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CPEC – Layman perspective or mix of trade activities

China-Pakistan Economic Corridor popularly known as CPEC is the talk of the town in Pakistan. Everything happening in the region, especially in Pakistan, is attributed to and seen in the perspective of the CPEC projects. Whereas, political parties and politicians are anxious to reap its fruit for the benefit of their areas and constituencies, common person from every walk of life including even street hawkers and cart pullers are also keen to know about its importance in improving value of their life. The best thing about CPEC is that all parts of the country including Gilgit-Baltistan, Khyber Pakhtunkhwa (KPK), Punjab, Sindh and Balochistan would be benefitted by this corridor.

CPEC is infact part of the development strategy, One Belt & One Road (OBOR) Initiative, proposed by China’s President Xi Jinping in 2013. The cornerstone of CPEC is to develop regional connectivity to ensure economic regionalization. The improved infrastructure including road, rail etc would not only add to the agility of the trade but would also connect the people of the region by facilitating the exchange of academic and cultural delegations and regional information. CPEC is expected to be truly a win-win cooperation scheme that would not only benefit the China and Pakistan but the whole region including India, Iran, Afghanistan, and Central Asian countries would also be the beneficiaries of the resulting infrastructure and improved trade flows. The completion of the CPEC would add to the geo strategic importance of Pakistan and the region.

A common person is generally interested in job creation, better infrastructure, education and business opportunities. CPEC has all these four ingredients. CPEC would not only beconnecting the people by providing them the roads and rails to commute swiftly but also provide related infrastructure creating jobs and opportunities to learn and apply the business skills.

Originally valued at US$46 billion the value of the CPEC projects have now increased to US$62 billion. CPEC would add about 4000MW to the national grid helping the people of Pakistan to get uninterrupted power supply for their homes and business. It would provide thousands of kilometers of road network, expansion and reconstruction of about 1,830 Km railway lines, Gwadar port to facilitate sea trade.

Gwadar is likely to be developed as one of the major cities of Pakistan having Airport, University and Vocational Training College etc. Rail based mass transit projects like Karachi Circular Railway, Greater Peshawar Mass Transit, Quetta Mass transit, Orange Line Lahore are also indebted to CPEC. Special Economic Zones are also being developed to facilitate the regionalbusiness and trade.

Despite having all the above advantages and prospects of economic growth, CPEC is also target of criticism by certain sections of the society. The criticism is mainly of two types, one related to the sovereignty of our country and other to its impact on local business.

Some analysts think that CPEC would intensify the influence of China in Pakistan and it would turn it into a kind of colony of China and they quote East India Company as an example of economic strength and control subsequently resulting in taking over of the regime. Others think that this would strengthen the economic hold of the Chinese business in Pakistan eventually driving Pakistani business people out of the business arena by relatively high economic strength of the Chinese business people. This is likely to result in taking over the main business especially the major industry by Chinese business giants.


Both these apprehensions are valid and have a point worth considering and cannot be rejected or ignored outright. The Government of Pakistan is duty bound to ensure that the sovereignty of the country is not compromised at any cost and the rights and interests of the local businesspeople are protected by providing them equitable level playing ground. Even World Trade Organization (WTO) does not stop governments from protecting their local industry. As such, permissible tariff and non-tariff barriers can be developed by deliberations and mutual consensus of all the stakeholders. It should be ensured that the local businesspersons and traders are not deprived of their legitimate business interests. Developing strong, reliable checks on the grey market and dumping by the Chinese companies would be the first basic step to protect the local business. However, these checks and measures should be devised carefully enough not to be perceived as trade barriers rather should be regarded as effective trade management tools. This may be accomplished mutually by constituting working groups comprising all the stakeholders to take such measures by consensus.

CPEC is a mix of economic activities providing diverse investment opportunities, venues of industrial collaboration, energy cooperation and improving livelihood opportunities for the common public.

CPEC’s Vision & Mission Statement sums it all as:

To improve the lives of people of Pakistan and China by building an economic corridor promoting bilateral connectivity, construction, explore potential bilateral investment, economic and trade, logistics and people to people contact for regional connectivity.

Success of CPEC would be a game changer especially for Pakistan and China and for the region in general. Impact of the CPEC & OBOR would not be confined to the region but effect the global economy and the international business dynamics. The analysts while criticizing CPEC should remember that there is no free lunch as economists say. CPEC would definitely be a boon for Pakistan, strengthening it strategically, economically, and enrich it socially but seeing it in solitariness just from Pakistan or China’s interests would undermine its importance. CPEC is infact a quid pro quo arrangement between China and Pakistan meant to enhance and serve the mutual benefits. This would certainly require some tradeoffs from both Pakistan and China. The challenge for the government is to negotiate these tradeoffs so pragmatically that we can take maximum out of this scheme with minimum possible compromises on our strategic and economic interests.

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