There’s a big chance CPEC may trigger Pak’s Collapse :: Read How
The much-hyped China-Pakistan-Economic-Corridor or CPEC not only challenges India’s sovereignty as it passes through PoK but has all the potential to trigger socio-economic collapse of Pakistan giving rise to instability impacting India and other neighbours.
CPEC that is being touted as the flagship project under Beijing’s One Belt One Road (OBOR) or Belt and Road Initiative (BRI) could make Pakistan politically and economically subservient to China, warn scholars within Pakistan. “The result of CPEC would be Pakistan turning into a country like Greece and taking unprecedented loans in the name of CPEC. Our voice will not be heard until and unless we rebel,” claimed Dr Qaiser Bengali, a Pakistani economist, while addressing a meet in Karachi on Friday ahead of PM Nawaz Sharif’s trip to Beijing for the BRI meet. Indirectly referring to CPEC Dr. Bengali further claimed that all the statistics given by the government are presented in a way that people believe the economy is going in the right direction.
These alarming remarks were made in the backdrop of China deciding to pump additional funds for CPEC. April 16th, Chinese investments in Pakistan through the CPEC were revised upwards, from $46 billion to a whopping $62 billion. As part of CPEC, Beijing plans to build new industrial parks, railways, and roads to link its Xinjiang region with Pakistan’s port city of Gwadar. But instead of giving cause for celebration, the colossal Chinese investments heading to Pakistan have sparked massive protests from locals and environmentalists. Instead of opting for cutting edge technology the Chinese as part of CPEC decided to build power plants in power-starved Pakistan to produce 10,000 MW electricity but using obsolete technology.
A Pakistani scholar who did not wish to be identified told ET that CPEC would establish China as a neo-colonial power making Pakistan as its “province”. “China’s over-capacity in cement, glass, steel and manpower is being poured in OBOR including Pakistan. CPEC has become the convenient way for China to deploy its excess manpower abroad. Is this what is called all-weather friendship or is it a means to mortgage tomorrow’s future. By exporting labourers and raw materials it is another convenient way for China to keep its air clean. This is sort of reverse colonisation as feared by African countries few years back. Pakistan’s benefit from CPEC is not yet clear except the fact that the country’s economy will further burdened with high-interest loans,” alleged the scholar. The rate of interest for Chinese funded projects under CPEC is as high as 8 per cent.
In a recent article in the ‘Central Asian Caucus Analyst’, Mushtaq A. Kaw, Head of the Department of History, Maulana Azad National Urdu University, Hyderabad, wrote, “The project faces several inextricable challenges and threats ahead of its completion in 2030…Pakistan is currently unable to repay the Chinese loan due to its steeply soaring trade deficit (US$ 28 billion by June 2017) and national and international debts (US$ 73 billion respectively in 2015). China will benefit more from the project than Pakistan, because China is lending Pakistan for construction but the works will be executed by its own companies and work force. Most of the lending is on commercial terms, including overhead charges on debt-service and loan-reinsurance. Even the lending involves charges of a debt-to-equity ratio of around 80:20, or in some cases 75:25. And in most cases, return on equity is guaranteed at either 17 or 20 percent.”
But it is not the scholars alone who have raised voices against economic and political implications of CPEC on Pakistan. Mehran Marri, Baloch representative to the EU, speaking at a seminar on OBOR in Brussels on May 5, referred to the first-hand experience of local Pakistani communities and the Baloch people, through where the CPEC was passing, and highlighted their suffering and repression at the hands of the Pak army. Marri alleged that as the CPEC experience clearly showed, China was not driven by any altruistic motives, and was not promoting OBOR to improve the lives of the local people.
Meanwhile, Delhi is monitoring every step of CPEC carefully as it not only passes through PoK and has strategic implications for India but due to the fact that the mega-project has the potential to create massive socio-economic instability within Pakistan impacting the neighbours.
Even noted international think-tanks echo Indian views. According to a report released by the Stockholm International Peace Research Institute – a Swedish-based think-tank – India’s opposition to CPEC reflects a concern over the internationalisation of the Kashmir dispute and the growing influence of China in the Indian Ocean.