On March 24, Chinese Foreign Minister Wang Yi met Afghanistan’s Acting Foreign Minister Amir Khan Muttaqi and Acting Deputy Prime Minister Abdul Ghani Baradar during a visit to Kabul.

“Beijing welcomes Afghanistan’s active participation in the Belt and Road Initiative, a global infrastructure plan proposed by China, and is willing to push for extending the China-Pakistan Economic Corridor (CPEC) to Afghanistan. China is willing to promote the extension of the CPEC to Afghanistan, making the latter a bridge for regional connectivity,” Wang said during the visit.

CPEC was launched in 2015 as part of China’s Belt and Road Initiative (BRI). Economic corridors are essentially agreements that regulate trade relations across the region. The Silk Route is historically the oldest economic corridor in the world. The BRI has been dubbed as the ‘new Silk Route’ and aims to connect Chinese market and investment with Asia, Europe, the Americas and Africa. The African countries and companies have already registered their interest in trans-regional trade cooperation with Chinese companies that constructed Special Economic Zones (SEZs) to promote agricultural and industrial exchange.

The value of SEZs has increased over the last 30 years. As per International Labour Office’s estimates, there were around 176 SEZs in 47 countries in 1986. The number had increased to 3,500 in 130 countries in 2006. In the following year, the Word Bank put the number of the SEZs at 4,300 globally.

Despite the prevalence of the said economic activity parks, the world did not witness any major development-oriented economic corridors receiving significant governmental, corporate and media attention. This changed with the BRI which has received extraordinary attention from all circles since its launch in 2013.

The CPEC was formalised in 2015 during President Xi Jinping’s state visit to Pakistan. The bilateral economic corridor aims at connecting Gwadar to Kashgar through a network of roads, railways and telecommunication infrastructure. Operationally, the CPEC was divided into two phases. In the first phase, usually called the “early harvest” phase, the focus remained on infrastructure development and access to energy. In the second and third phase, detailed in the Long Term Plan for CPEC (2017-2030), industrial cooperation through the construction of nine Special Economic Zones along with agricultural development and tourism promotion are prioritised.

Given the context, Wang Yi’s Kabul visit holds special significance. Among other things, the BRI was projected as a means to realise economic cooperation, market connectivity, poverty alleviation, growth in agriculture and industrial development in Afghanistan. 

A number of early harvest projects have been completed in the last six years. Work on the SEZs is under way. Four of the nine SEZs are under construction; the remaining five are in the pipe-line. As far as Gwadar projects are concerned, three projects have been completed, seven are under construction and four are in the pipeline.

In other words, the CPEC has not been abandoned as is sometimes suggested although progress on certain projects has been slow.

Owing largely to the CPEC, China-Pakistan trade cooperation has strengthened. Bilateral trade has increased with the initiation and progression of the CPEC. The volume of bilateral trade that stood at $9.2 billion 2010 and $17 billion in 2014, had reached $27.82 billion in 2021.

China has remained the dominant partner in bilateral trade. Exports from Pakistan are increasing incrementally. Pakistan’s exports to China increased 68.9 percent to the tune of $3.58 billion in 2021 according to the data released by the General Administration of Customs of China (GACC). In addition, the CPEC has generated employment opportunities. More than 100,000 Pakistanis were employed in various projects in the first phase. The number is expected to rise.

Regionally, the CPEC carries structural potential to generate economic opportunities and boost economic activity in West Asia including Saudi Arabia, Qatar and the United Arab Emirate. These are countries with which both China and Pakistan have maintained strong state-level relations. These Gulf countries have already joined China’s BRI programme and recently Saudi Arabia and the UAE have hinted at joining the CPEC too.

Importantly, Iran has recently signed a $400 billion deal with Beijing. Moreover, Central Asian countries are pursing various economic goals under the BRI. Indeed, the very concept of the Belt and Road Initiative was floated by Chinese President Xi Jinping at Nazarbayev University at Astana in Kazakhstan in September 2013.

China and Pakistan have shown keen interest in Afghanistan which borders the two. Being war-ravaged and poverty-stricken, Afghanistan needs urgent economic assistance to mitigate the current humanitarian crisis.

Given the context, Wang Yi’s Kabul visit holds special significance. Among other things, the CPEC was projected as a means to realise economic cooperation, market connectivity, poverty alleviation, growth in agriculture and industrial development in Afghanistan.

The CPEC-BRI is an economic opportunity for regional countries. They should reap the benefits of the Chinese vision of mutually beneficial cooperation. CPEC’s extension to Afghanistan and Iran should be seen in rational terms (cost-benefit analysis). With a sizeable market and plenty of natural resources Afghanistan can quickly increase its trade with both Pakistan and China.

The writer has a PhD in political science from Heidelberg University and a post-doc from UC-Berkeley. He is a DAAD, FDDI and Fulbright fellow and an associate professor at the Department of Social Sciences, Iqra University, Islamabad. He tweets @ejazbhatty