Projects to benefit Pakistan’s economy
Print Edition
CHINA and Pakistan yesterday launched a plan for energy and infrastructure projects in Pakistan worth US$46 billion, linking their economies and underscoring China’s economic ambitions in Asia and beyond.
China’s President Xi Jinping arrived in Pakistan to oversee the signing of agreements aimed at establishing a China-Pakistan Economic Corridor between Pakistan’s southern Gwadar port on the Arabian Sea and China’s western Xinjiang autonomous region.
The plan is part of China’s aim to forge “Silk Road” land and sea ties to markets in the Middle East and Europe.
Xi, whose visit to Pakistan winds up today, said it cemented an “all-weather strategic cooperative partnership” between the neighbors.
Pakistani Prime Minister Nawaz Sharif said the corridor would transform Pakistan into a regional hub and enable China to create a shorter and cheaper route for trade and investment with south, central and west Asia and the Middle East and Africa.
“Friendship with China is the cornerstone of Pakistan’s foreign policy,” Sharif said in a speech.
Xi was given a lavish welcome as he arrived yesterday morning at the Nur Khan air base in Rawalpindi, next to Islamabad, where he was greeted by Sharif and President Mamnoon Hussain.
After talks in the afternoon, Xi and Sharif symbolically broke ground on five projects around the country via a video link, before signing a series of agreements.
The two allies agreed yesterday to set a target of raising bilateral trade to US$20 billion in three years.
China has become Pakistan’s largest trading partner. Two-way trade exceeded US$16 billion last year, marking an annual growth of 12.57 percent.
The two sides also agreed to adopt proper measures to alleviate their trade imbalance and facilitate the second phase of negotiation on a China-Pakistan free trade agreement, said a joint statement.
“The real opportunity of this China Pakistan Economic Corridor is that it changes the scope of the relationship from geopolitics to geoeconomics,” Ahsan Iqbal, the minister overseeing the projects, told AFP.
The projects foresee the creation of road, rail and pipeline links that will cut several thousand kilometers off the route to transport oil from the Middle East to China.
The upgrade will stretch 3,000 kilometers from Gwadar to China’s western city of Kashgar. Pakistan transferred control of the port to a Chinese public company in 2013.
Iqbal said US$11 billion has been set aside for infrastructure work on the corridor, while the remaining US$35 billion will go on energy projects.
Gas, coal and solar projects are planned to provide 16,400 megawatts of electricity, said Iqbal. Pakistan has wrestled with chronic power shortages in recent years that have curbed GDP growth and inflicted misery on the lives of its citizens, he said.
“These are very substantial and tangible projects which will have a significant transformative effect on Pakistan’s economy,” Iqbal said.
In yesterday’s edition of Pakistan daily The News, Xi said the two countries should align their development, trade and economic strategies more closely.
Pakistani officials have said China’s government and banks, including China Development Bank and the Industrial and Commercial Bank of China Ltd, will lend to Chinese companies, which will invest in projects as commercial ventures.
Those investing in projects will include the Three Gorges Corp, China Power International Development Ltd, Huaneng Group, ICBC Corp and Zonergy Corp, officials said.
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