China Pakistan Economic Corridor [CPEC] By Abdul Salam Dadabhoy

BACKGROUND: CPEC, as and when completed, will be one of the biggest objective and achievement of Pakistan, since its independence in 1947. This dream and vision, or something strikingly more or less similar, was envisioned by General Zia – Ul – Haq (Shaheed), General Akhtar Abdul Rehman (Shaheed) and top brass of the Pakistan Army, way back in the 1980’s, after the Russians were pushed back from Afghanistan.

General Zia – Ul – Haq was often quoted as saying that he longed to see a day, when he would be able to offer any prayer of the day at Kabul, at sweet will and wish. His idea of a unified block, market and region, from South Asia to Central Asia, with a common currency, bilateral trade and land, sea and rail routes, is what presumably and allegedly got him and the entire top brass of Pakistan Army killed, in a plane crash in August 1988.

WHAT IS CPEC: The China Pakistan Economic Corridor is a conglomerate of projects at a cost of 46 billion US Dollars plus, which is intended to rapidly expand and upgrade Pakistan’s infrastructure, as well as deepen and broaden economic ties between Pakistan and China. The corridor is considered to be an extension of China’s proposed 21st century Silk Road initiative and is considered significantly important in China and Pakistan relationship. While economic opportunities and developments will largely benefit Pakistan, CPEC’s importance to China’s geopolitical and economic ambitions is reflected by the inclusion of the project as part of China’s five year plan. If all the planned projects are implemented as envisaged, the value of these projects would be equal to all foreign direct investment in Pakistan since 1970 and would be equivalent to 17% of Pakistan’s gross domestic product of 2015. It is estimated that the corridor will create some 500,000 to 700,000 jobs between 2015 and 2030 and add up to 2.5 percent to the country’s growth rate. Infrastructure projects under the auspices of CPEC will connect the length and breadth of Pakistan and will eventually link the Pakistani city of Gwadar in Pakistan’s southwest to China’s northwest region of Xinjiang, via multiple networks of highways and railways. Proposed infrastructure projects are worth approximately 11 billion US Dollars and will be financed by very soft loans, at an average interest rate of 1.6%, which will be disbursed to the Government of Pakistan. As part of infrastructure projects, a 1,100 kilometers’ long motorway will be constructed between the cities of Karachi and Lahore, while the Karakoram Highway between Rawalpindi and the Chinese border will be totally reconstructed. The Karachi and Peshawar main railway line will be upgraded to allow for train travel, at up to 160 kilometers per hour, by December 2019. Pakistan Railways network will be extended to connect to China’s Xinjiang province. A network of pipelines to transport liquefied natural gas and oil will also be laid as part of the project, including a 2.5 billion US Dollars pipeline between Gwadar and Nawabshah, to eventually transport gas from Iran. Over 33 billion US Dollars worth of energy infrastructure will be constructed by private consortiums, to help alleviate Pakistan’s energy shortage, which amounts to 4,500 MW and have reduced an estimated 2% off Pakistan’s GDP. With approximately 33 billion US Dollars expected to be invested in the energy sector, power generations occupy an important role in the proposed CPEC. Over 10 thousand MW of energy generating capacity is to be developed between 2018 and 2020, as part of the corridor’s fast track early harvest plans, in conjunction with four projects under construction, prior to the formal announcement of CPEC.

ADVANTAGES: 1) Social, Cultural, Educational, Technological and Trade Connectivity between 3 billion people of Asia; 2) Uplift of backward areas of Balochistan and KPK in Pakistan; 3) Uplift of backward Chinese areas neighboring Pakistan; 4) Significant reduction of freight costs for china’s trade, bulk of which is transited from Dubai; 5) Rail and road links between South and Central Asia; 6) Infrastructural development in Balochistan and KPK; 7) Lesser dependence on Europe and USA and more reliance on a time tested partner; 8) Technological and military advancements and exchanges; 9) Shut up call to and a fire wall against sinister designs of arch rival India and 10) Construction of new and up gradation of Pakistan’s existing highways and railways.

THREATS: 1) Regional threat emanates from Iran whose Chabahar and Bandar Abbas ports would experience much lesser trade load and frequency than before in case of a fully operational CPEC; 2) Imminent threat comes from UAE as because of a functional Gwadar Port their transit trade will plummet; 3) Logical threat comes from India because Afghanistan is land locked and because of CPEC, India despite its’ dreams to become a regional super power would soon become irrelevant in the region and 4) Natural threat is from every enemy of Pakistan which eyes Pakistan as a nuclear armed Muslim country with China’s mega trade moving from this region and Pakistan’s transit trade earnings, which will soon free Pakistan from the death traps of loans and debts threatening solvency and bankruptcy.

CONCLUSION: The CPEC is not a national but a regional game changer. Pakistan Army has taken exclusive and special initiatives for the successful completion and operation of CPEC and associated projects, some of which include; 1) A 900 kilometers highway to Gwadar, 800 kilometers of which has already been completed by Frontier Works Organization (FWO); 2) A special division of the Pakistan Army headed by a 2 Star General to secure and protect Chinese investments and personnel; and 3) A special wall being built around the Gwadar Port to protect against short and long range missiles etc.

BOTTOM LINE: One most important decision which remains to be reviewed by the COAS is not to leave CPEC at the mercy of the current lot and therefore to reconsider not to hang his uniform before the CPEC is up and about, in the largest interests of this nation and region !!

 

About the writer::

Salam is a Director of the Dadabhoy Group, he is an ardent writer / blogger and has served as Vice Chairman of the Korangi Association of Trade and Industry.

Graphic Designed by::

Iftikhar Ahmed Khan, SMT member, Central Creative Team

by webmaster@insaf.pk (tkiadmin)