The entire development of Pakistan’s future economy is based on the China Pakistan Economic Corridor (CPEC). The Indus River miraculous development will take effect sometime later. This development looks amazing.
The CPEC is now central to the growth of Pakistan. The country cannot ignore the existence of the CPEC. From Pakistan’s Southern Port City of Gwadar to the Northern Karakorum Pass, the entire region will become a cornerstone of CPEC development. Without the assistance of China, the whole package of CPEC development will not materialise. China is central to the CPEC.
When the CPEC was offered to Pakistan in 2013, there was a call from Kazakhstan and Indonesia that China was interested in building a huge corridor network in Asia and this would consist of a China-Central Asia corridor, a China-Mongolia-Russia corridor, a China-Bangladesh-India-Myanmar corridor, and a China-Indochina Peninsula corridor.
Work on these corridors is at different stages. The CBIM is the slowest of all corridors but time is not far as yet not to entirely work on this project. CBIM would enable fruitful relations.
There is around $8.2 billion for the mainline (ML-1) project of Pakistan Railways, $2 billion for Karachi Circular Railways, mass transit schemes of Quetta and Peshawar and five small road projects, according to signed minutes of the 8th JCC meeting held recently. According to the framework agreement for the ML-I, China will provide 85 percent of the project cost as a concessionary loan.
The project has been declared strategically important by both Pakistan and China. The ML-I project has a total length of 1,872 kilometres. The project’s initial cost of $8.2 billion was based on a joint feasibility study, which was not backed by a technical design study.
Around 700,000 new jobs will be created under these schemes by 2030. The project is aimed at improving the labour intensive workforce in Pakistan. When CPEC moves beyond road construction to enter into the building process of economic zones, the standard of the workforce will be raised in the country. There will be a great transformation in the sense that more female workers will be available for CPEC projects.
The whole of Pakistan will be transformed. Indigenous enterprises and indigenous development will become stronger and stronger. CPEC will provide a wide range of employment opportunities for Pakistani men and women, hoping the project will include greater technical education and vocational training for both men and women to find employment in CPEC projects.
CPEC is beyond any kind of suspicion. India has objections against CPEC but they are unworkable. Azad Kashmir is a disputed area between Pakistan and India. The post Azad Kashmir favours CPEC and finds its development issues in it. Likewise, Indian-held Kashmir also finds its developmental phenomenon in the CPEC.
The Hurriyat leadership in Jammu and Kashmir find resolution in CPEC and greatly wish to join the projects with Pakistan. India, on the other hand, objects to the CPEC projects.
The Middle East is an important point in connecting CPEC as China has wished to get connected via the sea lane through Gwadar to transport oil and gas from the Gulf to China. The shipment of oil from the gulf via Gwadar will reduced by a distance of over 12,000 km including the risk at the Strait of Malacca for Chinese shipments. Therefore, the CPEC is considered economically vital to Pakistan in helping it drive economic growth.
The project is going to have a smooth effect on Pakistan trade with China. China is Pakistan’s largest trading partner and more trade is expected between the two countries. Trade conducted in yuan currency will boost trade with Pakistan and will reduce the danger of the dollar any time.
The increased demand of trade between the two countries will be stable factor and will bring benefits to the two countries. The increased trade will also gradually reduce any trade gaps between the two countries and Pakistan might find itself in a better situation. Pakistan’s financial woes will also be reduced if the trade volume between the two countries increases.
The annual trade volume between the two countries is about $15 billion, of which Chinese exports to Pakistan are estimated at around $13 billion. The yuan trade will address this issue and payment in Pakistan in yuan instead of dollars will greatly reduce pressure on Pakistan. The State Bank of Pakistan has already declared yuan as an approved foreign exchange for all purposes in the country. Other mechanisms also reduce Pakistan’s dollar burden.
Besides the financial grip between Pakistan and China and also other financial and trade matters, Pakistan is getting closer to China in a befitting manner. It is believed that Pakistan is not only getting closer to China but also be seeking greater trade and financial management on Chinese patterns. In the foreseeable future, it is likely that Pakistan may come out of all financial grips and stand on its feet.