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China-Pakistan Energy Corridor By Brig (Retd) Asif Haroon Raja

China-Pakistan Energy Corridor

Asif Haroon Raja

 

 

 

 

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Establishment of China-Pakistan Economic Corridor (CPEC) was first proposed by Chinese Premier Li Keqiang during his visit to Pakistan in May 2013. Li stated, Our two sides should focus on carrying out priority projects in connectivity, energy development and power generation”. At that time, Pak-China bilateral trade had reached $12 billion. The proposed project of linking Kashgar in northwest China with Gwadar Port on southwestern Arabian Sea coastline in Baluchistan was approved on July 5, 2013 during the visit of PM Nawaz Sharif to Beijing, which included construction of 200 km long tunnel. In December 2013, China committed $6.5 billion for the construction of a major nuclear power project in Karachi. In May 2014, another agreement was signed to start Orange Line metro train project in Lahore worth $1.27 billion. In November 2014, the two countries signed 19 agreements related to CPEC. In addition, Chinese firms started work on six mega power projects in Gilgit-Baltistan such as Dassu, Phandar, Bashu, Harpo, Yalbo to tackle Pakistan’s energy crisis.  

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Originally scheduled to come on September 14-16 last year, China’s President Xi Jinping’s visit was postponed in the wake of prolonged anti-government protests in Islamabad and security concerns, and the government not wanting anything untoward happening. Postponement of the visit was seen by the government as a big setback since it entailed investment of $26 billion in Pakistan. Onus of postponement was squarely put on the shoulders of those indulging in futile dharna politics. This setback was not an ordinary one when seen in the backdrop of worst ever energy crisis, economy in shambles, state corporations in decay and all economic indicators in negative – thanks to the inglorious five-year rule of PPP led coalition. Cash-strapped Pakistan struggling to finance energy projects from western donors couldn’t afford a single day delay.

Operation Zarb-e-Azb which started in mid June 2014 in North Waziristan after the brazen terror attack on Jinnah airport in Karachi and peace talks having fallen apart was put in top gear after the gruesome tragedy in Peshawar Army Public School on December 16, 2014. Its scope was spread all over the country and cooperation with Afghanistan was greatly improved. Rangers-Police intelligence based targeted operation in Karachi was also speeded up and so was Frontier Corps-Police operation in Baluchistan. These efforts were backed by National Security Policy, Counter Terrorism Policy, Joint Intelligence Directorate to coordinate efforts of 33 intelligence agencies, formation of Counter Terrorism Force at federal and provincial levels, lifting of moratorium on hanging of convicts, setting up of military courts and focussed 20-point National Action Plan, all in a bid to eliminate the scourge of terrorism.

Brilliant successes against terrorism and extremism, which raised the stature of Pak Army backed by air force very high among the international comity, helped in further enhancing the confidence of China’s leadership in Pakistan. Well aware of Indo-US encirclement plan and shifting of Ameica’s pivot to Asia-Pacific to contain China, the latter wanted an early opening into world market to become an unchallenged economic giant as well as the super power. Mindful of the under developemnt of its western province which is its soft belly and ongoing Uighur movement, China wants speedy modernisation of Xingjiang to bring it at par with eastern provinces. For the accomplishment of these dreams, China needs access to warm waters in Arabian Sea through Gwadar since this route is the shortest and the cheapest. This access was never granted to Russia. With this objective in view, President Xi Jinping undertook a visit to Islamabad and pleasantly surprised the Pakistanis by raising the level of investment from $ 26 billion to $ 45 Billion in Pakistan.

Pakistanis opened their hearts to welcome the worthy guest. During his two-day historic visit (April 20-21, 2015), President Xi signed 51 agreements/MoUs worth $28 billion, with $17 billion in pipeline spread over 15 years. His visit achieved the milestone of the groundbreaking of historic 3,000 km-long strategic China-Pakistan-Energy-Corridor (CPEC). It includes $ 18 billion worth energy projects such as coal, solar, hydroelectric power projects which will inject 10,400 MW electricity in the national grid by 2017/18, laying down fibre optic cable from Xingjiang to Rawalpindi, 1240 km long Karachi-Lahore motorway, metro and bus service in six major cities, up gradation of 1300 km long Karakorum Highway (first opened in 1978), oil/gas pipelines, commercial sea-lanes and host of other projects.

The CPEC project will include building new roads, a 1,800-km railway line and a network of oil pipelines to connect Kashgar in China’s western Xinjiang region to the seaport of Gwadar. It includes a string of energy projects, special economic zones, dry ports and other infrastructure. China is helping Pakistan in producing plutonium at Chinese built Khushab reactor and will also sell 8 submarines worth $5 billion, which will give a quantum jump to Pak Navy’s sea capability.

Gwadar, once a part of Oman before it was sold to Pakistan in 1958, is one of the least developed districts in Balochistan province. It sits strategically near the Persian Gulf and close to the Strait of Hormuz, through which 40 per cent of the world’s oil passes. Work on Gwadar deep-seaport had started in 2002 with China’s investment. In 2013, management of the seaport which was in the sloppy hands of Singapore PSA International was handed over to China’s Port Holdings. It is planned to develop Gwadar into free trade zone with a modern airport on the model of Singapore or Hong Kong and a gateway to CPEC. Some analysts perceive Gwadar port turning into China’s naval base in the Indian Ocean, enabling Beijing to monitor Indian and American naval activities and thus frustrating their ambition to convert the ocean into exclusive Indian lake. Modernization of Pak Navy by China is seen as a step in that direction.

 

 

Energy-poor Pakistan certainly seems to have found a saviour in China, which has promised to stand by the country in its dark hour (parts of the country suffer power cuts for up to 18 hours a day). Jubilant President Mamnoon Hussain predicted that the economic corridor will be a “monument of the century” benefitting “billions of people” in the region. Analysts believe that the CPEC has the potential to radically alter the regional dynamics of trade, development and politics. They say the projects conceived under CPEC will ease Pakistan’s energy shortages and make a substantial difference in the long term with both generation and transmission covered. Some experts opine this initiative can bring greater cohesion in South Asia, one of the world’s least economically integrated regions. Adil Najam, Dean of the Boston University Pardee School of Global Studies, believes anything that binds the region together is “a good idea” since countries tend to focus on “zero-sum geostrategic posturing” rather than recognising the benefits of integration. MNA Ahsan Iqbal says “CPEC is a game changer for the entire region and will uplift the lives of about 3 billion people across China, Central Asia, South Asia and the Middle East.

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While the CPEC may be ‘monumental’ for Pakistan, for China it is part of more ambitious plans to beef up the country’s global economic muscle. Chinese officials describe the corridor as the “flagship project” of a broader policy — “One Belt, One Road” — which seeks to physically connect China to its markets in Asia, Europe and beyond. This initiative includes the New Silk Road which will link China with Europe through Central Asia and the Maritime Silk Road to ensure a safe passage of China’s shipping through the Indian Ocean and the South China Sea. China is not building the corridor as an act of charity for Pakistan. It will happily fund and build any structure that plays into this goal – whether we’re talking about roads or ports”,  says Michael Kugelman, a senior associate at the Washington DC based Woodrow Wilson Centre. Access to Indian Ocean via Gwadar will enable China’s naval warships and merchant ships to bypass Malacca Strait.    

 

 

 

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At the same time, the new silk roads are bound to intensify ongoing competition between India and China –and to a lesser extent between China and the US – to invest in and cultivate influence in the broader Central Asian region. Kugelman stated, India has long had its eyes on energy assets in Central Asia and Afghanistan, even as China has gobbled many of these up in recent years. The US has announced its own Silk Road initiative in the broader region. India is concerned about China’s huge investment in Pakistan, particularly its recent decision to fund a new batch of nuclear reactors. Pakistan plans to add four new nuclear plants by 2023, funded by China, with four more reactors in the pipeline (adding up to a total power capacity of 7,930 MW by 2030). India and other detractors of Pakistan are propagating that China is supplying nuclear technology to Pakistan in defiance of the Nuclear Suppliers Group (NSG) guidelines, which forbid nuclear transfer to Pakistan as it has not signed the Nuclear Nonproliferation Treaty. China argues that these projects were agreed with Pakistan before it became a member of NSG in 2004.

Pakistan has remained under a dark star for a long period; it has bravely sailed past the period of trials and tribulations but at a very heavy cost. Pakistan has acted as the frontline state against the Soviets and against global terrorism and suffered enormously, but in the process it allowed China 35 free years to develop and prosper. Landmark CPEC has further cemented Pak-China relations and made them natural allies. China’s liberal investment which surpasses all foreign investments in Pakistan in the past are based on trust, confidence and convergence of interests and both are in a win-win cooperation. The all-weather, time-tested friends share common vision and seek peace and not confrontation. They have entered into a new era of geo-economic relationship and plan to boost two-way trade to $20 billion.

The Silk Road Economic Belt will not only connect and develop China and Pakistan but also the regional countries for the first time and promote peace. It has opened vista of great opportunities for Pakistan and will greatly help in poverty alleviation, overcome unemployment, remove inequities of smaller provinces and help Pakistan in becoming the next Asian tiger. Strategic economic moment for Pakistan has arrived and interesting part is that Pakistan has assumed the position of economic pivot for the whole region. This paradigm shift in circumstances is a cause of great worry for the enemies of Pakistan both within and outside. They have put their heads together to work out new strategies how to block the forward march, but time and tide is not in their favor.  

The writer is a retired Brig/defence analyst/columnist/author of five books, Member Executive Council PESS, Director Measac Research Centre, Director Board of Governors TFP. asifharoonraja@gmail.com

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 

 

 

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US-India-Israel-Iran Sabotage Axis of Evil : Major Challenge to Pak-China Alliance

                                        It is of particular attention, that Indian former Army Chief Gen. VK Singh openly admitted that during his tenure, he supervised special army unit, Tactical Support Division (TSD) on the instructions of the then defence minister to sponsor acts of sabotage in Pakistan, particularly Balochistan.

 

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Major Challenge to Pak-China Alliance

                                                          By 

Sajjad Shaukat

 

It is noteworthy that during his visit to Balochistan, Chief of Army Staff Gen. Raheel Sharif on April 15, this year warned foreign forces and spy agencies against destabilizing Pakistan by supporting insurgents in Balochistan. Gen. Raheel elaborated, “Army will continue supporting the Balochistan government till terrorism is wiped out…those found involved in funding and facilitating terrorists will be dealt with iron hands.”

 

During the historical visit of the Chinese President Xi Jinping to Pakistan, on April 20, this year, he and Pakistani Prime Minister Nawaz Sharif signed 51 agreements for cooperation in various fields, related to China-Pakistan Economic Corridor (CPEC), energy, infrastructure, agriculture, research, technology, education etc.

 

The establishment of CPEC between deep Gwadar seaport of Balochistan and the historic Silk Road city in western regions-Xinjiang of China will connect Gilgit-Baltistan through Khunjerab Pass. Beijing would also build an international airport at Gwadar, while the roads infrastructure in Gwadar would link the communication network of rest of the country to facilitate transportation of goods.

 

When Gwadar seaport becomes fully operational, it would connect the landlocked Central Asian states with rest of the world. Being the commercial hub, the port is likely to increase volume of trade, bringing multiple economic and financial benefits to Pakistan like the Suez Canal which changed the destiny of Egypt when Israel returned it to the former. It will enable high-volume cargo vessels to move in the major oceans. Gwadar project will not only uplift the impoverished people of Balochistan by providing thousands of employment opportunities and is likely to develop whole the province by redressing their grievances. The resulting prosperity in the province would trickle down to the Baloch people and damp the separatist sentiments, which the hostile elements, supported by anti-Pakistan powers do not want.

 

Recall, when during the Musharraf regime, Islamabad initiated the construction of Gwadar deep-seaport in Balochistan in March 2002 with Chinese assistance, sirens went off in the capitals of foreign countries, especially the US, India and Israel which took it as a threat to their global and regional plans.

 

Located on the southwestern coast of Pakistan, Balochistan’s Gwadar seaport is close to the Strait of Hormuz from where more than 17 million barrels of oil passes every day. Its ideal location among three key regions, South Asia, the oil-rich Middle East, and oil and gas-resourced Central Asia has further increased its strategic significance. Its development has shifted the Great Game of Central Asia to Pakistan. Hence, sirens still continue alarming in the foreign countries.

 

Besides, Balochistan’s abundant mineral resources like gas, coal and gold, entailing Pakistan’s close ties with China also pinches the eyes of the US, India, Israel and some western countries which intend to destabilize Pakistan for their collective aims.

 

Therefore, major challenge to Pak-China strategic alliance is that with the tactical support of American CIA and Israeli Mossad, Indian RAW has continuously been assisting the Baloch separatist groups and Baloch Sub Nationalists to conduct subversive acts—and using terrorist elements in Balochistan to threat Pak-Chinese interest in the development of China-Pakistan Economic Corridor. And, Afghanistan has become a hub from where external secret agencies have been funding and arranging subversive activities in other parts of Pakistan—especially in Balochistan through their affiliated militant groups at the cost of Pakistan, China and Iran. In the past few years, they abducted and killed many Chinese and Iranian nationals in Pakistan.

 

It is of particular attention, that Indian former Army Chief Gen. VK Singh openly admitted that during his tenure, he supervised special army unit, Tactical Support Division (TSD) on the instructions of the then defence minister to sponsor acts of sabotage in Pakistan, particularly Balochistan.

 

As regards the deteriorating situation of Balochistan, everyone knows that Balochistan Liberation Army (BLA) and their affiliated outfits including another group, Jundollah (God’s soldiers) which have been fighting for secession of the province gets logistic support from RAW and other anti-Pakistan spy agencies—these militants kidnapped and killed many innocent people and the security personnel in the province. They also massacred many persons through suicide attacks, bomb blasts, targeted killings and sectarian violence. Therefore, they are responsible for dumped bodies and extrajudicial killings in the province. On a number of occasions, these insurgent groups claimed responsibility for their subversive acts. The main aim behind is to create unrest in Balochistan and to discourage Beijing for the development of Gwadar port.

 

While, in May, 2013, a day before Chinese Premier Li Keqiang arrived in Islamabad; Chinese engineers being driven through Clifton Block-1 in Karachi escaped a major bomb attack. Taking note of the foreign powers’ anti-Pakistan designs, during the visit of Chinese President Xi Jinping, Islamabad made extraordinary security arrangements.

 

It is notable that a Gallup survey of the UK official body, DFID, conducted on July 20, 212, had disclosed that the vast majority of the Baloch people oppose the idea of an independent Balochistan.

 

As a result of the general elections 2013, the government led by the nationalist leader Chief Minister Balochistan Dr. Abdul Malik Baloch was established in Balochistan, while on December 7, 2013; local bodies elections were largely held in a peaceful manner in the province. These elections proved that majority of the Baloch are loyal to the federation, and have rejected the case of separatists, being projected by external forces which are weakening Pakistan by supporting the anti-state elements in Balochistan.

 

It is noteworthy that during his visit to Balochistan, Chief of Army Staff Gen. Raheel Sharif on April 15, this year warned foreign forces and spy agencies against destabilizing Pakistan by supporting insurgents in Balochistan. Gen. Raheel elaborated, “Army will continue supporting the Balochistan government till terrorism is wiped out…those found involved in funding and facilitating terrorists will be dealt with iron hands.”

 

In fact, Gen. Raheel Sharif was compelled to expose conspiracy against Pakistan after the gunmen killed 20 laborers in Turbat district of Baluchistan in the deadliest attack on April 11, who were working at a dam construction site.

It is worth-mentioning that during China’s visit, Gen. Raheel Sharif, on January 25, 2015, China’s Vice Chairman of Central Military Commission Gen. Fan has assured that China will assist Pakistan in every challenge.

 

Nevertheless, foreign entities shall pose a major challenge to Pak-China strategic alliance through terror-acts. Hence, the intelligence agencies and security forces of both the countries must be well-prepared to cope with these elements.

 

It is noteworthy that during his visit to Balochistan, Chief of Army Staff Gen. Raheel Sharif on April 15, this year warned foreign forces and spy agencies against destabilizing Pakistan by supporting insurgents in Balochistan. Gen. Raheel elaborated, “Army will continue supporting the Balochistan government till terrorism is wiped out…those found involved in funding and facilitating terrorists will be dealt with iron hands.”

Sajjad Shaukat writes on international affairs and is author of the book: US vs Islamic Militants, Invisible Balance of Power: Dangerous Shift in International Relations

 

Email: sajjad_logic@yahoo.com

 

 

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The Pakistan-China strategic partnership

 

The Pakistan-China strategic partnership

Courtesy: Dr. Rashid Ahmad Khan, China.org.cn

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The leaderships of Pakistan and China realize the need to provide a solid base to already strong Pakistan-China friendship that goes beyond bilateral trade and economic cooperation and promotes cultural relations and people-to-people contacts. 

 

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The leaderships of Pakistan and China realize the need to provide a solid base to already strong Pakistan-China friendship that goes beyond bilateral trade and economic cooperation and promotes cultural relations and people-to-people contacts. Prime Minister Syed Yusuf Raza Gilani’s recent visit to China and his address at Taihu World Cultural Forum are clear pointers in this direction.

Pakistan-China friendship derives its strength from shared common interests in promoting peace, development and stability in the region and adherence to the principles of sovereign equality, mutual respect, mutual benefit, cooperation and non-interference in each other’s internal affairs. Despite having the world’s largest population and its second largest economy, China has never treated Pakistan as its junior partner. During the last two decades, China’s profile as a world power has risen phenomenally. Its relations with the United States, Japan, and European Union, and even with India, have broadened dramatically. But China has never allowed its relations with other countries to affect its friendship with Pakistan.

Pakistan was the first Muslim, and the third non-communist, country to accord diplomatic recognition to China in 1951. Since then, bilateral relations between Pakistan and China have continued to grow, encompassing defence, security, trade, economic cooperation, energy, infrastructure, water management, mining, agriculture, education, transport, communications, science and technology.

China replaced the United States as Pakistan’s principal source for arms and weapons when Washington imposed military sanctions on Pakistan in 1965 and 1990. China has assisted Pakistan in developing its nuclear and conventional defence capabilities which have enhanced Pakistan’s strength in South Asia’s strategic balance. When the United States imposed sanctions against Pakistan in 1990 because of its nuclear weapons development program, China supplied Pakistan with military hardware including 34 short-range ballistic missiles. Recent sales of Chinese conventional weapons to Pakistan include JF-17 aircraft along with production facilities, F-22P frigates with helicopters, K-8 jet trainers, T-85 tanks, F-7 aircraft, small arms and ammunition.

According to latest reports, Pakistan is seeking to buy 36 J-10 aircraft, which would make Pakistan the first recipient of one of the most advanced weapon systems in China’s arsenal. The addition of 36 J-10 aircraft would enable Pakistan Air Force (PAF) to raise two fighter squadrons and further sharpen its combativeness. The sale of the J-10 aircraft signals the depth of Pakistan-China strategic partnership. This partnership reflects close cooperation between the two countries in high-tech production and joint defence projects. The mainstay of China-Pakistan joint defence production is the Pakistan Aeronautical Complex in Kamra, where servicing, assembly and manufacturing of fighter and trainer aircraft is carried out.

China has also built a turnkey ballistic missile manufacturing facility near Rawalpindi and helped Pakistan develop the 750 km range solid-fueled Shaheen-I ballistic missile. Pakistan and China have also signed an agreement under which China will construct four submarines for Pakistan Navy. A significant aspect of China’s military aid is that it involves the transfer of technology to Pakistan.

With Chinese help, Pakistan has built two nuclear reactors at Chashma, and during President Zardari’s first visit in 2008, China pledged to help Pakistan construct two new nuclear reactors at Chashma. The two nuclear power plants will generate 640 megawatts of power and will help overcome the critical energy crisis in Pakistan. The project is a part of Government of Pakistan’s Vision 2030, which includes plans for generating 8000 megawatts of power from nuclear plants.

 
 

Pakistan and China share a rare unanimity of views on regional and international issues and the two countries enjoy a robust relationship in the defence, political and diplomatic fields. However, the extent of relationship in these areas is not reflected in economic and commercial ties.

Realizing the need to expand trade and economic relations, the two countries have taken initiatives to promote cooperation through investment and joint projects. As a result, economic cooperation between Pakistan and China has shown spectacular progress during the last 10-15 years. Between 2000 and 2010 the volume of bilateral trade grew sevenfold. The two sides plan to increase trade to $10 billion within five years. But that is still far below the potential figure. Currently Chinese companies are working on 250 projects in Pakistan. Some of these are mega projects jointly undertaken by Pakistan and China, including the Thar coal project, the Bhasha Dam, the widening of Karakoram Highway, the Gwader deep sea port and the Saindak gold and copper project.

During Chinese Premier Wen Jiabao’s recent visit to Pakistan, he was accompanied by 260 Chinese business executives. During the visit the two sides concluded deals worth $35 billion. The agreements covered the energy sector, bilateral trade, exploration of natural resources and development of the agriculture, livestock, finance and banking sectors. An important achievement of Premier Wen’s visit was the signing of a MoU between China’s Three Gorges Corporation and Pakistan’s Alternative Energy Development Board for a joint venture on wind power and solar energy projects. The Joint Statement issued at the end of Premier Wen’s visit talked of the determination to “enhance their strategic coordination, advance pragmatic cooperation and work together to meet challenges in pursuit of common development.”

One of the most significant signals of long term strategic partnership is the Gwader deep sea port built with Chinese technical and financial help. Gwader lies at the mouth of the Persian Gulf – the source of 40 percent of the world’s oil. The port will allow China to secure oil and gas supplies from the Persian Gulf and project its power in the Indian Ocean. China has financed 80 percent of the $300 million cost, and is also funding the construction of a rail-road network connecting China with the port through Central Asia and Pakistan, turning Pakistan into an energy and trade corridor for China. The oil and gas supply line through Pakistan is a safer, shorter and cheaper alternative route to the Malacca Straits, which is vulnerable to attacks by pirates and passes through a region dominated by the United States. The importance of Gwader for China can be gauged from the fact that China is the largest consumer of oil after the United States. Its consumption is expected to double by 2025 with 70 percent coming from the Middle East and the Persian Gulf. Gwader offers the closest access point to these regions for China. Gwader will provide an overland energy corridor to the western Chinese region of Xinjiang, shortening the journey by 12000 miles. The route will also bring substantial benefits to Pakistan, making it one of the region’s largest energy players. According to one estimate, Pakistan will be earning $60 billion a year in transit fees in 20 years time.

There is vast potential for deepening the Pakistan-China strategic partnership. The current trends in relations show a greater focus on promoting cultural exchanges, people-to-people contacts, and expanding trade and investment ties and economic cooperation. This will, in turn, further strengthen the security and defence links between the two countries, which are a firm guarantee for peace and security in the region.

Dr. Rashid Ahmad Khan is a professor and chairman of the Department of International Relations/Political Science and also dean, Faculty of Arts, Social Sciences and Law, University of Sargodha-Pakistan.

 

 

 

 

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GEOSTRATEGIC IMPERATIVES OF THE GWADAR PORT

 

Introduction

GEOSTRATEGIC IMPERATIVES OF THE GWADAR PORT

 

String of Pearls

1. China is helping Pakistan to build this port as well as a host of associated projects such as railroad links, industrial complexes etc. India and Iran are raising eyebrows over the increased Chinese presence, which is also attracting the attention of the United States. Regionally, India and Pakistan are involved in an intense security dilemma and Iran is struggling to assert its influence as a regional power broker. Natural resources of Central Asia can only find their way to the Gwadar port through Afghanistan, which is in a state of persistent instability since many decades ago. An environment of suspicion has already started fermenting in policy making circles of all the concerned states due to increased Chinese presence in the Indian Ocean, and it could particularly blow out of proportion if it turns out to be a prelude to a military presence.

2. In the aftermath of the Global War on Terrorism (GWOT), stemming from September 11 incidents involving a majority of the terrorists from Middle Eastern countries and their heavy crackdown, American support is dwindling in the Middle Eastern countries. The United States, due to its strategic interests in the area, is maintaining a heavy military presence in the area. The requirement of a base in close proximity of the Persian Gulf may arise if the United States decided to pull out its forces from the Middle East. In this context, one would not rule out the United States’ desire to have military basing rights at the Gwadar port, as there are abundant occasions of extending such facilities by Islamabad in the past. This would, however, surely trigger uproar in Chinese circles and Pakistan’s time tested entente cordiale and strategic partnership could be put to an extreme test. Additionally, such an eventuality will put Pakistan in a very odd situation vis-à-vis Middle Eastern countries.

3. What policies should Pakistan formulate to attract the cooperation of competing nations and dispel notions of strategic mistrust amongst these nations? Success of the port project is essential for the growth of Pakistan’s economy. The GWOT, lack of thaw between India and Pakistan, and Pakistan’s delicate internal political situation are some of the facets affecting the Gwadar port, and they demand careful handling by Pakistan.


4. This article argues that “reassurance” measures are required to defuse suspicions about the perceived long-term political, military and economic objectives of all concerned states, particularly the United States and China.1 India and Pakistan are engraved in an intense “security dilemma” and to normalize relations Pakistan needs to tailor “influence” strategies and initiate positive engagement.2 Afghanistan is a landlocked country and heavily depends on Pakistan for its economic revival. Pakistan, despite estranged relations, will have to evolve “positive incentives” to keep Kabul “engaged” in order to ensure the safe passage of natural resources of Central Asian States. Relations with Iran also dictate similar strategies.3

5. Pakistan is in middle of a complex strategic and security situation; only appropriate policies can ensure the success of the port project, which is not only vital for Pakistan’s economic prosperity, but also for security. The chapter will, therefore, be structured to evaluate the strategic environment surrounding Pakistan, highlighting interests of various regional and global players concerned with the port project. In the conclusion, this thesis will draw common points evolved from the discussion of interests of these states in order to recommend policy options for Islamabad.

Strategic Situation of Pakistan

6. President Clinton, during his trip to the region in the year 2000, explained the strategic situation of South Asia by declaring it as “the most dangerous place on earth,”4 and the world witnessed two nuclear states, India and Pakistan, eyeball-to-eyeball with military machines ready to pull triggers during 2002. Historian Daniel Moran suggested that South Asia would see more than their share of irredentist and secessionist wars, arising in part from conditions that European imperialism created and left unresolved; and India and Pakistan have already fought three wars.5 Throughout South Asia, the search for prosperity is too often overshadowed by the specter of war.6 The situation on the western side, though less grave, is no different than the east. Pakistan’s desire to maintain safe borders in the west have often been met by a checkered response by Afghanistan in the name of the Durand Line controversy and Pushtoonistan issues, and by Iran due to

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Pakistan’s relations with the United States and Middle Eastern countries. Pakistan’s role in the recent Global War on Terrorism (GWOT) has made these relations more precarious.

7. Additionally, the perception of an increased Chinese presence due to the Gwadar port has added a new dimension to the complexity of the security situation for Islamabad. Not to exclude prospects of the United States, dismayed from increasingly uncomfortable presence in the Middle East, requesting basing rights from its present “front line state” (which has historically provided such facilities to the United States) at the port; inviting uproar within Chinese circles as well as putting Islamabad in very odd situation vis-à-vis Middle Eastern countries. Conversely, the Chinese decision to increase military presence to safeguard its interests in the area could trigger an unending spiral of security issues, replicating a Cold War situation.

8. In this complex geostrategic situation there is optimism for the port’s success. This article argues that it was basically the logic of economic interests that brought the international community into broad-based, deep and mutually beneficial relationships at the dawn of the new millennium. In the twenty-first century, the International institutions have the capacity to enhance the prospects for cooperation among states and even hard core realist Mearsheimer admitted that the prospects for cooperation are abundant in this promising new world.7 And major sea powers, capable of disrupting the Sea Lanes of Communication (SLOCs), have agreed that the Indian Ocean should remain peaceful.8 It is, therefore, hoped that the military de-globalization brought about by the end of the Cold War will help defuse the volatile situation surrounding a project which not only can benefit Pakistan, but the whole world.

9. Intra-regional disputes, the arms race and the absence of spirit of mutual coexistence among the littoral states have encouraged the outside powers to manipulate the littoral weaknesses and create dissention in their ranks. Big powers have always tried to maximize their influence in the littoral states by applying the tactics of diplomacy, maritime bases and naval forces to make use of vast concentration of resources. In this perspective it will be prudent to analyze the regional politico-economic interest of regional and extra regional powers. General interests of concerned countries will precede their points of contention in order to evaluate if the Gwadar port can help convert contentions into cooperation and help Pakistan evolve a strategy to foster this cooperation.

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Interests, Interrelation and Conflicts of Regional and Extra Regional Powers

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Pakistan’s Interests in the Region

a. Pakistan has a strategic location in the Indian Ocean region. On the west is Iran, which has traditionally been a close ally. On the east is India, which is seen as a potential adversary. In the north is China, which has been a close friend, and to the northwest is Afghanistan, which is likely to remain friendly towards Pakistan because of her geo – economic compulsions. On the other hand, Pakistan is also located strategically in the vicinity of the Persian Gulf and acquires a special significance as nearly 17 million barrels of oil passes through the Strait of Hormuz daily.9 About 90 % of Pakistan’s trade is sea- borne and its SLOCs are passing through the Indian Ocean.10 Development of a commercial port at Gwadar on the northern extremities is another important factor for Pakistan’s interest in the region.

b. Economic dependence of Pakistan on sea routes for trade and commerce is of cardinal importance for the country’s survival as an independent sovereign nation. The importance of the coast of Balochistan (where the Gwadar port is being made) was realized by the CIA in the 1980s citing “its strategic location near oil routes from the Persian Gulf.”11 Soviets, prior to breakup, for a long time, had desired expansion towards the warm waters of the Arabian Sea.12 Pakistan and Iran had also long believed that the USSR hoped to gain warm water ports and the same is manifested in assessments of the CIA.13 A time has come where chairman of the Gwadar Port Authority, Rear Admiral Sarfraz Khan, said, “It was a long-standing desire of these states to reach warm waters and now we have ourselves offered this opportunity to them.”14

c. In the aftermath of the Gulf War and the fall of the Taliban in Afghanistan, the political map of the region is being reshaped and new political trends are emerging. The United States, China and India are flexing their muscles to

enhance their influence in the area. The United States and Pakistan’s relationship has been like a roller-coaster ride, marked by alliance and close partnership during the Eisenhower, Nixon and Reagan Administrations and cool or tense relations when Kennedy, Johnson, Carter and Clinton occupied the White House.15 This long and checkered relationship has its roots in the Cold War and South Asian regional politics of the 1950s.16 Present dictates of the GWOT have once again brought Pakistan back in the camp of the United States.

d. China’s relations with Pakistan are the strongest in the Indian Ocean region. And from Pakistan’s side President Musharraf reiterated the historical bond by saying that “China has been our most consistent ally over the past 30 years,” adding “Washington’s interest is likely to diminish.”17 Pakistan, with antagonistic relations with India, actually sought a powerful ally to keep Indian attempts of regional hegemony at bay.

e. In the recent past, India and Pakistan have entered into a “composite dialogue” and there is a reasonable optimism that even if longstanding disputes like Kashmir and Siachen are not resolved, a working relationship could be established for the collective good of the people. Iran, India and Pakistan are working closely to strike a deal over a gas and oil pipeline from Iran to India through Pakistan. Indian and Pakistani authorities are also endeavoring to materialize Turkmenistan-Afghanistan-Pakistan (TAP), which would terminate in India and would go even beyond.

f. Optimism thus exists to foster economic cooperation amongst all concerned states and the Gwadar port can provide common ground in this regard. Interest and response of the United States’ in the port project will have far reaching affects in both its operationalization as well as the stabilization of the strategic situation in the area, which are discussed in ensuing paragraphs.

United States Interests

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11. Can the Gwadar port project harness enough United States attention to stimulate its interest in keeping the region stable? Substantially improved capacity of the United States to project power confirms her intentions to take a more active role in the affairs of this region. Although the termination of the Cold War ended a pretext of heavy U.S. naval presence in the Indian Ocean, American policy makers were still “preparing for two major theater wars (MTWs) in Northeast Asia and the Persian Gulf.”18 That is why, in May 1997, in the Quadrennial Defense Review (QDR), the Navy retained its 12 Carrier Battle Groups and 12 Amphibious Ready Groups (ARGs). U.S. academia has its own ambitions, Koburger, Jr., in his book Sea Power in the Twenty-First Century, projected that by 2021, and the U.S. Navy should have 7 super carriers plus reserves and a sealift capability of 12 Marine Expeditionary Units.19 The United States has an interest in keeping the oceans open to all, which is evident from the presence of, at the minimum, U.S. Middle East Force in the Persian Gulf since 1949.20

12. In 1992, the Pentagon drafted a new grand strategy designed to preserve unipolarity by preventing the emergence of a global rival.21 Although the strategy never saw approval at the time due to severe internal resistance, it did generate discussions across the board by academia as well as different states. The focus being, is the unipolar world stable?22 Interest in this discussion is to elucidate the United States’ role in the Indian Ocean. Charles Krauthammer argued that unipolarity is durable and peaceful, but the chief threat is the United States’ failure to do enough.23 What is the United States required to do in this area and why? It is talked about more often than not that China and the United States are destined to be adversaries as China’s power grows.24 Both states so far, however, have shown restraint and avoided situations that can destabilize the area.

13. In the Middle East, the United States’ main ally, Saudi Arabia, has 261 billion barrels of proven oil reserves (more than one-fourth of the world total) and up to 1 trillion barrels of

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ultimately recoverable oil.25 Shortly after the Arab oil embargo in 1973-74, the United States (and other Western countries) created the Strategic Petroleum Reserves (SPR) as the nation’s first line of defense in case of an oil crisis. In November 2001, President Bush made an unprecedented decision to fill the SPR to its full capacity of 700 million barrels.26 And in 2001, the United States imported 54 percent of its oil requirements, out of which 30 percent came from the Persian Gulf region.27 The United States economic prosperity and strategic security, therefore, depends on an uninterrupted supply of oil.

14. The September 11 terrorist attacks against the United States by militant Muslims, predominantly Saudis, have created a significant challenge to the long-term partnership between Washington and Riyadh.28 Trickling control over the Middle Eastern region would also mean loosening its grip over the dynamics of the region. For this reason, the United States desires a strategic alternative of Middle Eastern oil, and natural resources of CARs( Central Asian Republics) are bound to become a strategic alternate of the U.S. oil supply. Pakistan’s Gwadar port is one of the probable sites to provide an outlet to CARs natural resources, via Afghanistan. Only a few days before the September 11 attack, the U.S. Energy Information Administration documented Afghanistan’s strategic “geographical position as a potential transit route for oil and natural gas exports from Central Asia to the Arabian Sea.29 American intervention into Afghanistan in pursuit of suspected terrorists has only further complicated an already delicate regional balance. Hopes of keeping economic interests alive nevertheless remained alive even after U.S. operations in Afghanistan, as the New York Times reported on December 15, 2002 that, “The State Department is exploring the potential for post-Taliban energy projects in the region.”30 The future of Afghanistan will determine the future of United States influence over the routing of CAR resources through this area. Circumstances after the unfortunate September 11 attacks not only brought an ‘old ally’ (Pakistan) back into its camp, but also suited its alternate strategic oil supply plans. Although a reasonable portion of U.S. oil tycoons support CARs

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oil supply through Iran, the policy goals oppose the building of a pipeline that transits “energy competitor” Iran, or otherwise gives it undue influence over the region.31

15. Desire for a strategic alternate of oil aside, the indications of wearing American commitment in the Middle East does not necessarily indicate lowering of its resolve in the area as the Pentagon is becoming increasingly interested in the concept of mobile offshore bases for deployment in the Persian Gulf, to ensure the U.S. military access to critical regions in the future.32 Persian Gulf and Indian Ocean areas are, therefore, likely to remain the priority of United States policy makers for the foreseeable future. Naval presence is likely to increase even further due to increased discontentment in Middle Eastern countries and declining acceptance of U.S. ground forces. This presence will have a direct bearing on the Gwadar port project, and it ought to have positive effects.

16. In the same context, one would not rule out the United States’ desire to have military basing rights at the Gwadar port, as there are abundant occasions of extending such facilities by Islamabad. This would, however, surely trigger uproar in Chinese circles and Pakistan’s time tested entente cordiale and strategic partnership could be put to an extreme test. Additionally, such an eventuality will put Pakistan in very odd situation vis-à- vis Middle Eastern countries. Chinese probable response to such a request will be discussed in subsequent paragraphs under the heading of Chinese interest in the area.

17. Next, one would discuss Washington’s potential response if China increases its military presence in the Indian Ocean. The United States’ view of the threat and the stakes in the India Ocean, particularly the Persian Gulf, has its source in misunderstandings of the events of the 1970s; that of a severe oil supply crisis in the 1990s – and probably beyond. President Carter’s statement in his 1980 State of the Union address, subsequently labeled as the “Carter Doctrine,” that “Any attempt by any outside force to gain control of the Persian Gulf Region will be regarded as an assault on the vital interests of the United States of America and such assault will be repelled by any means necessary including military force.”33

18. As far as the United States is concerned, China has not replaced Russia as a significant global threat. China, nonetheless, is likely to be a major American foreign policy problem of the twenty-first century and the evidence suggests that China will probably be

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powerful enough to challenge America’s preferred order in Asia and may, indeed, wish to do so. A serious security situation may arise if China chooses to increase its military presence on the pretext of protecting its interests linked with the port project. Pakistan, being the country housing this port, will have to convey the port’s “utility” terms in the most explicit way to dispel port’s military usage by any of the states.

19. The Indian Ocean region has remained and will be an area of interest for the American policy makers. It is, however, a well recognized fact that the United States helps to “shape the environment” (in the words of the Pentagon’s quadrennial defense review) in various regions.34 Pakistan does need that help to ensure success of its port project. Notwithstanding internal dynamics, which are pushing policies, overall economic and strategic interests ought to drive the United States to foster cooperation amongst states of the region. The United States “assured” stabilization in the area will guarantee success of the Gwadar port project, and Islamabad needs to formulate policies that can attract such “assurance.” China, being an emerging power and largest stakeholder in the port project, has an equally important role; Chinese interests and intentions are therefore discussed in ensuing paragraphs.

Chinese Interests

20. China is an emerging global player with significant influence in the area as it is the only great power that is contiguous to South Asia. One estimate suggests that, with the present remarkable growth rate, it is expected to reach to the level of world’s largest economy of the United States by 2020.35 China’s desire to play an important role in the Indian Ocean stems from its historical association with the region and the presence of her vital sea trade routes in the area. Its long-term interests in the Indian Ocean are both economic and politico-strategic. Chinese government concerns about energy security in an oil import era, however, continue to dominate its strategic thinking.36

21. According to Mearchiemer, if China becomes an economic powerhouse it will almost certainly translate its economic might into military might. Thus, Chinese military power will appear more dangerous to its neighbors and complicating America’s commitments in the region.37 As part of China’s revised doctrine of waging “modern

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warfare under high technology conditions on the high seas,” the People’s Liberation Army Navy (PLAN) is developing a blue-water capability by 2015-20, centered on at least two aircraft carrier battle groups for the Indian and Pacific Oceans.38 The July 1992 report of the General Logistics Department of the People’s Liberation Army outlined the plans for the expansion of Chinese naval capabilities through construction of three large bases by 1998, and called for stepped-up naval visits in the Indian Ocean and more frequent port calls to foreign countries in the region.39

22. For China, South Asia, West Asia, Africa and even Europe through the Indian Ocean is closer than the U.S. West coast across the Pacific.40 At present, China is not in a position to interfere effectively in the Indian Ocean, yet owing to her growing navy and her interests she can exercise considerable influence in the region. In the present unipolar environment, China wants to take the role of a major participant in the establishment of a new type of world order. This cannot be achieved with having the Indian Ocean region out of her influence.41 Similarly, China also resents the hegemonic designs of India towards the Indian Ocean and has always exhibited her opposition to such Indian attempts. China also suspects India of supporting superpower presence in the Indian Ocean as a means of countering China. The most serious challenge is that the U.S. military presence in Central, South and South-East Asia may undermine Chinese influence in these regions and make it more difficult for China to achieve its security, economic and energy objectives in the future.42

23. The Chinese are well aware of the geostrategic realities and have been engaged in diplomatic, economic and military activities to build a maritime infrastructure to safeguard their maritime interests.43 Present Chinese commitment to build-up infrastructure is impressive as it is probably the start of long-term Chinese intent in the Indian Ocean. The same is also evident from her assistance for construction of the Gwadar Port at the northern most tip of the Indian Ocean. It would not be long before the Chinese Navy would make its presence felt in the Indian Ocean in support of its economic and maritime interests. China has already consolidated its access to the Indian Ocean through the

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Karakoram Highway and Karachi and Gwadar ports, through the China-Burma road to Burmese ports, and through the Malacca Straits. For China, the second stake holder in the Gwadar port project, the port offers a strategic toehold in the energy rich region of CARs and provides an alternative trade link to its western provinces. Xinjiang Province lies 4,500 kilometers from China’s east coast but just 2,500 kilometers from Gwadar. This will make it possible for China to route some of its external trade through the Gwadar port.

24. China’s growing military strength vis-à-vis her central geographic location and her desire to become a pre-eminent power in the region suggest that China has to play an important role in the future conflicts of the region. The regional balance and stability in South Asia and Pakistan’s healthy development are two major interests for China in addition to safeguarding her own interests. Chinese desire for an increased role in the area could seriously jeopardize if Islamabad chooses to consider any United State request for Maritime bases, particularly at Gwadar.

25. International relations theorists suggest that as a nation becomes more prosperous and more integrated into the world economy, it will become more democratized and more anxious to preserve the world order that has made its prosperity possible. It is therefore envisaged that the Chinese would not venture into military presence on the name of safe guarding interests at the Gwadar Port and stir up a never-ending spiral of seriously destabilizing events. Pakistan will have to ensure appropriate policies to dispel any such contemplation by Beijing.

26. Having discussed interests of both the United States and China, capable of stirring complexity of the strategic situation, this article will now turn to Iran, a probable economic competitor with regards to Gwadar Port, which has long been waiting opportunities to establish its dominant role in the region.

Iranian Interests

27. The Persian Gulf is an important trade route in the strategic northern reaches of the Indian Ocean. Some 80 % of the world’s oil tankers leave the shores of the Persian Gulf destined to other parts of the world.44 Geopolitical location of Iran within the Persian Gulf region is such that the northern shores of this Gulf belong entirely to Iran, which enables her to control the Strait of Hormuz. Passage through Hormuz is an issue of concern several times a year when Iran holds its war games at the mouth of Gulf.45 Iran regards her

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role in the Indian Ocean as an extension of her interests in the Gulf due to important geographical location at the mouth of Persian Gulf.

28. Iran, too, is concerned with her economic interests associated with the Indian Ocean. Supply of natural gas to India, via a pipeline through the Indian Ocean, is one of Iran’s mega projects. Additionally, the Iranian port of Chahbahar, located on the mouth of Gulf, could become the hub of commercial activities if the natural resources of CAR find the way to rest of the world through this port. Iran’s situation with respect to its influence on the CARs and its desire to mend fences with the West suffers many impediments.

29. Turkmenistan sees Iran as one of the export routes for both oil and gas; even many of the oil tycoons see it as a viable option but the United States is pushing hard for alternative routes.46 Washington advocates the construction of pipelines in several directions from the Caspian Region, explicitly excluding Iran.47 Although Iran has seen some investment from the EU (particularly France) and India, it largely remains isolated from the international monetary system. Its isolation thus enhances prospects of Gwadar port success.

30. Historically, Iran had warm relations with Pakistan more often than not. Both countries being candidates of a transit route for CAR natural resources, as well as trade, may well eventually end up on an adversarial path. Additionally, increased Indian influence in Iran is considered an attempt of “encircling” Pakistan. In this situation, Pakistan needs to initiate “positive engagement” with Iran to safeguard its interests in the area.

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31. Discussion of an economic competitor now leads to evaluating interests and intentions of India, another emerging power with growing economic interests and with whom Pakistan’s relations have mostly remained of animosity: India.

Indian Interests

32. India is perhaps the only country on the Indian Ocean that has the economic potential, military strength and the political will to dominate this vast expanse of water.48 Indian leaders and strategists have traditionally viewed the Indian Ocean region as a sort of Indian security zone, very loosely akin to the way Americans have viewed Central America and the Caribbean; or the way Russians have viewed Poland; or the way Chinese have viewed Korea. Although Indian leaders have not explicitly laid out such a regional doctrine, Indian behavior in the Indian Ocean has generally conformed to such an implicit doctrine.49

33. India’s dominant physical features and geographical location in the Indian Ocean indicate its dependence on the sea for both prosperity and security. India does not have any significant land access to the rest of world. Hostility with Pakistan and a difficult geography that separates India from China and Burma dictates that over 97 % of India’s trade is done through the Indian Ocean; therefore, India has critical interests in maintaining the seas, be open. India depends, to a large extent, on the import of crude oil and petroleum products for meeting its energy requirements from the Persian Gulf region. India’s production from existing oil fields has been declining over the time, increasing its dependence on the import of oil.50 And imported oil meets about 60 % of the Indian petroleum requirements.51 India’s Ministry of Petroleum and Natural Gas predicts the country’s demand for petroleum products will jump to 155.3 million metric tons/year (3.106 million barrels per day) by fiscal year 2006-07.52 To meet additional energy requirements, India seeks to develop economic relation with CARs in collaboration with Iran and desires to have access in this market. For this reason, since the 1990s, Central Asia has come to represent India’s extended neighborhood. For India, Caspian energy supplies have a

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critical strategic drawback in that they must transit Pakistan, with whom relations are continually strained over the disputed territory of Kashmir.53

34. Indian strategic doctrine revolves around the protection of its maritime resources/assets, such as offshore oil platforms/rigs and sea-lanes of communication, to ensure smooth flow of trade.54 There are up to 30 Indian ships at sea in Indian waters at any given time and a much larger number of ships of other nations engaged in trade to and from Indian ports,55 in addition to 8-10 tankers carrying crude oil to India daily.56 India is working on the strategy of building up a viable maritime force to deter any potential aggressor and to protect her SLOCs. Joseph S. Nye, Jr., in his book “The Paradox of American Power”, writes that India’s military capabilities are impressive in South Asia but not in the larger Asian context.57 However, its strategic interests extend way beyond that and tend to enter the domain of regional hegemony, which dictates her relations with other countries.

35. India’s relations with other countries have so far been driven by security dictates more than economic compulsions. Its historically estranged relations with Pakistan do not require much discussion, as both countries already have fought three wars and more than half a dozen incidents short of war. The regional power balance vis-à-vis Pakistan has largely determined India’s relations with Afghanistan since 1979. Broadly, India has two principle foreign policy objectives when dealing with Afghanistan: to counter Pakistani expansion into West Asia, and use Afghanistan as an access route to Central Asia.58

36. In the late 1990s, the United States began to tilt toward India, as Washington and New Delhi turned from ‘estranged democracies’ of the Cold War to ‘engaged democracies’ in the post-Cold War era.59 U.S. officials consider strategically engaging India as a “future investment,” particularly since the Middle East could become hostile and dangerous to continuing U.S. military presence in the region. If Washington’s relationships with its

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traditional allies – Japan, South Korea and Saudi Arabia – become more fragile, India will emerge as a critical component of U.S. strategy. 37. When its relations with China come up, the Indian security community feels that extension of Chinese interests to the South Asian portion of the Indian Ocean is potentially harmful for India.60 India even attributed 1998 nuclear explosions towards its security concern from China. Defense economists, however, estimate that if India continues to spend 4 % of GNP on defense, in fifteen years its military capital stock would reach $314 billion, or 62 % of China’s (compared with 48 percent today).61 These figures indicate maintenance of parity amongst both countries, leaving Pakistan and other Indian neighbors to deal with Indian military might, if they choose to “catch up” to China. There are, however, reasons to be optimistic since Indian policy seems to be shifting from pure security orientation to economic concerns. Even this shift has the potential to prove a significant factor for resolving outstanding issues with neighboring countries. Pakistan needs to seize this opportunity to normalize its relations with India and reasonable progress is already underway in shape of “composite dialogue.”

38. India’s increasing interest in Afghanistan, however, is raising concerns in Islamabad. When Gwadar port is put in operation, Afghanistan will be one of the direct beneficiaries by accessing it for its trade as well as getting royalties when the gas/oil pipeline is materialized. Afghanistan’s strategic situation and its interests in the area in general and the Gwadar port in particular are discussed below.

Afghanistan’s Interest

39. Afghanistan has historically remained the center of contention between major powers. History knows one such struggle for mastery in Central Asia by Russia and Great Britain resulting in “the Great Game.”62 Russia again ventured into Afghanistan towards last decades of 20th century, attracting U.S. attention that was looking for suitable opportunity to undo some of the unpleasant memories of Vietnam. This Russian venture ended when, at Politburo meeting on November 13, 1986, the Soviet leaders decided to withdraw troops from Afghanistan by the end of 1988,63 resulting in the culmination of the Cold War. Hopes of building war torn Afghanistan faded sooner than expected due to internal strife of warlords. The Taliban then came along to fill the leadership gap; they also could not survive long due to United States outrage over the handover of “so called”

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terrorists after incident of September 11, 2001. Afghanistan is currently in a state of war and nation building, and it is too soon to foresee how things will settle in the long run.64 40. Afghanistan lacks a functional economy of any significance. Its agrarian based subsistence economy is not even meeting the basic food requirements of Afghans, forcing the population to survive on foreign donated food. The World Bank has estimated that requirement of a fund for addressing basic Afghan problems to be around U.S. $10.2 billion over five years. Based on two years of reconstruction experience, in July 2003, Care International estimated the requirement of funds to be between U.S. $15-30 billion over a five-year period.65 So far only a fraction of funds have actually been made available, but whenever reconstruction activities get momentum, Pakistan, by virtue of its geographical position, will have to play an important role and the Gwadar port stands bright chances of an active role in the entire reconstruction exercise.

41. Amongst other projects, the Turkmenistan-Afghanistan-Pakistan (TAP) pipeline was a hope to help revive the Afghan economy. The TAP pipeline project would have proven to be a jackpot for the people of Afghanistan as the project could bring in over $300 million as royalty to the country.66 The inflow of this cash and foreign investments could help in stabilizing the country’s economy and in reconstructing its infrastructure. It can be argued that a pro-U.S. regime in Afghanistan will be conducive to the involvement of a U.S. firm in the Turkmenistan-Afghanistan-Pakistan pipeline.67 Afghan transit trade was earlier handled through the Karachi port, and after operationalization the Gwadar port will handle it. Afghan Finance Minister Ashraf Ghani also offered his country’s support for development of the Gwadar port, saying it would act as a gateway to prosperity for the entire region.68 Pakistan needs to keep Afghanistan engaged to facilitate the smooth and economical running of the port.

42. Discussion of the interests of various states in the Gwadar port with tremendous economic prospects would not be complete if interests of Japan and the European Union are not evaluated. Although both entities do not have any significant political or security interests in the area, their economic interests demand appropriate mention.

Japanese Interests

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43. The importance of the Indian Ocean to the Japanese cannot be exaggerated; it would not be wrong to state that the Indian Ocean is a lifeline of Japan. Japan averaged 3.9 million bbl/d of net oil imports from the Persian Gulf during 2002.69 The need to protect her economic interest may one day invoke deeper involvement of her “Self Defense Maritime Forces.”70 Japan presently relies on the forces of the United States and other Western powers for her protection. Japan has no worthwhile political goal in this region and, with over dependence on this region for raw material and oil, the Japanese have always desired peace here. Japan’s energy concerns dictate its policies in favor of oil from a Caspian export pipeline terminating at the Indian Ocean.71 Therefore, it is safe to assume that Japan will support the operationalization of the Gwadar port project.

44. In addition to the United States, Japan will be the most worried nation with increased presence of the Chinese at the helm of the routes to her vital energy resources. Recent economic collaboration, though, has helped both nations to leave their bitter past experience behind. Divergence in interest in the Indian Ocean may strain their relationship. Pakistan will have to “reassure” Japan to alleviate any suspicions of port utility harmful to Japanese interests.

European Union Interests

45. Western Europe averaged 2.3 million bbl/d of oil imports from the Persian Gulf during 2002.72 EU members possess only about 0.6 % of the world’s proven reserves of oil and 2% of the world’s natural gas, and it is estimated that two thirds of the EU’s total energy requirements will be imported by 2020.73 The EU is, therefore, heavily dependent on oil transiting through the Indian Ocean. By and large their policy towards the Indian Ocean region has been one of reconciliation and resolution of security issues through the use of “soft power.”74 Their dependence on oil, so called guarded by the U.S., has not encouraged them to seek an active role in problems of either the Middle East or South Asia.

46. Nevertheless, a strong realization exists amongst European nations to have strategic alternate oil resources reducing their vulnerability to a single area source. Like all others, CARs attracted the EU’s attention for which the EU strongly supports an oil and

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gas pipeline from CARs to the EU through Turkey. The pipeline route to European markets through Georgia and Turkey faces geopolitical turmoil and tough hurdles in its realization and actual execution. Separatist tensions in Georgia, instability in the Kurdish areas of Turkey, and unrest over Cyprus near the Mediterranean Turkish port of Ceyhan are some of the problems.75 In this scenario, the EU is likely to support a pipeline to the Indian Ocean either through Iran or Pakistan. There is negligible evidence of drags in EU relations with states that matter to the Gwadar port project. The EU and China have developed a stable relationship over the last decade, and so far they do not seem worried about Chinese presence in Indian Ocean.

Conclusion

47. The above discussion clearly manifests that strategic interests of all nations necessarily stem from the economic interests. Gwadar, with potential to act as a hub port, can facilitate convergence of interests of all states, bringing peace and prosperity in the area. Today, the entire globe is focused on the Middle East and Asia with the primary concern of protecting economic interests in the form of a free flow of oil from the Persian Gulf region, as well as tapping the natural resources of the Central Asian Republics. Friedman puts forward “the Golden Arches Theory of Conflict Prevention”, arguing that economic globalization had made interstate war nearly impossible.168 Others admit that in today’s world chances of cooperation through economic integration are more than ever in the history of mankind. But the political, economic and military importance of the Indian Ocean has turned it into a major theatre of rivalries. The power politics of littoral states is, of course, as threatening to peace as coveting influence and protecting interests through power projection capabilities by the external powers.

48. The United States, as a unipolar power, ought to play an important role in keeping the situation stable in the Indian Ocean. One hopes that Krauthammer’s fears on United States failure to do enough resulting in instability of the area do not materialize.76 Though it might also be possible for the United States to do too much and provoke balancing against it, which would also result in instability. Its role in promoting liberalism is also appreciable so far as it is not stigmatized as imperialist. China and the United States may not necessarily be adversaries, but rather once again use Gwadar as a platform to promote economic well being of the area; after all, similar understanding in relations of both nations with respect to Pakistan had worked earlier as well. 77It cannot be overlooked that China

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has never lost an opportunity to cultivate U.S. goodwill.78 India’s ambitions of economic prosperity with over a billion people is justifiable, but not for a role as a regional hegemony. 49. South Asia has had enough of its share of turbulence without realizing that respective economies may receive a crippling blow by a serious armed conflict and set the clock back years or even decades.79 Delhi needs to appreciate that United States and Chinese interests in their mutual relationship far outweigh the interests of each vis-à-vis India, and both have high economic stakes in the Indian Ocean.80 The lesson for all nations contiguous to Pakistan (with respect to the Gwadar port) is that unbalanced power, whoever wields it, is a potential danger to others.81 Whereas, the emerging geopolitical environment in the region has led Pakistan to stand again as a strategic front line state for the interests of Extra Regional Powers, safeguarding of its economic interests clearly manifests from present government policies. Pakistan needs to adopt a balanced approach to ensuring stability, security and cooperation rather than conflict and confrontation with its neighbors, as well as the international community.

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Editor’s Note:
References are missing in this article from ECEME, Escola de Comando e Estado-Maior do Exército Escola Marechal Castello Branco Journal, Brazil

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