Our bets on CPEC may not necessarily pay off

Published: December 13, 2016
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The Chinese and Pakistani flags fly on a sign along a road towards Gwadar, Pakistan January 26, 2016. . PHOTO: REUTERS

In Pakistan, China-Pakistan Economic Corridor (CPEC) has been trending for a few months. Like ‘Brexit’, CPEC is also a big step. Hence, any news related to CPEC spreads like fire. If you are attending an intellectual gathering, be up-to-date with the project. I’ve observed that CPEC is a hot topic at these get-togethers.

There’s no doubt that CPEC is important for Pakistan and it plays a pivotal role in regional politics, but it has been blown out of proportion thanks to print and electronic media. It seems that clock manufacturers in Switzerland are more concerned about CPEC than the precision of their clocks. And drug dealers in Mexico are planning to relocate their businesses to Gilgit-Baltistan so they can benefit from the project. Everything that happens or does not happen, all relies on CPEC.

Our regime uses this hysteria-type approach for a reason; it provides them a lollypop that can be fed to the masses for all the right and wrong reasons. For example, Balochistan has experienced the worst terrorist activities in recent months, and the government’s main point of discussion seems to remain CPEC – that too in this regard. It looks like all the enemies of Pakistan are targeting Balochistan only to destroy CPEC. CPEC-hysteria has aggravated to such intensity that we’ve failed to realise the obvious – was Balochistan peaceful before CPEC was initiated?

Another senseless claim made by the government is how CPEC is a ‘game-changer’ for the poor, deprived and neglected people of Balochistan. It seems that episodes of natural gas exploration from Sui and Reko Diq mine are on repeat telecast, which were also declared as ‘fortune-turners’ for the largest province of Pakistan.

Years – in fact, decades – have passed and the living conditions of the local people are getting worse day by day. In my opinion, CPEC will be yet another addition to this list of game-changers that have brought nothing but loot and plunder for the people of Balochistan. You may call me the promoter of provincial disharmony, but it’s a brute fact that Balochistan has always been treated as an unimportant, trivial and sometimes, unwanted part of Pakistan.

Keeping all pessimistic analysis aside, even if I look ahead with the hope of the CPEC dream coming true, I do not see Pakistan becoming a regional leader. CPEC is actually designed by China, for China. It will use Pakistan as a pathway to increase its access to global markets. The local industry of Pakistan will face a huge blow which, in current condition, will prove fatal. Cheap products from China have already elbowed out local products from almost every household. I still remember the Picasso ball point pen from Shahsons that became an instant hit and its tick-tock sound was everywhere. A few years down the line, you barely see it being used as Chinese pens are now available at less than half the price. Local entrepreneurs do not stand a chance at competing with an economy-of-scale manufacturer like China. With CPEC, China can access all of Pakistan, resulting in Chinese goods becoming even cheaper.

CPEC is a trade route. If trade routes can turn the tables for nations, Egypt would have been the world’s biggest power as it controls the Suez Canal which alone generates billions of dollars in revenue. The world is run by those who use that route – not by those who collect the toll tax.

Abdullah Ansari

Abdullah Ansari

An electrical engineer by profession, Abdullah works in the oil and gas industry. His interests include international relations, global politics and debating. He tweets @AjebSceneHaBhai (twitter.com/ajebscenehabhai)

The views expressed by the writer and the reader comments do not necessarily reflect the views and policies of The Express Tribune.

  • curious2

    These days it’s rare to find an article which talks objectively about CPEC – it’s almost sacrilegious to point out the obvious things mentioned by the author. Most of the CPEC funds are for power plants – but if power was on 24/7 with no interruptions would that insure Pakistan greater exports, greater prosperity, or stimulate the economy enough to even justify the massive expenditure – maybe but it’s far from guaranteed.Recommend

  • Anon

    Indian jealous of “Cheen-Pakistani dosti”Recommend

  • Cautious

    “CPEC is a trade route. If trade routes can turn the tables for nations, Egypt would have been the world’s biggest power as it controls the Suez Canal which alone generates billions of dollars in revenue.”

    The bulk of CPEC money is devoted towards energy production and has nothing to do with “trade routes” – that’s an open secret that few Pakistanis want to recognize. The govt has made Gwadar a focal point but that’s pretty much a scam — the port won’t even have a railway to China until after 2030 (assuming there is any money left) and that pretty much rules out Gwadar as a cost effective port for China.Recommend

  • curious2

    CPEC and Gwadar have been a placebo the govt has been passing on as real medicine to Pakistan since day one.
    .
    Pakistan promotes Gwadar as a critical strategic investment for China … but Pakistan has been trying to offload Gwadar for almost 20 yrs. China never saw it as strategic and wouldn’t even consider accepting it until it was essentially “gifted” .. but even then China demanded Pakistan provide roads/electricity before it would accept. It still sits essentially essentially unused – no clients/demand – no substantive warehousing capabilities – no oil offloading capability – no railroad – no airport – not even enough water to supply the town. It’s a small port with limited capabilities that the Establishment wants – so the media stays quiet.
    .
    Further – despite the rhetoric – CPEC ain’t about trade. There won’t even be a railway from Gwadar to China until 2030 …. the money is going to power plants built by Chinese under “no bid” deals where the terms of the repayment aren’t disclosed to the public. That should make everyone worries … but someone it doesn’t … what’s up with that?Recommend

  • Sami Shahid

    We need to train our people so that they can work in Gwadar and Gwadar industrial zone…we need to send back Afghan refugees and secure our border with Afghanistan. We need to re-visit our visa policy for Afghanistan. We need to promote tourism on international media and should develop tourist sites in all provinces.Recommend

  • Milford

    This guy talks sense. Take care of yourself brother. Who knows what if your establishment might have in their disposal for you mere mortal being.Recommend

  • truthhurts

    Surprised ET published an article which questions CPEC – suspect there are plenty of comments but ET has decided not to publish them .. maybe ET feels it has stretched the limits of “free press” enough for the day?Recommend

  • Aqeel khan

    very good article – writer forgot to mention the main motive behind CPEC i.e. to secure an alternate western route for china if there is some war kind of situations in south china sea from where all its exports and oil imports are passed through. Also China’s western Xinjiang province is under developed and sometimes they feel deprived and few of them involved in anti government activates, East Turkmenistan Movement is one example of it.Recommend

  • AshrafChopan

    So you mean to say that Pakistan shouldn’t have allowed CPEC in first place?
    And what would’ve Pakistan being doing then economically?

    CPEC isn’t a cure-all but it is shot in the arm for debilitating Pakistan economy.Recommend

  • shaan

    Pakistan and CPEC are center of the world. The clock manufacturers in Switzerland are more concerned about CPEC than the precision of their clocks, and drug dealers in Mexico are planning to relocate their businesses to Gilgit-Baltistan. Indeed Pakistan is on Mars it is the purest of pure.Recommend

  • Lalit

    False dawn….or may be the light at the end of the tunnel is an incoming freight train at full speed….its not for first time that Pakistan has cheered for their own downfall.CPEC is going to make the process of colonalisation of Pakistan complete…Recommend

  • Sane

    Good governance free from corruption is pre-requsiite to reap benefits of CPEC.Recommend

  • Sane

    These Indian trolls are always jealous. India is plunged into economic crisis, killing for beef eating, raping women, killing minorities etc. They are wasting their leftover energies to be a looser. Their hungry and naked population have no light at the end of the tunnel.Recommend

  • Hassaan Ali

    very honest opinion and raises some very genuine questions about CPEC.Recommend

  • Hassan

    The respected writer forget that out of USD 42 billion, only USD 8 billion is allocated for road and railway infrastructure. Substantial part is allocated to energy and free economic zones. Which will generate jobs and have long-term sustainability.Recommend

  • Hassan

    Mr. Writer is an Electrical Engineer. It means that he may not have the knowledge of economy of a country and how it works. With regardsRecommend

  • Michael Scot

    “I think that we are like stars. Something happens to burst us open; but when we burst open and think we are dying; we’re actually turning into a supernova. And then when we look at ourselves again, we see that we’re suddenly more beautiful than we ever were before!”Recommend

  • Michael Scot

    “We’re so self-important. So arrogant. Everybody’s going to save something now. Save the trees, save the bees, save the whales, save the snails. And the supreme arrogance? Save the planet! Are these people kidding? Save the planet? We don’t even know how to take care of ourselves; we haven’t learned how to care for one another. We’re gonna save the planet? . . . And, by the way, there’s nothing wrong with the planet in the first place. The planet is fine. Compared with the people, the planet is doin’ great. It’s been here over four billion years . . . The planet isn’t goin’ anywhere, folks. We are! We’re goin’ away. Pack your shit, we’re goin’ away. And we won’t leave much of a trace. Thank God for that. Nothing left. Maybe a little Styrofoam. The planet will be here, and we’ll be gone. Another failed mutation; another closed-end biological mistake.”Recommend

  • Zahid Khan

    Adivasis have been designated by other terms as well, most of them derogatory, such as jangli (“jungle person”). In India some caste-Hindus, disputing the adivasi claim to be indigenous, now prefer to call them vanvasis, “forest dwellers.”Recommend

  • jay

    Sane — Even if Indian economy falls 10 times over it will still be 10 times better than Pakistani’s ! People lie u remind me ” Bheek Mein Roti who bhi garam “Recommend

  • Michael Scot

    The system confers on the ‘higher’ castes the absolute right to plunder the wealth of those belonging to the ‘lower’ caste or Dalits (or the ‘untouchables’). For over four thousand years, the system has been driven by the intense hatred and by the yearning of the ‘higher’ castes to accept nothing less than abject subservience from the ‘lower’ castes. Ironically, its defenders have argued that it has kept a sense of order and peace among the people and has prevented society from disintegrating into chaos.Recommend

  • Omair

    Excellent analysis – the last statement sums up the whole CPEC drama. I find it amazing how gullible our nation is. In the 90’s it was Nawaz Sharif’s qarz utaro scheme, which only resulted in masses getting poorer and NS getting richer. Its CPEC now… I hope we can learn from the past and stop believing our leaders…Recommend

  • Gingerman78

    Chinese are not known for their altruism. They want to export what they produce. Due to the massive scale of their production, labor conditions and currency manipulation, it is impossible for local producers to compete against Chinese imports.Recommend

  • deepu

    Name few Pakistani companies which won contracts under CPEC funding. With more than half of those billions already spent, what is the current contribution percentage of CPEC to Pakistan Job market? Please enlighten your readers.Recommend

  • sukkur saheb

    “The system confers on the ‘higher’ castes” Mr.Michael Scot, when you escaped from Mental hospital? Please get readmitted immediately for your own health.Recommend

  • Tommy Gunn

    Finally a rational and dispassionate analysis of the CPEC by an intelligent Pakistani.Recommend

  • Purna Tripathy

    finally some one is talking sense. Even Mr Sartal Aziz has said “China will allow Pakistan…” (news in this news paper)Recommend

  • vinsin
  • vinsin

    10000 Pakistani Jobs.Recommend

  • vinsin

    China has oil reserves close to 3 months. China gets maximum oil from Russia. CPEC has nothing to do with oil transport. Burma is better option.

    https://en.wikipedia.org/wiki/Sino-Myanmar_pipelinesRecommend

  • vinsin

    It is controller by establishments.Recommend

  • vinsin

    higher caste cannot have any wealth. Caste system implemented in 1860 by Britishers not some 4 thousands yrs back.Recommend

  • Sudhanshu Swami

    The world is run by those who use that route – not by those who collect the toll tax…. AppreciationsRecommend

  • singh

    “International Monetary Fund’s Resident Representative Tokhir Mirzoev told the audience that Pakistan had to attain 15% per annum growth in exports for the next five years to pay off the CPEC-related liabilities.”
    And he told this in Pakistan. Can somebody enlighten me, which product Pakistan will export to gain 15% growth to pay back this loan?Recommend

  • singh

    How many fake id you will create for different news to post same comment.
    Read news then read your own comment to find any relevance with news itself.Recommend

  • abc

    In reality, India’s GDP grew faster than China’s last year and was the fastest of any G20 country. Feel free to check that with World Bank, IMF, whoever you like.

    To put it in perspective, the total GDP of Pakistan is equal to the GDP of Maharashtra. But you keep living in your fantasy.Recommend

  • abc

    Close, but I will fix it for you.

    Plunged into economic crisis, killing for no reason, blasphemy laws, raping women, jailing rape victims, woman’s testimony worth half a man’s, killing minorities (including Shias), does not regard Ahmadiyyas as Muslims, bombing mosques etcRecommend

  • abc

    What China will get from this is access to an additional trade route to West Asia, Africa and Europe, development for the western regions of China, construction contracts for Chinese companies, and employment for Chinese workers.

    What Pakistan is going to get from this is a lot of loans to pay back, Chinese control over vital infrastructure and a portion of the economy, and large headache and cost in terms of providing security to CPEC facilities and Chinese workers. It is also possible that the influx of cheap Chinese imports will render the domestic manufacturing sector unable to compete. Assuming China doesn’t fill up Gwadar with their own people, Pakistanis may get a few thousand jobs at the port.Recommend

  • abc

    Have you tried self-reliance? Have you tried investing in your country and your own people? That is what almost every other developed/developing nation did, including your neighbour and China. Neither of them was blessed with oil money or any get-rich quick scheme. They actually did the work of development.Recommend

  • abc

    Jealous of what exactly? With “friends” like China, you don’t need enemies!Recommend

  • liberal-lubna-fromLahore

    please move to US if u hate pak so much and expect to die there in a random hate crime/shooting

    my dad says who works for CPEC says loadshedding will end in Pak in 2034.
    Pakistanis just cant digest this positive news for Pakistan and thats why write such hate mongering blogs for PakistanRecommend

  • Salim Alvi

    Rentier Pakjabi state is renting out land and shore which does not belong to it. Chinese need to work out a deal with Baloch and Pakhtun people. Why should Chinese give their hard earned money to Pakjabis? India can join the route after getting back Gilgit Baltisthan. Thus every one will be happy. India will get access to Afghanistan, Central Asia and Western China and China another route to India. Let us keep Pakjab out of it. Pakjab has been a nuisance to all its neighbors.Recommend

  • test

    For CPEC to succeed, Pakistan is the major internal factor and China is just an important external factor.

    If Pakistan handles rightly, CPEC can do good to Pakistan even if China is selfish in its intention. But if Pakistan handles improperly, CPEC can do no good or even bad to Pakistan even if China is out of goodwill.

    At last, CPEC may prove itself half success or half failure…Try the best but prepare for bad…Recommend

  • BNS

    @AshrafChopan, it is doubtful whether CPEC is going to be a shot in the arm or Pakistan has shot itself in the foot, signing up for the current terms of loan from China. Pakistan really needed some experts to negotiate the terms of the loan. I will give you the example of the Hambanthotta port built in Sri Lanka with Chinese loan. With a huge $ 8 billion bill, Sri Lankans are now struggling to renegotiate their deal with the Chinese. They may end up long term leasing the port to a Chinese consortium at a paltry $ 1 billion. The probllem with Pakistan is that there is nobody in your country to question the civil/ military top brass whether a certain deal is beneficial to the country in long run or not. The people are swayed into believing that anybody who questions the CPEC is traitor, or worse, RAW agent. The CPEC is certainly NOT the game changer it is tooted to be. I would be happy for Pakistan if I am proved wrong.Recommend

  • Biased

    Interesting analysis, mostly worst case scenarios dealt with-which is a useful point of departure.
    The most poignant part of the article is; “CPEC is a trade route. If trade routes can turn the tables for nations, Egypt would have been the world’s biggest power as it controls the Suez Canal which alone generates billions of dollars in revenue. The world is run by those who use that route – not by those who collect the toll tax.”

    It is true that Suez is a huge income earner for Egypt. It is also true that economically Egypt is far better off than Pakistan is at present. In order for Pakistan to attain parity with Egypt creating this infrastructure will certainly help. At this particular moment in time, there is no other source of $50 Billion dollars infrastructure investments available to Pakistan-and Pakistan badly needs investment. Pakistan may not become a “World Biggest Power” because it is geographically, population-wise, industrially and in terms of brain trust / technical innovation lacks overwhelming advantages. But going back into history Venice was a key trading center on the Silk Route which enabled it to become very prosperous and wealthy. Wealth allowed Venetians to gain influence and power in Europe just like UAE and Singapore are beneficiaries of trade through their home ports. It will be up to Paks’ ingenuity to create wealth and prosperity from a busy port and use that national wealth to gain international influence. No one else can do it for you.Recommend

  • shaan

    It seems that UFO’s are also interested in CPEC, apart from Russia, Italy, Turkey, UK, France, New Zealand. UFOs may be planning to re-charge their batteries at CPEC, China made.Recommend

  • Sane

    Enjoy your 100 time or 10 time better economy. We don’t bother. Don’t poke your nose in matter of others. You are scared if Pakistan progresses. We are not bothered if you progress 1000 times or millions of times. But, you must foresee your direction of dive and be realistic. Your hungry population even do not get BHEEK. Live in illusions, your choice.Recommend

  • Sane

    We have caught many and others shall be nabbed shortly.Recommend

  • Sane

    How your GDP benefited hungry and naked Indian population. GDP on paper; just an illusion unless its comes in the life of commons. Don’t make fool to your people by the term GDP. They don’t understand. They know that their own money has no value and they are not able to buy common food items.Recommend

  • Asad Khan

    …. This article uses -ve counter arguments augmented against a fact which in return generates “noise” in order ascertain which “areas” in Masses needs to worked upon (or should I say educate upon).

    (PS : Just a casual look on most of ET Bloggers writing pattern is enough)
    regards,Recommend

  • Sane

    same as you don’t need any enemy if you have prime minister like Modi.Recommend

  • sterry

    The fact that Indians are so desperate to minimize the value of CPEC speaks volumes. Not only is CPEC a game changer as a transit route but along the way, it can spawn many centres for manufacturing and industry. It should be viewed as a whole. The Suez Canal is a shipping route; this is a land route where Chinese goods can travel and manufacturing goes wherever costs are cheaper in terms of labour. Nothing is preventing the Chinese from setting up factories and industrial zones along the way which is happening. You forget that the greatest part of CPEC is the investment in energy production which will end the electricity shortfall for industry. Baluchistan is far safer if you check statistics despite efforts from Indian agents in Afghanistan to destabilize the area. It is not working since every Baluch I see is excited about what CPEC will do for their province. After all Baluch are being given preference in terms of local hiring. Let the Indians worry and cry and obsess all they want while Pakistan keeps building it !Recommend

  • sterry

    You forget one very basic fact. The people of Gilgit Baltistan as well as Azad Kashmir are Pakistani citizens of the first rank and they themselves revolted against the Dogra rule and liberated themselves. They are also in large numbers in Pakistani forces unlike India which needs million soldiers to crush people in Indian occupied Kashmir. Don’t you think the same people who fought for freedom against India would fight you again? While you obsess about Pakistan, would it not be better to build a toilet for the people of UP?Recommend

  • Mubashir Jamel

    bhutos and jinnah r shia so r man high level general and civilian officersRecommend

  • Mubashir Jamel

    loans r @ below 2% markup and we r negotiaing 4 1% most project r 4 energies pro which is 1st need of industriesRecommend

  • genesys

    Sound analysis.China ash to find markets for its overproduction which has no demand within their country.Madagascar has started protesting against china and they had to leave.This will be the trend across other places increasingly. China is the new carpetbagger…Recommend

  • HZR

    There is caste system in muslims as well and you cannot have an ostrich outlook.Recommend

  • disqus_MKeynes

    Great analysis..not done by any before. Example of Suez Canal was awsome as was the question- Was Baluchistan peaceful before CPEC. You hit it on the nail that this is for China thru and thru, the secondary and tertiary benefits that will accrue to Pakistan are too insignificant and will be outweighed by the further loss of domestic industry which will actually be wiped out. Truth be told- the main advantage is to Pakistani generals and civil rulers who want to maintain their ‘gaddi’ over Pakistan and are fearful of coming internal storms (loans becoming due and Pakistan’s inability to pay, lack of jobs, food, ISIS penetrating Pakistan) and external threats from US, etc. The Chinese must have guaranteed some sort of cover. The other main advantage is to China and Russia for military purposes since in the event of war and otherwise too, they need access to Arabian Sea waters and Middle east for armies to march through. The sad thing is that all this is going to be achieved on Pakistan’ dime. The old technology, cheap thermal coal based plants offered to Pakistan are the cheapest form of electricity investment that China could provide knowing fully of Pakistan’s inability to pay back a single dime. Chinese would need a lot of assured electricity along the 2000 miles route. As the author said- this is a project designed for China by China at payment terms that Pakistan can’t afford, with only a small 10 billion dollars thrown as grant, a sop to buy over the dim-witted Pakistani politicians and generals…the complete control of this route is thus assured to the Chinese..Pakistanis never learnt any lessons from the colonial history…they might as well have made India their mentor and advisor who would have helped make Pakistn right decisions on a timely basis.Recommend

  • disqus_MKeynes

    Does Pakistan have a dying need for this CPEC infrastructure or only for a part of it? Does Pakistan have a need for other investments- education, tax collection, dams, electricity, manufacturing, teacher’s training? Did Singapore or Dubai become prosperous only on account of being a trading port or because they build themselves up according to a plan? Could Pakistan have taken loans and used Pakistani 100% labor to build roads and lay railway tracks? Could India have given loans on easy terms to Pakistanis and actually help build up their important infrastructure had Pakistanis not treated India like an enemy? Ofcourse the answer is ‘Yes’ to the last one.Recommend

  • disqus_MKeynes

    What is the use of this CPEC infra to Pakistan if it is not in a position to use it or build upon it for many many years? As it is, it cannot pay for even basic government expenses and it has started renting out land, airports and other assets.Recommend

  • disqus_MKeynes

    Moderator, why have you rejected 2 of my earlier comments? If you don’t like any particular sentence, please feel free to remove it. The only objectionable thing I can think of is my mention of “Pakistani generals and civilian rulers”.Recommend

  • disqus_MKeynes

    What makes you think that Chinese will setup manf units in Pakistan along the route or that Pakistani govt of the day will find money or interest to do it? Indians are giving their analysis just as many Pakistanis- students or seasoned journalists inlcuding senators and generals like Musharraf have given on CPEC.Recommend

  • disqus_MKeynes

    Investment in electricity (using old technology at expensive interest rates) is being done not for the good of Pakistan but for getting the necessary 24 X 7 electricity for the 2000 mile route on an uninterrupted basis.Recommend

  • syed ali

    Lmao, Egypt dont control Suez Canal. Suez Canal is control by its Shareholders such as UK and other countries.
    check the Video of How Rothschilds Control the suez canal by Benjamin Deisraeli. https://www.youtube.com/watch?v=heEUMXmeHI8
    Egypt dont have the power to do any politics and manipulations over it. or otherwise the United nations will take action , even the Arab countries will take action against it
    now when it comes to CPEC , China have Some shares in it not all, which is beneficial for pakistan because CPEC is all over Pakistan and Danger to pakistan means Risk for China and china will do anything to protect its future. like america do.
    Recently, Donald Trump a mysteriously sudden president who is also a billionair become president of the United state out of now where. who had no similarities with politicians. then when he become the president he is calling China a Currency manipulator, Making good relations with taiwan, Russia and increasing its proxies on Korea.
    then he suddenly Calls the prime minister of Pakistan and Praise him. and then he say Pakistan is a fantastic country with fantastic peoples and the land with great opportunities. (noted)
    you see the pattern ?
    while that same Donald Trump saying Pakistan as a biggest enemy many times before in the media Recommend