During the visit of the Indian prime minister Narendra Modi to the White House on the 13th of last February, the American president Donald Trump expressed his support for the India-Middle East-Europe Economic Corridor. This project is proposed to pass through some regions where the Chinese Belt and Road Initiative is also passing through; one of these regions has strategic importance, which is the Arabian Gulf. This position paper investigates whether the overlap between China’s Belt and Road Initiative and the India-Middle East-Europe Economic Corridor in the Arabian Gulf region will be competitive or cooperative.
In 2013, the Chinese President Xi Jinping announced the Belt and Road Initiative (BRI), a project that aims to connect Europe, the Middle East and Africa through establishing a set of roads and sea routes. This initiative aims to enhance investment and build energy, industry and trade projects, strengthen the cultural ties and create jobs. A decade after announcing this project, and during the G20 Summit of 2023 in New Delhi, a memorandum of understanding was signed by several nations, which are India, the United States, the UAE, KSA, France, Germany and Italy, to announce the Indian-Middle East-Europe Economic Corridor (IMEC), which aims to connect India with the Middle East and Europe using two separate corridors: an eastern corridor that links India with the Gulf region and the northern corridor, which connects the Gulf with Europe. This project visualizes a multi-modal transportation corridor that combines roads, ports, railways, and affiliated logistical infrastructure. The proposed corridor will be a mix of sea and rail links for physical connectivity and is also proposed to have a pipeline for clean hydrogen, data cables to connect high-bandwidth digital, and cables for electricity.
Looking at the Arabian Gulf region in the light of the overlap between these two projects raises questions about whether the future of this overlap will be competitive or cooperative. The questions over the competitiveness of the projects come from three contextual dimensions:
1. The nature of the Chinese-Indian relation, which is defined mostly by competition and hostility. Armed border clashes between the two powers occurred in 1962, 1967, 1987, 2018, 2020, and most recently in December 2022. In addition, the mutual regional behaviors of the two powers reveal a state of competition and threat that each feels towards the other. India perceives BRI as an attempt of encirclement, especially since most of the South Asian countries are part of this initiative, prompting India to resist BRI instead of engaging in it. Further, the Indian maritime strategy of 2015 pointed out that China is a major threat to Indian maritime security. Thus, India, alongside the United States and Japan, pressured Bangladesh to cancel the Sonadia Port project in 2016, which was supposed to be a strategic point for China, as the presence of the Chinese navy there will make it close to Indian shores. On the other hand, China sees the Quadrilateral Security Dialogue – Quad, which was established in 2022 and included the United States, Australia and Japan, along with India, as an “Asian NATO”.
The regional competition between China and India extended to include their attempts to influence some nations such as Sri Lanka and Maldives by backing internal political forces that are favorable to them in these countries. In the 2015 presidential election in Sri Lanka, China supported President Mahinda Rajapaksa, while India supported his rival Maithripala Sirisena. This scenario was repeated in the presidential elections in the 2018 Maldives, when China backed President Abdulla Yameen; in exchange, India supported his rival Ibrahim Mohamed Solih.
2. Alliance Policy. Indica’s concern about China in South Asia increases with the increasing of the rapprochement between China and Pakistan, especially since the announcement of the China-Pakistan Economic Corridor (CPEC) in 2015, which constrains India’s access to Central Asian countries and passes through Kashmir, a territory that China considers as a part of its own land. On the other side, the United States is trying to enhance the Indian role in South Asia and the Indian Ocean in order to contain China. Back to the armed border conflicts between India and China, we can note the activation of this rapprochement, especially the American role.
Moving on to the regional context of the Arabian Gulf, a state of an Indian consistency with the American policy can be noticed, which comes as a result of a broader consistency in the Indian policy with the policy of the United States, especially since the Bharatiya Janata Party took power in India in 2014. After the American sanctions on Iran because of its nuclear ambitions, India rejected implementing the Chabahar-Zahedan line, which was part of the Iran-Afghanistan Transit Corridor project signed in 2016. It is also noticed that the ally policy of both India and China is not limited to South Asia and the Indian Ocean region, but it extends to include the Arabian Gulf region, which is evident in the joint military exercises, “Sea Guardians”, between China and Pakistan. In contrast, India, since 2022, has become a member of the Combined Maritime Forces (CMF) led by the United States, aiming to secure the navigation in the Gulf region. However, China perceives this accession as a part of efforts to contain its influence in the Indian Ocean.
3. The regional readiness. The Gulf region by itself is a contested area and contains pre-request factors that would be a basis for potential animosity between India and China, and the two main factors are the location and the energy. China and India are among the top four oil consumers in the world, and in 2015 China became the world’s biggest importer of oil, and over 50 per cent of its imports come from the Gulf. India, on the other hand, imported 55.3% of its oil in 2022-2023 from the Gulf, reduced from the previous year, which was 63.9%, and the signs signify a re-increase in the Indian dependency on the Gulf oil. Securing oil supply in a region that is part of the Middle East, where risk factors are high, is a hard mission that would lead both China and India to expand their military presence in the region. The restrictions that India had experienced in oil supply after the Iraqi invasion of Kuwait in 1990 pushed it to militarily exist in the Gulf region, especially since Indian reserves of oil are enough for just some days. The figures indicated an increase in the importance of the Gulf region in the security and military calculations of India and China. For India, there is multiple defense cooperation with the Gulf countries, but Oman has received special attention since decades ago, and in 2018 the Indian Navy gained access to the Duqm port, while the PLA Navy, for the purpose of conducting drills with regional naval forces, has sent ships to Iran, Kuwait, Oman, Qatar, and Saudi Arabia.
On the other side, some researchers assume that the relation between BRI and IMEC in the Gulf region will be cooperative, arguing that both of them are directing toward integration instead of competition. Some dimensions support this assumption:
1. The cooperative side of the Indian-Chinese relation. China is the biggest trade partner of India, after which was the second biggest partner after the United States. The volume of trade between the two powers increased from $38 billion in 2007 to $113.8 billion in 2022, meaning it tripled in fifteen years. Further, both India and China are members of the Shanghai Cooperation Organization (SCO) and BRICS. Also, India is a founding member of the Asian Infrastructure Investment Bank (AIIB), which was established by China in 2014. In addition, both countries have similar positions towards some of the international issues, such as climate, food and energy.
2. The mutual need for stability. Besides the fact that the Arabian Gulf region is a presence and transit point for both projects, the energy dependency of China and India on the Gulf region forces them to prevent threatening the region or the energy supply lines. Further, the GCC countries depend a lot on energy exporting, which makes them interested in enhancing the cooperation between the two projects at the expense of competition. The Gulf countries also have a chance to benefit from both projects, as is the case with the Kingdom of Saudi Arabia’s Vision 2030, which has economic aims consistent with both initiatives. In addition, there are around 9 million Indian residents and 2.5 million Chinese residents in the Arabian Gulf countries, which pushes both China and India to maintain stability in the region to protect their nationals’ interests.
3. The number of ports, logistics rails and train lines in the IMEC are managed by Chinese companies; the most important of these companies is COSCO, which operates, as an example, a sea line from India’s ports to Europe, and the Shanghai International Port Group, which operates the Bay of Haifa, and this cooperation gains economic benefits for the Chinese companies, which enhances the opportunities for integration between the two projects.
Looking at both competitive and cooperative dimensions in the previous discussion can lead to some conclusions:
First: The competition and hostile indicators between China and India are more than the indicators of the cooperation.
Second: The dimensions of the security cooperation between China and India are limited in the Shanghai Cooperation Organization, and there is an absence of security and defense cooperation and coordination between them in South Asia and the Indian Ocean, as well as in the Arabian Gulf region. And regarding the ending of the border conflict after the 2020-armed clashes, renewed at the border in 2022, it came as a result of the signing of a bilateral agreement between them in October 2024.
Looking to the given cooperation dimensions between the two countries, we note that it is centered on the economic area in which the trade balance is clearly tilted in favor of China. China’s exports to India in 2023 peaked at $122 billion, while the Indian exports to China were $16.2 billion in the same year.
Third: The behavior of one of them, especially in the military sphere, is often interpreted by the other as a threat, a thing that may come from their mutual perceptions, resulting from their historical hostility and the nature of their alliance policy.
Fourth: The hostility status between India and China did not prevent them from building an economic partnership. In contrast, and the most dangerous, the economic cooperation between them did not prevent the hostile situation that leads to war. China is the biggest trade partner of India, but this partnership did not prevent the armed clashes between them from happening. Thus, any attempt to link both projects with each other economically in order to create a state of mutual interdependence perhaps will not be sufficient to prevent the potential conflict between them.
Fifth: The military presence of both China and India in the Arabian Gulf region is linked to the size of their interests there, which is a dangerous indicator given the continuous increase in the interests that both powers have with the GCC countries. Under BRI and IMEC, there is a strong anticipation that these interests will further increase.
Six: The American factor plays an important role in the future of the intersection between the projects in the Gulf region, as the inclusion of this region in the US-Indiana alliance indicates American efforts to contain the Chinese influence there, especially with the increase in the American strategic focus on the waterways. It is clear that the Trump administration will pressure the GCC countries to limit their relations with China, a scenario that occurred in the previous presidential term of Trump.
Based on that, there are three potential scenarios for the future of the overlap between BRI and IMEC in the Arabian Gulf region:
First: Participatory. This scenario may come as a result of the parties’ needing to prevent the escalation of the competition in the Gulf region, as this competition may threaten the presence of their projects there and threaten maritime security, which damages the energy supplies and trade lines of both. It may also threaten the presence of both Indian and Chinese laborers in the Gulf countries. Achieving this scenario requires rapprochement initiatives between the two powers, and the parties who can play this role are the UAE and Saudi Arabia, as they have ties with both projects.
Second: Intensifying competition. This scenario is more probable to occur compared to the first scenario, as it is supported with stronger indicators. Most importantly, the increasing of the Indian and Chinese interests in the Gulf under their projects, accompanied by a rise in their military presence in the region, which is an alliance activity similar to what is happening in South Asia and the Indian Ocean. If this scenario occurred, it would negatively impact the stability of the GCC countries. Thus, it is important to build a regional mechanism to limit the militarization of the BRI and IMEC in the Gulf.
Third: Maintenance of the status quo. By continuing the situation as it is without change towards participation or escalating competitiveness. This scenario is consistent with the presence pattern of India and China in the Gulf region in the past decades. There have never been cases of hostility or conflict between the two countries in the Arabian Gulf in the periods before launching the BRI and IMEC, despite the existence of border disputes and regional hostility between India and China during those periods, in conjunction with the existence of common interests between them and the Arab Gulf countries.
Abdallah Zuhier Qerba