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CPEC: Opportunity for Iran and Pakistan

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Historically, Iran and Pakistan enjoyed friendly relations and this relationship has noticeably improved in the recent years. The two countries have been successful in harmonizing their differences over Afghanistan where they have no more to enter into contestation, given Iran’s reconciliation with the Taliban and the two countries’ common threat perceptions over the rise of the Islamic State in the ‘AfPak’ region.Pakistan’s regional posture is India-centric, while Prime Minister Narendra Modi has also enunciated on several occasions a policy of encircling and isolating Pakistan regionally and internationally. Along those lines, India has substantially increased its influence in Afghanistan, and it has recently, too, started stepping up its engagement with Iran. Meanwhile, Pakistan, instead of countering Indian engagement in Iran, is directing its ire at Iran itself. This has further alienated Tehran, which has its own interests to pursue.

As per 2013 Pew Poll found that 69 per cent of Pakistanis had a favourable view of Iran, the highest percentage of 39 countries polled worldwide on perceptions of the Islamic Republic. According to a survey, conducted by the Pakistan Institute of Peace in 2013, political and religious parties in Pakistan hold on to the notion that Pakistan’s ties with Iran should not be determined by the fears of upsetting the US but need to be based on Pakistan’s own national interest. It will not only improve relations with Iran, but also promote security, economic cooperation and, sectarian harmony. According to a report by the International Monetary Fund (IMF) in 2013, while Pakistan ranked as the 11th largest trading partner of Iran, trade between the two countries has been well below its true potential despite geography and the infrastructure available under the Economic Organization Cooperation (ECO) framework. There is, however, a high volume of trade between the two countries through third country channels, smuggling and other illegal modes of financial transactions, mainly because of the western imposed sanctions on Iran, and the threats of penalties on the countries doing business with Iran.

Covering a land area of 1,648,195 km2 (636,372 sq mi), Iran is the second-largest country in the Middle East and the 18th-largest in the world. With 78.4 million inhabitants, Iran is the world’s 17th-most-populous country. It is the only country with both a Caspian Sea and an Indian Ocean coastline The country’s central location in Eurasia and Western Asia, and its proximity to the Strait of Hormuz, makes it of great geostrategic importance. Iran is heir to one of the world’s oldest civilizations, beginning with the formation of the Proto-Elamite and Elamite kingdoms in 3200–2800 BC. The area was first unified by the Iranian Medes in 625 BC, who became the dominant cultural and political power in the region.It is important to note that Tehran is very closely watching the realignments taking place in the region as well as at the international levels to assess its future plan of action. With a new block emerging in the region, Iran is fast shifting its weight towards China. Iran can join this coalition which aspires to keep the region peaceful and economically vibrant.

Iran, situated astride the Persian Gulf, Gulf of Oman and Caspian Sea, has Pakistan, Armenia, Afghanistan, Iraq, Azerbaijan, Turkmenistan and Turkey as its neighboring states. Being an energy abundant country, exports petroleum, cement, chemical products, carpets and fruits and imports capital goods, consumer goods, Industrial supplies and technical services. Iran’s trading partners include China, Japan, India, Turkey, South Korea and UAE. Initially opposing Gwadar as a perceived economic threat to Chahbahar, Tehran has recently shown its inclination to participate in CPEC with an intent to enhance land connectivity for trade purposes. With Iran’s positive disposition towards CPEC the erstwhile Iran-Pakistan-India (IPI) pipeline could be rechristened as Iran-Pakistan-China (IPC) Pipeline. Iran’s participation in the Project is likely to go a long way in bringing stability to the region, particularly Afghanistan. A train link connecting Pakistan, Iran and Turkey78 will not only strengthen Pakistan-Iran-Turkey partnership but would also ensure a safe trade route from South-Asia to Middle East and from Turkey right into Europe.

The willingness shown recently by President Rouhani to join with the world’s economic giant through CPEC is actually not linked to benefit economically but also the strategic significance of this new emerging alliance is also being taken care of.The bottom line is that both Iran and Pakistan regard China as a bulwark against US hegemony. The CPEC also brings in an economic dimension.Moving on, Iran’s inclusion in CPEC will help Pakistan in a number of ways. One, Iran’s re-entry into the active international fold after the recent lifting of sanctions bodes well for Islamabad. For Iran, there’s no looking back. Trade and economic representatives from all over the world are scrambling to Tehran to woo Iran to do business with them. Analysts are predicting a turnaround of fortunes for the Iranians as well as transformation of the oil market mechanistic dynamics.

For Pakistan, Iran’s resurgence is nothing but good news, especially as far as the long-forgotten Iran-Pakistan pipeline project is concerned. There is now a reason to believe that some progress will be made in the changed set of circumstances.Before Iran was hit by international sanctions, bilateral trade between with Pakistan was around $1.6 billion annually. After the economy-crippling sanctions were imposed, Pak-Iran bilateral trade was reduced to around $300 million. Now that the West lifted its sanctions against Iran due to the nuclear deal reached in 2015, the Iranian economy and, consequently, Pak-Iran bilateral trade, are slowly recovering.

Having said that trade and energy cooperation between Pakistan and Iran can be increased through the revival of the Iran-Pakistan gas pipeline. The gas pipeline could meet 25 per cent of Pakistan’s energy needs. The total cost of the project is estimated at US$7.50 billion with the cost, on the Pakistani side, of about US$1.25 billion. The project would supply 750 mcft daily through its 1700 km length, and it is estimated that at least 5000 MW of electricity could be generated through the use of Iranian gas. The pipeline can also become a part of the larger China-Pakistan Economic Corridor initiative;.According to South Asia analyst Michael Kugelman, “Iran may have concerns about Gwadar from a geopolitical standpoint, given that Gwadar and the broader pattern of Chinese investment in Pakistan is a competitor to the India-led transport infrastructure project that centers around the port of Chabahar in Iran. Based on scale and amount of investment, the Chinese investments in Pakistan are more formidable than India’s in Iran.” Kugelman continues, “At the same time, Gwadar could have benefits for Iran. China has suggested its broader CPEC project in Pakistan could include financing the Pakistani side of a new gas pipeline from Iran. Also, China’s massive investments in Pakistan could merely be the precursor to broader Chinese regional infrastructure investments, including in Iran. Who knows – we could even see the Chinese making some contributions to Chabahar. Anything is possible.”

Pakistan is especially interested in improving and coordinating its economic relations with Iran. With the lifting of the international sanctions on Iran, all legal hurdles of doing trade with Iran have now been removed. This will give a boost to economic relations between the two countries and both the countries would no longer have to rely on indirect trade. While economic relations will be the major focus of future relations, there will be many foreign policy issues that will impact such relations. Of particular concern would be China’s efforts to develop the China-Pakistan Economic Corridor (CPEC), and Iran’s growing relations with India.

The mounting ties between China and Iran is an important factor that needs to be weighed by the leadership in Pakistan to immediately take necessary steps to ensure a trilateral cooperation among Pakistan, Iran and China. There is an added factor to push this kind of cooperation forward. During a visit to Iran by Chinese President Xi Jinping in January 2016, both Iran and China signed a US$600 billion trade deal. Both agreed to expand multidimensional ties and increase bilateral trade more than tenfold in the next decade. The two countries signed seventeen accords including agreements on cooperation in nuclear energy to become a part of China’s One Belt, One Road‟ initiative.

For Iran, the corridor would provide the  country with much  required openness to the  east. In  addition, Iran‘s  entrance in  this venture would  lead  to  an  era  of  improved  economic  development  across  the  Sistan-Baluchistan  province  by enhancing trade  between Pakistan,  China, and Iran  and would  offer a  cost-effective gateway to  the Gulf region for states like Russia and India. Presently, the need for Pakistan is to take into account the concerns of Iran especially if  Pakistan  wants to balance India‘s  influence  in the region and  wishes to fulfill the old dream of Iran-Pakistan gas pipeline. iran must look forward to the removal of non-tariff barriers and Pakistan must set mechanism to purchase oil from Iran instead of going miles away. Strategic importance of Gawadar does haunt neighboring countries but Pakistan has to mainstream this right strategic narrative of cooperation for greater good of both countries. Pakistan as friendly gesture could lay modes of connectivity between Chabahar and Gawadar.

Islamabad based freelance contributor and researcher. His area of research is south Asia special focus on china India relations.

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South Asia

Will Pakistan go to IMF finally?

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International Monetary Fund (IMF) was created just after World War II (WWII) in 1945. It was the time of re-organization of the world order after massive destruction of WWII. UN and its organizations were establishing and whole world was passing through reforms. The IMF is an organization of 189 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.

The beneficiary of WWII was US, and emerged as leader of World. IMF and World Bank like other UN and International organizations were depending on US funding to some extend and US has been utilizing in expand its economic, political and military influence around the world, frequently. US was involved in appointing head of such organizations directly or indirectly.  I leave it to my readers to judge that if IMF and other organizations have achieved its objectives or not?

Pakistan have been knocking doors of IMF since 1958, and it has been 21 agreement with IMF. Generally, IMF provides loans at very low interest rates, and provides programmes of better governance and monitoring too. But for last 6 decades, Pakistan has suffered a lot, in term of good governance. Especially last 2 decades, corruption, nepotism, poor planning, bribery, weakening of institution, de-moralization of society, etc were witnessed. We may not blame IMF for all such evils, but must complain that IMF failed to deliver, what was expected. Of course, it is our country, we are responsible for all evils, and wrong doings happened to us. We have to act smartly and should have made right decision and on right times.

In fact, beneficiary of corruption, is west, and in some of the cases, west has inspired or protected the corrupt politicians and bureaucrats in the developing nation and Pakistan is no exception to it. At least, IMF failed to monitor the utilization of funds provided.

IMF also dictates its terms and condition or programmes like: devaluation of local currencies, which causes inflation and hike in prices, cut or draw-back of subsidies on basic utilities like fuel, gas, electricity etc, which causes cost of life rather higher for local people, cut on development expenditures like education, health, infrastructure, and social development etc, which pushes the country backward.

Pakistan was no exception to it in the history of our relations with IMF. Last couple of decades, we could not develop our infrastructure, as a result we are back ward and could not take off economically, could not built Dams and suffering from Power shortage and water crisis, Education, health and social sector was ignored and pushed us rather backward.

In past, whenever we approached IMF, US administration was favoring us, but this time, it was witnessed that US may create hurdles or resistance in the form of additional conditions etc.

Based on experience of 6 decades, Government of Pakistan (GoP) have to make decision, weather to go to IMF or not? It is very serious issue and very sensitive decision. GoP is very serious and in close consultations with various experts from within the government and out side the government. There is a group in Pakistan, lobbying for IMF, as it is cheapest and more structured. Pro-IMF lobbies are more close to PM Imran Khan. While, there are experts who are against IMF and feels in past, if IMF was not helpful for Pakistan, then why to go again for the same tested organization. It is worth mentioning that, Pakistan is a diversified nation, and freedom of expression is ensured by constitution of Pakistan, so many controversial opinions are expected – we enjoy the highest degree of freedom. .

In past, politicians were rather easy to coerce and IMF was successful in their missions. But, today, Pakistan is in safe hands and current leadership is honest, loyal and sincere with Pakistan. The PM Imran Khan is a strong man and will take decision based on principles in the best interest of nation.  Sources close to him, feels that till date he is not convince yet, but will take a firm decision soon. His decision will be based on expert advice, national interest and purely merit-based.

However, all other option may be explored and taped, like friendly nations have already extended a hand of financial assistance. Like Saudi Arabia, Arab Emirates, Qatar, Turkey, Malaysia and China. Which has lessen the need of going to IMF to a great extent. It will provide an edge to Pakistan, while negotiating with IMF.

Whatever will be his decision, people of Pakistan trust him and will stand behind him. His decision will be considered the decision of 220 million of Pakistan. Pakistan has a history of “No Default” in last 7 decades to any one of our international obligation or agreement. Pakistan is a civilized, disciplined and matured & resilient nation. We have passed many harsh tests, in last 4 decades and learnt many lessons.

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Pakistan Securing Its Maritime Interest and CPEC

Qura tul ain Hafeez

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The IOR is a major sea route that unites the Middle East, Africa, and East Asia with Europe and America. The excessive economic growth of littoral states of Indian Ocean obliges them to protect their energy needs and interests in order to endure their purchasing power. This has great security implications for the sea line of communication of the littoral states of IOR like Pakistan.

Continuing to Pakistan’s interests in IOR the China-Pakistan Economic Corridor has great potential to transmute Pakistan into a central trade platform, which would undeniably gushed the enemies, particularly India, to halt it. The development of Gwadar sea-ports as part of BRI in general  and that of CPEC in particular has amplified India’s concerns’ and aimed for more sophisticated and advanced naval build-up. Furthermore, India perceives the Gawadar port (that is considered as crown jewel of CPEC) as a hazard to its contesting interests in Central Asia countries.  The reason being, India can access Afghanistan, Iran and Central Asian Republics (CARs) only through Cahabahar by passing Pakistan and Gawadar  a deep water sea port that is easily accessible to these land locked states then Chahabahr. A couple of days back on 24th December 2018 India has formally over taken the operational control of Iran’s Cahabahar port – only (0 Km away from Gawadar port. India’s aspirations to become blue water navy in the IOR raise serious concerns among Pakistan’s maritime security. CPEC would lead toward increased maritime politics and contestations not only between Pakistan and India but would also involve China and US.

In such turbulent circumstances Pakistan is required to prepare its sea based defense to secure its sea lines.   Islamabad needs to carefully evaluate its options and develop its strategic response accordingly, involving but not limited to continuous development of its naval capability and an even closer maritime cooperation with China. In view of the prevailing power dynamics in Indian Ocean Pakistan Navyin order to secure its interest in IOR inked a contract with China’s State Shipbuilding Corporation (CSSC)in June 2018 for two, Type 054AP frigates. The agreement is an extension of a previously signed agreement in 2017. Recently on December 19, 2018 steel-cutting ceremony for the second Type 054A frigate for the Pakistan Navy was held at the Hudong-Zhonghua shipyard in Shanghai. The type 054 AP warship frigates will be equipped with modern detection-state of art sensor and Guided Missiles weapon systems; capable of anti-ship, anti-submarine and air-defense operations. According to the report of China Daily report added that the “Type 054A is the best frigate in service with the PLAN”.

It is pertinent to mention here that maritime security is linked with the Economic security and vice versa. Gawader port is one of the most important projects of the CPEC where Pakistan and China are very hopeful that in future this shipping port will generate the revenue for Pakistan’s economy.  There is a big chunk of fishery industry through which Pakistan can earn a lot. It will stimulate business and trade activities at state level and across the region.  The 054 AP frigates ““Will be one of the largest and most technologically advanced platforms of the Pakistani Navy and strengthen the country’s capability to respond to future challenges, maintain peace and stability and the balance of power in the Indian Ocean region” a report on 2nd January 2019 released by  Chinese state owned media said.

In some, to deal with all these existing defies Pakistan Navy (PN) has espoused to a multi divided line of action for safeguarding the port in more effective manners. It conducts security patrolling h and coastal exercises from time to time. Furthermore, previously in 2013 it has inaugurated its Joint Maritime Information Coordination Center (JMICC) in Karachi to provide with an effective mechanism of Maritime Domain Awareness (MDA).  After receiving these 054 AP frigates warship Pakistan will definitely in far more better position to counter India’s vested interests in Indian Ocean region. It will also help secure the Gwadar port which is the chief component of Pakistan maritime trade activities. China has always been an al weather strategic partner of Pakistan. Although India always tries to propagate that CPEC is military agreement instead of an economic one however, securing the economic interests with an advanced mechanism does not mean at all that it’s planning something militarily. Pakistan has always adopted a defensive policy and it is the right of every sovereign state to secure its interests even if they are economic as there is no morality in international politics, still CPEC is an economic project which welcomes every state of the region for economic cooperation  even if it is India as well.

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2018 was the deadliest year in the history of Kashmir

Irfan Khan

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Kashmir is natural paradise and gorgeous valley located between Pakistan, India, Afghanistan, China and with a small strip of 27 miles with Tajikistan and Kyrgyzstan. But it is still a disputed region since partition of United India into India and Pakistan (also Bangladesh in 1971) in 1947.

The history of the freedom of Kashmir dates to 1931 when the people, both Hindus and Muslims, initiated a freedom movement against the then Maharaja (ruler) to have their own indigenous rule. The resentment of the people led to the ‘Quit Kashmir’ campaign against the Maharaja in 1946. Faced with the insurgency of his people, the Maharaja fled the capital, Srinagar, on October 25, 1947 and arranged that India send its army to help him crush the rebellion. India, coveting the territory, set the condition that Maharaja must sign an ‘Instrument of Accession’ to India. At the same time, India had to attach another condition that accession was made subject to ‘reference to the people.’ On India’s showing, therefore, the accession has a provisional character.

Then India brought the dispute to the United Nations where the Security Council discussed the question exhaustively from January to April 1948. Then both India and Pakistan and approved by the international community that the dispute over the status of Jammu and Kashmir can be settled only in accordance with the will of the people which can be ascertained through the democratic method of a free and impartial Kashmiri citizens vote.

The people of Kashmir, despite of being injured since long could not lost their hope. They believe in United Nation(UN), assuming it will advocate choice of freedom for them. During the July-August 2018, people from entire Srinagar and other towns, were protesting government of India’s violation of Article 35-A of Indian’s constitution. 35-A, assure special rights to the state of Jammu and Kashmir.

Whenever, there is peaceful demonstration from them, then they must suffer basic human rights violation, fear and state of starvation as response of Indian government. In 2018, 111 civilians are killed which is double to the previous year recorded 40 killing by the Indian forces. India has some 500,000 troops deployed in Kashmir. Popular unrest has been rising since 2016 when a charismatic young Kashmiri leader, Burhan Wani, was shot dead by Indian forces.

Pakistan always has been bolstering the way of peaceful talk with India over the issue. Last year, in October, Prime Minister Imran Khan, repeated Pakistan’s stance that the solution to the region’s dispute laid in dialogue. He said,”It is time India realised that it must move to resolve the Kashmir dispute through dialogue in accordance with the UN SC resolutions and the wishes of the Kashmiri people”.

Kashmiri leader Mirwaiz Umar Farooq, in response to PM Khan said we welcomed “Pakistan’s concern” but called for Pakistan to “do much more” to “put an end to the appalling grind of repression and human rights abuse that Kashmiris are suffering at the hands of Indian state.

Happily, UN has issued human right report on Kashmir in June 2018. The report of 49 pages strongly emphasis on human right violation and abuses and delivering justice for all Kashmiris. UN High Commissioner for Human Rights Zeid Ra’ad Al Hussein remarked “The political dimensions of the dispute between India and Pakistan have long been centre-stage, but this is not a conflict frozen in time. It is a conflict that has robbed millions of their basic human rights and continues to this day to inflict untold suffering. Therefore, any resolution of the political situation in Kashmir must entail a commitment to end the cycles of violence and ensure accountability for past and current violations and abuses by all parties and provide redress for victims”.

2018 was the deadliest year in the history of Kashmir. Hope so, Pakistan and India sandwiched by UN would resolve the issue based on Kashmir people’s choice of freedom so that human violation could be ceased.

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