| PYQ Relevance: Mains: Q) The China Pakistan Economic Corridor (CPEC) is viewed as a cardinal subset of China’s larger ‘One Belt One Road’ initiative. Give a brief description of CPEC and enumerate the reasons why India has distanced itself from the same. (150 Words, 10 Marks). (UPSC CSE 2018) Q) What introduces friction into the ties between India and the United States is that Washington is still unable to find for India a position in its global strategy, which would satisfy India’s National self-esteem. (UPSC CSE 2019) Prelims: ‘Belt and Road Initiative’ is sometimes mentioned in the news in the context of the affairs of (UPSC CSE 2016) (a) African Union (b) Brazil (c) European Union (d)China |
Note4Students:
Prelims: Global Issues; West Asia; East-Europe Economic Corridor (IMEC);
Mains: Global Security Issues; West Asia; Trades;
Mentor comment: In a world of shifting geopolitical landscapes, India embarked on a grand vision to reshape its economic and strategic ties with the world. At the heart of this vision lay the India-Middle East-Europe Economic Corridor (IMEC), a path-breaking initiative that promised to transform the way India engaged with its partners across the Eurasian landmass. The story began in September 2023, when India, along with the European Union, France, Germany, Italy, Saudi Arabia, the United Arab Emirates (UAE), and the United States, signed an agreement to bring IMEC to life. This ambitious project, designed under the Partnership for Global Infrastructure and Investment (PGII), aimed to stimulate economic development through enhanced connectivity and integration between Asia, the Arabian Gulf, and Europe. For India, IMEC represented a strategic opportunity to assert its presence on the global stage and counter the growing influence of its rival, China.
Let’s learn.
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Why in the News?
After India signed a landmark 10-year bilateral contract with Iran (Chabahar Port), the U.S. State Department has warned of potential sanctions for any entity considering business deals with Iran.
- In the past, American sanctions had delayed the project, which was conceived in 2003.
- Practically, the signing of a long-term agreement marks a significant milestone in India’s infrastructure and trade partnership with Iran.
- However, considering US sanctions, India also needs to focus on the next upcoming IMEC Project which is stalled due to West Asian tensions.
| How IMEC is countering the Belt and Road Initiative (BRI)?: IMEC has two corridors – the East corridor (India to Arabian Gulf) and the North corridor (Arabian Gulf to Europe). 1. The East Corridor connects the Indian ports of Kandla, Mumbai, and Mundra to UAE’s ports like Fujairah, Jebel Ali, and Abu Dhabi by sea. 2. The North Corridor link is the Railroad link through Saudi Arabia, and Jordan to European regions like Haifa, Marseille, Messina, and Piraeus.The Railway network for cross-border ship-to-rail transit is based on electricity, digital connectivity, and clean hydrogen export infrastructure. Significance of IMEC over BRI: It secures regional supply chains by overcoming Pakistan’s obstacle to overland access. It increases Trade Accessibility and Facilitation which will be effective in countering China’s Belt and Road Initiative (BRI) as it will reduce time by 40% and cost by 30% of transporting goods from India to Europe. Hence, the U.S. is also a major stakeholder. |
What is the impact of the recent Gaza War on IMEC? (Challenges faced)
- War in Gaza led to project stall; in fact, Iran is threatening to close the Strait of Hormuz.
- For example, Adani Group’s plans for Haifa port expansion halted.
- The present Gulf region is facing trade and security issues due to ‘Houthis’ blocking Red Sea access for Israel and its allies.
- Due to increased shipping time and insurance costs (due to unsafe routes), the trade barriers and eventually inflation have also being increased.
The Role of Oman and Egypt in Strengthening IMEC: (Way Forward)
- Oman as an Alternative: Oman’s ports in the Arabian Sea, away from Iranian influence which is the closest and most direct link to Indian ports. Secondly, Oman also has good relations with all its stakeholders
- Extending to Egypt: Egypt can act as an alternate spur through Egypt to Mediterranean ports in Europe. This will provide a safe and direct sea route to Europe. Secondly, Egypt’s inclusion balances regional dynamics and has good relations with Israel, Europe, and the U.S.
Conclusion: Today, as the world watches with bated breath, IMEC stands as a testament to India’s vision and determination. It is a story of how a nation, once constrained by geography and politics, found a way to break free and forge its path in the global arena. And as the story continues to unfold, one thing is certain: IMEC will forever change the way India engages with the world, and the world engages with India.
