Should we stay or should we go? China's dilemma in Pakistan

Of foreigners who fall victim to terrorism in Pakistan, Chinese people are the most represented group.

Consecutive attacks have left China with a Hobson's choice. Either roll back the $62-billion China-Pakistan Economic Corridor (CPEC), one of the key arteries of Beijing’s Belt and Road initiative (BRI), and quit Pakistan, or join Islamabad in its war on Islamists and separatists.

Over the past decade, China has directly invested $25.4 billion in various transport, energy and infrastructure projects related to CPEC in Pakistan. Since 2015, 28 projects worth $18.8 billion have been completed and other projects worth $34 billion are under different phases of planning or execution. It is estimated that Pakistan’s external debt has increased to $100 billion, with more than $30 billion owed to China.

However, terrorism and insurgency have created a security challenge for China's CPEC ambitions in Pakistan.

Such vulnerability is evidenced by an April 19 suicide attack in Karachi that hit five Japanese people likely mistaken for Chinese workers. Fortunately, those targeted were unhurt, though the onslaught killed one Pakistani and injured three others.

In the latest attack on Chinese nationals, on March 26, five Chinese engineers working on the Dasu Dam — part of CPEC — were killed in Pakistan’s northwest. Initial investigations by Pakistani authorities found that the banned Tehreek-e-Taliban Pakistan (TTP) — the Pakistani Taliban — was involved in the assault.

The same extremist group was behind a similar suicide attack in 2021 that killed 13 people, including nine Chinese engineers working on the same dam.

CPEC is one of BRI’s flagship projects and involves the construction of an estimated 3,000 kilometers of highways, railways and energy pipelines connecting Kashgar in western China to Gwadar Port in Pakistan’s southwest. The Chinese-run port looking out onto the Arabian Sea — strategically located at the mouth of the Persian Gulf and near the Strait of Hormuz, along a key shipping lane — is a vital CPEC component.

However, it is located in Balochistan province, where Baloch groups have been engaged in an insurgency against the Pakistani government for the past two decades. Separatist groups, namely the outlawed Balochistan Liberation Army (BLA) and Balochistan Liberation Front (BLF), have carried out several attacks on Pakistani security forces as well as Chinese nationals and interests in the province.

The BLA is fighting against the Pakistani state for a separate and independent Balochistan and sees Beijing as Islamabad’s partner in the exploitation of the province’s resources.

In a video message published on social media in 2022, the BLA asked China to quit Balochistan and halt CPEC development in the province. “The Balochistan Liberation Army guarantees you that CPEC will fail miserably on Baloch land,” was its message directed at Chinese leader Xi Jinping.

Over the past decade, the BLA has targeted Chinese nationals on several occasions. For example, in 2018, it committed a suicide attack on Chinese engineers, injuring three of them, in the Dalbandin area of Balochistan. The same year, the group attacked the Chinese consulate in Karachi.

In 2019, the BLA assaulted Chinese tourists at the five-star Pearl Continental Hotel in Gwadar. Three years later, a BLA militant blew herself up outside the Confucius Institute at the University of Karachi, killing three Chinese teachers. Last year, the BLA attacked a military convoy carrying Chinese engineers in Gwadar. The assault was repelled and the two attackers were killed by security forces.

China has repeatedly asked Pakistan to guarantee its nationals’ security and Beijing’s interests in the country but, despite Islamabad’s attempts, attacks on Chinese people have continued unabated.

There have been calls in China for Beijing to take direct action against militant groups. In 2022, Hu Xijin, the former editor-in-chief of the Global Times, a Chinese Communist Party mouthpiece, tweeted: “The BLA will definitely be more resolutely annihilated. I support Chinese military to launch direct air strikes against this terrorist organization's camp after getting approval of the Pakistani government.”

Islamabad blames India, its arch-rival, for financing the Baloch rebels and extremist outfits targeting Chinese nationals in Pakistan. Chinese experts agree with Pakistan's accusation and connect the attacks to Beijing’s own rivalry with New Delhi.

"Chinese projects in Pakistan such as the CPEC may face more severe security challenges, because geopolitical rivalry is involved,” Liu Zongyi, secretary-general of the Research Center for China-South Asia Cooperation at the Shanghai Institutes for International Studies told the Global Times in 2022. Liu added that, while clear evidence is lacking, “Pakistan's accusation of the BLA being an Indian proxy does not come out of thin air."

Following the killing of nine Chinese engineers in 2021, a Global Times editorial stated that, while the Pakistani government is in change of its internal security, “if the situation deteriorates, China cannot completely leave it up to Pakistan.” It cited the possibility of “China's missiles and special forces” being wielded to “eliminate threats against Chinese in Pakistan,” with Islamabad’s consent.

Is China ready to bear the costs of pursuing its geopolitical and economic goals through CPEC? Realistically speaking, China faces a binary choice — either quit or continue. Beijing has not signaled that it is considering the former option, though security issues have been one of the main reasons for CPEC projects’ slow implementation, together with political instability and a financial crisis in Pakistan.

Last year, CPEC construction hit its first 10-year milestone and entered its second phase, which aims for the establishment of 33 special economic zones. The third and final stage is scheduled for completion in 2030.

Beijing could consider joining Islamabad in its war on extremist and separatist groups such as the BLA to protect its strategic interests in the South Asian country. However, direct strikes by China against terrorist outfits in Pakistan could be seen as a violation of the South Asian country's sovereignty. For example, the Pakistani public reacted with outrage to the United States' drone strikes against militants in Pakistan prior to the withdrawal of U.S. forces from Afghanistan in 2021.

As things stand, a direct, heavy-handed approach would be a bad idea both for Beijing and Islamabad. However, as CPEC’s second phase advances, there is a risk this might change.