Russia Warming to China’s Belt & Road Initiative Projects

When Chinese President Xi Jinping announced the Belt and Road Initiative over a decade ago, Russia’s Vladimir Putin was not enthusiastic about the massive infrastructure drive moving into his country’s “backyard”. Moscow saw landlocked former Soviet countries in Central Asia, such as Kazakhstan and Kyrgyzstan, as within its orbit and the belt and road as a challenge to its dominance.

But a speech by a senior Russian official last week signaled just how much has changed in the decade since. Addressing the Boao Forum for Asia in China’s Hainan Island, Russian deputy prime minister Alexey Overchuk said the Kremlin and Beijing had discussed the possibility of “improving connectivity” between the initiative and the Eurasian Economic Union (EAEU), the free trade area that includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia and fills the geographic space between Western China and Eastern Europe.

Analysts said if the two regional powers could come together and overcome the earlier mutual mistrust, the region could become more connected in trade and transport than ever before. Nevertheless, hurdles remain, they say.

Russia set up the EAEU with the former Soviet states of Armenia, Belarus, Kazakhstan and Kyrgyzstan in 2015 to foster economic integration and to advance its own geopolitical interests in Central Asia. It aimed to mirror the common market and customs union of the European Union, and was built on the foundations of previous blocs going back to the 1990s.

Compliance within the grouping was weak due to the limited power of the Eurasian Economic Commission, the union’s operational arm, and further cracks have emerged since the Russian invasion of Ukraine two years ago.

Western countries have imposed a range of sanctions on Moscow by curbing energy trade with it and banning Russian banks from the global SWIFT payment system. The union has “lost a bit of unity since the outbreak of the Russian-Ukraine conflict”, said Wang Yiwei, director of the Institute of International Affairs at Renmin University of China. He added that some of the EAEU members were “worried about becoming the next Ukraine”.

To repair some of that damage, Moscow has shown increasing willingness to connect its own regional integration project with the Chinese initiative, which all EAEU members have joined.

“Russia is highlighting the Belt and Road Initiative-EAEU coordination again to leverage China’s influence to regain trust from neighboring countries, especially some pushback from Kazakhstan,” Wang said.

Meanwhile, Wang said, China hoped to “further Eurasian integration” to turn bilateral cooperation into multilateral cooperation, adding momentum to its belt and road plans. A case in point was the China-Kyrgyzstan-Uzbekistan Railway, he said.

The 523km (325-mile) line was proposed in the 1990s to give China an alternative route to Europe, without transiting in Russia, and provide potential access for landlocked Uzbekistan and Kyrgyzstan to connect with Southeast and Western Asia.

The plans were folded into the Belt & Road Initiative, which started as a massive infrastructure project, expanded into a geopolitical strategy extending to trade, technological, and cultural cooperation. But construction on the line only started last year. Wang said that movement was the result of Russian support.

While the railway was not a direct partnership with the EAEU, the work only progressed due to the approval of the Kremlin, he said. Cooperation agreements between the EAEU and Beijing were in place as early as 2015 to pursue overland road and rail routes from China to Europe through Central Asia.

But concerns in Moscow and Beijing meant there was little progress, said Yun Sun, director of the China program at the Washington-based Stimson Centre. “Russia had suspicions about Chinese presence in its backyard, and China had been worried about the commercial viability,” Sun said.

“Now with the war in Ukraine and the quagmire Russia is in, arguably Russia has no better option, the desire from Russia to promote economic cooperation is obvious.”

This was apparent in Beijing in May and December when Russian Prime Minister Mikhail Mishustin and Premier Li Qiang pledged to promote synergy between the belt and road and the EEU. Mishustin also met Xi in December.

Wang said Xi and Putin were also expected to discuss plans to coordinate the Belt & Road Initiative and the EAEU in their next meeting, which will reportedly take place in May.

China and Russia have also boosted strategic ties since the war in Ukraine began, increasing the Kremlin’s reliance on the Chinese market while China enjoyed cheaper oil from Russia.

With challenges like the Nord Stream 1, the gas pipeline connecting Russia and western Europe that has been disconnected since 2022, and limited prospects in the European energy market, “Russia aims to expand its presence in Asian and Global South markets through the BRI”, said Zoon Ahmed Khan, a research fellow at the Beijing-based Centre for China and Globalization.

Khan said cooperation between the BRI and the EAEU could “include the development of transport corridors linking China and Russia with other Eurasian countries, the construction of energy pipelines, and efforts to enhance digital infrastructure and trade facilitation mechanisms”.

She said this might also offer the possibility for China to revive the Polar Silk Road, its plan for Arctic transatlantic maritime routes. The Polar Silk Road overlaps Russia’s initiative on the Northern Sea Route and would offer China a quicker alternative trade route to the Suez Canal.

But when it comes to infrastructure projects, challenges remain for China’s engagement with the well-established union, analysts say. Wang said these hurdles included whether the China-Kyrgyzstan-Uzbekistan Railway complied with Chinese or Russian track gauge standards.

At Russia’ Pivot to Asia we believe that while Moscow has some concerns about Chinese influence in Central Asia, improved connectivity infrastructure is a good thing and will help with Russia-China bilateral trade routes and their offshoots across the region — some of which link up with old-established Soviet era routes and enhances their capability. However, the focus appears to be on Far East Russian development as concerns Moscow directly, with the onus on putting into expanding Russia-China border crossings and developing Vladivostok Port capacity to service South Asia as well as the Eastern China seaboard. That includes Port and Logistics developments across the Northern Sea Route and the Russian Arctic, and we can expect to see more China-Russia coordination in developing the Arctic Belt & Road over the coming decade.