Ports in Sri Lanka, Pakistan and Bangladesh China has turned its attention on
building a deep sea port in Kyaukpyui on the Bay of Bengal coast overlooking
the Andaman Islands.
An agreement to construct the deep sea port was
signed by officials of China and Myanmar on November eighth
China has already helped build port in Gwadar in
Pakistan and Hambantota in Sri Lanka. It is also funding the development of the
Chittagong port in Bangladesh. A Chinese
company has major stakes in one of the leading container terminals in Colombo
port. India’s effort to take over the Colombo East Terminal was torpedoed by
Sri Lankan President Srisena recently.
Located on the western coast of Myanmar in
Rakhine state, the scaled-down port, part of a special economic zone (SEZ),
when developed will not be far away from a submarine base India is developing
on its East Coast, close to Vishakhapatnam.
Though the total China-Myanmar investment into
the Kyaukpyu project has been scaled down to $1.3 billion (initial phase) from
the earlier $7 billion figure, the port will be of great strategic significance
to China as it navigates its way into the Bay of Bengal – and the Indian Ocean
-- considered within New Delhi’s range of influence.
China’s investment in the project was reduced
following Myanmar’s concerns of falling into a debt-trap. It had learnt the
lessons from the Hambantota port experience when Sri Lankan government was
forced to give the port on 99 year lease to a Chinese company. The New
Malaysian government under Dr Mathiir Mohammed had cancelled several Chinese
railway projects on the ground that the
projects are uneconomic and that it would make Malaysia indebted to China.
Nonetheless, the port will boost the
China-Myanmar Economic Corridor and will be another road-sea link under
President Xi Jinping’s Belt and Road Initiative (BRI).
Oil and natural gas pipelines are already
functioning between the fishing town of Kyaukpyu and Kunming in China’s Yunnan
province, bordering Myanmar.
For Myanmar, the project promises employment to
thousands and billions in tax revenue in the future, according to Chinese
media. The deal took years to finalise because of differences on financing and
other issues,” the tabloid Global Times said in report.
“At a ceremony in the Myanmar capital of Nay Pyi
Taw, the Chinese consortium led by State-owned conglomerate Citic Group signed
the framework agreement with the Kyaukpyu Special Economic Zone Management
Committee on the development of the deep-sea port,” the report said.
China will invest 70 per cent of the $1.3 billion
while Myanmar will finance the rest in the initial phase, which will include
The signing of the framework agreement marks a
significant step for the port project, which has been stalled since 2015, and
for the continued implementation of BRI, under increased scrutiny because of
cases such as the Kyaukpyu port project.
“Prolonged negotiations fueled criticism of the
BRI, which some foreign critics said could add to local debts and even threaten
other countries’ sovereignty,” the GT report said.
China has maintained that the BRI is an open
platform to facilitate regional and global economic integration and help
countries along the routes with economic growth and job creation.
“The Kyaukpyu project is estimated to bring
100,000 jobs to the local community and will contribute as much as $15 billion
in tax revenue to Myanmar. Once completed, the port will have an annual gross
output of $3.2 billion,” the report added.
The CITIC Consortium comprises China Harbor
Engineering Company Ltd. (CHEC), China Merchants Holdings (International) Co.
LTD (CMHI), TEDA Investment Holding (TEDA) and Yunnan Construction Engineering
Group(YNJG) as well as Thailand’s Charoen Pokphand Group Company Limited (CP