Urumuqi-Gwadar Road & Rail Corridor

Transit & Transport Corridor

Pakistan-China Strategic Trade Partnership

Bilateral

The Urumuqi-Gwadar road and rail initiative is reflective of Pakistan-China strategic trade partnership. The initiation of this mega project in itself constitutes a landmark in the trade and transit infrastructure expansion in Pakistan. Once completed, goods can flow from Xingiang in China by rail, and the existing road mechanism, to Gwadar, and then to the Middle east. The Gwadar Port is already being operated by China.

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Pakistan envisages developing a road and railway corridor between Gwadar Port and China's Xinjiang province, bordering Northern Pakistan’s Gilgit–Baltistan regions. This project is has the potential to transform Pakistan into a vibrant trade hub connecting South East Asia, Central Asia and the Middle East. The corridor involves investment of $12 billion.

Gwadar Port will be connected through road, rail and fibre links to China to help enhance trade between the two countries. Oil and gas pipelines are also part of the economic corridor over the long run, which is expected to provide a much-needed boost to economic activities in insurgency-hit Balochistan, according to the officials.

Under the short-term plan, Islamabad and Beijing will develop Gwadar Port, whose control had already been given to China, in a bid to attract investment in different sectors to make it a hub of economic activities. Under this plan, an oil city will be set up at the port to meet fuel needs.Officials believe that 50% of total oil demand of China is met from imports that come from Middle East. At present supply line to China runs over 10,000km Dubai-Shanghai-Urumqi ocean route.

“The crude oil processed and refined at Gwadar Oil Refinery can be exported and transported to Urumqi through the shortest possible route to China via Dubai-Gwadar-Urumqi which is about 3,600km. For this an oil pipeline will be laid through the envisaged Energy Corridor up to Western China via KKH/Khunjrab bypass,” officials said.

They said that impediments like high altitude, freezing temperature and difficult terrain could be overcome through certain technological advancements since many countries had successfully completed such pipeline projects under extreme conditions and high altitude such as ATACAMA gas pipeline, Trans-Alkaska Pipeline, Trans-Asia Gas pipeline etc.

Gwadar and Chahbahar though adjacent, point in different directions — one is oriented northeastwards towards China and eastern Afghanistan while the other is oriented towards western Afghanistan and the Caspian region.

The proposed interlinking would allow each country to access the other. In addition, there are economies of scale and complementarities from which both benefit. One of these could be Iran locating petrochemical facilities between the two ports. One has to look no further than the United Arab Emirates and find a number of seaports (and airports) close to each other and the entire region prospering as a highly efficient logistics and transport hub.

 

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