ABSTRACT
This chapter reviews the progress of the China-Pakistan Economic Corridor (CPEC) since its formal inauguration in April 2015, with focus on four key areas of cooperation, namely, energy, infrastructure, the Gwadar Port and industrialisation, including the establishment of Special Economic Zones (SEZs). Over the years, cooperation between China and Pakistan has expanded to agriculture, livestock, maritime sector and human resource development. Despite initial challenges, the CPEC has moved forward. Most of the projects under early harvest were completed while progress on mid-to-long term was observed as satisfactory. The mutuality of interests ensured the smooth implementation of the project. China’s investment boosted Pakistan’s economy, expanded Pakistan’s connectivity, enhanced its regional standing and attracted investment from other sources. China gained various political, economic and strategic advantages. The CPEC can provide China with a suitable alternative to the Strait of Malacca, complement China’s modernisation of its Western region, and connect Xinjian’s economy to the outside world, thus contributing to its stability. Gwadar Port can support China’s geo-economic interests in the Indian Ocean. Major challenges to CPEC include Pakistan’s internal politics, terrorism, lack of transparency and regional and global geopolitics. On the whole, the CPEC has made positive progress. It has the potential to become a real game changer for Pakistan.
