture".

Backdrop entry

In short, CPEC will facilitate the backdoor entry of new East India Company into Pakistan. More than this what has raised the Pakistani hackles is the suggestion of China's envoy to Delhi, Luo Zhaohui, that Beijing could "rename" China- Pakistan Economic Corridor to acknowledge India's sovereignty concerns. In a speech on 05 May, he also said Beijing "supported a settlement of Kashmir dispute through bilateral negotiation". Islamabad was not pleased. And China quickly made Luo's remarks disappear from the transcript of his speech posted on the embassy's website.

This has not prevented Dawn and other Pakistani publications from seeing red-lines.
Said Dawn editorially: "Luo's comments are a warning against giddy notions inside Pakistan that CPEC has solidified Pakistan as its greatest, and possibly only, ally in the South Asia region. With a simple but frank phrase, 'China first', Luo demolished not just expectations that China will automatically side with Pakistan in its disputes with India but also drove a stake through hyperbolic assertions that CPEC and Pakistan's ties with China will help achieve a fair and just settlement on Kashmir. Indeed, policy makers here should be thankful to Luo and his superiors in Beijing for their clarity — and for offering Pakistan a template to follow."

Signal to Delhi

Hu Shishang Pakistani concerns are also aggravated by the not so hidden willingness of Beijing to keep the OBOR door open for India. The absence of Gilgit-Baltistan Chief Minister in Nawaz Sharif's delegation (it included Chief Ministers of four other provinces) appeared as an engineered signal to New Delhi.
Interestingly, this did not stop China from going ahead with its plans for the Bhasha dam project near Gilgit.
"The government head in Gilgit- Baltistan did not come for technical reasons. But China is also conveying a subtle message that it recognises India's concerns on the Kashmir issue", Hu Shishang, director of the government-run Institute of South and South East Asian Affairs told Times of India. He added that it would be "perfectly alright" if India wants to take its own time to decide, and prefers to join the Belt and Road programme at "a later date".
These ifs and buts notwithstanding, will President Xi realise the new China dream in his term? Beijing is not giving loans cheaply as the experience of Pakistan, Sri Lanka and a host of African nations' show. This flip-side itself puts breaks on the clout that comes from OBOR. So much so there is no reason to worry about a Chinese juggernaut.
Also by the fact that "the top-down, autocratic nature of the belt and road plan and China's selfinterested structuring of the projects mean that it is likely to fall short of its aims," as the Washington Post said editorially on 16 May.