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06 Apr 2017

China Pakistan Economic Corridor: UK wants share of the cake

India's opposition to CPEC undermined by UK backing

Looking to be a key stakeholder in the multi billion dollar China Pakistan Economic Corridor (CPEC), the UK on Tuesday held a trade round table involving British and Pakistani diplomats, British companies and Chinese banks.

Hosting the round table, trade minister Greg Hands highlighted UK's willingness to capitalize on opportunities in the region.

UK will host a larger CPEC conference in May in Islamabad.

In context

India's opposition to CPEC undermined by UK backing
Britain and CPEC


Britain and CPEC

China and the UK "committed to support each other's commercial-cooperation in new markets", including CPEC which forms a part of China's Belt and Road Initiative, according to a 2015 joint statement.

Hands noted, "Britain is a country of free-trade influence and can be an important partner for China and Pakistan in delivery of huge infrastructure projects that are being planned between the two countries".

The CPEC UK roundtable

The round table was attended by Chinese, Pakistani and British diplomats alongside experts from CityUK and Royal United Services Institute. Firms including Deloitte and HSBC were also present. The meeting's agenda was - how British businesses can help deliver CPEC.

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The China Pakistan Economic Corridor

CPEC, is a $51 billion infrastructure development project sponsored by China in Pakistan. Linking Xinjiang in China to Gwadar in Balochistan, CPEC is also intended to modernize Pakistan's infrastructure and improve trade.

It involves key infrastructure development projects within transportation and energy.

India opposes CPEC as it passes through Pak Occupied Kashmir, while China defends it stating it improves lives of the local population.

Belt and Road Initiative

CPEC is part of the BRI, China's attempt to replicate ancient trade routes including the Silk Road. The idea is to establish relationships with countries in Asia, Middle East and Europe through trade and investments thereby increasing influence.


Implications for the region

The impending Brexit has clearly prompted a more cavalier British foreign policy approach. While UK hopes that joining hands with China here could potentially have positive gains elsewhere, they will have to deal with the fallout from India's inevitable unhappiness, as well as international pressure on the Balochistan question.

For India, continuing opposition to CPEC and BRI becomes tougher given waning international support.

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