Friday, September 18, 2020

Op-ed: Impacts of CPEC on Asian region and beyond

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The comprehensive development deal between Pakistan and China (CPEC) not only creates strategic and economic connectivity between these two countries but also has the potential of integrating other regional and extra-regional countries, and could play a key role in improving the economic and security environment.

The project is being considered a vital component in realizing the prospective of regional connectivity and improving trade with regions like Central Asia, Africa, the Middle-East, and Europe.

CPEC to result in development of Western China

From a strategic perspective, the CPEC will bring many benefits to China and one of them is the development of the western region. The provinces and cities along the coast of China in East China, South China, and Yellow seas are extensively populated and developed than the Western Cities and Provinces especially the Autonomous Region of Xinjiang including Qinghai Province and very strategic the Tibetan plateau.

There is inequality of income, the difference in the standard of living, and a gap in economic opportunities among these Chinese regions along with some ethnic conflicts in Tibet and Xinjiang which directing Chinese policymakers to developed western regions through trade and investment.

Read More: Propaganda about CPEC halt untrue: Asim Bajwa

One of the rationales behind the PRC’s desire for the connectivity of Pakistan with Xinjiang is to attract public and private investment in its western region. When CPEC will be fully operational, it will initiate more economic activities in the Xinjiang province and will help China in the execution of its Western Development Strategy which is very important for the political stability of China.

Actually, because of the physical proximity of Xinjiang with Pakistan, this less-developed part of China will connect to the warm waters of the Arabian Sea. Ultimately, as China’s eastern and southern coastal areas prospered and developed due to Yellow River and port cities like Shanghai and Shenzhen western China, according to the plans, will going to be developed with the help of port cities like Karachi and Gwadar.

Circumvent Afghanistan

Peace in Afghanistan is important for all the regional countries and the recent developments of Afghanistan related to troops’ withdrawal and political settlement are positive signs for the prosperous future of the country.

For a landlocked country, access to port cities and the sea is very crucial for development and prosperity. Western alignment of CPEC’s transport infrastructure will help connect Pakistan with Afghanistan which leads the latter country access to the port cities and warm water of the Arabian sea.

But the security situation in Afghanistan is not fully normalized so far,  as evidence in one very strategic piece of information that the official U.S and NATO forces have started their withdrawal but will the CIA also leave Afghanistan and abandon its covert support to the militant groups used to weaken the Taliban?

Read More: In outgoing interview, Chinese envoy talks India, CPEC, and the West

There is a possibility that the CIA keeps exploiting Afghan Opium to funds their covert operations in Afghanistan to fight ‘so-called’ Al-Qaeda and Islamic State Militants along with supporting many small militants against the Taliban. So, there is a security vulnerability and also the landscape and terrain of Afghanistan are very complex and lacking transport infrastructure as well.

A road link has already been upgraded to Kyrgyzstan from Kashgar under the BRI and a railway line between China and Kazakhstan has been completed by China. There is a plan to built a railway from Uzbekistan to Kyrgyzstan with onwards connections to China and Pakistan. So, these developments will help give the Central Asian Republic access to the deep-water seaport of Gwadar by completely bypassing Afghanistan.

Alternate Route to the South China Sea

China is the largest trading nation and importer of energy in the world. Approximately, 60% of its energy comes from the Middle-Eastern countries, and 80% of that import passes through the Indian Ocean then to the Strate of Malacca and all along to its port cities present at South China, East China, and the Yellow Seas.

The countries that exist in this region are India, Thailand, Indonesia, Malaysia, Singapore, Brunei, Philipines, Vietnam, Hongkong, South Korea, and Taiwan — most of these countries are U.S allies.

The security of the sea lanes of communication and the mineral resources present in the area has prompted China to claim areas of this region on the bases of historical background along with the U.S-led push for the freedom of navigation, make the area highly vulnerable to military conflicts which can halt the trade and oil import of energy-hungry China.

Read More: Pentagon says China pursuing CPEC for strategic objectives, PLA superior to US military

CPEC: Analysing alternate routes to this region, in case of conflict

First, because of climate change and global warming, the Arctic Ocean’s ice caps are melting. Though, there is some sort of partnership between Russia and China to build the Northern Sea Route despite their converging interests but, as every important trade routes are not free from vulnerable choke points so does this new will be in the shape of “Bering Strait” — between Russia and Alaska. And, further, this endeavor will take time to become an alternate route to the traditional sea route for major trades

Second, the Bangladesh-China-India-Myanmar Corridor (BCIM) could be evolved as a replacement. In 2015, China recommended to include the passageway as part of its BRI. But the BRI was revolted by India. In 2019, the Corridor was not included in a list of 35 corridors and in a joint statement issued by state leaders attending the 2nd Belt and Road Forum, indicating that BCIM had been declined from the BRI — at least for the time being.

Third, routes like Sunda, Lombok, and Makassar Straits have been proven dissatisfactory as the Sunda Strait is trivial and the Lombok and Makassar Straits are longer routes that could incur a huge monetary burden with shipping costs estimated around $220 billion per year.

Read More: CPEC breathes new life into Pakistan’s Gilgit Baltistan

Finally, Pakistan’s Gwadar Port could become a highly likely alternative that can handle the maximum part of the energy imports from Middle-Eastern countries as compared to the above-mentioned routes.

The traditional sea route of China’s energy import is roughly 12,000 km long. And the potential land route from the Gwadar port to the southern coast of China is around 6,500 km: Gwadar Port to Kashgar 3,000 km and Kashgar to the Southern coast is around 3,500 km.

Though there are certain problems to this route as well especially related to the cost. In general, per barrel oil transport through sea route is around $2 while the land route costs roughly from $12 to $15 per barrel of the same distance. And there is also concern about the landscape and terrain of Karakoram Highway.

But the projects of CPEC in Gilgit-Baltistan including roads and railways could develop Karakoram Highway to the extent to handle the required trade one day. Further, at present, transportation of energy through the Strait of Malacca takes around 45 days, which could be easily reduced to less than 10 days if done via Gwadar port as it provides the best possible land and sea routes for this purpose from the available options.

Conclusion

As we have learned from history that you can change your diplomatic, economic, and military partners with the changing realities of the world but you can not change borders so do your neighbors. The development and prosperity of any country could not be achieved with peaceful and friendly relations with its neighbors. Pakistan and China have learned from the past — I guess. But, unfortunately, there is an actor in this very region who is repeating the old mistakes of history by taking the wrong path that state actor will bear the cost one day.

Anyhow, the economic and diplomatic relations with other major powers: U.S, U.K, EU, Japan, etc are important for Pakistan and there is a need to balance it’s relations to the eastern and western powers but the natural alliance of Pakistan will be with China and other regional countries like Russia, Central Asian Republics, Afghanistan, Iran, and Turkey.

Further, to reap the fruits of this mega-deal, Pakistan needs to organize its own economy with new reforms and regulations in industrial and trade sectors so that the corridor will be utilized in the best possible way.

Shehz Zulkifal has studied Business, Economics, Banking, and Finance in his last degree. He has worked in the Asset Management Company as an Investment Associate. He recently completed an internship at the Center for Global and Strategic Studies, Islamabad. The views expressed in this article are the authors own and do not necessarily reflect the editorial policy of Global Village Space.

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