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Myanmar in talks with Russia for deep-sea port and oil refinery

The Myanmar ruling junta’s choice of Russia for the construction of the Dawei deep seaport on the country’s east coast has sparked tensions with China, which had also expressed interest in developing the port near the Thailand border.
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Source: MyIndMakers

According to sources, the junta is eager for Russian investment in the port project, along with the establishment of a special economic zone that includes an oil refinery. China had previously conducted a feasibility study for the Dawei port but shifted focus to the Kyakphyu deep seaport, situated near the Sittwe port built by India. However, the junta’s inclination towards Russia has drawn criticism from China, experts on Myanmar revealed.

The proposed Dawei port, located in the Tanintharyi region on the east coast of Myanmar (Andaman Sea), serves as a vital gateway to the Greater Mekong Sub-region (GMS) countries, including Cambodia, Laos, Thailand, Vietnam, and China. It also holds potential as a major entry point for Thailand’s containerised trade, given its proximity to Bangkok, connected by a well-developed road network.

Myanmar and Russia are reportedly in discussions regarding the proposed port project, as the junta seeks to strengthen ties with Moscow to counterbalance Chinese influence in the country’s resource-rich territory. Plans under consideration include the construction of the Dawei port with a capacity of 10 million tonnes and an oil refinery capable of processing 100,000 barrels per day.

However, China is concerned that Russia’s involvement in Myanmar’s port sector could undermine its own projects in Kyaukphyu, within the broader context of regional trade dynamics.

India might prefer Myanmar aligning with Russia over China, given China’s exploitation of Myanmar’s resources and strategic position in the Bay of Bengal. India has historically been a key security provider in the region.

Notably, submarines supplied to Myanmar by India are of Russian origin. Additionally, Indian and Russian companies have collaborated to manage an airport near the Chinese-controlled Hambantota port in Sri Lanka.

Myanmar’s junta is reducing reliance on China and strengthening ties with Russia for military supplies and infrastructure projects. The Myanmar Investment & Foreign Economic Relations Minister visited Moscow to discuss port development, special economic zones, petroleum refineries, and energy projects.

Myanmar increased oil imports from Russia last year to support its air force against rebel groups. Defence cooperation between Myanmar and Russia has intensified, with naval base visits and maritime security exercises.

During the chief of Sittwe naval base’s visit to Russia, a $35 million agreement was signed. Russia is now Myanmar’s top military hardware supplier, providing Sukhoi fighter jets and rocket launchers, totaling $406 million. Myanmar’s junta chief Min Aung Hlaing has visited Russia three times since seizing power in February 2021. Additionally, Myanmar became a dialogue partner of the Shanghai Cooperation Organisation (SCO) in 2022.

As per the reports, Russia is providing sniper and drone training to Myanmar through private military companies Wagner and Vega Strategic Services, with specialists on the ground in areas with ethnic groups.

Additionally, Russian nuclear company ROSATOM might supply Small Modular Reactors to Myanmar. In February 2023, Yangon saw the opening of its first Nuclear Technology Information Centre, supported by Moscow.

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