CPEC- THE SIGNIFICANCE
CPEC, over the years, has become the talk of the town for all the interesting reasons. Many hail this project as a ‘game-changer’, meanwhile, many questions linger over them about the nature of impact CPEC is destined to make. Many of us are generally well-aware of this mega-project but it does need to be succinctly explained before we get into the significance and magnitude of change CPEC aims to bring.
CPEC- a bird’s eye view
China-Pakistan Economic Corridor abbreviated as CPEC is doing the rounds in international politics. It is the project of Belt and Road initiative (BRI) that holds immense importance for the entire region specifically China, Pakistan, Afghanistan, India and the Central Asian Republic. In brief, the project aims to connect the Gwadar Port in southwestern Pakistan to China’s northwestern region of Xinjiang. The construction cost which was initiated on 22 May 2013 was originally estimated at $46 billion. The Dynamics of work include infrastructure for railways, roads, energy sector and air transportation system.
The significance of the project doesn’t appear to be obfuscating provided with the ‘at all costs’ narrative of Pakistan;
“CPEC is a manifestation of Pakistan-China friendship and the government will complete it at any cost and bring its fruit to every Pakistani.”- PM Imran Khan
Also, in the words of Gen. Bajwa;
“BRI with CPEC as its flagship is destined to succeed despite all odds and Pak Army shall ensure the security of CPEC at all costs.” — COAS Pakistan
CPEC and OBOR Initiative
The project of CPEC, being its largest and most advanced component, is a flagship part of China’s intuitive vision; OBOR that is ‘One Belt, One Road’ initiative. The segment ‘road’ itself projects the route towards advancement through the diaspora of a vast network of roads which will blur the lines of isolation between the concerned countries. Owing to the changing milieus of the international community of the states, CPEC can prove to be a breakthrough for the economic ballooning of the countries traversing the route of this web.
Time-Space Compression- Strategic Prosperity
The network of CPEC provides the shortest possible route that can assist trade and communication in nifty ways. The route successfully shortens the duration of 26 days to just 11 days. The Gawadar seaport can serve as a primary gateway for trade between China, the Middle East and Africa and thus can play a major role in the strategic prosperity of these regions.
Power Production
21690 MW power production has been agreed upon by the ministry of water and power and China’s National Energy Administration. The establishment of an energy planning expert group will work upon the successful strategy making. The plan also includes 16 power projects along with the construction of transmission lines. The principal focus will be on the power source and grid distribution. This would result in lower energy prices.
Economic Uplift
The 15 years package of massive contribution will reportedly boost Pakistan’s GDP by over 15%. Investment-to-GDP ratio will increase by 2.8% also with an increase in indirect investment. Not only Pakistan, but all the partners of the grand project will immensely benefit from the wonders it will bring. Areas like Africa, the Middle East and our immediate neighbour, Afghanistan will also miraculously benefit from this project. The rise in foreign inflows will cause a major market boost.
Upgradation of Transport System
CPEC has been playing an instrumental role in the overhaul of the existing transport system to ensure the compression of time and space so that market accessibility can be elevated. Furthermore, to facilitate transit trade and to lay advanced routes, the infrastructure of roads, railways and air transport is under prime concern and necessary steps are being taken.
Transit Trade
Transit trade will bring competitiveness as the increase in the number of partners will be followed by intense competition and thus will serve as the ‘invisible hand’ for trade. Secondly, diverse innovative ideas will take their form. This multi-billion-dollar infrastructure will also aid in the trade of Afghanistan and chances exist of it joining this project.
Technological Advancement
The information and technology sector has its fair share in the ongoing dynamics of advancement through CPEC. By deliberating on the scale of innovation CPEC is set to bring, it can be safely concluded that technological advancement will be the element of exceptionalism in the working of CPEC.
Exquisite Employment Opportunities
Apart from the other positive implications, CPEC will open up a vibrant market for geologists, geological engineers and environmentalists. Additionally, it is estimated that the project is all set to create 70,000 more job opportunities for Pakistan by 2030. According to Chinese Embassy documents, CPEC has already provided 75,00 direct job opportunities to Pakistan. Statistics claim that it is capable of creating even 1.2 million jobs in the near future.
“String of the Pearls” Strategy
CPEC has a strong link with China’s ‘String of Pearls’ strategy which comprises the sea lines of communication in Indo-Pacific. Gwadar, Pakistan is one of the ‘pearls’ in South Asia. The strategy is reportedly working on ‘sea-dominance’, huge assistance in trade. Thus, the maritime trade will be greatly aided through this approach.
There can be no denying the obvious fact that the politics of great power competition is resurgent around the globe and it is no different in Asia. The circumstantial evidence points towards the probability that the gravitating bond of togetherness between China and Pakistan following CPEC can be perceived as a greater threat by the rival Indian government India is the only country in the world with the demographic size and population comparable to China, therefore, it is also in China’s immediate interest to remain an upper hand in this case.
Uplift of Industrial Zones
Apart from the aforementioned welfare, CPEC holds an impressive industrial outlook and thus masses are hopeful to see the forecasted growth in the next few years. Various infrastructure projects would create a positive aura for the upstream industries and the downstream industries of oil and gas.
Raise in the Credit Outlook
It appears to me that the coming years would raise the credit outlook ratings of Pakistan and the connected regions and will boost the creditworthiness from struggling to stable to even positive. This will result in improving finances, lowering inflation and economic optimism.
Repayment of External Debt
Pakistan currently holds 109949 USD Million external debts. For a decade now, Pakistan has been in deep waters in terms of depth. CPEC is seen by the Pakistani government and a section of individuals as a new ray of hope that can extricate it from this major challenge. Fiscal consolidation along with various economic and industrial reforms under CPEC has the ability to bail the state out of this difficult spot.
Provincial Projects
Recently, some of the new provincial projects have been put in the already appraisable list of projects. These include Keti Bunder Sea Port Development Project, Chitral CPEC link road and others They are also working on the connectivity of the regional roads of Mirpur, Muzaffarabad, Mansehra and others with the CPEC route.
Gilgit-Baltistan- One of the Primary Beneficiaries
It can be ascertained from the framework of CPEC that it can certainly prove to be beneficial for Gilgit-Baltistan. This region hasn’t really been an integral part of the state of Pakistan especially since the Gilgit-Baltistan Empowerment and Self-Governance Order (2009) and thus lacks quite a proper structure to ensure its connectedness with the rest of the country. CPEC can grant socio-economic integration for Gilgit-Baltistan and thus can surmount this constraint. On the flip side, it appears that CPEC can boost the tourist activity to the region which is already hailed by many for its picturesque and awe-inspiring beauty. Not only will CPEC resolve the problem of transportation but will also serve as a critical factor for the elimination of poverty through the diversification of job opportunities. And this is only one of the many regions which will benefit from the mega-project of CPEC economically.
Role in Track 1 Diplomacy Between China and Pakistan
It is certain the project if executed in an efficacious way can prove to bring a win-win outcome for both Pakistan and China and would deeply intertwine the region. This will result in ballooning track 1 diplomacy in the Sino-Pak relationship and the ‘all-weather friendship’ which has already survived a huge testament of time through the thick and thin. This is not the first project that the two countries have come to the common grounds, rather they’ve been engaged in many difficult projects in the past and still managed to achieve success.
Conclusion
CPEC would undoubtedly bring incontestable welfare to the Afro-Asian region in particular and around the globe in general. It appears to the casual eye that this ingenious project will have a big hand in shaping the future of trade in Asia and across the world. I reckon that there will be a massive rise in job opportunities followed by an influx of innovative ideas. Despite the challenges this project is facing, both the partners, China and Pakistan should throw caution to the wind and continue to show revolutionary insight along with unyielding fortitude because the results will be jaw-dropping. Also, there are chances that cold foes of the region would probably embark on a new journey of good relations which can lead to regional peace and prosperity.