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Wednesday, April 17, 2024

CPEC energy projects inflict no debt burden on Pakistan: China

A Chinese Foreign Ministry's spokesperson said on Wednesday that energy projects under China-Pakistan Economic Corridor (CPEC) did not incur debt burden on the Pakistani side because they are investment projects.

Zhao Lijian, spokesperson of the Chinese Foreign Ministry, during a regular press briefing said that the power projects under the China-Pakistan Economic Corridor (CPEC) framework are invested in by Chinese companies and the Pakistani government doesn’t have to pay any debt.

“I can say this with good authority that these energy projects are commercial investment where Chinese companies invested in Pakistan. They do not incur debt burdens on the Pakistani side because they are investment projects,” said Zhai Lijan in response to a question that Pakistan had requested China to reschedule its debt of around US$22 billion in energy projects which China had funded as it was struggling to repay its loans.

“We have responded to similar questions at many occasions. I don’t know how you got your specific figure,” he remarked, adding that there are various power and energy cooperation projects in CPEC.

“I worked in Pakistan for years and have a good knowledge of energy projects under the CPEC,” Zhao said. All of the energy projects are funded by commercial investment or foreign direct investment, he added

Read More: Model economic zone to be set up under CPEC

The Chinese spokesperson further said that the construction and operation of the energy projects under the CPEC are going on very well, providing steady and affordable power source and adding tax revenues and producing very tangible, economic and social benefits.

“We are confident that energy cooperation between the two countries will continue to make greater contribution to Pakistan’s national development and livelihood improvement,” he added.

Official data suggests that a total of 22 energy and power projects will be constructed under CPEC, a flagship project of the Belt and Road Initiative (BRI) launched by Chinese President Xi Jinping.

Till now nine energy and power projects have been completed, boosting the energy needs of Pakistan. These projects have contributed 5340 MW of electricity to the main grid, helping meet the country’s vital needs for industry, agriculture and domestic consumers.

Another eight energy projects are near completion and will pump in an additional 4,470 MW of electricity to the national grid. Another five projects are in the planning and implementation phase.

CPEC maintains momentum

Though the progress of CPEC, China’s most ambitious BRI project has been under scrutiny this year, it has still managed to maintain a positive momentum of development. Even during the pandemic, the construction work of the ongoing projects was not halted, there were no job cuts and no withdrawal of workforce, which helped Pakistan in countering the epidemic and stabilizing the economy.

Despite international propaganda, China Pakistan Economic Corridor (CPEC) project is proceeding at a fast pace with lot of successes and new investments.

According to official sources, China and Pakistan recently launched two mega hydroelectric power projects valuing $1.93 billion. The ML-1 railway project has also been finally agreed between the two countries and discussions are now at advanced stages.

Moreover, two memorandums of understanding (MoUs) were signed in the fields of agriculture and science and technology in 2020 between China and Pakistan. On top of that, China also offered to donate a date processing plant for Balochistan. The plant will play a vital role in creating livelihood opportunities for the local people and boosting export earnings for Pakistan.

Read More: PM Khan offers Sri Lanka to benefit from CPEC

In December 2020, China’s Embassy in Pakistan released a statement saying CPEC projects were on track in response to questions about delays. 32 projects had “achieved early harvests” over the past five years, it added.

This has significantly improved local transportation infrastructure and power supply, created over 75,000 jobs directly and contributed one to two percent of the GDP growth in Pakistan,” revealed the statement, directly hitting out at criticism from the U.S. that said Chinese projects were inflicting huge debt burdens.