Page 1 of 4
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 11
October 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 122
China Pakistan Economic Corridor (CPEC): A Corridor for Success or
Uncertainity for India, Pakistan and China.
Dr. Jagpal Mann
Assistant Professor, History,
Culture and Archaeology.
C.R.S.U, JIND
INTRODUCTION
The 3,000 km-long China–Pakistan
Economic Corridor (CPEC) consisting of
highways, railways, and pipelines is the
latest irritant in the India–China relationship.
CPEC is clutch of projects valued at $51
billion project which aims at rapidly
expanding and upgrading Pakistan’s
infrastructure and strengthening the
economic ties between the People’s
Republic of China (China) and Pakistan. It
includes building roads, laying railway lines
and pipelines to carry oil and gas. CPEC
eventually aims at linking the city of
Gwadar in South Western Pakistan to
China’s North Western region Xinjiang
through a vast network of highways and
railways.The proposed project will be
financed by heavily-subsidised loans, that
will be disbursed to the Government of
Pakistan by Chinese banking giants such as
Exim Bank of China, China Development
Bank, and the Industrial and Commercial
Bank of China.The CPEC, once completed
is expected to cut short the trade route for
China’s oil imports by 6000 miles. It is
expected to open up a brand-new strategic
gateway for China to tap into African, West
Asian and South Asian trade.The CPEC is
expected to give the flagging Pakistan
economy a shot in the arm too. About 90 per
cent of the total outlay for this project will
be funded by the consortium of Chinese
banks and the balance 10 per cent by
Pakistan. Reports claim that this project will
likely add about 7 lakh direct jobs between
2015 and 2030 and add about 2-2.5
percentage points to the Pakistani
GDP.Besides the potential for growth,
power and jobs, Pakistan also expects the
CPEC to bind it in an even tighter embrace
with close friend China, giving it greater
strategic leverage with both India and the
United States in the Indian Ocean region.
CHINA’S INTEREST
The CPEC is part of China’s larger regional
transnational ‘One Belt One Road’ (OBOR)
initiative, whose two arms are the land- based New Silk Road and the 21st century
Maritime Silk Road, using which Beijing
aims to create a Silk Road Economic Belt
sprawled over a large patch of Asia and
eastern Europe, and crisscrossed by a web of
transport, energy supply and
telecommunications lines.
Gwadar lies close to the Strait of Hormuz, a
key oil shipping lane. It could open up an
energy and trade corridor from the Gulf
across Pakistan to western China, that could
also be used by the Chinese Navy. The
CPEC will give China land access to the
Indian Ocean, cutting the nearly 13,000 km
sea voyage from Tianjin to the Persian Gulf
through the Strait of Malacca and around
India, to a mere 2,000 km road journey from
Kashgar to Gwadar. The development of
Kashgar as a trade terminus will reduce the
isolation of the restive Xinjiang province,
Page 2 of 4
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 11
October 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 123
deepen its engagement with the rest of
China, and raise its potential for tourism and
investment. Central Asian republics are keen
to plug their infrastructure networks to the
CPEC — this will allow them access to the
Indian Ocean, while contributing to the
OBOR initiative. For Chinese companies,
the massive scale of the CPEC provides
investment opportunities for several years to
come. As per the terms of the agreement,
they will be able to operate the projects as
profit-making entities.
WHY CPEC A MATTER OF
CONCERN FOR INDIA
If the corridor opens up a major new global
trade route, not just Pakistan and China, but
also India which is quite strategically
located on the corridor, may see positive
spillover effects from burgeoning trade with
West Asia or Africa. CPEC establishes a
symbiotic relationship between China and
Pakistan and political analysts worry that
this may have ramifications for the
geopolitical situation in Kashmir, especially
as the CPEC corridor passes straight through
disputed Pakistan-occupied Kashmir (PoK).
The worry is if the high economic stakes in
the project will allow China to remain
neutral if the Kashmir dispute escalates.
OPTIONS INDIA CAN OPT FOR
India should stop making intermittent and
tentative overtures and instead adopt a
robust policy on PoK. Quite clearly, India’s
non-endorsement or indifference to China’s
Silk Road proposal appears to be short- sighted thinking, perhaps stemming from
suspicion and insecurity.
Also, India can do little to stop OBOR
or scuttle the CPEC. Almost all the
countries in the subcontinent are
excited about the project. India’s non- participation would lead to isolation
and loss of clout at the regional level.
Being the world’s second largest
economy and India’s largest trading
partner, New Delhi is unable to ignore
China anyway. To be sure, OBOR may
be carrying security undertones but
India also requires massive
infrastructure investment and only
China seems to have the surplus capital.
Without partnering with China, India’s
integration in Asian regionalisation
would be less than smooth.
Chinese companies are building
infrastructure in India and there is little
difference whether one gains by helping
or limiting China’s influence. It cannot
be in India’s interest to support the
project and not reap all the economic
benefits of those projects. It is
important to establish a fine balance
between economics with security.
India also cannot ignore the
significance of the symbolism of
history. After all, it was the Silk Route
on which Indian trade and philosophy
(Buddhism) travelled to the rest of
Asia. As China is fast transforming
internally, the imperatives of cultural
affinity will demand
closer propinquity between India and
China.
Thus, staying outside cannot be to
India’s advantage. New Delhi needs to
re-conceptualise and seek new realities
on the ground. China has called upon
India to join the Silk Route and India
should respond positively while
accepting a trade-off here and there.
A wise approach would be to join the
regional networking process just as
India joined the Asian Infrastructure
Investment Bank (AIIB). There is
nothing wrong in exploring CPEC as an
alternative as long as India’s security
interests are not compromised.
Page 3 of 4
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 11
October 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 124
ANALYSIS OF INDIA CHINA
RELATIONS
The India-China relationship is one of
partnership as well as of rivalry i.e.
partnership in growing trade relationship
and rivalry as China increases its influence
in the region and uses Pakistan to
checkmate India. Recently, Foreign
Secretary S.Jaishankar visited Beijing for
the first Sino-Indian strategic dialogue
since Prime Minister Mr. Narendra Modi
took over. The dialogue came in the wake
of China’s veto for the third time against
designation of Jaish-e-Mohammad Chief
Masood Azhar as a terrorist by the United
Nations. China has also blocked India’s
entry into NSG. It has also ignored Indian
objections to the proposed CPEC passing
through Pakistan occupied Kashmir which
India claims as a sovereign territory. India
and China have been strategic partners
since 2005.
1. The visibility accorded to the issues of
Masood Azhar and NSG membership to
India were of much higher order. It is
expected that India and China could
work towards some kind of common
objective in relation to Afghanistan.
Though, it is tough to draw any definite
conclusion after single round of talks as
the disputes between these countries
have been there for a very long time.
They have defied solutions over the
years and in the last couple of years,
there have been more complications.
India explained its rationale to China on
the listing of Azahar under UN 1267
sanctions committee during strategic
talks.
2. China at present is much more heavily
invested in Pakistan than it ever was.
Therefore, in terms of India’s foreign
policy challenges vis-a-vis Pakistan, it
has to be careful of China’s inclination
towards Pakistan as well. This is also a
reason why China has put technical
hold on Masood Azhar’s issue for the
third time given all the evidence are
available. The evolution of Beijing’s
stance on terrorism in and emanating
from Pakistan is an area of prime
concern to India.
3. The forums for discussion of all
outstanding issues are actually narrow
and for Sino-Indian relationship, more
such forums are needed for interaction.
For example- there are complaints
regarding adverse trade balance for
which there can be a trade
representative so that the two countries
can have a new forum to discuss all
outstanding issues related to trade. This
way, India’s decision making process
will be complemented on another facet.
This will also not encroach upon core
issues where both the countries differ.
India and China have done business
worth $70 billion but almost $53 billion
of this is Chinese imports to India.
4. The entire dialogue was called
restructured strategic dialogue. What is
the restructuring all about is something
to be known. When China speaks of
joint development projects, one has to
analyze it thoroughly because China is
using this terminologgy for South
China Sea disputes for which it is not
willing to give up its sovereignty
claims.
Conclusion
There’s little that India can do about the
CPEC. But to look at the bright side, a more
economically stable Pakistan may be quite
good for India, as both countries can then
look to de-escalate tensions across the
border and talk trade. The 3,000 km-long
China–Pakistan Economic Corridor (CPEC)
consisting of highways, railways, and
pipelines is the latest irritant in the India–
