China-Pakistan: Beijing to "Further Deepen and Expand" Ties, Support Pak "Financial Stability"

Top Chinese officials have committed to “further deepen and expand” ties with Pakistan at meetings at the highest levels between the military and civilian leaderships of the two nations.  Chinese Prime Minister Li Qiang assured  Prime Minister Shehbaz Sharif of his country's support for Pakistan's "financial stability".  Also in the news this week is a Chinese government commission report recommending the construction of a 3,000 kilometer long railway link between China and Pakistan at an estimated cost of $57.7 billion, making it the most expensive infrastructure project in the Chinese-sponsored Belt and Road Initiative (BRI) to date.  The railroad will connect Pakistan's Gwadar Port on the Arabian Sea with the western Chinese city of Kashgar in Xinjiang province. This appears to be a part of the Chinese response to the US-led Indo-Pacific strategy which Beijing sees threatening its interests in the region. Will India allow itself be used as a US proxy against China? Will the US-China rivalry force India and Pakistan to choose sides as it plays out in South Asia? Will China's assistance now push Pakistan further into the Chinese camp? 

US-India Ties:

US President Joseph R. Biden is pursuing close strategic ties with Indian Prime Minister Modi. The false rhetoric of "democracy" and "shared values" is often used to disguise Washington's true intent to use India to counter China's rise as a global superpower. Meanwhile, China with its long land border with India has warned New Delhi that it "will be the biggest victim" of the US proxy war against China.  In a recent Op Ed in Global Times, considered a mouthpiece of the Beijing government, Professor Guo Bingyun  has wrote as follows: 

"Inducing some countries to become US' proxies has been Washington's tactic to maintain its world hegemony since the end of WWII. It does not care about the gains and losses of these proxies. The Russia-Ukraine conflict is a proxy war instigated by the US. The US ignores Ukraine's ultimate fate, but by doing so, the US can realize the expansion of NATO, further control the EU, erode the strategic advantages of Western European countries in climate politics and safeguard the interests of US energy groups. It is killing four birds with one stone......If another armed conflict between China and India over the border issue breaks out, the US and its allies will be the biggest beneficiaries, while India will be the biggest victim. Since the Cold War, proxies have always been the biggest victims in the end". 

US-Pakistan Ties: 

After assuming office as President of the United States, Joe Biden called many world leaders. But he did not bother to call then Pakistani Prime Minister Imran Khan, nor has he made a call to the current Prime Minister Shehbaz Sharif. This has sent a clear signal to Islamabad that Washington doesn't see it as important.  This prompted Brookings' Bruce Reidel and Madiha Afzal to write: "Biden did not call Khan while he was prime minister. Last fall, we argued he should. Khan in turn declined to attend Biden’s Summit for Democracy. The White House should call Shahbaz Sharif". 

Madiha Afzal of Brookings Institution again reminded Biden this year that "Pakistan, the fifth-largest country in the world and a nuclear-armed nation, ought to be seen by the United States on its own terms and not through the prism of its neighbors. A cold shoulder risks pushing Pakistan further toward China — which is neither an inevitable nor desirable outcome for the United States".  

CPEC and BRI

CPEC Transforming Pakistan: 

Back in 2018, former US Ambassador to Pakistan Richard G. Olson wrote in  a New York Times Op Ed titled "How Not to Engage With Pakistan" that "(CPEC's) magnitude and its transformation of parts of Pakistan dwarf anything the United States has ever undertaken".  Olson went on to warn the Trump Administration that "Without Pakistani cooperation, our (US) army in Afghanistan risks becoming a beached whale". Among the parts of Pakistan transformed by China Pakistan Economic Corridor (CPEC) are some of the least developed regions in Balochistan and Sindh, specifically Gwadar and Thar Desert. 

Source: China Daily

Pakistan's Economic Crisis:

Some blame Pakistan's current balance of payments crisis on Chinese debt taken on to fund CPEC projects. The evidence does not support this. The fact is that Pakistan failed to grow its exports while its imports boomed for over 5 years on Prime Minister Nawaz Sharif's watch from 2013-2018. It forced Pakistan to seek an IMF bailout which came with its own tough conditions to compel economic reforms and greater fiscal discipline. Geopolitics has also played a role in it. The Ukraine War pushed the energy and other commodity prices higher, exacerbating Pakistan's trade deficits. At the same time, the Biden administration has shown little support for Pakistan's bailout by the IMF.  China's latest commitment to support "Pakistan's financial stability" will help, pushing Pakistan further into the Chinese camp. 

Here's a Wall Street Journal video on US-China Rivalry and Pakistan:

https://youtu.be/wvw-85CC1t4

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New Gwadar International Airport: Pakistan's 2nd Greenfield Class 4F Airport Nearing Completion

The architecture of the New Gwadar International Airport (NGIA) is inspired by a rising Phoenix. It is Pakistan's second greenfield airport built from scratch in a new location. With a 3,650-meter long runway, it is a Class 4F airport.  NGIA is scheduled to begin test flights in December this year.  The only other airport with a 3,600-meter long runway is the New Islamabad International Airport that opened for commercial flights in 2018. Karachi and Lahore international airports have runways lengths of 3,400 meters and 3,360 meters respectively, putting them in 4E class. All four of these major Pakistani airports can handle landing of Airbus A380, the largest commercial airliner in operation today. 

New Gwadar International Airport Architecture Inspired by A Rising Phoenix

New Gwadar International Airport (NGIA) is being built in Gwadar at a cost of $246 million on an area of 4,300 acres. Construction of NGIA started in October, 2019. The entire project is being built by the state-owned China Airport Construction Company funded by a Chinese government grant. It was originally scheduled for completion in 36 months. The work was slightly delayed due to the COVID19 pandemic. It is now expected to be ready for trial flights in December, 2022. 

New Gwadar International Airport, Gwadar, Pakistan

NGIA is part of the China Pakistan Economic Corridor (CPEC) projects. Another key CPEC project recently completed in Gwadar is the 19-kilometer long six-lane East Bay Expressway. It was opened for traffic on June 3, 2022. East Bay Expressway connects to the Makran Coastal Highway which in turn is connected to the larger network of motorways and highways in the country as well as to China and the landlocked nations of Central Asia in CAREC. 

East Bay Expressway, Gwadar, Pakistan

The completion of New Gwadar International Airport and East Bay Expressway is an indication that the Western and Indian media headlines about the death of CPEC are not credible. To the contrary, the continuing progress on CPEC projects confirms the strong commitment of both the Chinese and the Pakistan government to move forward with their broad-based cooperation. Just yesterday, Pakistan's new Prime Minister Shehbaz Sharif reaffirmed that his government is determined to complete all the projects under the multi-billion-dollar China-Pakistan Economic Corridor (CPEC). Earlier, Chinese Foreign Ministry Spokesman Zhao Lijian said China would continue to support its companies in investing and operating in Pakistan to realize win-win results and shared development. 

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Is CPEC Development Focus Shifting From Gwadar to Karachi?

China has agreed to invest $3.5 billion in Karachi, according to Pakistani and Chinese officials. In a separate announcement earlier, Saudi Arabia said it is moving its planned $10 billion petrochemical complex from Gwadar to Karachi.  These announcements have triggered speculation that the focus of development of China Pakistan Economic Corridor (CPEC) is moving from Gwadar to Karachi. 

Karachi Port, Pakistan

The Karachi project dubbed "Karachi Coastal Comprehensive Development Zone project" or KCCDZ    includes additional new berths to Karachi port, development of a new fisheries port and a 640-hectare special economic zone near the port. The project also envisages building a harbor bridge connecting the port with the nearby Manora islands, according to Nikkei Asia. 

Gwadar Port City

Saudi decision to shift the $10 billion petrochemical plant from Gwadar to Karachi was triggered by the fact that there is no oil pipeline nor a rail line planned to support it at Gwadar. Karachi already has well-developed roads, rails, telecommunications and pipeline infrastructure for connectivity with the rest of the country. 

Map of Submarine Cable Connections to Karachi, Pakistan. Source: TeleGeography

There are 10  submarine cables currently connecting or planned to connect Pakistan with the world: TransWorld1, Africa1 (2023), 2Africa (2023), AAE1, PEACE,  SeaMeWe3, SeaMeWe4, SeaMeWe5, SeaMeWe6 (2025) and IMEWE. PEACE cable has two landing stations in Pakistan: Karachi and Gwadar. SeaMeWe stands for Southeast Asia Middle East Western Europe, while IMEWE is India Middle East Western Europe and AAE1 Asia Africa Europe 1. PEACE cable is the latest. It is a privately owned submarine cable that originates in Karachi, Pakistan and runs underwater all the way to Marseilles, France via multiple points in the continent of Africa. 

Gwadar East Bay Expressway, Pakistan

China already has a lot invested in Gwadar.  Krzysztof Iwanek, head of the Asia Research Center at Warsaw's War Studies University, told Nikkei that the challenges of developing a major port in an underdeveloped area like Gwadar must have been factored in by China from the outset. "[I]t may be assumed that Chinese involvement in Gwadar may be at least partially strategic. Karachi, in turn, is Pakistan's most important port, and, hence, Chinese involvement there may be of purely economic nature," Iwanek said.

My own view is that Gwadar remains very important to China for strategic reasons. Gwadar sits very close to the strategic Strait of Hormuz that is used by tankers carrying the bulk of China's and the world's energy imports.  Karachi is the fastest and most economical route to making CPEC operational but it does not diminish the long-term importance of Gwadar for China. 

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Pakistan Shipbuilding Industry and Blue Economy

Karachi Shipyard, the oldest and the only major shipyard in Pakistan, is experiencing unprecedented growth.  It is rapidly expanding manufacturing facilities to respond to growing demand for both civilian and military vessels. Karachi also has several small boat yards near Karachi Fish Harbor where craftsmen build wooden fishing vessels with their hands to meet fishermen's demand.  There are now plans in the works for building a new shipyard in Gwadar.  Pakistan has the potential to build a large "Blue Economy" in its 290,000 square kilometers of coastal water or about 36% of the country's land area open for tapping vast resources in it.  These resources include seafood and energy resources as well as international transport and trade connectivity with the rest of the world. It offers opportunities for water sports, recreation and tourism in the coastal areas of Pakistan. Pakistan needs a large fleet of ships to defend it and to take full economic advantage of it. 

Blue Economy. Source: World Bank

Karachi Shipyard:

Several new dry docks are being built at Karachi Shipyard and Engineering Works (KSEW) to cater to growing demand from Pakistan Navy and other government agencies. Two patrol boats have been built jointly with Dutch builder Damen at KSEW and delivered to Pakistan Customs.  

Four Type-039B ‘Hangor Class’ Chinese designed AIP submarines are planned to be built at KSEW. Keel-laying ceremony was held recently at KSEW for Turkish-designed MILGEM corvettes for Pakistan Navy. There are discussions underway to build Dutch Damon corvettes at KSEW for Pakistan Navy. 

Karachi shipyard is too small for servicing large ships owned by Pakistan National Shipping Corporation (PNSC). 

Karachi Fish Harbor:

Pakistani craftsman are continuing to build wooden fishing vessels for domestic and foreign buyers. They deliver 30 to 40 fishing vessels every year, in addition to repair work at the yard. Their foreign customers include fishermen from Iran, Yemen, Saudi Arabia and UAE. 

Currently, the builders are taking orders for cargo vessels since the demand for fishing boats has gone down due to a variety of reasons, including the use of over-aged vessels, according to Arab News. 

Gwadar Shipyard:

Karachi Shipyard and Engineering Works (KSEW) has recently acquired land in Gwadar to establish another major shipyard where much larger ships can be built and serviced. KSEW chief Rear Admiral Ather Saleem has told The News “The decision has been taken in view of increased movement of ships and maritime activities at Gwadar Port in the backdrop of China-Pakistan Economic Corridor (CPEC).”      

KSEW in Karachi currently has 2 dry docks of limited capacities of 18,000 and 26, 000 DWT. It also has 3 shipbuilding berths with capacities of 6000 DWT, 15000 DWT and  26000 DWT. These are too small for Pakistan National Shipping Corporation cargo ships and tankers. Deadweight tonnage of the biggest PNSC tanker Aframax Tanker Quetta is 107,215.  

Blue Economy:

Pakistan has a 1,000 kilometers long coastline on the Arabian Sea with maritime sovereignty over 200 nautical miles deep Exclusive Economic Zone (EEZ) and 150 nautical miles of Continental Shelf. This adds 290,000 square kilometers of sea or about 36% of the country's land area open for tapping vast resources in it. 

Pakistan's "Blue Economy" in this extended economic zone includes seafood and energy resources as well as international transport and trade connectivity with the rest of the world. It offers opportunities for water sports, recreation and tourism in the coastal areas of Pakistan.  Pakistan needs a large fleet of ships to defend it and to take full economic advantage of it. 

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India-Iran-Afghanistan Axis Against Pakistan?

A JIT (Joint Investigation Team) report recently released by Sindh government in Pakistan has revealed that the infamous Karachi gangster Uzair Baloch worked for Iranian intelligence. Apparently, Uzair Baloch was also in contact with Indian intelligence agents working in Iran, according to Indian media reports. Baloch's interrogation led to the discovery and arrest of Indian undercover agent Kulbhushan Jadhav in Balochistan shortly after Baloch's arrest. Kulbhushan Jadhav has confessed to orchestrating deadly terror attacks in Balochistan and Karachi.
He has said that India's RAW funneled money through Indian consulates in Jalalabad, Kandhar (Afghanistan) and  Zahidan (Iran) to BLA and TTP for terror attacks in Balochistan and Karachi. Targets of terror attacks included people, mosques, roads, port and Balochistan's Hazara Shia community.

L to R: Indian Prime Minister Modi, Iranian President Rouhani and Afghan President Ghani

Chabahar vs Gwadar:

Chabahar is a port being constructed by Indians in Iran. The stated goal of this project is to bypass Pakistan for India's trade with Afghanistan and Central Asia via Iran. Indian media have promoted Chabahar as a competitor to Gwadar Port which is a part of the China-Pakistan Economic Corridor (CPEC).  Indian government is openly hostile to CPEC and declared support for Baloch insurgents.  The leaders of Afghanistan, India and Iran have held regular summit meetings to promote Chabahar port project.

4,000 Indians in Chabahar:

There are 4,000 Indians working in Chabahar, Iran, according to Indian journalist Karan Thapar. Some of them, like Kulbhushan Jadhav, work undercover for Indian intelligence agency RAW.  It is hard to believe that the Iranian intelligence is not aware of the presence of undercover Indian agents among the 4,000 Indians working in Chabahar. After all, Jadhav had two passports, one in his own name and another in the name of Hussein Mubarak Patel. The Indian Express and Asian Age, both Indian publications, suggest that Jadhav had links with Uzair Baloch who has been convicted by for working for the Iranian intelligence in Pakistan.  Kulbhushan Jadhav has confessed to orchestrating deadly terror attacks in Balochistan and Karachi. He has said that India's RAW funneled money through Indian consulates in Jalalabad, Kandhar (Afghanistan) and  Zahidan (Iran) to BLA and TTP for terror attacks in Balochistan and Karachi. Targets of terror attacks included people, mosques, roads, port and Balochistan's Hazara Shia community.

Pakistan's Complaint to Iran:

Paskistan has complained to Iran about allowing Baloch insurgents to use Iranian territory to launch terrorist attacks in Pakistan after an attack  killed 14 people along Pakistan’s coast in 2019, according to Reuters.

“The training camps and logistical camps of this new alliance...are inside the Iranian border region,” Pakistan Foreign Minister Shah Mahmood Qureshi told reporters in Islamabad. Qureshi said he has spoken to his Iranian counterpart, Mohammad Javad Zarif, and conveyed to him the “anger of Pakistani nation”.

Karachi Stock Market Attack:

Four terrorists belonging to Baloch Liberation Army attacked the Pakistani stock exchange in Karachi on June 29, 2020, killing two guards and a policeman and wounding seven others before being shot dead. Pakistan believes that the attackers came from southeastern Afghanistan where they enjoy safe havens with the support of intelligence agencies like Afghan NDS and Indian RAW.

Qasem Soleimani:

Iranian Revolutionary Guard Corp (IRGC) commander General Qasem Soleimani who was assassinated by the United States in drone strike was particularly hostile toward Pakistan. In February, 2019, Soleimani threatened Pakistan. He boasted about Iran's "independent power and honor". Soleimani, known to be close to Supreme Leader Ayatollah Khanenai, reportedly had serious policy disagreement with the Rouhani government.  He said:

"I warn you not to test Iran and anyone who has tested Iran has received firm response. We are speaking to Pakistan with a friendly tone and we are telling that country not to allow their borders to become a source of insecurity for the neighboring countries..... Iran enjoys independent power and honor. Some countries have wealth, but no prowess. Trump tells the Al-Saud that if it hadn't been for the US support, Saudi Arabia would not have survived and Saudi Arabia's coalitions in the region have all ended in failure."

Soleimani's tone in this message to Pakistan is anything but "friendly".

Summary:

Recent release of Sindh government report reveals that Karachi gangster Uzair Baloch spied for Iran in Pakistan.  There are 4,000 Indians working in Chabahar, Iran, according to Indian journalist Karan Thapar. Some of them, like Kulbhushan Jadhav, work undercover for Indian intelligence agency RAW.  Chabahar is a port being constructed by Indians in Iran. The stated goal of this project is to bypass Pakistan for India's trade with Afghanistan and Central Asia via Iran. Indian media have promoted Chabahar as a competitor to Gwadar Port which is a part of the China-Pakistan Economic Corridor (CPEC). The Indian Express and Asian Age, both Indian publications, suggest that Jadhav had links with Uzair Baloch.  Kulbhushan Jadhav has confessed to orchestrating deadly terror attacks in Balochistan and Karachi. He has said that India's RAW funneled money through Indian consulates in Jalalabad, Kandhar (Afghanistan) and  Zahidan (Iran) to BLA and TTP for terror attacks in Balochistan and Karachi. Targets of terror attacks included people, mosques, roads, port and Balochistan's Hazara Shia community.

Here's Kulbhushan Jadhav's confession video:

https://youtu.be/nVp62OinTeU




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CAREC: More Landlocked States Look to Pakistan's Gwadar Port

Uzbekistan is the third landlocked state in recent years to request the use of Pakistani ports for trade, according to media reports.  The Central Asian nation has asked to join Quadrilateral Traffic in Transit Agreement (QTTA) to make use of Karachi and Gwadar ports for its trade operations. Current members of QTTA are China, Pakistan, Kyrgyzstan and Kazakhstan. Afghanistan is not a member of QTTA but it currently uses Gwadar and Karachi ports under Afghanistan-Pakistan Transit Trade Agreement (APTTA). Pakistan is making a serious effort to stabilize Afghanistan, a member of CAREC. The recent US-Taliban peace deal is the result of Pakistan's efforts to bring the warring sides to the negotiating table. Afghan instability has prevented Pakistan from connecting with other STANs for commerce and trade. Now the development of CPEC will enable Pakistan to bypass Afghanistan, if necessary, to connect with Central Asia region through Western China.

Pakistan to Bypass Afghan Wakhan Corridor to Trade With Central Asia Via China

Quadrilateral Traffic in Transit Agreement (QTTA):

The Quadrilateral Traffic in Transit Agreement (QTTA) is a transit trade deal between China, Pakistan, Kyrgyzstan and Kazakhstan for facilitating transit traffic and trade.

In addition to being members of QTTA, China, Pakistan, Kyrgyzstan and Kazakhstan are also part of CAREC, the Central Asian Regional Economic Cooperation. Other CAREC member nations include Afghanistan, Azerbaijan, Georgia, Mongolia, Tajikistan , Turkmenistan and Uzbekistan.

China-Pakistan Economic Corridor (CPEC) infrastructure projects have strengthened Pakistan's connectivity with landlocked Central Asia region in recent years.

CAREC Ministerial Meeting Islamabad, Pakistan

CAREC or SAARC:

Pakistan sits between two economically very dynamic regions: Central Asia (and Western China) and South Asia. Which region is better suited for its economic connectivity and integration? Should Islamabad focus on CAREC (Central Asia Regional Economic Cooperation) rather than SAARC (South Asian Association of Regional Cooperation)?

Ideally, Pakistan should be a major player in both vibrant regions. However, Indian Prime Minister Narendra Modi has adopted a belligerent tone that has been characterized by his boasts of "chhappan inch ki chhati" (56 inch chest) and  talk of  "munh tor jawab" (jaw-breaking response) and "boli nahin goli" (bullets, not talks) to intimidate Pakistan in the last few years.   All of Modi's actions, including his order to bomb Balakot in Pakistan in February 2019, have signaled his outright aggression against Pakistan. His government's actions in Kashmir have extinguished any hope of normal relations between South Asia's two largest economies in the foreseeable future.  These have essentially forced Pakistan to choose between SAARC and CAREC.

CAREC Corridors: 

CAREC region is building six economic corridors to link Central Asian nations. Six multi-national institutions support the CAREC infrastructure development, including the Asian Development Bank (ADB), United Nations Development Program (UNDP), International Monetary Fund (IMF), World Bank,  Jeddah-based Islamic Development Bank and European Bank for Reconstruction & Development, according to Khaleej Times.

Out of the total $27.7 billion CAREC infrastructure investment so for, $9.9 billion or 36 per cent was financed by ADB, a senior officer of the Manila-based multinational bank told Khaleeej Times.

He said other donors had invested $10.9 billion while $6.9 billion was contributed by CAREC governments. Of these investments, transport got the major share with $8 billion or 78 per cent. Asian Development Bank Vice President Wencai Zhang said: "There are huge financing requirements in Carec for transport and trade facilitation, for which 108 projects have been identified at an investment cost of $38.8 billion for the period 2012-2020. Investment for the priority energy sector projects will be $45 billion in this period."

CPEC North-South Corridor:

China Pakistan Economic Corridor (CPEC) is a major part of the north-south corridor that will allow trade to flow among CAREC member countries, many of which are resource-rich but landlocked nations. The corridor will enable the group to access to the Pakistani seaports in Gwadar and Karachi as part of the new maritime silk route (MSR) as envisioned by China and Pakistan.

CPEC consists of transport and communication infrastructure—roads, railways, cable, and oil and gas pipelines—that will stretch 2,700 kilometers from Gwadar on the Arabian Sea to the Khunjerab Pass at the China-Pakistan border in the Karakorams.

China and Pakistan are developing plans for an 1,800 kilometer international rail link from the city of Kashgar in the Xinjiang Uygur autonomous region in Western China to Pakistan's deep-sea Gwadar Port on the Arabian Sea, according to Zhang Chunlin, director of Xinjiang's regional development and reform commission.

Rail Network Bypasses Afghanistan

 "The 1,800-kilometer China-Pakistan railway is planned to also pass through Pakistan's capital of Islamabad and Karachi," Zhang Chunlin said at the two-day International Seminar on the Silk Road Economic Belt in Urumqi, Xinjiang's capital, according to China Daily.

"Although the cost of constructing the railway is expected to be high due to the hostile environment and complicated geographic conditions, the study of the project has already started," Zhang said. "China and Pakistan will co-fund the railway construction. Building oil and gas pipelines between Gwadar Port and China is also on the agenda," Zhang added.

Afghan Instability:

Pakistan is making a serious effort to stabilize Afghanistan, a member of CAREC. The recent US-Taliban peace deal is the result of Pakistan's efforts to bring the warring sides to the negotiating table. Afghan instability has prevented Pakistan from connecting with other STANs for commerce and trade. Now the development of CPEC will enable Pakistan to bypass Afghanistan, if necessary, to connect with Central Asia region through Western China.

Summary:

A growing list of landlocked Central Asian countries is lining up to use Pakistani ports of Gwadar and Karachi for trade. Uzbekistan is the latest nation to do so. China-Pakistan Economic Corridor (CPEC) infrastructure projects have strengthened Pakistan's connectivity with landlocked Central Asia region in recent years.  The Quadrilateral Traffic in Transit Agreement (QTTA) is a transit trade deal between China, Pakistan, Kyrgyzstan and Kazakhstan for facilitating transit traffic and trade.

In addition to being members of QTTA, China, Pakistan, Kyrgyzstan and Kazakhstan are also part of CAREC, the Central Asian Regional Economic Cooperation. Other CAREC member nations include Afghanistan, Azerbaijan, Georgia, Mongolia, Tajikistan, Turkmenistan and Uzbekistan.  Pakistan is making a serious effort to stabilize Afghanistan, a member of CAREC. The recent US-Taliban peace deal is the result of Pakistan's efforts to bring the warring sides to the negotiating table. Afghan instability has prevented Pakistan from connecting with other STANs for commerce and trade. Now the development of CPEC will enable Pakistan to bypass Afghanistan, if necessary, to connect with Central Asia region through Western China.

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CPEC is Transforming The Least Developed Parts of Pakistan

In a New York Times Op Ed titled "How Not to Engage With Pakistan",  ex US Ambassador to Pakistan Richard G. Olson says "Its (CPEC's) magnitude and its transformation of parts of Pakistan dwarf anything the United States has ever undertaken".  Olson goes on to warn the Trump Administration that "Without Pakistani cooperation, our (US) army in Afghanistan risks becoming a beached whale".

Among the parts of Pakistan being transformed by China Pakistan Economic Corridor (CPEC) are some of the least developed regions in Balochistan and Sindh, specifically Gwadar and Thar Desert. Here is more on these regions:

Gwadar Port City:

Gwadar is booming. It's being called the next Shenzhen by some and the next Hong Kong by others as an emerging new port city in the region to rival Dubai. Land prices in Gwadar are skyrocketing, according to media reports. Gwadar Airport air traffic growth of 73% was the fastest of all airports in Pakistan where overall air traffic grew by 23% last year, according to Anna Aero publication.  A new international airport is now being built in Gwadar to handle soaring passenger and cargo traffic.

In addition to building a major seaport that will eventually handle 300-400 million tons of cargo in a year, China has built a school, sent doctors and pledged about $500 million in grants for an airport, hospital, college and badly-needed water supply infrastructure for Gwadar, according to Reuters.

400 Km Long Kachhi Canal From Punjab to Balochistan

The Chinese grants include $230 million for a new international airport in Gwadar, one of the largest such disbursements China has made abroad, according to researchers and Pakistani officials.

New development work in Gwadar is expected to create as many as 20,000 jobs for the local population.

Steel Bridges on Multan-Qila Saifullah Section of Highway N-70 Connecting Punjab and Balochistan. Source: Dawn

Thar Desert:

Thar, one of the least developed regions of Pakistan, is seeing unprecedented development activity in energy and infrastructure projects.  New roads, airports and buildings are being built along with coal mines and power plants as part of China-Pakistan Economic Corridor (CPEC). There are construction workers and machinery visible everywhere in the desert. Among the key beneficiaries of this boom are Thari Hindu women who are being employed by Sindh Engro Coal Mining Company (SECMC) as part of the plan to employ locals. Highlighted in recent news reports are two Hindu women in particular: Kiran Sadhwani, an engineer and Gulaban, a truck driver.

Kiran Sadhwani, a Thari Hindu Woman Engineer. Source: Express Tribune

Thar Population:

The region has a population of 1.6 million. Most of the residents are cattle herders. Majority of them are Hindus.  The area is home to 7 million cows, goats, sheep and camel. It provides more than half of the milk, meat and leather requirement of the province. Many residents live in poverty. They are vulnerable to recurring droughts.  About a quarter of them live where the coal mines are being developed, according to a report in The Wire.

Hindu Woman Truck Driver in Thar, Pakistan. Source: Reuters

Some of them are now being employed in development projects.  A recent report talked of an underground coal gasification pilot project near the town of Islamkot where "workers sourced from local communities rested their heads after long-hour shifts".

Hindu Woman Truck Driver in Thar, Pakistan. Source: Reuters 

In the first phase, Sindh Engro Coal Mining Company (SECMC) is relocating 5 villages that are located in block II.  SECMC is paying villagers for their homes and agricultural land.

SECMC’s chief executive officer, Shamsuddin Ahmed Shaikh, says his company "will construct model towns with all basic facilities including schools, healthcare, drinking water and filter plants and also allocate land for livestock grazing,” according to thethirdpole.net He says that the company is paying villagers above market prices for their land – Rs. 185,000 ($ 1,900) per acre.

Summary:

Ex US Ambassador Richard Olson is absolutely right in his assessment that "(CPEC's) magnitude and its transformation of parts of Pakistan dwarf anything the United States has ever undertaken".  Olson goes on to warn the Trump Administration that "Without Pakistani cooperation, our (US) army in Afghanistan risks becoming a beached whale". The "magnitude" of CPEC and its "transformation" that Olson refers to is clearly visible in some of the least developed regions of Pakistan in Balochistan and Sindh provinces.  Gwadar port city and Thar desert are humming with unprecedented development activity fueled by billions of dollars of funds allocated by China and Pakistan.  

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Will Gwadar Grow to Become a Major Metropolis Like Shenzhen?

"We believe Gwadar is following in the footsteps of Shenzhen which represented a historic population rise, from a population of 30,000 in 1980 to 11 million people in 2017. Gwadar is poised to see massive population growth due to incoming industries, and we expect this to be one of the most strategic cities in South Asia." Hao-Yeh Chang,  China Pak Investments Corporation

Gwadar: The Next Shenzhen?

Gwadar is booming. It's being called the next Shenzhen by some and the next Hong Kong by others as an emerging new port city in the region to rival Dubai. Land prices in Gwadar are skyrocketing, according to media reports. Gwadar Airport air traffic growth of 73% was the fastest of all airports in Pakistan where overall air traffic grew by 23% last year, according to Anna Aero publication.  A new international airport is now being built in Gwadar to handle soaring passenger and cargo traffic.

Recent Aerial View of Gwadar Hammerhead Growth

Gwadar Property Boom:

The volume of Gwadar property searches surged 14-fold on Pakistan’s largest real estate database, Zameen.com, between 2014 and 2016, up from a prior rate of a few hundred a month. “It’s like a gold rush,” said Chief Executive Zeeshan Ali Khan to an Express Tribune newspaper reporter. “Anyone who is interested in real estate, be it an investor or a developer, is eyeing Gwadar.”

Chinese private investment company China Pak Investment Corporation has recently announced it is acquiring 3.6 million square foot International Port City project in Gwadar. It plans to develop a $150 million gated community to handle the influx of 500,000 Chinese professionals expected in Gwadar by 2022.

Proposed Gwadar International Airport

China Pak Investment Announcement:

On October 20, 2017, Pakistan's Geo TV news reported that China Pak Investment Company plans to increase its commitment to  invest $500 million in Gwadar in the first phase of a project aimed at building homes for around 500,000 incoming Chinese professionals expected in Gwadar by 2023. An earlier September 29, 2017 press release by China Pak Investment Corporation said as follows:

"The final master plan for China Pak Hills is currently being refined in Hong Kong, and will feature a range of state-of-the-art amenities including an open-air shopping boulevard; indoor shopping mall; restaurants and eateries; an international school and nursery; six community parks; indoor and outdoor sports facilities including tennis courts and a resident's gymnasium; a water desalination plant and recycling centre. China Pak Hills will also be home to the Gwadar Financial District, catering to the growing financial sector and adding much needed A Grade office space to Gwadar's growing market."

Gwadar Port Development:

Gwadar port's planned capacity when it is completed will be 300 to 400 million tons of cargo annually.  It is comparable to the capacity of all of India's ports combined annual capacity of 500 million tons of cargo today.   It is far larger than the 10-12 million tons cargo handling capacity planned for Chabahar.

To put Gwadar's scale in perspective, let's compare it with the largest US port of Long Beach which handles 80 million tons of cargo, about a quarter of what Gwadar will handle upon completion of the project. Gawadar port will be capable of handling the world's largest container ships and massive oil tankers.

Gawadar port is being built in Pakistan by the Chinese as part of the ambitious $46 billion China-Pakistan Economic Corridor (CPEC) that will eventually serve as Hong Kong West for  growing Chinese trade with the Middle East and Europe.  CPEC will also enable Pakistan to bypass Afghanistan to trade with Central Asia through China across China's borders with Tajikistan, Kyrgyzstan and Kazakhstan.

India's Strong Opposition: 

Pakistan suspects that India's real objective in Afghanistan and Iran is to locate its intelligence agents under the cover of Chabahar port construction workers to sabotage China-Pakistan Economic Corridor (CPEC) and support Baloch insurgency to destabilize Pakistan. These suspicions were strengthened when Indian spy Kulbhushan Yadav, operating under the fake name Husain Mubarak Patel, was arrested in Balochistan in March, 2016. Yadav confessed he was operating as an undercover RAW agent from his base in Chabahar, Iran. Indian Prime Minister Narendra Modi has made no secret of his strong opposition to CPEC and his support for Baloch insurgents.

Chinese Commitment to Pakistan: 

Unlike US-Pakistan ties that have been essentially of a transactional nature, Pakistan-China relationship appears to truly strategic.  A recent book "The China Pakistan Axis: Asia's New Geopolitics" by American policy analyst Andrew Small quotes a top Chinese official as saying to his American counterparts that "Pakistan is China's Israel". Earlier, in 2011, some news reports quoted Chinese officials as warning that "any attack on Pakistan would be construed as an attack on China".  Growing Chinese investment commitments in Pakistan now exceed $100 billion, a further indication of the importance China attaches to Pakistan as one of its closest allies.

Summary:

China-Pakistan ties appear to be truly strategic.  The strength of Chinese commitment to Pakistan is increasing with growing investments in China-Pakistan Economic Corridor related projects. It is now highly visible in terms of the influx of the Chinese money and citizens into Pakistan. China's actions on the ground reinforce the credibility of Chinese officials' reported quotes describing Pakistan as "China's Israel" and warnings to the United States that "any attack on Pakistan would be construed as an attack on China".

Related Links:

Haq's Musings

Pakistan-China-Russia vs India-Japan-US

Pakistan-China Defense Ties "Irk West"

How Strategic Are China-Pakistan Ties?

Karan Thapar Debunks India's Narrative on Kubhushan Jhadav

China-Pakistan Economic Corridor

Gated Communities in Pakistan

Gwadar vs Chanahar

Travel and Tourism Boom in Pakistan

US-Pakistan Transactional Relationship

Pakistan Army: Chief Backer & Guarantor of CPEC

In July 2016, British newspaper Financial Times report headlined "China urges Pakistan to give army lead role in Silk Road project (CPEC):  Squabbles in Islamabad highlight obstacles to Beijing’s plans for transport and energy corridor" said as follows:

"Frustrated with the slow progress on a sprawling, $46bn infrastructure project stretching from China to south Asia, Beijing is seeking to give Pakistan’s army a lead role.... progress has stalled as the two sides work out how to turn the proposals into concrete projects, said Victor Gao, a former Chinese foreign ministry official, with some blaming Pakistan’s competing ministries"..... “Pakistani politicians have squabbled over the route for the CPEC and this may have made people nervous in Beijing,” said a Pakistan government official. “Pakistan is a noisy place politically while the Chinese are not used to harsh disagreements, especially over such a vital project.”

Chinese Container Ship "Cosco Wellington" at Gwadar Port

Gwadar Port Operational:

In the first week of November 2016, hundreds of containers arrived at Pakistan's Gwadar Port from Western China via CPEC's western land route. These containers were loaded onto "Cosco Wellington", a large Chinese vessel, and the ship departed Gwadar Port on November 13, 2016, for various destinations in Africa, Middle East and Europe.

Prime Minister Nawaz Sharif and General Raheel Sharif at Gwadar Port on Nov 13, 2016

So what is happening behind the scenes? Is the Pakistani military playing a big role in making CPEC a reality? What is the extent of Pakistan Army's participation in executing CPEC-related projects? Let's examine answers to these questions in three parts: Managing squabbling civilians, providing security and projects execution.

Squabbling Civilians:

Pakistan Army Chief General Raheel Sharif is playing a very active behind-the-scenes role in managing the infighting among politicians, ministers and the civil servants. It has been reported that Gen Sharif has been talking to all of the stakeholders regularly to ensure progress on China-Pakistan Economic Corridor projects.

Providing Security:

Various militant groups, including Indian government proxies, are engaged in sabotaging CPEC. While some attacks have been successful, it is believed that the Pakistani military has been able to prevent many more. Thousands of soldiers and hundreds of intelligence officers are believed to be working to manage the security situation all along the western route and in Gwadar.  This is what made the recent pilot run with the trucks convoy reaching Gwadar and operationalizing the port recently.

Projects Execution:

The Pakistan military has thousands of civil, mechanical and electrical engineers with decades of experience in building large infrastructure projects and analysts say the army is well placed to supervise the corridor, according to the Financial Times.

In fact, Pakistan Army's Frontier Works Organization (FWO) is building significant parts of the China-Pakistan Economic Corridor (CPEC). A July 2015 announcement is an illustration of what Frontier Works Organization is doing to advance CPEC:

“The Frontier Works Organization (FWO) has built roads with 502 kilometers length on the western alignment of China Pakistan Economic Corridor (CPEC) to link Gwadar with other parts of the country. The FWO took up the challenge to extend the benefits of Gwadar port to rest of the country by building roads in rugged mountainous terrain and highly inaccessible areas. The gigantic task was undertaken on the directives of Chief of Army Staff General Raheel Sharif."

Army's Strong Commitment:

Army Chief General Raheel Sharif has made his institution's commitment loud and clear by frequent statements on the subject. He has said “We will do everything to make it a success". He is also record as warning that “terrorism is a global issue and warrants global response. The funding of all terrorist organizations has to be checked by all. We are against use of proxies and won’t allow it on our soil".

Summary:

Pakistan Army is playing a crucial role in ensuring progress and completion of China Pakistan Economic Corridor (CPEC) related projects. The army leadership is using all its power and influence with all stakeholders, including politicians and civil servants, as part of this campaign to bring about development of infrastructure and energy to make Pakistan economically successful.

Related Links:

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CPEC to Create Over 2 Million Jobs

Modi's Covert War in Pakistan

ADB Raises Pakistan GDP Growth Forecast

Gwadar as Hong Kong West

China-Pakistan Industrial Corridor

Indian Spy Kulbhushan Yadav's Confession

Ex Indian Spy Documents RAW Successes Against Pakistan

Saleem Safi of GeoTV on Gwadar

Pakistan FDI Soaring with Chinese Money for CPEC

Pakistan Launches $8.2 Billion Railway Upgrade Project

Pakistan government has approved an $ 8.2 billion project to upgrade the 1,872 km Karachi - Peshawar rail track, bridges, tunnels, and culverts, according to International Railway Journal.

The new track will support increased axle load of up to 25 tons, up from 22.8 tons which is now the norm in South Asian countries. The higher axle load capacity will allow heavier freight trains carrying more freight per train for greater trade overland.

China will provide 85% of the financing for the project. It will be done in two phases, with the first due for completion in December 2017 and the second in 2021.

It will be part of an international rail link that will connect Pakistan with China,  Russia, Central Asia and Europe. It will extend south from the city of Kashgar in the Xinjiang Uygur autonomous region in Western China to Pakistan's deep-sea Gwadar Port on the Arabian Sea, according to Zhang Chunlin, director of Xinjiang's regional development and reform commission.

Source: China Daily

A study for the plans for this international rail link was first presented in 2014 at a two-day International Seminar on the Silk Road Economic Belt in Urumqi, Xinjiang's capital, according to China Daily.

"The 1,800-kilometer China-Pakistan railway is planned to also pass through Pakistan's capital of Islamabad and Karachi," Zhang Chunlin said. "Although the cost of constructing the railway is expected to be high due to the hostile environment and complicated geographic conditions, the study of the (international rail link) project has already started," Zhang said. "China and Pakistan will co-fund the railway construction. Building oil and gas pipelines between Gwadar Port and China is also on the agenda," Zhang added.

The Pak-China link announcement was part of the discussion on China's broader effort to revive the historic Silk Route by building three main corridors through southern, central and northern Xinjiang to connect China with Russia, Europe and Pakistan. The Silk Road Economic Belt International seminar which concluded on Friday in Urumqi, Xinjinag was jointly sponsored by the State Council Information Office, China International Publishing Group (CIPG), China Academy of Social Sciences (CASS) and Xinjiang Academy of Social Sciences.

In a 2013 report, China's State-owned Xinhua News Agency articulated China's motivation to expand land trade in addition to building its navy to protect its sea trade. Here's what it said:

“As a global economic power, China has a tremendous number of economic sea lanes to protect. China is justified to develop its military capabilities to safeguard its sovereignty and protect its vast interests around the world."

The Xinhua report has for the first time shed light on China's growing concerns with US pivot to Asia which could threaten China's international trade and its economic lifeline of energy and other natural resources it needs to sustain and grow its economy. This concern has been further reinforced by the following:

1. Frequent US statements to "check" China's rise.  For example, former US Defense Secretary Leon Panetta said in a 2011 address to the Naval Postgraduate School in California: "We try everything we can to cooperate with these rising powers and to work with them, but to make sure at the same time that they do not threaten stability in the world, to be able to project our power, to be able to say to the world that we continue to be a force to be reckoned with." He added that "we continue to confront rising powers in the world - China, India, Brazil, Russia, countries that we need to cooperate with. We need to hopefully work with. But in the end, we also need to make sure do not threaten the stability of the world."

Source: The Guardian

2. Chinese strategists see a long chain of islands from Japan in the north, all the way down to Australia, all United States allies, all potential controlling chokepoints that could  block Chinese sea lanes and cripple its economy, business and industry.

Karakoram Highway-World's Highest Paved International Road at 15000 ft.

Chinese Premier's emphasis on "connectivity and maritime sectors" and "China-Pakistan economic corridor project" is mainly driven by their paranoia about the US intentions to "check China's rise" It is intended to establish greater maritime presence at Gwadar, located close to the strategic Strait of Hormuz, and  to build land routes (motorways, rail links, pipelines)  from the Persian Gulf through Pakistan to Western China. This is China's insurance to continue trade with West Asia and the Middle East in case of hostilities with the United States and its allies in Asia.

Pakistan's Gawadar Port- located 400 Km from the Strait of Hormuz

As to the benefits for Pakistanis, expanded trade and the Chinese investment in "connectivity and maritime sectors" and "China-Pakistan economic corridor project" will help build infrastructure, stimulate Pakistan's economy and create millions of badly needed jobs.

Clearly, China-Pakistan ties have now become much more strategic than the US-Pakistan ties, particularly since 2011 because, as American Journalist Mark Mazzetti of New York Times put it, the  Obama administration's heavy handed policies "turned Pakistan against the United States". A similar view is offered by a former State Department official Vali Nasr in his book "The Dispensable Nation".

Related Links:

Haq's Musings 

Comparison of Chabahar and Gwadar

How Strategic Are Pak-China Ties?

Gwadar as Hong Kong West

China-Pakistan Industrial Corridor

US-Pakistan Ties and New Silk Route

Can Pakistan Say No to US Aid?

Post Cold War Shifting Alliances