The 14th Joint Cooperation Committee (JCC) meeting of the China-Pakistan Economic Corridor (CPEC) recently concluded in Beijing but failed to resolve key issues concerning safety, security and capacity repayments to Chinese Independent Power Producers (IPPs).
Moreover, desired pledges on ML-1 and other mega projects have not yet materialized. Despite this, the meeting has been termed a historic milestone as the partnership between Pakistan and China entered CPEC Phase-II. However, it should rather serve as a wake-up call for the country’s policymakers, especially the Planning Ministry, which often makes lofty claims yet delivers little.
Undoubtedly, qualitative industrialization, technological advancement, sustainability and shared prosperity could transform CPEC Phase 2.0 in Pakistan, but key parameters such as foreign direct investment, modernization, digitalization, policy contingency, political stability, zero corruption and human development remain missing. Furthermore, the development of five to six pending Special Economic Zones has not been properly addressed, posing a major obstacle to attracting Chinese investors.
Rapidly changing socio-economic, geopolitical and geostrategic trends indicate a possible policy shift from Islamabad. It will be a challenging task for the Planning Ministry to attract more Chinese private companies to invest in Pakistan without first resolving these pressing issues. Mere projection of convergence will not be sufficient to strengthen the China-Pakistan community with a shared future, as signed in September 2025. The proposed plan outlines a comprehensive agenda covering industrial cooperation, Special Economic Zones, agricultural modernization, maritime development, mining and flagship connectivity projects such as the ML-1 Railway, Karakoram Highway (KKH) realignment and Gwadar development. However, a holistic approach supported by a diversified mechanism is urgently needed to advance CPEC Phase 2.0.
According to reliable sources, the issue of Chinese IPPs could not be resolved as Islamabad sought to extend the repayment period. On partial financing of the ML-1, China requested a firm commitment from Islamabad before finalizing the agreement, especially in the context of the ongoing IMF program, reflecting a widening trust deficit between both sides. Highlighting a forward-looking agenda, the Minister noted that CPEC Phase-II will be driven by five corridors—growth, innovation, green development, livelihood and regional connectivity. These will be aligned with Pakistan’s URAAN 5Es framework of Exports, E-Pakistan, Energy & Environment and Equity & Empowerment. However, more concrete policies are required to make URAAN 5Es a functional model for a prosperous Pakistan.
Minister Ahsan Iqbal emphasized the urgency of implementing the ML-1 and KKH realignment, noting their strategic importance for uninterrupted connectivity between Pakistan and China. He asserted that early execution of these projects would yield far-reaching economic dividends for the entire region. His proposal to hold JCC meetings every six months and convene Joint Working Groups quarterly during the first three years of Phase-II reflects existing delays and deadlocks in effectively advancing CPEC Phase 2.0. Hence, institutional strengthening, resolution of pending issues, provision of missing economic parameters and enhanced protection for Chinese personnel are essential for the effective implementation of CPEC Phase 2.0.
Acknowledging the geopolitical challenges and propaganda by anti-CPEC forces, the minister urged swift agreement on the JCC minutes to send a strong signal of unity and decisiveness. He announced that Pakistan and China had agreed to publish an updated CPEC long-term plan within 90 days, reflecting the convergence of Pakistan’s 5Es with the five corridors of CPEC 2.0. Hopefully, ministerial reassurance to Chinese partners will affirm Pakistan’s unwavering commitment to the safety and security of all CPEC projects and Chinese nationals working in Pakistan. He described CPEC not only as a development initiative but also as a symbol of the iron-clad friendship between Pakistan and China, underpinned by trust, stability and mutual respect.
He also proposed that the 15th JCC meeting be held in May 2026 in Islamabad, coinciding with the 75th anniversary of diplomatic relations between Pakistan and China, further cementing the historic ties between the two nations. It is encouraging that the 14th JCC reaffirmed that CPEC Phase-II will be the driving engine of future partnership and growth, aligning its five corridors—growth, innovation, green development, livelihood and regional connectivity—with Pakistan’s 5Es framework of Exports, E-Pakistan, Energy & Environment and Equity & Empowerment. However, serious and sincere efforts are needed from top to bottom to attract more Chinese investment and ensure timely completion of CPEC projects.
In his closing remarks, Federal Minister for Planning, Development and Special Initiatives, Ahsan Iqbal, highlighted the shared vision, renewed determination and ambitious roadmap that will shape the next stage of this transformative initiative. Hence, a comprehensive overhaul is urgently required to pursue these highly projected objectives in the days to come. On its part, Vice Chairman of the National Development and Reform Commission (NDRC) Zhou Haibing underscored that the 14th JCC was not merely a review of past progress but a reaffirmation of the collective resolve to deepen cooperation and build a future of shared prosperity.
To conclude, it will be a tough test for Pakistan’s Planning Commission and Ministry to change the prevailing mindset of the Chinese private sector toward investing in Pakistan without addressing the IPP repayment, safety and security issues that continue to undermine economic prospects. The government of Pakistan has informed the IMF that it will not pay Rs220 billion to Chinese IPPs as interest on delayed payments for purchased electricity and will instead seek a waiver from Beijing, which unfortunately has not yet been secured, causing further delays in CPEC Phase 2.0 implementation.
The proposed minutes of the recent JCC meeting state that “the two sides agreed to jointly maintain the stability of the electricity price policy for energy projects under CPEC, resolve disputes through friendly consultation and neither side shall seek to change the status quo through unilateral actions.” Since 2017, Pakistan has paid Rs5.1 trillion to 18 Chinese power plants, covering 92.3% of billed amounts, including interest. Pakistani authorities estimate the actual remaining energy cost at Rs250 billion, with the rest comprising late payment surcharges.
