The India-Middle East-Europe economic corridor was unveiled during the recently concluded G20 summit in New Delhi. The multi-national transcontinental rail project has been hailed as a ‘game-changer’ and is seen as a challenge to China’s economic ambitions in the region.
The United States is seeking to counter China’s Belt and Road initiative push on global infrastructure by pitching Washington as an alternative partner and investor for developing countries. President Biden, who attended the summit, said the pact would unlock “endless opportunities” for clean energy, boost trade and improve digital connectivity.
Although the exact route, timeline, and financing are not provided, the economic corridor is designed to link India, the Middle East, and Europe consisting of railway and shipping lines passing through the UAE, Saudi Arabia, Jordan, and Israel, and onward to Europe. Saudi Arabia’s Crown Prince Mohammed bin Salman said the new project would include pipelines for electricity, hydrogen, as well as railways and will contribute to international energy security.
The deal will improve bilateral and trade relations between India and the Middle East. It aims to link Middle East countries by railway and connect them to India by port, helping the flow of energy and trade by cutting shipping times, costs, and fuel use. The deal will benefit low- and middle-income countries in the region and enable a critical role for the Middle East in global commerce.
China was conspicuously absent when the deal was announced and the Chinese president skipped the summit. The deal is seen as a counterweight plan to rival China’s massive infrastructure projects aimed to connect Asia, Africa, and Europe. The new project it is also expected to bring significant strategic and economic benefits to India.
Pakistan will certainly miss out on the economic opportunities. The bonhomie between Gulf nations and India is a cause for concern. Pakistan is eyeing massive investments from Saudi Arabia and the UAE but has only received a bailout and rollover of payments. Both countries gave $1 billion each to alleviate the economic crisis and investment deals are mired in bureaucratic and legal hurdles.
The IMEC will also be a challenge to the China-Pakistan Economic Corridor (BRI), which is a section of China’ BRI. The mega project announced a decade ago has not delivered desired results, even though China and Pakistan have denied the claims. On a global scale, this US-China rivalry is bound to further intensify and can adversly affect the current world order.
