Context: Recently, China has hinted at a shift in how it will pursue its signature Belt and Road Initiative (BRI) amid growing concerns about debt repayments from many partner countries because of the coronavirus (COVID-19) pandemic.
Background

• In recent weeks, China has faced calls from countries in Asia and Africa to delay or waive debt repayments.
• China’s financial assistance includes grants, interest-free loans and preferential loans.
• In its recent report, China said it would focus on “achieving shared growth through consultation and collaboration” and would “work with BRI partners for mutually beneficial outcomes”.

About Belt and Road Initiative(BRI)

• It consisting of the land-based belt, ‘Silk Road Economic Belt’, and ‘Maritime Silk Road’, aims to connect the East Asian economic region with the European economic circle and runs across the continents of Asia, Europe and Africa.
• It is China’s ambitious project announced in 2013. It covers about 65% of the world population, 60% of the world GDP and over 70 countries in six economic corridors.
• China is spending almost $1 trillion to revive and renew the overland and maritime trade links between China, Europe, West Asia, and East Africa through construction of modern ports linked to high-speed road and rail corridors.

The initiative defines five major priorities:

• policy coordination;
• infrastructure connectivity;
• unimpeded trade;
• financial integration;
• and connecting people.

Financial assistance under BRI: cheque book diplomacy

• China’s financial assistance included grants, interest-free loans and preferential loans. 
• Interest-free loans which are offered by the Chinese government are applicable for debt relief.
• If any debtors encounter difficulties to pay on time, there may be tailored plans including rescheduling or China increasing funding to help related projects resume operation and return profits.
• Repayments could be solved by China adding grants to help bring projects back to life, conducting debt-to-equity swaps, or hiring Chinese firms to assist in the operation.

India’s concerns with BRI:

• India argues that the BRI and China-Pakistan Economic Corridor project violates its sovereignty because it passes through the part of the Pakistan-occupied Kashmir that belongs to India.
• Debt trap: BRI projects are pushing recipient countries into indebtedness, do not transfer skills or technology and are environmentally unsustainable.
• China is planning to extend the CPEC to Afghanistan. Meanwhile, Maldives, Nepal, Myanmar and Sri Lanka are eagerly pursuing potential BRI projects.
• Through OBOR, China is countering the strategies of India in North East region and is promoting its greater presence in North East India, part of which China claims as its own territory. This may have a security impact on India.
• Tense bilateral relations with China, deep mistrusts and India’s growing concerns over Chinese hegemonic intentions in South Asia and Indo-Pacific region make it practically unlikely that India will ever consider joining this project.
• Military deployment: The fact that the Chinese have begun to deploy 30,000 security personnel to protect the projects along the CPEC route makes it an active player in the politics of the Indian sub-continent. Clearly, this is a case of double standards.