January 22, 2024


Is China’s Digital Silk Road (DSR) a threat to India?

One of the biggest compliments foreign investors and businesspeople give India is its digital transformation across several sectors. Things like Aadhaar, UPI, 5G, Digital India, etc., have had a noticeable impact on people’s everyday lives and have shown India to be a country and economy to watch. As countries took notice, India has been able to flex its geopolitical and economic muscles.

Another country doing its own flexing is China. In particular with its Digital Silk Road (DSR) initiative. Launched as a part of the ambitious Belt and Road Initiative (BRI), the DSR is arguably China’s primary channel for its foreign policy outreach in the digital sector. The goal is to improve regional and international connectivity while shaping China’s influence across geographies. Given its wide-reaching ambitions, is the DSR a threat to India?


When the BRI launched almost a decade ago, China’s goal was simple and quite evident – to capitalise on its decades-long high economic growth to build new trade corridors with China at the centre. While DSR can be seen as a sub-component, it has gained greater significance in recent times. China wants to shape its image as a benevolent aid provider in Asia and beyond. The BRI and DSR are the two driving forces.

The DSR’s primary objective is to enhance digital connectivity by supporting regional digital infrastructure and digital security projects involving AI, big data, and the Internet. The intention is to modernise the industrial sectors of the BRI participant states. China wants a market for its digital assets and doesn’t want the West to control the global digital value chain.

One of the components of the DSR is the Digital Belt and Road Program (DBAR), launched in 2016 with its “Big Earth Data Alliance for the Belt and Road”. Big Data would act as a peace envoy for all regions along the BRI. China signed over a dozen agreements with countries. Private and state-owned companies are also roped in wherever possible. At China’s 2020 World Internet Conference, over 130 companies, including Alibaba, Huawei, Epson, and Infosys, showed cutting-edge technological advancements.

The Southeast Asian region has become a focus area for DSR. The region is also of significance to India under its Act East Policy. China wasted no time in establishing its digital presence here. Under the China–ASEAN Information Harbor, approved in 2016, it has expanded operations with data centres, fibre optic cables, and telecom nodes across ASEAN countries. Until 2019, China had already installed fibre-optic cables in 76 countries and supplied telecom equipment to 21 countries.

The Chinese Communist Party (CCP) sees the digital sector as the next frontier in its quest for regional and global influence. In India, discussions on BRI and DSR have taken on greater significance in recent years. Indo-China relations over the past few years have been rocky, to say the least.

Chinese companies were previously welcomed into the Indian market. There was trouble down the road for some on that front. China’s digital expansion in the region also needs to be seen in the context of unfolding competition between it and the US. China hasn’t taken too kindly to some of India’s geopolitical moves, like joining the QUAD.

With India’s strides in the digital space and the growing prowess of its Digital Public Infrastructure, how much of a threat does China’s DSR pose? Does India have enough in its arsenal to counter?

VIEW: Falling behind

China’s regional connectivity and influence are more often than not seen through its physical infrastructure, like ports and railways. What’s less noticeable is its increasing digital capabilities advancing quickly. China is home to the largest growing number of AI-related academic papers and patents. 5G is one of its most reliable tools. Chinese companies are supplying equipment and infrastructure to other countries. India, while making strides, is far behind. India doesn’t have a coherent counter to the DSR for the subcontinent.

Chinese President Xi Jinping sees the global reshaping of twin geopolitical and economic orders as one of the great changes unseen in a century. Some of India’s decision-making could result in strategic isolation in the coming years. Its decision to work with the US-driven telecom revolution in 5G and 6G and develop standards for emerging technology like AI could mean being caught between the Global North and the South (think BRICS and ASEAN).

Meanwhile, China is developing 5G networks across Pakistan, Africa, and Myanmar. It has large industrial data centres, and it’s actively engaged in cyberspace, geospatial technologies, and digital currencies. India needs a more nuanced approach that builds manufacturing capacity with greater Indian participation. China has an edge in the Information and Communication Technology (ICT) sector. That’s given them a lot of leverage and influence in foreign countries. It undermines India’s diplomatic and strategic interests in the region.

COUNTERVIEW: More than capable to compete

India’s Digital Public Infrastructure (DPI) is now widely known and acknowledged worldwide. The DPI model is India’s not-so-secret weapon to counter China. It can also set rules and guidelines for responsible digitisation and cybersecurity. India’s DPI has a good balance between a capitalistic model with private-sector innovation and being answerable to the government. Some countries are sceptical about trading in intellectual property, while India is open to sharing it with developing countries.

If and when India reaches out to other countries, they get a better offer. China directly sells technologies to countries that can’t reverse engineer the products. They then become heavily dependent on China at every step in the innovation process. There’s also the whole surveillance issue connected to Chinese equipment. That’s bad news. Developing countries would benefit from multiple stakeholders that will encourage inclusive innovation. That’s what India offers.

Apart from its DPI, Make in India offers great opportunities. Relatively recently, India entered the race to build and maintain undersea data transfer cables. There are also concrete plans to make India a silicon chip manufacturing hub. India’s geographical proximity to the Indian Ocean gives it a strategic advantage. It has all the tools like DPI, UPI, the Open Network for Digital Commerce (ONDC), etc., to do its own thing and stave off competition from China.

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What is your opinion on this?
(Only subscribers can participate in polls)

a) China’s Digital Silk Road (DSR) is a threat to India.

b) China’s Digital Silk Road (DSR) isn’t a threat to India.


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