Gwadar Port to emerge as most strategic port of entire region

Gwadar Port to emerge as most strategic port of entire region

ISLAMABAD - Gwadar is a port city on the southwestern coast of Pakistan’s largest province, Baluchistan. The Gwadar port is expected to revolutionize the economic, socio-economic, financial and strategic landscape of Pakistan in its entirety. After the completion of the port, Middle East, Central Asia and South Asia are all expected to be connected economically. Once developed, this port is going to serve as a financial hub for the entire region, beginning a new era of prosperity in Pakistan.

Gwadar’s strategic location has already attracted investors’ attention with China taking the lead in the development of the entire port project via CPEC induced investments. In 2013, the port was handed over to the China Overseas Ports Holding Company. China has taken the initiative to develop the port as part of the China Pakistan Economic Corridor (CPEC) which is part of the China’s One Belt, One Road global infrastructure project.

The geostrategic location of Gwadar offers a unique status to Pakistan as it also provides access to the Central Asian region. Moreover, geographical proximity of Gwadar port has a special significance when it comes to the GCC countries. Gwadar’s close distance with Muscat port (almost 385 km) only validates its strategic importance further as it offers an alternative trade route to the world. A number of GCC states have shown interest when it comes to the development of the Gwadar district. Recently, a major water filtration plant was inaugurated in Gwadar with the help of GCC states which show that the latter is not only interested in ensuring that the region develops but also recognizes its emerging strategic significance.

“The expected extension of CPEC has a potential to revive Afghanistan and Pakistan’s fragile economics, and can ultimately prove to be an effective weapon against forces that benefit from the economic underdevelopment of this region”

As the government in Pakistan has said a number of times that opportunities being created under the CPEC are not only going to benefit Pakistan. The entire region can benefit from this success story. CPEC promises to begin a new era of prosperity not only for Pakistan but for the entire region. South Asia, Pakistan and Afghanistan, are one of the least economically connected countries in this region. With the successful implementation of CPEC, this may change soon: China is interested in expanding CPEC further to Central Asia through Afghanistan. This expected extension of the CPEC has the potential to revive Afghanistan and Pakistan’s fragile economics which can ultimately prove an effective weapon to fight against forces that benefit from the economic underdevelopment of this region.

While some regional states have opposed the project, Pakistan with the help of China – a key stakeholder in this financial scheme – is willing to overcome all challenges to ensure that CPEC becomes operational. With the development of the Gwadar, majority of Beijing’s imports are expected to pass through Pakistan which has a potential to lift Pakistan’s struggling economy. It’s important to note that China is one of the largest oil importers in the world and Pakistan offers a ‘short’ and strategically important location for Beijing to route its imports through Pakistan. Qatar has also invested over $1billion in the natural gas sector. Pakistan’s close friend, Saudi Arabia, has also expressed an interest toward the development of Gwadar. Iran has already shown an interest to join the China lead economic block. If Iran joins the CPEC, Pakistan’s economy can benefit further, for the former can help Pakistan in overcoming its energy and gas shortages to a great extent given the country’s massive oil reserves which largely remain untapped. A number of other states, including China are setting up oil refineries in Gwadar which in the new future would reduce Pakistan’s energy shortages further. With the potential to handle ships over 50,000 tons in terms of weight, Gwadar port is also expected to generate business activity worth $50 billion annually at its peak.

Overall, Gwadar represents an excellent economic opportunity for Pakistan, China and other interested stakeholders.

By: Hasnnain Javed. *Master Trainer/ Advisor (Pakistan Industrial Technical Assistance Center, Lahore operated under Federal Ministry of Industries and Production, Islamabad)*