Domestic Actors and the Limits of Chinese Infrastructure Power: Evidence from Pakistan

Abstract

The Belt and Road Initiative (BRI) is important to China’s development vision. Under the BRI, Chinese policymakers have focused on exporting railway systems to developing countries, yet progress on some projects remains limited. This article focuses on delays associated with a planned railway project in Pakistan: the ML-1. It answers the following question: What explains delays in the ML-1 railway project despite strong Chinese interest in it? The article uses a two-step conceptual framework to answer this question. In the first step, it highlights the role of railway bureaucrats involved in project-level negotiations. It shows that local bureaucrats contribute to delays by actively negotiating technical parameters. Chinese firms have limited policy levers to ensure their acquiescence. In the second step, the article places delays in the context of Pakistan’s political economy by analysing the role of the political and military elite. It also explores the impact of political change and economic factors on the project. Projects not in sync with the local political elites’ development vision face delays. Domestic political changes also contribute to delays. Furthermore, a failure to gain major veto actors’ support, coupled with economic problems and differences over financing terms, constrains China’s ability to pursue large-scale projects.

Key Words:

• Belt and Road Initiative
• China–Pakistan Economic Corridor
• Local political economy
• Railways
• Transport Infrastructure

Acknowledgements

Fieldwork for this paper was undertaken while the author was a post-doctoral researcher at the University of Cambridge. The Isaac Newton Trust, University of Cambridge, and Cambridge-China Development Trust made extensive fieldwork possible. I would also like to thank the participants of the Assessment of China’s Belt & Road Initiative Seminar, University of Virginia organised in October 2021, for their comments on an earlier version of this article. The author also thanks the referees and journal editor for their valuable comments.

Notes

1 On the analysis of delays in Chinese infrastructure projects in Southeast Asia, see Kiik (2016) and Lim, Li, and Syailendra (2021).

2 For some of this literature, see Callahan (2016); Clarke (2017); Blanchard and Flint (2017); Chan (2018); Gonzalez-Vicente (2019); Johnston (2019); Carmody (2020); Clarke (2020); and Lin and Ai (2020).

3 The value of projects being undertaken as part of CPEC continues to evolve as some are added while others are removed from the list (Guanqun 2019).

4 The gauge size in British India was 5 ft 6 in.

5 PR freight operations compares poorly with neighbouring countries. In 2014–2015, Indian Railways transported 27% of freight in the country, and on average Indian Railways generates 70% of its revenue from freight transport (TERI 2019).

6 In 2014, China South Locomotive & Rolling Stock Corporation merged with China CNR Corporation Limited (CNR) to form CRRC Corporation Limited (CRRC).

7 In 2018, PR transported approximately 3.3 million tons of coal from Karachi to the coal-based power plant in Sahiwal District in Central Punjab under CPEC (Chinese SOE1 2019).

8 CANARAIL, now known as SYSTRA Canada, is an engineering and consulting firm specialising in providing transport solutions.

9 A dedicated freight train can carry freight volume equivalent to 72 trucks (RB3 2019). Energy consumption per ton/km of rail transport is half that of road transport (Looney 1998, 355, emphasis added).

10 Chaudhary (2019) says that the FWO has 10–12 subsidiaries working in different sectors. These subsidiaries are operated by civilians, but strategic decisions are taken by a military-dominated board.

11 There was no feasibility study shared for the bid or any financial data for how they reached the $4.5 billion figure. The names of the international firms were not shared.

12 Lahore–Sialkot Motorway Infrastructure Management (Pvt.) Ltd., a Special Project Company set up by the FWO, was awarded a 25-year concession to construct, manage, and maintain the Lahore–Sialkot motorway (Lal, 2019).

13 One reason for the increase in imports that contributed to the balance-of-payments crisis was the implementation of import-intensive China–Pakistan Economic Corridor projects (ADB 2020, 21).

Additional information

Funding

Funding from the Isaac Newton Trust, the University of Cambridge and the Cambridge-China Development Trust is gratefully acknowledged.