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Pakistan's Choice: CAREC or SAARC or Both?

Pakistan sits between two economically very dynamic regions: Central Asia (and Western China) and South Asia. Which region is better suited for its economic connectivity and integration? Should Islamabad focus on CAREC (Central Asia Regional Economic Cooperation) rather than SAARC (South Asian Association of Regional Cooperation)?

Ideally, Pakistan should be a major player in both vibrant regions. However, Indian Prime Minister Narendra Modi's policy of attempting to isolate Pakistan has essentially forced it to choose.

First, Mr. Modi decided to boycott this year's SAARC summit that was scheduled to take place in Islamabad, Pakistan. Then, he unsuccessfully attempted to hijack the BRICS economic summit in India to use it as a political platform to attack and isolate Pakistan.  The signal to Pakistan was unmistakable: Forget about SAARC.

Central Asia Regional Economic Cooperation (CAREC):

CAREC is a growing group of nations that is currently made up of 11 members, including China and a list of STANs.   The current membership includes Afghanistan (joined CAREC in 2005), Azerbaijan (2003), People's Republic of China (1997), Georgia (2016), Kazakhstan (1997), Kyrgyz Republic (1997), Mongolia (2003, Pakistan (2010), Tajikistan (1998), Turkmenistan (2010) and Uzbekistan (1997).



The last ministerial meeting of CAREC nations was held in Islamabad in October, 2016. The conference theme was “Linking connectivity with economic transformation".

Welcoming fellow ministers, Pakistan's Finance Minister Ishaq Dar talked about the importance of the China-Pakistan Economic Corridor (CPEC) to improve trade flow within the region and with the rest the rest of the world.

Dar said CPEC offered a massive opportunity for connectivity between Central Asia, Middle East and Africa and was bound to play a defining role in economic development of the regions.

Dar said improving the transport corridor was not an end in itself but it was an investment in establishing sound infrastructure and complementary frameworks for shared prosperity of the present and future generations in the region, according to a report in Pakistani media.

CAREC Corridors:

CAREC region is building six economic corridors to link Central Asian nations. Six multi-national institutions support the CAREC infrastructure development, including the Asian Development Bank (ADB), United Nations Development Program (UNDP), International Monetary Fund (IMF), World Bank,  Jeddah-based Islamic Development Bank and European Bank for Reconstruction & Development, according to Khaleej Times.

Out of the total $27.7 billion CAREC infrastructure investment so for, $9.9 billion or 36 per cent was financed by ADB, a senior officer of the Manila-based multinational bank told Khaleeej Times.

He said other donors had invested $10.9 billion while $6.9 billion was contributed by CAREC governments. Of these investments, transport got the major share with $8 billion or 78 per cent. Asian Development Bank Vice President Wencai Zhang said: "There are huge financing requirements in Carec for transport and trade facilitation, for which 108 projects have been identified at an investment cost of $38.8 billion for the period 2012-2020. Investment for the priority energy sector projects will be $45 billion in this period."

CPEC North-South Corridor:

China Pakistan Economic Corridor (CPEC) is a major part of the north-south corridor that will allow trade to flow among CAREC member countries, many of which are resource-rich but landlocked nations. The corridor will enable the group to access to the Pakistani seaports in Gwadar and Karachi as part of the new maritime silk route (MSR) as envisioned by China and Pakistan.

Pakistan's Finance Minister Dar says the CPEC would complement the regional connectivity initiatives of CAREC. "Once the six CAREC corridors and mega ports, now under construction, start operating, they will provide access to global markets. They will deliver services that will be important for national and regional competitiveness, productivity, employment, mobility and environmental sustainability. All of us should gear our national policies to achieve these targets."

CPEC consists of transport and communication infrastructure—roads, railways, cable, and oil and gas pipelines—that will stretch 2,700 kilometers from Gwadar on the Arabian Sea to the Khunjerab Pass at the China-Pakistan border in the Karakorams.

China and Pakistan are developing plans for an 1,800 kilometer international rail link from the city of Kashgar in the Xinjiang Uygur autonomous region in Western China to Pakistan's deep-sea Gwadar Port on the Arabian Sea, according to Zhang Chunlin, director of Xinjiang's regional development and reform commission.



 "The 1,800-kilometer China-Pakistan railway is planned to also pass through Pakistan's capital of Islamabad and Karachi," Zhang Chunlin said at the two-day International Seminar on the Silk Road Economic Belt in Urumqi, Xinjiang's capital, according to China Daily.

"Although the cost of constructing the railway is expected to be high due to the hostile environment and complicated geographic conditions, the study of the project has already started," Zhang said. "China and Pakistan will co-fund the railway construction. Building oil and gas pipelines between Gwadar Port and China is also on the agenda," Zhang added.

Afghan Instability:

Pakistan is making a serious effort to stabilize Afghanistan, a member of CAREC. A trilateral conference of China, Russia and Pakistan is scheduled this month in Moscow as part of this effort. Afghan instability has prevented Pakistan from connecting with other STANs for commerce and trade. Now the development of CPEC will enable Pakistan to bypass Afghanistan, if necessary, to connect with Central Asia region through Western China.

Summary:

History shows that growth of regional and global trade in East Asia, Europe and North America regions has been a major driver of economic opportunity and prosperity.  Unfortunately, SAARC has been a huge disappointment for Pakistanis.  With the development of CPEC and CAREC, Pakistan can now begin to participate in the growth of regional and global trade that will benefit the people of Pakistan.  The path to Pakistan's participation in SAARC will open up if or when India-Pakistan relations improve.

Here's a National Geographic Documentary on CPEC:

https://youtu.be/q2lWYxbIBCs




Related Links:

Haq's Musings

1800 Km Pak-China Rail Link

China Pakistan Economic Corridor

CPEC to Create Over 2 Million Jobs

Modi's Covert War in Pakistan

ADB Raises Pakistan GDP Growth Forecast

Gwadar as Hong Kong West

China-Pakistan Industrial Corridor

Indian Spy Kulbhushan Yadav's Confession

Ex Indian Spy Documents RAW Successes Against Pakistan

Pakistan FDI Soaring with Chinese Money for CPEC


Views: 132

Comment by Riaz Haq on November 22, 2016 at 9:19pm

The Countries Building New Silk Road -- And What They're Winning In The Process. #CPEC #Pakistan #China via @forbes

http://www.forbes.com/sites/wadeshepard/2016/11/22/what-win-win-alo...

..almost as soon as the Soviet Union disintegrated, the countries of Central Asia and the Caucasus began looking for ways to reconnect again. Inspiration for the future was soon taken straight from the pages of history. During the days of what had retroactively been dubbed the Silk Road the countries of Central Asia acted as land bridge, connecting the booming markets of China with those in Europe. Ancient Silk Road cities like Xi’an, Samarkand, Merv, Aleppo, and Baghdad all acted as major transshipment and manufacturing centers, where middlemen would relay wares between all points of the Eurasian landmass. While there is certainly a large amount of romance attached to this simplified rendering of history, this rendering is serving as a functional road map as to how the region is moving forward and developing today.

Eurasia, as a contiguous continent stretching from the west of Europe to the eastern coast of China, is rapidly being drawn together into a massive market covering over 60 countries, 60% of the world’s population, 75% of energy resources, and 30% of GDP. Many plans have been brought forth by multiple regional players to guide this endeavor — the most dynamic of which is China’s multi-trillion dollar Belt and Road initiative — but the end goal of them all is the same: to create “win-win” solutions where all parties benefit by pursuing the similar goal of infrastructural development and economic integration.

“In order to create a situation where everybody is in the same boat in terms of economic development, they are putting together One Belt, One Road,” said Huang Jing of Singapore National University. “In other words, if everyone is economically in the same boat then if China goes up everybody goes up and if China goes down then everybody goes down. That’s the nature of the idea.”

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Pakistan currently finds itself caught in the middle of prolonged geopolitical and security quagmire. With a marked political struggle with India to the southeast, and having Iran to the west and Afghanistan to the north, the country’s economic potential has been very much stunted. Partnering with China on the China-Pakistan Economic Corridor (CPEC), a core part of the Belt and Road initiative, is seen as a key way not only for Pakistan to improve its energy capacities, enhance its infrastructure, and bolster its economy — and, ideally, assuage terrorism and other security threats in the process.

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Now a fundamental station on the China-led 21st Century Maritime Silk Road, Sri Lanka is engaging in large-scale infrastructure projects with China, which include Colombo Financial City — a financial center meant to rival Singapore and Dubai — a deep sea port in Hambantota, a new container terminal in Colombo’s port, the Mattala International Airport, and an impending 15,000 acre industrial zone that will reputedly attract 2,500 Chinese companies and create a million jobs. Although there have been multitudes of near catastrophic political, administrative, and debt problems associated with building this new infrastructure, the country’s prime minister still refers to it a once in a lifetime opportunity to jump-start development and generate a high-income society.

Comment by Riaz Haq on December 3, 2016 at 8:24am

#Russia and #Pakistan slowly move towards an embrace. #India #China #CPEC #Gwadar @AJEnglish
http://www.aljazeera.com/indepth/opinion/2016/12/russia-pakistan-sl...

Or, how Russia got a warm-water port without firing a shot.

Ahmed Rashid is a journalist and the author of five books on Afghanistan, Pakistan and Central Asia. His latest book is 'Pakistan on the Brink, the future of Pakistan, Afghanistan and the West'.

After decades of hostility, Russia and Pakistan are gingerly trying to improve relations. Russia is cautiously wooing Pakistan in a bid to temper Islamabad's support for the Afghan Taliban and to end the civil war in Afghanistan, which is threatening Central Asia - the soft underbelly of Russian influence in the former Soviet Union territories.

Pakistan faces increasing isolation in the region - spurned by India, Afghanistan and Iran, and criticised by the US and NATO countries - because of its continued harbouring of the Afghan Taliban. At present, it is solely dependent on Chinese economic and political support.

It is not surprising, therefore, that Pakistan is desperately keen to rebuild relations with Russia. Islamabad would like to use warmer ties with Moscow to counter US and western pressure and be able to boast of more than one ally in the region. 

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Pakistan offered Russia the use of Gwadar, its new Chinese-built port on the Gulf, which is close to Iran and opposite Oman. From Tsarist times, Russia has always wanted a port in the ''warm waters'' of the Gulf. When the Soviets invaded Afghanistan, Pakistan was convinced that the Russian dream was to have a base on Pakistan's Gulf coastline. Ironically, Pakistan is now offering the same facility.

However, Gwadar port is yet to become fully operational and it is surrounded by insurgencies in Afghanistan and Balochistan province. Its capacity is being enhanced by a Chinese-built network of roads that will eventually connect to the Chinese border in northern Pakistan. 

Use of the port by foreign ships is still some way off, and Pakistan has not made it clear if it would allow Russian warships to dock there. The Chinese navy has already been granted landing rights at the port.

Russia has also agreed to sell helicopters to Pakistan, lifting its decades-old arms embargo against Islamabad, while India is now looking for arms from Western nations such as the US and France.

Comment by Riaz Haq on December 15, 2016 at 5:28pm

#China’s #Pakistan project: a geopolitical game-changer. #CPEC #eurasia #India #OBOR https://goo.gl/MBNaAj via @east_asia_forum

David Brewster, ANU

China’s One Belt One Road (OBOR) initiative is carving out new pathways across the Eurasian continent, signifying Beijing’s ambitions to remake the world around it. This project, if implemented, will fundamentally change China’s role and relationships in South Asia, perhaps in some ways that are not intended.

In the Indian Ocean region, OBOR has two aspects. One is the Maritime Silk Road, a series of linked port projects aimed at facilitating trade and new production chains linked with China by sea. The other is a series of planned north–south pathways from China to the Indian Ocean, including the China–Pakistan Economic Corridor (CPEC) and the Bangladesh–China–India–Myanmar Economic Corridor. These projects come with huge price tags and would involve the construction of roads, railways, pipelines and other major infrastructure in corridors stretching for hundreds and even thousands of kilometres.

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But these new overland pathways also have the potential to fundamentally alter China’s role in South Asia and the entire strategic make-up of the region. Geopolitically, South Asia has long functioned more or less as an island rather than as part of a bigger continent. Any overland connections that South Asia has with the rest of the continent are, at best, tenuous and excepting a tiny proportion of trade that is carried overland to and from Eurasia, essentially all of South Asia’s connections with the rest of the world are by sea or air.

These geographic constraints have had considerable political, economic and strategic consequences for the region. One is in underpinning India’s role as South Asia’s predominant power. The relative lack of landward connections into the Eurasian continent also amplifies the importance of control over the maritime trade routes across the northern Indian Ocean.

Geography has also caused Eurasian states, such as China, to have very limited contact with their South Asian neighbours. Sitting on the other side of the Himalayas, China may as well have been on the other side of the world. While it has been a strategic player in South Asia for some time, it has been from far away. China’s virtual remoteness allowed it to keep its hands clean of domestic political and security problems, even while it provided substantial military and diplomatic support to the Pakistani government. This has helped China to project itself as a benevolent partner that does not ‘meddle’ in internal affairs.

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Pakistan has sought to address CPEC security risks by forming a special army corps of 12,000 personnel devoted to protecting the project. But, at least until recently, China has been surprisingly sanguine about these risks and its ability to rely on the Pakistan Army.

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In August 2016, in a national Independence Day speech, Indian Prime Minister Modi sent a clear message that India may begin to publicly support Balochistan’s separatist insurgents. This represents a big shift for India and was directed almost as much at Beijing as at Islamabad. A senior and well-connected Chinese scholar responded that China will have ‘to get involved’ if India seeks to disrupt the CPEC. On 21 September, in the wake of the deterioration in Indo–Pakistan relations over Kashmir, Chinese Premier Li Keqiang publicly warned his civilian Pakistani counterpart, Nawaz Sharif, that he ‘hoped’ Pakistan can continue to provide safety protection to the program construction and Chinese personnel in Pakistan. These may well be the opening moves to a whole new strategic dynamic in South Asia driven by China’s great OBOR ambitions.

Comment by Riaz Haq on December 19, 2016 at 6:59am

#Russia throws its weight behind #CPEC, #China-#Pakistan corridor, keeps #India on tenterhooks http://toi.in/eJCcoa via @timesofindia

Russia's nebulous public position on its growing ties with Pakistan continues to give sleepless nights to Indian policymakers who have sought to isolate Islamabad on the issue of terrorism.
After it officially denied reports that it had shown any interest in China-Pakistan Economic Corridor (CPEC), Moscow has not just declared strong support for the China-funded project but also announced its intention to link its own Eurasian Economic Union project with CPEC.
CPEC, which will link Gwadar in Pakistan's restive Balochistan province to Xinjiang in China, remains a major bugbear for Indian foreign policy as it passes through the Gilgit-Baltistan region in Pakistan occupied Kashmir (Pok) claimed by India. Beijing has shown scant regard for India's concerns despite PM Narendra Modi himself having taken up the issue of Chinese involvement in the disputed territory with President Xi Jinping.
Moscow last month emphatically denied Pakistan media reports that it was looking to involve itself in CPEC by acquiring access to the port built by China at Gwadar. Russia's ambassador to Pakistan Alexey Y Dedov has now been quoted as saying that Russia and Pakistan have held discussions to merge Moscow's Eurasian Economic Union project with the CPEC.
Dedov said Russia "strongly" supported CPEC as it was important for Pakistan's economy and also regional connectivity.
The mixed signals emanating from Moscow, as strategic affairs expert Brahma Chellaney said, are injecting uncertainty in the direction of the Russia-India relationship whose trajectory long epitomized constancy and stability.

"It is as if Moscow no longer sees India as a reliable friend or partner. Indeed, by seeking common cause with India's regional adversaries — including by supporting the China-Pakistan Economic Corridor through internationally disputed territory and engaging with the Pakistan-backed Taliban — Russia is challenging India's core interests," said Chellaney.

India continues to officially maintain that it doesn't see any "downward trend" in relations with Russia even as it works behind the scenes to convince Moscow that Pakistan remained the fountainhead of terrorism in the region. For India though, Russia further queered the situation in Afghanistan by declaring that it regarded Afghan Taliban as a national military-political movement. Russia is looking to engage the Taliban apparently to defeat IS but, as the MEA spokesperson warned last week, India wants any engagement with Taliban to respect the internationally recognized red lines, including giving up violence and severing ties with al-Qaida.
The comments made by Dedov are only the latest in a series of Russian doublespeak on Pakistan this year. As it officially conveyed to Moscow, India was disturbed by Russia's decision to hold its first ever joint military exercise with Pakistan days after Uri terror strike which left 19 Indian soldiers dead. The Russians justified it by saying that the exercise was meant to help Pakistan deal with terrorism

At the Brics Goa summit in October, Russia chose not to help India publicly name Pakistan based terrorist outfits like Lashkar and Jaish in the official declaration in the face of Chinese resistance.
Russia continues to insist that its ties with Pakistan will not come at India's cost. Asked about the Russia-Pakistan military exercise though, at the recent Heart of Asia conference, Russia's presidential envoy to Pakistan Zamir Kabulov said Moscow didn't complain about India's close cooperation with the US and so India also shouldn't complain about "much low level" of cooperation between Russia and Pakistan. India may or may not complain, but it's certainly watching with eyes wide open.

Comment by Riaz Haq on December 19, 2016 at 7:00am

#Pakistan #Railway track upgrade to include overpasses, underpasses & grade separation for high-speed trains #CPEC https://www.geo.tv/latest/124093-Railway-tracks-to-be-made-gate-fre... …

LAHORE: Railway tracks from Karachi to Peshawar will be made gate-free and signal-free under the next phase of the China-Pakistan Economic Corridor (CPEC), Geo News reported, citing sources.

A fence would be built around the tracks, similar to Motorway, and an underpass or overheard bridge would be built at every gate on the tracks, the sources said.

Work on the project would be initiated from January. The first phase of the project would focus on railway tracks between Rawalpindi and Peshawar.

The signaling system in Pakistan Railways will also be upgraded under the project.

According to the sources, the purpose behind making railway tracks gate-free and signal-free is to make train journeys safer and faster for the public. The fencing and bridges would also lead to a reduction in accidents.

Once the project is completed, the tracks would be able to accommodate high-speed trains. The railways authorities have completed the planning for the project, the sources added. 

Comment by Riaz Haq on December 19, 2016 at 9:59pm

#China to set up large steel plant at #Gwadar, #Pakistan: Chinese Envoy. #CPEC http://www.app.com.pk/china-to-set-up-large-steel-factory-at-gwadar... … via @Associate Press Of Pakistan

Acting Chinese Ambassador to Pakistan, Zhao Lijian Monday said that his country would set up a large steel factory at Gwadar to further expedite economic developments being carried out under China-Pakistan Economic Corridor (CPEC) framework.
“Both China and Pakistan would very soon sign an agreement to establish the steel factory, three times bigger than the free economic zone being set up in Gwadar city,” he made this announcement while addressing participants of a day-long conference on CPEC: Potential and Prospects organized by Strategic Vision Institute (SVI) here.
He said, industrial cooperation was the forth pillar of CPEC initiative and both the country would discuss it in the next meeting of Joint Cooperation Committee (JCC) of CPEC to be held in Beijing this month.
“After completion of energy projects, transport infrastructure and development of Gwadar Port, industrial cooperation between China and Pakistan will be the main topic at the next JCC,” he added.
Zhao Lijian informed that China was working a lot for the development of Gwadar Port which was built with the Chinese government’s assistance.
He said, after completion, the port was handed over to Singapore but there was no improvement even after passage of five years.
Finally, it was given to the Chinese government by Pakistan government and the port was made functional and a ship carrying Chinese goods left for Africa.
He said, a business centre, hostel for different companies, fisheries processing plant with cold storage facility had been established in the free economic zone spread over around nine kilometers.
About Gwadar airport up-gradation, he said, the new international airport would have landing facility for all the modern aircraft including A-380 Airbus after completion, adding, prior to the up-gradation only C-130 or propeller-planes could land at the old airport.
The Acting Chinese Ambassador said, a 150-bed hospital was being built for the treatment of local people while a vocational institute had been set up for imparting training of different skills especially for the fishermen.
Talking about different energy project being completed under CPEC initiative in different parts of Pakistan, he particularly mentioned about the coal-based power plants which were being built in accordance with environmental standard set by the World Bank (WB) and other concerned international organizations.
He said, China produces around 60 percent of its total power generation through coal based power stations using modern and state of the art technology.
“The environmental concerns will be taken into consideration during the completion of these power stations,” he added.
Zhao Lijian pointed out hydro power plant, coal based power plants, wind power plants and solar based power plants were being set up to meet the electricity shortage in Pakistan.
He informed that the Karot Power Plant was being financed by the Silk Bank established by the Chinese government.
The groundbraking of Suki Kinari, Kohala Hydro Power Project would be held early next year, he said and added, Sahiwal Power Plant and Port Qasim Power Plant would be completed by next June and December respectively.
He said, a power plant set up at Thar coal site would also be inaugurated in next June.
He said, HUBCO power plant, one of the biggest coal-based power plant, would provide constant and stable power supply throughout the year. 

Comment by Riaz Haq on December 19, 2016 at 10:00pm

#China to set up large steel plant at #Gwadar, #Pakistan: Chinese Envoy. #CPEC http://www.app.com.pk/china-to-set-up-large-steel-factory-at-gwadar... … via @Associate Press Of Pakistan

The Acting Chinese Ambassador said, the 50MW wind power plants and the 100-MW solar power plant set up at Balochistan would boost the power production and hoped there would be no loadshedding in Pakistan after completion of all energy projects.
Giving overview of transport infrastructure projects, he said, the Multan-Sukkur section of Peshawar-Karachi motorway would be completed at a cost of US$ 2.8 billion.
He pointed out that no other country was ready to support this project because of being less populated and having less-transport.
China came forward to build this project on Built-Operate-Transfer (BOT) basis in three years.
He said, KKH Phase-II would be completed at a cost of US$ 1.3 billion, adding, its Phase-I had already been completed while Phase-III would soon be planned.
About railways upgradation, he said, after completion of dual tracks, speed of trains could be enhanced upto 160 km per hours.
Speaking on the occasion, Chairman, Parliamentary Committee on CPEC, Senator Mushahid Hussain Sayed said, the CPEC initiative would be beneficial for not only Pakistan and China but also the South Asia and regions beyond.
He said, at a time when nobody was coming forward to help Pakistan, China extended support and confidence to its time-tested friend.
He informed that the land route of CPEC would connect 65 countries through Pakistan’s Gwadar port.
He said, China’s cooperation in energy sector, transport infrastructure development including railways upgradation, Gwadar port, development of Thar coal, Karachi-Peshawar motorway, employment to 10,000 Pakistanis and early harvest projects under CPEC had given a new impetus to economic growth.
“These projects have not only pushed Pakistan economic revival but also help integrate different parts of our country,” he added.
Mushahid opined that importance of Shanghai Cooperation Organization (SCO) had increased manifold for regional cooperation and after India’s stubborn attitude regarding South Asian Association of Regional Cooperation (SAARC).
In his welcome address, President, SVI, Dr. Zafar Iqbal Cheema said that the CPEC was not only a game changer for South Asia but also for Central Asia and regions beyond.
He said, CPEC would have global implications over the time, adding, it would promote trade and economic activities in the entire region. 

Comment by Riaz Haq on March 1, 2017 at 8:29pm

#India must join #China #Pakistan One Belt, One Road #CPEC initiative to stay in the game via @htTweets

http://www.hindustantimes.com/columns/india-must-involve-itself-in-...

The recently held strategic dialogue between India and China provides a useful reality check on the state of the play. Over the past year, the relationship had reached an impasse owing to China’s unwillingness to support India’s entry into the Nuclear Suppliers’ Group and to allow Masood Azhar of Jaish-e-Mohammed to be placed on the United Nations Security Council’s terror list.

In both cases India had insisted that these were litmus tests of its ties with China. New Delhi’s stance stemmed from an under-estimation of the growing importance of Pakistan to China and from an over-estimation of its own clout. If the former underscored the inability of the government to get the measure of China-Pakistan convergence, the latter flowed from the curious belief that international influence was mostly about talking ourselves up.

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The prospect of a trade war sparked off by Trump’s imposition of tariffs is surely a major cause for concern to the Chinese leadership. But they also know that United States does not hold all the chips. For one thing, China can retaliate against American exports on a range of things from aircraft to soya bean. More importantly, American tariffs will undercut global value chains and the accompanying deep integration of regulatory systems — commercial laws, taxation, intellectual property rights — fostered assiduously by the US in the past.

While this will hurt China in the short run, it also provided Beijing an opening to reorient economic integration in Asia under its leadership and on more congenial terms.

The collapse of the Trans-Pacific Partnership and the rolling out of the One Belt, One Road (OBOR) initiative have already provided Beijing the perfect setting in which to pursue a more ambitious agenda of Asian connectivity and integration. Chinese economists have also mooted ideas to channel a greater portion of Asian savings into investments in Asia — instead of persisting with the current pattern of effectively sending those savings to the US and allowing American banks and financial institutions to reinvest them in Asia. All this will take time and enormous effort, but the Chinese are well poised.

Politically, too, Beijing will stand to gain from Trump’s attitude towards longstanding partners in Asia. If an ally like Australia — which stood by the US even during the Vietnam War — came in for rough treatment, what are the odds that others are going to have smooth relationship with the Trump administration? To be sure, many of these countries will continue to be concerned about China but the emergence of countervailing coalitions may become difficult.

Unlike Beijing, New Delhi does not have many cards to play. Despite repeated expressions of interest, India’s record in fostering economic integration even in the subcontinent is underwhelming. Further, New Delhi has firmly refused to sign up to the Chinese OBOR initiative. The two sides did, however, discuss the possibility of cooperating on developmental activities in Afghanistan. Again, while this is welcome, New Delhi should recognise that Beijing does not really need to work with it in Afghanistan.

Comment by Riaz Haq on March 18, 2017 at 5:19pm

#UN Security Council Endorses #CPEC (#Pakistan) and #China's #OBOR projects. #India unhappy. # via @htTweets

http://www.hindustantimes.com/world-news/un-security-council-resolu...


A UN Security Council resolution has for the first time incorporated China’s Belt and Road Initiative (BRI), a multi-billion inter-continental connectivity mission that has a flagship project passing through Pakistan occupied Kashmir (PoK).

The resolution, which extends an ongoing UN assistance mission to Afghanistan, says international efforts should be strengthened to implement the BRI, President Xi Jinping’s legacy project about which he first spoke in 2013.

Beijing claims it has rounded up at least 100 countries in BRI’s support, including Pakistan, Bangladesh and Sri Lanka.

India is yet to sign up for the initiative. Foreign secretary S Jaishankar spelt it out to the Chinese government in February that India has a “sovereignty” issue with the BRI because its flagship project, the China-Pakistan Economic Corridor (CPEC), passes through PoK. According to diplomats, India endorsing the BRI would mean giving up its claims on PoK.

The UN endorsing the BRI could complicate the situation as far as India’s claims are concerned.

The resolution in question renewed the mandate of the UN Assistance Mission in Afghanistan for one year. In it, the 15-nation UN body urged to promote security and stability in Afghanistan and the region “to create a community of shared future for mankind”.

“Also included in the newly adopted council resolution was China’s Belt and Road Initiative, which aims to build a trade and infrastructure network connecting Asia with Europe and Africa along the ancient trade routes,” official news agency Xinhua reported.

The resolution “welcomes and urges further efforts to strengthen the process of regional economic cooperation, including measures to facilitate regional connectivity, trade and transit, including through regional development initiatives such as the Silk Road Economic Belt and the 21st-Century Maritime Silk Road (the Belt and Road) Initiative”.

The council resolution urged “further international efforts to strengthen regional cooperation and implement the Belt and Road Initiative”.

Besides the BRI, the resolution also mentions other projects like “regional development projects, such as the Turkmenistan-Afghanistan-Pakistan-India gas pipeline project, the Central Asia South Asia Electricity Transmission and Trade Project, the Chabahar port project agreed between Afghanistan, India and the Islamic Republic of lran”.

China has taken the inclusion of BRI in a UN resolution as a diplomatic victory of sorts.

Comment by Riaz Haq on March 20, 2017 at 7:19am

A caitionary tale of #Pakistan's trade with #Kyrgyzystan in #CentralAsia. #Karachi #Bishkek #China #Afghanistan https://www.geo.tv/latest/134951-From-Karachi-to-Kyrgyz-a-made-in-P...

What connection does Naryn, a remote sparsely-populated mountain town in the Kyrgyz Republic, have with Karachi?

Located at a five-hour drive from the capital Bishkek, the sleepy town with a population of under 35,000, looks nothing like Pakistan. Other than the recently inaugurated campus of the University of Central Asia, even Google won't give you anything special about Naryn.

But Karachi-born Syed Mahir Shehzad has left his mark on the picturesque Central Asian mountain town.

From classrooms to the library, student dormitories to faculty and staff residences, Shehzad's Karachi-based office décor company has supplied every piece of high-end furniture at the 13,927 square metre UCA campus—almost all of it made in Pakistan.

"It was challenging for us not just in the sense that we had to compete with leading European companies, we—or pretty much any furniture company in Pakistan—had never exported to Kyrgyzstan," says the 36-year-old owner of Dimensions, which manufactures and assembles state-of-the-art modern office furniture competing with some of the leading brands in the world.

"We sourced some of our material from China, Malaysia and Indonesia, but a majority of it was assembled and manufactured in Pakistan, which we then mostly exported via trucks through the Pak-China border at Sust and then onwards to Naryn."

Owing to vast amounts of natural resources underexploited during the Soviet era, the five CACs –Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan – make Central Asia a US$339-billion, 68 million-strong economy with varying levels of purchasing power and a largely untapped market.

But trade with Central Asian countries amounts to only a fraction of Pakistan’s dwindling exports, recorded at $26 billion in 2015.

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Because of the uncertain security situation, Shehzad chose not to take the Pak-Afghan route.

"When we first got the project last year, we had no idea how we would export our goods to Kyrgyzstan. These are countries that we had never even thought of visiting, let alone export to. We faced a lot of trouble in even finding a logistics company that could transport our goods there," says Shehzad.

While Central Asia is becoming an increasingly important region, connecting Europe to South and West Asia, it can also be a challenging region for many new-to-the-market traders and investors.

Customs clearance in Central Asia is often said to be overburdened, with bureaucratic obstacles, arbitrary seizures of goods, excessive documentation, and a lack of proper protocols leading to significant delays.

With little support or guidance from the government authorities, Pakistani exporters face the same hurdles in reaching this largely untapped virgin territory.

"There was a lot of documentation. Our first containers got stuck in China shortly after crossing the Sust border. With only weeks to go for the launch of the campus, I had to wait for almost three weeks in Bishkek to face the nervous clients, before our transporter somehow managed to clear the trucks and bring them to Kyrgyzstan," says Shehzad.

Fortunately, after the first consignment, Shehzad says it took only five days for the rest of the trucks to reach Naryn from Karachi. "We were just ecstatic when the first trucks finally reached. From there on, it was just a matter of time. Even our clients were extremely proud."

The strategic Central Asia region can be a key market for Pakistani products, with lower labour costs in Pakistan giving the country a competitive advantage over European manufacturers

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