A non starter . Reasons :
1. Anything for India that passes through Pakistan cannot be guaranteed to remain operational, eg : Gas pipeline.
2. The CPEC passes thru disputed territory possibly even along areas illegally ceded by Pak to China. Joining it would amount to an acceptance of illegal ownership of land.
3. Investments in Chabahar.
It could potentially become a starter if we just consider it for a moment.
(1) Of course it can't be guaranteed to remain operational but then again nothing can. So what we have to look for instead is whether certain circumstances can be created to make sure that disruption in CPEC becomes far too costly for any country. This can be achieved by having treaty safeguards in place like the Indus Water Treaty which has stood the test of time despite our disagreements with each other. In addition the number of countries involved would make it extremely difficult for Pakistan to unilateral throw a spanner in the works because trade between China, Russia, the Central Asia States, Iran, Afghanistan and possibly more countries to follow with India will ensure that the international costs of such an action will be astronomical to the point of being suicidal.
Yes one can come up with scenarios like 'what happens in war' but then thats the very purpose of having such an agreement because economic integration makes war extremely costly for either countries and through such economic integration we woild end up creating lobbies of 'peace' within each country who don't want tensions between the two states if for no other reason than the disruption of trade. In addition again the international consequences of a misadventure like Kargil or Siachin would be too great for either country to contemplate. In pretty much the same vein the amount of meddling we do in each other's internal affairs would drastically reduce as well.
Lastly it might even herald in an era of genuine peace, prosperity and intergration between the two South Asian neighbors the likes of which hasn't been seen since before '65 war.
(2) Look lets consider the ground realities before us. Neither of us can do jack sh*t to each other. You can't capture our Kashmir and we can't capture yours. The best solution is to have a Republic of Ireland vs Northern Ireland kinda arrangement in place - freedom of movement and the choice to hold dual nationalities of the citizens and represent either Ireland. But such a solution requires a great deal of maturity on both our parts that I don't foresee happening till much later. In the meantime heres what we can do: We write up a treaty that ensures that CPEC is operationalised without prejudicing the final solution to the Kashmir issue. Its like when Pakistan recognized (and not ceded) Chinese controlled Kashmir to China, the border agreement states something to the affect that the final boundries will be revisited at or subject to the final settlement of the Kashmir Issue.
I'm not a lawyer but perhaps something can be evolved like they did for the Good Friday Agreement to end the Troubles in the 1990s.
(3) Chabahar is not a competitor to Gwadar it is seen by both Iranians and Pakistanis as something complimentary to Gwadar. The amount of traffic thats going to pass through this region when China, Russia, the Central Asian states and others get on board with the CPEC will probably be more than Gwadar can handle. In addition Gwadar still provides the shortest land-route between India and Pakistan as part of CPEC you guys could just as easily disembark at either Chabahar or Gwadar and drive it to India over land. Imagine the industries that this would create in the Indian states bordering Pakistan.
Heck it might even make Indian administered Kashmir and Pakistan administered Kashmir more prosperous if they're economically integrated with the CPEC.
Its a win-win for both India and Pakistan, if...and thats a big 'if', we can learn to look beyond our jingoism and parochialism.
Just imagine the dividends of 'peace' for the region.
(4) There is one downside though; if things normalize between India and Pakistan....I'm gonna steal all your women with my suave and charm.
Wait...is that why you're against this project?
Oh don't worry I can be your wingman when we hit the night clubs of Delhi together.