China’s $62 Billion Bet on Pakistan

Letter From Gwadar

A container is loaded on to the Cosco Wellington, the first container ship to depart after the inauguration of the China Pakistan Economic Corridor port in Gwadar, Pakistan, November 13, 2016. Caren Firouz / Reuters

When Maqbool Afridi, now a retired colonel, was stationed with the Pakistani army in Gwadar in the 1990s, he would sit along the coast and stare into the expanse of the Arabian Sea, imagining what the natural deep-sea port could become. He was inspired not only to write romantic Urdu poetry but also to purchase some land in what was then, and largely remains, a fishing village. His family ridiculed him for it, telling him that he was wasting his savings.

Today, Afridi’s venture seems prescient. Beijing has made the Gwadar port the centerpiece of the China-Pakistan Economic Corridor (CPEC), a series of Chinese-financed energy and infrastructure projects in Pakistan totaling upward of $62 billion in aid and investments. CPEC, according to Chinese officials, is a “flagship project” of the Belt and Road Initiative, Beijing’s massive push to create a unified economic corridor that runs through Eurasia and into Africa. A top goal is to connect the landlocked western Chinese city of Kashgar to the Arabian Sea via Gwadar, providing China an alternative route for shipping gas and oil, one that would bypass the southern tip of India and the Strait of Malacca, a chokepoint that could make China’s maritime trade vulnerable to interdiction by hostile states during a conflict.

CPEC is certain to benefit China’s troubled state-owned enterprises, allowing them to overcome the challenges of overcapacity and oversupply by going global. And for Pakistan, the project could help it quickly overcome deficits in its electric supply and revive its struggling domestic industries, positioning it for high rates of economic growth.


CPEC’s biggest feat may very well be the port of Gwadar. Although Gwadar poses little to no threat at this time to Dubai’s Jebel Ali, the region’s premier container port, in five to ten years, Gwadar’s Chinese operators could position Gwadar as a niche but effective transshipment hub just outside the strategic Strait of Hormuz. A remarkable achievement it

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