What is CPEC and how will it affect India, Pakistan & China?

There is a lot of negative talk about China-Pakistan-Economic-Corridor in Indian, American and

some Western circles. However, in the long run this will be something great for everyone not
only in the region but also for Europe and the US.

Some background and factual information

Baluchistan is the largest province of Pakistan. Historically ignored for a variety of reasons
including complicit inattention by the feudal tribal aristocracy, corruption, lack of education and
to certain degree neglect on the part of the Central Government, this mineral rich province has
not developed as the rest of the country. Its natural resources are untapped. For example, it has
the world’s fifth largest reserves of gold and copper comprising the easy access to the Tethyan
belt of an arc of gold and copper reserves. This belt stretches from Hungary in Europe to
Indonesia in the Far East across Eurasia but is much easily accessible in Baluchistan.

The low level insurgency in Pakistani Baluchistan has been present in the province since
independence. There were at least five major spikes in violence which have occurred over the
same period with the latest starting in 2004 and continuing to as late as early 2014.

While the Baluch are Sunni Muslims, one fifths of them inhabit the Siestan and Baluchistan, a
southeastern province of mostly Shi’a Iran. In fact in the early seventies the Shah of Iran fearing
the eruption of Baluch nationalism had jointly conducted with Pakistan campaigns against the
Baluch in Pakistani Baluchistan. As recently as 2010 the Islamic Republic in Tehran executed a
large number of the leaders of a separatist movement, Jundallah on the Iranian side of the border
with Pakistan.

Pakistan has developed its second largest port Gwadar with the help of the Chinese along its
Arabian Sea coast in the far southwestern corner of its Baluchistan Province. China-Pakistan-
Economic-Corridor (CPEC) will stretch from the Western Chinese city of Kashgar in the
Xinxiang province of China to the port of Gwadar, thus providing China an access to the Arabian
Sea barely 600 kilometer east of the narrow Strait of Hormuz through which passes about 35% of
the world’s oil shipments.

CPEC which includes roads and railways will pass through the entire length of Pakistan, Azad
Kashmir (PoK) and Baluchistan and it will reduce the distance for Chinese goods bound for
Europe, Africa, the entire western hemisphere, substantially by almost 2000 miles and vice
versa. Trade by CPEC will be bypassing the Strait of Malacca in Southeast Asia by that many
miles. The Chinese goods if they were to be unloaded at New York or Norfolk and Baltimore
rather than California will travel less by two thousand miles though the Suez Canal route.

There exists a salivating anticipation of the completion of the widening of the Panama Canal in
early 2016, by the major US ports on the east coast, eager to trade with China, but when the
above corridor will be completed, a reduction of 2000 miles in the journey of goods from the
western hemisphere might as well become an equidistant route competing with the Panama
Canal route.
Therefore CPEC has global trade implications and if one day Northwestern Indian states were to
use the port of Gwadar, it would be cheaper and quicker to do business through this corridor.
Don’t think it would be impossible because precedence exist for the use of Fazilka-Amruka-
Bahawalpur route to be known as ‘The Golden Route” before 1947.

Of course, undeniably, there are some other geo political considerations with multiple competing
political interests relating to CPEP. All of those are fair when it comes to a nation state own’s
interest and I am not blaming anyone.

About a 100 mile west of Gwadar, the Iranian port of Chahbahar was built by Pakistan’s
archrival India to bypass Pakistan to reach its interests in Afghanistan in the early nineties.
Despite US and EU pressure, India conducts a trade of about 15 billion dollars with the Islamic
Republic and imports about 15 percent of its oil needs from Iran. India is the world’s fourth
largest consumer of hydrocarbons. Before the recently negotiated nuclear deal India had openly
declared that it would follow only the UN sanctions against the nuclear ambitions of Iran.
Moreover, India is building a railway from Chahbahar to connect to the Iranian Railway System
to reach the Central Asian markets and tap the mineral rich Central Afghanistan.

Meanwhile, China has been increasing its presence in the Indian Ocean with its ‘String of Pearls’
with its presence to which it has recently been added the island nation of Seychelles. This term
‘Sting of pearls’ was coined by the United States, but it is frequently used by Indian defense
analysts.

In this regard, China has a commercial and military presence in several nations around India
(besides Pakistan) in Burma, Bangladesh, Sri Lanka, Maldives and Somalia. With the opening of
the Trans- Pakistan road and rail corridor China (CPEC), an emerging power in the region will
not only bypass the Malacca Strait through which 80 percent of its oil supply presently flows,
but reduce the distance as noted above by 2000 miles.. China would not have to depend on the
US to keep the choke point of Strait of Malacca open because it will reach the warm waters of
Arabian Sea through friendly territory and the Pakistani port of Gwadar is hardly a few hundred
miles from the mouth of the Persian Gulf.

And while this regional dynamics seem to have threatened Indians as if the Chinese were
encircling them, Pakistan, China’s longtime ally in the region since it arranged the visit of
President Nixon’s first visit to the Communist nation in 1972, in itself feels encircled in turn by
India, while Indians are extending the Iranian railway into the mineral rich Afghanistan and hope
to increase their commercial and strategic interests in the former Soviet Central Asian Republics
(CARs).

There is however a bigger challenge for Pakistan and it seems to eventually lead to be greater
difficulty as to how United States is going to behave in the region in the near future. In this
context one should not forget that in its pursuit to punish Iran for its nuclear designs, the United
States had earlier blocked the construction of a gas pipeline from Iran to energy starved India
through both Iranian and Pakistani provinces of their own Baluchistan.

While Iran has already long completed this gas pipeline from its Pars gas field up to the Pakistani
border, it was on hold because of American pressure during sanctions. Meanwhile after signing a
civilian nuclear deal, India briefly pulled out soon to show a renewed interest in trans-Pakistan
Iranian gas. Even Bangladesh is part of this deal but the Americans have kept the pipeline
hostage in their obsession with the Iran’s nuclear designs. Now that an opening has come up
after the Iranian nuclear accord, this gas pipeline will be ultimately built. The construction a spur
from the Iranian border to Gwadar has already started.

The idea of building mega-projects through Baluchistan is nothing new. In the 90’s an earlier
American project, in which the oil and gas would have been transported by a pipeline from the
oil rich Central Asian Republics (CARs), through Afghanistan and Pakistani Baluchistan was
dropped due to the security issues.

Then came the idea of Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline and it had the
support of the United States because it would provide an alternate route to the Central Asian Gas,
while it would no longer be necessary for the CARs to depend on the existing Russian pipelines
which carry the gas to the Russian ports on the Black Sea. Additionally, TAPI would also bypass
Iran and the Indian and Pakistani thirst for gas will also be quenched without involving Iran.
TAPI is currently in its initial phases of design and may not be completed until 2020. Security
problem which looms over TAPI as well will mostly be in Afghanistan.

After originating at the Dauletabad gas field in Turkmenistan TAPI will follow the Herat-
Kandahar road and then enter Pakistan going through the Bolan Pass in Baluchistan. It will end
up at Fazilka in India on the border with Pakistan. Security of TAPI is a cause of concern in
southern restive Afghanistan, now that NATO troops have largely departed from the
Afghanistan.

All of the above information is being provided to show how pivotal Baluchistan can be to overall
economy and the national interest of Pakistan. Times have changed and Pakistan is looking to
improve the lot of its largest province. No central government is going to sit on her hands in this
global village of trade and Pakistan is not an exception despite the odds.

To illustrate the commitment of the central government, besides other development projects, 500
km of a 900 km motorway through the heart of rugged mountainous central Baluchistan has been
completed without a single incidence of sabotage. This was being constructed before the
announcement of CPEC.

So now that the US has quietly left Afghanistan at the end of 2014, and Taliban terror seems to
have abated after Pakistani military action, Prime Minister Sharif is bent on improving the
economy of Baluchistan in particular and Pakistan at large. He has no choice but to look to China
because in the context of the designs of India’s intentions and the ambiguous policy of the
United States about the region.

The United States while dragging along the European Union in its pursuit of the Iranians nuclear
issue has been ignoring at least on the surface or even obstructing the predicament of Pakistan.
The business minded Prime Minister of Pakistan, wants his country to become the new Asian
tiger and earnestly wants to make peace with India.

While keeping a large defense budget will be a drain on his budget and thus making it difficult to
improve the infrastructure in his own country, with no help from the West and the US, he has no
choices but to make peace with India and for better economic reasons, woo the Chinese and pay
attention to the security issues within Pakistan and that certainly includes Baluchistan.

While the Baluch cause has a lot of merit due to the neglect by the previous governments, it is
multifactorial, and the secessionist leadership has realized that if the security is better in their
ancestral homeland and if the Chinese invest heavily in Mr. Sharif’s vision, the resultant
prosperity will address their grievances and continued low level insurgency is in nobody’s
interest.

A recent noticeable development was declaration of one of the leaders of the separatist
movements. In a recent BBC interview Brahamdagh Bugti, the grandson of the late Nawab
Akbar Bugti and the most radical secessionist hinted on a peaceful solution to the Baluch
grievances.

With the Kashmir issue being stagnant since 1947 causing the two neighbors to start multiple
wars in the last century is no longer the way to prosperity. While the politician have to pander to
the extremist both in India and Pakistan, most of the population realizes that the status quo in
Kashmir is acceptable and trade across the 1000 mile border is in the interests of both sides. No
one wants another war which could bring the region to the nuclear brink. While India’s
conventional forces are far superior to Pakistan, in retaliation Pakistan would have no choice to
use its nuclear arsenal and nobody in their correct minds wants that for the region and for that
matter for the world. Be it due to its regional implication but its environmental problems that a
nuclear exchange will cause to the planet’s atmosphere.

Therefore the skeptics should pursue a conciliatory course in the region and even offer help to
Pakistan in Mr. Sharif’s efforts to improve Pakistani infrastructure. An economically advanced
Pakistan, perhaps a new Asian Tiger will help dilute the impact of the Taliban on the Afghan
border, satisfy the grievances of the Baluch and enable both Pakistan and India to start a
multibillion trade with each other. American and Western absolute fixation on Iran is
counterproductive and a prosperous Pakistan and therefore CPEC is in everyone’s interest.