CPEC : The Geo-strategic Counterpoise

Issues Details: 
Vol 10 Issue 5 Nov - Dec 2016
Page No.: 
16
Sub Title: 
An analysis of the CPEC and what it holds for both China and Pakistan
Author: 
R Chandrashekhar
Monday, December 5, 2016
Even though CPEC is between India's two neighbours, India's main concern is that it passes through POK, which is an integral part of India.
 
The China Pakistan Economic Corridor (CPEC), though not along a ‘traditional’ Silk Road and hence supplementary to China’s OBOR initiatives, is nevertheless cardinally important to both countries. The ‘corridor’ is in fact is an aggregation of several infrastructure projects over and above the central purpose to establish a 3000 km communication link between Gwadar on Pakistan’s Makaran coast to Kashgar in China’s Xinjiang province.  
 
Projects under the CPEC can be grouped as development and upgradation of Roads, upgradation of Pakistan’s railway network,  energy related projects, projects for development of Gwadar Port and Township and setting up of Industrial Parks and SEZs.
 
Funding
 
The initial estimated cost of execution of the proposed CPEC projects is approximately $46 billion and additional agreements, which are expected, would entail further outlays.  CPEC initiatives will largely be financed through loans. These loans would be made to Chinese companies, who will then invest in the projects as commercial ventures. 
 
Apprehensions have been raised regarding financing of CPEC projects being ‘shrouded in mystery’. A rather frank Article in the DAWN of 18 Nov 2015 argues that “many of the projects are to be financed by Chinese loans to the federal government that will impose significant and long-lasting costs on the state. For every dollar that is received as aid or a grant from the Chinese, there appear to be many, many more dollars that will have to be repaid over many years, indeed decades”.  It goes on to ask whether “In addition to the issue of overall costs to the state, and therefore the taxpayer, there is the question about how much of the spending on CPEC projects will accrue to Chinese companies and not to Pakistani talent”.  
 
Threats
 
The enormity of the security threats can be judged from the fact that the CPEC has faced more than a hundred security-related incidents since its launch in March 2014.  In such circumstances, it is a challenge for security agencies to provide protection to the 7,000 additional Chinese workers who are expected to join in the development work. Chinese experts acknowledge the challenges Beijing will face in implementing their agenda in Pakistan, but also describe CPEC as an important tool to encourage stability in Pakistan.  
 
To a great extent, therefore, the success of CPEC is contingent on Pakistan’s ability to ensure security and stability along the planned route.  On its part, Pakistan too is more than prepared to walk the extra mile in ensuring the security of CPEC Projects. The former General Raheel Sharif had even pledged “the armed forces are ready to pay any price to turn this long cherished dream into a reality.”
 
A serving Major General will head the special security force of over 12,000 personnel responsible for the security of the CPEC specifically to protect Chinese workers and technicians. This will be in addition to the 8000 security personnel already deployed to guard existing Chinese workers. 
 
India’s Apprehensions
 
India’s objection to the CPEC is rooted in principles as it passes through POK, an area that rightfully belongs to it.  Foreign Secretary S Jaishankar, in March 2016 stated in reference to the OBOR that India’s vision of Asian connectivity was that of a consultative process rather than that of “unilateral decisions” and that they should not “add to regional tensions”.   Former Ambassador M Bhadrakumar sees the CPEC being in India’s interest vis-a-vis Central Asia, and cautions that India might “lose heavily” were it to “remain opposed and isolated from the project”. 
 
China has however dismissed India’s concerns by terming CPEC to be a “commercial project” that does not “target any third party”.  As stated by a Chinese official spokesman is that ‘The ownership of the Kashmir region is an issue between India and Pakistan left over from history and should be resolved through dialogues and consultations between the two sides’.
 
A Game-changer for Pakistan
 
Foremost amongst the gains to Pakistan is that the CPEC takes Pakistan-China relations to the next level of a close strategic alliance with shared and security and economic interests which is why the Pakistani military has provided the project unambiguous backing. Most importantly, the CPEC ‘concretises’ its security and strategic alliance with China, a rising global power to the extent that the latter’s ‘energy jugular’ would pass through the territory of Pakistan. China’s interests thereby become abiding and compel it to support Pakistan’s security at all times, in its own interests.  
 
Pakistan has little strategic depth.  Gwadar as a strategic port being further away from India will increase this strategic depth considerably and enable Pakistan to monitor the Sea Lines of Communications (SLOCs) originating from the Straits of Hormuz. The presence in Pakistan of sizeable Chinese, naval assets would in effect bring about a ‘Pak-China nexus’ that would reduce the domination of the Persian Gulf and the Arabian Sea by the U.S 5th Naval Fleet besides constricting India’s aspiration to emerge as a Blue Water Navy.  
 
Pakistan militarily is today a ‘single port’ nation vulnerable during any future war with arch rival India. Gwadar Port being controlled by China would in itself be a deterrent for naval operations against Pakistan and once the lease expires, would eventually become a second naval base. 
 
For Pakistan, CPEC provides a ‘once in lifetime’ opportunity to overcome its serious economic challenges compounded by its limited resources and increasing population. It holds the promise of creating thousands of new jobs in construction, transport and trade sectors as also for the security of various projects along the corridor itself. Economic and industrial zones would be facilitated to come up along the Corridor route providing a boost to its economy. The CPEC will substantially establish and improve countrywide network of strategic highways, railway lines and telecommunication system and energy projects. Pakistan needs a modern communication system to boost its economy.  
 
Some Pakistani economists disagree as to whether their country can fully take advantage of the opportunity while others are uncertain as to whether the agreement will help Pakistan overcome a 50 percent trade imbalance with China.   As expressed by a prominent Pakistani economist, “A long highway passing just through vast land connecting one strategically important point with another, thousands of miles away, will not be an economic corridor”.  
 
Advantage China
 
The CPEC would serve China the following economic, geo-political and geo-strategic objectives:
 
Provide an entry to warm waters of Indian Ocean through Pakistan as opposed to utilizing long SLOCs on its maritime route connected its eastern part to the Middle East.      
 
Allows China to adopt a “Look West Policy” in its connect with Afghanistan, CIS States, Russia and beyond and leverage its geo-strategic bonds with them by facilitating their use of CPEC and Gwadar as a trade and economic link.
 
Enhance economic activity in the restive Xinjiang Province. 
 
Fortify and exponentially take forward its already long-standing all-weather relationship with Pakistan.
 
Provides China a ‘bird on perch’ position to fill the strategic void likely in Afghanistan once NATO troops are withdrawn. 
 
Is the CPEC really a win-win for both nations? In candid terms, perhaps not. Pakistan has allowed itself into a ‘subsidiary’ geo-strategic alliance with China in which it obtains not merely benefits of vast Chinese investments to upgrade its infrastructure and uplift its economy, it also acquires a vice-like grip on the future Chinese supply lines that would pass
through its territory.  China, on its part, can leverage Pakistan’s conduct and policies to sub serve its larger geostrategic interests, particularly in relation to India.   
 
Pakistan’s track-record as an abiding all-weather partner has however its own limitations. Akin to how the Saudis recently experienced, the Chinese too could well realise that their trusted friend is a snappy spaniel. That is perhaps when the ‘true worth’ geo-strategic worth of its investments in the CPEC would be realised.
 
Category: 
Geopolitics