Sunday, November 26, 2017

Valid concerns over CPEC


Why so much secrecy?

Since its inception the PML-N has kept a veil of secrecy over the modalities of China Pakistan Economic Corridor (CPEC). CPEC is part of China’s long term One Belt One Road (OBOR) to connect with Eurasia as an attempt to solidify its growing role in global affairs and trade.

For Pakistan the massive infrastructure and energy projects are truly a game changer. Perpetual shortage of energy remains a bane for the economy and megawatts that will be added to the grid under CPEC are vital for growth.

Legitimate concerns have been expressed by opposition parties who are fearful that a majority of the benefits to be reaped under CPEC will be skewed in favour of Punjab, the ruling party’s stronghold. The lack of transparency over the details of CPEC further fuels these reservations and creates unnecessary controversy over the issue.

Limited and incomplete information is available about the timeline, cost and progress of individual projects. Confusion also surrounds the exact nature of the funds that are being provided by China. If they are long term loans then what is the markup rate and term of the loan? If there is equity involved in the projects then what are the terms of revenue repatriation?

Even senators from within the ruling party and its allied parties have started voicing similar concerns including criticism and in return there is little substance in answers that are presented by senators defending CPEC.

Prior to the second Joint Coordination Committee (JCC) the Chinese had requested that the Yuan become legal tender in Gwadar, a proposal that was shot down by Pakistan. It was learned only yesterday that the Chinese will receive a whopping 91% of the revenue generated from Gwadar for 40 years. No debate with stakeholders has been undertaken over both these issues.

Until and unless the government starts providing periodic detailed progress reports on all CPEC projects that are open to debate and criticism, everyone will look at this national issue with suspicion and that will be detrimental to the whole endeavor itself

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