Chinese Pakistan Economic Corridor

The China-Pakistan Economic Corridor, or CPEC, is a group to upgrade Pakistan’s required infrastructure right now. It is part of the larger plan called “One Belt, One Road” (OBOR), which the Chinese government backs. As of 2017, its value had gone up from $46 billion to $62 billion, which is a lot.

CPEC’s plan to upgrade Pakistan’s required infrastructure and strengthen its economy is to build energy plants, special economic zones, ports, and transportation networks.

History of the CPEC

Since the 1950s, people have talked about building economic corridors from China’s interior to Pakistan’s ports on the Arabian Sea. Since the Gwadar port opened in 2006, Chinese interest in that part of the world has grown again.

Due to the Waziristan War and the subsequent removal of General Parvez Musharraf in Pakistan’s northwest, work on a port has been put on hold.

In 2013, President Asif Ali Zardari and Premier Li Keqiang promised to keep getting closer by signing several agreements to work together to strengthen its economy. These MOUs were part of a long-term plan to build the CPEC, which would first be part of the Silk Road Economic Belt. Prime Minister Nawaz Sharif met with Premier Li Kequiang in China to discuss plans, which led to the project’s full scope being made public.

China and Pakistan have agreed to start building the China-Pakistan Economic Corridor with an investment of $46 billion, equal to 20% of Pakistan’s annual GDP (CPEC).

After the port of Gwadar is finished, CPEC will be a part of the Maritime Silk Road of the 21st century.

New Updates With the CPEC

On August 12, 2015, in Karamay, China and Pakistan worked out 20 new deals worth $1.6 billion to make CPEC much bigger and better. Details of the programme are still unclear, but it will likely focus on improving the ability to produce energy. As part of the deal, Pakistan and China have agreed to work together on research into space.

In November 2016, China said it would invest another $8.5 billion in Pakistan. $4.5 billion would improve the tracks, speed, and signalling on Pakistan’s main railway line from Karachi to Peshawar. The other $4 billion would go toward an LNG terminal and transmission lines to help with energy shortages. In February 2017, the Egyptian Ambassador to Pakistan showed interest in working with CPEC. According to Khyber Pakhtunkhwa’s chief minister, Chinese investment groups told him in January 2017 that they would put up to $20 billion into projects.

At the end of September 2017, work was on projects worth more than $14 billion. In March 2018, Pakistan said that after the energy projects already being built were finished, future CPEC energy projects would focus on hydroelectric projects.

What Are the Most Common Issues With the CPEC?

Many people who are against CPEC see it as an experiment in neo-imperialism, especially credit-imperialism. There are also the following things to worry about:

• Several media outlets in Pakistan have criticised the project’s funding for being unclear. One even said that the research showed that “there is far too much secrecy and far too little transparency.”

• The trade imbalance is also worrying since Chinese goods have made it to the local Pakistani market via the Karakoram Highway. These goods are cheaper than those made in Pakistan, where higher production costs.

• Some Baloch nationalists worry that the large-scale CPEC building projects will cause local people to “lose control” of natural resources. Some people have said that CPEC is a “plan” to reduce the number of Baloch people in Pakistan by encouraging people from other parts of the country to move there.

• So, people who live in the areas where these projects will be built are worried about their health and benefits.

Issues with CPEC

• CPEC is at risk of terrorism and other security problems because it goes through Pakistan-occupied Kashmir (PoK) and Baluchistan, which have long-running insurgencies.

• Because of questions about the CPEC project’s openness and accountability, there are more worries that it may be set up to benefit China economically and strategically.

• As part of its “dissemination of Chinese culture” plan, China wants to spread its ideas and culture across Pakistan through the terrestrial distribution of broadcast TV. The town of Mandalay in Myanmar has also become more religious, which has changed the architecture and culture of the area.

• China may try to control Pakistan’s foreign policy, making tense relations with India even worse and causing political instability. China’s policy of not working with local companies won’t help Pakistan create regional jobs.

• Changes in the government of Afghanistan could hurt the benefits of South Asian transit routes in a big way.

Conclusion

In the future, India’s policy push on CPEC must be based on a thorough look at the likely benefits and limitations of the OBOR programme.

The Asia-Africa Growth Corridor results from economic cooperation between India and Japan. It could give India important strategic benefits and compete with China’s OBOR plan.

Indian strategic projects like the Bangladesh-China-India-Myanmar Economic Corridor (BCIM) and the Chabahar Port should be moved up.