2021 marks 70 years of the establishment of formal diplomatic relations between Pakistan and the People’s Republic of China. In 1951, Pakistan became the first non-communist country to establish diplomatic relations with the newly established People’s Republic. The relationship has endured the test of time, strengthening and diversifying in due course to culminate into the most distinguishable status of “iron brothers”.

The relationship, often described as “higher than Himalayas, deeper than oceans, sweeter than honey, and stronger than steel”, entered a new phase in 2013. This was when Pakistan became the destination for the flagship project of Chinese President Xi Jinping’s signature foreign policy move, the Belt and Road Initiative (BRI). Connecting Xinjiang in western China to Pakistan’s port city of Gwadar, China Pakistan Economic Corridor (CPEC), the BRI flagship, has emerged as an economic lifeline.

Besides over-land connectivity, which would be achieved via a network of highways and railway lines, the plan includes an assortment of energy projects, industrial parks, and digital connectivity, making Pakistan an essential part of China’s avant-garde Digital Silk Road. This will, in turn, further strengthen the multi-dimensional cooperation between China and Pakistan in agriculture, information technology, education and defence.

The US-led invasion of Afghanistan after 9/11 had left a dark shadow over Pakistan’s economy and political dispensation. The Afghan War spillover was turning Pakistan into one of the world’s most volatile places. As the security situation deteriorated, the already fragile economy was the primary victim. According to conservative estimates, Pakistan lost at least $150 billion in terms of economic opportunities not counting the damage to infrastructure and global reputation. This pushed the country further into a whirlpool of precariousness.

The CPEC promised a minimum of $46 billion investment in Pakistan as well as some concessional loans. The volume of investments subsequently increased to more than $ 60 billion and is likely to increase further over the coming years.

The infrastructure development in Pakistan has undergone a massive transformation since the launch of the CPEC. The road connectivity has improved significantly; the railway network is not only being restored but new railway lines are also being laid. These initiatives are helping the industry, businesses, tourism, agriculture and education. The highway network has been expanded to several areas that were previously served by substandard carriageways. This has allowed the authorities to take groundbreaking measures for poverty alleviation and uplift of previously underprivileged areas.

Pakistan faced the worst energy crisis of its history during 2005-15. This led to a downward spiral for many industrial sectors, severely impinging upon the country’s economic progress. Energy projects commissioned and planned under the CPEC have completely changed the situation. Several projects have already been completed and more are expected to be completed within the next few years. This will be instrumental in not only addressing household energy needs but also in expanding the industrial base.

22 energy and power projects are being executed under the CPEC. Nine of the energy and power projects have been completed adding an installed capacity of 5,340 MW to the national grid. This is helping the country meet the essential needs of industry, agriculture and domestic consumers. Another eight projects, designed to add 4,470 MW of installed capacity, will be completed soon. Five more projects are in the planning phase.

The CPEC has had its fair share of problems in the implementation and execution processes. There are lessons to be learnt. The problems have ranged from land acquisition issues for energy and infrastructure projects to simplifying taxation on machinery imports. There have also been issues in transparency and accountability one hand and in ensuring adequate coordination among federating units and the Centre

Owing to the post-9/11 havoc and the energy crisis, the industrial base in Pakistan had suffered major setbacks with investments plunging to extreme lows. This had led to important industries shifting operations to other countries. The CPEC is expected to change this trend. At least nine industrial parks are planned as part of the CPEC. Following the Chinese model, investors would be offered special incentives in these zones to contribute towards enhancing the industrial production. This is expected to not only speed up the economic progress but be helpful also in addressing the pressing issue of rising unemployment. A couple of these special economic zones are expected to be inaugurated this year during an anticipated high-profile visit of senior Chinese dignitaries to Pakistan.

Communications, energy and industry are not the only sectors in Pakistan expected to undergo change owing to the CPEC. The current government has proposed an expansion in the CPEC scope to include agriculture, poverty alleviation and information technology. This can change the CPEC outlook from a socio-economic venture to a futuristic enterprise aiming at improving the living standards of people and setting the stage for a prosperous Pakistan.

The writer is an Islamabad based international relations expert.