China-Pakistan Economic Corridor (CPEC)

China-Pakistan Economic Corridor (CPEC)
As the diplomatic relationship between China and the United States continues to evolve, the East Asian nation also has reason to cozy up to Pakistan. In recent months, the government of Pakistan has made certain decisions which have inevitably led to the country being drawn further into China’s geopolitical attention.

About 5 months ago, Chinese President Xi Jinping was in Islamabad, Pakistan where he unveiled a $46 billion infrastructure spending blueprint for Pakistan, to serve as a linchpin of Beijing’s drive to open new trade and transport routes across Asia. Despite decades of mismanagement and a feeble socioeconomic infrastructure, Pakistan does enjoy a strategic location. Among its neighbors, the only one with which Pakistan has maintained cordial ties since independence is China. Enjoying genial relations with a neighbor that is also a major power is clearly a plus for an otherwise diplomatically isolated Pakistan.

For China, which has begun to build a presence in multiple regions, Pakistan is a gateway to the Gulf States and Middle East, where China seeks to showcase its soft power, and develop trade and diplomatic links. While the U.S. still dominates in the Middle East, China has certainly made ground over the past decade. It wants to continue that progress, and supplementing its energy trade, improving the balance of trade, and identifying new investment opportunities with more robust commercial links will be vital. Securing a route to the Indian Ocean via the port of Gwadar will do the job nicely, and will also help China develop its military presence in the region.

So Beijing’s decision to establish an economic corridor in Pakistan, switching access to the Middle East from a lengthy sea route to a much shorter (about 750 miles) road journey is a win-win. Xi’s visit saw 51 agreements signed, among them the pledge of $46 billion in investment. Many of the agreements focus on infrastructure development in Pakistan; however, the China-Pakistan Economic Corridor (CPEC) project is the standout development.

The CPEC will run from the Chinese city of Kashgar to the port of Gwadar in Pakistan. Gwadar is a deep-sea port that was initially developed and upgraded by the Chinese, who now have effective control. An all-weather, all-season port, Gwadar is strategically located, particularly vis-à-vis Dubai and Oman. Aware of its importance, China has now decided to lay down road (primarily) and air-train networks (gradually).

Now, with agreements signed and budgets allocated, the respective states are trying to eliminate or at least minimize the hurdles to CPEC that remain. Pakistan in particular has a job on its hands dealing with insurgents operating along the proposed CPEC. The country has been combating an Islamist insurrection for more than a decade. Nonetheless, it still hopes that Chinese investment will spur its long-underperforming economy.

Despite the concerns, the CPEC is potentially a game changer that could transform economic growth and inject some prosperity and capital into Pakistan’s frayed socio-economic fabric. However, it is unlikely to come to fruition in either the short or medium terms. Mega projects like the CPEC all too frequently run aground, either falling prey to a lack of vision or stalling on political tussles. If that happens to the CPEC, it would be a sad outcome for a Pakistan that desperately needs some good news.

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