Myth and reality of CPEC

Eminent economists and technocrats has emphasized that government should fully define the Nitti Gritty of China-Pakistan Economic Corridor (CPEC) by removing the mystery shrouding it. They suggested the government should consider establishing a CPEC unit within the framework of Council of Common Interest (CCI) to manage the project with transparency and efficiency. The findings of the top policy making brains vindicate what has been featured in these columns about this project in recent months.

The Institute of Public Policy launched its 10th Annual Report Titled, “The State of Economy: CPEC Review and Analysis on Monday.” It reveals that the Chinese funded project has not been fully defined and developed. Renowned economist, Shahid Javed Burki stressed that to realize tits full potential CPEC program must have the support of all citizens. This seems to be a subtle reference of the changed priorities of PML-N government for the implementation of this project. He exploded the  myth created by incumbent federal government about CPEC and highlighted its true picture. Shahid Javed Burki said the project was touted as game changer but it would possibly add 2 percent to growth rate of GDP. This is in sharp contrast to the claims of what the Federal Minister for Interior, Planning and Reforms, Ahsan Iqbal is making the people believe. However, he agreed to the notion that the project will bring greater integration of Pakistan’s backward areas into that of more developed ones.

Former governor State Bank of Pakistan, Dr. Ishrat Hussain said that we should not accept false hopes through CPEC project, as the case of establishing industrial zones is in infancy, so we are just analyzing about industrial zones. The former central bank governor was of the view that the great hope through CPEC should be advancement in technology and human development. He said for future competition among nations it will be human resource and technology as resources like oil and other things will become secondary. Dr. Ishrat Hussain has struck the right not because the economic progress and prosperity of Japan, and South Korea rests on their advancement in technology and enormous pool of highly skilled human resource. But the governments in Pakistan deliberately neglect human resource development to perpetuate the hold of feudal and mercantile classes over the corridors of powers and national resources.

Further deflating the game changer balloon of CPEC, former Foreign Secretary Shmshad Ahmad Khan dispelled the impression that the project will benefit Pakistan alone. He said it will connect Asia with Europe. He made a very pertinent point that it should be completed as nation’s economic core program and our politicians should remain out of this project otherwise CPEC will become another Kalabagh dam for Pakistan.

The report of Institute of Public Policy provides valuable and workable guideline to the government to make CPEC really beneficial for the people in general and not for a handful of elites. The government has not clarified the media reports that certain road projects on the western route have hit snags, modernization and refurbishment work of Peshawar-Karachi railway track has not been delayed indefinitely and Diya Mir Bash Dam has been withdrawn from CPEC framework because China’s conditions for its financing ran contrary to national interest.  The government is not disclosing the details of contracts about the thermal power plants projects to know as to whether these contracts also include the clauses of capacity charges like the contracts of local IPPs which is a major cause of massive circular debt accumulation. There is nothing in black and white as to which environmental laws will be applicable to health hazardous Chinese Coal based thermal power plants as these plants do not have built-in Carbon Scrubbles to reduce the carbon content emission like the German thermal power plants which are relatively environment friendly, having the built-in provision for Carbon Scrubbles.

The reason for the creation of revolving fund in commercial banks for advance payment to Chinese thermal power generation companies is not disclosed in the parliament. The essential ingredient of transparency in the award CPEC contracts is totally missing as only Chinese companies are allowed to submit their tenders and take part in bidding process. The Ambassador of the United States David Hale, in his visit of Islamabad Chamber of Commerce and Industry on December 24, complained in lighter vein about ignoring American highly reputed companied in CPEC contracts. The government has not shown seriousness for human resource development and creation of a sound base for the indigenization of 5th generation technology that would with the Chinese special economic zones. The proposal of the Institute of Public policy to establish a CPEC unit in the Council of Common Interest is worth consideration.