The China-Pakistan Economic Corridor of the Belt and Road Initiative, by Dr. Wolf

In the first half of 2019, Dr. Siegfried Wolf, research director at the South Asia Democratic Forum, published a reference work on the China Pakistan Economic Corridor.

“The China-Pakistan Economic Corridor of the Belt and Road Initiative: Concept, Context and Assessment” is one of the first books to pay close attention to this corridor. While many researchers have analyzed the development of the new Silk Roads and the Belt and Road initiative, few of them had studied the China Pakistan Economic Corridor (CPEC), yet one of the most structuring corridor of  the BRI. This is now done thanks to the work of Dr. Wolf, which should become a must read for future researchers interested in this topic.

Book summary

Siegfried Wolf’s book opens on the lack of connectivity in South Asia and presents the China Pakistan Economic Corridor, giving an introduction to the history of Sino-Pakistani relations. This first introductory chapter shows the importance of this corridor project.

The author is precisely interested in what is an economic corridor, and shows that this concept remains unclear. For Dr. Wolf, the concept of corridor should not be limited to transport and trade, but should be viewed in a more global development approach, based on economic, political and social criteria.

The work then continues on the Chinese (Chapter 3) and Pakistani (Chapter 4) motivations for the realization of this large-scale project. With regard to China, he affirms that there is not yet a consensus on the interpretation of this project and mentions both internal factors (industrial overcapacity, modernization of Chinese industry …) and external factors (internationalization of renminbi…) to the Belt and Road initiative. The chapter on Pakistani motivations is more innovative. According to the author, Pakistan’s interests are multiple and touch on economic, social, political, geostrategic, and security aspects. Through the CPEC, Pakistan hopes to strengthen its infrastructure, reduce regional inequality, and create jobs. On the international scene, through its rapprochement with China, Islamabad wishes to reduce the asymmetry with India, to be less dependent on the United States, but also to improve its image.

But to achieve these goals, China and Pakistan face multiple challenges (Chapter 5). These obstacles can be of a security nature, including terrorist threats, but also constitutional threats. Thus, Dr. Wolf points to the vague status given to Gilgit-Baltistan, a key region of the CPEC, in the Pakistani constitution, which could frighten foreign investors. He also explains how the very strong participation of the Pakistani army in business can also be an obstacle. This chapter ends with environmental risks in Pakistan that can threaten infrastructure projects.

The sixth and most important chapter assesses the CPEC according to several indicators. The author thus analyzes the first results of the CPEC in terms of internal and external connectivity; it also assesses the impact of the corridor on Pakistani society (development, regional inequalities, the fight against terrorism, etc.), and questions the economic viability of this project. He regrets the lack of transparency and deplores the role given to the Pakistani army in projects related to CPEC.

The author then studies relations between Pakistan and the European Union (chapter 7), and Afghanistan (chapter 8). According to Dr. Wolf, the development of the China Pakistan corridor would further weaken relations between Pakistan and the European Union. Pakistan benefits from the Generalized System of Preferences Plus (GSP +) from the EU. According to the author, Europeans are increasingly reluctant to grant this status to Pakistan because of the poor governance progress realised by Islamabad. The development of the CPEC would make it possible to free Pakistan even more from European demands.

The author then examines the possible extension of the BRI to Afghanistan. For Dr. Wolf, China is more and more present in Afghanistan and hopes for the stability of the country; however, he notes that cooperation between Pakistan and Afghanistan is still limited. For Islamabad, Kabul has adopted a pro-India position and an extension of the silk road in Afghanistan could threaten the activity of its own special economic zones.

In his ninth and penultimate chapter, the author analyzes the relationship between democracy and development in Pakistan. According to him, CPEC projects would strengthen the role of the military in the Pakistani economy and could in the long run weaken the democratic process in that country.

“The China-Pakistan Economic Corridor of the Belt and Road Initiative: Concept, Context and Assessment” ends with the author’s conclusion which goes back to the impacts of CPEC on the economy, regional cooperation, security and social dimension. He concluded that CPEC, in its current format, is not an economic corridor.

Analysis

“The China-Pakistan Economic Corridor of the Belt and Road Initiative: Concept, Context and Assessment” is undoubtedly the most comprehensive work to date on the CPEC. Extremely well referenced, it allows us to better understand the challenges facing Pakistan. Its author, Dr. Siegfried Wolf has a very profound knowledge of Pakistani society and relations between Pakistan and its neighbors. He knows Pakistan’s weaknesses. According to the author, Pakistan suffers from several evils, such as the lack of transparency, which limits its development, and the CPEC would not solve these problems. Through this study of the China Pakistan corridor, Dr. Wolf shows us in fact certain Pakistani challenges, a country that remains relatively unknown in Europe.

However, it is regrettable that the author does not have the same expertise in China as in Pakistan. Dr. Wolf is a recognized expert on issues relating to South Asia, but his analysis of the CPEC from the Chinese side is somewhat more limited. Thus, few Chinese references, apart from newspaper articles, are mentioned. Consequently, the vision presented for the Belt and Road initiative seems relatively static, and takes little account of Chinese questions about this project, and the developments taken by the BRI. So, if governance and funding problems may have characterized the beginnings of the BRI, China is now trying to take better account of these challenges. The deceleration of the Chinese economy and the internationalization of Chinese companies are pushing the promoters of the new Silk Road to seek new financial sources that are not exclusively Chinese and to be more attentive to the projected image of the BRI (and therefore to make efforts in terms of governance).

It may also be unfortunate that the author has adopted a relatively somber and pessimistic tone on the results of the CPEC on Pakistani society and economy. Pakistan, as the author points out, faces many societal, economic, political and security challenges. The CPEC may not resolve all of these questions, but it can be an important first step towards a clearer horizon; not least because the CPEC could transform the image of Pakistan in the eyes of foreign, Chinese and other investors. Furthermore, it may still be too early to “assess” the China Pakistan economic corridor; China has given itself until 2049 to revive the new Silk Road, and we must not forget that the success of CPEC will also depend on other connectivity projects developed within the BRI. The author’s analysis does not stop in Pakistan, he is also interested in relations between Islamabad and its neighbors, – for him bad relations with India and Afghanistan, are detrimental to CPEC-, the United States and Europe. But it would also have been interesting to study more closely the development of BRI projects in other regions such as Central Asia and the Persian Gulf and their implications for the CPEC.

Of course, as the author notes, with the CPEC, Pakistan will become more dependent on China. But this observation can be applied to many other countries as China is on the way to becoming the world’s leading power.

This work is relatively clear and well structured, even if we can regret some redundancies, in particular in chapter six on the evaluations of the CPEC which takes again some elements of the previous chapters, -perhaps these evaluations could have been brought in a different way?-. Dr. Wolf’s book is intended primarily for students and researchers interested in both connectivity corridors and Pakistan. We can hope that Pakistani and Chinese researchers and policy makers will also analyse this worth reading book, in order to work on the challenges noted by the author and propose solutions for a more effective CPEC.

This book is available on the publisher’s website.