Gwadar Port Concession Agreement

China has not offered Pakistan a credit line for the development of CPEC infrastructure in the same way as India for Iran. [96] [97] Under the CPEC, China instead allocated $1.153 billion to finance construction projects and for the development of the port and adjacent areas. [98] One of the Chinese commitments made to Gwadar under the CPEC project is the construction of the East Bay Expressway project, $140 million to connect the port to the Makran Coastal Highway,[29] the installation of breakwaters in Gwadar Harbour, which will cost $130 million[26] a $360 million coal-fired power plant next to the port of Gwadar ,[99] a $27 million wharf dredging project in Gwadar [26] and a 300-bed, $100 million hospital in Gwadar. [29] A $114 million desalination plant will also be developed for drinking water consumption, while $35 million worth of infrastructure projects will be built around the Special Economic Zone. [31] China will also provide $230 million to Pakistan for the construction of a new international airport in Gwadar, which is expected to be operational by December 2017. [100] [to be updated] A floating liquefied natural gas facility will also be built in the port of Gwadar as part of the $2.5 billion Gwadar-Nawabshah segment of the Iranian-Pakistan pipeline. [8] In total, COPHC has contracts worth $1.02 billion for the expansion of the port. [23] In addition to the construction of nine berths and cargo terminals, several projects are also planned, financed by loans from Chinese state-owned banks. The Gwadar Port dredging project will deepen the approach channels to a depth of 14 metres from the current depth of 11.5 metres, at a cost of $27 million.

[26] Dredging will allow the mooring of larger vessels with a cargo capacity of up to 70,000 tonnes in the port of Gwadar[7], while the current capacity allows for a maximum of 20,000 DWT. [27] Future plans call for dredging of the port to a depth of 20 metres to allow for the docking of larger vessels. [28] A $130 million port port stopover is also included in the CPEC infrastructure development package for port infrastructure. [29] In December 2010, China proposed to the provincial government to build an additional 20 berths and make the port fully operational if the port was returned to china. In the event that China is exposed to hostile actions by a state or non-state actor, energy imports could be halted by the Strait of Malacca, which in turn would cripple the Chinese economy in a scenario often referred to as the “Malacca Dilemma”. [63] In addition to the vulnerabilities it faces in the Straits of Malacca, China is heavily dependent on shipping routes across the South China Sea, close to the Spratly and Paracel Islands, which are currently a source of tension between China, Taiwan, Vietnam, the Philippines and the United States. [67] [Note 1] The CPEC project will allow Chinese energy imports to bypass these disputed areas. [68] The Sino-Myanmar pipelines were also built by China to address the so-called “Malacca Dilemma.” [69] Gwadar`s potential to become a deep-water port was first identified in 1954, when the city was still under the sovereignty of the oma. [4] The port`s construction plans were not completed until 2007, when the port of Parvez Musharraf was inaugurated after four years of construction, costing $248 million. [5] President Zardari said that building infrastructure around the port would promote economic activity in Gwadar and Balochistan.