When Chinese President Xi Jinping came to Pakistan on an official visit in April 2015, he brought a $46 billion gift that could have significant benefits for Pakistan and a major impact on the whole region. And although there remain a number of unknowns on how this massive investment package will be implemented in the coming years, it is certain that it will pull Pakistan even deeper into Beijing’s geostrategic orbit. If all the projects associated with this deal are implemented, it will be a game-changer for the region as it equals all the foreign direct investment (FDI) inflows into Pakistan since 1970 combined and dwarfs the $7.5 billion US Kerry-Lugar aid package.
This $46 billion deal, known as the China-Pakistan Economic Corridor (CPEC), is essentially a package of major projects that fall into two domains: transportation and energy. On the transport side, there are about $12 billion in plans to build, among other things, a rail link connecting Gwadar to the western Chinese city of Kashgar. Other projects include widening the Karakoram Highway, itself previously built with Chinese help, upgrading Gwadar airport; building a 125-mile tunnel linking the two countries, and upgrading a number of existing highways, including the critical Karachi-Lahore section.
A number of energy projects — about $34 billion in total — are also on the drawing board. These include pipelines to transport oil and gas to Kashgar, the completion of the Iran-Pakistan gas pipeline, and a number of coal, wind, solar and hydro energy plants that would add some 10,000 megawatts to energy-starved Pakistan by 2018.
But the jewel in the crown for China is the development of Gwadar that would give Beijing a firm and reliable long-term beachhead in the Indian Ocean and close to the Persian Gulf, effectively making it a two-ocean power.
The CPEC deal grants the Chinese 40-year operation rights to the port. This is hugely significant because it will allow China to ship some of its oil coming from the Persian Gulf to that port and pump it through the pipelines to western China. Accordingly, with a transport route some 6,000 miles shorter, China will be able to save billions in transport costs and saved time. Indeed, Pakistan in general and Gwadar in particular will be playing a critical role in China’s joint plans for a Silk Road Economic Belt and a Maritime Silk Road linking China to Europe and beyond.
At the moment, Gwadar is being developed as a commercial port and not as a facility for the Chinese Navy, yet it could potentially be made into one in the future. Such a development would exponentially increase Sino-Indian maritime competition in the Indian Ocean.
In a move that will strengthen the defence of Gwadar, Pakistan has reportedly finalized a $6 billion deal with China for purchase of eight diesel-powered, conventionally – armed attack submarines. Pakistan’s possession of such submarines would seriously complicate any Indian attempt at blockading Karachi or Gwadar. This deal would also further entrench China as Pakistan’s principal arms provider.
China’s economic and military involvement in Pakistan began in the wake of the 1962 Sino-Indian war, when Pakistan felt that the US had been too quick to sell arms to India without getting any concessions from the Indians on the Kashmir issue. That is when Pakistan started to look elsewhere for international support, notably to China. But the bilateral Pakistan-China relationship really took off during the 1965 Indo-Pakistan war when the US terminated all military aid to Pakistan, while China openly sided with Pakistan and threatened military action against India. Although China’s support for Pakistan during the 1971 Indo-Pakistan war was lukewarm, the relationship nevertheless continued to grow in the 1970s, especially in the wake of India’s 1974 underground nuclear test. In the 1980s, this bilateral relationship deepened with significant Chinese financial support for the Pakistan. In the 1990s, the bilateral military relationship improved, especially in the field of nuclear weapons and missiles. Today, among other things, China and Pakistan jointly manufacture the JF-17 fighter jet, which will eventually become Pakistan Air Force’s main combat aircraft.
This steadily developing relationship has been intensified by the effective end of major Western, and in particular American, military presence in Afghanistan. Beijing has quickly seized this opportunity to bolster its long-term economic and strategic interests in Pakistan, unprecedentedly critical land bridge in the development of China’s Silk Road. Accordingly, Chinese leaders have been willing to invest substantially in the development of Pakistan’s decrepit infrastructure, particularly in its roads and energy sector.
Beijing knows that if the CPEC does not come to complete fruition, the bilateral relationship will nevertheless be more solid. And if the CPEC does meet all its targets, then China will have opened a cornucopia of advantages, including a link to its already very significant economic interests in neighbouring Afghanistan.
The election of President Ashraf Ghani in Afghanistan in September 2014 also influenced the timing of the Pakistan proposal. Since the departure of Hamid Karzai, Afghanistan has turned away from India and has instead embraced China (and Pakistan). Significantly, the first capital that Dr Ghani visited was Beijing, not Washington, let alone New Delhi. Under Karzai, Afghanistan was drawn more and more into India’s orbit. By the time he left office, Afghanistan had signed the Bilateral Security Agreement with New Delhi, Afghan military cadets were being trained in India, and India was about to provide weapons for the Afghan National Security Forces. To Karzai’s deep chagrin, Ghani put a stop to all these India-friendly activities and instead turned to Islamabad and Beijing.
This was an intelligent and pragmatic move that made much more sense geostrategically than looking to India for protection. By snuggling up to Islamabad, Kabul is putting pressure on Pakistan to crack down on the Taliban and their allies, who are far from a spent force in Afghanistan. Ghani knows that Beijing, too, will be putting pressure on Pakistani leaders.
The third objective of the CPEC is to counter the US-India rapprochement that has accelerated since Narendra Modi’s inauguration as prime minister of India. The process had begun under President Bush, who had stated in 2005 that the US wanted to help India become a great power. But, now it has become more insistent. During his visit to India in January 2015, President Obama finalized the July 2005 US-India nuclear deal and renewed the 10-year military cooperation agreement of 2005. US Defense Secretary Ashton Carter also signed a defence framework agreement during his visit to New Delhi in June 2015.
In addition to the enormous construction, logistical, bureaucratic and manpower challenges, the China-Pakistan Economic Corridor will require the two countries to address two significant security challenges. One is the activity of insurgents in Balochistan, the large southwestern province where Gwadar is located, and the other is the continued presence of the Taliban and their allies in Pakistan’s northwest. China will demand forceful action on both fronts.
Chinese workers and other non-Baloch have since long been the targets of Baloch insurgents opposed to large development projects. For example, three Chinese engineers were killed by a car bomb at Gwadar in May 2004. China shelved several Gwadar-related projects a few years back because of security concerns. Nevertheless, Beijing has decided to go ahead now because it believes the Pakistan’s security forces will be able to contain these insurgents. Confirming Islamabad’s determination to prevent future attacks, the Pakistani government has promised to provide 10,000 troops, including 5,000 trained specifically in counterterrorism, to protect Chinese workers. And although there will be a lot of pressure on Islamabad to ensure that new pipelines are safe from sabotage — now that they will be transporting oil and gas to China — this will not be an easy task.
The second security challenge — the semi-autonomous Federally Administered Tribal Areas (FATA) in the northwest along the border with Afghanistan — will be even more difficult to address because of the number of disparate actors present and their differing political agendas. There are three broad groups hiding in that frontier region: the Afghan Taliban, the Pakistani Taliban, and all the non-locals which include the Muslim Uighurs from China’s western Xinjiang province. The Chinese leaders have been putting pressure on Pakistan to ruthlessly pursue all these groups, in particular the Uighurs of Al-Qaeda–linked separatist East Turkestan Islamic Movement (ETIM).
Many of the ETIM fighters fled to Pakistan along with other Al-Qaeda and Taliban fighters following the ouster of the Taliban from power in Afghanistan in 2001. The Uighur operatives have managed to launch raids into Xinjiang province from those areas. This has deeply upset the Chinese leaders, and they have indicated their displeasure very publicly, especially after the deadly attack in the western city of Kashgar (future destination of those new pipelines) in July 2011. Beijing is reportedly interested in establishing bases either in FATA, which border Afghanistan in the northwest, or in FANA to the east, which border Xinjiang province. This straw in the wind has drawn the close attention of an already edgy India.
After a gruesome terror attack on Karachi’s international airport in June 2014, Islamabad ended its negotiations with the Pakistani Taliban, and armed forces launched a military operation in North Waziristan and later in the Khyber Agency in FATA. While the Pakistani military has successfully hunted down many of the terrorists, including the members of the ETIM, many of them have found refuge across the border in Afghanistan. Nevertheless, the year-long operation, which has brought the total number of Pakistani troops in FATA to some 200,000, has managed to degrade, disperse and disrupt the terrorists’ capabilities and networks.
Importantly, following the horrendous terrorist attack on APS Peshawar that killed 148 people, principally children, in December 2014, the military has repeatedly stated that it was targeting all terrorist groups. The military no longer differentiates between the “good” and the “bad” Taliban.
If the CPEC becomes a reality, it would be great news for Pakistan. It would certainly help the country deal with some of its major developmental issues, including upgrading some of its decrepit infrastructure and over coming its significant energy shortage.
Reportedly, Pakistan’s economy loses up to 6 percent of GDP because of power and infrastructure bottlenecks. That well over 1,000 people died in Karachi alone in June because of the lack of electricity to power air conditioners is an indication of how dire the energy situation is in Pakistan.
For CPEC to move forward, China will undoubtedly require that the Pakistani military continues to relentlessly hunt down the Taliban and all its ideological fellow travellers, including the ETIM, in the tribal areas. Pakistan should undoubtedly have its own reasons for wanting this as well, having bore the loss of some 50,000 precious lives and billions in lost revenue as a result of terror activities. The degrading of the Taliban et al. in the tribal areas would also hurt the Afghan Taliban’s ability to wreak havoc in Afghanistan, allowing the government to get on with the job of reconstruction after 30 years of war. If such a process does not occur, the Taliban will dominate Kabul and the ETIM would have a friendly rear base from which to potentially launch attacks into Xinjiang province. This is why China hosted exploratory peace talks between the Taliban and the Kabul government, with Pakistani army intelligence present, in Urumqi, the capital of Xinjiang, in May.
But if the new economic corridor succeeds there will be losers as well as winners. Although India is protesting about CPEC because some of the infrastructure traverses Azad Jammu & Kashmir, it’s not making too much of a fuss about Gwadar, not just yet. That could change quickly, however, if Gwadar becomes a full-fledged facility for the Chinese Navy.
Nor would the US see its national interests served by such an upgrade, which would effectively make Beijing a two-ocean power. The big question for Washington is how will this huge Chinese investment affect the Obama administration’s “rebalancing” of American assets to the Asia-Pacific. Initially, it will probably be minimal, given that Washington’s “pivot” is really focused on the western Pacific and the South China Sea rather than South Asia and the Indian Ocean. However, if Gwadar does develop into a Chinese naval facility in the future, Washington will recalibrate its response accordingly, as this would have a direct bearing on China’s ability to deploy naval assets in the Indian Ocean.
US relations with Pakistan today are good, and it is important they remain so in the future. Although the US has for all intents and purposes been displaced by China as Pakistan’s major patron, it is critical that Washington remains profoundly engaged with Islamabad. Pakistan is simply too important and too vital strategically to be shoved to the back or even to the side. Accordingly, Washington will need to be supportive of Islamabad’s counterterrorism efforts while at the same time monitoring closely China’s growing military and economic presence in Pakistan. Not to do so could otherwise lead to nasty surprises down the road — a road that will increasingly be paved with Chinese power, and money.
Courtesy: World Affairs Journal