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China–Pakistan Economic Corridor

China–Pakistan

CPEC's potential impact on Pakistan has been likened to that of the Marshall Plan undertaken by the United States in post-war Europe. Economic corridor comprising a collection of projects currently under construction at a cost of $54 billion. Corridor stretching from the Chinese border to Pakistan's deep water ports on the Arabian Sea date back to the 1950s, and motivated construction of the Karakoram Highway beginning in 1959.

Chinese interest in Pakistan's deep-water harbor at Gwadar had been rekindled by 1998 and in 2002 China began construction at Gwadar port which was completed in 2006.

Pakistani officials predict that the project will result in the creation of upwards of 700,000 direct jobs between 2015–2030, and add 2 to 2.5 percentage points to the country's annual economic growth. Were all the planned projects to be implemented, the value of those projects would be equal to all foreign direct investment in Pakistan since 1970, and would be equivalent to 17% of Pakistan's 2015 gross domestic product

The current form of the project was first proposed by General Pervez Musharraf. However it was postponed owing to the political instability in the country that followed Musharraf's step down. The subsequent government of the Pakistan People’s Party proposed it again when President Asif Ali Zardari invited heads of all the political parties to a Luncheon in honor of the Chinese Premier Li Keqiang at the Aiwan-e-Sadr on 22 May 2013.Chinese Premier Li Keqiang and the Pakistani President Asif Ali Zardari have agreed to build an economic corridor between the two countries.

In 2014 Pakistan Prime Minister Nawaz Sharif met with Premier Li Kequiang in China to discuss further plans, resulting in the full scope of the project to be devised under Sharif's tenure, In November 2014, Chinese government announced its intention to finance Chinese companies as part of its $45.6 billion energy and infrastructure projects in Pakistan as part of CPEC.

 This is roughly 20% of Pakistan’s annual GDP, with approximately $28 billion worth of fast-tracked “Early Harvest” projects to be developed by the end of 2018. As a gesture of friendship, the Pakistani capital at that time was dotted with slogans and signboards such as "Pakistan-China friendship is higher than the mountains, deeper than the oceans, sweeter than honey, and stronger than steel"[34] – an oft repeated phrase coined by the Chinese to describe their deep ties to Pakistan.               

Gwadar forms the crux of the CPEC project, as it is envisaged to be the link between China's ambitious One Belt, One Road project, and its Maritime Silk Road project. In total, more than $1 billion worth of projects are to be developed around the port of Gwadar by December 2017. China will grant Pakistan $230 million to construct a new international airport in Gwadar which is to be operational by December 2017.

The city of Gwadar is further being developed by the construction of a 300MW coal power plant, a desalinization plant, and a new 300 bed hospital. Plans for Gwadar city also include construction of the East Bay Expressway – a 19 kilometer controlled-access road that will connect Gwadar Port to the Makran Coastal Highway,] these additional projects are estimated to cost $800 million, and are to be financed by 0% interest loans extended by the Exim Bank of China to Pakistan.

The CPEC project envisages major upgrades and overhauls to Pakistan's transportation infrastructure. Under the CPEC project, China has announced financing for $10.63 billion worth of transportation infrastructure so far; $6.1 billion have been allocated for constructing "Early Harvest" roadway projects at an interest rate of 1.6 percent.

The CPEC project envisages major upgrades and overhauls to Pakistan's transportation infrastructure. Under the CPEC project, China has announced financing for $10.63 billion worth of transportation infrastructure so far.

The CPEC project including rebuilding of the entire Main Line 1 railway between Karachi and Peshawar by 2020, this single railway currently handles 70% of Pakistan Railways traffic. In addition to the Main Line 1 railway, upgrades and expansions are slated for the Main Line 2 railway, Main Line 3 railway. The CPEC plan also calls for completion of a rail link over the 4,693-meter high Khunjerab Pass. The railway will provide direct access for Chinese and East Asian goods to Pakistani seaports at Karachi and Gwadar by 2030.

Energy generation will be a major focus of the CPEC project,   approximately $33 billion expected to be invested in this sector.

Liquefied natural gas power LNG projects are also considered vital to CPEC. The Chinese government has announced its intention to build a $2.5 billion 711 kilometer long liquid natural gas pipeline from Gwadar to Nawabshah in province as part of CPEC.

The long-term plan for the period 2025-30 during the CPEC summit held in Islamabad on August 30, 2016. The plan includes cooperation over livelihood, water resources, livestock, people-to-people communications and financial matters. Under the plan, agricultural information project, storage and distribution of agricultural equipment and construction project, agricultural mechanization, demonstration and machinery leasing project and fertilizer production project for producing 800,000 tons of fertilizer and 100,000 tons of bio-organic fertilizer will be implemented.

As part of CPEC, the two countries signed an Economic and Technical Cooperation Agreements well as pledged to "China-Pakistan Joint Cotton Bio-Tech Laboratory, The two countries also pledged to establish the "China-Pakistan Joint Marine Research Center" with State Oceanic Administration and Pakistan's Ministry of Science and Technology. Also as part of the CPEC agreement, Pakistan and China have agreed to co-operate in the field of space research, many other,

The two nations also pledged co-operation in field ranging from anti-narcotic efforts. Approximately $11 billion worth of infrastructure projects being developed by the Pakistani government will be financed by concessionary loans, with composite interest rates of 1.6%.

CPEC is considered economically vital to Pakistan in helping it drive economic growth, The Straits of Malacca provide China with its shortest maritime access to Europe, Africa, and the Middle East, Approximately 80% pass of its Middle Eastern energy imports also pass through the Straits of Malacca. [246] as the world's biggest oil importer. The heads of various Central Asian republics have expressed their desire to connect their infrastructure networks to the CPEC project via China


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