By Nirali Shah and Esha Rawat

China-Pakistan Economic Corridor (CPEC) is being projected as the solidification of intergovernmental bonds between the two nations. CPEC is a collection of infrastructure projects under construction in Pakistan. The corridor consists of road, rail and power projects. It intends to link Kashgar (Xinjiang Province) in China to Gwadar Port in Pakistan. The project is financed by heavily-subsidized concessionary loans. The loans will be given to the Government of Pakistan by the Exim Bank of China, China Development Bank, and the Industrial and Commercial Bank of China.

In due time, it will boost China’s economy and toughen its foothold over the region.

The CPEC is a part of China regional transnational “One Belt One Road” (OBOR) Initiative. This initiative connects large patches of Asia and Eastern Europe. This will open an energy and trade corridor from the Gulf region across Pakistan to Western China. Also, it could be used by the Chinese Navy for military purposes. CPEC will reduce the distance of 13,000 km sea voyage from the Strait of Malacca to 2000 km road journey from Gwadar to Kashgar. This would give a competitive edge to the Chinese exports. In due time, it will boost China’s economy and toughen its foothold over the region.

CPEC

The China-Pakistan Economic Corridor (CPEC) aims to substitute the 12,900 Km long sea route with a shorter 2000 Km road. | Source: Amazon News

The hidden steps

CPEC will be passing through various Pakistani cities. So, it will help internal trade and help businesses expand. Pakistan would get an infrastructural benefit at a much lower cost as it will only have to pay for the tolls. This seems like a win-win situation but there is a catch too.

The cavorting dragon

Theoretically, the picture seems too rosy. CPEC is being anticipated as a game changer for Pakistan. It has the potential to boost the economy in a state where terrorism has majorly dampened it. However, there is a widespread resentment among citizens of Pakistan as CPEC is widening regional disparity. Furthermore, it is questioning Pakistan’s federal integrity. Moreover, Baluchistan is deprived of any benefits.

While China regards CPEC as an economic project, Pakistan views it as a security project.

China has opened up to Pakistan by playing the “India card” smartly. This grants China access to Middle East, Africa and the Arabian Sea. While China regards CPEC as an economic project, Pakistan views it as a security project. Pakistan hopes that China would help in enhancing security. China plans to mint money by exploiting Pakistan’s insecurity with India.

CPEC

The Pakistani Army has taken over the responsibility of protection of the project. | Source: CPEC News

CPEC has become an encumbrance for a Pakistani commoner. At present, 8000 Chinese are working on CPEC, safeguarded by 16000 Pakistani soldiers. Thus, it implies that opportunist China is doing exactly what the East India Company did to pre-independent India.

In the name of development, China is exploiting Pakistan’s land, resources and cheap human capital.

Evidence shows that China has previously exploited Sri Lanka and Zimbabwe by signing similar projects. These projects look lucrative just on paper. Hence, economic experts are forecasting a similar scenario for Pakistan.

Where does India stand in the picture?

Diplomacy is not game theory and permanency of friendship depends upon mutual economic interest.

Barring the economic disadvantage once China regains “the next bright spot” position, CPEC is a direct attack on India’s sovereignty. Given such synergy between China & Pakistan, India will struggle with its political implications. Since CPEC passing via Pakistan Occupied Kashmir (PoK), Indian Government’s stand is yet awaited. Diplomacy is not game theory and permanency of friendship depends upon mutual economic interest. Ergo, India should concentrate on building its dominance over the Indian Ocean. It is possible by building ports and seeking help from USA and Japan. It is no secret that China and Pakistan are core strategic partners.

If CPEC becomes the next big thing, Pakistan will have surplus funds to deploy its military. Thus, this situation has become dangerous for India. India, being a third party, cannot do much in obstructing the construction of CPEC. Such a move will hamper its relations with its neighbours and dent its global image.

In the wake of the prevalent political scenario, the tension between the once-one-now-two countries seems to grow. The Pakistan Defense Minister Khwaja Muhammed Asif had made a statement threatening India. It stated that if a situation arises, Pakistan will not shy away from using its “tactical weapons”. In response to this statement, the Indian Government performed surgical strikes and claimed responsibility for the same.

The road ahead

Though CPEC looks like an attractive proposition, cooperation from India is a distant reality. India has made its stand clear. India has now decided not only to block all economic ties but also boycott Pakistan on a political front (SAARC) as well. India’s reaction is still to be seen once CPEC starts functioning. Surely, this dance is more of a battle.


Featured Image Source: The News International
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Posted by The Indian Economist