What Does The Future Hold For CPEC?

What Does The Future Hold For CPEC?
China-Pakistan relations are strategic in nature and cooperative in character. China-Pakistan Economic Corridor (CPEC), launched in 2015, is a hallmark of bilateral strategic partnership. CPEC was planned to be competed in phases. In the first phase (2015-2020), in infrastructure development i.e., road and railways, and energy sector were prioritised for two reasons. One, Pakistan has a primordial, and not modern, infrastructure in particularly remote areas of south Punjab, interior Sindh and Baluchistan. Two, the country is energy-deficient for decades. Electricity and gas outages are still observed even in urban areas such as Lahore.

Theoretically, CPEC offers wide range economic opportunities for China, Pakistan/South Asia as well as Central and West Asia including the Middle East. Moreover, out of the six proposed economic corridors under the Belt and Road Initiative (BRI), CPEC so far is the only bilateral project, which further enhances its economic importance not only for China and Pakistan but also the broader region. Importantly, CPEC is in progress for the past eight years.

As far CPEC progress is concerned, let us analyse it empirically based on the official figures shared by the Ministry of Planning, Development & Special Initiatives, Government of Pakistan: see https://cpec.gov.pk/progress-update. Under the “energy” category, 14 projects have been completed of which two are completed early this year (2023). Two projects are under construction while five are under consideration. In the “infrastructure” category, six projects have been completed. Five such projects are under construction whereas 13 projects are under consideration. With respect to Gwadar development, four projects have already been completed while six are in progress and four are in pipeline.

Analytically, the above-mentioned energy, infrastructure and Gwadar development projects were placed under the first phase, and they were supposed to be completed within 2-3 years of the inception of CPEC. However, it seems the glass is half-full. Now, if we turn to the second phase projects initiated under the Long Term Plan (2017-2030), under the Special Economic Zones (SEZs) category, out of the proposed 9 SEZs, work on four is in progress; out of these 4, ground breaking ceremony of only two SEZs (Rashakai (KP) and Allama Iqbal SEZ (Punjab) have been done. Work has not been started on the remaining five SEZs. Under the “Social Sector Development (SSD)” category, five projects have been completed while 12 are under construction; and 10 are in pipeline. Again, work on SEZs and SSD has been slow. No new project completed in the past one year.

Plausibly, the reasons for non-completion of the said projects in time are multiple and vary from case to case. For example, road and railway a well as SEZs require land acquisition from the private sector, which is a complicated process. A provincial government offers financial incentives to private citizens to sale land; it cannot take land forcibly, thus, consuming time and delaying the work. A related reason is the lack of a composite governance model to streamline land-oriented projects. Provincial and federal government have different laws and procedures to, for example, acquire land for SEZ construction.

Another reason is lingering political instability in Pakistan, which has, to an extent, diverted governmental attention to trivial matters than long-term developmental projects. Besides, security challenges still persist though at a low scale. Pakistan is facing intermittent terrorist attacks on its security forces/state institutions, private citizens as well as Chinese nationals. The menace of terrorism has hampered development in the country since 9/11. Consequently, different terrorist organizations such as Al-Qaeda, Islamic State-Khorasan (ISIS-K) and Tehrik-i-Taliban Pakistan (TTP) have taken toll on innocent lives. To counter terrorism, Pakistan has raised CPEC force comprising civil and armed forces. However, the terrorists are employing different techniques, i.e., using women as facilitators and terrorists. Thus, it is not that easy to forestall such attempts. Within the South Asian region, LTTE used women for terrorism to pressure the Sri Lankan state. Nonetheless, Pakistan is committed to protect CPEC projects, its human resources particularly Chinese nationals who are working in different capacities in different parts of the country.

In terms of policy input to the highlighted problems, China and Pakistan need to stay alert and think innovatively to overcome security challenges. To its end, Pakistan needs to learn from the Sri Lankan experience to tackle the new style of terrorism where women are playing a lead role. Moreover, regional networks, which facilitate local elements, need to be eliminated through coordinated efforts between the law enforcement and the society especially in Balochistan and Karachi. On its part, China can help Pakistan with state-of-the-art military technology for reconnaissance purposes. In addition, inclusive growth model should be followed in the areas adjacent to CPEC. Local populations should be involved in the economic activities alongside the corridor. Vocational training institutions should be established, on a priority basis, to equip the people with the desired skills. Politically, Pakistan ought to ensure political stability for sustained development of CPEC projects.

Regionally, Pakistan should get Shanghai Cooperation Organization (SCO) and the Central Asian states and Afghanistan on board to become stakeholders in multilateral development through China-Pakistan Economic Corridor. Similarly, the South Asian Association for Regional Cooperation (SAARC), of which China is a regular participant, can be invoked to realize regional peace and prosperity by offering economic incentives to the regional players such as Afghanistan. Such regional and global diplomatic forums can prove effective to even neutralize the regional opposition to CPEC/BRI emanating mostly from India.

Finally, Beijing and Islamabad ought to assess any damage done to CPEC projects, i.e., roads, on account of 2022 floods in KP, Sindh and Balochistan. More than 35 million people were affected of which 1739 lost their lives. In addition, they lost their sources of livelihood and shelter. Due to climate crisis, Pakistan is vulnerable to environmental catastrophes. China needs to register its presence in these flood-affected areas to not only provide relief to the flood affectees but also develop a soft image within the local populations of whom many live in the vicinity of CPEC projects. Indeed, it is pertinent for China and Pakistan to invest in water management such as small dams for the safety of CPEC infrastructure.

The writer has a PhD in civil-military relations from Heidelberg University. He is DAAD, FDDI and Fulbright fellow and teaches at the Lahore School of Economics. He can be reached on Twitter @ejazbhatty