Gwadar Port, situated in Pakistan’s southwestern province of Balochistan, has attracted regional and geopolitical attention since its construction began in the early 2000s. Initially envisioned as a transformative economic hub for Pakistan, the port has sparked controversy, with allegations as early as 2005 suggesting it could serve as a military foothold for China. While Islamabad has consistently denied these claims, they continue to surface, often raised by U.S.-based think tanks.
For a port that remains underdeveloped and economically underutilized, the attention Gwadar has received on the regional and geopolitical stage raises a crucial question: Why does this modest fishing village-turned-port continue to draw attention to the extent that China refuses to let go of it despite economic burdens and security challenges, U.S. keeps its development in focus, while India continues to invest in Iran’s Chabahar port as a counterbalance to Gwadar’s potential influence.
To answer these questions, it is important to first consider Gwadar’s geographical and strategic position. Although Pakistan’s internal governance issues and security concerns have slowed Gwadar’s progress, its significance cannot be disregarded and isolated; just across the border, Iran’s Chabahar Port, supported by India, plays a role in the region’s power dynamics, but faces its own challenges, particularly shaped by U.S.-Iran tensions.
Together, these two ports offer a lens into the Arabian Sea and Indo-Pacific power dynamics, revealing the interplay of local challenges, regional and global rivalries that continue to influence the development of these ports and define the region’s evolving geopolitical chessboard.
Geographical Allure of Gwadar
At the heart of Gwadar’s significance is its geographic location. Positioned near the Strait of Hormuz – a vital maritime choke point through which one-sixth of the world’s oil and one-third of its liquified natural gas (LNG) is transported, Gwadar sits at the nexus of global trade routes. Its location offers unique opportunities for economic integration and maritime connectivity. As a natural deep-sea port, Gwadar also has the potential to accommodate large cargo shipments as well as naval vessels.
For China, Gwadar serves as a linchpin in its Belt and Road Initiative (BRI) and its flagship project the China-Pakistan Economic Corridor (CPEC) – a $62 billion project, that will provide a direct link to the Arabian Sea and a potential gateway to the Middle East, Africa and Europe. But perhaps the port’s biggest promise is that it will reduce reliance on the vulnerable Malacca Strait.
Currently, China’s maritime lifeline begins at the Taiwan Strait, a vital choke point through which an estimated $2.45 trillion worth of goods transited in 2022 alone, according to the Center for Strategic International Studies (CSIS). From there, it then passes through the South China Sea and Strait of Malacca, where around $3.5 trillion worth of global trade flows annually, as reported by the Institute for Supply Management (ISM). This lifeline then splits into two key routes: one leads to the Persian Gulf via the Strait of Hormuz. The latter extends southward, through the Bab el-Mandeb Strait into the Red Sea, eventually reaching the Mediterranean through the Suez Canal.
These critical sea routes connect China to oil and mineral imports from the Middle East and Africa as well as to key export markets in India and Europe. Any disruptions in these maritime chokepoints would have far-reaching consequences for China.
Gwadar Port’s potential to serve as an alternate route may support China’s long-term strategic and economic vision. However, the economic rationale for such a vision for Gwadar is often questioned. While it could benefit China’s western Xinjiang province, the additional 4,000 – 6,000 kilometers needed to transport imported oil and gas to China’s eastern coasts, where most demand lies, diminishes its viability. The additional over 2,000 kilometers distance from Gwadar to China’s west as well as oil and gas pipelines, also present security risks in Pakistan.
A Strategic Strongpoint in the Making
Hence, U.S.-based think tanks often interpret Gwadar’s development as part of China’s “power projection” strategy, instead. A potential naval base in Gwadar, they argue, could enhance China’s regional influence.
Meanwhile, the U.S. itself currently maintains a strong presence in the Strait of Malacca, conducting military exercises and joint drills with local partners like Malaysia and Singapore, along with allies like Germany, Australia, and Canada. From China’s perspective, this signals its geopolitical rival’s dominance over a critical economic lifeline. This dynamic has pushed China to strengthen ties with Malaysia through infrastructure investments, although Singapore remains cautious despite cultural ties to China. Similarly, the Philippines, once at odds with the U.S., has also strengthened its alliance with Washington in light of China’s territorial ambitions in the South China Sea.
In a hypothetical event of conflict, control of the Strait could jeopardize China’s maritime supply chains. While direct conflict between the U.S. and China is unlikely and economically counterproductive, Gwadar, many argue, offers China a fallback strategic alternative – albeit one that faces significant economic and security challenges.
Gwadar Port remains underdeveloped, with the rail and road networks essential to integrating the port with broader trade routes incomplete. Pakistan’s governance challenges, endemic corruption and local discontent in Balochistan, with an ongoing armed resistance, have further hindered progress.
But despite these security, economic, and infrastructural limitations, many argue that Gwadar may serve as China’s “strategic strongpoint” – a term often described by Chinese experts as alternative bases within China’s long-term regional and maritime strategy.
China’s Security Offers to Pakistan
Over the years, for China, Pakistan’s instability has proved costly, with nearly 100 Chinese nationals losing their lives in Pakistan in terror attacks since the launch of CPEC. Despite these setbacks, China is not ready to give up on Gwadar; instead, it is offering security collaborations.
Following the October 2024 terrorist attack, China’s Foreign Ministry spokesperson announced the arrival of an inter-agency working group in Pakistan to help address the security situation. Additionally, in November 2024, a Joint Working Group on Security from Pakistan visited China to discuss enhanced security cooperation and a draft counterterrorism agreement is reportedly in progress between the two allies.
Gwadar in the Shadow of U.S.-China Rivalry
While China frames its efforts, particularly in the Indian Ocean, within the context of economic cooperation, the U.S. views them with suspicion. The U.S., for instance, has hardened its policy toward Beijing, citing concerns over China’s military expansions “to dominate the Indo-Pacific, challenge global governance, engage in ‘predatory economic practices’ and territorial expansionism,” and its ambition to lead in high-tech industries. The U.S., however, justifies similar actions as essential to defending its global interests, whereas China’s moves are often viewed with greater suspicion.
A 2020 report, for example, by the China Maritime Studies Institute (CMSI) at the U.S. Naval War College stated that even without formally serving as a military base, Gwadar already plays a role in advancing China’s foreign policy objectives. Although such claims remain speculative, they have provided the U.S. with a basis to justify its growing apprehensions over China’s influence in the Indo-Pacific, reinforcing narratives of China’s strategic ambitions in the region. This has prompted the U.S. to caution Pakistan about what is often termed as “risky reliance.”
Balancing U.S. and China: A Tightrope Diplomacy
Pakistan’s National Security Policy (2022 – 2026) reinforces neutrality in great power competition, striving to maintain balanced and beneficial relationships with both the U.S. and China.
For over two decades, Pakistan’s partnership with the U.S. was shaped by Washington’s counterterrorism focus, given its military presence in Afghanistan. This security-dominated relationship began to unravel as U.S. troops began to leave Afghanistan. The U.S. suspended $2 billion in security assistance to Pakistan in 2018. By June 2023, the U.S. aligned with India in criticizing Pakistan for terrorism, signaling a strategic shift toward its long-standing ally.
In response, Pakistan deepened its ties with China. Amid Pakistan’s 2023 IMF bailout negotiations, China provided a $1 billion loan in June. However, the U.S., viewing Beijing’s growing influence, helped Pakistan secure a $3 billion IMF package the following month.
While Pakistan leans on China for infrastructure and economic support, it recognizes that U.S. strategic backing is indispensable. The U.S. is also cautious about allowing Pakistan to drift fully into China’s orbit, given Beijing’s expanding regional influence.
These dynamics are reflected in U.S. diplomatic engagement with Gwadar as well. In 2021, Angela Aggeler became the first U.S. envoy in over 15 years to visit Gwadar, followed by U.S. Ambassador Donald Blome in late 2023.
Gwadar is also where the Pakistan-Iran gas pipeline project, signed in 2010, passes and could benefit the port and overall country, but the project has been stalled due to U.S. sanctions on Iran. Having invested $2 billion already, Iran has filed a $18 billion dollar arbitration case against Pakistan for noncompletion. Islamabad, seeking a U.S. sanction waiver, met firm opposition from Washington. Pakistan has now engaged two U.S. law firms for representation in the case at the International Court of Arbitration.
Chabahar: India’s Strategic Answer
Only 70 kilometers west of Gwadar lies Iran’s Chabahar Port, a key strategic gateway to Afghanistan and Central Asia that bypasses Pakistan’s Gwadar and Karachi Ports. India has heavily invested in Chabahar, aiming to open a land route for Indian goods into Central Asia while positioning the port as a counterbalance to China’s growing influence in the region, particularly in neighboring Gwadar.
Chabahar is the only Iranian port exempt from U.S. sanctions. This exception, granted in 2018, covered the port’s development, its railway link to Afghanistan, and the transit of non-sanctioned goods. Then-U.S. Secretary of State Mike Pompeo said in a statement, “The port is exempted so it could provide economic support to landlocked Afghanistan.”
Washington’s decision to exempt Chabahar port from certain sanctions and let India invest reflects a calculated strategy: countering China’s growing influence in the region, since there is a clear concern that if India withdraws from Chabahar, Beijing could take over the port.
In May 2024, India signed a 10-year operational agreement for Chabhar’s development. Despite Iran’s non-recognition of the Taliban regime, in late February, Kabul announced a $35 million investment in Iran’s Chabahar Port. Pakistan’s blockade of Afghan trade also led Kabul to favor Chabahar over Gwadar.
Geographically, Chabahar and Gwadar share similarities, but they serve different political purposes. While Gwadar remains central to China’s regional ambitions, Chabahar has emerged as India’s effort to counterbalance Chinese influence. However, both ports face challenges: While Gwadar contends with an insurgency in Balochistan, security concerns and economic issues, Chabahar remains vulnerable to shifting U.S. sanctions and regional instability, particularly as tensions in the Middle East escalate.
China, on the other hand, has shown limited interest in Chabahar due to India’s prominent role and the risk of U.S. sanctions, despite a broader partnership with Iran. While India’s expanding activities in Chabahar have nudged Beijing towards investing in Chabahar for influence, it has remained more cautious.
However, a 25-year cooperation agreement between Iran and China – a comprehensive strategic partnership — was signed in 2021 focusing on economic and security cooperation. The exact details haven’t been publicly released in their entirety. In 2022, China also opened a Consulate General in Iran’s Bandar Abbas Port, which is only 660 kilometers from Chabahar. As India and China vie for dominance in the region, Iran maintains partnerships with both powers, while capitalizing on their competition.
Both Gwadar and Chabahar ports stand as critical nodes in the evolving dynamics of global trade and regional power strategies. Their success hinges on more than just infrastructure; It depends on global competing interests.