Pakistan gives Gwadar port to China for operations

February 5, 2013

Pakistan has handed over the operations responsibility of its strategically located Gwadar port to China’s Overseas Port Holdings. Previously it was with Singapore’s PSA (Port of Singapore Authority) International.

Why the port offered to China?

There occurred some discords b/w the PSA International and Pakistani navy over land transfers, security issues and lack of infrastructure which led to PSA withdrawal from the contract.

Advantages and Disadvantages for China:

Handling operations of Gwadar port will be not easy for due to the worsening security situation in Balochistan opposition fron Baloch people. The turbulence in Afghanistan which is going through transition is also likely to affect it. Gwadar was built by China but during its operation by PSA, it barely attracted any commercial traffic. There is also a lot of port development that remains to be built.

China can use the port to transport fuel into northwestern China, by transporting oil and gas from the port through pipelines that traverse Balochistan and the federal agencies to feed into China’s Xinjiang province. As China’s oil imports increase, it would prefer to insulate its energy transports from the troubled waters of the Straits of Malacca and the South China Sea.

China transports 60% of its oil through the Straits of Hormuz. Having Gwadar under its command would change the security dynamics for China.

Furthermore, if we go by the strategic perspective of ‘String of Pearls’ then the move will strengthen China’s objective to have an ideal staging ground for its ships. China already has a firm bearing in Sri Lanka’s Hambantota port, it is attracting Maldives, though no port presence is planned yet. China is also creating a port in Chittagong, Bangladesh, as well as Sonadiya, near Cox’s Bazar.

What Pakistan gets here?

Pakistan expects China to develop the port further and turn it into a naval base.

Why India is concerned?

This development in Pakistan may have significant implications for India as the country thinks it is China’s attempt to encircle India (String of Pearls) and gain strategic advantage in the region. India has apprehensions that these ports could be used for military purpose as well.

It may be to counter this India has bolstered its relations with Oman, though there is no security presence there yet. India has been stressing to develop the Iranian port of Chahbahar.

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