- Chalks out plan with China to overcome current account deficit
- To offer Arab investors the same incentives as are being extended to Chinese companies
ISLAMABAD: With an eye on strengthening its economy and to overcome the current account deficit, Pakistan’s government said on Monday that it would invite firms from Ƶ, United Arab Emirates and Oman to invest in the prestigious China-Pakistan Economic Corridor (CPEC), a multi-billion dollar project.
Labeled as a “game-changer” for the country, China’s $60 billion investment is expected to develop Pakistan’s infrastructure and overcome energy shortage with the help of new projects under the Belt and Road Initiative (BRI).
“Both Pakistan and China have mutually decided to include a third party in the CPEC projects. And we will definitely seek investment from our friendly Arab countries in the industrial and energy-related projects,” Hasan Daud, Deputy Project Director CPEC, told Arab News.
He said that the initiative was discussed at length during Chinese Foreign Minister Wang Yi’s recent visit to Islamabad. “This is a mutual decision and a framework for it is being worked out,” he said.
At the meeting, both Yi and Foreign Minister Shah Mehmood Qureshi agreed to offer GCC investors the same incentives as would be extended to firms from Pakistan and China. “It is a golden opportunity for our friendly countries especially Ƶ, UAE, Oman and Bahrain to invest in the CPEC projects,” Daud said, adding that they were seeking investment particularly in the “export-led industry to overcome the current account deficit”.
Rebuffing reports of a renegotiation with China on CPEC as “propaganda by detractors”, Daud said the priority was now to work toward developing the social sector, Gwadar port, special economic zones and Pakistan Railways’ main line-1.
Dr. Ashfaque Hassan Khan, member of the government’s Economic Advisory Council, said that a “third-country” was being included to dispel the misconception that “there is no transparency in the CPEC projects.” “Investment from other countries will also help broaden the base of the projects and counter allegations of corruption and fraud in the investment,” Khan told Arab News.
He added that the move would further help share dividends of the BRI and ensure regional peace and development through infrastructure and social sector development. “This is a wise strategy and that’s why both Pakistan and China have agreed to it,” Khan said.
Political analysts, however, were quick to add a caveat.
Reasoning that the move was aimed at countering criticism of the BRI, Professor Tahir Malik — an academic and a political analyst — said that the initiative would help China increase its influence in the region, particularly Pakistan, as Islamabad would not be able to repay the money invested in the country by Beijing.
Malik said that China has been under increasing pressure from the United States and other western countries for its “debt trap diplomacy” in the region and the inclusion of a ‘third-country’ was aimed at increasing its ownership of the CPEC projects. “It will be a big achievement for both Pakistan and China if they succeed in getting a tangible investment in the CPEC-led projects from another country in the given international circumstances,” he told Arab News.