(MENAFN- KNN India) China has announced a $46bn investment plan which will largely centre on an economic corridor from Gwadar in Pakistan to Kashgar in the Chinese region of Xinjiang.
Experts say this will create jobs and spark economic activity in Pakistan which over the last three decades has become a cranky, rent-seeking military power torn by armed insurgencies and a failing system of service delivery.
"This is Pakistan's first opportunity since the 1960 Indus Water Treaty to change its economic geography," according to an economist in Pakistan.
The money China is planning to invest is more than twice the amount of all foreign direct investment (FDI) Pakistan has received since 2008, and considerably more than the entire assistance from the United States, Pakistan's largest donor until now, since 2002.
This investment will be heavily concentrated in the China-Pakistan Economic Corridor (CPEC), a combination of transport and energy projects and the development of a major deep-sea port offering direct access to the Indian Ocean and beyond.
For the Chinese, the corridor has a geo-strategic significance. The corridor through Gwadar gives them their shortest access to the Middle East and Africa, where thousands of Chinese firms, employing tens of thousands of Chinese workers, are involved in development work.
The corridor also promises to open up remote, landlocked Xinjiang, and create incentives for both state and private enterprises to expand economic activity and create jobs in this under-developed region.
China could also be trying to find alternative trade routes to by-pass the Malacca straits, presently the only maritime route China can use to access the Middle East, Africa and Europe. Apart from being long, it can be blockaded in times of war.
This may be the reason China is also pursuing an eastern corridor to the Bay of Bengal, expected to pass through parts of Myanmar, Bangladesh and possibly India. (KNN/DB)
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.