The Pakistan Occupied Kashmir (POK) is still a part of India, even it is occupied by Pakistan.
How, then, can China build the China–Pakistan Economic Corridor (CPEC) via the POK? Is this acceptable by international laws?
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The POK (Pakistan Occupied Kashmir) is still a part of India even it is occupied by Pakistan.
That is not true.
According to the UN resolution adopted in 1948, Kashmir is a disputed territory.
Then how can China build the CPEC (China–Pakistan Economic Corridor) via the POK?
This is actually becoming possible because of China's influence on the International community, and its economic and military muscle, which has actually become the norm in the modern world.
India could have resisted this initiative if India were the permanent member of UNSC which India is not at the moment.
Is this acceptable by international laws?
International Law is not much effective when a military muscle is involved. Most of the time, it is like might is right.
For instance, Turkish Cyprus, and more recent Crimea situation. None of them were solved by international laws.
I doubt any other country wants to get into the hornets' nest which Kashmir is. So in practice, nobody will help India preventing CPEC.
International Law basically is a "whatever happens to be done in practice."
Combine those two observations, and a case can be made that international law allows CPEC.
To stopping the building of CPEC in gilgit baltistan is completly depends on the bureaucracy and diplomacy of India because the party which is constructing the CPEC is member of UNSC. What India can do is to remind/force Pakistan to follow shimla agreement and UN resolution 47, which will unable to pass day by day if 3rd party like china invested heavily in POK and any dream of anyone plebiscite on Kashmir will fall heads down.
Quoted from Wikipedia article:
Both countries will "settle their differences by peaceful means through bilateral negotiations".1 India has, many a times, maintained that Kashmir dispute is a bilateral issue and must be settled through bilateral negotiations as per Simla Agreement, 1972 and thus, had denied any third party intervention even that of United Nations.
International law is not very powerful. And gets even less powerful when a UN security counsel permanent member is a involved. It would be the occupying part that would receive any attention internationally not the construction, unless there is a treaty (with a third party) banning construction.
Pakistan seems to control POK, so much so that China is willing to bet construction costs. And the fact of infrastructure improvements tend to support Pakistan owning rather then occupying the area. That's pretty bad for India's chances.
Think about how hard it is to interfere with genocides, and that's when everyone agrees it's a bad thing and a veto country is not really that invested.