What is Blue Dot Network?
The Blue Dot Network is a joint US, Australian and Japanese initiative which has been officially described as "promoting global, multi-stakeholder sustainable infrastructure development in the Indo-Pacific region and around the world." It is a collaboration of US Overseas Private Investment Corporation, in partnership with Australia’s Department of Foreign Affairs and Trade and the Japan Bank for International Cooperation. It was launched on the sidelines of the 35th ASEAN summit in Thailand, November 2019.
As for the operations of the Blue Dot Network, it is referred as "a multi-stakeholder initiative to bring together governments, the private sector and civil society to promote high-quality, trusted standards for global infrastructure development".
In simple terms, the Blue Dot Network is a rating mechanism which would evaluate and certify infrastructure projects in the Indo-Pacific region to check there feasibility and sustainability. This grading would be on multiple parameters such as debt, environmental impact, labour standards, etc. However, unlike the Belt and Road Initiative, the Blue Dot Network would not offer public funds or loans for any infrastructure project.
Is Blue Dot Network a challenge to BRI?
The Blue Dot Network is widely assumed as the USA's response to China's Belt and Road Initiative, but the two schemes are fundamentally different.
Belt and Road Initiative: Under the BRI, China's state-owned companies finance international projects in third world poor countries. Here China provides everything from concrete, steel and workers to cash. The loans granted by China usually are at a concessional rate than global rates, developmental loans by the World Bank or other International Financial Institutions.
It is seen that most of the projects undertaken in the BRI have turned as unsustainable and the debtor countries are thus in no position to repay. Sri Lanka, Papua New Guinea, Tonga are some countries which are struggling to pay back to China. This policy has been deemed as debt-trap diplomacy by many.
China in return seeks the land or the infrastructure project itself (as in case of Sri Lanka's Hambantota Port) on lease and strengthens its hold over the geopolitical activities in the region. More often, it is alleged that China aims to use these lands for military purposes which fuel panic in the global order
China's response to Blue Dot Network:
China has downplayed the announcement of Blue Dot Network and responded in its old fashioned rhetoric of West's leg-pulling of China. It is viewed as certification process to set international standards and will certainly imply that Belt and Road infrastructure projects are substandard as per the Blue Dot Network.
But, the standards to be set are not reached through a global consensus of the major infrastructure building nations but only by three countries namely the US, Japan and Australia. Hence, these contradictions will further strain the US-China relationship.
India and Blue Dot Network:
India has expressed its reservations against the China-led Belt and Road Initiative due to its debt-trap diplomacy and strategic encircling of India through its infrastructure projects in the neighbouring countries. The China-Pakistan Economic Corridor especially is a geo-strategic thorn for India. India has flatly refused to become part of the BRI and advises other nations against it as well.
Knowing this fact, the USA with its Indo-Pacific region based foreign policy has begun efforts to get India to join the Blue Dot Initiative. During the 2+2 talks in Washington, December 2019, both countries had agreed to “promote practical cooperation in infrastructure development, cybersecurity, counter-terrorism and regional connectivity”.
The Blue Dot Network in this regard would encourage private investment in infrastructure projects in the Indo-Pacific region. The grading standards will apply to projects in any citizen-centric country where citizens would like to evaluate these projects. This is a democratic and sensible form of operations which India prefers to see in the global order.
Moreover, India's recent closeness with the US and its engagement with other multilateral strategic initiatives like the Quad which also includes US, Japan and Australia makes it more probable for India to agree to become a part of the Blue Dot Network.
Impact on India-China Relations:
India's response to the Blue Dot Network will have a clear reflection on the engagement of India and China both at the bilateral as well as the multilateral levels. India has already refused to be part of BRI. So, becoming a part of Blue Dot Network might put India directly at odds with China.
India at present has to tread a delicate course when global order looks almost confrontational. All major powers are at locking horns with each other. China is becoming more assertive, the USA more unpredictable and Middle East (important to India for energy security) more chaotic.
However, whatever be the decision, India needs to maintain its a balance of its national interests, strategic autonomy and foreign relations.