POLITICO-ECONOMIC SIGNIFICANCE OF GWADAR PORT: IMPLICATIONS FOR REGIONAL INTEGRATION

Abstract

“Whoever controls the Indian Ocean dominates Asia. This Ocean is key to the seven Seas in the twenty first century, the destiny of the world will be decided in these waters” stated US Rear Admiral Alferd Thayer Mahan. This indicates geo-strategic importance of Indian Ocean. Pakistan is located on the Indian Ocean which connects the landlocked Central Asian Republics with the Sea. Gwadar is a coastal town of Baluchistan, a province of Pakistan, which remained a part of Oman for more than 150 years i.e., 1784 to 1958. Later on, due to its significance, it was bought back by Pakistan with payment of £ 3 million. The city came under the limelight of Pakistan’s policy makers as 35 % of international oil is transporting near it. It was visualized as a hub port for the region when it became part of Pakistan, but financial and technical issues prevented the dream to be materialized. The project remained in papers until China promised to provide financial assistance. The former president of Pakistan Parvez Musharraf during his visit to China in May 2001, requested Chinese government to help in the project. On 22nd March 2002, the project was inaugurated by Pakistan’s president Musharraf and Chinese Prime Minister Wu Gang Guo. The port was then handed over to Port Singapore Authority on 6th February 2007 after its completion in 2006. Port Singapore Authority failed to upgrade the port on promised lines 18th February, 2013 the port was handed over to Chinese Overseas Port Holding Company (COPHC). The geography of the port has attracted the players because of which the situation worsened. The economic potential of the port is the key interest for these players. The port could also be used as naval base in time of exigencies. Situation of confusion would arise in case of converting of Gwadar port into a naval base either by China or USA. Overlapping of economic, political and strategic interests of the involved actors make the area very sensitive. Iran and India have their own plan of action in the region. There is another challenging confusion engineered by China and USA with the clash of their interest in the region that could be reduced or subsided by the frequent use of diplomatic channels. China and USA, under the paradigm of their policies, are promoting their interests in the region and there will be collaboration in future. Landlocked Central Asia and Afghanistan are depending on the port to marketise their resources. Conventional theory of integration defines regional integration as a trade creation and the port has the ability to create trade. Trade creation means shifting of local production with a high cost to member nations low cost products in a regional block. Generally, economic integration is the outcome of an evolutionary course of regional cooperation. European Union is the best example which became a political Union after completion of its economic integration. In order to bring regional countries on a single platform, different steps like free trade zones and tax relaxation are taken by the respective governments; these would be followed by steps like open border system common currency and extended people to people contacts in the region in future. CPEC is the best example of these steps. Iran, a strong competitor wants to be a part of the project. TAPI, IPI and TAP are the proposed projects which when materialized will bring integration to the regional countries. The port at Gwadar is located at the confluence of two main regions, the oil rich Central Asia and emerging consumer market South Asia. The port is located on a point which provides a strategic depth to Pakistan against her adversaries. The port has the ability to check Sea Lanes of Communication during war and peace. Due to geo-strategic importance of the port, all regional and extra-regional players have keen interest in it. Central Asia hopes to export its riches through it while United States of America with diverse demands wants to ensure its presence there. Each player has its own objectives with different approach to accomplish. Having tremendous importance, the port has become a flash-point and Pakistan has to reconsider the situation in terms of its priorities. Major objectives of the study are to expose economic and strategic importance of Gwadar port and to find out its impacts on regional integration. To achieve the mentioned objective, empirical, descriptive, analytical and predictive methodology is applied. The bulk of the study attained through the analysis of documents, books, electronic journals, and scholarly papers, including textual interpretation or ‘content analyses’ as well. Textual interpretation used to summarize, and identify the main properties of the text; and then evaluate the text. This research concludes that cooperation among the concerned states and peace in Afghanistan would bring economic integration in the region which would automatically be followed by political harmony among the regional countries. One important recommendation in this regard is that Pakistan has to formulate policies to avoid confrontation of major players and all the related players. Especially, the potential powers should accommodate each other’s interests in the larger interest of the region.