China Pakistan Economic corridor (CPEC) | IAS Target IAS Target

China Pakistan Economic corridor (CPEC)

China–Pakistan Economic Corridor (CPEC) is a collection of infrastructure projects that are currently under construction throughout Pakistan. Originally valued at $46 billion, the value of CPEC projects is worth $62 billion as of 2017. CPEC aims to rapidly modernize Pakistani infrastructure and strengthen its economy by the construction of modern transportation networks, numerous energy projects, and special economic zones. On 13 November 2016, CPEC became partly operational when Chinese cargo was transported overland to Gwadar Port for onward maritime shipment to Africa and West Asia, while some major power projects were commissioned in late 2017.

A vast network of highways and railways is to be built under the guidance of CPEC that will span the length and breadth of Pakistan. Modern transportation networks built under CPEC will link seaports in Gwadar and Karachi with northern Pakistan, as well as points further north in western China and Central Asia. Pakistan's railway network will also be extended to eventually connect with China's Southern Xinjiang Railway in Kashgar. It is among the six economic corridors conceived under China’s Silk Road Economic Belt and 21st-Century Maritime Silk Road i.e, OBOR Initiative.

Over $33 billion worth of energy infrastructure IS to be constructed by private consortia to help alleviate Pakistan's chronic energy shortages. A network of pipelines to transport liquefied natural gas and oil will also be laid as part of the project, to transport gas from Iran. CPEC's potential impact on Pakistan has been compared to that of the Marshall Plan undertaken by the United States in post-war Europe. Pakistani officials predict that CPEC will result in the creation of upwards of 2.3 million jobs between 2015 to 2030 and add 2 to 2.5 percentage points to the country's annual economic growth. CPEC is seen as the main plank of Chinese President Xi Jinping's Belt and Road Initiative.

What China gets from CPEC

  • China also has huge strategic and geopolitical advantages in the Indian Ocean region. From Gwador port China will access the Indian Ocean region. There is speculation that China may convert Gwador port into a military base in the future, so threat to India's interest in the region.
  • China will connect from its western part to Africa and Europe and this will extend to the Middle-east and central Asia. This will shorten the route and at the same time safe route because China is concerned about the Malacca strait (important chokepoint) in times of crisis. China can save millions of dollars every year by shortening its route and save important forex.
  • China can shift its manufacturing base from China to Pakistan because cheap labour and natural resource in Pakistan provide China opportunity to invest in Pakistan and this helps china to sell its cheap products under OBOR and India will get competition from Pakistan.
  • China strategic interest in Gwador port, because Gwador is an important point on China's string of pearls theory to encircle India.

Pakistan concern

  • Debt trap experiences of other countries in the region as Srilanka's Hambantota port, which was acquired by China when Srilanka failed to repay its debt.
  • India phobia, Pakistan believes India will create obstacles in CPEC completion and Indian support militancy in Baluchistan to sabotaging CPEC
  • Pakistan supported terrorism, but now under pressure from the global community Pakistan need to curb terrorist activities and banned these organisation. So these groups also create a problem for Pakistan and the threat to CPEC
  • The Pakistani Army had set up a special division to provide security for Chinese workers in Pakistan involved in CPEC-related projects. Despite this, China deploys its security personnel in Pakistan for the security of Chinese workers. So Pakistan also apprehensive of Chinese military personnel present in its territory.
  • Pakistan suppresses the people's voice, whether in PoK or Baluchistan region. So people unrest may create instability in Pakistan and raise questions on the success of CPEC

India and CPEC

  • India shares a great deal of trust deficit with China and Pakistan and has a history of conflict with both and India has a war history with both countries. China may also claim SAARC membership, so this may undermine India's interest in the Indian Ocean region.
  • CPEC passes through PoK which India claims its integral part. So India's participation in CPEC affects the Indian position and legitimise Pakistan's claim on disputed territory.
  • CPEC successfully helps in strengthening Pakistan's economy, so Pakistan has the resources to fund terrorist activities and anti-India elements. At the same time, China's presence in Pakistan also boosts Pakistan to take challenging steps.
  • CPEC rests on a Chinese plan to secure and shorten its supply lines through Gwadar with an enhanced presence in the Indian Ocean. Hence, it is widely believed that upon CPEC’s fruition, an extensive Chinese presence will weaken India’s influence in the Indian Ocean

India option to counter Chinese's design CPEC

  • Chinese dominance in Gwadar Port, so counter china design India has invested in Iran’s Chabahar port which is very near to Gwadar. Through Iran, India can access Afghanistan and other central Asian countries. India-Iran-Afghanistan signed a trade corridor deal giving India land access to Central Asia.
  • While Chahbahar port is good and helps to bypass Pakistan, but India needs to improve its relationship with Pakistan. Because peaceful and prosperous Pakistan is in India's interest. So try to open back channel diplomacy and start stalled negotiations.