China-Pakistan Economic Corridor (CPEC) is collaboration between Pakistan and China to pull together a multiple projects based on infrastructure development which is right now under the construction phase in various parts of Pakistan. In 2017 value of CPEC projects has been calculated to be $62 billion. The project of CPEC is expected to create an improved infrastructure in Pakistan which will result in the growth of its economy, mainly through the upgrade and development of transport system and energy project which will benefit Pakistan in a way that the economy will become strong and foreign investment would be attracted in the region. In November 2016 Chinese cargo was established at Gwadar port to carry out marine shipments through the port to West Asia and Africa which made CPEC operational at stage one. Some of the mega power based projects also kicked off in late 2017.
CPEC has focused on the expansion of transportation networks throughout Pakistan by means of roads and railways which will facilitate the economy by reaching the region of Pakistan efficiently for any sort of trade purpose. Pakistan’s government has calculated that the poor conditions of current infrastructure have caused a loss of 3.55% in Pakistan’s annual GDP. Carefully designed by the best professional transport systems which are going to be spread in Pakistan under CPEC will connect seaports of Pakistan (Gwadar and Karachi) with not just northern areas of Pakistan but also with Western parts of China and Central Asia.
The projects of CPEC will construct a 1,100 km motorway between Karachi and Lahore, whereas Karakoram Highway will be repaired from Hasan Abdal to China Border. Furthermore, Rail lines from Karachi to Peshawar will also be upgraded in terms of construction and technology enabling it to travel on train at the speed of up to 160km/hour ideally till the end of December 2019. Pakistan would be linked to China’s Southern Xinjiang Railway in Kashgar via its upgraded and improved railway track under the project of CPEC. Subsidized concessionary loans will finance the projects which are estimated to be $11 billion which will completely upgrade the transport system and network in Pakistan.
There is an obvious chronic shortage of energy in Pakistan which needs some facilitation; about $33 billion is going to be invested in the energy based projects under CPEC which are going to be completed by private companies. Over 4,500MW of shortage is calculated which is 2 to 2.5% of Pakistan’s annual GDP. CPEC is going to generate over 10,400 MW capacity of energy by 2018, most of them being CPEC; s fast tracked projects. CPEC is also going to spread a pipeline network which will be carrying out the transportation of oil and liquid natural gas in between Gwadar and Nawabshah which will be able to transport oil and gas from Iran, the pipeline worth $2.5 billion. Electricity generation is going to be mainly through fossil fuels, hydroelectric and wind-power generation and it will also include the development of world’s largest solar power generation plants.
CPEC is a huge developmental collaboration which is often compared to Marshall Plan by US in Post war Europe. CPEC is huge in its nature that it will create an estimate of 2.3 million job opportunities in the duration of 2015-2030 and an improvement of 2 to 2.5 percent in the annual economic growth of Pakistan.
20% of CPEC financing is based on debt and the rest of 80% are the investments as joint ventures of Pakistan and China. It is said that CPEC will create a total of 40,000 jobs for locals of Pakistan and 80,000 jobs for Chinese workforce. Total of CPEC loan on Pakistan is approximately equivalent to 6% of Pakistan’s GDP due to which Indians call it a debt trap. Whereas economic analysts have identified the benefits of CPEC to result in overcoming major energy shortages in Pakistan which have huge negative impact on the economic growth of Pakistan