The Belt and Road Initiative aims to connect countries in Asia, Europe and Africa and their adjacent sea areas. Although this is a global project, it mainly targets countries in Central Asia, Eastern Africa, Eastern Europe and the Middle East. It will develop and strengthen partnerships between these countries through integrated connectivity networks and independent and sustainable development.

The focus of cooperation under the Belt and Road Initiative includes policy coordination, facility interconnection, unimpeded trade, financial integration, and human-to-human ties. It intends to jointly formulate development plans to promote regional cooperation through intergovernmental cooperation, multi-level macro policy exchanges, exchange networks and coordination of monetary policy.

China-Pakistan Economic Corridor, the jewel in the crown of the Belt and Road Initiative

The China-Pakistan Economic Corridor (CPEC) is the crown jewel of the Belt and Road Initiative, as it will provide the shortest route to Central Asia, Africa, the Middle East and Europe through the deep sea Gwadar Port. A research report published by Khalid Mehmood Alam in the Advanced Transportation Journal compares China's existing trade routes from Kashgar to Shanghai ports, to the Middle East and Europe, and the proposed CPEC route through Gwadar Port. The study estimates that from Kashgar via the CPEC route (ie Gwadar Port) to destination ports in the Middle East and Africa, the cost of a 40-foot container will be reduced by approximately US$1,450, while the destination port in Europe will be reduced by US$1,350. In addition, travel time will be reduced by 24 days and 21 days respectively. It is estimated that the distance will be reduced by 11,000 to 13,000 kilometers.

CPEC will revive the ancient Silk Road, the oldest trade route before the Han Dynasty in China. The Silk Road connects China and Britain through the Indian subcontinent, Asia Minor, Africa, Greece and Rome. Although CPEC is a bilateral project, its benefits will be spread to different regions. It will easily enter the cheap Chinese market through Gwadar Port.

Pakistan has been given countless natural gifts, and most importantly, its highly strategic geographical location will make it a hub for international trade and connectivity. Pakistan is the gateway to the Central Asian Republic and Afghanistan. It is understood that the Central Asian countries are approaching Pakistan, requesting it to facilitate trade in Gwadar and Ben Qasim seaports. As a result of the operation of transshipment of bulk cargo from Gwadar to Afghanistan, Afghanistan has benefited from the strategically located Gwadar port.

In a recent webinar held by the Center for Global and Strategic Studies of the Iranian Ambassador to Pakistan, His Excellency Said Mohamed Ali Husseini emphasized: “Iran-Pakistan-China cooperation is a positive three under the Belt and Road Initiative. Border cooperation provides opportunities. Financial and other forms of cooperation have development potential." CPEC will provide Iran’s oil and gas resources with a new path to China.

Despite the interference caused by the new crown epidemic, CPEC not only implemented as outlined, but also appeared to have accelerated after the establishment of the CPEC Authority in October 2019. Since the appointment of Lieutenant General, Lieutenant Asim Saleem Bajwa has served as CPEC Chairman. Authoritative, CPEC-related activities have been promoted, which can be from the PC-I mainline I approved by ECNEC, the second phase of operation of KKH, the PC-I of M-6 (Suk-Hyderabad part), signed 1,124 Concession agreement for the megawatt Kohala HPP and 701 MW Azad Pattan HPP, the 1,320 MW and 660 MW Engro Thar power plants in China’s central hub began to generate electricity, the Gwadar Smart City master plan was approved, the foundation stone of the Alama Iqbal Industrial City was laid, and the Rashakai Special Economic Zone was signed Development agreements, and major developments in many socio-economic fields, agriculture and Gwadar-related projects.

After overcoming important energy and other infrastructure-related deficits, the second phase of CPEC focuses on industrial cooperation, agricultural development and other socio-economic related projects aimed at improving the lives of local people. It is planned to carry out industrial cooperation under CPEC to transfer foreign industries with advanced technology to improve domestic manufacturing capacity. Natural resources, skilled and cheap labor, the best infrastructure, easy access to international markets, and investor-friendly investment policies will help Pakistan attract foreign investment in the CPEC special economic zone.

These special economic zones provide various attractive financial and non-financial incentives for developers and local and foreign companies. In order to improve the investment environment in Pakistan, many reforms have been carried out. The World Bank’s Doing Business 2020 report has ranked Pakistan as the sixth largest reformer in South Asia and the world.

Chinese and other foreign companies can transfer their industries and not only benefit from attractive incentives and business-friendly investment policies, but also from Gwadar's warm water deep sea port to benefit from huge market access. CPEC has common prosperity not only in Pakistan and China but also in the entire region. CPEC is the flagship project of BRI's six corridors, and it will usher in a new era of regional connectivity and development.

CPEC plays a key role in the development of the Belt and Road Initiative because it reduces transportation costs and time. It will provide important loops for various sea and land routes near Gwadar Port.Editor/Luo Wentao