KASHMIR - Wednesday, June 13, 2012 -
Earlier analysis of the Silk Route in this column focused on the romanticization and realities in opening the route. To recap, while revisioning the route, the existing realities, economic potentials along with infrastructure and human capacities as it is today has to be kept in mind, before making recommendations.
While revisioning the route, an analysis of what China is pursuing today along the Silk route is essential for most of this route lies on its territory. Any recommendation or input without this understanding would be futile and a wasted effort.
First and foremost, it should be understood, 'Silk Route' was a misnomer. Silk ceased to be the primary commodity in this route, when it was christened so, only few centuries ago. It was the myths and legends relating to how silk reached Europe from China and the fascination of the European elites towards silk that made this route famous, and not the actual commodities that was traded across.
Today what does China intend to do with this Silk Route? Two major initiatives of China have been to convert this route into a major rail route and a gas corridor.
The rail route starting from Beijing and Shanghai aims to link up with the King's Cross in London, cutting across Central Asia and Europe. The primary objective of this conversion into a rail route is to enable China to pump in the goods it produced in the mainland into Europe. The target is Europe and the beneficiary is the Chinese manufacturing sector.
In this process, China also plans to develop its western sectors, especially Xinjiang and perhaps Tibet, where there is a high level of discontentment against Beijing's rule. As a collateral, the Shanghai-Beijing-London rail route would also make the western regions of China more integrated with the rest of mainland.
The European Union imports close to 18 percent of its total imports from China, and exports close to nine percent of its total exports to China. The bulk of this trade between EU and China takes place through the circuitous sea lane; by constructing a rail route linking Shanghai with London, China aims to increase the volume of trade with less cost, but at a faster pace.
With the gas corridor along the Silk Route, on the other hand, Beijing is aiming to obtain gas for its energy-hungry industries in Southern China, all the way from Northern Africa, Middle East, and Central Asia. This gas corridor along the Silk Route is likely to be multiple ones criss-crossing numerous sub-regions. The idea of constructing a gas pipeline across the Karakoram Highway (not to be confused with Karakoram Pass) was a part of this strategy, linking Karachi and Gwadar ports in Pakistan to Kashgar in Xinjiang via the Sust dry port in the Northern Areas and the Khunjerab Pass.
Another gas corridor criss-crossing the Silk Route, according to Chinese strategy, is to get from the Siberian coast in Russia towards Southern China, and perhaps linking the Koreas.
Though there is a long-term idea (emphasis on "idea") to link Kunming with Iran via the Stillwell route, Northeast India, Bangladesh, rest of India and Pakistan, this corridor is unlikely to materialize given the intra-regional political problems within South Asia. It would be a totally different issue, if the region as a whole were not generations behind in catching up with Beijing's long-term plans and designs to link China with the rest of Asia and Europe through gas corridors.
China has grand plans vis-a-vis revisioning the Silk route as explained above. If we have to sell an idea to them in terms of re-opening the South Silk routes from Jammu and Kashmir, Himachal, Sikkim and the Northeast, it should be equally a grand plan, that would allure them, and not a piecemeal peanut plan, that would make the Chinese disregard it entirely.
Are we ready with a master plan to re-open the Silk Route, with substantial goods, and with better infrastructure? Or are we focusing on only traditional goods including apples, saffron, medicinal herbs, butterflies, yak tails, and orchids? What would China be interested in, if we have to hook up to their east-west corridor along the new Silk Route? And what would China be interested in trading with South Asia along the Silk route today cutting across the Himalayas in the north, and Brahmaputra and Irrawady rivers in the east?
If we consider the reopening, only between the border regions of J&K, Himachal, Sikkim and Northeast as origin and destination of goods, we are talking about border trade, which China may not be very interested in. It would go the Nathu La trade way; started with much fanfare five years ago and touched zero last year. If we have to revision it as an international trade, the problems of border regions as explained in the previous column needs to be addressed.
The academic and business community have to sit together and do their homework and draft a long-term plan and strategies to pursue them. The trick is to find an answer to how to minimize the negative fallouts of international trade on the border regions, and ensure that "trade and prosperity does not cross through the border regions" but yet to open the Silk route in the Southern corridor.
The trick is also to find out how to make maximum benefit in hooking up with the east-west corridor that China is building along the Silk Route, yet not become a dumping ground for its cheap products.
The above cannot be done by a single individual or institution. There is a need to work together between the Indian regions in question and within, and between multiple institutions - academic, business, strategic and government. We are already late in this process; the border regions, have to make the initial step, for it is in their interest.
An initiative from Delhi would always focus on the interests of North and South blocks and not essentially that of the regions. There is also a need for local inputs from the regions; it is unfortunate that while media and NGOs have mushroomed in these regions, there are not sufficient research institutions and think tanks in the regions, who undertake quality research.
Let us start this process today at our own levels, instead of waiting someone to take the lead.