But this time is different. China's reply is very direct: $1 billion can be given, and Pakistan has to find a way for the remaining 6 billion.

The precarious Karakoram Highway

For Pakistan, the Karakoram Highway is the economic lifeline. If this line is interrupted, Gwadar Port will become a display, agricultural products from the northern region will not be transported, and the China-Pakistan Economic Corridor will be paralyzed.

And now Pakistan is also encountering an embarrassing situation: Ruth repairs, but she can't get the money out of her pocket.

If you look at the data for 2025, you will know how difficult it will be for Pakistan. Foreign exchange reserves are less than 10 billion US dollars, debt accounts for nearly 60-70% of GDP, and the financial situation is to say that it is barely surviving.

Under this circumstance, Pakistan had no choice but to turn to its old friend China for help. In September this year, the leaders of the two countries reached an agreement on the first phase of the recovery plan through a video conference, and US$2 billion in start-up funds were secured.

But this money is just a drop in the bucket. The budget for the entire project is US$8 billion, and the remaining funding gap is like a bottomless pit. Pakistan also admitted that they really could not collect such a large sum of money in a short period of time.

In essence, this is also a multiple-choice question for China: if you help, the investment will be large and risky; if you don't help, years of strategic planning will be in vain. But in the long run, this investment will not be a loss.

After all, the Karakoram Highway is not just a road, but an economic artery connecting the two countries.

For Pakistan, this is a life-saving road. If roads are not repaired well, it will not only be a transportation problem, but the entire economy will be affected.

China’s smart investment experience

This time, China has come up with a new strategy to help Pakistan build roads. It is not like the previous one where it was all covered by one hand, but a new model of "group development".

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For the US$2 billion used in the first phase, China did not just take the money by itself, but also brought in the World Bank and the Asian Bank to work together.

China has done its own technical support and coordination work, but not much real money has been released. This is a great idea, there is no risk involved in helping.

This method of "joining multiple places" was not an idea. On the one hand, it is to control debt risks; on the other hand, it is also to silence those who love to say that China engages in "debt trap diplomacy."

Moreover, the new plan is better conceived. Once the road is built, transportation capacity will be doubled and transportation time will be halved.

In this way, tolls and trade income will naturally increase. This is equivalent to installing a money printing machine for Pakistan, so that it can earn money to pay off its debts in the future.

To put it in the simplest terms, China has adopted the approach of “teaching people how to fish”. It’s not simply giving money to help, but helping to build a framework for sustainable development. Now that Pakistan can make money on its own, it doesn't have to beg for assistance all the time.

Although this is a bit of a detour, it is actually very clever. On the one hand, I have done something for an old friend, and on the other hand, it has given "life" to the entire project.

But Pakistan also has its own methods and has used all the connections it can, including the Islamic Development Bank and the sovereign funds of Arab countries.

There are even plans to open up investment in some projects to private companies, such as small businesses such as logistics parks, service stations, and gas stations along highways. This method is indeed very practical. After all, capital will come naturally when it smells it.

But money alone is not enough. The World Bank has warned Pakistan in advance: Your project management standards are terrible and corruption is common.

If the old problems are not handled well, let alone 6 billion US dollars, even 600 million US dollars will be lost.

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Once repaired, there are still many business opportunities. From Gilgit to Kashgar, the transportation time can be saved by 3 hours after reconstruction. This number is not small.

You must know that time in cold chain transportation is money. Fruits and vegetables that were originally damaged when shipped to their destination can now arrive fresh.

Some specialties from northern Pakistan, such as cherries, mangoes, honey, etc., were not transported quickly in the past, making it inconvenient to sell them to places with long distances. Now that the transportation speed has accelerated, the sales market has naturally become larger.

Local entrepreneurs in Pakistan have also sensed business opportunities. Textile factory owners say this:

To ensure smooth transportation channels for raw and auxiliary materials, build warehouses on the roadside. These people are all veterans. Since they are willing to invest money, they must see that this road has great prospects.

This change is quite good. You must know that if a place wants to get better, it cannot just rely on external investment, but must revitalize its own economy.

From "strong buddy" to "partner"

This cooperation in the restoration of the Karakoram Highway has given people a new way to open up the "iron" relationship between China and Pakistan.

In the past, "iron" mainly meant sharing weal and woe. The "iron" now is the relationship that has become a true partnership. This is not just a relationship of paying for work, but a sharing of risks and benefits.

The way this collaboration works is interesting. China does not do everything, but works together with the World Bank and the Asian Development Bank.

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Such a "multi-party co-construction" model not only resolves the outside world's doubts about the "Belt and Road", but also makes the project more internationally credible.

Replacing "I'll do it for you" with "Let's do it together" may seem simple on the surface, but it actually has a profound meaning. This also shows that China-Pakistan relations have entered a more mature stage.

It is no longer simply one-way assistance and passive acceptance, but has become a truly equal partnership in which both parties cooperate with each other. This has a certain reference effect on a global scale.

This is also a revelation to other countries. They don’t wait for help from others, and they don’t add any burden to themselves. They just rely on mutual cooperation.

This time the road is not just a road construction, it is actually an experiment of a new way of international cooperation. Through multi-party participation, market-oriented operations, and strong hematopoietic capabilities, an infrastructure project can be turned into a propeller for regional development.

Tell people that international cooperation is not a multiple-choice question, but that there are many choices. The key is to find a mutually beneficial intersection.

Therefore, a real good friend does not just help you, but teaches you how to solve problems on your own. This time China-Pakistan cooperation is a big step in this direction.

References:

Prime Minister of Pakistan asks for help via video: The road is broken and we need 7 billion. China’s reply is surprising

tencent.com

Pakistan Railways asked China to solve difficult problems. China put forward conditions. Pakistan Railways needs to raise US$6 billion by itself.