CPEC is connecting China’s Xinjiang with Pakistan’s Gwadar port is regarded as the flagship project of the multi-billion dollar Belt and Road Initiative (BRI) which is aimed at furthering China’s global influence with infrastructure projects funded by Chinese investments all over the world.
The CPEC is bilateral project between Pakistan and China, intended to promote connectivity across Pakistan with a network of highways, railways, and pipelines accompanied by energy, industrial, and other infrastructure development projects linking the Western part of China to the Gwadar Port in Balochistan, Pakistan running some 3000 km from Xinjiang to Balochistan via Khunjerab Pass in the Northern Parts of Pakistan. CPEC is a part of OBOR.
It will pave the way for China to access the Middle East and Africa from Gwadar Port, enabling China to access the Indian Ocean and in return China will support development projects in Pakistan to overcome the latter’s energy crises and stabilizing its faltering economy.
China has committed to invest over USD 60 billion in Pakistan as part of the CPEC under which it planned to build a number of special economic zones.
CPEC's potential impact on Pakistan has been compared to that of the Marshall Plan undertaken by the United States in post-war Europe. Pakistani officials predict that CPEC will result in the creation of upwards of 2.3 million jobs between 2015–2030, and add 2 to 2.5 percentage points to the country's annual economic growth.
India’s objections to CPEC
Sovereignty claims: India objects to the CPEC project as upgrade works to the Karakoram Highway are taking place in Gilgit Baltistan in Pakistan-occupied Kashmir; territory that India claims as its own.
Encirclement fears: India has alleged that China and Pakistan intended to develop the corridor not just for its economic benefits, but also is motivated by the "strategic intent of besieging India.”
India has not supported OBOR. China’s insistence on establishing the CPEC project through PoK is seen by India as infringing its sovereignty.
China is building roads and infrastructure in the disputed territory of Gilgit-Balistan, which is under Pakistan’s control but which India claims as a part of Jammu and Kashmir.
If CPEC project gets implemented successfully, this would hamper India’s strategic interests in the South Asian region. It will serve Beijing's strategic ambition to encircle India.
CPEC can aid Pakistan’s legitimacy in the Kashmir dispute.
China’s increasing footprints in the South Asian region is detrimental to India’s strategic hold e.g. construction of the Hambantota Port in Sri Lanka provided China critical strategic location in Indian Ocean.