The region serves as a critical node in the Belt and Road Initiative (BRI), yet Beijing's growing influence elicits mixed reactions from local elites and global players alike.
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Central Asia, positioned at the crossroads of geopolitical interests, is becoming a pivotal arena for China's global ambitions.
The region serves as a critical node in the Belt and Road Initiative (BRI), yet Beijing's growing influence elicits mixed reactions from local elites and global players alike.
Through ambitious infrastructure projects and educational programs, China not only secures its interests but also strengthens its influence in this part of the world.
This article examines how China exerts its influence in Central Asia, the strategies it employs, and the risks faced by the countries in the region.
Economic Presence: Figures and Projects
China has become the largest trading partner for Central Asian countries. In 2023, trade volume with the region surpassed $70 billion, while China's cumulative investments are estimated at tens of billions of dollars. Key projects include:
• Construction of transport corridors, including railways and highways;
• Modernization of energy infrastructure;
• Development of oil, gas, and rare earth metal deposits.
However, Beijing's economic dominance often raises concerns. Debt dependence tied to infrastructure projects has sparked fears of a "debt trap."
For instance, Kyrgyzstan and Tajikistan actively borrow from China, with Kyrgyzstan's debt to Beijing reaching critical levels—approximately 40% of its external debt.
Uzbekistan, with total debt amounting to $31.5 billion, owes Chinese financial institutions $3.8 billion, roughly 12% of its overall debt. Uzbekistan's debt to China accounts for about 4% of the republic’s GDP, which stood at $90.89 billion in 2023.
The Ministry of Economy and Finance of Uzbekistan expects the public debt-to-GDP ratio to reach 37% in 2025 and 37.9% in 2026, well below the IMF's recommended threshold of 60%.
According to Kazakhstan’s National Bank, as of January 1, 2024, the country’s external debt to China amounted to $9.2 billion, primarily sourced from the Export-Import Bank of China (Exim Bank).
Loans Under the BRI: A Key Instrument
One of China's primary tools in the region is loans for infrastructure projects provided under the Belt and Road Initiative (BRI). Since its launch in 2013, China has actively invested in transport corridors and infrastructure in Central Asia, linking China with Europe and the Middle East.
Example 1: China provided Kyrgyzstan with a $1.7 billion loan for the construction of highways and railways, which accounted for approximately 42% of Kyrgyzstan's external debt as of 2023. This debt compels Kyrgyzstan to find ways to repay it, risking deeper dependency on China.
Example 2: In 2019, China allocated $6 billion for a project to expand railway connections between China and Kazakhstan, enabling the transport of approximately 55 million tons of cargo annually and solidifying Kazakhstan’s position as a logistics hub on the Silk Road.
As Kubat Rakhimov, an economist and executive director of the Strategic Solutions Center "Applikata" and an expert at the Valdai Club, stated to The Caspian Post, many officials and media confuse loans with investments.
“If China builds roads and modernizes thermal power plants in Kyrgyzstan, these are loans secured by our tax revenues and state guarantees—essentially external debt. On the other hand, when private foreign companies enter the country without requiring state guarantees or investment agreements, they represent true investors.
In a healthy economic scenario, we should minimize projects tied to state-backed investment agreements,” the economist emphasized.
According to Sheradil Baktygulov, an independent expert and public administration specialist, there are two key aspects concerning Chinese loans and grants, as stated in his interview with The Caspian Post:
“Why do the authorities of Central Asian countries often prefer loans over grants from China? The answer lies in accountability. When granting funds, the Chinese require strict reporting and oversight, which is often not favorable to local authorities inclined to misuse parts of the aid. With loans, however, China provides funds under guarantees and allows recipients to allocate them freely. As a result, regional leaders find loans more convenient. If part of the funds disappears, it is not China’s fault but ours,” emphasizes Baktygulov.
Energy in Exchange for Loyalty: China’s Interest in Central Asia’s Resources
Central Asia plays a crucial role in China's energy security, especially as the country increases its consumption of gas and oil to support its growing economy. The region, particularly Kazakhstan and Turkmenistan, is rich in natural resources that attract China's attention.
Example 3: Since 2010, Turkmenistan has been exporting natural gas to China via a pipeline built with Chinese support. In 2022, the volume of supplies exceeded 40 billion cubic meters, accounting for almost 25% of China’s gas needs. Zhang Xin, Director of the Eurasia Institute at the Chinese Academy of Social Sciences, stressed that “stable and sustainable gas imports from Central Asia are of paramount importance to China.”
Example 4: In 2021, China also increased investments in Kazakhstan’s oil and gas projects, allocating approximately $5 billion for the development of new fields under agreements signed between CNPC and KazMunayGas.
According to Kazakhstan's Minister of Energy Bolat Akchulakov, these agreements help develop the country’s energy sector but require constant oversight to avoid excessive dependence.
China’s Cultural Soft Power: From Confucius Institutes to the Luban Workshop
Before discussing soft power, it is essential to understand that the term originates from American political science. It was developed in the late 1980s by Joseph Nye, Jr., an American scholar. Since then, academics from other countries have refined the concept.
Sheradil Baktygulov explained to The Caspian Post that “soft power,” as defined by Nye, involves using non-military and non-political methods to win over as much of society and elites in a given country or region as possible through argumentation and persuasion.
Nye does not equate soft power with its outcomes, but contemporary scholars often treat them as synonymous. The weakness of the American-European approach lies in its competitive or adversarial view of soft power.
This perspective builds an image of an institutional opponent, and once that image is established, it leads to securitization, where economic problems are overshadowed. Everything is viewed through the lens of suppressing a competitor or potential adversary.
“In this regard, China’s approach significantly differs from the Western one. In China, soft power is viewed as a means of fostering peaceful coexistence and development among neighboring countries. Based on this principle, various forms of cooperation are established. None of China’s cooperative programs include rhetoric, calls, or actions aimed against any other country. Conversely, U.S. and U.K. development aid programs explicitly allocate budgets for countering the influence of Russia or China,” Baktygulov explained.
According to Baktygulov, this distinction is fundamental: Western soft power aims to weaken a target country and make it dependent, whereas China’s approach strengthens cooperation and fosters mutual development. These are two fundamentally different approaches to the concept and application of soft power in foreign policy doctrines.
Beyond economic dominance, China is expanding its influence through cultural and educational initiatives.
Confucius Institutes operate actively in Central Asia, offering Chinese language courses and promoting Chinese culture. Thousands of students from the region receive scholarships to study at Chinese universities.
However, such strategies are met with mixed reactions. Many experts believe that China’s cultural influence faces resistance from local populations, who fear losing their identity and succumbing to external dominance.
China, however, does not aggressively impose its culture, given its multi-ethnic nature and preservation of each group’s identity. Instead, Beijing aims to facilitate understanding and build smoother relations for mutual development.
Confucius Institutes in Kazakhstan, Kyrgyzstan, and Uzbekistan promote Chinese language and culture. By the end of 2023, 16 Confucius Institutes in Central Asia were operating, enrolling more than 20,000 students.
Beijing-based analyst Ma Liao noted, “Confucius Institutes in Central Asia are not only centers of education but also platforms for promoting China’s positive image in the region.”
The Luban Workshop, launched in 2016, has become another crucial component of China’s soft power in Central Asia. In 2022, such workshops opened in Kazakhstan and Uzbekistan, providing training in technical and engineering specialties needed for BRI infrastructure projects. These initiatives help Chinese companies and skilled regional specialists establish sustainable connections.
Through these workshops, China is attempting a form of technological expansion in the region. What does this mean? By creating local engineers trained to work exclusively with Chinese equipment, China establishes a niche dominated by its technologies, gradually pushing out other foreign companies from the market.
It is worth noting, however, that Chinese technologies, like their American and European counterparts, adhere to international standards set by the WTO.
“This demand has been growing for some time, and China is now developing its industrial and technological clusters in the region. These clusters will work with local universities to train engineering personnel, aligning with China’s state policy, benefiting private Chinese companies, and supporting regional countries.
Previously, Chinese engineers would come and leave after completing a project in Kyrgyzstan. Now, China seems to have decided to establish its engineering schools locally. This can also help reduce conflicts between local workers and foreign employees,” concluded Kubat Rakhimov.
Security: Beijing’s Evolving Role
Incidents in Pakistan and Tajikistan involving attacks on Chinese nationals highlight the issue of securing Chinese investments in unstable regions and raise significant concerns.
These attacks, linked to instability in Afghanistan and the activities of extremist groups, pose serious challenges for the security and implementation of projects.
As expert Edward Lemon noted, such incidents not only threaten the safety of Chinese projects but also compel Beijing to strengthen its role in regional security.
This may manifest through military aid, training local forces, and even increasing the presence of private security companies.
In Pakistan, the situation is particularly complex: the inability of local authorities to adequately protect Chinese projects has led to growing frustration in Beijing.
Nevertheless, analyst Abdullah Khan argues that the billions of dollars already invested make the continuation of these projects inevitable, despite the rising risks.
For China, Central Asia is not only an economic corridor but also a strategic one, ensuring access to energy resources while preventing the spread of instability from Afghanistan.
To address these challenges, Beijing is enhancing cooperation with local security forces. In Tajikistan, China is financing the construction of military bases and providing training for local troops. Additionally, the influence of Chinese private security firms is growing, with these companies safeguarding key Belt and Road Initiative (BRI) projects.
Russia and China: Competitors or Allies?
While Russia and China formally cooperate in Central Asia, their interests often overlap. Moscow traditionally views the region as its sphere of influence, but its role in ensuring security has been weakened by the conflict in Ukraine. This creates space for Beijing, which is expanding its influence through investments and involvement in regional security.
However, China treads carefully, avoiding open competition with Russia. Within the framework of the Shanghai Cooperation Organization (SCO), both countries seek compromise to prevent conflicts of interest.
Notably, both countries are also members of BRICS, an organization that is gaining not only economic but also political weight each year.
According to Kubat Rakhimov, in 2024, Central Asia presents a unique situation where Russian, Chinese, and Turkish investments are competing in the region. This competition is beneficial, fostering healthy rivalry.
“Moving forward, it’s essential to analyze geopolitical actors, starting with their direct investments in areas like industrial facilities and logistics. Practically all Central Asian countries stand to gain from this,” Rakhimov noted.
China is now seriously considering encouraging private investments in the region. Beijing has realized that a direct increase in external debt is a challenging and complex strategy. Restructuring Chinese loans in exchange for green technologies is a possibility, though it is premature to discuss this at length.
“A real breakthrough would occur if China began writing off debts for countries in exchange for implementing green energy projects through private Chinese companies in these states.
This would significantly improve relations, as the opposition (often supported by the West) frequently leverages the argument of Central Asia’s debt dependence on China,” Rakhimov explained.
Two Key Criteria for China’s Next Level in Central Asia
Rakhimov identified two criteria that could allow China to transition to a new level and strengthen its influence in the region:
1. Direct Entry of Private Chinese Companies into the Central Asian market without government guarantees on either side.
2. Participation in Financial Markets, where these companies engage in securities trading on stock exchanges.
“This would make them a normal part of market mechanisms. China would then play by proper rules in this field. However, at present, it seems that China relies solely on state ‘brokers.’ The region is ready to shift towards ‘business-to-business’ projects rather than ‘government-to-government’ agreements,” Rakhimov concluded.
Russia’s Evolving Stance on Chinese Projects
Russia is also slightly altering its rhetoric and approach to certain projects involving China, such as the construction of the China-Kyrgyzstan-Uzbekistan (C-K-U) railway. Previously, Moscow opposed this route’s development, but today it no longer voices such categorical objections. This suggests that Russia may have a vested interest in the project, possibly in utilizing it not only for northern routes (to Europe) but also for southern ones—to Iran.
U.S. Response: Is an Alternative Possible?
The growing influence of China and Russia in Central Asia poses a challenge for the United States to offer alternative models of engagement. However, U.S. policy in the region remains limited due to insufficient economic presence and a lack of a clear strategy. A CNAS report highlights that Washington has yet to establish an effective foothold in Central Asia.
According to the report, past American diplomatic and economic initiatives in the region have not yielded significant results. Competing with China and Russia requires new approaches and greater financial involvement.
One key direction could be supporting the "Middle Corridor" project, which connects Central Asia to Europe while bypassing both Russia and China. This approach could reduce the region's dependence on the two dominant players.
While the West is making efforts in this direction, such initiatives require massive resources and effort—resources that are currently stretched thin due to the ongoing support for Ukraine and Israel. Israel, in particular, receives substantial backing primarily from the United States.
According to Sheradil Baktygulov, China’s approach is more appealing to Central Asian countries because it is not tied to economic aid or demands for political reforms. Unlike its Western counterparts, China does not impose political reform requirements on its partners as part of its programs.
“In this regard, China places greater emphasis on culture and education. However, unlike the West, Beijing advocates for mutual understanding and cultural exchange—it does not impose its way of life. China does not divide the world into right or left. In this respect, developing countries like ours in Central Asia can learn from both approaches and make their own choices,” concluded the Kyrgyz political analyst.
Conclusion
China's influence in Central Asia continues to grow, making the region a critical element of Beijing's global strategy. However, despite its economic strength, China faces challenges related to security, cultural resistance, and competition from other powers.
While China’s economy is robust, its vulnerability in unstable regions raises questions about the sustainability of its long-term projects. In this context, the decisive factor will not only be Beijing's economic power but also its ability to address challenges effectively and strengthen its influence in high-risk areas.
In the future, the balance of power in the region will depend on Beijing’s ability to resolve these issues and maintain stable relations with key players such as Russia, the United States, and the Central Asian nations.
Mehmet Fatih Oztarsu
