Brief Report

On
China Pakistan Economic Corridor
A Chinese Dream Being Materialized Through
Pakistan

By
Azher Ishaq 阿泽阳
2093193

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Table of Contents

Introduction 3

Historical relation between china and Pakistan 3

China emergence as global leader 4

China Pakistan economic corridor 4

What is CPEC…………………………………………………………..…………………………4
Major Component of CPEC……………………………………………………………………….5
Recommendations 5

References 6

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Introduction
Sustainable growth and development in china during the past 4 decades has assigned the country
a special status in the world economy. It has been evident from a bulk of studies that
employment is considered crucial for the economy to prosperous. Economic agents if utilized in
a systematic and optimal manner can upgrade the overall economy by improving their own life
standards. It allows employees to enhance their absorption capacity and build their knowledge
causing a “snowball effect” in the future by creating new entrepreneurs in the market, hence,
creating more employment opportunities. A drastic increase in the employment rate of Pakistan
had not been considered more than delusions and fictions until the emergence of CPEC project.

In April 2015, Chinese President Xi Jingping visited Islamabad to inaugurate the China-Pakistan
Economic Corridor (CPEC), a $46 billion investment in Pakistan’s energy and transportation
sectors. As part of China’s One Belt, One Road (OBOR) initiative, CPEC is designed to promote
regional connectivity among Pakistan, China, and Eurasia.[ CITATION Chi15 \l 2057 ]. CPEC is
bound to have geopolitical implications for Pakistan and the broader region, especially given the
scale of the proposed investments and its connection to OBOR.[ CITATION 215 \l 2057 ]

For Pakistan, this corridor is viewed as a symbol of the indomitable relationship it shares with
China. The bilateral relationship between both states is characterized by a high degree of mutual
cooperation and convergence of strategic interests. Hence, it could improve Pakistan’s energy
starved economy and the country’s internal stability, if the projects materialize as envisioned.
Yet, at the same time, Pakistan’s geographical proximity to Afghanistan and constant hostilities
with India require a geopolitical assessment of the corridors expected consequences for Pakistan
and the rest of South Asia. This investment also takes place at a time when the Indo-Pakistan
relationship is marred with suspicions and hostilities, with several incidents such as cross-border
skirmishes, allegations of cross-border terrorism, and the Kashmir dispute characterizing the
relationship.

Historical relation between china and Pakistan

China and Pakistan has been enjoying the friendly relation since 1950. At first the two countries
did not know much about each other which hindered their bilateral cooperation. Fortunately at

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that time the foreign affair minister sir zafarrulah khan have some Chinese knowledge and he
understand the mindset of Chinese, which paved the way if China Pakistan relationship.

From 1970s onward the relationship between China and Pakistan strengthen more and more in
all sectors. China has supported Pakistan in military, missiles, nuclear programs and economic
sectors even during the sanction imposed by US. This led to confidence between policy makers
both side in china and Pakistan. As a result if this long standing friendship we see big
achievement in the form of CPEC.

China emergence as global leader

China has been working decades to recover its lost glory. Since Mao’s time china has devised a
policy of cosmopolitanism and made it the most important pillar of its all policies. Firstly
Chinese worked with non-allying countries and then go on to international market, they did not
took part in any negative activity and remain neutral and mainly focused on the economic
development of the county.

The first step on the development was to maintain good relation with south east countries during
the financial and economic crisis of 1990s. It was also the beginning of change of relations with
different Asians countries. During that period china emphasized its relations with Middle East
central Asia and Africa.

China Pakistan Economic Corridor

What is CPEC?

CPEC is a planned corridor constituting an array of different energy projects,

transportation/infrastructure networks, and economic free zones within Pakistan. This investment
is part of China’s OBOR strategy, which includes the Silk Road Economic Belt and the 21st
Century Maritime Silk Road. The investment constitutes a total sum of $46 billion directed at
upgrading Pakistan’s existing transportation infrastructure, as well as boosting Pakistan’s energy
generation capacity. The proposed special economic zones (SEZs) would follow if the energy
and infrastructure projects prove successful. CPEC links the strategically significant city of
Kashgar in China’s Xinjiang province to the port of Gwadar in Pakistan’s Balochistan province.

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The proposed route allows the passage of goods and services between China and Pakistan. It also
gives China access to the Middle East given Gwadar’s proximity to the Arabian Sea.

Major Components of CPEC:

 Pakistan’s Energy Sector

The largest component of CPEC deals with Pakistan’s energy sector. A total of $ 33
billion or approximately 72 percent of the proposed $46 billion investment relates to
energy-resource development, including gas and electricity generation through natural
resources such as coal.

 Transportation Infrastructure

The second largest component of CPEC is investment in Pakistan’s transportation

network. Specifically, $11 billion or approximately 24 percent of the proposed $46
billion is directed toward enhancing Pakistan’s transportation infrastructure, including
highways and railway networks.

 Special Economic Zones

Since CPEC falls under the umbrella of the OBOR, it places special importance on the
promotion of regional connectivity across the Eurasian continent. Regional connectivity
will be promoted through the establishment of SEZs aimed at facilitating industrial
growth in key financial centers and strategically significant locations in Pakistan.

Recommendations

1. Government must take some decision on the basis of economic gains and multiplier
impact on the economy.
2. Route prioritization must decide on the basis on population density.
3. Strategic importance and its relevance for Pakistan and China.
4. Transparency must be ensured.
5. Government must use all the institutions and resources to resolve controversies related to
CPEC.

References
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2. (2015). GDP Ranking Data," The World Bank, 2015. Retrieved from
http://data.worldbank.org/data-catalog/GDP-ranking-table

China Radio International, F. T. (2015, March 29). Retrieved from

http://english.cri.cn/12394/2015/03/29/2941s872030_1.htm

https://www.jstor.org/stable/resrep02843?seq=8#metadata_info_tab_contents

http://www.thehindu.com/news/national/us-backs-but-china-opposes-indias-nsg-
bid/article8601776.ece