Monday, November 14, 2016

Pakistan Army: Chief Backer & Guarantor of CPEC

In July 2016, British newspaper Financial Times report headlined "China urges Pakistan to give army lead role in Silk Road project (CPEC):  Squabbles in Islamabad highlight obstacles to Beijing’s plans for transport and energy corridor" said as follows:

"Frustrated with the slow progress on a sprawling, $46bn infrastructure project stretching from China to south Asia, Beijing is seeking to give Pakistan’s army a lead role.... progress has stalled as the two sides work out how to turn the proposals into concrete projects, said Victor Gao, a former Chinese foreign ministry official, with some blaming Pakistan’s competing ministries"..... “Pakistani politicians have squabbled over the route for the CPEC and this may have made people nervous in Beijing,” said a Pakistan government official. “Pakistan is a noisy place politically while the Chinese are not used to harsh disagreements, especially over such a vital project.”

Chinese Container Ship "Cosco Wellington" at Gwadar Port

Gwadar Port Operational:

In the first week of November 2016, hundreds of containers arrived at Pakistan's Gwadar Port from Western China via CPEC's western land route. These containers were loaded onto "Cosco Wellington", a large Chinese vessel, and the ship departed Gwadar Port on November 13, 2016, for various destinations in Africa, Middle East and Europe.

Prime Minister Nawaz Sharif and General Raheel Sharif at Gwadar Port on Nov 13, 2016

So what is happening behind the scenes? Is the Pakistani military playing a big role in making CPEC a reality? What is the extent of Pakistan Army's participation in executing CPEC-related projects? Let's examine answers to these questions in three parts: Managing squabbling civilians, providing security and projects execution.

Squabbling Civilians:

Pakistan Army Chief General Raheel Sharif is playing a very active behind-the-scenes role in managing the infighting among politicians, ministers and the civil servants. It has been reported that Gen Sharif has been talking to all of the stakeholders regularly to ensure progress on China-Pakistan Economic Corridor projects.

Providing Security:

Various militant groups, including Indian government proxies, are engaged in sabotaging CPEC. While some attacks have been successful, it is believed that the Pakistani military has been able to prevent many more. Thousands of soldiers and hundreds of intelligence officers are believed to be working to manage the security situation all along the western route and in Gwadar.  This is what made the recent pilot run with the trucks convoy reaching Gwadar and operationalizing the port recently.

Projects Execution:

The Pakistan military has thousands of civil, mechanical and electrical engineers with decades of experience in building large infrastructure projects and analysts say the army is well placed to supervise the corridor, according to the Financial Times.

In fact, Pakistan Army's Frontier Works Organization (FWO) is building significant parts of the China-Pakistan Economic Corridor (CPEC). A July 2015 announcement is an illustration of what Frontier Works Organization is doing to advance CPEC:

“The Frontier Works Organization (FWO) has built roads with 502 kilometers length on the western alignment of China Pakistan Economic Corridor (CPEC) to link Gwadar with other parts of the country. The FWO took up the challenge to extend the benefits of Gwadar port to rest of the country by building roads in rugged mountainous terrain and highly inaccessible areas. The gigantic task was undertaken on the directives of Chief of Army Staff General Raheel Sharif."

Army's Strong Commitment:

Army Chief General Raheel Sharif has made his institution's commitment loud and clear by frequent statements on the subject. He has said “We will do everything to make it a success". He is also record as warning that “terrorism is a global issue and warrants global response. The funding of all terrorist organizations has to be checked by all. We are against use of proxies and won’t allow it on our soil".


Pakistan Army is playing a crucial role in ensuring progress and completion of China Pakistan Economic Corridor (CPEC) related projects. The army leadership is using all its power and influence with all stakeholders, including politicians and civil servants, as part of this campaign to bring about development of infrastructure and energy to make Pakistan economically successful.

Related Links:

Haq's Musings

CPEC to Create Over 2 Million Jobs

Modi's Covert War in Pakistan

ADB Raises Pakistan GDP Growth Forecast

Gwadar as Hong Kong West

China-Pakistan Industrial Corridor

Indian Spy Kulbhushan Yadav's Confession

Ex Indian Spy Documents RAW Successes Against Pakistan

Saleem Safi of GeoTV on Gwadar

Pakistan FDI Soaring with Chinese Money for CPEC


Javed said...

This is the sixth time Gwadar Port has become operational

Riaz Haq said...

Javed: "This is the sixth time Gwadar Port has become operational"

Gwadar was originally built during Musharraf years, inaugurated in 2007 and occasionally used for ships carrying imported fertilizer to Pakistan.

However, this is the first time Gawadar received cargo containers from China via CPEC western route that were loaded on to a Chinese container ship for export.

Riaz Haq said...

#Pakistan, #China Jointly Open New International Trade Route. #CPEC #Gwadar

Pakistan and China this week activated a new international trade route through the southwestern Pakistani port of Gwadar to showcase a multi-billion-dollar economic cooperation agreement between the two close allies.

Beijing's $46 billion investment under the China-Pakistan Economic Corridor will lead to construction of road, rail and communication networks and power projects in Pakistan along the route linking China's western Xinjiang region to Gwadar.

Chinese officials say CPEC is "the major and pilot project of the Belt and Road” initiative proposed by President Xi Jinping.

It will ultimately turn the deep water Gwadar port, developed with Chinese financial and technical assistance, into a gateway for imports and exports from Xinjiang to international markets.

The port sits at the convergence of three of the world’s most commercially important regions, the oil-rich Middle East, Central Asia and South Asia. It also lies at the mouth of the Persian Gulf, just outside the Strait of Hormuz.

Pakistani and Chinese officials gathered Sunday at the port to welcome the first convoy of trucks from China. Containers were loaded on two Chinese ships before they sailed to overseas destinations from Gwadar.

The trade convoy passed 3,000 kilometers along the Karakoram Highway through western Pakistan after entering at the Khunjerab Pass, the world's highest paved border crossing.

“It proves the connectivity of the local roads and realization of the concept of one corridor with multiple passages,” noted Chinese Ambassador to Pakistan Sun Weeding in Gwadar.

“This trade convoy is the best reflection of the spirits of mutual consultation, joint construction, mutual benefits and win-win cooperation. I believe these spirits will serve as the solid basis for the future construction of CPEC,” said the Chinese diplomat.

Pakistani leaders hope the economic corridor will bring development and prosperity to billions of people in the region.

"Pakistan is located at the intersection of three engines of growth in Asia - South Asia, China and Central Asia. CPEC will help in integrating these regions into an economic zone offering great opportunities for people of the region as well as investors from all over the world,” Prime Minister Nawaz Sharif told Sunday’s ceremony at Gwadar.

For China, the proposed CPEC route will offer the shortest possible access to the Arabian Sea and the Indian Ocean. Chinese ships currently travel through the Strait of Malacca and it takes about half a month to transport goods to or from China.

The Pakistani government is under fire at home for allegedly maintaining secrecy around CPEC-related projects and diverting much of the Chinese investment to the populous province of Punjab, a traditional stronghold of Sharif’s ruling party.

The prime minister and his spokespeople have repeatedly denied the allegations.

"CPEC is for entire Pakistan and no province and region will be left out of it. The whole nation is united and determined to make CPEC a model of success and a flagship project of Pakistan and China friendship to take our friendship to greater heights," said Sharif, while speaking in Gwadar.

Despite security and political concerns, Chinese and Pakistani officials say that CPEC-related projects have entered into full implementation and are making “remarkable progress.”

They say 16 out of 24 “early harvest projects” are under construction and expected to be completed by 2018, creating tens of thousands of new jobs for local people.

Pakistani critics, however, point to a lack of structural reforms, corruption and mismanagement in government institutions for their skepticism about CPEC.

They insist that existing infrastructure needs a major overhaul to be able to absorb pressure that CPEC-related activities will generate in the coming years.

Riaz Haq said...

#FATA Development Top Priority: #Pakistan COAS Opens #Bannu-#Miranshah-GhulamKhan Rd. #Afghanistan- via @PKKHTweet

General Raheel Sharif, Chief of Army Staff on Sunday inaugurated an important section of upcoming Central Trade Corridor (CTC) alongwith the largest bridge on this road in South Waziristan Agency. CTC is a strategic road link to facilitate trade not only between Pakistan and Afghanistan but it will also directly and indirectly help revive local economy of FATA and KP. An international standard, 705 KM long road network through southern KP & FATA, CTC is being built by Army Engineers and funded by friendly countries.

The 76 KM long Shakai – Makeen road funded through USAID is an important lateral along the CTC which connects the two main axes of Trade Corridor i.e., Road Bannu – Miranshah – Ghulam Khan and Road Wana – Aangor Ada. Apart from other economic, security and strategic advantages, the newly constructed roads have reduced travelling times considerably.

The COAS said, development of FATA is a priority task being undertaken by the Army as a well considered strategy. Pakistan Army has undertaken 178 x projects so far in social sector take communication infrastructure and power sector in FATA and Malakand areas. These projects are aimed to improve the quality of life in tribal areas and address the problem of militancy on long term basis.

While addressing the tribal elders, COAS appreciated their support in combating terrorism and acknowledged their sacrifices in war against terrorism. He reiterated Army’s resolve to bring peace and stability to the affected areas.

Referring to operation Zarb-e-azb the Gen. Raheel Sharif said that the operation is progressing successfully as per plan. He said while focusing on early completion, the army will continue with rehabilitation and reconstruction activities. A comprehensive plan in this regard has been chalked out in consultation with the government.

Riaz Haq said...

#India & #Israel deepen intelligence & defense cooperation against "terrorism" #RAW #Mossad via @timesofindia

The two countries worked very closely together on defense, counter-terrorism, intelligence and security. But in recent years, Israel has become one of India's closest partners in agriculture, water management and conservation.

India is Israel's largest buyer of military hardware and the latter has been supplying various weapons systems, missiles and unmanned aerial vehicles over the last few years but the transactions have largely remained behind the curtains.

Riaz Haq said...

#Pakistan targets 6% GDP growth by 2018 …

Haroon Akhtar, special assistant to the Prime Minister on revenue said on Wednesday the country, beset by low tax-to-GDP ratio, is expected to achieve growth rate of six percent before the next elections, due to introduction of pro-business policies.

“The business-friendly policies of the government have resulted in rapid economic development and the country will achieve growth rate of six percent by the elections (due 2018),” Akhtar told business leaders at the newly-constructed building of the Federation of Pakistan Chambers of Commerce and Industry in Islamabad.

“Low tax-to-GDP ratio is hampering development for which we are trying best, while enhanced transparency has been ensured in the FBR (Federal Board of Revenue).”

During the recent years, the country has seen its growth accelerate on support of a three-year bailout program by the International Monetary Fund. Still the government is struggling to increase narrow tax base, shrinking exports and key foreign direct investments.

The FBR collected Rs3,112 billion in taxes for the fiscal year ending June 30, 2016, registering a 20 percent increase over the previous fiscal.

Yet, the country’s tax-to-GDP ratio has stagnated at 10 percent over the last few years. A study said only tax evasion shears five percent from the tax-to-GDP ratio.

The government eyed growth rates at 5.7 percent for the current fiscal year of 2016/17 and seven percent for 2017/18.

Pakistan’s economy achieved growth rate of 4.7 percent in 2015/16, the highest in the past eight years.

The World Bank, however, projected the country’s growth rate at 5.4 percent by 2018. Akhtar said a lot of incidents of tax evasion are being reported, “but, we opt for legal actions in a very few cases.”

“Those who pay tax after detection face no action at all,” he added. “US is a super power because of a good tax system, while Europe is considered developed due to good taxation, therefore Pakistani business community should also discharge obligation so that Pakistan can develop at a fast pace.”

He said a number of sectors, including fertiliser, have been given tax breaks, which has resulted in good growth. “Lenders like Asian Development Bank is ready to provide loan on less than two percent, which indicates its confidence on Pakistan’s policies,” he said.

The PM’s assistant said the government has not transferred burden of improved oil prices to the masses. He said those who say that foreign debt would swell to $110 billion have overlooked certain facts. “GDP, investment and exports will also take a boost,” he added. “Debt-to-GDP ratio in Pakistan is at a comfortable level of 20 percent, while average interest payable on debt is three percent, which is not worrying.”

Riaz Haq said...

#CPEC: Will #India Start War With #Pakistan And #China Over It? … via @ValueWalk

By Polina Tikhonova

With China and Pakistan actively working on the CPEC, the uptick of irresponsible propaganda pieces coming from politicians and analysts – originating mostly from India – shows no sign of going away.

Such an opinion was expressed by Panos Mourdoukoutas, a contributor for Forbes. Mourdoukoutas argues that China has to either appease India or “forget” about the CPEC project.

A number of Indian government officials have expressed their concerns over the CPEC since the project was announced over three years ago. And while India, as alleged by Pakistan, has made numerous attempts to disrupt the project, the chances that India might actually start a war with China and Pakistan over the project remain equal to zero.

In fact, former Indian Ambassador Melkulangara Bhadrakumar said India would “lose heavily” if it remained opposed and isolated from the CPEC.

However, numerous Indian government officials believe the CPEC is designed to undermine India’s position in the region and see the project as a threat to India’s interests.

While that creates tensions between China and Pakistan on one side, and India on the other, authors of anti-CPEC propaganda pieces seem unable to provide at least one legitimate reason as to why India would go to war with China and Pakistan over the project.

China would protect the CPEC at all costs as the project is worth a whopping $46 billion and is a game-changer for both China and Pakistan. Disrupting the project would mean a direct declaration of war to China and Pakistan. And India knows it.

This past summer, the China Institutes of Contemporary International Relations suggested that Beijing will have “to get involved” if New Delhi attempts to disrupt the project.


In his piece arguing that China is lagging behind India in terms of investments, Mourdoukoutas provides data that suggests India’s economic growth is set to outpace China.

Although India currently enjoys the rise of its economy, the country is becoming less attractive for investors in the long run. The reason? India is a “highly crowded trade,” as said by Herald van der Linde, head of Asia Pacific equity strategy at HSBC, in the bank’s Asia Equity Insights Quarterly.

“High fund holdings, premium valuations and slow pace of reforms make us reluctant to enter the market,” van der Linde wrote, adding that India’s earnings growth expectations are also slowing down.

Will India go to war with China and Pakistan over CPEC?

In his article, Mourdoukoutas also suggests that “if pro-Indian forces in Pakistan sabotage China’s CPEC route,” China should expect an open confrontation against India.

Mourdoukoutas also argues that it’s the reason why Beijing “should either appease New Delhi or forget about CPEC altogether.”

An open military confrontation between the world’s two most populous countries is very unlikely, especially considering the fact that India has already made several large-scale attempts to sabotage the CPEC.

Earlier this year, Pakistan alleged it had arrested a spy from India’s RAW, Kulbhushan Yadav. Islamabad believes that Yadav is responsible for hindering implementation of CPEC projects in Pakistan’s Balochistan province.

Riaz Haq said...

#Gwadar port a watershed in #China and #Pakistan ties- #CPEC

China and Pakistan have sailed into the Arabian Sea and are waiting to shake hands with the UAE and the rest of the world across the Straits of Hormuz. Making marine shipping and political history, two ships sailed from the new Pakistani port of Gwadar into the Arabian Sea.

China and Pakistan are tapping the most important energy-rich markets in the world - the UAE, Saudi Arabia and Africa - with two ships - MV Cosco Willington and MV Al Hussein - sailing into the Arabian Sea from the new Pakistani port of Gwadar, destined for the Middle East and African ports. The occasion is a watershed moment.

It also marked the opening of the first segment of the $51 billion China-Pakistan Economic Corridor (CPEC). Gwadar and the CPEC are the lynchpins of making this region a big economic zone. It will cover the whole of China, Central Asian Republics, Afghanistan and Pakistan in the east, UAE and Saudi Arabia in the South, Iran in the west and Turkey-EU in the northwest.

The CPEC reduces the sea route from Shanghai to the UAE to a few kilometers. Eyeing the massive business opportunities, Saudi Arabia, Iran and Turkey have offered to join the CPEC zone. Turkish President Recep Tayyip Erdogan was in Islamabad to take the deal forward.

The western Chinese city of Kashgar won the distinction of being the first to use the pilot project in the new land-sea route.

Geo-strategic location
Pakistan Prime Minister Nawaz Sharif said the CPEC, of which Gwadar is the southern-most terminal, has become a reality with the start of shipment of trade cargo from this new port.

"The CPEC project enjoys a unique geo-strategic location, standing at the crossroads of three major engines of growth, including South Asia, China and Central Asia. It will change the fate of three billion people in the region. It will also serve as the hub of a major trade zone," he said.

Pakistan has already allocated land for the Gwadar free trade zone, with special tax and tariff concessions. The exclusive industrial park, processing zone and mineral economic zone are being implemented on a fast-track basis.

Sharif described the Gwadar-CPEC project and arrival of the Chinese cargo-container convoy as "break of a new dawn" and "a watershed event."

Sharif said: "I applaud the role of Chinese President Xi's [Jinping] vision of regional prosperity which coincides with Pakistan's vision of Deevelopment-2020. President Xi's vision of shared prosperity through greater connectivity is the need of the hour in a conflict-ridden and polarised world."

President Jinping said: "Our concept of 'one-belt, one-road' aims at integrating trade and commercial activities of regional countries through enhanced connectivity. It will transform Pakistan into a major hub of trade." The message was read out at the inauguration of Gwadar port by Ambassador Sun Weidong.

The ambassador said it is for the first time that a trade cargo has successfully passed through from the north of China to the south of Pakistan and onto the Arabian Sea.

"This is also for the first time that China and Pakistan have co-organised a trade convoy through Pakistan to Gwadar port. The local people will get jobs. It proves that connectivity of local roads will be beneficial to all."

The project officials said that 125 Chinese cargo trucks had entered Pakistan through the border post of Sust. They also said an air link between the Chinese city of Kashgar and Pakistani city of Skardu will be established. Yet another air link will connect the Chinese city of Urumqi with the Pakistani city of Gilgit to facilitate trade of Chinese goods through Gwadar.

Riaz Haq said...

#Pakistan saw 45% fewer #terror attacks & 38% fewer deaths this year, says ‘Global Terrorism Index (GTI) 2016’.

Pakistan recor-ded a substantial decrease in terrorist activities last year, with 45 per cent fewer attacks and 38pc fewer deaths reported in the year than in the previous year, according to the report of the ‘Global Terrorism Index (GTI) 2016’.

This is the second consecutive year in which Pakistan has seen reduction in terrorist activities. Terrorism in the country is now at its lowest level since 2006, says the report released by the US-based Institute for Economics and Peace, an independent think-tank.

The GTI is based on data from the Global Terrorism Database which is collected and collated by the National Consortium for the Study of Terrorism and Responses to Terrorism, a department of the Homeland Security Centre of Excellence led by the University of Maryland.

Pakistan had the third largest decline in deaths. There were 677 fewer deaths in Pakistan. As a result, Pakistan had the lowest number of deaths from terrorism since 2008, said the report released on Thursday.

The reduction in deaths from terrorism is in part explained by Zarb-i-Azb military operation being carried out by Pakistan Army. The operation focused on removing militant safe havens in North Waziristan.

Pakistan continued to see decline in its levels of terrorism due to infighting within the largest active group, the Tehreek-i-Taliban Pakistan (TTP), as well as to the operations of the army in the Federally Administered Tribal Areas.

Although the TTP reduced the number of attacks in Pakistan, it was still responsible for the most attacks, according to the report. In 2015 the group was responsible for 36pc of the deaths, totalling 240 people. This was down from 59pc of the deaths, totalling 544, in 2014, representing a sharp year-on-year reduction.

Although the number of attacks declined, terrorist activities was spreading across the country. It moved from the border region with Afghanistan to many other parts of the country, especially the Punjab province in the east which is the most populated area of Pakistan. A total of 429 cities experienced terrorist attacks in 2015, up from 17 in 2000. This may create a much more difficult situation for the Pakistani government in the coming years.

Riaz Haq said...

#Pakistan to establish 29 Special Economic Zones along #CPEC network in all 4 provinces via @techjuicepk

Federal government is planning on establishing about 29 Special Economic Zones (SEZs) in all of the four provinces under China-Pakistan Economic Corridor.

SEZs will be capable of enhancing country’s economic capacity, expanding the exports and providing much-needed momentum to the country’s economy. They’ll prove to be a turning point in the industrial development and infrastructure also. Pakistan has always been lagging behind the other South Asian countries in utilizing the SEZs benefits.

What are SEZs?

The idea of SEZ first started in New York in 1937. As per SEZ Act of Pakistan,

“Special Economic Zone (SEZ) is a blanket term for various types of specialized zones with specific types of enterprises operating in a well-defined geographic area where certain economic activities are promoted by a set of policy measures that are not generally applicable to the rest of the country. Successful SEZs offer immediate access to high-quality infrastructure, uninterruptible power supply, clearly titled land, public facilities, and support services.

The fiscal benefits under the SEZ law include a one-time exemption from custom duties and taxes for all capital goods imported into Pakistan for the development, operations and maintenance of a SEZ (both for the developer as well as for the zone enterprise) and exemption from all taxes on income for a period of ten years.”

As per 18th Amendment, provinces can now independently formulate their investment and trade policies. SEZs will be a source of their collaboration in designing lucid policies.

The challenge to be faced by SEZs will be in selection of the area. Government should select remote locations so that other locations are not over crowded. They should design a unique incentive structure to attract potential investors. They should also provide residential facilities near economic zones.

Already established industries in Pakistan like textile, cement, household appliances, surgical equipment, mineral resources etc., will be the potential candidates for such SEZs.

This will be a huge step for Pakistan if properly implemented. Considering that China is also in the phase of upgrading its industrial base, CPEC may face some issues in obtaining the necessary material. The adequate coordination between two countries and the provincial and federal governments of Pakistan and designing an appropriate incentive structure are the necessary conditions for the success of SEZs under CPEC.

Riaz Haq said...

NPR's Phillip Reeve, on train ride across Pakistan, finds ordinary Pakistanis strongly support the military:

REEVES: Glacier - that's the Siachen Glacier, the world's highest battlefield. It's a giant sweep of ice and snow nearly 20,000 feet up in the Himalayan Mountains. A standoff between the Pakistani and Indian armies has been going on there for more than 30 years. There's been intermittent fighting. But the real killers are the weather and the altitude. Life up there is very harsh, says Ali.

ALI: (Through interpreter) There's very little oxygen. Breathing is difficult, and you never feel like eating. There are many hardships.

REEVES: Extreme cold and also avalanches have claimed many hundreds of lives over the years. Ali worries about frostbite.

ALI: (Through interpreter) You can get frostbite on the ear, on the nose, on the fingers. If you get it on any part of the body, then it must be amputated, as there's no cure.

REEVES: Ali's in good spirits today. He's heading home on our train to his wife to begin one month's leave. He set off from the mountains four days ago and still has one more day of travel. Ali's 24 and a sepoy. That's the same as a private. He signed up for the Pakistani military at 17 but didn't want to.

ALI: (Through interpreter) I joined because my father ordered me.

REEVES: Ali says he really wanted to be in the Navy. But now, he's gotten used to the army and the tough conditions.

ALI: (Through interpreter) Despite all that, I now enjoy it.

REEVES: People on our train seem to treat Ali with much respect. Pakistanis we've met on this journey are profoundly disillusioned with their government yet strongly approve of their army. Their nation's spent roughly half of its history and some of its darkest years under military dictatorship, yet some Pakistanis say they'd be happy to get rid of their elected civilian government and be ruled by generals again. Zaman Saeed's an anti-narcotics official and a passenger on this train.

ZAMAN SAEED: (Through interpreter) It would be better. Pakistan would improve.

REEVES: Saeed would like the military to run the country, but just for a few years.

SAEED: (Through interpreter) They should spend three years sorting out all crocodiles who commit corruption and destroy Pakistan. After that, there's no harm restoring democracy.

REEVES: Pakistanis tend to revere their military because they believe it's done a great job reducing violence in recent years by driving the Pakistani Taliban out of the mountains bordering Afghanistan and going after militant outfits in Karachi. The army's harsh tactics cause deep resentment in some areas, though, like Balochistan province, where there's a separatist insurgency.

But we're traveling through Pakistan's heartland - the provinces of Punjab and Sindh. Here, the army has many fans. And a sharp surge in tensions with the old foe, India, seems to be making the military even more popular. Twenty-seven hours after setting out, we're arriving.

The outskirts of Karachi look pretty shabby - lots of slums, narrow alleys, lots of trash on the ground, motorbikes trying to squeeze their way down these tiny lanes, animals, washing hanging out, lots of little kids wandering about.


REEVES: Our train draws in. This is the giant metropolis, the port city that makes most of the money that fuels Pakistan's economy.

There we are - Karachi.

The platform's crowded with porters in long, dark-green robes, carrying baggage on their heads. That conversation on the train about an army takeover has left me wanting to learn more. Could Pakistan's military really rule again one day? I get a cab to the Karachi Press Club. The club has a history of challenging dictators. It doesn't allow anyone in military uniform through its doors.

Riaz Haq said...

Via @NPR: Phillip Reeve on train ride thru #Pakistan finds the Army is very popular in the country.

REEVES: Glacier - that's the Siachen Glacier, the world's highest battlefield. It's a giant sweep of ice and snow nearly 20,000 feet up in the Himalayan Mountains. A standoff between the Pakistani and Indian armies has been going on there for more than 30 years. There's been intermittent fighting. But the real killers are the weather and the altitude. Life up there is very harsh, says Ali.

ALI: (Through interpreter) There's very little oxygen. Breathing is difficult, and you never feel like eating. There are many hardships.

REEVES: Extreme cold and also avalanches have claimed many hundreds of lives over the years. Ali worries about frostbite.

ALI: (Through interpreter) You can get frostbite on the ear, on the nose, on the fingers. If you get it on any part of the body, then it must be amputated, as there's no cure.

REEVES: Ali's in good spirits today. He's heading home on our train to his wife to begin one month's leave. He set off from the mountains four days ago and still has one more day of travel. Ali's 24 and a sepoy. That's the same as a private. He signed up for the Pakistani military at 17 but didn't want to.

ALI: (Through interpreter) I joined because my father ordered me.

REEVES: Ali says he really wanted to be in the Navy. But now, he's gotten used to the army and the tough conditions.

ALI: (Through interpreter) Despite all that, I now enjoy it.

REEVES: People on our train seem to treat Ali with much respect. Pakistanis we've met on this journey are profoundly disillusioned with their government yet strongly approve of their army. Their nation's spent roughly half of its history and some of its darkest years under military dictatorship, yet some Pakistanis say they'd be happy to get rid of their elected civilian government and be ruled by generals again. Zaman Saeed's an anti-narcotics official and a passenger on this train.

ZAMAN SAEED: (Through interpreter) It would be better. Pakistan would improve.

REEVES: Saeed would like the military to run the country, but just for a few years.

SAEED: (Through interpreter) They should spend three years sorting out all crocodiles who commit corruption and destroy Pakistan. After that, there's no harm restoring democracy.

REEVES: Pakistanis tend to revere their military because they believe it's done a great job reducing violence in recent years by driving the Pakistani Taliban out of the mountains bordering Afghanistan and going after militant outfits in Karachi. The army's harsh tactics cause deep resentment in some areas, though, like Balochistan province, where there's a separatist insurgency.

But we're traveling through Pakistan's heartland - the provinces of Punjab and Sindh. Here, the army has many fans. And a sharp surge in tensions with the old foe, India, seems to be making the military even more popular. Twenty-seven hours after setting out, we're arriving.

The outskirts of Karachi look pretty shabby - lots of slums, narrow alleys, lots of trash on the ground, motorbikes trying to squeeze their way down these tiny lanes, animals, washing hanging out, lots of little kids wandering about.


REEVES: Our train draws in. This is the giant metropolis, the port city that makes most of the money that fuels Pakistan's economy.

There we are - Karachi.

The platform's crowded with porters in long, dark-green robes, carrying baggage on their heads. That conversation on the train about an army takeover has left me wanting to learn more. Could Pakistan's military really rule again one day? I get a cab to the Karachi Press Club. The club has a history of challenging dictators. It doesn't allow anyone in military uniform through its doors.

Riaz Haq said...

#Pakistan's domestic #cement sales show 12% growth in Nov 2016. #CPEC …

Cement sales are likely to post nine percent year-on-year (YoY) jump in November due mainly to strong domestic demand, a brokerage reported on Thursday. Analyst Nabeel Khursheed at Topline Securities said cement industry is expected to record sales of 3.7 million tons in November.

Local sales are expected to be at 3.2 million tons in November, up 12 percent YoY and five percent month-on-month (MoM). “We remain upbeat on local sales outlook, owing to large scale infrastructure developments and higher demand from private sector,” Khursheed added. Exports are likely to remain at 0.5 million tons, up six percent YoY, but down four percent MoM. “This is mainly because of a likely 20 percent decline in dispatches to Afghanistan,” the equity analyst added. The neighbouring Afghanistan consumes 35 percent of Pakistan’s cement exports. The brokerage, citing the Pakistan Bureau of Statistics, said retail cement prices were in the range of Rs520 to 540/bag in north and Rs567-580/bag in south region in November. An average nationwide price was Rs545/bag.

Cement sales are likely to increase around nine percent to 16 million tons in the first five months of this fiscal year. Local sales would be up 11 percent to 13.6 million tons in the July-November period.

Riaz Haq said...

#Pakistan sets up special #maritime force to secure #CPEC-linked sea lanes to #Gwadar | IHS Jane's 360 …

The Pakistan Navy (PN) has set up a new maritime force known as Task Force-88 (TF-88) to protect sea lanes linked to the China-Pakistan Economic Corridor (CPEC), which is expected to trigger a surge in maritime activity at the country's Gwadar Port on the Arabian Sea.

The new task force, which will reportedly comprise naval vessels, manned and unmanned aircraft, and other surveillance assets, was established on 13 December "for [the] maritime security of Gwadar Port and [the] protection of associated sea lanes against both conventional and non-traditional threats", according to a DAWN newspaper report.

Marines are also set to be deployed at sea and around the port to enhance security, a senior PN official was quoted by the paper as saying.

Riaz Haq said...

#Pakistan Turns to #China in #Energy Binge With $21 Billion Investment. #Electricity #CPEC … via @WSJ

More than 10,000 Chinese workers are now building at least 10 partly Beijing-financed energy projects across Pakistan that are set to grow the country’s energy output by 60% within two years in the first major boost to supply in two decades.Mr. Sharif’s government plans to inaugurate a nuclear plant this month and a pipeline network in January that will carry large-scale gas imports upcountry.

“Never in the history of Pakistan has there been such a big package of electricity plants in the pipeline,” said Syed Akhtar Ali, in charge of energy at the Planning Commission, the ministry tasked with long-term development.

Mr. Sharif’s promise to solve the electricity crisis propelled him to office at a time when the energy deficit was knocking some 2 percentage points off growth, economists say, stifling industry and leaving school children to study by candlelight.

Pakistan’s economic growth has risen to almost 5% annually under Mr. Sharif’ and his government set a 7% target for the years ahead. That, his government hopes, will boost the moribund private sector, reduce unemployment and provide youth with more alternatives to extremism.

The energy plan is a centerpiece of that economic aspiration. Mr. Sharif is racing to fulfill his pledge and become the first incumbent to be re-elected in a country whose voters—or the interventionist military—have long ousted its leaders for their poor performance. Mr. Sharif, who led Pakistan twice before in the 1990s, hasn’t previously even completed a term in office.

“Electric power is going to be the swing factor in the election,” said Shahid Khaqan Abbasi, the minister for petroleum. “If we don’t deliver on power, we won’t be seen as having delivered.”

Mr. Sharif’s plan depends heavily on ​China, which​ is translating its long-term strategic ties with Pakistan into an economic partnership, part of a broader infrastructure push across Eurasia. China is financing many plants as commercial investments. But to expedite projects, the Pakistani government is funding ​some​ power stations in the run up to the election, including three gas-fired plants in Mr. Sharif’s home province of Punjab. The eventual aim is to more than double Pakistan’s current output of around 16,000 megawatts.

By comparison, Washington’s multibillion-dollar civilian aid program for Pakistan has been far less ambitious, adding 1,000 megawatts to the country’s power generation in recent years by enhancing existing power stations.

The plan is to add 10,000 megawatts of the new China-backed infrastructure, a mixture of coal, gas and hydro electricity, by early 2018, months before elections, at a cost of $21 billion. The schedule is tight. The massive amounts of natural gas and coal needed for the plants require an extensive delivery system of ports, pipelines and railways. The country also needs to upgrade its power distribution network to be able to carry the extra electricity.

“My concern is that gaps in longer term planning, including much needed structural, regulatory and market reforms, will once again fall by the wayside in the euphoria of having achieved a temporary electricity supply surplus,” said Jamil Masud, a partner at Hagler Bailly Pakistan, an energy consultancy,

At Karachi’s Port Qasim, a $2 billion coal-fired plant is taking shape. After only 1.5 years under construction, one 400-foot high cooling tower is up and the second is almost complete. The hulking metal frames for the boilers are in place and a jetty for imported coal is taking shape. Around 4,000 people work on the site, 24 hours a day—half of them Chinese workers who aren’t allowed to step outside its boundary.

On the other side of the port, a massive tanker ship serves as a terminal for liquefied natural gas imports, which are piped across Pakistan. Three more terminals are planned by the government.

Riaz Haq said...

#China to set up large steel plant at #Gwadar, #Pakistan: Chinese Envoy. #CPEC … via @Associate Press Of Pakistan

Acting Chinese Ambassador to Pakistan, Zhao Lijian Monday said that his country would set up a large steel factory at Gwadar to further expedite economic developments being carried out under China-Pakistan Economic Corridor (CPEC) framework.
“Both China and Pakistan would very soon sign an agreement to establish the steel factory, three times bigger than the free economic zone being set up in Gwadar city,” he made this announcement while addressing participants of a day-long conference on CPEC: Potential and Prospects organized by Strategic Vision Institute (SVI) here.
He said, industrial cooperation was the forth pillar of CPEC initiative and both the country would discuss it in the next meeting of Joint Cooperation Committee (JCC) of CPEC to be held in Beijing this month.
“After completion of energy projects, transport infrastructure and development of Gwadar Port, industrial cooperation between China and Pakistan will be the main topic at the next JCC,” he added.
Zhao Lijian informed that China was working a lot for the development of Gwadar Port which was built with the Chinese government’s assistance.
He said, after completion, the port was handed over to Singapore but there was no improvement even after passage of five years.
Finally, it was given to the Chinese government by Pakistan government and the port was made functional and a ship carrying Chinese goods left for Africa.
He said, a business centre, hostel for different companies, fisheries processing plant with cold storage facility had been established in the free economic zone spread over around nine kilometers.
About Gwadar airport up-gradation, he said, the new international airport would have landing facility for all the modern aircraft including A-380 Airbus after completion, adding, prior to the up-gradation only C-130 or propeller-planes could land at the old airport.
The Acting Chinese Ambassador said, a 150-bed hospital was being built for the treatment of local people while a vocational institute had been set up for imparting training of different skills especially for the fishermen.
Talking about different energy project being completed under CPEC initiative in different parts of Pakistan, he particularly mentioned about the coal-based power plants which were being built in accordance with environmental standard set by the World Bank (WB) and other concerned international organizations.
He said, China produces around 60 percent of its total power generation through coal based power stations using modern and state of the art technology.
“The environmental concerns will be taken into consideration during the completion of these power stations,” he added.
Zhao Lijian pointed out hydro power plant, coal based power plants, wind power plants and solar based power plants were being set up to meet the electricity shortage in Pakistan.
He informed that the Karot Power Plant was being financed by the Silk Bank established by the Chinese government.
The groundbraking of Suki Kinari, Kohala Hydro Power Project would be held early next year, he said and added, Sahiwal Power Plant and Port Qasim Power Plant would be completed by next June and December respectively.
He said, a power plant set up at Thar coal site would also be inaugurated in next June.
He said, HUBCO power plant, one of the biggest coal-based power plant, would provide constant and stable power supply throughout the year.

Riaz Haq said...

Dr Jean-Francois Di Meglio, President of #Asia Centre in #France: "#CPEC is a game-changer for #Pakistan". #China

KARACHI: China may have more core benefits from the China Pakistan Economic Corridor (CPEC) but it’s a game-changer for Pakistan which will also benefit from it. Contrary to what some Europeans think, Pakistan has a strategic position in the region.

This was one of the main points raised by Dr Jean-Francois Di Meglio in his lecture on ‘The Economic, Strategic and Environmental Consequences of the New Silk Roads’ at the Area Study Centre for Europe (ASCE), University of Karachi, on Wednesday.

Dr Di Meglio, who is President, Asia Centre, France, said he was not an expert on CPEC so what he would talk about was based on his experiences. He said his talk was divided in two parts: Europe’s standpoint on the Silk Road project and China’s point of view.

Regarding the first part, Dr Di Meglio said when China announced the project in 2013, Europeans were doubtful about it. They thought since it was a 35-year project nothing could be achieved in the short term. They also thought that China was trying to rejuvenate something that used to exist in the past and there was no point doing it. Some people, however, harboured the notion that it was part of a grand plan. It was innovative because earlier the flow [of goods] was from West to East and now China was trying to reverse the direction of history.

Shedding light on what Silk Road used to be, Dr Di Meglio said in the late 20th century it was just a road but also entailed some key points and strategic places, one of which was the area crossing the border between Pakistan and Afghanistan. In modern history, he said, two significant events took place. The first was the Great Game between Russia and Britain at the end of the 19th century where Russia had accumulated wealth and wanted access to the sea; the other was the Afghanistan War that resulted in the disintegration of the USSR.

Dr Di Meglio said it was complicated for Europeans to talk about CPEC but countries like Germany and France had shown interest in it. With regard to negative feedback, some Central Asian countries were of the view that Russia was trying to re-establish links with China and the risk was that “China would be too much present”. But the Europeans discarded many important factors, he said.

On the Chinese approach to the situation Dr Di Meglio said [economic] reforms in China started in 1978 and after 35 years, in 2013, they came up with another project. If you looked at the dates, another 35 years added to 2013 would mean the arrival of the year 2048. In 2047 Hong Kong would come back to Chinese sovereignty fully; and 2049 would be the 100th anniversary of the People’s Republic of China. He said reforms brought in 1978 came through a simple process: enrichment. If the people were richer they would be easier to manage. The Silk Road had the potential of making some countries marginally richer. That could be done by building infrastructure and by linking them up with China.

Dr Di Meglio said CPEC was not an easy project but was not the most difficult to achieve either. There was room for Pakistani companies and politicians to take the initiative and speak to the Chinese for a level playing field as much as possible. Whosoever was going to benefit more from it, it was a game-changer for Pakistan. He argued that let’s say Pakistan was only benefiting 10 per cent from the project; even then you had other benefits like “influence” and “footprint”. He said some Europeans thought that Pakistan existed because there was a partition in 1947; they did not realise that Pakistan had an important strategic position.

On China’s ambitions, Dr Di Meglio said while it wanted prosperity and stability, it did not want domination in the region. China knew that in the past empires rose and fell. “The way to last long is not to dominate other countries but to play with them.”

Riaz Haq said...

#Pakistan Stock Exchange says #China-led consortium (#Shanghai, #Shenzen bourses) bid highest 4 #PSX. #CPEC … via @WSJ

A Chinese-led consortium, including the Shanghai Stock Exchange, emerged as the top bidder Thursday for a 40% stake in the Pakistan Stock Exchange, one of the best-performing markets in Asia this year.

The Pakistan Stock Exchange, formerly the Karachi Stock Exchange, said the consortium includes three Chinese exchanges: the China Financial Futures Exchange as the lead bidder, the Shanghai Stock Exchange, and the Shenzhen Stock Exchange. The consortium also includes two Pakistani financial institutions: Pak China Investment Company Limited and Habib Bank Ltd.

The consortium’s winning offer, subject to regulatory approval, of 28 rupees ($0.27) per share values the stake at $85.5 million, and the exchange at $213.7 million.

The Pakistan Stock Exchange has been one of the best-performing markets in Asia this year, with its benchmark KSE 100-stock index gaining 42% this year. MSCI announced in June this year that it will upgrade Pakistan, earlier classified as a frontier market, to include it in its Emerging Markets Index.

The sale of the 40% stake is “big news not only for us, but also for the country,” said Shehzad Chamdia, chairman of the Pakistan Stock Exchange divestment committee. “I think it will be a game changer for our capital markets.”

Mr. Chamdia said the consortium’s offer is structured so that the three Chinese exchanges will have 30% of the exchange, while the two local partners will have 5% each. Along with board seats, the consortium will also get to nominate the CEO and CFO at the exchange, Mr. Chamdia said.

Pakistan has seen major Chinese investment in recent months, especially under the China-Pakistan Economic Corridor, a multibillion-dollar infrastructure program to upgrade the land route between the two countries and also boost Pakistan’s energy generation capacity.

Separately, China’s state-owned Shanghai Electric Power Co. acquired a controlling stake in K-Electric, the power utility in Karachi, Pakistan’s largest city.

Prime Minister Nawaz Sharif’s government considers boosting foreign investment a key pillar of its plan to revive Pakistan’s economy, and has pointed to the performance of the country’s stock exchange during his tenure as a sign of economic progress.

Riaz Haq said...

#Pakistan gets additional $1 bn in #Chinese financing for roads, bringing #CPEC to $55 billion so far. via @Reuters

Dec 27 Pakistan expects to secure soft loans from China of about $1 billion this week for three road projects in the China-Pakistan Economic Corridor (CPEC), a Pakistani official said on Tuesday.

The roads lie on the western route of CPEC, a $55 billion network of roads, rail links, power plants and other infrastructure connecting western China to Pakistan's southern port of Gwadar.

They include roads from Raikot to Thakot, Yarik to Zhob and from Basima to Khuzdar, Ashraf Zaman, spokesman for Pakistan's National Highway Authority (NHA) told Reuters.

Zaman said a deal was reached with the Chinese to finance the three additional roads in November.

"Hopefully, agreement will be signed between the two countries in this regard in China-Pakistan Joint Cooperation Committee (JCC) meeting to be held on Dec. 29 in Beijing," he said.

Riaz Haq said...

#Pakistan Opens New 340MW Nuclear Power Plant Built With #China's Help. #CPEC

Pakistan Prime Minister Nawaz Sharif has inaugurated a nuclear power facility built with the assistance of China.

The plant at Chashma, in Pakistan's Punjab province, adds 340 megawatts to the national grid. Beijing has already constructed two other nuclear reactors, with a combined capacity of more than 600 megawatts.

The three power plants at Chashma are known as C-1, C-2 and C-3 respectively. They are are part of broader plans to overcome long-running crippling power shortages in Pakistan.

“The next (nuclear) power projectwith an installed capacity of 340 megawatts, C-4, is also being built here (in Chashma with Chinese assistance). God willing, it will be operational and connected to the national grid in April, 2017,” Sharif told Wednesday’s ceremony.

Pakistan’s current electricity output stands at around 16,000 megawatts, including nuclear power production.

The government plans to increase the power production by about 60 percent, mainly through Chinese-funded coal, gas and hydro-electricity projects under construction to try to boost Sharif’s re-election bid in next polls due in early 2018.

When Sharif took office in 2013Pakistanis were facingcompulsory power outages for up to 12 hours a day, crippling daily life and plunging businesses into darkness.

The prime minister in his speech Wednesday reiterated his election promise to resolve the crisis by the next elections.

Officials say that Chinese experts and engineers had been running the newly-built C-3 plant “on a trial basis” for three months until they formally handed over its control to their Pakistani counterparts Wednesday.

Beijing is also helping Islamabad construct two nuclear power plants in the southern port city of Karachi at a cost of around $10 billion. The projects, with a combined capacity of around 2,200 megawatts, are scheduled to be completed by 2021.

Under the agreement, China will also provide enriched uranium for fuel.

The Pakistan Atomic Energy Commission (PAEC) envisages a nuclear power production of around 8,800 megawatts by 2030.

Pakistan built its first nuclear power plant of 137 megawatts at Karachi in 1972 and it is still in operation, though at a much reduced capacity.

China is the only country helping Pakistan build nuclear power plants because Western nations have put a moratorium on the supply of these facilities citing Islamabad’s nuclear weapons program.

Under a multi-billion dollar cooperation agreement, Beijing is also helping Pakistan construct a network of roads, rails, communication and power projects to boostties between the two traditionally close allies.

The bilateral cooperation under the China-Pakistan Economic Corridor (CPEC) plans to link the northwestern Xinjiang region to Pakistani deep-water port of Gwadar Gwadar in the Arabian Sea, providing Beijing the shortest possible access for its imports and exports to international markets.

Riaz Haq said...

#China to Fund 4,000 MW Power Transmission Line in #Pakistan. #CPEC … via @thewire_in

State Grid of China will help build a 4,000 MW power transmission line in Pakistan in a project valued at $1.5 billion, Pakistan said on Friday, the latest in a series of Chinese investments in its South Asian neighbour.

The high-capacity transmission line will be the first of its kind in Pakistan and will link Matiari town in the south, near a new power station, to Lahore city in the east, a key link in transmission infrastructure, the Pakistani government said.

An agreement on the project was signed on Thursday in Beijing between Mohammad Younus Dagha, Pakistan’s secretary of water and power, and Shu Yinbiao, chairman of State Grid Corporation of China, the government said in a statement.

Construction will begin in January, and should take about 20 months, said a spokesman for the Pakistani prime minister’s office.

Pakistan has been plagued by a shortage of electricity for years, with widespread rolling blackouts in both rural and urban areas.

The government has managed to reduce load shedding – scheduled power outages – in some areas, but production gaps and distribution woes remain.

The project is the latest in a series of big Chinese investments, most of which fall under a planned $55 billion worth of projects for a China Pakistan Economic Corridor.

The corridor is a combination of power and infrastructure projects that link western China to Pakistan’s southern port of Gwadar.

Other Chinese investment in Pakistan has included the acquisition of a majority stake by Shanghai Electric of the K-Electric power production and distribution company for $1.8 billion.

Last week, a Chinese-led consortium bought a 40 percent stake of the Pakistan Stock Exchange for an estimated $85 million.

Riaz Haq said...

#Pakistan Builds New Missile Boat to Protect Key Trade Routes #CPEC #Gwadar …

Pakistan has commenced construction of a new type of missile boat as part of efforts to modernize its navy to ensure security for the China-Pakistan Economic Corridor (CPEC), a trade route linking western China to the Arabian Sea via Pakistan’s deep water port of Gwadar.

Pakistan hopes the CPEC will revive its economy, whereas China’s trade and energy resources will be bypassing the Malacca Strait.

First steel for the boat was cut Dec. 29. Images from the ceremony revealed it to be a development of the Azmat-class missile boat designed for Pakistan by China. Three Azmat boats have been built, one in China and two in Pakistan by state-owned Karachi Shipyard & Engineering Works (KSEW).

A statement by the military’s Inter Service Public Relations media arm revealed that the boat, which is considered the first indigenously designed missile boat, was developed by Maritime Technologies Complex and would have the “latest weapons and sensors.”

Though released images from the ceremony leave some questions unanswered about the new vessels' exact features, notable differences from the base model include new missiles, a redesigned forward superstructure and a possible replacement of the twin 25mm cannon.

The navy declined to provide further details regarding the changes.

Defense News first learned of the new missile boat during IDEAS 2016, Pakistan’s biennial defense exhibition held in November, when spokesmen for the shipyard KSEW and the sea service separately revealed the existence of the program.

Though unwilling to go into detail, they said the new design would feature new weaponry, sensors and materials. Future plans include an indigenous combat management system, anti-ship missiles and possibly air-defense missiles, the lack of which is presently a notable weakness.

The Azmat missile boats are armed with eight C-802A/CSS-N-8 Saccade anti-ship missiles, but the new design is clearly armed with six larger missiles. Speculation is that the weapons are the C-602, an export development of China’s YJ-62, which is in Pakistani service as a coastal defense missile named "Zarb."

The subsonic C-602 has a reported range of 280 kilometers and carries a 300-kilogram warhead. It packs a bigger punch and has longer reach than the C-802A.

However, last year, a Ministry of Defence Production report revealed a ship-board launcher for a land-attack cruise missile was under development.

Pakistan’s only surface-launched, land-attack missile is the indigenous Babur. Thus far there have been no reports of an anti-ship variant, but fitting the C-602 seeker to the missile would certainly expedite development.

News of the new missile boat comes amid Chinese reluctance to establish a permanent presence in the area, forcing Pakistan to forge ahead with efforts to improve its maritime security, albeit with Chinese help.

Riaz Haq said...

#China investment boosts #Pakistan's economic growth- #CPEC #infrastructure #power #ports #coal Nikkei Asian Review

More than $35 billion of the CPEC investment will be allocated to energy projects. Once completed by the end of next year, power generation projects are likely to help Pakistan overcome its crippling power shortages, a major bottleneck for growth. This is a big reason the CPEC is welcomed by many in Pakistan's industry, who say it is going to be a "game changer" for the country.

China also recognizes that the CPEC initiative will help secure the quickest trade route connecting the country's western Xinjiang region and other landlocked areas to the Arabian Sea, which could facilitate economic development in the Chinese hinterland. The infrastructure development initiative will also allow China to mitigate the problem of overcapacity at home by exporting materials and equipment to Pakistan.

There are proposals to develop a power plant, an airport and highways and other facilities particularly around the port of Gwadar on the southwestern coast of Pakistan, which is strategically important for China as it provides the country easy access to the sea.


According to a local newspaper, $700 million of the $1.1 billion spent on CPEC-related projects in the July-September period last year was financed by loans from the China Development Bank. The amount is mainly earmarked for importing materials and equipment from China, which are needed to complete the projects.

Many in Pakistan have voiced concern over the country's rising debt obligations to China. Also, Chinese companies typically bring their own engineers and workers in large numbers to do work in Pakistan.

"Surging imports from China will damage local companies," said Ehsan A. Malik, CEO of the Pakistan Business Council, which represents 62 major companies and organizations. "Tax revenue and employment will not increase." He added, "CPEC may be a Trojan horse."

However, the logic of companies participating in CPEC is very simple. "We asked China, because nobody in the world finances coal projects," said Hussain Dawood, chairman of Dawood Hercules, a large Pakistani conglomerate that includes the Engro group, which is involved in the production of energy and chemicals.

"Investment in CPEC is not only from China," said Arif Habib, CEO of the Arif Habib group. "Companies from Germany, Denmark and Saudi Arabia are also showing interest."

Despite widespread concern about the health of China's economy, Ahsan Iqbal, Pakistan's minister of planning and development, said confidently: "The CPEC projects are a high priority for Chinese companies because they can expect good returns. Even though the Chinese economy is slowing down, the companies still have huge cash reserves."

Many Japanese companies also think the best thing to do now is to take advantage of Chinese-built infrastructure in Pakistan to expand their own business. No matter who invested, if energy and infrastructure investment gains momentum, it could stimulate Pakistan's economy.

Amid all the speculation, Pakistan is moving toward its goal of becoming the next big emerging market by gradually shaking off its reputation for terrorism, corruption and political blunders.

Riaz Haq said...

#Land rush around #Pakistan's #Gwadar port triggered by #Chinese investment | Reuters #CPEC
Pakistani real estate giant Rafi Group made a ten-fold profit last year from its sale of hundreds of acres of land in the remote fishing town of Gwadar, acquired soon after the government announced plans for a deep-sea port there.

The windfall came after 12 years of waiting patiently for the Gwadar port to emerge as the centrepiece of China's ambitious plans for a trade and energy corridor stretching from the Persian Gulf, across Pakistan, into western Xinjiang.

"We had anticipated the Chinese would need a route to the Arabian Sea," Rafi Group Chief Executive Shehriar Rafi told Reuters. "And today, all routes lead back to Gwadar."

Gwadar forms the southern Pakistan hub of a $57-billion China-Pakistan Economic Corridor (CPEC) of infrastructure and energy projects Beijing announced in 2014.

Since then, land prices have skyrocketed as property demand has spiked, and dozens of real estate firms want to cash in.

"Gwadar is a 'Made in China' brand and everyone wants a piece," said realtor Afzal Adil, one of several who shifted operations from the eastern city of Lahore in 2015.

Last year, Pakistan welcomed the first large shipment of Chinese goods at Gwadar, where the China Overseas Ports Holding Company Ltd took over operations in 2013. It plans to eventually handle 300 million to 400 million tons of cargo a year.

It also aims to develop seafood processing plants in a nearby free trade zone sprawled over 923 hectares (2,281 acres).

The route through Gwadar offers China its shortest path to the oil-rich Middle East, Africa, and most of the Western hemisphere, besides promising to open up remote, landlocked Xinjiang.

Last year, the Applied Economics Research Centre estimated the corridor would create 700,000 jobs in Pakistan and a Chinese newspaper recently put the number at more than 2 million.

Authorities have completed an expressway through Gwadar, which has a 350-km (218-mile) road network. A new international airport kicks off next year, to handle an influx of hundreds of Chinese traders and officials expected to live near the port.

The volume of Gwadar property searches surged 14-fold on Pakistan's largest real estate database,, between 2014 and 2016, up from a prior rate of a few hundred a month.

"It's like a gold rush," said Chief Executive Zeeshan Ali Khan. "Anyone who is interested in real estate, be it an investor or a developer, is eyeing Gwadar."

Prices, which have risen two- to four-fold on average, are climbing "on a weekly basis," said Saad Arshed, the Pakistan managing director of online real estate marketplace

Regional fishermen have held strikes during the last two years, to protest against being displaced by the port.

To keep pace with the interest, urban officials are struggling to computerise land management and record-keeping. "We are trying to upgrade as fast as we can," said Zakir Majeed, an official of the Gwadar Development Authority (GDA).

But Gwadar lacks basic education and health facilities, in contrast to the gleaming towers and piped drinking water of the "smart city" envisioned by the GDA.

"For commercial projects, things are moving fast," Lamudi's Arshed said. "But people actually living there, that will take a long time."

Port officials expect the population to hit 2 million over the next two decades, from about 185,000 now.

Riaz Haq said...

#UN Security Council Endorses #CPEC (#Pakistan) and #China's #OBOR projects. #India unhappy. # via @htTweets

A UN Security Council resolution has for the first time incorporated China’s Belt and Road Initiative (BRI), a multi-billion inter-continental connectivity mission that has a flagship project passing through Pakistan occupied Kashmir (PoK).

The resolution, which extends an ongoing UN assistance mission to Afghanistan, says international efforts should be strengthened to implement the BRI, President Xi Jinping’s legacy project about which he first spoke in 2013.

Beijing claims it has rounded up at least 100 countries in BRI’s support, including Pakistan, Bangladesh and Sri Lanka.

India is yet to sign up for the initiative. Foreign secretary S Jaishankar spelt it out to the Chinese government in February that India has a “sovereignty” issue with the BRI because its flagship project, the China-Pakistan Economic Corridor (CPEC), passes through PoK. According to diplomats, India endorsing the BRI would mean giving up its claims on PoK.

The UN endorsing the BRI could complicate the situation as far as India’s claims are concerned.

The resolution in question renewed the mandate of the UN Assistance Mission in Afghanistan for one year. In it, the 15-nation UN body urged to promote security and stability in Afghanistan and the region “to create a community of shared future for mankind”.

“Also included in the newly adopted council resolution was China’s Belt and Road Initiative, which aims to build a trade and infrastructure network connecting Asia with Europe and Africa along the ancient trade routes,” official news agency Xinhua reported.

The resolution “welcomes and urges further efforts to strengthen the process of regional economic cooperation, including measures to facilitate regional connectivity, trade and transit, including through regional development initiatives such as the Silk Road Economic Belt and the 21st-Century Maritime Silk Road (the Belt and Road) Initiative”.

The council resolution urged “further international efforts to strengthen regional cooperation and implement the Belt and Road Initiative”.

Besides the BRI, the resolution also mentions other projects like “regional development projects, such as the Turkmenistan-Afghanistan-Pakistan-India gas pipeline project, the Central Asia South Asia Electricity Transmission and Trade Project, the Chabahar port project agreed between Afghanistan, India and the Islamic Republic of lran”.

China has taken the inclusion of BRI in a UN resolution as a diplomatic victory of sorts.

Riaz Haq said...

China-Pakistan economic corridor unacceptable to India: Shivshankar Menon

THE CHINA-Pakistan Economic Corridor (CPEC), as it stands today, is not acceptable to India, Shivshankar Menon, a former National Security Adviser to the Government of India, said on Friday. “The sovereignty aspect of the CPEC, as proposed now, is unacceptable to us,” Menon said during a conference on The Belt and Road Initiative (BRI): India’s perspectives on China’s ambitious plan. The former diplomat’s statement comes at a time when China has made a fresh attempt at inviting India’s interest in President Xi Jinping’s pet project, the BRI, of which CPEC is a part.
On March 4, Chinese diplomat Fu Ying asked India to reconsider its position on the BRI keeping in mind the “larger picture”. India has been wary of the CPEC as a part of it passes through Pakistan Occupied Kashmir. “For India, there is an added contradiction that the CPEC passes through Indian territory under Pakistani occupation,” Menon said. By making “long-term financial investment in the initiative”, he said, China seems to “solidify and legitimise that occupation”, Menon said at the conference held in Mumbai by the Observer Research Foundation.
The conference was held to deliberate India’s position on the BRI ahead of China’s first international forum in May. Several economists, diplomats and mediapersons participated in panel discussions. While Menon acknowledged the economic benefits of the trans-continental initiative that connects 60 countries in Asia and Europe, he said that not all projects under the BRI were for economic justification, including the CPEC.
“Not all projects under the BRI are economically viable, which suggests that there is geo-strategic motivation involved,” he said, adding that most parts of the BRI passed through some of the “most insecure” regions. Menon, however, stressed that India would be more willing to join the BRI if it were more comfortable about the security in the regions concerned and the geopolitical context within which BRI is proposed.

Riaz Haq said...

FWO installs CCTV cameras at Khi-Hyd M-9 Motorway

Frontier Works Organisation (FWO) has installed CCTV cameras at 136 KM Khi-Hyd M-9 Motorway for proper monitoring of traffic flow.

This was said by Frontier Works Organisation (FWO) CORE project M-9 Karachi-Hyderabad Motorway Chief Operating Officer Brigadier Tahir Siddiqui during a press conference in Nooriabad.

The organisation is the pioneer in BOT services—a service introduced by FWO with a purpose to reduce the burden on the public sector for development of large size infrastructural projects, said Tahir Siddiqui.

The Karachi-Hyderabad Motorway (M 9) is one of the BOT project achieved through competitive bidding process, added the project’s chief operating officer.

On the occasion, COO GS Col Mansoor Ahsen, M-9 Project Director Col Rashid, BOT Director Daud Suleman and PRO Abdullah Hafeez –the representatives of FWO– also briefed media during the visit at a Nooriabad location.

Bgdr Tahir said that the NHA has given rights of its development and subsequent operation and regulator maintenance for 25 years under a Concession Agreement to FWO-owned private limited company ‘SCORE’, which is lawfully registered in SECP observing all corporate governance regulations.

The overall construction cost of the project is Rs 37billion with details of its financing arrangement, underlying the fact that FWO injects 30% as equity share, while 70% is loaned from a consortium of local banks, which will be returned through toll revenue, This needs to be understood that the toll being collected during construction is being utilised for the construction and partially for debt servicing only, he said.

For first 10 years major chunk of toll will be used for debt repayment, and remaining will be used for operation, maintenance and management cost. After debt servicing (10 years) sizeable share will be remitted to NHA which will be utilised for other infrastructural projects, he added.

The project constitutes of an overall length of 136km out of which 120Km will be a Motorway Section and 16km will be urbanised portion. There will be eight new interchanges and latest Intelligent Transportation System (ITS) will also be provided. The project is not only limited to construction but includes operations and routine maintenance for 25 Years (till 2040) and 2 x Periodic/major maintenance, he said.

Tahir said that the project commenced in October 2015 with the construction time of 30 months (ie till April 2018). However, the FWO targets to construct the project by August 2017.The sole purpose of expediting the early completion is to reduce inconvenience to commuters during the construction phase

He further told that recently a localised failure has been observed near Loni-kot temporary toll plaza with an approximate length of 1 Lane km (0.5% of project length). These kinds of road failures are termed in engineering as ‘Rutting’ and are caused due to heavy/overloaded but slow traffic (resulting in exponential impact road). Required tests have been carried out to investigate the cause of this failure. As per the requirement, rectification of patch has already been completed.

No extra finances will be claimed from NHA or any other government institute for carrying out these rectification works, he added.

The FWO officials said that over 80,000 different types of trees of neem (Azadirachtaindica), palm (Arecaceae) and corn corpus have been planted alongside the road. Plantation work is carried out as per the elaborated horticulture plan of the M9 Project.

Riaz Haq said...

We’ll make #CPEC a success, come what may: #Pakistan Army Chief Gen Bajwa. #China

General Qamar Javed Bajwa reiterated on Wednesday the determination of the army and other law enforcement agencies to provide fool-proof security to the China-Pakistan Economic Corridor (CPEC) calling the multibillion-dollar project ‘harbinger of peace and prosperity’ in the region.

“While the army will provide security to the project [CPEC], the other national institutions will have to come forward and play their respective roles,” he said while speaking at a function in Islamabad on CPEC Logistics on Wednesday.

“We as a nation can only benefit from this historic opportunity, if we prepare ourselves to embrace it. All national institutions will have to make a deliberate effort to ensure success of CPEC,” he added.
CPEC is truly a harbinger of economic development, peace and prosperity in the region, he said, adding that unlike some other countries of South Asia, Pakistan believes in focusing its energies on peace and inclusiveness, rather than divisive competition. He was apparently referring to India which publicly opposes the multibillion-dollar project.

Country’s progress: Army chief hails role of overseas Pakistanis

“CPEC would bring increasing economic integration among regional economies and reduce the development gap within various regions of Pakistan,” he said.

Gen Qamar said the Chinese investment in various fields, including energy, infrastructure, Gwadar port and special economic zones, can lay the foundation of a fast-developing Pakistan if the opportunity was optimally utilised.

“We take immense pride in our relationship with China that has always remained on an ascending trajectory and now encompasses almost every sphere of our life. The lasting imprint of this brotherly partnership is visible in state-to-state, military-to-military, business-to-business and people-to-people contacts,” he said.

The army chief went on to say that the Sino-Pak relationship is based on the principles of peaceful co-existence, commonality of interest and shared perception on regional and global issues. “We have always stood by each other through thick and thin and at every critical juncture of our history. That is why we are called Iron brothers.

“Xi Jinping’s grand vision of One Belt, One Road (OBOR) has opened up a whole new world of opportunities for the countries of the region and beyond. CPEC, being an important project of OBOR, holds great promise for turning around the economies of Pakistan, Western China and the region,” he added.

Army chief appreciates security forces for ‘winning back dissidents’

The army chief said to reap benefits from CPEC Pakistan needs education, training and skill development of the youth. “We also need to improve our existing laws and regulations to provide a facilitating framework for trade and investment activities. We need infrastructure and urban planning to ensure that we are able to handle large volume of business and transport, without any hassle,” he added.

Commenting on the prevailing security situation in Pakistan, Gen Qamar said the “country is much safer today than before as peace has been restored in Fata and the adjoining areas”. He said normalcy was also returning to Karachi. “Similarly, the law and order situation has improved significantly in Balochistan and there is great focus on socio-economic development in the province,” he added.

“Pakistan is a resilient nation of over 200 million people, with a large ratio of vibrant, capable and enthusiastic youth. We need to capitalize on this opportunity to make Pakistan an economic power in coming years,” he added.

He encouraged entrepreneurs to join hands with Chinese investors and make this dream a reality. “My dream is that by the year 2030, when we complete the current phase of economic partnership between the two countries, Pakistan should at least be in league with middle income countries,” he stated.

Riaz Haq said...

A drive on the newly-constructed highway connecting the port city to Ratodero reveals the trials and tribulations of building infrastructure in conflict-ridden areas

There is great buzz about the M-8 project in Balochistan — locals who use the road on a daily basis say that it has greatly reduced the time needed to travel from Gwadar to Turbat, and indeed, reduced the time for produce and supplies to be transported between cities.

And yet, great things in Balochistan tend to arrive in small, sometimes troubling packages.

A drive on the newly-constructed highway connecting the port city to Ratodero reveals the trials and tribulations of building infrastructure in conflict-ridden areas

Also known as the Gwadar-Ratodero Motorway, the M-8 falls under the purview of the National Highway Authority (NHA). In theory, it is an 893-kilometre-long “motorway” that is supposed to facilitate the movement of people and goods to and from the port city of Gwadar.

Explore: Footprints: Road trip Balochistan

The western end of this motorway is actually a junction known as the Karwat ‘zero point’, some 50 kilometres away from Gwadar. From Karwat, the road snakes through rugged terrain, first to Turbat, then to Hoshab and onwards to Khuzdar.

From Khuzdar, the highway takes a turn towards Sindh, to the town of Ratodero — the “eastern end” of the M-8. Ratodero has gained prominence in recent times for being the lynchpin of the China-Pakistan Economic Corridor (CPEC). The town is a junction where the CPEC’s western, central and eastern road routes all converge. And it is from here that trade between provinces will originate.

The M-8, therefore, is what ties the CPEC plan all together.

Late last year, the Frontier Works Organisation (FWO), who were contracted by the NHA to build the motorway, completed construction of a 200-kilometre-long strip between Gwadar and Hoshab. And although the project is yet to be formally handed over to the NHA, the road is already in use.


A rocky beginning
Twist in the tale: the M-8 wasn’t a CPEC-specific project to begin with.

The M-8 project is also known as the Gwadar-Ratodero Motorway. The project is divided into two sections; the first from Gwadar to Khuzdar, and the second from Khuzdar to Ratodero. Work on the 200-kilometre-long Gwadar to Hoshab segment began back in 2004 under the regime of General Pervez Musharraf. This track was supposed to have been completed in 2006. It has taken 13 long years for construction to conclude.

“The M-8’s first contractor was a Chinese company named Xinjiang Beixin Road & Bridge Group Co. Ltd," explains Muhammad Musa, NHA’s project director in Kech District. “But they left the project when three Chinese engineers were killed in a car bomb blast in Gwadar during the first week of May, 2004.”

The Chinese firm had managed to complete 30 kilometres of the project, from Naleint to Talaar, during their short stint. The construction contract was then awarded to D. Baloch, but for some reason (possibly security-related), they, too, were unable to complete the work.

“The M-8 has gone through many contractors but nobody was able to work on it properly,” says Musa, “until the project was awarded to the FWO in June 2014.”

The FWO was responsible for completing all aspects of construction by October 31, 2017.

But the construction process was marred by violence ever since work started. In July 2015, for example, a press release issued by the Inter-Services Public Relations (ISPR) disclosed that six military personnel and 10 civilian employees of FWO were martyred and 29 severely injured in 136 security-related incidents. Similarly, on May 19, 2017, at least three labourers were gunned down in the Hoshab Bazaar. Despite the violence, work carried on and the highway finally saw the light of day late last year.

Riaz Haq said...

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.