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Who bought Gwadar for Pakistan?

Gwadar is a deep sea port on the south coast of the Arabian Sea in the Pakistani province Balochistan which, since 2002, has been completely redeveloped as a strategic trading hub. Until 1958, it was actually a part of the country of Oman, and a survey carried out by the US discovered that it had the potential to be transformed into a deep sea port. A deep sea port is one capable of handling large, heavily loaded cargo ships, of the kind which dominate international trading across the world’s oceans. In order to be recognised as a deep sea port, Gwadar has to offer not only the capacity for such ships but also the infrastructure to load and unload them, such as dockside cranes.  It was this survey, however, carried out back when Gwadar was little more than a small fishing village, that kick-started the process which finally resulted in Gwadar being purchased by Pakistan.

Although the actual purchase took place in 1958, the modern development of Gwadar is part of the CPEC (China-Pakistan Economic Corridor), a series of major infrastructure projects being developed in a partnership between the governments of China and Pakistan. The location of Gwadar is key to the vital role it will play in CPEC as a trading hub – it was as pivotal in it being singled out for large scale redevelopment as the fact that it could be developed as a deep sea port. It is located just 170km east of Chabahar port in Iran and 120km southwest of Turbat, and occupies a spot which can accurately claim to be the gateway to the Strait of Hormuz. This strait of water sits between the Persian Gulf and the Gulf of Oman and is the means by which ships can travel from the Persian Gulf to the oceans of the world. Because of this, it sees as much as 20% of the petroleum produced in the world pass through it, and a port located where Gwadar is has the potential to create trade routes running through and between the Middle East, South Asia and Central Asia.

It was this potential which prompted the Pakistan government to buy Gwadar from Oman. Negotiations began as soon as the US survey results mentioned above became apparent, and after four years the sale was agreed for a price of $3 million. In modern terms, that translates as roughly $22,410,311 which, although a sizeable amount of money, could still represent a genuine bargain once Gwadar is established as the key hub in a route which runs all the way to Kashgar via 3,000km of road, rail and pipelines.

The negotiations in 1954-8 took place between representatives of the Pakistan government and the Sultan of Muscat and Oman, Said bin Taimur. There were some conditions attached to the sale, and one of these was that the port of Gwadar should be the site of the kind of development taking place there today. As is often the nature of large scale infrastructure projects development was slow, however. Plans to connect Gwadar to the main Pakistani road and rail network, at the same time as developing the deep sea port, weren’t actually finalised until 1993, and even then it was another 9 years until construction began. Once work started it progressed quickly, however, and the deep sea port of Gwadar was opened on 20th March 2007.

The money to purchase Gwadar initially came mainly from donations made by wealthy individuals keen to help the country exploit this natural asset, with some funding topped up by tax revenues. The money which is being pumped into CPEC on the other hand, comes from China, through a combination of government funding and private investments.

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