International Journal of Scientific and Research Publications, Volume 10, Issue 3, March 2020 212

ISSN 2250-3153

International Relations and Business Diplomacy

A Case Study Model of China-Pakistan Economic
Corridor: Interdependencies
Noman Qadeer

School of management Sciences & MBA, North China University of Water Resource and Electric Power, Zhengzhou, 450002, Henan, China

DOI: 10.29322/IJSRP.10.03.2020.p9922
http://dx.doi.org/10.29322/IJSRP.10.03.2020.p9922

Abstract- Purpose – Purpose of study is to analyze the diplomatic forum. Their bilateral relationship is ever increasing with mutual
relationship between People’s Republic of China and Islamic understanding and frequent high-level visits of government
Republic of Pakistan through China-Pak Economic corridor of officials. Their defense ties are the strongest bond of the
interdependencies. This paper highlight the interdependent model relationship. But now with the fast-moving economy, reaching out
between both the countries and objectives achieved through it. for more dynamic and active role in global politics and demand
Design/methodology/approach – The paper uses data for energy, China has diversified its relationship with Pakistan.
collected secondary source of investigative case studies over the They are moving towards increasing bilateral trade, investment,
time series of 2012 to 2018. Some interviews collected by the infrastructure development, energy projects and people-to-people
CPEC & OBOR project team in Pakistan. Main it depends upon contact.
the scholarly literature and studies previously held on the subject. In Year 2013, the China-Pakistan Economic Corridor
Findings – interdependencies model of objectives of both the agreement was signed along with the formal handing over of
countries with respect to China-Pakistan Economic Corridor and Gwadar Port for further development and operation to China.
analysis of business and diplomatic relationship of China and Various projects will be completed under the CPEC, with the
Pakistan in Geo-Economic Scenario. worth of 46 billion dollars and more. This diplomatic relationship
Originality/value – The use of limited number of case study of interdependencies and economic benefits has become the key
and less statistical data for the paper makes it less complicated but factors of interest for whole of the world as this is the game
still firsthand data collection through the real project team through changer for the entire region. This paradigm of partnership will
interviews makes it more clear and real for the readers’ and result in changing the economic superpower and leaders of the
scholars who intend to investigate further. Case Study and world. My paper tends to investigate the dark side
literature is carefully selected for just cause. interdependencies of both the countries and objectives achieved
on the ground level realties. Four project investments in CPEC
Index Terms- (Interdependencies, Business Relation, Diplomatic may help build Pakistani Infra-Structure and overcome energy
Relation, Geo-Economic) crises in Pakistan but nothing comes for free. What is the
JEL classification: F02, F15, F53, F59, O19 opportunity cost Pakistan is paying to achieve higher goals and
what is lay off policies Pakistan is been following to see this
project completion. The CPEC is a holistic, comprehensive
I. INTRODUCTION package of competitive economic initiatives from China, just the
energy projects once initiated will kick-start an industrial boom in
E conomic regionalism in South Asia has entailed the search for
collective efforts to engulf frail economies, political downfall,
social and religious cleavages and the resultant inherent discords
Pakistan. Thar Coal is one of the Largest Coal asset, was lying
untouched in the desert of Pakistan. This Virgin Coal Industry of
among various states. The Economic Corridor (EC) is employed Pakistan can support energy requirements of the all the region for
as a means to enhance regional cooperation, invigorating very long time.
economic development and deeper integration of Asia’s sub- Because of this Diplomatic relationship and Economic
regions. In South Asia, it is a hottest phenomenon that the adventures of Pakistan and China Ties around the world have been
development of economic corridors has gained impetus. The changing U.S entering in Indian market making bonds with India
recent example is the China-Pakistan Economic Corridor (CPEC) compete in the market against China and Pakistan. Accessing
(Wolf, May 11 2016). market has become easier but yet very difficult subject to
Interdependencies bring two countries on mutual grounds of international and political relationships of countries all over the
business trade and investment. China and Pakistan are two world. Iran, India and U.S are playing their part to establish their
countries interdependent on trade, defense and power games of the own corridor for joint investment. This leaves Pakistan and China
world. Both the countries are enjoying this bonded relationship to rest aside their major interest and create edge over competitors.
since long. Both have been supportive to each other almost each The CPEC project is the result of the long cordial bilateral
relations based on state-to-state mutually beneficial terms. If to see

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it from geo-political and geo-economic angle, one can say that it 2015).The Chinese President, explained China’s “Good Neighbor
is an extension of the China‘s growing economic network. CPEC Policy as part of a strategy of peaceful development which China
project is a tiny addition to the China‘s rise economically and it‘s sought to promote as an interdependent, rather than competitive,
growing needs for regional connectivity. Under China‘s policy of relationship with her neighboring countries and the world” (Iqbal,
the renewing Old Silk Road, the One Belt One Road initiated in 2015). In 1966, armed assistance between China and Pakistan
2013, it is investing even bigger portion of it in Central Asia. This began, in 1972, strategic partnership was developed and in 1979,
project will boost the economic relations of the two countries economic collaboration commenced. The relationship is said to be
through opening up multiple channels of cooperation in the long ‘higher than the mountains’ and ‘deeper than the oceans’.
run. China is investing in Pakistan and the route will connect Following are a few key events in Pakistan and China relationship.
China‘s western parts to Gawadar port and in the long run this In September 1950, Pakistan voted in favour of a resolution
route will connect Central Asia and the region altogether. CPEC challenging the right of the Nationalist Chinese representation in
has brought together China and Pakistan for a win-win situation the United Nations, and asked for the seating of the true
by playing the politics of interdependence‘. representative of the Beijing government. Pakistan also supported
the ‘One China Policy’ and in 1951, trade relations between the
two were firmly established. In 1954 and 1955, Pakistan joined
II. 2.0 BACKGROUND SEATO and CENTO respectively due to her search of security
“freshly world has seen a paradigm shift from tactical against India (Syed, 2013). These pacts were initiated as a cordon
grouping to the establishment of economic cooperation stuck solitaire to contain the Soviet Union and China. Meanwhile from
between countries around the world, the diplomatic interest and mid-fifties to early sixties, Sino-Pak ties were somewhat dented.
security of the state being the determinants of this collaboration. The decade of the sixties eventually saw a consolidation of the
States redefine their interests and reshape their policies owing to Sino- Pak friendship. In 1961, Pakistan viewed her role as an ally
the realization that it does not seem potential for them to preserve of the West, and renewed her links with China as well. Pakistan
their welfares with their existing capacities” (Ashraf, 2015). Apex again voted for China’s seating in the United Nations.
height talks and diplomatic consultations are traits of a robust Long relational cordials with China lead to another
partnership between nations in a variety of fields, such as economical venture and new ties of international relations. China-
industrial ventures, development programs, defense, infrastructure Pak Economic Corridor strengthened the bond between two
and other areas of cooperation (Noor, 2008). For decades, China countries and acceptance of these ties is welcomed by both the
was deemed as a ‘sleeping giant’ that has awakened and now nation. CPEC lead both countries to interdependent economic and
playing a key role not merely in South Asia but in the entire world. political benefits. Today CPEC is sought to be the largest change
President Xi Jinping’s predecessor Xiaoping followed a in world’s economic scenario initiated from China and rooted in
conservative foreign policy based on “hide your strength, bide Pakistan. This study further discusses the importance of OBOR
your time, never take the lead”, however the current premier, and CPEC for the economic leadership of both the countries and
President Xi, calls for a more vigorous, activist and assertive regional dominance of both the countries as it connects China and
foreign policy, and dreams of a “strong and powerful” Chinese Pakistan to rest of the world for easy trade.
state. The Peoples Republic of China (PRC) and Pakistan’s
relations date back to 1950 very soon after the creation of the PRC.
The long history of camaraderie between the two is underlined by III. 3.0 LITERATURE REVIEW
mutual trust and assurance. Mao Zedong, the Chairman of the 3.1 Literature on Pak-China Interdependencies
Chinese Communist Party announced that the PRC was ready to (JAVAID, 2016) (Akhtar*, 2017) (Chawla, 2017) (Hameed, 2016)
establish diplomatic ties “with any foreign government willing to All the authors of subcontinent have tried to put the face that
observe the principle of equality, mutual benefit and mutual CPEC is important for both the countries’ Economic and Political
respect for sovereignty and territorial integrity” (Mahdi, 1986). ties. One Belt One Road initiatives (OBOR) is a project which
Pakistan, in 1950, responded to his call by recognizing the PRC. showcases China’s global outreach in Asia, Africa and Europe.
In 1954, Chinese Premier Chou En-Lai made a statement that The China-Pakistan Economic Corridor (CPEC) project is an
summed up one consistent aspect of the Chinese foreign policy by important component of this project. Higher than the Himalayas
stating that “all people should have the right to choose their own and deeper than the Indian Ocean‟ and „sweeter than honey‟ are
state system and way of life without interference from other some of the clichés often associated with the Pakistan-China
nation’s revolution cannot be exported” (Mahdi, 1986). In spite of diplomatic relations. Six and a half decades of peaceful co-
believing in an absolutely opposing ideology, Pakistan accepted existence with zero number of clashes at states‟ level presents a
the Chinese notion at first, thus, rendering it possible for two states unique example of bilateral ties, globally. [Pakistan-China
with different socio-political systems to establish durable ties. diplomatic relations span over six decades of persistent cordiality,
Secondly, Pakistan was convinced that the PRC harbored no represent a unique example in the current international political
designs of territorial aggrandizement against her neighbors. system. Until the turn of the century, this relationship was limited
Thirdly, Pakistan concurred with the Chinese that there was no mostly to government-to-government, defense, political and
actual ‘conflict of interests’ between the two. diplomatic cooperation. However, since the start of this century,
Therefore, Sino-Pak relations were founded on a very cordial the relationship has expanded in economic and socio-economic
footing. Maintaining a wholesome connection with China has spheres. The realization that the two countries need each other
been a vital feature of Pakistan’s foreign policy. Pakistan helped more in the changed regional and global setting is visible on both
China in sustaining the balance of power in the region (Iqbal, sides. Nevertheless, understanding of each other’s society and

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culture is still a less-explored domain. An intimate relationship opposition to one other as is frequently claimed. To the contrary,
between Pakistan and China is not a novel phenomenon. For anarchy and interdependence are different features of the
decades, they have been ‘all-weather’ friends –both countries international system. (Baldwin, 1980), and others have repeated
enjoy enduring and deep-rooted ties. Initially, China and Pakistan that the concept is not new. Interdependence thinking and
were involved in a geo-strategic context, but since the end of the theorizing have been at play for a long time and have served as
Cold War, their relations have increasingly become fundamental building blocks in international relations. (Baldwin,
multidimensional. China emerged as an economic regional power, 1980) Author illustrated this point by recounting Angell’s
and over the years has been successful in generating her own frequently cited story about two men in a boat in a stormy sea. The
sphere of influence by developing a huge export capacity along boat was leaking and rapidly taking on water. One man rowed
with a robust market. Pakistan had her own way with a long history frantically as the other desperately bailed. If either stopped, the
of rivalry with India and then fighting the war against terror that boat would sink and both would drown. They were equally
dragged her into destitute economic conditions. India’s increasing dependent on one another. Baldwin suggested that the story
interest and influence in the region and her growing cooperation reveals several elements commonly addressed by most pre-WWII
with the US alarmed both Pakistan and China. Reciprocating, interdependency writers: a division of labor among parties
Pakistan and China agreed to build a “One Belt One Road” project; involved; mutual dependency among the parties; mutual benefits
also known as the China Pakistan Economic Corridor. from exchange; reciprocal interdependence constrains behavior;
dependency as unpleasant fact; and the effects of interdependence
3.2 Literature on CPEC on the effectiveness of the use of force.
(Leight, 2011) (Rohimi Shapiee, 2017) Authors tried to explain Clearly, these examples show that interdependence is
that CPEC is an obvious way for Pakistan to overcome the relational and refers to the situation of parties engaged in a system
economic crises and other related issues but it will not be possible of action. CPEC is bridge between China-Pak Interdependencies.
under the current problem of Pakistan legal system and not Both countries are connected through OBOR on mutual interest
suitable infrastructure for the project. For this cause a detailed ground of Economics and Trade. This also led to security and
changing environment is required otherwise dream may not come military ties between both the countries to safe guard their
true. (Naranjan, 2015) In 2013, China and Pakistan announced investment from external threats. The catalyzing piece of this
plans to construct an economic corridor to connect Kashgar in scholarship was the publication in 1977 of Power and
China’s Xinjiang Uygur Autonomous Region with the Interdependence (Nye, 1977). These authors suggest that
southwestern Pakistani port of Gwadar. Together with the “interdependence” is both an analytical tool and rhetorical device.
proposed BCIM Economic Corridor (BCIM-EC), the China- “In common parlance, dependence means a state of being
Pakistan Economic Corridor (CPEC) extends to South Asia the determined or significantly affected by external
broader trend of Asian regional economic integration through forces. Interdependence most simply defined
economic corridors. This became an alarming problem for India means mutual dependence. Interdependence in world politics
as China-Pak diplomatic relations were already hurting the causes refers to situations characterized by reciprocal effects among
of India now this mutual bond based on economic belt leaving countries or among actors in different countries” (Nye, 1977).
Indian dream of winning the race far behind of his reach. They differentiate interdependence from simple
(Rasheed, 2017) Author tends to further explain that CPEC lead interconnectedness by the existence of costly reciprocal effects.
ties of not only Pak-China but other countries are also competing They argue that is distinction is crucial for understanding the
in the game. U.S and India since the inception of CPEC have politics of interdependence. Keohane and Nye distinguish between
joined hand in many trade contracts and economic ventures in two dimensions of interdependence for understanding power and
order to cover up the market and leave less for China but CPEC interdependence: sensitivity and vulnerability. According to the
has already changed the game for both the countries. (Mirza, 2016) authors, “sensitivity means liability to costly effects imposed from
Says the author China has successfully adopted foreign policy of outside before policies are altered to try to change the situation.
non-confrontation and has laid undiluted emphasis in pursuit of Vulnerability can be defined as an actor’s liability to suffer costs
her political and economic interests. Resultantly, China has imposed by external events even after policies have been altered (
emerged as second largest economy of the world. One of the most (Nye, 1977). Clearly, ambiguity exists over the concept and its
fascinating manifestations of China’s rise is the One Belt One usage. What is equally clear, however, is that the concept is central
Road (OBOR) initiative, running overland along the Silk Route for explaining the nature and dynamics of international
Economic Belt (SREB) and through the seas along Maritime Silk organization, as well as international relations more broadly
Road (MSR). conceived. Broadly speaking, this concept has been used in
international relations theorizing to provide the context necessary
for understanding its use and potential for understanding the
IV. 4.0 THEORETICAL FRAMEWORK dynamics of international organization and global governance.
4.1 Conceptualization of interdependencies Specifically, the analysis examines the use of the concept in the
Interdependencies of countries are due to economic bonds study of general international systems, world-systems theory,
and trade contract to safe guard their investment and achieve set dependency, international integration, and transnational relations.
goal together many countries under go interdependent on each
other. (Moravcsik, 2009) Has argued, interdependence is a key 4.2 Interdependence in international Relations theory
structural feature of the international system, along with anarchy. As reflected by (Baldwin, 1980), interdependence thinking
She argues that anarchy and interdependence do not stand in has a long history in contemporary international relations

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scholarship. Marx’s critique of the capitalism, for example, was ally to china. On the note Pakistan has handed over Gwadar port
based on fundamental interdependence concepts and systems to china as the mutual contract signed for the benefits of both the
logic. Marx’s theoretical foundation would soon be built upon by countries. China-Pak friendship has led to many interdependencies
Lenin and others who saw mode of production, technological to each other on different frontiers.
change, exploitative economic relations, and the dynamics of
interdependent social relations among collectivities. 1. First is to reduce the distance for supply of goods and trade.
In many respects, (Carr, 1939) initiated the interwar-time Currently China is dealing with most of the world through the
context. To develop a comprehensive image of international Pacific as well as Indian Ocean. China is dependent on the
relations, he focused on interdependence related to relative power Strait of Malacca for supply of oil and other energy and trade
relationships among major powers in the Westphalia interstate commodities and; also to deliver its own products in Middle
order. He distinguished power into three distinct elements: Eastern, African, European markets; and beyond. From the
military, economic, and power over opinion. The struggle to fulfill coasts of Middle East to the Port of Shanghai, total distance
power-related objectives creates an interactive framework in is about 12000 km and further to include the north-western
which states cause conflict while attempting to achieve additional Sinkiang region of China, it makes about 16000 km.
power. In this context, the struggle for power among states may Logistically this is so long distance to be covered and even
cause change at the systemic level, which can serve as a stressor costly. By the construction of road, railways and pipeline
for conflict among them. Carr did not believe in absolutist networks across Pakistan to connect Kashgar with Gwadar, it
assumptions. Historical conditions and relative positions, actual is only 2500 km. The successful completion of CPEC will not
and perceived, among state actors conditioned such systemic only save time for China but also make its supply more secure
change. and quick. United States is also a factor in the current Chinese
Writing several decades later, (Bull, 1977) suggested that maritime route where the former possess a huge influence in
endeavoring to coping with interdependence can also be an the Pacific Ocean by supporting its allies and monitoring the
underlying cause of cooperation. (Bull, 1977) He argued that, region.
while the international system is anarchical, it is subject to 2. Chinese second objective is to develop its neglected and
principles of interdependence. The members of the system form a backward Sinkiang and other north-western regions. The
society with common rules and institutions, providing order in the Chinese motive here is also to create job opportunities and
international arena. These rules and institutions are based on basic curb the separatist and terrorist tendencies. Bordering with
goals of the society of states, including (a) preservation of the Afghanistan and Pakistan, Sinkiang has been under the threat
system and society of states; (b) maintaining the sovereignty of of separatist organization the ‗East Turkistan Islamic
states; (c) preserving peace; and (d) general goals of social life. Movement‘, responsible for unrest in the region. Beijing
regime believes in the eradication of terrorism from region
through the economic emancipation for bringing it into the
V. 5.0 METHODOLOGY AND DESIGN mainstream politics.
5.1 Qualitative design 3. Third objective is the security and expansion of energy and
This research is based on qualitative design. As major part trade linkages. Pakistan provides a shortest route to China‘s
of the study is covered by literature available in different studies linkage with Middle Eastern and African markets. Due to the
though this topic is not old and very fewer studies are available rapid industrialization and becoming the world‘s second
but attempt is made to make things clear. CPEC is initiated in year largest and fastest growing economy; since 2003, China is the
2013 since then fewer authors have worked on the topic. second largest consumer of oil and other energy resources.
Especially the topic of interdependencies between China and This global hunt for energy has forced China to look for more
Pakistan through OBOR and CPEC has not been studied before by supply of energy resources from Middle East and to use new
many authors. markets of Africa, where it is the world‘s biggest investor.
Secondly for this research purpose the main study of 4. Fourth is Chinese investment in Pakistan‘s mining and energy
economic interdependencies is designed through the studies of sectors where various projects of coal, copper and other
famous author (Nye, 1977). Author of Power and minerals are underway with Chinese assistance in Pakistan.
interdependencies book has tried to overcome the topic that two 5. Fifth is the development of infrastructure and Gwadar Port.
countries become interdependent through mutual investment on a Regional stability as well as Pakistan‘s internal security is a
project and power distribution over the project leads to mutual pre-requisite for all other objectives. China‘s most parochial
interests and diplomatic interdependencies. For the purpose of this motivation for the CPEC is to provide economic support to a
study we have also taken few interviews of the employees working flagging ally struggling with internal instability. A stable and
in CPEC projects for understanding the motivation and needs of economically prosperous Pakistan is in the interest of China
both the countries and objectives achieved from it. to carry on its trade and economic projects with the world.
6. Last objective is to have access to Indian Ocean for
monitoring the strategic developments in the region and to
VI. 6.0 NTERPRETATIONS OF CASE STUDIES expand its presence in the Middle East. It will also help China
for more connectivity with the energy-rich and land locked
6.1 Driving Force for China to Invest In CPEC Afghanistan and Central Asian republics. One of China‘s
China recently has changed his policy from inward to major domestic security concerns is to ensure that Islamists
outward directions and for the cause Pakistan has become the key do not penetrate the western autonomous region of Xinjiang.

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Bordering on Afghanistan, this area has experienced unrest in links, railway tracks, pipelines, industrial parks and economic
the past decade or more as a result of political influence from zones will be established under the CPEC.
the region probably inspired by the increasing insurgencies in 3. Third objective Pakistan wants to achieve through CPEC is
a number of Muslim countries. China, it is believed, has the development of the deep water seaport at Gwadar. It is
expressed its concern to Pakistan on several occasions, with situated at a significantly geostrategic location, near the Strait
Beijing‘s reaction varying from diplomatic protest to extreme of Hormuz on the Persian Gulf through which about 40
annoyance expressed in the form of temporary closures of the percent of the world oil channelizes on daily basis. The port
border with Pakistan. has already been developed with the Chinese assistance and
handed over to her for future operations. The long-remained
6.2 Driving Force for Pakistan to Partner China backward and militancy-ridden area of Baluchistan will be
1. Pakistan is equally interested to complete the China-Pakistan come into mainstream by all the economic initiatives and
Economic Corridor. Various factors are responsible for employment opportunities. Gwadar Port is in competition
Islamabad‘s efforts to make it a success story. First is the with the Iran‘s Chabahar Port, Oman Port and Dubai Port.
overcoming of the power shortfall where the country is 4. Fourth factor is the regional connectivity. The CPEC project
lagging behind to facilitate its public and run industries. The is passing through an area which joins together some
country‘s short fall has been increased especially since 2007 geopolitically and geo-strategically important regions of
resulted into the public continuous outrage and less South Asia, Middle East, and Central Asia; and further to
productivity of the industrial sector. Various energy projects Africa and Europe. Gwadar provides an easy access to Indian
of hydropower generation, thermal plants, coal-run Ocean for Afghanistan and Central Asian republics, to import
installations, wind and nuclear energy are included within the and export trade. Some Central Asian states and Afghanistan
umbrella of CPEC. It is not only useful for creation of more are also part of the China‘s One Belt, One Road policy.
job opportunities but equally significant to produce more Pakistan‘s trade and energy relations with these countries will
commodities and improve the quality by industries. be increased with a rapid pace.
Pakistan‘s sinking economy will show a rapid growth by 5. Fifth motive is to eradicate terrorism and militancy from the
attracting more foreign investment and joint projects with the country and the region through economic emancipation.
foreign governments to increase its exports. It will also Pakistan has suffered huge losses in the War on Terror.
minimize the current gap in China-Pakistan imbalanced Afghanistan, China and Central Asian states also face the
bilateral trade volume, now more favorable to China. challenges of militancy and separatism. The eradication of the
2. Second is the development of infrastructure capability of the menace of terrorism through the economic initiatives is a slow
country, severely needs improvement particularly since the process but with durable impacts. Sixth objective of Pakistan
start of the War on Terror. A country‘s development is gauged is to explore new minerals and scientifically utilize the
by various factors where infrastructure is one of the most already discovered ones. Resource-rich Pakistan is attractive
important elements. Pakistan‘s poor transportation and for China and future‘s foreign investors to play a win-win
industrial network have created a hindrance in boosting the game. The jobless youth will be benefited with modern
national economy. The scene is worse to see in the backdrop technological skills to raise the living standard high and make
of the wave of terrorism and militancy in the region where a economy stronger.
huge loss has been incurred to infrastructure. Various roads
6.3 Objectives of China and Pakistan in CPEC

CHINA’S INTERDEPENDENCIES PAKISTAN INTERDEPENDENCIES

ON PAK ON CHINA
Reduce the risk of violence in the Attract aid and foreign direct investment
bordering Xinjiang region from Pakistan- to boost economic growth, create jobs,
CA
based drivers of instability. Pakistan PA enhance productivity, and increase
blockade to the aid of Xinjiang Muslims exports.
and support.
Offset slowing domestic economic Obtain financing for electricity
growth by exporting excess capacity and generation and transmission projects to
supply. Making Pakistan and other Asian eliminate shortfall, meet future
CB PB
countries China’s market through residential and industrial demand, and
accessing Pakistani region. achieve a more affordable and diverse
energy fuel mix.
Redirect FOREX reserves from US Upgrade road and rail infrastructure to
Treasury bills toward projects abroad enhance regional connectivity and
CC with higher rates of return with the PC ground logistics efficiency.
investment of CPEC project there china is
dependent on Pak land and assets

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Demonstrate a new, China-led, win-win Reduce dependence on the Karachi port

model of international development. and Port Qasim, lowering port congestion
Diplomatic relationship with Pakistan can and making a potential full Indian naval
CD lead to an international Business Model PD blockade less likely. For that Chinese
for China to become No. 1 Economy of help will be required in developing and
the world investing in CPEC

China is dependent on Pakistan in sense Leverage Chinese investment and

of accessing its market and skilled labor expertise in industrial zones to bolster
CE on low cost in CPEC and more profitable PE and diversify manufacturing sector
good can be produced with direct benefits through industrial zones producing
to China higher value-added goods.
Reduce dependence on Straits of Malacca Modernize and diversify agricultural
as transit route for energy and trade, as industry through Chinese investment and
well as raw materials extracted from East transfer of technology.
Africa. It will also reduce the oil arriving
CF PF
days in china from Arab countries. China
will be dependent on Karakoram to get to
oil needs less than 10 days where as
previously it used to take 45 days
Secure refueling, replenishing, and ship Expand the Sino-Pak relationship beyond
repair facilities in the Indian Ocean a strategic and military alliance into an
CG PG
region. economic partnership as well.

Break out of US containment efforts. Use CPEC as a demonstration effect,

indicating to other investors that Pakistan
CH PH
is a safe and attractive destination for
foreign direct investment.
Enhance food security by investing in and Establish Pakistani ports as
CI sourcing agricultural and livestock PI transshipment hubs for Central and South
products from Pakistan. Asia and western China.
6.4 China
Pakistan & Power Politic of Interdependencies interdependence provide chances of influence to actors in dealings
International relations and diplomacies has been changing with one another. In such a relationship the less dependent actor
right after WWII and in late 1970s it has become clear that in forth can use the asymmetric interdependence for power position in
coming future many different interdependent blocks will arise on bargaining over an issue or bunch of issues. This asymmetric
the world’s map. A collaborative environment between the United dimension further provides a political bargaining process to actors
States and the Soviet Union, normalization of relations between (Nye, 1977). Looking into asymmetric interdependence, China has
Washington and Beijing; the OPEC states‘ strategies against the an upper hand in dealing with Pakistan within the CPEC. The 46
West and the worldwide economic engagements, mostly in billion dollars will be provided by China for various projects in
Europe, paved the way for avoiding conflicts and power politics. Pakistan. Also, various Chinese companies are involved in
The states ‘relations long remained inter-governmental throughout extracting different minerals, maximizing energy cooperation and
the diplomatic history but now extended to transnational, non- providing technical assistance to develop the Gwadar Port. The
governmental and trans-governmental partnerships. Same is the China-Pakistan bilateral trade is imbalanced; favoring China. But
case of China-Pakistan relationship under the China-Pakistan geographically Pakistan is more advantageous than China. (Nye,
Economic Corridor by the explanation of the politics of 1977) He argues that the vulnerability dimension of
interdependence. This theory was put forward by Robert O. interdependence rests on the relative availability and costliness of
Keohane and Joseph S. Nye in 1977 in their book “Power and the alternatives that various actors face‖. Pakistan provides a
Interdependence: World Politics in Transition”. shortest route to China to be connected with the Middle East,
Interdependence in world politics refers to situations North Africa and beyond; for its trade and energy supply. Among
characterized by reciprocal effects among countries or among the three corridors under the One Belt and One Road’ initiative, it
actors in different countries‖ (Keohane & Nye, 2012: 7). China and is the easiest extension and most economical route for China.
Pakistan, though, not totally dependent on one another but are Other alternatives of going through Russia or Tajikistan and
engaged interdependently. This engagement under Afghanistan reaching to Iran; require more time, finance and
interdependence has provided both countries to contribute in logistic support.
various dimensions of their bilateral relationship. China and However the economic infrastructure among states is a
Pakistan will gain from the projects under CPEC but not challenge when it hinders the transaction. It brings costs to states
necessarily that the advantage will be balanced. Symmetric on two levels. Normal interaction between two states involves an
interdependence is possible but very rare. Asymmetries in understood accepted cost. For instance, trade routes channelize the

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capacity to supply goods and services across the geographical and economic and security costs to avoid any hindrance.
political boundaries. The economic infrastructure among states is Interdependence in international and regional politics is positive
complex, thus states willingly bear costs to achieve the advantages connectivity with immediate neighbors. This will require changes
that motivate the trade relations. States make these costs to fully in Pakistan‘s foreign policy strategy that has, in the past, preferred
utilize the benefits of trade. However, further costs are possible in closer economic ties, trade and security interaction with the far-
case of changing the relationship or the economic infrastructure away states in order to cope with the security threats from within
among those states. The economic infrastructure within Pakistan the region of its geographic location. Now, Pakistan will be
and China are different from each other. If China has a vibrant required to cultivate more active relations with the immediate
economy with a rapid speed to grow, Pakistan‘s economy is neighbors for sharing energy and pursuing economic development
destabilized due to various factors of political instability, and trade. This will give a major boost to Pakistan‘s economy. The
corruption and sufferings in War on Terror. Islamabad and Beijing areas adjacent to the Corridor will experience a major economic
have joined hands together by forming Joint Working Groups uplift.
(JWGs) to foster the CPEC projects and bear all the political,

VII. 7.0 MODEL OF INTERDEPENDENCIES

CA CA

CB CB
CC CC

CD CD

CE CE
CHINA PAKISTA
CF N CF

CG CG

CH CH

CH CH

INTERDEPEND
ENT

this Indian strategy seems failing with naïve Trump’s

VIII. 8.0 DIPLOMATIC RELATIONS administration requirement form Indian government. Indian since
8.1 Indian-American Response to CPEC 2013, year of CPEC contract, has claimed that Route passing
CPEC is currently world’s largest route under-construction through Kashmir is Indian area but Pakistan has denied it. Both
and will the current economical regimes of the world. Indian the countries have remained involved in many military and
another neighboring country to China and Pakistan is directly nonmilitary un-conventional wars. Recently India blamed
opposing to this economical interdependent collaboration of both Pakistan for Pulvama attacks in disputed area of Kashmir, in Feb
the countries because it will kill the Indian dream of becoming 2019 and Pakistani Prime Minister Imran Khan’s speech has
Asian Economic Leader. With the help of America who is completely denied it and invited Indian extremist government for
indirectly in opposition Pak-China Friendship, India has tried to investigative exchange but Narainder Modi’s establishment
gain with mutual contract on Chabar Port, Iran in Competition. But conducted surgical strikes on Pakistan which has worsened the

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peace situation of the region. Pakistan continuously offering peace pressure as a means to deeply reshape the US alliance system and
solution as per United Nations resolution on disputed Kashmir but current rules, thus strengthening the suppression and regulation of
Indian military actions have silently denied to the sit-table the US "opponents."
arguments. After the Pulvama IAF strike lead to capture of Indian On the one hand, economic globalization is in a low tide,
Mix21 Pilot Abhinandan. Imran Khan, being a person of peace populism is booming in Western countries, the transatlantic
gesture released the war criminal to Indian authorities. This blame alliance is showing signs of rift, the return of geopolitical conflicts,
game from India was to weaken the CPEC project and to and the deterioration of the contradictions of ethnic groups. It
diplomatic killing of Pakistan’s International Relations but this shows that after the Second World War, the United States led the
power politics had no effect on Pak-China relationship and CPEC. establishment and after the Cold War to the non-Western the
U.S.A on the other hand has trade ties with India for covering "liberal international order", which is gradually expanding in the
Asian market and to remain the no. 1 economy of the world had world, is in deepening crisis. The US national security strategy has
pushed India to access Indian market many contracts of mutual seen a major shift in its core goal of responding to the competition
trades were signed. America trying to sustain its economical of big countries, and regards China as a more threatening force
power has allied Indian regime on many fronts but Indian than countries such as Russia. In December 2017, the Trump
Government’s failure to give American access to Indian market administration issued documents such as the National Security
has lead this partnership in perishing moments. Strategy report and the National Defense Strategy report,
U.S. President Donald Trump looked set to open a new front in his criticizing China's internal and external policies, and clearly
trade wars on Monday with a plan to end preferential trade positioning China as a “revisionist country” and a US “strategic
treatment for India that allows duty-free entry for up to $5.6 competition”. ", and will increase the competition for China to the
billion worth of its exports to the United States. United States height of "geopolitical competition between the free world order
policy of partnering India and making power politics of and the repressive world order." These reports highlight the reality
interdependencies with Indian government has not played well and of the strategic competition between the two countries, which
the presumed threat to Pak-China relationship has been decreased largely reflect the consensus of the US strategic community and
by high end nodes and interdependencies marks the United States' attempt to concentrate on responding to
the "China Challenge."
8.2 Sino-U.S.A International Politics and Diplomacy
An important pillar of China's national development and
global diplomacy, the “Belt and Road Initiative” has received IX. 9.0 CONCLUSION
more attention from the US strategic community. Since 2018, the China and Pakistan are determined to complete the CPEC
debates and policy debates around the “Belt and Road” in the project at all costs. It will bring economic prosperity and stability
United States have heated up significantly, and the US to both states as well as to the region. It would only be a
administrative and legislative branches have gained greater quantitative expansion in the domain of economy. CPEC is likely
consensus on balancing the “Belt and Road”. The US strategic to expand in due course to provide interconnectivity with
community generally believes that the impact of China's continued Afghanistan, Iran, the CARs and others. CPEC is indeed a long
promotion of the “Belt and Road” construction cannot be project. Geographically, China is more vulnerable as it is
underestimated. It not only has the potential to change the geo- dependent on Pakistan‘s geography having geo-strategic
economic and geopolitical balance of Eurasia, but also in many importance. It is for the first time in their bilateral relationship that
fields such as technical standards, military security, and a huge amount of investment is being provided by China for a
international development. It poses a real challenge to the United number of projects with the help of different government and
States and even undermines the foundation of the global private companies, banks and business communities.
hegemony that the United States established after the Second Private Pakistani companies have already started having
World War. The Trump administration began to enrich and refine some direct interactions with their Chinese counterparts. As far as
the “free and open Indo-Pak strategy” (hereinafter referred to as societal level interactions are concerned, they might also start to
the India-Pacific strategy), promote the negative arguments such have their presence felt, but it would take a long time. The main
as the “debt trap” of China’s manufacturing; reform the reason for that is strong language and cultural differences.
international financing mechanism and many other Ways, Viewing the costs, Pakistan is more vulnerable3, as country has
constantly increase the balance of the "Belt and Road". It can be suffered negatively due to War on Terror and political instability.
said that the game around the “Belt and Road” focuses on the But it is hoped that CPEC will enhance the annual bilateral trade
rising competitive factors in Sino-US relations and the overall volume and make it less imbalanced in future. Last but not least is
trends and main features of the US implementation of competitive the fact that China and Pakistan have entered into their
strategies toward China. interdependent relationship which may evolve into complex
Since the Trump administration took office, it has adhered to interdependence in future.
the "US priority" line, continuously adjusted the US internal and
external policies, and adopted a grand strategy characterized by
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