Islamabad: Pakistan and China on Tuesday signed an agreement to hand over control of the strategic Gwadar port on the Arabian Sea to a Chinese company, a move that has raised serious security concerns in India.
Under the agreement for transfer of concession rights, the deep sea port will remain the property of Pakistan while the Chinese company will share profits from its operation. China Overseas Port Holdings Limited will fully assume responsibility for Gwadar port in Balochistan province.


Speaking on the occasion‚ President Zardari said the agreement would give new impetus to Pakistan-China relations and take bilateral political cooperation into the realm of economic cooperation. The handing over of the operations of Gwadar port to China is a manifestation of growing ties and shows the trust that Pakistan has in the Chinese ability to deliver on infrastructure projects, he said.
The development of a trade corridor linking Xinjiang to the Middle East through Gwadar port will enhance trade between the two countries and in the region, Zardari said. Gwadar has strategic importance for China as around 60 percent of its crude oil comes from Gulf countries that are close to Gwadar, he said.

The agreement was signed by Gwadar Port Authority Chairman Syed Pervez Abbas, Major General Asghar Nawaz of the army-run National Logistics Cell, AKD Security chairman Aqeel Karim Dhedi, Leo Fong of China Overseas Port Holdings and Port of Singapore Authority representative Faisal Javed.

Gwadar Port is a warm-water, deep-sea port situated on the Arabian Sea and the mouth of the Persian Gulf at Gwadar in Balochistan province of Pakistan
Gwadar Port was developed by the Pakistan government at a cost of USD 250 million
Gwadar port is also only about 400 kms away from the Strait of Hormuz, a key global oil supply route
Gwadar Port is featured on the back of Pakistan currency note of denomination five
Pakistan and China sign an agreement to handover Gwadar port
China provided about 75 percent of the initial funding of USD 250 million for building the port
Concern for India: India fears that the port could be used by the Chinese Navy to jostle for geo-strategic power in the region
Singapore's PSA International had signed a contract to manage and develop Gwadar for 40 years. But Pakistan says PSA failed to develop the port as desired
China has been working to develop a string of harbours in the Indian Ocean and Arabian Sea
China, which is Pakistan's closest ally, had for long been a front-runner for taking over the port
China has funded ports in Sri Lanka and has been approached to help build a port in Bangladesh


On January 30, the Pakistan government had approved the transfer of the management of Gwadar port from Singapore to China, which played a key role in its construction. Singapore's PSA International had signed a contract to manage and develop Gwadar for 40 years. Information Minister Qamar Zaman Kaira had said last month that PSA International could not develop or operate Gwadar "as desired". The Chinese will make "more investments" to make the port operational, he said.Pakistan's former defence minister Chaudhry Ahmad Mukhtar had said in 2011 that Islamabad would be "grateful" to the Chinese government if a naval base was built at Gwadar.


Pakistan's decision to hand over the strategic Gwadar port to China is a matter of "serious concern" for India, Defence Minister A K Antony had said earlier this month. "Chinese are now constructing that port on Pakistan's request. In one sentence, I can say that it is a matter of concern to us. My answer is simple and straightforward," he had said. (READ MORE)


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China has been working to develop a string of harbours in the Indian Ocean and Arabian Sea