• Thailand has canceled the Kra Canal project for the time being. The project was proposed by China.

  • Thailand wants to focus on its rail project to improve connectivity between southern Thailand with the northern region.


  • According to the definition of the Oxford Dictionary, canal means. “ An artificial waterway constructed to allow the passage of boats & ships inland”. The most popular examples are- the Suez Canal, Panama Canal, etc. 

  • High costs are involved in making a canal, but its economic benefits are immense and are reaped by not only one or two countries but various countries for centuries.

  1. KRA CANAL-:

  • Kra canal, which is also known as the Thai Canal or Kra Isthmus Canal, is a proposal for a canal that would connect the Gulf of Thailand with the Andaman Sea across the Kra Isthmus in southern Thailand.

  • The idea of the canal has been proposed since the 16th century and in modern times since the 1930s, but no concrete step has ever taken due to high-cost environmental repurcussions & geostrategic obligations.

  • Then in 2015, an MoU was signed in Gangzhou, between China & Thailand on the construction of the canal.

  • The funding of the project estimated to be $28 billion, and it had to complete within 8 to 10 years.



  •  The trade routes in the South East Asian region which connect the ASEAN countries to the Indian Ocean & the African region, are the Malacca strait, Sunda strait & Lombok strait.

  • Among all these straits, the Malacca strait is economically and strategically very important as it is the world’s busiest maritime lane, through which 84,000 ships carrying around 30% of global trade transit each year.

  • Due to congestions in the existing straits, it is very much necessary for the countries to come up with an alternative solution which can reduce the congestion and can also be cost-effective.

  • Therefore, the Kra canal is beneficial for the countries as it can reduce operating & voyaging costs between East Asia & Europe, can lessen the burden upon the Malacca strait, and can also reduce the risk of pirates.


  • Kra Canal could help China by shortening transit for shipments to China from West Asia by 1200 Kms.

  • China desperately wanted the project to be started by the Thailand Govt. as it will decrease its dependency over the Malacca strait, because 80% of its oil imports from the Malacca strait, also it could easily enter the Indian Ocean and could cross it to reach African Countries to further expand its trade.

  • China also wanted to put the project under China’s Maritime Silk Road Initiative.

  • Geo-politically, amid the rising tensions between India & China, there’s a threat for both the countries regarding the blockade of the Malacca strait, which can largely hamper their economic activities. But Kra canal could solve this problem of China to a very large extent.

  • Also,  China could show its power to India, & could claim its unjustified right over the Indian Ocean by entering into the Indian Ocean & the Andaman Sea via the Kra canal.


  • Economically, the project would equally benefit India as any other country because it will lessen the dependency upon the Malacca strait.

  • But geopolitically, its a sigh of relief for India, as there was very much possibility that the Chinese navy could, within very less time reach the Andaman Sea & the Indian Ocean during the times of warfare or any other uncertain & unfortunate conditions. It was a strategic and security threat for India.

  • India had even started the preparations to counter China, by installing more military infrastructure in the Andaman Sea. Now for the times being, until the project remains canceled by Thailand, India does not need to worry much in this aspect.


  • The first reason, according to Thailand is economical, as the Kra canal could not reap as many benefits as the Suez & the Panama canal. It could not reduce the substantial amount of time & expenditure.

  • It could not generate as much revenue as its other alternative routes generate like the Malacca, Sunda & Lombok straits, which would not be justified to its construction cost, and without cost, Thailand could fall into the debt trap of China. 

  • Apart from this, Thailand also has international pressure by the U.S & India which can counter Chinese expansionism with the up-gradation of domestic forward bases in the Andaman & Nicobar Islands. Thailand also does not want to interfere in the rising tensions between India & China. It cannot afford to become a land of war.

  • Also, Thailand also has internal security issues in the southern region. Due to constant unstability in the region, the increasing divide between the Thai Buddhists & the Thailand’s Malay Muslims, it is not possible for now to build a huge infrastructure in the region.

  • Environmental concerns are also there.

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