CPEC proceeding fast

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Asrar Raouf` brings to fore the benefits of CPEC

Wind Power Project

CPEC has come up much in the system as is now producing results. Unfortunately, the current media attention is critical owing to the lead given by the new government despite the wide attention CPEC has given to various socio-economic factors of Pakistan. Contrary to widespread beliefs, infrastructure projects under the CPEC will promote Pakistan’s North- South interconnection and help Pakistan’s coastal areas to strengthen ties with the northern areas promoting the coordination and development in length and breadth of the country.

Through CPEC China has undertaken to promote bilateral industrial cooperation with Pakistan with a view to equip Pakistan for taking large-scale industrialisation. China also plans to develop industrial zones in various areas of Pakistan and is encouraging Chinese enterprises to actively participate in economic activities in Pakistan.

Chinese side has proposed that special economic zones will be equipped to provide fair access to Pakistani domestic enterprises and encourage third-party investment. In the process, China will focus on helping Pakistan develop manufacturing and will also help to raise export-oriented economy. China is also encouraging its companies to increase local component in their procurement needs.

Since its inception in 2014, CPEC has completed 10 early-harvest projects with total contract amount of approximately $19 billion including 50 MW Dawood Wind Power Project costing $115 million invested by a Chinese company employing 117 Pakistanis, 100 MW Pakistan Jhimpir UEP Wind Power Phase 1 Project costing $262 million invested by a Chinese company employing 192 Pakistanis, Sachal 50 MW Wind Power Project costing $110 million invested by a Chinese company employing 162 Pakistanis and 720 MW Karot Hydro-Power Project costing $ 1.65 billion invested by a Chinese company employing 3,505 Pakistanis.

Zonergy Solar Park
HUBCO project

Zonergy 900 MW Solar Project costing $460 million invested by a Chinese company employing 3,755 Pakistanis, Port Qasim 2×660 MW Coal-fired Power Projects costing $2.85 billion invested by a Chinese company employing 532 Pakistanis, Sahiwal 1320 MW Coal-fired Power Project costing $1.8 billion invested by a Chinese company employing 3,246 Pakistanis, Laying of Optical Fiber from Khunjrab to Rawalpindi and 100 MW Three Gorges Second Wind Power Project costing $42.3 million invested by a Chinese company employing 447 Pakistanis. .

In addition 12 early-harvest projects are under construction including KKH Phase-II Havelian-Thakot costing $1.3 billion funded by Chinese government soft loan, , Karachi-Lahore Motorway Sukkur-Multan Section (392 km) costing $3,8 billion funded by Chinese government soft loan, Metro Rail Transit System on the Orange Line in Lahore costing $1.6 billion funded by Chinese government soft loan, Expressway on East Bay of Gwadar costing $143 million interest-free Chinese government loan and providing jobs to 4,222 Pakistanis.

660MW Hubco Coal Power Plant costing $2.1 billion invested by a Chinese company employing 2,525 Pakistanis, Gwadar Port Operation and Development of Free Zone costing $114.7 million interest-free loan given by Chinese government and providing 630 jobs to Pakistanis, Suki Kinari Hydro-Power Project costing $1.96 billion invested by Chinese company employing 6,323 Pakistanis, 2×330MW Mine Mouth Coal Fired Power Plant at Thar Block II costing $1.10 billion invested by a Chinese company employing 1,362 Pakistanis and Sindh and 3.8 Mta Open Cast Lignite Mine at Thar Block II, Sindh costing $845 million invested by a Chinese company employing 1,098 Pakistanis.

Gwadar International Airport
Khuzdar-Basima Road
KKH-Thakot Havelian section

Since CPEC promotes relevant upstream and downstream industries including catering, raw material processing, cargo-transportation and manufacturing therefore its 22 projects have directly provided employment opportunities to 75,000 Pakistanis. CPEC employment projections are that it will be able to create 1.2 million jobs once all projects are on ground but in the interim it is projected to create 700,000 jobs between 2015 and 2030.

CPEC has already completed 7 projects through which installed power generation capacity has increased to 3240 MW in only three years and have brought about an increase of 11% of the total power generation capacity of Pakistan. CPEC is looking forward to optimizing the energy sector of Pakistan and will ensure that Pakistan’s energy supply becomes stable and safe. It also aims at significantly reducing Gas/RFO imports to assist Pakistan in saving foreign exchange reserves.

CPEC has also focused on strengthening information connectivity without which modern development is not possible. Before 2018 Pakistan was heavily reliant on the only submarine fiber cable outlet placed in the Indian Ocean but CPEC has developed a China-Pakistan cross-border fiber cable project that has opened up an information channel benefitting trade and industry and keeping information mechanism safe and secure.

In addition, CPEC is progressing ahead with Khuzdar-Basima Road N-30(110km), up-gradation of D.I.Khan (Yarik)-Zhob, N-50Phase-I(210km), expansion and reconstruction of existing Line ML-1, Havelian Dry Port (450M. Twenty-Foot Equivalent Units), Matiari to Lahore 660k VHVDC Transmission Line Project, Kohala Hydel Project in AJK, Cacho 50 MW Wind Power Project and Western Energy (Pvt) Ltd 50 MW Wind Power Project. CPEC has also seen the establishment of Pak-China Friendship Hospital in Gwadar, Gwadar desalination plant and New Gwadar International Airport.

Of all the CPEC projects only KKH-Phase-II, Karachi-Lahore Motorway(Sukkur-Multan), Orange Line and Laying of Optical Fiber Cable used the Chinese government soft loan which were guaranteed by the government of Pakistan that cost $6 billion. According to the official statistics, Pakistan’s external debt and liabilities reached $\95 billion by October 2018 but Chinese government’s soft loans accounted for only 6.3% of Pakistan’s foreign debt. It may also be borne in mind that the repayment time of the 4 projects starts from 2021, repaying $300million-$400million annually. Moreover, all CPEC energy projects are funded by commercial loans which are borrowed from and repaid to the Chinese companies. These loans do not constitute any foreign debts on Pakistan government.

During the recent consultation between Pakistani and Chinese governments it was undertaken that according to the next economic and social development priorities and needs of the people of Pakistan, the future development and cooperation direction of CPEC will be determined through consistent consultation. Speeding up industrial cooperation and livelihood projects and gradually extending them to the western region of Pakistan will form the main focus of CPEC in future.

CPEC has also enumerated the Special Economic Zones (SEZ) such as Rashakai & Hattar SEZ in KPK, Dhabeji SEZ in Sindh, Bostan Industrial Zone in Balochistan, Punjab-China Economic Zone, M-3 in Punjab, Moqpondass, Gilgit SEZ in Northern Areas, Bhimber Industrial Zone in Northern Areas, Development of Industrial Pakron Pakistan Steel Mill Land in Port Qasim near Karachi, ICT Model Industrial Zone in Islamabad and Mohmand Marble City in FATA.

It has also been decided that both sides will establish Joint Working Groups on social development that will focus on arranging livelihood for Pakistanis as well as taking care of human resources, healthcare and small-and-medium scale livelihood projects. China will also promote agricultural cooperation to help Pakistan to improve agricultural technology, production efficiency and value added agro-based-industry. China will also support Chinese companies in fulfilling their social responsibilities and help Pakistan build more livelihood projects.

At the invitation of the Chinese leadership PM Imran Khan will pay an official visit to China from 2 to 5 November 2018 and will witness signing of a number of agreements. The visit will enhance strategic communications and will be a source to deepen cooperation and promote people-to-people exchange. The visit will certainly take CPEC to a new stage of extension and its context will be further broadened.

Pakistani PM will attend the opening ceremony of the First China International Expo in Shanghai. Pakistan has been granted the status of Guest of Honour Country and China is looking forward to extend all courtesies. Chinese have taken special care of the Pakistani Pavilion as a special gesture to foster strong relationship between both countries. The theme is ‘emerging Pakistan’ that will demonstrate achievements Pakistan has undertaken and will throw ample light on these achievements.

It is highly significant that the Chinese government is holding an international Expo and will give firms the opportunity to indulge in liberalised trade and opening globalised market to entrepreneurs. The aim is to facilitate countries of the region to engage in global trade and participate in global economic growth.

At present, more than 2800 companies from more than 130 countries have confirmed participation in Expo including top 200 companies of the world. The Expo is planned to cover an area of 270,000 square kilometers. More than 10 Pakistani companies are supposed to participate in the Business Exhibition and more than 50 Pakistani companies will participate in the fields of textile, rice, medical equipment, sportswear, supply, demand and docking activities.

Pakistani companies have been provided with a unique opportunity to participate in an international Expo of tremendous repute. It is expected that Chinese markets will welcome Pakistani products and let them enter the vast Chinese market. CPEC has opened up connections to the second largest economy of the world and it is expected that Pakistani trade and industry will take advantage of it.

Asrar Raouf is a former civil servant

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