ISLAMABAD – The Western media’s recent reports regarding China PakistanEconomic Corridor (CPEC) are based on incorrect information, distortedfacts and one-sided opinions of individuals.
It is hereby clarified that China Pakistan Economic Corridor (CPEC) is aflagship and most active project of Belt and Road Initiative where 22projects of worth $ 28 billion have been actualized over the past 04 years,said a statement issued by FBR here Thursday.
The project could not be compared with Chinese overseas investment in SriLanka or Malaysia as frameworks and financial modes of CPEC are altogetherdifferent in nature. The CPEC finances are divided in government togovernment loans, investment and grants. Infrastructure sector is beingdeveloped through interest free or government concessional loans.
Gwadar Port is grant-based or investment which means the Government ofPakistan does not have to pay back the invested amount for the developmentof the port.
Energy projects are being executed under Independent Power Producers (IPPs)mode and finances are mainly taken by the private companies from ChinaDevelopment Bank and China Exim Bank against their own balance sheets,therefore, any debt would be borne by the Chinese investors instead of anyobligation on part of the Pakistani government.
Pakistan has opted for Chinese investment under CPEC due to the favorablefinancing arrangements. China stepped forward to support Pakistan’sdevelopment at a time when foreign investment had dried up, and economicactivities were being crippled by energy shortages and infrastructure gaps.CPEC is not imposing any immediate burden with respect to loans repaymentand energy sector outflows.
The CPEC’s outflows would start from the year 2021 and spread over 20 to 25years with a maximum in the year 2024 and 2025. The resultant benefits ofthese investments to the Pakistan economy would far outweigh these outflows.
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CPEC has provided enormous opportunities for Pakistan to grow economically.It is an engine for economic growth and is expected to increase Pakistan’sGDP growth by 2 percent to 3 percent. CPEC has also facilitated inovercoming crucial energy, transport infrastructure and supply chainbottlenecks.
Under CPEC, development of Gwadar would ensure strengthening of maritimesector particularly the coastal tourism and local fishery industry therebybenefiting the local communities.
Pakistan has repeatedly stated that it is fully committed to CPEC, whichenjoys complete consensus among all institutions and political forces inPakistan. It is a key to the future of Pakistan’s socio-economicdevelopment.Within the broad parameters of the already approved CPEC framework, thepresent government, with mutual consultation of Govt. of China isbroadening the base and expedite pace of CPEC. A mechanism is beingdeveloped to include third party participation in CPEC.
Socio-economic development and poverty alleviation are being included inCPEC and a separate working group is being established to fast track thisdimension of the mega project. Gwadar continues as prioritized and beingdeveloped as standalone project and a transshipment hub based on blueeconomy principles.
Industrialization under CPEC has already been fast-tracked and 04 SEZswould hit the ground soon.
