Pakistan

Reviving the Old Silk Road with China, Pakistan and Iran

Aisha Saeed

Aisha Saeed

The world seems to be readying for major geostrategic and geopolitical realignments that could set the stage for the revival of an ancient trade route connecting East and West.

Chinese President Xi Jinping’s landmark Belt and Road Initiative (BRI) – a massive transatlantic infrastructure development project along the old Silk Road route connecting nearly 70 countries of the world through land, railways and maritime networks – is pivot to those prospective realignments one of which should link up China with South Asia, Persian Gulf and beyond.

For centuries, Iran served as a bridge between the West and East in the ancient Silk Road route due to its strategic significance and Beijing still deems Tehran as a key element for the revival of that route through BRI.

And with the announcement of a recent deal of a $400 billion trade and military partnership with Iran, China appears to have taken a giant step towards resurrecting that trade route.

Battered by U.S.-led international sanctions in the wake of its nuclear program and support for its proxies like Hezbollah in the volatile Middle East region, Iran adopted the “Look East” policy under Mahmoud Ahmadinejad who preceded current President Hasan Rouhani.

China warmly responded to Iran’s gesture and signed a treaty in 2008 that allowed the Iranian government to use its revenue of the oil sale as credit for the purchase of Chinese goods, for energy infrastructure development as well as purchase of sensitive technology. 

In 2016, Rouhani and China’s Xi signed nearly a dozen and half agreements to boost bilateral economic and commercial ties.

Under these agreements, China would build two nuclear power plants in southern Iran and in turn Iran would provide long-term oil supplies to China. The 10-year agreement would increase the total value of trade between the two countries to $600 billion, giving Iran the badly needed economic relief.

The BRI envisages a series of trade and energy projects in proximity of the Persian Gulf where Iran is located.

China Pakistan Economic Corridor, commonly known as CPEC, is the flagship project for BRI in which strategically Gwadar port in Pakistan’s Baluchistan province bordering Iran and Afghanistan would become hub of transregional trade.

With CPEC in full-swing, China’s attention shifted to Iran and its Chahbahar port, just at a distance of 70 kilometers from Gwadar, making it the next phase for the Belt and Road Initiative.

Chabahar Port

For China, Iran and Pakistan hold an increasingly significant role in giving China access to the “oceanic highway” of the world’s economy. While Pakistan was highly receptive to the idea of CPEC, Iran was slow in recognizing economic, strategic and security significance of the project.

Due to the volatile situation in Afghanistan, China’s access to the Central Asia as well as to the Middle East and Persian Gulf was circumvented. Moreover, Iran’s agreement with India for the development of Chahbahar had further dimmed prospects for China’s access to these energy rich regions.

However, Iran’s decision to drop India from a key rail project at Chahbahar because of delayed finances and then Iran-China strategic partnership deal for 25 years have raised the prospect of Beijing’s involvement in the Iranian port development and its ultimate link up with Gwadar, which was also developed and operated by China.

China’s economic and strategic aims hence converge between the ports of Pakistan and Iran that provide the promising and safest routes to the larger part of the globe. China’s involvement in both deep sea port projects would also nullify the Indian-driven negative hype that both ports are rivals rather their inclusion in BRI means that they would supplement each other. 

For this reason, without the Iranian participation the success of China’s BRI project specifically from a geopolitical perspective would have never become a possibility. The constructive and patient approach towards Iran resulted in Tehran’s willingness to participate in China’s expanding clout in the region.  Moreover, U.S. unmitigated animosity with Iran provided a room for China to maneuver to find a firm foothold in the strategic Persian Gulf region.

Undoubtedly, the Belt and Road Initiative with its CPEC project created new opportunities for China and Pakistan.  The allies share corresponding political as well as economic interests as the foundation of their strength.

The implication of China- Iran deal only opens a bigger window for Pakistan in terms of security, trade, energy and diplomacy. CPEC shall remain the flagship project of the Belt and Road Initiative as both China and Pakistan are correspondingly ardent in sustaining the project for the years to come.  Pakistan provides a unique corridor of not only internal import and export but also as an extension for existing projects.

Despite China gaining access to Chabahar , Gwadar’s  strategic significance as China’s safe route to keep BRI operational would remain unchanged. Pakistan’s bilateral relation with Iran can further be mended due to China’s interest in Iran. Moreover, China’s replacement with India in Iranian economic and infrastructure projects would remove a major security headache for Pakistan and would create a space for Islamabad to foster better ties with its western neighbor.

Courtesy CPEC, Pakistan’s potential to become a transit country is an undiscovered aspect of the China- Iran deal.  Pakistan can still become a transit country by creating a CPI (China- Pakistan-Iran) energy corridor. Through CPEC Pakistan can increase its energy sources, diversify its transport routes and overcome its energy shortages.

Moreover, as a cross-border energy country, Pakistan can manage transit costs to help the country maintain the energy corridor.

For Pakistan, the deal also presents a decent opportunity to explore the least discussed access into far Africa and Central Asia.

With the active support of China, Pakistan should bolster its economic and commercial ties with Iran and act as a bridge between Beijing and Tehran. Such kind of relationship would also help mitigate Pakistan’s security concerns caused by non-state actors operating in the border region between Pakistan and Iran. Moreover, it could also help improve security situation in Baluchistan which has been scene of deadly attacks perpetrated by Indian-sponsored militants using Iran as launching pad for these attacks. If chalked out thoughtfully, Pakistan can effectively counter and eliminate anti- Pakistan elements present in the border regions of Iran.

The abandoned Iran –Pakistan gas pipeline project holds immense potential but threats from state and non-state actors have derailed the project. With the improvement of ties with Iran and presence of a major world power like China, this project could be revived.

The Iran- China deal has brightened the prospects for an improved security environment in the region. Pakistan now must work on developing a regional security network to enhance security cooperation with the countries involved in CPEC and the BRI.

Aisha Saeed is an independent analyst on media and foreign policy of Pakistan. She tweets @MsAishaK.

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