Krish Bhakta & Jai Shenoy — July 14, 2026
Since the dawn of the 21st century, China has emerged as a global economic powerhouse, and its foreign policy has developed alongside that rise. One of the clearest expressions of this shift is the Belt and Road Initiative, which aims to build alliances and expand China’s soft power around the world. At a time of heightened tension between East and West, it is important to explore the BRI’s significance, criticisms, current trajectory, and the different dimensions of the project.
What It Is
The Belt and Road Initiative was launched by China in 2013 and is regarded as the largest infrastructure initiative in modern history. It consists of two main components: the land-based “Silk Road Economic Belt” and the”21st Century Maritime Silk Road.” The initiative intends to promote policy coordination, infrastructure connectivity, trade, and financial integration. By early 2025, more than 150 countries representing 75% of the world’s population and over half of the global GDP had joined the BRI, with a cumulative investment value of nearly $1 trillion. By 2040, the initiative is expected to boost global GDP by 7 trillion annually.
The BRI is built on China’s historic Silk Road, a 2000 year old network of trade routes that originated in China and served to connect civilizations through commerce and culture. This historical legacy serves as a foundation for what China now describes as a “civilizational reconnection” that revives overland Silk Road corridors through Central Asia and rekindles maritime trade routes from Southeast Asia to Africa. By using this historical trade route as a foundation, China positions the BRI as a continuation of a peaceful exchange rather than a geopolitical project.
China’s economic rise provided the foundation for the BRI. Following the major economic reforms China underwent in the 1970s, the PRC was able to lift 800 million people out of poverty while simultaneously becoming the world’s 2nd largest economy. However, in 2013, China faced challenges in GDP growth, industrial overcapacity, and dependence on foreign energy, all of which were exacerbated by the eastern and western divide. The BRI emerged as a strategy to address these challenges by soaking up excess production, securing access to resources and markets, and supporting domestic job creation through overseas investment. In Central Asia specifically, the BRI has strengthened China’s position as the region’s largest trading partner, with total trade reaching $94.8 billion in 2024.
The Belt and Road Initiative was announced in 2013 by President Xi Jinping during two state visits to Central and Southeast Asia. While speaking at Nazarbayev University in Kazakhstan, Xi introduced the idea of creating the Silk Road Economic Belt, a network of overland trade and transportation corridors linking China with Central Asia, the Middle East, and Europe. One month later, during a speech before the Indonesian Parliament, he proposed the 21st Century Maritime Silk Road, which would strengthen maritime connections between China, Southeast Asia, South Asia, Africa, and Europe. Together, these two proposals formed what was initially known as “One Belt, One Road” (OBOR), marking the beginning of China’s most ambitious foreign policy and infrastructure strategy in modern history.
The original OBOR concept centered on improving international connectivity through large-scale investments in transportation, energy, telecommunications, and trade infrastructure. The “belt” referred to a series of overland economic corridors stretching across Eurasia, while the “road” referred to maritime shipping routes, despite its somewhat misleading name. China envisioned railways, highways, ports, pipelines, industrial parks, and logistics centers that would reduce transportation costs, expand trade, and encourage economic integration among participating countries. By drawing inspiration from the ancient Silk Road, Chinese leaders framed the initiative as a revival of centuries-old commercial and cultural exchanges rather than the creation of an entirely new geopolitical system.
As participation expanded beyond the original land and maritime corridors, the name “One Belt, One Road” was gradually replaced with the Belt and Road Initiative (BRI). The new name reflected the project’s broader scope, emphasizing the fact that it was not a single route but a flexible framework encompassing hundreds of infrastructure and development projects across Asia, Africa, Europe, Latin America, and the Middle East. The initiative also expanded beyond transportation to include digital, health, and green belts and roads. This transformation primarily took place in 2016. This transition demonstrated China’s intention to transform the BRI into a long-term platform for international economic cooperation rather than simply a collection of transportation projects.
The BRI was framed as an overall win-win type of deal that promoted shared development of economies and quality of life. Chinese officials argued that infrastructure would reduce poverty, crime, and hunger, while stimulating the economy of both nations, creating a mutually beneficial partnership. Analysts, however, argue that the initiative also advances several strategic interests for China. Economically, the BRI creates new export markets for Chinese goods and services, provides overseas opportunities for Chinese construction companies, utilizes excess industrial capacity, and secures access to critical energy resources and supply chains. Politically, the initiative strengthens China’s diplomatic influence by increasing economic ties with developing nations and encouraging closer cooperation with Beijing on international issues. Strategically, the BRI allows China to diversify its trade routes, reduce reliance on vulnerable maritime chokepoints such as the Strait of Malacca, and expand its long-term presence in regions that have traditionally been influenced by Western powers.
Sectoral Focus Areas
Over the last few years, China’s Belt and Road Initiative has evolved into a highly diversified global strategy, spanning a myriad of sectors to expand its influence. It’s crucial to examine the BRI by each sectoral focus area.
Energy
Energy infrastructure has consistently shown itself to be the largest priority for the BRI, accounting for roughly 43% of total BRI economic engagement. China has taken a bifaceted approach towards this investment, balancing both renewable and non-renewable energy.
- Traditional Energy (Fossil Fuels and Gas)
Although China has committed itself to integrating renewable energy into its economy, it has still relied heavily on fossil fuels in the short term as it sustains its economic dominance. As the world’s largest importer of oil and gas, China’s heavy reliance on these resources makes securing a consistent, uninterrupted supply an urgent national priority. By investing in international fossil fuel networks, it diversifies and strengthens its import pathways, ensuring energy reaches its domestic markets. Additionally, it ensures that even after China starts depending more on renewable energy, the state-owned fossil fuel engineering and construction companies can be sent abroad to remain profitable. It has financed and constructed traditional fossil fuel and gas infrastructure, such as oil refineries and coal-fired power plants, across countries like Nigeria, Saudi Arabia, Pakistan, Kazakhstan, and Uzbekistan. In 2025, it invested an unprecedented $71.5 billion in overseas oil and gas megaprojects through the BRI.
- Green Energy
Often referred to as the Green Silk Road, China’s emerging global sustainable development strategy has gained traction across the world, offering countries a solution to modernize their energy output. With the recent closure of the Strait of Hormuz, which raised oil prices by 65%, countries have started to prioritize reducing dependence on volatile commodities. By dominating roughly 75% of global solar panel manufacturing and producing over half of the world’s EVs and wind turbines, China’s unparalleled clean-tech supply chain makes it strongly equipped to meet such demand. Green energy investment reached a record $18.3 billion, allocated to extensive solar, wind, and waste-to-energy projects.
Information and Technology
Known as the Digital Silk Road, China’s technology component has been a major pillar of the BRI’s strategy. Much of it is state-enabled, powered by partnerships with private and semiprivate technology conglomerates such as Huawei, ZTE, Alibaba, and Tencent. These companies facilitate the innovation and deployment of 5G hardware, telecommunications, AI infrastructure, broadband networks, and fiber-optic cables globally. Playing such an active role now allows them to have a strong foothold in these powerful, cutting-edge industries in the future. For many developing countries, especially those of the Global South, severe capital constraints hinder their ability to invest in such crucial infrastructure on their own. The DSR’s extensive influx of hardware has bridged the digital divide in countries such as Pakistan, Cambodia, Kazakhstan, and Kenya, with some becoming major tech hubs and high-speed data transit corridors as a result.
Metals and Mining
China has started to focus on securing minerals imperative for the green energy transition, such as lithium, cobalt, nickel, copper, and aluminum. The Belt and Road Initiative is able to secure these resources by targeting resource-rich nations like the Democratic Republic of Congo and Indonesia and funding huge infrastructure projects in exchange for some of those resources. Additionally, the BRI can involve building local Chinese-owned processing facilities, allowing China to secure critical supply chains for emerging technologies. For instance, in Indonesia, China utilized the Belt and Road Initiative to develop the Indonesia Morowali Industrial Park, the country’s largest nickel-based industrial site. Through an $8 billion investment that built domestic smelters, China was able to bypass Indonesia’s raw nickel export ban and successfully obtain critical nickel and cobalt reserves required for an aggressive global energy transition. Broadly considered the most resource-abundant continent, Africa specifically has been a primary target of China’s BRI resource endeavors.
Transportation and Logistics
As roughly two-thirds of China’s total maritime trade passes through the narrow Strait of Malacca, China’s trade, and by extension its economy, could easily be jeopardized through its closure. This dilemma has served as the primary geostrategic driver behind the Belt and Road Initiative. The “Belt” refers to overland trading routes connecting Europe and Asia, and the “Road” refers to shipping lanes linking Chinese ports to Southeast Asia, Africa, and Europe. Focusing on building integrated networks of railways, ports, highways, and logistics hubs, China’s goal is to streamline international trade. Some of the BRI’s most notable flagship infrastructure investments are the China-Pakistan Economic Corridor, the China-Laos Railway, the Port of Piraeus in Greece, and the Mombasa-Nairobi Standard Gauge Railway in Kenya.
BRI Foundation
Although the Belt and Road Initiative has been a major source of Chinese dominance globally, it is also incredibly expensive. Since 2013, Beijing has committed over $1 trillion to overseas investments and construction. Without adequate financial support, this ambitious initiative could easily backfire, leaving China economically weaker than before. However, the country is uniquely positioned and has taken proactive measures to secure its financial foundation.
China has a huge domestic overcapacity problem. Decades of state subsidies and weak demand have created an economy in which production drastically outpaces what the local market can absorb. Typically, such a problem can be detrimental to an economy’s prosperity. Factories in this situation would be forced to slash profit margins to drive down prices in a desperate attempt to clear inventory. And if they decided to remove the factory as a whole, it would deprive hundreds, if not thousands, of people of jobs. However, through the Belt and Road Initiative, they have created avenues to clear all their excess products. By financing roads, railways, and other infrastructure projects, Beijing creates a guaranteed, global market to absorb its domestic overcapacity, keeping its factories running and its corporations highly profitable. China wins on two fronts. First, it can keep its factories operating and preserve jobs, and second, it can continue to effectively absorb China’s excessive industrial output.
China’s large-scale lending puts enormous risk on its economy because once billions are committed abroad, repayment depends on borrower countries staying solvent. If those countries fail to pay, China bears the brunt, enduring immense financial losses and the added burden of managing default disputes.
China has accounted for these risks, transitioning from a primary lender to a strict debt collector, using tactics such as brutal and firm collateralization agreements to ensure countries can no longer default on their payments. Additionally, the commercial interest rates are extremely high, more than many countries can afford to pay. As a result, it has led to the fact that China is now collecting more debt repayments than it is issuing in new loans. Therefore, China sustains a constant flow of incoming payments that turns lending into a consistent source of financial returns.
However, running a lucrative initiative only works if there is enough financial stimulus to offer. China utilizes multiple banks to fund its initiatives, but relies primarily on two state-owned policy banks: the China Development Bank and the Export-Import Bank of China. Commercial banks rely on short-term deposits and need steady short-term liquidity to function, so they cannot patiently wait years or even decades for large infrastructure loans to come back. Since the BRI operates on a model of long-term repayments, commercial banks wouldn’t be compatible with the requirements the BRI needs to thrive. Both the China Development Bank and the Export-Import Bank of China don’t fall into this trap because they are government-sponsored. As a result, these policy banks can take a longer time horizon because they are not relying on short-term retail deposits, so they can keep financing large projects even when repayment is slow. The state support lowers their funding pressure, allowing them to meet the demands of countries across the world and practically ensuring that the BRI’s financial guarantees don’t fall short.
Criticisms
Through the Belt and Road Initiative, China has painted itself as a benevolent global leader and the fundamental engine of development for the Global South. However, many countries don’t share such views. The BRI faces intense international criticism, with Western policymakers and analysts frequently raising their concerns about the underlying motives and sustainability. The project certainly helps China, but how much does it help its recipients?
As previously established, China’s lending generates substantial debt repayments, producing a net positive inflow of money. Unfortunately, the countries that bear the greatest burden of this financial manipulation are often the least equipped to withstand it. According to the Lowy Institute, around $22 billion of the $35 billion in debt repayments in 2025 will come from 75 of the world’s poorest and most vulnerable countries, threatening essential spending on basic sectors, such as healthcare and poverty reduction. In this way, the Belt and Road Initiative reinforces the familiar pattern that “the rich get richer, and the poor get poorer,” pushing already vulnerable countries deeper into financial struggles and making it harder for them to become truly sovereign nations.
For China to truly assist a recipient country, the initiative would need to create conditions that allow the economy to thrive for years or even decades. Because these projects are quite expensive, it’d only be fair if the benefits were sustainable and not just short-lived. China often fails to deliver that outcome, however, because while the projects build new infrastructure, they frequently neglect the local economy. Projects such as the Indonesia Morowali Industrial Park have shown that technical roles such as contractors, engineers, materials, and high-paying jobs are commonly reserved for Chinese nationals. As a result, when the Chinese workforce leaves, the host country is often left with only a temporary fix, minimal technology transfer, and a labor force that wasn’t meaningfully developed. In the end, the only lasting effect is often the crushing debt, perpetuating a cycle of dependency more than anything else.
Traditional development lenders use open, multilateral agreements with standardized rules and transparency requirements so borrower countries and external watchdogs can evaluate the terms fairly. China fails to follow that model because terms are negotiated one-on-one in secret, with confidentiality clauses that can prevent governments from revealing the debt terms or even the existence of the loan to their own citizens. This lack of transparency makes it harder for countries to compare prices and evaluate whether they are getting a fair deal. Additionally, secrecy creates space for inflated costs and corruption. Ultimately, deals negotiated through the BRI are heavily skewed in China’s favor, giving it an unfair advantage that can hurt the opposing country’s future.
Every single one of these tactics varies in effectiveness, but the motive behind them is clear: create a dependency on China. In an effort to fill the global power vacuum created by the perceived Western decline and US disengagement, China has been quick to push for a Beijing-centric geopolitical alignment for as many countries as possible. Dependencies created through the BRI serve as a perfect mechanism for forcing individual countries to accept Eastern ideologies and tilt away from the West.
Current Trajectory
While China’s strategies proved successful for a period of time, the momentum eventually slowed down. The accusations of “debt diplomacy” became too intense, the multi-billion-dollar exposure of its state banks grew unsustainable, and partner nations began rejecting proposals for huge infrastructure agreements. Faced with these mounting pressures, Beijing decided to recalibrate.
China has increasingly shifted away from massive, billion-dollar BRI megaprojects and toward smaller initiatives, often worth less than $50 million, as they are less risky and easier to complete quickly. This pivot, known as the “small and beautiful” strategy, allows Beijing to spread capital across more manageable investments without putting excess strain on national banks. The smaller scale also makes projects easier for recipient governments to justify publicly because they deliver more immediate benefits.
Although it has started to prioritize a new framework, it is not absolute. In the future, the country will likely balance past strategies with present ones to achieve optimal return.
Conclusion
The Belt and Road Initiative is far more than a collection of infrastructure projects; it is the centerpiece of China’s long-term strategy to expand its economic, political, and strategic influence across the globe. While the initiative has financed critical infrastructure and strengthened trade for many participating countries, it has also generated significant concerns over debt sustainability, transparency, and geopolitical dependence. As China shifts toward smaller, more targeted investments, the BRI is evolving rather than disappearing, ensuring it will remain a defining force in international relations for years to come. Whether it is ultimately remembered as a catalyst for shared development or as a tool of strategic competition will depend on how both China and participating nations navigate its opportunities and challenges in the decades ahead.
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