Cranes tower above the first, 602-meter-long quay at the Gwadar port in Baluchistan on the southernmost tip of Pakistan last October. This is the site of what is supposed to become a giant trade port as part of China's 'New Silk Roads'. Photo: AFP/ DPA
Gwadar port in Balochistan on the southernmost tip of Pakistan. Just as they complain about gas distribution, irate residents of the underdeveloped province complain that they are not receiving an appropriate share of the benefits from the Chinese-backed port project. In both cases they see evidence of the center's traditional marginalization of their province. Photo: AFP / DPA

Pakistan has attempted to get Saudi Arabia to invest in the China-Pakistan Economic Corridor (CPEC) but it is too early to confirm that its efforts will bear fruit. Neither Beijing or Riyadh have clarified whether Saudi Arabia will be involved in the multi-billion-dollar scheme.

Last week, after Pakistani Prime Minister Imran Khan’s maiden visit to Riyadh, Information Minister Fawad Chaudhry said the Saudis were invited to join CPEC as a third strategic partner. “So Saudi Arabia is going to be the third partner in CPEC and huge Saudi investments will come to Pakistan,” he said. Chaudhry said a high-level Saudi delegation would visit Islamabad next month to finalize Saudi investment in the CPEC projects.

Later, Adviser to the Prime Minister Abdul Razak Dawood said Saudi investment in the huge Oil City project in Gwadar would be $22 billion. That sum is much higher than the figure quoted by Usman Dar, central deputy secretary-general of the ruling Pakistan Tehreek-e-Insaf (PTI), who claimed in a tweet that the two countries had struck a $10-billion deal.

Last month, Dawood was quoted by the Financial Times as saying that the Pakistani government would revisit some CPEC agreements. His remarks caused an uproar, but after Dawood claimed the paper had quoted him out of context. China and Pakistan ended up reaffirming their commitment to CPEC, with Beijing reportedly agreeing to take a closer look at some of the agreements finalized by the Nawaz Sharif government.

Later, Finance Minister Asad Umer dismissed reports that the volume of investment had been determined. Talking to Arab News on Monday he said: “The prime minister’s visit was meant to make agreements at the highest level with the King of Saudi Arabia and build a stronger relationship. In principle, only verbal discussions have taken place so far.”

Chairman of Senate Foreign Affairs Committee and senior PML-N leader Senator Mushahid Hussain Syed told Asia Times: “Thanks to the incompetence and confusion amongst the PTI’s inexperienced team, CPEC, the flagship of the Pakistani strategic relationship with our best friend China, has seen some unnecessary controversy.”

‘Confusion and mistrust’

Syed said that due to the prevailing confusion and mistrust between Beijing and Islamabad, the army chief had to go to Beijing to reassure Pakistan’s unwavering commitment on CPEC and allay misperceptions held by the Chinese. The matter was so serious, he said, that Army Chief Qamar Javed Bajwa had an uncustomary audience with Chinese President Xi Jinping.

“Despite the Finance Minister’s commitment to the National Assembly on Monday, his budgetary cuts may adversely affect the ongoing CPEC projects in Balochistan, including Gwadar, which is the centerpiece of CPEC,” Syed claimed, adding that he had reaffirmed Pakistan’s commitment to the bilateral scheme during his recent visit to Beijing, Xian and Chengdu.

Contradictory statements by senior PTI officials and the silence from the Saudi and Chinese governments had created doubts about Riyadh’s intention to join CPEC, former Finance minister and senior Pakistan Muslim League-Nawaz (PML-N) leader Rana Muhammad Afzal claimed.

He said any change, addition or reduction the government wanted to make to the scheme needed to be discussed in Parliament. He said the PTI was wrong to announce an expansion of CPEC ownership until sovereign agreements are redrafted with the consent of China and Pakistan. CPEC offered the country a path to an economic turnaround but the Khan government had mishandled the important and strategic project, he claimed.

Afzal said the ruling party suspected graft in CPEC deals from day one despite the fact the projects were done via state-to-state agreements. The chance of corruption in such deals was always minimal, he claimed.

Army chief

The Chinese had summoned the Army chief to Beijing because they knew he was calling the shots in Pakistan, which was a bad thing for Pakistan, Afzal said, as the Chinese foreign minister earlier visit to Islamabad had gone badly. “He did not come for any good reason but wanted to save CPEC and remind Islamabad about government-to-government commitment,” he explained.

Iranian authorities have not yet reacted to news that Saudi Arabia may get involved in CPEC, but some observers believe any such investment in Gwadar port will irk Tehran because China imports Iranian crude – an average 874,000 barrels per day in August. The Chinese have said it is “business as usual” with Iran, but imports of Iranian crude dropped to 581,000 bpd in September.

If Saudi Arabia does decide to invest in the CPEC, it could help fund an oil city project in Gwadar and deprive Iran of its main oil export destination. The 80,000-acre oil city would help transport oil from the Gulf region to Chinese ports through Gwadar.

This, they hope, would greatly reduce the time it takes to ship crude to China and also ensure a better supply, by helping Beijing cut its dependence on Iranian crude.

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