At the G20 Summit in New Delhi, a multinational rail and shipping initiative aimed at connecting India to the Middle East and Europe has been unveiled, signifying a strategic challenge to China’s economic endeavors in the region.
This comprehensive corridor, encompassing India, Saudi Arabia, the United Arab Emirates, Jordan, Israel, and the European Union, is poised to stimulate trade, facilitate energy resource transportation, and enhance digital connectivity.
Jake Sullivan, National Security Adviser to President Biden, framed this network as a reflection of Biden’s vision for “far-reaching investments” fostered through effective American leadership and cooperation with other nations. He highlighted how this upgraded infrastructure would bolster economic growth, foster Middle Eastern unity, and transform the region into a center for economic activity, departing from its recent history as a source of challenges and crises.
Biden’s aim is to counter China’s Belt and Road global infrastructure initiative by positioning Washington as an alternative partner and investor for developing nations within the G20 framework. President Biden enthusiastically remarked, “This is a big deal. This is a really big deal.”
During the announcement, Prime Minister Narendra Modi of India, the host of the summit, emphasized that this pact would open up “endless opportunities” for clean energy, electricity, and community connectivity, nurturing dreams for future generations.
Modi added, “Enhancing connectivity with all regions has been a key priority for India,” highlighting that connectivity not only boosts trade but also mutual trust.
While the details remain somewhat limited, US and European officials present at the announcement hailed it as a game-changer, predicting a 40% reduction in trade time between India and Europe.
Notably absent from this announcement was China, indicating that this initiative aims to rival China’s expansive Belt and Road infrastructure project, which was launched in 2013 to connect Asia, Africa, and Europe, making it a clear counterweight.
Crown Prince Mohammed bin Salman of Saudi Arabia, at the summit, mentioned that the new project would incorporate pipelines for electricity, hydrogen, and railways, contributing to international energy security.
The deal is expected to benefit low- and middle-income countries in the region and establish a pivotal role for the Middle East in global commerce. Jon Finer, the US Deputy National Security Adviser, asserted that it would link Middle Eastern nations via railways and ports, facilitating the flow of energy and trade from the Gulf to Europe by reducing shipping times, costs, and fuel consumption.
A memorandum of understanding for this initiative was set to be signed by the European Union, India, Saudi Arabia, the United Arab Emirates, the US, and other G20 partners.
Radha Kumar, an independent analyst, praised the initiative as a “wonderful initiative” offering an alternative to China’s Belt and Road Initiative, which many countries see as rapidly expanding. However, she noted that this project would not necessarily undermine China’s initiative but rather provide much-needed connectivity to India, which was not initially part of the Belt and Road project.
This development coincides with US efforts to broker a broader diplomatic agreement in the Middle East, potentially involving Saudi Arabia recognizing Israel.