There are reports that India, US, Saudi Arabia and the European Union are planning to announce a multinational rail and ports deal on the sidelines of the G20 summit on Saturday with an aim to counter China’s ambitious Belt and Road Initiative (BRI).
The mega infrastructure deal has been in the works for awhile, and is likely to be a major highlight of the ongoing G20 meeting in Delhi. The deal is expected to be announced by Prime Minister Narendra Modi , US President Joe Biden and the leaders of the Gulf state.
The plan seeks to bolster trade between India, the Middle East as well as Europe and establish a modern-day Spice Route to bind regions that account for about a third of the global economy.
Media reports say the plan would include a slew of data, rail, electricity and hydrogen pipeline projects.
One proposed project would link railway and port facilities across the Middle East — including the United Arab Emirates, Saudi Arabia, Jordan and Israel — potentially speeding trade between India and Europe by up to 40 percent.
Reports said that India will be connected through shipping lanes from ports in the region.
Additionally, a US-supported proposal to expedite land-trade routes between Gulf Arab countries and the Mediterranean Sea has also been discussed among Israel and Gulf nations
The plan is expected to be a possible game changer for global trade, presenting an alternative to China’s wide-ranging strategic infrastructure investments.
“The India – Middle East – Europe economic corridor” is “nothing less than historic” European Union leaders are expected to say when the details of the plans are unveiled.
President Biden’s deputy national security adviser,Jon Finer, was reported saying the proposed memorandum of understanding include the United States, India, Saudi Arabia, the United Arab Emirates, the European Union and other countries.
He said first that the corridor would increase prosperity among the countries involved by increasing the flow of energy and digital communications.
Second, the project would help to address the lack of infrastructure needed for growth in lower- and middle-income nations.
And third, Finer said it could help “turn the temperature down” on “turbulence and insecurity” coming out of the Middle East.
Countering China
The US push comes as Saudi Arabia and the UAE, both old allies of US, have been strengthening their ties with China as they seek to enhance relations with rapidly growing eastern economies.
China has also boosted ties with the Middle East of late, helping to broker a detente between Saudi Arabia and Iran earlier this year.
Last month, the oil-rich Gulf states announced their intention to join the BRICs group of emerging market nations, with China playing a leading role in this move.
The plan is being seen as an ambitious effort by Washington to counter China’s Belt and Road initiative that sought to connect more of the world to the country’s economy.
It is being announced just a month before China’s Xi hosts global leaders for the third Belt and Road Forum in Beijing. Russia’s Vladimir Putin is also expected to attend the event.
The US in recent years has sought to counter President Xi Jinping’s ambitious infrastructure plan, which has financed hundreds of billions of dollars worth of projects in emerging markets.
Of late, China’s BRI has been facing a series of troubles due to rising loan defaults and slowing down on investments.
