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March 2018
A review of national, bilateral and regional dynamics
CONTENTS
EXECUTIVE SUMMARY
A NATIONAL PERSPECTIVE ON CPEC
B BILATERAL (PAK-CHINA) PERSPECTIVE
C REGIONAL / INTERNATIONAL DYNAMICS
D ANALYSIS
CPEC Monitor | March 2018
Executive Summary
While government continues to pin hopes from CPEC, the original alarms by smaller provinces refuse to die down easily. It is high-time that the findings and performance of the two parliamentary committees formed on CPEC be assessed; these committees are to start afresh after Senate elections in March. Also, worth considering is the idea of regional connectivity, especially after Iran rejected the notion that Chahbahar port will compete Gwadar port.
Many circles in the country reiterate about economic potential of CPEC. To avoid any economic meltdown during CPEC execution, government has projected China and Saudi Arabia to provide “$6-8 billion breathing space.”
The first-ever shipment of a Chinese company from Gwadar to UAE, completion of a desalination plant in Gwadar, and 1st phase of Pakistan’s railway up-gradation (likely to begin next month) illustrates progress on some of the signature projects of CPEC. However, the ML-1 project continues to face delay.
Meanwhile, Balochistan government has accused federal government of not releasing promised funds for the
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development of Gwadar port city. Baloch nationalist across Pakistan are skeptical about the benefit for them.
Western route of the corridor continues to draw attention. KP and Balochistan politicians call upon government to fulfill the promise made at the All-Parties Conference in 2015. Government says it has been building that route; one project director reportedly said that the western route will be built ahead of the eastern one. Yet confusion reigns, with another representative saying the route has been absent from the Chinese record.
It is worth mentioning that after the APC was held, a bi-cameral parliamentary committee was formed too, which, among other things, was tasked to implement the suggestions of the APC. Late on, another parliamentary committee, in Senate, was formed too. March saw completion of some of these committees; the performance of these committees should be evaluated now.
The government has also been trying to clarify that it has not been favouring Chinese one way or the other. It rejected reports about Chinese companies getting tax exemption in the projects. There are reports that Pakistan and China will sign second phase of the Free-Trade Agreement. Government is advised not to rush into it; for one, the local manufacturers should be brought on board first.
Not a single security-related incident was reported for the entire month. Chinese companies were allowed to hire private security guards, in addition to the ones already provided by the government. Apparently, a sprawling security infrastructure is
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piling up to protect CPEC projects and workers; it is important that the rules are clearly-defined and overlapping avoided.
On the geostrategic front, Iran invited Pakistan and China to Chahbahar and discredited the misperception about Chahbahar port is a rival port to Gwadar. This resonates with the broader idea of regional connectivity too, which is cornerstone of the entire corridor project.
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CPEC Monitor | March 2018
A
NATIONAL PERSPECTIVE ON CPEC
1. Politico-economic The SourceStatementsFaisalabad Chamber of Commerce & Industry (FCCI) former Vice President Ahmad Hassan said CPEC has provided new avenues of value-addition in the textile industry.
The Frontier Post, March 9, 2018;Parvez Jabri, Business Recorder, March 9, 2018
President Islamabad Chambers of Commerce and Industry Sheikh Amir said that Pakistan is not capable enough to take maximum advantages of CPEC, and urged the government to address the issue of import-oriented economy and unskilled labor by providing training to local investors and promoting the culture of export-oriented economy.
Khalid Aziz, The Nation, March 11, 2018
Planning Commission Deputy Chairman Sartaj Aziz stated, “CPEC will transform our country into an economic power that all the Pakistanis wanted.”
The Nation, March 15, 2018
Minister for Planning and Development Ahsan Iqbal said, “Pakistan will become an industrial hub of South Asia after completion of CPEC.”
The Nation, March 18, 2018;Business Standard, March 19, 2018;Pakistan Observer, March 19, 2018
In order to avoid economic crisis and for Mehtab Haider, The News,
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smooth execution of CPEC, Pakistan has shared different proposals with friendly countries, particularly China and Saudi Arabia, that included the provision of “$6-8 billion breathing space in shape of cash grants, parking money as safe deposits into the central bank, allowing payment of imports in Pak Rupee and provision of oil imports at deferred payment.”
March 28, 2018
Pakistan Chemical Manufacturers Association (PCMA) has requested the government to not rush into the 2nd phase of FTA with China, as it will harm the local industry.
The Nation, March 28, 2018;Hanif Khalid, Jang, March 28, 2018
Action/Visits
Report/AnalysisExperts believed that China, under the CPEC, played a significant role in the economic development of Pakistan and that energy shortfall has been declined to zero in 70% areas of Pakistan under the CPEC.
Pakistan Today, March 10, 2018;The Nation, March 11, 2018
General Manager Pearl Continental (PC) hotel Zulfiqar Ahmed decided to expand its business by establishing hotels along CPEC routes, and even bought some properties along CPEC routes in Punjab.
Shahram Haq, The Express Tribune, March 11, 2018
A report said that CPEC routes would be ideal for 15 local oil marketing firms who have got a license from Oil and Gas Regulatory Authority (OGRA) to build oil storage infrastructure across Pakistan.
Tariq Ahmed Saeedi, The News, March 11, 2018
A report by the United Nations (UN) Department of Economic and Social Affairs (DESA) said that under the healthy economic activity and huge CPEC infrastructure projects, investment demand in Pakistan has gained momentum.
United Nation Department of Economic and Social Affairs (UNDESA);Amin Ahmed, Dawn, March 11, 2018
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Strategists are confused about the transparency of CPEC projects since inconsistencies have been found in awarding motorway (M5) contract by the National Highway Authority (NHA) to a Chinese state-owned organization once accused of corruption by the World Bank in 2009.
Faran Mahmood, The Express Tribune, March 12, 2018
President Pak-China Joint Chamber of Commerce and Industry emphasized knowledge is important to be developed to bring innovation in CPEC projects.
Haider Ali Sindhu, Daily Pakistan, March 12, 2018
An analyst suggested that there should be CPEC unit within the Council of Common Interests (CCI) for efficient and transparent execution of CPEC projects. One economist hinted that CPEC is likely to add 2% to Pakistan’s GDP growth rate.
Shahram Haq, The Express Tribune, March 13, 2018
Ministry of Information Technology and Telecommunication believed that economic development of Pakistan under CPEC would help the advancement of Information Technology (IT) sector.
Ramzan Asghar, Daily Aftab, March 13, 2018
Federal government discredited the reports about tax exemption to Chinese companies under CPEC. A report said that 91% share of Gwadar expenditure has been obtained from a company of Singapore.
Azhar Jatoi, Daily 92, March 15, 2018
A report said that Pakistan’s Foreign Direct Investment (FDI) grew 15.6 percent in July-Feb FY18 due to heavy Chinese inflow under the CPEC.
Eram Zaidi, The News, March 17, 2018;Gulf Times, March 18, 2018
A report said that current duty exemption on imports under revised bilateral Free Trade Agreement (FTA) is likely to double the revenue loss to Pakistan as it has lost Rs 32 billion in 2016-17 due to duty exemption on Chinese imports under the FTA.
Mubarak Zeb Khan, Dawn, March 17, 2018
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CPEC Monitor | March 2018
Planning Commission Deputy Chairman Sartaj Aziz believed that advantages of CPEC cannot be fully utilized if Pakistani investors remain reluctant to joint business ventures of the second phase of CPEC.
Shahbaz Rana, The Express Tribune, March 18, 2018
A report noted that economy of Pakistan is vulnerable to decline in CPEC-related Chinese funding as the first half of this fiscal year have received $506 million of Chinese funding parallel to $848 million in the same period of last fiscal year.
Ihtashamul Haque, The Express Tribune, March 19, 2018
The state minister responsible for promoting foreign investment in Pakistan Naeem Zamindar discredited the misperception about Chinese getting “exclusive advantages” and affirmed some Chinese companies got soft loans under terms and conditions attached to CPEC financing but the 2nd phase of CPEC - industrialization- would follow “nondiscriminatory” approach in execution.
Drazen Jorgic, Reuters, March 21, 2018;The Express Tribune, March 21, 2018;Dawn, March 22, 2018;The News, March 22, 2018
Advisor to the Chairman Silk Bank Shaukat Tarin said Pakistan has experienced transformation and mentioned SEZs as the significant part of that transformation.
Mohammad Arshad, Zahid Chaudhary, Pakistan Observer, March 22, 2018
A report foresee hike in the economic development of Pakistan under CPEC. The report said necessary measures should be adopted to improve local conditions that will create “formal jobs and generate tax revenues that could pay for corridor investments.”
The World Bank, March 22, 2018;Mehtab Haider, The News, March 23, 2018;The Nation, March 23, 2018Shahbaz Rana, The Express Tribune, March 23, 2018;Gulf Times, March 24, 2018
A senior economist Guntur Sugiyarto termed CPEC “a golden opportunity” for development of Pakistan.
Jawad Rizvi, The News, March 30, 2018
2. Provincial/regional developments and concerns
The Source
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StatementsPresident Mamnoon Hussain endorsed the youth of Balochistan to learn the Chinese language to reap maximum advantages of CPEC. “The dream of converting CPEC into a reality demands national unity by putting aside petty differences.” He added.
Dawn, March 5, 2018;Mohammad Zafar, The Express Tribune, March 13, 2018
Recently elected Senate Chairman, Muhammad Sadiq Sanjrani said that CPEC will be beneficial not only to Balochistan but for the whole region.
Pakistan Today, March 18, 2018
Balochistan Assembly Speaker Raheela Hameed Khan Durrani said CPEC would bring economic development in Balochistan.
Dawn, March 22, 2018;Pakistan Today, March 22, 2018;
President of a dissident Baloch movement, Baloch National Movement – North America, Zaffar Baloch alleged Pakistan had “sold” Balochistan “off to China as a colony”, and urged a “halt to Chinese control of Gwadar port and withdrawal of all the Chinese personnel from the area”.
Anirudh Bhattacharya, Hindustan Times, March 27, 2018
President All Pakistan Business Forum (APBF) Ibrahim Qureshi believed that all provinces should equally benefit under the CPEC to promote infrastructure development and Information Technology (IT).
The Express Tribune, March 27, 2018;The Nation, March 28, 2018
Awami National Party (ANP) provincial president Ameer Haider Hoti said accused federal government for not fulfilling its promise of developing western route under the CPEC.
The News, March 28, 2018
Commander Frontier Corps (FC) North Sector Balochistan, Brigadier Nadeem Suhail said CPEC would open new vistas of investment opportunities for Balochistan and Pakistan.
The Nation, March 30, 2018;Parvez Jabri, Business Recorder, March 31, 2018
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Action/VisitsTo provide the youth of Gilgit Baltistan (GB) technical education for their increased role in CPEC, the National Logistics Cell (NLC) has established an Applied Technologies Institute (ATIN) in GB.
Dawn, March 20, 2018;The Express Tribune, March 21, 2018
Balochistan Governor Muhammad Khan called Russian’s Consul General Dr. Aleksander, underlining t that CPEC is beneficial for Balochistan and discussed bilateral relations and implementation of CPEC.
The Express Tribune, March 23, 2018
Report/AnalysisKhyber Pakhtunkhwa Assembly Deputy Speaker Dr. Mehr Taj emphasized that women with 51% of population deserve at least 20% of representation in CPEC.
The News, March 2, 2018
While being quite optimistic about the development of Pakistan under CPEC, Governor Sindh Muhammad Zubair said that CPEC would bring benefit not only to Pakistan but China and the whole region.
Kenrick Lee, Peter Wang, China Daily, March 7, 2018
In order to promote provincial economic development, Balochistan Governor Mohammad Khan Achakzai urged the government to establish maximum industrial zones under the CPEC.
Parvez Jabri, Business Recorder, March 10, 2018;The Express Tribune, March 11, 2018
Punjab Governor Malik Muhammad Rafique Rajwana said that benefits of CPEC are not limited to Pakistan but it will contribute to regional development.
Parvez Jabri, Business Recorder, March 13, 2018
During the 37th UN Session on Human Rights, Baloch political activist expressed grievances against CPEC, saying that UN should interpret the legal bearing of this mega project.
Deccan Chronical, March 13, 2018;Business Standard, March 13, 2018
In Fateh Jang, people expressed their concerns about insufficient compensation
Daily92, March 26, 2018
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of land acquired by the government for CPEC. Concerned authorities have not yet paid for the land acquired a year ago.Balochistan Chief Minister Abdul Quddus Bizenjo accused federal government for not releasing promised funds of Rs1 billion for Gwadar Port City.
Mohammad Zafar, The Express Tribune, March 31, 2018
3. Socio-cultural The SourceStatementsAction/VisitsReport/AnalysisUnder Supreme Court instructions, four stations of Orange line metro train in Lahore will be designed in synchronization with historical buildings around.
Dawn, March 2, 2018
Professor at Islamic International University (IIU) stressed upon need-based curriculum reforms in CPEC context.
The Express Tribune, March 9, 2018
Ministry of Information Technology (IT) noted that IT market is likely to expand under the CPEC.
The Express Tribune, March 18, 2018
4. Security The SourceStatementsInspector General of Police (IGP) AJK Shoaib Dastgeer said that government has decided to establish a Special Protection Unit (SPU) in AJK for the security of CPEC and non-CPEC workers.
Abid Hussian Shah, The News, March 4, 2018;Pakistan Today, March 4, 2018;The Nation, March 5, 2018
Director General Inter Services Public Relations (DG, ISPR) Major-General Asif Ghafoor said that Pakistan will do anything to guard the CPEC.
The Express Tribune, March 18, 2018
Federal Minister of States & Frontier Region, Lieutenant-General Abdul Qadir Baloch (retd) said during the 14th International Safe Secure Pakistan exhibition-2018 that “Safe Secure Pakistan
Business Recorder, March 28, 2018;Pakistan Observer, March 28, 2018
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is the most important part of the CPEC project".Security Incidents
Action/VisitsIslamabad policed organized a seminar where Chinese students were briefed about security threats and instructions to be followed during their stay in Islamabad.
Arsalan Altaf, The Express Tribune, March 18, 2018
The government has decided to issue a national security certificate for the sale of shares in Karachi Electric K-E to the Chinese multinational Shanghai Electric Power Ltd, with final approval of the federal cabinet.
Sajid Chaudhary, Daily Dunya, March 31, 2018;Dawn, March 31, 2018;The News, March 31, 2018
Report/AnalysisSindh police is keen to expand the jurisdiction of Special Protection Unit (SPU) that will change the designation of the SPU deputy inspector general of police (DIG-P) to Foreign Security DIG-P, who will monitor provincial and district foreign security cell to ensure the security of foreign nationals working on CPEC and non-CPEC projects.
The News, March 8, 2018
A report said that glaciers in Gilgit-Baltistan (GB) are vulnerable to the environmental threats surfaced after CPEC.
Financial Express, March 4, 2018;Business Standard, March 4, 2018
To control the flow of traffic along CPEC routes, the federal government has decided to conduct a study under the Center of Excellence.
Haseeb Hanif, Daily Express, March 4, 2018
An official of Counter Terrorism Department (CTD) revealed that organization’s internal matter caused the killing of Chinese worker of Cosco Shipping Lines Company Limited. Following this incident, the CTD asked concerned authorities to enhance the
Imtiaz Ali, Dawn, March 9, 2018
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security of CPEC and non-CPEC Chinese workers, and emphasized that CPEC management companies should urge to add private security guards other than provided by the government. However, Rangers, SPU, and army soldiers have been providing security to the CPEC and non-CPEC projects.
The National Assembly’s Standing Committee on Finance has instructed the Security and Exchange Commission of Pakistan (SECP) to conduct an inquiry against China Overseas Ports Holding Company (COPHL), a company working on Gwadar without having security clearance certificate from Interior Ministry.
Mehtab Haider, The News, March 14, 2018;Shahbaz Rana, The Express Tribune, March 14, 2018
5. Progress on CPEC-linked projects The SourceStatementsDistrict Nazim Peshawar Mohammad Asim Khan declared the construction of CPEC tower at Peshawar general bus stand costing around Rs.10 billion.
The News, March 1, 2018
CEO of the Institute of Rural Management (IRM) underlined to enhance youth’s skill by training to take full advantages of CPEC.
Zafar Bhutta, The Express Tribune, March 2, 2018
Chairman of Steering Committee for Lahore Orange Line Metro Train project Khwaja Ahmed declared that the elevated track of Lahore Orange Line Metro from Dera Gujjran to McLeod road is complete.
Dawn, March 5, 2018
State Engineering Corporation (SEC) Chairman Syed Kaukab underlined that domestic local industries need to be upgraded to enter into useful joint ventures under the CPEC.
The Express Tribune, March 6, 2018;The Nation, March 6, 2018;Parvez Jabri, Business Recorder, March 6, 2018
Chinese Foreign Minister Wang Yi ensured The Express Tribune, March
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the transparent execution of BRI saying power projects under CPEC would alleviate electricity crisis in Pakistan.
9, 2018;Daily Times, March 9, 2018;The Nation, March 9, 2018
Senator Usman Khan Kakar during his visit to China observed the western route of CPEC was absent from Chinese record. He further criticized Parliamentary Committee on CPEC for not presenting single report on CPEC.
The News, March 10, 2018
Deputy Chairman Planning Commission Sartaj Aziz underlined rapid execution of CPEC, saying it is far ahead of other BRI projects.
Business Recorder, March 18, 2018
Pakistan Ambassador to China Masood Khalid said that out of 9 industrial parks under CPEC, 2 or 3 are likely to be built this year.
The Nation, March 23, 2018;China Pakistan Economic Corridor, March 23, 2018;Mohammad Irfan, Daily Pakistan, March 23, 2018;Business Recorder, March 24, 2018
Pakistan Muslim League-Nawaz central joint secretary Rehmat Salam Khattak said work on Shakardara road would begin soon that would link Karak to CPEC.
Dawn, March 25, 2018
CPEC project director Hassan Dawood said the 2nd unit of Port Qasim is set to generate 660 megawatts this month.
Pakistan Today, March 27, 2018;China Pakistan Economic Corridor, March 30, 2018
Action/VisitsThe Executive Committee of the National Economic Council (ECNEC) meeting agreed on land acquisition, compensation and repositioning of utilities for KKH Phase-I CPEC (Havelian-Thakot) project at a total rationalized cost of R. 12,606.62 million.
Daily Times, March 8, 2018;The Nation, March 8, 2018;Business Recorder, March 8, 2018
Chinese state-owned shipping and logistics services supplier company (COSCO) dispatched the first-ever shipment from Pakistan’s Gwadar to UAE. COSCO
Dawood Rehman, Daily Pakistan, March 7, 2018;China Pakistan Economic Corridor, March 8, 2018
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Chairman underlined the cargo shipping lines would be carrying 5000 containers on the route.Believing the establishment of Special Communication Organization (SCO) is illegitimate, Information and Telecom Ministry and Pakistan Telecommunication Authority (PTA) has decided to hand over the execution of CPEC fiber optical project to National Telecommunication (NTC) than the SCO.
S.M. Zaman, Dunya, March 12, 2018
Ministry of Planning, Development, and Reforms has given the deadline of 30th June to all provincial government to complete the feasibility reports of CPEC industrial zone.
Haseeb Hanif, Daily Express, March 13, 2018
Power division has decided to improve the existing transmission network, and extended financial close deadline of Matiari-Lahore Transmission Line and Thar coal-based power projects under the CPEC.
China Pakistan economic Corridor, March 15, 2018;The Express Tribune, March 15, 2018;The Nation, March 15, 2018;Parvez Jabri, Business Recorder, March 15, 2018
Chairman Gwadar Port Authority (GPA) declared that a 300 megawatts coal-based power plant would be established in Gwadar by a Chinese firm under the CPEC. Also, it informed that up-gradation of ML-1 would begin within three months.
Mahmood Idrees, Daily Pakistan, March 15, 2018
Total approved 34 projects of Rs. 365 billion under the CPEC has been approved by the Central Development Working Party (CDWP); out of these five projects were referred to the Executive Committee of National Economic Council (ECNEC) for approval.
Global Village Space, March 20, 2018
The CDWP has approved CPEC Industrial Cooperation Development Project at a cost
The Herald, March 20, 2018;Board of Investment, March
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of Rs339.3 million to be executed by Board of Investment (BoI). The project aims “to design industrial cooperation plan till 2030, carrying out research studies and identifying investment opportunities for the establishment of SEZs.”
20, 2018;Shahbaz Rana, The Express Tribune, March 20, 2018;Dawn, March 20, 2018
Chairman Gwadar Port Authority Dostain Khan Jamaldini informed that desalination plant in Gwadar under the CPEC is completed to address the issues of clean drinking water for the people in the region by providing 2 lakhs 50-thousand-gallon water daily.
Daily Dunya, March 26, 2018
Chinese Ambassador to Pakistan Yao Jing conveyed around 20 projects under the CPEC are developing while several are about to complete.
Muhammad Irfan, Daily Pakistan, March 28, 2018;Pakistan Observer, March 29, 2018
Report/AnalysisSenators alleged inconsistency in 10 billion tax exemption to a Chinese company working for the construction of Multan-Sukkur motorway. He further asked National Highway Authority (NHA) to submit MoU of this project and detailed list of items of tax exemptions.
Mehtab Haider, The News, March 1, 2018
The government has notified Matiari-Lahore transmission line authority in Sindh that if power projects under transmission line are delayed, the authority/sponsor will have to pay the capacity charges.
Khalid Hasnain, Dawn, March 2, 2018
The first phase of Pakistan railway up-gradation consists of four tracks i.e. Rawalpindi to Lahore, Kaluwal to Pindora, Rohari to Nawab Sha, and Lahore to Multan would start in April, 2018 under the CPEC.
Amir Yasin, Dawn, March 2, 2018
By assuming Chinese prisoners working on CPEC projects in Pakistan, fearing they might involve in undesirable activities, Member National Assembly Nawab
The Economic Times, March 2, 2018
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Mohammad Yousuf Talpur urged the government to ensure the effective security system for CPEC execution. However, Interior Ministry said it is not familiar with Chinese prisoner working in Pakistan.The Planning Commission official revealed that China and Pakistan have mutually decided to divert 6,000 MW out of 17,050 MW to the development of hydropower projects while the energy projects are having a total capacity of 11,110MW.
Khaleeq Kiani, Dawn, March 3, 2018
A report said that around 40,000 Chinese came to Pakistan since the launch of CPEC.
Zahid Gishkori, The News, March 5, 2018
In KP, the work on Suki Kanari hydropower project was hampered by its landowners who claimed that land compensation provided to them is not up to the market rates.
Dawn, March 13, 2018
In 2018, total 41 CPEC related agreements have been signed by Chinese companies for the socio-economic development of Pakistan.
The News, March 16, 2018
Project director CPEC Hassan Daud briefed National Assembly Committee on Planning, Development, and Reforms about the development of CPEC projects. He said that “they are working on two routes of CPEC and they are striving to complete the western route ahead of the eastern one.” The committee suggested the priorities construction of CPEC (central) route passing through backward areas.
Fawad Yousafzai, The Nation, March 16, 2018
The Fauji Fertilizer Company Limited (FFCL) and the Hub Power Company Limited (HUBCO) have decided to form coal-based power plant of 330MW in Thar and domestic coal will be utilized for this power project.
The Express Tribune, March 16, 2018;The News, March 16, 2018;Business Recorder, March 16, 2018
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The investment holding company Dawood Hercules Corporation (DH Corp) boosted the generation capacity of Hubco to 3,276 megawatts by investing $3.5 billion in joint ventures of CPEC prioritized projects.
Pakistan Observer, March 17, 2018
Several engineers underlined that proper planning is imperative to take full advantage of CPEC.
The Nation, March 18, 2018;Daily Times, March 18, 2018
Federation of Pakistan Chambers of Commerce and Industry (FPCCI) acknowledged the significance of CPEC in the economic development of Pakistan. It further urged the government to bring transparency in CPEC routes and implementation of projects.
Board of Investment, March 20, 2018;Shahnawaz Akhtar, The News, March 20, 2018
PPP’s Farhatullah Babar urged need to protect the rights of domestic labor and promote transparency in all infrastructure projects under the CPEC.
The News, March 21, 2018;Pakistan Today, March 21, 2018;Dunya, March 21, 2018
A researcher informed that Thakot-Havelian motorway (120 km) and Suki Kinari Hydropower Project (870mw) are in the last stages of completion.
Pakistan Observer, March 21, 2018
The 25.5 kilometers elevated viaduct for the Lahore Orange Metro Train has been constructed successfully and Chinese contractor has been instructed for further accelerating the work.
Dawn, March 22, 2018
The first phase of railway up-gradation will start next month CPEC with an investment of worth $ 3.2 billion. The 4 sections are to be upgraded in this phase included Lahore-Rawalpindi, Lahore-Multan, Kaluwal-Pindora and Rohari-Nawab Shah
The Express Tribune, March 26, 2018
The documentation and feasibility report of laying the Besima-Quetta and Besima-Jacobabad tracks under CPEC is completed. Also, it has been forwarded to Planning
Fawad Maqsood, Business Recorder, March 26, 2018;The Express Tribune, March 27, 2018
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Commission for final approval.Chinese and Pakistani steel firm has signed a Memorandum of Understanding (MoU) to start work on the $50 million steel mills at the Gadoon Industrial Estate. It also decided to form a hot roll steel rebar industry in Khyber Pakhtunkhwa (KP) while the KP Economic Zones Development and Management Company (KPEZDMC) has urged the federal government and Board of Investment to include the Comprehensive Special Economic Zones (CSEZs) in CPEC.
The News, March 27, 2018
The Public Accounts Committee (PAC) chairman Syed Khursheed Shah expressed resentment over granting extra 42% to the CPEC’s Hyderabad-Sukkur Motorway project.
The Nation, March 29, 2018
Ministry of Planning Development and Reforms informed that Pakistan has deferred Mainline-I (ML-I) project due to cost China attached to Phase-1 higher than Pakistan estimated. Even Chinese consultant has reduced its scope by 56% compared to the already-approved in 2016.
Shahbaz Rana, The Express Tribune, March 30, 2018
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B
BILATERAL (PAK-CHINA) PERSPECTIVE
1. Bilateral relations SourceStatementsChinese envoy to Pakistan Yao Jing said that Pak-China bilateral relations growing towards “shared destiny” and socio-economic development.
Pakistan Observer, March 1, 2018
Chinese President Xi Jinping said that “the image of Pakistan has improved as the country gives full support to BRI.”
Fawad Maqsood, Business Recorder, March 9, 2018
Renmin University of China’s Chair Professor Jean Monnet believed that due to the economic development under CPEC, Pakistan will be middle power around 2035
Pakistan Today, March 16, 2018
Chinese ambassador Yao Jing said, “China cannot afford to lose Pakistan because stability in its neighborhood is integral to China’s development.”
Pakistan Today, March 16, 2018;The Express Tribune, March 17, 2018;The Nation, March 18, 2018;
President of Azad Jammu & Kashmir Sardar Masood Khan said, “CPEC is a win-win project for China and Pakistan.”
The Nation, March 20, 2018
Federal Secretary Commerce Mohammad Younas said in a 2nd round of FTA, Pakistan tends to get “zero-rated duty on exports to
Parvaiz Ishfaq Rana, Dawn, March 28, 2018
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China.”A representative of the Chinese Ministry of National Defence Ren Guoqiang said bilateral defense cooperation would promote regional, international peace and stability. Also, Peoples Liberation Army echoed the same.
Dawn, March 30, 2018;The News, March 30, 2018;The Express Tribune, March 30, 2018
Chinese ambassador to Pakistan Yao Jing lauded bilateral media collaboration, saying it would promote cooperation in sociocultural and economic field.
Pakistan Observer, March 29, 2018
Action/VisitsTo strengthen Pakistan missile system, China has provided it with the new powerful tracking system.
Stephen Chen, South China Morning Post, March 22, 2018;The Hindu, March 22, 2018;The Economic Times, March 22, 2018;Daily Dunya, March 23, 2018;The Nation, March 23, 2018;Sreemoy Talukdar, First Post, March 23, 2018
Pakistan’s National Security Adviser Lt Gen (Retd) Nasser Khan Janjua and China’s ambassador to Pakistan Yao Jing discussed bilateral relations and various aspects of CPEC.
The Nation, March 27, 2018;Daily Times, March 27, 2018
2. People-to-people relations The SourceStatementsAction/VisitsReport/AnalysisChina’s Ambassador to Pakistan Yao Jing underlined four areas of bilateral cooperation under CPEC.
The News, March 5, 2018
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CPEC Monitor | March 2018
I) Prioritized execution of energy projects.
II) Use of Pakistan’s local/indigenous resources for CPEC projects.
III) Projects implementation to be environment friendly.
IV) Energy projects based on commercial loans by the Chinese companies than putting the burden on Pakistan’s economy.
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C
REGIONAL / INTERNATIONAL DYNAMICS
3. On CPEC and Geo-economic Connectivity
The Source
StatementsPresident of Pakistan Mamnoon Hussain while addressing the 10th annual conference of Nazaria-e-Pakistan Trust (NPT) said Russia, Middle East, and Europe tend to join CPEC.
Nawa-i-Waqt, March 2, 2018
Former Union Minister of State, and Minister of Information and Broadcasting underlined a difference between Chabahar and Gwadar port stating that “Gwadar port is a strategic military enterprise while Chabahar is a commercial enterprise.”
The Hindu, March 3, 2018
Iran’s Foreign Minister Javad Zarif stated, “we offered to participate in CPEC and we have also offered China and Pakistan to participate in Chahbahar.” He further conveyed efforts made to link Gwadar and Chahbahar, offered Pakistan to join in.
Baqir Sajjad Syed, Dawn, March 13, 2018
Former Chief of Naval Staff Admiral Asif said, “Gwadar and Chahbahar will complement each other; CPEC will be a game changer if Pakistan plays its cards
Dawn, March 14, 2018
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in its own interest.”Minister for Planning, Development and Reforms Ahsan Iqbal said India should not criticize CPEC but it should gain benefit from this mega project. “CPEC would provide market access to the Central Asian States and via CARs to other parts of the world”, he added.
The Nation, March 22, 2018Syed Irfan Raza, Dawn, March 23, 2018;Business Standard, March 23, 2018
President of Sri Lankan Maithripala Sirisena expressed his pleasure over economic development of Pakistan under the CPEC.
Pakistan Today, March 22, 2018;The Nation, March 22, 2018
Senate Chairman Sadiq Sanjrani lauded Chinese assistance under CPEC.
Pakistan Today, March 28, 2018
Iran’s former foreign minister Kamal Kharazi disregarded the perception of Chabahar port as a rival to CPEC. “Though India is investing in Chabahar, we have not given exclusive rights on the project to them,” he added.
Bilal Karim Mughal, Dawn, March 31, 2018
Action/VisitsChina Pak Investments Corporation (CPIC) has launched an advertisement campaign in London to promote Gwadar as a regional global trade hub.
Murtaza Ali Shah, The News, March 4, 2018;Dawood Rehman, Daily Pakistan, March 4, 2018
Prime Minister Pakistan Shahid Khaqan Abbasi visited Nepal where he mentioned that Pakistan is ready to share experience and knowledge linked to CPEC.
The Nation, March 6, 2018
Report/AnalysisA report said that CPEC will open news vistas of business opportunities for regional economic development.
The Express Tribune, March 10, 2018;The Nation, March 11, 2018
4. Regional Dynamics and CPEC Security
The Source
Statements
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National Security Adviser (NSA) Lt. General (r) Nasser Khan Janjua said CPEC is vital for regional peace and development.
Pakistan Today, March 1, 2018;China Pakistan Economic Corridor, March 2, 2018
The chief of US Army General Joseph Votel stated that “Belt and Road Initiative (BRI), which includes the CPEC, could serve as a stabilizing, profit-generating project in the region, but it could also improve China’s military posture.”
Parvez Jabri, Business Recorder, March 2, 2018
Action/Visits
Report/AnalysisA report said that mediating between India and Pakistan to help them resolve Kashmir issue would be a big challenge as China has always pursued the policy of non-intervention. China is interested to mediate due to its heavy investment in the region under the BRI.
Nawa-i-Waqt, March 31, 2018
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CPEC Monitor | March 2018
D ANALYSISPolitical Development
Grievances from smaller provinces in particular Balochistan refuse to die down. Government has been assuring that national unity will be upheld. Those assurances should be met.
Nationalist parties from Balochistan and KP say that despite being promised that the western route of CPEC will be prioritized, nothing has been done to that effect. They blame the government for backtracking from their commitment made at the All-Parties Conference in 2015. It is unfortunate to mention that despite the existence of a parliamentary committee as well as a Senate committee on CPEC, formed precisely to address this issue, the issue still remains unresolved. The appraisal of committee’s performance is questionable yet.
Meanwhile, there are reports that Pakistan is stepping into the second phase of Free-Trade Agreement with China. Before stepping in the second phase, government should consult the local manufacturers who feel threatened about it.
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CPEC Monitor | March 2018
Project Implementation and New InitiativesMarch observed fast pace of CPEC-related projects. Delayed and insufficient compensation to land owners have hindered the execution of hydropower project like Suki Kanari in KP. Moreover, after Pakistan’s withdrawal of Diamer-Bhasha Dam from CPEC, ML-1 is another project deferred due to higher cost than the one Pakistan estimated.
Regional contextChina-Pak Investments Corporation (CPIC) led an advertisement campaign in London to promote Gwadar as a regional global trade hub. Pakistan’s willingness to share CPEC-related experience with Nepal is a positive indicator of enhancing regional connectivity under CPEC. Meanwhile, Iran has stated that Chahbahar is not a rival port to CPEC; this may hurt those who see this Indian ploy to pressurize Pakistan.
CPEC securityPakistan is fully committed to the secure and peaceful execution of CPEC. In addition to the setting up of SPU and improving their capacity, Chinese workers are now allowed to hire private guards. While increased security measures are taken, it is must to ensure that there are no institutional confusions or overlapping of work, and that, due processes are followed. The Security and Exchange Commission of Pakistan (SECP) has yet to find that how come China Overseas Ports Holding Company (COPHL) has been working on Gwadar without having security clearance certificate from Interior Ministry.
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CPEC Monitor | March 2018
(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.)
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