Gwadar

Capital suggestion

Gwadar to Kashgar: One: up-grading of the 887km National Highway-35 which is the Pakistani portion of the Karakoram Highway (KKH). Two: the Eastern Route. Three: the Western Route. For the record, whichever route the future traffic takes the distance is going to be more or less 3,000 km.

CPEC: the China-Pakistan Economic Corridor has two main components: the corridor and the projects. The corridor component is roughly $11 billion, or 25 percent of the total, and the projects $34 billion, or 75 percent of the total.

Population centres in China: the largest metropolitan area in China is Guangzhou with a population of nearly 45 million. Guangzhouis 5,554 km from Kashgar. In terms of population, Guangzhou is followed by Shanghai, Chongqing, Beijing and Hangzhou. All of China’s population centres are more than 4,000 km from Kashgar.

Industrial centres in China: The largest mainland industrial centre in China is Beijing and Beijing is 4,357 km from Kashgar. In terms of industrial capacity, Beijing is followed by Shanghai, Shenzhen and Guangzhou. Shenzhen is home to Huawei, ZTE, BYD Automobile (among others). Guangzhou is home to the Guangzhou Economic and Technological Development Zone, Guangzhou Nansha Export Processing Zone and the Guangzhou Free Trade Zone. To be sure, all of China’s industrial cities are more than 5,000 km from Kashgar.

Ports in China: There are more than 2,000 ports in China of which 130 are open to foreign ships. The ports of Shanghai, Shenzhen, Ningbo-Zhoushan, Qingdao and Guangzhou are among the world’s busiest container ports. To be certain, China’s largest metropolitan areas and its industrial hubs are all only a few hundred kilometres from China’s ports.

Oil to China through Gwadar. Consider this: Edmonton (Canada) is 3,500 km from Montreal (Canada). The published uncommitted joint transportation rate for light crude petroleum from Edmonton to Montreal is $45.58 per cubic meter. If oil is transported from Gwadar to China’s population and industrial hubs the cost would come out to be around $70 per cubic meter.

Oil to China from Saudi Arabia: For the record, Saudi Arabia is the top crude supplier to China. Last month, China imported 4.5 million tonnes of crude from Saudi Arabia (that is the equivalent of 1.112 million barrels per day). For the record, the cost of ships carrying two million barrel cargoes from Saudi Arabia to China has gone up from $40,000 per day to a seasonal high of $80,000 per day. What that means is that the cost of transporting sea-borne oil, on average, will come out to be under $10 per cubic meter (as opposed to $70 per cubic meter through Gwadar).

South China Sea: According to the Council on Foreign Relations, “The risk of the [US-China] conflict in the South China Sea is significant.” The US recently sent in the carrier John C Stennis, two destroyers, two cruisers and the 7th Fleet flagship plus the destroyers Chung-Hoon and Stockdale. The People’s Liberation Army Navy now has 70 submarines – including 094A Jin-class – with 16 of them nuclear-powered. Russian and Chinese naval forces are planning to conduct joint exercises. The South China Sea conflict is all about ‘Anti-Access; Area Denial’ or A2/AD.

Gwadar as a trans-shipment port to China makes no economic sense. Truck cargoes from Gwadar to China travelling for 7,000 km to 8,000 km make no economic sense. Oil to China through Gwadar makes no economic sense. Similarly, Chinese products traveling for 7,000 km to 8,000 km all the way to Gwadar make no economic sense. Perhaps, it is all strategic – and our future depends on the strategic choice we make today.

The writer is a columnist based in Islamabad.

Email: farrukh15@hotmail.com. Twitter: @saleemfarrukh