Despite China committing approximately $62 billion to the China-Pakistan Economic Corridor (CPEC), Pakistan has been unable to convert that massive infrastructure investment into sustained economic growth, industrial competitiveness, or broad-based prosperity, according to an analysis published by the Karachi-based Business Recorder and sourced by the Directus news website. The report argues that the failure stems primarily from policy shortcomings on Pakistan's part — not from the investment itself.

The Infrastructure-First Trap

The central critique in the report is that Pakistan built physical assets before establishing the economic foundations necessary to support them. Power plants were commissioned before sufficient demand existed. The Gwadar Port was developed before the industries that would generate cargo materialised. Electricity purchase contracts were signed before markets were ready to absorb the supply.

The result was a structural mismatch that left Pakistan holding expensive infrastructure with limited economic return. As the report notes, 'successful ports emerge where trade exists, successful industrial zones emerge where firms can compete, and successful logistics hubs emerge where production is already occurring.'

Electricity Tariffs That Undermined Industry

Among the most consequential failures, according to the report, was the contracting structure for CPEC-linked power plants. The terms produced electricity tariffs that became progressively uncompetitive relative to regional peers. Industrial consumers in Pakistan reportedly found themselves paying electricity prices nearly twice those faced by competitors in Bangladesh, Vietnam, India, Indonesia, and large parts of China itself.

The report describes this as 'the most damaging legacy of the entire exercise' — a power sector built at scale but priced in a way that hollowed out the industrial competitiveness it was meant to enable.

Gwadar: A Port Without an Ecosystem

The original CPEC vision for Gwadar was far more ambitious than a single port facility. It envisioned an integrated ecosystem encompassing a deep-water port, industrial zones, logistics services, export-oriented manufacturing, urban development, and regional trade connectivity. The port was conceived as an anchor, not the entirety of the project.

In practice, Pakistan concentrated investment overwhelmingly on physical infrastructure — roads, port facilities, and master plans. The industrial ecosystem required to generate cargo volumes, attract investment, and create employment never emerged at the scale envisioned. Critical prerequisites for investor confidence — affordable energy, reliable utilities, skilled labour, predictable regulation, efficient customs, and market access — remained underdeveloped.

Balochistan Unrest and the Development Deficit

The report also addresses the recurring security incidents targeting CPEC-related personnel and infrastructure in Balochistan. It cautions against viewing this instability purely through a security lens, arguing that the violence must also be understood within the context of long-standing regional grievances, uneven development, and the failure to deliver sufficiently visible local economic benefits.

The analysis is careful to note that terrorist violence is never justified, while simultaneously arguing that policymakers cannot afford to ignore the developmental context in which such instability persists. This framing positions the Balochistan problem as, in part, a consequence of the same planning failures that undermined Gwadar and the power sector.

The Broader Lesson

The report concludes that the CPEC debate has been distorted by two equally unhelpful extremes — those who credit it as a transformational success and those who blame it for Pakistan's current economic difficulties. Both narratives, it argues, obscure the real lesson: that infrastructure investment, however large, cannot substitute for the policy environment, institutional capacity, and sequenced economic planning required to translate physical assets into productive growth.

With CPEC entering a new phase of implementation discussions, Pakistan's ability to course-correct on these structural gaps will likely determine whether the corridor's remaining potential is realised or further deferred.