A free Chinese takeaway

Rumbles of discontent around the China-Pakistan Economic Corridor (CPEC) continue. This is the largest and most complex project that any government of Pakistan has ever undertaken either alone or in partnership. It has many elements that move at different speeds and there are numerous frictions along the way. Obviously, China is the prime mover and as such wants to make the most of its investment and maximise the profits of its own (Chinese) companies that are part of the broader One Belt One Road (OBOR) project. For its part, cash-strapped Pakistan will do all it can to minimise negative impacts particularly financial and one such easement has attracted the anger of senators.

On Friday, January 26^th senators spoke on a call-attention notice asking why an exemption had been given to duties and taxes for M/s China State Construction Engineering Corporation Limited that is building the Sukkur-Multan section of the Karachi-Peshawar motorway. The exemptions apply to imported goods and construction materials.

The honourable senators got little by way of a clear answer to any of their questions. The concern was that the exemptions being granted to the Chinese company would negatively affect local industries. They wondered why it was that exemptions were granted to a single company rather than across the board, and that anyway 37 per cent of the project was already completed. The sum involved is considerable — Rs10.98 billion — and it is not difficult to assume that a precedent has been set with a potential loss of revenue to this and later governments that is nothing short of astronomical.

Answers were evasive and deflective. The minister of state for finance said that the ministry of communications had submitted a summary to the Economic Coordination Committee (ECC) which considered and approved it — thus questions must be directed to the ECC. How convenient. The minister for planning and development claimed that the federal cabinet had endorsed the ECC decision and that “every detail should not be scandalised”. With respect Mr minister, this is the asking of legitimate questions, the scandal is that there are no answers. We can expect more of the same scandalous opacity into a far future.

Published in The Express Tribune, January 28^th, 2018.

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