The following is based on a translation of a report in Chinese media:

Pakistan is regarded as a violent, lawless and run-down place with great risk of infiltration by Islamic extremists. It is in economic difficulties as few are willing to take a risk by investing in it.

However, according to quanzhan.com’s report on April 23, China has agreed to take the risk, if Pakistan agrees to some conditions.

Pakistani President Mamnoon Hussain told Chinese President Xi Jinping when they met on April 22 that the Pakistani government has approved a plan to establish an armed force of 10,000 personnel specialised in protecting Chinese workers in Pakistan.

China is providing a great deal of investment in Pakistan’s military to facilitate this.

That shows the high risks in investing in Pakistan. Xi is investing more than $ 6 billion in a country few in the world are willing to take risks in.

Chinese media says it is a political instead of a commercial investment, aimed at ensuring the safety of China’s trade lifelines to the Middle East and Europe.

Oil from the Middle East is a major concern, especially if there is conflict in the South China Sea or interference by India near the Malacca Strait.

Compared with China’s annual trade volume of around $700 billion with Europe and the Middle East, the $6 billion investment in Pakistan over several years is not a big amount.

Xi has also considered the risks and potential gains. The investment risks in Pakistan are mainly due to infiltration of the Taliban from Afghanistan in its fighting with US troops.

Xi believes when US troops leave Afghanistan, the Taliban will leave Pakistan.

China also hopes to assist Pakistan in addressing poverty and lack of education, which are the major causes of political instability.

China says it has the experience in bringing prosperity to poor and uneducated people, as it has shown from personal experience.

Additionally, Xi says, overseas Chinese were able to develop the economies and become rich in Southeast Asia when there was political instability there.

There is the chance for China’s success in doing so in Pakistan. The economic rewards will be quite substantial as labour is very cheap there. China is in dire need of cheap labour, as labour has become increasingly expensive in China.

Where there are risks, there is opportunity. Due to Pakistan’s strategic importance to China, Xi says he has to take the risks.

Source: qianzhan.com “What is China’s iron brother Pakistan? Pakistani President: There will be 10,000 troops to protect Chinese workers” (summary by Chan Kai Yee based on the report in Chinese)

Related articles