Pakistan Institute of Development Economics


The SCO and CPEC

Publication Year : 2017
Author: Yasir Masood
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Pakistan has indisputably achieved a diplomatic feat with the acquisition of full-fledged membership in the Shanghai Cooperation Organisation (SCO) this month. The 17th summit of the SCO at Astana, Kazakhstan, on June 8-9 formally announced a new security architecture covering approximately 60% of Eurasia, with extensive implications for the entire world. With India and Pakistan officially attaining full membership of the organisation, the total population of the SCO countries will be almost 3.5 billion, which roughly accounts for half of the world, and the combined GDP is estimated to be exceeding 25% of the global GDP. Accordingly, the SCO is destined to become the cornerstone of economics and politics in Eurasia and a game changer on the global agenda.Pakistan’s SCO membership will strengthen its ability to seamlessly sail through an economic sea change, the result of landmark projects of the China-Pakistan Economic Corridor (CPEC). Since Pakistan’s flag has risen at Beijing, the headquarters of SCO, this may usher in a new era of economic and trade growth coupled with the success of CPEC. Both SCO and CPEC complement each other. Russian, Eurasian and Central Asian states are eyeing to partake in CPEC, and in return for participation in CPEC, Pakistan can tap minerals, gas and oil resources from these states to satisfy its energy needs. In fact, CPEC was an underlying reason for Pakistan’s entrance into the SCO, since infrastructure developments under CPEC will engender immense opportunities for the SCO member countries. In particular, landlocked Central Asian states will be privy to the shortest access to trade and economic routes through CPEC.Pakistan’s membership will give it influence in the global arena, and the SCO will serve as a platform for the expression of the country’s commitment to peaceful regional cooperation. At this multilateral forum, other members may also learn from Pakistan’s pursuit of the eradication of terrorism and extremism through a robust anti-terrorism apparatus. Moreover, on the strategic chessboard, this regional bloc offers two vital prospects for Pakistan’s foreign policy: first, it will present a positive and responsible image around the globe, and second, it will debunk contrived narratives centered on anti-CPEC rhetoric.Despite the current stalemate between Pakistan and India, meetings between both counterparts at the SCO can mitigate friction to some extent and leverage of China and Russia can also thwart India’s malicious designs of turning SCO into another Saarc. Pakistan and Afghanistan provide the shortest routes for India to connect to Central Asia and Eurasia. Myopic strategy towards “One Belt, One Road” Initiative (OBOR) and CPEC is not in India’s national interest, since it also envisages access to Central Asian markets and in exchange may utilise their oil and gas reservoirs. Pakistan may also enormously profit by becoming a secure transit route for goods and energy supplies from Central Asia to India and vice versa.It is an irrefutable truth that the security and stability of a state are a precursor to sustainable economic and trade development. Thus, the SCO is also a beacon of hope to resolve the ongoing conundrum in Afghanistan. This might only be possible if all member states formulate a multilateral approach for peace and stability whilst relinquishing unilateral interests. Currently, a resurgent Taliban coupled with strong presence of IS in Afghanistan can wreak havoc upon a regional and transnational spillover. Nevertheless, positive engagement at the SCO in partnership with the CPEC transit trade routes can help Afghanistan wriggle out of its current plight.To conclude, unity between the SCO and CPEC was memorably articulated by Prime Minister Nawaz Sharif in his speech at the summit. He said, “China’s OBOR initiative has transformed the global economic landscape. In Pakistan, we are diligently implementing CPEC. These mega projects will benefit the entire SCO community.”