The Bay of Bengal often neglected in the Indo-Pacific discourse is quickly developing into the frontline of a subtle yet heated strategic rivalry. At its centre is the Rakhine Corridor, stretching through western Myanmar’s Rakhine State. The Rakhine Corridor can be defined as a geopolitical corridor that was once associated with humanitarian crises and the Rohingya outflows, that will now become a geopolitical corridor in which the interests of India, China, the United States and ASEAN meet and sometimes clash.
A Strategic Geography Too Valuable to Overlook
The Rakhine State is bordered by Bangladesh and opens into the Indian Ocean. Its 500-km of coastline has not only an abundance of natural gas, but it also provided landlocked southern China a unique opportunity to access the sea without the congested and militarily vulnerable Malacca Strait.
As a result, Kyaukphyu, a formerly sleepy port town in Rakhine, is now very much at the center of the ambitions of China. Under the Belt and Road Initiative, Beijing will spend $7.3 billion in the Kyaukphyu Special Economic Zone where it will build deep-sea port infrastructure. The twin oil and gas pipelines already in operation, completed respectively in 2013 and 2017, connect Kyaukphyu with China’s Yunnan province with the ability to transport 22 million tonnes of oil and 12 billion cubic meters of natural gas annually. China was able to reduce its vulnerability to the chokepoints of the South China Sea and the Malacca Strait where 80% of its oil imports pass.
India’s Balancing Act: Security and Connectivity
India has its own compelling interests in Rakhine. India is seeking to connect the eastern Indian port city of Kolkata to Myanmar’s Sittwe Port by sea, and then by river and road towards Mizoram in Northeast India through the Kaladan Multi-Modal Transit Transport Project (KMMTTP) – a project begun in 2008 at about US$484 million. After years of inactivity, the Sittwe Port finally went operational in May 2023.
For India, this corridor is a commercial opportunity and strategic necessity; it provides an alternate route to a landlocked Northeast and reduces New Delhi’s dependence on the thin Siliguri Corridor (the ‘Chicken’s Neck’), while blunting China’s growing footprint in Myanmar. Unfortunately, the timeline has already been delayed by security threats from local insurgents and political vulnerability in Myanmar.
India also faces a diplomatic balance. New Delhi has engaged the junta government in Myanmar while expressing concern over the treatment of the Rohingya populations and instability in Rakhine. Rohingya abuse is not only a concern for India, but one which has impact on global audiences and Bangladesh – which is home to 1 million Rohingya refugees.
China’s Infrastructure, India’s Local Touch
China and India’s divergent trajectories in Myanmar’s Rakhine State, both in process and evidence, reveal the two nation’s distinct geopolitical orientations. China deals in development projects that are larger in scale and speed, primarily focused on critical infrastructure projects – the $7.3 billion Kyaukphyu Deep-Sea Port (though Phase 1 was scaled to $1.3 billion), a 770 km oil/pipeline that can carry 22 million tons of oil and 12 billion cubic meters of gas annually to Yunnan, and the Kyaukphyu Special Economic Zone (SEZ), which forms part of the China-Myanmar Economic Corridor (CMEC). The 70% ownership of the port by China via CITIC Group, who would eventually execute the majority proposals for the development, comes with fears that backed China’s potential for “debt trap diplomacy”, may not benefit local communities, and important dual-use aspects from any military applications. In contrast, India is slower but focussed on people and people-centered projects such as the $484 million Kaladan Multi-Modal Project – linking Kolkata with Mizoram via Sittwe Port – and rebuilding homes (2018) for 250 displaced persons in Rakhine. Furthermore, India donated COVID-19 vaccinations to Myanmar, humanitarian aid and related events, building capacity, and responsible goodwill in the region.
U.S. Strategic Influence in the Rakhine Corridor
The United States may not be directly active in Myanmar’s Rakhine Corridor, but it is viewed as a strategically important area under the US Indo – Pacific Strategy (2022) to deter China’s influence. The U.S. and its allies are concerned about the Coco Islands, located only 55 km from India’s Andaman and Nicobar Islands, which may have surveillance equipment built by China, including radar systems and an allegedly upgraded airstrip, raising fears of a possible military dual-use ability. Secondly, following the coup in Myanmar in 2021, the U.S imposed sanctions that might reduce any direct activity, but the U.S nevertheless continues to engage in multi-nation diplomatic alternatives to mitigate this strategic issue in both a unified and fragmented way, including at the regional-level with India and Japan through the Quad arrangement. The U.S supports the Kaladan Development project in India and the U.S – Quad Infrastructure Coordination Group on multi-national ways to prioritize development and carrot-fund transparency concerning infrastructure compared to China’s Belt and Road Initiative (‘BRI’). In 2023, the U.S. also pledged $50 million to boost maritime domain awareness in the Indo-Pacific. While the U.S. continues to play a behind-the-scenes role, they are actively influencing the Rakhine Corridor settlement area through strategic partnerships, intelligence sharing and infrastructure diplomacy in comparison to China’s Belt and Road Initiative.
ASEAN’s Dilemma and Bangladesh’s Stakes
ASEAN is caught in a predicament with the Rakhine Corridor: wanting to deal with Myanmar’s junta since the 2021 coup without legitimizing it but also maintaining stability. Thailand and Indonesia have pursued quiet diplomacy, with Indonesia at the forefront of ASEAN’s limited mediation and emphasizing a five-point consensus. The potential for even greater outflows of Rohingya migrants, particularly with over 200,000 fleeing Bangladesh since 2017, increases the difficulty in balancing these priorities.
Bangladesh, now host to over 1 million Rohingya, has sought to emphasize that the development of Rakhine should be construed in terms of facilitating the safe and voluntary return of refugees. Conversely, as China and India invest in infrastructure projects, such as Kyaukphyu Port and the Kaladan Project, and fail to involve local stakeholders, Dhaka worries that the economic corridor may exacerbate ethnic divisions in Rakhine and negatively affect the safe return of refugees.
The reality of Local:
For most people in Rakhine, the promises of development are yet to be realized. Conditions for the local population remain dire, unemployment remains high, infrastructure is inconsistent, and divisions are entrenched within the local ethnic community. Numerous locals express a feeling of being in spectatorship to foreign capital and companies, who are telling them their future. Ethnic Rakhine groups, Rohingya, and other minority communities have little say in how these corridors take shape. Without inclusive frameworks, experts warn that mega-projects like these could create more grievances. The Arakan Army an armed ethnic group has already warned against these foreign enterprises and is engaged in conflict with Myanmar’s military in northern Rakhine.
The Rakhine Corridor is representative of the modern Great Game not conquest, but connectivity and influence. China desires a key energy and trade route to its southwest, India is prioritizing regional integration and security, the U.S. intends to counter China’s dominance, and ASEAN desires to keep the peace without taking sides. The greatest challenge is to ensure Rakhine is an active partner and not a strategic pawn because the future of the corridor will shape the geopolitical future of the Bay of Bengal.
