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CPEC has changed economic outlook of Pakistan, S Asia

December 03, 2016

WASHINGTON: The experts from China, Pakistan and India have agreed that China Pakistan Economic Corridor (CPEC) has changed the economic and security outlook of Pakistan and South Asia with far reaching international implications.

Speaking at United States Institute of Peace (USIP) here on the issue of $46 billion trade initiative between China and Pakistan, experts said the Corridor had changed the narrative about Pakistan globally.

Expert on Indian affair, Sarah Watson stressed that in the absence of any action from New Delhi about CPEC, India’s worst imagination would come to reality. China and Pakistan hope the project’s roads, rails and pipelines will help stabilise Pakistan and the broader region. “Unless India really engages in a very concentrated programme of infrastructure building and outreach in next a few years, its worst imagination is more likely to come true,” said Watson who is Associate Fellow, Wadhwani Chair in US-India Policy Studies, Center for Strategic and International Studies.

She said increasing Pak-China cooperation would not only pose military challenge to India but also would affect its access to lucrative trade routes. Watson was of the view that India had three policy visions vis-à-vis CPEC.

Firstly, she said India looked at the Corridor as a kind of military alliance between China and Pakistan and it was concerned about that. Secondly, India’s also looked at CPEC as an economic opportunity which could benefit New Delhi if it became part of this initiative.

Thirdly, she said India’s response to CPEC was Chabahar port which it was developing with Iran as alternative route to Afghanistan and Central Asia. “Out of these three possibilities, two needs action on part of India in near future while the first option does not require anything on part of India,” she said.

Pakistan expert at Asia Centre, USIP, Hussain Nadeem said CPEC had changed conversation about Pakistan even in Washington. “In 2012 when I visited the United States conversation about Pakistan was focused on security. But in 2016 thanks to CPEC, Pakistan is also discussed in terms of trade and economic opportunities,” he said.

Referring to his fresh talk with Minister for Planning Ahsan Iqbal in Pakistan, he said 70 percent early harvest project under CPEC had already been completed. He said $50 billion Chinese investment came to Pakistan when the country was isolated economically but the initiative had changed the mindset of international community about Pakistan.

Nadeem was of the view that CPEC success was in the interest of world as it would make Pakistan more peaceful and progressive. He said before CPEC China-Pakistan ties were devoid of substance but the initiative had changed the dimension of these relations. He said

CPEC had changed the morale of Pakistani people and now they believed in their future and the country had started growing rapidly. He said CPEC had given people genuine hope that fate of their country would be changed. “This is something over $5 billion US aid under Kerry-Lugar Bill could not do.”

Hai Zhao, Research Fellow at National Strategy Institute, Tsinghua said Chinese President Xi Jinping was personally involved in CPEC so all the companies and public institutions wanted to participate very enthusiastically.

“The biggest reason for China in CPEC is economic,” he said adding that China invested over trillions of dollars to avert the economic crisis in 2008 which inflated the Chinese industry.

He said the inflated Chinese industry needed international market to use their resources and “Even if they do not get much profit from CPEC projects, Chinese companies are giving them opportunity to gain experience to be international competitiveness,” he said adding that investment under CPEC would continue in near future for these reasons.

He said Chinese domestic media celebrated the first trade conveys arrival in Gwadar last month. However, he mentioned that some companies had concerned over internal political differences in Pakistan over CPEC projects and they were trying hard not to get involved in domestic disputes of Pakistan.

Hai Zhao said many Indians were against CPEC but the project was not aimed at India as China was also working on another road which goes through India and Myanmar.’ “However India is proposing road projects that are at 90 degree angle with Chinese proposed roads which is making the cooperation difficult,” he said.

Arif Rafiq, Fellow at Center for Global Policy highlighted challenges to CPEC within Pakistan. He said there were misconceptions about the project internationally as many considered it as a tunnel or long road but it was totally a different kind of initiative which was aimed at fulfilling Pakistan’s economic agenda.

He said most of the roads under CPEC were not new but they were being expanded to improve the speed of transportation. He said the government claimed it would be able to generate 17,000 megawatt of electricity under CPEC but his estimates suggested that around 8.000 megawat will be generated.