Monday July 22, 2024

CPEC concerns

By Mushtaq Rajpar
December 21, 2017

Pakistan and China have finally launched the detailed CPEC plan as was promised by Federal Planning Minister Ahsan Iqbal. After going through the details of the plan, one wonders why it was kept secret for so long. Most of the projects and linkages it seeks to develop have already been debated across the country.

The launch of the detailed CPEC plan neither adds anything new to our understanding of this project nor helps remove the concerns of critics regarding the overall impacts of the project. It is important to understand that critics of this project are not anti-CPEC; they just feel that they, as informed and concerned citizens, have the right to question the government on programmes and agreements.

Debating economic plans is not testing one’s faith in nationalism or patriotism but about the ability to critically evaluate implications. After all, allowing a foreign government a footprint on our land should require extensive debate and discussion among local citizens and provincial and federal governments.

While the government projects CPEC as an attempt to help Pakistan develop, modernise and grow, we must realise that this project is first and foremost meant to further China’s economic interests. China is no more a rising economy but an economic giant, an economic superpower with its own needs of expansion to sustain growth rates and meet the energy demand, access to secure trade routes, outposts and transit routes.

Is there any doubt that it needs the Gwadar Port and new route through Pakistan as a transit trade route? Chine is not the first big economic power seeking that access; all big economic powers have done so. Pakistan will have to take care of its own interests. We know, from all the experiences of the past and the present, that the relationship between countries are influenced and shaped by their relative power.

China has an edge on us; they, after all, are at the giving end and we at the receiving end. The national tragedy is that we do not prepare ourselves for hard times and at the end are not left with few options. And then we ask: what option did we have. In the current case, the logic is that we have been abandoned by the US and no other country shows any interest in investing in Pakistan – and that China does.

How did we reach a situation where we are essentially standing alone? A country of our size, whose four million citizens send home over $17 billion in remittances, why have we been aid dependent? Why have we been suffering from one crisis to the next? We take oaths of breaking the begging bowl, but then we rename the bowl, let our currency adjust, add foreign loans, and breathe in the fake confidence that we are saved. This time, the saviour happens to be CPEC. It is not just the secretive nature of CPEC that makes us a little wary. It is also our past history of leadership failing us time and again.

For the past few years, ever since CPEC discussions became more public, did anyone inform people that Gwadar is being given to China on a lease for 40 years, that 91 percent of its earnings will be taken by China and a meagre 9 percent to locals? This was revealed by State Minister Hasil Bizenjo and it obviously shocked everyone. Recently Railways Minister Saad Rafiq was quoted as saying that “If China is not giving loans at certain (interest rate) level and (under) favourable conditions, Pakistan Railways will not take over $8bn loans”.

Pakistan has admitted that most of the development projects that CPEC will undertake are based on loans. This has been the concern of Pakistani critics, including economists. How can we call loans an investment? And if we are to take loans and borrow money, we should have our own development priorities. Are critics wrong when they say that since most of the road infrastructure and energy projects are needed by China for transit routes and corridors, why don’t they pay for it? Why are we taking loans to pay for what they need for their economic expansion?

Let us look at Sri Lanka, where China invested $8bn. The Sri Lankan government was not able to pay the debt and to settle the accounts. The Sri Lankan government entered into an agreement with China and ended up leasing out their island port to China for 90 years. It makes no sense to in the end sell our ports and land against loan settlements.

Understanding the details of the CPEC plan and having our Senate debate the nature of the project is a welcome development. Only an informed, honest and open debate will help us protect our long-term national interests.

It seems we have shown a strong tendency to see CPEC as a security-driven project more and an economy-driven project less. We must realise that with a population of more than 200 million people, we need to explore diversified sources of investment from multiple countries with a solid focus on diverting our own resources on social development. But first we need to put our house in order.


Twitter: @MushRajpar