Two days after Pakistan’s Supreme Court sacked Prime Minister Nawaz Sharif in what was no more than a judicial coup (July 28), question marks have begun to appear on CPEC, the multi-billion dollar Chinese showpiece to the world in the quest for more markets for its One Belt-One Road (OBOR) venture.

CPEC is a $62 billion venture to connect Kashgar in Xinjiang with Gwadar on Pakistan’s Arabian coast. Along the road, China has plans to set up a slew of coal based power plants and special economic zones, some of them specially designed to meet China’s hunger for farm products.
Going by media reports, China has been assured by Pakistan’s powerful military and politicians that its CPEC investments would not be disrupted by the verdict against Prime Minister Nawaz Sharif in a corruption case, known as Panama Papers case. The same media reports also say that some of China’s investments could come under the widening corruption probe currently playing havoc with Pakistani politics, says Tom Hussain in South China Morning Post (July 29, 2017).
Put simply, China has much at stake on CPEC. And therefore it has strong incentive to hope for a smooth transfer of power in Pakistan.
“China would likely urge the government, and the military for that matter, to move as quickly as possible to effect a peaceful transfer of power. China has a strong incentive to see through a smooth transition, and Pakistan, because of the deep significance it ascribes to CPEC, does as well,” said Michael Kugelman, deputy director of the Asian programme at The Woodrow Wilson Centre.
While unseating Sharif, Pakistan’s apex court did not hold him guilty of corrupt practices per se. It has left that task to the National Accountability Bureau (NAB), which will now pour over the Panama Papers that have brought to light Sharif family’s offshore companies and their properties in London. NAB will prepare charges of corruption, money laundering and fraud against Sharif and his three adult children. An accountability court will deliver its verdict on the charges by mid-October.
Well, this is a judiciary driven accountability process. In the eye of emerging storm are Nawaz’s younger brother, Shahbaz Sharif, and Opposition PTI supremo, Imran Khan. Shahbaz is the chief minister of key province of Punjab and he has played a leading role in CPEC negotiations. All this is a cause for Chinese worry.
“Although Beijing has a good working relationship with all the major political parties in Pakistan, they would prefer a degree of stability and continuity in order to make the execution of the CPEC projects as smooth a process as possible,” according to Andrew Small, a fellow at the German Marshall Fund and author of the China-Pakistan Axis, a report in South China Morning Post said.
The report also quoted Arif Rafiq, non-resident fellow at the Middle East Institute, a US think tank, as saying that the court’s ruling has put China in a peculiar position.
“The Chinese are treading into new waters: this is the first civilian government in Islamabad Beijing has fully invested in. [But] while the Communist Party of China is deeply leveraged in the civilian government, military-to-military ties also continue to strengthen,” he said.
It is possible that some CPEC projects will come under the lens and investigated because of existing allegations of corruption linked to the Sharifs.
“Some projects, such as the Port Qasim Coal Power Project, could come under greater scrutiny given the involvement of power brokers allegedly connected to Sharif family’s financial improprieties,” Rafiq said.
Well, there is no gain saying that there is a mutuality of interest between China and Pakistan in upholding the CPEC venture
Pakistan’s dependence on China for much of its defence needs against common rival India would reinforce its commitment to CPEC, opines Small.
“With the US-Pakistan relationship in decline, and with the PLA’s technological capabilities having improved so much, this now matters even more to Pakistan than it did when the US was seen as the critical supplier of high-end conventional equipment,” he said.
But the question is how they – China and Pakistan – will push ahead with the CPEC project in the face of political instability, terrorist menace, and economic distress that have become pronounced over the past few weeks.
Nawaz Sharif has already hit the road in a show of his muscle power deepening the fault lines in the country. His strident attacks on judiciary, and his not so veiled digs at the all-powerful permanent establishment of the country, namely the Army, are plunging Pakistan into a crisis that is unlikely to give any priority to Chinese worries. This is bad news to Beijing more so since Gwadar and adjoining areas of Balochistan appear to have become the playfields of the Baloch insurgents

-by m rama rao