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A successful visit of Chinese delegation

A new chapter of close cooperation between Pakistan and China is expected to be opened in many fields

Apr 16 - 22, 2001

As was expected, the week-ong visit to Pakistan of a 15-member Chinese delegation headed by the Vice Minister of Foreign Trade and Economic Cooperation has proved highly successful as the representatives of the two countries identified many new areas of economic cooperation and boosting mutual trade.

As a result of this visit a new chapter of close cooperation between Pakistan and China is expected to be opened in many fields specially in the field of science and technology, advancement of information technology and several other viable scientific programmes in Pakistan besides heavy engineering and development of ports etc.

Before the arrival of the Chinese delegation, the Chief Executive Gen. Pervez Musharraf, while presiding over a cabinet meeting, reportedly instructed the Planning Commission to formulate suggestions for expansion of relationship with China, specially in the economic field. He asked them to have in depth discussion with the visiting Chinese delegation and identify specific projects of mutual interest so that these plans could be discussed and crystallized on the eve of impending official visit of Chinese Prime Minister next month. He said there were strong indications that the Chinese trade delegation was here in Pakistan to explore new avenues of investment in heavy engineering, communication and construction projects besides in the field of science & technology.

Pakistan is keen to develop deep strategic economic relation with China investing in large scale development projects. These issues were discussed on Friday last in a high level meeting between economic team of Pakistan led by Finance Minister Shaukat Aziz and 15-member Chinese delegation headed by An Min, Vice Minister of the Ministry of Foreign Trade and Economic Cooperation. These talks took place ahead of the Chinese Prime Minister's visit to Pakistan next month. Though there are close relations between the two countries, particularly in the defence production, this does not fully reflect in the economic sector.

In recent months, the volume of trade had inched up a bit, but still there is a huge untapped potential.

Two sides have conducted various studies, and exchanged many proposals on the subject. Mr. Aziz discussed a number of projects with the Chinese team, which two sides can jointly undertake. He also discussed import of textile machinery from China, possibility of long-term financing, and urged the need of closer cooperation between financial institutions of the two countries. China is also likely to rollover a $500 million loan to Pakistan to help stabilise the balance of payments situation. Pakistan has also sought Chinese help to deal with the threatening drought situation. China would also help Pakistan in the agriculture sector, particularly in the development of high yielding rice varieties.

Since the Joint Economic Committee (JEC) meeting of May 2000, two sides are trying to work out a strategy to strengthen economic relations. After this JEC, China indicated possibility of financing of various projects, like rehabilitation of Pakistan Railways, construction of Gwadar Sea Port and expansion of Pakistan Steel Mills. Chinese companies would also examine the possibility of reinvesting in Saindak copper refinery.

Pakistan and China agreed to explore the possibility of enlarging cooperation in the field of telecommunications, agriculture, information technology, urban planning, transportation, oil & gas and large infrastructure projects. China would also encourage its corporate sector to build small and medium size hydro power plants in Pakistan.

China would also expand its technical cooperation with the Pakistani state-owned enterprises, including Pakistan Steel Mills, Aeronautical Complex, Heavy Rebuild Factory, Heavy Mechanical Complex, Heavy Electrical Complex, Pakistan Machine Tool Factory, Pakistan Railways and, Oil and Gas Development Corporation (OGDC). Official sources claimed that China has agreed to narrow down bilateral trade deficit, which is heavily in favour of China at present, and would assemble and manufacture small agricultural machinery and household electric appliances in Pakistan.

Pakistan expects that visit of Chinese Prime Minister would open the door to a large Chinese investment in Pakistan, particularly in the large-scale development projects. Foreign Minister Abdul Sattar is also likely to visit Beijing by next week, and another senior level Chinese delegation is due in Islamabad ahead of the visit of the Chinese Prime Minister to Pakistan.

It will be noted that the efforts being made by Pakistan for retrieval of its economy from the rock bottom it was found lying a couple of years ago, stand badly hampered from a number of weak spots left in the process of development over the past several decades. That these also include the areas now focused by our Chinese friends, should be all the more welcome. It is largely because of the basically flawed approach of the past several governments in a row to the vital issues of economic development and trade, that the ongoing reform has continued to leave a great deal to be desired. For the expected good results from efforts for improvement in industrial production and export promotion are generally offset by the lacunae in the infrastructure and vital economic prerequisites. The sectors as now identified for investment and promotion, can easily be seen as plagued by the neglect of the past and hence demand spirited efforts for revival.

The seriousness of the Chinese government in pursuing their initiatives, in this regard, should be evident from the fact that the forthcoming visit of the strong exploratory delegation, led by An Min, Vice-Minister of Foreign Trade of China, is scheduled to be followed by the visit of Chinese Premier Zhu Rongi in May. It goes without saying that Premier Zhu's talks with Pakistani leaders on wide-ranging issues can help in consolidating the results of the earlier discussions and thus pave the way for formal agreements of cooperation in accordance with the mutual interest of the two countries.