One cannot deny the inexorable advantage that geography has given Pakistan-occupied Kashmir (PoK). Being the only link between the Peoples Republic of China (PRC) and Pakistan, PoK is truly the ‘umbilical cord’—a bond that is symbolical of the very deep relationship between the two countries. The PRC has at various forums asserted that it only has an economic interest in PoK and has openly denied the presence of People’s Liberation Army (PLA) personnel in PoK. However, in a recent interaction with some Chinese scholars, a new perspective highlighting the true importance of PoK in China–Pakistan relations was put forward by one such scholar. 1 He said that China would never allow the Kashmir dispute to be settled on terms that were favourable to India, because that would leave China with no border with Pakistan. In other words, should the Kashmir dispute be settled so that PoK (which includes the so-called ‘Azad Kashmir’ and Gilgit-Baltistan (GB)) is awarded to India, the ‘umbilical cord’ will be snapped, leaving China’s ‘all-weather friend’ orphaned. Such an explanation merits a deeper analysis of China’s long-term perspective on PoK and its growing interests in PoK. Are these interests an indication of the permanent presence of China in PoK? Is China creating Gilgit-Baltistan as a ‘buffer state’ to stem the spread of Islamic fundamentalism into Xinjiang? This commentary, based largely on Pakistani sources and press reports, examines the possible strategic interests of China in PoK.