Such concerns were heightened when, on 23 May 2016, Indian Prime Minister Narendra Modi, Iranian President Hassan Rouhani and President Ashraf Ghani of Afghanistan signed a three-way transit agreement on Chabahar. India would invest up to $500 million to develop the port and both countries planned several projects worth hundreds of millions of dollars.65 Not only would the agreement take economic cooperation between the three countries to a new level but, as the Iranian president put it, the three-way accord ‘… was not merely an economic document but a political and regional one’.66
Three other developments have heightened Pakistan’s concerns. In October 2017 India flagged off a shipment of wheat for Afghanistan through Chabahar, marking the operationalization of the port for the trans-shipment of goods from India to the landlocked country. This signalled that Afghanistan would no longer be dependent on Pakistan’s Karachi port alone for trade and India could now bypass Pakistan in transporting goods to Afghanistan. Second, in February 2018 India and Iran signed a short-term lease of the first phase of Shahid Beheshti Port at Chabahar.67 Under the agreement, Iran leased a part of the port for eighteen months to India to take over operations of existing port facilities in the first phase of the port development project. India has committed $85 million for the development of the Shahid Beheshti Port. Third, Afghanistan began exports to India through Chabahar port on 24 February 2019. As per reports, twenty-three trucks carrying fifty-seven tonnes of dry fruits, textiles, carpets and mineral products were dispatched from the western Afghan city of Zaranj to Chabahar port.68
In Pakistan, the ‘alliance between India, Afghanistan and Iran’ was seen as a ‘security threat’. It was feared that such a bloc would affect Pakistan’s plans for regional economic integration, restoration of internal peace and maintenance of peaceful borders as also the CPEC timelines. Some advocated that the recipe ‘to break out of this encircling move’ was Pakistan formalizing its defence and strategic relationship with China rather than keeping it unwritten.69
Pakistan’s worry is threefold. First, it is concerned that as and when Chabahar port and the road/rail link to Afghanistan and beyond gets operationalized, the floodgates could be opened for Indian investment in Afghanistan. It would also improve transport connectivity and economic collaboration of India with countries in Central Asia. Second, this sea–land link allows India to bypass Pakistan and have direct access to Afghanistan, something that Pakistan has so far prevented. Likewise, it provides landlocked Afghanistan an alternative route to the outside world instead of relying solely on the whims of Pakistan. This worries Pakistan as it could be the first step in Afghanistan shaking off its dependence on its neighbour. Third, Pakistan’s worry is that its ‘all-weather friend’ China could hedge its bets on the CPEC script. The state-run Global Times stated, ‘There is no reason for jealousy in China about a milestone deal signed between India and Iran.’ It further held that India can promote infrastructure development that will be conducive to economic development in the entire region.70 Chinese prime minister Li Keqiang followed this up by stating that the projects (Chabahar and Gwadar) have the potential to complement each other in boosting the otherwise sluggish economies of the region and that China did not see the development of Chabahar as an attempt to undermine the Gwadar project or CPEC.71
Overall, the simultaneous development of Gwadar and Chabahar has caught the imagination of commentators and is projected as a contest in the Arabian Sea representing long-standing rivalries in the region that would lead to geostrategic competition.72
12
The China–Pakistan Economic
Corridor
THE CHINA–PAKISTAN ECONOMIC CORRIDOR (CPEC) has been described as a ‘game-changer’ for Pakistan. Even the army chief Gen. Qamar Javed Bajwa has described CPEC in grand terms: ‘This corridor is not just a collection of infrastructure and power projects—it is in fact a complete development platform that has the potential to act as a powerful springboard for shared development in the entire Central Asia–South Asia region,’ he said, during his prepared remarks at a function in Karachi in October 2017.1
The moot question is whether it would be a game-changer for Balochistan too. Would it transform the lives of the people of Balochistan and would it be the panacea for their economic ills?
Three factors are relevant here. First—discounting for the moment doubts as to whether Balochistan is on the route of the corridor and if so, whether the route will be in phase I or II—the route will pass through only a portion of the province. It is, thus, unlikely to be a game-changer for the province. Second, as mentioned previously, there is no certainty that it will be the people of Balochistan who will be employed in the implementation of the corridor. In the past, the Baloch were passed over in mega projects like the Saindak copper–gold project, the Reko Diq project and the Gwadar port project. So, will CPEC be any different?2
Third, Gwadar is the critical element of the CPEC. Without an outlet from Gwadar, the CPEC will be a non-starter. And here lies the rub—as noted in the previous chapter, the Baloch have been alienated by the manner in which the development of Gwadar is taking place. The elected representative for Gwadar in the Balochistan Assembly is, for example, not convinced that the benefits of the huge investments that are planned for the people of Gwadar will actually accrue to them. He has admitted that he has not been taken on board regarding the various agreements and has gone as far as to say that it almost seems like there is a plot afoot to convert the local population into a minority in their own area. Likewise, the elected chairman of the Gwadar Municipal Committee has also complained that the opinions of local leaders and of the people of Gwadar have been disregarded in recent CPEC–related decisions. Meanwhile, the residents of Gwadar lack basic facilities like access to clean drinking water, adequate educational institutions, healthcare, and suffer prolonged power outages. The BNP-M chief Akhtar Mengal put his finger on the nub of the matter when he said that the success of CPEC was linked to the support of Baloch people.3
What Will CPEC Do?
According to the Economic Survey of Pakistan 2016-17, projects under the CPEC portfolio are broadly categorized into ‘early harvest’ projects with completion by 2018 and short- and medium-term projects, which are aimed for completion by 2020 and 2025 respectively. The intention is also to take the initiative forward under the CPEC long-term plan. The sectors of cooperation include, but are not limited to, agriculture, energy, infrastructure development in rail and road networks, development of Gwadar as a modern port city, establishment of industrial parks and improving IT connectivity through optical fibre.4
Out of the $21 billion worth of ‘priority energy projects’, there is only one project in KPK (worth $1.8 billion) and two in Balochistan (worth $1.3 billion), accounting for 8.5 per cent and 6 per cent, respectively, of the total investment categorized as ‘priority’.
There have also been claims by the authorities that the debate on the installation of energy projects in any specific province is futile as electricity generated anywhere will be injected into the national grid and will be available for all the provinces without any discrimination.5 This would be true only if all provinces had been fully connected to the national grid. At present, large swathes of rural Balochistan, FATA and KPK are not connected to the national grid. For instance, only 25 per cent of Balochistan’s population has access to electricity compared to 75 per cent in the rest of the country. The existing transmission lines are weak and old and unable to sustain the additional power burden. As mentioned earlier, the peak electricity demand in Balochistan is around 1,800 MW while the transmission lines cannot carry more than 650 MW. So even if there is surplus electricity, large areas of Balochistan, owing to non-connectivity to the national grid and inadequate transmission capacity, are unlikely to benefit.
For the Sharifs (the then prime minister Nawaz Sharif and the then Punjab chief minister Shahbaz Sharif) there was an urgency to complete the ‘early harvest’ projects before the elections in 2018. Not
surprisingly, the bulk of the projects was planned in Punjab and Sindh. Out of the $28.6-billion early-harvest projects, Punjab had the lion’s share of $13 billion, Sindh $4.6 billion, KPK $1.8 billion, Islamabad $1.5 billion and Balochistan $920 million. However, by almost ramming home the projects, there was a grave danger that the mistrust the smaller provinces had with Punjab and their insecurities vis-à-vis the federation would get aggravated. Unless the smaller provinces, especially Balochistan and KPK, are given a sense of ownership, the CPEC may damage Pakistan rather than be the ‘game-changer’ it is billed to be. An ominous warning has been sounded by political economist Pervez Tahir: ‘It would do us well to remember that investment in East Pakistan was also considered unsafe for security reasons. What are the planners of today driving the smaller provinces to?’6
Route Controversy
Gwadar is not the only bone of contention as far as the Baloch are concerned. The other contentious issue is the route of the CPEC from Gwadar to Kashgar in China. The original proposal envisaged a route through Balochistan and KPK. The government of Nawaz Sharif that came to power in 2013 tweaked the route to make it pass through Punjab instead. This caused a huge uproar and ‘route controversy’ became a contentious issue between the federal government and Punjab on the one side and Balochistan and KPK on the other. For these provinces CPEC is increasingly turning out to be a ‘China–Punjab Economic Corridor’. This is both because the bulk of the projects has been cornered by Punjab and because the route runs through the length of Punjab and, at least in the first stage of CPEC, bypasses Khyber Pakhtunkhwa completely and most of Balochistan (except the coastal areas from Gwadar to Karachi).7
The shortest route from Gwadar to Kashgar runs through Panjgur, Quetta, Zhob (all in Balochistan), Dera Ismail Khan (KPK) and then into Punjab through Mianwali on to Islamabad and then the KKH to Xinjiang. This was also the route that was presumed to become the main CPEC artery and hence enthused the people of Balochistan and KPK who saw in it a potential to uplift areas that have until now been neglected and were underdeveloped.
In February 2014 the first reports emerged that the route had been changed. By March 2014 Baloch senators were raising objections over plans to change the route to cover Punjab and Sindh and leave the bulk of Balochistan out. The new route would also add an additional 400 km to the CPEC. By June 2014 the ‘route change’ had become official. Ostensibly, it was done because the original ‘western route’ went through very restive areas and from the point of view of security, the Punjab–Sindh route—‘eastern route’—was considered much safer. That Punjab was the pocket borough of the Sharifs and their Pakistan Muslim League-Nawaz and that there were rich political and financial dividends to be gained from routing the CPEC traffic through Punjab was a very important consideration with the Nawaz Sharif government.8
There was also the issue of funding. The ‘original route’ was shortest but would also take a lot more money and time to build. According to the then CPEC point-man, Minister for Planning Ahsan Iqbal, the funds for the western route would have to come from inside Pakistan because the Chinese had refused to finance it. Later, he revealed that the Chinese wanted access to Gwadar within two years and this could only be possible if the eastern route was built first.9
With time the route controversy snowballed into a major one. Even as government officials claimed that the route had been changed on the request of the Chinese ambassador, the envoy himself told a leading politician that the decision on the route was taken by the Pakistan government. Senators from Balochistan and KPK not only threatened to hold protest demonstrations in front of the Chinese embassy and in front of parliament but also threatened to resign because all their concerns were falling on deaf ears in the government. Some senators even went to the extent of warning that Pakistan wouldn’t remain united if the route was changed.
In the face of rising anger, the government clarified that there would be not one but three routes—western, central and eastern—connecting Gwadar to Kashgar.10 However, to get the project up and running in the earliest possible time, the eastern route would be operationalized first by upgrading existing infrastructure. But this logic was faulted on the grounds that once the eastern route became operational, it would develop its own logic and dynamic. This would either prevent the other routes from being developed, and if developed, then they would remain underutilized and the spin-offs expected in terms of industrial and other economic activity that were to accompany the transport corridor would not happen. After both the Khyber Pakhtunkhwa and Balochistan assemblies passed resolutions against any change in the route, Chinese officials were forced to step in and issue clarifications that the so-called original route wasn’t ever agreed upon by both China and Pakistan. According to the Chinese, only a single route, based on detailed feasibility studies, had been agreed upon and there was no change in that alignment.
With the routes becoming politically controversial, the government was forced to call an All Parties Conference (APC) in May 2015 to evolve a consensus on the issue. After some hectic back-room convincing by Ahsan Iqbal, during which he wooed the dissenting politicians from the smaller provinces by announcing projects that would be coming up in their provinces, the government managed to get a go-ahead. Strangely enough at the APC, Prime Minister Nawaz Sharif declared that the western route would get priority and would be constructed first!11 He had either not been briefed or, quite possibly, not understood the ramifications of the briefing.
Within days it became clear that the assurance given by the prime minister that the western route would get priority was an eyewash. The allocations for the western route were about a fifth of those made for the eastern route. There was an immediate uproar and the Senate Standing Committee on Finance demanded an explanation for what was described by one senator as ‘political fudging’.12
Barely had the project got off the ground, reports about large-scale corruption started emerging. For example, two of the four highway projects in Balochistan inaugurated by the prime minister as part of the CPEC were awarded to the second lowest bidders instead of the lowest ones, causing a loss of over Rs 650 million. The reasoning for rejecting the lowest bidder was unsatisfactory. There were also reports about CPEC projects being billed at much higher costs than originally planned due to Chinese companies not following competitive bidding processes.13
Another example of the deception carried out was the inauguration with much fanfare of the ‘Western route of the CPEC’ by PM Nawaz Sharif at Zhob on 30 December 2015. A day later it was revealed that the two projects inaugurated were actually funded by the Asian Development Bank (ADB) as per an agreement signed in May 2015 and not through CPEC. As a journalist put it: ‘In short, prime minister deceived people and political leaders of Balochistan by terming the ADB projects as CPEC funded projects … by using ADB funds for highways in name of CPEC, PML-N government is depriving Balochistan of its due share in CPEC funds for infrastructure development, which is condemnable.’14
The former chief minister of Balochistan Abdul Malik Baloch’s Policy Reform Unit, headed by economist Kaiser Bengali, came up with a report on 25 June 2015 titled ‘China–Pakistan Economic Corridor: The Route Controversy’. The report stated that by preferring a route that passes through Punjab and Sindh rather than KPK and Balochistan, the federal government was failing to take into account the needs and desires of all federating units of the country and was trading off today’s security risks against provincial discord and political instability in the future.15 According to this report, the eastern alignment would artificially inflate the cost of the project in terms of cost of land acquisition, displacement of population, socio-economic benefits and environmental impact.
One shameful result of the wrangling and discord over CPEC was the unprecedented intervention by the Chinese embassy in Islamabad on 9 January 2016: ‘We hope that relevant parties could strengthen communication and coordination, solve differences properly so as to create favourable conditions for the CPEC. W
e are ready to work with Pakistani side to actively promote construction of the CPEC projects, and bring tangible benefits to the peoples of the two countries.’16
A study that carried out a comparative cost–benefit analysis of the two routes showed that prioritizing the western route was a better option. The arguments were:
1) The western route was the shortest; 2) the costs of land acquisition and dislocation compensation were much lower along the western route compared to the eastern route; 3) many bridges would have to be built on the eastern route compared to the almost negligible number on the western route given that the former passes through rivers and canals; 4) the eastern route was vulnerable to floods in monsoon and had the ‘fog’ problem in winter; 5) the development of the western route would help create new growth centres and reduce the economic burden on the relatively developed big cities, thus putting a limit on existing patterns of migration; 6) the marginal return on investment in terms of improvement in living standards would be much higher on the western route compared to the eastern route; 7) security costs would be lower along the eastern route but that was offset by the interprovincial discord and weakening of federal integrity that may result from the current design of the CPEC; and 8) strategically, development of the western route would mean the addition of a safer communication line compared to the eastern route, which was closer to the Indian border and therefore vulnerable in case of an attack.
Pakistan- the Balochistan Conundrum Page 21