Reprioritising CPEC

Prime Minster Imran Khan has formed a Cabinet Committee on China Pakistan Economic Corridor (CPEC) as the new government is discussing reprioritisation of projects under its umbrella. Planning Minister Khusro Bakhtiar will be the chairman of this committee. There will be nine members on the committee including minister for foreign affairs, minister for law and justice, minster for finance, state minister for interior, advisor to the Prime Minister on commerce, textile industry and investment and cabinet Secretary.

The composition of CPEC and other Cabinet Committees reveals that political culture of concentrating decision making in one hand, on the premise of one man say is the order of day, has gone. In Nawaz Sharif government the accountant finance minister Ishaq Dar used  to make all decisions without taking input from other relevant ministries, whereas in PTI government the cannon of delegating powers to the right man for the right job is all pervading. And the Chairmen of Cabinet Committees will take decisions after thorough deliberation with other ministries to obtain useful input.

At the time of CPEC inception, both China and Pakistan had prepared short-to-long term programmes to implement the $ 60 billion of pilot projects of the Belt and Road Initiative (BRI). Both countries had finalised a list of prioritised projects to be completed by 2018-19 and actively promoted projects to be implemented by 2022. CPEC was originally conceived as connectivity project, which was largely converted into health hazardous coal based energy project by PML-N government for achieving political gains in the 2018 polls. The priority list of the previous government comprised 14 coal fired thermal power projects, having total generation capacity of 10600 megawatts. But the PTI government is very much concerned about the vulnerability of Pakistan to the impact of climate change for its being seventh on the list of Climate Change Risk Index. The new government desires to implement environment friendly power projects and has decided to take a holistic view of CPEC projects and wants to move away from the high density carbon emitting coal based power plants to clean energy projects.

The incumbent government is also cognizant of the highly inflated construction cost of certain CPEC related projects. A decision was taken in the meeting of federal cabinet to conduct the forensic audit of mass transit projects including $ 1.65 billion Lahore Orange Line Train Metro Project. However, the same rule should also must apply to the under NAB investigation BRT Peshawar Metro project. It should not be treated as a holy cow.

The finance ministry and planning ministry would closely collaborate to ensure that only financially viable and economically sustainable CPEC projects are taken to the next stage. The $ 2 billion Karachi Circular Railway and $ 8to 10 billion 1782 kilometer Karachi-Peshawar railway track refurbishment Main line M-1 project faced serious problems as the Chinese estimate of cost were not compatible with one worked out by the Railway Ministry. The mainline M-1 railway track project was scheduled to be completed during 2016-20. The revised plan suggests that the project can not be completed before 2022 in case the financing modalities are finalised and the loans liability is taken by the central government. Construction work on certain roads project in Khyber Pukhtunkhwa and Baluchistan had hit snags. Likewise $ 1.7billion Matiari-Lahore high voltage transmission line project did not materialize and delayed for three years.

In an informative article on the eve of CPEC summit 2018 a Chinese economist Professor Jia Yu cautioned the CPEC is not a gift. Pakistan should not take it for granted. Both public and private sector must take ownership of the opportunities. Pakistan’s interests lie in promoting growth, private sector investment, employment, exports,; technology transfer and skill development for the intended relocation of Chinese industries to the Special Economic Zones (SEZs). The PML-N government kept the Nitti Gritty of CPEC and despite its overselling did not divulge information about the prospects of joint ventures of Pakistani entrepreneurs with their Chinese counterparts in the SEZs. The private sector was not assured that SEZs are open to all for investment. On the contrary Chairman State Engineering corporation shattered the confidence of Pakistani entrepreneurs when he told business leaders at Islamabad Chambers of Commerce and Industry that would have to move from the current second generation technology to fifth generation technology if they want joint ventures with Chinese entrepreneurs. How this long jump can be taken by Pakistani industrialists without the active cooperation the government. It is time to remove the secrecy lid from the CPEC related projects.

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