Gwadar Port

Introduction

On 8 September 1958, Pakistan purchased Gwadar Enclave from Oman for $3 Million. Gwadar
port is the warm water and deep sea port of Pakistan. It is situated at the mouth of Persian Gulf,
strait of Harmuz and holds two-third world oil reserves. During its construction phase from
1988-1992, small port was constructed. In 2007 Gen. Musharaf inaugurated the port. From 2007-
2012, Gwadar port remained under the SPA (Singapore port authority) but due its poor
performance, the port was handed over to China Overseas Port Holding Company in 2013 for 43
years.

Pakistan’s Gwadar Port, renovated and expanded with the assistance of China, was
finally operationalized, with the first set of Chinese trucks arriving at the port and their contents
being shipped overseas. Located close to international oil trade and sea shipping routes and being
an integral instrument of the China-Pakistan Economic Corridor (CPEC), Gwadar Port holds
immense geostrategic and geoeconomic importance for both countries, and could bring countless
benefits.

Benefits for China

 Gwadar is a deep-sea port located at the mouth of the Strait of Hormuz, a vital location
for China’s various economic projects including “One Belt, One Road” (OBOR) and the
Maritime Silk Road.
 It is the most economical route from China to the Central Asian states—Chinese imports
travel around 10,000 km from the Persian Gulf to China’s eastern region. Gwadar
provides a much shorter approximately 2500 km, less expensive route for importing oil
and gas from the Middle East and minerals from Africa.
 From a strategic point of view, since the Gwadar Port provides China with uninterrupted
access to the Arabian Sea, it will put the Chinese Navy in a position to monitor oil routes
and trade links to South Asia, and keep track of any Indian activities in the Arabian Sea
and Persian Gulf.

Benefits for Pakistan

 Pakistan will earn through freight and cargo handling charges as China, Central Asian
states, and others use the port for trade.
 An industrial free zone is also being established around the port, which will be a hub for
manufacturing and port-related business and industry and is expected to generate 40,000
jobs.
 The development of Gwadar Port will also alleviate security issues. Pakistan is facing an
insurgency in Baluchistan province, the home of Gwadar port. Once the Gwadar projects
 under CPEC are completed, they will transform Gwadar from an underdeveloped city
into a prosperous international economic hub, and bring prosperity to the region. Since
poverty is one of the main causes of the rise of militancy in Baluchistan, these economic
benefits and the creation of jobs will minimize violence, and will eventually help in
curbing the insurgency.
 The expansion of Gwadar port will also provide Pakistan an opportunity to strengthen its
regional relationships. For example, Russia expressed an interest in using Gwadar port
for trade because it can provide Moscow access to warm waters, and Pakistan
consequently allowed it. This is yet another symbol of growing Pakistan-Russia ties, and
CPEC, specifically Gwadar, can be an instrumental force in bringing the two closer
together. Iran and Turkmenistan have also expressed an intention to join CPEC.

 The expansion of the port will enable Pakistan to leverage trade links and oil sea routes
connecting South Asia, Central Asia, Africa, the Persian Gulf, and the Middle East.

Conclusion

Once fully operational, Gwadar Port will become an important source of regional connectivity.
Not only will it provide economic opportunities to regional actors, but it will also benefit local
populations in Pakistan that have been denied growth for decades.

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