WHOSE LAND, WHICH LAW?
Legal Issues and Implications of the China Pakistan Economic Corridor (CPEC)

P. Joseph Mario Ritvik

The China-Pakistan Economic Corridor (CPEC) is, essentially, a framework for regional connectivity. The aim of the project is to connect China’s north-western region of Xinjiang to the Gwadar port of Baluchistan. It is a part of the “Belt and Road Initiative,” a Chinese Initiative for boosting multinational economic cooperation and prosperity. At the international level, legality is frequently overshadowed by geopolitics. When it comes to a project such as the Belt and Road Initiative, despite being initiated at the international level, the entire project is entirely dependent on the domestic legal frameworks of the member states for actual implementation. The China-Pakistan Economic Corridor requires that the legal system in Pakistan is geared and ready for the incoming projects and the inevitable legal disputes that may arise given the involvement of several private parties from both China and Pakistan. The current international treaties and covenants between the two nations will also play a significant role in the success of the CPEC as any development and investment from China into Pakistan will be governed by these treaties. Apart from the legal practicalities of the actual CPEC projects, the legal tangle between India and Pakistan over the Gilgit-Baltistan issue will also play an important role in determining the success of the CPEC. This monograph makes an attempt to cut through the political rhetoric and promises of economic development from China to see whether the legal climate in Pakistan is suitable for the CPEC to take off and bring in the promised economic rewards that Pakistan hopes to gain by partnering with China.

P. Joseph Mario Ritvik holds a BBA, LLB (Hons) degree from the VIT School of Law (VITSOL), Chennai. As a Legal Associate he is currently working in corporate law, labour law, real estate law, intellectual property rights law, and transaction verticals. He is also skilled in legal research, drafting, and vetting. He was a research with the Chennai Centre for China Studies and this monograph was completed as a part of the internship programme with C3S.

Contents

Foreword

Preface

Acknowledgements

Abstract

Introduction

Brief History of the CPEC

Part I: The International Trade and Investment Regime between China and Pakistan

• China–Pakistan Trade Regime and Framework
• China–Pakistan Foreign Investment Regime
• Divergence and Conflict in Treaty Provisions
• Policy Framework for Protection and Development of Investment
• Domestic Laws on Investment Protection

Part II: Dispute Settlement Framework for CPEC

• China and Pakistan’s Tryst with International Commercial Dispute Settlement
• Dynamics and Implications of Possible Disputes in the CPEC
• Role and Legal Status of Chinese SOEs in a Possible Legal Dispute
• China’s Unilateral Claim of Jurisdiction over BRI Disputes
• Conflict with the Existing Dispute Settlement Regime
• Current Dispute Settlement Regime Between China and Pakistan

Part III: India’s Legal Concerns Over Territorial Sovereignty—Role in CPEC

• A Brief History of the Gilgit–Baltistan Issue
• Pakistani Administration of the Region
• The Gilgit–Baltistan Order 2018
• Domestic Resentment against the Order
• The Indian Response
• China’s Involvement in the Region
• Economic Projects in a “Disputed” Territory
• The Way Forward—Legal or Political?

Conclusion