There is no doubt that the $46billion China Pakistan Economic Corridor will have positive effect on the country’ economy. Be it the power projects, the roads network or the transmission lines, all of them will add tremendously to the economy of Pakistan. The completion of China Pakistan Economic Corridor projects when completed will end the long persisting issue of power shortage from the country.
The major hurdle in the way of China Pakistan Economic Corridor was the opposition by political parties. Pakistan Tehreek-e-Insaf, Pakistan People’s Party, Awami National Party and Balochistan National Party-Mengal had all expressed serious concerns regarding the project. The major concerns of these parties were regarding the share their respective provinces will get from the projects. After months of cross accusations between these parties and the government the matter it appears has finally been settled. Federal Minister for Planning Ahsan Iqbal in a statement also confirmed this and in a statement said that the government has achieved total consensus among provinces as to the best way forward on the China-Pakistan Economic Corridor. In a briefing to the 20th meeting of the parliamentary committee on CPEC, he apprised the committee of the recently-concluded 6th meeting of the Joint Cooperation Committee (JCC) in Beijing. He told the committee that the Bhasha Dam would be part of CPEC, and that 11,000MW of electricity would be added to the national grid by 2018. He termed the development the biggest investment in energy in the history of Pakistan. The minister said Thar coal would be used to generate electricity for the next ‘400 years’ (the veracity of the claim remains to be ascertained) and that two transmission lines being installed between Matiari-Lahore and Matiari-Faisalabad would transmit electricity from the south to the national grid, benefiting all parts of Pakistan. He added that there was agreement on prioritizing the construction of the western route of CPEC as well as the upgradation and construction of the Karachi-Torkham railway line at a cost of $8 billion. This will be the biggest railway modernization project in the history of Pakistan, he said. However one major concern is that the government seems to be putting all its egg in one basket. An economic corridor (primarily a road network) and power projects alone cannot ensure progress and prosperity in the country. The three chambers of commerce and industry comprising Gujrat, Gujranwala and Sialkot cities, have expressed their grave concern over China’s reported plan of establishing industrial units and warehouses along the route of the China Pakistan Economic Corridor. The leadership of these three chambers has also urged the federal government to take the business community of these industrial cities in confidence about the nature of China’s planned industrial units in the country, warning of its adverse effect on local industry and apprehending that such a scenario might turn Pakistan into a purely consumer market, further weakening its own manufacturing sector.
Then there is the recent warning by IMF in which it said that Chinese investments in Pakistan have the potential to lift the economy’s potential output, but the repayment obligations that come with this investment will be serious. The country’s is plagued with numerous economic challenges from shrinking exports to rising debt, hoping that CPEC will miraculously become a remedy to all economic ills is something that will harm us in the long run.
There seems to be no end to rising debt and shrinking exports.
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