India has been consistently been critical of the $60-billion China-Pakistan Economic Corridor on the grounds that the projects are being built on territory illegally occupied by Pakistan. New Delhi has also argued that the project has been pushing countries towards a debt trap
India has slammed China and Pakistan for their efforts to encourage third countries to join projects relating to their multi-billion dollar connectivity corridor that passes through Pakistan-occupied Kashmir.
This comes after Pakistan and China at a meeting of the CPEC Joint Working Group (JWG) on International Cooperation and Coordination on Friday, Pakistan and China decided to welcome interested third countries to join the flagship CPEC initiative.
But what is Chinese Pakistan Economic Corridor (CPEC)? And why is India upset? Let’s take a closer look:
What is CPEC?
The CPEC is part of China’s ambitious Belt and Road Initiative (BRI) which China described as a “transcontinental long-term policy and investment programme which aims at infrastructure development and acceleration of the economic integration of countries along the route of the historic Silk Road”.
Chinese president Xi Jinping views the project as a means to attain and assert regional and global supremacy.
The $60 billion CPEC was launched in 2013 to improve Pakistan’s road, rail and energy transportation infrastructure besides connecting its deep-sea port of Gwadar with China’s Xinjiang province.
As per News18, the major CPEC projects underway are Bostan Industrial Zone (SEZ) near Quetta, Balochistan; Chaman district of Balochistan bordering with Afghanistan; Gwadar Port, Specially Zone-I & Zone-II; some patrolling units on CPEC’s western alignment which covers hostile areas of Balochistan like Awaran, Khuzdar, Hoshab and Turbat areas; Mohmand Marble City (SEZ) near Mohmand Agency bordering with Afghanistan and Sost Dry-Port & Moqpondass Special Economic Zone Gilgit-Baltistan.
China has previously outlined plans to extend CPEC to Afghanistan under its tripartite diplomatic initiative.
Why is India upset?
India has been consistently been critical of CPEC, which includes a network of highways, rail links, power plants, manufacturing units and massive infrastructure projects, on the ground that the projects are built on territory illegally occupied by Pakistan.
India has also argued that the project has been pushing countries towards a debt trap.
Much like Sri Lanka, Pakistan is caught in a debt trap due to huge investments in CPEC and has been facing down a serious economic crisis.
This, even as Pakistan earlier in July reached an agreement with the International Monetary Fund to revive a $6 billion bailout package.
Pakistan has leased some of its big industrial projects to Chinese firms, which has led to them taking on even more debt – the same vicious cycle that ensnared Sri Lanka.
CPEC has also been criticised for exploiting Pakistan’s natural resources without commensurate benefits to local communities.
As per The Tribune, this is not the first time that Pakistan has solicited third-party investments in CPEC. Its earlier bid to reach out to Saudi Arabia and the UAE did not yield results.
What did India say?
In a sharp reaction, External Affairs Ministry Spokesperson Arindam Bagchi said such activities under the China-Pakistan Economic Corridor (CPEC) are “inherently illegal, illegitimate and unacceptable”, and will be treated accordingly by India.
“New Delhi has consistently been critical of projects in the so-called CPEC projects which are in India’s territory that has been illegally occupied by Pakistan.”
“We have seen reports on encouraging proposed participation of third countries in so-called CPEC projects. Any such actions by any party directly infringe on India’s sovereignty and territorial integrity,” Bagchi said.
“India firmly and consistently opposes projects in the so-called CPEC, which are in Indian territory that has been illegally occupied by Pakistan,” he said.
India is also promoting INSTC as a viable and fairer alternative to the BRI.
New Delhi’s grand geopolitical strategy is motivated in part by the dual goals of challenging and delegitimising China’s BRI in resource-rich regions of the world, including Central Asia and Africa.
West backs India
A slew of Western nations have also backed India’s stand on CPEC.
As per News18, the India-USA Joint Statement ‘Prosperity through Partnership’ released in June 2017 called upon all nations to support bolstering regional economic connectivity through transparent development of infrastructure and the use of responsible debt financing practices, while ensuring respect for sovereignty and territorial integrity, the rule of law and the environment.
The India-Japan ‘Prosperity through Partnership’ released in September 2017 also underlined the importance of all countries ensuring the development and use of connectivity infrastructure in an open, transparent and non-exclusive manner based on international standards and responsible debt financing practices, while ensuring respect for sovereignty and territorial integrity, the rule of law and the environment.
The European Commission issued a Joint Communication in September 2018 titled ‘Connecting Europe and Asia – Building blocks for an EU Strategy’, which highlighted that the European Union promotes an approach to connectivity, which is sustainable, comprehensive and rules-based.
US president Joe Biden and other G7 leaders unveiled ambitious plans to mobilise $600 billion in funding by 2027 to deliver transparent and game-changing infrastructure projects in developing countries like India in a move seen as a counter to China’s BRI.
How has Pakistan responded to India?
Pakistan on Tuesday termed India’s stand as “baseless and misguided” and said attempts to cast aspersions over the multi-billion dollar connectivity corridor show New Delhi’s “insecurity and pursuit of a hegemonic agenda.”
The FO said that “the CPEC is a transformational project and a harbinger of stability, mutual cooperation and shared development for the region.” “As a flagship of the Belt and Road Initiative and hallmark of the Pakistan-China All-Weather Strategic Cooperative Partnership, CPEC provides a vehicle for the people of the region to break from zero-sum approaches,” it said.
China’s investment in CPEC has helped Pakistan overcome the energy and infrastructural bottlenecks that once constrained growth and development, it added.
“Attempts to cast aspersions over CPEC show India’s insecurity as well as the pursuit of a hegemonic agenda that has held back socio-economic development in South Asia for decades,” said the FO.
Rejecting India’s “fallacious assertion” that CPEC impinges on its “sovereignty and territorial integrity”, the Foreign Office said that it is in fact India that is “illegally occupying Kashmir for over seven decades while perpetrating gross and widespread human rights violations”.
Trouble in paradise
CPEC has been causing some friction between the ‘all-weather’ friends.
A report by Pakistan daily Dawn said Yang Jiechi, the director of the Office of the Foreign Affairs Commission of the ruling Communist Party of China (CPC), during a visit pressed for Chinese firms to take over the security of thousands of workers from China employed in dozens of CPEC projects.
The report said all-weather ties “currently appear under deep stress because of growing terrorist attacks on Chinese citizens”.
“Beijing is particularly concerned about the lack of progress in the prosecution of the April 26 attack. It is said that neither the mastermind nor other major actors involved in the attack have been apprehended,” the report said.
“The Chinese had demanded permission for deployment of private Chinese security guards for the protection of Chinese personnel and installations. Though Pakistani authorities did not allow that, the issue remains very much on the table,” it said.
Pakistan in recent months has been witnessing a spate of attacks against Chinese workers employed in projects under the CPEC.
China in July asked Pakistan to “get to the bottom” of the April suicide attack that killed three Chinese nationals at the Karachi University, a day after authorities in Sindh province claimed to have arrested the mastermind and pointed finger at an unnamed “neighbouring country”.
A burqa-clad woman suicide bomber from the banned Baloch Liberation Army (BLA) on 26 April blew herself near a van carrying Chinese nationals outside Karachi University’s Confucius Institute. Three Chinese nationals and their local driver were killed in the incident.
The attack sent shock waves in China as it involved for the first time a woman suicide bomber of the BLA, which is opposed to Chinese investment in Balochistan province.
Last July, masked armed men on a motorcycle opened fire on a vehicle carrying two Chinese nationals in Karachi in which one of them was critically wounded.
In the same month, nearly a dozen Chinese engineers were killed when a bus carrying construction workers was “attacked” in northwest Pakistan.
In November 2018, Baloch militants had attacked the Chinese consulate in Karachi but failed to break through the security barrier with three of them killed on the spot.
Unfinished projects
Meanwhile, Pakistan over the past seven years has completed only three CPEC projects in Gwadar while one-dozen schemes costing nearly $2 billion remain unfinished including those of water supply and electricity.
CPEC remained dormant during most of the time of the previous Pakistan Tehreek-e-Insaf (PTI) government but lately, there had been some progress after the last political regime brought in Khalid Mansoor as special assistant to the PM on CPEC affairs. Yet, he could not take these schemes across the finishing line, reported The Express Tribune.
The big projects under the project were having problems raising the required funds and the completed projects were shut down, a media portal previously reported, adding that the government of Pakistan also abolished the CPEC authority, which was set up for smooth and rapid development.
Chinese companies also stopped generating electricity in CPEC projects demanding payment of arrears.
High-interest rates on CPEC loans, rising project costs, weak projects, and attacks on CPEC infrastructure are major issues in what has become a white elephant dream.
With inputs from agencies
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