Daily Times

Pakistan occupies a unique geo-strategic position on the world map. Located in the crossroads of Asia, bordered by Iran in the west, Afghanistan in the northwest, China in the northeast, India on the east and the Arabian Sea in the south, Pakistan lies in a region which has great political, economic and military importance.

The China-Pakistan Economic Corridor (CPEC), a flagship project of President Xi Jinping’s Belt and Road Initiative (BRI), has further raised Pakistan’s global profile. From ‘the world’s most dangerous country’ around 10 years back, Pakistan is now being seen as the next economic success story in the world.

In January 2017, The Economist depicted Pakistan as the world’s fastest-growing Muslim economy, even ahead of Indonesia, Malaysia, Turkey and Egypt. A Bloomberg report has also picked Pakistan as the most underrated economies of the world for the year 2017.

As one of the six pillars of the BRI, the CPEC is the paw of both China and Pakistan in reconfiguring geo-economic-cum-political realities. For China, it provides an alternate and secure route to import energy and find new markets for its goods and services. For Pakistan, it helps position itself as a major transit point connecting Eurasian region with South Asia and South East Asia and provide a much-needed base to kick-start its economic growth, besides countering Indian influence in the region.

With a total length of approximately 3000 kilometres spanning from Gwadar port to Kashghar in northwestern China’s Xinjiang Uygur Autonomous Region, the over $60 billion planned investment ranges from development of a deep-sea port in Gwadar to high-speed railways, motorways, energy projects and urban mass transit systems. The four main areas of collaboration between the two countries are: infrastructure, transportation, energy and industrial cooperation.

The large influx of investments from China has already started to show its impact, with social sectors beginning to improve and commercial attractiveness for foreign investments from other developed economies of the world enhanced.

As part of infrastructure and transportation projects, the CPEC initiative envisions an extensive overhaul of the existing transportation infrastructure in Pakistan and laying out of new routes for the facilitation of transit trade and enhancement of market accessibility. A 1100-kilometre-long motorway is already being constructed between Karachi and Lahore, while overhauling of Karakoram Highway leading to Chinese border remains a top priority. Under the initiative, Pakistan’s railway network will be extended to eventually connect to China’s Southern Xinjiang Railway in Kashgar. The Karachi-Peshawar main railway line will be upgraded to allow for train travel at up to 160 kilometers per hour by December next year. A network of pipelines to transport liquefied natural gas and oil will be laid as part of the project.

Recognising the growing energy needs of Pakistan and to overcome the deficits, a major proportion of CPEC funds was allocated to energy generation and transmission. A couple of energy projects have already completed and started contributing power to the national grid, reducing load shedding in at least 70 percent of the country to almost zero.

A wave of industrialisation in Pakistan as part of the CPEC will help to create jobs for the country’s large, under-employed population, turning a social and fiscal burden into an economic and developmental driver. Pakistan hopes technology transfers and spillovers from China, with relocation of complete industrial units including that of low-end textile manufacturing, food processing, fertiliser, steel, automobile, chemicals and plastic manufacturing industries. Recently, the two counties have identified nine sites as priority Special Economic Zones in Pakistan under the CPEC.

Apart from its economic benefits, the CPEC will truly prove to be a ‘Corridor of Peace’ for the region by creating an environment whereby several South Asian countries would be attracted to seek peace in the region to fully tap on the financial incentives offered by the multi-billion dollar initiative.

Despite numerous opportunities offered by the CPEC, the project entails some challenges as well. The leadership in Pakistan needs to enhance political and social governance, put long-term and sustainable security mechanisms in place and build the matrix of its foreign policy keeping in view the highly complex geopolitics in South Asia if it wants the CPEC dream come true in letter and spirit.

Published in Daily Times, March 16^th 2018.