• While many have sought to analyse the economic benefits of the China-Pakistan Economic Corridor, it still unclear whether CPEC is primarily a geopolitical project or a trade connectivity route.
• As China invests heavily in the Indian Ocean Region to expand its sphere of influence, such as the Gwadar Port project, both the US and India have sought to curtail China’s expansion to safeguard their economic, strategic, and security interests.
• Political instability in Pakistan and militancy in Balochistan cannot be fully understood without taking into account external factors and regional power politics.

There is a plethora of literature highlighting the benefits of the China-Pakistan Economic Corridor (CPEC) and its impact on people’s living standards. This literature highlights how the corridor has the potential to modernise Pakistan’s infrastructure by improving connectivity within the region and beyond and create numerous economic opportunities. CPEC chalks out a realistic pathway for people of Pakistan that can take them out of poverty. It also offers a constructive opportunity for the unemployed in extremely poor areas such as Balochistan, Khyber Pakhtoonkha, and Gilgit Baltistan (GB), who might otherwise be tempted to join religious, terrorist or extremist mercenaries (such as TTP or IS-K), separatist organisations (such as BLA, BRA, BSO), criminal cartels, and smugglers.

CPEC is a 3,000km-long trade connectivity route consisting of highways, railways, infrastructure, energy projects, special economic zones and oil supply lines. It is a flagship project of the Belt and Road Initiative (BRI) with immense economic potential and geopolitical significance. CPEC is one of the key nodes in the BRI, connecting China’s underdeveloped western province – Xinjiang Uyghur Autonomous Region – traversing through Pakistan from North to South at the Gwadar Port and beyond; entering from Khunjrab pass and running through parts of Punjab, Sindh, Balochistan, Khyber Pakhtunkhwa provinces and Gilgit Baltistan; with its final foot in Arabian sea through Gwadar Port in Balochistan.

As a connectivity route, CPEC significantly cuts down the costs, distance and time involved in trade activity to/from China. The corridor has the potential to connect East and West with China leading the way as an investor. Pakistan provides China with a quick access to the Eurasian region (Europe and Central Asian countries), Middle East and Africa thus transforming the loop into an integrated market of more than a billion people. The question of whether CPEC is primarily a geopolitical project or a trade connectivity route emerges when analysing its benefits. But there is no simple answer to this question.

Although the project is lauded for its catalytic impact on regional economics, it is viewed as a Chinese strategy to assert itself in the international political arena, with Pakistan acting as its peripheral associate. China’s economic rise has bolstered its prowess in global affairs but has simultaneously intensified competition and rivalry amongst the global and regional powers. In pursuit of an influential role in the region, the major players – China, the USA and India – are ambitiously asserting themselves, limiting the space for weaker economies like Pakistan.  Whilst China has found networks for trade through the BRI, India is also expanding its area of influence in the neighbourhood through economic activity in countries such as Iran, Afghanistan and Sri Lanka.

While pursuing their economic objectives in the region, all contestants are considering their broader geostrategic objectives. Strong states in their pursuit of a powerful, dominating, and authoritative role, impact international politics in a way that transcends local power balances. They do not fight each other in a conventional manner but rather orchestrate a scenario that disturbs the local power balance either through dissenters or a third state. These orchestrated scenarios can be seen in countries like Sri Lanka, Myanmar, or Pakistan.

The region was previously under American influence, but now it is moving towards China in pursuit of greater economic benefits. China’s expansion through the major ports in the Indian Ocean under the BRI not only threatens Washington’s pre-eminence in the region, but jeopardises India’s aspirations to be a leader in regional matters.  Geopolitics at a point wherein the interests of strong international actors converge or diverge as in case of CPEC, inevitably creates intense rivalry in the region.

As China invests heavily in the Indian Ocean Region (IOR) to expand its sphere of influence, Washington’s foreign policy is increasingly geared towards curtailing Chinese expansionism. It is no surprise that policy makers in the Washington are facilitating and aligning with India to raise its status.

China and India are competing for a dominant role not only in regional but also in global affairs. Their penetration into their shared neighbourhood through economic activities serves both economic and strategic goals. For example, to counter China’s investment in Gwadar Port, India is funding Chahbahar Port in Iran – less than 80 miles from Gwadar.

Gwadar Port, the jewel in CPEC’s crown, is built to serve as an economic (trade and energy) gateway but is seen as a means of maritime surveillance. Gwadar Port provides China with a westward opening in the Indian Ocean and an alternate route in case its trade and energy activity is scuttled in South China Sea. The strategic prominence of the port and the steady expansion of Chinese maritime interests has created security implications for Pakistan, particularly in Balochistan, wherein the low-level warfare (separatist militancy) is a constant challenge. Pakistan’s continued struggle to control militancy in Balochistan is obstructing the successful completion of the Gwadar Port. Analysing the reasons for violence in Balochistan reveals the involvement of external powers and alludes to an intrinsic desire to keep this region a flashpoint so that China’s expansion can be slowed down if not stopped.

The main stakeholders in the region – the USA, China, Pakistan and India – are actively pursuing influence in IOR to safeguard their economic, strategic, and security interests. With strong US support, Indian hegemonic intentions are transforming into open threats to Pakistan. Indian involvement in Pakistan’s internal affairs and its instigation of violence is not a covert strategy anymore. The Indian Prime Minister, Narendra Modi, has repeatedly asserted his support for Baloch separatists and reaffirmed Indian desire for an independent Balochistan. Indian National Security Advisor, Ajit Doval, is rather more vocal in repeating the Bangladesh secession model in Balochistan and publicly reiterated his intentions on different occasions. The medical treatment of Baloch separatists in Indian hospitals, the arrest of Kulbushan Yadev, a serving Indian Naval Officer from Balochistan, and his subsequent confession ‘to sabotage CPEC project’ are a few examples of Indian active engagement and direct involvement in Pakistan’s internal affairs.

Interference in Pakistan serves India in two ways: to settle its score with Pakistan; and to contain China. As such, we cannot understand political instability in Pakistan and militancy in Balochistan without taking into account external factors and the regional power politics.

Prior to August 2021, both India and the United States had substantial presence in Afghanistan, which served as a check on China’s westward expansion. Using Afghanistan as a militant corridor and providing safe haven for militants and anti-Pakistan groups was a well thought out Indian strategy to keep the western borders engaged. However, after the withdrawal of NATO forces from Afghanistan, and with the Taliban coming into power, India and the USA have had to withdraw from their position. Their absence from western border is not permanent. Both USA and India will not leave this space open for China rather more conflicts are underway.

The current economic meltdown and political crisis in Pakistan is not solely an organic phenomenon but has several external factors. It is clear that CPEC has provided an impetus for fierce competition amongst the USA, China and India in the region. CPEC has pushed Pakistan further into a vortex of instability and crises due to the persistence of regional power politics.

This article gives the views of the author, and not the position of the China Foresight Forum, LSE IDEAS, nor The London School of Economics and Political Science.

The blog image, “Khunjerab pass CPEC“, is licensed under CC BY-SA 4.0.