Iran has joined the multi-trillion dollar China’s Belt and Road Initiative. In 2014, Pakistan also signed the $45 billion China-Pakistan Economic Corridor (CPEC), which was also part of the BRI, but the mega project has been stalled. The agreement with Iran is much bigger as China seeks a “permanent and strategic” long-term relationship with China.
The negotiations with China started five years ago amid intense secrecy as Iran was facing sanctions. Chinese President Xi Jinping visited Iran in 2016 and agreed to increase bilateral trade more than ten-fold to a whopping $600 billion in the next decade. No details of this 25-year-old agreement have been provided but it is expected to include investments in energy, infrastructure and military cooperation.
The BRI involves development and investment initiatives stretching from East Asia to Europe. It would significantly expand Chinese economic and political influence. This has raised concerns in the United States and President Biden has suggested a plan to rival the BRI. The US would certainly attempt to prevent China from becoming the most powerful country in the world. However, countries having a bitter experience with US imperialism are wary. Over 100 countries have signed agreements with China involving 2,600 projects at a cost of $3.7 trillion.
The situation is much different in Pakistan as several projects remain stalled due to the coronavirus pandemic as many Chinese engineers and technicians were forced to return back. Pakistan also remains without CPEC Authority after an ordinance lapsed and has not been replaced. Some projects have also been scaled as they are either too costly or seen as debt traps. China has also reviewed, cancelled or scaled-down some commitments.
Pakistan and China insist that CPEC projects are on track and will be expedited soon. But controversy has raised during the Chinese Foreign Minister’s visit to Iran where he said “some countries change their position with one phone call.” This is seen as a jibe at Pakistan who has not been able to formulate a strategy for the speedy implementation of CPEC projects.
Iran’s inclusion in the BRI will be seen with mixed reactions. Iran will benefit from turning east and the US will take an increasingly hostile approach. It will also benefit the region including countries such as Pakistan but critics say Iran may be given up too much in its quest to boost ties with China. Pakistan should also expedite efforts towards the completion of CPEC projects.