Beijing has reportedly offered sweeteners to Burma in the form of hospitals if it speeds up work on oil and gas pipelines destined for Yunnan province.

Through the state-owned China National Petroleum Corporation (CNPC), Burma could receive $US6 million to build new hospitals and improve its woeful healthcare facilities, the Times of India reported. The deal was mooted during the recent visit to Burma by top Chinese official Jia Qinglin.

Qinglin’s visit was the first by a senior ranking Chinese politician since Premier Wen Jiabao was there in June last year. Observers say it is a statement of Beijing’s outright support for the new Burmese government, as well as an attempt to further boost economic ties between the two countries that saw China inject nearly $US10 billion into the Burmese economy last year alone.

The trans-Burma Shwe pipeline project is one of the country’s largest foreign-funded ventures, and will pump some 15 million cubic metres of gas daily from blocks in the Bay of Bengal to China’s developing Yunnan province.

But China has in the past signalled a lack of confidence in the Burmese authorities’ ability to manage such a massive venture. In December last year it gave $US2.4 billion in loans to its southern neighbour, with speculation that it was aimed largely at speeding up construction of the pipelines. The recent offer of further aid may be an indication that the project is still not going smoothly.

Developments of this magnitude in Burma face a number of hurdles, not least the poor infrastructure and transport routes brought about by decades of economic mismanagement and government incompetence.

There is also the added issue of the volatility of certain parts of the pipeline’s route, most notably the final section in Shan state which runs close territory controlled by the opposition Shan State Army.

How the new government reacts to the offer of aid remains to be seen, given the historic lack of interest with which the country’s rulers have shown in the healthcare sector: Burma’s is ranked among the worst in the world, and the new budget announced last month does little to improve its prospects, allocating healthcare only 1.3 percent of total annual spending.

Critics of both China and Burma may also cry foul of hypocrisy, given allegations by rights groups that the Shwe project has led to the exploitation and abuse of civilians living nearby, as well as forced displacement on a large scale.

A recent report by EarthRights International documented several cases of human rights abuses along the pipeline route, and “numerous instances of land confiscation without adequate compensation”.

The pipeline also remains key to the government’s grip on power, with somewhere in the region of $US30 billion expected to be generated over the three decades after it comes online in 2013.