Debunking myths on CPEC

Published: May 25, 2017
Prime Minister Nawaz Sharif with Chinese President Xi Jinping. PHOTO: AFP

Prime Minister Nawaz Sharif with Chinese President Xi Jinping. PHOTO: AFP

Prime Minister Nawaz Sharif with Chinese President Xi Jinping. PHOTO: AFP The writer is federal minister of planning, development and reform. He tweets at @betterpakistan

Recently, quite a few stories have appeared on the China-Pakistan Economic Corridor (CPEC) in both local and international publications. A lot of traction was gained by the cynics of CPEC by reporting factually incorrect information. Consequently, myth spurring on CPEC is on the rise. I am going to take this opportunity to debunk these myths by stating the facts.

A pointless controversy was created on the Long Term Plan (LTP) by a recent article featured in a local English-language newspaper. The report published as ‘LTP’ in that article was an initial draft by the China Development Bank (CDB) and not a part of the agreed LTP. That article basically cherry-picked information from different sources to present a distorted picture of the LTP. The fact is that the government of Pakistan has prepared its own plan after multiple stages of consultation with provinces, federal ministries and their respective technical groups. The LTP has been prepared to develop Pakistan in line with the seven pillars of Vision 2025 which are predicated on the notion of inclusive and sustainable development. The main pillars of LTP are connectivity, energy, industries and industrial parks, agricultural development and poverty alleviation, tourism, cooperation in areas concerning people’s livelihood and financial cooperation. It was shared with the Chinese authorities following approval by the cabinet.

The Chinese side has given its approval in principle, however, its formal approval is expected by the end of this month, as our Chinese counterparts were occupied by the Belt Road Forum. As soon as we get the official approval from the Chinese side, we will put the LTP on the CPEC website.

One of the biggest myths propagated on CPEC is that Pakistan might become a colony/province of China. Any historian would tell you that colonialism and imperialism are legacies of countries of the global north. China has never invaded any country nor harboured any imperial designs. Cynics point out towards rising trade deficit with China as a reason to show concern on CPEC. The reality is that China’s competitiveness in exports is universal and not idiosyncratic to Pakistan. Pakistan’s current trade deficit with China is $6.2 billion. In comparison, India’s trade deficit with China stands at $47 billion. The US trade deficit with China is $347 billion. Based on these trade deficit numbers, is it appropriate to infer that the US or India are becoming colonies/provinces of China? Certainly not. Similarly, it is ludicrous to make such claims about the Pakistan-China relationship. Both countries respect the sovereignty of each other and CPEC is based on the shared vision of both countries: Vision 2025 and OBOR.

At present, only a few thousand Chinese nationals are living in Pakistan and making a positive contribution towards our economy, the majority of them fall in the category of temporary labour migrants who will return back upon completion of the projects. In contrast, around 8 million Chinese are living in Malaysia, 400,000 in France; 600,000 in Japan; 900,000 in Canada and over 2.5 million are living in the US. Therefore, to say that Chinese are overtaking Pakistani society is nothing but a farce. Chinese nationals working in Pakistan are our national guests as they are helping us to build a developed Pakistan.

Another myth spread on CPEC is that China is dictating terms to Pakistan and the federal government is not consulting the provinces. The reality is quite the opposite. China and Pakistan work jointly in making an overall planning for a unified development of CPEC projects. In this regard, the Long Term Plan, Transport Monographic Study and respective MoUs guide the policy for CPEC.

All provinces have been consulted and invited to all meetings within Pakistan and abroad for their recommendations and review of CPEC projects. Earlier this month, the chief ministers of all four provinces under the leadership of PM Sharif attended OBOR Summit in China. On 29th December 2016, all CMs participated in the 6th JCC meeting which was held in Beijing. For institutional arrangement and development of CPEC, the National Development and Reform Commission (NDRC) of China along with the Planning, Development & Reform Ministry of Pakistan have constituted subsidiary working groups of the Joint Cooperation Committee (JCC) on planning, transport infrastructure, energy, Gwadar and industry cooperation.

Since the signing of the MoU in July 2013, six meetings of the JCC have been held. The highest officials of every provincial government are represented in JCC meetings. It is impossible to hide or misrepresent any information on CPEC from provinces. Information on ongoing and agreed CPEC projects is available on the official website of CPEC. Moreover, the planning ministry is always available to address any queries regarding CPEC. All the Chinese companies involved in CPEC projects are nominated by their government. Therefore, there is no question of favouritism on the part of the government of Pakistan.

Another myth propagated around is that Pakistan is not going to gain any economic benefits from CPEC and it is tantamount to the 2006 Free Trade agreement (FTA) with China. First of all, let me explain that an FTA works out on the basis of demand and supply of market forces. China enjoys a competitive edge in exports vis-à-vis all other economies of the world, including Pakistan, whereas CPEC is qualitatively different from an FTA. It provides necessary stimulus to kickstart the processes of industrialisation in Pakistan. Without sufficient electricity and adequate infrastructure, it is not possible to carry out industrialisation.

CPEC brings $35 billion investments in energy projects. Alongside coal, clean and renewable energy projects are part of the CPEC energy portfolio. The existing energy policy was made before the CPEC MoU was signed between China and Pakistan. Prior to CPEC, nobody was interested in making investments in our energy sector. At that crucial time, China took a lead and demonstrated to the world that Pakistan is a reliable and secure destination for foreign investments. Energy investments under CPEC will remove a major bottleneck that is in the way of realising high economic growth. It will reinforce the main grid structure, power transmission, distribution network, and improve power supply. Currently, 14 energy projects are in the implementation stage. Through CPEC projects, 10,000MW of electricity will be added to the national grid. Only 16,000MW was added to the national grid from 1947 to 2013. Moreover, energy projects under CPEC are not funded by Chinese loans instead they are undertaken in the IPP mode regulated as per NEPRA tariffs. Average cost of these projects is lower than the current cost of production of energy.

Under CPEC, new road and rail networks are to be built in all four provinces to enhance and improve connectivity within Pakistan. In addition to economic benefits of connectivity, social and regional cohesion will increase within Pakistan and in the region. Once energy and infrastructure bottlenecks are addressed, it is estimated that GDP will at least increase by more than 2 per cent from its current trend.

Similarly, one of the important components of the CPEC framework is industrial cooperation. Nine industrial zones were included in it with equal representation of all provinces. The cost of production is steadily increasing for many industries in China due to increase in wages. It is estimated that 85 million jobs will be relocated and countries in the Far East, Asia and Africa are competing for these jobs. Pakistan wants to secure a big share of the relocation of these industries and jobs. Once relocated, this will create a huge demand for labour in Pakistan and enormous employment opportunities will be available for Pakistanis.

In the current projects of CPEC, two thirds of the workforce is Pakistani and only a critical mass of labour force comes from China. This is a great opportunity for the Pakistani workforce to learn and update their skills from their Chinese counterparts. Already a boom in steel, cement and construction industries has created multiplier effects in the overall economy.

Economic benefits of CPEC are net positive for Pakistan. CPEC is a golden opportunity for Pakistan to undo the mistakes of the past and we, as a nation, cannot afford to be complacent about it.

Published in The Express Tribune, May 25th, 2017.

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Reader Comments (18)

  • DevilHunterX
    May 25, 2017 - 10:34AM

    The Chinese will be IMPORTING their own labour to ensure completion of the CPEC projects, as they have found that the Pakistani labour force are of poor quality.

    Infact, Pakistani companies will be willing to hire the Chinese labour as they are better trained and highly-skilled.Recommend

  • Toti Calling
    May 25, 2017 - 10:42AM

    China-Pakistan Economic Corridor will be beneficial for Pakistan in more was than one ways, although it benefits China more. China has pledged investment before in Pakistan that has not proved as large as promised. This time, Pakistani officials say that nothing, not even the treacherous topography of the border with China, will be allowed to get in the way. The fact that india and even USA do not like the project, shows that they are afraid of China/Pakistan friendship and its economic implications. Recommend

  • Mike
    May 25, 2017 - 10:51AM

    Lol, you start with a big joke: “China has never invaded any country nor harboured any imperial designs.”

    By the way, Ever heard of Tibet or Xinjiang or Taiwan or South China Sea?Recommend

  • Hussain
    May 25, 2017 - 11:17AM

    We Pakistanis have a tendency to over think and over analyze everything.

    The reality is that China’s competitiveness in exports is universal and not idiosyncratic to Pakistan. Pakistan’s current trade deficit with China is $6.2 billion. In comparison, India’s trade deficit with China stands at $47 billion. The US trade deficit with China is $347 billion

    In contrast, around 8 million Chinese are living in Malaysia, 400,000 in France; 600,000 in Japan; 900,000 in Canada and over 2.5 million are living in the US

    This is a given fact that the unlike all those cynical remarks; Pakistan will not become a Chinese colony, Chinese will not be in every second house in Pakistan!!!Recommend

  • Mujtaba
    May 25, 2017 - 11:19AM

    I agree with the writer. Developed Countries like Singapore, Malaysia and Dubai have more foreign nationals then the local population. If a foreign national comes and works for Pakistan it must be taken as positive sign.Recommend

  • Sexton
    May 25, 2017 - 11:22AM

    I really believe that CPEC is a big opportunity for Pakistan.Recommend

  • Faisal Butt
    May 25, 2017 - 12:11PM

    Respected Sir,

    Thank you for clarifying the confusion created by the LTP released recently. It is my humble suggestion that your counter narrative would hold more weight-age if the government releases the agreed LTP as mentioned in your article. Recommend

  • Shugufta
    May 25, 2017 - 12:55PM

    This article was very valuable in clarifying misconceptions. Pak-China friendship will prevail over the attempts of the enemies to derail it. More such articles should keep on coming. PAK-CHEEN ZINDABADRecommend

  • Laila Badshah
    May 25, 2017 - 12:55PM

    Ahsan Iqbal really helped debunk CPEC myths. I believe CPEC will bring prosperity to the region. It is perhaps the best thing that happened to Pakistan in a long while. Minister and others should keep addressing the criticism on regular basis to avoid misconceptions. Recommend

  • Raja Mehtab
    May 25, 2017 - 2:34PM

    Great writing piece with full of facts & figure. Ministers wrote everything that is very much important to share. It is slaps on the faces of those haters who always trying to propagate negatively about CPEC. In sha Allah very soon every Pakistani will see its result.
    Salute you to @Ihsan iqbal Sb for his outstanding day & night efforts. Thumb up man…!!!Recommend

  • Adnan Khan
    May 25, 2017 - 2:39PM

    Welldone Ahsan Iqbal Sir for busting the CPEC myths bubble. We hope that you will routinly comeup with new articles and updates about The Game Changer CPEC. I wish that you should seriously consider following projects in CPEC Longterm plan.

    Petro Chemical City Gawdar
    Oil Refinery and Oil City in Pasni
    Mega Ship Building and Breaking Yard Gadani or Gawdar
    Development of 4 Large Scale Manufacturing Zones in all four provinces.
    Quetta- Multan 2 lane Highway having tunnel at Fort Manro. It will third vertical connectivity after Peshawar Lahore and Gawdar Karachi.
    Peshawar-Jalalabad Railway Line.
    Peshawar Kabul Motorway
    Exploring the Gem & Marble Sector
    Pakistan-Tajikistan Road through Dorah Pass.(Optional)
    Mechanism to develop and get maximum benefits from Saindak and Rikodek and >Waziristan Gold Projects. Believe me they could be our second CPEC.
    Katchi Canal a key agriculture prosperity economic project for Baluchistan
    Chashma Canal for KP agriculture revolution
    Make 5 years plans to Boost GDP of KP and Baluchistan.Its really important.


  • Advocate Nisar Ahmed
    May 25, 2017 - 4:53PM

    Glad to read such an informative piece of writing. It is really very unfortunate and sad that some politicians are trying to politicise this game changer project. If they have conscience and they really love Pakistan, they should play a positive role in this project.Recommend

  • Rex Minor
    May 25, 2017 - 6:10PM

    By the way, Ever heard of Tibet or Xinjiang or Taiwan or South China Sea?

    All of them are the integral part of China which is now being extnded to the arbian sea. The chnese do not invade but simply extend their writ. se domintionThose who invade China over time become chinese too. This frightens the Indian leaders who have no defense gainst the chinese.

    Rex MinorRecommend

  • Bhushan Dwivedi
    May 25, 2017 - 11:33PM

    Numbers are always missing in every para so how to believe in half cooked article. This way he is making every person fool. nothing else.Recommend

  • Mohammad Cheng
    May 26, 2017 - 9:00AM

    Do not believe anything until it is officially denied.Recommend

  • Xman
    May 26, 2017 - 12:58PM

    Chinese are neighbours, and have stakes in the region. Hence it’s not in their interest to stir things up in Pakistan. Unlike the colonists, living far off in their comfort, whose only interest is to keep other parts of the world busy in conflict, so that it stays off their front doors, and they can use the chaos to steal natural resources for their benefit, while enjoying their consumerism fuelled “way of life”. Recommend

  • Parvez
    May 26, 2017 - 2:46PM

    Firstly, China, like any good business partner, works by the book ( contracts in this case ). Has this government thought ahead on how will we meet our financial commitments in the years to come, seeing that our debt burden is growing exponentially …… or is the plan ‘ we’ll cross that bridge when it comes ‘ Recommend

  • Shazia Bangash
    May 26, 2017 - 4:03PM

    @Mike: These have been part of China for a long time. Next you will allege that Native Americans of New Mexico were invaded by the Americans!Recommend

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