China Overseas Port Holding, will establish a special economic zone of over 152 hectares at the deep sea port of Gwadar, Pakistan. The government of Baluchistan –Pakistan’s poorest- will later on provide the rest of the land to the Chinese corporation, which will own for more than 40 years a tax-free 923-hectare land.

The Pakistani authorities gave the permission to the Chinese state-owned company to lease the land for 43 years. According to China Daily, Gwadar is considered to be at strategic location as it stands between South and Central Asia and the oil-rich Middle East. The Chinese state company will be in full charge of the Gwadar zone.

The agreement between the two sides is part of the China-Pakistan Economic Corridor, which is a massive investment project worth $46 billion aiming to connect western China to the Arabian Sea.

The firm promised to create a trade-oriented powerhouse, including the construction of an export zone and an international airport. “China has asked us to provide land for building an export processing zone and a modern international airport in Gwadar,” Baluchistan chief minister Abdul Malik Baloch told AFP. China will also build another sea port and a road network to link the trade zone to the airport.

Wang Shida, a trade expert who works at the Chinese Institute of Contemporary Relations said that the new agreement between Pakistani authorities and China is a win-win deal. “The Pakistani economy will gain from the large number of processing firms that will move to the Gwadar port. It will also boost export from Pakistan. As for China, it will gain from cheaper oil imports from the Middle East and opportunities for Chinese companies will go global,” he told China Daily.

AFP reported that the economic zone will be guarded by a special security force of between 10,000 and 25,000 men. Moreover, the French news agency underlined that the Pakistani province has plenty of resources including oil, gas and minerals.

Some people in Baluchistan, already criticised their authorities of doing little to raise the living standards for the locals, giving way too much benefits to the Chinese firm without ensuring the local interests.