Narendra Modi Proposes India, Saudi Arabia Build ‘New Silk Route’ – Challenging China

Indian Prime Minister Narendra Modi visited Saudi Arabia on Tuesday, meeting with Crown Prince Mohammed bin Salman to discuss the “limitless potential” of their bilateral ties.

While Modi cut his planned two-day visit to Jeddah short due to a terrorist attack in Jammu and Kashmir, his time in the Saudi city included the signing of a variety of memoranda of understanding and a joint statement in which both countries vowed to increase their bilateral trade, focusing particularly on investment in oil and green energy including the development of a joint oil refinery. India is one of the world’s largest oil consumers and refiners, but does not have meaningful natural oil resources, making it heavily dependent on countries such as Saudi Arabia and Russia.

The two world leaders embraced upon Modi’s arrival at Jeddah’s Al-Salam Palace in images shared by the Saudi Foreign Ministry.

Key to their discussions in the meeting was the development of the India-Middle East-Europe Economic Corridor (IMEEC), a plan to dramatically boost infrastructure development and trade between Asia and western Europe intended to counter China’s Belt and Road Initiative (BRI). The BRI is a debt-trap program in which the Chinese Communist Party offers predatory loans to poor countries, meant to build massive infrastructure projects that the countries cannot afford. When the countries fail to pay their debts, China uses that leverage to erode their sovereignty or seize the projects. The intended goal of the BRI is to reconstruct the Ancient Silk Road that once connected traders in Asia with those in western Europe.

The IMEEC debuted as a joint program led in part by Saudi Arabia and India during the 2023 G-20 Summit, which India hosted, and has attracted support from the United States in addition to countries in the region.

In an interview with Saudi Arabia’s Arab News published on Tuesday, Modi described the IMEEC as a plan to create “the new Silk Route of the 21st century that will bring benefit to the generations to come” — a direct challenge to the stated goal of China’s BRI.

“This corridor will define the future of connectivity in all forms for centuries to come. It will become the key catalyst of commerce, connectivity, and growth in the entire region,” Modi predicted. “The corridor will enhance connectivity in all its forms, be it physical or digital. It will facilitate development of resilient and dependable supply chains, increase trade accessibility, and improve trade facilitation.”

“The corridor will increase efficiencies, reduce costs, enhance economic unity, generate jobs, and lower greenhouse gas emission, resulting in a transformative integration of Asia, Europe and the Middle East,” he continued. “We are working on clean and green hydrogen and related supply chains under this initiative. I visualize this initiative has a transformational potential for humanity.”

Saudi Arabia and India published a joint statement on Wednesday following Modi’s meeting with the crown prince that contained a provision on cooperation within the framework of the IMEEC.

“Both sides recalled the signing of the Memorandum of Understanding on the Principles of an India-Middle East-Europe Economic Corridor,” the statement read in part, “and expressed mutual commitment to work together to realize the vision of connectivity as envisaged in the Corridor.”

That vision will include, the joint statement claimed, “the development of infrastructure that includes railways and port linkages to increase the passage of goods and services, and boost trade among stakeholders, and enhance data connectivity and electrical grid interconnectivity.”

The two countries listed a variety of specific industries they hoped to increase their bilateral cooperation in, including “defense, security, energy, trade, investment, technology, agriculture, culture, health, education, and people-to-people ties.” Saudi Arabia specifically expressed an intent to invest in Indian “energy, petrochemicals, infrastructure, technology, fintech, digital infrastructure, telecommunications, pharmaceuticals, manufacturing, and health.”

Modi’s visit to Saudi Arabia followed the Indian leader hosting American Vice President JD Vance in New Delhi for talks that also centered heavily on economic cooperation. President Donald Trump announced a complete overhaul of American trade policy in early April through an initiative he called “Liberation Day” in which he imposed tariffs on nearly every country that trades with America. India was among them, receiving a 34-percent tariff hike that has since been paused to allow for negotiations. Vance led the first high-level foray of negotiations this week.

Both Modi and Vance described their approaches to each other’s countries, and the prospect of a new trade deal, in optimistic terms. In a speech on Tuesday, Vance announced that “America and India have officially finalized the terms of reference for the trade negotiation,” a first step towards negotiating the details of such an agreement.

“In the years to come, we’re going to see data centers, pharmaceuticals, undersea cables, and countless other critical goods being developed and being built because of the American and Indian economic partnership,” Vance predicted.

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