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China–Pakistan Economic Corridor
Mission statement	Securing Energy Import and Trade Boost for China,[1] Infrastructure Development for Pakistan[1]
Type of project	Economic corridor
Location	Pakistan: Khyber Pakhtunkhwa, Gilgit-Baltistan, Punjab, Balochistan, Sindh & Azad Kashmir China: Xinjiang
Country	China Pakistan
Established	20 April 2015 (9 years ago) (2015-04-20)[2]
Budget	$62 billion [3]
Status	A few projects operational Special Economic Zones Under construction (2020).[5][6] Many projects running behind the schedule (2022)[7] Few projects cancelled.[8]
Website	cpec.gov.pk

China–Pakistan Economic Corridor (CPEC) (Chinese: 中巴经济走廊; pinyin: Zhōng bā jīngjì zǒuláng; Urdu: چین پاکستان اقتصادی راہداری) is a 3,000 km Chinese infrastructure network project in construction in Pakistan.^[9] This sea-and-land-based corridor is aimed to secure and reduce the passage for China's energy imports^[9] from the Middle East, by avoiding the existing route from the Straits of Malacca between Malaysia and Indonesia, which, in case of war could be blockaded, and thus hamper the Chinese energy-dependent economic avenues.^[1][10][11] Developing a deep water port at Gwadar in the Arabian Sea and a well built road and rail line from this port to Xinjiang region in western China would be a shortcut for boosting the trade between Europe and China.^[1][10] In Pakistan, it aims to overcome an electricity shortfall, infrastructural development and modernize transportation networks. Along with shifting it from an agricultural based economic structure to industrial based.^[12]

CPEC is seen as the main plank of China's Belt and Road Initiative,^[13] and as of at least early 2024, is the BRI's most developed land corridor. CPEC's potential impact on Pakistan has been compared to that of the Marshall Plan, undertaken by the United States in post-war Europe.^[14][15][16] Pakistani officials predict that CPEC will result in the creation of upwards of 2.3 million jobs between 2015 and 2030, and add 2 to 2.5 percentage points to the country's annual economic growth.^[17] As of 2022, it has enhanced Pakistan's exports and development capacity and has provided 1/4th of its total electricity.^[18]

It is also seen as addressing a national security issue for China by economic development of the Xinjiang region, thus reducing militant influence on Muslim separatists of native Uyghurs.^{[1][10][11][19]} After the proposal from Chinese President Li Keqiang in 2013,^[9] the preliminary study on this project was done in 2014, which acknowledged the hostile environment and complicated geographic conditions but prioritized the importance of having a China-run port near the Gulf of Oman which serves as an important route for oil tankers.^[20] Once this corridor is functional, the existing 12,000 km journey of oil transportation to China will be reduced to just 2,395 km.^[21] This is estimated to save China $2 billion per year.^[22] China had already acquired control of Gwadar Port on 16 May 2013.^[20] Originally valued at $46 billion, the value of CPEC projects was worth $62 billion as of 2020.^[23] In 2022, the Chinese investment in Pakistan rose to $65 billion.^[24] China refers to this project as the revival of the Silk Road.^[25] CPEC envisages rapidly upgrading Pakistan's required infrastructure and thereby strengthening its economy to an extent by constructing modern transportation networks, numerous energy projects, and special economic zones.^{[26][27][28][29]}

The potential industries being set up in the CPEC special economic zones include food processing, cooking oil, ceramics, gems and jewelry, marble, minerals, agriculture machinery, iron and steel, motorbike assembling, electrical appliances, and automobiles.^[30]

Since 2021, due to the growing pressure on China for being the world's biggest polluter, it has shifted its focus from coal-based energy investments in Pakistan to renewables. This is done to promote a more "greener" image of CPEC.^[31] In June 2022, the Karot Hydropower started commercial operations to provide cheap and clean electricity and aims to reduce 3.5 million metric tons of carbon emissions annually.^[32]

History

Background

Plans for a corridor stretching from the Chinese border to Pakistan's deepwater ports on the Arabian Sea date back to the 1950s, and motivated construction of the Karakoram Highway beginning in 1959.^[33] Chinese interest in Pakistan's deep-water harbor at Gwadar had been rekindled by in 2002 China began construction at Gwadar port which was completed in 2006. Expansion of Gwadar Port then ceased thereafter owing to political instability in Pakistan following the fall of General Pervez Musharraf and subsequent conflict between the Pakistani state and Taliban militants.^[34]

Since the early 1990s, the IMF has provided more than a dozen bailouts on requests by Pakistan to save its dwindling economy, which has struggled for 22 of the 30 years to meet the austerity measures demanded by IMF. Nadeem-ul-Haque, a former IMF official and former deputy chairman of the Pakistani government's Planning Commission wrote, "The pattern is always the same, with the Fund's blessing, the government goes on a shopping spree, taking out costly loans for expensive projects, thus building up even more debt and adding new inefficiencies. After a few years, another crisis ensues, and it is met by another IMF program."^[35] The Pakistani establishment sees Chinese loans as an alternative to IMF loans.^[36] Should the initial $46 billion worth of projects be implemented, the value of those projects would be roughly equivalent to all foreign direct investment in Pakistan since 1970,^[37] and would be equal to 17% of Pakistan's 2015 gross domestic product.^[38]

In 2013, the then Pakistani President Asif Ali Zardari and Chinese Premier Li Keqiang decided to further enhance mutual connectivity.^[39] A memorandum of understanding on cooperation for long-term plan on China–Pakistan Economic Corridor between the two governments was inked by Xu Shao Shi and Shahid Amjad Chaudhry.^[40]

In February 2014, Pakistani President Mamnoon Hussain visited China to discuss the plans for an economic corridor in Pakistan.^[41] Two months later, Pakistan Prime Minister Nawaz Sharif met with Premier Li Kequiang in China to discuss further plans,^[42] resulting in the full scope of the project to be devised under Sharif's tenure.^[43] In November 2014, the Chinese government announced its intention to finance Chinese companies as part of its $45.6 billion energy and infrastructure projects in Pakistan as part of CPEC.

Even though China and Pakistan signed the official MoUs in 2015, the first details of the long-term plan under CPEC were publicly disclosed in 2017 when a Pakistani media outlet revealed its access to the Original Documents.^[44]

Announcement of CPEC

Chinese President Xi Jinping on his “fate-changing visit” to Pakistan for signing the CPEC agreement stated “I feel as if I am going to visit the home of my brother,”^[45] and claimed that friendship between the two nations was “higher than mountains, deeper than oceans and sweeter than honey”.^[1] China repeatedly uses terms like "iron brothers" and "all weather friends" while describing its relation with Pakistan.^[46] On 20 April 2015, Pakistan and China signed an agreement to commence work on the $46 billion agreement, which is roughly 20% of Pakistan's annual GDP,^[47] with approximately $28 billion worth of fast-tracked "Early Harvest" projects to be developed by the end of 2018.^[48][49]

A vast network of highways and railways are to be built under the aegis of CPEC that will span the length and breadth of Pakistan. Inefficiencies stemming from Pakistan's mostly dilapidated transportation network are estimated by the government to cause a loss of 3.55% of the country's annual GDP.^[50] Modern transportation networks built under CPEC will link seaports in Gwadar and Karachi with northern Pakistan, as well as points further north in western China and Central Asia.^[51] A 1,100-kilometre-long motorway will be built between the cities of Karachi and Lahore as part of CPEC,^[52] while the Karakoram Highway from Hasan Abdal to the Chinese border will be completely reconstructed and overhauled.^[37] The currently stalled Karachi–Peshawar main railway line will also be upgraded to allow for train travel at up to 160 km per hour by December 2019.^[53][54] Pakistan's railway network will also be extended to eventually connect to China's Southern Xinjiang Railway in Kashgar.^[55] The estimated $11 billion required to modernise transportation networks will be financed by subsidized concessionary loans.^[56]

Over $33 billion worth of energy infrastructure are to be constructed by private consortia to help alleviate Pakistan's chronic energy shortages,^[57] which regularly amount to over 4,500MW,^[58] and have shed an estimated 2–2.5% off Pakistan's annual gross domestic product.^[59] Over 10,400 MW of generating capacity is to be brought online by the end of 2018, with the majority developed as part of CPEC's fast-tracked "Early Harvest" projects.^[60] A network of pipelines to transport liquefied natural gas and oil will also be laid as part of the project, including a $2.5 billion pipeline between Gwadar and Nawabshah to eventually transport gas from Iran.^[61] Electricity from these projects will primarily be generated from fossil fuels, though hydroelectric and wind-power projects are also included, as is the construction of one of the world's largest solar farms.^[62]

Should the initial $46 billion worth of projects be implemented, the value of those projects would be roughly equivalent to all foreign direct investment in Pakistan since 1970,^[37] and would be equal to 17% of Pakistan's 2015 gross domestic product.^[38] CPEC is seen as the main plank of China's Belt and Road Initiative.^[13] At the beginning of this project, Pakistan has assigned about 10,000 troops to protect the Chinese investments.^[11] However, this number increased to 15,000 actively deployed troops by 2016.

Subsequent developments

On 12 August 2015 in the city of Karamay, China and Pakistan signed 20 more agreements worth $1.6 billion to further augment the scale and scope of CPEC.^[63] Details of the plan are opaque,^[64] but are said to mainly focus on increasing energy generation capacity.^{[65][better source needed]} As part of the agreement, Pakistan and China have agreed to co-operate in the field of space research.^[66]

In September and October 2015, the government of the United Kingdom announced two separate grants to the Government of Pakistan for construction of roadways that are complementary to CPEC.^[67][68] In November 2015, China included the CPEC into its 13th five-year development plan,^[69] while in December 2015, China and Pakistan agreed on a further $1.5 billion investment to set up an information and technology park as part of the CPEC project.^[70] On 8 April 2016, during the visit of Xinjiang's Communist Party chief Zhang Chunxian companies from Xinjiang with their Pakistan counterparts signed $2 billion of additional agreements covering infrastructure, solar power and logistics.^[71]

The first convoy from China arrived in Gwadar on 13 November 2016, thereby formalizing operation of CPEC.^[72] On 2 December 2016, the first cargo train, launching the direct rail route and sea freight service between China and Pakistan, departed from Yunnan. A cargo train loaded with 500 tonnes of commodities left Kunming for the port city of Guangzhou from where the cargo will be loaded on ships and transported to Karachi, marking the opening of the new route.^[73] The new rail, sea freight will cut logistics cost, including that of transport, by 50 per cent.^[74]

In November 2016, China announced an additional $8.5 billion investment in Pakistan with $4.5 billion allocated to upgrade Pakistan's main railway line from Karachi to Peshawar including tracks, speed, and signaling, and $4 billion toward an LNG terminal and transmission lines to help alleviate energy shortages.^[75] In February 2017, the Egyptian Ambassador to Pakistan expressed interest in CPEC cooperation.^[76] In January 2017, Chief Minister Pervez Khattak of Khyber Pakhtunkhwa stated that he had received assurances from Chinese investment companies that they would invest up to $20 billion for projects.^[77] In March 2017, an agreement was signed for the projects, which include: a $1.5 billion oil refinery, irrigation projects worth $2 billion, a $2 billion motorway between Chitral and DI Khan, and $7 billion worth of hydro-electric projects.^[78]

As of September 2017, more than $14 billion worth of projects were under construction.^[13] In March 2018, Pakistan announced that following the completion of under-construction energy projects, future CPEC energy projects would be geared towards hydropower projects.^[79]

In 2022, Federal Minister for Planning, Development and Special Initiatives Prof. Ahsan Iqbal criticized CPEC authority for its inability to attract investments and called for its dissolution.^[80] On 17 August 2022, Prime Minister Shehbaz Sharif approved, in principle, to abolish the China–Pakistan Economic Corridor (CPEC) Authority subject to consent by China.^[81]

Projects in Gwadar Port and City

Gwadar came in the focus of attention post the Kargil War when Pakistan felt the need of having a military naval port and the Karachi-Gwadar Road (Coastal Highway) was built for defence purpose.^[82] Gwadar forms the crux of the CPEC project, as it is envisaged to be the link between China's ambitious One Belt, One Road project, and its 21st Century Maritime Silk Road project.^[83] In total, more than $1 billion worth of projects are to be developed around the port of Gwadar by December 2017.

As of 2022, only three China–Pakistan Economic Corridor projects – $4 million Gwadar Smart Port City Master Plan, $300 million Physical Infrastructure of Gwadar Port and the Free Zone Phase-1, and a $10 million Pak-China Technical and Vocational Institute – in Gwadar were declared completed whereas one-dozen projects worth nearly $2 billion remain undeveloped including water supply, electricity provision, expressway, international airport, fishing harbour and hospital among others.^[84]

China has provided a total of 7,000 sets of solar panels for households in Gwadar over the past two years. Another 10,000 sets of solar panels are under active preparation and will be allocated to poor people in Balochistan. The Chinese Embassy in Pakistan is also to donate household solar units and other assistance to the people of Balochistan.^[18]

Gwadar Port Complex

Initial infrastructure works at Gwadar Port commenced in 2002 and were completed in 2007,^[34] however plans to upgrade and expand Gwadar's port stalled. Under CPEC agreement, Gwadar Port will initially be expanded and upgraded to allow for docking of larger ships with deadweight tonnage of up to 70,000.^[85] Improvement plans also include construction of a $130 million breakwater around the port,^[86] as well as the construction of a floating liquefied natural gas facility that will have a capacity of 500 million cubic feet of liquefied natural gas per day and will be connected to the Gwadar-Nawabshah segment of the Iran–Pakistan gas pipeline.^[87]

The expanded port is located near a 2,282-acre free trade area in Gwadar which is being modeled on the lines of the Special Economic Zones of China.^[88] The swathe of land was handed to the China Overseas Port Holding Company in November 2015 as part of a 43-year lease.^[89] The site will include manufacturing zones, logistics hubs, warehouses, and display centres.^[90] Businesses located in the zone would be exempt from customs authorities as well as many provincial and federal taxes.^[85] Business established in the special economic zone will be exempt from Pakistani income, sales, and federal excise taxes for 23 years.^[91] Contractors and subcontractors associated with China Overseas Port Holding Company will be exempted from such taxes for 20 years,^[92] while a 40-year tax holiday will be granted for imports of equipment, materials, plant/machinery, appliances, and accessories that are to be for construction of Gwadar Port and special economic zone.^[93]

The special economic zone will be completed in three phases. By 2025, it is envisaged that manufacturing and processing industries will be developed, while further expansion of the zone is intended to be complete by 2030.^[34] On 10 April 2016, Zhang Baozhong, chairman of China Overseas Port Holding Company said in a conversation with The Washington Post that his company planned to spend $4.5  billion on roads, power, hotels and other infrastructure for the industrial zone as well as other projects in Gwadar city.^[17]

Projects in Gwadar city

China will grant Pakistan $230 million to construct a new international airport in Gwadar.^[94] The provincial government of Balochistan has set aside 4000 acres for the construction of the new $230 million Gwadar International Airport which will require an estimated 30 months for construction,^[95] the costs of which are to be fully funded by grants from the Chinese government which Pakistan will not be obliged to repay.^[96]

The city of Gwadar is further being developed by the construction of a 300 MW coal power plant, a desalinization plant, and a new 300-bed hospital to be completed in 2023.^[97] Plans for Gwadar city also include construction of the Gwadar East Bay Expressway – a 19 kilometre controlled-access road that will connect Gwadar Port to the Makran Coastal Highway.^[98] These additional projects are estimated to cost $800 million, and are to be financed by 0% interest loans extended by the Exim Bank of China to Pakistan.^[97]

In addition to the aforementioned infrastructure works, the Pakistani government announced in September 2015 its intention to establish a training institute named Pak-China Technical and Vocational Institute at Gwadar,^[34] which is to be developed by the Gwadar Port Authority at the cost of 943 million rupees,^[34] and is designed to impart to residents the skills required to operate and work at the expanded Gwadar Port.^[34]

As of 2017, in total there are 9 projects funded by China in and around Gwadar.^[99]

Development of Gwadar includes the building of a hospital under a Chinese government grant. Under the proposed project medical blocks, nursing and paramedical institutes, medical college, central laboratory, and other allied facilities are to be constructed with the supply of medical equipment and machinery.^[100]

In 2020, Government^[which?] released funds of Rs 320 million for a Gwadar Seawater Desalination Plant at Gwadar, with a capacity of five million gallons a day. The funds were also to be used in the expansion of the optical fiber network in Gwadar^[101] and construction of a fish landing jetty.^[102]

Roadway projects

The CPEC project envisages major upgrades and overhauls to Pakistan's transportation infrastructure. Under the CPEC project, China has announced financing for $10.63  billion worth of transportation infrastructure so far; $6.1  billion have been allocated for constructing "Early Harvest" roadway projects at an interest rate of 1.6 percent.^[103] The remainder of funds will be allocated when the Pakistani government awards contracts for the construction of road segments which are still in the planning phase.

Three corridors have been identified for cargo transport: the Eastern Alignment through the heavily populated provinces of Sindh and Punjab where most industries are located, the Western Alignment through the less developed and more sparsely populated provinces of Khyber Pakhtunkhwa and Balochistan, and the future Central Alignment which will pass through Khyber Pakhtunkhwa, Punjab, and Balochistan.^[104]

Karakoram Highway

The CPEC projects call for reconstruction and upgrade works on National Highway 35 (N-35), which forms the Pakistani portion of the Karakoram Highway (KKH). The KKH spans the 887-kilometer long distance between the China-Pakistan border and the town of Burhan, near Hasan Abdal. At Burhan, the existing M1 motorway will intersect the N-35 at the Shah Maqsood Interchange. From there, access onwards to Islamabad and Lahore continues as part of the existing M1 and M2 motorways. Burhan will also be at the intersection of the Eastern Alignment, and Western Alignment.

Upgrades to the 487-kilometer long section between Burhan and Raikot of the Karakoram Highway are officially referred to in Pakistan as the Karakoram Highway Phase 2 project. At the southern end of the N-35, works are already underway to construct a 59-kilometer-long, 4-lane controlled-access highway between Burhan and Havelian which upon completion will be officially referred to as the E-35 expressway.^[105] North of Havelian, the next 66 kilometres of road will be upgraded to a 4-lane dual carriageway between Havelian and Shinkiari.^[106] Groundbreaking on this portion commenced in April 2016.^[107]

The entire 354 kilometres of roadway north of Shinkiari and ending in Raikot, near Chilas will be constructed as a 2-lane highway.^[107] Construction on the first section between Shinkiari and Thakot commenced in April 2016 jointly with construction of the Havelian to Shinkiari 4-lane dual carriageway further south.^[108] Construction on both these sections is expected to be completed with 42 months at a cost of approximately $1.26 billion with 90% of funding to come from China's EXIM bank in the form of low interest rate concessional loans.^{[108][109][110]}

Between Thakot and Raikot spans an area in which the government of Pakistan is currently either planning or actively constructing several hydropower projects, most notably the Diamer-Bhasha Dam and Dasu Dam. Sections of the N-35 around these projects will be completely rebuilt in tandem with dam construction.^[111] In the interim, this section of the N-35 is currently being upgraded from its current state until dam construction commences in full force at a later date. Improvement projects on this section are expected to be completed by January 2017 at a cost of approximately $72 million.^[112][113] The next 335 kilometres of roadway connect Raikot to the China-Pakistan border. Reconstruction works on this section of roadway preceded the CPEC, and were initiated after severe damage to roadways in the area following the 2010 Pakistan floods. Most of this section of roadway was completed in September 2012 at a cost of $510 million.^[114]

A large earthquake rocked the region nearest to the China-Pakistan border in 2010, triggering massive landslides that dammed the Indus River, resulting in the formation of the Attabad Lake. Portions of the Karakoram Highway were submerged in the lake, forcing all vehicular traffic onto barges to traverse the new reservoir. Construction on a 24 kilometer series of bridges and tunnels to Attabad Lake began in 2012 and required 36 months for completion. The bypass consists of 2 large bridges and 5 kilometres worth of tunnels that were inaugurated for public use on 14 September 2015 at a cost of $275 million.^[115][116] The 175 kilometre road between Gilgit and Skardu will be upgraded to a 4-lane road at a cost of $475 million to provide direct access to Skardu from the N-35.^[117][118]

Eastern Alignment

The term Eastern Alignment of CPEC refers to roadway projects located in Sindh and Punjab provinces – some of which were first envisioned in 1991.^[119] As part of the Eastern Alignment, a 1,152 km long motorway will connect Pakistan's two largest cities, Karachi and Lahore with 6-lane controlled access highway designed for travel speeds up to 120 kilometres per hour.^[120] The entire project will cost approximately $6.6 billion, with the bulk of financing to be distributed by various Chinese state-owned banks.^[121]

The entire Eastern Alignment motorway project is divided into four sections: a 136-kilometer long section between Karachi and Hyderabad also known as the M9 motorway, a 345-kilometer long section between Hyderabad and Sukkur, a 392-kilometer long section between Sukkur, and Multan,^[122] and a 333-kilometer section between Multan and Lahore via the town of Abdul Hakeem.^[123]

The first section of the project is providing high-speed road access from the Port of Karachi to the city of Hyderabad and interior Sindh. Upgrade and construction works on this section currently known as Super Highway between Karachi and Hyderabad began in March 2015, and will convert the road into the 6-lane controlled access M9 Motorway which was completed in an estimated 30 months.^[124] In February 2017, a completed 75 kilometer stretch of the motorway was opened for public use by Prime Minister Nawaz Sharif.^[125]

At the terminus of the M9 motorway in Hyderabad, the Karachi-Lahore Motorway will continue onwards to Sukkur as a six-lane controlled-access motorway known also as M6 motorway that will be 345 kilometers long,^[122] The planned cost for this project is $1.7 billion,^[126] and will provide high-speed road access to interior Sindh – especially near the towns of Matiari, Nawabshah, and Khairpur. The project will require the construction of seven interchanges, and 25 bridges on the Indus river and irrigation canals.^[127] The planned route of the motorway runs roughly parallel to the existing National Highway and Indus Highway at various portions. In July 2016, the Pakistani government announced that the project would be open to international bidders on a build-operate-transfer basis, with Chinese and South Korean companies expressing interest in the project.^[126]

The 392 kilometers Sukkur to Multan section of the motorway is estimated to cost $2.89  billion,^[120] with construction works inaugurated on this section of roadway on 6 May 2016 and completed in September 2019.^[128] The road will be a six lane wide controlled access highway,^[129] with 11 planned interchanges, 10 rest facilities, 492 underpasses, and 54 bridges along its route.^[128] The Pakistani government in January 2016 awarded the contract to build this section to China State Construction Engineering,^[120] but final approvals required for disbursement of funds were not granted by the Government of the People's Republic of China until May 2016.^[110][120] 90% of the project's cost is to be financed by concessionary loans from China, with the remaining 10% to be financed by the government of Pakistan.^[130] Construction on this segment is expected to last 36 months.^[120]

Construction of the portion between Multan and Lahore costing approximately $1.5 billion^[131] was launched in November 2015^[132] as a joint venture between the China Railway Construction Corporation Limited and Pakistan's Zahir Khan and Brothers Engineers.^[133] The total length of this motorway section is 333 kilometres; however, the first 102 kilometres of the road between Khanewal and Abdul Hakeem is designed as part of the M4 Motorway, and is being funded by the Asian Development Bank.^[134][135] The portion of motorway between Abdul Hakeem and Lahore that is under construction as part of CPEC will consist of the remaining 231 kilometers.^[136]

Western Alignment

The CPEC project envisages an expanded and upgraded road network in the Pakistani provinces of Balochistan, Khyber Pakhtunkhwa, and western Punjab Province as part of the Western Alignment. The Western Alignment project will result in the upgrading of several hundred kilometers worth of road into 2 and 4-lane divided highways by mid-2018, with land acquisition sufficient for upgrading parts of the road to a 6-lane motorway in the future.^[137] In total, the CPEC project envisages reconstruction of 870 kilometers of road in Balochistan province alone as part of the Western Alignment. Of those 870 kilometers of road, 620 kilometers have already been rebuilt as of January 2016.^[138]

The Western Alignment roadway network will begin at the Barahma Bahtar Interchange on the M1 Motorway near the towns of Burhan and Hasan Abdal in northern Punjab province.^[139] The newly reconstructed Karakoram Highway will connect to the Western Alignment at Burhan, near where the new 285-kilometre-long controlled-access Brahma Bahtar-Yarik Motorway will commence.^[140] The motorway will terminate near the town of Yarik, just north of Dera Ismail Khan.^[141] Groundbreaking for the project took place on 17 May 2016 and was inaugurated on 5 January 2022.^[142] The motorway traverses the Sindh Sagar Doab region, and cross the Indus River at Mianwali before entering into Khyber Pakhtunkhwa province. It consists of 11 interchanges, 74 culverts, and 3 major bridges spanning the Indus, Soan, and Kurram Rivers.^[143] Total costs for the project were approx. $1.05 billion.^[144]

At the southern terminus of the new Brahma Bahtar-Yarik motorway, the N50 National Highway will also be upgraded between Dera Ismail Khan in Khyber Pakhtunkhwa and Zhob in neighbouring Balochistan province, with eventual reconstruction between Zhob and Quetta.^[145] The upgraded roadway will consist of a 4 lane dual-carriageway spanning the 205 kilometre distance between the two cities.^[146] The first portion of the N50 to be upgraded will be the 81 kilometre portion of the N50 between Zhob and Mughal Kot, with construction works having begun in January 2016.^[147] Construction on this portion is expected to be completed by 2018 at a cost of $86 million.^[145] While the project is considered a vital link in the CPEC's Western Alignment,^[147] the project's cost will not be financed by Chinese state-owned banks, but instead by Asian Development Bank under a 2014 agreement which preceded CPEC,^[148][149] as well as by a grant provided by the United Kingdom's Department for International Development.^[150]

Heading south from Quetta, the Western Alignment of the CPEC will continue to the town of Surab in central Balochistan as the N25 National Highway. From Surab, a 470 kilometre long route known as the N85 National Highway will connect central Balochistan with the town of Hoshab in southwestern Balochistan province near the city of Turbat. The stretch of road between these cities was completed in December 2016,^[151] as per schedule.^[152]

Along the Western Alignment route, the towns of Hoshab and Gwadar are connected by a newly built 193-kilometer-long portion of the M8 Motorway – the Hoshab to Gwadar portion of the motorway was completed and inaugurated in February 2016 by Prime Minister Nawaz Sharif.^[153] The Western Alignment will be flanked by special economic zones along its route,^[154] with at least seven special economic zones planned to be established in Khyber Pakhtunkhwa.^[137]

Central Alignment

Long-term plans for a "Central Alignment" of the CPEC consist of a network of roads which is shortest route of CPEC and will commence in Gwadar and travel upcountry via the cities of Basima, Khuzdar, Sukkur, Rajanpur, Layyah, Muzaffargarh, Talagang with onward connections to Karakoram Highway via the Brahma Bahtar–Yarik Motorway.^[155]

Associated roadway projects

ADB funded projects

The 184 kilometers long M-4 Motorway between Faisalabad and Multan does not fall under the scope of CPEC projects but is nevertheless considered vital to the CPEC transportation project. It will instead be financed by the Asian Development Bank and the Asian Infrastructure Investment Bank,^[134] and will be the first project jointly financed by those banks.^[156] Further funding comes from an additional $90.7  million grant announced in October 2015 by the government of the United Kingdom towards the construction of a portion of the M4 Motorway project.^[157]

The Karakoram Highway south of the city of Mansehra will also be upgraded into a controlled-access highway to officially be known as the E-35 expressway. While it is considered to be a crucial part of the route between Gwadar and China, the E35 will not be financed by CPEC funds. The project will instead be financed by the Asian Development Bank^[158] with a $121.6 million grant from the United Kingdom towards the project.^[159] Once completed, the E35 Expressway, the M4 Motorway, and Karachi-Lahore Motorway will provide continuous high-speed road travel on controlled-access motorways from Mansehra to Karachi – 1,550 kilometers away.

Approximately halfway between Zhob and Quetta, the town of Qilla Saifullah in Balochistan lies at the intersection of the N50 National Highway and the N70 National Highway. The two roads form the 447-kilometer route between Quetta and Multan in southern Punjab. While the N70 project is not officially a part of CPEC, it will connect the CPEC's Western Alignment to the Karachi-Lahore Motorway at Multan. Reconstruction works on the 126 kilometre portion of the N70 between Qilla Saifullah and Wagum are slated for completion by 2018,^[160] and are financed as part of a $195 million package by the Asian Development Bank,^[149] and by a $72.4 million grant from the United Kingdom's Department for International Development.^[150]

Railway projects

The CPEC project emphasises major upgrades to Pakistan's aging railway system, including rebuilding of the entire Main Line 1 railway between Karachi and Peshawar by 2020;^[161] this single railway currently handles 70% of Pakistan Railways traffic.^[162] As of 25.05.2022 this project is in doldrums due to reluctance of China to provide funds.^[163] In addition to the stalled Main Line 1 railway, upgrades and expansions are slated for the Main Line 2 railway, Main Line 3 railway. The CPEC plan also calls for completion of a rail link over the 4,693-meter high Khunjerab Pass. The railway will provide direct access for Chinese and East Asian goods to Pakistani seaports at Karachi and Gwadar by 2030.^[162]

Procurement of an initial 250 new passenger coaches, and reconstruction of 21 train stations are also planned as part of the first phase of the project – bringing the total investment in Pakistan's railway system to approximately $5  billion by the end of 2019.^[164] 180 of the coaches are to be built at the Pakistan Railways Carriage Factory near Islamabad,^[165] while the Government of Pakistan intends to procure an additional 800 coaches at a later date, with the intention of building 595 of those coaches in Pakistan.^[165]

In September 2018, the new government led by Prime Minister Imran Khan reduced the Chinese investment in railways by $2 billion to $6.2 billion because of financing burdens.^[166]

Main Line 1

The CPEC "Early Harvest" plan includes ^{[citation needed]} a complete overhaul of the 1,687 kilometre long Main Line 1 railway (ML-1) between Karachi and Peshawar. The plan was initial floated in 2015,^[167] however as of January 2023 construction has not started on the project, with funding only secured in November 2022.^[168] The total costs of the project are estimated to be US$8.2 billion.^[169]

The upgrade plan involves doubling the track from Karachi to Peshawar, providing grade separation, as well as communications-based train control;^[170] this will allow increased capacity and faster trains on the line.^[171]

Main Line 2

In addition to upgrading the ML-1, the CPEC project also calls for similar major upgrade on the 1,254 kilometre long Main Line 2 (ML-2) railway between Kotri in Sindh province, and Attock in northern Punjab province via the cities of Larkana and Dera Ghazi Khan.^[172] The route towards northern Pakistan roughly parallels the Indus River, as opposed to the ML-1 which takes a more eastward course towards Lahore. The project also includes a plan to connect Gwadar, to the town of Jacobabad, Sindh^[173] which lies at the intersection of the ML-2 and ML-3 railways.

Main Line 3

Medium term plans for the Main Line 3 (ML-3) railway line will also include construction of a 560 kilometer long railway line between Bostan near Quetta, to Kotla Jam in Bhakkar District near the city of Dera Ismail Khan,^[174] which will provide access to southern Afghanistan. The railway route will pass through the city of Quetta and Zhob before terminating in Kotla Jam, and is expected to be constructed by 2025.^[162]

Khunjerab Railway

Longer-term projects under CPEC also call for construction of the 682 kilometre long Khunjerab Railway line between the city of Havelian, to the Khunjerab Pass on the Chinese border,^[174] with extension to China's Lanxin Railway in Kashgar, Xinjiang. The railway will roughly parallel the Karakoram Highway, and is expected to be complete in 2030.^[162]

The cost of the entire project is estimated to be approximately $12 billion, and will require 5 years for completion. A 300 million rupee study to establish final feasibility of constructing the rail line between Havelian and the Chinese border is already underway.^[175] A preliminary feasibility study was completed in 2008 by the Austrian engineering firm TBAC.^[176]

Lahore Metro

The Orange Line of the Lahore Metro is a significant commercial project under CPEC.^[177] This $1.6 billion project was initially planned to be completed by Winter 2017. However, the completion was delayed several times, and the line was finally launched on 25 October 20201. The Orange Line spans 27.1 kilometers (16.8 mi), with 25.4 kilometers (15.8 mi) being elevated and the remaining portion being underground between Jain Mandir and Lakshmi Chowk. The project has the capacity to transport 250,000 commuters per day, with plans to increase capacity to 500,000 commuters per day by 2025. As of now, the Orange Line of the Lahore Metro is fully operational.^[178] It is the first automated rapid transit line in Lahore, Punjab, Pakistan, and the first driverless metro in Pakistan. It is operated by the Punjab Mass Transit Authority and forms part of the Lahore Metro system.

Energy sector projects

Pakistan's current energy generating capacity is 24,830 MW.^[179] Energy generation will be a major focus of the CPEC project, with approximately $33 billion expected to be invested in this sector.^[57] An estimated 10,400 MW of electricity are slated for generation by March 2018 as part of CPEC's "Early Harvest" projects.^[60]

The energy projects under CPEC will be constructed by private Independent Power Producers, rather than by the governments of either China or Pakistan.^[180] The Exim Bank of China will finance these private investments at 5–6% interest rates, while the government of Pakistan will be contractually obliged to purchase electricity from those firms at pre-negotiated rates.^[181] In April 2020, hit by the COVID-19 pandemic, Pakistan asked China to ease repayment terms on $30bn worth of power projects.^[182][183]

Renewable-energy

In March 2018, Pakistan announced that hydropower projects would be prioritized following the completion of under-construction power plants.^[79] Pakistan aims to produce 25% of its electricity requirements by renewable energy resources by 2030.^[184] China's Zonergy company will complete construction on the world's largest solar power plant – the 6,500 acre Quaid-e-Azam Solar Park near the city of Bahawalpur with an estimated capacity of 1000 MW is expected to be completed in December 2016.^[185][186] The first phase of the project has been completed by Xinjiang SunOasis, and has a generating capacity of 100 MW.^[187] The remaining 900 MW capacity will be installed by Zonergy under CPEC.^[187]

The Jhimpir Wind Power Plant, built by the Turkish company Zorlu Enerji has already begun to sell 56.4 MW of electricity to the government of Pakistan,^[188] though under CPEC, another 250 MW of electricity are to be produced by the Chinese-Pakistan consortium United Energy Pakistan and others at a cost of $659 million.^[189][190] Another wind farm, the Dawood wind power project is under development by HydroChina at a cost of $115 million, and will generate 50 MW of electricity by August 2016.^[191] Zdroj:https://en.wikipedia.org?pojem=China-Pakistan_Economic_Corridor
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