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AFP / SAM PANTHAKY (Photo credit should read SAM PANTHAKY/AFP/Getty Images)
The China-Pakistan Economic Corridor (CPEC) is changing life in China’s Northwest Xinjiang Uyghur region, bringing something special to the region: seafood from Pakistan.
This little bonus is being shipped by container trucks through the corridor, which currently accounts for 2 percent of the total trade between the two countries; and more goods are expected to come through CPEC from the Middle East and Africa.
That’s certainly a good return for China’s enormous investment in the project, which some experts call the Marshall Plan for Pakistan.
“The China-Pakistan Economic Corridor (CPEC) has been described as a Marshall Plan for Pakistan,” says Marko Dimitrijevic author of Frontier Investor. “It is a $51 billion, 15 year project that will ultimately create a 2,000 kilometer highway/railway/pipeline route from Western China to Pakistan’s Gwadar Port, knocking over 10,000 kilometers off the current sea route for Middle Eastern oil to China; a high-speed railway from Karachi to Lahore to Peshawar; and over 26,000 MW of electric generating capacity.”
CPEC is part of China’s ambition to write the rules of the next stage of globalization and help Beijing sustain growth—a good prospect for investors in Chinese equities, which have been lagging behind those of neighboring India over the last five-year period.
But China’s enormous investment in CPEC serves much more than trade. It advances Beijing’s “String of Pearls” strategy, as well as its strategy to encircle India through its arch-rival, Pakistan.
“Besides having investments that have purely commercial goals in Pakistan as they would in any other country the Chinese have two main goals in investing in that particular country,” explains Dimitrijevic. “First is to continue the “String of Pearls” strategy of developing commercial and military outposts along their main maritime trading route. These include the Strait of Malacca, Sri Lanka, Pakistan, the Maldives, the Strait of Hormuz and Somalia.
There is a second reason for the Chinese to invest and that’s to make India feel China’s strong presence in its neighbor and arch-rival Pakistan.”
The trouble is that CPEC passes through Pakistani regions claimed by India. That makes it a bumpy road, to say the least -- Pakistan and India continue to fight for control of these regions, which may end up spoiling China’s ambitious plans