Paper Silk route monitor A review of developments on China-Pakistan Economic Corridor

Safdar Sial and Peer Muhammad

 Safdar Hussain, nom de plume Safdar Sial, is Joint Director at PIPS and Associate Editor of Conflict and Peace Studies journal. He has also co-authored ‘Dynamics of Taliban Insurgency in FATA’ and ‘Radicalization in Pakistan’. Peer Muhammad is a reporter with The Express Tribune, covering issues related to political economy of the country.

uring Chinese President’s visit Secondly, it will open up trade routes D to Pakistan in April this year, for China and Pakistan to Middle both countries signed several East and Central Asia. Thirdly, the agreements including those linked to corridor could also improve China-Pakistan Economic Corridor prospects for regional economic (CPEC). CPEC is one component, interdependence as well as for peace albeit a major one, of an investment and stability. understanding between the two countries, worth of $45 billion. For Pakistan, two key imperatives or According to preliminary compulsions of the emerging understanding, Chinese banks and regional dynamics in that context are companies will provide soft loans to work for establishing friendly and grants to Pakistan to develop its relations with its neighbours and infrastructures and undertake energy achieving security and stability in the and communication projects, along country and wider region. the corridor’s track.1 It is proposed that around a dozen industrial zones Pakistan’s refusal to send its troops to will be set up from Khunjerab in the Yemen, which would have annoyed north to Gwadar in the south. The a neighbour Iran, and efforts to government anticipates creation of contribute towards political economic opportunities in the next reconciliation in Afghanistan can be four to five years, besides alleviating seen as major steps towards Pakistan’s energy woes. achieving fulfilling the first imperative. With regard to the Political and strategic analysts are second imperative, the country has describing CPEC as a game changer been actively engaged in countering for Pakistan and wider region in terrorism, particularly since July last many ways. First, the corridor will year when the military operation significantly contribute towards Zarb-e-Azb was launched. The action Pakistan’s social and economic gained an impetus after the development. Besides establishing December 2014 terrorist attack on an huge road and rail infrastructure, the army-run school in Peshawar. CPEC projects will also address Pakistan has taken some CPEC- Pakistan’s lingering power crisis.

1Dawn, Islamabad, May 1, 2015.

Paper specific measures as well, which will also tries to assess government’s be described later. efforts to address those challenges and to ensure the implementation of This report reviews recent CPEC- the CPEC projects according to linked developments, mainly on stipulated timeframe. political, security, socio-cultural and developmental fronts. Apart from discussing key challenges, the report Figure 1: A sketch of CPEC projects (Source: Express Tribune, May 27, 2015)

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1. Political response towards pass through many parts of CPEC Balochistan and Khyber Pakhtunkhwa, apparently with a Even before the visit of Chinese view to benefit Punjab. President to Pakistan in April and  As the new route is largely both countries’ signing of aligned in Punjab, the CPEC- agreements related to China- linked industrial zones will also Pakistan Economic Corridor, the be established in Punjab project had generated controversy in Pakistan, with political leaders discriminating other provinces. particularly of smaller provinces  Federal government only invited alleging that the original route of the Punjab Chief Minister Shahbaz corridor has been altered to benefit Sharif, younger brother of prime Punjab. Pakistan Muslim League- minister, in the meetings and Nawaz (PML-N), which currently visits related to CPEC, and rules at the centre and in Punjab, was strongly criticized, particularly by ignored other chief ministers. political leaders and parties of  As security is also a Khyber Pakhtunkhwa and responsibility of provinces, Balochistan. Some of the general federal government did not allegations put on the PML-N discuss with provinces about government and also perceptions how to ensure security of the about the CPEC were as under: CPEC projects and Chinese and  Manifesting a secretive local workers. approach, the government does It was against this backdrop that the not seem willing to share its federal government tried to reach out plans and policies on the CPEC to political parties in and outside with governments and political parliament to address their concerns leaderships of other provinces and evolve a consensus on the CPEC except Punjab. As a result, the project. Apart from holding government has failed to individual consultations with properly communicate with representatives of political parties smaller provinces and take them and issuing repeated statements, the into confidence on the project. government also held two all-party  The government has changed the conferences (APCs). During the original (western) route of the second APC held on May 28, all corridor, which was designed to

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Paper political parties gave a go-ahead to  “The third (eastern) route will the CPEC project. While it was include Gwadar, Basima, decided in the first APC to establish a Khuzdar, Sukkur, Rahimyar parliamentary committee to oversee Khan, Bahawalpur, Multan and the progress on CPEC projects, it was Lahore/Faisalabad and then decided in the second that western reach Islamabad.” route that passes through main areas of Balochistan and Khyber According to details revealed on Pakhtunkhwa provinces will be Planning Commission’s website, all constructed first. provincial capitals are included in the CPEC as nodes. These nodes, which On repeated requests by political are the key cornerstones on which the parties to explain the planned routes corridor will be constructed, are at of the CPEC, Federal Minister for Peshawar, Islamabad, Lahore, Planning, National Reforms and Sukkar, Karachi, Gwadar and Development Ahsan Iqbal described Quetta.2 the three routes as following:1 As mentioned earlier, almost all  “The western route originating parties expressed their satisfaction on from Gwadar will pass through government’s stance on the CPEC in Turbat, Panjgur, Nag, Basima, the May 28 all-party conference. It Sorab, Kalat, Quetta, Qilla was indeed a big achievement. One Saifullah and Zhob and reach can only hope that that political Dera Ismail Khan before leading consensus is not short-lived. There to Islamabad.” are however certain factors that will influence and determine political  “The second (central) route will response of parties and provinces originate from Gwadar and reach towards the CPEC in future. These Dera Ismail Khan via Basima, factors are described below: Khuzdar, Sukkur, Rajanpur, Layyah, Muzaffargarh and i. Implementation of the projects Bhakkar.” on the three CPEC routes will

1 “Ahsan reveals three routes of development – not lines of divide,” corridor,” Dawn, Islamabad, May 15, Express Tribune, Islamabad, May 18, 2015. 2015. 2 Shahbaz Rana, “China-Pakistan Economic Corridor: Lines of

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determine whether or not all security, politics, and political provinces are satisfied with the economy or NFC awards,4 could corridor progress. If political also impact the future of political parties and leaders from small consensus achieved on the provinces feel that budgetary CPEC. At the moment, allocations and implementation significant political tensions exist are more oriented towards the between federal government and eastern route and that other two main political parties of routes are being ignored, they Sindh, i.e. Muttahida Qaumi could again start protesting. Movement (MQM) and Pakistan People’s Party (PPP). Pakistan ii. It will also be important to see Tehrik-i-Insaaf (PTI) that rules in how the announced Khyber Pakhtunkhwa is the parliamentary committee for the main rival party of the PML-N CPEC oversight is established ruling at centre and in Punjab. and functions. Analysts Although the provincial described the agreement as a government of Balochistan is positive move and noted that if currently at good terms with the the proposed committee PML-N-led federal government, becomes an active forum, it will but the province’s relationship certainly help address the with Islamabad and security concerns of all the provinces and establishment has always political parties. Nonetheless, remained uneasy. A feeling some feared that “a non- among Balochistan’s functional oversight committee government and political parties will also be detrimental for that Gwadar and CPEC projects policy and the execution are not benefitting their province sustainability of the CPEC and Baloch people, could put project.”3 those parties in opposition to these projects. If that happens, it iii. Federal government’s relations will also strengthen Baloch with provinces, mainly those linked to aspects of internal

3 Muhammad Amir Rana, “Economic 4 As per Constitution, NFC awards corridor challenges,” Dawn, Islamabad, formulate financial formulas of economic May 17, 2015. distribution to provincial and federal government for five consecutive years.

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insurgents’ anti-mega projects smooth implementation of stance. CPEC. Pakistani army is extensively engaged in iv. Political culture in Pakistan has counterterrorism operations and not yet matured, which could needs civilian support for that. create a crisis in the country at After the announcement of any point of time. In recent times, National Action Plan (NAP), we have seen episodes of military’s role in internal security political immaturity creating a policy has increased. Military is political turmoil. Political also concerned about what it says protests and sit-ins organized by ‘political problems’ hindering the PTI and a religious cleric the implementation of NAP. Tahirul Qadri against the Nonetheless, there is a growing government in Islamabad during perception in Sindh and last year are one example of that. Balochistan that military is Also, a culture of political overstepping its constitutional intolerance is growing in role and interfering in matters of Pakistan as it was evident in civilian administrations there. Khyber Pakhtunkhwa’s local government elections held on May 30, 2015. The elections Following pages describe political entailed a string of incidents of reactions of different political parties political violence among towards the China-Pakistan members and workers of Economic Corridor expressed in political parties contesting these recent months, and how the federal elections. As many as 12 government addressed their incidents of political and concerns and created an environment election-related violence claimed of political agreement on the CPEC 22 lives and injured 68 others, project. just in three days.5 1.1 Khyber Pakhtunkhwa v. Finally, civil-military relations will also account for sustained Khyber Pakhtunkhwa-based political political stability in the country, parties vociferously opposed the which is fundamental for the project’s proposed route through

5 Statistics are based on Pak Institute for Peace Studies’ database on security.

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Silk route monitor: a review of developments on CPEC eastern Pakistan, arguing that the prosperity or destruction?”7 Later, he original route was meant to pass argued that the federal government through the western part of the was trying to include Lahore, country, from Balochistan and KP. Punjab’s capital, in the CPEC: The Awami National Party (ANP) “Lahore was not part of the original and the Qaumi Wattan Party (QWP) corridor project, but the federal in particular expressed their government is making way to reservation on what they thought include it in the project at the cost of was alteration in the route. militancy-stricken KP and Balochistan.”8 The ANP was on the forefront and even went to the extent of saying that Meanwhile, an ANP delegation, led it will protest against a change in the by Mian Iftikhar, had a detailed CPEC route like it has been meeting with political leaders in protesting against Kalabagh Dam. Balochistan, warning that should the The party head said he was ready to route change, the federal government be better tagged as a ‘traitor’ than will bear responsibility for any compromise on the rights of his unrest.9 people. The party believed, at least until its concerns were addressed by ANP leaders believed that the PPP, the government, that PML-N leading opposition party, was also government wanted to give toeing the government’s line on the maximum benefit of CPEC to Punjab. project. By changing the route to the “Punjab is political constituency of eastern side, the dividends will be PML-N. The party is in minority in felt in Sindh, PPP’s bastion, they other provinces. That is why it wants argued. CPEC to benefit most Punjab,” ANP leaders were quoted by media as Similarly, Jamiat Ulema-e-Islam-Fazl saying.6 (JUI-F) chief Fazlur Rehman frequently issued statements against Addressing a multi-party conference, the alleged change in the route and against the alteration in the route, in said the government was responsible Quetta, ANP’s chief Asfandyar Wali for making the CPEC controversial. Khan said, “The problem is in Islamabad. When Pashtun and Pakistan Tehrik-i-Insaaf (PTI) of Baloch prosper, is that Pakistan’s Imran Khan, which rules in Khyber

6 BBC Urdu, April 20, 2015, 8Dawn, May 24, 2015, http://www.bbc.com/urdu/pakistan/2 http://www.dawn.com/news/1183913 015/04/150420_ahsan_china_agreement /inclusion-of-lahore-in-corridor-route- _sq?ocid=socialflow_facebook. to-be-resisted-asfandyar. 7Express Tribune, Islamabad, May 16, 9Dawn, Islamabad, May 1, 2015. 2015.

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Pakhtunkhwa, also protested against PTI chief Imran Khan said while a change in the CPEC route. KP Chief addressing journalists at the Minister Pervez Khattak said in a inauguration ceremony of a girls’ press conference on April 22: “We school in Peshawar on May 26 that will launch a legal as well as political changes in the route would weaken battle if the federal government the federation as less developed changed the original route of the regions of the country would be left PCEC.”10 He asked the federal behind. “Changes in the corridor are government to share details of the likely to stoke hatred of Punjab in agreements and MoUs signed with other provinces,” he argued.13 Imran China. Mr Khattak said KP had huge Khan also said on May 15 that potential for hydel power generation, Gwadar-China [original] route of the but the federal government preferred CPEC should be constructed first, as coal, wind or solar energy in the it is the shortest and would help CPEC’s power projects. He reduce economic burden on big complained that projects worth $11 cities.14 billion would be set up in Punjab, and KP would get only $2.7bn Nationalist elements in KP also projects, while it deserved three resisted the alleged change in the times more. He also expressed CPEC route. A conference was serious reservations over the organized in that regard by presence everywhere of the prime Pakhtunkhwa Ulasi Tehreek in minister’s brother and Punjab Chief Peshawar press club on April 12. Minister Shahbaz Sharif during the Representatives of political parties visit of the Chinese president.11 (mainly ANP, PTI, and QWP) and activists of civil society and trade A PTI leader Asad Umar noted that bodies participated. Participants took the government intended to carry out serious notice of the federal power generation projects under the government’s proposed plan to CPEC in KP, but the head of the divert the CPEC route and provincial energy board was not constituted a committee to take up invited to any of the many meetings the issue with Senate chairman and held far that.12 Chinese government.15 The Ulasi Tehreek also organized a seminar in

10 Zulfiqar Ali, “KP warns of protests if 13Express Tribune, Islamabad, May 27, Pak-China corridor route changes,” 2015. Dawn, Islamabad, April 23, 2015. 14Express Tribune, Islamabad, May 15, 11 Ibid. 2015. 12 Khawar Ghumman, “Parliament 15“Any change in Economic Corridor watch: Is better PR the solution to PML- route opposed,” The News, Islamabad, N’s corridor problems?," Dawn, May 15, April 3, 2015. 2015.

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DI Khan titled “Kashgar-Gwadar Balochistan CM also said on May 3 Economic Corridor” on April 19. that he was not taken into confidence Representatives of different political by anyone with regards to CPEC and parties participated and vowed to he was not aware of the CPEC oppose the CPEC if government did route(s).18 He reiterated his stance not abandon the plan to change the while addressing a press conference route of the project.16 in Lahore on May 17: “The CPEC is not just a route… it has multiple 1.2 Balochistan aspects. It includes the Gwadar port, roads, railway tracks, energy projects Balochistan is the least developed and industrialization (along the province of Pakistan. Many claim corridor) and it should be ensured 19 that if the CPEC and Gwadar port that Baloch people benefit from it.” projects ignore Baloch people and the development of the province, it On April 21, lawmakers in the would be difficult to counter the Balochistan Assembly denounced appeal of Baloch insurgent ‘modifications in the Gwadar- movements that propagate that Kashgar route’ and threatened to federal government wants to capture hold indefinite protest sit-in in Balochistan’s resources. Islamabad if federal government’s ‘biased policy’ continued to ignore 20 This concern was frequently raised Balochistan in the CPEC project. The by Balochistan’s Chief Minister original route, they claimed, passed Abdul Malik Baloch. “Whether it is through major parts of Balochistan Gwadar port or CPEC roads, it is including Khuzdar, Quetta and essential that the people of Zhob. Lawmakers however noted Balochistan first benefit from these that the CPEC is a positive projects. If that does not happen, development but “presence of people of Balochistan will not Punjab CM in functions gave an support Gwadar and CPEC-related impression that agreements were development projects,” he said in an being signed between Lahore and interview with BBC Urdu.17 Beijing and not federation of Pakistan and China.” They said that Balochistan government was not

16The News, Islamabad, April 20, 2015. 19 Meeran Khan, “Reconciliation plan sent 17 BBC Urdu, April 20, 2015, to Centre: Dr Malik,” The News, http://www.bbc.com/urdu/pakistan/2 Islamabad, May 18, 2015. 015/04/150420_ahsan_china_agreement 20 Amanullah Kasi, “MPAs criticize _sq?ocid=socialflow_facebook. change in economic corridor route,” 18 Syed Ali Shah, “Balochistan CM says Dawn, Islamabad, April 22, 2015. not taken into confidence on Pak-China corridor,” Dawn, Islamabad, May 4, 2015.

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Paper consulted although the main strike was observed in parts of agreements that were signed during Quetta on May 6 to protest the Chinese president’s visit were linked alleged change in route of the to Gwadar seaport.21 Balochistan CPEC.24 Assembly had also adopted a unanimous resolution on February Another non-government multi- 28 against perceived modification of party conference was held on CPEC the CPEC route. in Quetta on May 16. The conference welcomed the corridor as a game Like in KP, the Balochistan chapter of changer for the region but opposed ANP also repeatedly opposed any any change in its original route that change in the original design of the passes through northern parts of CPEC route and warned that the Balochistan and southern districts of development plan would become Khyber-Pakhtunkhwa. Politicians controversial if ANP’s demand was from PPP, PTI, PML-Q, JUI-F, JUI-S ignored. The ANP made the demand (Sami-ul Haq faction), Jamaat-e- in a resolution passed at a public Islami, Pakhtunkhwa Milli Awami meeting held at the hockey ground in Party, National Party, Balochistan Quetta on April 28.22 National Party and Hazara Democratic Party attended the A multi-party conference was held in conference convened by the ANP. Quetta on April 29 at the office of JUI- The ruling Pakistan Muslim League- N (Nazriati faction of JUI) that Nawaz, however, stayed away from announced to hold protests across the conference.25 Participants noted Balochistan on May 5 and shutter- that only $2 billion have been down strike on May 6 to oppose the provided to Balochistan in the $45 proposed change in the CPEC route. billion Pak-China agreements. The APC constituted a 12-member committee to meet Prime Minister Balochistan’s nationalist leaders also Nawaz Sharif and Chinese have concerns about the ambassador to resolve the issues demographic change that the mega with dialogue. JUI-F, ANP, Pakistan projects like Gwadar and CPEC Muslim League-Quaid (PML-Q) could bring in the province. They Balochistan, PPP, and have been raising their voice against representatives of traders association non-Baloch settlements in Gwadar. participated.23 Later, a shutter-down Baloch insurgents also frequently

21 Ibid. 24Express Tribune, Islamabad, May 7, 22 Amanullah Kasi, “ANP opposes 2015. change in route of corridor,” Dawn, 25 Muhammad Zafar, “APC opposes Islamabad, April 29, 2015. detours in economic corridor route,” 23Express Tribune, Islamabad, April 30, Express Tribune, Islamabad, May 17, 2015. 2015.

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Silk route monitor: a review of developments on CPEC attack non-Baloch workers and affect Sindh. Karachi and parts of settlers in the province. A prominent interior Sindh remain parts of leader of ruling National Party (NP) different CPEC projects. Hasil Bizenjo was reported by media to have said in the May 28 APC The PPP participated in almost all chaired by Prime Minister Nawaz meetings and multi-party Sharif that with more investment conferences held by political parties coming into Balochistan under the on the CPEC. At the same, its leaders CPEC, more non-Baloch will come to mainly the party chief and former Balochistan in search of jobs, president Asif Ali Zardari tried to squeezing the Baloch population convince political leaders that they further.26 should not make the CPEC controversial. Also, the party asked Hasil Bizenjo also presided over a the government to address genuine two-day meeting of NP’s Central concerns of political parties. Committee in Quetta on May 25-26, which was attended by Chief Mr Zardari hosted leaders of political Minister Dr Abdul Malik Baloch, parties at a dinner in Islamabad on senators, MNAs, MPAs and April 23 reportedly to create a broad- members of the party from the four based political ownership of the provinces. Participants sought a 50 CPEC. The government percent share for Balochistan in the representatives, present in the Gwadar Port Authority and meeting, assured that the prime announced that a committee would minister will take all parties and be formed to draft legislation for provinces into confidence on the claiming revenue to be generated CPEC project.28 from the CPEC in the province.27 Later on April 26,Zardari said in 1.3 Sindh Karachi while addressing a large party rally that the PPP would not Main political parties of Sindh allow the Chinese investment including PPP and MQM although coming under the CPEC projects to welcomed the CPEC projects but also become a victim of political point- raised voice in support of KP and scoring and there would be no Balochistan’s concerns about the politics or opposition on the subject corridor. Apparently, the alleged of Chinese investment coming to change in the CPEC route did not Pakistan. “The incoming investment

26Dawn, May 29, 2015, taking Balochistan govt on board,” http://www.dawn.com/news/1184917. Dawn, May 27, 2015. 27 Saleem Shahid, “China-Pakistan 28Asim Yasin, “Zardari paving way for corridor: NP criticizes centre for not Pak-China corridor,” The News, Islamabad, April 24, 2015.

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Paper will secure future of coming generations of Pakistan,” he Political and community leaders and argued.29 He, however, held out the people of Gilgit Baltistan (GB) assurance that all the fears and welcome the idea of CPEC in their reservations of the Pashtun and area, but complain that their Baloch communities on the CPEC concerns and interests have not been would be addressed in accordance taken into account. They desire of with the Constitution. more direct participation in steering the project. In their conversation with 1.4 Gilgit Baltistan one of the authors, Peer Muhammad, local stakeholders reminded that It is at Gilgit Baltistan that Pakistan despite the project’s direct connects with China. GB and its significance for the GB, the federal capital Gilgit, therefore, will be the government didn’t take the area’s gateway of the corridor. When it people and their representatives into comes to Gilgit Baltistan, below are confidence. The region’s top political two key corridor-related initiatives: representative is the Chief Minister of Gilgit Baltistan. Yet, several noted, 1. The existing Karakorum unlike Punjab’s or Balochistan’s CM, Highway (KKH) will be Gilgit Baltistan’s CM was never expanded, from the border point invited to the internal meeting on the project nor was he taken to China for at China to Islamabad. A portion discussing and signing of the MoUs of the KKH has already been in the past two years. One noted that expanded from Khunjerab, GB, many came to know about the to Thakot, Khyber Pakhtunkhwa. project only after the Chinese About 500 km of this expanded President’s visit.30 highway falls under GB, from After the visit of Chinese president to Khunjerab to Kohistan. Pakistan, an amalgamation of all GB- 2. A 700-km long railway track will based political and religious parties, be laid from Kashgar, China’s the Awami Action Party (ACC), bordering city, to Islamabad, convened a special All Parties Pakistan’s capital. Again, this Conference in Hunza Aliabad, on track will go through GB. April 26. Participants expressed serious concern that the federal

29 Azeem Samar, “Politics won’t be 30 Peer Muhammad’s interview with allowed on Chinese investment: Shahid Ashraf Tarrar, chairman NHA, Zardari,” The News, Islamabad, April 27, May 29, 2015. (The NHA is the leading 2015. executing agency of motorway projects under the CPEC).

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Silk route monitor: a review of developments on CPEC government had completely Self-Governance Rule, 2009. The neglected the GB’s leadership on the area’s politicians therefore wondered CPEC, to pass through GB. They if the federal government can use the territory for an international project, demanded that the government at all. declare special economic zones in GB under the project, to compensate Any major investment involving GB, those affected by it. The conference with an undecided constitutional linked the project with the status, can cost the region constitutional rights of GB and said economically and politically.32 without fulfilling this demand, the Already, partly because of this status, the region continues to rank lower in project will not be allowed to the socio-economic development 31 implement through GB. ladder of the country.

Members of GB Council officially Local stakeholders believe that if wrote to the Minister for Planning Gilgit Baltistan is given proper and Development Mr. Ahsan Iqbal constitutional status like much of the for a briefing so that they too are on rest of the country, they could raise board. However, the minister has so their voice in support of their rights far not answered the demand. at national forums ( such as NFC and Council of Common Interests) and Some see the corridor having impact therefore could get more benefits on the GB’s constitutional status, a from projects such as the CPEC. state of limbo. GB is awarded special status in the Constitution of Pakistan, Some said if the project fails to dissimilar to the ones granted to engage youth, and rather render Pakistan’s four provinces. Until them jobless, several of them can be recently, the area was known as exploited towards radicalization.33 Federally Administered Northern Some pointed that should the area Areas (FANA). Instead of not be accommodated in the CPEC, administering the region through the the possibility that the areas’ youth constitution, as most of the rest of the may rise [against it] cannot be country is, GB is governed through denied. Under such a circumstance, Gilgit Baltistan Empowerment and young people can be used in the

31Daily Bang-e-Sahar (Urdu), Gilgit- and former GB Council member, Gilgit, Baltistan, April 2015. http://www.bangesahar.net/popup.ph 33.Peer Muhammad’s interview with p?r_date=04-27-2015&img=04-27- political analyst Aziz Ali Dad on 2015page-1-10. telephone. 32Peer Muhammad’s interview with Advocate Amjad Hussain, a PPP leader

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Paper hands of saboteurs to destabilize the containers transiting annually project.34 A few made a reference to through the border, the trade volume how exploitation of resources in fell in the range of PKR 2.5 billion to Balochistan resulted into a 3 billion. Many, therefore, fear that movement there in past. This, they the vibrancy of Sost Dry Port will said, can create insecurity too. The further diminish after the completion local insecurity, however, they said, of the CPEC project.36 Bypassing this can be overcome by satisfying the dry port means denying livelihoods locals about their share in the to the area’s 5,000 traders, project.35 businessmen, transporters, hoteliers and labourers.37 The authors observed that the dominant economic concern in GB Former finance minister of GB was that once the corridor project is Legislative Assembly Mirza Hussain completed, with rail track and argued that if the rapid train service motorways laid down, the existing is directly linked from Kashgar economic trade activities of GB’s (China) to Havalian (KP, Pakistan), people with China’s will halt. the project is a disaster for the existing economic and commercial As cargo trains will depart from activities in GB. The future for GB is China to the proposed dry port in bleak, Hussain, who is also a leading Havalian directly, located in Khyber trader, argued. GB, he said, will be Pakhtunkhwa, the existing Sost Dry used to tread rails and trucks, the Port will turn useless. goods of which will be uploaded in China and reach to Havalian, As of now, annual trade with China bypassing GB.38 via Khunjerab stands at PKR 1.5 billion, with 700 to 800 containers Although the Karakorum Highway passing through the border. Over has been expanded, as discussed 5000 people from GB are involved, above, the highway will draw less directly or indirectly, with the attraction in the presence of the fast Chinese trade through the Sost Dry train service. Traders will prefer the Port. The trade volume was even train service due to less higher before a natural disaster transportation costs. The train, on shook Attabad in 2010. With 4,000 which goods will be loaded in

34 Peer Muhammad’s interview with 36Peer Muhammad’s interview with former Finance Minister GB Legislative Javed Hussain, president of GB Chamber Assembly Mirza Hussain, Nager, April of Commerce and Industry, Gilgit, May 2015. 2015. 35Peer Muhammad’s interview with 37 Ibid. Inayatullah Shumali, Caretaker 38Peer Muhammad’s interview with Information Minister of GB, Chillas. Mirza Hussain.

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China’s Xinjiang province, will snake minister frequently issued through mountains and tunnels, statements to dispel the leaving nothing for the GB territory. impression that the route of CPEC is being changed. Federal GB leaders and people are also concerned that the government has Minister Ahsan Iqbal told BBC not planned to establish any trade or Urdu in April that the CPEC industrial zone in the GB. Only then alignment passing though will the CPEC shower benefits upon Balochistan and KP will be GB, as other parts of the country. completed first. The minister also Some said that the corridor terminal provided details about the three be established in Gilgit. planned routes of the CPEC Locals fear that the construction of including eastern, western and motorways and railway tracks in the central.40 area will decrease landholding of the people, who would be forced to settle  Ahsan Iqbal again told the elsewhere. A conference, attended by National Assembly on April 29 in political leaders and community a policy statement that there was representatives of Hunza, Nager and no plan to change the CPEC Gujal on April 26, as cited earlier, demanded the federal government to route and all three routes were immediately announce a special being constructed package under the CPEC demand simultaneously.41 Later, on May that the government declare special 11, Ahsan stated: “I assure you economic zones in GB under the that I will quit and not defend project, to compensate those affected [the decision] if someone could by it.39 prove that the route, as agreed on 1.5 Government efforts to July 5, 2013 [during the PM’s visit 42 achieve political consensus to China], has been changed.”   Leaders of the ruling PML-N Government frequently assured including ministers and prime leaders of political parties that

39Daily Bang-e-Sahar (Urdu), Gilgit- 2015/04/150420_ahsan_china_agreemen Baltistan, t_sq?ocid=socialflow_facebook. http://www.bangesahar.net/popup.ph 41 Azam Khan, “Economic corridor: In p?r_date=04-27-2015&img=04-27- policy statement, govt denies change in 2015page-1-10. route,” Express Tribune, April 30, 2015. 40 BBC Urdu April 20, 2015, 42 Qamar Zaman, :Economic passageway: http://www.bbc.co.uk/urdu/pakistan/ Senators seek briefing on trade route by PM,” Express Tribune, May 12, 2015,

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the CPEC takes less developed  The government provided a areas into the folds of active detailed map of the CPEC development (particularly showing the provincial capitals Gilgit-Baltistan, Thar and (Quetta, Peshawar, Karachi and Gwadar regions). The CPEC Lahore) among the major nodes would benefit all provinces and of the project. The map is given bring peace, harmony, below: cooperation and economic development in the entire country.

Source: http://www.pc.gov.pk/wp-content/uploads/2015/04/cpecs.jpg

 Prime Minister Nawaz Sharif chaired an all-party conference (APC) on CPEC at the PM House Islamabad on May 13. One of the key outcomes of the conference was an agreement among parties to set up a special bicameral

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parliamentary committee for CPEC project. The meeting regular oversight of the CPEC decided to first build the western project.1 alignment of the route, which  Responding to small provinces’ runs from Gwadar to D.I. Khan concerns about establishment of before entering Punjab, which in industrial zones in Punjab, large helped in subsiding the Federal Minister Ahsan Iqbal political opposition. It was wrote in his special column in a decided that the remaining leading Urdu newspaper Jangon concerns of parties will be May 21: “Baloch and Pashtun addressed by a bicameral people are being misguided [on parliamentary committee which CPEC] by telling them that the government had already industrial zones are to be agreed to constitute for a regular established in Punjab only. In oversight of the project. The fact, establishment of only one government also agreed to set up industrial zone has been decided joint working groups having so far under the CPEC project representation of all provinces to and that will be in Gwadar. The give their views and suggestions establishment of more industrial on economic and industrial hubs zones in the future will be to be built along the corridor.3 decided by the China-Pakistan Joint Working Group, which will  Before the May 28 conference, be formed in the next two government put extra efforts months. I had assured leaders of and gave separate briefings to all political parties in a meeting senior political leaders at their that all provinces will be doorsteps. In this regard, consulted for the establishment meetings were held with the of industrial zones.”2 leaders of Pakhtunkhwa Milli Awami Party (PkMAP), PTI,  Another APC was held at the Qaumi Wattan Party-Sherpao, Prime Minister’s Office on May JUI-F and ANP. The 28 that gave a go ahead to the consultation process completed

1Khawar Ghumman, “Special committee 3 Khawar Ghumman, “Parties give go- to oversee CPEC project,” Dawn, ahead to China-Pak corridor,” Dawn, Islamabad, May 14, 2015. May 29, 2015. 2 Daily Jang (Urdu), Rawalpindi, May 21, 2015.

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just minutes before the APC.4 militants. Thirdly, government evolved and announced a National Action Plan (NAP), which, though 2. Security dimension being implemented partly, has put pressure on extremist and militant groups in the country. This section discusses the security situation in the country in recent Military operations in North months, particularly since start of the Waziristan and Khyber agencies year 2015, as well as government’s have significantly damaged efforts to achieve peace and maintain militant’s networks and law and order in different parts of infrastructure. But threat of militancy Pakistan, including conflict zones. It is still there, although with a lesser also describes CPEC-specific security intensity. Militants have been measures taken by the government. successful in carrying out some major attacks this year including a suicide 2.1 Security situation of blast in an imambargah in Shikarpur Pakistan in 20155 (Sindh) in January; suicide attacks on Shia worshippers in Peshawar in There has been relative improvement February; suicide attacks on churches in the country’s security situation in Lahore in March; targeted killing since start of this year. The number of of 20 non-Baloch workers in Kech terrorist attacks has gradually (Balochistan) in April; lethal attacks declined over the months. One of the on Ismaili community in Karachi and key factors for that were the Pashtun community in Balochistan in extensive security operations May; and suicide bombings that conducted against militants in North killed Punjab Home Minister and 18 Waziristan and Khyber agencies of others in Attock, Punjab in August. FATA as well as other parts of the country. Also, since December 2014 On the whole, 431 terrorist attacks attack on a school in Peshawar, took place across Pakistan between which had killed over 100 children, January and July this year, which federal and provincial governments claimed 675 lives and injured 855 have been more vigilant and have others. Regional distribution of these increased surveillance against the attacks is given at Chart 1. Chart 1: Terrorist attacks and fatalities in Pakistan (1 Jan. to 31 July 2015)

4 Qamar Zaman, “China-Pakistan 5 All statistics used in this section are Economic Corridor: Backdoor meetings based on Pak Institute for Peace Studies’ helped forge consensus,” Express (PIPS) database on conflict and security, Tribune, May 29, 2015. unless otherwise described.

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No. of Attacks No. of people killed

183 192 167 158 98 96 78 73 44 16 1 0

There had been a declining trend in Trends of terrorist attacks in different terrorist attacks in Pakistan from regions of Pakistan since January this January to April, but in May the year are given at Chart 2. number of terrorist attacks rose once again. In May, the number of attacks increased in all regions of Pakistan. Chart 2: Trend of terrorist attacks in Pakistan since January 2015

100 Balochistan 80 Khyber 60 Pakhtunkhwa 40 FATA 20 No. ofNo. Attacks Sindh 0 Islamabad & Punjab Gilgit Baltistan

As for terrorist attacks, the number of from January to April, but the people killed in these attacks also fell number rose in May, followed by a

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Paper significant decline in subsequent related fatalities since January this months Balochistan, FATA and year. (See Chart 3) Karachi figure high in terrorism-

Chart 3: Trend of fatalities in terrorist attacks in Pakistan since January 2015

200 180 Balochistan 160 140 120 Khyber 100 Pakhtunkhwa 80 FATA 60

terrorist attacks terrorist 40 Sindh

No. of people killed in killed people of No. 20 0 Islamabad & Punjab

2.1.1 Balochistan officials have also been reported from the province in past. Balochistan’s security remains volatile where many militant, Baloch insurgent groups see mega sectarian and insurgent groups are projects in Balochistan including active. Highest number of terrorist Gwadar and the CPEC as a attacks for any one region of the conspiracy to capture Balochistan’s country in 2015 was reported from resources. That implies there is risk of Balochistan. (See Chart 1) If property attacks on the CPEC project sites and security measures are not taken, the workers. An insurgent commander implementation of CPEC projects Harbiyar Marri, chief of the Baloch could be relatively more affected in Liberation Army (BLA) said in a Balochistan as compared to other recent interview with a local regions. The province has a history of newspaper: “Pakistani security attacks on state installations, forces have increased operations in development projects, and non- Makran and Gwadar regions for Baloch workers and settlers. Many paving the way to implement Pak- incidents of kidnapping of foreigners China agreements… Enforced including Chinese and government disappearance of Baloch people in

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Silk route monitor: a review of developments on CPEC the name of security operations and Pakistan Economic Corridor. presenting Baloch people as Pakistan has since long blamed India insurgents cannot befool the world… for fueling insurgency in Balochistan China has expansionist designs and by supporting Baloch insurgent wants to capture resources of groups. Balochistan to extend its outreach to Middle East. Pakistan is supporting Security forces have also increased China by killing the Baloch people in their security and search operations the name of providing security for in the province in recent months, [CPEC] projects.”1 mainly in areas close to Gwadar and Makran coastal belt. There were also In recent months, Baloch insurgents reports that a Karachi-like operation have increased attacks on non-Baloch could be launched in Balochistan workers as well. In May, 22 Pashtuns after the Mastung killings.2However, were target killed in Mastung it would be indeed a great challenge reportedly by a Baloch insurgent for provincial government, federal group United Baloch Army (UBA). In government and army to come on the month of April, too, militants of one page and evolve a consensus Baloch Liberation Front (BLF) had security policy for Balochistan. shot dead 20 non-Baloch laborers Historically, Balochistan’s nationalist hailing from Punjab and Sindh. Most leaders and also people have seen analysts are convinced that these Islamabad and security targeted killing are an effort by establishment with an eye of Baloch insurgents to give a message suspicion and mistrust. Besides that Balochistan is not safe for military operation, extensive political projects like China-Pakistan efforts are also needed to restore Economic Corridor. Many also see a peace in the province. foreign hand behind these attacks which want to disrupt China-

Chart 4: Regional distribution of terrorist attacks in Balochistan (1 Jan. to 31 July 2015)

1 Daily Azadi (Urdu), Quetta, April 16, Balochistan,” Express Tribune, May 31, 2015. 2015. 2 Abdul Mateen, “Curbing violence: Karachi-style operation planned for

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Killed Attacks

5 Zhob 2 7 Sibi 4 50 Quetta 33 0 Qilla Saifullah 1 2 Qilla Abdullah 4 0 Pishin 3 4 Panjgur 10 3 Nushki 6 6 Nasirabad 14 23 Mastung 3 15 Loralai 5 5 Lasbela 3 0 Kohlu 2 1 Khuzdar 1 5 Kharan 3 24 Kech 11 1 Kalat 2 4 Jhal Magsi 2 6 Jafarabad 12 10 Gwadar 12 3 Dera Bugti 29 0 Bolan 1 9 Awaran 4

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2.1.3 FATA and KP Militants’ launch of terrorist attacks in agencies other than North A total of 174 terrorist attacks took Waziristan and Khyber was place in KP and FATA between apparently intended at distracting January and July this year, which security forces form those two claimed 256 lives. This is a significant agencies where the latter are engaged decrease in terrorist attacks (53 in military operations against percent) and fatalities (about 48 militants. For instance, the militants’ percent) when compared to previous activities have increased in South year’s corresponding months. Waziristan in recent months. Armed During the same period of previous clashes between militants and the year (i.e. January to July 2014), as security forces were reported from many as 372 reported terrorist attacks there in July, which indicates that had killed 491 people across KP and militants have started to regroup FATA. there.

That suggests that military Militants’ ability to have cross- operations in FATA have weakened agencies movement in FATA, mainly militants’ capacity to strike in these relocations from North Waziristan two regions. But the threat is not and Khyber agencies due to military completely eliminated. Indeed, operations there, could pose a threat militants have been successful in to security forces and also to peace carrying out terrorist attacks in and security of tribal areas and also almost all seven agencies of FATA parts of KP province which will be since January this year (See Chart 5). traversed by CPEC routes.

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Chart 5: Regional distribution of terrorist attacks in FATA (1 Jan. to 31 July 2015)

Killed Attacks 47 South Waziristan… 15 9 Orakzai Agency 6 35 North Waziristan… 10 4 Mohmand Agency 13 20 Kurram Agency 14 27 Khyber Agency 23 6 FR Regions 3 10 Bajaur Agency 12

The security situation in Khyber agencies such as Bannu, Tank and DI Pakhtunkhwa has also relatively Khan. improved but law enforcement agencies need to be more vigilant to Militants carried out 78 terrorist prevent any major attack in the attacks in 15 districts of Khyber future. As the military operations Pakhtunkhwa (See Chart 6) between have frustrated the militants they January and July this year. That could try to retaliate in form of some implies militants’ outreach in Khyber major attacks such as they carried out Pakhtunkhwa, including to areas on a school in Peshawar in December where CPEC projects will be aligned, last year. Also, militants have shown is not fully broken; nor is their an increased presence in recent operational capability completely months in the KP districts bordering destroyed. on North and South Waziristan

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Chart 6: Regional distribution of terrorist attacks in KP (1 Jan. to 31 July 2015)

No. of people killed No. of attacks

3 Tank 4 6 Swat 4 1 Swabi 2 38 Peshawar 27 1 Nowshera 2 2 Mardan 2 6 Mansehra 4 4 Malakand 2 0 Lower Dir 1 5 Kohat 3 6 Haripur 1 0 Hangu 4 17 D.I Khan 11 6 Charsadda 5 3 Bannu 6

2.1.4 Karachi and Interior between January and July (2015). A total of 192 people lost their lives and Sindh another 137 were injured in Sindh over the mentioned period of time. In terms of terrorism-related Most of these casualties concentrated fatalities, Sindh, mainly Karachi, was in two cities of Sindh, i.e. Karachi and the worst affected region of Pakistan Shikarpur. (See Chart 7)

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Chart 7: Regional distribution of terrorist attacks in Sindh (1 Jan. to 31 July 2015)

No. of attacks No. of people killed

122

60 63

1 2 1 0 4 0 5 1 1 1 4

Yet, Karachi has been relatively 2.7 per day as compared to 5.7 peaceful in 2015, particularly in murders per day in 2014 and 8.9 recent weeks and months, compared murders per day in 2013 [for the to previous years. Apparently, same period]”.1 surgical operations against militants and criminal elements have Yet, militants have at times managed significantly weakened the to show their presence by carrying infrastructure of terrorists and out either high-profile targeted criminal gangs in Karachi. According killings or terrorist attacks like the to a recent report compiled by the one on Ismaili community in May Sindh police and submitted to the this year. A long existing nexus provincial home department, “the among Sunni sectarian and other murders and targeted killings in local and international terrorist Karachi are all-time lowest.” The organizations in Karachi is a huge report said that the analysis of first challenge for security agencies. six months of 2015 “shows that average murders reported in 2015 are

1 Hasan Mansoor, “971 killed in first six months of 2015 in Karachi,” Dawn, July 22, 2015.

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Meanwhile, interior Sindh is least 30 major attacks since 2004 apparently next target of militant and including attacks on Sri Lankan sectarian outfits, which have been cricket team in 2009, attacks on strengthening their positions there Ahmadi worship places in 2010, and since long. A lethal suicide blast in an attack on Wagah border last year.2 Shikarpur in January this year That means terrorists have support targeted an imambargah and killed bases in parts of Punjab from where 63 people. Sectarian tensions and they can operate to hit their targets. militant violence are not new in this part of Sindh (Shikarpur, Sukkur and After the announcement of NAP, Khairpur). Punjab government has enhanced surveillance and police has Although most of the recent major conducted dozens of search terrorist attacks in Sindh have been operations in different parts of the sectarian-oriented, however in past, province. Hundreds of militants and sectarian militant organizations, as their supporters have also been well as Taliban militants, have arrested. Supporters of militants are carried out major attacks against apparently under immense pressure. state interests and security agencies in the province. Sectarian In July, Malik Ishaq, the main leader organizations’ nexus with Taliban and chief of the core/main group of and Al-Qaeda makes them Lashkar-e-Jhangvi (LeJ) was killed dangerous for the projects like CPEC. along with his two sons and others in Muzaffargarh, in south Punjab, in an On the whole, although militants and alleged police encounter.3The sectarian groups have been assassination was described by many weakened in the province including as a severe blow to the LeJ. Also it in interior Sindh, they still have the indicated that the government capacity to attack the CPEC project Punjab, which has since long been sites; they can also kidnap workers criticized for its alleged inaction engaged at those sites. against sectarian groups, is becoming serious in eliminating the militant 2.1.5 Punjab and Islamabad groups operating in the province.

Punjab is apparently the safest region In the following month, Punjab of Pakistan in terms of incidence of Home Minister Shuja Khanzada was terrorist attacks. But the province, killed along with 18 others in a mainly its capital Lahore, has faced at suicide blast in his home town in district Attock. Reportedly militants

2Sabir Shah, “30 major terror attacks in 3Dawn, July 29, 2015, Lahore since 2004,” The News, February http://www.dawn.com/news/1197098. 18, 2015.

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Paper of Lashkar-e-Jhangvi was involved in the province might be keeping low the attack; a TTP splinter group profile and have not been eliminated. Jamaatul Ahrar had claimed the That implies the threat of major responsibility for the attack. attacks including on CPEC project sites and workers still exists. For that, Although the province has witnessed the provincial government needs to fewer – as compared to previous enhance its implementation of NAP. year’s corresponding months – and There is also need for enhanced mostly low scale attacks this year, but coordination among civilian and the militants and their supporters in military intelligence agencies.

Chart 8: Terrorist attacks in Punjab & Islamabad (1 Jan. to 31 July 2015)

No. of attacks No. of people killed

23

9 4 4 2 2 3 3 3 1 1 1 1 1 1 0 1 0

2.1.6 Gilgit Baltistan areas. However an almost absence of militants’ bases and support Only one terrorist attack was structures in Gilgit and Baltistan reported form the region during suggests the threat level to the CPEC 2015, which did not cause any in this region will be low. However fatality. However, the region has sporadic attacks on the CPEC-linked seen plenty of sectarian violence in sites and personnel cannot be ruled past. Some high intensity attacks in out. Some terrorist attacks from the recent years on security forces and region in recent years, which hit high foreigners also revealed TTP and value targets such as 2013 attack on other militants’ outreach to northern tourists at Nangaparbat base,

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Silk route monitor: a review of developments on CPEC attracted the world attention and also implementing these points are raised concerns that the Pakistani mainly institutional including militants, mainly the TTP, in lack of capacity of related collaborations with ETIM and institutions and departments and Chinese Uighur militants could try to also lack of coordination among entrench themselves in this region. Other than that most of the violent civil and military intelligence incidents reported from this region agencies. Also, lack of political have been sectarian-related. will is a factor. Political leadership has yet to fully take 2.2 Government’s efforts to the ownership of the country’s achieve security war against terrorism.  National Counter Terrorism  The National Assembly and the Authority (NACTA) has yet to be Senate unanimously passed the fully empowered and the 21st Constitutional Amendment establishment of joint Bill 2015 in January this year by intelligence directorate is only a more than a two-thirds majority, proposal so far. paving the way for the  However, in accelerated constitution of military courts to counterterrorism efforts in KP conduct the speedy trials of and FATA, three zones of terrorists. counterterrorism departments  The government also established (CTD) were established in National Action Plan in January March. The provincial to crack down on terrorism and government pledged to fight to supplement the ongoing anti- impending militants’ activities terrorist offensive in north- through CTDs. western Pakistan. But the government and independent 2.2.1 Security Operations reports suggest that implementation on the 20 points Pakistan’s security and law of NAP has been slow. enforcement agencies have killed a  The government itself is not total of 1,312 militants between January and July this year in as many happy with the level of as 183 operational strikes and clashes achievement on the front of with militants, across 41 districts of implementation of NAP. The 20 all four provinces. points of the NAP have a wide scope. The challenges towards

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Chart: Militants killed in operations and clashes with security forces (Jan. to Jul. 2015)

Silk route monitor: a review of developments on CPEC

2.2.3 Specific security Chinese working in Pakistan on measures for CPEC around 210 development projects.2  Pakistan Army has created a  Government has in principle special security division for the agreed that military will take protection of Chinese engineers, leading role in formulating and project directors, experts and implementing security plan for workers employed on various the CPEC in close collaboration Chinese funded projects across with the interior ministry. Pakistan. According to military sources quoted in media, a total  The government has also of 10,000 troops have been allocated Rs3.5bn under the dedicated to this purpose and a latest PSDP (Public Sector two-star senior military officer, Development Program) for who would report directly to the special security forces to protect General Headquarters (GHQ), Chinese engineers, project would head this security directors, experts and workers division. Out of 10,000 troops, employed on various Chinese- over 5,000 will be from the funded projects across Pakistan.3 special services group of On the whole, the budget plan Pakistan Army who are specially for 2015-16 describes that as trained for counter-terrorism and many as 28 wings of Civil Armed security.1 Forces will be raised, at the cost of 7.5 billion rupees, to provide  Even before the decision to security for CPEC and Chinese establish special security workers. division, an estimated 8,000

personnel of police and paramilitary forces have been 3. Developmental progress on deployed across the country for CPEC the security of more than 8,112

1Mateen Haider, “Army’s special security workers,” Express Tribune, Islamabad, division to protect Chinese workers in March 30, 2015. Pakistan,” Dawn, Islamabad, April 21, 3The News, Islamabad, Saturday, June 06, 2015. 2015. 2 Zahid Gishkori, “Economic corridor: 12,000-strong force to guard Chinese

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 Pakistan and China signed 51  Provision of material for agreements and memorandums tackling climate change; and of understanding (MoUs) of  Projects in the Gwadar Port bilateral cooperation in different region and establishment of fields during Chinese president’s China-Pakistan Joint Cotton visit to Pakistan in April 2015. Biotech Laboratory and The $28bn financing agreements China-Pakistan Joint Marine will immediately come into the Research Centre. implementation phase because necessary processes have already  There were reports that been completed. These include:4 development funds and loans  1000MW solar power park in from China for the CPEC project Punjab; could get delayed due to the  870MW Suki Kanari (Khyber issue of double taxation and Pakhtunkhwa) hydropower absence of an agreement on project; exempting Chinese companies  720MW Karot (AJK) from taxes on the profits they hydropower project; make in Pakistan. Federal Board  Three wind power projects at of Revenue argues that it cannot Thatta of United Energy achieve the government- Pakistan (100MW), Sachal provided targets if complete tax (50MW) and Hydro-China exemption will be provided to (50MW); Chinese companies.5 Pakistani  Chinese government’s officials were to hold further concessional loans for the negotiations with Chinese tax second phase up-gradation officials and companies in of Karakorum Highway August 2015. (Havelian to Thakot);  Karachi-Lahore Motorway  Similarly there could be issues of (Multan to Sukkur), Gwadar bureaucratic hurdles, which Port east-bay expressway might affect smooth functioning project and Gwadar of CPEC implementation. Mr Zu international airport; Young, president of a Chinese company Zonergy said in

4Khaleeq Kiani, “$28 billion accords for 5 Daily Dunya (Urdu), Islamabad, May fast-track projects,” Dawn, April 21, 2015. 19, 2015.

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Islamabad on April 22 while while the Cabinet Committee on sharing his views on the Energy is also a part of it. Bahawalpur power project: Chinese and Pakistani working “These projects can be completed groups have already within the stipulated timeframe conceptualized, structured and only when the concerned time-framed all the CPEC ministries and departments in projects Pakistan exhibit a matchless coordination at every phase.6  Budgetary allocations: Headed by Prime Minister Nawaz Sharif,  In this backdrop, government is the National Economic Council trying to put in place a multi-tier (NEC) approved 2015-16’s mechanism to ensure that CPEC federally funded development projects do not fall victim to program including over two and bureaucratic hurdles and delays. a half dozen CPEC-related ‘Prime Minister Delivery Unit’ projects. The approved NEC plan has been established at the PM’s shows that the government has Office comprising professionals included Rs942 billion worth of from public and private sectors CPEC projects in the 2015-16 and having expertise in CPEC- budget and allocated Rs171 related projects.7 Supervised by billion for spending in the year.8 the prime minister, the unit will Budgetary allocations for CPEC monitor the CPEC projects and routes are described below:9 provide daily, weekly and monthly progress reports to the  Rs20.8 billion worth of prime minister. The Ministry of CPEC projects will go to the Planning, Development and western route. However the Reform, currently headed by Senate standing committee Federal Minister Ahsan Iqbal, on finance and revenue later has a leading role in the unit recommended to enhance allocation for the western

6 Khalid Mustafa, “High degree of projects,” The News, Islamabad, May 8, coordination required for making CPEC 2015. a success story,” The News, Islamabad, 8 Shahbaz Rana, “Budget 2015-16” 12% of April 23, 2015. approved funds foes to CPEC’s western 7Ansar Abbasi, “Multi-tier mechanism in alignment,” Express Tribune, Islamabad, place for timely completion of CPEC June 2, 2015. 9 Ibid

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route by Rs100 billion under for all the routes. For the the CPEC so as to fulfill the construction of 120km consensus decision of May- Thakot to Havelian section, 28 All Parties Conference the NEC approved Rs23.5 (APC) and the Prime billion. The total cost of the Minister’s promise to build project is Rs95.4 billion. For this route on a priority the acquisition of land for basis.10 this project, the NEC allocated another Rs6  A lion’s share of Rs95 billion. billion, or 57% of total CPEC allocations, will go to  Similarly, for construction projects on the eastern of the Islamabad-Mianwali- corridor. The NEC has Dera Ismail Khan road, approved Rs60.2 billion for which will link eastern and the construction of a 387km central routes, the NEC Multan-Sukkur section of approved Rs10 billion. The the eastern route. The total total cost of the project is cost of this project is Rs259.3 Rs68 billion.12 billion. For the 296km Sukkur-Hyderabad section  In order to complete work of the eastern route, the on the Gwadar Port, the NEC allocated Rs10.5 NEC approved eight billion. The total cost of the projects worth Rs41.6 billion project is Rs148 billion. It and allocated Rs6.8 billion approved Rs20 billion for a for the next year. These 230km Lahore-Abdul projects include Hakeem road section.11 construction of break way waters, capital dredging of  An amount of Rs31.8 billion berthing areas, is proposed for the northern infrastructure development alignment, which is the link for the Export Processing

10 Mehtab Haider, “Senate panel western alignment,” Express Tribune, demands Rs100 bn more for CPEC Islamabad, June 2, 2015 western route,” The News, June 12, 2015. 12 Ibid. 11 Shahbaz Rana, “Budget 2015-16” 12% of approved funds foes to CPEC’s

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Zone Authority, Pak-China connects to Rattodero, in Technical and Vocational Sindh. Centre and upgrading of the  The road linking Gwadar to existing 50-bed hospital to Khuzdar, Quetta and DI 300-bed at Gwadar. The Khan is under construction NEC also approved Rs4.7 and is expected to be billion allocation for the completed till next year, i.e. construction of Eastbay 2016.14 The road will further Expressway that will link link to Karakorum Highway. Gwadar with the coastal  A couple of sections of the highway.13 road between Gwadar and Quetta are currently at an advanced stage of  Meanwhile work on different construction. parts of the CPEC projects  Work on Peshawar-Karachi continues. The Planning motorway project started Commission and other related over 20 years back and effort departments do not provide is being made to complete it some specific information about in next few years. these projects on their websites.  Prime Minister Nawaz Sharif However the following inaugurated in Karachi the paragraphs describe progress on first phase of the Karachi- different CPEC projects based on Lahore (M-9) Motorway on information drawn from media March 11, 2015 which will reports, online sources and and cost Rs. 36 billion. M-9 will official statements. facilitate people commuting  The work on M•8 (motorway between Karachi and major from Gwadar to Rattodero) cities including Sukkur, is underway and is expected Badin, Ghotki, Rohri, Dadu, to conclude by December Pannu Aqil, Abro, 2015. M-8 is connecting Sadiqabad, Rahim Yar Khan, Gwadar to Turbat, Panjgur Zahir Pir, Jalalpur Peerwala, and Khuzdar regions in Balochistan and further

13 Ibid. 14 Federal Minister Ahsan Iqbal was quoted as saying in a report by Asif Iqbal published on BBC Urdu on April 20, 2015.

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Abdul Hakim, Mamu Kanjan  The work on 900 MW solar and Nankana Sahib. project at Bahawalpur, South  A feasibility study is Punjab, is going on with 150 underway for the upgrading Chinese and 100 locals of Karachi-Peshawar Main working on the site. This and Line. other similar solar power  Survey for route of KKH•I stations will become a 'solar from RaiKot to Khunjerab, oasis' in the CPEC.16 which will ultimately link up to the Kashgar, is underway. 4. Regional perspective  According to details provided by National The corridor will certainly improve Highway Authority, prospects for regional cooperation in Havelian to Khunjerab trade and economic projects as well as for peace and stability. Pakistan’s railway track was approved refusal to send its troops to Yemen in in September support of Saudi Arabia, which 2014.15Currently the work is would have annoyed a neighbor Iran, going on the track. and efforts to support Afghanistan’s  E35 Expressway, or the reconciliation with the Afghan Hazara Motorway, is under Taliban are being seen by many as a paradigm shift in Pakistan’s regional construction. Prime Minister strategic outlook. Chinese Nawaz Sharif had investment and the CPEC are playing inaugurated it in November a key role in that regard. 2014. The motorway will link Hassan Abdal in Punjab with There is a perception in Pakistan that the cities of Haripur, China is supporting Pakistan’s efforts Havelian, Abbottabad, and in establishing good ties with Afghanistan. There were reports in Mansehra in Khyber media before Chinese president Xi Pakhtunkhwa. Jinping’s visit to Pakistan on April 20  Feasibility study is that Beijing has asked Islamabad to underway for the Havelian upgrade the proposed plan to Dry Port. construct a road network under the CPEC from six to eight lane arteries

15 http://nha.gov.pk/wp- 16 Khalid Mustafa, “High degree of content/uploads/2012/09/Confirmed- coordination required for making CPEC Minutes-of-238-Executive-Board- a success story,” The News, Islamabad, Meeting.pdf. April 23, 2015.

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Silk route monitor: a review of developments on CPEC extending them to Afghanistan. At the same time, Iran has again “That is why Pakistan has decided to asked India to invest in Iranian increase the number of trade routes Chabahar port,20 which many believe with Afghanistan to 16 from the will not only open up Indian access to existing four,” a report published in a Afghanistan and Central Asia but leading English newspaper said.17 also prove a competition for Five new trade routes would be Pakistan’s Gwadar port, currently opened in Balochistan and seven in being operated by Chinese Khyber Pakhtunkhwa.18 companies. In that context, it yet remains to be seen to what extent Iran has recently expressed its CPEC and Gwadar port could interest in becoming part of the develop cooperation and China-Pakistan Economic Corridor connectedness among countries in with a view to become part of the region. restoration and expansion of the ancient Silk Route which has India raised objections on the CPEC historically been a means to transfer by summoning Chinese envoy in trade products and also culture from Delhi to the Ministry of External east to west linking India, China and Affairs, days before the Indian Prime Pakistan to Mediterranean Sea.19 Minister Narendra Modi’s visit to China in May. India’s objections were Pakistan has also welcomed the linked to CPEC route passing agreement on Iran’s nuclear through areas which India believes program, recently reached between are still contested including Kashmir Iran and the six world powers. and Gilgit-Baltistan.21 However, a Pakistan believes that the easing of few weeks before this development, international sanctions on Iran in the India’s high commissioner to aftermath of the deal could allow Pakistan had said that India had no Pakistan to complete its part of Iran- worries over the construction of Pakistan gas pipeline section, as per CPEC as an economically-strong the agreement signed in 2013.

17 Khalid Mustafa, “China tells Pakistan 19 Muhammad Waziri, “Iran’s interest in CPEC success depends on peaceful Pak- restoration of Silk Route” (as translated Afghan ties,” The News, Islamabad, form Urdu), BBC Urdu, June 8, 2015, April 19, 2015. http://www.bbc.com/urdu/world/201 18 The existing four trade routes between 5/06/150608_iran_slik_road_sr?ocid=so Pakistan and Afghanistan include cialflow_facebook. Chaman, Torkham, Ghulam Khan and 20 “Iran has offered India bigger role in Miran Shah. The Miran Shah route is strategic port, says envoy,” Dawn, July currently non-functional due to a military 18, 2015. operation going on in North Waziristan. 21Express Tribune, Islamabad, May 12, 2015.

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Pakistan would bring stability to the region.22 Others believe that despite its Security experts believe that India is instantaneous protest, India will be using Baloch insurgents against the in the long run influenced positively development of the CPEC. ‘One by the CPEC, and may wish to start India’, an Indian propaganda website reportedly managed by or become part of similar projects of Indian intelligence agency RAW regional connectivity in the future. published an interview of Allah Chinese also think that a successful Nazar Baloch – leader of a Baloch completion of the CPEC will make insurgent group Baloch Liberation easy for China “to pursue India, Front (BLF) which is mainly active in Bangladesh and Myanmar for the areas close to Gwadar including 24 Kech, Awaran and Panjgur – early East Asian corridor”. April this year. The contents of the interview revolved around allegations against Pakistan’s security forces, intelligence agencies and Pak-China relations.23 Analysts claimed that uploading of interview of a Baloch insurgent commander on an Indian website suggested that India had sort of links with the Baloch insurgents, which it could use in future to create security problem for the implementation of CPEC- related projects.

22 “Indian not threatened by Pakistan- 23 Mian Saifur Rehman, “RAW website China economic corridor: envoy,” hits at Pak-China corridor,” The News, Express Tribune, Islamabad, April 23, Islamabad, April 5, 2015. 2015. 24 Muhammad Amir Rana, “Economic corridor challenges,” Dawn, May17, 2015.

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