Gwadar has come a long way from being just a telegraph station with a lonely, stunted tree in the nineteenth century3 or an underdeveloped fishing village in the twentieth, to potentially becoming one of the great cities of the world in the twenty-first century. According to Robert Kaplan, ‘If we can think of great place names of the past—Carthage, Thebes, Troy, Samarkand, Angkor Wat—and of the present—Dubai, Singapore, Tehran, Beijing, Washington—then Gwadar should qualify as a great place name of the future.’ However, he warns that one key to Pakistan’s fate would be the future of Gwadar, ‘whose development will either unlock the riches of Central Asia, or plunge Pakistan into a savage, and potentially terminal, civil war.’ He adds that history is as much a series of accidents and ruined schemes as it is of great plans. Whether Gwadar becomes a new silk-route nexus or not is tied to Pakistan’s own struggle against becoming a failed state.4
At present, however, such a ‘great place name’ is conspicuous by its absence. According to Abdul Wali, writing in the Nation in 2016, ‘Presently, Gwadar has no water, decent schools, hospitals, a college for girls, or even a single university, let alone internet facilities; so, could it be a future mega city?’ Gwadar’s girls study in the boy’s college in the evening shift; there is no university; there is a serious water crisis and the desalination plants don’t work.5 Farrukh Saleem, quoting the Pakistan Bureau of Statistics, wrote in September 2016 that Gwadar had a total of 33,680 housing units of which only 20 per cent were pucca; only 35 per cent had electricity; only 45 per cent had piped water and only 0.86 per cent had gas for cooking. A hospital operated by the Gwadar Development Authority had been lying idle for the past eight years.6
Gwadar and Oman
In the middle of the eighteenth century, Mir Nasir Khan, the Khan of Kalat, captured Gwadar and its surrounding areas after defeating the Gichkis and included it in the Khanate of Kalat. The local Gichki chief was, however, allowed to maintain administrative control of the area, in return for providing half the revenues. Meanwhile, Sultan bin Ahmad of the Al Said dynasty of Muscat escaped to Gwadar from Muscat in 1783 due to an internal power struggle with his brother. On arrival in Gwadar, he asked for Nasir Khan’s help. Resultantly, in 1784 Nasir Khan handed over Gwadar to him for his maintenance with the understanding that the area be returned to Kalat when the Sultan acquired the throne of Muscat. Sultan bin Ahmad ascended the throne of Muscat in 1797 but did not return Gwadar to Kalat. He appointed a wali (governor) and ordered a fort to be built there. The ensuing struggle for Gwadar between the heirs of Sultan bin Ahmad and the Khan of Kalat allowed the British to intervene. After extracting concessions from the sultan for the use of the area, the British facilitated Muscat to retain Gwadar.
The British built the first ever telegraph link between Karachi and Gwadar in 1863 as part of the Indo-European Telegraph. A post office was opened in 1894 and Gwadar became a port of call for British steamers and an important base for flying boat operations.
Though the Khans of Kalat continued to reiterate their claim on Gwadar, nothing materialized since the area was under British control. In British strategic calculations, a foothold on the mainland was critical in case India became unfriendly. Surveys had also indicated the presence of oil in the area and the British realized that Gwadar could be an important port in the future. A British–American company, India Oil Concessions Ltd, was awarded a contract for oil exploration in 1939, but due to the outbreak of the Second World War, the work was suspended. The British foreign office was also unsure about independent India joining the Commonwealth and so felt that it was in their interest to keep the area under Muscat with whom they had exclusive agreements.
These agreements not only allowed Britain to use Gwadar for military and other purposes but also restrained the sultan from selling or leasing the areas under its dominion to any state other than Britain. Thus, even after its creation, Pakistan had to approach the British government for the purchase of Gwadar rather than talk directly with Muscat as two sovereign governments.
In 1954, Pakistan engaged the United States Geological Survey (USGS) to conduct a survey of its coastline. The USGS deputed the surveyor, Worth Condrick, for the survey who identified the hammerhead-shaped peninsula of Gwadar as a natural and suitable site for a new deep-sea port. This prompted Pakistan to start pressing for the return of Gwadar. Britain continued to discourage the deal till August 1958, when it finally allowed the transfer of Gwadar through a secret agreement. The agreement paved the way for purchase of Gwadar from the sultan and several concessions.
According to the agreement, if oil was found in commercial quantities in Gwadar, the government of Pakistan was bound to pay a percentage of total revenues to the sultan. Other provisions included retention of citizenship of Muscat by the residents of Gwadar without prejudice to any rights enjoyed as citizens of Pakistan; facilitation in recruitment from the area for the sultan’s armed forces; training facilities for military personnel in Pakistan’s technical schools, etc.7 Gwadar formally became part of Pakistan on 7 September 1958, after 174 years of Omani rule.
Addressing the nation on Radio Pakistan on the occasion, Prime Minister Malik Feroze Khan Noon stated: ‘I welcome the residents of Gwadar into the Republic of Pakistan and I would like to assure them that they will enjoy equal rights and privileges along with all other Pakistan nationals irrespective of considerations of religion, caste or creed. They will have their full share in the glory and prosperity of the Republic to which they now belong.’ (Words, no doubt, that the residents of Gwadar, along with other Baloch, would wince at now.) He also thanked the British government ‘… for their assistance and help in bringing to a successful conclusion our negotiations with His Highness the Sultan of Muscat and Oman for the transfer of his rights in Gwadar. The negotiations were pursued with great vigour during the last six months and at every stage we received valuable advice from Her Majesty’s Government in the United Kingdom.’8
At the time Gwadar was a small and underdeveloped fishing village with a population of a few thousand. After its incorporation, Gwadar was made a tehsil (sub-district) of Makran district in the erstwhile West Pakistan Province. Later it would become a district when Makran was upgraded into a division.
History of Gwadar’s Development
Since the port’s acquisition in 1958 from Oman, Pakistan has been making grand plans for its use. During the presidency of Ayub Khan in the 1960s, the thinking was to develop Gwadar as an alternative to Karachi. Gwadar, along with the port of Pasni to the east, was seen as making Pakistan a great Indian Ocean power. However, given the economic conditions of the country, such plans remained on paper.
In the 1970s, Z.A. Bhutto unsuccessfully sought to interest the US in the development of the port and offered it to the US Navy. The offer was repeated in 1974 but the US remained disinterested. In 1980 the former chairman of the US Joint Chiefs of Staff Admiral Thomas Moorer advocated the setting up of a naval base in Gwadar.9 However, the proposal did not get much traction.
In the 1980s the Russians evinced an interest, seeing Gwadar as the warm-water outlet to the sea that they had been looking for long. It would have allowed them to export the mineral wealth of Central Asia. However, these plans floundered as they were unable to establish control over Afghanistan. In 1988 Belgium tried its hand at developing Gwadar harbour but the port could not attract much traffic.10
In the 1990s with the collapse of the Soviet Union, there was a scramble to position Gwadar as a transit point for the newly independent Central Asian Republics (CARs). Nawaz Sharif in his first term and Benazir Bhutto in her second term tried to give Gwadar high visibility and billed it as the gateway to the CARs. Once again, nothing much happened. In his second term Nawaz Sharif signed an agreement with the China Harbour Engineering Corporation (CHEC) for building the first phase of the Gwadar deep-sea port. The plans were, however, derailed following Gen. Pervez Musharraf ousting him in a coup in October 1999.
The project was finally put on track in
May 2001 during the visit of Chinese Premier Zhu Rongji who approved Chinese funding for developing Gwadar as a deep-sea port. As per the agreement, China would provide $250 million and Pakistan $50 million for the construction. The construction work was inaugurated in March 2002. In June 2006, the first phase was ready.
The management of the port was handed over to Port of Singapore Authority (PSA) for forty years in February 2007.11 PSA undertook to invest $550 million over five years to develop the port further. According to former senator and current member of the Balochistan Assembly Sanaullah Baloch, the government deliberately misled the media and the public to create the impression that the Port of Singapore Authority was taking over Gwadar. However, according to him, the name ‘Port of Singapore Authority’ does not appear anywhere in the concession agreement signed in 2007. Instead, it was a three-week-old company PSA Gwadar Pte Ltd. The company did not even exist at the time of bidding; the bidding was done by its ‘sponsors’.12
The port did not get off to a smooth start. The first ship—Post Glory—that arrived in March 2008 carrying a wheat shipment from Canada could not berth. The 14-metre draft at the time of the official opening of the port in March 2007 had reduced to 12.5 metres due to silting. Another ship had to be hired to unload some of the wheat to lighten the Post Glory. The then shipping minister Qamarruzzaman Kaira had to confess that the port would take three years to become operational as it lacked the required infrastructure, communication network and utilities.13 Despite this, the port was declared ‘fully functional’ in December 2008.
There was a lot of criticism of the PSA operations. Ultimately, on 30 January 2013 just before the general elections, the PPP government handed over the port operations to the China Overseas Ports Holding Company Ltd (COPHCL). As per the agreement, COPHCL would execute the port’s affairs through its three main companies: Gwadar International Terminal (GIT), Gwadar Marine Services Ltd (GMS) and Gwadar Free Zone Company Ltd. (GFZ). GIT would be responsible for handling business-related matters, GMS would provide port services and GFZ would develop and provide allied facilities to the investment companies in the free-zone area. After the formal handover of the free-trade zone, only the Chinese authorities would carry out all business affairs of the port.14
Strategic Location
Gwadar’s potential is based on its location on Balochistan’s Makran coast some 250 nautical miles from the Strait of Hormuz through which 40 per cent of the world’s oil supply flows. Gwadar is the outlet for the China–Pakistan Economic Corridor (CPEC), providing the landlocked Xinjiang Province of China with commercial access to the Persian Gulf. It also has the potential to become a regional transit hub for trans-shipment of goods for Central Asia, apart from being an alternative to Karachi port.
Apart from trade, the port has important strategic implications for Pakistan. It is located 450 km farther from the Indian border than Karachi. At present, Karachi handles the overwhelming bulk of Pakistan’s sea-borne trade. Gwadar, it is expected, will reduce the congestion at Karachi. It will also make it that much more difficult for India to blockade it, like it did in 1971 and threatened to do so again during the 1999 Kargil crisis. Consequently, the Gwadar port will provide Pakistan with crucial strategic depth along its coastline.
By making Gwadar the pivot of regional trade Pakistan claims that it would attract considerable investment into its most underdeveloped province, Balochistan. Theoretically, these funds would allow for the construction of roads and rails linking the coastal region to the rest of Pakistan, Iran and Afghanistan; would exploit the region’s vast and unexplored natural resources; and would allow for the socio-economic uplift of the local Baloch through various development projects. While sounding good on paper, the reality is quite different.
Chinese Interest
Apart from a gateway to the Arabian Sea, Gwadar will provide Beijing with a listening post to monitor the strategic sea links as well as military activities of the Indian and American navies in the region. It will also provide dual-use civilian–military facilities that can be used as a base for Chinese ships and submarines. A Chinese presence at Gwadar would allow China to ensure the security of its energy-related shipments along existing routes.
A decade ago, when Musharraf offered Gwadar to the Chinese to build a port, the model was Dubai. The Chinese model for Gwadar is not Dubai but their own port of Shenzhen. Zhao Lijian, the deputy Chinese ambassador to Islamabad stated, ‘Thirty-five years ago, Shenzhen was just a fishing village, like Gwadar. It has been transformed into a modern industrial city.’ The challenges, however, are immense. Shenzhen’s success to a great deal was due to its location next to Hong Kong whose GDP is greater than Pakistan’s. Gwadar is 450 km from the nearest major city, Karachi.15
Many security analysts see Gwadar as an integral component of the so-called ‘string of pearls’ strategy of China. Interestingly, the Americans had coined the expression ‘string of pearls’ and not the Chinese. The US consultants Booz Allen produced a report called ‘Energy Futures in Asia’ for the US Defense Department in 2004 and, according to the Washington Times, postulated that ‘China is building strategic relationships along the sea lanes from the Middle East to the South China Sea in ways that suggest defensive and offensive positioning to protect China’s energy interests, but also to serve broad security objectives.’ The report listed two of the pearls as Chittagong and Gwadar before speculating about eavesdropping bases, a canal in Thailand, an oil pipeline in Burma and a railway line in Cambodia. Since then the ‘string of pearls’ idea has caught the imagination of strategists and is seen as a strategy to encircle India. The Chinese projects include: Sittwe in Myanmar, Chittagong in Bangladesh, Hambantota in Sri Lanka, Marao in the Maldives and Woody Island near the Paracels.16
Yuan as Legal Tender
In a meeting of senior officials held in Islamabad on 20 November 2017 the Chinese side proposed making the Yuan legal tender in Gwadar. This was indeed intriguing. If it was about helping the Yuan become an international currency, why should it be legal tender only in Gwadar and not in the rest of Pakistan?17 For the present, Pakistan has turned down the proposal arguing any such move would compromise its ‘economic sovereignty’.18 However, this is clearly not the last that has been heard on the subject.
Baloch Perspective
As early as 2003, when the construction of the Gwadar port was in its early stages, there was much public agitation. The HRCP reported that the main grounds of criticism were: exclusion of the people and their representatives from the planning and execution of the project; denial of due opportunities of employment; apprehensions about the motives of the federal government and the military leadership; land-grabbing and fear of change in Makran’s political status; and fear of ethnic imbalance in Gwadar and of the Baloch being turned into a minority in the region. Additional concerns were irregularities in settlement of land titles, neglect of the traditional interests of the fishing community, indifference to the rights of the people threatened with displacement, inadequate representation of the local people in the new workforce, and the local community’s fears of being swamped by settlers from other parts of the country.19 These very same arguments are heard even today except that they are more strident. Clearly, nothing has been done in the past fifteen years to address any of these issues.
In a typically ham-handed manner, reflecting the insensitivity and arrogance of the federal government, the ordinary Baloch have been alienated by not being consulted about the project; and by not being given a stake in it, and are unlikely to be the beneficiaries of the project. The project is run entirely by the federal government and only a few Baloch have been employed in its construction. These are primarily unskilled labour, though even here a lot of such labour has been imported together with skilled workers like engineers.20 Gwadar has, thus, become for the Baloch a symbol of how wrongly they have been treated.
Then there is the issue of control of the port between the provincial and the federal governments. The federal gover
nment has been running the show in Gwadar despite the Eighteenth Amendment and devolution of powers to provinces. Some crumbs have been given to the provincial government like making its nominee the chairman of the port authority. However, critical decisions remain with the federal government. Therefore, the Baloch feel threatened by the project. As the Balochistan National Party-M (BNP-M) chief Sardar Akhtar Mengal put it: ‘The rights of Baloch people cannot be protected and the dream of a prosperous Balochistan cannot come true unless the control of Gwadar port is handed over to the province.’21
The revelation about the details of the forty-year agreement with China for the operations of Gwadar port has further increased criticism in Balochistan. The then minister for ports and shipping, Mir Hasil Khan Bizenjo, informed the Senate that under the agreement, the Chinese company, China Overseas Port Holding Company (COPHC), would carry out all the development work on the port and, as per the concession agreement, would be entitled to 91 per cent of revenue collection from the gross revenue of terminal and marine operations and 85 per cent from the gross revenue of free-zone operations. The balance would be the share of the federal government, with Balochistan getting no revenue from the port till 2048.22
Around the same time, Sri Lanka handed over its southern port of Hambantota to China on a ninety-nine-year lease. This had to be done after it failed to repay its debts to China. This development also rang alarm bells in Pakistan in general and Balochistan in particular. The fear is that Gwadar will eventually meet the same fate as Hambantota if Pakistan failed to repay the Chinese debts.23
Baloch nationalists feel that the project will adversely alter Balochistan’s demography due to the influx of non-Baloch to take up prime jobs and make them a minority in their own province. However, figures vary. According to the Gwadar Development Authority, as per the plan, the existing 80,000 population, mostly fishermen, will be joined by another 2 million people over the next twenty years, including 20,000 Chinese residents. However, the Baloch apprehend that Gwadar from its current population will become a city of 10 million people, bringing major changes in the demography of the province. Baloch fears were confirmed by advertisements in the national and even international media inviting investment into Gwadar city that was initially visualized for 2.5 million people but later raised to 5 million. Given that the entire population of Balochistan (including the Pashtuns) is about 6 million, Baloch apprehensions of being converted into a minority in their own homeland and their identity being eroded are clearly justified.24
Pakistan- the Balochistan Conundrum Page 19
