What China Stands to Gain From Myanmar Military�s Coup and What it Means for India
03-February-2021

A democratic India voiced a strong condemnation of the �deeply disturbing� developments in Myanmar on Monday, and said democracy must be upheld in its neighbour. A communist party ruled autocratic China, another neighbour of Myanmar, adopted an evasive and muted tone. It neither condemned nor expressed any concern. The CCP just said that reconciliation is needed between the civilian set-up and Myanmar military or Tatmadaw.

The two vastly different stances adopted by India and China offer a glimpse into who stands to gain as military rule returns to Myanmar after 10 years of gradual, albeit limited, political opening. The Myanmar military staged a coup on Monday, seized power, dismissed the civilian government and imposed a year-long emergency in the whole country.

The geographically strategic location of Myanmar makes it a bridge between South Asia and Southeast Asia, and India needs a good working relationship with the Myanmar government for its diplomatic and strategic initiatives. This is especially due to China�s nefarious designs in Myanmar, which wants to develop it as a geopolitical base against India.

And so, despite Myanmar being ruled by military junta over the years, India has developed close ties and shares a good relationship with Tatmadaw. Last year, despite facing shortage of its own, India handed over INS Sindhuvir, a submarine, to the Myanmar Navy. Tatmadaw responded well to Indian overtures and even allowed India to conduct counter-interagency operations against Indian insurgents groups in Myanmar border areas.

But China has its own designs and wants to use Myanmar as another base in its �string of pearl� strategy against India. Through the string of pearls approach, China intends to encircle India by developing military bases in India�s neighbouring countries and Myanmar has long been on China�s radar.

Burdening Myanmar under Chinese debt trap is the first step of the plan. Of the total direct foreign investment in Myanmar, China now accounts for over 25 per cent. As Myanmar�s second big investor after Singapore, China has invested $21.5 billion in Myanmar so far and accounts for one-third of all Myanmar trade.

Under China-Myanmar Economic Corridor (CMEC) part of the Belt and Road Initiative (BRI), China is funding and developing many big projects in Myanmar that can be used as military bases in future. These infrastructure projects have put Myanmar in massive Chinese debt trap, and accounts for over 40 per cent of the current $10 billion national debt.

But with the Myanmar government recently delaying and cancelling BRI projects and developing some big ticket projects with India, like the India-Myanmar-Thailand Trilateral highway, the Kaladan Multi-modal transit transport network and the planned Special Economic Zone at the Sittwe deep-water port, China saw its own Myanmar designs taking a back stage.

Under CMEC, Myanmar had approved only nine of the 38 projects China proposed and told Beijing it will only approve projects that would be mutually beneficial. One of the suspended projects is Myitsone Dam on Irrawaddy River, a vital project for China to supply electricity to its many projects running in China and Myanmar. China is also concerned with growing influence of Japan and U.S in Myanmar, along with that of India.

The second Chinese step was to control the political machinery. Like in Nepal, where China manoeuvred to install a pro-Beijing and anti-India group government, Myanmar is expected to witness the same thing with military coup. Geostrategic experts say China instigated Nepal to start the border dispute with India.

Myanmar army chief Min Aung Hlaing had met Chinese foreign minister Wang Yi last month in Beijing, and the meeting has been tipped as the precursor to the military�s seizure of power. Calling Myanmar a brother, China praised Tatmadaw�s national revitalization efforts. It was only after Min Aung Hlaing�s Beijing visit, Tatmadaw officials have indicated about a possible coup in Myanmar.

Though China may not have given any explicit support to the military coup, it has only to gain from it. China might have assured the visiting Myanmar military chief to stop arming and funding Myanmar insurgent groups if Myanmar has a pro-Beijing government that can approve Chinese BRI projects in Myanmar, including Myitsone Dam, without any delay.

With this second step done, the third step comes into play: making a country your economically held minnow. When it comes to bilateral trade with India, it stood at just $1.5 billion dollars in 2019-20, nowhere near that of China. A pro-Beijing government in Myanmar means India�s gateway to East is going to have a reduced Chinese, Japanese and American influence.

With China, the bilateral trade is worth $12 billion dollars but if we go by an official Chinese report quoting the Ministry of Commerce of China, export and import between China and Myanmar was worth $168 billion dollars in 2019. That is huge for a small country like Myanmar.

And with over 50 years of military rule and an isolated status in the world, most of the trade between both countries has obviously been China export driven. If the US goes ahead with its threat of sanctions because of the coup, Myanmar will have to turn to Beijing as a shield.

In a nutshell, Myanmar�s economy is largely dependent on China, and with a pro-Beijing government in place, Myanmar may well fall finally into Chinese debt trap by allowing China funded BRI projects that Myanmar has to repay.

If that happens, Myanmar will be reduce to a mere economic minnow of its largest trading partner China, and a hostile neighbour for India�s geopolitical interests. Xi Jinping was the first Chinese leader to visit Myanmar in January 2020. And within a year, China it seems, have a clear advantage over India when it comes to the bilateral relations and influence over Myanmar.