On 9 June 2017 Pakistan became a regular member of Shanghai Cooperation Organization (SCO). Pakistan’s membership of this Organization is going to be beneficial to itself and for all other member states of SCO in many ways including their connectivity and trade using CPEC. This Corridor has come at a very right time, when Pakistan has also become a permanent member of the SCO. With Pakistan being a member it will get easier for SCO members to become a part of the CPEC project by joining it during its construction phase through investments and its operational life by using it for trade by having an access to the warm waters of the Arabian Sea. These two timely happenings are likely to act as the fate changers in the context of adding to the economic development and prosperity of this part of the world, including South Asia, Central Asia, West Asia, China and Russia.
CPEC will benefit above mentioned regions and countries, especially SCO member states through the trade of goods and services, investments in these areas, transportation of energy through pipelines, sharing of technology and industrial development, spread of communication network, including access to the internet through high quality fibre optics, increase in employment opportunities, and enhancement in people to people contacts and tourism. While other regions and countries will also benefit from the CPEC, the maximum benefit in any case will be drawn by SCO member countries, since it will be easier for them to exploit CPEC related advantages due to mutual contacts at the SCO platform and the resultant ease of doing business with each other.
For trade purposes, all old SCO members, including China, Russia, Kazakhstan, Kryghistan, Uzbekistan, Turkmenistan and Tajikistan, would be able to carry out their trade with South Asian countries, ASEAN, the Middle East and North Africa and vice versa by using the CPEC. This will be the shortest and the cheapest route to and from the Arabian Sea. Till the time peace is established in Afghanistan, the Central Asian Republics (CARs) and Russia will be able to connect to the CPEC using the route defined by the Quadrilateral Traffic in Transit Agreement (QTTA), which is a transit trade deal between China, Pakistan, Kyrgyzstan and Kazakhstan for facilitating transit traffic and trade. From China the route can join the Karakoram High way to reach Pakistan. Recently, Tajikistan has also expressed interest in joining the deal.The initial work on this road project was initiated in 1995.The road project is related to the China, Pakistan Economic Corridor, which aims to provide China and Central Asia access to Pakistani ports. Using CPEC trade in services in this larger region will greatly help in enhancing employment opportunities for the people of the region.
When the trade of the CARs with the outer world will flourish, it will add to their growth rate and economic development. With more demand of their products, industrialization will multiply and foreign investors would be attracted to invest there. Industrialization will create jobs,
employment opportunities for the people, thus adding to their incomes and economic well being. Rising incomes will enhance the educational level of the masses and job security and economic well being of the CARs will act as a barrier to the extremist tendencies in the people thus helping in ending the root causes of terrorism in these areas.
The CARs have lots of energy resources (hydro electricity and gas) to export to the energy hungry countries of South Asia, especially Pakistan, Afghanistan and India. In this context, with Pakistan and India having become the regular members of the SCO, the prospects of the completion of Turkmenistan, Afghanistan, Pakistan and India (TAPI) gas pipeline and Central Asia South Asia (CASA) 1000 electricity line may become a reality. While the concerned Central Asia states will earn from the export of gas and electricity, energy demands in Pakistan and India will be met, which will have a substantial impact on the industrialization of these countries. By using CPEC, CARs and South Asia will become markets for each other and the same will happen between China, Russia and South Asian countries.
With the increase in the communication channels people to people contacts will multiply, thus improving trade and commercial activities in a major way. With the increase in trade and the industrialization, technology transfer will take place and all countries of the region will get an equal opportunity for their economic development. With increased incomes due to enhanced economic growth and development and wider and speedy communication networks and travelling facilities tourism in the region will also flourish. Thus the tourism industry of all the countries will flourish, which will be good for the happiness of the people and increased tourism will create further jobs for poorer sections of these areas and add to their economic well being.
In the final analysis, it can be concluded that development of the CPEC is going to make an inter regional Corridor, which will facilitate trade, travelling, sharing of industrial progress, cross regional investments, communications, people to people contacts, tourism, increase in economic growth and development and enhancement in the welfare of people of SCO member countries, Russia, China and the people of other regions that will use the CPEC for all these purposes. Thus a cycle of rising production, trade, employment and development in these regions and countries will add to the well being of their people and this process will help the realization of the Chinese dream of the shared destinies and development of China, its neighbours and other parts of the world, since all these activities in this area to be done using CPEC would create a feeling of brotherliness and it will bring a message of peace and prosperity.
Article originally published in Pakistan Observer on June 14, 2017.
Disclaimer: Views expressed are of the writer and are not necessarily reflective of IPRI policy.