BACKGROUND: Pakistan and China signed the deal to build the $248 million deep-sea port on the Arabian Sea coast in Southern Baluchistan in 2002. The project was to be completed by March 2005. China provided $198 million in a mixture of soft loans and grants; Islamabad is paying the remaining 50 million. The mega-project to build Gwadar seaport was inaugurated in April 2002. The location of Gwadar is strategically significant, as it is just on the opposite end of the Gulf of Oman and the Straits of Hormuz. Pakistan’s National Highway (NHA) and the frontier Works Organization (FWO) are tasked to build a 700 km coastal superhighway, which would link Gwadar with the world. This highway will link Karachi on the east to Jiwani to the west, near the Iranian border. It is estimated that this highway will most likely be completed along with the Gwadar port. According to many analysts, this deep sea port project has the potential to reshape regional trade by creating a new trans-shipment facility on the Arabian sea. Pakistan’s Prime Minister Zafarullah Khan Jamali paid the area an official visit last May. During this visit he said: \"The development of the deep sea port of Gwadar is a link between east and the west and it will change the fate of this region as well as the national economy of Pakistan … and will make this area an important junction in the international trade\". The port, 675 km west of Karachi, is now under construction. Engineers from the China Harbor Company claim that in keeping with the pace of work, they will complete phase one by September 2004. The Gwadar deep-water channel, which is more than 14 km long, will permit large vessels to anchor and some experts argue that it will eventually outsmart and overcome other transit ports in the region. Gwadar will most likely provide an alternative trans-shipment facility not only for the westbound but for eastbound cargoes and oil shipments as well, which at the moment start off from Dubai or Salalah ports. Also underway is a master plan for the development of the area. This plan includes a modern airport, an elaborate network of roads linking Gwadar with the country’s main cities in the east and the north, a tax free export processing zone and an industrial estate. A highway connecting the port with the central Asian states is also under construction. Earlier in 2003, the Asian Development Bank made a commitment to lend up to $500 million for regional roads. If the vision of the people at the helm in Islamabad and the Chinese builders is realized, in every likelihood, it will be transformed into a futuristic gateway for trade to the landlocked central Asia.

IMPLICATIONS: Phase one of the mega-project will likely finish in September 2004, almost six moths ahead of schedule. According to one senior engineer of the China Harbour Comapany, Mr. Xia Yubin, the work is progressing smoothly: “We will finish our work in 2004”, he stated. During this first phase, three multipurpose berths to accommodate ships of over 50,000 tons will be created. In the second phase which will start immediately after the completion of the first phase, two container berths, a bulk cargo terminal, a grain terminal, a roll on-roll off terminal. Two oil piers will be built and the future expansion of two berths will also take place. China is Pakistan’s partner in the creation and development of the Gwadar port since day one. Apart from being the “all-weather friend” of Pakistan, China is also interested in the development of Gwadar due to its own economic interests. This port, once it materializes, will have a very positive impact on Chinese economy – especially the economy of the Chinese Autonomous region of Xinjiang. The much shorter distance between Gwadar and this part of China as compared to its other seaports makes it a very important project, which can be used for enhancing the economic activity in this region that has suffered from separatist movements. Chinese participation and contribution in phase one of this project has created keen interest and attracted investments not only from Pakistani entrepreneurs. Many countries, particularly Afghanistan, Singapore and Japan have shown keen interest in the developments taking place in this part of the region. Much importance rests on connecting Gwadar with the rest of the country through road and railway connections. It has been reported that Gwadar will be connected with a rail network on the Quetta-Zahedan line at Dalbandin, or with the Dodu-Jacobabad section. The Chaman-Quetta rail tract could also be upgraded to handle the activities of the Gwadar port. The highway that will connect Gwadar with the rest of the country is also nearing completion. Work is going on at full speed on the Karachi-Gwadar Coastal Highway. It has been reported that the Karachi-Ormera section is almost complete and more than half of the Gwadar-Pasni Section has been built. Observers and experts say that work on the Pasni-Ormera section is due to begin soon. This highway is estimated to become operational three months ahead of schedule, in the last quarter of 2004, close to the completion of phase one of the Gwadar port. According to many analysts, this will reduce the traveling time for a truck between Karachi and Gwadar significantly. An important incentive is that it will be possible to unload cargo from a ship directly onto a long distance truck, which could reach Chaman on the Pakistan-Afghan border in just eight hours by road – a road that is already under construction through the financial support of the Asian Development Bank. By the end of this year, Gwadar airport will also be fully developed. The new runway will be capable of handling the landing of 747 aircrafts, and Airbus compatibility. Pakistan’s Finance Minister Mr. Shaukat Aziz once said that this is a long-term project and at this stage only the first phase of the developments with the minimal infrastructure support is being built. The full potential of this project can only be realized if a strong public and private partnership is forged between the government and the private sector.

CONCLUSIONS: Through the port of Gwadar, Pakistan will be able to offer Central Asian states their most efficient warm water access to both the west and the east, and the shortest route for Central Asian oil exports. Afghanistan and Central Asian states will therefore play a crucial role for the success of the Gwadar port. Islamabad has to work hard to establish trust and cooperation with Kabul. Indo-Pakistani rivalry in Afghanistan and the influence New Delhi enjoys with the Northern Alliance-dominated regime in Kabul should also be taken into account. In fact, in keeping with recent developments in the South Asian peace process, India can be approached to support the idea, from which it can potentially benefit. In light of all this, the decision made by the Pakistani government to develop a regional dimension to the project and initiate consultations with Afghanistan and Central Asian States to be followed up with regular intervals is very timely and appropriate. Gwadar will in all likelihood emerge as the true gateway to the Central Asia.

AUTHOR’S BIO: Rizwan Zeb is an Islamabad-based security Analyst and RCSS Mahbubul Haq Fellow. Currently he is working on book about Pakistan- Central Asia Relations.