In a major geopolitical shift, China has walked away from Pakistan’s most ambitious China-Pakistan Economic Corridor (CPEC) project, the Main Line-1 (ML-1) railway upgrade. The decision follows Pakistan Prime Minister Shehbaz Sharif’s recent visit to Beijing, where he failed to secure fresh funding or major projects under CPEC Phase-2. Instead, he returned with Memoranda of Understanding (MoUs) worth $8.5 billion, mainly in agriculture, electric vehicles, solar energy, health, and steel, but no headline investments.
At the same time, Islamabad’s warming relations with Washington, and India’s growing closeness with China and Russia after the Shanghai Cooperation Organisation (SCO) summit in Tianjin, have added a complex geopolitical backdrop to Beijing’s disengagement.
What is CPEC project?
The China–Pakistan Economic Corridor (CPEC) is a major infrastructure project aimed at connecting China’s northwestern Xinjiang region to Pakistan’s Arabian Sea port of Gwadar through a network of roads, railways, pipelines, and energy projects. CPEC spans approximately 3,000 km and forms a critical part of China’s Belt and Road Initiative (BRI).
The corridor is expected to enhance regional connectivity by linking South Asia, Central Asia, the Middle East, and Africa. It is intended to boost trade between China and Pakistan, facilitate Chinese energy imports, and foster economic growth, with investments estimated to exceed $60 billion.
