Three years since it formally began, the China-Pakistan Economic Corridor (CPEC) remains front and center of economic discourse in Pakistan. This multibillion-dollar stock of infrastructure projects has weathered controversies ranging from route alignment and debt buildup. Several early-harvest projects in energy and transport sectors have been completed; for that, credit is due to both governments.
But the next CPEC wave is critical. There are projects relating to connectivity (building Gwadar port and city infrastructure, upgrading Railways, revamping highways in the north and building motorways down south) and industrialization (creation of nine Special Economic Zones across the country).
Given the political uncertainty that has engulfed the country for more than a year now, is Pakistan’s political class and administrative machinery up to the task?
It certainly helps that China is a great unifier within Pakistan; the longtime friend doesn’t divide public opinion here the way America does. Therefore, it can be argued that CPEC will carry on with full force under whosoever forms the next government in Islamabad.
Political consensus that CPEC matters greatly to Pakistan’s economic future is a fact of life in Pakistan. No worries, then; unless the country is hit hard by another season of post-election protests ala 2014, when CPEC commencement was stalled due to dharnas.
Still, a key question remains: will the new government do better to catch up with the Chinese pace? The local benchmark – also known as ‘Punjab speed’ – has previously delivered the PML-N electoral victories. In the CPEC era, though, even this gallop has met occasional rumblings of not being fast enough.
That puts a question mark over the PTI – the main challenger to the throne, a party not exactly known for fast-paced infrastructure development – delivering where even the Sharifs couldn’t fully impress friends in China. On the Chinese side, it remains to be seen how the reported shifting of CPEC mandate from the Chinese Ministry of Commerce to the China-Aid will impact the development pace going forward.
Even if all goes well, there is also the matter of Pakistan facing multilateral squeeze at the hands of its erstwhile friends in the West.
At the FATF Paris plenary in February, Pakistan was placed on the grey-list of non-conforming countries vis-à-vis AML/CFT compliance.
It was also threatened inclusion into the black-list – which has Iran and North Korea on it – come June if a joint action plan was not agreed with the global watchdog.
The Western pressure and other regional concerns were such that even China found it difficult to come to the aid of this country. A friend in need is a friend indeed; but it is also not nice putting one’s friend in a state of bother too many times.
If Pakistan is further isolated on multilateral fora, it cannot augur well for CPEC. It may grow Pakistan’s over reliance on China, but it will make China uncomfortable. Given the scale of its current and future investments in this country, China would want Pakistan to remain part of the global financial system, play by the international rules, and seize any opening for regional integration. Unlike Uncle Sam, China isn’t known for delivering public lectures on course correction. The next government should take the hint.
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