Chinese Interests in Developing Gwadar: Economic Benefits for Pakistan

Abstract

With the increase in Chinese outward foreign direct investment (FDI), policy makers in Beijing had to rethink their foreign policy options. One of the best options for them was to initiate the idea of One Belt One Road (OBOR) in order to revive ancient Silk Routes to facilitate the outward FDI. One part of OBOR passes through Pakistan in the shape of China Pakistan Economic Corridor (CPEC). Gwadar being located strategically at a very important sea trade routes juncture was a great opportunity for China to connect Xinjiang to the Persian Gulf and the Middle East. Gwadar is not only a natural deep sea port but also provides China with the shortest land route to the Middle East. Pakistan being a developing country is in dire need of FDI. Developing Gwadar as an international port would not only generate an increased economic activity within Pakistan but also in landlocked Afghanistan and Central Asia as well.Since Gwadar is located in Baluchistan province which is the poorest region of Pakistan with least physical infrastructure, this port will provide an opportunity to develop this region in special. Chinese firms are really interested to explore the natural resources especially coal, gold and tin of Baluchistan which will definitely bring change in the lives of Balochis. Physical infrastructure development in the form of CPEC will connect the scattered population of Baluchistan with rest of country. This port will also provide great opportunity to other states which do trade with Gulf States.