Jacob Goldberg
The Diplomat
August 29, 2014
In balancing its relations with China and India, Myanmar is continuing a well-established practice.
Following her recent participation in the ASEAN Regional Forum in Naypyidaw, Myanmar, which included bilateral meetings with counterparts from 11 countries, Indian External Affairs Minister Sushma Swaraj declared, “I myself feel that the visit was very successful.” Her trip will set the stage for Prime Minister Narendra Modi’s upcoming visit to Myanmar in November. These engagements come as public and government opposition to Chinese infrastructure projects in Myanmar rises, offering India the opportunity to fill the strategic gap left by China’s waning influence in the Southeast Asian country.
While China remains Myanmar’s largest trade partner and supplies the bulk of the Myanmar Armed Forces’ weapons, the Myanmar government seems to be losing interest in Chinese investment in its infrastructure.
On July 18, Myanmar’s Ministry of Rail Transportation announced the cancellation of an agreement with the Chinese government to build a railway connecting Kunming in China to Kyaukpyu in Rakhine state. Ministry director Myint Wai attributed the cancellation to public opposition.
China’s ambassador to Myanmar Yang Houlan exposed Beijing’s discontent when he countered the ministry’s claim, saying in a July 25 press conference that the project would proceed with the support of the Myanmar government and people. He also claimed that opposition to the project has been overstated by the Myanmar government.
The Chinese envoy’s claims have not been corroborated by the Myanmar government.
The 1,215 km Kunming-Kyaukphyu railway, proposed in a 2011 memorandum between the Chinese and Myanmar governments, would have followed the route of an existing pipeline that connects gas fields in the Andaman Sea to refineries near Kunming. The $1 billion pipeline was fully funded by the Chinese government.
A recent Reuters report said the pipeline has been delivering only 15 percent of its intended annual capacity to its destination in Kunming.
Similarly, the bulk of the $20 billion cost of the now-defunct railway project was to be borne by the China Railway Engineering Corporation (CREC).
However, in the three years since the memorandum was signed, public opposition to the project has hampered all progress on construction. Political parties and civil society groups in Rakhine state, through which the railway would have passed, have protested the construction of the pipeline as well as the railway, citing environmental and social concerns. Groups in Rakhine state also oppose the practice of exporting local natural resources out of Rakhine territory.
The cancellation of the Kunming-Kyaukpyu railway project follows a growing trend of opposition to Chinese investment in Myanmar’s infrastructure. In 2011, public opposition to the multi-billion dollar Myitsone Dam, another Chinese project, prompted President Thein Sein to suspend the project indefinitely.
Further exposing the vulnerability of Chinese infrastructure projects in Myanmar was a statement by a Chinese firm that signed deals with Burma’s former military rulers to build hydro dams in the Southeast Asian country. The Power Construction Corp of China recently announced that Myanmar could renegotiate the terms of those deals in order to allocate more power toward domestic consumption, deviating from the initial plan to direct 90 percent of the power generated by these dams to China.
Wasbir Hussain, director of the Centre for Development and Peace Studies in Guwahati, describes China’s engagement with Myanmar as the pursuit of three objectives. First, China seeks to use Myanmar’s natural resources to meet its domestic demand. Second, China wants to expand its access to the Bay of Bengal and the Andaman Sea in order to develop a modern maritime reconnaissance system. Third, China is bent on denying India strategic space across South Asia.
The cancellation of the Kunming-Kyaukpyu railway project, the lackluster performance of the China-Myanmar gas pipeline and the offer to renegotiate dam deals with China endanger all of Beijing’s objectives.
At the same time, New Delhi seems to be achieving its strategic goals in Myanmar with increasing ease, allowing India to fill many of the remaining gaps in its Look East policy.
While Chinese projects Myanmar are consistently falling prey to public disapproval, several infrastructure projects that will connect Myanmar to India’s northeast states appear to be making progress, even in the face of similar local opposition.
The Kaladan Multi-Modal Transit Transport Project, which will connect India’s Mizoram State to a deep-sea port in Sittwe, is projected to be completed by 2015. The project will expand the capacity of the Sittwe port facility, giving India’s northeast states access to a harbor in the Bay of Bengal and connecting Myanmar to Kolkata port. Another project, the India-Myanmar-Thailand trilateral highway corridor, is projected to be completed by 2016. Earlier in July, the governments of India and Myanmar also pledged to proceed with the creation of a highway bus route that will connect Moreh in India’s Manipur state to Mandalay. It is set to be completed in October.
In a recently released report titled “Transforming Connectivity Corridors between India and Myanmar into Development Corridors,” former Indian ambassador to Myanmar VS Seshadri announced that a broad gauge rail line that is supposed to be built in Imphal by 2018 could be extended to Moreh and then on to Kalay in Myanmar’s Sagaing division with international funding, which would be another crucial link in regional connectivity. The report listed several other India-assisted developmental projects in Myanmar, which include industrial training centers in Pakokku and Myingyan and an India-Myanmar Centre for Enhancement of Information Technology Skills.
Groups such as the Kaladan Movement in Rakhine state and the Chin Human Rights Organization have raised concerns about the Kaladan project due to the lack of environmental impact assessments throughout the planning process and the absence of any effort by either the Indian or Myanmar governments to consult with populations living along the route of the project.
Nonetheless, this opposition seems to have had little impact on the progress of the project.
According to Madhurjya Kamar Dutta, program manager for trade and investment facilitation at the Mekong Institute for Development and Cooperation, India-funded infrastructure projects will facilitate the emergence of a new Mekong-India economic zone. The Moreh-Mandalay highway will fill a crucial gap in the Asian Highway network as well as connect India’s northeastern states to the East-West Economic Corridor, which connects Mawlamyine in Myanmar to Da Nang port in Vietnam. Thus, India will achieve a level of connectivity throughout Southeast Asia similar to that which China has enjoyed for centuries.
Myanmar’s apparent new preference for India-sponsored infrastructure projects also positions Naypyidaw to play an active role in the U.S. policy of rebalancing its economic and strategic focus toward Southeast Asia. During a recent visit to India, U.S. Defense Minister Chuck Hagel said, “The United States strongly supports India’s growing global influence and military capabilities including its potential as a security provider from the Indian Ocean to the greater Pacific.” As Myanmar falls further under India’s influence, it also embeds itself in American foreign policy, which is seen as a bulwark against China’s strategic ambitions in the region.
Both Indian and Chinese infrastructure projects in Myanmar have faced public opposition, but only China’s plans have unraveled as a result, while India’s projects have remained intact. It is possible the Myanmar government has found a new patron in Asia. But it is more likely that these events follow Myanmar’s well-known practice of balancing the great powers against each other. By challenging China’s monopoly, the Myanmar government is opening strategic space to create further competition between India and the United States on the one hand and China on the other, affording the Myanmar government a more comfortable degree of leverage and autonomy in the international arena.
Jacob Goldberg is a Myanmar-based journalist.
