The new track will support increased axle load of up to 25 tons, up from 22.8 tons which is now the norm in South Asian countries. The higher axle load capacity will allow heavier freight trains carrying more freight per train for greater trade overland.
China will provide 85% of the financing for the project. It will be done in two phases, with the first due for completion in December 2017 and the second in 2021.
It will be part of an international rail link that will connect Pakistan with China, Russia, Central Asia and Europe. It will extend south from the city of Kashgar in the Xinjiang Uygur autonomous region in Western China to Pakistan's deep-sea Gwadar Port on the Arabian Sea, according to Zhang Chunlin, director of Xinjiang's regional development and reform commission.
|Source: China Daily|
"The 1,800-kilometer China-Pakistan railway is planned to also pass through Pakistan's capital of Islamabad and Karachi," Zhang Chunlin said. "Although the cost of constructing the railway is expected to be high due to the hostile environment and complicated geographic conditions, the study of the (international rail link) project has already started," Zhang said. "China and Pakistan will co-fund the railway construction. Building oil and gas pipelines between Gwadar Port and China is also on the agenda," Zhang added.
The Pak-China link announcement was part of the discussion on China's broader effort to revive the historic Silk Route by building three main corridors through southern, central and northern Xinjiang to connect China with Russia, Europe and Pakistan. The Silk Road Economic Belt International seminar which concluded on Friday in Urumqi, Xinjinag was jointly sponsored by the State Council Information Office, China International Publishing Group (CIPG), China Academy of Social Sciences (CASS) and Xinjiang Academy of Social Sciences.
In a 2013 report, China's State-owned Xinhua News Agency articulated China's motivation to expand land trade in addition to building its navy to protect its sea trade. Here's what it said:
“As a global economic power, China has a tremendous number of economic sea lanes to protect. China is justified to develop its military capabilities to safeguard its sovereignty and protect its vast interests around the world."
The Xinhua report has for the first time shed light on China's growing concerns with US pivot to Asia which could threaten China's international trade and its economic lifeline of energy and other natural resources it needs to sustain and grow its economy. This concern has been further reinforced by the following:
1. Frequent US statements to "check" China's rise. For example, former US Defense Secretary Leon Panetta said in a 2011 address to the Naval Postgraduate School in California: "We try everything we can to cooperate with these rising powers and to work with them, but to make sure at the same time that they do not threaten stability in the world, to be able to project our power, to be able to say to the world that we continue to be a force to be reckoned with." He added that "we continue to confront rising powers in the world - China, India, Brazil, Russia, countries that we need to cooperate with. We need to hopefully work with. But in the end, we also need to make sure do not threaten the stability of the world."
|Source: The Guardian|
2. Chinese strategists see a long chain of islands from Japan in the north, all the way down to Australia, all United States allies, all potential controlling chokepoints that could block Chinese sea lanes and cripple its economy, business and industry.
|Karakoram Highway-World's Highest Paved International Road at 15000 ft.|
Chinese Premier's emphasis on "connectivity and maritime sectors" and "China-Pakistan economic corridor project" is mainly driven by their paranoia about the US intentions to "check China's rise" It is intended to establish greater maritime presence at Gwadar, located close to the strategic Strait of Hormuz, and to build land routes (motorways, rail links, pipelines) from the Persian Gulf through Pakistan to Western China. This is China's insurance to continue trade with West Asia and the Middle East in case of hostilities with the United States and its allies in Asia.
|Pakistan's Gawadar Port- located 400 Km from the Strait of Hormuz|
As to the benefits for Pakistanis, expanded trade and the Chinese investment in "connectivity and maritime sectors" and "China-Pakistan economic corridor project" will help build infrastructure, stimulate Pakistan's economy and create millions of badly needed jobs.
Clearly, China-Pakistan ties have now become much more strategic than the US-Pakistan ties, particularly since 2011 because, as American Journalist Mark Mazzetti of New York Times put it, the Obama administration's heavy handed policies "turned Pakistan against the United States". A similar view is offered by a former State Department official Vali Nasr in his book "The Dispensable Nation".
Comparison of Chabahar and Gwadar
How Strategic Are Pak-China Ties?
Gwadar as Hong Kong West
China-Pakistan Industrial Corridor
US-Pakistan Ties and New Silk Route
Can Pakistan Say No to US Aid?
Post Cold War Shifting Alliances
the gauge used in china is standard gauge (4'8in) and the one in Pak is broad (5'6in). How will it work without costly change over of goods and services. #justasking
RK: " the gauge used in china is standard gauge (4'8in) and the one in Pak is broad (5'6in). How will it work without costly change over of goods and services."
India itself has significant lengths of four different gauges: 5 ft 6 in (1,676 mm) Indian gauge, 1,000 mm (3 ft 3 3⁄8 in) metre gauge, 2 ft 6 in (762 mm) gauge and 2 ft (610 mm) gauge. How do you deal with it?
As to international rail links with China, the country handles them with double-tracking to accommodate more than one gauges at borders. It does so with Mongolia and Russia now.
Oh you have not heard of "project unification" of gauge (https://en.wikipedia.org/wiki/Project_Unigauge) and now nearly complete. It was done for precisely the same reason. To avoid costly change of gauge charges. The meter gauge (1000m) has virtually disappeared and converted to predominant broad gauge. Today broad gauge is about 96% of all tracks.
THe other two narrow gauge are primarily left in the mountain areas as heritage trains meant for tourist.
Also Russian and Mongolian are 1520mm. India and Pakistan gauge is 1676mm. So obviously cpec trains can't use tracks meant for russian route.
It will be interesting to see how china tackles this gauge difference.
Excerpt of UNESCAP document "Development of Trans-Asian Railway" re cross-border train service issues in Asia:
Since the attraction of container traffic to the TAR (Trans-Asian Railway) network depends in large measure on
rail being able to deliver a cost effective and reliable service as compared with its
competitors in the corridor, it is essential that any operational impediments to realization of
these goals be removed.
In this context five factors are important:
(i) Compatibility in terms of the type and design of rolling stock employed by
neighbouring railway systems in international traffic would ensure rolling stock
inter-operability when no break-of-gauge is involved. Ideally, systems should
cooperate in the design of exchangeable rolling stock to ensure that only the
most efficient designs (i.e. those which maximize payload to tare ratios or
minimize gross to net ratios, and are capable of running nearly at passenger
speeds) are adopted;
(ii) Compatibility of train assembly and load scheduling practices between neighbouring
railway systems will be essential in order to avoid the necessity of having to readjust
train loads at borders. The desirability of operating fixed formation unit
trains across borders, where track gauge continuity permits, should be
recognized and acted upon by the responsible systems;
(iii) The presence of adequate route capacity on existing links in the TAR corridor will be
essential if the corridor is to meet its objective of providing a cost effective and
competitive means for the international transportation of containers; and
(iv) Breaks-of-gauge while not posing a problem currently, are likely to become a
problem in the future when lines of differing track gauge are connected within the
territory of one country, Bangladesh, and at two borders, China/Myanmar and
Islamic Republic of Iran/Pakistan. Possible re-gauging of the existing metre
gauge network in northeastern India would create two additional breaks-of-gauge
at borders - between India and Myanmar and between Bangladesh and India
(northeast). Provision of modern, high speed container transhipment equipment
at all break-of-gauge points will be essential to minimize delays.
The success of rail in being able to capture additional container traffic for the TAR
network will depend heavily on there being adequate capacity for handling containers at rail
served terminals in the hinterland and at the major sea ports.
Pakiland is going great guns under Shri Nawaz Sharif- power sector, reforms, CPEC and now this. You used to make fun of me when I used to call Shri Nawaz Sharif the vikas purush of Pakiland. But for once, sir, I have delivered a KO blow to you!
#Pakistan shares end higher ahead of #MSCI announcement to upgrade country to #EmergingMarkets status http://reut.rs/1VUulOH via @Reuters
Pakistani stocks closed higher on Monday in a volatile trading session ahead of a much-anticipated MSCI announcement on whether the bourse would be reclassified as an emerging market, analysts said.
The benchmark 100-share index of the Pakistan Stock Exchange finished 0.11 percent higher at 36,979.96.
The index clocked in an intraday range of more than 440 points, hitting a low of 36,637.81 in early trading before bouncing back towards the end of the session.
"Market sentiment remained sombre today, in line with sentiment seen in global equities and commodities ahead of central bank meetings in the U.S., U.K. and Japan this week," said Gohar Rasool, head of international sales at Inter Market Securities Pvt Ltd.
MSCI is due to announce whether it will be reclassifying Pakistan as an emerging market on Tuesday.
The stock exchange was dropped from the MSCI Emerging Markets Index in 2008, but Pakistan has in recent months launched a final push to get back in so it can vastly expand its pool of potential investors.
Among index heavyweights that gained on the day were Engro Fertilizers Ltd, MCB Bank Ltd and Fauji Fertilizer Company Ltd.
Oil stocks took a hit as international crude oil prices declined. Oil and Gas Development Company Ltd closed down 0.93 percent while Pakistan Oilfields Ltd was down 0.75 percent.
Traded volume on the day stood at 104.7 million shares, with traded value at 6.67 billion rupees ($63.83 million).
#Asia's new Great Game. #Modi #Afghanistan #India, #Pakistan #Iran #China #US #Chabahar #CPEC #CentralAsia
By Munir Akram
With a population of only around 50 million, Central Asia will not become a huge market for manufactured goods. It will be twice as expensive for India to send goods to Central Asia through Chabahar than it would be overland across Pakistan. Indian goods are thus unlikely to be competitive against Chinese products shipped overland.
Also read: Lessons from Chabahar
The strategic advantages for India are also questionable. Its influence in Afghanistan will be more dependent on Iran. Pakistan’s cooperation will continue to be essential to restoring peace in Afghanistan. Indian shipping lanes to Chabahar will be vulnerable to disruption. India’s limited influence in Central Asia will not dent that of Russia and China.
The new Great Game will increasingly revolve around China’s One Belt, One Road vision of land and sea connections between Asia, Europe and beyond. The China-Pakistan Economic Corridor (CPEC) is the first component of this ambitious project.
In comparison to the Chabahar route, the strategic and economic implications of CPEC are enormous. It will transform China from a one- to a two-ocean power; enable a part of its $4000 billion annual trade to circumvent the Malacca straits and other potential choke points in the Indian Ocean and shorten China’s supply lines to the Gulf, West Asia and Africa. For these reasons, if no other, China has a vital stake in Pakistan’s strategic stability and socioeconomic development. The Chinese commitment of $46bn for CPEC projects is but the first instalment of the massive capital which China is prepared to deploy in Pakistan.
Instead of being distracted by the moves of its adversaries, Pakistan must remain focused on the implementation of CPEC. This strategic enterprise should not be allowed to be stalled or delayed by external pressure or internal politics, inefficiency or corruption. It would be wise to create a separate and independent CPEC Authority which can be a ‘one-stop-shop’ entrusted with achieving CPEC’s enormous potential for Pakistan’s development. CPEC projects must go beyond infrastructure development to encompass manufacture, consumer goods, housing, health, textiles, finance and other sectors. To this end, the interaction between Pakistani and Chinese private- and public-sector companies must be actively expanded and intensified. Some of the externally imposed limitations on CPEC investment projects, such as restrictions on ‘sovereign guarantees’ for debt finance, need to be removed expeditiously.
CPEC faces threats from Pakistan and China’s adversaries. These will have to be met forcefully.
India’s opposition has been announced openly. New Delhi will continue to utilise Afghanistan as a base to destabilise Pakistan and undermine CPEC. The recent spate of attacks on Chinese workers in Pakistan is no accident. Pakistan will have to further enhance security for them and consider direct action to remove the Afghan-based threat from the Tehreek-i-Taliban Pakistan.
Iran has assured that Chabahar is not designed to compete with Gwadar or CPEC. Pakistan and Iran can cooperate for mutual benefit: to end terrorism in Balochistan, expand trade, and construct the Iranian gas pipeline and a Gwadar-Chabahar economic corridor. However, Tehran often wants to run with the hare and hunt with the hound. Some recent events have sent disturbing signals which Pakistan cannot ignore.
To balance the growing Indo-Iranian relationship, Pakistan must maintain and reinforce its relationship with Saudi Arabia and Turkey. It would be in Pakistan’s interest to help in giving substance and form to the ‘Islamic coalition’ hastily formed by Riyadh. It should also convince the GCC states of the benefits of CPEC as a path to their closer connection with China.
America is and will remain a major player in the new Asian Great Game. ...
#Pakistan Railways poised to get massive funding from #CPEC and #CAREC. #China #CentralAsia http://www.pakistantoday.com.pk/?p=559603 via @ePakistanToday
After decades of neglect, a silver lining is on the horizon for Pakistan Railways as it may be able to attract multi-billion dollar investment for the upgradation as well as deployment of new railway infrastructure across the country under two regional economic unions, the Central Asia Regional Economic Cooperation (CAREC) and China Pakistan Economic Corridor (CPEC), to link Central Asia and China with Pakistani ports of Karachi and Gwadar.
An official source said that the Asian Development Bank (ADB) has started the process to assess the financial needs for upgradation of 461 km main line (ML-1) between Lahore and Peshawar, under its CAREC Railway Connectivity Investment Programme. The financing is likely to start flowing form next year.
The Ministry of Railways has already shared plans, under early harvest projects by 2020, to upgrade Karachi-Peshawar main line (ML-1) and extension of ML-2 from Jacobabad to Gwadar via Basima to both CAREC and CPEC. If financing was available, the projects would be completed in relatively short time as the Pakistan Railways has technical expertise to execute the projects, he added.
ADB will be providing multi-tranche financing facility (MFF) to make the railway system more efficient and competitive. Improved railway corridor of Lahore-Peshawar will improve Pakistan Railways’ institutional efficiency. Financial assistance will also be provided for Railways’ modernization, IT-based accounting system and transforming and migrating accounting data into the new accounting system.
Under the plan, 411 km railway track between Lahore-Peshawar section of ML-1 will be upgraded and dualised together with new signaling and telecommunications system, including power supply for these systems, and upgraded passenger facilities at Lahore, Rawalpindi, and Peshawar stations. A 53-km section in the hilly area from Kaluwal to Pindora will have to be realigned and dualised. Except for realignment sections in the hilly tract, it is likely that all the work for rehabilitation and upgradation of the physical infrastructure will be limited to the PR-owned right of way.
Except for Pakistan, railways in all CAREC countries have more freight carriers than passenger tariff. CAREC railways have increased freight traffic volumes which shows the large potential for PR to freight forward to and from CAREC countries. Domestic market is large in Pakistan, Uzbekistan, Kazakhstan and China.
In the past, the railways infrastructure plans always received a cold shoulder from the government, but now the situation has changed as multilateral institutions are interested in linking Pakistani ports with China and Central Asia. Now the government wants to attract investment in railways infrastructure and China is asked to finance upgradation of strategically located ML-1 which connects major population centers in three provinces.
Under CPEC, Pakistan has shared Phase-I (Early Harvest Projects) upgradation of ML-1 (Karachi-Peshawar and Taxila to Havelian) and construction of New Dryport at Havelian (Buldher). In medium term, Phase-II upgradation of ML-2 and extension of ML-2 (Gwadar to Jacobabad via Basima) is proposed. The long term Phase-III seeks establishment of Havelian-Khunjrab-Kashghar rail link.
The source said Pakistan has shared plans to link the Gwadar port Kandahar, Kabul and Dushanbe. The second plan is to link Gwadar with Quetta and onwards to China. He said Pakistan Railways has prepared plans on rail link between Gwadar port and Mastung, Chaman to Kandahar rail link and rail lines between Kandahar and the Tajik border are also planned.
Re the gauge difference problem, there is only one realistic way out, and that is to unify the gauge. As standard gauge is the world's dominating gauge, there is no doubt that this will be the gauge for Asia including the asian parts of Russia. In this latter case and with regard to the length of their existing network it is suggested to divide the network into a home network and and international network, the latter to be built in/converted to standard gauge. Same for CIS states.
#China to lend $5.5 B and ADB another $2.5 billion for #Pakistan's $8 B #Rail link project. #CPEC http://ecoti.in/z8wb4Z via @economictimes
About 75 per cent of the country's (rail) cargo and passenger traffic passes through the 1,687 km-long Peshawar-Karachi rail line.
Earlier, China had agreed to provide $3.7 billion out of the $46-billion CPEC program for the ML-I project and "now it has decided to increase its contribution to $5.5 billion," Iqbal said.
The Asian Development Bank (ADB) would provide $2.5 billion t ..
The Peshawar-Lahore section of the ML-I will be built with the ADB loan.
The rail project would be completed in five to six years after which the rail speed would double to 180 kilometres per hour.
Regional cooperation forum: #CAREC offers avenues for deeper economic links among Stans #CentralAsia #Pakistan #CPEC
ISLAMABAD: Pakistan recently hosted the 15th meeting of the Central Asia Regional Economic Cooperation (Carec), a body working for the collective benefit of the region by promoting economic cooperation.
Pakistan is increasingly looking at Central Asian states in an effort to forge trade links and give a fillip to its dwindling exports. However, so far, it has not been able to tap the full trade potential because of lack of infrastructure for connecting the South and Central Asia regions.
Carec is also pushing ahead with plans to encourage regional connectivity to enhance the trade volume.
In the Carec meeting, more than 200 participants from 10 member states and multilateral development partners participated. The member countries included Afghanistan, Azerbaijan, China, Kazakhstan, Kyrgyzstan, Mongolia, Pakistan, Tajikistan, Turkmenistan and Uzbekistan while Georgia took part as an observer.
Carec is an important forum that encourages regional countries to develop physical networks and infrastructure and ensure peace, stability and economic development.
Strategies and initiatives were highlighted at the huddle to stimulate much-needed investment in energy sector of the member states. After a briefing on selected case studies undertaken by Carec members including Pakistan, prominent investors shared their insights to identify and make investments in energy projects.
Addressing the meeting, Prime Minister Nawaz Sharif appreciated that Carec had mobilised $29 billion for pouring into regional development projects and voiced hope that a mid-term review of the regional body in the next 10 years would prove to be an opportunity to fast-track economic cooperation.
The regional connectivity may lead to economic development and prosperity of the region. In this connection, Pakistan is working on energy projects such as the Central Asia-South Asia 1,000-megawatt (Casa-1,000) power import project and the Tapi gas pipeline that will start from Turkmenistan.
The Casa-1,000 is also going to pave the way for digital connectivity between the two regions through a fibre optic cable network called Digital Casa-I, which will link Tajikistan, Afghanistan and Pakistan.
The existing cable reaches Pakistan after going through a long route. It first goes to Russia, extends to Europe and then comes to Pakistan.
The new project will provide a good route to connect the two regions. It will allow regional countries to become independent while tapping the international internet channels.
In his welcome address at the Carec ministerial meeting on the theme “Linking connectivity with economic transformation”, Finance Minister Ishaq Dar said the China-Pakistan Economic Corridor (CPEC) programme, which Pakistan had undertaken, would complement regional connectivity initiatives of Carec members.
He stressed that the CPEC offered a massive opportunity for connectivity between Central Asia, Middle East and Africa and was bound to play a defining role in economic development of the two regions.
Dar said improving the transport corridor was not an end in itself but it was an investment in establishing sound infrastructure and complementary frameworks for shared prosperity of the present and future generations in the region.
The markets of Central Asian states and Russia are open and this is the area where Pakistan needs to increasingly focus on.
With an air of distrust between Islamabad and Washington over the latter’s inclination towards Delhi, China and Russia could not only support Pakistan’s economy, but they will also block India’s efforts to isolate Pakistan in the international arena. To achieve all that, Pakistan needs to forge deeper links with the Central Asia region and Carec can play a decisive role in that connection.
CPEC to strengthen CAREC by expanding north-south corridor:
The primary north-south transport corridor in Pakistan runs from Torkham on the northern border with Afghanistan and passes through primary production and population centres such as Peshawar, Islamabad, Faisalabad, Multan, and Khanewal, before reaching the port city of Karachi in the south. The corridor serves the economy of an area that accounts for 80 percent to 85 percent of the country’s GDP and in the regional context, forms an integral part of the Central Asia Regional Economic Cooperation (CAREC) corridors 5 and 6 after Pakistan's accession to the CAREC Programme in 2010.
The M-4 Motorway, linking Faisalabad with Khanewal, would be completed by July 2018, said National Highway Authority (NHA) member Mansoor Ahmed Sirohey on Friday.
He told journalists that the Asian Development Bank (ADB) is the leading financer in M-4 Motorway, as the bank disbursed $170 million (77 percent share of the project) in 2009 for construction of a 58km four-lane motorway M-4, connecting Faisalabad to Gojra (section I). This section was completed in December 2014.
Similarly, the ADB would provide 56.15 percent share of the funding of the section II of the M-4, which will construct the 62km four-lane access controlled motorway connecting Gojra and Shorkot. Meanwhile, government of the United Kingdom would provide grant of 29.02 percent and Pakistan would release share of 14.83 percent. The project is expected to complete by 2018, he added.
Sirohey said that contract for section-III of the motorway linking Shorkot to Khanewal has been signed and construction is expected to commence in December 2016. The ADB noted that M-4 Motorway in Punjab, linking Faisalabad with Khanewal, will cut travel time and support the government's broader goal of improved investment and trade flows along the country's vital north-south corridor route. Once fully completed, the M-4 Motorway will provide a faster, safer, more cost-effective north-south route to the currently overburdened national highway 5 and other existing narrow and congested routes.
#Pakistan #Railway track upgrade to include overpasses, underpasses & grade separation for high-speed trains #CPEC https://www.geo.tv/latest/124093-Railway-tracks-to-be-made-gate-free-and-signal-free-under-CPEC …
LAHORE: Railway tracks from Karachi to Peshawar will be made gate-free and signal-free under the next phase of the China-Pakistan Economic Corridor (CPEC), Geo News reported, citing sources.
A fence would be built around the tracks, similar to Motorway, and an underpass or overheard bridge would be built at every gate on the tracks, the sources said.
Work on the project would be initiated from January. The first phase of the project would focus on railway tracks between Rawalpindi and Peshawar.
The signaling system in Pakistan Railways will also be upgraded under the project.
According to the sources, the purpose behind making railway tracks gate-free and signal-free is to make train journeys safer and faster for the public. The fencing and bridges would also lead to a reduction in accidents.
Once the project is completed, the tracks would be able to accommodate high-speed trains. The railways authorities have completed the planning for the project, the sources added.
#GE Transportation in #Eerie #Pennsylvania to build 20 #locomotives for #Pakistan, creating new jobs for #Americans
GE Transportation workers in Erie will have more work to do, thanks to a new order for 20 locomotives from Pakistan Railways.
Top NewsClick Now and Read Later.
This latest order, announced this week, represents an expansion of a 2015 order for 55 Evolution series locomotives, 32 of which are already in service.
At about 2,000 horsepower, the locomotives being built for Pakistan are lighter and less powerful than the 4,600 horsepower locomotives the company builds for North American customers.
“These lighter-weight locomotives,” according to a statement from GE Transportation, “are designed to better maneuver difficult access roads.”
For Pakistan, the purchase is part of a strategic move to increase the percentage of freight moved by rail from 4 percent to 20 percent in the next 10 years.
For the Erie plant, which has been building about two locomotives per week, the order represents a small but important boost that could represent a certain amount of security at a plant where about 1,500 jobs were cut in the first half of 2016.
“Any work is good news,” said Scott Slawson, president of Local 506 of the United Electrical, Radio and Machine Workers at GE Transportation. “We are in a downturn that we are hoping to turn around.”
There have been some positive signs lately.
Slawson said a handful of people on the layoff list have been called back to work recently. While some of those employees will be taking the jobs of workers who have retired, Slawson said a number of others will provide labor in areas of specific need within the company.
Workers in Erie recently wrapped up work on the first two locomotives in an order of 1,000 locomotives for Indian Railways. The first 40 locomotives will be built in Erie, followed by 60 so-called kits that will be built in Erie and then shipped to India for final assembly. The remaining 900 locomotives will be built in India over the next 10 years.
Slawson said the employment situation at the Erie plant, which builds locomotives for the international market, might be substantially different if the Indian Railways order, the largest in the company’s history, was to be built exclusively in Erie.
“That would have been huge,” he said.
A three rail solution is possible between Indian & standard gauge. Turn-offs and switches are expensive with 3 rails, but not straight through sections. 3 rail does not work with standard & Russian gauge.
China would like a standard gauge link to Iran (and on to EU) through Pakistan. A standard gauge extension is going into Kazakhstan.
Upgrading ML-1 is an early harvest project of CPEC, for which the National Railway Administration of China and the Ministry of Railways Pakistan have jointly conducted a feasibility study.
CPEC’s official website quotes the project cost of $8.176 billion for rehabilitation and up-gradation of the Karachi-Lahore Peshawar (ML-1) Railway Track, with a length of 1,872kms. The first phase of $3.2 billion covers up-gradation of four segments.
The upgrade will bring the long-needed attention to railway transportation, which has deteriorated significantly over the past few decades. The Pakistan Railways carried over 70% of the national freight load in the 1970s, which now stands at a meagre 4%. Reportedly, the Pakistan Railways expects that this would grow to 20% after completion of this project with freight traffic increasing from five to 25 million tonnes per annum by 2025. The passenger traffic is also expected to increase by 45% (from 55 to 80 million passengers per annum).
National Transport Policy 2018 approved
The National Transport Policy available with The Nation has recommended that Pakistan Civil Aviation Authority will be restructured, separating its regulatory and service provision responsibilities.
Work on the National Transport Policy was initiated by the Ministry of Planning, Development & Reform in collaboration with Department for International Development (DFID) and Asian Development Bank (ADB) in February, 2017.
In road transport the NTP said that the priority for passenger transport by road will be to enhance the usage of non-motorized transport and public transport. An increased focus will be made to the provision of public transport services and integration to other modes. Private transport will be considered complimentary to non-motorized transport and public transport, and will provide reliable access to low density and remote areas.
For freight, the predominant movement by road transport will increasingly be shifted to rail and pipeline, by better integration of agriculture and industry to rail stations, dry ports, and pipelines.
Rural roads will remain vital for providing accessibility to local communities and public services, Urban roads will be designed to support efficient and effective urban transport and International road transport will be supported by accession to and implementation of relevant international road transport agreements and conventions. Leasing within the Right of Way shall not be pursued.
Regarding the maritime transport the NTP said that maritime sector shall be geared to become a major engine of growth through its support and facilitation of international trade. Karachi and Port Qasim ports will serve as the primary international gateway ports for all types of commodity shipments, with Gwadar Port balancing national trade opportunities, transshipment and regional transit.
A port-city council planning forum will be established to support port developments. Ports will be operated under a landlord port model.
Private sector terminal operators will lead in providing specialist terminal facilities and service delivery. Public sector will provide supportive port and navigation infrastructure and regulatory oversight.
Coastal port harbour facilities will be promoted, including freight and passenger shipping service concessions.
Maritime security will be enhanced for all maritime zones and implementation through maritime security agency. (xvii) An independent regulator will be established as national maritime authority.
Regarding the pipelines NTP said that oil, gas and bulk liquid will principally be transported via pipelines. Bulk dry commodities will be considered via slurry pipelines or conveyors upon establishment of a supporting business case. Pipeline connections will be established to ports, terminals, refineries, storage depots, dry ports, airports, industrial zones and to periphery of urban areas.
Regarding inland waterway transport the policy said that inland waterway transport will be promoted as a cheaper alternate, and environmentally friendly mode, and will become an element of intermodal transport services in conjunction and support of rail and road freight and passenger connections.
Passenger ferry services will target cross-river linkages, urban transit corridors, and coastal estuaries/ zones, as alternatives to rail and road access.
An inland waterway transport master plan will be developed, actively exploring other navigable rivers and canals, considering effective riverine water management planning.
The NTP further said that urban transport will be considered as a single integrated transport system and planned in accordance to the hierarchy of modes, including public transport, private transport, non-motorized transport, and freight transport.
Rail network to connect #Gwadar with #China, #Afghanistan under #CPEC. 1,328 km new line from #Jacobabad and #Quetta via Basima to Gwadar at a cost of $4.5 billion and new 560km rail track from Quetta to Kotla Jam on ML-2 via Zhob and DI Khan https://profit.pakistantoday.com.pk/2019/08/18/pakistans-railway-network-to-be-extended-to-gwadar-kashgar-kabul/ via @Profitpk
ISLAMABAD: The ambitious plan of connecting Pakistan’s railway network from China and Afghanistan to Gwadar deep sea port under China Pakistan Economic Corridor (CPEC) has been declared strategically important by both Pakistan and China.
The plan will help commercially viable transportation of goods from China and Central Asian States to the port city, besides boosting trade and tourism activities in the country.
The already agreed CPEC project for up-gradation of existing Main Line 1 (ML-1) railway track from Peshawar to Karachi will be materialised in the first phase, followed by new railway lines that would be laid across the country to boost trade activities under CPEC.
According to the plan, a new 1,059 kilometer railway line from Havelian in Pakistan’s province of Khyber Pakhtunkhwa (KP) to Kashghar in Chinese province of Xinjiang would be laid to connect both the countries through railways.
Another 1,328 kilometer long new railway line from Jacobabad and Quetta via Basima to Gwadar has also been planned to be constructed at a cost of $4.5 billion to connect the port city with the rest of the country and China. Similarly, Pakistan Railways also plans to lay a new 560km railway track from Quetta to Kotla Jam on ML-2 via Zhob and DI Khan.
A new railway line from Peshawar to Torkham in Afghanistan is also part of the plan, however, in a fresh development, a source in the ministry of planning and development said that the railway network would be extended deep in the country to Kabul, and then to Mazar-e-Sharif, so that the Central Asian states could be connected via railway line with Gwadar.
All these new railway projects have been put in the long-term plan of CPEC which is supposed to be completed by 2030. “In order to effectively eventuate ML-1 project, it has been decided to break the project into three packages,” an official in the railways ministry said.
The ministry of railways has already submitted the PC-1 of Package-1 to the Planning Commission.
“Keeping in view the importance of the project, Prime Minister Imran Khan has directed the authorities concerned to start work on the project as early as possible. Therefore, the PC-1 of first package of the project is expected to be considered by the Central Development Working Party (CDWP) later this month which would refer to the Executive Committee of National Economic Council (ECNEC) for final approval,” an official in planning ministry said.
He further said that once approved by the ECNEC, this project would be presented before the 9th annual meeting of Joint Coordination Committee (JCC) on CPEC between Pakistan and China to be held in October this year for finalising financing modalities.
The scope of work includes up gradation and doubling of ML-1 from Karachi to Peshawar and Taxila to Havelian (1,872km) including provision of modern signaling and telecommunication systems, conversion of level crossings into underpasses/flyovers and fencing of the track.
CPEC project leader in Ministry of Railways Basharat Waheed said that on completion of ML-1, Pakistan Railways will reap the advantages of increase in speed from 65-105 km/hour to 120-160 km/h, increase in line capacity from 34 to 171 trains each way per day, increase in freight volumes from 6 to 35 million tons per annum by 2025, increase in passenger trains (ex-Karachi) from 20 to 40 each way per day and increase in railway share of freight transport volume from less than 4% to 20%.
Journey time from Karachi to Lahore will be reduced from existing 18 hours to only 10 hours while that from Islamabad to Lahore will be reduced from four-and-a-half hours to two-and-a-half hours, he added.
#CPEC Re-Emerges In #Pakistan With Flurry Of Major #China Deals: 2 #hydropower projects costing $3.9 billion, and another to revamp Pakistan's colonial-era railways for $7.2 billion -- the most expensive #Chinese project yet in Pakistan. https://www.ndtv.com/world-news/belt-and-road-re-emerges-in-pakistan-with-flurry-of-china-deals-2263687 via @ndtv
China's Belt and Road program has found new life in Pakistan with $11 billion worth of projects signed in the last month, driven by a former lieutenant general who has reinvigorated the infrastructure plan that's been languishing since Prime Minister Imran Khan took office two years ago.
The nations signed deals on June 25 and July 6 for two hydro-power generation projects costing $3.9 billion in the Pakistan-occupied Kashmir region, and another to revamp the South Asian nation's colonial-era railways for $7.2 billion -- the most expensive Chinese project yet in Pakistan.
Khan's government appointed Asim Saleem Bajwa last year to run the China-Pakistan Economic Corridor Authority, which oversees more than $70 billion in projects from power plants to highways.
He also joined Khan's cabinet in late April, becoming one of more than a dozen former and current military officials in prominent government roles as the army expands its influence in the country.
The Chinese financing has helped rid Pakistan of an electricity deficit that left exporters unable to meet orders and major cities without electricity for much of the day. Still, the implementation of some investments appeared to stall since Khan came to power, with no new projects announced in 2018 and very few in 2019.
Since Chinese President Xi Jinping launched the initiative in 2013, the World Bank estimates about $575 billion worth of energy plants, railways, roads, ports and other projects have been built or are in the works across the globe. Its progress has slowed recently, dogged by accusations that China is luring poor countries into debt traps for its own political and strategic gain.
"The reality is that much of CPEC, like the Belt and Road more broadly, has been paralyzed," said Jonathan Hillman, a senior fellow at the Center for Strategic and International Studies in Washington, referring to the China-Pakistan Economic Corridor. Pakistan "is a flagship for China's Belt and Road, so the need to show progress is even more important."
In a tweet last month, Bajwa said some detractors had given the "false impression" that CPEC had been slowed. Not only has the pace of work on projects picked up recently, but a great deal of ground work has been done to launch phase two of the project that also includes special economic zones to lure Chinese manufacturers, agriculture, science, technology and tourism, he wrote.
"The prime minister pushed very hard on this," said Abdul Razak Dawood, Khan's adviser on commerce and investments said by phone. "We feel that we have to get more and more hydro in our energy mix."
A spokesman in Bajwa's office said he was not immediately available to comment.
Pakistan's army is already responsible for securing every single Beijing-funded project scattered across the country, from the mountains near the Chinese border to the desert in Gwadar where the Chinese operate a port. Its role has become even more important following terrorist attacks on three Chinese-related projects in the past year.
"There is no doubt that PM Khan's arrival slowed the pace of CPEC projects," said Mosharraf Zaidi, a senior fellow at Islamabad-based think tank, Tabadlab, and a former principal advisor to the foreign ministry. "The renewed energy and approval we are now seeing is almost entirely likely due to the chairperson having settled in, and being added to Prime Minister Khan's cabinet."
Railway Minister Shaikh Rasheed's Tweet:
انگریز نے ٹریک بنایا ہم نے 70 سال ٹریک کو ہاتھ نہیں لگایا،ٹریک بنے گا اس میں کوئی ریلوے کراسنگ نہیں ہو گی،7 گھنٹے میں کراچی سے لاہور کا سفر ہو گا،اسی سال یہ کام شروع ہوگا اور چین کی جس بھی پارٹی کو کنٹریکٹ ملے گا،ڈیڑھ لاکھ لوگوں کو کنسٹرکشن میں نوکری ملے گی۔
#Kavkaz2020: Why #Russia’s Latest #Military Drills Are a Golden Opportunity for #Pakistan! 18 nations, including #China, Pakistan & Central Asian nations are participating. #India has withdrawn from opportunity for military diplomacy. @Diplomat_APAC https://thediplomat.com/2020/09/kavkaz-2020-why-russias-latest-military-drills-are-a-golden-opportunity-for-pakistan/
Pakistan can also use the opportunity to reset relations closer to home. The scenic Wakan corridor separates Pakistan and Tajikistan and at their closest point, the two countries are a mere 10 miles apart. Despite historical and cultural ties between the two Asian nations (both were part of the Arab Umayyad and Persian Empires) and their joint participation in several infrastructure and energy projects (the Central Asia-South Asia Electricity Transmission and Trade Program), Tajikistan plays host to India’s only air force base outside of its borders. The Farkhor Air Base lies around 81 miles southeast of Dushanbe and perilously close to Pakistan’s northern border with Afghanistan. Indian fighter jets taking off from the base can reach Pakistani airspace in little more than a few minutes.
Naturally, this has put a significant strain on relations with Islamabad. Perhaps unsurprisingly, there are no major military ties or significant arms deals between Pakistan and Tajikistan, and if the former plays its cards right, it could use the drills as an opportunity to pull Tajikistan away from India’s military grip.
Military drills are often seen as a show of common strength between allies and a warning to others. However, for Pakistan it would be wise not to see these drills as a show of strength, but rather as an important opportunity to further its relationship with the former Soviet World. India’s recent decision to stay away from Kavkaz 2020 along with the sheer number of former Soviet states participating in them suggests a golden opportunity Pakistan cannot afford to ignore.
The spatial competition between containerised rail and sea transport in Eurasia
The competition in space between rail and sea transport is of great significance to the integration of Eurasia. This paper proposes a land and sea transport spatial balance model for container transport, which can extract a partition line on which transport costs by rail and sea are equal given a destination. Four scenarios are discussed to analyse the effects of different factors on the model. Then the model is empirically tested on current rail and sea transport networks to identify the transport competition pattern in Eurasia. The location of destinations, the freight costs, and time costs are the three main factors affecting the model. Among them, time costs are determined by the value of a container and its contents, the interest rate, and by time differences between land and sea transport. The case study shows that Eurasia forms a transport competition pattern with a land area to sea area ratio of about 1:2; this ratio, however, changes to 1:1 when time costs are considered. Further, the land and sea transport balance lines are consistent with the theories of geopolitics, which indicate that the same processes may exist in the spatial pattern of geo-economics and geopolitics in Eurasia. According to the balance lines, we get a spatial partition, dividing Eurasia into the land transport preferred area, the land–sea transport indifference area, and the sea transport preferred area. The paper brings a new perspective to the exploration of geopolitical economic spatial patterns of Eurasia and provides a practical geographic theory as an analytic basis for the implementation of the Belt and Road Initiative.
There are some limitations in the case study too. First, it is based on the precondition of using Beijing and Berlin as the destinations, and the current fluctuated values of speeds, goods and freight rates are all set unique. According to the simulation under different scenarios, preferential policies for transportation could be carried out by governments or transport companies in different places, which could further strengthen the practicality of our model. Specifically, some countries (such as India) oppose China’s BRI (Blah, 2018; Pattanaik, 2018). Therefore, we could add evaluations of the strategies for infrastructure construction, of such countries, in the future. Second, container transportation is a complex process. The extent to which the cross-border transportation between countries is frictionless will affect the land transport pattern. Moreover, these factors are difficult to quantify and have not been considered in this paper, such as unequal freight cost rates in different countries, different capabilities and widths of rails, time spent at ports, tariffs, insurance costs and so on, which may also influence actual costs. Third, in not considering the road network, this paper presents a basic possible pattern of land and sea transport balance based on the current railway and maritime networks, which may bias our results. At a strategic level, the results can offer positive suggestions to influence a better approach for transportation. It will, however, be necessary for individual decision-makers to make accurate calculations of the costs of different routes at a micro-level. Additionally, container shipping on the northern sea route is a potential transport corridor (Verny and Grigentin, 2009), it could be included in the future study. Moreover, because of the organisational system and mature development of transport companies, the related data of container transport are easy to obtain, which helps determining the costs and speeds more easily. In contrast, it is hardly to collect datasets of bulk transport. However, the effect of bulk transport may be significant because it is likely to form a large proportion of global maritime trade (J.P.Morgan Asset Management, 2019). This may render some ports more economically viable.
The spatial competition between containerised rail and sea transport in Eurasia
In the future, the BRI will be significant to the integration of economic trade in Eurasia, following the premise that land and sea transport should find a spatial balance. In fact, analysis of the competition and cooperation between land and sea transport can also be of theoretical significance for transport geography. This paper presents a LSTSB model based on the conceptualised Eurasia and simulates different land–sea transport scenarios. We then identify the transport balance lines by applying the model to Eurasia and present the partition of land and sea transport dominated areas in line with the theories of geopolitics.
The main insights are as follows:
Four scenarios based on different locations of destination, different freight costs, different values of a container’s goods and different speeds of transport are simulated using the theoretical model. They show that these basic factors influence the spatial balance lines of transportation. The results indicate that land transport is relatively competitive with sea transport but that this depends on different factors. Land transport may be undervalued at present due to long-term cooperation behaviour between governments or enterprises with maritime companies.
The case study shows that in terms of freight costs, maritime transport has an obvious advantage in Eurasia. The transport spatial balance line divides the Eurasian continent into a land and sea transport competitive pattern with an area ratio of 1:2. However, this ratio changes to 1:1 when we take time costs into consideration. Results show that the Economic Belt on road has economic feasibility and rationality.
Furthermore, the spatially competitive pattern of land–sea transport in Eurasia is highly consistent with geopolitical theories. This paper presents a partition of transport areas based on the calculation of balance lines, showing the land transport preferred area, the sea transport preferred area and the land–sea transport indifference area. The partition shows that the China–Russia–EU region, located in the land transport preferred area and the land–sea transport indifference area, is the key pivot area of integration influencing the current economic geographic imbalance in Eurasia. Further, it can serve as the analytic basis underpinning the necessity of increasing cooperation between China and the EU under the BRI, which is in the land–sea indifference area. Thus, the LSTSB model can bring a new perspective to the discussion of the spatial pattern of geopolitics and geo-economics in Eurasia.
Impact of Transport Cost and Travel Time on Trade under China-Pakistan Economic Corridor (CPEC)
Khalid Mehmood Alam
China is the second biggest economy in the world and almost 40% of its trade in 2016 is transported through the South China Sea. China needs a small, secure, and low-cost path to trade with Europe and the Middle East and China-Pakistan Economic Corridor (CPEC) is a feasible solution to this requirement. This research analyzes the effect of CPEC on trade in terms of transport cost and travel time. In addition, the study compares the existing routes and the new CPEC route. The research methodology consists of qualitative and descriptive statistical methods. The variables (transport cost and travel time) are calculated and compared for both the existing route and new CPEC route. The results show that transport cost for 40-foot container between Kashgar and destination ports in the Middle East is decreased by about $1450 dollars and for destination ports in Europe is decreased by $1350 dollars. Additionally, travel time is decreased by 21 to 24 days for destination ports in the Middle East and 21 days for destination ports in Europe. The distance from Kashgar to destination ports in the Middle East and Europe is decreased by 11,000 to 13,000 km.
Transportation is the shifting of goods by truck, rail, road, and sea and is reasoned as an important indicator for economic development . Transport has two main parts. The first part represents vehicles that are either van, truck, rails, airplanes, or ships and second part represents the transport infrastructure such as roads, highways, seaways, airways, and railway tracks on which transport runs smoothly. In the recent days, both parts of transportation are considered as an important factor of trade and help in reducing transportation cost and travel time. The selection of transport mode for delivery of goods within less time and minimum cost is important to maximize the profit. Every state tries its best to discover short trade routes that can reduce trade cost and transfer time. To enhance their trade, countries invest in transport infrastructures like roads and rails and adequate transport infrastructure can potentially reduce transport cost and travel time. Transport cost and travel time are considered as the most important among all factors .
Shipping industry plays an significant part in the development of trade and about 80% of world trade is transported by the international shipping industry [3, 4]. The import and export of goods on large scale are not possible without shipping . China is the second biggest economy and energy user in the world and safety of the oil supply chain stay the essential idea of China’s strategies . China is importing about 83% of oil supplies by sea, out of which 77% are functioning through the Strait of Malacca, a possible bottleneck for China . There are some factors like China’s regional disputes, pirate incidences, and geopolitics that make the Strait of Malacca as an attentive weakness for China and may stop economic development in case of any unanticipated events [8, 9]. About 60% of world pirate occurrences take place in the Strait of Malacca and presence of the Indian and US armadas in the seaway rises serious security concerns and in case of any unforeseen actions can affect trade and economic supplies of China [10–12]. To overcome these challenges, China wants to get access to deep water through Pakistan. The China-Pakistan Economic Corridor will link the city of Kashgar in Western China and the Gwadar Port in Pakistan by developing a transport infrastructure network comprising road and rail. Kashgar has great economic opportunities for the shortest land access to the local markets of Pakistan, Afghanistan, Iran, India, Uzbekistan, Kyrgyzstan, and Kazakhstan .
#Pakistan, #China agree to execute ML-1 #Railway Up-gradation Project under #CPEC on a priority basis. The agreement was reached at a virtual held meeting between the CPEC Authority and the National Development and Reforms Commission (NDRC) of China. #Transport- Business Recorder
ISLAMABAD: Pakistan and China agreed to execute the much-awaited mega ML-1 Pakistan Railway Up-gradation Project under the China-Pakistan Economic Corridor (CPEC) on a priority basis.
The agreement was reached at a virtual held meeting between the CPEC Authority and the National Development and Reforms Commission (NDRC) of China to follow up on the decisions taken during the recent visit of the prime minister to China.
Special Assistant to Prime Minister (SAPM) on CPEC Affairs Khalid Mansoor and Director-General NDRC co-chaired the meeting.
The ambassador of Pakistan in China also participated.
The meeting decided that Pakistan Railways would immediately contact the National Railway Administration (NEA) to work out further details of the project.
ML-1 project: design fault, inadequate consultancy cause delay
The meetings also discussed the schedule for holding of meetings of Joint Working Groups (JWG) for various sectors. It was decided that meetings of the Joint Working Groups for Industrial Cooperation, Information Technology, Science and Technology and Agriculture would be held in the near future.
The NDRC director-general said that the relevant Chinese institutions were already taking the necessary actions to implement the understandings reached during the visit.
The SAPM CPEC Affairs stated that the prime minister’s meeting with the Chinese leadership had been extremely fruitful and the relevant institutions of the two countries were fully geared to take the necessary steps to translate the understandings reached at the highest level into actual actions on the ground at the earliest.
The NDRC director general stated that the relevant Chinese institutions were already taking the necessary actions to implement the understandings reached during the visit. He said that the Chinese side attaches the utmost importance to the ML-1 project and several internal meetings between the National Railway Administration and other relevant institutions have been held to work out the modalities and prepare for execution of the first phase of the project.
The meeting also discussed projects in the power sector including the 300MW Power Project in Gwadar and the 1,320 MW Thar Coal Block-1 Power project. It was noted that all actions relating to these projects had been completed on Pakistan side. It was decided that the Chinese side would expedite the next steps relating to these projects.
The meeting expressed satisfaction at the pace of implementation of various projects in Gwadar such as the East Bay Expressway, New Gwadar International Airport, Pak-China Friendship Hospital, etc.
The SAPM on CPEC Affairs expressed his gratitude to the NDRC for their support and facilitation in forwarding the agenda of the CPEC.
Here's the latest Census data on modes of #freight #transport in #US. #Trucks ($10.4 trillion) claim humongous market share. #Rail only 250 billion. https://www.census.gov/library/stories/2021/02/what-is-in-that-truck-i-just-passed-on-the-highway.html
Pakistan, China aim to jump-start Belt and Road plans in key talks
“Pakistan has agreed to increase the cost of ML-1 from $6.8 billion to $9.85 billion, on the demand of Chinese negotiators, who termed the former cost figure as unrealistic,” an official privy to CPEC planning told Nikkei Asia on condition of anonymity since he was not authorized to talk to the media. The official further added that the ML-1 project will likely be approved by the JCC, which would be a major boost for the CPEC.
Pakistan and China aim to revive Belt and Road projects in the South Asian country at an annual huddle, scheduled to take place virtually on Thursday. In the run-up to the talks, cash-strapped Islamabad appears to have accepted a Chinese demand to increase the cost of a railway, as it seeks to secure more financing.
This will be the 11th meeting of the Joint Cooperation Committee, the key forum for making decisions on the China-Pakistan Economic Corridor (CPEC), a $50 billion Pakistan component of the Belt and Road. Zhao Shiren, the Chinese consul general in Lahore, told local media earlier this month that work on the CPEC is expected to speed up after the JCC meeting.
The center of attention now is Main Line 1, or ML-1, a project that will upgrade 1,733 kilometers of railway track between Karachi and Peshawar. This is the largest CPEC project in terms of cost, and it has been awaiting a final decision for the past five years.
"Pakistan has agreed to increase the cost of ML-1 from $6.8 billion to $9.85 billion, on the demand of Chinese negotiators, who termed the former cost figure as unrealistic," an official privy to CPEC planning told Nikkei Asia on condition of anonymity since he was not authorized to talk to the media. The official further added that the ML-1 project will likely be approved by the JCC, which would be a major boost for the CPEC.
In multiple background interviews, sources said other projects expected to get the nod include the Karachi Circular Railway at a cost of $1.33 billion and the Karakoram Highway realignment, valued at $1.8 billion.
Apart from these plans, another major issue up for discussion will be power projects. Beijing has built 12 power plants under the CPEC and Pakistan owes more than 250 billion rupees ($1.14 billion) in unpaid bills to the facilities. The JCC huddle is expected to deliberate on forming a revolving account for Chinese power producers so that they can get paid without getting entangled in Pakistan's web of debt.
Moreover, the JCC meeting might decide the fate of a 300-megawatt power plant in Gwadar -- a port intended to be a key Belt and Road hub. The Pakistani government would prefer to scrap the project as it scrambles to save money, whereas China seeks approval to start building it.
Aslam Bhootani, a member of the national assembly representing Gwadar, is not happy about the outlook. "No investment will come in Gwadar" unless the area's power problems are resolved, he said. "Scrapping the 300 MW power plant will not help in this situation."
Experts are on the fence about the prospects for rejuvenating the CPEC.
Michael Kugelman, director of the South Asia Institute at the Wilson Center, said the CPEC is in a holding pattern, with no new projects and existing projects moving very slowly out of caution over Pakistan's economic crisis, with its foreign reserves falling dangerously low.
"Given Pakistan's severe economic stress, as well as China's own recent slowdown," he said, "there will be little space for any type of new economic activity."
But the Pakistani government does have an incentive to stay in China's good books. Next week, soon after the JCC, Prime Minister Shehbaz Sharif is scheduled to visit China. This will be his first visit to Beijing as leader.
Pakistan, China aim to jump-start Belt and Road plans in key talks
According to media reports, Sharif will likely seek $10 billion in financial assistance from China, through balance of payment support and rolling over Chinese loans, which make up 30% of Pakistan's total external debt. Experts believe the Sharif government wants the JCC to be successful so that it can secure the required financial support from China during the prime minister's visit.
Despite his skepticism and the CPEC's sputtering progress, Kugelman also suggested Sharif might be the man to restore some momentum. "It was Prime Minister Sharif's brother [Nawaz Sharif] who launched the CPEC, and there's reason to believe Beijing is more comfortable working with the ruling PML-N party than with Imran Khan's PTI, which asked questions about transparency [of CPEC projects] that China didn't like," Kugelman told Nikkei.
While Sharif is planning to revive the CPEC, his political nemesis Khan is in full-throttle mode to topple his government. Even after suffering a setback last week with his disqualification from office over alleged mishandling of foreign gifts, Khan has announced a long march from Lahore to Islamabad starting Friday, demanding Sharif's resignation and fresh elections. Initially, it appeared Khan might be barred from politics for years but for now he has only been stripped of his seat in parliament.
Government officials fear the political uncertainty could jeopardize any gains made at the JCC meeting.
The instability is a problem, said James M. Dorsey, a senior fellow at the S. Rajaratnam School of International Studies in Singapore. But he said Beijing has already factored it in when making decisions about CPEC projects.
"Beijing knows that the ML-1 project is also in the interest of Pakistan and even if Khan again formed the government, he cannot reverse it," Dorsey said.
He added that the Belt and Road, in general, has been slowing down, and that efforts made to revive the CPEC are partly Beijing's attempt to fire up its broader global infrastructure drive.
China, Pakistan Agree to Launch $10 Billion Railroad Project
Two countries plan to upgrade line from Karachi to Peshawar
Pakistan officials have said they expect funding from China
By Faseeh Mangi
Chinese President Xi Jinping and Pakistani Prime Minister Shehbaz Sharif agreed in a meeting in Beijing to launch a high-speed rail project that could cost $9.85 billion, a move that comes as the world’s No. 2 economy moves to slow some of its lending due to growth concerns.
The two nations agreed to get started on the Main Line-1, according to a statement from Sharif’s office, which described it as “a project of strategic importance.”
That project involves upgrading a 1,163-mile, colonial-era track from Karachi to Peshawar to carry high-speed trains. Earlier this week, Pakistan formally approved the project, which has been in discussion for years, without saying where the funding would come from or providing technical details.
Officials in Pakistan have previously said they expected to get loans from China for the upgrade.
The US has in the past criticized China for using what it calls “debt diplomacy” to make developing nations more dependent on Beijing. Still, earlier this year China delayed a bailout for Pakistan as its debt soared, and it has been scaling back lending in Africa as its economy slows.
About 30% of Pakistan’s foreign debt is owed to China, including state-owned commercial banks, the International Monetary Fund said in a report in September.
In June, Moody’s Investors Service downgraded its outlook on Pakistan to negative from stable, citing financial concerns.
See: Xi Kicks Off Third Term With Flurry of Diplomatic Activity
In their talks, Xi and Sharif agreed to finalize details on an inner-city rail line in Karachi. The Chinese leader also said his nation would provide 500 million yuan ($68.7 million) to Pakistan to help it rebuild after flooding over the summer that displaced more than half a million people.
Also Wednesday, the two countries’ central banks signed a memorandum of cooperation on a yuan clearing in Pakistan, the People’s Bank of China said in a statement. It didn’t give more details.
Sharif is wrapping up a two-day visit to Beijing. China is hosting a flurry of foreign leaders this week, as Xi kicks off a norm-busting third term during which he’s vowed to increase his nation’s global influence.
Vietnam’s Communist Party chief Nguyen Phu Trong became the first foreign leader to meet Xi since the Chinese president removed rivals and installed loyalists at a leadership reshuffle last month.
Xi and his top officials are then expected to hold talks in the capital with German Chancellor Olaf Scholz and Tanzanian President Samia Suluhu Hassan. Later this month, he will likely travel to Indonesia and Thailand for major summits attended by global leaders including President Joe Biden and Russia’s Vladimir Putin.
China Is Investing Billions in Pakistan. Its Workers There Are Under Attack.
Beijing’s Belt and Road investment strategy meets resistance in the developing world it seeks to influence
China is the largest lender to the developing world, mainly through Chinese leader Xi Jinping’s Belt and Road infrastructure program. The country has worked to portray itself as a benevolent partner to the countries where it is spending money, in an attempt to draw a distinction with Western powers.
Still, as its global reach expands, China is increasingly grappling with the consequences of projecting power around the world, including corruption, local resentment, political instability and violence. For developing countries, China offers perhaps the best chance of quickly building major infrastructure.
Beijing accepts a degree of security risk in pursuing its Belt and Road program and is committed to working with partner governments, such as in Pakistan, to mitigate threats to Chinese personnel and assets, Chinese experts say.
“We couldn’t possibly wait until all terror attacks cease before starting new projects,” said Qian Feng, a senior fellow at Tsinghua University’s National Strategy Institute. “We have to keep working, studying the issues, and undertake preventative measures at the same time.”
Chinese businesses and workers in several countries where it is making investments have become favored targets. Chinese nationals are seen as wealthier than most locals and, in some cases, are perceived to be reaping too much of the economic benefits and job opportunities created by Beijing’s investments.
Gunmen in Nigeria abducted four Chinese workers in June during an attack at a mine in the country’s northwest. In October, unidentified “thugs” attacked a Chinese-funded business in Nigeria and killed a Chinese employee there, according to the Chinese consulate in Lagos. The consulate urged Chinese companies to hire private security and fortify their work areas.
In the Democratic Republic of Congo, where Chinese investors dominate the mining industry, Chinese business groups and workers have sounded alarms about armed robberies and kidnappings in recent months. Beijing has urged local authorities to step up security for Chinese assets and personnel.
There were about 440,000 Chinese people working abroad for Chinese contractors in Asia and roughly 93,500 in Africa at the end of last year, according to the China International Contractors Association, a Beijing-based industry group.
The Oxus Society, a Washington-based think tank, counted about 160 incidents of civil unrest in Central Asia between 2018 and mid-2021 where China was the key issue.
Beijing recognizes the rising threat to its workers in developing countries but doesn’t want to send in its army as it professes noninterference abroad, said Alessandro Arduino, author of “China’s Private Army: Protecting the New Silk Road.” Instead, China is deploying technology such as facial recognition and hiring more private Chinese security contractors, he said.
China chose Pakistan—one of its closest allies, with deep military ties and a common rival in India—as a showcase of its investment in developing nations. Beijing has spent about $25 billion here on roads, power plants and a port.
Pakistan taps Chinese credit for railway upgrade despite debt crisis
Islamabad says $10bn revamp of colonial-era line is essential even as it faces risk of default and forex reserves plunge
Ahsan Iqbal, Pakistan’s planning minister, said the ML1 upgrade was vital to keep trains running and an example of the transformative work that Chinese credit had made possible.
“If we do not undertake this project, in a couple of years Pakistan will lose its railway logistics,” Iqbal told the Financial Times.
“The whole railway system will break down, this main line will break down. It will be very risky to run commercial operations on this track. It is no longer a choice. It is an imperative.”
Iqbal, who oversees Pakistan’s involvement in the Belt and Road Initiative, China’s international infrastructure scheme, said it would take six to nine years to complete the ML1 upgrade. The work will include replacing track, modernising signalling, converting level crossings into underpasses or flyovers and building fences to stop cattle crossing the line.
The planning minister said the project would proceed in phases “to make it more manageable”, with an initial cost of $3bn. The loan from China would be repayable over 20 to 25 years and would be “concessional”, he said, without providing further details.
Chinese lending to Pakistan goes back years, part of an effort to forge economic and military ties that will help to counter their mutual rival India. The ML1 upgrade is part of the China-Pakistan Economic Corridor, a BRI centrepiece with an estimated total cost of $60bn.
The CPEC also includes Chinese development of a deep-sea port at Gwadar in south-western Pakistan, among other projects. Beijing is separately supplying Pakistan’s military with eight submarines and advanced J-10 C fighter jets.
A western diplomat in Islamabad said that for such projects to have continued even as Beijing saw growing financial distress in BRI recipient countries pointed to the importance it put on ties with Pakistan.
“Even if the rest [of BRI] lags behind, China wants to stay the course with Pakistan,” the diplomat said, adding that the relationship had “important military aspects developed over the long term”.
The projects — and Chinese financing — have also stoked domestic tensions. Police in Gwadar last month imposed emergency measures and dismantled a protest camp that had obstructed operations at the port with demands, among others, for Chinese nationals to leave.
Projects such as ML1 have also fuelled analyst concerns over whether excessive Chinese lending is exacerbating strains on Pakistan’s precarious finances. Chinese state lenders are together among the largest creditors to Islamabad, accounting for about $30bn of its outstanding debt.
Sakib Sherani of advisory firm Macro Economic Insights said it was unfair to single out China’s role in Pakistan’s debt woes, with the largest repayments in the current financial year actually due to multilateral lenders.
But Chinese loans tend to carry higher interest rates than multilateral or other bilateral creditors, according to the AidData research lab at William & Mary college in the US. Chinese annual interest is typically 3-4 per cent compared with 1-2 per cent from OECD lenders, AidData said.
Even as it taps Beijing for the ML1 project, Pakistan is looking elsewhere for funds to help stabilise its shrinking reserves. The finance ministry is in talks with the IMF to secure the next tranche of a $7bn assistance programme, and has said it will approach “friendly” countries such as Saudi Arabia for more loans.
Sharif’s government is betting it can steady the economy in time for parliamentary elections that must be held before the end of this year.
Iqbal said he was confident the country would pull through. “Pakistan is facing economic [and] fiscal difficulties, but it is not in the range that it is a default economy yet. We are managing very prudently.”
ML-1, KCR (Karachi Circular Railway) upgrade projects to start in March
He (Ambassador Non Rong) recalled that under the CPEC, 192,000 jobs were created, 6000MW of electricity was generated, 510 km of highway was constructed and 886 km of transmission was set up, which laid a solid foundation for Pakistan’s socio-economic development. “In fact, Pakistan’s trade surplus of agricultural products is expected to exceed a record high of $1 billion in 2022,” the ambassador said.
The Chinese sources said the ML-1 is the largest infrastructure project of CPEC worth $6.86 billion. The project involves the up-gradation and dualization of ML-1 to increase the operating speed from the current 60 km/h and 105 km/h to a proposed 160 km/h. The project also involves the establishment of a dry port near Havelian. ML-1, the Karachi to Peshawar line, is one of four main railway lines in Pakistan, operated and maintained by Pakistan Railways. The line begins from Karachi City Station or Kiamari station and ends at Peshawar Cantonment Station. The total length of this railway line is 1,687 kilometers. There are 184 railway stations from Kiamari to Peshawar Cantonment on this line. The line serves as the main passenger and freight line of the country. 75 percent of the country’s cargo and passenger traffic uses the ML-1. The existing timeline for the completion of ML-1 extends to December 2024. Under the umbrella of this project, level crossing will be converted into flyovers or underpasses so that the speed can be increased by getting rid of the obstacles.
The project could not be started during the PTI government due to China’s concerns over debt repayment plan, the sources pointed out. ML-I railway line project is very important to achieve connectivity between Gwadar (Pakistan) and Kashgar (China) through a train track that will provide the easiest and safest way to transport oil between China and the Middle East, saving China travel costs. The railway line upgrade will provide faster travel facilities to the people of Pakistan and commercial benefits like bringing raw materials to the Special Economic Zone (SEZ) and faster delivery of finished goods to remote areas of the country as well Gwadar port. Another great benefit is that coal will be delivered for fuel to the power plants through the railway track, which will also generate good revenue for the railways. Due to unnecessary delays, the cost of this historic project has increased. The Imran’s PTI government failed to convince the IMF and the Chinese government to start the project. Another reason for the increase is the recent floods in Pakistan, which has destroyed the railway lines of most parts of the country. As soon as the new government was formed in April, 2022, Pakistan’s Minister for Planning Ahsan Iqbal restarted the discussion with the Chinese authorities on revival of the project.
The revived KCR operation is intended to become an inter-regional public transit system in Karachi, with an aim to connect the city centre with several industrial and commercial districts within the city and the outlying localities. In May 2017, the then government approved Rs27.9 billion ($120 million) restoration package for the KCR. However, delays and disputes with the Sindh provincial government ultimately led to cancellation of the funding. KCR would be constructed with the cost of Rs294 billion and used by 500,000 passengers/day, which would increase to 1 million in later years. KCR will have 250 modern driverless electric bullet trains, which would run 17-hours a day throughout a week. The KCR project would be run by the Sindh government through Karachi Urban Transport Corporation (KUTC) and likely to be completed by 2025.
Bilal I Gilani
Who wants to partner with whom
Gallup International survey in 64 countries on who wants to partner with whom
•Among different religious groups, US is ahead of China in preference for economic partnership. However, the gap is narrowest among Muslim respondents.
Bilal I Gilani
A representative sample of men and women in Pakistan was asked the following question: “Which of the following would you prefer your country to partner with economically – ” 56% responded China, 13% preferred US, 8% said Russia while another 8% said Others
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•Interesting to note that just like economic preference, low-income economies prefer China for security partnership.
Gallup International survey in 64 countries on who wants to partner with whom
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Pakistan tops the world in terms of wanting to have security partnership with China
Gallup International survey in 64 countries on who wants to partner with whom
Bilal I Gilani
Out of the 64 countries that were surveyed, South Korea tops security preference for US, Pakistan tops preference for China, while Serbia tops the preference for Russia and EU for security partnership
Gallup International survey in 64 countries on who wants to partner with whom
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•Popularity of economic partnership with China was found to be highest in Sub Saharan Africa followed by MENA region. The least support was found in EU (lower than even US)
Gallup International survey in 64 countries on who wants to partner with whom
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•Younger populations are more amiable towards China when it comes to striking Economic partnership. 23% of respondents under the age of 34 preferred China. Only 11 % in 55+ age bracket across the globe.
Bilal I Gilani
Pakistan, UAE and Nigeria are at the bottom for economic partnership with EU.
Gallup International survey in 64 countries on who wants economic partnership with whom
Bilal I Gilani
Yemen, Pakistan and Russia top in willingness to pursue economic partnership with China.
Gallup international survey on who wants to partner with whom in the global rivals US , China , Russia
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