Before the CPEC

Part - I

“Cheen apna yar hai,/Is pe jaan nisar hay,/Per wahan hay jo nizam,/Us taraf na jayeo, Us ko dur se salam”

(China is our friend/we would give our lives for it/But the system in place there/don’t follow it, salute it from afar).

Revolutionary poet Habib Jalib – best known for his struggle against exploitation, oppression and military regimes – through this verse aptly explained the paradoxical nature of Pak-China relations.

Like most Pakistanis, Jalib also considered China a communist country. However, despite its claims China was neither a ‘people’s republic’ nor was the revolution there, unlike Russia, a workers’ revolution. English and Urdu translations of China’s communism were freely (and at no cost) available in Pakistan. Nonetheless, it was a dilemma for the Maoist movement in Pakistan that the state, which had waged a war against peasants from 1967 to 1977, became a close ally of China.

As Pakistan extended relations with Peking (Beijing), Maoist groups here had relative relatively easy time at the hands of the Pakistani state compared to pro-Moscow communist groups. Despite this policy, the Pakistani state did not tolerate the peasant uprising under militant Maoist groups. Nor did China extend any support to pro-Maoist militant peasant groups against the Pakistani state.

M Abul Fazl, a former diplomat, writes that – contrary to what has been propagated in textbooks and through the media – both Pakistan and India had recognised communist China in January 1951 via British encouragement. Though the Pakistani leadership had a contemptuous attitude towards communism, it had no particular feelings against the new China. Pakistan was opposed to the admission of China in the UN; and China was neutral on Pakistan’s stance on Kashmir: “For example even when we were opposing China’s admission to the United Nations year after year, China maintained neutrality over Kashmir, instead of following the Soviets into declaring it a part of India.” Following almost a decade of rather cool relations between the two neighbouring countries, bilateral relations normalised in the next decades.

The Sino-India conflict in 1962 paved the way for better relations between China and Pakistan and both signed a boundary agreement in 1963, following by military and strategic alliances in 1966 and 1972 respectively. However, on the eve of Pakistan’s war with India in 1971, China kept away because of the Russian threat.

It seems that the Sino-Indian conflict was a turning point in bilateral relations between the two countries as India was involved in border conflicts with both countries. This resulted in war with China in 1962 and with Pakistan in 1965. American foreign policy expert Jonah Blank writes that, apart from the rhetoric of China and Pakistan, the “two nations have virtually no shared culture, history, or economic ties. The glue sticking them together would appear to be military ties and an interest in keeping their common rival, India, off balance.”

This means that the main reason behind Pak-China relations was strategic: China helped develop Pakistan’s nuclear and missile programmes, providing conventional arms and diplomatic support. In return, the Chinese were allegedly provided access to American security equipment and technology – which benefited both countries.

Pakistan had played the key role of an intermediary between China and the US, as China was inclined to join mainstream capitalism by distancing itself from Russia and its alliances. The return of Deng Xiaoping to power in 1977 was pivotal as far as following neo-liberalism was concerned. It was only then that economic cooperation between China and Pakistan began (in 1979).

Pakistan gains militarily and strategically from its cooperation with China. However, in terms of bilateral trade Pakistan has comprehensively lost to China. Having China in the world market, Pakistan is losing its share in textile, garments and apparels. Pakistan has already lost its domestic market to Chinese goods after bilateral trade agreements.

There are many reasons for losing the national and international market to China. China has a competitive advantage over its competitors in the world economy. The most important is human capital: Chinese labour is cheap and of great quality. The second factor is the supply of energy and material. For instance in textile, China is still labour intensive, low tech and low value added.

Commercial links between Pakistan and China were mostly established in the 21st century. Chinese goods flooded Pakistan after the Free Trade Agreement in July 2007. At the time, Pakistani manufacturing sectors had been facing an energy crisis and high production cost due to a number of reasons. Chinese products were available in the market at even below production cost. Therefore, it became easy for manufacturers to import parts and assemble them in their industrial complexes – or simply import finished goods from China. This results in little resistance from the local capitalist class.

A simple calculation of Pak-China relations can be: Pakistan gains militarily and strategically, and loses economically to China.

To be continued

The writer is an independent researcher. Email: sartaj2000@yahoo.com