The 10th anniversary of CPEC duly celebrated in an impressive ceremony held in Islamabad a few days ago with Chinese Vice Premier HE Lifeng as the chief guest, marks the successful culmination of CPEC phase-1. This phase has provided a launching pad to Pakistan\’s economy to take off, which would usher in an era of economic prosperity not only in Pakistan but the entire South Asian region.
It may be mentioned here that I have already deliberated on the subject in detail in my earlier write-up written a few days back in which I discussed the strategic and economic significance of CPEC for China and the West’s reservations over the project. This time, my deliberation will serve as an appendage to my earlier write-up and will mostly focus on the economic implications of CPEC for Pakistan. It would mainly revolve around phase-2 of this flagship project in a rather unconventional manner. The prospective benefits Pakistan would reap from CPEC, and the likely colossal economic loss it would have suffered had there been no CPEC, would be highlighted.
Without going into nitty-gritty and technical details of the project, I would present a snapshot of the projected economic development plan that is being pursued in order to propel the required economic growth leading to another milestone expected to be achieved in the foreseeable future.
CPEC phase-2 is crucial to give necessary impetus to the economic growth that is expected to be achieved through the projects being launched during this phase with an accelerated speed. This is required to steer the Pakistan out of the deepening economic crisis and stave off the looming danger of a possible default despite the fact that currently, the country is facing no such imminent danger, and also to instill confidence in the people of Pakistan who are subjected to a state of uncertainty due to the scary picture of the economy portrayed by doomsday predictors.
CPEC is planned to be completed in three phases. Phase-1 has already been completed with the development of necessary infrastructure like an elaborate communication network that include highways/motorways and railway lines, commissioning of deep sea port at Gwadar, and much-needed power generation. These projects which have already been completed will facilitate a smooth sailing to all the development works that would be undertaken during the second phase.
During the second phase, economic development across Pakistan is envisaged through investment in key sectors like industry, agriculture, tourism, technical education, IT, healthcare, establishment of Special Economic Zones (SEZ) which include food processing, cooking oil, ceramics, gems, marble, minerals, agricultural machinery, iron and steel, electrical appliances and automobile. Besides, investment is made in joint venture projects to counter the devastation brought about by climate change, poverty alleviation, and above all, provision of millions of job opportunities through mutual cooperation in different sectors as mentioned above.
CPEC has helped Pakistan overcome numerous challenges like power shortage, rehabilitation and reconstruction of decades old dilapidated roads and communication infrastructure.
Before the launch of CPEC, Pakistan was facing an acute shortage of electricity. Industries were being closed, business opportunities were slowly and gradually shrinking resulting in loss of thousands of jobs directly attached to the industry.
According to a conservative estimate, the country was losing 5-6 billion dollars annually. If CPEC energy projects hadn’t been launched, Pakistan would have faced electricity load-shedding roughly five times more than what we have today, and the electricity cost per unit would have surged to three times more than what we are paying today. With the increase in population as is evident from the latest census of 2022, the problem would have aggravated further. As a result, we would have suffered load-shedding of unimaginable proportions.
In a nutshell, in the absence of power projects made operational by CPEC, Pakistan would have faced worst kind of electricity shortage, leading to closure of industries, loss of thousands of jobs directly and indirectly attached with this sector, health issues and closure of business.
It\’s pertinent to mention here, that in 2013/14, no country was willing to invest in Pakistan due to terrorism being at its peak and also due to the COVID-19 pandemic. At that critical time, it was only China which came forward to make huge investment in Pakistan in the shape of CPEC knowing fully well that it was a highly risky affair. China’s bold decision helped Pakistan not only rehabilitate and refurbish the decades old worn out infrastructure but also provided capital and expertise to launch new infrastructures. It also helped Pakistan tackle the security and the pandemic issues successfully.
When we talk of communication infrastructure under CPEC, we see a massive improvement in this sector. According to statistics available with the CPEC officials, around 3000 km motorways/highways have been constructed across the country which has improved connectivity that in turn, has become instrumental in attracting foreign investment. Now, many countries are evincing interest in joining CPEC despite intense opposition by both the US and its allies.
With regard to skill development of youth, China has provided millions of dollars for skill development of youths under CPEC. Chinese companies have imparted skill development training to the youth that has enabled them to create self-employment opportunities.
Economic experts dealing with CPEC affairs predict that the project will result in the creation of 2.3 million jobs till 2030 and add to around 2.5 percentage point to the country’s annual economic growth. According to them, currently, the project has fairly enhanced Pakistan’s exports and development capacity and is providing 1/4th of total electricity which wouldn’t have been possible without CPEC.
In the light of the above discussion, it can safely be inferred that CPEC has turned out to be veritable blessing for Pakistan. Had their been no CPEC, Pakistan would have suffered economic loss of biblical proportions.
Those who dance to the tune of the West and it’s strategic ally India, take the CPEC with a grain of salt and appear to be markedly critical of the project, thus raising eyebrows over it and expressing apprehensions of the debt trap Pakistan may be caught in. They fail to appreciate that any country while entering into an agreement entailing a project of an epic magnitude with another country, considers its national interest first and foremost. Give-and-take policy is the core element in any such undertaking which is the rule of business every country follows.
If China has decided to make a massive investment of uncommon magnitude to the tune of $62b in Pakistan, it’s not without the visualized and prospective economic dividend that would be accruing to it from the investment. Likewise, if Pakistan has decided to take the plunge, it’s not without the projected economic benefits it’s going to reap out of it. The critics need to understand that no country in the world believes in gratuitous investment. In this regard, it should be borne in mind that every adventurous and ambitious undertaking entails a huge risk which the adventurer is ready to take both physically and mentally.
Over the years, our economic woes have been snowballing due to our unenterprising and pro tem economic policies bereft of economic vision and professional approach which unfortunately, has remained a far cry. We have been evincing an intense desire to achieve economic prosperity and make the country economically invincible, but without applying professional approach and without putting in required hard toil and taking required measures in this regard. We fail to appreciate that merely wishing for economic prosperity and self-reliance without working hard and showing matching ability to achieve it would remain a mere desire and nothing more, as they say, ‘ if wishes were horses, beggars would ride’.
Now, slowly but surely, we are proceeding towards economic self-reliance and seem to have a will to break the begging bowl and shed dependency on foreign loans; and it’s earnestly hoped that soon we would be in a position to leave turbulent times behind, achieve economic prosperity and see the country transformed from a borrower to a lender country, thus freeing it from the cruel clutches of lender agencies like IMF, WB, ADB and the likes.
Nations do face difficult times but they don’t give in; rather, they exhibit courage and determination, and plan for the worst-case scenario and prepare themselves to face any eventuality, and ultimately, manage to come out of it gracefully. This is how great nations conduct themselves.