Pakistan's High-Profile Gwadar Port Mired by Political Instability & Social Unrest

Gwadar Port is an essential part of the China-Pakistan Economic Corridor (CPEC), offering numerous strategic and economic benefits to both countries. Despite the initial momentum in 2015, the development of the port has been slow, and protests organized by local communities have only put further strain on it.

Spanning 1000 kilometers out to sea in the south of Pakistan, one finds two functioning ports, Karachi Port and Port Qasim. However, a third is in the making: Gwadar Port.

Located in the Balochistan province, Gwadar Port is a vital part - and some say the "crown jewel" - of the China-Pakistan Economic Corridor (CPEC), which was launched in 2013. The corridor, which covers billions of dollars in infrastructure projects and development initiatives, includes road networks and train linkages designed to connect China and Pakistan.

Strategic & Economic Benefits

Gwadar Port is owned and operated by a Chinese firm called China Overseas Port Holding Company (COPHC) and is designed to benefit Beijing's commercial, political, and military activity in the Indian Ocean, since it will greatly reduce the country's dependence on routes through the Sea of Malacca and South China Sea.

In this regard, Gwadar will provide China with an alternative and shorter route for energy imports from the Middle East, thereby reducing shipping costs and transit times.

The currently available sea route to China from the Middle East is about 12,000 kilometers long, while the distance from Middle East to Gwadar Port is just 700 kms. From Gwadar to the Xinjiang region it is approximately 3,000 kilometers. Energy imports will be shipped from the Middle East to Gwadar and from there transported overland through Pakistan into the Xinjiang region.

This will significantly improve Chinese trade routes in the region, as its imports and exports to the Middle East, Africa, and Europe will require much shorter shipment times and distances.

For Pakistan, Gwadar Port is seen as enhancing the country's overall trade turnover, since the country's trade occurs mostly by sea.

According to some analysts, Gwadar has the potential to acquire the status of a central port for many reasons. Firstly, it will be the closest port to China, as well as being adjacent to the Indian Ocean, the Strait of Hormuz, and the Persian Gulf. Hence, it can potentially compete with the UAE’s ports.

Other benefits of Gwadar for Pakistan include the multiple development processes in the port area and Balochistan province in general. The 300 MW coal-based power plant, planned to start operating in 2023, is one among many CPEC projects that will help locals in their daily lives.

Apart from this, the area is also seeing the construction of a Pak-China Friendship Hospital costing $100 million.

Furthermore, an international airport with world-class facilities and additional cargo handling capacity is also in the construction phase. These projects are just a few in the long list of potentially useful and mutually beneficial advances.

However, with such incredible opportunities, there have been a number of challenges that the mega project is facing.

Lack of Political & Economic Stability

Slow economic growth as well as political and social instability in Pakistan predate the CPEC. The mentioned issues have plagued the country for years, well before the construction of the Gwadar Port began.

Unfortunately, these issues are seeping into the CPEC projects. In April 2021, Pakistan's external debt rose to $90.12 billion, with Islamabad owing 27.4 %, or $24.7 billion, of its total external debt to China, according to the International Monetary Fund (IMF).

Despite that, China has refrained from directly influencing Pakistan’s economic policies. China has nevertheless provided financial and technical expertise to help Pakistan build its road infrastructure, expanding north-south connectivity within the country to improve the efficiency of moving goods from Karachi all the way to Gilgit-Baltistan in the northmost region.

However, despite all these efforts, Pakistan’s own shortcomings are worsening the debt crisis, which in turn slows CPEC projects because the budgets don't get cleared on time. These weaknesses can only be addressed by structural reforms in the country, but with the ongoing political instability, it is very hard to achieve any kind of economic stability.

The recent catastrophe with monsoon floods has further plunged Pakistan into economic turmoil, as the recovery from the devastation is estimated to cost the country around $20 billion.

Furthermore, a recent United Nations report estimated that Pakistan's powerful elite groups receive about $17.4 billion in economic privileges, including tax breaks and easy access to capital, which amounts to almost 6% of Pakistan’s GDP.

This sort of corruption is deep-rooted within the country and can only be eradicated by a strong political leader with a stable and loyal government.

All these unfavorable factors are hampering the CPEC projects and diminishing the Gwadar Port's potential.

Local Balochis Have Some Reservations

The local Balochis living in the areas close to the construction site of Gwadar Port, have also expressed their concerns regarding the mega project.

Some 250,000 people live in the vicinity and most struggle with access to basic necessities such as electricity and decent education for their children.

With the arrival of Chinese in the area, the main concern that the locals have raised during their protests is that the Chinese trawlers are depleting marine life.

Most of the local residents are fishermen who rely on catching fish for their livelihoods. Now allegedly, Chinese trawlers catch tons of fish and sail back to China, leaving locals with a depleted stock.

Local fishermen had previously already given up some of their regular fishing spots, due to development work on the port, which had also affected their livelihood.

So far, the promised vocational training center, a desalination plant, airport and a hospital in Gwadar have not been finished, further frustrating locals.

Some Balochis have also implied that the economic activity that China started in Gwadar has largely benefited Chinese firms and workers, but has not led to employment for the locals.

In the meantime, a fishers’ settlement called the Khulgari Ward, to the east of the Gwadar Port, made headlines when people protested against the construction of a highway that cut off settler's access to the sea.

The construction of the Eastbay Expressway, a major road connecting Gwadar to the main highway, is essential for the future trade route of the CPEC, but it took away the Khulgari community’s 2 kms of free access to the sea, and this had a negative impact on both their social and economic wellbeing.

Following the locals’ protests, the government agreed to built a jetty for them to make access to the sea possible.

Furthermore, much of the area in Gwadar has now been classified as a high-security zone, so it has become off-limits for fishermen and their families. For generations, these locals were the only people for miles, having the open seas all to themselves.

Although the locals are not completely against Chinese development, they feel excluded and ignored. That is resulting in a sense of hostility towards Beijing and the Pakistani government, because they feel that their voices are not being heard.

It is highly likely that once the Gwadar Port starts operating at its full potential, generating big profits and proper development and the promised economic growth takes place, local people will see that the ratio of benefits is higher than the costs.

Just last week, a Planning Commission Islamabad delegation headed by the Director General of Monitoring Saifur Rehman Usmani visited Gwadar and reviewed various development projects.

During the visit, Usmani said that the government is committed to building and developing Gwadar in view of the global importance of the port city.

Could it be that just some years from now, locals will live in a comfortable environment, having constant electricity, good education, hospitals and proper employment opportunities?

Only time will tell.

The views expressed in this column are those of the author and do not necessarily reflect the position of Sputnik.