CPEC Monthly Monitor May 2017 Final 1

May 2017
A review of national, bilateral

and regional dynamics
CONTENTS
A Overview
B NATIONAL PERSPECTIVE ON CPEC
C BILATERAL
REGIONAL / INTERNATIONAL
D DYNAMICS
E ANALYSIS
CPEC Monitor | May 2017
A OVERVIEW
In the month of May 2017, there were several indicators of

strengthening internal consensus in Pakistan on the China-Pakistan
Economic Corridor (CPEC). For one, chief ministers of all four provinces
of Pakistan accompanied Prime Minister Nawaz Sharif during his visit to
China to attend the Belt and Road Forum (BRF) summit in Beijing. Also,
provincial political leaders including government officials were found
largely positive in their statements, responses and actions in relation to
the CPEC. For instance, Khyber Pakhtunkhwa (KP) Chief Minister Pervez
Khattak said his governments concerns about CPEC were addressed.
The KP government also signed several bilateral MoUs with Chinese
companies, which were though criticized by a leader of Awami National
Party (ANP) and Pakhtunkhwa Ulasi Tehrik for being mere false
demonstrations. Sindh government in particular showed enthusiasm in
engaging in CPEC-linked projects. Sindh Chief Minister Syed Murad Ali
Shah offered to host the next joint working group meeting of Chinese
and Pakistani officials in Karachi. Prime Minister and other government
officials ensured time and again that Balochistan will be the main
beneficiary of Gwadar Port and CPEC. However, Khan of Kalat Mir
Suleman Dawood expressed his grievances against CPEC and termed it
as a Chinese project that aimed to take over the whole region. Similarly,
people from Gilgit-Baltistan (GB) protested, under the banner of
Pakistan Peoples Party, against the federal government elucidating that
3
Prime Minister tried to marginalize the region for not taking along the
chief minister of GB to Beijing summit. Nonetheless, president of
another federating unit of Pakistan, AJK, Masood Khan stated in a
seminar in Islamabad that CPEC will steer economic development of
Pakistan and wider region.
The federal government and its officials including ministers tried to not
only raise awareness about CPEC but also to ensure smooth
implementation of CPEC-linked projects. Minister for Planning,
Development and Reforms, Ahsan Iqbal reportedly directed the federal
departments to cooperate with the provincial governments in order to
ensure smooth working on the under-construction projects. The
government also tried to dissolve the impression that Balochistan was
being deprived of its due share in CPEC: Ahsan Iqbal said main benefits
of CPEC go to Balochistan including from Gwadar; Senator Taj Haider
said that the people of Balochistan will be the main beneficiary of CPEC;
PM also said in his meeting with the chief minister of the province that
Balochistan will be the CPECs biggest beneficiary. These claims are
vindicated on the ground that besides the development of Gwadar and
other CPEC projects in Balochistan, telecommunication companies were
reported to have shown inclination to launch their services in 7 districts
of Balochistan.
While CPEC was showcased as a flagship project of Chinese Belt and

Road Initiative at the Beijing Belt & Road Forum (BRF) summit, the
Prime Minister of Pakistan during his address at the summit emphasized
that CPEC offers regional connectivity. However he also firmly asserted
that the politicization of CPEC would not be accepted, with an obvious
reference to the Indian concerns about CPEC. Many other political
leaders and government ministers and officials also highlighted the
CPECs regional integration potential during the month of May 2017,
mainly including Defence Minister Khawaja Asif, Minister of Commerce
4
Khurram Dastgir, the Pakistan Tehrik-i-Insaaf Chairman Imran Khan,

the chief ministers of all four provinces, AJK president Masood Khan,
President of Pakistan Mamnoon Hussain, and Planning Minister Ahsan
Iqbal, among others.
Finance Minister Ishaq Dar declared that government has set aside Rs
180 billion in the federal budget of year 2017-18 for the execution of
CPEC linked projects. A newspaper report said the government has
allocated total Rs44 billion in the financial year of 2017-18 for the
development of western route under the CPEC; under the public sector
development program, a sufficient amount was also allotted for the
execution of eastern route. According to another report, the
government has allocated Rs155-160 billion for the development of
energy and infrastructure related projects under the CPEC. Also,
Rs8,337.243 million have been allocated for eight CPEC-linked railway
projects. The parliamentary committee on CPEC has prioritised 9
priority sites for 9 Special Economic Zones (SEZ) and declared that SEZs
will be set up in all federating units of Pakistan including Gilgit-Baltistan.
During the month under review, daily Dawn published CPEC master
plan, reportedly detailing from original [official] documents. The
revealed document emphasizes Chinas dominating role in the sector of
agriculture and setting up a large surveillance system in cities of
Pakistan. It also envisages visa free entry for Chinese nationals. The
government however discredited the revealed plan terming it absurd
and void.
India did not participate in the Beijing BRF summit, mainly due to its
sovereignty concerns over the CPEC passing through some contested
areas such as Pakistani Kashmir and Gilgit-Baltistan. However Chinese
officials made it clear that CPEC will not change the status of or Chinese
position on Kashmir. Indian media was divided on the Indian decision
5
of not joining the BRF summit; while some supported the decision,
others feared India might weaken its position in emerging geo-
economic alliances as well as larger support for becoming a member of
Nuclear Supplier Group. On the sidelines of a meeting of Asian
Development Bank (ADB), too, Indian Finance Minister opposed CPEC
before his Pakistan counterpart claiming it will hurt their sovereignty.
However, some Chinese, Pakistani and even Indian analysts believed
that India should adopt a realistic approach towards CPEC that has
capability to reinforce the regional integration.
While taking into consideration the regional dynamics of CPEC, foreign

affairs spokesperson from China has noted that stable Afghanistan is
required for the smooth implementation of CPEC. One report claimed
that China, with an aim to advance its strategic and security interests
in the region, will add Afghanistan in its Belt and Road Initiative.
The progress on CPEC-linked projects was noticeable. Some Chinese

researchers visited Pakistan and showed satisfaction over the
development of CPEC projects. CM Sindh has mentioned that three
development projects will be executed in Karachi under the CPEC
shortly. The 2017-18 budget has sufficient allocation for CPEC projects,
as cited earlier. National Accountability Bureau (NAB) has set up the
Standard Operating Procedures (SoPs) and formed a Combined
Investigation Team (CIT) to ensure the transparency of CPEC. The
parliamentary committee on CPEC has prioritised 9 priority sites for 9
Special Economic Zones (SEZ) and urged to set SEZ in all provinces
including GB and the federal region.
A United Nations report stated that CPEC could trigger political

instability between India and Pakistan over geopolitical concerns. An
official of Chinese Foreign Ministry however declared that UN has not
6
conceded any report explicitly on the CPEC and ascertained that CPEC
would no impact on the Chinese stance towards Kashmir dispute.
As far as security is concerned, the two reported attacks on Sindhi

labourers working on CPEC-linked projects in Balochistan were
worrisome. Similarly, two Chinese national were abducted from Quetta
during the month of May. To deal with security concerns of CPEC, the
CM of KP has decided to set an Investment Protection Force (IPF) of
4,000 personnel. Meanwhile, third Chinese-built maritime patrol ship
PMSS Dasht has been installed for the Pakistan Maritime Security
Agency.
7
NATIONAL
PERSPECTIVE ON
B CPEC
1. Politico-Economic The Source
Statements
Minister for Planning, Development and Reforms, Pakistan

Ahsan Iqb al has directed the federal departments to Observer, May
cooperate with the provincial governments in order to 05, 2017
ensure smooth working on the under-construction
projects.
The Finance Ministry and Accountant General of Mehtab Haider,
Pakistan Revenues (AGPR) have criticized the pay The News, May
package of employees hired on contract basis for 06, 2017
execution of the CPEC-linked projects. The AGPR have
opposed the salaries of these contractual employees
under the approved PC-1, ordered to follow pay
package 2009 and cut their salaries up to thirty percent.
Federal Minister for Commerce Khurram Dastgir has
underlined that economic development of Pakistan The News, May
under the CPEC has been improved. 10, 2017
The President of Pakistan Businessmen and
Intellectuals Forum (PBIF) Mian Zahid Hussain has Online
underlined that government need to focus on the International
8
production of solar power by building solar and wind News Network,

parks within its capacity under the CPEC. May 09, 2017
Adviser to the Prime Minister on Foreign Affairs, Sartaj
Aziz stated during his address on a seminar at NUML The Express
that around ten special economic zones will be shaped Tribune, May 11,
to enhance the domestic and international business 2017
activities with some special offer of incentives to the
investors.
Federal Minister for National Food Security and
Research Sikandar Hayat while addressing national The News, May
agribusiness conference on Green Punjab and CPEC in 11, 2017
Lahore said that the surplus revenue of agricultural
industry can be obtained under the banner of CPEC.
The Executive Committee of National Economic Council
(ECNEC) has reviewed the cost of CPEC infrastructure Shahbaz Rana,
project i.e. Gwadar Expressway and agreed upon $168 The Express
million for it despite earlier being agreed on $134.2 Tribune, May 11,
million. 2017
Punjab Chief Minister Shehbaz Sharif in his address to
BRF has lauded Chinese investment in the form of CPEC Pakistan Today,
and ascertained smooth and transparent and May 15, 2107
progressive development of this flagship project.
A media report on publicising the original draft of CPEC
long-term plan has been discredited by the government Usman Mujib
officials for lacking evidence and being void. Some said Shami, Pakistan
it is absurd to publicise the document without bilateral Today, May 15,
[Pak-China] consensus on it. 2017
9
Pakistan People's Party (PPP) Co-chairman Asif Ali Syed Bukhar

Zardari has deliberated that China was well aware of Shah, The News,
the CPEC linked projects corruption. May 16, 2017
Minister for Planning and Development Ahsan Iqbal has Geo TV, May 17,
stated during a talk show that Chinese interests about 2017
CPEC are not in contradiction with the interest of
Pakistan. He further ascertained the transparency of
CPEC.
Prime Minister Nawaz Sharif has underlined during his Xinhua, Global
three-day visit in Hong Kong at the Pakistan Investment Times, May 18,
Forum that CPEC is the key element of Chinese One 2017
Belt One Road (OBOR) initiative. PM underlined that
Pakistan has become an attractive destination for
Foreign Direct Investments (FDI).
Chief Minister Pervez Khatak in conversation with the Dawn, May 19,
community has ensured the development of Shangla 2017
district under the CPEC.
Railway Minister Khawaja Saad Rafique has underlined Shahram Haq,
that around $10 billion investment to improve the The Express
railway infrastructure under the CPEC would not be Tribune, May 19,
sufficient. Around $35 billion would be required to bring 2017
its railway infrastructure in line with the developed
states.
Minister for Planning & Development Ahsan Iqbal said The Nation, May
during a National Excellency Awards distribution 20, 2017
ceremony organised by the Young Engineers Council
that CPEC, a flagship project of OBOR is the manifest
Pak-China friendship. He asserted that in the face of
10
critics, China is committed to the economic

development of Pakistan.
A special advisor to government on the CPEC Drazen Jorgic,
programme Nadeem Javaid has mentioned that CPEC Reuters, May 10,
will be operational by June 2018 and it would 2017
encompass about four percent of global trade by 2020.
Chief Minister Punjab Shehbaz Shari said during his
address to the inaugural session of the second Daily Times, May
international seminar on opportunities of investment 23, 2017
organised by Punjab Board of Investment that CPEC is
capable of stirring up the economic development of
Pakistan and has potential to empower the whole
region. Chinese diplomats who attended this seminar
applauded the role of CM in promoting bilateral
economic cooperation.
Minister for planning and development Ahsan Iqbal has
urged the nation to ignore the falsehood propaganda The News, May
against CPEC. He informed media that CPEC aims at the 22, 2017
socio-economic development of Pakistan and the whole
region.
Minister for Ports and Shipping Mir Hasil Khan Bizenjo
has underscored during at a ship induction ceremony The Nation, May
at the Pakistan Navy Dockyard that Pak-China bilateral 23, 2017
cooperation under the banner of CPEC is notable. He
accredited all bilateral efforts regarding CPEC and
further stressed upon bilateral cooperation for the
politico-economic development of Pakistan.
Punjab Excise and Taxation Minister Mujtaba Rehman
highlighted the CPEC project during the laptop
11
distributing ceremony held at Sheikh Khalifa Public The Nation, May

School. He emphasised that CPEC would help Pakistan 24, 2017
to become a regional power and various CPEC linked
energy projects would curtail the energy crisis of
Pakistan.
At the second International Seminar on investment
opportunities in Punjab, CM Punjab Shehbaz Sharif has
highlighted the decisive role of CPEC in the socio- The Express
economic development of Pakistan and the whole Tribune, May 24,
region and urged the foreign investors in meeting to 2017; Xinhua,
invest in Punjab. Global Times,
May 23, 2017
The Prime Minister stated while talking to Jose Vinals, The Express
the chairman of Standard Chartered Bank that Pakistan Tribune, May 25,
has become a destination market for foreign 2017
investments since the launch of CPEC has accelerated
its economic growth.
President Mamnoon Hussain underlined during the 21st The Express
convocation ceremony of Ghulam Ishaq Khan Institute Tribune, May 26,
of Engineering Sciences and Technology that since the 2017
launch of CPEC, Pakistan has become attractive
destination for FDI. CPEC would open new vistas of
opportunity for engineers so they should be prepared
to join this mega project.
President AJK Sardar Masood Khan stated at a seminar The Express
organized by the Institute of International and Cultural Tribune, May 27,
Affairs on the Belt and Road Initiative: CPEC and 2017;
12
regional integration, in Islamabad that Indian Kashmir Watch,

apprehensions over CPEC are incorrect and misleading. May 26, 2017
Actions and Visits
Planning Minister Ahsan Iqbal in a meeting to gauge the Shahbaz Rana,

development of CPEC projects has strictly instructed the The Express
Federal Board of Revenue (FBR), the countrys tax- Tribune, May 05,
collecting body, to take approval of finance and revenue 2017
ministers before acting against any CPEC related
Chinese firms operating in Pakistan.
Pakistan's ambassador to United Nations (UN) Dr. Muhammad Arif,
Maleeha Lodhi has underlined the prospects of CPEC in Nihao Salam,
a China's Belt and Road Initiative (BRI) exhibition held May 09, 2017
at the UN.
Planning Minister Ahsan Iqbal said that PM of Pakistan The Nation, May
arrived in China for BRF summit with aim to get 13, 2017
approved few infrastructure agreements like the
construction of Gwadar Airport, Gwadar expressway
and up gradation of the railway track ML-1.
Chief Minister Punjab Shehbaz Sharif took off for China The Express
to attend OBOR summit where he would meet Chinese Tribune, May 13,
entrepreneur political bodies to discuss the projects of 2017
shared interests, which will be contributing to the socio
economic development of Punjab.
The State Bank of Pakistan (SBP) has allotted a Farhan Zaheer,
certificate to the Bank of China. This will authorize the The Express
Bank of China to conduct its business activities in Tribune, May 13,
Pakistan. Analysts have reported that this licence from 2017
13
SBP would allow BoC to play a significant role to

finances the CPEC linked projects.
The National Economic Council (NEC) held a meeting Shahbaz Rana,
led by Prime Minister Nawaz Sharif. In the meeting, The Express
NEC decided to earmark Rs180 billion for execution of Tribune, May 20,
the CPEC linked projects. 2017
Finance Minister Ishaq Dar declared that government The News, May
has set aside Rs 180 billion in the federal budget of year 26, 2017; Xuxin,
2017-18 for the execution of CPEC linked projects and Xinhua, May 27,
mentioned that the development programs in 2017
Balochistan region are vital for the execution of CPEC.
The government of Pakistan has allocated total Rs44 Shahbaz Rana,
billion in the financial year of 2017-18 for the The Express
development of western route under the CPEC. Tribune, May 21,
However, under the public sector development 2017
program, a sufficient amount has also been allotted for
the execution of eastern route that is about to
complete.
The parliamentary committee on CPEC has prioritised 9 Asim Yaseen,
priority sites for 9 Special Economic Zones (SEZ) and The News, May
declared that SEZ will be set up in all provinces of 26, 2017
Pakistan including federal areas and Gilgit-Baltistan
(GB) to regulate the local and foreign direct investment.
In budget of fiscal year 2017-18, out of Rs 42,900
million, worth Rs 8,337.243 million have been allocated Daily Times, May
for eight CPEC linked railway projects. 27, 2017
Reports and Analysis
Taking account of the domestic grievances, concerns
regarding tax exemption offered to Chinese and
14
transparency of the CPEC, one official from Planning Afshan Subohi,

commission has stated that domestic concerns need to Dawn, May 01,
be addressed to win the national support for CPEC. 2017
However, the Chinese ambassador Sun Weidong has
ensured that benefits of CPEC would encompass all
aspects of peoples living in Pakistan
Moodys investor service has reported that growing
foreign and domestic investments under the CPEC will
help improve the economy of Pakistan. The News, May
A regional outlook report issued by the International 08, 2017
Monitory Fund (IMF) revealed that foreign direct
investments (FDI) in Pakistan will be increased under The News, May
CPEC that will enhance its economic growth. 10, 2017
An article highlights how CPEC could be linked to
sustainable national development through enlightened
legislation, structural changes in the economy, and Zulfiqar
community participation. Qazilbash,
Moodys report has mentioned that growing imports Dawn, May 09,
under the CPEC have caused trade deficit while former 2017
finance minister Dr Hafiz Pasha has clarified that Shahbaz Rana,
imports under the CPEC-linked projects not the only The Express
reason of trade deficit. Tribune, May 11,
A Reuters report claimed that though CPEC has been 2017
certified for uplifting Pakistans economy, the countrys
financial obligations will peak at around $5 billion in Drazen Jorgic,
2022, according to Pakistans chief economist. Reuters, May 11,
Daily Dawn published what it termed as exclusive 2017
CPEC master plan publicly disclosed for the first time,
reportedly detailing from original [official] documents.
15
The revealed document explains about the Chinese Khurram Husain,

dominating role in the sector of agriculture a much Dawn, May 18,
less emphasized aspect of CPEC thus far and setting 2017
up a large surveillance system in cities of Pakistan. It
also envisages visa free entry for Chinese nationals.
One analyst identifies CPEC as mutually beneficial M. Ziauddin,
project for both China and Pakistan after comparing it Pakistan
with historical economic integration models like Observer, May
Japanese economic expansion of the early nineties and 18, 2017
the US Marshal Plan for Western Europe. He argues that
CPEC stands out because its geographical scope is not
as narrow as of Marshal Plan and unlike Japan, China
offers a wide range of benefits under the CPEC.
A media report presents different opinions on the State
Bank of Pakistans (SBP) revelation of the considerable Farhan Zaheer,
rise of 205% in the current account deficit of Pakistan The Express
for the fiscal year of 2016-17. Some argued the country Tribune, May 18,
is experiencing more outflows than inflows in the wake 2017
of the ongoing construction phase of the China-
Pakistan Economic Corridor (CPEC), which needs heavy
and sophisticated machinery for swift work.
Experts group at the Jang Economic Session on Prime
Ministers visit to China and future of CPCE maintained
that political unanimity and strategic planning are The News, May
imperative to the successful implementation of CPEC. 18, 2017
The group termed Indian concerns on CPEC an outcome
of its enmity with Pakistan.
Prime Minister Nawaz Sharif with all four provincial
Chief Ministers at OBOR Beijing summit is the sign of
16
political unanimity on CPEC. An article explores how it Mansoor Ahmed,

will help the country counter the challenges facing The News, May
CPEC and economic development. 19, 2017
A commentator analyses how improved security, law
and order and foreign investments under the CPEC-
linked projects have aroused the hotel occupancy ratio Amir Shafaat
particularly in the regions of KP and Karachi. Khan, Dawn,
May 21, 2017
Minister for Planning and Development Ahsan Iqbal in Ahsan Iqbal, The
his article tries to respond to what he says false Express Tribune,
information against CPEC. Regarding the Long Term May 25, 2017
Plan (LTP) controversy, he discredits Dawn report and
asserts that final draft of LTP will be broadcast on the
website of CPEC after Chinese approval. He asserts
Pakistan will not be colonised by China, as China does
not have history of imperialism.
One Islamabad-based economist has analysed the Pak- Safiya Aftab,
China agricultural cooperation under the CPEC, mainly The Friday
as reported in Dawn story, and asserted that at the cost Times, May 26,
of the socio-economic consequences for Pakistani 2017
people, it would only cater the agrarian interests of
Chinese at large.
In an interview to the News on Sunday, Planning Waqar Gilani,
Minister Ahsan Iqbal stated that CPEC comprise of The News on
investments, loans and grants and revealed that the Sunday, May 28,
form of soft loans would not add to the debt burden of 2017
Pakistan as these are payable within the period of 30
years. On transparency of CPEC he said that particulars
17
of projects are shared in closed-door consultations at

official level. The Express
The picture of Sahiwal Coal Power Plant, the early Tribune, May 27,
harvest project of CPEC, tweeted by the Punjab 2017
government was questioned on social media with the
allegations of deceiving the nation. The inauguration of
Sahiwal Coal Power Plant was termed fake by Pakistan
Tehrek-e-Insaf (PTI). Farooq Khan,
According to one analysts opinion, energy projects The News, May
under the CPEC would help Pakistan to deal with the 29, 2017
issue of power shortage and that the energy projects
have made the most rapid and visible progress. Dawn, May 1,
A leader of Awami National Party (ANP), Senator Ilyas 2017
Ahmed Bilour, has claimed that the government of
Khyber Pakhtunkhwa (KP) could not fulfil the promise
of regional development and is now deceiving the
people of KP by false demonstrations of signing MoUs
with Chinese entrepreneurs. The Express
Leaders of Pakhtunkhwa Ulasi Tehrik (PUT) have rejected Tribune, May 01,
the assertion of provincial development under the CPEC 2017
that KP Chief Minister has claimed. One stressed that the
region is deprived of its due share in CPEC. Parliament
Senator Taj Haider in his meeting to the members of Times, May 04,
Senate special committee on CPEC underlined that the 2017
people of Balochistan will be the main beneficiary of
CPEC projects. Shafqat Ali, The
Prime Minister Nawaz Sharif held a meeting with the Nation, May 05,
Chief Minister of Balochistan Sardar Sanaullah Khan. In 2017
18
this meeting PM revealed that Balochistan will be the

key recipient of CPEC related projects developments.
Provincial/Regional Developments & Concerns
Dawood University of Engineering and Technology The News, May

(DUET), Jinnah Campus organised a seminar on CPEC 12, 2017
Opportunities and Challenges for Sindh. The faculty
and other speakers at the seminar emphasised upon
the need of commitment for execution of the CPEC,
which would bring socioeconomic development in all
areas of Sindh province.
Chief Minister Khyber Pakhtunkhwa Pervaiz Khattak has The Nation, May
declared that all their grievances regarding the western 12, 2017
route of CPEC have been addressed.
Lots of people from Gilgit-Baltistan (GB) region Imtiaz Ali Taj,
protested against government for what they perceived Dawn, May 16,
as depriving GB of its due share in CPEC. The 2017
protestors under the banner of the PPP (GB) elucidated
that Prime Minister Nawaz Sharif has tried to
marginalise GB by not taking along the chief minister of
Gilgit-Baltistan to the B&R summit in Beijing.
Khan of Kalat Mir Suleman Dawood has expressed his
grievances against CPEC and termed it as Chinese Business
military project that aims to take over the whole region. Standard, May
He deliberated that not only the interests of Bloch 27, 2017
nation, but also of India as well as America are
vulnerable under the CPEC.
Sindh Chief Minister Syed Murad Ali Shah stated during
a press conference on his visit to China, at CM house,
19
that the Chinese wanted to conduct a joint working The Nation, May
group meeting for the approval of Karachi Circular 17, 2017
Railway (KCR), Quetta and Peshawar metro projects of
CPEC while he had offered them to hold meeting in
Karachi.
National Council of Social Welfare (NCSW) arranged a
seminar on Social Impact of CPEC and Vision of OBOR
on Gilgit-Baltistan, where the chairman of NCSW and The News, May
other speakers emphasised that the people of GB would 20, 2017
be the great beneficiary of Belt & Road Initiative under
the CPEC.
Sindh Governor Muhammad Zubair has stated at the
annual convocation of National Institute of Culinary Art
and Hotel Management that hotel business in Karachi The Express
has been rekindled due to improved stability under the Tribune, May 24,
CPEC. He added that hotel industry must be focused as 2017
it is important to rationalise the opportunities under the
CPEC.
The chairman of South Asia Watch and Director
Institute of Kashmir Affairs Dr. Shabir Choudhry has
argued in his article that the execution of CPEC will Financial
bring political and socioeconomic disadvantages to Express, May 09,
people of Gilgit-Baltistan and Balochistan. 2017
20
2. Sociocultural The Source
Statements
Pakistan-China Institute in cooperation with Chinese Dawn, May

embassy organised a lecture on OBOR where 04, 2017
Ambassador Sun Weidong lauded the role of Pakistan
in supporting OBOR. He further ensured that execution
of CPEC would not add to the environmental problems
of Pakistan.
The Xinjiang Yufei International Fishing Co of Chinese The Express
city Karamay has imported 2 tons of seafood over Tribune, May
Gawadar port. The manager of Yufeis Ma Jinglu has 22, 2017
stated that Pakistani seafood will be exhibited in three
days food festival here to promote the import.
Reports and Analysis
A Karachi based scholar and economist has said while Saher Baloch,
addressing the CPEC related seminar that one way to Dawn, May 01,
reap the maximum advantages from CPEC is to train 2017
our domestic labour so the Chinese skilled labour
working on CPEC could be replaced.
Junaid Ashraf,
Shan Foods new advertisement starring a Chinese
Pakistan
couple, which recently went viral on social media, has
Observer, May
contributed to better understanding of each others
03, 2017
socio cultural values. Also, a Canadian born Chinese
actor Kent S Leung made his debut in Pakistani movie
Chalay Thay Saath, which receive huge applause.
Muhammad
Representatives at the Forest Department of Khyber
Sadaqat, Herald,
Pakhtunkhwa have informed that trees will be cut down
May 04, 2017
21
in Hazara division for the smooth implementation of

CPEC. The officials of forest department have
ascertained the plantations of up to 100,000 plants to
compensate the loss of cutting trees along CPEC route.
Salma Butt, The

A youth development expert has anticipated that there
Express Tribune,
is dire need to focus on the human resource
May 06, 2017
development to explore the potential opportunities
under the CPEC. She deliberated that youth
development must be inclusive of mechanical skills.
Imran Ayub,
A media report claims that due to the increasing
Dawn, May 08,
devolvement projects and better security condition
2017
under the CPEC in Balochistan region,
telecommunication companies are inclined to launch
their services in 7 districts of Balochistan.
Deng Xiaoci,
In the wake of OBOR initiative, a Chinese global
Global Times,
navigation satellite system UniStrong Science and
May 17, 2017
Technology Co has set a regional BeiDou Navigation
Satellite system network in Karachi under an agreement
to enhance bilateral aviation and aerospace
cooperation. China now tends to expand its navigation
services around the OBOR states while Pakistan is
marked as a first country in the domain to officially get
into an agreement on BDS.
The University of Veterinary and Animal Sciences The News, May

(UVAS) arranged a consultation for the establishment 23, 2017
of Halal Food Centre under CPEC and gauged
22
suggestions on it from the faculty of UVAS and other

participants who discussed the objectives of CPEC and
various socio-economic and cultural development
program being executed under the flagship project.
Actions/ Visits
A Chinese cultural delegation from the State Council The Nation, May
Information visited Pakistan. During their visit to 07, 2017
Institute of Strategic Studies, Islamabad (ISSI) and
Information Ministry, the delegation underlined the
issues of bilateral concerns. The delegation underlined
that smooth execution of CPEC is linked with the
development of Xinjiang region.
To facilitate the health related activities in Gwadar, the Behram Baloch,
Red-Cross Society of China has invested worth Rs270 Dawn, May 08,
million to build an emergency hospital in the city. In the 2017
inaugural ceremony, Chairman of China Overseas Ports
Holding Company Ltd. said the Red-Cross Society of
China had gifted this hospital to the people of Gwadar.
Sindh Madressatul Islam University (SMIU) Karachi
organised a ceremony to complement its partnership Sindh
with Chinas Hainan Tropical Ocean University and Madrassatul
welcomed the delegation at SMIU. In ceremony, the Islam University,
Vice Chancellor of SMIU has underlined the bilateral May 11, 2017
friendship and role of the CPEC to uphold this rapport.
The University of Management and Technology (UMT)
Lahore has established a CPEC Research Centre to The Express
promote the better understanding of CPEC among Tribune, May 16,
students and promote bilateral business activities by 2017
23
engaging the young entrepreneurs from both sides and

linking the markets.
Chief Minister Punjab Shahbaz Sharif funded the
institution of a fully equipped computer lab at Pakistan The News, May
Embassy College in Beijing. In his conversation with the 18, 2017
staff and students there, CM underlined that benefit of
CPEC are not bound to one province.
An official of the Institute of Business Administration
(IBA), Karachi has revealed that IBA and the Shanghai The News, May
University have signed a memorandum of 26, 2017
understanding (MoU) helping students to graduate in
business finance.
24
3. Security The Source
Statements
The US National Intelligence Director Daniel Coats The Express

informed legislators while addressing in a Congressional Tribune, May 12,
hearing that execution of CPEC would trigger more 2017
terrorism in Pakistan by providing the terrorists some
additional targets to hit.
Federal Minister for Defence, Khawaja Asif has claimed The Express
that terrorist activities in Gwadar and Mastung are Tribune, May 15,
backed by India and anti-Pakistan forces to halt the 2017
execution of CPEC and destabilize the region.
Executive Director of Pakistan Institute of Labour The Nation, May
Education and Research (PILER) Karamat Ali has 15, 2017
condemned the incident of workers killed in Gwadar
and urged the government of Pakistan to ensure the
security of labours employed in sensitive areas.
National Highways and Motorways Police (NHMP) North The Express
Zone Deputy Inspector General (DIG) Abbas Ahsan has Tribune, May 26,
stated that traffic load on highways in north zone is 2017
expected to go higher once CPEC is completed, hence
the government tend to hire around 5,000 new police
officers to maintain this traffic load.
Actions/Visits
Chief Minister Sindh has assigned more 2,000 former The Nation, May
soldiers after dedicating 4,000 policemen to guarantee 11, 2017
the security of Chinese residents. He further revealed
to have set up a special desk at his office as well as at
central police office to ensure the CPEC security.
25
In order to ensure the security of foreign investors Izhar Ullah, The

under the CPEC, Chief Minister KP has decided to set Express Tribune,
up an Investment Protection Force (IPF) of 4,000 May 21, 2017
personnel. He declared that out of 4,000, total 500
personnel will be funded from the current years
budget.
Minister for Ports and Shipping Mir Hasil Khan Bizenjo Financial
has declared that in the wake of security challenges to Express, May 23,
CPEC, third Chinese-built maritime patrol ship PMSS 2017
Dasht has been instated for the Pakistan Maritime
Security Agency (PMSA).
To enhance the security of CPEC linked projects, Qadeer Tanoli,
government has allocated worth Rs1.8 billion in the The Express
budget announced for year 2017-18. Tribune, May 27,
2017
Security Incidents
The militants shot dead around 10 labourers who were Syed Ali Shah,
working at a road in Pishgan region of Gwadar. It was Dawn, May 13,
reported that a Baloch separatist group Baloch 2017
Liberation Army (BLA) accepted the responsibility of
attack on the group of workers. Gul Yusufzai,
Three labourers working on the construction of a Reuters, May 19,
highway linking Gwadar to Quetta, were killed in an 2017
attack reportedly launched by a Baloch insurgent
group.
Two Chinese language teachers including a woman Zafar Baloch,

were abducted from Jinnah Town in Quetta. The The Express
26
abductors surrounded three Chinese workers at Tribune, May 24,

gunpoint but one woman managed to run away. The 2017
kidnappers fired and injured a passer-by person who
tried to intervene in the abduction.
Reports and Analyses
Despite the fact that government has been taken special Madeeha Anwar,
security measures against growing terrorism in Voice of
Balochistan, a security analyst asserted that incidents America, May
of terrorism will continue to affect the execution of 23, 2017
CPEC project. There is a dire need to address the root
cause of extremism i.e. poverty and deprivation of local
inhabitants.
A media report highlights the security urge for Chinese The News, May
nationals after the abduction of Chinese teachers in 26, 2017
Quetta. It also reviews the response of China claiming
that an emergency response mechanism was
approved by the Chinese government in collaboration
with the Chinese Embassy in Pakistan and the Chinese
Consulate General in Karachi.
27
4. Progress on CPEC-linked Projects The Source
Actions/Visits
The government of Pakistan has revealed that all the Muhammad

development projects which are pending including Saleh Zaafir, The
CPEC, will be completed within four hundred days News, May 01,
followed by an .evaluation mechanism to be repeated 2017
after each 100 days.
Chinese Ambassador Sun Weidong has revealed while Daily Times, May
speaking in a seminar that total 19 projects of worth 04, 2017
18.5 billion dollars have been started under CPEC, most
of which are expected to be done by the next year.
Under CPEC, the execution of energy project of 99-
megawatt in Karachi is halted due to inept transmission Zafar Bhutta,
system. Prime Minister Nawaz Sharif has inquired the The Express
matter to fix the issue. The project which was supposed Tribune, May 10,
to be completed last year in September will be done by 2017
June 2017.
Vice President of China National Electric Engineering Co
Ltd (CNEEC) Wu Guisheng has declared to build The Express
Rashakai Special Economic Zone (SEZ) in KP, which will Tribune, May 10,
start in June (2017). It will be the first industrial park 2017
under the CPEC.
Bilateral deals of around $500 million were signed
between China and Pakistan ahead of BRF summit in Aamir Ilyas
Beijing. It includes worth $333 million for the Rana, The
construction of Gwadar airport and Havelian Dry Port, Express Tribune,
and another $160 million agreement for the East Bay May 13, 2017
Expressway linking Gwadar to Pakistans existing
highway system.
28
The board of directors of Pakistan Steel Mills (PSM)

greed to 1,500 acres of its land for the manufacture of Shahbaz Rana,
an industrial zone under the CPEC while autonomous The Express
auditors will set the prices. Tribune, May 13,
Minister of Planning and Development has informed the 2017
National Assembly that three CPEC linked infrastructure Atif Kahn &
road projects are expected to be completed in next two Nokhaiz Sahi,
years while energy projects of worth $2227 million The Nation, May
would not be executed under the IPP mode. 18, 2017
Khyber Pakhtunkhwa government has signed a deal of
worth $11 billion development projects under the CPEC
with the Frontier Works Organisation (FWO). According The Nation, May
to KP chief minister these projects include the 23, 2017
establishment of Model Housing Town in Peshawar,
CPEC city on Motorway near Swabi and setting up 3
hydro power plants in Chitral.
Naval Air Station in Turbat has become operational.
Defence Minister Khawaja Asif stated during the
inaugural ceremony that the Air Station will endorse the Dawn, May 25,
smooth execution of CPEC projects. 2017
In budget of fiscal year 2017-18, out of Rs 42,900
million, worth Rs 8,337.243 million have been allocated
for eight CPEC linked railway projects. Associated Press
of Pakistan, May
26, 2017
Statements
29
Political and Press Counsellor at the Chinese Embassy Dawn, May 02,
Jian Han, speaking at a roundtable conference on 2017
OBOR and CPEC from the Prism of China-Pakistan
Bilateral Relations organized by the Strategic Vision
Institute (SVI), said that the [CPEC] long-term plan,
which both sides are preparing, would set the focus
for CPEC construction in future.
Chief Minister Sindh Syed Murad Ali Shah said in his The News, May
address at the launch of the Chinese consul generals 11, 2017
documentary on Pakistan-China friendship that as a
part of CPEC, the Karachi Circular Railways (KCR)
project will be commenced by end of this year.
Chief Minister Sindh has revealed that three projects of The Nation, May
Karachi including Circular Railway, China Special 11, 2017
Economic Zone at Dhabeji, and Keti bandar Power Park
will be added into CPEC shortly.
Sindh Chief Minister Syed Murad Ali Shah has said while The Express
addressing a press conference after his visit to China, Tribune, May 17,
at CM house, that execution of KCR as a part of CPEC 2017
is expected to begin by September this year or it could
be delayed until December.
The Project Director of CPEC Hassaan Daud has Associated Press
underlined while talking on CPEC Threats and of Pakistan, May
Opportunities at National Management Institute, 24, 2017
Karachi that execution of various power and
infrastructure projects under the CPEC is likely to be
done this year that will contribute to the viable
economic development of Pakistan.
30
During the inaugural ceremony of a CPEC-linked coal Salim Ahmed,

power project in Sahiwal, Chief Minister Shehbaz Sharif Pakistan
appreciated the role of PML-N government in the Observer, May
economic development of Pakistan. He further 25, 2017
expressed his gratitude to the Chinese government and
Chinese nationals for endorsing Pakistans economic
growth in the form of CPEC initiative.
A report claims that the government of Pakistan aimed Fawad Yousafzai,
to include Diamer-Bhasha Hydro Power project in the The Nation, May

08, 2017
CPEC Long Term Plan (LTP).
Manzoor Ali,
According to a media report, the draft of the CPEC Long
Dawn, May 12,
Term Plan, as revealed by daily Dawn, shows that the
2017
project will be in primary shape by 2020.
Mehtab Haider,
It is reported that in budget 2017-18, the government
The News, 13
of Pakistan has allocated Rs155-160 billion for the
May, 2017
development of energy and infrastructure related
projects under the CPEC.
A report claimed a total 5 CPEC related energy (coal) Fawad
projects of 3470 Megawatt have been shelved with Yousafzai, The
mutual consent, mainly due to their feasibility issues Nation, May 19,
while both sides tended to add other viable energy 2017
projects to sustain the installed capacity of CPEC.
The News reported that under the umbrella of CPEC The News, May
projects, 27 trains designed for Lahores Orange Line 22, 2017
Metro project will be delivered by a Chinese company
to the Punjab government authorities by the end of the
year 2017. One of these will reach Lahore in July.
31
A newspaper article argues that though the Economic Z Ali, The

Survey 2016-17 shows development in agricultural Express Tribune,
sector under CPEC, the compressed budget allocated May 28, 2017
for the CPEC-linked agricultural projects could not
sustain that development. It asserts that the federal
and provincial government should cooperate on
developing the strategic policies to promote the
agricultural linkages with CPEC.
A report analyses the potentially positive impact of Shiab Ur Rehman
good allocation in the budget 2017-18 for the Port Siddiquie,
and Shipping Development Programs to help complete Business

Recorder, May 26,
CPEC-related projects.
2017
32
BILATERAL
(PAK-CHINE)
C PERSPECTIVE
1. CPEC The Source
Statements
Ambassador Sun Weidong stated in his meeting with Saeed Ahmed,

the President of the Federation of Pakistan Chambers The News, May
of Commerce and Industry (FPCCI) that growing Pak- 01, 2017
China bilateral relations would have valuable impact for
socio-economic development of the whole region. Farooq Awan,
The Director at the Institute of China's Borderlands has Daily Times,
underscored significance of CPEC in promoting bilateral may 05, 2017
relations in different dimension.
Chairman China-Pakistan Friendship Association Sha Pakistan
Zukang has underlined the CPEC as a game changer Observer, May
project and stressed upon its potential of regional 12, 2017
connectivity. He stated that the economic development
of Pakistan under the CPEC has been accelerated.
Qamar Zaman Chaudhry, Chairman of the National
Accountability Bureau (NAB) has declared that to avoid The Express
corruption and enhance the transparency of execution Tribune, May 07,
mechanism of CPEC, a Combined Investigation Team 2017
(CIT) and Standard Operating Procedures (SOPs) have
been framed under the NAB.
33
1. CPEC The Source
The representative of Chinese Foreign Ministry Hua The News, May

Chunying has underlined that Chinese stance on 18, 2017; Daily
Kashmir dispute is same even after the launch of CPEC Times, May 19,
and expected the bilateral issue to be solved by India 2017
and Pakistan in a peaceful way.
Actions and Visits
A Chinese business delegation led by the Secretary The News, May

General of Worldwide Business Culture Exchange 24, 2017
Centre Ling Yaqing visited the Federation of Pakistan
Chambers of Commerce and Industry (FPCCI).
Delegates from both sides stressed to enhance bilateral
economic relations.
Secretary of the Jiangxi province Lu Xinshe had a The Express
meeting with Chief Minister Punjab Shehbaz Sharif in Tribune, May 09,
Lahore where he lauded the role of CM for the 2017
successful execution of development projects in
Punjab. Both encouraged the economic cooperation
among provinces of Punjab and Jiangxi.
Two researchers from the Chongyang Institute for Pakistan

Financial Studies at Renmin University of China Observer, May
conducted a survey in Pakistan to gauge the pace of 09, 2017
progress of the CPEC. They have reported notable
progress of various energy and infrastructure related
projects under the CPEC.
34
2. Bilateral Cooperation The Source
Statements
Sindh Chief Minister Syed Murad Ali Shah highlighted The Nation, May
11, 2017
the strength of Pak-China bilateral relations during his
presidential address at an event in Karachi. Upholding
the significance of CPEC, he termed it a long-term
development project and claimed that both states
have been enjoying long diplomatic relations.
Official Visits/Exchanges
A roundtable conference was held at Islamabad where

a delegation of the Publicity Department of the The Express
Xinjiang Autonomous Region Committee expressed its Tribune, May 05,
willingness to grow its economic relations with 2017
adjacent countries, including Pakistan.
35
REGIONAL /
INTERNATIONAL
D DYNAMICS
1. On CPEC and Connectivity The Source
Statements/Concerns
On the sidelines of a meeting of Asian Development The Express

Bank (ADB), Finance Minister of India and Pakistan Tribune, May 06,
expressed their views discussing OBOR. The Finance 2017
Minister of Pakistan supported the Chinese initiative
and stressed upon the regional connectivity offered by
the OBOR while Finance Minster of India opposed
claiming it will hurt their sovereignty.
Finance Minister Ishaq Dar participated in a debate Daily Times, May
organised by CNBC and ensured Pakistans support for 07, 2017
OBOR. He further deliberated that CPEC under OBOR
will endorse the regional economic cooperation among
China, Pakistan, India, Iran and Afghanistan.
The Chairman Pakistan Tehreek-i-Insaf Imran Khan Dawn, May 07,
explained in a Digital Youth Summit held at Khyber 2017
Pakhtunkhwa (KP) that Pakistan can take all the possible
advantages from CPEC by maintaining good relations
with states like India, Afghanistan and Iran, and
addressing the issue of political leadership.
Adviser to Prime Minister on Foreign Affairs Sartaj Aziz
has said in a meeting with Foreign Minister of Oman
36
Yousaf Bin Alawi that bilateral relations could be Mariana Baabar,

enhanced with the cooperation under CPEC mainly in The News, May
maritime interfaces, airports and seaports linkages. 09, 2017
Chinese investment in Pakistan under the banner of Kashif Hussain,

CPEC has become source of attraction for the investors The Express
across the region. Pakistans Consul General Nadeem Tribune, May 12,
Ahmed has informed media that investors of German 2017
private companies have shown their interest in CPEC.
The Prime Minister of Pakistan during his address at
Belt Road Forum (BRF) summit in Beijing clarified that Muhammad
CPEC offers regional connectivity and firmly asserted Saleh Zaafir, The
that the politicization of CPEC would not be acceptable. News, May 15,
It was an obvious response to the grave concerns of 2017
India toward CPEC. He further underlined that CPEC is
free from geographical limitations.
PM Nawaz Sharif has decisively asserted while returning
from OBOR summit that Pakistans bilateral relations Sana Rashid,
with the US will not be affected by the implementation Pakistan
of CPEC. Observer, May
President Xi Jinping has underlined at the BRF summit 16, 2017
in Beijing that China will adhere to five principles of
peaceful coexistence for effective execution of the Belt Atul Aneja, The
and Road initiative. A spokesperson from Chinese Hindu, May 18,
foreign ministry Hua Chunying further reiterated 5Ps to 2017; Times of
address the Indian concerns regarding the CPEC, a India, May 18,
flagship project of OBOR. 2017
37
President Azad Jammu and Kashmir (AJK) Sardar

Pakistan
Masood Khan has highlighted that CPEC will endorse the
Observer, May
economic development of its adjacent states in the
26, 2017
region. He was addressing at a seminar organized by the
Institute of International and Cultural Affairs in
Islamabad titled Belt and Road Initiative: CPEC and
regional integration.
Actions/Visits
China has urged India to not fuel its doubts against the First Post, May
military development of China and execution of the 08, 2017
CPEC, a flagship project of OBOR.
In the backdrop of Indias reservations for CPEC Financial
because of sovereignty issues, Chinese envoy to India Express, May 08,
has stated that their government is ready to change the 2017
name of CPEC to promote the bilateral relations.
Indian media has reported that Chinese Embassy has First Post, May
omitted its ambassadors statements of renaming CPEC 09, 2017
from the speech he made at an Indian think tank.
Minister of Commerce Khurram Dastgir Khan
highlighted during his visit to Qatar the significance of Irfan Bukhari,
CPEC and informed Qatars Minister of Economy and The Peninsula,
Commerce about regional connectivity of CPEC that May 09, 2017
offers mutual prosperity.
A Chinese envoy to India Luo Zhaohui offered India to be
a part of CPEC. He made this offer during his address at The Express
the United Services Institute where he emphasised on Tribune, May 09,
promoting bilateral relations and ensured that CPEC has 2017
no links with the sovereignty of states involved.
38
The first round of the Practical Cooperation Dialogue

between China, Pakistan and Afghanistan held in Beijing Afghanistan
where three sides agreed to cooperate to enhance the Times, May 28,
regional economic integration. 2017
Media Reports and Analysis MK

An Indian journalist has written that China is expected Bhadrakumar,
to take CPEC to the front of the Shanghai Cooperation The Tribune,
Organization (SCO) to promote the multipolar world May 01, 2017
order and regional security.
An Indian newspaper reported that for the peaceful The Hindu
implementation of CPEC, China would play the role of a Business Line,
regional stabilizer particularly resolving tension May 02, 2017
between India and Pakistan over Kashmir dispute.
Outlook India reported that scores of Kashmiri people Outlook India,
protested outside the UN office in Srinagar against May 04, 2017
Pakistan government's decision to declare Gilgit-
Baltistan (GB) a fifth province while Indian media has
been projecting that this decision has been taken to
support the smooth execution of CPEC.
A senior research fellow at the S. Rajaratnam School of James M.
International Studies has anticipated that the Dorsey, May 05,
government of Saudi Arabia has perceived the launch 2017
of CPEC and Chabahar initiative as a threat that would
accelerate the Saudi-Iranian conflict in the region.
A News on Sunday report claimed that fascinated by Waqar Gilani,
the regional connectivity offered by CPEC, the Swiss The News on
Business Council (SBC) has urged European Investors Sunday, May 07,
to explore the potential trade benefits under the CPEC. 2017
39
A Chinese analyst argued that regional connectivity Liu Jianxi, Global

projects could support Indias ambitions. Therefore, Times, May 07,
instead of conflicting with the economic rise of China 2017
under the CPEC, India needs to deal with the CPEC, and
China and Pakistan, sensibly and realistically.
A Voice of America report quoted director research at Saibal Dasgupta,
Beijing-based China Policy firm, David Kelly, as saying Voice of
that with aim to advance its strategic and security America, May
interests in the region, China will add Afghanistan in its 08, 2017
Belt and Road Initiative (BRI).
A national analyst has argued in an article that as Amir Husain,
execution of CPEC could be concerning for some states The News, May
like India, UAE and Saudi Arabia, Pakistan should adopt 10, 2017
a strategic policy to take advantage of the CPEC without
hurting its diplomatic regional engagement.
A Guardian report quoted a Chinese entrepreneur Zhou
Jun claiming that Chinese BRI will not only make China The Guardian,
great but also has potential to stir development at May 12, 2017
regional level, transforming the economic outlook of
South Asian states.
An article by a senior journalist explains how Minister
and Deputy Chief of mission at the Embassy of China in M Ziauddin, The
India Liu Jinsong has tried to clarify Indian doubts Express Tribune,
regarding the CPEC in a logical way by presenting six May 13, 2017
solid reasons which invalidate Indian concerns over
CPEC.
The Hindu analysed that it was due to the sovereignty
concerns over the execution of CPEC that the
40
government of India was not sending its The Hindu, May

representatives to the Belt Road Forum (BRF) summit 14, 2017
being held in China.
In his article in Indian Express, Professor of Chinese
Studies in the Jawaharlal Nehru University Srikanth
Kondapalli fears that India's opposition of CPEC might Srikanth
be one of the reasons that China will resist its support Kondapalli, The
for India's entry into the Nuclear Suppliers Group Indian Express,
(NSG). May 15, 2017
An Indian analyst has projected that the construction
of CPEC-linked dams like Bunji and Basha in the
disputed territory of Gilgit-Baltistan (GB) would have Brahma
the greater impact on bilateral Pak-India water Chellaney, Times
relationship. of India, May 16,
Based on the Dawn report on CPECs long-term plan, 2017
The Times of India compared CPEC with East India
Company and assumed that under the umbrella of Times of India,
development projects, China aimed to colonize the May 16, 2017
whole region.
Hindustan Times critically commented on an editorial
published in a Chinese state-led daily newspaper; the
editorial had said Indias shallow and stereotypical Sutirtho
views led to its boycott of Belt and Road Forum in Patranobis,
Beijing. Hindustan
An editorial in New York Times mentioned that some Times, May 16,
delegates at OBOR summit were concerned about the 2017
large Chinese investment based on geopolitical The New York
priorities. It said investment plan should be Times, May 18,
commercially feasible because the repayment of the 2017
41
loan to Chinese companies would be difficult for states

like Pakistan and Afghanistan.
A United Nations report specified the fear that CPEC will
trigger political instability between India and Pakistan
over geopolitical concerns. The report was prepared by Dawn, May 24,
UNs Economic and Social Commission for Asia and the 2017
Pacific (ESCAP) in order to gauge the execution of 6
economic corridors under the banner of belt and road
initiative.
Taking note of the UNs report, which claimed CPEC
would promote the regional political instability, an
The News, May
official of Chinese Foreign Ministry has declared that UN
26, 2017
has not conceded any report explicitly on the CPEC and
ascertained that CPEC would have no impact on the
Chinese stance towards Kashmir dispute.
42
2. Regional Dynamics of CPEC Security The Source
Statements
The representative of Ministry of Foreign Affairs of Saibal Dasgupta,
China has showed concerns for Pak-Afghan border Times of India,
dispute due to regional connectivity of the CPEC. May 08, 2017
Media Reports and Analysis

A Pakistani analyst has reported that peace and stability Imtiaz Gul, Daily
in Afghanistan are essential for the effective Times, May 08,
implementation of CPEC. 2017
Pakistans defence circles, including officials linked to Mian Saifur
the security and development of CPEC, have lauded the Rehman, The
Finance Ministers unflinching support of OBOR against News, May 08,
the strong Indian opposition. 2017
A report analysed how Pakistan was making efforts to The Nation, May
enhance its naval competence and maritime security in 16, 2017
order to counter Indian challenges raised up after the
launch of CPEC.
According to Indian media, Shi Zhiqin, executive dean Sutirtho
of the newly opened One Belt, One Road Strategic Patranobis,
Institute in Beijing has affirmed that the reality of Hindustan
growing political, cultural and security threats to the Times, May 07,
CPEC cannot be ignored. 2017
43
E ANALYSIS
Political Development
Despite the fact that progress on CPEC-linked projects is evident and

being monitored by the federal government, there are certain domestic
and regional political challenges, which could affect the smooth
implementation. On domestic front, these mainly include: continuing
grievances and concerns of some communities about CPEC, mainly in
Gilgit-Baltistan and Balochistan; the issue of transparency of CPEC
projects and progress; financial issues mainly linked to repayments of
CPEC loans; concerns about the CPEC ignoring the development of local
industry and human resource; and security of CPEC-linked projects and
workers including Chinese nationals. In different instances during the
month under review, these and similar other issues were recorded, which
need the governments immediate attention.
On the whole, most in Pakistan see CPEC as a game changer for economic
development of the country and its connectivity with the wider region.
However various political, economic and security challenges, as cited
earlier, seek to undermine its execution and impact. Dynamics of domestic
and regional concerns cannot be ignored for the project will not be
completed in space but on the ground.
44
Keeping rhetoric aside, the government should try to seriously address

the concerns of those raising questions on the sustainability of the
repayments for loans being acquired for CPEC projects. It is also not
appropriate to turn a blind eye to the domestic grievances, although an
improved environment of consensus has recently been emerging. The
nationalist sentiments in GB and Balochistan could be termed as more
emotional than factual but the government has the responsibility to
address them. It is also pertinent that the government focuses on the
community participation and link CPEC to the development of indigenous
human resource as well as local industry.
Project Implementation and New Initiatives
The federal government will use both specially allocated funds in the
budget for CPEC as well as PSDP funds to execute the CPEC projects.
Some analysts believe the government should also prioritise agriculture
sector in CPEC projects; this debate strengthened particularly after the
Dawn report revealed China had special consideration for engaging in
Pakistans agribusiness.
Apart from finances, another main issue in the timely execution of CPEC
projects has been bureaucratic or departmental hurdles and lack of
coordination between Islamabad and provinces. The government was still
struggling towards that end. During the month under review, Planning
Minister Ahsan Iqbal directed federal departments to cooperate with
provincial governments and also instructed the FBR, the countrys tax
collecting body, to take approval of finance and revenue ministers before
acting against any CPEC-related Chinese firm operating in Pakistan.
Meanwhile, a bilateral deal of worth $500 million was signed ahead of BRF
summit to stimulate the development of CPEC projects. It includes worth
45
$333 million for the construction of Gwadar airport and Havelian Dry Port,
and another $160 million agreement for the East Bay Expressway linking
Gwadar to Pakistans existing highway system.
Regional Context
Chinas Belt and Road Initiative (BRI) is attracting ever more regional and
global attention and reactions after the Belt and Road Forum summit was
held in Beijing. Also, after the summit, not only has Pakistan become more
enthusiastic about the execution of China-Pakistan Economic Corridor, but
many countries have started to see Pakistan as a promising investment
place. At the same time, China and Pakistan have been using the BRI and
CPEC as geo-economic connectors, which has implications for emerging
political as well as geostrategic alliances in the Asian and Eurasian regions.
However in that wider context, the immediate challenges emerge from
the Pakistans and Chinas immediate neighbourhoods.
Some developments during the month under review suggested that both
China and Pakistan wanted Afghanistan to become part of regional
connectivity offered by CPEC. For both Pakistan and China, this
connectivity with Afghanistan is as important for CPEC and BRI projects
themselves as for providing a safe and secure environment to the
execution of these projects. In last week of May, the first round of the
Practical Cooperation Dialogue between China, Pakistan and Afghanistan
was held in Beijing where three sides agreed to cooperate to enhance the
regional economic integration.
However Indian opposition to CPEC and its close ties with and influence
in Afghanistan offer the main challenge in that regard. It is not that China
and Pakistan do not want India to become part of this regional
connectivity initiatives, rather its India which feels its sovereignty will be
affected by doing so; Indias greater geostrategic alliance with the U.S.
46
and a desire for regional hegemony are other predicaments. India did not
participate in the Beijing BRF summit, mainly on the same grounds.
Iran is also an important country in this scheme of regional

connectedness. While Pakistan has offered Iran to become part of CPEC
Iran has also at time showed willingness for China however Iran is
important for bilateral engagements in terms of trade and economy as
well as for the success of Chinese BRI initiative across Central Asia and
beyond. According to a research report published during the month under
review, CPEC and Gwadar Port along with Iranian Chabahar could
instigate regional conflict particularly increasing tension between Saudi
Arabia and Iran. At present, Pakistan is also finding it difficult to sustain
a traditional policy of balancing its ties with Saudi Arabia and Iran,
particularly after it started to support the Saudi-led counterterrorism
military alliance.
CPEC Security
At the same time endangered security of CPEC workers should be a matter

of real concern for the government. Some steps were taken in that regard
during the month under review, as cited in Overview, but not a single
news or report emerged about the development or operations of the
Special Security Division (SSD), which was being raised for CPEC security.
On the whole, the security environment of the country has shown signs
of relative improvement. But there are areas where CPEC projects and
workers are relatively more vulnerable such as Balochistan. Special
security arrangements are needed for those areas besides taking up the
task of CPEC security across Pakistan seriously.
(Note: This report is compiled by the Senior Research Analyst Safdar Sial and
Research Associate Anam Fatima, at Pak Institute for Peace Studies (PIPS),
Islamabad.)
47

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May 2017

A review of national, bilateral

B NATIONAL PERSPECTIVE ON CPEC

In the month of May 2017, there were several indicators of

While CPEC was showcased as a flagship project of Chinese Belt and

Khurram Dastgir, the Pakistan Tehrik-i-Insaaf Chairman Imran Khan,

While taking into consideration the regional dynamics of CPEC, foreign

The progress on CPEC-linked projects was noticeable. Some Chinese

A United Nations report stated that CPEC could trigger political

As far as security is concerned, the two reported attacks on Sindhi

Minister for Planning, Development and Reforms, Pakistan

1. Politico-Economic The Source

production of solar power by building solar and wind News Network,

1. Politico-Economic The Source

Pakistan People's Party (PPP) Co-chairman Asif Ali Syed Bukhar

1. Politico-Economic The Source

critics, China is committed to the economic

1. Politico-Economic The Source

distributing ceremony held at Sheikh Khalifa Public The Nation, May

1. Politico-Economic The Source

regional integration, in Islamabad that Indian Kashmir Watch,

Actions and Visits

Planning Minister Ahsan Iqbal in a meeting to gauge the Shahbaz Rana,

1. Politico-Economic The Source

SBP would allow BoC to play a significant role to

1. Politico-Economic The Source

transparency of the CPEC, one official from Planning Afshan Subohi,

1. Politico-Economic The Source

The revealed document explains about the Chinese Khurram Husain,

1. Politico-Economic The Source

political unanimity on CPEC. An article explores how it Mansoor Ahmed,

1. Politico-Economic The Source

of projects are shared in closed-door consultations at

1. Politico-Economic The Source

this meeting PM revealed that Balochistan will be the

Provincial/Regional Developments & Concerns

Dawood University of Engineering and Technology The News, May

1. Politico-Economic The Source

2. Sociocultural The Source

Pakistan-China Institute in cooperation with Chinese Dawn, May

Reports and Analysis

2. Sociocultural The Source

in Hazara division for the smooth implementation of

Salma Butt, The

The University of Veterinary and Animal Sciences The News, May

2. Sociocultural The Source

suggestions on it from the faculty of UVAS and other

2. Sociocultural The Source

engaging the young entrepreneurs from both sides and

3. Security The Source

The US National Intelligence Director Daniel Coats The Express

3. Security The Source

In order to ensure the security of foreign investors Izhar Ullah, The

Two Chinese language teachers including a woman Zafar Baloch,

3. Security The Source

abductors surrounded three Chinese workers at Tribune, May 24,

Reports and Analyses

4. Progress on CPEC-linked Projects The Source

The government of Pakistan has revealed that all the Muhammad

4. Progress on CPEC-linked Projects The Source

The board of directors of Pakistan Steel Mills (PSM)

4. Progress on CPEC-linked Projects The Source

4. Progress on CPEC-linked Projects The Source