China Pakistan Economic Corridor (CPEC): Challenges and the way forward

Abstract

The China-Pakistan Economic Corridor (CPEC)--the latest venture in a history of bilateral economic cooperation, with a $46 billion investment in energy and infrastructure development in Pakistan--is considered a game changer for Pakistan's economy. As a flagship project of China's One Belt One Road initiative, the corridor will connect Kashgar in Western China with the port of Gwadar in Pakistan on the Arabian Sea, serving as a gateway to the Middle East, Africa, and Central Asia. The CPEC, in addition to boosting Pakistan's economy and meeting China's energy needs and development of its western region, is likely to bring stability in the region through economic integration. Nonetheless, a project of such scale certainly faces equally significant challenges. This thesis examines obstacles that have the potential to affect the implementation of the project, including the unstable situation in Afghanistan, competing interests of immediate neighbors like India and Iran, especially India's suspicions, and U.S. concerns about the initiative. The thesis draws from a wide range of scholarly and peer-reviewed literature, academic journals, think-tank reports, and government-sponsored studies. Missing from their analysis, though, is the consideration of the regional geopolitical dynamics and Pakistan's domestic challenges, particularly insecurity and violence that can affect the implementation of the CPEC project. This thesis seeks to address that gap and provides policy recommendations for Pakistan to deal with potential impediments in implementation of the project.