China has handed over a second Hangor-class submarine to Pakistan under a strategic agreement that is meant to enhance the nation’s naval capabilities. The submarine, which is an export variant of China’s 039A model, was commissioned in Wuhan, China, and comes with advanced sensors and weapons.
This move is under a deal between the two allies for the supply of eight submarines, four of which will be manufactured in China and the remaining built in Karachi through a transfer of technology program. The estimated cost of the deal is about $5 billion and is aimed at boosting Pakistan’s naval presence in the Arabian Sea and the Indian Ocean.
China-Pakistan Military Cooperation Deepens
The launch ceremony witnessed the presence of Pakistan Navy chief Admiral Naveed Ashraf, who highlighted the importance of the Hangor-class submarines in enhancing regional security.
“The project is moving according to the schedule. We hope that these submarines would be inducted into the Pakistan Navy fleet in the near future,” Ashraf remarked.
China has been one of the main suppliers of advanced weapons to Pakistan. Apart from the submarine contract, Beijing has already supplied four new naval frigates in the past, two of which were commissioned in the Pakistan Navy in 2022. Vice Admiral Ovais Ahmed Bilgrami said these submarines will contribute to “balance of power and maritime order in the region.
It is China’s enhanced naval presence in the Arabian Sea, including the development of Gwadar port in Pakistan, which is seen by military experts as a strategic effort to counter rivals in the region and increase its influence.
Pakistan’s Financial Troubles Raise Questions Over Payments
Despite having its growing military capabilities, the financial woes of Pakistan leave everyone wondering whether they can continue to sustain such costly purchases. For years now, the nation has been grappling with an economic crisis, relying chiefly on foreign loans to survive.
Pakistan’s finance ministry adviser Khurram Schehzad last week confirmed that China rolled over a $2 billion loan to Islamabad. With China sitting on almost $29 billion of Pakistan’s debt, Beijing has emerged as the country’s largest creditor.
Economist Kaiser Bengali cautioned that Pakistan’s increasing debt burden is not sustainable.
“The mountainous debt pile is suffocating the economy,” he stated, pointing out that China may not go on lending these loans forever.
China’s Influence Over Pakistan’s Economy
China has been an integral part of Pakistan’s economy, especially by means of the China-Pakistan Economic Corridor (CPEC), a major component of Beijing’s Belt and Road Initiative. Yet experts contend that lack of proper implementation by Pakistan has prevented timely returns on such investments.
Islamabad-based economist Safiya Aftab pointed out Pakistan’s failure to use Chinese loans effectively.
These loans were lent for infrastructure, which on paper is expected to begin yielding returns. The biggest problem in my view is the weak absorption capacity of Pakistan,” Aftab told a news outlet.
On the other hand, Chinese investment specialist Azeem Khalid identified the problem that Pakistan has in servicing these loans because of excessive interest rates.
The more relaxations and extensions, the more it is good for Pakistan. China, knowing Pakistan’s economic woes, tends to give elbow room but takes recourse to this debt sometimes,” Khalid said.
Rising Fears of a ‘Debt Trap’
As Pakistan keeps relying on Chinese economic assistance, fears over a possible ‘debt trap’ have emerged. Experts are worried that Beijing’s control over Islamabad would grow stronger as Pakistan finds it difficult to service its loans.
A Stockholm International Peace Research Institute (SIPRI) report found that Pakistan imports 81% of China‘s advanced weapons, thereby being China’s biggest arms importer. Between 2020 and 2024, Pakistan purchased various advanced defense systems such as reconnaissance drones, battle tanks, and fighter jets.
As Pakistan’s external debt repayment schedule in fiscal year 2025 crosses $22 billion, with close to $13 billion of it being bilateral deposits, financial analysts wonder how long the nation can continue to borrow at such large amounts.
While China is reinforcing its military alliance with Pakistan, the question remains: Can Pakistan really afford these acquisitions, or is it further entrenching itself in its dependence on Beijing at the expense of its economic sovereignty?