China Pakistan Economic Corridor (CPEC) will help Pakistan break free from debt burden through wealth creation.
Some western media and think tanks have labeled China-Pakistan Economic Corridor (CPEC) a “debt trap” for Pakistan, but the situation on the ground shows that it is allowing the country to break free from the shackles of Western debts through wealth creation.
Pakistan lies at the heart of China’s Belt and Road Initiative (BRI). China has committed to funding 80 percent of CPEC worth USD62 billion. However, despite such generosity and ambition, the Western media has been making propaganda regarding this project.
The mega project is being hailed as a game-changer for Pakistan. However, since 2018, the growth of CPEC has been hampered by the economic crisis.
International donors have expressed concerns that CPEC financing has resulted in massive purchases of Chinese technology and supplies, increasing Pakistan’s debt load in 2018.
This shows that the “debt trap” rhetoric is misguided and a failed attempt to downplay the benefits of CPEC to Pakistan.
CPEC can alleviate Pakistan’s financial troubles by providing a firm foundation for the industry by meeting the country’s energy needs and establishing an effective transportation infrastructure.
China’s vote of confidence in Pakistan’s economy increases as it remains the greatest donor of net foreign direct investment (FDI) in Pakistan when compared to other countries, according to recent research by Gwadar Pro.
Long-term concessional government borrowing from China is used to fund CPEC infrastructure and transportation projects. The FDI and commercial borrowing from Chinese financial institutions are used in CPEC energy projects, which are either primarily foreign-owned joint ventures or Chinese investors.
