📷 Image Credits: The Indian Express
The second phase of the China-Pakistan Economic Corridor (CPEC) is expected to be formally announced during the visit of Pakistan’s Prime Minister Shehbaz Sharif to China, his country’s biggest and most important ally. The $62-billion CPEC, launched in 2015 as part of President Xi Jinping’s Belt and Road Initiative (BRI), aims to expand China’s geopolitical influence through investments in infrastructure projects in around 100 countries.
The CPEC is set to facilitate the construction of power plants, road and rail networks, and the deep-sea port of Gwadar in Pakistan. For China, the strategic significance of this project lies in providing direct access to the Indian Ocean through highways in Pakistan-Occupied Kashmir and down the length of Pakistan. The first phase of CPEC focused on infrastructure, energy, and port development projects, but progress has been uneven.
Data from the CPEC website reveals that of the proposed power projects, some have been completed while others are still under construction or haven’t started. Similarly, transport-related projects are behind schedule, and only a few of the proposed Special Economic Zones have seen progress, with none being completed. This lag in progress can be attributed to Chinese concerns about corruption, red tape in Pakistan, political unrest, and security challenges in Balochistan province where Gwadar is located.
While CPEC was expected to bring economic development and investment to Pakistan, the ground reality seems different. Projects around Gwadar port are far from completion, and job creation targets have not been met. Local communities have not seen the promised economic benefits, leading to discontent and unrest in the region.
The debt burden on Pakistan from Chinese investments, including CPEC, has raised concerns about the country’s financial independence. China holds a significant portion of Pakistan’s external debt, leading to fears of Pakistan becoming a Chinese client state. The economic viability and overall impact of CPEC on Pakistan’s economy are being questioned, especially in terms of job creation and sustainable growth.
As Prime Minister Sharif visits China to discuss the second phase of CPEC, there are hopes for deeper cooperation in energy, agriculture, infrastructure, and cross-country rail projects. However, amidst challenges of debt sustainability, job creation, and economic productivity, the success of the CPEC’s second phase remains uncertain. The future of this ambitious project hangs in the balance, with both countries needing to address key issues to ensure its long-term success.