Context: Recently, Pakistan and China decided to welcome any third country joining the multi-billion dollar China-Pakistan Economic Corridor (CPEC).

Key Issue

• The lack of progress has led to numerous reports about CPEC being at a near standstill in the country.

• Gwadar, despite being the epicenter of multibillion-dollar projects, lacks basic necessities like reliable access to water and electricity, let alone other facilities.

• The Baloch freedom movement is another impediment to the stalled project.

• There have been sporadic attacks in Gwadar and elsewhere in the province and the country to discourage Chinese investments in the province.

• China is also seeking to deploy its Army in the CPEC projects, to which Pakistan has contested.

Key Points

• The third meeting of the China-Pakistan Economic Corridor (CPEC) Joint Working Group (JWG) on International Cooperation and Coordination (JWG-ICC) was recently held in virtual mode.

• In context to Afghanistan, it had broken new ground in strengthening international and regional connectivity.

• Earlier, Pakistan signed a new agreement with China to begin the second phase of the USD 60 billion China-Pakistan Economic Corridor (CPEC).

China-Pakistan Economic corridor

• It is a proposed economic corridor that will connect the north-western Chinese province of Xinjiang with the Pakistani port of Gwadar through a network of roads measuring around 3000 kms

• It will provide Pakistan its much-needed economic infrastructure, especially power-generation plants.

• It is located where the Silk Road Economic Belt and the 21st Century Maritime Silk Road meet.

• It is, therefore, a major project of the "Belt and Road" initiative.

• It also aims to help economically develop the predominantly Muslim northwest region of China by connecting it with Gwadar, a closer outlet than any Chinese coastal port.

• China has made commitments to provide around $46 billion in development deals, which is equivalent to roughly 20 per cent of Pakistan's annual GDP.

Impact on India

• India’s Sovereignty: India has continuously opposed the project since it passes through the Pakistan-occupied Kashmiri territory of Gilgit-Baltistan – a claim opposed by Pakistan.

• Chinese Control Over Trade Via Sea: Major US ports on the East Coast depend on the Panama Canal to trade with China.

• Once CPEC becomes fully functional, China will be in a position to offer a ‘shorter and more economical’ trade route (avoiding travel through the entire Western Hemisphere) to most North and Latin American enterprises.

• This will give China the power to dictate the terms by which the international movement of goods will take place between the Atlantic and the Pacific oceans.

Chinese String of Pearls: China has been increasing its presence in the Indian Ocean with the ‘String of Pearls’ ambition:

• String of Pearl is a term coined by the Americans to refer to a Chinese game-plan of encircling India through a network of airfields and ports.

• With an existing presence in Chittagong port (Bangladesh), Hambantota port (Sri Lanka), Port Sudan (Sudan), Maldives, Somalia and Seychelles, a control of Gwadar port establishes complete dominance of the Indian ocean by the Communist nation.

• Emergence of Pakistan as an Outsourcing Destination: Often referred to as the ‘Marshall Plan’ of China – named after a historic US plan to provide financial aid to western Europe in the aftermath of World War 2 – CPEC is poised to speed up Pakistan’s economic progress.

• Stronger OBOR: China’s one-belt-one-road (OBOR) project has been often seen as China’s plan to dominate the region politically.

• CPEC is one giant step in the same direction.