CSS 2016 Solved Current Affairs Past Papers | CPEC as Game Changer for the Region
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Question Breakdown
This question has two parts. The first requires a discussion of the prospects and challenges associated with the construction of CPEC, while the second part requires an explanation of how CPEC will be a game changer for the region.
Outline
1-Introduction
2-China-Pakistan Economic Corridor (CPEC): An Overview
3-Prospects attached towards the fulfilment of CPEC
- ✓Economic growth by boosting industrial development in diversified fields
- ✓Infrastructure development to enhance regional connectivity and bilateral trade
- ✓Energy security by increasing the country’s power generating capacity and diversifying the energy mix
- ✓Enhancing the geo-strategic significance of Pakistan as a transit trade route for South Asian countries
4-Challenges linked to the construction of CPEC
- ✓Security concerns owing to terrorism and insurgencies at the national front
- ✓Geo-political tensions aiming to intensify regional instability
5-Factors delineating CPEC as a regional game changer
- ✓Economic up gradation of the region via trade liberalization and cooperation
- ✓Revamping regional power dynamics in South Asia through enhanced regional connectivity
6-Critical analysis
7-Conclusion
Answer to the Question
Introduction
Developing countries sought to engage in bilateral and multilateral projects to economically and socially uplift their respective regions. Taking into account, China unveiled the China-Pakistan Economic Corridor (CPEC) in 2013 as a flagship project under China’s Belt and Road Initiative (BRI). Undeniably, the economic corridor between the two Iron Brothers aims to promote bilateral trade, regional connectivity, logistics, and people-to-people interaction through a wider network of roads, railways, pipelines, and ports, primarily joining Gwadar Port in Pakistan to China’s Xinjiang region. Moreover, CPEC presents numerous opportunities for Pakistan in terms of economic growth, infrastructure development, and energy security. Likewise, it emerges as a transformative project for the country, enhancing its geostrategic position in the South Asian region. However, challenges to the construction of CPEC stand still in terms of security concerns and geopolitical tensions at both national and international fronts. Nonetheless, CPEC holds the potential to be a regional game changer in upgrading the region’s economy, shifting the balance of power, and enhancing regional connectivity and cooperation. Therefore, China needs to play a proactive role in diplomatically engaging with regional entities. Likewise, it mounts pressure on Pakistan to adopt a balanced approach in resolving the challenges hindering the full benefits of CPEC.
China-Pakistan Economic Corridor (CPEC): An Overview
The China-Pakistan Economic Corridor (CPEC) is a framework for economic development and regional connectivity that focuses on enhancing business, trade, cooperation, and cultural exchanges, presenting a win-win model for both countries. It dates back to 2013, when Chinese President Xi Jinping announced the Silk Road Economic Belt, including CPEC, as its flagship project. Later, in April 2015, the Chinese president visited Pakistan, and the two countries joined hands to form a transformative economic corridor. The geo-economic corridor was divided into three phases, as shown below:
| Short-term phase (2015-2020) | Early Harvest Projects (EHPs), including energy projects and infrastructure development |
| Medium-term phase (2020-2025) | Focuses on establishing industrial parks and special economic zones (SEZs) |
| Long-term phase (2025-2030) | Aims to develop railway infrastructure, promote tourism and human resource cooperation |
Apart from economic and infrastructure development, CPEC extends cooperation across multiple disciplines, including agriculture, energy, industry, science and technology, and transportation. Initially valued at $ 46 billion USD, the wide range of projects under the CPEC umbrella is estimated to be more than $ 60 billion USD. In July 2023, Islamabad commemorated the 10th anniversary of the signing of the CPEC agreement, highlighting the vision and potential of the project. Likewise, Pakistan acknowledges the role of CPEC in reshaping the country’s socioeconomic landscape and looks forward to a strengthened partnership to ensure long-term success.
Prospects attached towards the fulfilment of CPEC
- Economic growth by boosting industrial development in diversified fields
First, the underlying aspect of CPEC is to boost industrial development in Pakistan, thereby improving its economic standing. Nonetheless, a high-growth economy is vital for the smooth and sustainable functioning of a multi-billion-dollar project. To articulate that, CPEC introduced Special Economic Zones (SEZ’s) in Sindh, Balochistan, Khyber Pakhtunkhwa, and Punjab as Dhabeji SEZ, Bostan SEZ, Rashakai SEZ, and Allama Iqbal Industrial City respectively with prime focus on textile industry, pharmaceuticals, agro, construction goods, information technology, automotive manufacturing, and chemical production. Likewise, developing Gwadar Port as a major industrial hub lies in a similar domain, enhancing Pakistan’s export potential. Moreover, increased industrial activity also promises foreign investment inflows and job creation, putting the country on a path of substantial economic growth.
- Infrastructure development to enhance regional connectivity and bilateral trade
Second, infrastructure development finds key importance in the construction and expansion of CPEC. Specifically, the development of transport infrastructure, including highways, railways, ports, and aviation, ensures effective and integrated corridors to boost regional connectivity and bilateral trade. For instance, the Peshawar-Karachi Motorway, the Orange Line Metro Train in Lahore, and the cross-border optical fiber cable (Khunjerab-Rawalpindi) are among the significant milestones achieved by CPEC. Moreover, under-construction, in-pipeline, and long-term projects collectively aim to facilitate business, trade, and personnel exchanges between China and Pakistan. Likewise, the construction and development of Gwadar Smart Port City, Gwadar International Airport, and East Bay Expressway is to transform the economic landscape of the region, connecting it with regional counties, Europe, and Africa. Thus, the widespread infrastructure development under CPEC would not only uplift social and economic progress in Pakistan but also connect it with regional entities and global business ventures.
- Energy security by increasing the country’s power generating capacity and diversifying the energy mix
Third, an uninterrupted energy supply is mandatory for attaining the socio-economic benefits of CPEC. To address Pakistan’s long-standing energy shortages, CPEC has emphasized increasing its power generation capacity to approximately 10,400 megawatts through diversified energy sources, including nuclear, wind, thermal, coal, and solar. For instance, Sahiwal Coal-fired Power Plant (1320 MW), Quaid-e-Azam Solar Park (1000 MW), and Suki Kinari Hydropower Project (884 MW) are leading examples of CPEC energy projects. Likewise, CPEC is also utilizing the potential indigenous coal reserves in Thar to supply electricity to the national grid. Nonetheless, the well-planned, vast network of power plants and energy generation initiatives in CPEC aims to alleviate Pakistan’s chronic energy shortages. Moreover, upgrading existing grid stations and transmission lines is also a focus for providing efficient energy distribution and boosting economic development in the country.
- Enhancing the geo-strategic significance of Pakistan as a transit trade route for South Asian countries
Fourth, the Belt and Road Initiative intends to build an economic belt along the Silk Road and Maritime Silk Road. CPEC, being a flagship project of the BRI, would significantly amplify Pakistan’s geo-strategic significance by connecting it with 64 countries in Asia, Africa, and Europe. Chiefly, Gwadar’s deep-sea port, with a planned capacity of 400 million tons of cargo per year by 2045, as per the China Overseas Port Holding Company (COPHC), is expected to become a regional hub for major trade and economic activities. Moreover, the country provides the closest oceanic path to landlocked Central Asian Republicans. Additionally, Pakistan becomes a key transit trade point for China and other regions in the wake of the Malacca Dilemma as it provides a land route to the Arabian Sea. Thus, the geo-strategic positioning of the country could lead to increased geo-economic cooperation with countries along the BRI route.
Challenges linked to the construction of CPEC
- Security concerns owing to terrorism and insurgencies at the national front
At the national front, CPEC confronts security concerns in the form of opposition, terrorism, and insurgencies. The feelings of isolation and alienation in tribal communities of GB, KPK, and Balochistan fueled by militant and ethno-political groups turn youth and locals into radicals and extremists, creating a climate of fear and uncertainty for a million-dollar project to be formulated effectively. Taking into account the March 2024 attack in Shangla, the Dasu Bus Attack in 2021, and the 2022 attack on Karachi University’s Confucius Institute, the scale of the vulnerability of Chinese engineers and working personnel in Pakistan is evident. Significantly, local terrorist groups such as TTP, Balochistan Liberation Army (BLA), Lashkar-e-Jhangvi, etc. continue to raise violence against the CPEC projects, hampering the construction efforts. Above all, the deteriorated security situation, political instability, and economic disruptions pose questions for Pakistan’s inefficient management to safeguard mutual interest between the two countries. Likewise, it would adversely impact the cordial relations between the Iron brothers, which are needed to accomplish the economic corridor.
- Geo-political tensions aiming to intensify regional instability
At the international level, multidimensional concerns from regional players surround CPEC, giving rise to geopolitical tensions. Iran views CPEC and Gwadar Port as an economic threat to the Chabahar Port, which is part of a counterbalancing trilateral agreement among Iran, India, and Afghanistan. India considers the CPEC a potential threat to China’s hegemony in South Asia and the Indian Ocean. In 2017, Indian Prime Minister, Narendra Modi, expressed his concerns over the CPEC during his visit to China. Moreover, India’s close engagement with the US, Russia, and the Middle East after the introduction of CPEC elucidates its efforts to limit Pakistan’s sphere of influence in the region. Afghanistan represents a permanent security threat to hamper CPEC projects due to the presence of global terrorist groups (TTP, ISIS, ISK-P, Al-Qaeda) and their close alignment with the Taliban in Pakistan. The US opposes CPEC in order to maintain its dominance in the South Asian Region and the Indian Ocean, which would be compromised by growing Chinese influence. In short, Pakistan needs a balanced approach to overcome geo-political tensions and maintain peace for long-term economic development.
Factors delineating CPEC as a regional game changer
- Economic upgradation of the region via trade liberalization and cooperation
First, the notion of CPEC as a regional game-changer intensifies upon examining its vast range of economic benefits for South Asian countries. The scalability of CPEC development projects opens up vast opportunities for cooperation in multiple domains, including industry, science and technology, agriculture, and information technology. Specifically, SEZs provide regional and foreign investors with all the necessary facilities and optimal conditions to invest in businesses and trade, offering regionally competitive incentives, including a 10-year income tax exemption and exemption from customs duty on the import of capital goods. The Dutch multinational company Akzo Nobel, the British company Strong Stich, and the German Company Alptak Limited are investing in the Allama Iqbal Industrial City, which are active examples in this realm. Moreover, Gwadar Port plays a crucial role in driving economic globalization in the South Asian region by significantly enhancing economic prosperity through seaborne trade and the shipping industry.
Revamping regional power dynamics in South Asia through enhanced regional connectivity
Undeniably, Pakistan, with its unique strategic position in South Asia, has remained a hub of great power politics. However, CPEC makes Pakistan an integral gateway for broader regional integration by connecting Central Asia, South Asia, and the Middle East. Likewise, CPEC, with its long-standing development projects, is viewed as revamping the economic and political power dynamics of historically conflict-prone regions. The Chinese String of Pearls strategy, which involves expanding its military bases and political influence in the Indian Ocean, is a clear example of reshaping regional power dynamics. In addition, CPEC also fosters a balanced environment for the two nuclear powers of South Asia, Pakistan and India, to maintain peaceful and cordial relations in pursuit of their strategic objectives.
Critical analysis
Critically, CPEC is a transformative project that will benefit Pakistan economically, politically, and strategically, offering a vast array of opportunities. Furthermore, CPEC opens up equal opportunities for the South Asian Region to grow economically to significant levels while ensuring regional integration and stability. However, it also raises questions about the competency of Pakistani institutions in managing the huge, multi-billion-dollar collaboration and maintaining a long-term shared future together. Similarly, it pressures China to counter geo-political tensions in South Asia by reshaping regional alliances and power dynamics. In short, both countries must focus on sustainable practices to fulfil their goals for CPEC to be a prominent regional game changer.
Conclusion
To cap it all, CPEC is of substantial importance to both Pakistan and China, as it provides a mutually beneficial model for the two countries. The leading prospects linked with Pakistan include economic growth, infrastructure development, energy security, and geo-strategic importance. Contrarily, the extent of challenges regarding security concerns and geo-political tensions undermines the ecology of the regional economic corridor. Despite the abovementioned challenges, CPEC has the potential to be a regional game changer by economically upgrading and revamping power dynamics in the South Asian Region. Thus, the vision of the economic corridor is to create a connected, stable, and prosperous region for the smooth cultivation of trade and businesses from around the world.
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