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FOREWORD
The China-Pakistan Economic Corridor is the most important mega project in Pakistan
after the Indus Water Works initiated in the 1960s. There is no doubt that the
Economic Corridor will be hugely beneficial to the people of Pakistan and China. The
route that the Corridor will pass through in Pakistan had, however, become a subject
of controversy, fuelled largely by lack of information. In mid-April, the Hon. Chief
Minister Dr. Abdul Malik Baloch asked CMPRU for a report on the Corridor issue. The
Report helped frame Balochistan governments position on the subject and the May
28, 2915 APC on the subject arrived at a unanimously approved decision and set all
controversy at rest.
This publication is based on the said report and is aimed at facilitating an informed
discussion by the public at large and proceedings of the relevant parliamentary
committee and working groups.
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The Team
Dr. Kaiser Bengali
Dr. Ishaque Baloch
Badar-ud-din Khan
Mahmood Tareen
Mehnaz Hafeez
Saeed Yousuf
Printed at
The Times Press - Karachi
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INTRODUCTION
Plans for Pakistan-China economic cooperation in strategic spheres appears to have
developed in the mid-2000s, with the proposal to create an Economic Corridor from
Gwadar in Balochistan to Kashgar in the Western Chinese province of Sinkiang. Two
necessary conditions of the Corridor were and are development of the port at
Gwadar and creating surface transport connectivity between Gwadar and Kashgar.
They are absolutely necessary because without the port and without the transport
connectivity, no other economic activity with respect to the Corridor can be possible.
The main substance of the Corridor is the Gwadar port and the Gwadar-Kashgar
highway; the rest is icing on the cake.
One of the first overt manifestations of this strategic cooperation is the 84-slide
presentation in 2006 to the then leadership in Pakistan by the then Deputy Chairman of
the Planning Commission, Government of Pakistan.
proposed route of the Economic Corridor.
Commission logo, can be considered the first official identification of the route planned
for the Economic Corridor. The route on the map corresponds with the route now being
referred to by the federal government as the the Central Route1.
The Central Route is stipulated to pass through:
Gwadar-Turbat-Panjgur-Khuzdar2-Ratodero-Kashmore-Rajanpur-Dera Ghazi
Khan-Dera Ismail Khan-Bannu-Kohat-Peshawar-Hasanabdal-and onwards.
Gwadar to Khuzdar is also part of the proposed M-8 and an earlier version routes the motorway from
Turbat to Khuzdar via Hoshab and Awaran
Presentation to the
Hon. President and Hon. Prime Minister
ON
Khunjrab Pass
CHINA
Tarbela Dam
HUBS
CORRIDORS
JALALABAD
Peshawar
Torkham
KASHMIR
SEZ/SIZ/ EPZ
Islamabad
Rawalpindi
DISPUTED
TERRITORY
KOHAT
Mangla Dam
D.I. Khan
Chaman
Qila
Saifullah
Faisala
Shorkotbad
Quetta
Taftan
D.G.
Khan
Lakpass
Nok
Kundi
Lahore
Wagah
Okara
Multan Mian
Channu
Bahawalpur
IRAN
Rahim Yar
Khan
Sukkur
Ratodero
Rohri
Turbat
Hala
Hyderabad
Gwadar
Hub
Karachi
Kotri
ARABIAN SEA
Subsequently, more than one version of the Corridor route has emerged. A second
route, referred to by the federal government as the Eastern Route, is stipulated to
pass through:
Gwadar-Turbat-Panjgur-Khuzdar-Ratodero-Kashmore-Rajanpur-Dera
Ghazi Khan-Multan-Faisalabad-Pindi Bhatian-Rawalpindi-Hasanabdaland onwards.
Following the emergence of the Eastern Route in the media, demand for a third route,
referred to as the Western Route has been put forth, particularly from north-eastern
Balochistan. This route is proposed to pass through:
silence and subsequent contradictory statements. Three main strands can be identified
with regard to federal government attempt at explanations.
Initially, the position the federal government took was that there was no
change in the route, but failed to specify what the government presumed
was the original route. This position was maintained for most of the year
since the controversy broke.
Subsequently, in 2015, the federal government took the position that there
were three routes and that all the routes would be built. This explanation
cannot be accepted as plausible; as the resources to build all three routes
are not available and China would certainly not allocate resources to
pander to political disagreements in Pakistan.
One variant, among others, of the above explanation is that the three
routes would be built in stages and that the Central and Western routes
This
implies that the Corridor will be routed through areas of the country that
are already relatively developed.
However, if the reasoning for the Corridor route is to be based on the
availability of pre-existing roads and facilities, then the logical route
appears to be Karachi-Lahore-Rawalpindi-Hasanabdal-Khunjrab; with two
already developed ports (Karachi and Bin Qasim), two national highways
(N-5 and N-55) and several economic centres along the way.
In the
event, the entire rationale and justification for development of Gwadar port
disappears, as far as the China-Pakistan Economic Corridor is concerned.
Two possible conclusions emerge from the perusal of the Corridor case.
One, despite denials and statements to the contrary, the route has been
changed to pass through Central Punjab. And two, given that it is now
claimed that there are three routes, the priority has changed.
A new route is justified if it reduces the distance, subject to physical features, i.e.,
a water body, mountain, etc. In the present case, this principle would justify the
shortest possible route, with no weight accorded to the economics of the area in
between; and can be called a transit passageway.
However, if the objective is to boost economic activity along the route, shortest
possible distance is redefined as shortest feasible distance and can be called
an economic passageway
China-Pakistan Economic Corridor
Cost:
Cost is determined by:
Opportunity cost of land: Land acquisition costs are likely to be higher, if the land
to be acquired for the road is productive (for example, in terms of agricultural
produce) and there is likely to be loss of output from conversion of land to the
right of way. Conversely, costs are likely to be lower in the case of barren,
unproductive land, as loss of output from conversion to right of way is likely to be
minimal.
Dislocation costs (social and monetary) are likely to be higher in the former, as
productive land is invariably more populated and a greater number of households
and businesses would require to be compensated.
Nature of terrain: The cost of constructing the road is likely to be lower if the road
runs through plains and higher if there is extensive land leveling to be carried out
and numerous bridges, culverts, tunnels, etc., are to be constructed.
Pre-existence of part of the road: Overall costs are likely to be lower if the road
alignment includes a pre-existing road, as the costs for that section would be
saved. However, the width, quality, etc., of the pre-existing road matters. If the
road is not of the width and/or quality required to carry heavy traffic, additional
lanes will need to be built and the pre-existing sections will need to be re-laid.
Political economy:
A road creates connectivity and opens up markets for local produce and provides
access for education, medical care and socialization. As such, the route that a
road alignment takes confers benefits upon the people of the area to the
exclusion of those away from the alignment. Pulls and pressures with regard to
the alignment are, therefore, understandable.
156
5,829
13,754
Eastern
Route
264
10,322
30,928
Western
Route
98
2,933
7,430
The above comparative statistics are indicative of higher value of land and higher
population densities implying higher cost of land acquisition and higher dislocation
compensation cost with respect to the Eastern Route relative to the Western Route
and even the Central Route.
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COMPARATIVE ANALYSIS
A comparative analysis of the three routes with respect to the above precepts indicates
that:
Central Route
The Central Route is likely to be
longer than the Western Route, but
shorter than the Eastern Route.
Eastern Route
Western Route
The alignment is not likely to require The alignment will cross the
The alignment is not likely to
diversion on account of
Margalla Hills a national park
require diversion on account of
environmental or military reasons.
and a tunnel underneath is
environmental or military
being considered. Recourse to
reasons.
the courts on environmental
grounds is certain and likely to
delay the project.
Security costs will be higher on
account of insurgencies in
Balochistan and FATA.
The Ratodero-Hasanabdal
section is relatively secure; as
such, the alignment is likely to
entail lower security costs.
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If
selection of the Eastern Route is made on grounds that the Western and Central
routes carry security risks, then security considerations today will be traded for interprovincial discord and political instability in the future.
A combination of routes, traversing all the provinces of the country can lead to a
highway of national integration and stability.
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Postscript
The APC decision
The All Party Conference of May 28, 2015 unanimously decided to adopt a modified
Western Route that would pass through:
Gwadar-Turbat-Hoshab-Panjgur-Besima-Kalat-Quetta-Qila Saifullah-Zhob-Dera
Ismail Khan-Mianwali-Attock-Hasanabdal-and onwards
This route is superior to all other options in terms of opportunity cost of land and
dislocation compensation costs, as shown below.
Economics of alternative routes
Central
Route
Eastern
Route
Western
Route
Western2
Route*
156
264
98
76
5,829
10,322
2,938
1,838
13,754
30,928
7,430
1,485
underdeveloped areas of the country and is likely to prove critical to the development of
the area, particularly in terms of opening up to market centres, and generation of
employment opportunities.
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