CHINA PAKISTAN ENERGY CORRIDOR (CPEC)

OUTLINE
1. Introduction
2. The concept of One Belt and One Road (OBOR)
3. Development of Gwadar
4. Projects
5. Potential threats and challenges
a) Internal
b) External
6. Benefits for Pakistan
7. Counter Indian influence
8. Economic gains from this project
9. CPEC is a flagship project of One Belt and One Road
10. CPEC is a game changer
11. Advantages and disadvantages
12. suggestions
13. Conclusion
Introduction
The CPEC is a 3,000-kilometre network of roads, railways and pipelines to transport oil and gas from
Gwadar Port to Kashgar city, northwestern China's Xinjiang Uygur autonomous region, China Daily
reports. China and Pakistan have agreed to build One Belt One Road project more commonly known as
China-Pakistan Economic Corridor is expected to bring about both peace and prosperity in South Asia.
This corridor will link between Kashgar in north-western China to Pakistan's Gwadar port on the Arabian
Sea near the border with Iran via roads, railways and pipelines. There are many internal and external
challenges for Pakistan government to implement this multi-dollars project. However, it is a game
changer project which will transforn1 the fate of Pakistan and will help Pakistan modernize. It will
improve the economy and trade, enhance regional connectivity, overcome energy crises, develop
infrastructure and establish people to people contacts in both the countries.
Proposed by Chinese Premier Li Keqiang during his visit to Pakistan in May 2013, the CPEC will act as a
bridge for the new Maritime Silk Route that envisages linking three billion people in Asia, Africa and
Europe.

The concept of One Belt and One Road (OBOR)

The One Belt One Road (OBOR), the brainchild of Chinese President Xi Jinping, is an ambitious project
that focuses on improving connectivity and cooperation among multiple countries spread across the
continents of Asia, Africa and Europe. Dubbed as the “Project of the Century” by the Chinese authorities,
OBOR spans about 78 countries.
Initially announced in the year 2013 with a purpose of restoring the ancient Silk Route that connected
Asia and Europe, the project's scope has been expanded over the years to include new territories and
development initiatives. Also called as the Belt and Road Initiative (BRI), the project involves building a
big network of roadways, railways, maritime ports, power grids, oil and gas pipelines and associated
infrastructure projects.
The project covers two parts. First is called the “Silk Road Economic Belt” which is primarily land-based
and is expected to connect China with Central Asia, Eastern Europe and Western Europe. The second is
called the “21st Century Maritime Silk Road” which is sea-based and is expected to will China’s southern
coast to the Mediterranean, Africa, South-East Asia and Central Asia. The names are confusing as the
‘Belt’ is actually a network of roads, and the ‘Road’ is actually a sea route
They contain following six economic corridors: New Eurasian Land Bridge that connects Western China
to Western Russia, China – Mongolia – Russia Corridor that connects North China to Eastern Russia via
Mongolia, China – Central Asia – West Asia Corridor that connects Western China to Turkey via Central
and West Asia, China – Indochina Peninsula Corridor that connects Southern China to Singapore via
Indo-China, China – Pakistan Corridor that connects South Western China through Pakistan to Arabia sea
routes, and Bangladesh – China – India – Myanmar Corridor that connects Southern China to India via
Bangladesh and Myanmar. Additionally, the maritime Silk Road connects coastal China to the
Mediterranean via Singapore-Malaysia, the Indian Ocean, the Arabian Sea and the Strait of Hormuz.
OBOR is of prime significance to China as it aims to boost its domestic growth, and is also a part of the
country’s strategy for economic diplomacy. By connecting the less developed border regions like
Xinjiang with neighboring nations, China expects to bump up economic activity. OBOR is expected to
open up and create new markets for Chinese goods, and will also enable the manufacturing powerhouse to
gain control of cost-effective routes to easily export materials. Any excess capacity in terms of production
can be channelized effectively to regions along OBOR routes. China has announced investments over $1
trillion in the various infrastructure projects, and is funding them by offering low-cost loans to the
participating countries.

Development of Gwadar

Gawadar a deep sea warm water port located about 460 kilo meters west of Karachi at the mouth of Strait
of Hormuz,whereas the kingdom of Oman is situated at least 380 km northeast and Iran is situated 75 km
east of Gawadar. ThePort of Gawadar has significant geo strategic and geo economic importance for Chin
a. It is located at the choke pointof world’s energy supply route. Gawadar port will provide shortest route
to China for its energy supplies and goodsfrom Persian Gulf to Africa and from China to rest of the globe.
Gawadar Port will connect Chinese city of Kashiger inMuslim province Xinjiang. China’s eastern seaboa
rd is 3500 km away from the city of kashiger in western China,whereas the distance of Gawadar port fro
m city of Kashiger is only 1500 kilometers. Gawadar port will reduce the timeand cost for Chinese oil sup
plies and public goods. Pakistan officially announced the construction of phase I of Gawadar Port in 2001
. Three multipurpose berths wereconstructed along with port infrastructure and equipment’s for handling
cargo. China warmly welcomes of Pakistaniinitiative and provides $198 million out of $248 million for th
e construction of first phase
It will also provide an opportunity to China to build a naval base on Gwadar port that will increase
influence of China in the region and also counter US influence in the Asia-Pacific region. The CBS News
quoted some Western diplomats on Pakistan-China partnership. According to them, China's increasing
economic engagement with Pakistan should be seen in the context of Beijing's "efforts to counter the US
efforts to deepen alliances around the Asia-Pacific region."

Projects

According to the assessment of the Corridor, the plan is involved in laying the foundation for regional
cooperation, improving economic growth, offering trade diversifications, investing in transportation,
mining and energy sectors and creating political flexibility. It is a vision with world-. changing
implications, an unfolding plan that would weave much of Asia, Europe, Africa, Oceania and the Middle
East much more closely together through a patchwork of diplomacy, new infrastructure and free trade
zones.

1. Roadway projects
The CPEC project envisages major upgrades and overhauls to Pakistan's transportation infrastructure.
Under the CPEC project, China has announced financing for $10.63 billion worth of transportation
infrastructure so far; $6.1 billion have been allocated for constructing "Early Harvest" roadway projects at
an interest rate of 1.6 percent.The remainder of funds will be allocated when the Pakistani government
awards contracts for construction of road segments which are still in the planning phase. Three corridors
have been identified for cargo transport: the Eastern Alignment through the heavily populated provinces
of Sindh and Punjab where most industries are located, the Western Alignment through the less developed
and more sparsely populated provinces of Khyber Pakhtunkhwa and Balochistan, and the future Central
Alignment which will pass through Khyber Pakhtunkhwa, Punjab, and Balochistan.
2. Railway projects
The CPEC project emphasizes major upgrades to Pakistan's ageing railway system, including rebuilding
of the entire Main Line 1 railway between Karachi and Peshawar by 2020; this single railway currently
handles 70% of Pakistan Railways traffic. In addition to the Main Line 1 railway, upgrades and
expansions are slated for the Main Line 2 railway, Main Line 3 railway. The CPEC plan also calls for
completion of a rail link over the 4,693-meter high Khunjerab Pass. The railway will provide direct access
for Chinese and East Asian goods to Pakistani seaports at Karachi and Gwadar by 2030
3. Energy sector projects
Pakistan's current energy generating capacity is 24,830 MW. Energy generation will be a major focus of
the CPEC project, with approximately $33 billion expected to be invested in this sector. An estimated
10,400 MW of electricity are slated for generation by March 2018 as part of CPEC's "Early Harvest"
projects.
a) Renewable-energy
In March 2018, Pakistan announced that hydropower projects would be prioritized following the
completion of under-construction power plants.Pakistan aims to produce 25% of its electricity
requirements by renewable energy resources by 2030. China's Zonergy company will complete
construction on the world's largest solar power plant – the 6,500 acre Quaid-e-Azam Solar Park near the
city of Bahawalpur with an estimated capacity of 1000 MW is expected to be completed in December
2016.The first phase of the project has been completed by Xinjiang SunOasis, and has a generating
capacity of 100 MW. The remaining 900 MW capacity will be installed by Zonergy under CPEC.
b) Coal
Despite several renewable energy projects, the bulk of new energy generation capacity under CPEC will
be coal-based plants, with $5.8 billion worth of coal power projects expected to be completed by early
2019 as part of the CPEC's "Early Harvest" projects.
c) Liquified natural gas
Liquefied natural gas power LNG projects are also considered vital to CPEC. The Chinese government
has announced its intention to build a $2.5 billion 711 kilometre gas pipeline from Gwadar
to Nawabshah in province as part of CPEC.The pipeline is designed to be a part of the 2,775 kilometre
long Iran–Pakistan gas pipeline, with the 80 kilometre portion between Gwadar and the Iranian border to
be connected when sanctions against Tehran are eased; Iran has already completed a 900 kilometre long
portion of the pipeline on its side of the border
4. Agriculture
CPEC includes provisions for cooperation in management of water resources, livestock, and other fields
of agriculture. Under the plan, agricultural information project, storage and distribution of agricultural
equipment and construction project, agricultural mechanisation, demonstration and machinery leasing
project and fertiliser production project for producing 800,000 tons of fertiliser and 100,000 tons of bio-
organic fertiliser will be implemented.
5. Science and technology
In February 2016, the two countries agreed to establish the "Pak-China Science, Technology, Commerce
and Logistic Park" near Islamabad at an estimated cost of $1.5 billion. The park will be situated on 500
hectares, which will be provided by Pakistan to China's Xinjiang Production and Construction Corps,
with all investments expected to come from the Chinese side over the course of ten years.
In May 2016, construction began on the $44 million 820 kilometer long Pakistan-China Fiber Optic
Project, an optical fiber cable that will enhance telecommunication in the Gilgit-Baltistan region, while
offering Pakistan a fifth route by which to transmit telecommunication traffic.
Potential threats and challenges

Pakistan faces several challenges in the implementation of the China-Pakistan Economic Corridor
(CPEC) project. These challenges can be identified as external and internal. The Vice Director General of
Policy Research Office at the International Department of the Central Committee Communist Party of
China, Dr. Luan Jianzhang is of the view that political unrest, security situation and administrative issues
are some of the greatest challenges in the way of successful completion of the corridor.

The construction of the corridor has been defined by many as a strategic moment such that Pakistan has
assumed the position of economic pivot for the whole region. This paradigm shift in circumstances is a
cause of great worry for the enemies of Pakistan both within and outside. India, Israel and the US are
unhappy. For India, CPEC is a thorn in its paw. They have put their heads together to work out new
strategies to block the project forward march. RAW has opened a special office in Delhi and has been
allotted $300 million to disrupt CPEC. Already one can notice sudden upsurge in the acts of terror in the
three restive regions and activation of certain NGOs and think tanks all trying to air misgivings and create
fear psychosis.

In Pakistan, some political parties like ANP, Baloch nationalists, PkMAP raised serious objections to the
CPEC project. Even PT! and JUI (F) showed inclinations to climb the bandwagon of anti-CPEC forces.
Objections were being raised despite assurances by the government that this project will provide equal
opportunities to all the provinces.

Security concerns have been the most critical challenge to the CPEC and both Pakistan and China have
been trying to meet these. An arc of militancy stretches from Xinjiang to Gwadar consisting of groups
like the East Turkestan Islamic Movement (ETIM), Tehreek-e-Taliban Pakistan (TTP), Lashkar-e-Jhangvi
(LeJ), Daesh (ISIS), Balochistan Liberation Army (BLA), Balochistan Liberation Front (BLF) and the
militant wings of some political parties. Most of these groups may not have an enn1ity with China itself
but rather intend to attacks the Chinese interests like the CPEC as a means to deal with the Pakistani state.

Benefits for Pakistan

Pakistan is facing serious energy short falls from last decade. With the completion of energy
projects under the banner of CPEC more than 10,800 Megawatts electricity power will be added
to the national grid.Whereas roads and railways are the key component in the economic
development of a country. Pakistan is facing serious threats of terrorism and extremism from last
decade. Pakistan put all its energies to combat terrorism. But with the lack of funds Pakistan was
unable to build new roads and railway networks. Under the CPEC framework roads, railways, oil
and gas pipe lines will be built across the country. Even small cities and villages will connect
with the main lines of logistics networks. These links will bring the developments in the
connectivity of roads and railways infrastructure. Peoples will get benefits from new networks
and will be able to bring their goods in the markets of major cities across the country At present
time industry in Pakistan is not producing enough goods for the consumption of country’s
demand. Pakistan and China proposed 29 industrial parks and 21 mineral zones across the
country. After the construction of industrial parks and mineral zones Pakistan will be able to
produce the goods for its public demand. Young and educated peoples will get more benefits
through getting jobs in new industrial parks and mineral zones. .The CPEC and industrial park
swill bring up the peoples from the poverty line and will bring a new look to country’s economic
market. Pakistan will be able to export more public goods and related material in international
markets. Through the CPEC bilateral trade between Pakistan and China will exceeds. Thus the
China-Pakistan Economic Corridor will be a fate changer for the government and peoples of
Pakistan.

Counter Indian influence

Gwadar is the tail of the Silk belt, which will connect at Kashgar through different communication
networks. The security of the whole corridor and Gwadar is a real concern for China. After the military
operation in different parts of Pakistan, the terrorist infrastructure still exists inside and outside of the
borders which will continue to pose a threat. The support of American CIA, Israeli

Mossad and Indian RAW has continuously been assisting the militant groups and sub-nationalists in all
the provinces to conduct subversive acts - and using terrorist elements in the whole country to threaten the
Pak-Chinese plans of developing the CPEC. In the past few years, they kidnapped and killed many
Chinese nationals in Pakistan despite Pakistan's efforts to provide best possible security. The army has
announced the creation of I 0,000 man special force for protecting the development projects. The new
force, named the Special Security Division, will comprise nine army battalion and six wings of
paramilitary forces, the Rangers and the Frontier Corps.

The dice of connectivity loaded by China has left India confused and bewildered. India is also concerned
about China's huge investment in Pakistan, particularly its recent decision to fund for China-Pakistan
Economic Corridor. China is also helping Pakistan in producing plutonium at the Chinese built Kyushu
reactor and will also sell eight submarines worth $5 billion, which will give a quantum jump to Pak
Navy's sea capability.
Economic gains from this project

With investments in road, railways and ports, the $60 billion China Pakistan Economic Corridor (CPEC)
offers enormous potential for Pakistan to boost its economy, reduce poverty, spread benefits widely and
help those likely to be affected by the new trade route

The report, entitled “The Web of Transport Corridors in South Asia”, published by the Asian
Development Bank, the United Kingdom’s Department for International Development, the Japan
International Cooperation Agency, and the World Bank, discusses several economic corridors including
CPEC

“The largest economic gains from investing in transport corridors may arise from urbanization and job
creation around this new infrastructure, rather than from many more vehicles using it”, said one of the
report’s authors, World Bank economist Martin Melecky, who added: “not all corridor investments are
equally successful in creating large economic surpluses that spread fairly throughout society.”

The ability of large-scale transport investments to generate wider economic benefits depends on the
population density in the areas they cross. Their capacity to spur structural transformation along the way
depends on complementary factors around the transport corridors, such as the skills of the local
population or restrictions on local land use. The new transport infrastructure must come with the means
for people to take advantage of the improved connectivity right from the start.

CPEC is a flagship project of One Belt and One Road

Flagship means to be in leading position in a venture. As far as CPEC is concerned, it is truly the flagship
of OBOR owing to the following reasons:

 CPEC turns out to be one of the most important links in the OBOR network that will allow China to
reach the markets of Africa, Middle East and Europe
 CPEC stands out to be the first such project that has been materialized in no time and it is almost in
the starting phase of its practice
 Providing the shortest link between three continents, allowing massive trade transit and connecting
the Chinese dots of OBOR; CPEC remains a flagship of the One Belt One Road vision.
Cpec is a game changer
Pakistan has great geopolitical importance in the region. The most vociferous depiction of this reality
came in shape of China Pakistan Economic Corridor. The corridor is a $46 billion project which will
provide the shortest trade routes for the Chinese goods to the markets of Gulf and African regions via
Gwadar port of Pakistan. The project is being seen as game changer of region amid challenges faced
by it.
CPEC brings immense economic opportunities for Pakistan. The country has for long faced economic
crisis. In the wake of this project Pakistan will seek revenue from port rents, trade tariffs and chance
to establish its own trade links with the Gulf States.
It will bring fortune to the people of the regions who will host its trade routes. This will also lead to
establishment of industry thus creating more jobs. An important prospect of CPEC is seen in the
power-projects it is bringing for Pakistan. Under the deal signed, China will install over 15 power
 plants in Pakistan. They will double the energy production by 2020 which is going to end the energy
crisis in country.
CPEC brings the prospect of uniting the region economically. China can lead an economic bloc of
Asia. Iran will also find this project favourable once this project gets completed. The CPEC has been
proving an eye sore for the enemies of Pakistan, thus giving way to a number of challenges, including
engineered militancy in Balochistan to demoralise the investors, the Indian interference in the
construction and development of project and global strategic competition between US and China.
CPEC is seen a Game Changer in the region as it will bring economic unity in Asia particularly
among the countries of South Asia, Middle East and adjacent states of Africa, it can bring stability in
the region if countries are positively engaged in trade, CPEC can turn Gwadar port into an
international trading point bringing fortune to Pakistan and regional balance, which for long has been
US-dominated, will gradually begin to show a shift in alliances. Dealing with the challenged ahead,
CPEC can be constructed to exploit the maximum of potential it carries. CPEC is a Game Changer
economically as well as strategically.

Pros

1. Pakistani Labor will get jobs.

2. Pakistani products will be exported to China.
3. CPEC is not only a road but the combinations of the road, rail and economic zones, this will
helps Pakistani Entrepreneurs.
4. Pakistan will no longer depend on West.
5. Pakistani Products will also be easily transported to markets that have no access, right now.
6. Pakistani students will get an easy access to China education system.
7. It will help Pakistan in dealing with its energy problems/projects coal-fired, solar power plants
in Karachi, Bahawalpur, Thatta, Narran, Sahiwal etc.
8. Gwadar port constructed under CPEC is a transit hub for the central Asian republics.

Cons

1. China will find an access to interlock countries this may increase the numbers of Chinese
Products, this will depressed Pakistani Businesses.
2. China national language is Chinese, Pakistan National language is Urdu, and this will create a
huge communication gap.
3. Pakistani market is not capable to cope with the increasing demand of the raw materials
needed for this project.
 4. A number of technical people in Pakistan are too low, so China has to use his own manpower
(As usual) to cope with increasing demand.

Suggestion:
1. Security measures
2. Border management
3. Political Stability
4. Regional Cooperation

For the smooth operationalization of CPEC, peace is imperative for the country. In spite of the
improved security, it remains a challenge for the long term. Terrorists still manage to carry out
attacks like the recent violence in Queeta. For achieving that objective, comprehensive National
Action Plan (NAP) was formulated to wipe out extremism and terrorism. It helped to tackle the
menace of terrorism. Today, there is a tremendous decrease in terrorism related incidents.
However, except few points of NAP, others remain unimplemented. There has always been a gap
between devising and implementation of strategy in our country. It is need of hour to review the
NAP and implement all of its 20 points.

Porous border with Afghanistan has always been a trouble for Pakistan. Terrorists after training
are launched through that border. Afghanistan does not recognize the Durand line region so the
western border remains unsealed. People move across the border even without visa. Effective
steps should be taken to manage border so that terrorists’ infiltration could be stopped inside the
country. Now, Pakistan has raised 29 wings in paramilitary forces for border security. This is the
first time border management has been considered seriously along with a workable plan.

In Pakistan, political stability remains an internal challenge. Political stability is important for the
success of CPEC. Because it is political decision-making which impacts the behavior of
institutions. For achieving political stability, the three pillars of state legislature, judiciary and
executive should work in harmony. Media should also play its vital role. Furthermore, all the
institutions should work within their domains. Political interference in institutional functioning
should be discouraged for internal stability.

Regional cooperation should be promoted. Relations with neighboring countries in particular

while with other countries like Russia in general should be improved keeping in view the
changing international political dynamics. Their participation and investment in CPEC should be
encouraged. That is also in the interests of the country. As maxim goes, “we cannot choose
neighbors, but we choose friends.” The geography cannot be altered. Thus, there is only option
that is the promotion of peaceful coexistence. Pakistan has to forge regional cooperation for
CPEC’s long term success. In order to achieve that objective, it is important to resolve long
standing issues particularly with India and Afghanistan. Comprehensive dialogue which started
with India should be carried forward on the basis of equality. Moreover, during Prime Minister
Nawaz Sharif’s visit to Afghanistan in December 2015, he assured them, “the respect for
sovereignty and Afghanistan’s enemies are Pakistan’s enemies.” There is no denying there exists
mistrust between the two countries. However, Afghanistan should be apprised of economic
benefits. It is in dire need for economic development. Afghanistan can earn transit fee which will
improve its economy. Furthermore, as Iranian president Ruhani suggested, “Chabhar is not in
competition with Gwadar, but both will complement each other.” Recently, President Hassan
Ruhani while meeting with Prime Minister of Pakistan in New York showed willingness to
participate in CPEC. Therefore, promotion of regional cooperation is particularly important for
CPEC.

Conclusion
In the end, CPEC is an extraordinary project for Pakistan and China. It will uplift the economy of
Pakistan and cut down the distance for China from 13,000 Kms to 3,000 Kms. Moreover, it will
be a game changer for the entire region. The landlocked Afghanistan and Central Asian States
will get easy access to Gwadar port for trade purposes. However, it is very challenging task to
materialize the full potential of CPEC. Regional cooperation and connectivity will also help in
removing misgivings and pave the way for economic integration and peace resultantly. Thus,
CPEC is a testimony for China-Pakistan relations that are described as “sweeter than honey,
higher than Himalayas and deeper than oceans.” It is also a hope for the troubled region
CPEC is not only the name of road, port and railway system but a multi-dollars mega project
which will bring peace and prosperity in all the provinces of Pakistan. The chairman of the
Gwadar port, Dostain Khan Jamaldini said that the CPEC would not only benefit Balochistan but
also prove beneficial for the country's three other provinces.