Only China can help Pakistan get out of economic, energy woes: Analysts
Source : The Nation Date : 22-09-2014
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ISLAMABAD - China, a trusted friend can help Pakistan to get out of its economic woes and energy crisis and it has already agreed to invest in Pakistan in different projects.
Realizing the importance of China, when Nawaz Sharif won elections in May 2013 and was poised to become the Prime Minister for an unprecedented third time, he met the visiting Chinese Premier Mr. Li-Keqiang in May 2013. This meeting laid the foundation of economic co-operation between the two countries, taking it to new heights.
Prime Minister Nawaz Sharif chose China for his first official visit after being sworn in to office which not only reflected his commitment to improve the economic conditions of the country but the role he envisaged China could play in achieving this goal. The present government has been holding in-depth talks with Chinese government since it came into power last year to strengthen and widen existing friendly relations between the two countries. The Chinese government committed to facilitate investment by Chinese companies in Pakistan and encourage Chinese companies by giving them comfort for their investments in Pakistan
Today, China is one of the countries which not only has one of the largest foreign exchange reserves but has developed State of Art technology in various areas. Pakistan seeks both China’s technology and investment to improve the life of its people. President of China, Mr Xi Jinping who was recently on a visit to India had to cancel his visit to Pakistan at the last moment, where he was due to sign contracts of 45.6 billion dollars, according to conservative estimates of government of Pakistan. These agreements envisaged an initial investment of 34 billion dollars.
The visit which has been cancelled because of situation created due to sit-ins by Pakistan Tahreek e Insaf (PTI) and Pakistan Awani Tahreek (PAT) would now have to be rescheduled, albeit at an enormous cost to the people of Pakistan.
The China Pak Economic Corridor Support Project (CPECSP) was approved by CDWP. Pakistan could have won many new deals upon arrival of Chinese President. According to the sources in the federal ministries of Pakistan many new agreements/MoUs between Pakistan and China in the fields of Energy, Infrastructure, Manufacturing, Railways, Communication, Information, Media, Culture etc. were ready to be signed. But still in the recent years Pakistan managed to attract a big chunk of Chinese foreign investment as a continuous process and many projects are under construction. Chinese government and Chinese private companies have already invested in different fields in Pakistan, especially in energy sector, road infrastructure and railways.
In the energy sector fourteen power projects including hydel, wind and coal projects with total investment of 15.5 billion dollars and a total production capacity of 10400 mega watts were likely to be signed during the visit and work on them was expected to start immediately. Besides, projects having total production capacity of 6120 mega watts are also contemplated to be installed with a total investment of 18.3billions dollars. These energy projects would meet the present and future needs of the country in increasing the growth rate and as well as stimulate economic activity which has been long held hostage due to deficiency of power in the country. China is also pouring its investment into alternate energy production. Bahawalpur solar park which is one of its own kind in South Asia and 100 MW Pakistan Wind energy project-II are under construction in this sector. This series of projects are expected to make the power sector strong contributory element in the National Development Scheme.
Projects for the construction of Lahore-Karachi Motorway and the Raikot-Islamabad section, necessary for the construction of Bhasha Dam were also to be signed during the visit of Mr Xi Jinpang. Another railway project for the expansion and reconstruction of existing line ML-1 having a length of 1736KMs and Havelian Dry port were also to be constructed with Chinese investment at the cost of US$ 3.7billion. The Chinese had also agreed to invest in the establishment of economic zone, an optical fiber cable project and in the field of communications at the total cost of US$ 1.64billion dollars.
The significance of the visit of the Chinese President to Pakistan was not only its help and assistance to a friendly country in meeting its short term energy requirements but also laying a foundation of a sustainable relationship which would stimulate growth, reduce poverty and unemployment by creating new opportunities for the people of Pakistan.
While the people of Pakistan were naturally anxious for the visit to give shape and directions to these landmark projects, which are necessary for Pakistan’s economy, the international financial markets and investors were closely watching this visit too.
Political and economic analysts say that one needs to understand that the timing of the visit of Chinese President to Pakistan was of utmost importance as it would have unleashed much needed investments in infrastructure and energy sector and created a sentiment where other investors would have jumped into the Pakistan market to benefit from the opportunities and potential that Pakistan presents today because of government’s sound economic policies and management.