The China Pakistan Economic Corridor (CPEC), currently under construction at the cost of $46 billion, aims to develop Pakistani infrastructure and deepen economic and political relations between China and Pakistan. CPEC is favourable to Pakistan, but it also has significant economic and geopolitical advantages for China. The significance to China is clear from the fact that it is part of China’s 13th five-year development plan. CPEC will improve links between China and Pakistan, which share a tradition of friendly strategic relations, over a flexible canvas of mutual interest spanning six decades.
For the last 65 years, both countries have established close bilateral trade and economic cooperation. China is Pakistan’s leading trading partner for imports and exports. And CPEC would further strengthen the lucrative economic partnership between the two countries. The project would generate nearly 700,000 new jobs and add up to 2.5 per cent of Pakistan’s annual growth rate. The CPEC has undeniably economic and political significance for Pakistan and China. Pakistan has been called a game-changer because it will link China to markets in Central Asia and South Asia. China is currently some 13,000 km from the Arabian Sea, with a shipping time of around 45 days. CPEC will reduce this distance to just 2,500 km (80% reduction). Shipping time will be shortened to 10 days (a 78% reduction). The bulk of China’s trade is across the narrow sea lane of the Malacca Strait. Top security experts say that in the event of a potential Asian conflict, the US Navy might block the Malacca Strait, which would suffocate China’s trade route. In addition to offering an alternate route, CPEC will reduce the shipping time from China to Europe.
Much of the project will supply energy-thirsty Pakistani electricity, severely affected by regularly scheduled power cuts due to electricity cuts, mainly focused on the development of new coal-fired power plants. The plans envisage adding 10,400 megawatts of electricity at the cost of $15.5 billion by 2018. And after 2018 a further 6,600 megawatts, at an additional charge of $18.3 billion, will be added, doubling Pakistan’s’s current electricity output.
The completion of CPEC will not be an easy job, as it has attracted foreign conspirators from which it must be secured. The economic dividends of this project, by connecting all the economies of the world, would be so high that, once this project is fully operational, even our neighbour India will eventually join the club for more significant economic benefits.