Hassan Daud Butt
As the year 2019 draws close to its last sunset, the coming year provides several reasons to work for a sustainable, stable and inclusive growth. In a country where 22% of Pakistanis live below poverty line which includes 31% in rural areas and 13% in urban areas and the unemployment rate is at approximately 3.04 percent, the need to remain on the road of continuous development and innovation is immense.
In last few years the world witnessed an economic slowdown, it also saw the resurgence of Asia with more inter linkages developing, facilitating people-to-people interaction and providing opportunity of economic uplift to less developed countries like Pakistan. At this critical juncture, BRI offered a beacon of hope for the participating state linking regions through economic belts with China remaining the factory of the world. Today most nations are trying to connect their economies with the Chinese market and enterprises looking at the needs of the Chinese consumers. This is where Pakistan stands its best chance of industrial and agriculture sector growth as the new FTA with China offers 313 tariff lines of textiles and garments, seafood, meat and other animal products, prepared foods, leather, chemicals, plastics, oil seeds, footwear as well as engineering goods including tractors, auto parts, home appliances, machineries etc.
In 2019 while at home, the commentary remained on CPEC slowdown or otherwise, the government remained focused on expanding the scope of CPEC so that it becomes a “Gateway of Prosperity”. Several projects and new development Plans i.e of Oil & Gas Sector, Socioeconomic development, agriculture sectors were initiated as well as road projects on western and eastern corridor, firming up of scope of the ML-1 Project, commencement of work at Gwadar International Airport, approval of Gwadar master plan and establishment of CPEC business forum are some of the achievements of the government that helped cement the cooperation under the broader framework of BRI, making CPEC icon of the great initiative. So far fifteen projects in energy sector have been firmed up, nine of the projects are being implemented through Private Power Infrastructure Board (PPIB) including the 660 MW Engro Thar coal project connected to national grid and six by Alternative Energy Development Board (AEDB). Last year 27 projects in Socio economic development of low gestation and high impact projects were also included during the visit of the PM to China ushering a new era of cooperation in agriculture, education, Medical treatment, Poverty alleviation, Water supply, Vocational training.
Entering 2020, the government is gearing up to lift less developed areas of Pakistan and promising greater regional integration. However the biggest dividend will be through the industrial cooperation and development of Gwadar Smart Port city creating opportunities for jobs and growth reducing risks and promoting complementary policies can help share the gains including policies to strengthen trade, logistics and business cooperation and improve business-to-business (B2B) links. This can happen if like China we work on our industrial structure, improve transportation and infrastructure. Improve EoDB system and find new financing models.
Pakistan needs foreign capital and the constant growth of private companies and the only short term method of achieving this is through the Special Economic Zone (SEZ) where concerted effort would be required in 2020 to start the development of the 4 prioritized zones in CPEC and address issues related to land, market access, customs supervision, taxation, HR capacity and a series of sensitive issues and perhaps change existing mindset of business community regarding FDI and Chinese investments. All this has to be incremental as in the words of great Deng Xiaoping “wade across the river by feeling for the stones”. The newly established CPEC authority has much to prove in the coming year besides establishing itself as a one stop shop for the CPEC projects to tackle problems in a realistic manner and help the government to make best use of the environment and act actively and efficiently towards realizing it’s economic and development agenda quickly and soundly. The Authority also needs to proactively help avoid administrative procedure and inefficiency, so that necessary services would be guaranteed for local and foreign enterprises’ investing in second phase of CPEC.
The CPEC Authority may implement it ToRs by firstly, studying the progress in last 5 years and remain empirical in carrying out any change in the existing methodology. This can only happen if we start with understanding of the ground realties and take progressive steps and understand the Chinese model of overseas investment and management of enterprises.
Through these steps FDI would be attracted in SEZs and other initiatives, yet we also need to address the gap in technology as the world is witnessing the growth of knowledge economy through continuous progress based on innovation. Technically skilled HR and the enabling IT infrastructure is now a prerequisite to create the pull factor for which EoDB for establishing Knowledge economy and Prepare and provide competent, skilled human resource reform academic programs of engineering and technology and develop intellectual corridor to support CPEC.
As per Chinese scholars, China identified 8 characteristics for its economic growth, as “four supers “and “four special. “The “four super “refer to its demographics; land size, history and the depth of it culture. The “four specials “including its languages, its politics, society, and its economy. Pakistan on its part has similar natural endowments which we need to leverage to fact track economic growth. However time is less and we need to set specific targets in CPEC for 2020 like the completion of work on the optical fiber connectivity from Khunjrab till Gwader, commence development work on PSEZs, Gwader Smart port city and ML-1, setting up of vocational centers and agriculture demonstration zones across Pakistan, yearlong opening of KKH , establishing the Pak China business forum to promote B 2 B interaction and ensuring seamless security etc so that CPEC remains the stimulus to our economy and delivers the results it had promised.
About the writer: Mr. Hassan Daud is a Projects’ Management specialist and is a faculty member of Projects Management Dept. at various institutes/universities. He has also served as diplomat in China and Vietnam.
