A spokesman for Pakistan's ministry of ports and shipping, Mohammed Raza, has said the cabinet agreed Wednesday to the deal. Raza said Friday that the transaction has not yet taken place.
The port is considered to be located strategically at the apex of the Arabian Sea and the mouth of the Persian Gulf. It is about 400km away from the Strait of Hormuz, a key global oil supply route.
India has been uneasy with China's increasing presence in South Asia through investments in ports - like the port at Hambantota in south Sri Lanka - and important infrastructure projects.
But an opinion piece in the state-run Global Times newspaper on Friday said the Pakistan project was not aimed at militarily encircling India; it was of crucial economic interest to China and could help develop China's western regions.
"Not surprisingly, many analysts from the West and India believe that China harbors the intention to build naval bases there. Chinese operational control of Gwadar has seemingly set off alarm bells in India as it feels it is being encircled by China," Global Times said.