x Abu Dhabi, UAEFriday 19 January 2018

Gwadar port is missed chance for Pakistan

Pakistan wasted its opportunity to make Gwadar port a new economic engine for Baluchistan. But with new Chinese management, it may not be too late.

For those who wish to see Pakistan fulfil its economic and regional potential, the story of the deepwater port at Gwadar is a disappointing tale. As The National reported yesterday, the port on the Arabian Sea was completed in 2007, largely funded by China to the tune of $200 million (Dh735m). But since then, it has been a financial failure. Now operational control of the port is now poised to pass to a Chinese company.

The port, in Baluchistan province, is strategically important, for both Pakistan and China. For both, it is a foothold on the Arabian Sea. China has taken such an interest because Gwadar is near the Strait of Hormuz, through which so much of the world's oil passes. So it is a foothold from where pipelines could be built across Pakistan to western China, bypassing the long sea-route to China's east.

Though the port has been operated since 2007 by a Singapore-based company, its failure is largely of Pakistan's making. However impressive the harbour and facilities, Gwadar is useless without transport links into the country behind it. Dubai offers a fine example of the benefits conferred by a modern port with sound infrastructure behind it.

But at Gwadar, despite promises and clear economic incentive to build a road network into the hinterland, this has not materialised. A 900km road linking the port to the Indus Highway, taking goods south to north across Pakistan and to China, is still only 60 per cent finished. The suggestion now is that China will step in to fund the remainder of the road.

Both Pakistan and China stand to gain from this arrangement.

Officials have suggested the road delay stems from a long-running insurgency in Baluchistan. Indeed, Pakistan could have done much more to ease the concerns that fuel Baluchi separatism. The lure of brisk new economic activity in a poor region would have been hard to resist.

China has made a comparable calculation: Beijing is battling its own low-level insurgency in Xinjiang, the westernmost province of China. Beijing hopes that a busy trade route and related economic activity in Pakistan would have a knock-on effect in Xinjiang and dampen the trouble there.

The prospect of a Chinese-operated port on the Arabian Sea may raise alarms in the US and India. But this is not primarily about China. It is about short-sightedness and corruption that have caused Pakistan to ignore - until now - an immensely valuable opportunity to improve its economy and at the same time gain strategic advantage.