Chinese President Xi Jinping’s impending visit to Pakistan next week has generated a sense of nervous anticipation.

Xi’s visit was postponed last September in the wake of prolonged anti-government protests in Islamabad, and Pakistan’s government does not want anything untoward happening this time round.

As well as signing a raft of energy, trade and investment agreements, the Chinese president will inaugurate Balochistan’s Gwadar port, part of the 3,000 km long strategic China-Pakistan Economic Corridor (CPEC) which could radically alter the regional dynamics of trade, development and politics in the region.

Gwadar, once part of Oman before it was sold to Pakistan in 1958, is one of the least developed districts in Balochistan province. It sits strategically near the Persian Gulf and close to the Strait of Hormuz, through which 40% of world’s oil passes.

The construction and operation of this multi-billion dollar deep-sea port at Gwadar was contracted to a Chinese company in 2013. Some analysts argue the port could become China’s naval base in the Indian Ocean and enable Beijing to monitor Indian and US naval activities.

Chinese premier Li Keqiang proposed establishing the China-Pakistan Economic Corridor (CPEC) during his visit to Pakistan in May 2013. “Our two sides should focus on carrying out priority projects in connectivity, energy development and power generation,” Li said at the time.

Pakistan’s strong political relations with China may mean this initiative succeeds where other regional energy projects have become mired in security problems and political disagreements, says Vaqar Zakaria, energy sector expert and managing director of environmental consultancy firm Hagler Bailley Pakistan. “The Pak-Iran pipeline is on hold, the World Bank-backed Central Asia South Asia Electricity Transmission and Trade Project has to contend with security of passage through Afghanistan, and importing power from India has to wait for core issues between the two countries are resolved,” he said.

Energy-poor Pakistan certainly seems to have found a saviour in China, which has promised to stand by the country in its dark hour (parts of the country suffer power cuts for up to eighteen hours a day). So overwhelmed was the Pakistani president that he has predicted the economic corridor will be a “monument of the century” benefitting “billions of people” in the region.

Zakaria believes projects conceived under CPEC will ease Pakistan’s energy shortages and make a “substantial difference in the long term with both generation and transmission covered.” However coal figures prominently and Chinese money is “timely and useful” for cash-strapped Pakistan struggling to finance energy projects from western donors.

The CPEC project will include building new roads, a 1,800-km railway line and a network of oil pipelines to connect Kashgar in China’s western Xinjiang region to the port of Gwadar in southwest of Pakistan. The project also includes an airport at the port and a string of energy projects, special economic zones, dry ports and other infrastructure.

The estimated cost is expected to be US$75 billion of which US$45 billion will ensure the corridor is operational by 2020. The remaining investment will be spent on energy generation and infrastructure development.

China’s new silk roads

While the trade and energy corridor may be ‘monumental’ for Pakistan, for China it is part of more ambitious plans to beef up the country’s global economic muscle.

Chinese officials describe the corridor as the “flagship project” of a broader policy, “One Belt, One Road,” which seeks to physically connect China to its markets in Asia, Europe and beyond.

This initiative includes the New Silk Road  which will link China with Europe through Central Asia and the Maritime Silk Road to ensure a safe passage of China’s shipping through the Indian Ocean and South China Sea.

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“China is not building the corridor as an act of charity for Pakistan,” says Michael Kugelman, senior associate at the Washington DC based Woodrow Wilson Center. “It will happily fund and build any structure that plays into this goal–whether we’re talking about roads or ports.”

Some experts argue this initiative can bring greater cohesion in South Asia, one of the world’s least economically integrated regions. Adil Najam, dean of the Boston University Pardee School of Global Studies believes anything that binds the region together is “a good idea” since countries tend to focus on “zero-sum geostrategic posturing” rather than recognising the benefits of integration.

India, US worried

At the same time, the new silk roads are bound to intensify ongoing competition between India and China–and to a lesser extent between China and the US–to invest in and cultivate influence in the broader Central Asia region, says Kugelman. “India has long had its eyes on energy assets in Central Asia and Afghanistan, even as China has gobbled many of these up in recent years. The US has announced its own Silk Road initiative in the broader region,” he said.

India is concerned about China’s growing investment in Pakistan, particularly its recent decision to fund a new batch of nuclear reactors. Pakistan plans to add four new nuclear plants by 2023, funded by China, with four more reactors in the pipeline (adding up to a total power capacity of 7,930 MW by 2030).

Many argue that China is supplying nuclear technology to Pakistan in defiance of the Nuclear Suppliers Group (NSG) guidelines, which forbid nuclear transfer to Pakistan as it has not signed the Nuclear Nonproliferation Treaty. China argues that these projects were agreed with Pakistan before it became a member of NSG in 2004.

Conflict in Balochistan

However, the economic corridor is unlikely to be successful unless there is peace in Gwadar. The district is embroiled in conflicts with militant organisations, like the Balochistan Liberation Front, who are highly suspicious of foreign-funded investments. These groups have not only vehemently opposed the development projects but have even attacked Chinese engineers working on the port.

It is the reason given by experts for the change of route to pass mostly through Punjab, thereby avoiding some of the country’s most strife-torn areas in both Khyber-Pakhtunkhwa and Balochistan provinces much to the chagrin of local legislators.

At the same time China has concerns about the growing influence of radical religious groups in Pakistan in its own Xinjiang province, which has a significant majority of Muslim Uighurs.

For now the Pakistan military plans to train over 12,000 security personnel and form a “special division” to provide security to Chinese working on the economic corridor. Some 8,000 security personnel have already been set out to protect over 8,100 Chinese working on 210 projects across Pakistan.

8 comments

  1. An excellent, balanced synthesis of the situation of the economic corridor with refreshingly clear maps. However, political historians of China do argue that ‘China dosent do military/ naval bases’ in its history. Rather Gwadar is part of the ‘ the string of pearls’ strategy of watch towers for monitoring trade flows. Thanks Zofeen! Mehjabeen

  2. Malik Amin Aslam Khan |

    A very good article outlining a strategic partnership which bodes well for Pakistan. Investments in infrastructure, solar and nuclear electricity all seem good – the only caveat being the transfer and dumping of outdated nuclear and/or coal technologies into Pakistan which Pakistan needs to guard against. Remember China has announced to retire majority of their coal plants by 2020 !!

  3. This is highly informative article with excellent illustrations in the wake of ongoing economic and geo-political developments in the backdrop of China Pakistan Economic Corridor (CPEC). We strongly believe that the huge investments being made by our long-time and time-tested friend China in the region would change the development scenario in the greater interest of billions of people across south Asia, central Asia, China, middle east and Europe. This project not only ensure economic development of Pakistan but also its security issues with the neighboring states.

  4. It is too good to be true. A country beset by and mired in all sort of extremism needs such “Big Push” investment of tens of billions to escape the quagmire it is in. There are some worrying political slips that might militate against the smooth completion of CPEC. The first is the proposed route of the corridor. The decision to potentially change the corridor route has already ruffled political feathers in KPK and Balochistan. The sense of deprivation that afflicts small and backward provinces will exacerbate further. The political reconciliation in Baluchistan plagued by decade long insurgency is another factor which should be a top priority. The CPEC has the potential to turn the tide but it may also create political alienation.

  5. The route would pass through many core habitats of wildlife such as the snow leopard adn the markhors both China and Pakistan stand committed to protect. The new road link would also provide easy road access for wildlife trafficking. It is expected that adequate measures are taken to safeguard these rare animals

  6. Pingback: Pakistan’s Gwadar port reels under water shortages | The Third Pole

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