Regional strategic dynamics in South Asia is in a state of flux since the announcement of China’s Belt and Road Initiative (BRI). China emphasises on the economic aspect of investment in infrastructures and energy projects, but strategic underpinning are very much apparent. China loan has created indebtedness in these countries and has helped Beijing to gain strategic foothold in the region which India considers as core to its security. India’s aid programme though focuses on the neighbourhood, it remains small compared to China and suffers from delivery deficit.

This article explains the Sino-Indian geo-economic competition in Bangladesh in the wake of the former’s launching of the Belt and Road Initiative (BRI) in 2013. Beijing intends to fund various large-scale infrastructure projects in Bangladesh under the BRI which has prompted India to make its own offer of economic assistance to counter the Chinese initiative. The Sino-Indian competition has created challenges and opportunities for Bangladesh. Dhaka is pursuing a balanced policy to manage the competition and advance its own interests.

Pakistan’s largest donor has been the United States of America, granting around $ 70 bn in aid. In 2015, China, as part of its One Belt One Road global ambitions, promised Pakistan $ 46 bn (since revised to $ 60 bn), for a road running from its border to the port of Gwadar. The China Pakistan Economic Corridor (CPEC), is being seen as a ‘fate-changer’ for Pakistan. CPEC could change Pakistan’s fate in more ways than one; this article explores the domestic and regional consequences of China’s involvement in Pakistan, and what this will mean for South Asia and for India.

India’s rejection of the BRI for strategic reasons does not mean it is resistant to Chinese investments, which are—to the contrary—both welcome and rapidly increasing. Indian strategy in this respect is in accord with the changing character of the international system, where strategic competition co-exists with economic cooperation as well as competition. In contemporary international politics, structurally driven conflictive behaviour is modified by high levels of strategic and economic interdependence.

Chinese President Xi Jinping initially proposed to build an ‘economic belt’ and a ‘21st-century Maritime Silk Road’ in 2013 which were formalised as the ‘Belt and Road Initiative’ (BRI) in a document—‘Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-century Maritime Silk Road’—released by the National Reform and Development Commission in 2015.

The successful conclusion of the Belt and Road Initiative (BRI) Summit in Beijing recently has raised a number of questions about India’s strategy to counter the Chinese project. The One Belt One Road (OBOR) initiative which China is implementing along with other partners is primarily aimed at strengthening its economy which was impacted by the global financial crisis of 2008–2009. Through this flagship scheme China will develop large-scale projects in infrastructure such as roads, railway lines, sea ports and airports.