ISLAMABAD – China Pakistan Economic Corridor (CPEC) projects has notimposed any immediate debt burden on government of Pakistan as theseprojects are financed through a composite financing package comprisinglong-term government-to-government concessional and preferential loans, aswell as grants from the Government of China.
“It must be clarified that repayments on these loans would not commence inthe immediate future,” a statement issued by Ministry of Planning Tuesdayclarified in response to Western media reports on CPEC.
“We have noted recent media reports questioning the viability of ChinaPakistan Economic Corridor (CPEC), claiming that it would create anunbearable debt burden for Pakistan. Such media reports are oftenone-sided, distort facts, and are based on irresponsible statements byindividuals who either have no understanding of CPEC or are driven byulterior motives,” the statement said.
While constructive critiques and recommendations by experts and analystsare always welcomed, however it is important that such critiques beinformed by research based on factual information rather than mere partialopinion.
Energy sector is a key priority area under CPEC’s early-harvest phase andresponds to our immediate energy needs.Chinese companies are investing in the energy sector in IPP mode and haveraised funds from Chinese banks and investors. These do not constitute anydebt obligation on the Government of Pakistan.
It is because of the favourable financing arrangements that Pakistan optedfor Chinese investment under CPEC. China stepped forward to supportPakistan’s development at a time when foreign investment had dried up, andeconomic activity was being crippled by energy shortages and infrastructuregaps.
CPEC has provided enormous opportunities for Pakistan to grow economically.It is an engine for economic growth and will increase Pakistan’s GDP up by2% to 3%. CPEC has also facilitated in overcoming crucial energy, transportinfrastructure and supply chain bottlenecks. Under CPEC, development ofGwadar would ensure strengthening of maritime sector particularly thecoastal tourism and local fishery industry thereby benefitting the localcommunities.
Pakistan has repeatedly stated that it is fully committed to CPEC, whichenjoys complete consensus among all institutions and political forces inPakistan. It is a win-win project that is key to the future of Pakistan’ssocio-economic development.
It is not surprising that detractors of Pakistan-China cooperation arepresenting a negative image of CPEC and the benefits that it brings to thepeople of Pakistan. Their negativity cannot weaken our resolve andcommitment to CPEC.
Pakistan offers attractive investment opportunities. We welcome allcountries to take advantage of this favourable environment and to invest indevelopmental projects in Pakistan instead of levelling unfounded criticismagainst a country that has stood by Pakistan at all times, the statementconcluded.