The China-Pakistan Economic Corridor (CPEC), a key infrastructure project within the Chinese One Belt One Road strategy, sweeps through some of the most perilous regions in which to do business. Balochistan, an arid region trapped between Afghanistan, Iran, and the Arabian Sea has historically been a bad place to build. Chinese officials are not discouraged; they have been successfully holding talks with prominent tribal leaders across the region to help safeguard CPEC.
The project is part of an ambitious strategy to overhaul the outdated transportation and energy infrastructure in China’s neighboring countries. Chinese investment is welcome in Pakistan. In 2017, the country is estimated to have lost over 3.5% of its GDP because of its old and inefficient transport system. Pakistan also suffers from a notoriously ineffective electricity infrastructure; a problem that the $60 billion investment from CPEC will also address.
China is not only currying diplomatic and economic goodwill; they are also safeguarding their own interests. The China-Pakistan Economic Corridor runs right through Pakistan to the Baloch sea town of Gwadar that lies on the waters of the Arabian Sea. The Gwadar deepwater port plays a key role in connecting China’s terrestrial One Belt One Road strategy with its Maritime Silk-Road counterpart. It will also be the location of a new liquefied natural gas terminal worth $2.5 billion. Construction starts soon.
While regional economic investment and closer ties with China is welcomed by long-time allies such as Pakistan, others are distrustful. In India, CPEC and the One Belt One Road seem designed to surround their country. CPEC construction in the contested region of Kashmir is also raising tensions in Delhi. The United States, always uneasy about Chinese expansion, have already pulled American funding, as small as it was, from the project. Both countries have been raising the matter with other concerned nations in the region, particularly Japan and Australia.
The Americans are especially worried. CPEC shrinks China’s vulnerability to U.S pressure in the South China Sea and the Strait of Malacca, where most of its shipping must pass. And as much of the One Belt One Road and CPEC investment is financed by Chinese debt, they gain privileged access to the new infrastructure links for decades to come. Gwadar Port was officially leased to the Chinese until 2059 and other strategic locations such as the Sri Lankan port of Hambantota have been leased for longer, until 2116. Fears are rising that any default on these debts could lead to an increased Chinese presence in the region’s maritime chokepoints and to their eventual transformation into military bases.
Promises of investment and support are drawing countries closer to China and away from the United States and their allies. American attempts to slow the progress of CPEC and One Belt One Road have mostly fallen flat and President Trump’s America First worldview is not helping. The Trans-Pacific Partnership, a free-trade deal that sought to address Chinese economic expansion remains uncertain after the U.S withdrawal early last year. To make matters worse, President Trump’s threats of a trade-war with China promise to exacerbate U.S relations in the region, particularly because such a scenario could hurt American allies further down Chinese supply chains.
As China extends its sphere of influence further across Asia, most nations are too preoccupied with domestic political issues to slow it. While the stability of Western liberal democracies wanes, one only needs to look to the miraculous metamorphosis of Balochistan in southwest Pakistan to see what the future might hold instead.
Article by Fergus Opdebeeck Wilson