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Questions on CPEC
Opinion Anjum Altaf (https://www.thenews.com.pk/writer/anjum-altaf) March 19, 2017

Has there been a fruitful line of inquiry regarding the China-Pakistan Economic
Corridor (CPEC)? This largely depends on the questions with which one initiates
the inquiry.

Will CPEC be a game-changer for Pakistan? This drawing-room question is

particularly useless to begin with. With so much uncertainty and so many
variables beyond human control, no one except a clairvoyant can predict this with
any con dence. It is just as pointless – if not downright silly – to take sides. There
is not enough information available for one side to convince the other on the basis
of analysis. Believers will continue to believe and sceptics will continue to doubt
for reasons which have little to do with the intricacies of the initiative.

The following questions pertaining to the details of the deal are more useful:
Under what conditions are the various components of the initiative being
negotiated? What are the nancial obligations and terms of repayment? What tax
concessions are being o ered? What are the revenue and capital cost projections
of the various components? Who will bear the operating and maintenance costs?

Citizens responsible for the debt liabilities have a right to demand this
information and expect it to be provided. What are the reasons for the secrecy?
What is there to hide? The numbers that are ltering out in dribs and drabs on
guaranteed rates of return are not particularly reassuring. The mere fact that
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information is not being fully shared is a major cause for doubt. People are
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from an information overload. For example, it includes the Karachi Circular
Railway, the Peshawar Mass Transit, the Quetta Mass Transit and the Lahore
Orange Line Metro Train projects.

These are all plausible projects with individual justi cations and may all involve
Chinese funding. But what do they have to do with the corridor? It appears that
various stakeholders are being appeased by including their pet projects under the
CPEC umbrella.

The case with the power projects listed on the website is similar. Each might be
justi ed but why is a wind farm in Bhambore lumped under CPEC? Wouldn’t it
make more sense to treat them as independent projects with separate feasibility
studies, as is the norm? The indiscriminate lumping together of everything
happening in the country is another red ag regarding the coherence of the
initiative.

It would help to strip out the core corridor investments and share details of their
nancing and cost-bene t projections. It is reasonable to expect that, barring
unforeseen events, a functioning corridor would be bene cial for China. But what
will be in it for Pakistan except collecting a toll on the transit trade? How much
toll collection is being projected? What will Pakistan be exporting via the corridor
given its grossly uncompetitive economy? Why would industrial estates succeed
along the isolated corridor when they have failed in major locations like Peshawar
and Quetta? How many permanent jobs are expected to be created? These are
legitimate questions that need to be answered in order to build consensus and
take citizens into con dence.

It is not enough for the government to expect the public to trust its judgement
because governments in Pakistan have done nothing to earn that trust. Neither
international agencies nor Pakistani citizens believe that successive governments
have been forthcoming about facts. Such behaviour is not unique to Pakistan.
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After all, Bush and Blair lied to their citizens to invade Iraq.
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CPECCPEC of honest answers, those without vested interests in deal-making
In the absence
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canon-only point
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one of the most signi cant trade corridors of recent times: the Suez
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a game-changer for the people of Egypt? Or, let’s take the examples
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of game-changers for Pakistan that were promised in the past – such as Thar Coal,
Saindak and Reko Diq. Incidentally, all these projects were also based on Chinese
involvement. Why did they not reap the desired impact? They certainly changed
the game for those involved in the multiple transactions for the projects. But did
they bring any bene ts for the people of Pakistan or even the locals who lived
near the project sites?

The attempt to turn such questioning into issues of patriotism or of maligning our
best friends strengthens the impression that all is not aboveboard. These are the
standard tactics of those who wish to divert discussion from facts and sti e
inquiries through intimidation. Under normal circumstances, citizens would be
within their rights to examine the track record of Chinese investments in other
countries like Sri Lanka (Google Hambantota) or prior deals with Pakistan such as
the railway locomotives. In all such cases, the Chinese are not to blame – ‘buyers
beware’ is rule of the market. The concern is with those negotiating the deals on
our behalf and the question remains the same: Do you trust them? If so, on what
basis?

Given the lack of transparency and the historical evidence, the following
outcomes appear likely: For better or for worse, the CPEC momentum is
unstoppable. It will be bene cial for the Chinese economy. It will generate toll
revenues for Pakistan which may be more or less than the operating costs
depending upon contractual terms, much as for the Lahore-Islamabad motorway.

Without inclusiveness, the economic gains of CPEC might be outweighed by

political stresses. The corridor will de nitely change the fortunes of a few
thousand individuals in Pakistan. It is unlikely to be a game-changer for the
Pakistani people – just as the Suez Canal did not alter the fate of the Egyptians. On
the other hand, this could be the mother of all miracles. Let us bow our heads and
pray while the untethered camel wanders into Kashgar.
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writer is a fellow at the Consortium for Development Policy Research
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