FUTURE OF CPEC IN WAKE OF CORONAVIRUS

Aditya Srivastav, National Defence Bureau,
New Delhi, 07 May 2020

CPEC (China Pakistan Economic Corridor) also known as BRI (Belt and Road Initiative). It’s a mega project funded by Pakistan and China to open the gateway for trade routes in Central Asia. It was inaugurated in 2015 with $46 Million Chinese investment under its

OBOR (One Belt One Road) to seek connectivity from it’s Xinxiang to southern Pakistan port of Gwadar. A vast network of highways and railways are to be built under the aegis of CPEC that will span the length and breadth of Pakistan. Inefficiencies stemming from Pakistan’s mostly dilapidated transportation network are estimated by the government to cause a loss of 3.55% of the country’s annual GDP. Modern transportation networks built under CPEC will link seaports in Gwadar and Karachi with northern Pakistan, as well as points further north in western China and Central Asia.

The spread of pandemic Coronavirus has brought the world to an economic standstill throughout the world, countries have been in lockdown since March and some may continue beyond June 2020. Small businesses are closing down and a lot importance and reliance is associated with timely completion of CPEC projects. The pandemic of Coronavirus is going to impact the Chinese economy and the impact will inevitably have an impact on Pakistan economy per-se.

Chinese citizens working on different projects of CPEC, travelled to China to celebrate the Chinese New Year and a significant number of them belonged to Wuhan province. Now the restricted move of Chinese workers back to work got affected as they could not return freely. The Chinese adopted a policy of double quarantine period. A quarantine period of 14 days in China and another quarantine period of 14 days on arrival in Pakistan for every Chinese citizen working in CPEC projects.

It will be difficult to impose and care has to be taken so that these Chinese workers do not come in contact with the locals and stop the further spread of pandemic in Pakistan and hamper the progress of all the projects as associated with CPEC. Now due to lockdown in Pakistan being enforced, business closed, factories closed and other routine work place being closed will have an impact on CPEC projects. It is envisaged that a delay of eight weeks will be there in various projects, this amount of delay is still manageable but any further delay due to pandemic or any other reason will have disadvantage and greater consequences.

The last mile stop is the Gwadar Port. All business zones and centres are completely closed in Gwadar Port and its impact is clearly visible as there is hardly any traffic and the port is working not to its capacity. Balochistan is home to Gwadar Port, a key pillar of CPEC, but Balochistan is embroiled in separatist movement, which has now dragged China into the conflict. The recent suicide attack on Chinese engineers and workers on CPEC a project pose a difficult challenge to Pakistan and signifies risk that the projects face in the country with several internal conflicts are simmering. The resource-rich Balochistan demands fair revenue from the projects in the area and want greater political autonomy.

India’s opposition to the CPEC has been on two reasons, first it violates the sovereignty as it runs through PoK (Pakistan Occupied Kashmir) and India lays a claim to the Gilgit-Baltistan region and whole of PoK. The second reason being it may counterbalance the economy of India. India has invested $100 Million in Chabahar Port in Iran which is 175 km from Gwadar Port. It was with intent to counter the success of Gwadar Port, but due to sanctions on Iran from USA the project has its own setbacks and could not be developed with expected pace.

Pakistan has to come out clean in the wake of spread of pandemic of Coronavirus, the CPEC since its inception has been shrouded in mystery. Islamabad has signed the agreements with China on CPEC have not been made public. CPEC has benefited the eastern provinces of Punjab and Sindh more than the underdeveloped provinces of Balochistan and Khyber Pakhtunkhwa. There is another genuine concern that CPEC may put Pakistan in a debt trap as most of the projects are funded by loans from China or Asian Development Bank. Any delay in commencement or completion of projects and hardly any move of goods from Gwadar Port will surely affect the Pakistan economy in the long run and put Pakistan on increased overdependence on China. The Chinese will extract more natural resources from PoK territory through mining and power projects. Pakistan will become a semi-colony of China due to COViD 19 Impact. In case the situation continues to be grim, China may deploy its Army to assist Pakistan Army. It appears that Pakistan government is in no control over the situation and they are looking towards China to bailout form this crises and pandemic.

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