Why is Pakistan risking Chinese anger by courting Saudi Arabia on CPEC?

Just last week we had written about Prime Minister Imran Khan’s trip to Saudi Arabia and whether Pakistan would send troops to Yemen in order to obtain economic assistance ‘Will Imran Send Troops to Yemen to Get $$$ from Saudi.’


Soon after Pakistan announced that Saudi Arabia would join CPEC (China Pakistan Economic Corridor) and then 48 hours later Pakistan announced that Saudi Arabia would not be joining CPEC.


This decision was an attempt by Pakistan to diversify the number of countries that are aiding Pakistan and also seek to reduce the huge loans that will incur as part of CPEC. However, Beijing was not consulted before Islamabad made the announcement and China was not pleased, so Pakistan had to reverse this decision.


According to a recent piece in SCMP, Imran Khan’s government is using “CPEC as a bargaining chip in Pakistan’s complicated, ill-managed relationships with other key partners.”


First, Pakistan “reduced the potential value of the CPEC program to US$50 billion by 2030, down from US$62 billion. In one fell swoop, it decided to starve the western overland route from Xinjiang to the Chinese-operated Arabian Sea port of Gwadar of funding.”


Second, Pakistan invited Saudi Arabia to join CPEC and “develop a massive refinery complex at Gwadar.” Beijing “had no idea the Khan administration was seeking to leverage Gwadar to persuade the Saudis to provide Pakistan with oil on a deferred-payment basis, so as to ease the pressure on its forex reserves and reduce the amount it would need to borrow from the IMF.”


According to Tom Hussain, the reason for this policy is “duplicity” Pakistan “is uncomfortable with the prospect of becoming the focal point of an economic confrontation between the US and China that threatens to escalate into a 21st-century cold war. It has also noted that talks are under way to bring India into the fold of the counter-belt-and-road fund recently launched by the US and Japan, and that the European Union has unveiled similar plans to resist China’s economic expansionism. Pakistan’s economic and strategic circumstances simply do not accord it the luxury of taking sides in a stand-off between behemoths, all of which it is beholden to.”

Ironically, Pakistan also faces charges of duplicity from Saudi Arabia for failing to support the Kingdom in its confrontation with Iran.

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