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53 Asian Journal of Social Science and Management Technology
Asian Journal of Social Science and Management Technology
ISSN: 2313-7410
Volume 2 Issue 3, May-June, 2020
Available at www.ajssmt.com
----------------------------------------------------------------------------------------------------------------
Iran-Pakistan Relation: Impact on CPEC
Sahibzada Muhammad Usman
Ph.D. in Geopolitics, University of Pisa, Italy.
ABSTRACT : This article introduces the strategic significance of CPEC and Iran-Pakistan relations in the
Baluchistan region, regional security, and armed forces. Because of the lack of trust between Iran and Pakistan,
it is impossible to strengthen ties by expanding economic development and cooperation. The relationship
between Pakistan and Iran has always been a long-standing problem in the historical context of the region, and
because of China's CPEC plan in this region, the resolution of this problem has become particularly important.
Due to separatists, terrorism, and armed control of the region by some powerful countries, the Baluchistan
areas of Iran and Pakistan have been idle. At present, local Chinese and their economic corridors are
promoting economic development in the region and realizing China's trade routes in accordance with their
pearl plan. In the course of the research, several variables will be used to explain the factors that affect
Pakistan-Iran relations.
Keywords : Chabahar, Gwadar, Iran-Pakistan, China, America.
-------------------------------------------------------------------------------------------------------------------------------------------------
1. INTRODUCTION
Pakistan's freedom in 1947, Iran was the first nation to support Pakistan's independence and has always been
an important political support for Pakistan. In May 1948, Iran established diplomatic relations with Pakistan;
Pakistani leader Liaqat Ali Khan (1949) visited Iran; in 1950, the Iranian leader visited Pakistan and signed the
"Reconciliation Agreement." Regardless of the split between Shiites and Sunnis, Islamic identity has become an
significant element in Pakistan and Iran relations, particularly after the Iranian rebellion in 1979. With the end
of the Islamic turmoil and the close relations between America and Iran, the stability of Iran-Pakistan relations
began in the 1970s when pressure on Afghanistan became stronger and its contribution to anti-Soviet,
particularly after the left-wing Saur chaos in 1978 . After the outbreak of the Cold War, a whole new situation
emerged in the Gulf region led by the United States, which provided conditions for another move between
both nations. Emerging Pakistan and Iran relations, particularly the thorny issues including nuclear
development, have developed as the core of strengthening bilateral relations. The establishment of relations
between India and Iran and increasing role of the United States in Afghanistan and Pakistan may have a
negative impact on Pakistan and Iran relations in the coming years.
The economic and political conditions of Iran and Pakistan are under tremendous pressure. Iran has been in a
struggle between liberals / moderates and protectionists for quite a long time. In addition, it is under pressure
from Europe and the United States in the development of nuclear weapons. Pakistan has always faced
problems of race, division and religion. To some extent, Pakistan is under pressure on Iran's nuclear
development deal. The geopolitics and internal vulnerabilities between the two countries will affect the
development of associations between the two nations.
54 Asian Journal of Social Science and Management Technology
2. IRAN AND PAKISTAN ECONOMIC RELATIONS
The CPEC (China-Pakistan Economic Corridor) is rapidly becoming the cause of national cooperation, economic
development, and social stability and play a vital role in improving the economic situation of the poor areas of
Pakistan and promoting the provincial transportation network. The benefits of the CPEC will benefit China and
Pakistan as well as benefit the entire region, especially advance the relations between Pakistan and Iran,
because the local growth of CPEC can support Pakistan consolidate economic associations with Iran. Although
Iran and Pakistan have always maintained friendly relations, so far, the trade volume between the two
countries very low. In 2014, the trade volume was the US $ 229 million (Salim Ahmed, February 21, 2016). At
this stage, since the Iranian Chabahar port and the Gwadar port of Pakistan have very important geopolitical
and geostrategic significance, China-Pakistan Economic Corridor will promote the economic growth of Iran and
Pakistan. Both ports have direct entrance to the Persian Gulf. If the China-Pakistan Economic Corridor is linked
to Chabahar, it will support economic networks and cooperation between Iran and Pakistan.
After reaching a fruitful atomic energy agreement with P5 + 1 in July 2015, and after the United States and the
international community lifted all sanctions, Iran has reintegrated into global dynamic economic development.
At present, this is an opportunity for Iran to open the door to economic relations with the world, especially the
nations of Central Asia. Pakistan also hopes to profit from this opportunity by expanding bilateral cooperation
with Iran. Islamabad had previously been unwilling to cooperate with Iran on large-scale projects, but after the
removal of all sanctions on September 2, 2015, Pakistan and Iran decided to work together. In August 2015,
during the Combined Working Group on Trade and the Technical Committee on Trade, both nations discussed
issues linked to investment and trade and outlined a five-year strategic arrangement for mutually developing
trade. They agreed to apply the reciprocal preferential trade agreement (PTA) and change to an FTA (free
trade agreement) in the next few years. In 2015, the trade volume between Iran and Pakistan was $ 893
million, which may increase in the future (Ahmed Rashid Malik, November 11, 2015). Hassan Rouhani's
(President of Iran) visit to Pakistan in 2016 opened up another path for strengthening the economic
partnership. One of the basic purposes of the president's visit is the building of a gas pipeline. During the
meeting between the presidents of the two countries, they agreed to develop each other mainly in the fields
of energy, economy, and trade. The leaders of the two countries also held a one-to-one meeting and
conducted various dialogues on bilateral issues, as well as regional and global matters of mutual concern. After
the discussion, the two signed six memorandums of understanding and five-year trade cooperation plans.
3. CHINA-PAKISTAN ECONOMIC CORRIDOR AND IRAN (YASMEEN AFTAB ALI, SEPTEMBER 7,
2015)
In September, Iran agreed to consider supporting the suggested CPEC, with a focus on improving and
upgrading roads and railways and expanding the scope of product transit. Pakistan made an offer. Some
experts re-examined the basic facts of Iran and the importance of making CPEC profitable. The dialogue
between the two countries took place recently, and this proposal was made in the foreseeable future of the
international community in lifting sanctions against Iran. In 2014, Pakistan vigorously organized the import of
natural gas from Iran. The United States expressed great disappointment with Pakistan's urgent needs. The
proposed target focuses on the conversion of petroleum gas to liquefied natural gas (LNG) and the
introduction of gas from Iran to Pakistan using the facilities of Oman's LNG terminal. However, the United
States has issued a similar warning, hoping that India will stop any cooperation with Iran, but this has not
stopped the Indians from continuing what they call India's national interest. Nitin Gadkari, Minister of
Highways, Shipping, and Road Transport reported before the summit between the two countries that India
would invest in Iran, especially in port, railway, and highway project India's participation in the Chabahar
Conference can help strengthen bilateral relations. Soon after, six countries and Iran reached a valuable
agreement under the impetus of the United States. Tehran has more than ten years of atomic power, which is
the end result of lifting sanctions related to oil and money worldwide.
Cooperation between countries is changing rapidly. Pakistan needs to be fully aware of these changes and plan
accordingly. In 2014, Pakistan and Russia signed the "Military Cooperation Agreement." The friendly relations
55 Asian Journal of Social Science and Management Technology
between Pakistan and China are recognized. India's turn to the United States and Israel has not been neglected
by Russia, which has begun to seek different countries in the region to establish cooperation. But this does not
mean that we have to quit our previous cooperation. Russia is armed to support Pakistan, which may be seen
as an arrangement to break away from a close alliance with India and establish a trade association with an
opponent. India has changed its strategy against Iran for some time and has reached a transportation
agreement with Iran to increase the number of flights between both nations and allow one other airline to
travel to other destinations. A unique maritime cooperation plan has been introduced, and Iran officially
connected with the Indian Navy. After a period of processing under the leadership of the United Progressive
Alliance government, the Modi regime chose to invest $ 85.21 million to build the Iranian Chabahar port,
allowing India to avoid Pakistan and open up a path for inland Afghanistan. The Chabahar Port is located 72
kilometers west of Pakistani Gwadar Port and has great strategic and economic importance to India.
4. GWADAR AND CHABAHAR AGREEMENTS
President of Iran Rouhani and Prime Minister of India Modi signed the Chabahar Agreement, which allows
India to build Chabahar Port in the Baluchistan Province of Iran as an important economic corridor connecting
India with the Central Asian and Afghan markets. This transaction is regarded as an important response of
India to the CPEC. According to the agreement, China will invest approximately US $ 46 billion to connect
western China through land railways, pipelines, and roads to Gwadar Port. The Indochina competition
underscores Baluchistan's geopolitical importance as the center of a new movement in which Asia, India,
China, and the United States participate. Iranian Chabahar port is India's reply to Chinese investment in the
Gwadar port of Pakistan. The two ports are a portion of Baluchistan province and are 70 kilometers apart from
each other.
5. CHABAHAR TRANSACTION AND ITS REGIONAL IMPACT
The Chabahar port deal between Iran and India is part of 12 settlement agreements marked by President
Rouhani of Iran and Prime Minister Modi of India at a summit. Afghan President Ashraf Ghani also signed a
trade agreement with Rouhani and Modi to assist in the transportation of products between these countries
and allow India to use Chabahar port to enter Afghanistan. According to the agreement, India will invest the
US $ 500 million for the development and setup of the Chabahar port in Iran and Luchistan province, which will
become India's entrance to Central Asia and Afghanistan. India will launch some other major venture
investments worth US $ 20 billion, including the LNG plant and the natural gas sector of the Chabahar trade
zone (June 13, 2016, R. Gupta). The Chabahar deal is seen as a game-changer for Afghanistan, India, and Iran,
as well as China, Pakistan, Central Asia, and the Arab Gulf countries. It has had an economic, political, and
diplomatic impact, benefiting Afghanistan, India, and Iran from competitors.
6. ROLE OF IRAN
After the atomic arrangements and the lifting of Western sanctions, the transaction provided Iran with a wide
range of trade and economic development opportunities. To strengthen the implementation of the agreement
in the meeting, Indian Prime Minister Modi pay back the US $ 6.4 billion, which owned by the Indian refinery
and promised to transfer the remaining quickly (Mulani Nikola, June 11, 2016 mention). This arrangement
enables Iran to expand and secure its market share of energy projects in India at the outlay of Saudi Arabia.
Moreover, it attracted a lot of investment needed to improve Chabahar and its framework.
For India, Iran has allowed the provision of facilities and land to Afghanistan, the nations of Central Asia, and
China in order to obtain the benefits of Chabahar. Iran constructed a 600-kilometer highway that links
Chabahar to Zahedan, 240 kilometers from Malik on the border between Afghanistan and Iran. In addition,
construction work is underway to connect Malik and India's Zaranj-Delaram highway in the Nimrods region
(Afghanistan). Iran also began construction of a railway connecting Chabahar and Zahedan, which will be
connected to the Iranian railway network, CIS countries, and Central Asia. Third, this arrangement is through
tariffs and duties imposed on goods passing through Chabahar; and the Iranian railways use roads and
pipelines connecting Chabahar to the nations of Central Asia and Afghanistan Sources of income from
56 Asian Journal of Social Science and Management Technology
transportation and transit fees. Iran imposes high tariffs on imports from the Gulf and India, as well as exports
from the nations of Central Asia and Afghanistan. Fourth, Iran considers Sabahal as another option in the port
of Abbas located in the Arabian Gulf. Any restrictions on the Hormuz will disrupt Iran's transportation and
trade and render the port of Abbas useless. Chabahar is a deep-water port in Iran that can enter the Indian
Ocean. From a geopolitical perspective, Iran also views the Chabahar Agreement as the key to increasing
political impact in Afghanistan, Southwest, and Central Asia; to consolidate its situation in the Gulf region. The
expanded political, economic, investment and trade relations between India and Iran may promote strategic
cooperation and prepare for more foundational maritime cooperation in the Arabian Sea and the Indian Ocean
(Bearak, M. & Murphy, B. 2016 January 5 24).
7. ROLE OF PAKISTAN
Chabahar port, together with the India-Iran-Afghanistan trilateral relationship, will undoubtedly affect Pakistan
and Iran relations. It poses a direct economic challenge to Gwadar, located 70 kilometers east of Chabahar
port. Gwadar port is also a deep seaport, located on important sea lines and land roads that connect
Afghanistan and China to the Middle East and the Indian Ocean. Iran used Chabahar to challenge Pakistan,
preparing to connect to Afghanistan and Central Asia through railways, land routes and pipelines, thereby
increasing the possibility of expanding trade with these countries and obtaining large amounts of energy
assets. Similarly, the rapid entry into Chabahar freed Afghanistan from using Pakistan's Karachi and Gwadar
ports. As a result, Pakistan lost the source of revenue for customs clearance and customs fees charged for
using these ports. Politically, Iran has greater influence in Afghanistan and the Middle East, and Pakistan's
common goal is to confront India. Because of its dependence on the ports of Pakistan, Afghanistan needs to be
consistent with the Pakistani army's Afghan approach and strategy to some extent.
Chabahar's entry into Afghanistan means that Afghanistan can independently develop a strategy without
worrying about Pakistan. Similarly, Tehran believes that the Gwadar-Chabahar competition is a way of
cooperating with Saudi-Pakistan, and its ultimate goal is to reinforce Iran's influence in the Arabian region. Due
to India's presence on Chabahar's western border and the losing its dominance in Afghanistan, Pakistan was
unable to transport its natural assets from its eastern border, thus giving Iran the convenience of its operations
in the Middle East. Pakistan is worried about Indian existence in Chabahar area. The Pakistani military suspects
that India can use the port to monitor Pakistan and collect information about its maritime navigation in Oman
and the Arabian Sea. Prime Minister Modi's statement further supports this view: "We have decided to
strengthen cooperation between our security and defense organizations on local and maritime security"
(Hughes, Lindsay. April 26, 2016).
8. Gwadar, Chabahar, and the Global Powers
The geopolitical influence of Gwadar and Chabahar harbors is huge for the competition between Chinese
Americans and Indian Chinese in the Indian Ocean and Asia. Each of the three extraordinary forces
demonstrates the interests of Baluchistan's important ports and geopolitical regions. It gave impetus to the
development of the Baluch nation and their independent activities. Baluchistan lost his freedom in the 19th-
century Anglo-Russian competition, and historians called it a "great game." Baluchistan had a supremacy
during British rule and became a base to avoid Russians marching towards India and the waters of the Arabian
Gulf and Indian Ocean. Baluchistan's independence is a new legacy of the "Great Power Game," marking the
good intentions of Baluchi for the British country, especially against Iran and Pakistan. At present, India, China,
and the United States are playing a new major power game in the Indian Ocean and Asia. The characteristics of
the new game are the same as before: fighting for resources, projecting power, pursuing benefits, and
expanding the scope of influence. In such a scenario, the important ports of Chabahar and Gwadar are
becoming the main center of the game for similar reasons to the attention of the new great powers in the 19th
century: its Geostrategic significance. It stated that the Baluchistan province stands out among the most
critical regions on the planet.
57 Asian Journal of Social Science and Management Technology
9. Role of India
India's plan in Chabahar is to catch up with its rival China, maintain its energy supply, bypass its opponent, and
expand its influence in the nations of Central Asia and Afghanistan. Symbolically, this step is a testament to
India's role as an important participant and successor to Britain on the subcontinent. Chabahar will intend to
give India the power to challenge China's power in Gwadar. The CPEC is a $ 46 billion mission that connects
western province of China through pipelines, roads, and railways to Gwadar, allowing Beijing to enter the
Indian Ocean directly. India believes that the development of Chinese bases and spies in the port of Gwadar
poses a danger to the Indian Navy in the Hormuz, Oman, and the Arabian Sea. In addition, China and Pakistan
also regard CPEC as a key move against India in West Asia. Chabahar's entry is India's policy to stop China's
movements in West Asia, the Hormuz, and the Arabian Sea. Moreover, entering Chabahar into Afghanistan has
strengthened the cooperation between Afghanistan and India against Pakistan, and has allowed India to enter
Central Asia.
Similarly, India's goal is to turn Chabahar into an important economic, industrial, and trade hub in the Middle
East, and to enter markets in Central Asia and Afghanistan. The Chabahar port will let India guarantee energy
transportation from the nations of Central Asia, the Middle East, and Iran, and develop India's commercial and
trade market share. India is the second-largest country in oil imports from Iran, second only to China.
Chabahar is committed to establishing the energy relationship between India and Iran and allowing India to
obtain energy assets in the nations of Central Asia through Afghanistan. As Asia's third-fastest and largest
growing economy, energy security is crucial in India's plan to move into Chabahar and connect its ports to
Central Asia via pipelines. Chabahar's entry provides new impetus for energy and technology of India to the
nations of Central Asia and to respond to fast-growing China in the region, and makes the Turkmenistan-
Afghanistan-Pakistan-India pipeline from Iran and Oman to Major natural gas pipeline options in the Indian
Ocean. The foreign ministers of these three countries reviewed this plan for the first time in February 2014,
but did not proceed because of sanctions imposed on Iran by the West and America. With the lifting of
sanctions, this plan proved reasonable, especially for India. Because India has serious doubts about the
security issues through Pakistan in the Turkmenistan-Afghanistan-Pakistan-India pipeline.
In this way, India will expedite its plan to connect to Chabahar's Central Asia region by pipeline, which can be
connected to the Oman-Iran-India submarine pipeline. In view of this, the President of Turkmenistan Berdi
Mohamedov and the Prime Minister of India Modi held a meeting in mid-July 2015 to agree on seven
arrangements for natural gas, petrochemicals and national defense. The future direction of international
development shows that Turkmenistan backings India's accession to the Ashgabat deals on transit and trade
issues, including Iran, Uzbekistan, Turkmenistan, Oman, and Kazakhstan, to build this pipeline (Hughes,
Lindsay, 2016 April 26).
10. Role of China
The competition between Chabahar and Gwadar is actually a competition between India and China for Asian
hegemony. Therefore, competition in the Indian Ocean, Central Asia, and Afghanistan; China-Pakistan
partnership and Pakistan support; India-China border conflict; and demand for natural assets make the
strategic significance of these two ports particularly important. China's plan is to develop Gwadar into an
important deep-sea port with an aircraft terminal and commercial, industrial, and maritime facilities. This plan
has lasted for more than a decade. The next stage to link the port to western areas of China through pipelines,
railways and highway systems, which was planned in the CPEC with a scale of 46 billion US dollars, although it
did not make an authoritative response. China believes that the port of Chabahar Agreement is a direct
encounter to CPEC and China's offshore investment in the Gwadar port. Gwadar is a key benefit of China's
huge investment in CPEC. It will provide China with an important foothold in the Indian Ocean and successfully
make China a country under control of the two seas.
58 Asian Journal of Social Science and Management Technology
Once the plan is completed, it will be used for military and civilian installations, including sea bases for Chinese
submarines and warships. In addition, it will serve as an observation point to inspect Indian and US naval
operations in the Indian Ocean and the Arabian Sea. Considering the difference between it and the Hormuz,
Gwadar can support Chinese maritime forces to control the way to India or the United States. Soon, Gwadar's
further strengthen the opposition between Pakistan and China against India.
Gwadar's economic advantages over Pakistan and China are equally huge. Gwadar has developed into a unique
business center, especially the export of Chinese goods to Africa, the Middle East and Europe, as well as the
import of products and energy. Pakistan and China mostly import its oil from the Middle East, which is very
close to Gwadar. Gwadar Port is expected to become an important channel for transporting energy through
the pipeline in western areas of China, thereby guaranteeing energy security. China's activities and plans in
Gwadar panic the United States and India. A report released by the Indian Defense Research Institute in Delhi
worried about China's presence in the port of Gwadar. It said that Gwadar, so close to the Hormuz, would
authorize Pakistan to control the energy route. The statement states that Gwadar will enable China to inspect
the Indian and US naval movements in the Arabian Gulf and the Arabian Sea, and also any future naval
cooperation between the United States and India (Rakisits, Claude, 2015).
Just like Delhi's strategy in Chabahar port, China's plan in Gwadar port also faces the Baluch rebellion in
Pakistan's Baluchistan region. But China is aware of this, and the pipeline construction from Gwadar into China
and Central Asia must wait for the political stability of Pakistan and Afghanistan (Jaffrelot, Christophe. January
7, 2011).
11. Role of the United States
The United States shares India's concerns about China's presence and conduct of exercises on the port of
Gwadar and the dangers it may pose to the transportation lines of the Strait of Hormuz and the Arabian Sea.
Therefore, the United States regards Beijing's activities in Gwadar as a long-period risk. A political leader said:
"Actually, Gwadar is important: not today, but it will prove China's goals for the next few years (unclassified
cases by the US State Department)." The most important question for the United States is whether China can
The region gains strategy, potential and economic advantage. The observations of the United States reflect
that in a long period of time, China will become a superpower with a strong maritime advantage. The US also
encourages Chabahar to deal with some dissatisfaction with Delhiā€™s investment in Iran port. As the main
counterbalance against China, India is Asia's massive business sector and the most important country on the
ballot system in the world. It is regarded by the United States as a strategic partner against China in Asia.
Pakistan's cooperation with China and its instability in Afghanistan are another focus, which has pushed US
policy toward Delhi. In this particular case, the port of Chabahar is also useful to the United States because it
can balance China's $ 46 billion Gwadar Corridor and open up another exchange route for Afghanistan.
Afghanistan's financial and political strength is critical to the United States' importance.
Nisha Desai Biswal (Assistant Secretary of State) said in the US Senate: "In order for India to increase the
economic growth of Afghanistan, it needs a national border. India is expanding Contact and find the path or
way of this development "(Chowdari, Utara. May 26, 2016).
12. Opportunity for Iran and Pakistan (CPEC)
Overall, Iran and Pakistan's relationship have improved significantly. The two nations must resolve their
differences on Afghanistan. Pakistan helped Iran solve the problem with the Afghani Taliban, and both nations
have a common position on the Afghanistan issue. Pakistan's territorial position is driven by India, and Prime
Minister Narendra Modi expressed in some events arrangements for the isolation and siege of Pakistan on a
local and global scale. Recently, India's influence in Afghanistan has expanded beyond Iran (Uttara Chowdhury,
May 26, 2016).
A survey conducted in 2013 by the Pakistan Institute of Peace, Pakistan's religions, and political parties insisted
that the relationship between Pakistan and Iran should not be controlled by the United States but should be
based on the country of Pakistan's interest. The friendly relations between Iran and Pakistan not only promote
cooperation with Iran, however benefit economic, security, and religious harmony. The International
59 Asian Journal of Social Science and Management Technology
Monetary Fund (IMF) report in 2013 stated that although Pakistan is Iran's 11th largest business partner, the
potential for business between the two nations may be low, despite its geographic location and the foundation
that the Economic Cooperation Organization can provide (ECO) framework. Much of the business between the
two nations is done by third-country channels, and other illegal economic transactions. This is mainly due to
the mandatory sanctions imposed by the West countries on Iran and the fear of sanctions on transactions with
Iran.
Most importantly, both Iran and Pakistan view China as a confrontation against American hegemony. Iran's
consideration in CPEC will help Pakistan. After the current sanctions are lifted, Iran re-enters global
development, which is good for Pakistan. Economic and trade dealers from whole world rushed to Iran to
encourage cooperation. Experts expect Iran's luck to improve, and the dynamics of the market of oil will
change.
Iran's revival is a good thing for Pakistan, particularly regarding the long-neglected gas pipeline plan. Before
sanctions were imposed on Iran globally, the business volume between the two countries was $ 1.6 billion per
year. After the sanctions, Pakistan and Iran's bilateral business decreased to 300 million US dollars. Since the
Western countries lifted sanctions on Iran due to atomic energy arrangements in 2015, Pakistan-Iran
interaction has gradually increased. That being said, the energy and trade participation between Pakistan and
Iran can be expanded by restoring the Iran-Pakistan natural gas pipeline and can meet Pakistan's 25% energy
demand. The cost of the Iran-Pakistan natural gas pipeline is as high as the US $ 7.5 billion; in Pakistan, it is
about the US $ 1.25 billion. The plan will provide 750 mc ft of fuel per day, and Iranian natural gas may
generate 5000MW of electricity. The natural gas pipeline can become an important portion of the CPEC plan;
analyst Michael Kugelman said that Gwadar is good for Iran because China will provide a fund to the Pakistan
side of the pipeline. In addition, China's large investment in Pakistan may just be a sign of the expansion of
China's infrastructure investment.
13. Conclusion
The Soviet-Afghan war and Iran's Islamic turmoil put Pakistan and Iran in different religious ideologies and
territorial positions. Since 2001, the both nations have worked out ways to keep usual mutual relations,
despite the deteriorating situation. For example, unsafe borders and comparative relations with the United
States, Afghanistan, India, and Saudi Arabia. After showing its major tendency to Saudi Arabia and its position
in the Syrian clash, the current Pakistani administration is working to adjust its relations with Saudi Arabia and
Iran. In addition to the Saudi issue, global sanctions against Iran continue to put pressure on the trade and
economic exchanges between the two countries. Iran believes that the Saudi Arabia and America are obstacles
to the completion of Iran and Pakistan gas pipeline project. Similarly, Iran is also concerned about Iranian
personnel working in Baluchistan, Pakistan.
As China occupies a greater interest in CPEC and is promoted from its economic and friendly relations with
Iran, it is not surprising that Iran supports CPEC. Chabahar's India-Iran plan is seen as a winning step for
Afghanistan, Iran, and India. However, its completion faces many difficulties. The main obstacle is the militant
forces in Baluchistan, Iran. The second test is the uncertainty of Afghanistan, the partner of the Chabahar
agreement. The port of Chabahar could free Afghanistan from its dependence on Karachi, and Gwadar's
Taliban threatened the government to disrupt the plan. Third, if Iran violates its commitments under the
atomic energy agreement signed a year ago, Western countries and the United States are likely to tighten
sanctions. This situation will change India's contribution to the venture. Fourth, the growing tension between
Saudi Arabia and Iran, and any Arab-Iranian clash in the Arabian Gulf will undoubtedly have a negative impact
on the project.
60 Asian Journal of Social Science and Management Technology
14. References
1. Ahmed Rashid Malik (November 11, 2015), ā€œCPEC and the Regionā€. Pakistan Today.
2. Bearak, M. & Murphy, B. (May 24, 2016), To Sidestep Pakistan, India Embraces an Iranian Port. Washington
Post. Retrieved from https://goo.gl/Ae5BLL.
3. Choudhury, Uttara. (May 26, 2016). US Backs India-Iran Chabahar Port Deal as It Outflanks China-Pakistan
Gwadar Project. First Post. Retrieved from: https://goo.gl/p6wCbw.
4. Gulati, Monish. (June 11, 2016). India-Iran Agreement on Chabahar is a Strategic Opportunity - Analysis. Eurasia
Review. Retrieved from https://goo.gl/k50K0X.
5. Gupta, R. (June 13, 2016). Iran, India, and Chabahar: Recalling the Broader Context. Institute of Peace and
Conflict Studies, 5060. Retrieved from http://www.ipcs.org/article/india/spotlight-west-asia-iran-india-and-
chabahar-recalling- the-broader-5060.html
6. Hughes, Lindsay. (April 26, 2016). Bypassing Pakistan: Afghanistan, India, Iran, and Chabahar. Future Directions
International. Retrieved from http://www.futuredirections.org.au/publication/bypassing-pakistan-afghanistan-
india-iran-chabahar/
7. Jaffrelot, Christophe. (Jan. 7, 2011). A Tale of Two Ports: Gwadar and Chabahar Display Chinese- Indian Rivalry
in the Arabian Sea. YaleGlobal Online. Retrieved from http://yaleglobal.yale.edu/content/tale-two-ports
8. Salim Ahmed (February 21, 2016), ā€œCall for Promoting-Pakistan-Iran Bilateral Trade Relationsā€. Pak Observer.
9. Rakisits, Claude. (2015). A Path to the Sea: Chinaā€™s Pakistan Plan. World Affairs. Retrieved from:
http://www.worldaffairsjournal.org/article/path-sea-china%E2%80%99s-pakistan-plan
10. Yasmeen Aftab Ali (September 7, 2015), ā€œIran and CPECā€. Pakistan Today.
11. UNCLASSIFIED U.S. Department of State Case No. F-2014-20439 Doc No. C05785443. Retrieved from:
https://wikileaks.org/clinton-emails/emailid/6383Sent.
INFO:-
Corresponding Author: Sahibzada Muhammad Usman, Ph.D. in Geopolitics, University of Pisa, Italy.
How to cite this article: Sahibzada Muhammad Usman, Iran-Pakistan Relation: Impact on CPEC, Asian.
Jour. Social. Scie. Mgmt. Tech. 2(3): 53-60, 2020.

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Iran-Pakistan Relation: Impact on CPEC

  • 1. 53 Asian Journal of Social Science and Management Technology Asian Journal of Social Science and Management Technology ISSN: 2313-7410 Volume 2 Issue 3, May-June, 2020 Available at www.ajssmt.com ---------------------------------------------------------------------------------------------------------------- Iran-Pakistan Relation: Impact on CPEC Sahibzada Muhammad Usman Ph.D. in Geopolitics, University of Pisa, Italy. ABSTRACT : This article introduces the strategic significance of CPEC and Iran-Pakistan relations in the Baluchistan region, regional security, and armed forces. Because of the lack of trust between Iran and Pakistan, it is impossible to strengthen ties by expanding economic development and cooperation. The relationship between Pakistan and Iran has always been a long-standing problem in the historical context of the region, and because of China's CPEC plan in this region, the resolution of this problem has become particularly important. Due to separatists, terrorism, and armed control of the region by some powerful countries, the Baluchistan areas of Iran and Pakistan have been idle. At present, local Chinese and their economic corridors are promoting economic development in the region and realizing China's trade routes in accordance with their pearl plan. In the course of the research, several variables will be used to explain the factors that affect Pakistan-Iran relations. Keywords : Chabahar, Gwadar, Iran-Pakistan, China, America. ------------------------------------------------------------------------------------------------------------------------------------------------- 1. INTRODUCTION Pakistan's freedom in 1947, Iran was the first nation to support Pakistan's independence and has always been an important political support for Pakistan. In May 1948, Iran established diplomatic relations with Pakistan; Pakistani leader Liaqat Ali Khan (1949) visited Iran; in 1950, the Iranian leader visited Pakistan and signed the "Reconciliation Agreement." Regardless of the split between Shiites and Sunnis, Islamic identity has become an significant element in Pakistan and Iran relations, particularly after the Iranian rebellion in 1979. With the end of the Islamic turmoil and the close relations between America and Iran, the stability of Iran-Pakistan relations began in the 1970s when pressure on Afghanistan became stronger and its contribution to anti-Soviet, particularly after the left-wing Saur chaos in 1978 . After the outbreak of the Cold War, a whole new situation emerged in the Gulf region led by the United States, which provided conditions for another move between both nations. Emerging Pakistan and Iran relations, particularly the thorny issues including nuclear development, have developed as the core of strengthening bilateral relations. The establishment of relations between India and Iran and increasing role of the United States in Afghanistan and Pakistan may have a negative impact on Pakistan and Iran relations in the coming years. The economic and political conditions of Iran and Pakistan are under tremendous pressure. Iran has been in a struggle between liberals / moderates and protectionists for quite a long time. In addition, it is under pressure from Europe and the United States in the development of nuclear weapons. Pakistan has always faced problems of race, division and religion. To some extent, Pakistan is under pressure on Iran's nuclear development deal. The geopolitics and internal vulnerabilities between the two countries will affect the development of associations between the two nations.
  • 2. 54 Asian Journal of Social Science and Management Technology 2. IRAN AND PAKISTAN ECONOMIC RELATIONS The CPEC (China-Pakistan Economic Corridor) is rapidly becoming the cause of national cooperation, economic development, and social stability and play a vital role in improving the economic situation of the poor areas of Pakistan and promoting the provincial transportation network. The benefits of the CPEC will benefit China and Pakistan as well as benefit the entire region, especially advance the relations between Pakistan and Iran, because the local growth of CPEC can support Pakistan consolidate economic associations with Iran. Although Iran and Pakistan have always maintained friendly relations, so far, the trade volume between the two countries very low. In 2014, the trade volume was the US $ 229 million (Salim Ahmed, February 21, 2016). At this stage, since the Iranian Chabahar port and the Gwadar port of Pakistan have very important geopolitical and geostrategic significance, China-Pakistan Economic Corridor will promote the economic growth of Iran and Pakistan. Both ports have direct entrance to the Persian Gulf. If the China-Pakistan Economic Corridor is linked to Chabahar, it will support economic networks and cooperation between Iran and Pakistan. After reaching a fruitful atomic energy agreement with P5 + 1 in July 2015, and after the United States and the international community lifted all sanctions, Iran has reintegrated into global dynamic economic development. At present, this is an opportunity for Iran to open the door to economic relations with the world, especially the nations of Central Asia. Pakistan also hopes to profit from this opportunity by expanding bilateral cooperation with Iran. Islamabad had previously been unwilling to cooperate with Iran on large-scale projects, but after the removal of all sanctions on September 2, 2015, Pakistan and Iran decided to work together. In August 2015, during the Combined Working Group on Trade and the Technical Committee on Trade, both nations discussed issues linked to investment and trade and outlined a five-year strategic arrangement for mutually developing trade. They agreed to apply the reciprocal preferential trade agreement (PTA) and change to an FTA (free trade agreement) in the next few years. In 2015, the trade volume between Iran and Pakistan was $ 893 million, which may increase in the future (Ahmed Rashid Malik, November 11, 2015). Hassan Rouhani's (President of Iran) visit to Pakistan in 2016 opened up another path for strengthening the economic partnership. One of the basic purposes of the president's visit is the building of a gas pipeline. During the meeting between the presidents of the two countries, they agreed to develop each other mainly in the fields of energy, economy, and trade. The leaders of the two countries also held a one-to-one meeting and conducted various dialogues on bilateral issues, as well as regional and global matters of mutual concern. After the discussion, the two signed six memorandums of understanding and five-year trade cooperation plans. 3. CHINA-PAKISTAN ECONOMIC CORRIDOR AND IRAN (YASMEEN AFTAB ALI, SEPTEMBER 7, 2015) In September, Iran agreed to consider supporting the suggested CPEC, with a focus on improving and upgrading roads and railways and expanding the scope of product transit. Pakistan made an offer. Some experts re-examined the basic facts of Iran and the importance of making CPEC profitable. The dialogue between the two countries took place recently, and this proposal was made in the foreseeable future of the international community in lifting sanctions against Iran. In 2014, Pakistan vigorously organized the import of natural gas from Iran. The United States expressed great disappointment with Pakistan's urgent needs. The proposed target focuses on the conversion of petroleum gas to liquefied natural gas (LNG) and the introduction of gas from Iran to Pakistan using the facilities of Oman's LNG terminal. However, the United States has issued a similar warning, hoping that India will stop any cooperation with Iran, but this has not stopped the Indians from continuing what they call India's national interest. Nitin Gadkari, Minister of Highways, Shipping, and Road Transport reported before the summit between the two countries that India would invest in Iran, especially in port, railway, and highway project India's participation in the Chabahar Conference can help strengthen bilateral relations. Soon after, six countries and Iran reached a valuable agreement under the impetus of the United States. Tehran has more than ten years of atomic power, which is the end result of lifting sanctions related to oil and money worldwide. Cooperation between countries is changing rapidly. Pakistan needs to be fully aware of these changes and plan accordingly. In 2014, Pakistan and Russia signed the "Military Cooperation Agreement." The friendly relations
  • 3. 55 Asian Journal of Social Science and Management Technology between Pakistan and China are recognized. India's turn to the United States and Israel has not been neglected by Russia, which has begun to seek different countries in the region to establish cooperation. But this does not mean that we have to quit our previous cooperation. Russia is armed to support Pakistan, which may be seen as an arrangement to break away from a close alliance with India and establish a trade association with an opponent. India has changed its strategy against Iran for some time and has reached a transportation agreement with Iran to increase the number of flights between both nations and allow one other airline to travel to other destinations. A unique maritime cooperation plan has been introduced, and Iran officially connected with the Indian Navy. After a period of processing under the leadership of the United Progressive Alliance government, the Modi regime chose to invest $ 85.21 million to build the Iranian Chabahar port, allowing India to avoid Pakistan and open up a path for inland Afghanistan. The Chabahar Port is located 72 kilometers west of Pakistani Gwadar Port and has great strategic and economic importance to India. 4. GWADAR AND CHABAHAR AGREEMENTS President of Iran Rouhani and Prime Minister of India Modi signed the Chabahar Agreement, which allows India to build Chabahar Port in the Baluchistan Province of Iran as an important economic corridor connecting India with the Central Asian and Afghan markets. This transaction is regarded as an important response of India to the CPEC. According to the agreement, China will invest approximately US $ 46 billion to connect western China through land railways, pipelines, and roads to Gwadar Port. The Indochina competition underscores Baluchistan's geopolitical importance as the center of a new movement in which Asia, India, China, and the United States participate. Iranian Chabahar port is India's reply to Chinese investment in the Gwadar port of Pakistan. The two ports are a portion of Baluchistan province and are 70 kilometers apart from each other. 5. CHABAHAR TRANSACTION AND ITS REGIONAL IMPACT The Chabahar port deal between Iran and India is part of 12 settlement agreements marked by President Rouhani of Iran and Prime Minister Modi of India at a summit. Afghan President Ashraf Ghani also signed a trade agreement with Rouhani and Modi to assist in the transportation of products between these countries and allow India to use Chabahar port to enter Afghanistan. According to the agreement, India will invest the US $ 500 million for the development and setup of the Chabahar port in Iran and Luchistan province, which will become India's entrance to Central Asia and Afghanistan. India will launch some other major venture investments worth US $ 20 billion, including the LNG plant and the natural gas sector of the Chabahar trade zone (June 13, 2016, R. Gupta). The Chabahar deal is seen as a game-changer for Afghanistan, India, and Iran, as well as China, Pakistan, Central Asia, and the Arab Gulf countries. It has had an economic, political, and diplomatic impact, benefiting Afghanistan, India, and Iran from competitors. 6. ROLE OF IRAN After the atomic arrangements and the lifting of Western sanctions, the transaction provided Iran with a wide range of trade and economic development opportunities. To strengthen the implementation of the agreement in the meeting, Indian Prime Minister Modi pay back the US $ 6.4 billion, which owned by the Indian refinery and promised to transfer the remaining quickly (Mulani Nikola, June 11, 2016 mention). This arrangement enables Iran to expand and secure its market share of energy projects in India at the outlay of Saudi Arabia. Moreover, it attracted a lot of investment needed to improve Chabahar and its framework. For India, Iran has allowed the provision of facilities and land to Afghanistan, the nations of Central Asia, and China in order to obtain the benefits of Chabahar. Iran constructed a 600-kilometer highway that links Chabahar to Zahedan, 240 kilometers from Malik on the border between Afghanistan and Iran. In addition, construction work is underway to connect Malik and India's Zaranj-Delaram highway in the Nimrods region (Afghanistan). Iran also began construction of a railway connecting Chabahar and Zahedan, which will be connected to the Iranian railway network, CIS countries, and Central Asia. Third, this arrangement is through tariffs and duties imposed on goods passing through Chabahar; and the Iranian railways use roads and pipelines connecting Chabahar to the nations of Central Asia and Afghanistan Sources of income from
  • 4. 56 Asian Journal of Social Science and Management Technology transportation and transit fees. Iran imposes high tariffs on imports from the Gulf and India, as well as exports from the nations of Central Asia and Afghanistan. Fourth, Iran considers Sabahal as another option in the port of Abbas located in the Arabian Gulf. Any restrictions on the Hormuz will disrupt Iran's transportation and trade and render the port of Abbas useless. Chabahar is a deep-water port in Iran that can enter the Indian Ocean. From a geopolitical perspective, Iran also views the Chabahar Agreement as the key to increasing political impact in Afghanistan, Southwest, and Central Asia; to consolidate its situation in the Gulf region. The expanded political, economic, investment and trade relations between India and Iran may promote strategic cooperation and prepare for more foundational maritime cooperation in the Arabian Sea and the Indian Ocean (Bearak, M. & Murphy, B. 2016 January 5 24). 7. ROLE OF PAKISTAN Chabahar port, together with the India-Iran-Afghanistan trilateral relationship, will undoubtedly affect Pakistan and Iran relations. It poses a direct economic challenge to Gwadar, located 70 kilometers east of Chabahar port. Gwadar port is also a deep seaport, located on important sea lines and land roads that connect Afghanistan and China to the Middle East and the Indian Ocean. Iran used Chabahar to challenge Pakistan, preparing to connect to Afghanistan and Central Asia through railways, land routes and pipelines, thereby increasing the possibility of expanding trade with these countries and obtaining large amounts of energy assets. Similarly, the rapid entry into Chabahar freed Afghanistan from using Pakistan's Karachi and Gwadar ports. As a result, Pakistan lost the source of revenue for customs clearance and customs fees charged for using these ports. Politically, Iran has greater influence in Afghanistan and the Middle East, and Pakistan's common goal is to confront India. Because of its dependence on the ports of Pakistan, Afghanistan needs to be consistent with the Pakistani army's Afghan approach and strategy to some extent. Chabahar's entry into Afghanistan means that Afghanistan can independently develop a strategy without worrying about Pakistan. Similarly, Tehran believes that the Gwadar-Chabahar competition is a way of cooperating with Saudi-Pakistan, and its ultimate goal is to reinforce Iran's influence in the Arabian region. Due to India's presence on Chabahar's western border and the losing its dominance in Afghanistan, Pakistan was unable to transport its natural assets from its eastern border, thus giving Iran the convenience of its operations in the Middle East. Pakistan is worried about Indian existence in Chabahar area. The Pakistani military suspects that India can use the port to monitor Pakistan and collect information about its maritime navigation in Oman and the Arabian Sea. Prime Minister Modi's statement further supports this view: "We have decided to strengthen cooperation between our security and defense organizations on local and maritime security" (Hughes, Lindsay. April 26, 2016). 8. Gwadar, Chabahar, and the Global Powers The geopolitical influence of Gwadar and Chabahar harbors is huge for the competition between Chinese Americans and Indian Chinese in the Indian Ocean and Asia. Each of the three extraordinary forces demonstrates the interests of Baluchistan's important ports and geopolitical regions. It gave impetus to the development of the Baluch nation and their independent activities. Baluchistan lost his freedom in the 19th- century Anglo-Russian competition, and historians called it a "great game." Baluchistan had a supremacy during British rule and became a base to avoid Russians marching towards India and the waters of the Arabian Gulf and Indian Ocean. Baluchistan's independence is a new legacy of the "Great Power Game," marking the good intentions of Baluchi for the British country, especially against Iran and Pakistan. At present, India, China, and the United States are playing a new major power game in the Indian Ocean and Asia. The characteristics of the new game are the same as before: fighting for resources, projecting power, pursuing benefits, and expanding the scope of influence. In such a scenario, the important ports of Chabahar and Gwadar are becoming the main center of the game for similar reasons to the attention of the new great powers in the 19th century: its Geostrategic significance. It stated that the Baluchistan province stands out among the most critical regions on the planet.
  • 5. 57 Asian Journal of Social Science and Management Technology 9. Role of India India's plan in Chabahar is to catch up with its rival China, maintain its energy supply, bypass its opponent, and expand its influence in the nations of Central Asia and Afghanistan. Symbolically, this step is a testament to India's role as an important participant and successor to Britain on the subcontinent. Chabahar will intend to give India the power to challenge China's power in Gwadar. The CPEC is a $ 46 billion mission that connects western province of China through pipelines, roads, and railways to Gwadar, allowing Beijing to enter the Indian Ocean directly. India believes that the development of Chinese bases and spies in the port of Gwadar poses a danger to the Indian Navy in the Hormuz, Oman, and the Arabian Sea. In addition, China and Pakistan also regard CPEC as a key move against India in West Asia. Chabahar's entry is India's policy to stop China's movements in West Asia, the Hormuz, and the Arabian Sea. Moreover, entering Chabahar into Afghanistan has strengthened the cooperation between Afghanistan and India against Pakistan, and has allowed India to enter Central Asia. Similarly, India's goal is to turn Chabahar into an important economic, industrial, and trade hub in the Middle East, and to enter markets in Central Asia and Afghanistan. The Chabahar port will let India guarantee energy transportation from the nations of Central Asia, the Middle East, and Iran, and develop India's commercial and trade market share. India is the second-largest country in oil imports from Iran, second only to China. Chabahar is committed to establishing the energy relationship between India and Iran and allowing India to obtain energy assets in the nations of Central Asia through Afghanistan. As Asia's third-fastest and largest growing economy, energy security is crucial in India's plan to move into Chabahar and connect its ports to Central Asia via pipelines. Chabahar's entry provides new impetus for energy and technology of India to the nations of Central Asia and to respond to fast-growing China in the region, and makes the Turkmenistan- Afghanistan-Pakistan-India pipeline from Iran and Oman to Major natural gas pipeline options in the Indian Ocean. The foreign ministers of these three countries reviewed this plan for the first time in February 2014, but did not proceed because of sanctions imposed on Iran by the West and America. With the lifting of sanctions, this plan proved reasonable, especially for India. Because India has serious doubts about the security issues through Pakistan in the Turkmenistan-Afghanistan-Pakistan-India pipeline. In this way, India will expedite its plan to connect to Chabahar's Central Asia region by pipeline, which can be connected to the Oman-Iran-India submarine pipeline. In view of this, the President of Turkmenistan Berdi Mohamedov and the Prime Minister of India Modi held a meeting in mid-July 2015 to agree on seven arrangements for natural gas, petrochemicals and national defense. The future direction of international development shows that Turkmenistan backings India's accession to the Ashgabat deals on transit and trade issues, including Iran, Uzbekistan, Turkmenistan, Oman, and Kazakhstan, to build this pipeline (Hughes, Lindsay, 2016 April 26). 10. Role of China The competition between Chabahar and Gwadar is actually a competition between India and China for Asian hegemony. Therefore, competition in the Indian Ocean, Central Asia, and Afghanistan; China-Pakistan partnership and Pakistan support; India-China border conflict; and demand for natural assets make the strategic significance of these two ports particularly important. China's plan is to develop Gwadar into an important deep-sea port with an aircraft terminal and commercial, industrial, and maritime facilities. This plan has lasted for more than a decade. The next stage to link the port to western areas of China through pipelines, railways and highway systems, which was planned in the CPEC with a scale of 46 billion US dollars, although it did not make an authoritative response. China believes that the port of Chabahar Agreement is a direct encounter to CPEC and China's offshore investment in the Gwadar port. Gwadar is a key benefit of China's huge investment in CPEC. It will provide China with an important foothold in the Indian Ocean and successfully make China a country under control of the two seas.
  • 6. 58 Asian Journal of Social Science and Management Technology Once the plan is completed, it will be used for military and civilian installations, including sea bases for Chinese submarines and warships. In addition, it will serve as an observation point to inspect Indian and US naval operations in the Indian Ocean and the Arabian Sea. Considering the difference between it and the Hormuz, Gwadar can support Chinese maritime forces to control the way to India or the United States. Soon, Gwadar's further strengthen the opposition between Pakistan and China against India. Gwadar's economic advantages over Pakistan and China are equally huge. Gwadar has developed into a unique business center, especially the export of Chinese goods to Africa, the Middle East and Europe, as well as the import of products and energy. Pakistan and China mostly import its oil from the Middle East, which is very close to Gwadar. Gwadar Port is expected to become an important channel for transporting energy through the pipeline in western areas of China, thereby guaranteeing energy security. China's activities and plans in Gwadar panic the United States and India. A report released by the Indian Defense Research Institute in Delhi worried about China's presence in the port of Gwadar. It said that Gwadar, so close to the Hormuz, would authorize Pakistan to control the energy route. The statement states that Gwadar will enable China to inspect the Indian and US naval movements in the Arabian Gulf and the Arabian Sea, and also any future naval cooperation between the United States and India (Rakisits, Claude, 2015). Just like Delhi's strategy in Chabahar port, China's plan in Gwadar port also faces the Baluch rebellion in Pakistan's Baluchistan region. But China is aware of this, and the pipeline construction from Gwadar into China and Central Asia must wait for the political stability of Pakistan and Afghanistan (Jaffrelot, Christophe. January 7, 2011). 11. Role of the United States The United States shares India's concerns about China's presence and conduct of exercises on the port of Gwadar and the dangers it may pose to the transportation lines of the Strait of Hormuz and the Arabian Sea. Therefore, the United States regards Beijing's activities in Gwadar as a long-period risk. A political leader said: "Actually, Gwadar is important: not today, but it will prove China's goals for the next few years (unclassified cases by the US State Department)." The most important question for the United States is whether China can The region gains strategy, potential and economic advantage. The observations of the United States reflect that in a long period of time, China will become a superpower with a strong maritime advantage. The US also encourages Chabahar to deal with some dissatisfaction with Delhiā€™s investment in Iran port. As the main counterbalance against China, India is Asia's massive business sector and the most important country on the ballot system in the world. It is regarded by the United States as a strategic partner against China in Asia. Pakistan's cooperation with China and its instability in Afghanistan are another focus, which has pushed US policy toward Delhi. In this particular case, the port of Chabahar is also useful to the United States because it can balance China's $ 46 billion Gwadar Corridor and open up another exchange route for Afghanistan. Afghanistan's financial and political strength is critical to the United States' importance. Nisha Desai Biswal (Assistant Secretary of State) said in the US Senate: "In order for India to increase the economic growth of Afghanistan, it needs a national border. India is expanding Contact and find the path or way of this development "(Chowdari, Utara. May 26, 2016). 12. Opportunity for Iran and Pakistan (CPEC) Overall, Iran and Pakistan's relationship have improved significantly. The two nations must resolve their differences on Afghanistan. Pakistan helped Iran solve the problem with the Afghani Taliban, and both nations have a common position on the Afghanistan issue. Pakistan's territorial position is driven by India, and Prime Minister Narendra Modi expressed in some events arrangements for the isolation and siege of Pakistan on a local and global scale. Recently, India's influence in Afghanistan has expanded beyond Iran (Uttara Chowdhury, May 26, 2016). A survey conducted in 2013 by the Pakistan Institute of Peace, Pakistan's religions, and political parties insisted that the relationship between Pakistan and Iran should not be controlled by the United States but should be based on the country of Pakistan's interest. The friendly relations between Iran and Pakistan not only promote cooperation with Iran, however benefit economic, security, and religious harmony. The International
  • 7. 59 Asian Journal of Social Science and Management Technology Monetary Fund (IMF) report in 2013 stated that although Pakistan is Iran's 11th largest business partner, the potential for business between the two nations may be low, despite its geographic location and the foundation that the Economic Cooperation Organization can provide (ECO) framework. Much of the business between the two nations is done by third-country channels, and other illegal economic transactions. This is mainly due to the mandatory sanctions imposed by the West countries on Iran and the fear of sanctions on transactions with Iran. Most importantly, both Iran and Pakistan view China as a confrontation against American hegemony. Iran's consideration in CPEC will help Pakistan. After the current sanctions are lifted, Iran re-enters global development, which is good for Pakistan. Economic and trade dealers from whole world rushed to Iran to encourage cooperation. Experts expect Iran's luck to improve, and the dynamics of the market of oil will change. Iran's revival is a good thing for Pakistan, particularly regarding the long-neglected gas pipeline plan. Before sanctions were imposed on Iran globally, the business volume between the two countries was $ 1.6 billion per year. After the sanctions, Pakistan and Iran's bilateral business decreased to 300 million US dollars. Since the Western countries lifted sanctions on Iran due to atomic energy arrangements in 2015, Pakistan-Iran interaction has gradually increased. That being said, the energy and trade participation between Pakistan and Iran can be expanded by restoring the Iran-Pakistan natural gas pipeline and can meet Pakistan's 25% energy demand. The cost of the Iran-Pakistan natural gas pipeline is as high as the US $ 7.5 billion; in Pakistan, it is about the US $ 1.25 billion. The plan will provide 750 mc ft of fuel per day, and Iranian natural gas may generate 5000MW of electricity. The natural gas pipeline can become an important portion of the CPEC plan; analyst Michael Kugelman said that Gwadar is good for Iran because China will provide a fund to the Pakistan side of the pipeline. In addition, China's large investment in Pakistan may just be a sign of the expansion of China's infrastructure investment. 13. Conclusion The Soviet-Afghan war and Iran's Islamic turmoil put Pakistan and Iran in different religious ideologies and territorial positions. Since 2001, the both nations have worked out ways to keep usual mutual relations, despite the deteriorating situation. For example, unsafe borders and comparative relations with the United States, Afghanistan, India, and Saudi Arabia. After showing its major tendency to Saudi Arabia and its position in the Syrian clash, the current Pakistani administration is working to adjust its relations with Saudi Arabia and Iran. In addition to the Saudi issue, global sanctions against Iran continue to put pressure on the trade and economic exchanges between the two countries. Iran believes that the Saudi Arabia and America are obstacles to the completion of Iran and Pakistan gas pipeline project. Similarly, Iran is also concerned about Iranian personnel working in Baluchistan, Pakistan. As China occupies a greater interest in CPEC and is promoted from its economic and friendly relations with Iran, it is not surprising that Iran supports CPEC. Chabahar's India-Iran plan is seen as a winning step for Afghanistan, Iran, and India. However, its completion faces many difficulties. The main obstacle is the militant forces in Baluchistan, Iran. The second test is the uncertainty of Afghanistan, the partner of the Chabahar agreement. The port of Chabahar could free Afghanistan from its dependence on Karachi, and Gwadar's Taliban threatened the government to disrupt the plan. Third, if Iran violates its commitments under the atomic energy agreement signed a year ago, Western countries and the United States are likely to tighten sanctions. This situation will change India's contribution to the venture. Fourth, the growing tension between Saudi Arabia and Iran, and any Arab-Iranian clash in the Arabian Gulf will undoubtedly have a negative impact on the project.
  • 8. 60 Asian Journal of Social Science and Management Technology 14. References 1. Ahmed Rashid Malik (November 11, 2015), ā€œCPEC and the Regionā€. Pakistan Today. 2. Bearak, M. & Murphy, B. (May 24, 2016), To Sidestep Pakistan, India Embraces an Iranian Port. Washington Post. Retrieved from https://goo.gl/Ae5BLL. 3. Choudhury, Uttara. (May 26, 2016). US Backs India-Iran Chabahar Port Deal as It Outflanks China-Pakistan Gwadar Project. First Post. Retrieved from: https://goo.gl/p6wCbw. 4. Gulati, Monish. (June 11, 2016). India-Iran Agreement on Chabahar is a Strategic Opportunity - Analysis. Eurasia Review. Retrieved from https://goo.gl/k50K0X. 5. Gupta, R. (June 13, 2016). Iran, India, and Chabahar: Recalling the Broader Context. Institute of Peace and Conflict Studies, 5060. Retrieved from http://www.ipcs.org/article/india/spotlight-west-asia-iran-india-and- chabahar-recalling- the-broader-5060.html 6. Hughes, Lindsay. (April 26, 2016). Bypassing Pakistan: Afghanistan, India, Iran, and Chabahar. Future Directions International. Retrieved from http://www.futuredirections.org.au/publication/bypassing-pakistan-afghanistan- india-iran-chabahar/ 7. Jaffrelot, Christophe. (Jan. 7, 2011). A Tale of Two Ports: Gwadar and Chabahar Display Chinese- Indian Rivalry in the Arabian Sea. YaleGlobal Online. Retrieved from http://yaleglobal.yale.edu/content/tale-two-ports 8. Salim Ahmed (February 21, 2016), ā€œCall for Promoting-Pakistan-Iran Bilateral Trade Relationsā€. Pak Observer. 9. Rakisits, Claude. (2015). A Path to the Sea: Chinaā€™s Pakistan Plan. World Affairs. Retrieved from: http://www.worldaffairsjournal.org/article/path-sea-china%E2%80%99s-pakistan-plan 10. Yasmeen Aftab Ali (September 7, 2015), ā€œIran and CPECā€. Pakistan Today. 11. UNCLASSIFIED U.S. Department of State Case No. F-2014-20439 Doc No. C05785443. Retrieved from: https://wikileaks.org/clinton-emails/emailid/6383Sent. INFO:- Corresponding Author: Sahibzada Muhammad Usman, Ph.D. in Geopolitics, University of Pisa, Italy. How to cite this article: Sahibzada Muhammad Usman, Iran-Pakistan Relation: Impact on CPEC, Asian. Jour. Social. Scie. Mgmt. Tech. 2(3): 53-60, 2020.