Myanmar pulled a fast one recently. The New Age reported today
... the Myanmar government has expressed its inability to provide funds to construct the Myanmar portion of the 153-kilometre road link.
The Myanmar government recently, in a letter to Bangladesh government, said that it would not provide any funds from its own resources or seek foreign funds to construct the road connecting the two countries, saying that the project is not in its priority list.
Even Bangladesh’s proposal to persuade donor countries to finance the project has been turned down by the Myanmar government, said a communications ministry official, citing the letter of the Myanmar government.
‘If Bangladesh finds any donor for Myanmar to finance the road link project, we will use the funds for some other priority projects,’ said an official quoting the letter, received early this month.
The letter asked the Bangladesh government to construct the entire road at its own cost or approach donor countries for funds to construct the road on its own initiative.
Can you believe the cheek? Yangoon tells us that not only do they not have the funds for the road, but if we find the funds for them, they're just gonna use it on someting with a higher "priority". Huh?!
Just to put things in perspective, this is what the deal was supposed to be
According to officials the road, which will stretch from Taungbro to Kyauktaw in Myanmar via Ramu-Gundom to Cox’s Bazar in Bangladesh, was planned to be constructed in two phases at the cost of Tk 933.46 crore. The Bangladesh government, according to the plan, would construct the 43-kilometre road in the first phase, out of which 20 kilometres would be in Bangladesh and 23 kilometres in Myanmar, at a cost of Tk 163.49 crore. The total cost for this would have been borne by Bangladesh. Out of the total sum, Tk 94 crore would have been spent for building the 23-km road from Taungbro to Bawli Bazar inside Myanmar along with two bridges and 90 culverts. Japan had also agreed to provide equipment to Bangladesh for construction of the 43-km road in the first phase, according to officials of the communications ministry. Later, in the second phase, another 110-km stretch of road from Bawli Bazar to Kyautaw in Myanmar would have been constructed at an estimated cost of Tk 770.26 crore.
We were going out of our way to be nice and make the road for them because this 153-km "Myanmar-Bangladesh Friendship Road" was supposed to be an alternate route for the Asian Highway that would allow us to connect with China and the South East Asian countries without having to go through India, which would have been a good thing because it's been quite a big pain in the butt recently.
And things were going well too - in June, we learnt that the government was planning to start constructing the road in the next fiscal year. There were no objections from the Myanmar side, (and why would there be - we were making their roads for free..), and no signs that things would turn sour.
So you can imagine how ridiculous all this suddenly sounds - a done deal suddenly falls so far off their priority list that we are asked to unilaterally fund a bilateral project.
Why, then, is Myanmar throwing a tantrum like a little kid, going "I won't, I won't, I won't!"?
This is where India comes in.
It so happens that at around the same time, high-level talks were also taking place surrounding the Myanmar-Bangladesh-India gas pipeline that started back in 1997. While Bangladesh stood to earn $125 million as transit fee form the gas pipeline, the clear beneficiaries were India and Myanmar - Myanmar would sell its vast yet unutilised natural gas reserves to generate much-needed revenue, and the gas would go towards meeting India's rapidly growing energy needs. That India already has part-ownership in some of the off-shore reserves, and Myanmar also desperately needs the revenue to prop up its stagnant and close-to-bankrupt economy make the deal particularly sweet for the two.
Seeing this as an opportunity to hash out some bilateral issues with India, Bangladesh decided to tag on three conditions to the tri-nation pipeline project - measures to reduce the trade-imbalance with India, providing corridor for Nepalese and Bhutanese goods to Bangladeshi ports, and access to hydroelectric power from Bhutan and Nepal. Initially, India seemed to be willing to consider these conditions, but later on hardened its stance and ruled out typing bilateral issues to a trilateral deal. Bangladesh, for its part, stuck to its conditions.
When energy ministers from India and Myanmar met in New Delhi on July 6th to explore an alternative route to the pipeline, Bangladesh was given a last minute invitation to make it virtually impossible to attend. The alternative route, by the way, was simply one that would bypass Bangladesh by adding an extra 500 km at a cost of Rs. 250 million to the 900 km pipeline that itself would cost Rs. 450 million.
Bangladesh felt India was trying to play hardball, and wished it 'good luck' - it felt there was no way the pipeline would be viable, not only because of the extra cost of the circuitous route that would have to pass through very difficult terrain, but also because India's NE is infested with separatists who would like nothing more than a pipeline to blow up every once in a while, making it a security nightmare for India.
Sure enough, nothing positive was heard about the possibility of pursuing the alternate route. Bangladesh, meanwhile, hinted that it would be willing to negotiate on some of its conditions. There's obviously some margin for negotiations, since we haven't had talks of any sort with Nepal concerning hydroelectricity and Bhutan has no excess supply after meeting India's demands, so one would think that as long as we manage to get the trade issues sorted out, things should work out to everyone's advantage.
It was reassuring to see that Delhi was responding in kind - India requested Bangladesh to reconsider and to that end, the Indian Additional Secretary of the Petroleum Ministry is expected to sit in two-day talks with the Bangladeshi Energy Advisor of the Ministry of Power, Energy and Mineral Resources on August 5th and 6th.
This is the backdrop against which Myanmar is backtracking on the road project. No doubt, it is to create pressure on Bangladesh. Why do I blame India for this diplomatic imbecility on Myanmar's part? India knows that if the road does not happen, Bangladesh will have to use the portion of the Highway through India, something it is loathe to do. Myanmar doesn't have an inherent interest in the pipeline passing through India - it will earn the same revenue and will see little change in its production end, since the Indians will take care of most of the development and distribution investment. On the other hand, the costs for India will change dramatically if Bangladesh does not come on board. So while Myanmar doesn't have an inherent interest, it is forced to consider the demands of its significant customer, and thus has probably been asked to play some hardball itself.
What the outcome of this situation will be is hard to tell. Myanmar will probably be made to rescind its decision by India if it manages to negotiate successfully with Bangladesh. It does put us in an uncomfortable position though - we not only stand to lose the transit fee revenue if this doesn't work out, but it also chokes one of our accesses to the South East. The prestige issue given the significance of this road project in our Look East Policy can't be ignored either.
A little bit of outside help would also be nice at this point. China has emphasised the importance of the Chittagong-Kunming connection via Myanmar a few times and it could be asked to tell Myanmar to stop bullshitting around - China being a major patron of theirs and all.
Irrespective of the outcome though, Myanmar will have lost our trust by its reckless behaviour. I doubt it cares though - Myanmar's military junta is nonchalant about many important matters that relate to the average citizen, and I wouldn't expect concerns of bad business etiquette to be high on its agenda. This "Friendship" Road might still happen, but the trust that is important in any important friendship will have already been lost.