Blame it on political chaos, corruption or a deteriorating law and order situation in Pakistan. Whatever the cause, Chinese enthusiasm for the multi-billion dollar China-Pakistan Economic Corridor (CPEC) is waning and Beijing has taken several road, mass-transit and industrial zone projects off the table, either temporarily or permanently.
Two road projects that have been put on hold are in troubled Baluchistan province: a 210-km Dera Ismail Khan-Zhob artery and a 110-km Khuzdar-Basima route. The unfinished 136km Karakorum Highway (KKH) from Raikot to Thakot has similarly been abandoned, with people in Gilgit-Baltistan taking to the streets in protest.
It was revealed on the GEO News TV channel last week that China has also delayed funding for the Karachi Circular Railway and some industrial zones projects, and has suggested Pakistan take commercial loans from Chinese investment banks if it wants to see early completion of the projects.
Pakistani press reports have quoted a “senior government official” as stating Islamabad had hoped to get projects worth one trillion rupees (US$9.46 billion) finalized during a Joint Working Group (JWG) meeting with the Chinese on November 20 but that Chinese officials had, at that session, tabled “new guidelines” with regard to new funding mechanisms to be used beyond the earliest CPEC projects. They had, according to the Pakistani official, also suggested a reevaluation of CPEC, with only the highest-priority projects being pursued and those less likely to generate economic activity sidelined to avoid “overstretching” the CEPC portfolio.
Pakistan’s authorities have shrugged these reports off as a “fragment of imagination.” However, Asia Times has been able to verify that projects are being abandoned. On a visit to a free industrial zone project at Hattar, in Khyber Pakhtunkhwa’s Haripur district, for example, we learned that China had backed out of an earlier commitment to developing it under the CPEC umbrella.
“The Pakistani decision to let almost all the plots in the free zone surrounding Gwadar port to Saudi and Qatari investors without taking China into confidence created mistrust”
Muhammad Ishaq, a leading industrialist and former director on the Khyber Pakhtunkhwa Board of Investment & Trade (KPBOIT) said the government had in fact tricked investors and sold them plots of land by alluding to CPEC funding for power facilities on the site.
Cracks in the CPEC vision started to appear last month when Pakistani authorities announced the exclusion from the CPEC framework of the US$14-billion Diamer-Basha Dam in Kashmir. Speaking to the press, the chairman of Pakistan’s Water and Power Development Authority (WAPDA), Muzammil Hussain, said that “Chinese conditions for financing the Diamer-Bhasha Dam were not doable and against our interests.”
According to Ishaq, the growing wedge between the countries may be partly geo-political. “[An issue] which created mistrust… was the Pakistani decision to let almost all the plots in the free zone surrounding Gwadar port to Saudi and Qatari investors without taking China into confidence,” he said, adding that the government had canceled lets made to local entrepreneurs in order to accommodate Arab interest.
The security issue in volatile Baluchistan is likely a more pressing concern for Chinese officials, however. Separatist forces and religious zealots have made Baluchistan a valley of death. In only the last two months, 64 people – including senior police officers and laborers working on CPEC projects – have been mercilessly killed in various incidents which the authorities acknowledge were carried out by parties bent on sabotaging CPEC.
good news
No need for a comment
It is typical careful chinese management of risks. The projects that has been completed are low hanging fruit that are already generating income amd economic development activity for Pakistan. The debt burden will also be reduced as Pakistan increasingly can finance the additional projects through the additional income generated. It is timely to review the progress so far and adjust proposed plans to suit the evolving economic structure.
Just compare the real progress made in Pakistan while US has little to show for the trillion dollars it spent in Afghanistan to create viable alternatives to the opium trade..
Pakistan has to learn that it can’t have a Chinese husband, whilst it still has its American lover.
Time to choose, industry or CIA madrasa’s and bribes?
It is good that China have a rethink as it can afford to lose to much money in the Pakistani projects. Some losses will be OK with a all-weather friend who happens to be the only US ally in the Indian subcontinent.
Now China is focusing in Myanmar. I hope China does not make a mess over there as US did in Taliban era Afganistan and Pakistan. If China has a good will it has the capacity to solve Myanmar Rohyanga issue. Myanmar will be a testing ground for Chinas "Peace", role in Asia. Lets hope for the best.
China is very smart. China knows that Mysnmar is more important geopolitically to China n more trust worthy than Bangladesh or Pakistan or both n China will be very nice n very careful not to offend the Myanmar people n the country esp. at this time n era regardless of what or who ! Myanmar people call China , our Sew Myo Pauk Phaw Gyi, an endearing term to China which China loves n enjoys it!
Pakistan is a state not trustable to no one even its own people where Four province people, culture, thinking and languages are different. When a province do not allow Pakistan to use its land without their consents its their right such as Balochistan had never been a part of Pakistan. Why they should allow Pakistan to make CPEC where clean water, electricity and basic education is not available. Pakistan beside terrorise Baloch and kill them to gain its benifits. The world is on 21 Centuary you can not do certain project without people permission. Pakistan already looting SANDAK and SUIGAS from Balochistan.
USA is not Pakistan’s lover they are stuck in Afghanistan and need Pakistan, Pakistan has chosen all weather friend China, these may be teething issues nothing more !
I fully agree with you and also add these are just school building that will be built in months these mega projects which includes Industrial zone, Residential zones, Railway networks, Hight networks, Power Plants. So those who criticising its wrap are just living in fools lands in coming few years the progress of OBOR/CPEC will visible to public and thus more support will come from Political parties as well Public 🙂
In the near future China soon occupied the whole Pakistan… Then they treat the paki just like tibtetians peoples
BRI will mostly be 2 steps forward and 1 back.. There will be many challenges and outright sabotages… But overall, despite the monumental task and risks, Beijing still consider it a better bet than piling up on more printed American IOU’s.
Shift these investments here to Bangladesh
Given the humogous ambition to build various OBOR infrastructures, it would be better for both the Pakistanis and Chinese that Pakistania diversify and raise their concessionary loans from IMF, World bank and ADB.
That is the fact,Pakistan still greasing the hands with American dollars,so for Chinese can not turn blind eye.
China is tightening the noose around Pakistan’s neck. A time will come when Pakistan would have to pledge it’s army to secure loans.
Then they have a billion people problem. Good for them. The MINGS withdraw from Cheng Ho`s project because of its size. Then they went into seclusion.
When you make a deal with the devil…..or rather…..when two devils make a deal….totalitarian corrupt Islamic Pakistan and totalitarian corrupt Communist China.
False perceptions.
American empire finhed at Jerusalem.