China Pakistan Economic Corridor [CPEC]

By : Neha Dhyani

Updated : Jun 1, 2022, 10:14

The China Pakistan Economic Corridor [CPEC] is a group of infrastructural projects built across Pakistan. It is part of the Chinese government's larger One Belt, One Road (OBOR) plan. It was initially valued at $46 billion, but as of 2017, it is currently worth $62 billion. The China-Pakistan Economic Corridor is a massive project that would link Kashgar in China's Xinjiang province with Gwadar port in Pakistan's Baluchistan state.

The China Pakistan Economic Corridor [CPEC] project aims to build energy development, special economic zones, harbours, and transport systems to update Pakistan's necessary infrastructure and enhance its economy quickly.

China Pakistan Economic Corridor [CPEC] - Some of the Worries

Several Pakistani news organizations have attacked the project's finances as cloaked in mystery, with "much secrecy and far too little openness."

The trade imbalance is also a problem since Chinese goods via the Karakoram Highway have entered the local Pakistani market cheaper due to Pakistan's higher manufacturing costs.

Some Baloch nationalists reject the China-Pakistan Economic Corridor's massive development initiatives, claiming that local communities may "lose control" of natural resources.

India's Stance On the China Pakistan Economic Corridor [CPEC]

The Indian government, which has strained relations with Pakistan, opposes the China-Pakistan Economic Corridor project because the Karakoram Highway is being upgraded in Gilgit Baltistan, which India claims as its own.

Vijay Kumar Singh, India's Minister of State for External Affairs, highlighted reservations over the China-Pakistan Economic Corridor in May 2016. Despite Indian reservations, China and Pakistan began construction on the $44 million Pakistan-China Fiber Optic Project on May 19, 2016, which would traverse through Gilgit-Baltistan, the same territory about which India has voiced concerns about China.

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Problems with China Pakistan Economic Corridor [CPEC]

The China-Pakistan Economic Corridor passes across Pakistan-occupied Kashmir (PoK) and Baluchistan, both of which have long-standing insurgencies and are vulnerable to terrorism and security threats.

The lack of openness and accountability in the China-Pakistan Economic Corridor project is concerning since it may be tilted economically and strategically in China's favour.

The Chinese strategy of not collaborating with local businesses would not help Pakistan create jobs.

The project may jeopardize Pakistan's sovereign power by allowing China to dictate its foreign policy, particularly with India, complicating already strained relations and causing political turmoil in South Asia.

Political tensions in Afghanistan may also obstruct the benefits of transit corridors in South Asia.

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China Pakistan Economic Corridor [CPEC] - Implications for India

Since it crosses through Pakistan-occupied Kashmir's Gilgit-Baltistan, India has been staunchly opposed to the project, which Pakistan denies.

When China-Pakistan Economic Corridor is entirely operational, China will be able to offer most North and Latin American businesses a "shorter and more cost-effective" trading route.

China's Belt and Road Initiative (BRI), which focuses on commercial connections between China and the rest of Eurasia via a network of ports, highways, and trains, has been seen as China's attempt to dominate the area politically. China-Pakistan Economic Corridor is a huge step in the right direction.

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FAQs on China Pakistan Economic Corridor [CPEC]

Q.1 Who was the one who started China Pakistan Economic Corridor [CPEC]?

President Asif Ali Zardari and Premier Li Keqiang signed several memorandums of understanding on economic cooperation in 2013 to improve mutual connectivity. China and Pakistan inked agreements on August 12, 2015, in the city of Karamay.

Q.2 Latest News regarding China Pakistan Economic Corridor [CPEC]?

Pakistan and China have inked a new deal to start the second phase of the $60 billion China Pakistan Economic Corridor [CPEC]. The second phase focuses on the development and industrialization of Special Economic Zones (SEZs).

Q.3 What is the Distance covered by China Pakistan Economic Corridor [CPEC]?

The China Pakistan Economic Corridor [CPEC] is a 3,000-kilometer infrastructure project that connects China's northwest Xinjiang Uygur Autonomous Region with Pakistan's Gwadar Port in the western province of Balochistan.

Q.4 What should be the possible next step for India for China Pakistan Economic Corridor [CPEC]?

The Asia-Africa Growth Corridor is an economic cooperation pact between India and Japan that can offer India significant strategic benefits while countering China's OBOR initiative. India could accelerate construction on critical projects, such as the Bangladesh-China-India-Myanmar Economic Corridor (BCIM) and the Chabahar Port.