The Mutually Beneficial Partnership: CPEC's Advantages for Both China and Pakistan

Unlocking Prosperity, Connectivity, and Security Along the China-Pakistan Economic Corridor

The Mutually Beneficial Partnership: CPEC's Advantages for Both China and Pakistan


Gwadar Port stands as the linchpin of a grand endeavor, serving as the gateway to South West and Central Asia. Its strategic importance stretches from the Persian Gulf through the Indian Ocean to South East Asia and the Far East. Nearly 35 to 40% of seaborne oil shipments traverse the Strait of Hormuz, and Gwadar, strategically located at the crossroads of three sub-regional systems, plays a pivotal role in facilitating the transportation of this vital energy source. Consequently, it holds a fundamental role in the future economic prospects of around 20 countries across Central Asia, South Asia, and China, by offering an economically viable, cost-effective, and shorter route for transit and supply. The Corridor will substantially reduce the distance between Europe and Western China, resulting in significant time and cost savings, amounting to billions of dollars annually.

Strategic & Economic Benefits for Pakistan & China:
The China-Pakistan Economic Corridor (CPEC) is a compelling illustration of the convergence of geostrategic and geoeconomic interests between these two nations, rooted in a long history of socio-economic and diplomatic relations. This partnership not only bolsters the economic interests of both countries but also fosters the development of mutually beneficial infrastructure, further solidifying their efforts to counter shared adversaries. Anticipated advantages and gains for both sides include:

(i) Facilitating economic development in the relatively underdeveloped western regions, particularly Xinjiang, which will contribute to peace and stability and enhance trade with Central Asia to meet growing energy demands.
(ii) Providing China with the shortest access to markets in Asia, Europe, and beyond, with Gwadar Port serving as a conduit for trade from the Persian Gulf and Africa to Western and Northern China, significantly reducing distances and cutting costs.
(iii) Reducing transportation time for China's oil imports from the Middle East and Africa from over 30 days to just 2 days through pipeline projects, reducing dependence on shipping routes through the Strait of Malacca and other vulnerable maritime routes.
(iv) Offering enticing investment opportunities for Chinese investors in various sectors due to lower labor costs in Pakistan.
(v) Aligning with Pakistan's security paradigm and "Look East" policy, CPEC strengthens the strategic partnership.
(vi) Gwadar Port, located at the crossroads of vast markets, can play a vital role in Pakistan's economic revival when fully functional, connected with China and Central Asia.
(vii) Opening avenues for socio-economic development in Gilgit-Baltistan and Balochistan Province.
(viii) Attracting Chinese investment for infrastructure development and energy projects to address Pakistan's energy deficit, positioning Pakistan as a regional trade hub and energy corridor, generating substantial transit revenues and employment opportunities.
(ix) Projected potential revenues of over 100 billion dollars per year in transit revenue in the long term, along with hundreds of thousands of employment opportunities.
(x) Recognizing the significance of sea trade for Pakistan's economy, the development of Gwadar Port and its connectivity is vital to reduce the burden on Karachi and Bin Qasim ports and further enhance Pakistan's maritime trade.

Crucial Priorities for Pakistan:

Recognizing the immense potential, it is imperative to focus on key areas to maximize this opportunity for sustainable economic development and secure our socio-economic future. These priorities include:

(a) Enhancing regional connectivity by linking major ports to trade routes through highways, railways, and oil pipelines.
(b) Developing a world-class and efficient logistics chain, alongside infrastructure and trade facilitation.
(c) Establishing special economic and industrial zones and transit facilities along the Corridor.
(d) Expanding oil storage facilities connected through pipelines.
(e) Advancing water and hydro-power development, including the construction of mega dams on the Indus Cascade, in addition to medium-sized hydropower projects.
(f) Exploring and exploiting mineral resources to fund the economic program.
(g) Lastly, but not the least, investing in the development of a skilled and proficient human resource.

In Conclusion:
CPEC stands as a mutually beneficial collaboration that promises advantages not only for both participating nations but also for the entire region. It presents a rare and promising opportunity for Pakistan to unlock its true strategic and economic potential. This is undoubtedly a colossal undertaking, one that requires the active participation of the private sector and financial institutions to ensure its swift and successful implementation.