CHINA PAKISTAN ECONOMIC CORRIDOOR

PRESTENTED BY WALEED BABAR

B-COM PART 2
 INTRODUCTION

• CEPEC is a 3000 km Chinese infrastructure network project undertaken in

Pakistan. This sea-and-land based corridor is aimed to secure and reduce the
passage for China’s energy imports from the Middle Eastern countries by
avoiding existing route from the Straits of Malacca between Malaysia and
Indonesia.Pakistani officials predict that CPEC will result in the creation of
upwards of 2.3 million jobs between 2015 and 2030, and add 2 to 2.5
percentage points to the country's annual economic growth. As of 2022, it has
enhanced Pakistan’s exports and development capacity and is providing 1/4th
of total electricity.
 DEFINATION :
China-Pakistan Economic Corridor (CPEC), massive bilateral project to
improve infrastructure within Pakistan for better trade with China and to further
integrate the countries of the region. The project was launched on April 20, 2015
IMPORTANCE OF CEPEC:
• The China-Pakistan Economic Corridor (CPEC) is more than just a $47 billion dollar
investment. It will not only improve Pakistan’s current situation, but promises to
improve the lives of nearly three billion people across the region as part of the larger
Chinese vision of a grand Silk Road Economic Belt, which stretches across Asia
through the Middle East and connects to Europe. He estimated that the initial
investment of $47 billion will be generating up to 3 or 4 times more! New job
opportunities and new businesses will be established by this corridor. That’s the
reason some of our neighbor countries are not happy with the importance of CPEC
for Pakistan.
 PHASES OF CRPEC:
The CPEC projects in Pakistan are divided into three phases. Pakistan has already set
up early harvesting projects like power production plants under phase-I by 2020. It
would develop medium-term projects under phase-II by 2025 and long-term projects
under phase-III by 2030.
 By 2020, the CPEC strives to take the initial shape, major bottlenecks of
Pakistan's economic and social development shall be addressed, and the
CPEC shall start to boost the economic growth along with it for both
countries," according to Long Term Plan for CPEC (2017-2030).
 The long-term plan is approved by both the Pakistani and Chinese
governments.

 By 2025, the CPEC aims for: industrial system approximately complete,

major economic functions holistically brought into play, the people’s livelihood
along the CPEC significantly improved, regional economic development more
balanced, and all the goals of Vision 2025 achieved, according to the long-
term plan.
 By 2030, CPEC strives to be entirely accomplished, have the endogenous
mechanism for sustainable economic growth in place, the CPEC’s role in
stimulating economic growth in Central Asia and South Asia brought into
holistic play, and South Asia shall grow into an international economic zone
with global influence, it added.
BENEFITS OF CEPEC:
 1. Quaid-e-Azam Solar Power Park Bahawalpur – The Largest Solar
Power Plant: The 100MW Solar Power Park in Bahawalpur has generated
not just jobs but the cleanest and the most reliable source of energy to
Pakistan, thanks to the collaboration of the governments of China and
Pakistan. This unique solar project, is the biggest solar producer in Pakistan
and has surpassed its intended energy production by 4.42 % in 2015-2016
and 5.48 % in 2016-2017 .

 2. $4.8 Billion is being spent by China in developing Gwadar to be the

busiest shipping port in South Asia by 2022: Gwadar has become a major
global port city and will be the gateway of trade for the continent, linking
China with markets in Central and South Asia. Over 500,000 professionals
are expected in the city by 2023.
3. Lahore Line Metro Train: Lahore Line Metro Train promises to connect
the vast city of Lahore from one end of the city to the other end. A One-Of-A-
Kind project, funded by China, this train line will drastically improve
Pakistan’s infrastructure and will cater to 250,000 passengers on a daily
basis. The train was recently trialed and is due to be completed in a matter of
months.

 4. 2,000 km of rail and road networks connecting Kashgar, China to

Gwadar, Pakistan: CPEC solely focuses on the infrastructure of Pakistan
from North to South along the economic corridor. The chains of roads and rail
networks ensure both the investors and the public a route to communicate
more efficiently and it is expected that both countries will see economic
benefits. It is estimated that around $2-2.5 billion revenues per year could be
added to the economy of Pakistan within a few years.
 Karakoram Highway Phase 2: The phase 2 of Karakoram highway connects
Thakot and Havelian in KPK (Khyber Pakhtunkhwa) in a 120km highway and
is already under construction. The road is considered to be a major highway
that would establish a foundation of networks from the north to the south. The
project is expected to be complete in the first quarter of 2020. The financial
estimate of this project is $1.36 Billion .

 . Special economic zones where companies can enjoy business incentives

and tax holidays: to facilitate rapid commercial and economic development
and encourage investment from industries around the world, Pakistan
promises to set up special economic zones. These zones can be found on
the outskirts of large cities in Pakistan such as Faisalabad, Islamabad,
Mirpur, Nowshera, Karachi, and Gilgit.
CRITICISM ON PROJECTS:
Huge Loan
- The CPEC is based on a$46 Billion loan (now it$55 Billion) that Pakistan
hastaken from China under Sovereign Guarantee. From the original allocation
the $11-billionamount for infrastructure purposes is a Chinese loan whereas the
$35-billion investment for thepower sector. Infrastructure investments offered by
China for CPEC is to be paid back asequity (ROE) which is guaranteed at either
17% or 20%.
One sided bids for Chinese Companies
- The contracts for investments inCPEC are all one sided,no bid contracts
against Chinese companies.There will be no Global Tenders and contracts are
confined to Chinesecompanies with Pakistani sub-contractors are the only ones
who are getting theafter meal leftovers that the Chinese would leave on their
plates. There are alsoreport that some of the projects are awarded to black
listed companies inChina, and substandard construction of Chinese Companies
never sure thequality.Kanpur and Nandipur hydroelectricity Power Plants are
primeexamples.
THE END