The China-Pakistan Economic Corridor (CPEC): Feasibility and the Need for an Assessment of India's Role

Abstract

The China-Pakistan Economic Corridor CPEC, a multi-billion dollar infrastructure investment project, is heralded as a game changer for Pakistan’s economy and regional cooperation. Being a crucial part of a major development initiative led by China, known as ‘One Belt, One Road’ (OBOR), to connect Asia with Europe, the Middle East and Africa, the CPEC is much linked to hopes, interests, as well as regional and global geopolitics. However, such a megaproject raises numerous questions especially regarding the feasibility of its implementation, the impact on the region as well as the nature of India’s position towards the endeavour.

To begin with, one should shed some light on Pakistani and Chinese interests: First, Pakistan is in urgent need for major investments to boost its flailing economy. Second, Islamabad is looking to diversify its foreign aid and investment. In this context, it is obviously keen on reducing its financial dependence vis a vis the US. Third, Pakistan expects to expand the build-up of its infrastructure, deepen energy capacities, and manufactural hubs, improve the living conditions in its poorer provinces, reduce unemployment, increase know how, and reverse negative processes of brain drain and capital flight.

Keywords: South Asia, Regional Cooperation, China-Pakistan Economic Corridor, CPEC, India, Pakistan

JEL Classification: N90, O10, O11, O18, P25, P48, R10, R11, R12, R13