The Epic China Pakistan Economic Corridor Pact (CPEC)

8 min


The idea of China Pakistan Economic Corridor (CPEC) was first presented at the Institute of Strategic Studies in Islamabad. A Chinese diplomat named Zhao Lijian first gave an enlightening presentation on it. Li Keqiang is the current Premier of the State Council of China and an economist. He officially visited Pakistan in May 2013. That is when the project was formally conceived.

Later, the then elected Prime Minister of Pakistan, Mr. Nawaz Sharif made multiple visits to China to discuss the importance of this mega project. President Xi Jinping visited Pakistan in April 2015. Where he then, formally announced China’s intentions and visions about the CPEC.

A number of countries and companies, both Chinese and non-Chinese, are allowed to participate in these projects. It has an open and international bidding theme in a transparent manner. The companies which are encouraged to participate include:

  • Japanese
  • Korean
  • Singaporean
  • Malaysian
  • Arabian
  • Iranian
  • Russian
  • American
  • European
  • Asian and
  • Australian



So, What Exactly is CPEC?

Last year, the Chinese government committed to build this corridor. It is basically a transformative project. The 3,200km corridor is under construction. It connects China’s north-western city of Kashgar to the Gwadar Port in southern Pakistan. The corridor serves as a primary gateway for trade between China, the Middle East and Africa. It will include the construction of highwaysrailways and natural gas and oil pipelines.


The project will cover sub-projects in different sectors such as Energy and Transportation. This is expected to improve Pakistan’s economy in the coming years. Also, it will be stabilizing the employment opportunities simultaneously.

The CPEC Projects

According to different sources, a grand total of US $46 billion or $54 billion has been invested in the project so far. Nevertheless, the figures might rise with time.

In addition, the Energy sector has 21 projects lined up so far. Many other projects are to be carried out in the Gwadar city specifically. Furthermore, the Cross Border Optical Fiber Cable & Pilot Project of Digital Terrestrial Multimedia Broadcast is also expected to be completed.


CPEC is mainly being considered as an economic booster. It will help to raise the economic growth of Pakistan. The enhancement of geographical links having improved road links, industrial parks, power projects, rail links and fiber optics are the prominent features of this visionary economic corridor. It can also benefit and unite all the ethnic groups in Pakistan.

CPEC Railway Projects
CPEC Railway Projects

Besides that, Gawadar would not be only dependent on the port itself. An international airport construction would commence later in December 2017China will grant Pakistan $230 million for its construction. The provincial government of Balochistan has set aside 4000 acres land for this. The Gwadar International Airport will require an estimated 30 months for its construction.


How All This Will Bring A Change

CPEC is an ongoing development project. It is mutually beneficial for both Pakistan and China. China’s proposed 21st century Silk Road initiative will prove to be a game changer. Investments emerging through attractive avenues will also improve economic cooperation between the two rising powers of Central Asia.

The 'Game Changer'
The ‘Game Changer’

Furthermore, CPEC will have positive impact on the region. Countries such as Iran, Afghanistan, India and Central Asian Republic can also benefit.

The president of China, Xi Jinping said, “To build a China-Pakistan community of shared destiny is a strategic decision made between the two governments and its people. Let us work together to create an even brighter future for China and Pakistan.”


The Investment & Employment Opportunities

CPEC will also provide investment opportunities in various sectors such as:

  • Industrial Cooperation
  • Financial Cooperation
  • Agricultural Cooperation
  • Tourism
  • Educational linkage
  • Human resource development
  • Health Care
  • Increase in livelihood opportunities
  • Enhanced Security and stability of the region


The combined value of the CPEC’s infrastructure projects would be equivalent to 17 percent of Pakistan’s GDP in 2015. A report estimated that the economic corridor would create some 700,000 direct jobs between 2015 and 2030.

Pakistan’s GDP is expected to grow by more than 6% by 2020, according to an IMF growth forecast. PricewaterhouseCoopers (PwC) predicts that Pakistan’s GDP will reach $4.2 trillion by 2050 from the current $988 billion. Simultaneously, China is projected to become the world’s largest economy by 2050. It will reach a GDP of $58.5 trillion, from the previous $5.7 trillion, in 2010.

How Does CPEC Concern India?

The fact that the route passes through the disputed Kashmir region seems to have worried India. It has about half a million troops stationed in its part of Kashmir. Additionally, India is claiming that “China is using Indian land area which has been illegally occupied by Pakistan.”

China, on the contrary, has answered to India’s concern. They are committed to develop friendly relations with all the countries. Thus, it has promised that CPEC will not affect China’s position on Kashmir.

After the 1962 India-China war, Beijing sought to cultivate good relations with Pakistan. We have emerged as the biggest buyer of Chinese defense equipment in the recent years. China has no intentions to be involved in the Kashmir issue. Nonetheless, history is just disturbing India at the moment.

Further, it has been made clear that nothing is going to stop CPEC from happening. India is quite stable economically. Witnessing Pakistan undergoing a massive turn around will definitely cause it discomfort. However, Pakistanis are determined to do what’s best for their country. 


So this is all for now. CPEC is a vast topic and we at Daily Punch have brought the most important updates to you. Keep watching this space for more updates!

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