By Mei Jingya, Sina English
Pakistan is planning to transfer operational control of its strategically important Gwadar deep water port from Singapore’s PSA International to a Chinese company, Financial Times (FT) reported on August 31, quoting Pakistani officials.
“We have reached an agreement with PSA where they have decided to leave the port at Gwadar. They are in discussions with a possible Chinese investor,” Babar Ghauri, Minister of Ports and Shipping of Pakistan was quoted as saying in an interview with FT.
PSA began running the port five years ago under a contract valid for up to 40 years but is now preparing to leave. “There is a decision for PSA to leave and we have given our consent,” said Ghauri, who declined to identify the potential Chinese replacement.
Gwadar, built with the help of a Chinese loan, is close to the Pakistan-Iran border and the Strait of Hormuz, through which much of the Gulf’s oil exports are carried by ship to international markets. Pakistani officials said strategic as well as commercial interests played a part in the change.
In 2011, Chaudhry Ahmed Mukhtar, then Pakistan’s defense minister, told the FT that it had asked China to build a naval base at Gwadar and expected the Chinese navy to maintain a regular presence there.
However, Chinese defense minister General Liang Guanglie, who is now on an official tour to South Asia, denied the report, saying the Chinese government has not discussed the proposal.
According to the report, although the transfer of management control is likely to be portrayed in both Pakistan and Singapore as a commercial decision, any step that increases Chinese influence over its ally Pakistan will be watched closely by the U.S. and India.
Considering the fact that India is always on the alert against every step China takes, “Chinese expansion of interests in South Asian ports” is surely to reinforce concerns in India about ‘encirclement’ by China.
Chinese defense minister General Liang Guanglie is visiting India after his Sri Lanka’s leg.