MANTRAYA ANALYSIS#72: 02 OCTOBER 2023
A Rail Line from China to Myanmar
BIBHU PRASAD ROUTRAY
Abstract
Myanmar’s military-formed government and China are seeking to kickstart the much-delayed Muse-Mandalay railway project. Responsibility for dealing with opposition to the project and other hindrances within Myanmar appears to have been assigned. Nonetheless, swift execution of the project is unlikely without calming the civilian resistance to the military.
The Meeting
On 25-26 September 2023, China hosted the Global Sustainable Transport Forum in Beijing. Chinese Vice Premier He Lifeng attended the opening ceremony and read a congratulatory letter from Chinese President Xi Jinping. The forum, reported by Chinese media, was an opportunity for China to stress that it is committed to ‘promoting global transport cooperation and providing the world with new opportunities through its own development.’ In attendance, among others, was Mya Tun Oo, deputy prime minister and transport minister of the State Administration Council (SAC), formed by the Myanmar military. On the sidelines of the meeting, he reportedly discussed the Muse-Mandalay rail project with the Chinese.
The Project
The proposed Muse-Mandalay railway project (MMRP), unveiled in 2011, is a major part of the China-Myanmar Economic Corridor (CMEC) and the broader Belt and Road Initiative (BRI) of China that includes the construction of a Pan-Asian Railway Network running through Myanmar, Vietnam, Thailand, and Cambodia. Proposed to be built by Myanmar’s state-run Myanma Railways and the China Railway Eryuan Engineering Group (CREEG), the MMRP would link Kunming, the capital of China’s southern Yunnan province, and Mandalay in central Myanmar through the Muse border in Shan State. It is projected as a 431-kilometre-long standard-gauge railway project with an estimated cost of US$9 billion.
Under the CMEC framework, the proposal is also to further extend the line from Mandalay to the Kyaukphyu Special Economic Zone (KP SEZ) and the New Yangon City, the two other key sites of China-Myanmar infrastructure projects. China is developing a deep-sea port at Kyaukphyu, a city on the Bay of Bengal in Rakhine State. An 800-kilometre China-Myanmar Oil and Gas Pipeline, which began operations in 2009, has been running from Kyaukphyu through Mandalay and Magway regions, and northern Shan state. Once completed, the rail line will allow Chinese trade to bypass the congested Strait of Malacca between Malaysia and Indonesia and boost development in landlocked Yunnan. More crucially, Beijing wants to avert the worst-case scenario of a foreign power disrupting its oil shipments from the Middle East by blockading the straits.
Mya Tun Oo’s visit to China included a trip to the headquarters of China Railway Group Co Ltd, where he reportedly discussed a feasibility study for Muse-Mandalay and Mandalay-Kyaukphyu rail sections. The Myanmar military’s official media said that he also met Vice Premier He Lifeng and Chinese Transport Minister Li Xiaopeng to discuss transport cooperation, the acceleration of existing projects, and the possibility of new projects.
Delays, Opposition, and the Restart
There are widespread apprehensions as to the MMRP’s impact on the environment and Myanmar’s sovereignty. The Myanmar military has remained unconcerned with either of these dangers. The MoU between the two countries was signed in 2011 when the Military headed a quasi-civilian government. However, work on the project halted in 2014 after strong protests and activism in the Rakhine state. In 2018, the project was revised during the National League of Democracy (NLD) government’s term. The preparation of the bilateral MoU for the MMRP project was executed in 2019.
The railway projects were among the 33 agreements signed by President Xi Jinping during his visit to Myanmar in January 2020. To date, however, the project has remained largely in the planning stage, delayed further by the onset of COVID-19 and then the coup of February 2021. The Myanmar military’s urgency to move ahead with the project emanates from its bid to please China, which provides it with diplomatic protection in international forums. For the SAC to continue, in a widespread civil war situation, support from China remains a critical factor.
The Symphony
Chinese bid to access the Bay of Bengal, through the CMEC, has synchrony with the Myanmar military’s avowed aim of establishing the country as an economic corridor and attracting Chinese investment. This has assumed more significance due to the country’s growing isolation, which appears to have hurt the regime. The frequency and intensity of engagement between the two countries, in fact, has picked up, as have expressions of commitment to their economic relations.
Lately, indications to this effect have been provided by military chief Min Aung Hlaing. In September of this year, at the Myanmar Economic Committee, he hailed the potential trade benefits of a Kyaukphyu-Mandalay railway. He said the regime also assessed the feasibility of a Muse-Mandalay railway and even suggested building another line between Chinshwehaw and Lashio near the Chinese border.
Not surprisingly, nine SAC ministers visited China in September, reflecting the regime’s deepening ties with Beijing. On 26 September, Mya Tun Oo attended the Comprehensive Transport Investment Promotion Conference in Beijing and said that his government was committed to establishing Myanmar as an economic corridor by firmly partnering in the BRI project as well as the Mekong-Lancang Cooperation projects. The latter is a sub-regional cooperation mechanism jointly established by China, Thailand, Cambodia, Laos, Myanmar, and Vietnam in 2017. In March 2023, media reports indicated that work might have started on the MMRP project. The military spokesperson observed that “field inspection and reports have been completed. The implementation to resume the projects is still being discussed [sic].”
Consultations may have indeed begun between the two sides to kickstart the long-delayed project. The military is expected to take care of the domestic concerns, whereas Beijing appeared to have taken responsibility for dealing with the ethnic armed organisations that operate in northern Myanmar in Shan and Rakhine states. In late February 2023, China’s special envoy for Myanmar affairs, Deng Xijun, held meetings with the Kachin Independence Army (KIA), the United Wa State Army (UWSA), and the Myanmar National Democratic Alliance Army (MNDAA) to discuss trade and economic cooperation with a focus on the MMRP. Deng reportedly pushed the insurgents to reach some form of a cease-fire with the military government. In July, three groups — the MNDAA, the Ta’ang National Liberation Army (TNLA), and the Rakhine Arakan Army (AA) – released a joint statement (in Burmese and Chinese) vowing to protect international investment in their regions, which are home to several key Chinese-led projects, and also to “crush perpetrators of violence” in Shan and Rakhine states.
The Tail Piece
Both Myanmar and China continue to grow dependent on each other. Myanmar’s military critically depends on Beijing for its survival. For China, Myanmar remains a key constituent of its BRI project. The project is not intended to benefit the hosts but the Chinese economy and its strategic expansion. The final chapter in the MMRP project, however, is yet to be written. While Myanmar and Chinese state-run media would like to highlight the swift progress achieved, the current civil war situation poses a substantial challenge to actual implementation. The opposition’s Peoples Defence Forces (PDFs) and the EAOs that operate in Kayah and Sagaing regions remain bitterly opposed to all military initiatives, including the MMRP. Defeating this opponent will be necessary for the military to execute the project. That feat has not been achieved in the last two-and-a-half years since it grabbed power. The coming months are likely to witness the continuation of the military’s efforts to bring stability to the areas through which the project passes. This translates into more violent action against the opposition with severe collateral damages.
(Dr. Bibhu Prasad Routray is the Director of Mantraya. This analysis has been published as part of Mantraya’s ongoing “Fragility, Conflict, and Peace Building” and “Regional Economic Cooperation and Connectivity in South Asia” projects. All Mantraya publications are peer-reviewed.)
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