Investors rattled by minister’s CPEC views

APakistani official’s critical comments about projects funded by China to the tune of billions of dollars rattled investors and sparked worries yesterday of a souring in ties, a day after Beijing’s top government diplomat concluded a visit.

Abdul Razzak Dawood, the Pakistani cabinet member for commerce, industry and investment, suggested that all projects in the $57-billion (Dh209 billion) China-Pakistan Economic Corridor programme (CPEC) could be eligible for suspension in a review to be conducted this week under the orders of new Prime Minister Imran Khan.

“I think we should put everything on hold for a year, so we can get our act together,” Dawood told the Financial Times in an interview. “Perhaps we can stretch CPEC out over another five years or so.”

He added that he thought China had been granted too-favourable terms in many projects by the former government of Nawaz Sharif. “Chinese companies received tax breaks, many breaks and have an undue advantage in Pakistan; this is one of the things we’re looking at because it’s not fair that Pakistan companies should be disadvantaged,” Dawood said.

Pakistani markets fell in early trading yesterday, with the benchmark KSE 100 index down 477.38 just after midday at 40,374 points, before recovering to close at 40,684, still down 0.4 per cent. Dawood’s comments were “mind-boggling” and rare public criticism of China, said Mohammad Zubair, privatisation minister in the previous government.