Chinese think tank says countries interfering in its overseas port projects

Sowmiya Ashok
The think tank serves as a Chinese government advisory research group. (Reuters)

A Chinese think tank report, released ahead of the second Belt and Road Forum scheduled to take place here this week, has named India and said that countries adopt direct or indirect measures to "interfere in China's overseas port projects".

The report specifically cites the example of India's involvement in Sri Lanka's Hambantota Port and its investment in Iran's Chabahar port which the report says is only "100 km away from Gwadar port" a crucial part of the China-Pakistan Economic Corridor.

The report titled 'A Strategic Analysis on China's Overseas Port Projects Under the Belt and Road Initiative' is by the Grandview Institution, which calls itself an "independent" think tank on its website. The Grandview Institution also serves as a government advisory research group, it says.

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"…Holding hostile attitude towards Chinese enterprises' overseas port investment, countries such as India and Japan compete with China by strengthening regional investment, and even take direct or indirect measures to interfere in China's overseas port projects," the report says.

It claims that China and Sri Lanka's cooperation in the Hambantota Port has "aroused the vigilance on the Indian part and stimulated India to increase its investment in Sri Lanka". "India is also developing a natural gas project in Trincomalee, the eastern coastal town of Sri Lanka. Some suggest that this may be a precursor to India's development of ports in the region to counterbalance China's investment in the southern and western part of Sri Lanka," the report states.

"The construction of Gwadar Port has triggered India's hostile attitude, intensified the confrontation between India and Pakistan, as well as India and China, and stimulated threat activities from the radicals, separatists and terrorists in Gwadar. India has created problems through public opinion and discredited the project. All these are problems that Chinese enterprises cannot ignore in the process of project construction," the report notes.

China's investments in port infrastructure is a crucial part of the BRI. Chinese enterprises have been involved in the construction and operation of 42 ports in 34 countries, the report notes. Further, the main entities of Chinese enterprises investing overseas are central enterprises, with "82% of the projects are implemented by central enterprises, 10% of them are implemented by local state-owned enterprises, and only 8% are implemented by private enterprises."

The report points out that though the Chinese government is "very cautious" about its attitude on "strategic support points", it is a "necessary step for Chinese enterprises investing in overseas ports to be linked with national security interests by building necessary defense capabilities at ports, establishing "strategic support points" in key regions, making overall plans to construct regional security systems, and ensuring secure and smooth regional and national trade."

"These are premised on the fact that China's port projects do not threaten the security and sovereignty of the host countries and are different from the establishment of overseas military bases of the United States. However, the above remains a long-term goal," it states.

Chinese enterprises have operational problems in overseas port projects, including the "premature mentality" in the commercial evaluation of investment projects, the report notes.

Andy Mok, a non-resident fellow at the Center for China and Globalization, told The Indian Express that as BRI projects move from "pure discussion-planning stage" to "operation stage" problems emerge.

"There are two aspects to BRI, one is the bricks and mortar, things happening on the ground: building of the port, railways and so on. The other is the public perception and the elite perceptions of what is going on. A report like this to designed to address both of these issues," he said. "It addresses things that can be communicated better, responding to some of the things on ground which is intrinsic to the environment in which the BRI is being implemented."