Europe-Middle-East-India Trade Corridor To Rival China’s BRI

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Europe-Middle-East-India Trade Corridor To Rival China's BRI

New Delhi- A broad alliance of states on Saturday unveiled ambitious plans to create a modern-day Spice Route linking Europe, the Middle East and India, boosting trade ties with potentially wide-ranging geopolitical implications.

The United States, Saudi Arabia, the European Union, the United Arab Emirates and others launched the initiative to link railways, ports, electricity and data networks and hydrogen pipelines on the sidelines of the Group of 20 summit in New Delhi.

Although heavily trade-focused, the scheme could have wide-ranging implications — including developing contacts between long-time foes Israel and Saudi Arabia.


Signatories hope it can help integrate India’s vast market of 1.4 billion people with countries to the west, offer a counterbalance to lavish Chinese infrastructure spending, boost Middle Eastern economies and help normalise relations between Israel and Gulf Arab states.

“This is a real big deal,” said US President Joe Biden at the launch event, calling the plan “historic”.

European Commission President Ursula von der Leyen said the so-called India-Middle East-Europe economic corridor was “much more than ‘just’ a railway or a cable”.

“It is a green and digital bridge across continents and civilisations,” she said.

One proposed project would link railway and port facilities across the Middle East — including the United Arab Emirates, Saudi Arabia, Jordan and Israel — potentially speeding trade between India and Europe by up to 40 percent.

Pramit Pal Chaudhuri, South Asia practice head at the Eurasia Group, said a shipping container that today travels from Mumbai, through the Suez Canal to Europe could in the future go by rail from Dubai to Haifa in Israel and on to Europe, saving both money and time.

At present, the Suez Canal is a major bottleneck to world trade, handling roughly 10 percent of global maritime trade but often beset by disruptions.

In March 2021, the giant container ship Ever Given caused a nearly week-long stoppage in Suez traffic after it became lodged diagonally in the waterway.

‘Game changer’

At the same time, the plan neatly aligns with several of Washington’s goals in the Middle East, and officials say the United States is keen to see the projects take flight.

Biden’s administration is actively prodding Riyadh, a major oil producer and security partner, to normalise ties with Israel after decades of conflict and closed borders.

Saudi Arabia has never officially recognised Israel.

US involvement could also help mend deeply damaged ties between Riyadh and Washington, which frayed after the US-Iran nuclear deal and the 2018 murder of dissident journalist Jamal Khashoggi.

According to details seen by AFP, the economic corridor would develop infrastructure to enable the production and transport of “green hydrogen”.

It would also strengthen telecommunications and data transfers through a new undersea cable connecting the region.

French President Emmanuel Macron said work was now needed to make the plan “real”.

All the projects could also help oil-soaked Middle Eastern states wean their economies off dependence on fossil fuels.

Michael Kugelman, South Asia Institute director at The Wilson Center, said the plan could be a significant response to China’s much-vaunted Belt and Road Initiative.

The so-called BRI has spread Chinese influence, investments and commerce across Europe, Africa, Asia and Latin America.

“If finalised, it would be a game changer that strengthens connectivity between India and the Middle East and would aim to counter BRI,” Kugelman posted on X, formerly known as Twitter.

Really Big Deal: Biden |Will Give New Direction: Modi

Plans for an ambitious India-Middle East-Europe Economic Corridor were unveiled on Saturday with Prime Minister Narendra Modi asserting that India does not limit connectivity to regional borders and believes that it can play a key role in strengthening mutual trust.

At the launch event of the ‘Partnership for Global Infrastructure and Investment’ and ‘India-Middle East-Europe Economic Corridor’ during the G20 Summit, Modi said today “we all have reached an important and historic partnership”.

He said in the times to come, it will become an effective medium for economic integration of India, the Middle East and Europe. “It will give a new direction to connectivity and sustainable development of the entire world,” the prime minister said.

“It will drive sustainable development for the entire world,” Modi said.

At the launch, he also said strong connectivity and infrastructure are fundamental basis for humanity and India has always laid strong emphasis on this.

“We are laying a strong foundation for a developed India. Through PGII (Partnership for Global Infrastructure and Investment), we can play a key role in filling infrastructure gap in Global South countries. India does not limit connectivity into regional borders. We believe connectivity can also play a key role in strengthening mutual trust,” he said.

Modi stressed on respecting sovereignty and integrity of all nations. He also stressed on promoting financial viability rather than debt burden as well as on following all environmental guidelines.

“With such a major step on connectivity, we are sowing the seeds for future growth,” he said.

US President Joe Biden said he was proud to announce that they have finalised a “historic agreement” for the new India-Middle East-Europe Economic Corridor. “This is a big deal,” said Biden. “This is a really big deal.”

“As key part of this corridor, we are investing in ships and rails, that extends from India to Europe connected by the UAE, Saudi Arabia, Jordan and Israel. It will make it far easier to trade. I want to thank sponsors and particularly Prime Minister Modi and (Saudi Crown Prince) Mohammed bin Salman,” he said.

European Commission President Ursula von der Leyen hailed the agreement on the corridor, saying this is nothing but historic. “It will be the most direct connection to date between India, the Arabian Gulf and Europe with a rail link that will make trade between India and Europe 40 per cent faster,” she said.

French President Emmanuel Macron said it is about having a first global green trade route as hydrogen is also part of this project.

German Chancellor Olaf Scholz said, “We have to ensure that we implement it successfully and Germany is committed to contribute in that regard.”

The launch of the new corridor is a milestone in strengthening global integration, Italian Prime Minister Giorgia Meloni said. She thanked Modi, Biden and all others who made it possible.

“This will scale up our economic growth. Italy is ready to play a decisive role in this initiative and we want to contribute in building bridges between the Mediterranean and Indo Pacific,” Meloni said.

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