NEVER has a scheme been peddled to the people in Pakistan’s past as a game changer the way the China-Pakistan Economic Corridor was. The government is optimistic about asphalt carpet roads, electricity schemes and special economic zones worth $60 billion. The $19bn early harvest programmes have been completed, and the CPEC is now in its second phase, where much of the projects will be based on a model of public-private collaboration.
For now, in their first step, the schemes have failed to usher in the degree of progress promised to the people. It is therefore imperative to ensure that CPEC projects are used in an optimal manner and, therefore, there is a need to extend its reach to neighbouring countries, especially Afghanistan.
Pakistan and China have already spent immense resources in the development of the CPEC road system. $11bn will be spent on the building of roads and highways, according to projections. However, if Pakistan does not connect the CPEC to other countries in the region, it would not be able to gain the full economic benefits and ensure the financial viability of the infrastructure.
In addition, Pakistan already had a road network, which may not have been as bright as CPEC, but definitely helped to connect various parts of the nation. A parallel road infrastructure will look good for the eyes, but with the heavy transport industry, it will not gain momentum as it often suggests more fuel and toll costs.
Linking the corridor to Afghanistan would be to Pakistan’s benefit.
A good data point for understanding how un-optimized highways can be harmful to the economy is the M2 highway between Lahore and Islamabad. It took more than seven years to construct the motorway, at a cumulative cost of around $1.2bn. Despite this, the chosen route for commercial transportation to date is the GT Lane, which saves heavy transport fuel and toll costs. The motorway has not seen a massive rise in freight traffic even after more than 20 years of construction; rather, it has just contributed to Pakistan’s international debt service obligations. Regional connectivity would mitigate the danger of other deadweight projects, including the M2 motorway, in addition to growing trade.
Pakistan has recently announced that it will build trading points with Afghanistan on the border it shares. While this is a promising move, this project can only be successful if these trade points are linked to major highways and motorways. Pakistan’s share of intra-regional trade has fallen to 7.4 percent of its overall overseas exports, according to estimates, down from 12.2 percent in 2011. Likewise, Pakistan’s regional imports have declined from 7.4pc to 4.7pc of its overall global transactions. Connecting CPEC to regional countries, beginning with Afghanistan, may be a gradual process. Afghanistan seems to be the most viable country to expand CPEC, considering its obstacles.
In addition, owing to historical and cultural ties, Pakistan and Afghanistan’s destinies are intertwined. Pakistan will not achieve economic growth without peace and prosperity in Afghanistan. Afghanistan will need to diversify its economy with the US pulling out of the region, as the existing $8.5bn funding from the West is also expected to dry up.
Pakistan is also interested in the development of the Torkham to Jalalabad highway. The reasonable next step is to further expand this highway to Kabul. China has also stated that it will be open to investment in road infrastructure and energy projects if the Afghan Taliban will enter into a peace agreement with the Afghan government.
Boosting the port of Gwadar is another justification for expanding the CPEC to Afghanistan. Pakistan is failing to get foreign business traction for the port. The construction of the port of Gwadar was slower than Pakistan had envisaged. So far, because of improved logistics facilities, foreign freight companies tend to berth their ships at the two ports in Karachi. The Gwadar-Chaman motorway will be a lucrative freight route and would greatly reduce the time it takes for freight from Pakistan to enter Afghanistan.
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Though there are different explanations for expanding CPEC to Afghanistan, before this can become a possibility, there are many obstacles. One of the main problems is getting the requisite buy-in from all of Afghanistan’s relevant stakeholders. In addition, China-U.S., Pakistan-U.S., and even India-Pakistan ties would be crucial in linking CPEC to Afghanistan.
At the end of the day, if it wishes to improve regional cooperation, Pakistan would have to bring all players on board, which is good for both Pakistan and Afghanistan.
The writer is a graduate of the University of Oxford and the Middlebury Institute of International Studies.