Colombo, March 29. China will suffer significant material and geopolitical losses from the attack launched by the US and Israel on Iran. Amid the ongoing conflict, its Belt and Road Initiative (BRI) projects related to Iranian ports, rail corridors, and energy infrastructure face increased instability and security risks, according to a report.
"Located at the crossroads of global commerce, the countries in the Middle East are a logistical bridge and an emerging ground for strategic investments. China has been investing in Iran since 2005. Since Chinese President Xi Jinping's visit to Tehran in 2016 to sign the Belt and Road Initiative, Beijing has been working to make Iran a cornerstone of its Middle East strategy, establishing a base in the region to counter the influence of the US and setting up trade corridors to Africa and Europe," stated a report in Sri Lanka's Daily Mirror.
"In 2021, Beijing signed a comprehensive strategic partnership agreement with Tehran, pledging $400 billion in long-term infrastructure in Iran and in the purchase of Iranian oil. With the outbreak of the war, China's grand strategy lies in tatters. Chinese investments in fixed assets are at great risk; the supply of oil from Iran that China was getting at concessional terms is now uncertain. With a regime change in Iran imposed by Washington, China also stands to lose the trade corridors through Iran that it had planned," it added.
Through Iran, China has extended its presence in other nations of West Asia, which are rivals of Iran. With Iran targeting other Gulf nations amid the ongoing conflict, Chinese investments there are also threatened. In order to protect its investments in Iran and the supply of Iranian oil, China is not in a position to urge Iran to stop carrying out attacks on other nations in West Asia, some of which host American military facilities.
China has been investing heavily in railways in Iran. Apart from railways, Chinese state-owned and private companies are also investing in key infrastructure projects like high-capacity hospitals with nearly 4,000 beds, metro services, automobile facilities, mining, and highways. China has also been cooperating with Iran on several nuclear-related projects in Iran, including the contracts for the construction of two 2,000 MW nuclear power plants, a number of 1,000 MW nuclear power plants, and a heavy water reactor in the Iranian city of Arak. According to the report, China had to slow down on some of these nuclear projects after the US imposed sanctions on Iran.
Furthermore, China is expanding its Digital Silk Road and Green Silk Road Initiatives in Iran. China has also been helping Iran in building smart cities with public Wi-Fi, smart buildings, mobile payments, e-commerce, and e-governance. Under the Green Silk Road, Chinese companies have been involved in renewable energy projects in Iran, such as solar power, hydro-electricity, and bio-fuel. Among all nations that have signed BRI agreements with China, the projects in Iran have the highest potential for overall return on investment for Beijing.
"Beijing had wanted an Iran with nuclear ambitions that could be used as a counterweight to the US. But the Midnight Hammer of last June and the ongoing Epic Fury have devastated the nuclear infrastructure of Iran and its conventional long-range missiles and drone capabilities. Iran’s uranium enrichment facilities have been crippled, its military backbone broken, and its weapons stockpile shattered," the report said.
"Iran can no longer destabilise the Middle East at China's behest and keep Washington busy there. Belt and Road projects tied to Iranian ports, rail corridors, and energy infrastructure now face heightened instability and security risks. A secure overland energy corridor from Iran to China, insulated from US naval power, has been reduced to uncertainty. The strategic equations have changed overnight to the detriment of China," it added.