The China-Pakistan Economic Corridor (CPEC), a flagship project under China’s Belt and Road Initiative (BRI), has been a cornerstone of the Pakistan-China relationship since its inception in 2013. With the introduction of CPEC 2.0, this partnership has entered a new phase, bringing both opportunities and challenges that could reshape Pakistan’s economic landscape and its strategic ties with China.
CPEC 1.0 focused on infrastructure development, energy projects, and establishing Special Economic Zones (SEZs). The $62 billion initiative addressed Pakistan’s energy deficit, modernized its transportation network, and stimulated industrial growth. By 2021, several projects were completed, including the Gwadar Port, various power plants, and road networks that enhanced connectivity between China and Pakistan.
These projects have brought tangible benefits, such as alleviating Pakistan’s energy crisis and improving transportation infrastructure. However, they also generated concerns about debt sustainability, environmental impact, and the uneven distribution of benefits across different regions of Pakistan. Despite these challenges, CPEC has remained a symbol of the strong bilateral relationship between Pakistan and China.
CPEC 2.0 represents a strategic shift from infrastructure development to industrialization, agriculture, socio-economic development, and digital connectivity. The focus is now on enhancing Pakistan’s industrial capacity, improving its agricultural output, and integrating its economy more deeply with China’s.
This phase is particularly important for Pakistan, as it seeks to address its economic challenges, including a balance of payments crisis, low industrial productivity, and a stagnant agricultural sector. By leveraging........