Challenges and opportunities of CPEC

Since China Pakistan economic corridor (CPEC) is launched in 2013, it has been facing both challenges and opportunities. The challenges that stand as stumbling block in the way of CPEC can be divided into two wide categories namely “external and internal challenges.” However, the opportunities surpass the challenges. It is, therefore, the projects under CPEC have been heading towards successful completion. Challenges and opportunities of CPEC are discussed in details as follows:

Challenges of CPEC:

CPEC is facing two types of challenges^__ external and internal challenges.

External Challenges:

The following are the external challenges:

Challenge from India:

India is the only important country in South Asia that has avowedly rejected CPEC by claiming that its passes from the disputed territory of Kashmir. India has not only discarded it, but has taken measures to fail the project. For instance, it has been supporting the militants of Baluchistan Liberation Army (BLA) to wreak havoc in the province by imparting them training in the bases located at Pak-Afghanistan border. Besides, Indian RAW agents are actively engaged in Baluchistan as evident in the arrest of Kulbhushan Jadhav. He accepted to be involved in subversive activities to fail CPEC. Thus, India acts as the biggest challenge for CPEC.

Chabahar Port:

Another external challenge faced by CPEC is in the form of Chabahar port because it is the only port in the region that offers an alternative corridor to Central Asian Republics (CARs), Afghanistan and China to reach Arabian Sea via Iran. India has already signed billions of dollars investment with Tehran aimed at diminishing the influence of CPEC. Besides, Iran is relatively peaceful country with better governance structure as compared to Pakistan. It is also one of the largest producers of oil. These characteristics of Tehran will also attract the regional countries to use Iranian corridor instead of Pakistan. Hence, Iran provides an alternative of CPEC through its transit route and Chabahar port that is a great challenge for CPEC.

Hybrid Warfare:

The biggest challenge appears in the form of Hybrid Warfare. It involves the circulation of fake news and propaganda against any project to turn the attention of local people against it. CPEC is also a victim of Hybrid warfare. For instances, the news was circulated in different media platforms that it will be another “East India Company.” Moreover, Alice Well, an American diplomat, cautioned Pakistan that it would push the country deeper into debt trap. Undoubtedly, these remarks are baseless and aimed at containing the growing influence of the project by targeting the narratives of Pakistani citizens, but CPEC faces this daunting challenge of propaganda to a larger extent.

External terrorism:

Pakistan has been the target of external terrorism from Afghanistan. The militants of Tehreek-e-Taliban Pakistan (TTP), Baluchistan Liberation Army (BLA) and so on, operating from Afghanistan has a record of carrying out terrorist attacks against Islamabad. Unless Afghanistan issue is resolved, peace in Pakistan will be a distant dream because the type of terrain makes the fencing of the border very difficult. As such, the cross border terrorist attacks inside Pakistan from Afghanistan threaten the development of CPEC.

Internal Challenges:

The internal challenges faced by CPEC are given as below:

Challenge from Baluchistan:

Not all, but some residents, worth considering, of Baluchistan have shown their reservations against CPEC. The local Baloch people fear that they will be turned into minority in their own province after the influx of workers from other territories. Their intimidation is further exaggerated by the fact that they turned into minority in Quetta^__ the capital of the province^__ after the influx of Pathan during Soviet invasion of Afghanistan in 1979. Besides, they have apprehension that their natural resources will be exploited by China without providing their province an adequate share. The provincial and federal government have done little to appease their emotions. Thus, Baluchistan, the key province for CPEC because of its Gwadar port, will continue act as a challenge, unless the concerns of local people are addressed.

Challenge from Khyber Pakhtunkhwa:

The people of KPK are against the changing of route by the federal government. They, now, believe that CPEC is more beneficial for Punjab alone. Besides, they want the completion of Western route first that passes from KPK to Baluchistan and finally connects Gwadar with China. The Federal government of Pakistan under Prime Minister Nawaz Sharif made the changing in the route, which was disliked by the residents of KPK. It is imperative to solve the reservations of all provinces to make the project a success story.

Poor governance:

Among others, the biggest challenge that stands in the way of CPEC is, of course, the poor governance of Pakistan. To pass any project from different governmental obligations is very time consuming in Pakistan. For instances, obtaining building permit, getting goods passed from customs, paying taxes to Federal Board of Revenue (FBR), getting an electricity connection and so on, is very complex procedure and cannot be done without paying extra money as a bribe to the authorities concerned. Chinese are not happy with the colonial governance structure of Pakistan.

Unless governance is improved, CPEC will never prove to be a game-changer for Pakistan. For instances, the British also spent a large sum of money in the sub-continent including what is now Pakistan for the construction of canals, roads, railways, barrages, dams among others. If compared with the value of investment with today’s currency, the amount would be more than $56 billion.

No doubt, the investment proved beneficial. For examples, construction of dams, barrages and canal brought more land under cultivation. Construction of roads and railways made it easy for the goods and people to move faster.

Where we stand now? Half of our population is illiterate. Around 23 per cent people live below poverty line and the citizens do not have access to clean drinking water. Besides, the country lacks proper health care system. It was because of poor governance and CPEC also encounters the same challenge.

Internal security issues:

Apart from external elements like TTP, Pakistan is also facing security issues from indigenous militant groups. After the series of military operations, the threat has been declined, but not eliminated completely. Still, Pakistan needs to provide security guards to the Chinese workers for their safety.

Pakistan has formed a special security division for CPEC. Annually, it spends around Rs 136 billion on its security. The division has deployed 9000 army personnel and 6000 civil arms forces. Chinese are still not happy with the security. The challenge is that for how long Pakistan will spend this huge amount on the security of CPEC.

Opportunities of CPEC:

In order to understand the opportunities of CPEC, it must be kept in the mid that it is not just a network of roads that connects China with Gwadar, but also involves the investment in different sectors including agriculture, energy and so on. The opportunities of CPEC are given below:

Flourishing of Agriculture sector:

Pakistan is an agrarian country. Agriculture contributes 18.5 per cent to country’s Gross Domestic Product (GDP), employs 38.5 per cent people to national labour force and is total 70 per cent of the export.

CPEC will prove blessing for this sector in many ways: firstly, Chinese enterprises, under CPEC, will install factories to produce hybrid seeds in accordance with the climatic condition of Pakistan to increase crop yield. Undoubtedly, the seed plays an important for increasing overall agriculture output. Besides, the enterprises will develop high quality fertilizers, pesticides and vaccines for the crops.

Secondly, they will set-up food-processing plants to make juices, jams and other industrial products from raw fruits like mangoes. It will also increase the export of Pakistan and add value to the existing raw agricultural products.

Thirdly, to save vegetables from being perished, China will develop cold storage facilities and logistics. At present, almost 50 per cent perishable food is wasted in the transportation including vegetables, fruits, meat and fish. One cold storage facility will be installed in Sukkur as well.

Fourthly, China will bring with them scientific know-how for livestock breeding. Already Pakistan is 4^th largest producer of milk. The scientific breeding will further increase the contribution of livestock in our GDP and improve the living standard of rural people.

Finally, under CPEC, china will update the irrigation system and introduce the drip irrigation to conserve water and bring more land under cultivation.

Industrialization of Pakistan:

Pakistan will undergo a very important journey towards industrialization because of CPEC. According to the master plan of CPEC, the industries, to be set-up by China, will be divided into three categories based on their location namely Western, Central and Southern.

Western route of CPEC is comprised of KPK and Baluchistan. Since these regions are rich in mineral resources like chrome, gold, copper, marble and granite, the mineral extraction industries will be set up. The entire focus of China is on the marble and according to estimation; China will install 12 marble and granite processing industries. This will lead to the exploitation of untapped resources of Pakistan and create job opportunities. Currently, China is Pakistan’s largest buyer of marble at the rate of 80000-tons/ year.

Central route that is consist of Punjab and Sindh is marked for textiles, household appliances and cement industries. In textile, China has shown interest in making only yarn from cotton. Since Pakistan possesses raw material for cement production, different cement industries will be constructed near sources of raw materials.

Southern zone is comprised of Karachi and Gwadar. China has shown interest in Steel, chemical, automobiles and mechanics industries owing to its proximity to Karachi and Gwadar port.

Overcoming energy crisis:

Pakistan was facing a very serious energy crisis before 2013. It was, therefore, around $34 billion, equivalent to 70 percent of the early CPEC funding, was allocated to energy projects alone. It is estimated that by 2025, load shedding in Pakistan will be eliminated and it would be because of CPEC energy projects.

The uninterrupted supply of electricity will help flourish the local industries and boost their capacity to improve overall export of the country.

Job opportunities:

The investment of China under CPEC in different projects will create job opportunities for Pakistani citizens. For instances, the industries will require local labour. The construction of roads has already employed thousands of native civil engineers. The increase in flow of goods from China to Gwadar will require the installation of petrol pumps and restaurants along the route. The transportation sector will also require more work force.

Already, CPEC has employed 75000 Pakistani workers and 2.3 million new jobs are to be created by 2030.

Fiber optics and Surveillance:

China will lay down the network of fiber optics cables in Pakistan for fast Internet as well as cultural integration between two countries. Moreover, it will expand its telecommunication network towards Africa and Europe.

A full system of monitoring and surveillance will also be set up in different cities of Pakistan for security purpose with 24 hours recording. China has already installed around 200 million CCTV cameras in its different cities and remains successful.

Unified market:

CPEC will create a unified market with Pakistan to be the main hub of trade activities. Pakistan provides the shortest transit route to the Central Asian Republics (CARs), Afghanistan and China to reach Arabia Sea for trade activities. China is the world’s largest trading nation and CPEC will push it to move its goods through Pakistan’s transit route instead of its traditional route of South China Sea, which is not only time consuming, but also unsafe. CARs are also rich in natural resources and want to sell their surplus energy. Pakistan also provides them the shortest route to reach the Sea. Same is the case with Afghanistan. It is a landlocked country and can be accessed to the sea through Pakistan. As a result, the entire goods from CARs, China and Afghanistan will be collected in Gwadar to be shipped in other destinations. It will unify the market of these countries.

The unification of market will create an opportunity for Pakistan, in particularly the farmers living in the rural areas, to sell their agricultural products directly at good rate. At present, they find it difficult to get a good market and price.

Tourism and Recreation:

The entire sea belt from Keti Bandar, Sindh to Iranian border will be developed under CPEC by constructing spring hotels, spas, public and recreation parks. The master plan of CPEC also includes the development of wild life sanctuary and Biological Park at Keti Bunder. In Gwadar particularly, the plan talks about international cruise clubs that provide tourisms with rooms as if they were living inside ocean.

Peace in the region:

CPEC is a minor part of a wider Belt and road initiative (BRI) of China. The BRI vision aims at connecting Asian, European and African countries with the network of roads and sea routes. The vision cannot be succeeded without achieving regional peace. It is therefore, China will strive hard to bring peace in the region in two ways: First, it will arrange political settlement of the issues in the regional countries like Afghanistan. Second, it will bring huge investment in the under developing countries to improve the lifestyle of the indigenous people. Once the citizens are engaged in trade activities, they will avoid taking any measure that could harm their economic activities.  Thus, China will promote peace in the region including Pakistan.

Conclusion:

Thus, CPEC encounters both challenges and opportunities. Challenges of CPEC range from Indian opposition, development of Chabahar port as an alternative, hybrid warfare against it, external and internal security threats, reservations of the people of Baluchistan and KPK to poor governance. The opportunities involve the flourishing of the agricultural sector, increase in the industrialization process, overcoming of the energy crisis, creating of the job opportunities, installment of the fiber optics and surveillance system, forming of the unified market, enhancing of the tourism and bringing of regional peace. The federal government must ensure the successful completion of projects under CPEC, as they are beneficial for the country.