CPEC confusion

Published September 11, 2018

When the new government sat down with the Chinese to ‘renew’ cooperation under the CPEC project, the day was marked more by confusion than fanfare.

It all began with the report in the Financial Times which quoted the prime minister’s commerce adviser Abdul Razak Dawood as saying that CPEC “unfairly benefits Chinese companies” through tax breaks and many other incentives that are unavailable to local counterparts. Not only that, he went on to say that the deals under CPEC would be reviewed, adding that “we should put everything on hold for a year so we can get our act together”.

These words were published on the same day as the country heard that Chinese and Pakistani delegates sat down together, and after a long meeting, agreed to broaden the base of the CPEC arrangement as well as open it up to involvement by ‘third countries’ that might be friendly to both China and Pakistan.

Unfortunately, the two messages did not mix well. Soon a ‘clarification’ arrived from the commerce adviser, asserting that he was “quoted out of context”. This, of course, begs the question what the original context was since the words uttered by him are quite clear.

While both governments spoke of renewing ties, broadening the base of their cooperation and inviting others to participate in their bonhomie, at least one of the ministers let it slip that there are powerful apprehensions about the entire deal within Pakistan. Long before we heard the words of the commerce adviser, who hails from the business community, we have heard various trade and business bodies articulate the very same concerns in very similar language.

Going forward, it is necessary to heed the substance of both voices that spoke on Monday. There is no doubt that CPEC should continue, and certainly grow with time. China is arguably Pakistan’s most important neighbour and has been a consistent friend through the decades. But as we move forward, it is important that Pakistan’s own interests, and political traditions, be kept front and centre.

To what extent does the new government wish to heed the voice of the business community when formulating its approach to CPEC? How far is the new government willing to go to honour its commitment to the electorate to conduct an audit of some CPEC projects like the Orange Line train, or to bring greater transparency to future CPEC negotiations such as those around the ML 1 project, or to place details of past agreements before parliament?

All of these are commitments made by the PTI before and after the election and we need to know where they stand today. Following Mr Dawood’s remarks, the Chinese embassy in Pakistan also issued a strongly worded reaction denying the interview altogether. It is clear that the time to choose the future course of CPEC has arrived.

Published in Dawn, September 11th, 2018

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