CPEC projects worth $28bn com­pleted in 4 yrs: Min­istry

Gulf Times Business - - BUSINESS -

Pak­istan has $28bn of projects un­der China-Pak­istan Eco­nomic Cor­ri­dor (CPEC) com­pleted over the past four years, the min­istry of plan­ning said yes­ter­day.

The plan­ning min­istry said at least 22 CPEC projects have been com­pleted since 2014.

“CPEC is not im­pos­ing any im­me­di­ate bur­den with re­spect to loans re­pay­ment and en­ergy sec­tor out­flows (which) will start from 2021 and spread over 20 to 25 years with a max­i­mum in 2024 and 2025,” the min­istry said in a state­ment.

“The re­sul­tant ben­e­fits of these in­vest­ments to the Pak­istan econ­omy would far out­weigh these out­flows.”

The plan­ning min­istry said CPEC has pro­vided enor­mous op­por­tu­ni­ties for the coun­try to grow eco­nom­i­cally.

It is an en­gine for eco­nomic growth and is ex­pected to in­crease GDP growth by 2% to 3%.

The min­istry said CPEC is a flag­ship and most ac­tive project of Belt and Road Ini­tia­tive and “could not be com­pared with Chi­nese over­seas in­vest­ment in Sri Lanka or Malaysia as frame­works and fi­nan­cial modes of CPEC are al­to­gether dif­fer­ent in na­ture”.

“CPEC fi­nances are di­vided in govern­ment-to-govern­ment loans, in­vest­ment and grants,” it added.

In­fra­struc­ture sec­tor is be­ing devel­oped through in­ter­est free or govern­ment con­ces­sional loans.

Gwadar port is grant-based or in­vest­ment which means the govern­ment does not have to pay back the in­vested amount for the de­vel­op­ment of the port.

En­ergy projects are be­ing ex­e­cuted un­der in­de­pen­dent power pro­duc­ers mode and fi­nances are mainly taken by the pri­vate com­pa­nies from China De­vel­op­ment Bank and China Exim Bank against their own bal­ance sheets.

“There­fore, any debt would be borne by the Chi­nese in­vestors in­stead of any obli­ga­tion on part of the Pak­istani govern­ment,” the min­istry of plan­ning said.

“Pak­istan has opted for Chi­nese in­vest­ment un­der the China-Pak­istan Eco­nomic Cor­ri­dor due to the favour- able fi­nanc­ing ar­range­ments.” China stepped for­ward to sup­port de­vel­op­ment at a time when for­eign in­vest­ment had dried up, and eco­nomic ac­tiv­i­ties were be­ing crip­pled by en­ergy short­ages and in­fra­struc­ture gaps in the coun­try.

CPEC has fa­cil­i­tated in over­com­ing cru­cial en­ergy, trans­port in­fra­struc­ture and sup­ply chain bot­tle­necks.

Un­der CPEC, de­vel­op­ment of Gwadar would en­sure strength­en­ing of mar­itime sec­tor par­tic­u­larly the coastal tourism and lo­cal fish­ery in­dus­try “thereby ben­e­fit­ing the lo­cal com­mu­ni­ties”.

“Pak­istan has re­peat­edly stated that it is fully com­mit­ted to the China-Pak­istan Eco­nomic Cor­ri­dor, which en­joys com­plete con­sen­sus among all in­sti­tu­tions and po­lit­i­cal forces,” the plan­ning min­istry said.

“It is a key to the fu­ture of Pak­istan’s so­cioe­co­nomic de­vel­op­ment. Within the broad pa­ram­e­ters of the al­ready ap­proved CPEC frame­work, the present govern­ment, with mu­tual con­sul­ta­tion of govern­ment of China is broad­en­ing the base and ex­pe­dit­ing pace of the China-Pak­istan Eco­nomic Cor­ri­dor.”

Govern­ment is also de­vel­op­ing a mech­a­nism to in­clude third party par­tic­i­pa­tion in CPEC.

“So­cioe­co­nomic de­vel­op­ment and poverty alle­vi­a­tion are be­ing in­cluded in CPEC and a sep­a­rate work­ing group is be­ing es­tab­lished to fast-track the di­men­sion of the mega project,” the plan­ning min­istry said.

“Gwadar con­tin­ues as pri­ori­tised and be­ing devel­oped as stand­alone project and a trans­ship­ment hub based on blue econ­omy prin­ci­ples.

In­dus­tri­al­i­sa­tion un­der the Chi­naPak­istan Eco­nomic Cor­ri­dor has al­ready been fast-tracked and four SEZs (spe­cial eco­nomic zones) would hit the ground soon.”

A con­tainer is loaded on to the first Chi­nese ship to de­part af­ter the in­au­gu­ra­tion of the China-Pak­istan Eco­nomic Cor­ri­dor port in Gwadar. Un­der CPEC, de­vel­op­ment of Gwadar would strengthen mar­itime sec­tor par­tic­u­larly the coastal tourism and lo­cal fish­eries in­dus­try thereby ben­e­fit­ing the lo­cal com­mu­ni­ties.

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