South Asia | 'Punjab-centric' China-Pakistan Economic Corridor exposes political divisions

‘Punjab-centric’ China-Pakistan Economic Corridor exposes political divisions

Salman Rafi September 14, 2016 9:26 AM (UTC+8)
Asia Times is not responsible for the opinions, facts or any media content presented by contributors. In case of abuse, click here to report.

While economic development usually reduces political conflicts, the opposite seems to be happening in Pakistan where the ambitious China-Pakistan Economic Corridor (CPEC) has flamed controversies. Smaller provinces are objecting to the share they are going to get as also the working logic behind the project. The route of the corridor has become another bone of contention leading China to seek Pakistan military’s indirect help for a smooth completion of the project. Pakistani Prime Minister Nawaz Sharif is not happy with the situation as it exposes political divisions among the provinces and civil and military leadership.

The ambitious China-Pakistan Economic Corridor (CPEC) program has two main components. First, it plans to develop a new trade and transport route from Kashgar in China to Gwadar Port in Pakistan’s western province of Baluchistan. Second, it envisages developing special economic zones along the route, including power projects.

China-Pakistan Economic Corridor
Pakistani Prime Minister Nawaz Sharif (R) and Chinese President Xi Jinping launch a CPEC project by video link from Islamabad on April 20, 2015

The first-phase projects will receive $45.69bn in concessionary and commercial loans, for which financial facilitation to the Chinese companies is being arranged by the Silk Road Fund. These include $33.79bn for energy projects, $5.9bn for roads, $3.69bn for railway network, $1.6bn for Lahore Mass Transit, $66m for Gwadar Port and $4m for a fibre optic project.

Of the total $35bn investment in power projects, nearly $10bn is for Sindh, $7bn for Punjab, $8.5bn for Baluchistan, $2.5bn for Azad Kashmir, $1.8bn for KP, $4.5bn for projects involving Punjab and another province and apparently nothing for Gilgit-Baltistan which provides Pakistan access to China on the economic corridor but is facing the risk of unemployment.

Baluchistan is the only backward region with a high share in this category. However, given past history, it will require special efforts to ensure that the employment and electricity generated by projects there benefit its residents primarily and equitably. Hence, the problem and the subsequent controversy.

Controversy has stemmed over allocation of funds/projects based on population density. According to this formula, Baluchistan, the least populated and least developed province would get the smallest share in terms of investment and benefits in the overall project, leading to a vicious cycle of poverty there.

While Baluchistan is Pakistan’s least developed province and its Gwadar port is going to play a central role in the CPEC by providing China a shorter trade route, the province itself is going get only 8 projects. With Punjab getting 176, Sind 103 and KPK getting 19, nationalist forces in Baluchistan as also in other regions are saying the ‘P’ in CPEC stands for Punjab, not Pakistan.

Speaking at a public meeting held in memory of the victims of August 8 Quetta blasts in the Baba-i-Balochistan Football Stadium on September 3, Baluchistan National Party-Mengal (BNP-M) president Sardar Akhtar Jan Mengal said CPEC would deprive smaller provinces of their rights. Of $46 billion to be spent on the project, not even $1bn would be spent on Baluchistan. CPEC will be least beneficial for the people there. It would serve only China’s ‘pivot to its West’ through Punjab.

What has added substance to this controversy is the absence of clear information available about CPEC and the ruling party’s insistence on keeping it a secret.

“More than a year after the initiation of the CPEC project, there continues to be much ambiguity about what the $46 billion project actually entails. There is little public information and disclosure as to what will be built, how it will be financed (that is, whether some of the money will be a grant or a loan, and on what terms and from whom), and who will implement the various parts of the corridor, which includes roads, railway lines, pipelines and other infrastructure”, said Karachi-based political economist, Akbar S. Zaidi.

The controversy has led to the emergence of certain ‘fronts’ such as The Corridor Front advocating the need for more equitable distribution of benefits among the provinces and transparent implementation.

There is no doubt that the project has a lot of importance for China’s ‘Silk Road’ too. Therefore, any controversy in Pakistan with regard to the projects and its route(s) will affect its implementation.

China is already concerned over the slow implementation of the projects. It wants consensus among all political stakeholders and role of military in ensuring safety of its workers engaged in CPEC.

The Army has created a special division to provide security to the projects and personnel involved therein but Sharif is not happy with the idea of transferring the political credit to the Army.

This is likely to cost him politically as he is aiming to use CPEC project as his big achievement during the 2018 parliamentary elections. According to sources close to Sharif, he and his party have so far parried suggestions as such a move will force them to share control over the corridor with others, the Army in particular, and rival parties will view it as his defeat.

However, much to the PM’s relief, China’s insistence on consensus on the army’s role might not work. The Kalabagh dam controversy is a classical example of military rulers failing to evolve consensus despite all their efforts and all political power at their disposal.

According to stakeholders and activists involved in these above mentioned fronts, the only way to establish a consensus is to evolve a new resource-distribution-formula to make it equally beneficial.

“Baluchistan and Gilgit-Baltistan would never develop if their share continues to be essentially linked to their population density while their territory and location remain neglected elements,” said an activist from Quaid-i-Azam university during a demonstration in front of the Islamabad Press Club.

“Therefore, for a firm political consensus to develop among all regions of Pakistan, the question of resource distribution, which is deeply linked to the ‘national question’, has to be thoroughly reviewed before the actual implementation of CPEC”, said another activist.

Unless this is done, smaller provinces would continue to raise objections as they are doing now.

Salman Rafi Sheikh is a freelance journalist and research analyst of international relations and Pakistan affairs. His area of interest is South and West Asian politics, the foreign policies of major powers, and Pakistani politics. He can be reached at salmansheikh.ss11.sr@gmail.com

Salman Rafi
Salman Rafi Sheikh is a freelance journalist and research analyst of international relations and Pakistan affairs. His area of interest is South and West Asian politics, the foreign policies of major powers, and Pakistani politics. He can be reached at salmansheikh.ss11.sr@gmail.com
Comments