CPEC AT A GLANCE

CPEC AT A GLANCE
China Pakistan Economic Corridor

Muhammad Usman (BBA-lll) 7/21/18

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 CPEC AT A GLANCE 786

Preface
Mostly people do not know exactly what CPEC is and what projects it includes. Mainly because
of their busy schedules. On the other hand there are lots of misconceptions about CPEC. For
instance, CPEC is second East India Company etc. So this attempt is made to give a quick
overview about OBOR and CPEC and to address those misconceptions. After reading this piece
of writing you will be familiar with the main purpose, projects, advantages and disadvantages
of CPEC which I think is necessary for everyone. Queries are highly encouraged. Thank you!

Muhammad Usman
Student
SIBA University
usman.ba17@iba-suk.edu.pk

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Contents
 OBOR
 CPEC
 Vision
 Goals
 Projects
 Energy Projects
 Railway Link
 Development of Gwadar Port/City
 Highways and Motorways Networks (Gwadar-Khunjrab)
 Digital Corridor
 Special Economic and Industrial Zones
 CPEC, a second East India Company?
 SWOT analysis
 Conclusion
 Resources

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CPEC AT A GLANCE

OBOR
One Belt, One Road (OBOR), also known as Belt and Road Initiative (BRI), and The Silk Road
Economic Belt and the 21st-century Maritime Silk Road, is a Chinese government economic
development framework for primarily integrating trade and investment among Eurasian
countries, primarily China, the land-based “Silk Road Economic Belt” (SREB) and the oceangoing
“Maritime Silk Road” (MSR).
OBOR is the vision of Chinese President Xi Jinping for the push for connectivity of China with the
world. Not since the Marshall Plan post-World War ll, there has been taken by an individual
country to give a new strength to the global economy. Since the announcement, over 100
countries, including Pakistan, India, Russia, Turkey, Poland and New Zealand, have been
involved with the initiative. In the initiative Belt covers the land and Maritime road covers sea.

The initiative will build six transnational corridors

1. Eurasia land bridge of Economic Corridor (Western China to Western Russia)

2. China-Mongolia-Russia Economic Corridor (Northern China To Eastern Russia)
3. China-Central Asia-West Asia Economic Corridor (Western China to Turkey)
4. Indonesia Peninsula Economic Corridor (Southern China to Singapore)
5. China Pakistan Economic Corridor
6. Bangladesh-China-India-Myanmar Economic Corridor

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CPEC
China-Pakistan Economic Corridor (CPEC), which is one of the six economic corridors of BRI,
serves as the flagship project. CPEC will open Western China and Central Asia with connectivity
to the sea with the most efficient route to the sea through Gwadar. It will provide two-way
trade routes to the world, not only for Pakistan but for Afghanistan, Central Asia and Western
China. It will provide rail and road links, gas, power, special economic zones (SEZs) and
information technology links and it will provide this region with access to the world through BRI.
CPEC provides a platform to build on. Basically, it is a program that will evolve and grow. The
projects under CPEC are built on two principles. The first principle is economic viability and the
second principle is environmental sustainability. CPEC is an investment of US$46 billion to $62
billion which is distributed among energy projects, railway links, highways network,
development of Gwadar port/city, digital corridor and special economic zones.

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Vision
The Chinese side vision: To further advance the western development strategy, promote
economic and social development in western China, accelerate the Belt and Road construction,
give play to China’s advantages in capital, technology, production capacity and engineering
operation, and promote the formation of a new economic system.

The Pakistan side vision: To fully harness the demographic and natural endowment of the
country by enhancing its industrial capacity through creation of new industrial clusters, while
balancing the regional socioeconomic development, enhancing people’s wellbeing, and
promoting domestic peace and stability.

The international and regional vision: To form a new international logistics network and
industrial layout based on major transportation infrastructure; elevate the status of South Asian
and Central Asian countries in labor division of global economy; promote regional economic
integration through stable growth, international economic and technological cooperation and
personnel exchange.

Goals
By 2020, the CPEC strives to take the initial shape, major bottlenecks to Pakistan’s economic and
social will be basically addressed, and the CPEC will start to boost the economic growth along it
for both countries. By 2025, the CPEC building strives to be basically done, the industrial system
approximately complete, major economic functions brought into play in a holistic way. The
CPEC’s role in stimulating economic growth in Central Asia and South Asia brought into holistic
play, and South Asia will grow into an international economic zone with global influence.

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Projects
CPEC is a program that will grow but basically it consists of six basic projects including energy
projects, highways and motorways networks, railway links, development of Gwadar port and
city, digital corridor and special economic and industrial zones.

Energy Projects
China and Pakistan will strengthen cooperation in the fields of oil and gas, electricity and power
grids as well as an effective distribution and transmission system, and it will focus on promoting
the construction of major projects of thermal power, hydropower, coal gasification and
renewable power generation, and supporting power transmission networks.

 Optimize the sourcing and use of coal, and research on development and utilization of
Pakistan’s own coal for power plant
 Promote the cooperation in the development of oil and gas resources, research on the
integrated vision and demand of China and Pakistan oil and gas cooperation
 Activity promote river planning and preparatory work of major projects to accelerate
the hydropower development process
 Develop wind and solar energy based on local conditions, and establish diversified
energy supply channels
 Strengthen the construction of high voltage-class power grids and power transmission
and distribution networks to fulfil the electricity demand and ensure the reliability of
electricity supply in Pakistan

Quaid-e-Azam Solar, Sahiwal coal, Port Qasim coal, Gwadar Coal, Hydro China, Dawood
Wind, Sachal winds, United Energy Pakistan wind farm, Rahimyar Khan coal, Sino Sindh
Resources Limited Thar coal, Thar Engro coal, Suki Kinari Hydropower and Karot
Hydropower Projects are the main energy projects.

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Railway Link
In addition to energy projects, there are also few railway line projects. The main railway link will
join Kashi and Gwadar. CPEC will also work on rehabilitation and upgrading of Karachi-Lahore-
Peshawar (ML-1) railway track. It also includes Orange Line Metro Train in Lahore.

Development of Gwadar Port/City

Gwadar Port, located at a strategic position, is the CPEC gateway, and provides enormous
opportunities and a window into the landlocked Central Asian Republics. Gwadar has enormous
potential from all angles and dimensions for any kind of business activity. Gwadar International
Terminals Ltd. (GITL), being a Warm Water Natural Deep Sea Port and because of its strategic
location, will be a gateway and hub of world business. CPEC also considers the infrastructure of
the city like international airport, roads, schools, hospitals etc. The project will provide all basic
needs for the people of Gwadar.

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Highways and Motorways Network

Transport infrastructure is the best and prerequisite condition for the construction of CPEC. It is
an important field that can be relied on to the guide and drive the economic and social
development of regions along the CPEC, besides promoting the interconnectivity and all-around
cooperation between China and Pakistan for shared prosperity. Through the joint planning and
development of highways, it can give a new strength to our economy and also our
transportation. The project has considered the construction of so many roads which includes
Kashgar-Islamabad, Peshawar-Islamabad-Karachi, Sukkur-Gwadar Portand Dera Ismail Khan-
Quetta-Sohrab-Gwadar road and Karakorum highway Phase-ll.

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Digital Corridor
Along the all economic consideration, CPEC has also taken an initiative related to
communication framework which includes components such as a fiber optic cable connecting
Pakistan and China, a new submarine landing station for internet traffic flow and digital TV for
all. The most critical component is a new, upgraded fiber optic cable network which spans
Pakistan and crosses the border with China and along with other components it will not only
connect but also make this economic corridor as a Digital Corridor.

The cross-border fiber optic cable will address so many challenges faced by China and Pakistan.
Firstly it says it will handle the anticipated countries. With deepening comprehensive strategic
cooperation comes the need to establish fast, reliable connectivity and perhaps most critically
communication that is not routed through Europe, the United States or India.

The long term plan states that the cross-border optic cable will start from China’s Tashkurgan
Tajik Autonomous Country and travel 135km to connect to Pakistan. The plan also includes
carrying out improvements on the 804km long backbone transmission network from Sukkur to
Gwadar.

The introduction of terrestrial Digital TV with a network covering over 90% of Pakistan’s
population is another key project. Chinese enterprises will provide Pakistan with Digital
Terrestrial Multimedia Broadcast (DTMB) technology to enable the switch to digital TV.

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Special Economic and Industrial Zones

CPEC, as an economic corridor, has a plan for establishing Special Economic Zones (SEZs). SEZ is
a geographical region that has economic laws. SEZs are the engine of economic growth. Nine
sites have been selected as prioritized SEZs. Each economic zone will target specific products
and services, based on the availability of local raw material, workforce and other such factors.

The government has planned to establish nine Special Economic Zones (SEZs) in all the four
provinces, federal area and Gilgit-Baltistan under the framework of CPEC, which would be
completed in a period of three years. Pakistan has conducted feasibilities of 5 SEZs which focus
only on the infrastructure. The three prioritized SEZs to be completed in the first phase of LTP
are M3 Industrial City in Faisalabad, Punjab, Chinese SEZ Dhabeji, Sindh and Hattar SEZ in KP
province. While the remaining six sites include Rashakai Economic Zone, M-1 Noshera, Bostan
Industrial Zone District Pishin, Allama Iqbal Industrial City, Moqpondass SEZ in Gilgit-Baltistan,
ICT Model Industrial Zone Islamabad, Development of Industrial Park on Pakistan Steel Mills
Land at Port Qasim near Karachi, Special Economic Zone at Mirpur AJK, Mohmand Marble city.

CPEC’s industrialization plan fills in the gap that has emerged over last four decades in the field
of plan for industrialization of the country. SEZs will promote industries sin Pakistan using local
raw material which effectively means that value addition previously being undertaken outside
Pakistan will be undertaken in Pakistan. This will naturally improve employment opportunities in
Pakistan.

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CPEC, a second East India Company?

Some people say, China will become East India Company. They will rule over Pakistan. So, it is
not the case. Firstly, today we are living in a modern era, there are international laws, rules and
regulations. Countries have become dependent on one another. If any state or country takes
any attempt so ultimately it is also bad for itself. Secondly, Pakistan and China have same kind of
interest. They both wanted to develop their western region which can be done with the
completion and sustainability of the project. So there is not any chance that China will do any
this type of activity. Thirdly, CPEC is one of the corridors of OBOR and approximately 68
countries are the part of this project. If anything goes wrong with CPEC or with Pakistan, so all
other countries will withdraw from OBOR which is a big loss for China. Finally, in 3000 years of
history, China has never occupied a single inch of foreign territory compared to every other
global power that has done imperialism in history. So, China seeks partnership. China seeks to
bring fruits of development and share fruits of development with all other countries in the
shape of OBOR.

SWOT analysis
Strength of CPEC

 Gwadar port and international airport.

 Crude oil depot and oil refinery at Gwadar.
 Highway Structure (3000 km).
 Railway structure (1100 km, Kashgar to Islamabad and rehabilitation of existing rail
structure in Pakistan).
 Pakistan-China strategic relationship (china daily, 2013).
 Petroleum transportation.
 Energy infrastructure 21,690 MW (Pakistan today, 2014).
 Telecommunication (optical fiber cable from china border to Rawalpindi).
 Research activities (joint research cotton biotechnology research center).
 Opening doors for Pakistani market to European, Middle east, Gulf countries, Russia and
Africa

Weaknesses of CPEC

 Political viewpoints on route of roads.

 Lack of fund usage transparency
 Lack of seriousness on project implementation.
 Lack of long term and non-interrupting internal (local) and external (foreign) policies.

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Opportunities of CPEC

 Infrastructure buildup including roads and railway track up gradation.

 Job opportunities for all Pakistan.
 Very huge international investment
 Economic empowerment to poor and backward areas like Baluchistan, Federally
Administered Tribal Areas (FATA) and north Sind, Gilgit Baltistan, North-West China
regions including Xinjiang.
 Joint research activities in various areas of life and technology
 Great opportunities for local and foreign investors in region like Iran and Gulf countries
 Increase demand of education, security and health will provide better lifestyle accurse
the corridor.
 Building up several industrial zones along with highway and rail structure.
 Iran-Pakistan and China gas pipeline.

Threats of CPEC

 Security threats from Xinjiang separating militant groups

 Tehreek-e-Taliban and other terrorist groups like Balochistan Liberation Army.
 Insurgent activities of traitors in supported by The Research and Analysis Wing(RAW), Central
Intelligence Agency (CIA) and MOSSAD in region.
 U.S, Afghanistan and Indian foreign policies towards Pakistan.

Conclusion
The China-Pakistan Economic Corridor will be the game changer for Pakistan. It is our duty to
support this corridor. Planners should improve the map by delivering and connecting more to
needy and also encourage most populated and existing industrial zone. Government should
stretch its planning and increase the number of stakeholders for CPEC to get maximum juice of
this joint step of Pakistan and China governments. Long live Pak-China friendship.

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Resources
 CPEC Summit 2018, Dawn Report
 cpec.gov.pk
 Slide share
 Photo Credits: Google Photos

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