FROM PROMISES TO PARALYSIS: HOW LOCAL POLITICAL PARTIES UNDERMINE THE BENEFITS OF CPEC

Abstract

The China-Pakistan Economic Corridor (CPEC) was introduced in 2015 as the main part of China's Belt and Road Initiative (BRI). CPEC was first hailed as a "game-changer" for Pakistan's economic recovery, but over the past ten years, its expected advantages have dwindled because of deeply ingrained internal political factors. According to this study, local political parties have seriously harmed CPEC capacity for integration through centralizing governance, unequal resource distribution, and hostile provincial-federal relations. This study uses Political Trust Theory to analyze how politicization raises investor risk perceptions, undermines legitimacy, and discourages community collaboration. Balochistan, Khyber Pakhtunkhwa, and Gilgit-Baltistan are among the politically delicate and strategically significant areas that are the focus of this qualitative case study examination. Key findings show that while provincial complaints about being left out of decision-making processes have strengthened center-periphery tensions, partisan competitiveness, policy discontinuities, and disagreements over project routing have hampered implementation. With frequent protests, like the “Haq Do Tehreek”, interfering with port operations and discouraging investment, Gwadar’s growth is a prime example of the disparity between prominent strategic assets and little local socioeconomic rewards. Risks are exacerbated by Balochistani security politicization, and Special Economic Zones (SEZs) performance suffers from political sitting and inadequate intergovernmental coordination. According to the study's findings, CPEC physical infrastructure will continue to fall short of the promised economic transformation in the absence of reforms to improve transparency, equitable resource distribution, and provincial participation. As a result, the long-term developmental impact of the project will be limited by the existing political structures.