x Abu Dhabi, UAEWednesday 26 July 2017

Road and rail link is a significant step

A deal between China and Pakistan will also have implications for the Gulf nations.

On Friday, the governments of China and Pakistan agreed a deal to build a road and rail transport link to connect the two nations. The project promises to open a wide "economic corridor". While no firm timetable for development has been announced, this "long-term" plan will eventually connect Kashgar in western China with Gwadar in Pakistan in the west. The potential gains from such links are huge.

The project will undoubtedly foster greater commercial ties between the two nations, but it will also have serial implications for other parts of the world.

It could, as The National reported yesterday, allow for oil shipped from the Middle East to be unloaded in Gwadar, close to the mouth of the Arabian Gulf, before being moved overland to China. And while this would still represent an epic logistical endeavour, it would also substantially reduce, by several thousand kilometres, the distance oil would have to cover to get to any destination point in China, and at a time when it is encouraging the development of its western region. In general, it is likely to deliver an upturn in trade between the GCC group of nations and Asia.

For Pakistan itself, the road and rail link will create jobs, help reinvigorate almost every sector of its embattled economy and afford it more breathing space away from its neighbours.

But this link is likely to have many other consequences, too. For those observers who nervously watch any time China furthers its international reach and influence - be that in Africa, Asia, the Americas or even on the high seas - this latest development could be perceived as troubling. China supplies more arms to Pakistan than any other nation and a reciprocal deal might see the port at Gwadar reused as a strategic platform for China's naval operations in the region. The port has been redeveloped in recent years with substantial investment from China.

When the Suez Canal opened in 1869, it changed the way the world worked. Nearly 150 years later, eight per cent of global shipping traffic passes through its waters. Similarly, the Panama Canal allows ships to move from the Pacific to the Caribbean Sea in less than 12 hours.

Like both of these examples, the Kashgar to Gwadar road and rail link could eventually prove game-changing regionally and economically.