What is the Cost of Balochistan’s Independence to Pakistan-China Relationship?
Chongtham Sen Chanu | 21 May 2025
Summary
Since China and Pakistan agreed to start the China-Pakistan Economic Corridor (CPEC) project, foreign direct investment (FDI) from China has been one of the largest investments every year in Pakistan since 2015.
China’s investment in Balochistan is crucial to achieving its broader energy security ambition. Under CPEC, approximately 90% of the investment in Balochistan is concentrated in the Gwadar region to improve the performance of Port Gwadar.
An independent Balochistan will likely damage the mutually beneficial Sino-Pakistani relationship, improving China’s energy security and Pakistan’s military defence..
Critical China-Pakistan Economic Corridor (CPEC) Projects in Balochistan
Balochistan is a focal point for the CPEC project. The Gwadar Port in Balochistan, a flagship project of CPEC, connects China with the Arabian Sea. In the words of a Pakistani official, “Gwadar Port is the torch-bearer of urban and industrial development of the Gwadar district.” The port offers China an alternative energy route to the Malacca Strait, where 80% of China’s oil imports pass through. Balochistan also hosts at least 16 CPEC projects, including Gwadar Free Zone and Gwadar Power Plant. Most investments in Balochistan are largely concentrated in the Gwadar region to increase Gwadar Port’s commercial viability. Pakistan has three main international ports, namely Karachi Port, Qasim Port, and Gwadar Port. According to Pakistan’s Ministry of Finance, Gwadar Port handled only 34,000 tonnes of cargo in the fiscal year 2023-2024 as compared to 64m tonnes of Karachi Port and 34m tonnes of Qasim Port. Gwadar region under CPEC is China’s long-term geopolitical strategy and a gateway to Beijing’s energy security. On the other hand, for Pakistan, the inception of the CPEC has allowed for a steady FDI from China, occupying the status of top investor since 2015.
The Cost of Balochistan’s Independence
An independent Balochistan will stall China’s dream of an alternative energy route, particularly with Baloch separatists’ sentiments towards Chinese projects due to the lack of benefits for the local community. An independent Baloch government could align with India—China and Pakistan’s regional rival—allowing Indian naval bases near Gwadar to counter China’s Indian Ocean ambitions. CPEC is one of the strongest points for Pakistan’s relationship with China. Sino-Pakistani cooperation is based on mutual strategic necessities instead of ideological affinity. For China, a timely completion of the CPEC projects is its immediate concern. Beijing has consistently pressured Pakistan to permit the deployment of Chinese security personnel in Pakistan to protect its workers against terrorist threats. This pressure from China is an implication of how the current Sino-Pakistani partnership could suffer a huge setback if the threats from the terrorist groups (BLA, Tehreek-i-Taliban) continue to delay the CPEC projects.
Without Chinese backing, Islamabad would lose significant financial support and be placed under heavier Western scrutiny over its alleged role in funding insurgency groups. An independent Balochistan will also potentially reduce Pakistan’s FDI net inflows from one of its top investors, considering Pakistan has proved to be incapable of securing Beijing’s strategic interests. In this regard, China would turn to countries like Iran to realise its Indian Ocean ambitions, further isolating Pakistan. Pakistan is currently addressing its immediate economic concerns through International Monetary Fund (IMF) bailouts, so the possible aftermath of an independent Balochistan will severely strain its economy. Therefore, the survival of Sino-Pakistani relationship is highly dependent on the successful suppression of Baloch-based insurgent groups.
Source: State Bank of Pakistan
Forecast
Short-term (Now - 3 months)
The BLA recently declared independence from Pakistan, even though the overall territorial control of Balochistan is still in the hands of the Pakistani authority. However, this declaration will likely increase government military operations in Balochistan which require an amplified budget allocation for the security cost.
The military operations will further strain the government’s relationship with the local community, which in turn, would increase terror attacks. As a result, it is very likely that China will intensify its call for security personnel deployment in Pakistan or further pressure Islamabad to curb terrorist threats against Chinese workers.
Long-term (>1 year)
The BLA has become more organised and frequent in its attacks against the Pakistani authority since Operation Hereof, an ongoing military operation of the BLA since 2024. If this terror trend persists, it is highly likely that Port Gwadar will remain underperforming as usual. As a result, China will likely scale back on its investments and start looking for alternative locations to achieve its energy security aspiration.
