Myrah Qadeer Khan |
Quite frequently these days’ people talk of research, both in academic institutions and outside. Several research studies are undertaken and accomplished years after years but in most cases very little attention is paid to an important dimension. Much of the research in social sciences contains endless word-spinning and too many quotations thus a great deal of research is futile it may be noted that significance of research lies in quality not quantity.
Pakistan has great geopolitical importance in the region. The most vociferous depiction of this reality came in shape of China Pakistan Economic Corridor.The corridor is a $46 billion project which will provide the shortest trade routes for Chinese goods to the markets of Gulf and African regions via Gwadar port of Pakistan.The project is being seen as game changer of the region amid the challenges faced by it.CPEC is seen as a game changer in ways like bringing economic integration in Asia thus leading to stability in the region.It may change Gawadar port into an international trading port moreover China may seek control over markets via one Road,One Belt.
Although there have been attempts to address some of these barriers but the significant problem remains. This research article provides an insight into CPEC- a game changer, mega project. Concerns regarding its limitations are expressed as well.Pakistan enjoys a location of strategic importance due to which it plays an important role in international politics and transit economy.Pakistan shares a 400 km long border with China in the North.In the West is Afghanistan,in the east is India Pakistan is gaining more importance as a major ally of China due to China’s emergence as an economic power. Pakistan’s friendship with China has a long history.The long Karakorum Highway passing through tortuous valleys and passes in the Himalayas stands as a living example of the long and time-tested friendship between the two countries.
Treading on the corridor of development
The world powers are viewing the development of CPEC with keen interest and are trying to figure out their own interests out of this land mark connectivity between East Asia and South Asia.The Think Tanks in all major capitals are deliberating and writing on this important subject with focus.
A framework of regional connectivity, CPEC- China Pakistan Economic Corridor; The project having potential for benefitting the entire region and not just Pakistan and China. Other countries like Iran, Afghanistan and Central Asian Republics can also benefit from the fruits of this economic corridor if they seize the opportunity and take steps for getting maximum benefits.
The Chinese attach very high hopes from this project and Pakistan being a time tested friend has to prove itself worthy of the trust.
Since April 2015, the term which has probably received far greater attraction in the print and electronic media, more than any other, is “game changer”. The “game changer”, which government officials, military generals, diplomats, journalists and a host of other observers refer to, is the $46 billion China-Pakistan Economic Corridor (CPEC) project, a highway which is to run from Kashgar in China to Gwadar in Baluchistan, on the edge of the Persian Gulf,in Pakistan.
Read more:Making a success story out of CPEC: Certain, probable, or doubtful?
The Chinese attach very high hopes from this project and Pakistan being a time tested friend has to prove itself worthy of the trust. The Chinese Foreign Minister Mr. Wang Yi said “If One Belt,One Road is like a symphony involving and benefiting every country,then construction of Chinese-Pakistan Economic Corridor is the sweet melody of the symphony first movement.”
This Economic Corridor has been baptized as a “game changer” and even a “fate changer” by an overly enthusiastic Pakistani press and government; with some analysts even saying that this $46 billion “unprecedented” Chinese investment over the next decade-and-a-half will make Pakistan the next Asian Tiger. There has been an effusive “thank you” by government officials and by analysts and journalists made to China for agreeing to build the Corridor, with important Pakistani commentators going so far as saying that this measure “speaks volumes about the commitment of the Chinese leadership towards Pakistan and its 180 million people”, especially when contrasted to the (only) $5 billion investment made by the U.S. in the period 2009-15.
China is one of the biggest and fastest growing economies, and Pakistan enjoys an exceptional geographic location, a growing economy and a promising land for investments.
The Chinese are too savvy to invest in such a project without counting the numerous economic, geopolitical and geostrategic returns to their investment and agenda of regional economic connectivity through their One Belt One Road initiative.
CPEC is such a huge project that it can benefit not only one or two countries, but whoever wishes to become part of the list of investors. CPEC can improve the quality of its projects, the processes and network involved in its establishment far more with greater level of investment from different avenues. On the basis of mutual benefit and the theory of win-win, Great Britain is likely to extend its interest in the CPEC which will serve to improve the global image of Pakistan and will become a game changer for this region as other developed and developing countries follow suit.
Read more:Why China wants to ‘speed up’ CPEC’s construction?
The Chinese are too savvy to invest in such a project without counting the numerous economic, geopolitical and geostrategic returns to their investment and agenda of regional economic connectivity through their One Belt One Road initiative.The Nawaz Sharif government too can gain much with economic development linked to the corridor taking off,offering far greater prospects for re-election in 2018 when some projects come on stream.The Pakistani military is an obvious beneficiary with its role in security and with its stakes in numerous infrastructure and economic projects around the corridor. Perhaps some underdeveloped regions in Baluchistan and Khyber Pakhtunkhwa will also benefit.
There are many unanswered concerns as well.For Pakistan,will U.S. and Saudi imperialism now be replaced by the Chinese variety?What if the Chinese interests shift to other regions and projects, and CPEC abandoned like some African mining site? Would India attempt to sabotage Pakistan’s future development, as the Pakistani Army Chief has hinted? Does CPEC come at a cost to the bonhomie between India and China? Or, will this be the great “destiny changer” for Pakistan at the further loss of its sovereignty, given the absence of any indigenous economic strategy other than one corridor? There is bound to be an ancient Chinese proverb warning about all eggs in one basket.
Read more:The differing futures of Pakistan and China. Does Beijing get a…
The steady pace at which the CPEC has developed is impressive and it has made Pakistan more eye-catching with regard to foreign investment.Developed countries are keeping a close eye on China-Pakistan Economic Corridor (CPEC) and showing great interest in joining this mega project.The Royal United Services Institute (RUSI) will hold a conference in Pakistan in May 2017,to discuss the possibilities of collaboration on CPEC projects. RUSI is Britain’s oldest think tank on defense and security studies. It conducted a project on CPEC and its preliminary findings would be discussed in the RUSI conference with Chinese and Pakistani representative.It would be interesting to see the results of the RUSI conference as it will lay the foundations of UK’s official involvement in the CPEC.
Pakistan Minister for Planning, Development and Reforms, Ahsan Iqbal has applauded UK’s interest in CPEC and also informed that there are many other countries that are keen to join CPEC.
It is a privilege for Pakistan to work under CPEC as it is the first flagship project under China’s Belt and Road Initiative. CPEC is playing a vital role in enhancing the image of Pakistan in the global arena and the outlook of Pakistan’s economy and international standing is changing swiftly.CPEC is a big vote of confidence for Pakistan’s economy and it can be hoped that CPEC will bring in more foreign investments in Pakistan.On the other hand,for Great Britain,it would likely be a high return opportunity post Brexit and its search for good trade opportunities in nontraditional and unusual ventures.Increased cooperation with Pakistan and China under CPEC can be really fruitful for Great Britain.
Economic policies in Pakistan have never been smooth. It can be said that the policies have never been made with long objectives in view. Most of the policies are made for short term objectives only and these are also tainted with political purposes. Pakistan has the potential for emerging is a major economic player in the region.
The CPEC infrastructure certainly boosts Pakistan’s tourism industry. In addition, the completion of the CPEC project would play a significant role in inter-provincial integration. It would also bring unprecedented economic rewards for the agriculture sector of Pakistan. The cooperation in the agriculture sector would help in transferring of technology pertaining to agro-chemicals, pesticides, seeds and fertilizers, which are imperative for increasing the yield of the crops in Pakistan.To conclude, successful implementation of CPEC will change the economic outlook and financial conditions of the people of Baluchistan and KP. Thus,it is imperative that Islamabad intelligently monitors and thwarts challenges to CPEC,which offers many opportunities for country.
Read more:CPEC: Is the sovereignty of Pakistan being compromised?
Economic policies in Pakistan have never been smooth. It can be said that the policies have never been made with long objectives in view.Most of the policies are made for short term objectives only and these are also tainted with political purposes. Pakistan has the potential for emerging is a major economic player in the region.Even smaller countries having less natural resources and skilled human resources have made significant progress. A classic example for comparison is that of Bangladesh. Once considered as a burden on the national economy, the people of former East Pakistan have made economic progress. According to a research done by University of Manchester in United Kingdom, Human Development Index of Bangladeshis living in UK is better as compared to Pakistanis and their household income is also improving considerably.The currency of Bangladesh is also stronger than Pakistan which has shed considerable value against the US dollar in last 8 years.
The Pakistani Finance Minister stated that the corridor would change the destiny not just of Pakistan, but of three billion people in the region. Such has been the hype over the projected road.
CPEC is also suffering because of Government Policies and lack of trust between provinces and the federal government. The provinces are claiming that the way the CPEC is designed, only Punjab would gain and the rest of the three provinces would get nothing. Because of this trust deficit a lot of propaganda has also started against the CPEC. There is an expectation, well-founded no doubt, that such projects will give rise to jobs (particularly unskilled ones), will allow local businesses to benefit, and might open the way to development.
Read more:CPEC: Pakistan’s economic development or China’s Imperialism
The Pakistani Finance Minister stated that the corridor would change the destiny not just of Pakistan, but of three billion people in the region. Such has been the hype over the projected road. Clearly,all provincial governments (with their own particular ethnic and regional alliances),political parties and interests realize the huge externalities which are expected to accrue to the infrastructure and road building along the corridor,and hence their interest in acquiring political and economic returns from it.
Recognizing the growing energy needs of Pakistan, and to overcome the existing deficits,CPEC has allocated a major proportion of its funds to energy generation and transmission. Pakistan’s current energy generating capacity is 24,830 MW, though the country currently faces energy shortfalls of over 4,500MW on a regular basis with routine power cuts of up to 5 hours per day, which has shed an estimated 2–2.5% off its annual GDP. Energy generation will be a major focus of the CPEC project, with approximately $33 billion expected to be invested in this sector.As part of the “Early Harvest” scheme of the CPEC,an estimated 10,400 MW of electricity are slated for generation by March 2018 as part of CPEC’s “Early Harvest” projects.
The energy projects under CPEC will be constructed by private Independent Power Producers, rather than by the governments of either China or Pakistan.The Exim Bank of China will finance these private investments at 5–6% interest rates,while the government of Pakistan will be contractually obliged to purchase electricity from those firms at pre-negotiated rates.
Undoubtedly, an investment of the proposed scale and a project completed within a limited time frame is welcome, but a cautionary note is in order: mega projects of this scale also entail risks of equal magnitude.
There is an expectation, well-founded no doubt,that such projects will give rise to jobs (particularly unskilled ones),will allow local businesses to benefit, and might open the way to development.Fortunately, some skeptical commentators,the very few who dare to voice caution amidst the euphoric din still ringing through Pakistan and having to contend with allegations that they are unpatriotic and anti-national,have questioned whether the Chinese investment represents Chinese strategic and economic interests solely focused on what will benefit China,much more than it does economic investment which might be of some benefit to Pakistan in the end.
Read more:Will CPEC negatively affect the social culture of Pakistan?
Undoubtedly,an investment of the proposed scale and a project completed within a limited time frame is welcome,but a cautionary note is in order: mega projects of this scale also entail risks of equal magnitude.Therefore,it is vital to meticulously address all possible impediments in their implementation through careful planning in order to preclude any possibility of disruption in the smooth execution of projects of this nature.
Read more: CPEC will not stir up Indo-Pak Trouble, says China
The Pakistan government is projecting the China-Pakistan Economic Corridor (CPEC) project as a panacea to all its problems, one which will result in unprecedented nationwide prosperity. It is still not clear how much of the plan will be earnestly followed up and how much is there simply to evince Pakistan’s interest. The project surrounded by all optimism yet cannot be totally perceived without apprehensions. It seems that the plan seeks to build on a market presence already established about Chinese enterprises.The entry of Chinese firms will not be limited to the CPEC framework alone considering the recent acquisition of the Pakistani stock exchange.It seems as if CPEC is the opening of the door.Once the door is open it is difficult to forecast.
The views expressed in this article are the author’s own and do not necessarily reflect Global Village Space’s editorial policy.