Iron Brothers: Assessing the China-Pakistan Economic Corridor

Formal relations between Pakistan and China date back to 1950 when Pakistan became one of the first countries to recognise the People’s Republic of China.

The following report was originally submitted as part of my A-level EPQ and was completed in February 2020. As such some of the information may be outdated. Regardless, I hope it proves informative for anyone who is interested in Sino-Pak relations.


The Spatial Layout of CPEC

The China-Pakistan Economic Corridor, most commonly known as CPEC, is perhaps one of the world’s largest infrastructure overhauls seen in the last decade. It is comprised of 70 projects[1], ranging from coal-fired power plants to fibre optic cables, and is currently worth over $62 billion in Chinese investment[2].

CPEC is the flagship for China’s Belt and Road Initiative (BRI), a global development strategy similar to that of the US Marshall Plan. It marks the beginning of a new venture in Sino-Pak relations which already has a strong military and political base. The aim: to ensure sustained economic growth for both Pakistan and China’s western region of Xinjiang.

However, the question must be asked: Is CPEC good for Pakistan?

By this, I mean, is CPEC good for Pakistan economically and politically? This is an important question considering Pakistan’s history of being a client state to foreign powers such as the US and Saudi Arabia. These relationships have plunged Pakistan into over $82.19 billion of external debt, with 29.5% of its population below the poverty line[3].

In addition, Pakistan’s involvement in the US War on Terror claimed the lives of over 23,375 Pakistani civilians[4] while leaving the country with several terrorist organisations to deal with. Meanwhile, corrupt Pakistani officials hoard money in overseas bank accounts while the poor suffer from a crippling economy. It is no wonder why we should be concerned with the recent developments concerning Pakistan’s newfound love for China.

Will CPEC break or reinforce the status quo?

That being said, CPEC doesn’t just affect Pakistan; it could have implications for the whole world. Pakistan is located in one of the world’s most strategically important locations. The Indus River has always been the crossroads between civilisations, even being one of the cradles of civilisation itself, and ruled by great powers such as the Achaemenid Empire, Alexander’s Macedonian Empire, the Mongols, the Mughals and, most recently, the British Raj.

Today, Pakistan borders two of the world’s fastest-growing economies: India and China, not to mention the oil-rich Middle East and mineral-rich Afghanistan. With the Strait of Hormuz only 600km from Gwadar port and direct access to the Arabian Sea, Pakistan will undoubtedly play a crucial role in the global economy with the help of CPEC.

What does CPEC mean for the BRI? And what does the BRI mean for the world and its future?

In this essay, I aim to answer these questions as well as highlight the necessary steps that I believe Pakistan should take to ensure that they can get the most out of CPEC.


CPEC Projects


Are SEZs good for Pakistan?

Location of CPEC SEZs

CPEC is going to see many changes to the Pakistani economy. In particular, under CPEC, Pakistan will see the introduction of new Special Economic Zones (SEZs), areas in which the business and trade laws are different from the rest of the country.

China is helping Pakistan establish a total of 9 SEZs[5] , which will most likely be based on the Chinese model for SEZs such as Shenzhen in the Guangdong province and Kashgar in Xinjiang. Chinese SEZs give special tax incentives for foreign investment and have greater independence from the central government on international trade activities. These SEZs are export-oriented and primarily driven by market forces. Furthermore, they are listed separately in national planning and retain the authority to pass legislation. This gives SEZs the same power as provincial-level administrations when it comes to economic policy.

Proponents of CPEC put forward the idea that these SEZs will bring about economic growth by liberalising the Pakistani economy via increased exports and foreign direct investment.

 ‘If there is one proposition with which virtually all economists agree, it is that free trade is almost always better than protection.’[6]

This is based on the theory of comparative advantage (a country’s ability to produce goods and services at a lower opportunity cost than that of its trade partners). In short, by liberalising the Pakistani economy, Pakistan will be better off. This is because it will naturally force Pakistan to specialise in whichever industries it has a comparative advantage, such as raw cotton. Overall, this would increase Pakistan’s output in those industries, leading to increased exports and economic growth as a result.

Pakistan would then be obligated to increase trade in whichever industries it lacks a comparative advantage, such as dairy products. This will allow other countries to specialise in whichever industries they have a comparative advantage meanwhile trading with Pakistan in whichever industry they lack a comparative advantage. In theory, this would increase world output and, by extension, economic growth for all countries.

In China, following the establishment of its first SEZs in 1980 and various economic reforms designed to open up the country to global trade, GDP skyrocketed from $191 billion (1980) to $1.2 trillion (2000) and eventually $13.6 trillion (2018)[7]. China is a textbook case study of how market liberalisation can significantly transform a country’s economic position.

If Pakistan learns from China, there is no reason the country would not also achieve long-term economic growth. Furthermore, the CPEC proposed SEZs are said to have the potential to generate over half a million direct jobs and over a million indirect jobs in Pakistan[8].

However, as seen with the case of the Kingston Free Zone in Jamaica, free trade is not always conducive to the betterment of a country’s citizens. Jamaican citizens working in the Kingston Free Zone were forced to work in poor conditions on wages as low as $16.30 a week[9], in the 1980s, at the behest of foreign companies that were not legally required to operate according to government standards.

SEZs across the world have been responsible for the rampant exploitation of workers and loss of government revenue. Other negative socio-economic impacts include suppressing labour rights, preventing trade unionisation, and a lack of environmental standards[10]. It is evident that without proper government regulation, the SEZs proposed by CPEC have the potential to exacerbate already existing problems concerning Pakistani labour. This, in turn, could have serious social and political implications for Pakistan, a country that already has the third-largest number of people trapped in modern-day slavery at 3.19 million after China and India[11].


Will CPEC put an end to Pakistan’s energy insecurity?

One major obstacle to Pakistan’s economic success is the country’s poor energy provision. Pakistan currently ranks 115 out of 137 countries for reliable electricity[12] , with only 70.8% of the country’s population having access to electricity[13], leaving over 52 million people without access[14].

Ultimately, this negatively affects local businesses and the country’s economy as a whole by curbing investment. Private sector investors see the lack of reliable electricity as a potential risk to profit. And rightly so, in 2015 alone, power sector inefficiencies cost the Pakistani economy $18 billion (6.5% of GDP)[15]. Couple this with the associated social implications, such as increased strain on healthcare and lower quality of education, and you have a recipe for disaster.

On the other hand, when you compare this to the rapidly emerging economy of China, where access to electricity is at 100%[16], it is clear to see the importance of a reliable energy supply when it comes to developing a strong economy. By introducing energy reforms, Pakistan could save $8.4 billion in business losses and increase total household incomes by at least $4.8 billion a year[17].

Proponents of CPEC claim that it will “fulfil the electricity demand and ensure the reliability of electricity supply in Pakistan”[18]. After all, CPEC includes a total of 22 projects dedicated to energy generation and supply, which, when combined, offer a power capacity of 12.4 GW[19]. When this is added to Pakistan’s current installed power capacity of 30 GW[20], there will be more than enough energy to overcome Pakistan’s deficit of 5 GW[21]. Therefore, in theory, CPEC will indeed fulfil Pakistan’s energy demands and leave room for demand to increase, which will be crucial to supporting economic growth in the long term.

However, the question remains: does it work in practice?

Of the 22 energy projects, only 8 are fully operational[22] , therefore still leaving a significant energy deficit from lack of power capacity. Furthermore, transmission inefficiencies frequently lead to blackouts across the country. Pakistan’s transmission capacity sits well below the country’s current installed power capacity at 22 GW[23]. This slow progress meant that CPEC did not achieve its 2020 goal of addressing the bottlenecks in the country’s economic and social development[24].

In other words, CPEC has already failed in achieving 100% energy access by its own deadline of 2020. If the country cannot even provide enough electricity for its people, how will it provide enough energy for the second phase of CPEC? Therefore, in practice, CPEC has failed to fulfil its own goals, let alone the electricity demand of Pakistan.

In due course, these projects will be completed. However, if they are to be completed alongside the same timeframe of CPEC’s second and third phase projects, there will be dire consequences for the Pakistani economy. Without sufficient energy provision, Pakistan will have to increase energy imports to complete its second and third phase projects, such as the New Gwadar International Airport, which began construction in October 2019.

This will increase the country’s current account deficit, as seen with the ‘Punjab Speed’ predicament[25]. As a result, the Pakistani rupee will be devalued once again, and annual growth will continue to slow. Pakistan will then seek yet another bailout from the International Monetary Fund (IMF) or the World Bank and other countries like China.

Even if all the energy projects are completed, they will become obsolete over the long term. Of the 12.4 GW provided by CPEC, 8.2 GW are coal-based[26]. The negative impacts of burning coal are widely documented. For a country where four major cities (Peshawar, Islamabad, Lahore and Karachi) have air quality rankings ranging from unhealthy to hazardous[27], is it wise to invest in coal-fired power plants? While coal is more reliable and efficient, it will not last forever.

Once Pakistan exhausts its domestic supply of Thar coal, it will have to begin importing coal from abroad, most likely from China. Pakistan is already dependent on Saudi Arabia and Iran for oil and gas, making up 80% of its energy mix[28]. Add China to the mix, and Pakistan will become even more vulnerable to the influence of foreign powers and the fluctuating prices of fossil fuels. This is ultimately counter-productive to the goal of achieving sustainable long term economic growth for Pakistan.


Is CPEC a debt trap?

Pakistan’s debt crisis has significantly impeded the country’s development.

Another major issue afflicting Pakistan’s economy is the ongoing debt crisis. Since the establishment of CPEC, Pakistan’s total external debt increased from around $60 billion (2013) to over $90 billion (2018)[29]. However, it is important to note CPEC itself did not cause the debt crisis.

As Pakistan accumulates more debt, it means that the country will have to use more money to service debt in the future. Pakistan serviced a total of $7.5 billion in debt, of which $2.3 billion was interest, between 2017 and 2018[30]. Due to the increasing issue of debt servicing, the current account deficit increased from $18 billion (2017) to $21 billion (2018)[31].

Furthermore, due to the interest of such debt having reached a high level, Pakistan has had to borrow more money to repay its obligations. Despite declaring he would rather die than go to the IMF seeking a bailout, Pakistan’s Prime Minister Imran Khan was forced to turn to the IMF for $6 billion in the face of a weak economy, making it the 12th time Pakistan has had to rely on the IMF[32].

Pakistan is in the midst of a perpetual cycle of debt that must be addressed if the country ever wants to see sustainable long term economic growth. Will CPEC exacerbate or relieve the debt crisis?

Proponents of CPEC are often quick to point out the insignificance of Pakistan’s external debt to China. Pakistan’s external debt to China is around $6 billion, less than 6% of Pakistan’s total external debt[33]. In fact, the majority of Pakistan’s external debt is owed to multilateral lenders such as the IMF and the World Bank[34]. However, nobody calls these organisations a ‘debt trap’ despite having plunged many more developing economies into debt than China.

On the contrary, CPEC offers increased trade, allowing the country to pay back its debt in the long term. Pakistan is forecasted to collect between $6 billion to $8 billion from CPEC toll taxes and rental fees, with 4% of China’s total trade ($154 billion according to 2015 figures) passing through CPEC[35]. This is something that other lenders do not offer, making the debt from China less of a burden as CPEC provides the needs to pay it back.

On the other hand, Pakistan is one of 8 countries of particular concern regarding the risk of debt distress[36][37]. Furthermore, China has also been charging Pakistan interest rates as high as 5% compared to the 2% to 2.5% rate given to other BRI countries[38]. Due to the high cost of electricity and transmission losses, Pakistan would also have to pay Chinese companies for electricity that Pakistani distribution companies cannot afford, resulting in a currency crisis as Chinese companies move money outside the country.

In addition, an increase in CPEC related imports combined with decreasing exports, as the Pakistani market is flooded with Chinese products, could push the country further into a currency crisis. Therefore, it is fair to say that while CPEC represents an opportunity for Pakistan to end the debt crisis, it also poses a risk of falling even deeper into it.

There is also the concern that if Pakistan cannot pay back Chinese loans, China may begin seizing assets as it did with Hambantota Port in Sri Lanka[39]. Thereby compromising Pakistan’s sovereignty as well as robbing the country of potential revenue. However, the likelihood of this occurring is very slim.

China’s Debt Renegotiations

A study conducted by the US-based Rhodium Group found that most of China’s debt renegotiations end with the debt being completely written off[40]. Furthermore, China’s long-standing political and military relationship with Pakistan, which saw the joint development of the JF-17 Thunder fighter jet, Al-Khalid tank and Pakistan’s nuclear infrastructure, makes asset seizure all the more unlikely for Pakistan.

If Pakistan can utilise CPEC and policy reforms to increase exports, there is no reason why the debt crisis cannot be solved in the long term. Therefore, the argument that CPEC is a ‘debt trap’ is not entirely fair. CPEC itself did not cause the debt crisis. CPEC itself will not exacerbate the debt crisis. CPEC itself will not even relieve the debt crisis. To pin all the responsibility on CPEC is neither fair nor well grounded. It is, in fact, Pakistan’s own economic policy that will determine whether the country remains in debt, not CPEC.


Does CPEC favour Punjab?

Since Pakistan’s creation in 1947, the country’s politics have been dominated by the Punjab province. Of Pakistan’s 342 seats in the national assembly, 174 seats are reserved for Punjabi politicians on account of Punjab making up the majority of the country’s population. By dominating the lower house of Pakistan’s parliament and contributing to 57% of the country’s GDP[41], Punjab has proven itself to be the most influential province of Pakistan.

This has led to controversies in the past. For example, the proposed Kalabagh Dam has been debated over for the last 40 years. The project is advocated by Punjab-based power brokers but has been opposed by politicians from the country’s smaller provinces, such as Sindh, which sees the project as a threat to its water security.  Therefore, it is a viable concern that CPEC may favour Punjab over the other provinces of Pakistan.

Proponents of CPEC tend to claim that that all Pakistani provinces will benefit equally. Following the 18th amendment to the country’s constitution in 2010, many powers were devolved at the federal level and given to the provinces[42]. It was seen as a step towards democracy as it allowed the smaller provinces greater autonomy from the Punjab dominated centre.

As a result, when it comes to CPEC projects, parliament only provides oversight and is not responsible for coordination and decision-making[43]. It is down to the provinces to plan and execute projects with China.  Therefore, it is argued that the notion that CPEC favours Punjab is a false narrative, and due to the devolved power, all the provinces are effectively in the same boat when it comes to CPEC.

On the other hand, given the history of Punjab’s dominance politically, economically, and socially compared to the rest of Pakistan, Punjab remains the most equipped and desirable province to absorb investment from China. This has led to two major controversies concerning CPEC’s lack of transparency and its alleged favouritism towards Punjab. Despite being resolved, these issues have fuelled an overall distrust of Punjab amongst Pakistan’s other provinces.

The first controversy began in 2014, when politicians from the Khyber Pakhtunkhwa (KP) province began claiming that the CPEC route had been shifted away from KP towards Punjab, thereby excluding the region from Chinese investment[44]. The original route proposed in 2006 passed through the impoverished areas of Balochistan, southern Punjab and central KP, including the provincial capital of Peshawar[45].

Following the rise of the Tehrik-e-Taliban, which grew to threaten most of KP, the route was changed to avoid KP in its entirety. In response, PTI held a dharna aimed at dislodging the PML-N for electoral fraud with the alleged support of a former Inter-Services Intelligence chief[46]. In 2015, politicians staged a walkout from the Senate[47]. To placate critics, the government proposed that CPEC would have three routes (Eastern, Central and Western). By 2017, the issue was resolved[48] . However, should there be another change in government, the debate may resume[49].

The second controversy is centred on the Orange Line in Punjab’s capital of Lahore[50].  When CPEC formally launched in 2015, during Chinese President Xi Jinping’s state visit, the mass transit rail line stood out as a municipal project amongst largely intercity, and interregional connectivity focused projects. This led to an outcry amongst the smaller provinces of Pakistan.

No Pakistani city outside of Punjab’s jurisdiction, save Islamabad, has a mass transit system. Including it as part of CPEC, despite having to be subsidised at $160 million per year to keep fares affordable[51], is a clear example of CPEC’s favouritism towards Punjab. Following the controversy, it was asserted that the Orange Line was not part of CPEC and was instead a bilateral agreement between the Punjab government and China that had been planned four years prior.

It was not until December 2016, following document leaks confirming that the project had been on the CPEC agenda early on, that the Orange Line was formally added to the Planning Commission of Pakistan’s list of CPEC projects[52]. Following this, additional municipal rail projects were finally added in Karachi, Quetta and Peshawar[53] to appease the smaller provinces.


Will Gwadar Port put an end to Baloch separatism?

Balochistan has proven itself to be a difficult province for the Pakistani leadership to handle. The conflict goes back to 1948, when Kalat, a princely state that used to make up most modern-day Balochistan, acceded to Pakistan. The Khan’s brother opposed the move, and since then, multiple insurgencies have been fought against Pakistan. However, it was not until the latest insurgency following disputes between the Rajiha, a subtribe of the Bugti tribe, and the government over natural gas concessions in 2003 that anything near a unified Baloch revolt occurred.

By 2013, the insurgency subsided but is still said to be operational in the Awaran region and Makran coast[54]. With CPEC’s flagship Gwadar port located on the Makran coast, Baloch separatism poses a huge security risk. Will CPEC placate or provoke the Baloch separatists?

Proponents of CPEC put forward the idea that making Gwadar the focal point of the economic corridor will bring about economic growth and social development for the people of Balochistan. Thereby putting an end to Baloch disenfranchisement and, by extension, the broader anti-Pakistan sentiments that fuel Baloch separatism.

Following the 2013 elections, the PML-N had to form a coalition with the Balochistan National Party (BNP). This nationalist party is pro-Pakistan yet wishes to see more autonomy for Balochistan. By maintaining the support of the BNP, the government has been able to move towards more equitable development through CPEC, thereby avoiding an intensified insurgency. Baloch politicians admire China’s ability to rapidly improve its standard of living and see CPEC as a means to uplift the Baloch people if done right[55]. Therefore, Gwadar port is the only solution for the Baloch insurgency.

However, the BNP still echoes the view that Balochistan should have control of its resources. This view shared by Baloch separatists and has been central to the historical struggle in the province.

Balochistan is home to over $1 trillion worth of natural resources; however, despite being so mineral-rich, the region has the lowest human development index (HDI) in the whole of Pakistan[56].  Any income that has ever been generated by these resources has largely been used for the social development of Pakistan’s other provinces, mostly Punjab, rather than the betterment of Balochistan from whence they came.

With this in mind, the BNP has called on the federal government to hand control of Gwadar port over to the Balochistan provincial government[57]. Unfortunately, the port remains in the hands of Chinese Overseas Port Holdings Limited[58]. This could spell disaster for Pakistan. With Gwadar now in the hands of China, resources are bound to leave not just Balochistan but Pakistan as a whole. Therefore, little to any income generated will ever reach the Baloch people. Social development will continue to stagnate, and anti-Pakistan sentiment will worsen.

The nature of CPEC, being interregional connectivity, dictates that resources are bound to leave Balochistan no matter what. To promise that no resources leave the province would be impossible, impractical and counter-productive. Instead, what can be done is to ensure that Balochistan receives a disproportionally high benefit from CPEC projects to help de-escalate the insurgency and improve its low HDI. Unfortunately, this has not been the case.

Take, for example, the Saindak copper mine project. Only 2% of revenue is awarded to the Balochistan province; meanwhile, the Metallurgical Corporation of China receives 50%, and the Pakistani federal government receives the remaining 48%[59]. In addition, the Balochistan Mineral Resources Development Board, formed in 2015 to oversee exploration and mining licenses, is indirectly controlled by the federal government as seven of the nine members are bureaucrats, with only the final two being elected officials[60].

This almost certainly indicates that CPEC has so far continued the status quo. Until more is done to ensure the social development of Balochistan, the insurgency will continue to pose risks to CPEC[61].


Will CPEC improve Pakistan’s foreign relations?

It is almost an unwritten rule that when it comes to Pakistani foreign affairs, one has to mention India and vice versa. The Indo-Pak rivalry is virtually iconic in nature, going back to the establishment of the respective countries as they gained independence from the British, resulting in the largest human migration in history. Over a million people lost their lives, and many more were displaced in what is now known as Partition[62]. Since then, Pakistan and India have fought a total of four wars.

Considering South Asia’s tumultuous history, there is a genuine concern that CPEC may exacerbate the strained – if not dysfunctional – relationship between Pakistan and its much larger, economically superior neighbour.

Proponents of CPEC point towards the fact that CPEC offers the opportunity to foster an economic partnership between India and Pakistan. It is within Chinese interests that as many countries as possible join the BRI as part of the country’s common destiny vision[63] to bring peace and economic balance to the world[64]. China invited India to BRI meetings in both 2017 and 2019[65].

Similarly, Pakistan also wishes for peace with India. Following the flare-up in Indo-Pak tensions during the 2019 Pulwama Attack, which saw cross-border airstrikes carried out by both sides, Pakistan released a captured fighter pilot as a peace gesture[66]. Furthermore, Pakistani Prime Minister Imran Khan expressed his wishes for peace following the victory of the Bharatiya Janata Party in the recent 2019 Indian elections, a wish that was reciprocated by Indian Prime Minister Narendra Modi[67].

Unfortunately, India declined both Chinese invitations[68]. This is part of India’s fear of being encircled by the BRI,[69] thereby being shut out from international trade. As a result, India has been reluctant to join BRI negotiations so far, being critical of Chinese activities in the South China Sea and CPEC on the grounds that it undermines India’s sovereignty claims over Kashmir[70].

In fact, this fear has driven India to exploit the instability in Balochistan by publicly announcing its support for Baloch separatists in 2016 in an attempt to sabotage CPEC[71]. Since then, the Baloch insurgency has been emboldened, leading to an increased number of attacks on Pakistani military personnel as well as CPEC labourers[72].

On the 18th April 2019, Baloch militants blocked the Makran coastal highway and executed 14 members of the Pakistan Armed Forces[73]. This highlights how instead of being used as a tool for peace, CPEC has instead been exploited and used to deepen the Indo-Pak divide.

On the other hand, following India’s brutal lockdown in Kashmir, it was China that brought the issue to the UN Security Council on behalf of Pakistan[74].  This was partly due to the long-standing Sino-Pak relationship but also to protect Chinese interests in Kashmir, namely CPEC. As a result, it could also be argued that CPEC, having brought China and Pakistan closer, has proven itself to serve Pakistani interests on the world stage by bringing important issues into the spotlight. Furthermore, public perception of Pakistan has significantly improved, in no small part due to CPEC, in recent years[75].

 However, at the time of writing, the Kashmir lockdown continues[76] , and Indian Muslims are now at risk of losing their status as Indian citizens[77]. These issues will most certainly lead to more stand-offs between India and Pakistan in the future. CPEC may not solve the many Indo-Pak disputes; however, it has given Pakistan the upper hand in international discourse, that being the support of China.

Nonetheless, it is well known that influence goes both ways, and Sino-Pak relations are no exception. By supporting Pakistan’s stance on the Kashmir dispute, China has effectively bought Pakistan’s silence on the various human rights violations that occur within Chinese borders. As of yet, Pakistan has failed to publicly address China’s ethnic cleansing of Uyghur Muslims in Xinjiang[78], despite jumping at any chance to call out India. Considering the fact that Pakistan was created on the basis of protecting the rights of Muslims and that the country’s close ally, Turkey, has denounced China for its treatment of Muslims[79], this hypocrisy is sure to lead to some political complications in the future.


Conclusion

In conclusion, it is clear to see that CPEC does indeed have the potential to revolutionise Pakistan. Not just economically but socially and politically as well. However, as highlighted, more needs to be done by Pakistan to ensure that it can capitalise on this opportunity. Pakistan must ensure that it does not fall into the many pitfalls of large investment packages, such as CPEC, which many other developing countries often fall into. It is also important to remember that CPEC will not change the status quo on its own and needs the necessary policy changes to be truly effective. As such, I have decided to summarise the key steps that I believe need to be taken to ensure that CPEC yields the greatest rewards with minimal losses.

First, as recommended by Arif Rafiq, Pakistan needs to create a formalised CPEC authority[80] that oversees all investment from China. This should be led by the Prime Minister with equal representation from all of the provinces. This will ensure that CPEC projects are distributed evenly and as well as improve interagency coordination. As a result, this will build a sustainable consensus in favour of CPEC.

Second, I would suggest that the government introduce their own version of China’s Leading Small Groups (LSGs)[81] to supplement the CPEC authority. Every project should have its own LSG that focuses on community dialogue to ensure that local residents are kept in the loop, and their needs are addressed. This will significantly improve the public’s approval of CPEC.

Third, Pakistan needs to scale back on CPEC projects until the energy crisis is addressed. I propose that Pakistan puts all non-energy projects on hold and introduce more projects focused on increasing transmission efficiency. Once the energy projects are completed and the energy crisis put to an end, then Pakistan should begin work on other CPEC projects. This will help avoid another ‘Punjab Speed’ incident[82].

Fourth, I would recommend that CPEC place more emphasis on renewable energy. In doing so, Pakistan can ensure a sustainable energy supply which will help foster long term economic growth. Introducing solar panels on a local scale will be especially effective in rural communities. In fact, Balochistan has a solar power potential of over 2,200 kWh/m² per year[83] , making it the ideal location for concentrated solar power plants.

Fifth, CPEC should invest in more welfare projects on the local level, especially in Balochistan. This will help ensure that the correct social development measures are being taken to improve education and healthcare provision throughout Pakistan. As a result, Pakistan’s HDI will increase along with household incomes. Thereby, CPEC will be able to alleviate poverty and contribute to the betterment of Pakistani citizens.

Sixth, I believe it imperative that Pakistan reviews its economic policy in order to increase government revenue and protect workers’ rights, especially when it concerns SEZs. By doing so, Pakistan will end the debt crisis and ensure that Pakistani citizens are not exploited by foreign companies. More importantly, it will provide the government with the necessary funds to continue social development throughout Pakistan.

Lastly, Pakistan needs to ensure peace with its neighbours so CPEC can continue unhindered. To do this, Pakistan must invite its neighbours to the negotiation table and discuss how Pakistan can facilitate trade between South Asia and the wider world. One such example would be to connect Afghanistan to CPEC[84] via an Afghanistan-Pakistan economic corridor. Thereby giving Pakistan access to Afghanistan’s natural resources and giving Afghanistan access to the Arabian Sea.


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[19] Ministry of Planning and Development, Pk. (2019). CPEC | China-Pakistan Economic Corridor (CPEC) Official Website. [online] Cpec.gov.pk. Available at: http://cpec.gov.pk/ [Accessed 24 Dec. 2019].

[20] Mustafa, K. (2018). Country’s installed electricity capacity increases by 30pc to 29,573MW. The News. [online] Available at: https://www.thenews.com.pk/print/309535-country-s-installed-electricity-capacity-increases-by-30pc-to-29-573mw [Accessed 24 Dec. 2019].

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[22] Ministry of Planning and Development, Pk. (2019). CPEC | China-Pakistan Economic Corridor (CPEC) Official Website. [online] Cpec.gov.pk. Available at: http://cpec.gov.pk/ [Accessed 24 Dec. 2019].

[23] Rehman, M. (2019). Pakistan’s electricity generation has increased over time. So why do we still not have uninterrupted supply?. Dawn. [online] Available at: https://www.dawn.com/news/1430728 [Accessed 1 Jan. 2020].

[24] Pakistan Ministry of Planning and Development (2019). Long Term Plan for China-Pakistan Economic Corridor (2017-2030). [online] Pakistan Ministry of Planning and Development. Available at: http://cpec.gov.pk/long-term-plan-cpec [Accessed 19 Nov. 2019].

[25] Rafiq, A. (2019). The China-Pakistan Economic Corridor: The Lure of Easy Financing and the Perils of Poor Planning. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.236-248.

[26] Ministry of Planning and Development, Pk. (2019). CPEC | China-Pakistan Economic Corridor (CPEC) Official Website. [online] Cpec.gov.pk. Available at: http://cpec.gov.pk/ [Accessed 24 Dec. 2019].

[27] aqicn.org. (2019). Air Pollution in the World. [online] Available at: https://aqicn.org/search/#q=Pakistan [Accessed 30 Dec. 2019].

[28] Energypedia.info. (2019). Pakistan Energy Situation – energypedia.info. [online] Available at: https://energypedia.info/wiki/Pakistan_Energy_Situation [Accessed 24 Dec. 2019].

[29] Rehman, A. and Tahir, K. (2019). Pakistan: Foreign reserves and the debt crisis. [online] London School of Economics and Political Science. Available at: https://blogs.lse.ac.uk/southasia/2019/04/10/pakistan-foreign-reserves-and-the-debt-crisis/ [Accessed 30 Dec. 2019].

[30] ibid

[31] ibid

[32] Bokhari, F. and Findlay, S. (2019). Imran Khan swallows pride to clinch toughest IMF bailout yet. Financial Times. [online] Available at: https://www.ft.com/content/10318f10-7677-11e9-bbad-7c18c0ea0201 [Accessed 31 Dec. 2019].

[33] Khawar, H. (2019). CPEC debt trap — fiction or reality?. The Express Tribune. [online] Available at: https://tribune.com.pk/story/1967059/6-cpec-debt-trap-fiction-reality/ [Accessed 1 Jan. 2020].

[34] Masood, Y. (2019). China economic corridor is debt reliever for Pakistan. The Telegraph. [online] Available at: https://www.telegraph.co.uk/china-watch/business/cpec-not-debt-trap-pakistan/ [Accessed 1 Jan. 2020].

[35] Rafiq, A. (2017). The China-Pakistan Economic Corridor: Barriers and Impact. [online] United States Institute of Peace. Available at: https://www.usip.org/publications/2017/10/china-pakistan-economic-corridor [Accessed 14 Nov. 2019].

[36] Kugelman, M. (2019). Great Potential, Many Pitfalls: Understanding China’s Belt and Road Initiative. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.180-186.

[37] Rolland, N. (2019). Beijing’s Response to the Belt and Road Initiative’s “Pushback”: A Story of Assessment and Adaptation. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.216-235.

[38] Hurley, J., Morris, S. and Portelance, G. (2018). CGD Policy Paper 121 March 2018 Examining the Debt Implications of the Belt and Road Initiative from a Policy Perspective. [online] Center for Global Development, p.19. Available at: https://www.cgdev.org/sites/default/files/examining-debt-implications-belt-and-road-initiative-policy-perspective.pdf [Accessed 1 Jan. 2020].

[39] Kugelman, M. (2019). Great Potential, Many Pitfalls: Understanding China’s Belt and Road Initiative. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.180-186.

[40] Kratz, A., Feng, A. and Wright, L. (2019). New Data on the “Debt Trap” Question. [online] Rhodium Group. Available at: https://rhg.com/research/new-data-on-the-debt-trap-question/ [Accessed 1 Jan. 2020].

[41] Dawn (2020). Economics and extremism. [online] Available at: https://www.dawn.com/news/844412/economics-and-extremism [Accessed 2 Jan. 2020].

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[43] Rafiq, A. (2017). The China-Pakistan Economic Corridor: Barriers and Impact. [online] United States Institute of Peace. Available at: https://www.usip.org/publications/2017/10/china-pakistan-economic-corridor [Accessed 14 Nov. 2019].

[44] ibid

[45] Bengali, K., Baloch, I., Khan, B., Tareen, M., Hafeez, M. and Yousuf, S. (2015). China-Pakistan Economic Corridor?: The Route Controversy. [online] Government of Balochistan. Available at: https://www.academia.edu/35153865/CPEC_The_Route_Controversy.pdf [Accessed 3 Jan. 2020].

[46] The News (2015). Nawaz had ‘solid information’ about former ISI chief’s role in Dharna. [online] Available at: https://www.thenews.com.pk/print/13759-nawaz-had-solid-information-about-former-isi-chiefs-role-in-dharna [Accessed 3 Jan. 2020].

[47] Wasim, A. (2015). Livid over corridor route, senators walk out of Senate twice. Dawn. [online] Available at: https://www.dawn.com/news/1161402/livid-over-corridor-route-senators-walk-out-of-senate-twice [Accessed 3 Jan. 2020].

[48] Times Of Islamabad (2017). KP has no reservations on Western route of CPEC: Pervaiz Khattak. [online] Available at: https://timesofislamabad.com/17-Apr-2017/kp-has-no-reservations-on-western-route-of-cpec-pervaiz-khattak [Accessed 3 Jan. 2020].

[49] Schwemlein, J. (2019). Flawed by Design: The Challenge of Flawed Democracies to China’s Rise. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.249-259.

[50] Rafiq, A. (2017). The China-Pakistan Economic Corridor: Barriers and Impact. [online] United States Institute of Peace. Available at: https://www.usip.org/publications/2017/10/china-pakistan-economic-corridor [Accessed 14 Nov. 2019].

[51] Dawn (2016). Orange Line to gobble up Punjab’s budget, says Pervaiz. [online] Available at: https://www.dawn.com/news/1265122 [Accessed 3 Jan. 2020].

[52] Rafiq, A. (2017). The China-Pakistan Economic Corridor: Barriers and Impact. [online] United States Institute of Peace. Available at: https://www.usip.org/publications/2017/10/china-pakistan-economic-corridor [Accessed 14 Nov. 2019].

[53] Ministry of Planning and Development, Pk. (2019). CPEC | China-Pakistan Economic Corridor (CPEC) Official Website. [online] Cpec.gov.pk. Available at: http://cpec.gov.pk/ [Accessed 24 Dec. 2019].

[54] Rafiq, A. (2017). The China-Pakistan Economic Corridor: Barriers and Impact. [online] United States Institute of Peace. Available at: https://www.usip.org/publications/2017/10/china-pakistan-economic-corridor [Accessed 14 Nov. 2019].

[55] ibid

[56] Baloch, I. (2015). Balochistan: Rich In Natural Resources And Poor In Living Conditions. The Balochistan Point. [online] Available at: http://thebalochistanpoint.com/balochistan-rich-in-natural-resources-and-poor-in-living-conditions/ [Accessed 4 Jan. 2020].

[57] Dawn (2015). Mengal asks govt to hand over Gwadar port to Balochistan. [online] Available at: https://www.dawn.com/news/1221621 [Accessed 4 Jan. 2020].

[58] South China Morning Post (n.d.). Pakistan hands management of strategic Gwadar port to China. [online] Available at: https://www.scmp.com/news/asia/article/1153524/pakistan-hands-management-strategic-gwadar-port-china [Accessed 4 Jan. 2020].

[59] Muhammad, P. (2014). Saindak Copper-Gold Project: Govt moves to transfer ownership to Balochistan. The Express Tribune. [online] Available at: https://tribune.com.pk/story/623093/saindak-copper-gold-project-govt-moves-to-transfer-ownership-to-balochistan/ [Accessed 4 Jan. 2020].

[60] Rafiq, A. (2017). The China-Pakistan Economic Corridor: Barriers and Impact. [online] United States Institute of Peace. Available at: https://www.usip.org/publications/2017/10/china-pakistan-economic-corridor [Accessed 14 Nov. 2019].

[61] Marshall, T. (2015). Prisoners of Geography: Ten Maps That Tell You Everything You Need To Know About Global Politics. 2nd ed. London: Elliott and Thompson Limited, pp.36-61 and pp.188-212.

[62] White-Spunner, B. (2018). Partition. Simon & Schuster LTD.

[63] Wang, Y. and Liu, X. (2019). Is the Belt and Road Initiative a Chinese Geo-Political Strategy?. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.260-267.

[64] Yu, S. (2019). The Belt and Road Initiative: Modernity, Geopolitics and the Developing Global Order. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.187-201.

[65] Khemani, R. (2019). India rejects China’s invitation to Belt and Road Initiative meet for the second time. TFIPOST. [online] Available at: https://tfipost.com/2019/04/bri-india-china-01/ [Accessed 5 Jan. 2020].

[66] BBC News (2019). Kashmir: captured Indian pilot, freed by Pakistan – BBC News. Available at: https://www.youtube.com/watch?v=EFbF5VBFmFw [Accessed 5 Jan. 2020].

[67] Mackenzie, J. (2019). Pakistan says wants peace with India, Modi responds after victory speech. Reuters. [online] Available at: https://www.reuters.com/article/us-india-election-pakistan/pakistan-says-wants-peace-with-india-modi-responds-after-victory-speech-idUSKCN1ST0LW [Accessed 5 Jan. 2020].

[68] Khemani, R. (2019). India rejects China’s invitation to Belt and Road Initiative meet for the second time. TFIPOST. [online] Available at: https://tfipost.com/2019/04/bri-india-china-01/ [Accessed 5 Jan. 2020].

[69] Roy, N. (2019). China-Pakistan Economic Corridor – Is it the Road to the Future?. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.268-282.

[70] Pandit, R. (2018). India expresses strong opposition to China Pakistan Economic Corridor, says challenges Indian sovereignty. The Economic Times. [online] Available at: https://economictimes.indiatimes.com/news/defence/india-expresses-strong-opposition-to-china-pakistan-economic-corridor-says-challenges-indian-sovereignty/articleshow/57664537.cms?from=mdr [Accessed 5 Jan. 2020].

[71] Thakuria, N. (2019). India Pushes a Breakaway Balochistan. Asia Sentinel. [online] Available at: https://www.asiasentinel.com/politics/india-pushes-breakaway-balochistan/ [Accessed 5 Jan. 2020].

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[73] Aamir, A. (2019). How Baloch Separatists Are Trying to Derail China’s Investments in Pakistan. World Politics Review. [online] Available at: https://www.worldpoliticsreview.com/articles/27868/how-baloch-separatists-are-trying-to-derail-china-s-investments-in-pakistan [Accessed 5 Jan. 2020].

[74] UN News (2019). UN Security Council discusses Kashmir, China urges India and Pakistan to ease tensions. [online] Available at: https://news.un.org/en/story/2019/08/1044401 [Accessed 5 Jan. 2020].

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[76] Al-Jazeera (2019). Kashmir under lockdown: All the latest updates. [online] Available at: https://www.aljazeera.com/news/2019/08/india-revokes-kashmir-special-status-latest-updates-190806134011673.html [Accessed 5 Jan. 2020].

[77] Chotiner, I. (2019). India’s Citizenship Emergency. The New Yorker. [online] Available at: https://www.newyorker.com/news/q-and-a/indias-citizenship-emergency [Accessed 5 Jan. 2020].

[78] Dhume, S. (2019). Pakistan Gives a Pass to China’s Oppression of Muslims. The Wall Street Journal. [online] Available at: https://www.wsj.com/articles/pakistan-gives-a-pass-to-chinas-oppression-of-muslims-11570142866 [Accessed 5 Jan. 2020].

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[81] Rolland, N. (2019). Beijing’s Response to the Belt and Road Initiative’s “Pushback”: A Story of Assessment and Adaptation. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.216-235.

[82] Rafiq, A. (2019). The China-Pakistan Economic Corridor: The Lure of Easy Financing and the Perils of Poor Planning. Asian Affairs: Journal of the Royal Society for Asian Affairs, 50(2), pp.236-248.

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