May 28 , 2017
News
The Real CPEC Plan
By: Hasaan KhawarAs Prime Minister Nawaz Sharif stressed the need for a dialogue with countries outside One Belt One Road to dispel apprehensions about the initiative, national media in Pakistan revealed a 'long-term CPEC plan', which apparently had not been shared with the public so far giving rise to a number of unwarranted concerns and rumors. The critics questioned not only the document but also speculated about the 'real' objectives of CPEC. Many of these concerns however, were completely unfounded and have done more damage than good.
The CPEC plan shared by media was an outdated document. The actual plan that sets the foundation for China Pakistan Economic Corridor is a different document and has seven areas of cooperation.
There is a need to objectively look at what CPEC is and how it is being planned. It is true that CPEC goes way beyond infrastructure development. In fact, the actual CPEC plan aims at forming a "1+4" collaboration pattern with 'CPEC and its four priorities, namely the Gwadar port, energy, infrastructure construction and industrial cooperation'. It must be understood that infrastructure development is just the start of CPEC, paving way for much broader cooperation for economic integration and growth, ranging from industrial collaboration to agriculture development and from tourism to financial integration.
Pakistan is at a transformative moment, where CPEC is expected to usher in a new era of economic development with a newly developing Belt and Road alliance. CPEC is likely to provide a powerful stimulus to our national economy. This however, would need building a national consensus, adequate preparation by the government and private businesses, anticipating and mitigating risks and reaping CPEC's benefits beyond the infrastructure.
In 1960, if Lee Kuan Yew, with his tiny city state of Singapore and a population of merely 2 million poverty-ridden people, had feared the forces of globalisation, Singapore would still be ranking somewhere in bottom few countries of the world, if it all it had managed to exist. Instead Lee linked his country's future to massive forces of globalisation, using foreign direct investment to stimulate growth. Singapore now has world's highest trade-to-GDP ratio.
On the other hand however, history is marred with stories of failures, where countries refused to embrace opportunities coming their way or somehow failed to capitalise on them.
Recent media reports revealing a so-called CPEC plan caused concerns in many quarters and sprang a rumor factory in action. Pakistan, it seems, is at a similar crossroad of history. How the country will respond to the changing face of globalisation and new economic imperatives would define where would it end up a few decades down the road. CPEC is the litmus test of how we choose our future.
There is therefore a need to separate myths from realities. CPEC is not merely about 'agriculture', 'surveillance of cities' or 'visa-free entry of Chinese nationals', as quoted by media. CPEC is about trade, infrastructure investments and increased Pak-China cooperation in a number of sectors.
The Long-Term Plan Passé
China initially developed a detailed draft document, which was shared and discussed with Pakistan. From Chinese side, China Development Bank (CDB) was commissioned to develop this document, sponsored by National Development and Reform Commission (NDRC). This draft plan, a 239-page document dated December 2015, provided many details on Chinese perspective on CPEC. Although the plan was quite broad in its scope, it did propose some very specific details regarding a few sectors.
The New CPEC Plan
More recently however, a 30-page summary plan, dated February 2017, replaced this initial detailed draft and formed the basis of developing a formal agreement on CPEC between Pakistan and China. This summary plan was structured around five chapters. The long-term plan is effective until 2030, spanning short-term projects that will be completed by 2020; medium-term projects by 2025; and long-term projects by 2030 or later. The summary plan only provides broad principles of cooperation, to set the tone for working out the details in future.
The plan recognises that economic and social development ties between China and Pakistan have entered into a new phase in recent years, with both sides now developing "multiple wheels" to drive their bilateral relations forward. It states that 'the China-Pakistan Economic Corridor, starting from Kashgar in Xinjiang, China, and reaching Karachi and Gwadar, southern coastal cities in Pakistan via the Khunjerab Pass and several other nodal areas, constitutes a key platform and a central task for cementing China-Pakistan economic relations'.
What is CPEC?
CPEC represents a portfolio of projects that are either under progress or will be undertaken as a result of China-Pakistan cooperation under the landmark Chinese Belt and Road initiative, deepening China's connectivity with the world. Presently, the total size of the projects envisaged under CPEC stands at USD 54 billion, upgraded from USD 46 billion. The portfolio primarily includes major road and other infrastructure projects, establishment of special economic zones and an improved supply of electricity, besides an ambitious optical fiber cable project. It is expected that road network developed under CPEC will link China with Gwadar and other ports and will lead to development along the route and beyond. From within the China, the northwestern autonomous region of Xinjiang specifically is expected to immediately benefit from this improved connectivity.
While all these projects have varying timelines, some of the projects are categorised as 'early harvest' projects under CPEC that are being fast tracked. Five joint working groups have been formed under Joint Coordination Committee (JCC) of CPEC to drive their respective areas including: long-term planning, energy, transportation infrastructure, industrial cooperation and Gwadar port. On Chinese side, National Development and Reform Commission of China houses the JCC secretariat, whereas in Pakistan Ministry of Planning, Development and Reforms of Pakistan has taken over this role.
Courtesy www.dailytimes.com.pk