US President Joe Biden at a press conference on the final day of the G7 summit at Cornwall Airport Newquay, near Newquay, Cornwall, on June 13, 2021. An ambitious infrastructure plan was touted at the summit. Photo: AFP / Brendan Smialowski

The efforts of governments in Asia to finance and build transport infrastructure across the Eurasian continent and beyond continue to chug along, despite disruptions from the war in Ukraine, the deepening global economic crisis and external geopolitical meddling in the region.

Cultural barriers, difficult terrain, scarce capital, and weak legal systems have always been challenges to the development of transport corridors. None of these factors, alone or combined, however, will stop the ongoing process of Eurasian integration. 

The rising backlash in Asia against the prevailing Western neoliberal development model has not, as one might have expected, slowed the pace of Eurasian integration, because viable alternatives to Western capital and expertise exist.

Neoliberalism’s claim that “market forces” will eventually “spread the wealth and grow the pie” is on life support. Some Asian countries not only welcome but seek non-Western sources of capital to meet their development needs, especially in the areas of infrastructure and transport connectivity – not that they hesitate to avail themselves of multilateral aid and G7 money still being offered by Western countries. 

Good intentions but wishful thinking

Just as the June 2021 US-led “Build Back Better World” (B3W) infrastructure initiative turned out to be a flop, so, in all likelihood, will the recently announced (June 2022) US$600 billion joint EU/UK/US plan – “Partnership for Global Infrastructure and Investment” (PGII) – meet the same fate. The failure of the domestic version of B3W in the United States is well known in Asia.

An article last month in the South China Morning Post titled “G7’s Build Back Better World 2.0 won’t fare better than failed predecessor” reflects the growing skepticism in Asia about Western infrastructure initiatives. If the US can’t deliver on infrastructure initiatives at home, what makes anyone think it can deliver on them in Asia?

Most countries in Asia sense that the Group of Seven’s PGII initiative is an impending train wreck. The official statement of Washington (and London/Brussels) to the effect that “the Partnership for Global Infrastructure and Investment will deliver game-changing projects to close the infrastructure gap in developing countries, strengthen the global economy and supply chains, and advance US national security” was widely greeted in Asia as an exercise in hyperbole. 

The European Council president’s official declaration in June with respect to the PGII spoke grandiosely of delivering “up to €300 billion” for development, while the US declared, “Together with G7 partners, we aim to mobilize $600 billion by 2027 in global infrastructure investments.” 

More puffery. 

Meanwhile, China, Kyrgyzstan and Uzbekistan recently announced an agreement to build a 523-kilometer railway (“CKU”) from Kashgar, China, to Tashkent, Uzbekistan, linking up with existing north/south and east/west networks. Sources indicate that final agreements on financing the CKU will be announced at the September 2022 Shanghai Cooperation Organization’s Summit in Samarkand, Uzbekistan.

Eurasian integration goes on no thanks to Western capital. 

If the list of completed projects in Eurasia over the past 10 years is impressive, plans for future initiatives such as the Trans-Afghan Railway or the expansion of the Trans-Caspian International Transport Route are downright mind-boggling. 

After years of overreach and half-baked promises, neoliberalism has been exposed more as a mechanism for offshoring capital and talent than for building long-term economic capacity and enhancing prospects for growth in the recipient countries.

The impoverishment of nations (thanks in part to neoliberalism) has made many Asian governments wary of the razzle-dazzle of Western experts who promise a pot of gold at the end of the rainbow only to abscond with most of the loot, leaving the poor and middle class high and dry. 

This is unacceptable. 

Neoliberalism perceived to weaken nation-state

Asian leaders in the main understand that neoliberalism – the ideology of resource concentration – has weakened nation-states’ ancestral traditions which have historically supported national unity and local customs.

Neoliberalism not only waters down national identity but ends up barring the majority of ordinary folk from creatively participating in the economy; family and community are relegated to the back burner if not the fridge, while pride of place is given to the impersonal metrics of growth and a spurious prosperity. 

This is also unacceptable. 

Moreover, in the minds of many development specialists in Asia, it is no longer axiomatic to say that projects suffer when non-European companies are involved in planning, financing, or designing them. 

Economic crisis in West exposed

Leaders in countries across Eurasia understand that the dominant economic system appears to have reached a turning point. They see it as inherently unstable and riddled with practical contradictions. Consequently, nation-states are increasingly pursuing policies concerned to serve the “common good,” a concept almost wholly unknown to neoliberalism. 

M K Bhadrakumar, a former Indian diplomat, sums up the crisis of the Western economic system: “Fundamentally, the Western economies are facing a systemic crisis. The complacency that the reserve-currency-based US economy is impervious to ballooning debt; that the petrodollar system compels the entire world to purchase dollars to finance their needs; that the flood of cheap Chinese consumer goods and cheap energy from Russia and Gulf States would keep inflation at bay; that interest-rate hikes will cure structural inflation; and, above all, that the consequences of taking a trade-war hammer to a complex network system in the world economy can be managed – these notions stand exposed.”

 Sometimes reality can rise up and bite you in the rear end. 

Indian foreign minister again bats a century

The process of Eurasian integration is further strengthened when Asian states feel independent and self-confident about their ability to raise long-term capital, manage their own economic affairs, and collaborate in win-win partnerships with regional powers and banks. 

Addressing New Delhi’s prestigious Raisina Dialogue in April, Indian External Affairs Minister Subrahmanyam Jaishankar described the attitude diplomats and national leaders should bring to their jobs. “We have to be confident about who we are. I think it’s better to engage with the world on the basis of who we are rather than try and please the world by being a pale imitation of what they are. 

“The idea that others define us, that, you know, somewhere we need to get approval from other quarters, I think, that’s an era we need to put behind. The West’s solutions to connectivity issues are not necessarily India’s solutions.”   

As he has said elsewhere: “If I were to take Europe collectively, which has been singularly silent on many things which were happening [in international relations], for example in Asia, you could ask why would anybody in Asia trust Europe on anything at all.”

In other words, India can take care of itself and make up its own mind when deciding how and with whom to participate in transport and logistics projects in Asia and the Middle East. 

And that view – as seen through a strategic lens – is held by many other countries in Asia. 

Connectivity continues to move forward

Eurasian integration shows no signs of slowing down, despite multiple external and internal challenges. The efforts of governments in Asia to finance and build transport routes across Eurasia will proceed, even if those policies and relationships do not involve Western capital. 

And so, despite the intensity of technical and economic challenges, war in Ukraine (and elsewhere), the shenanigans of the purveyors of chaos, and the unmasking of neoliberalism, Eurasian integration just keeps rolling along much to the chagrin of Western governments and their ideological mandarins. 

Javier M. Piedra

Javier M Piedra is a financial consultant, specialist in international development and former deputy assistant administrator for South and Central Asia at USAID.