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China-Pakistan Economic Corridor: Should India Worry? – Analysis

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By Pramod Jaiswal and Aditi Paul*

The groundbreaking ceremony for the new expressway, linking Peshawar and Karachi, was held on the first week of May this year in Pakistan. It is the single biggest transit project planned for the China-Pakistan Economic Corridor (CPEC) which is a key project of China’s “One Belt, One Road Initiative”. The Peshawar–Karachi expressway will be 392 kilometers long, with a total contract cost of USD 2.9 billion, with a designed speed of 120 kilometers per hour. The construction of this huge infrastructure in Pakistan with Chinese investment has raised India’s security concerns. In this context, it would be worthwhile to understand CPEC, the feasibility of the project, China’s vested interest, strategic moves or calculations of the Pakistan Army, and the impact on India’s national interest.

Regionalism has failed to take off in South Asia due to political differences, congeneric economies, socio-religious cleavages and deep rooted conflicts between the states, particularly India and Pakistan. These differences have not only created an obstacle for proper galvanization of interest both within and around South Asian Association for Regional Cooperation (SAARC), but its procedural and operational products, such as the South Asian Free Trade Area (SAFTD) and other regional economic agreements are also suffering from lack of commitment. As a result, the member states of SAARC have chosen to collaborate with extra-regional powers in various bilateral and trilateral engagements. China has shown special interests in South Asia and the potential vast market that the region provides. However, it is the emerging power’s most ambitious geo-political and economically significant initiative called ‘One Belt, One Road’ (OBOR) that has necessitated China to befriend states of Asia, Europe, Middle East and Africa. It is through OBOR that China is building roads, railways, pipelines, communication networks and industrial economic zones for connecting and expanding its partnerships beyond Asia.

One such connecting thread in OBOR is the CPEC. It connects West China with Arabian Sea and seeks to economically transform the area from Pakistan to China’s north western Xinjiang province through a network of highways, railways and pipelines spreading across 3000 kilometers. CPEC provides China the opportunity to access the Arabian Sea and the Indian Ocean. According to the five year development plan of China, CPEC values 17 percent of Pakistan’s GDP and has the capacity to generate more than 25000MW of electricity to the energy starved Pakistan.

Mega projects, like CPEC, require secure and stable environment for not just its construction but to reap its sustainable benefits. Pakistan is beset with political, economic, socio-cultural and security issues. And, it seems there is no safety for the USD 46 billion investment. Nawaz Sharif government believes that, if implemented successfully, CPEC will be a game-changer. It will provide economic growth and help to overcome threats from terrorism. But, the successful implementation of CPEC depends on the political situation of Pakistan. The state is entrenched with inter-provincial conflicts. There are repeated distress raised by the provinces on the massive and unequal distribution of resources, and non-transparent nature of the government’s actions on CPEC.

On the other hand, the Pakistani business communities believe that they are in a non-benefitting situation and the cheap Chinese products will harm the indigenous manufacturers. The economists argue that since the Chinese imports will have reduced or no taxes; there is a possibility that Pakistan’s economy will be negatively impacted and a steep decline in the revenue collection is estimated. In addition, the federal government of Pakistan has promised to build the western route so as to benefit Balochistan and Khyber Pakhtunkhwa, but its implementation is unlikely. As a result, CPEC is facing less encouragement from the political and economic stakeholders, and local people. Added to which, the whole Pakistan-China collaboration is being touted as Nawaz’s own political ambition.

Considering the conflict ridden state in Pakistan, China demands support and encouragement from the Pakistan army generals. Pakistan’s army has always played a dominant role in shaping and guiding Pakistan’s foreign and security policy. The state has sailed through four military coups since its independence in 1947. Interestingly, the Pakistan Army has taken special interest in this project. It called for installing a CPEC Authority for efficient plan execution. Over 15000 troops have been set up for overlooking the security of the Chinese workers and contractors involved in upgrading the transit facilities based in Balochistan, the stronghold of Afghan and Pakistan Taliban forces. However, it is argued that the greater involvement of the army vis-à-vis developmental projects with the external powers may heighten the ever-present civil-military tensions in Pakistan.

It is no secret that Pakistan is a breeding ground for dissensions and rebel groups. It becomes tedious then for viable bilateral and multilateral projects to work and sustain. For example, the Baloch rebels have constantly opposed the CPEC, and threaten to attack the people involved and destroy the infrastructures. Yet, projects like CPEC are important for the growth and prosperity of Pakistan. The proposed corridor and a place in the OBOR plan, has brought economic and strategic implications for Pakistan. As a result, crucial steps have beeb taken to remove obstacles in the path of CPEC. According to Media reports, the China Great Wall Industry Cooperation and the Pakistan Space and Upper Atmosphere Research Commission have signed an agreement to install a Pakistan Remote Sensing Satellite (PRSS-1) System, to be launched in June 2018, for safeguarding and monitoring the execution of the plan.

Amidst these developments in the neighborhood, India is alarmed. It has objected to CPEC on the grounds that it runs through the disputed territory – Pakistan-occupied Kashmir (PoK). India has claimed that three divisions of the Chinese Army are stationed in the PoK. Yet, there is clear lack of public debate on the impact of CPEC on India. The strategic thinkers need to articulate a clear stand on the situation because after the CPEC completes, China would have total access to the state of Pakistan and not just to PoK. Therefore, the solution lies in aligning India with its ‘strategic partners’ and devise a pragmatic move at the earliest.

*Dr Pramod Jaiswal is Senior Research Officer at Institute of Peace and Conflict Studies, New Delhi and Aditi Paul is Research Scholar at Nelson Mandela Center for Peace and Conflict Resolution, Jamia Millia Islamia, New Delhi. They can be reached at: [email protected]


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South Asia Monitor

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South Asia Monitor is an independent web journal and online resource dealing with strategic, political, security, cultural and economic issues about, pertaining to and of consequence to South Asia and the whole Indo-Pacific region. Developed for South Asia watchers across the globe or those looking for in-depth knowledge, reliable resource and documentation on this region, the site features exclusive commentaries, insightful analyses, interviews and reviews contributed by strategic experts, diplomats, journalists, analysts, researchers and students from not only this region but all over the world. It also aggregates news and views content related to the region.

12 thoughts on “China-Pakistan Economic Corridor: Should India Worry? – Analysis

  • May 28, 2016 at 7:10 am
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    Except Punjab all other states of Pakistan are calling CPEC as China-PUNJAB-Economic-Corridor. There are solid reasons of discriminations behind it. India should fish in troubled waters somehow or the other.

    Reply
    • May 29, 2016 at 4:55 am
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      Pakistan army will never allow anyone to fish so called troubled water, its indian fools dream that it can sabotage cpec

      Reply
  • May 29, 2016 at 5:20 am
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    The great game in south asia has just started. Its not only India that is worried about CPEC, but most of the gulf countries and Iran, as it will change the socio-economic dynamics of the region

    Reply
  • May 29, 2016 at 7:29 am
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    Kindly correct this information. Peshawar to Karachi Expressway (Motorway) is not 392 Kilometer. Secondly, you gave an impression in writing that all will be done by China in terms of Motorways etc, but in reality, already a motorway is there from Peshawar to Islamabad to Lahore to Faisalabad and few other locations between Lahore to Karachi. So most of expressway roads are already present and new are constructing to link Gwadar in the shortest way to China. No doubt, Chinese businessmen will take lead over local businesses but again Chinese are installing huge factories for clothing and other stuff in Faisalabad that will result in employment generation. Faisalabad is the hub of cotton and textile industry so a facotory with 1 million looms will surely make difference when maximum capacity of Pakistani businessmen factory is 100,000 looms. So overall it is good project for Pakistan and it’s people, and Army is turly after it to make it successful, along with general public.

    Reply
  • May 29, 2016 at 2:08 pm
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    Gwadar is the icing on the cake. Pakistan and China are bringing back the good days. Chahbahar is wholly reliant on Afghanistan to be stable otherwise the w whole project is a non starter and Afghanistan isn’t going to be stable any time soon. GWADAR is right on the middle of the Arabian sea it can connect the world, in shortest route possible. As for baloch separatists, the army has already put the rebellion down, even the Baloch people are ready to take the initiative. Pakistan is cleaning its mess that has accumulated since last 40 years. Gwadar will Compliment Karachi which will be bought back online. People don’t understand the relationship between Pakistan and china. But they are about to find out. Pakistan zindabad

    Reply
  • June 23, 2016 at 10:01 am
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    I think india has no way except to realize that development os south asia lies in cooparation between south asian countries. All Pakistani are on same page on CPEC projects. I am from KPK , and hopefully, this project will increase prosperity in the country

    Reply
  • October 29, 2016 at 4:22 am
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    India can also join CPEC with solving Kashmir issue with Pakistan and I think India can gain more benefits when connected with CPEC because they can only connect their country with CAREC, Russia, Turkey, Iran through Pakistan only.

    Reply
  • November 26, 2016 at 7:58 am
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    It is necessary for India and Pakistan to be in peace and play for peaceful means, if both countries are committed for the development of their people. prosperity lies in peace avoid controversial comments especially by media—-misleading the people of two countries.India and Pakistan are two brothers of the same father that is sub-content and two brothers can have differences but can go together when attacked by outsiders.It is early to realize and go into peace at any cost. Nobody will loose when they are together. Jammu & Kashmir should not be the cost of millions,but if it is there between the two, both can survive. If war goes nobody will survive and nobody will be in gain. Life is precious ,save it and save others too.

    Reply
  • December 31, 2016 at 7:38 pm
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    Old history of India reflects that India wants to fail CPEC at any cost. But the question is China. India do not want to create tensions with China, as he cannot afford. Up today, Indian Govt. did not find a way to do so, his policy is too much conflicted. India do not have solid reasons to appose CPEC, as he knows Gilgit Baltistan in not a part of Jammu and Kashmir. In my views if Indian Govt. is sincere to his people, must become a part of CPEC, as the only way to connect with Iran, Iraq, Turkey, Afghanistan etc etc is from Pakistan. But this will India not do in near future. He will do his best to fail this mega project. He is a pure enemy of Pakistan.

    Reply
  • January 6, 2017 at 12:33 pm
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    “The Peshawar–Karachi expressway will be 392 kilometers long”

    This statement alone shows how authentic the research is or how much the authors know about their neighboring country.

    Ps the distance is around 1100 km.

    Reply
  • January 6, 2017 at 10:02 pm
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    A very funny question for the title. India is worried about any thing of China and Pakistan.

    Reply
    • January 24, 2017 at 11:49 pm
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      Sir .china and Pakistann are worried about the development of India by the police of india.
      India is not worried.
      When india went to get membership in NSG china opposed and support Pakistan because china and Pakistan both know that if we will not creat obstacles in the path of India,it will be super power in future.whether china oppose or not india will become super power.

      Reply

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