Home South Asia Pakistan Sherry Rehman asks planning ministry to set its priorities right

Sherry Rehman asks planning ministry to set its priorities right

“It is not the Chinese government’s job to build stakeholder consensus on where the grant money will go and to which sector in which province. This input has to come from the federal government where the CPEC is nested,” Rehman said.

Sherry Rehman

News Desk |

Convener Special Committee on the project of China-Pakistan Economic Corridor (CPEC) Senator Sherry Rehman has expressed displeasure over the lack of coordination and capacity evident in the briefing of the Ministry of Planning, Development and Reforms.

The Pakistan Peoples Party (PPP) leader expressed her displeasure during a meeting of the special committee on the project of CPEC, held at Parliament House. “It is crucial for the ministry to set its priorities right. Placing the responsibility of implementation on the Chinese administration is unfair. The Chinese have done their part,” Rehman said.

Federal Minister for Parliamentary Affairs, Senator Azam Khan Swati asserted that CPEC is Pakistan’s lifeblood.

The PPP leader also suggested that the planning function of CPEC from the federal government required a separate secretariat and autonomous well-resourced CPEC authority, an idea which was supported by Senator Azam Khan Swati, who is a member of that committee. However, Planning Minister Khusro Bakhtiyar did not comment on this suggestion.

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Pakistan’s liability restricted to only non-private sector projects

The committee also discussed all loans and potential indebtedness of Pakistan if CPEC meets its full potential.

The Planning ministry provided details after questions were sent by the chair, and said that they estimate that in full flow $49 billion worth of projects can be realized. The government disclosed that Pakistan’s liability is restricted to only the non-private sector projects.

At the moment, the projects that fall under infrastructure only are worth $5.8 billion. The terms of lending are quite soft, at 2 to 2.25 percent, and have long repayment schedules.

The committee also discussed all loans and potential indebtedness of Pakistan if CPEC meets its full potential.

The secretary planning also disclosed that all energy projects are in IPP financing mode, and therefore not part of the government’s liabilities. Preferential Buyer’s Credit will be utilized for some items, which is a practice where the lender restricts the borrower to using country-specific suppliers, but not in any way different from certain American and Japanese lending practices.

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China sets up aid agency – CIDCA

During the meeting, it was also disclosed that China had set up an aid agency on the lines of USAID, called CIDCA, and will be providing pure grants, with no repayment, to many of the Gwadar projects as well as to the socio-economic component of CPEC, because these are aimed at poverty alleviation and development assistance in key sectors identified by the government of Pakistan.

Senator Rehman said that the ambassador of China had already explained many of the funding streams to her, and had also said that China has never called in funds it has placed in Pakistan’s treasury to assist its balance of payments. She said that the Chinese government has also been helpful in disclosing all queries made by IMF on Pakistan’s debts in order to assist Islamabad in achieving economic stability.

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Rehman objects non-transparent clutter of information

While deliberating over CPEC’s socio-economic plan and financing, Senator Rehman strongly objected to the aggregated, non-transparent clutter of information presented by the Ministry as a plan.

The government disclosed that Pakistan’s liability is restricted to only the non-private sector projects.

“This inability to coordinate between provinces and lay out their priorities is disturbing,” she said, adding that it seems that the planning ministry will barely issue pro forma letters to the provinces seeking their input, and then just put together their own plan as one that the Chinese will approve by July.

“It is not the Chinese government’s job to build stakeholder consensus on where the grant money will go and to which sector in which province. This input has to come from the federal government where the CPEC is nested,” Rehman said.

At the moment, she said, the PowerPoint and information shared by the Planning Ministry was like a model of Pakistani misgovernance. “All the money and goodwill put in by China will just be frittered away in poor allocations and nothing will show on the ground, if this level of consultation with provinces is maintained,” said Rahman.

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CPEC is Pakistan’s lifeblood

Meanwhile, it was noted that only KP province had so far been consulted, eliciting loud objections from senators from the other three provinces. Senators objected to this high-handed planning which left out on-ground priorities and grassroots concerns by the federal government.

Federal Minister for Parliamentary Affairs, Senator Azam Khan Swati asserted that CPEC is Pakistan’s lifeblood. He stressed the need for people to people connectivity and said that this was the basis of CPEC.

The committee chair directed the ministry that all information must be disaggregated and presented to the committee with timelines in two weeks. It was also decided that the focal persons from the provinces should be present in the next meeting as well.

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