New Gwadar International Airport: An asset for Pakistan or a new economic burden for China?

On the sidelines of the recent Shanghai Cooperation Organization (SCO) summit in Islamabad, Pakistan and China signed 13 agreementscovering a range of sectors including security, livelihoods, education, agriculture, human resource development, and science and technology. The highlight of the meeting, however, was the virtual one inauguration by Pakistani Prime Minister Shehbaz Sharif and his Chinese counterpart Li Qiang from the New Gwadar International Airport.

Built for a price of $230 millionThe airport is one of the projects under the $50 billion China-Pakistan Economic Corridor (CPEC). It extends over an area of 17 square kilometers and is touted as Pakistan’s second largest airport, designed to accommodate some of the world’s largest aircraft including the ATR 72, Airbus A-300), Boeing 737 and Boeing 747. The airport is expected to have approximately Create 3,000 jobs.

The location of the airport in the sparsely populated province of Balochistan, specifically in Gwadar district, which is a little over 100,000, raises several questions about the airport’s ability to attract passengers and freight traffic. Without sufficient demand, the airport risks becoming an underutilized airport, similar to the one financed by China Mattala Rajapaksa International Airport in Sri Lanka. Given these concerns, it is essential to first assess how this project fits into the broader CPEC.

The primary idea behind the construction of the airport was to increase connectivity and facilitate the movement of aircraft load to and from Gwadar, especially the seaport. It was also intended to support the flow of people as business activity increases. By functioning as a hub for both commercial flights and cargo aircraft, the airport is expected to attract potential investments and boost commercial growth at Gwadar Port, which is at the heart of the CPEC initiative. It is also expected to facilitate connections to markets in China, South Asia and the Middle East. This is directly in line with CPEC’s broader vision to make Gwadar a major trade and transportation hub.

While this vision may sound promising, there is skepticism about the practicality and viability of such a large-scale airport in a relatively isolated region.

Karachi and Quetta, the nearest major cities, are over 600 and 700 kilometers away respectively, raising questions about how effectively the airport can serve its broader purpose, especially without improved connections to urban centers.

A major challenge is the lack of rail connections. All over the world, railway networks are used for moving freight. Rail transportation is generally more efficient in terms of fuel consumption and costs, and allows the transportation of large quantities of goods without the delays and congestion that often occur on highways.

However, Gwadar is currently dependent on a single major highway to Karachi, and another to Quetta via Turbat, both of which are heavily congested by passenger and freight traffic, often exceeding their capacity. To fully realize the intended vision of the airport under CPEC, it is necessary to establish a multi-modal transportation network with rail links.

While infrastructure can be developed over time to meet emerging needs, the bigger and more pressing challenge is that of security. Balochistan has long faced unrest, accompanied by complex tensions, insurgencies and political grievances.

Earlier this month there were at least 10 people, including two Chinese engineers, were killed in Karachi. Such attacks are part of a disturbing trend of targeting CPEC and other projects and workers. In fact, almost 100 Chinese nationals have lost their lives in terror attacks in Pakistan since the establishment of CPEC.

While both China and Pakistan have repeatedly committed to improving security measures for Chinese personnel and Chinese projects – they also reiterated this pledge at the recent SCO meeting – questions remain about how these commitments can be implemented on the ground. The ongoing insurgency in Balochistan, along with unresolved discontent over the management of local resources, continues. This discontent has not been addressed in the past two decades and has only escalated tensions, complicating the situation and endangering the safety and viability of ongoing projects.

Nevertheless, China continues to invest in Gwadar, given its strategic location and long-term potential. Yet the ability to attract and retain more investment for infrastructure projects such as rail networks, and connections to markets outside Pakistan for the seaport and new airport, depends heavily on addressing security concerns, especially as China has already expanded the scope and scale of BRI is shrinking. through his new “Small and beautifulstrategy.

For the first time in the past thirty years, China is experiencing a net outflow of foreign direct investment. Amid ongoing real estate crisiscame to a standstill after the pandemic economic recoveryrising debtand other economic pressures, the public sector is now struggling to manage large infrastructure projects. As a result, Beijing may consider strategically choosing where to invest to ensure greater returns and stability.

As China reassesses its investment strategies and Pakistan grapples with ongoing security challenges, the future of Gwadar’s new international airport remains uncertain. Whether it will support economic growth, or succumb to the same fate as many other grand initiatives that have been underutilized and could potentially be labeled a ‘white elephant’ remains to be seen.