Daily Times

The China Pakistan Economic Corridor (CPEC) has come to symbolise a strong bond of friendship between the two countries. Pakistan has ardently welcomed Chinese investment under CPEC and described it as a sign of the brotherly relations between Beijing and Islamabad. However, in international politics friends and foes are determined by national interest. The same principal applies to CPEC as far as China is concerned. Chinese investments under CPEC are not a gift. They are a manifestation of China’s vision and farsightedness in pursuing its national interest. It needs CPEC as much as Pakistan does, if not more.

Strategically, CPEC enables China to escape its so-called Malacca Dilemma. Presently, a major bulk of China’s trade, including 80 per cent of its oil imports, is routed through the Strait of Malacca in the South China Sea. The United States has a strong military presence in the region. In 2012, the then US Defence Secretary Leon Panetta revealed that America would shift 60 per cent of its naval fleet to the Asia Pacific region by 2020. America is also supporting China’s neighbours in territorial disputes over various islands in the region. China’s rival India also possesses a well-equipped naval base at the Andaman and Nicobar Islands in the Bay of Bengal. American military presence in the region and its strategic ties with New Delhi, has stoked fears in China of a possible blockade of the Strait of Malacca. CPEC provides an alternative route through the friendly territory of Pakistan. Moreover, the Gwadar Port places China at the mouth of the Persian Gulf through which it imports most of its oil. Therefore, in the future China can be expected to station its naval forces at the port in order to guard its oil supplies.

Sri Lanka is already reeling from the effects of Chinese debt. It had to lease out its Hambantota port to China for 99 years as a consequence of not being able to honour its debt commitments. Pakistan is also borrowing loans from China to finance projects under CPEC. If it too fails to return the loans in time, one can expect Beijing to dictate terms to Islamabad for their own advantage

Economically, CPEC offers many dividends to China. The corridor reduces China’s trading distance by around 8,000 km. This will also decrease the transportation time from 30 days to less than a week. Thus, the corridor provides a shorter route to markets in the Middle East, Africa and Europe. Besides, it is a land-based route offering greater safety and security compared to the oceanic route.

The so-called ‘Security through Development’ is also possible through CPEC. The corridor will be a major source of development in China’s restive province of Xinjiang. Economic growth leading to jobs and prosperity reduces the incentive for people to join militant organisations like the East Turkestan Islamist Movement. The Chinese have often been irked by terrorists infiltrating its territory from Pakistan. If CPEC accrues well distributed development in Pakistan, particularly Balochistan, peace and stability is likely to prevail in the country. In this way, China can also ensure a peaceful neighbourhood and prevent cross-border terrorism.

China is likely to receive the lion’s share of revenue from CPEC. Pakistan’s ex-Minister for Ports and Shipping has already declared that China will get 91 per cent share of the revenue from Gwadar port. The bilateral balance of trade already favours Beijing. The corridor can be expected to usher in a flood of Chinese products into Pakistan. Besides, Beijing will also reduce the cost of its imports and exports due to the reduced trading distance and transportation time.

Iran has expressed a keen interest in becoming part of CPEC. It is eager to export its oil and gas while China needs energy resources to drive its vast economy. CPEC provides an ideal linkage between the two countries. China can also offset the strategic cooperation between Tehran and New Delhi through robust economic interdependence with Iran. Additionally, CPEC provides an outlet to landlocked Central Asian States. In this way, it enables Beijing to expand its economic and strategic clout in the region.

China’s capacity to grant loans also places the country in a position of strength. Sri Lanka is already reeling from the effects of Chinese debt. It had to lease out its Hambantota port to China for 99 years as a consequence of not being able to honour its debt commitments. Pakistan is also borrowing loans from China to finance projects under CPEC. If it too fails to return the loans in time, one can expect Beijing to dictate terms to Islamabad to its own advantage.

Finally, CPEC is a flagship project of China’s Belt and Road Initiative. Whether BRI will translate into reality or remain a farfetched dream is likely to be determined by the fate of CPEC. Therefore, Beijing is eager to write CPEC off as a great success story.

China’s friendship towards Pakistan should not be taken for granted. A country’s policies ought to be guided by national interests. CPEC is indeed a Chinese policy guided by its wider strategic and economic interests in the world. On the contrary, the lack of transparency on CPEC shown by the former government in Pakistan raises an important question: Is Pakistan’s CPEC policy guided by national interest or personal motives?

The writer is an independent researcher in public policy and international relations. He can be reached at moneeb.barlas@gmail.com

Published in Daily Times, June 30^th 2018.