Pakistan Reader# 574, 3 April 2023
Ankit Singh
On 3 April, The Express Tribune reported that China has opened traffic through the Khunjerab pass located in Pakistan-occupied Kashmir. The pass is a critical junction connecting Kashgar in China to the rest of Pakistan including the Gwadar and Karachiports. The pass is also critical for the success of the Quadrilateral Transit Trade Agreement between Pakistan, China, Kyrgyzstan and Kazakhstan.
The Khunjerab pass is used for commercial trade activities and is operable from April to November every year. The route was shut since the pandemic began. Prime Minister Shehbaz Sharif termed the occasion a welcome one for boosting trade with 'Iron brother China' and expressed his resolve to move ahead on CPEC with dual speed. The reopening of the trade route will be productive provided the business sentiment and intensity is profitable.
The following three points are important in analysing the opening of the Khunjerabpass
1. China-Pakistan trade balance
In its annual report (FY22), Trade Development Authority Pakistan (TDAP) indicates that China is the biggest second major export destination for exports from Pakistan (USD 3.095 billion) and China is the largest importer to Pakistan (USD 20.839 billion). Pakistan’s exports to China could only make up to 7 per cent of the World export of Pakistan in 2017, while China made up over 29 per cent of Pakistan’s total imports in 2016. There is over-reliance on China and in the same context, the Khujerab pass would yield returns if the export competitiveness of Pakistan improves along with the Chinese intent of localising its trade intensity.
2. Broader geo-economic goals
Quadrilateral Transit Trade Agreement (QTTA) between Pakistan, China, Kyrgyzstan and Kazakhstan was signed in 1995 to facilitate transit traffic and trade. It aims to provide access to Pakistan’s ports for landlocked countries of central Asia. The transit bypasses Afghanistan which has been unstable for sustainable development since the 1990s. Tajikistan also became a formal member of QTTA in 2017. Pakistan is working with Central Asia on two energy projects, one with Turkmenistan for gas import and another with Tajikistan for electricity purchase. Beijing also wants to reach Central Asia through the CPEC.
3. Chinese interest in jointly patrolling the pass
As the reordering of global order takes place, there are hotspot regions prone to armed confrontation and conflicts. And Line of Control (LoC) and Line of Actual Control (LAC) are prone to such conflicts owing to sweeping narratives and a lack of collective voices and actions. Recently, the US Annual Threat Assessment stated an elevated risk of armed confrontation between India and China that might involve direct threats to American persons and interests.
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