INP-WealthPk

CAREC – Improving Regional Linkages of Pakistan

February 21, 2022

By Muskan Naveed ISLAMABAD, Feb. 21 (INP-WealthPK): Aside from the China-Pakistan Economic Corridor (CPEC) which dominates the news, the Central Asia Regional Economic Cooperation (CAREC) is another initiative of Pakistan and China along with other nations which essentially has the same goals as the Belt and Road Initiative (BRI). CAREC in Pakistan CAREC currently has eleven members - Afghanistan, Azerbaijan, China, Georgia, Kazakhstan, the Kyrgyz Republic, Mongolia, Pakistan, Tajikistan, Turkmenistan, and Uzbekistan. The eleven members of CAREC have pledged to contribute towards the economic growth and sustainable development of the region through cooperation and with the support of development partners. Asian Development Bank, International Monetary Fund, United Nations Development Fund and the World Bank serve as the development partners of the initiative with ADB the secretariat of the CAREC program. Two of the main routes of CAREC pass through Pakistan. One of the major aims of the initiative is to help landlocked central Asian states overcome the costs and inefficiencies through the provision of a seamless connection with seaports for the transit of goods. Pakistan joined the Central Asian Regional Economic Cooperation initiative back in 2010. The country plays a vital role in the initiative because of its geopolitical importance. Pakistan aims to develop its national road corridors to improve the regional connectivity from Azerbaijan in the west, to China in the east and Kazakhstan in the north. The CAREC Corridor 5 serves as a vital link between the landlocked Central Asian countries and Pakistan’s warm water ports of Gwadar and Karachi. During August, the Asian Development Bank approved a loan of $235 million for the upgradation of the 222 kilometers long Shikarpur-Rajanpur section of National Highway 55 (N55) – which is a part of the Corridor 5. Cooperation with Kazakhstan During November, the 20th Central Asia Regional Economic Cooperation Ministerial Conference was held virtually. It was hosted by the government of Azerbaijan – co-chaired by Azerbaijan’s Minister of Economy and the vice president of ADB. The conference discussed a new perspective for regional cooperation in the wake of the global pandemic. Azerbaijan’s minister of economy outlined the economic dividends the member states can see through digitization. Moreover, the CAREC Digital Strategy 2030 will not be under full effect with Azerbaijan’s full commitment as the 2030 vision is aligned with the national-level goals of the country. Kazakhstan is a key player in CAREC, as the largest in Central Asia and the ninth-largest in the world in terms of territory. The country has also realized the important strategic position of Pakistan and is planning on pursuing greater regional connectivity through the projects of CPEC and CAREC with Pakistan. The arrival of the new Kazakh ambassador in Pakistan is also expected to expediate the efforts of greater regional connectivity. The embassy of Kazakhstan in Pakistan also held its first online meeting of the Joint Working Group on trade and investment along with transportation. The new ambassador, H.E. Kistafin, said that both the countries must explore trade in diverse fields and also urged Kazakh investors to explore opportunities in Pakistan. The embassy also stated Pakistan is now a signatory of Transports Internationaux Routiers (TIR) Convention on Logistics and Transportation, which can decrease the cargo costs between the countries.