China misses India G20 summit: US, EU sign Mideast-India railway-corridor with India
ALBAWABA – China missing the India G20 summit may been exactly what the Indian leadership needed to launch their delayed response to the Chinese Belt and Road Initiative with the announcement of the Mideast-India railway-corridor.
Earlier on Saturday, the United States (US) signed a deal connecting the European Union (EU) with India through Saudi Arabia, the United Arab Emirates (UAE), Jordan and Israel, AlJazeera reported.
The Mideast-India railway-corridor aims to establish new railways and shipping corridors, in what seems as an attempt at offsetting China’s own Belt and Road Initiative.
Russian President Vladimir Putin, Indian Prime Minister Narendra Modi and Chinese President Xi Jinping hold a meeting on the sidelines of the G20 summit in Osaka on June 28, 2019. Both the Chinese and Russian presidents sent their premiers in their stead to attend the India G20 summit. (AFP / SPUTNIK / Mikhail KLIMENTYEV)
Notably, China’s land and maritime initiative connects 155 countries, from Asia throughout the Middle East and Africa, all the way to Europe. But apart from the maritime corridor, it does not directly connect India to Europe. The roads and railways go from India to China and from there to the rest of the world.
Effectively, “India was not part of the Belt and Road Initiative, so this initiative gives connectivity to India,” Radha Kumar, an independent analyst, told AlJazeera.
Rivalry peaks at India G20 summit with Mideast-India railway-corridor
This Mideast-India railway-corridor project comes as China’s economy struggles with declining demand both overseas and domestically and heightened tensions with the West, namely the US.
China’s mass and diverse economy has enabled the country to disrupt global supply chains in various sectors as the US ramped up sanctions to curb Chinese high-tech advancements in chipmaking and AI.
Saudi Arabia's Crown Prince and Prime Minister Mohammed bin Salman (L), Indian Prime Minister Narendra Modi (C) and US President Joe Biden attend a session at the G20 summit in New Delhi on September 9, 2023. (Photo by EVELYN HOCKSTEIN / POOL / AFP)
As of 2023, especially with Russia’s war in Ukraine, the US and its allies have been looking for new suppliers to fill in for China. Especially after the Chinese restricted the export of multiple critical goods and products, chief among which was the export ban on critical minerals used in the manufacturing of advanced chips and semiconductors.
According to Bloomberg, the Mideast-India railway-corridor deal has been in the making since January 2023, with the US leading the effort.
Additionally, in the past few months, Western companies and governments have submitted multiple investment plans and proposals for manufacturing projects in India, including Elon Musk’s Tesla and US chipmakers Micron. On the other hand, India rejected multiple Chinese proposals, including one to establish a BYD factory in India.
Is the Mideast-India railway-corridor really a response to China’s Belt and Road Initiative?
The project announced at the India G20 summit, will develop energy infrastructure and enable the production and transport of green hydrogen to all partner countries, according to Bloomberg. And it includes a new undersea cable connecting the region to improve telecommunications and data transfers.
However, US officials dismissed the idea the project was about countering Chinese influence in emerging markets.
Yet, one French diplomat confirmed to Bloomberg that there was competition with China’s Belt and Road and that it was not necessarily a bad thing. Countries were also looking at how to involve Egypt in the plans, they said.
The rail link will increase the speed of trade between India and Europe by 40 percent, European Commission President Ursula von der Leyen said.
The EU is India's third largest trading partner, accounting for €88 billion worth of trade in goods in 2021 or 10.8 percent of total Indian trade, the European Commission reported. Whereas India is the EU's 10th largest trading partner, accounting for 2.1 percent of EU total trade in goods.
France's President Emmanuel Macron (L) and India's Prime Minister Narendra Modi arrive for a luncheon on the sidelines of the G20 summit in New Delhi on September 10, 2023. (Photo by Ludovic MARIN / AFP)
Meanwhile, EU Exports to India stood at $49.76 Billion in 2022, according to Trading Economics.
Some US allies, namely Saudi Arabia and the UAE, have been moving closer to Beijing as they seek to strengthen ties with fast-growing economies to the east, with both joining BRICS as of last month.
The US and the EU have in recent years sought to counter President Xi Jinping’s Belt and Road Initiative, which has financed hundreds of billions of dollars worth of infrastructure in emerging markets.
China’s role in the Middle East has also grown, having brokered a detente between Saudi Arabia and Iran earlier this year.
