Tuesday, March 2, 2021

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China Will Not Re-Negotiate CPEC Project With Pakistan, Affirms Beijing

Is the much-hyped CPEC project under severe scrutiny in Pakistan? Resistance has strengthened under the new government of Prime Minister Imran Khan, who has voiced concern about rising debt levels and says the country must wean itself off international loans which includes the Chinese funded CPEC project.

“We are seeing how to develop a model so the government of Pakistan wouldn’t have all the risk,” Khusro Bakhtyar, a minister in Pakistan’s planning ministry, told reporters recently.

Earlier, new governments in Sri Lanka, Malaysia and Maldives raised concern about the stifling Chinese loans and have put the project under scrutiny. Pakistan’s new government also wanted to review all CPEC contracts. Officials say there are concerns the deals were poorly negotiated, too expensive or overly favouring China. However, to Islamabad’s agony, Beijing is only willing to review projects that have not yet started and has denied renegotiating the projects which have commenced.

Pakistani officials say they remain committed to Chinese investment but want to push harder on price and affordability while re-orientating the China-Pakistan Economic Corridor (CPEC) – for which Beijing has pledged about $60 billion in infrastructure funds – to focus on projects that deliver social development in line with Khan’s election platform.

Growing differences with the US have also weakened Islamabad’s negotiating abilities, as has a current account crisis likely to lead to a bailout by the International Monetary Fund, which may require spending cuts. “We have reservations, but no other country is investing in Pakistan. What can we do?” a Pakistani minister told Reuters.

More News at EurAsian Times

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