An Analysis of Terrorism, Geography, Diplomacy, and Economics
Chinese trucks along Pakistan’s Karakoram Highway (Wikimedia Commons)
My last two articles focused more intently on China’s naval strategy. Today I’ll be taking a look at overland strategy—specifically, the Belt and Road Initiative in Pakistan.
The Belt and Road Initiative, a series of overland and maritime routes designed to enhance China’s global influence and energy security, remains under development but still far from completion. This article examines the factors that have influenced BRI economic corridor development within Pakistan, China’s “flagship corridor” and the site of many important Chinese strategic and energy enterprises. While Pakistan is home to a large number of both active and “provisional” terrorist groups, I find that insurgencies and terrorist movements across Pakistan have not appreciably hindered the BRI’s progress as of 2020. Rather, CPEC projects have stalled in certain areas for a variety of economic, political, and geographic reasons. This article concludes with a look at CPEC’s precarious future and the overall trajectory of the BRI into the 2020s.
“Black Gold” and the BRI
As the expansion of the Chinese middle class drives an increasing demand for oil, China seeks to tap global energy markets at an unprecedented rate. The PRC’s quest for energy security carries important implications for Chinese foreign relations, and by extension American strategic calculations in the Middle East and Central Asia. For decades, China has centered its strategy around the “Malacca dilemma”—the fact that over 50% of China’s imported oil needs to pass through the straits of Malacca, a chokepoint that a foreign power could theoretically blockade in the event of a major geopolitical conflict. (Other analysts have argued that as much as 70-80% of African and Middle Eastern oil would need to pass through the straits en route to China.) American analysis reveals similar vulnerabilities in East Asian shipping routes. As Sean Mirski argues, China’s hypothetical adversary (read: the United States) could easily blockade China’s overseas shipping routes using a concentric-ring barrier of warships capable of thwarting China’s A2AD defense systems.
Knowing this, how will China decrease its reliance on vulnerable naval chokepoints? The answer lies in Chinese president Xi Jinping’s Belt and Road Initiative (BRI), also known as “One Belt, One Road” (OBOR). Hailed as a “modern Silk Road,” the BRI aims to build six economic corridors— comprised of roads, oil pipelines, and “belts” of soft power-based economic cooperation—across Central Asia and into Europe. The BRI, Chinese planners reason, could reduce reliance on the Strait and ensure the flow of “black gold” in the event of a blockade. While a Chinese “string of pearls”—a series of naval bases across the Middle East and Indian Ocean region—could do a great deal to advance Chinese strategic aims, overland routes could prove equally or more important in a war.
Sinologists and security studies experts alike have described the BRI as something of an enigma—difficult to define, and even more difficult to map. As one author put it, “There is no agreed-upon definition for what qualifies as a BRI project…The BRI banner hangs over a wide and ever-expanding list of activities. There are BRI fashion shows, concerts, and art exhibits. By design, the BRI is more a loose brand than a program with strict criteria.”
CSIS finds that while China intends to build a series of pipelines, maritime corridors and land corridors across Central Asia and even into Europe, it is difficult to measure their progress to date. Using a series of regressions, CSIS scholars found that “for five of the six” intended economic corridors designated as part of the BRI, “there appears to be no significant relationship between corridor participation and project activity.” In other words, the BRI has made progress—already a difficult metric to quantify—at a slower rate than expected.
Interestingly, only one of the six economic corridors—the China-Pakistan Economic Corridor (CPEC)—has shown “higher levels of project activity” that correspond with Beijing’s goals. As the most developed of the BRI’s six economic corridors, CPEC merits further study because of its potential impact on China and its implications for South Asian and Middle Eastern security. In many ways, Pakistan serves as the wheel upon which all Central Asian geopolitical interactions must turn. As one CSIS study puts it, “Pakistan’s emergence at the vanguard of the BRI makes it a focal point for examining the strategic implications of China’s accelerating rise. As the United States draws closer to India and China invests more deeply in Pakistan, the risk increases that the India-Pakistan conflict will prove a flashpoint for US-China competition, or even future confrontation.”
Noted geographer and strategist Halford Mackinder argued that Central Asia comprises the “pivot region” of the world. Given Pakistan’s unique geopolitics, one could in theory characterize Pakistan as the pivot of the pivot region. For this reason, and because CPEC stands out as the BRI’s most “successful” corridor to date, this article will focus on the factors that promote CPEC’s expansion across Pakistan’s provinces and territories.
Map of the Belt and Road Initiative (Wikimedia Commons)
Zeroing in on Pakistan
What factors set CPEC apart from the other BRI economic corridors? CSIS points out that, unlike all other BRI corridors, CPEC completes its link from China by means of only one other country. This obviates China’s need to engage with several countries’ “customs processes, procurement regulations, convoluted land rights, and other challenges to navigate”—complications that slow progress within the other five corridors.
China and Pakistan’s mutually beneficial relationship has also smoothed CPEC’s path. China and Pakistan have enjoyed strong relations in the past: both states trade freely with one another, and Pakistan has historically served as a mediator between China and other states (including the US, which worked with Pakistan to bring Nixon to Beijing for his historic visit). China’s relationships with other BRI partner states do not benefit from the same illustrious history. Finally, Pakistan stands to gain a great deal from CPEC’s expansion, even taking the spectre of Chinese “debt diplomacy” into account. Xi Jinping signed an agreement in 2015, for instance, to invest $46 billion in Pakistan (“considerably more than all the aid Pakistan has received from the US since 9/11”). Other BRI countries have seen similarly high levels of investment, however—what is unique about Pakistan’s circumstances?
To return to Mackinder, the answer lies largely in geopolitics. Pakistan’s geopolitical situation at the crossroads of India, Afghanistan and the Middle East puts it in a position uniquely precarious enough to incentivize cooperation with China at almost any cost. Because Pakistan is surrounded by larger, wealthier adversaries and dogged by numerous ongoing insurgencies within its own borders, it is arguably the BRI’s most beleaguered partner state. As a result, Pakistan stands to benefit the most from the wealth and stability that Chinese investment could bring. This provides Pakistan’s strategists with a strong incentive to cooperate with China even at terms that may seem unfavorable.
Karakoram Highway, a key CPEC route (Wikimedia Commons)
What Factors Influence CPEC’s Progress by Region?
CSIS finds that CPEC’s progress by province does not correlate with human development index. HDI, broadly speaking, accounts for economic factors as well as human capital and quality of life assessments. Separating Pakistan into seven zones, CSIS created this table comparing HDI with CPEC’s completion rate:
CSIS attempts to explain the data as a matter of funding. Certain projects in certain zones have simply received more funding than others:
“Announced project funding (excluding national and cross-border projects) is distributed roughly evenly across Pakistan’s provinces, with the exception of the most developed (AJK) and two least-developed provinces (Balochistan and FATA). This has played out in project completion rates as well, with the most and least developed provinces having no completed projects so far, and the moderately developed provinces of Punjab and Sindh approaching completion rates of 50 percent.”
CPEC’s complete lack of progress in Gilgit-Baltistan—the region of Pakistan that, according to Afzal and Naseem, could stand to benefit the most from Chinese investment after the placement of a fiber-optics cable—indicates that China likely makes the bulk of the financial decisions in the China-Pakistan relationship. Knowing this, what factors may be prompting China to fund projects in certain areas more generously than those in others?
The high levels of terrorism that Pakistan has experienced in certain regions, including direct attacks on Chinese nationals, might seem like the most obvious factor. South Asia Terrorism Portal (SATP) has created a comprehensive list of “proscribed,” “active,” and “inactive” groups of terrorists, insurgents, and extremists by province. According to SATP, Balochistan has five such “active” groups. KPK has two; AJK has only one; Punjab and Sindh each have two. Sindh and Punjab’s lower numbers of terrorist groups correspond with their higher levels of CPEC completion. The correlation does not hold up in all cases, though: AJK has fewer active terrorist groups than Balochistan, but Balochistan’s CPEC projects are closer to completion. Evidently, the number of active terrorist groups does not strongly correlate with CPEC completion rate by zone.
SATP further breaks down terrorism data by deaths per province, a variable with slightly greater explanatory power. The following table compares “zone-wide” civilian and security personnel deaths dating back to 2000. (Although BRI construction did not begin until 2013, Chinese perceptions of acts of terrorism in the preceding decade likely would have influenced construction decisions into 2013 and beyond. Furthermore, certain China-backed projects that began in Pakistan before the BRI existed, such as a proposed fiber-optics cable running through KPK, have been added to CPEC retroactively.) SATP did not account for CSIS’s “AJK” zone, so that region is left out of this table.
When number of deaths is accounted for, Punjab and Sindh show both fewer terrorism-related civilian and security force deaths and higher levels of CPEC completion. The correlation falls apart, however, when comparing FATA and KPK. KPK clearly has a higher number of terrorism-related deaths than FATA, but KPK’s CPEC projects have made greater progress. Furthermore, Balochistan and Sindh’s relative numbers of terrorism-related deaths are incredibly close, both within the 5000s range, but Balochistan shows a significantly higher CPEC completion rate.
The fact that numerous attacks in Pakistan have specifically targeted Chinese nationals further confirms that China’s BRI construction efforts are, so far, undeterred by the threat of terrorism. Members of the separatist group Balochistan Liberation Army (BLA) attacked the Chinese consulate in Karachi in 2018; according to the South China Morning Post, “Baloch separatists view Chinese investment in Balochistan as usurpation and exploitation of their resources.” More recently, BLA terrorists targeted a Chinese-built hotel in Gwadar (one of the locations at which, CSIS reports, BRI projects have reached completion) and killed five hotel staff. Pakistan’s government, fearful that China will grow skittish and pull out of its investments, has begun to provide greater security for CPEC projects. It has also begun to focus on a “hearts and minds” campaign in Balochistan, reasoning that economic security will lower BLA insurgents’ incentive to attack Chinese development projects.
The fact that Balochistan’s projects have proceeded in the face of BLA resistance points to two possible conclusions. One, terrorist attacks (even those against Chinese nationals or Chinese projects) are still too scattered or infrequent to cause China to reconsider its investment. Alternatively, China must have such a large economic or security incentive to continue development in that region that no amount of terrorism could deter CPEC’s progress.
With this in mind, if terrorism is not impeding CPEC’s expansion, what is? The data from CSIS and SATP point to several explanations. The progress of CPEC projects in Sindh and Punjab (45% and 47% completion, respectively) could probably be explained by a multitude of factors—lower levels of local resistance, along with simple geography. Sindh and Punjab are both “flat” regions compared to Pakistan’s other provinces. Pakistan’s northern provinces, which border Afghanistan, China, and a handful of former Soviet republics, are far more mountainous. Balochistan, too, is a large province but has many mountainous areas. Geography alone would make any building project in Sindh or Punjab, whether a road, oil pipeline, or power plant, much easier to build than a similar project in Pakistan’s northern territories.
CIA relief map of Pakistan, 2002 (Wikimedia Commons)
China’s relationship with India could be another factor complicating CPEC’s progress. As CSIS points out, “Two of the three provinces with no completed projects (excluding cross-border links), AJK and Gilgit Baltistan, are located in Pakistan-administered parts of the Kashmir region in dispute by India and do not have representation in Pakistan’s national parliament.” Pakistan’s comparatively lower levels of control over AJK and Gilgit Baltistan could be creating bureaucratic headaches for China, adding another layer of complexity to negotiations and driving China to push development in areas with less Indian influence. CSIS pointed out that CPEC’s progress compared with other BRI corridors stems largely from the fact that the Pakistani state is the only government involved. Perhaps AJK and Gilgit Baltistan are the exception, and India’s involvement in those regions has complicated China’s negotiations.
Finally, it is important to keep in mind that “completion” as defined by CSIS is only one way to assess the BRI’s progress. Some provinces have a much higher number of CPEC projects than others (a factor that, according to Azfal and Naseem, may be causing even more resentment towards CPEC in Balochistan). As Pakistan’s Express Tribune reported in 2016, Balochistan only received eight proposed projects out of 330 designated for CPEC. Punjab, by comparison, received 176. Naturally, completing only 25 percent of eight projects in Balochistan is much easier than reaching the same level of completion in a region with dozens of proposed projects. Future research into CPEC will need to take such factors into account, proposing alternate means of measuring the growth of the BRI over time.
What Lies Ahead for CPEC?
The BRI remains a work in progress fraught with numerous potential pitfalls. Bloomberg reports that into 2020, even BRI projects in “flagship” Pakistan have begun to stagnate. Even so, China’s perception that it is “playing catch-up” in the global energy market has led it to invest in partners even riskier than Pakistan. For this reason, it is possible to assume that China will willingly endure a number of costs in order to develop CPEC, not to mention its other five economic corridors.
Bloomberg reports that in the case of CPEC, China is likely its own worst enemy: “China is scaling back its ambitions, not just in Pakistan but around the world. Its economic growth has slowed to the lowest rate in three decades, inflation is rising and the country has been feeling the effects of a trade war with the U.S.” According to Bloomberg’s report, Kenya, Malaysia, and Sri Lanka have all halted or compromised BRI projects in some regard. Many countries remain wary of Chinese “debt diplomacy” or fear the political consequences of closer ties with China.
In the case of the China-Pakistan partnership, it seems that China is the partner with the most leverage. Pakistan’s precarious security situation and unstable economy give it a greater incentive to cooperate with China than some of its BRI counterparts. Even so, the coronavirus pandemic will likely take a devastating human and economic toll on BRI partner states in Central Asia. Pakistan has already failed to deliver billions of dollars for CPEC projects (the IMF had to bail it out last year), and an impending global recession could spell disaster for underfunded CPEC initiatives. Only time will tell if any of the six economic corridors reach completion and, if and when they do so, yield economic gains for China and its partner countries.