Small and Medium Enterprises are growth incubators for the sustainable development of any country. On the other hand, the China-Pakistan Economic Corridor (CPEC) is considered as a game changer for development of Pakistan in socio-economic sectors. Therefore, this study unravels the nexus of CPEC and its influence on SMEs of the country. It is a perception-based exploratory study to figure out avenues of development, challenges and prospects related to the CPEC for Small and Medium Enterprises (SMEs). The methodology adopted for this study is qualitative thematic analysis which included key-informant and in-depth interviews with relevant policy makers, stakeholders at Federal and Provincial level and SMEs (in district Multan). The study covers perspectives of policy makers which includes the Ministry of Industries and Production, CPEC Officials from the Ministry of Planning, Development & Reforms, Small and Medium Enterprises Development Authority (Head Office and Regional Office) and Multan Chambers of Commerce and Industries; perspectives of facilitators of SMEs such as Pakistan Small Industries Corporation, SME Bank, State Bank of Pakistan, Technical Education and Vocational Training Authority and Commercial banks; and perspectives of SMEs of handicrafts, textile and food processing clusters about the current status , avenues of opportunities and challenges for SMEs in the post-CPEC scenario. The findings of the study highlighted that the stakeholders from Government side were well aware of opportunities and challenges of the CPEC for SMEs. But, the SMEs of Multan are not that much well aware of prospects and challenges related to the CPEC project especially the Small Enterprises due to lack of awareness and lack of involvement SMEs in the main agenda of the CPEC. Moreover, as per their statements, it is quite an early stage to anticipate influence of the CPEC on SMEs because CPEC is just in its initial phase right now. However, the SME Policy is being revised in the context of CPEC agenda which will clearly define the pathway for development and inclusion of SMEs under the CPEC. The study recommended policy measures to be taken in the context of CPEC as well as in general to strengthen the position of SMEs in the manufacturing sector including One Window facilitation for SMEs, alignment of SME Policy with CPEC Agenda and introduction of Global Value Chains and International Production networks for the SMEs. Supervisor:- Dr. Iftikhar Ahmad