Indian deal with Iran shows commitment to infrastructure that will benefit China too

By Hu Weijia Source:Global Times Published: 2016-5-27 0:03:31

There is no reason for jealousy in China about a milestone deal signed between India and Iran.

India and Iran have agreed to develop a modern port near the Persian Gulf as well as road and rail links that would allow New Delhi to bypass Pakistan and strengthen trade between South and Central Asia, according to a recent report by the Financial Times. The plan comes at a time when Pakistan and China are busily forging a "community of shared destiny," according to Chinese President Xi Jinping.

Pakistan is working with China to develop the deep-water Gwadar Port in its southwestern region. The port is expected to shorten the distance of China's oil import route and open up new trade routes for China in Central and South Asia.

It is understandable if some people evaluate these projects from the perspective of geopolitics, hinting that China and India are in a race to win strategic trade routes.

However, this way of thinking also contributes to the complex situation facing Central Asia, which has long been beset by backward infrastructure and only fringe participation in globalization.

China is likely to be happy if India can join the ranks of improving infrastructure networks in the region. As a key strategic location connecting East Asia, Southeast Asia and Central Asia, India can promote infrastructure development that will be conducive to economic development in the entire region.

India's government has called for efforts to make the country a manufacturing hub through measures such as promoting infrastructure development. It is normal to see India strive to open up new trade routes in Central Asia by financing infrastructure projects such as rail links at the same time as it develops the country's export-oriented economy.

According to the FT report, India will spend $500 million to develop Iran's Chabahar port and related infrastructure, but the article also quoted one Pakistani official as saying the commitment was "peanuts" compared with China's promise to invest $46 billion in a network of railways, highways and pipelines to connect western China to Gwadar Port.

However, the amount of money India spends on the project is not that important. What matters more is that India is now willing to make an active contribution to promoting regional infrastructure development.

In this regard, China is unlikely to engage in strategic confrontation with India. It is clear that the improvement of infrastructure in Central Asia will also provide opportunities for Chinese multinational corporations, which hope to find potential overseas markets in the region.

China and India will both play a vital role in promoting infrastructure development in Asia. In fact, the two countries have begun to seek cooperation with each other in this regard via the China-proposed Asian Infrastructure Investment Bank.

The author is a reporter with the Global Times.

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