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Pakistan's Belt and Road port has Singapore-size goal

Nikkei.com

BELT AND ROAD


Gwadar's development plan, with a lack of funds and resources, stirs skepticism

There are plans to make the port city of Gwadar, near the Gulf of Oman, into a smart metropolis of 2 million, but the city's 85,000 current residents already struggle with poor electricity and water supplies.   © ReutersISLAMABAD -- Pakistan's Gwadar Smart Port City Masterplan has raised eyebrows among economic experts because of the massive amount of resources it will cost financially strapped Pakistan.

Gwadar Port is a major part of the China-Pakistan Economic Corridor, or CPEC, which for China is an essential part of its Belt and Road Initiative.

The masterplan was approved at CPEC's 9th Joint Cooperation Committee meeting in November. It was developed by the Fourth Harbor Design Institute at a cost of 521 million Pakistani rupees ($3.3 million). The FHDI is a Chinese engineering and design company.

The complete text of the masterplan has not been made public, and only limited information about the salient features is available on the website of the Gwadar Development Authority, the body responsible for implementing the plan. The project has been shrouded in mystery despite demands from journalists and experts to release it in its entirety.

"Why does everything relating to CPEC have to be a mystery?" asked an official who does not want to be named, who also said it is "beyond comprehension" why the government does not make data related to the project public.

According to the limited information shared on the GDA's website, the population of Gwadar city will increase to 2 million by 2050, the year when the masterplan ends, from 85,000 now. According to the plan, Gwadar Smart Port City will have seven ecological corridors, 11 urban functional zones and a special economic district to attract foreign capital. The planned development area is approximately 1,200 sq. km.

Pakistani media have published reports on what life might be like in the city once the masterplan is implemented. There have also been stories about an artificial island costing $10 billion to be built under the plan, but the GDA later contradicted these reports.

According to details published by The News, the per capita income of Gwadar will reach $15,000 -- nearly ten times that of national average now -- and its economy will surpass $30 billion by 2050. In addition, Gwadar Smart Port City is to become Pakistan's third-largest city and create 1.2 million jobs, according to the newspaper. 

Shahzeb Khan Kakar, director general of the GDA in a meeting with a group of builders called Gwadar the future "Singapore of Pakistan."

Gwadar is on the other side of India from Singapore and sits at a crucial spot on the geopolitical map -- along the eastern end of the Gulf of Oman. On the other end of the gulf is the Strait of Hormuz, a choke point through which 21% of global petroleum supplies travel.

The GDA last week lifted a ban on development activities in Gwadar in a bid to promote development.

Experts are skeptical about how the governments of Pakistan and China can finance the project, which will require more than 100 billion Pakistani rupees for basic infrastructure alone.

Katharine Adeney, a professor and director of the University of Nottingham Asia Research Institute, believes that huge levels of investment will be required. "This investment will have to be spent before international companies will be persuaded to locate their businesses there," she told the Nikkei Asian Review. "In the current economic climate, this may be controversial."

Adeney was surprised that the plan did not emphasize renewable energies more. "Pakistan faces a huge challenge from climate change," she said, "and building a city from scratch presents a unique opportunity to build in these technologies rather than relying on coal power."

Gwadar locals interviewed by Nikkei say they are happy about the proposed developments but are baffled as to how they can be financed. Gwadar has been in the spotlight since 2002, when China started building the port. Eighteen years later and the city lacks basic infrastructure.

Currently, Gwadar relies on spotty electricity from Iran (the city is about 80 km east of the Iranian border). A 300 megawatt coal-fired power plant planned under the CPEC is two years away from being functional. The city is also facing a water supply crisis, and some of its 85,000 citizens are skeptical that water can be supplied to the envisioned 2 million inhabitants of the future.

Mohan Malik, a professor of strategic studies at the National Defense College of United Arab Emirates, agrees with the notion that the Gwadar plan is overly ambitious. The masterplan, he said, "is unrealistic unless and until both the Chinese and Pakistani governments make Gwadar's development their No. 1 priority for the next couple of decades."

Malik believes that given Pakistan's resource crunch and fractured politics -- not to mention China's economic slowdown, especially in the aftermath of the coronavirus -- it is highly unlikely that Beijing and Islamabad will be able to come up with the resources required for the masterplan anytime in the near future.

The Gwadar megaproject is considered by some experts as a game-changer, at least for the city's inhabitants. Professor Adeney said the ambitious plan has the potential to provide much needed employment in Gwadar. She believes it can only succeed if the government ensures that the local communities benefit from the employment opportunities.

Malik, however, is less optimistic. He said the idea that Gwadar Smart Port City will outdo Dubai as a modern urban center and a trade hub, on the other side of the Strait of Hormuz, seems like pie in the sky. "It's nothing," he said, "but a huge public relations exercise for the foreseeable future."

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