The biggest obstacles to China’s plans lie in the dysfunction and incompetence of Pakistan’s governing structures.
Over the decades during which I have worked in and written about Pakistan, there have been so many supposed national “turning points” at which the country failed to turn that I have almost ceased to notice them.
But when earlier this year the Pakistani Government described China’s planned energy and transport corridor through Pakistan to the Arabian Sea as a “fate changer”, it may – perhaps – have been telling the truth.
At more than $46bn, the planned Chinese investment in this project is some four and a half times the total US economic aid to Pakistan since 9/11 (though admittedly largely in the form of low-interest loans).
Apart from energy pipelines and road-and-rail links between western China and the Pakistani port of Gwadar, the plans include massive investments in Pakistan’s own energy, transport and telecommunications infrastructure, including what would be the world’s largest solar power generating complex at Bahawalpur.
These projects, if realised – and this is a very big if – have the potential to bring in tens or even hundreds of billions of dollars in additional investments. They could restore Pakistan’s economic growth of the early 1960s, which led economists at the time to predict that the country would be one of the future leading economic powers of Asia.
This dream was lost when Pakistan recklessly attacked India over the Kashmir dispute in 1965, and Zulfiqar Ali Bhutto subsequently abandoned free market policies in favour of a horribly corrupt and badly managed populism.
China’s commitment to the core energy and transport aspects of the plans does not seem in much doubt. This corridor will be a key part of Beijing’s “One Belt, One Road” strategy, intended to link China by land with Europe, Southeast Asia and the Middle East.
|[W]hile Beijing certainly regards Pakistan as a potential strategic ally against India, it has also brought strong influence to bear on Pakistan not to back attacks against India, and to seek a reduction of tension with Delhi.|
This strategy is driven both by economic interests and security concerns. China depends on imports for 60 percent of its oil, and the great majority of this is carried by tanker across the Indian Ocean and through the Strait of Malacca.
Beijing sees this as rendering China dangerously vulnerable to pressure from India and the US, as well as to attacks from fighters.
Security obstacles in Pakistan have greatly diminished in recent years thanks to the successful offensives of the Pakistani army against the Pakistani Taliban rebels. These offensives were supported – at last – by a united Pakistani public opinion.
The separatist rebellion in Balochistan – where the port of Gwadar is situated – remains a threat, but so far its military capacity has been very limited. It would only increase radically if India decided to increase its support for the rebels via Afghanistan with the deliberate aim of blocking the Chinese corridor.
Apart from being extremely dangerous and irresponsible in itself, such an Indian strategy would lead to a breakdown in both diplomatic relations and trade with China. That would be a very unwelcome development as both the Indian National Congress and current Bharatiya Janata Party governments in recent years have tried to improve these relations.
Fears have been expressed in India about the ways in which this new Chinese corridor would both strengthen Pakistan and increase China’s geopolitical and economic influence in the region.
It is important to note, however, that while Beijing certainly regards Pakistan as a potential strategic ally against India, it has also brought strong influence to bear on Pakistan not to back attacks on India, and to seek a reduction of tension with Delhi.
China certainly does not favour either international terrorism or a new security crisis in South Asia. Ideally, therefore, future Indian leaders might come to see an Indian interest in seeking reconciliation with Pakistan so as to link up with the Chinese corridor and open land routes for India to the Middle East and Europe.
|Chinese President Xi Jinping (C) with Pakistan’s President Mamnoon Hussain (L) and Prime Minister Nawaz Sharif on display in Islamabad [AP]|
This would require, among other things, serious work on a consensus between Delhi, Islamabad, Beijing and Washington on how to seek a peace settlement in Afghanistan.
The biggest obstacles to China’s plans lie not in strategic threats but in the corruption, dysfunction and incompetence of Pakistan’s governing structures, and the culture of patronage which dominates Pakistani politics.
Thus in the area of transport, Pakistan railways are a shambles compared with those of India, though the two countries inherited the same systems at independence. Pakistan International Airlines has been in crisis for years, above all because – as with state-owned banks and industries – politicians (and generals when in power) have used it as a source of patronage and stuffed it with their relatives and supporters. This has led to the grotesque figure of 776 PIA employees per aircraft, one of the highest rates in the world.
Pakistan needs a huge outside investment in infrastructure in part because of its own chronic inability to raise taxes. At barely 10 percent of GDP, Pakistan’s tax-collection rates are among the lowest in Asia. Pakistan suffers chronic electricity shortages in part because it cannot get the population to pay its electricity bills.
It does not have to be this way. Under President Ayub Khan in the late 1950s and early 1960s, a combination of a relatively honest, dynamic and far-sighted administration with plentiful US aid (above all for infrastructure, as with China’s plans) and sound international advice led to Pakistan achieving some of the highest rates of economic growth in the world.
If Chinese money and Chinese influence can return Pakistan to those rates of growth, then this will not only help to stabilise Pakistan and create a barrier to violence there. It will also mark China’s arrival as a truly great – and positive – force on the world stage.