China assumes control of Gwadar Port China has taken control of Pakistan s Gwadar Port located at the mouth

of the Pers ian Gulf just outside the strategically important Strait of Hormuz. Previously, the control of the port was with Port of Singapore Authority (PSA) which was rec ently transferred to the China Overseas Port Holding Company. Gwadar Port Why the port offered to China? What are the Advantages and Disadvantages for China? What Pakistan gets here? Why India is concerned? Chahbahar Port Why Afghanistan needs to use port of Iran? Strategic location of Chabahar port. What is the India s role in this whole gambit? Why the deal b/w Iran and Afghanistan will be a win-win situation for Afghanista n, India, Iran and also for US? But, what India may lose in this ploy? China assumes control of Gwadar Port: Pakistan has handed over the operations re sponsibility of its strategically located Gwadar port to China s Overseas Port Hol dings. Previously it was with Singapore s PSA (Port of Singapore Authority) Intern ational. The port which has been bragged as Pakistan s biggest infrastructure project, has failed as a business venture till date because the security situation in Balochi stan discouraged PSA from investing in the development of the port and off-shore infrastructure. Besides, the government had also failed to transfer 584 acres u nder Navy s possession to the port. All these reasons forced PSA to move out of the 40-year management, operation, m aintenance and development contract. The issue of land transfer is still unresol ved despite the federal and provincial governments offering land elsewhere in li eu to the Navy. Why the port offered to China? There occurred some discords b/w the PSA International and Pakistani navy over l and transfers, security issues and lack of infrastructure which led to PSA withd rawal from the contract. What are the Advantages and Disadvantages for China? Handling operations of Gwadar port will be not easy for due to the worsening sec urity situation in Balochistan opposition fron Baloch people. The turbulence in Afghanistan which is going through transition is also likely to affect it. Gwada r was built by China but during its operation by PSA, it barely attracted any co mmercial traffic. There is also a lot of port development that remains to be bui lt. China can use the port to transport fuel into northwestern China, by transportin g oil and gas from the port through pipelines that traverse Balochistan and the federal agencies to feed into China s Xinjiang province. As China s oil imports incr ease, it would prefer to insulate its energy transports from the troubled waters of the Straits of Malacca and the South China Sea. China transports 60% of its oil through the Straits of Hormuz. Having Gwadar und er its command would change the security dynamics for China. Furthermore, if we go by the strategic perspective of String of Pearls then the mov e will strengthen China s objective to have an ideal staging ground for its ships. China already has a firm bearing in Sri Lanka s Hambantota port, it is attracting Maldives, though no port presence is planned yet. China is also creating a port in Chittagong, Bangladesh, as well as Sonadiya, near Cox s Bazar. What Pakistan gets here? Pakistan expects China to develop the port further and turn it into a naval base . Why India is concerned? This development in Pakistan may have significant implications for India as the country thinks it is China s attempt to encircle India (String of Pearls) and gain strategic advantage in the region. India has apprehensions that these ports cou

ld be used for military purpose as well. It may be to counter this India has bolstered its relations with Oman,though the re is no security presence there yet. India has been stressing to develop the Ir anian port of Chahbahar. About Chahbahar Port: Afghanistan and Iran inked an agreement which will permit Afghanistan to use Ira n s south-eastern Chabahar port for shipments and trade. Why Afghanistan needs to use port of Iran? Afghanistan is a landlocked country thus it needs to use Iran s port for its shipm ents and trade. Strategic location of Chabahar port Chah Bahar is Iran s southernmost city. Iran s closest and best access point to the Indian Ocean. It is the only Iranian port with direct access to ocean. For this reason, Chabahar is the focal point of Iran for development of the east of the country through expansion and enhancement of transit routes among countr ies situated in the northern part of the Indian Ocean and Central Asia. Chabahar is just 72 km west of Pakistans Gwadar Port, being built with Chinese h elp. What is the India s role in this whole gambit? A plan being finalized by India to construct a 900-km railway line that will con nect Chabahar port in Iran, being built with Indian assistance, to the mineral-r ich Hajigak region of Afghanistan. When finished, this line will throw up both geo-political and economic opportuni ties for India. Why the deal b/w Iran and Afghanistan will be a win-win situation for Afghanista n, India, Iran and also for US? Afghanistan: Access to the sea. Decrease in dependence on Pakistan. This will resolve trade related transit issues of Afghan traders and thus promot e trade and commerce. India: Increase in Indian influence in Afghanistan. Increase in strategic presence of India in the region. It will open opportunities for Indian companies to explore Afghanistans mineral wealth, believed to be worth $1-3 trillion, for mutual benefit. It will add to the economic rationale for Indian investment in Chabahar. Once the entire network comprising of road, rail and port is in place, it can be come a launching pad for greater economic and strategic involvement of India in the oil and mineral-rich Central Asia. (Behind the curtains): It is believed that the Chabahar port is being financed by Indian government in order to maintain Iranian and Indian influence in Afghanistan after US forces le ave Afghanistan in 2014. It is also believed that this is a move by India in order to counter Gwadar port of Pakistan. Iran: Business opportunities for Iran as its facilities are used. Chabahar port being built with Indian assistance Iranian influence in Afghanistan increases. US: Relieves the pressure on the US-backed Afghan Government to rely on trade routes via Pakistan, as relations b/w US and Pakistan have seen substantial restrains in recent times. The agreement b/w Iran and Afghanistan will assist Afghan traders including thos e directly working with US contracting companies as they will now be able to use the south-eastern port Iran s only port with direct access to the sea for importi ng and exporting goods.

Relief to US/NATO officials as the shutdown of NATO supplies from Pakistan has i nduced enormous setback in terms of finance to US/NATO. So, except Pakistan which looses business in the process, it is a win-win situat ion for all. But, what India may lose in this ploy? Nevertheless, India s larger collaboration with Iran in Chabahar (and, presumptive ly, in other areas) will more or less surely disturb US, whose support is necess ary if India is to play a greater role in the region. Last Updated: May 4, 2013 Tags: Afghanistan China Fact Box February 2013 India-Afghanistan India-China ia-Pakistan International Pakistan Places in News

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