CPEC: The new economic corridor

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The China-Pakistan Economic Corridor (CPEC) is the game changing package of Chinese capital and engineering worth $54 billion in investment and lending, and has raised apprehensions in neighboring India.But the ultimate aim is to bring together china, India and Pakistan as a part of a Eurasian market formed by Chinese president Xi Jinping’s ‘OneBelt OneRoad’ policy’.Perceiving the CPEC to be a threat,Indian’s nefarious thinking has stayed away India from “One Belt One Road” project, as this was the joint endeavor by Pakistan and china. But the exclusive impression was that the communication line will bridge the Indian Ocean and china from Baluchistan’s Gwader port up through the Karakorum highway into Xinjiang, the mini-continent-sized northwest province of China.

In conceiving support for another infrastructure project like chabahar to be a competitor, Delhi’s strategic thinking narrowly construesthe CPEC, exaggerates the standing gained from geopolitical trophies, and lacks appreciation for the tangibles and breadth of an initiative that holds the power to transform Pakistan. The multi spinoffs are more than a transit routes, $27 billion worth of CPEC resourcesare,in fact, allocated to undertake 18 power projects. The other half of the total $54 billion goes far beyond support for the Gwader port complex and will include the Engineering of four National Trunk Highways, construction of three mainline railways, the start of a metro system in Lahore, cross country pipeline, hydropower plants and other development projects, being built from the restive Xinjiang province in china to Gwader in southwestern Pakistan. The corridor, which came into operation,last November, passes through Gilgit-Baltistan in Pakistan-AdministratedKashmir- a territory claimed by India. Both the south Asianneighbors claim the disputed Kashmir region in full, but control parts of it.

On 17 Jan-2017,speaking at a seminar in New Delhi, the Hon’ble Prime Minister Narendra Modi said: “only by respecting the sovereignty of countries involved, can regional connectivity corridors fulfill their promise and avoid differences and discord.” The Hon’ble Prime Minister was referring to the Economic corridor, which was confirmed by his foreign secretary, Subrahmanyam jaishankar two days later. He said,“We expect they respect other people’s sovereignty”.But the economic integration is that Pakistan’s foreign Ministry spokesman Nafees Zakaria had dismissed the New Delhi’s concerns. He told the international electronic media channel AL-JAZEERA that economic corridor is a “comprehensive and broad-based economic cooperation project”. “The project will contribute to the economic development of the entire region and not only for the Pakistan and china,” he said.

India’s Concerns

The fact that the route passes through the disputed Kashmir region seems to worried India, which has about half a million troops stationed in its part of the territory to quell more than two decades of armed rebellion. “China is using land area illegally occupied by Pakistan,” said Seshadri Chari, a national executive member of the ruling Hindu nationalist Bharatiya Janata Party.But Beijing is willing to address India’s concerns. China’s foreign ministry spokeswomen, Hua Chunying told the media that Beijing is committed to developing friendly and cooperative relations with others and that CPEC would not affect the Beijing’s position on Kashmir. Recently China defended the strategic CPEC passing through Pakistan Administrated Kashmir, over which India has lodged a strong protest, has “no direct link” with the Kashmir issue as it was an “Economic” venture. Seeking to allay India’s concerns, China also said New Delhi was welcome to actively participate in the ‘One Belt One Road’ (OBOR) project, a pet initiative of Chinese President Xi-Jingping.

Last year while formally opened the two-day “Belt and Road” forum in Beijing. Chinese president xi Jingping Pleading a massage for the world and for India, as he inject an additional $124 billion into “One Belt One Road”initiative, Xi said the project is“Project of the century”. While India didn’t participate in the forum citing soverginity issues over the OBOR’s flagship project,. In opening address at OBOR flagship project Chinese President without referring to India or CPEC, said, “All countries should respect each other’s soverginity,dignity and territorial integrity, and each other’s development paths and other’s core interests and major concerns”.

The former Prime Ministerof Pakistan Mian Nawaz Shareef while in his address made veiled references to India, as he spoke about CPEC. “CPEC is an Economic undertaking which is open to all countries in the region and has no geographical boundaries and not to be politicized. In implementing this corridor, we are not striving to merely leverage geography for economic prosperity, we are also trying to build transcend our differences, resolve conflicts through dialogue and diplomacy, and leave a legacy of peace for future generations. “He said” as various print and electronic media had reported.

The CPEC can be a catalyst for economic connectivity and integration in central Asia, South Asia and West Asia. Objections by India or any other country to such an economic project is, therefore, beyond comprehension. The CPEC is anticipated to boost Pakistan’s economy, where the GDP is expected to grow by more than five percent by 2020. The 3,200 Km-long Corridor is intended to connect the world’s second largest economy, China, with the Middle East and Central Asia reducing the alternative sea route distance-via the Malacca Strait-by 10,000Km.

Unbeknown to strategists in Delhi,the CPEC’s real competitor is ‘Make in India’. The long-term economic calculation for India and Pakistan is the same. Due to the doubling of blue-collar ages every seven years in China,factories will either move to other Asian countries or stay in china in highly automated factories. For India,Pakistan and other Asian countries aiming for middle income status, capturing relocated manufacturing is pivotal. In textiles alone, China has giant lead,shipping $274 billion in exports annually compared to $40 billion by India, the second-largest exporter. If ‘Make in India’ takes the lion’s share of textile exports, that alone creates more direct jobs than the 3.7 million current jobs in the Indian IT and BPO Industries. However, despite continued revenue growth for IT companies and factories alike are adopting rapid automation, a phenomenon that will, in the next five years, shrink the already small BPO and IT work force in India by 500,000 jobs. India has 1 million people reaching working age every month and needs to see through ‘Make in India’, just as the CPEC is critical to Pakistan’s stable future.

On the other hand, India isn’t making as much progress as it has sought. While the NDA government has paved more kilometers of roads per day than its predecessor and reached coal production targets made from the outset, inadequacies are clearin the momentum of this government’s infrastructure ambitions. Due to fiscal exhaustion, a shortlived railway construction boom will likely peter out and frequent power cuts will persist even with a power production surplus unless inefficient transmission is overhauled. ‘Make in India’ can’t go far with Hon’ble PM Modi’s infrastructure predicament. But Pakistani manufacturing growth will be powered by Chinese logistical performance.

The true competition is that the Delhi’s strategic community doesn’t see the true competition.The basic blunder is thatIndia is turning away from an opportunity. The actual daunting challenge for India is in the CPEC’s commercial success enabling as a successor in labor-intensive export manufacturing. It’s doubly off base to see Indian security threatened and consider sabotage through proxy conflict. The CPEC fosters restraint and discourages provocation by Pakistan due to the gain in national ego from greater achievement than its rival and having then something to lose in the material benefits of a climbing standard of living. But there’s something India is already losing in its posture to ‘Belt and Road’. If proportionately scaled, India is missing out on $400-500 billion in financing and investment with rail and electricity likely benefiting most. Perhaps, the inaptly named CPEC should have been called ‘Make in Pakistan’. That would make clear the opportunity and challenge from china for ‘Make in India’.

(The writer is a Srinagar based freelance Journalist, can be reached at [email protected])

Courtesy: Daily Times Pakistan

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