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Singapore and China have inked Memorandum of Understanding (MOU) to promote greater collaboration between companies from both countries in third-party markets along China’s ambitious Belt and Road routes.
The MoU will see the formation of a working group between Singapore’s Ministry of Trade and Industry (MTI), China’s National Development and Reform Commission and Enterprise.
The working group will identify sectors and markets of mutual interest, organise business-matching activities and forums to facilitate third-party market cooperation between Singapore and Chinese companies under Belt and Road Initiative (BRI). Under it, both countries will work with commercial and policy banks, insurers and financial institutions to support financing and project structuring needs of third-party market ventures under BRI by companies from both sides.
Belt and Road Initiative (BRI)
BRI is an ambitious China’s ambitious development strategy and framework that aims to boost its connectivity and trade that will that will connect Asia, Africa, Middle East and Europe. It was proposed by Chinese President Xi Jinping in 2013. It comprises two components viz. the Silk Road Economic Belt and the 21st Century Maritime Silk Road. The initiative is part of China’s revived 21st century Silk Road diplomacy that seeks to push it to take a bigger role in global affairs as a major global power. It is basically investment and trade promotion scheme aiming to deepen economic connections between China and rest of the world.
India is planning to launch major connectivity initiative, connecting Chennai with key Russian port Vladivostok via sea route with an aim to harness natural resources from Northeast Asia and Western Pacific region.
The Chennai-Vladivostok sea route will enable to transfer cargo between Chennai and Vladivostok in 24 days in comparison to over 40 days currently taken to transport goods from India to Far East Russia via Europe.
The proposed maritime route can be transformed into corridor that could juxtapose with Indo-Japan Pacific to Indian Ocean Corridor to counter China’s Maritime Silk Route (MSR) under Border Road Initiative (BRI) which connect entire South East Asia through road, shipping and rail links.
Russia is sensitive to growing Chinese presence in Russia’s Far-eastern region particularly increasing population from China which are settling there. It fears that this pattern could change demographics of Far-east Russia. The growing presence of other countries including India will help to bring balance China’s presence in far east region.
India was first country to establish resident Consulate in Vladivostok in 1992. India’s current engagement with region is limited to isolated pockets such as Irkut Corporation in Irkutsk where Mig and Sukhoi aircraft are built and over $6 billion worth of investments by ONGC Visesh Limited in Sakhalin 1 project. The region has wealth of natural resources such as timber, mineral resources (coal & diamonds) and precious metal deposits (gold, platinum, tin and tungsten) and oil and natural gas.