A Crash Course in the History, Geography and Economics of CPEC

A Crash Course in the History, Geography and Economics of CPEC

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CPEC
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In the last one year there has been an on-going debate about the China-Pakistan Economic Corridor (CPEC). People have developed their pros and cons lists and both sides have put forward some important arguments.

However, I’ll refrain from siding with either side and instead, simply list down some facts that I’ve gathered to understand what all the hullabaloo is about.

1. One Belt, One Road

CPEC is part of China’s grand vision, known as One Belt, One Road (OBOR), which essentially focuses on creating a road network that extends from the Baltics in Europe to South East Asia and from China to Africa. The road transverses all the countries in between!

2. Historical Background

The total area covered by CPEC is 3000km. This encompasses a network of roads, railways and pipelines to transport oil and gas from Gwadar port to Kashgar city in northwestern China’s Xinjiang Uygur autonomous region.

The project was first proposed by former President General Pervez Musharraf. However, owing to political instability in the country not much could come out of it.

The idea resurfaced in 2013 during Chinese Premier Li Keqiang’s visit to Pakistan.

However, it wasn’t until November 2014 that the project was formally announced.

3. Expected Economic Impact on Pakistan

The economic corridor amounts to a whooping budget of $54 billion USD. The road network is likely to impact Pakistan’s economy by rapid construction of improved road, rail and air transportation system with frequent and free exchanges of growth and people to people contact, activity of higher volume of trade and businesses, rapid construction of modern transportation infrastructure, establishment of special economic zones and augmented power generation capacity.

4. Significance of Gwadar Port in CPEC

Gwadar Port is among the most prized aspects of CPEC. The Port is strategically located between South Asia, Central Asia and West Asia at the opening of the Persian Gulf. As part of CPEC, Gwadar Port was officially leased to China for 43 years; the lease will end in 2059.

Also Read – Gwadar: Fifty Shades of Development

Depth of the Port

In this regard Port Jebel-Ali (UAE) with a depth of 9 meters is among the most sought out ports in the region. Other important ports include Bandar-Abbas (depth 9 meter, in Iran), Dammam (depth 9 meter, Saudi Arabia), Doha (depth 11 meter, Qatar), Salalah (depth 10 meter, Oman) and Chabahar (depth 11 meter, India). 

On the other hand the depth of Gwadar port is 18 meters. If Jebel Ali has played such a huge role in shouldering the bulk of UAE’s economic growth with a depth of only 9 meters, imagine the potential of Gwadar with its 18 meters’ depth.

Number of Births

When it comes to the number of births Jebel-Ali has 67 births, Bandar-Abbas has 24 births, Dammam has 39 births, Doha has 29 births, Oman Salalah has 19 births, Chabahar has 10 births and Gwadar has 120 births. The comparison here is self-explanatory.

Efficiency of Gwadar Port

As China’s economy is oil dependent, China consumes 10.3 million gallons per day of which 51% is imported through Middle East. This means that China spends about $400 million daily to meet its oil demand!

Here it is important to understand that about 82% of the imported oil goes through the states of Malacca, taking approximately 3 months and 2 weeks to reach Shanghai.

On the other hand if this oil comes through Kashgar or Gwadar port  to China it will only take 28 days. This makes Gwadar Port a much more lucrative option for China than Jebel Ali or other Middle Eastern ports.

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