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China’s “New Maritime Silk Route”, What it is for Asian Neighbors?; By Naga Malleswara Rao

C3S Paper No. 0121/ 2015


NAGAMALLESWARARAO 111111111 copy

Introduction:

The‘New Maritime Silk Route’, is a legacy of China’s ancient regional influence. The Maritime Silk Route (“China’s floating diplomacy”) helps China in its strategy in Asia, both as a hard power and soft power tool. The development of a Maritime Silk Route gives assistance for China in Asia for active foreign relations and engagements. India and the western world are viewing MSR as a political and military strategy rather than an economic strategy, despite their interest in the region. Ancient Maritime Silk Route explains the economic and political reasons behind the success of China in garnering support for the present day MSR.

‘Ancient Maritime Silk Route’ and New Maritime Silk Route of China:

In the mid nineteenth century a German geologist, Baron Ferdinand von Richthofen, named the trade and communication network Die Seidenstrasse (the Silk Road).

Life in the globalized world is an exchange of goods, skills and ideas observed frequently in accordance with regular practices. In the same process the Spice Route and MaritimeSilk Route emerged from the trade flourishing in Eurasian region.[i] This trade originated from India and China and involved exporting various goods like silk, spices as well as the transmission of knowledge, ideas, cultures and beliefs. The goods were traded in return for gold, precious metals, stones, mineral, etc. The merchants and traders had developed hubs of culture and learning in science, arts, literature, crafts and technologies.The ancient MSR route along which trade flourished witnessed the technological advances in the science of navigation, astronomy, and the techniques of ship building. These factors combined to make sea travel over long distances increasingly practical.

Subsequently coastal cities grew around the most frequently visited ports along these routes. The production process of silk in the ancient capital of Xian was maintained as a secret for about 3000 years by The Han dynasty. During 138 BC the emperor sent it as diplomatic gifts.[ii]Under Sui, Tang, Song dynasties the silk production process was revealed to Korea and Japan. Thus China’s Maritime Silk Route was divided into two, one was ‘East China Sea Silk Route’ (went to Korea and Japan) and ‘South China Sea Silk Route’ (went to Southeast Asia, Malacca, the Indian Ocean, the Red Sea and the continent of Africa). Yongle emperor of Ming dynasty sent Admiral Zheng He for an estimated seven voyages (during 1405-1435) to establish a Chinese presence and impose imperial control over the Indian Ocean trade. This was to impress foreign people in the Indian Ocean region, and for extending the empire’s tributary system. However the result of the (Haijin policy)ban on maritime trade by Ming and Qing Dynasties, was that it contributed to a massive decline in its use. In 1840 the Opium War broke out and the Silk Road on the Sea disappeared.

New Maritime Silk Route (New Maritime Silk Road of 21st century) is a new project initiated by the China’s president Xi Jinping in October 2013. He called for greater maritime cooperation between China and Southeast Asia nations, given the existing good diplomatic and economic relations. The New MSR extends to Sri Lanka and passes through Indian Ocean, Africa and to Europe, thus connecting to the New Silk Road. China is working on the project by accepting proposals from other countries. The region surrounding New Silk Road Economic Belt and the Maritime Silk Road contains 4.4 billion people (63 per cent of the world’s population), with an aggregate GDP of USD 2.1 trillion (29 per cent of the world’s aggregate wealth)[iii].This brings the Eurasian markets and new African economic colony of China into one single multiphase strategy. The partners of this project would be dependent on Chinese goods and services which will lead to the huge market to be in their hold. The recent studies reveal that the MSR project costs more than USD 43 billion. It will be backed by Chinese funded banks and companies. It will benefit the partners in improving their maritime infrastructural development. China will establish new ports, remodel the existing ports, engage in naval cooperation, and provide assistance to share the development opportunities.

The proposed New Maritime Silk route of China.[iv]


Rao map

The MSR touches six major segments:

(i)Development connective infrastructure such as high speed railways, highways and economic corridors,

(ii)Multifaceted development of connective infrastructure which increases the trade volume of China covering many sectors,

(iii) Strategy on greater use of local currencies in cross-border exchange, Renminbi as international transactions and reserve currency,

 (iv)Cultural exchange and people to people contact to promote mutual views,

 (v) Cross border exchange with governments of participating states for coordinating policies,

 (vi)Converting the special bonds and low-cost financing into real money.

The Aggrandizement of China through new Maritime Silk Route:

Aggrandizement is an act of increasing wealth, prestige, power or scope. China enjoys vast soft power potential, its usage is well known to the world. It has profound effects on its Southeast Asian neignehbours, despite the historical claims in the South China Sea. China’s dual attempt to provide connectivity to its western parts and to change its image internationally has led to the formation of a Maritime Silk Route fund that would finance construction of the infrastructure required to connect Asia to Europe.

The political angle also demands examination. There is a subtle change in China’s political attitude to build trust in the region.The 18th Party Congress of November 2012 witnessed the appointment of Xi Jinping as the party’s general secretary, who eventually became the President of China.He brings the international community’s attention towards China in a different approach, coming with new ideas and policies. These policies span internal governance and his stance on the coordinating with party and other top leaders. At this point he came with new path of setting goals of his “China dream”.[v]He conveyed to the political and standing committees a plan to undertake for placing China in the developed countries club upon completing hundred years of ‘Communist Party of China’, and number one economic power on occasion of Peoples Republic of China’s hundred years anniversary. He interrelated this to the development of neighboring states in order to expand the results of this mission.

There are diplomatic changes in interacting with neighboring states on long standing issues like border problems, historical and ethnic rivalry which are to be resolved bilaterally.[vi]China advices that the arguments be put aside, this will create a friendly environment and serve the concepts like mutual benefit, mutual cooperation, and gains to build trust in the region. China interlinks the strategic and political development in the region by highlighting the economic benefits. China sticks to its commitment and promotion of its policies in international forums which serves the imperceptible interest of China.

On the economic front, the immediate cause for establish MSR is China’s energy security. The quest of energy resources is for meeting the growing demand and to secure a lifeline for China over the Malacca dilemma.  The main aim is to transport the energy resources to China through various alternatives routes. Thus China proposed the China Pakistan Economic Corridor (CPEC) and the plan to upgrade Kuantan port of Malaysia which costs nearly $2 billion in the initial stage of MSR. This plan was welcomed by Cambodia, Indonesia, Malaysia, Pakistan, etc., for support to overcome the huge defect in infrastructural development of their ports.

How Asian neighbors and extra regional powers are viewing China’s Maritime Silk Route?

Sultan Hamengkubuwono X of Indonesia says “The Chinese Maritime Silk Road is a logistical route from China to other countries and so if the offer is accepted Indonesia will become consumers of Chinese products forever.”[vii] It seems he is viewing that eventually it will have negative impact on the 2.3 million people whose livelihood is depend on the maritime resources.

There is a fear that China would overshadow the influence of ASEAN as member countries become connected by roads and sea routes financed and constructed by Chinese companies. The fact remains that that China being a member of ASEAN+3, it tried twice to sideline the sea disputes outside the agenda of ASEAN and multilateral summits but failed. It remains to be seen how the issue will be taken in the recent Silk Route program. Li has offered a high-speed “Pan-Asia Railway Network” as a way to resolve the South China Sea dispute, for trade benefits and currency circulation and infrastructure development.

The Southeast Asian nations are intensely interested in the economic benefits of relations with China in order to maintain the strategy of “millions of friends and zero enemies”. The Maritime Silk Route will give an opportunity from the Southeast Asian side to resolve the disputes in South China sea (such as the oil rig HaiyangShiyou[H YSY] 981), and new fishing regulations by authorities on Hainan) by insisting China to come forward with a proposal which will respect the “ASEAN’s Six Point Principles on the South China Sea and the importance of maintaining peace and stability, maritime security, freedom of navigation in and over flight above the South China Sea.”[viii] There are various other factors which can be observed. However most of the countries involved are likely to view China with suspicion and will remain cautious.

As for India the Chinese ‘New Maritime Silk Route’ has strategic and political interests. India proposed to project ‘Mausam’ and ‘Spice Route’ which ensures the Indian waves in Indian Ocean,[ix] as an answer to New Maritime Silk Route. The MSR will ensure the role of active foreign military presence in Indian Ocean which is a serious issue for India’s strategic interest in the region. India is waiting for detailed clarification of MSR from China. Meanwhile both parties look forward to resolve disparities via MoUs and economic cooperation.

Pakistan strongly believes that the huge investments being made are beneficial in the long term for its ‘all weather friendship’ with China. The China Pakistan Economic Corridor (CPEC) project not only ensures economic development of Pakistan but also its security issues with the neighboring states (particularly to India).[x]

The strategic objectives of the United States in the Indian Ocean region gave much importance for U.S’ energy security, sea lanes of communications and its role in Middle East from decades. Significantly the region plays host to the transit of much of the world’senergy supplies and key trade routes. This region also has complex issues which are of concern to U.S.A such as the Iran nuclear programme, Islamist extremists, and a number of failed and failing states. The entry of new player China into a Maritime Great Game in Indian Ocean, leads to a clash of interest between the U.S and China. The result of Sino-US and Sino-Indian rivalries in the Indian Ocean regionhelped shape the India-US partnership. At this point, the capabilities of USA as the largest military power, having bases at Middle East (fifth fleet) and Diego Garcia Military Base, ensures itsgreater influence in the region. However, India should maintain its independent foreign policy to promote its national interest. India’s long commitment to maintain peace in Indian Ocean which is one of India’s long term strategic goals. Similarly India should be cautious of USA’s “China focused ASEAN Policy” (the name of the game in the Western Pacific) which seeks to manage China’s rise since many decades. USA has extended to India this policy as partner for minimizing the influence of China from Maritime Silk Route.

Close look and Comments on China plans aimed at pursuing strategic plans under the guise of aid:

  1. The Pan Asian high-speed railway would significantly help the poor rural farmers to bring their agriculture products to the market place in good time unlike other poor infrastructure mechanisms. This would be helping to linking the community of nations in integration. But will the political situation permit it?[xi] It does have implications on their own local market; four out of six countries of this project are active in their economy with potential tourism, fishing and trade market.

  2. Pan Asian high-speed railway is seen asa counter to Guwahati-Bangkok super highway ofMekong – India Economic Corridor (MIEC). This is part of India’s Look East Policy which was followed by the new slogans of “Act East policy”. India has practically updated its strategy in the region by allotting huge funds to strengthen regional connectivity and integration, particularly through cross border infrastructure.

Trade figures between India- ASEAN and India – ASEAN+3

Rao graph

Prabir De, Symposium on ASEAN‐India Connectivity 27 November 2013, Bangkok


  1. The above graph shows India’s trade potential with ASEAN is likely to cross USD 200 billion by 2020 as estimated by Prabir De, ASEAN – India Centre RIS, New Delhi in an in-depth study on Mekong – India Economic Corridor. The successful implementation of New Maritime Silk Route may change the above calculations.

  2. “The RMB 200-500 trillion available as low cost loans with central banks around the world will be partly used in MSR. Such funds can only be used to buy ‘Made in China’ goods and services (just as USD ultimately has to be spent in or on the U.S.).”[xii]It would greatly boost the infrastructure building industries (both products and services).

  3. Is China rebranding the ‘string of pearls’ with Maritime Silk Route and converting the strategic operation into an economic mission?

  4. The “One belt, One road” initiative was launched as a response to the Obama administration’s much hyped “pivot to Asia.”

Conclusion

The promotion of China’s peaceful rise through the slogans of Maritime Silk Route may help China in international politics. China promoted the MSR proposal internationally through good diplomatic skills. The soft power tools are more effective and efficient concepts in contemporary global politics because of its endurance and sustainability. The vision of Maritime Silk Route aims to develop regional connectivity and infrastructure, backed by China which would ultimately serve its long term strategy. Southeast Asia is seen as a region of great importance for China’s role in international politicsand is clearly understood by China’s present leadership. However, the acceptance of small states like Sri Lanka, Maldives may help MSR little, but the MSR will remain as strategy until players like India considers joining it. As of now India has not joined China’s Maritime Silk Route despite being an influential player in Indian Ocean Region. India’s commitment to non-alignment and its relevance would never drag India to lean towards any combat forces. Still there is long way to see MSR’s successes or it may remain as a mere plan. The future of the MSR project remains uncertain, due to hostile relations with neighbors and island disputes in South China Sea.

Finally new aspirations have arisen from Southeast Asian nations that China has come to their door steps, and it is a better time to resolve disputes and to get benefit through new plans by meaningful negotiations on diplomatic table rather than on a hot sea bed. The Maritime Silk Route remains ambiguous for now. Nevertheless MSR depends on the credibility and commitment of the Chinese leaders and the ASEAN countries in the region.

India must exploit its soft power assets to use its economic and friendly relations to formulate systematic plan of actions and views. This will serve the Indian political and economic involvement in region.

[i]“Trade History of the Silk Road, Spice & Incense Routes”, Silk Routes.Net,  http://www.silkroutes.net/SilkSpiceIncenseRoutes.htm(accessed May 13, 2015).

[ii],“About Silk Road- Dialogs, Diversity & Development”, UNESCO(United Nations Educational, Scientific and Cultural Organaigation) https://en.unesco.org/silkroad/about-silk-road/(accessed may 13, 2015).

[iii]H.E. Ambassador Yang Yanyi,“China to revive ancient Silk Road”,euobserver,12 May, 2015. https://euobserver.com/euchina/128666

[iv] Mrunal, “China’s Maritime Silk Road initiative, Purpose, Salient Features, India’s stand”, http://mrunal.org/2014/10/diplomacy-china-maritime-silk-road-initiative-purpose-salient-features-india-stand.html (accessed May 13, 2015).

[v]“Changing political attitudes in twenty first century China” , Worlds Socialist Web Site http://www.wsws.org/en/articles/2004/12/chi2d08.html(accessed May 12, 2015).

[vi]Wang Yizhou, “China’s New Foreign Policy: Transformations and Challenges Reflected in Changing Discourse”, The ASAN Forum, March 21, 2014. http://www.theasanforum.org/chinasnewforeignpolicytransformationsandchallengesreflectedinchangingdiscourse/

[vii]Indonesia must reject Chinese maritime Silk Road offer: Sultan”, ANTARANEWS.com, 11 May, 2015.http://www.antaranews.com/en/news/98895/indonesia-must-reject-chinese-maritime-silk-road-offer-sultan

[viii]“China’s Maritime Silk Road and South China Sea Tensions: HYSY 981 inAction”, China-US focus, Feb 04, 2015.http://www.chinausfocus.com/peace-security/chinas-maritime-silk-road-and-south-china-sea-tensions-hysy-981-in-action/

[ix]Shannon Tiezzi, “The Maritime Silk Road Vs. The String of Pearls”,The Diplomat,February 13, 2014.http://thediplomat.com/2014/02/themaritimesilkroadvsthestringofpearls/

[x]“China’s new silk road: What’s in it for Pakistan?”,DAWN,April 20, 2015.http://www.dawn.com/news/1177116

[xi]Fang Yang,“China begins building pan-Asian high-speed railway in south western province”, Global Times, May 9,2014. http://www.globaltimes.cn/content/859360.shtml

[xii]Saibal Dasgupta, “China’s Ambitious ‘Silk Road’ Plan Faces Hurdles”,Voice of America, April 15, 2015.http://www.voanews.com/content/chinasambitioussilkroadplanfaceshurdles/2719660.html

(Naga Malleswara Rao is an intern with Chennai Centre for China Studies. As a statutory requirement of his academic course in Pondicherry Unversity, he is required to carry out research in a think tank  on identified issues in China under the guidance of the members of C3S.  The views expressed in this article  how ever are of the author. E-mail: nagamalleswararao.dokku@gmail.com )

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