CPEC’s protection & qualitative expansion

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Dr Mehmood Ul Hassan Khan

THE China-Pakistan Economic Corridor (CPEC) has the mutual political will and trust of both the countries. It also enjoys economic viability, planning relevancy and futuristic cashable value for both the countries. Right from the beginning it has been standing for development, diplomacy and dialogue due to which despite regional “unsound” jealousy, enmity and global “arm-twisting” approach and “mantra” to “stay-away” from China and “slow-down” the caravans of the CPEC is on the way of further strengthening of bilateral relations in terms of high volumes of trade and commerce, inflows of FDIs, energy generation, national and regional connectivity, poverty reduction, job generation and last but not the least, massive industrialization and diversification of economy etc.

Most recently, the government of Pakistan has introduced ‘The China-Pakistan Economic Corridor Authority Bill, 2020’ in National Assembly which has great significance. It hopes that it would speed up various CPEC projects in the country. It provides essential “legal” and “administrative” protection to its authorities to act in good faith in accordance with law to “gear-up” diversified but integrated activities of CPEC projects in the country. It removes all rumours against the CPECA. It upholds that “no suit, prosecution or other legal proceeding shall file/report against the CPECA, the chairperson, member, executive director operations, executive director research, employees, officers, experts, consultants or advisors of the authority, in respect of anything done or purported to be done in good faith, under the provisions of this Act or the rules and regulations. It is indeed a “valuation-addition” in the overall performance, productivity and protection of the Pakistan Economic Corridor Authority (PECA).

It also says that “the PECA would be responsible for planning, facilitating, coordination, monitoring and evaluating to ensure implementation of all activates related to the CPEC, ensuring inter-provincial and inter-ministerial coordination, organizing and coordinating meetings and joint cooperation committee and joint working groups, conducting sectoral research for informed decision-making and a long-term planning; monitoring and evaluation and to ensure implementation besides narrative building and communication of CPEC and other related activities from time to time. It hopes that after this legislation CPEC projects and CPECA would be in more “comfort zone” to establish economic free zones, energy production and “operationalization” and “channelization” of its projects in the country. Legal protection will definitely further strengthen PECA strategic orientation, professional capabilities, planning abilities and above all supervisory role in the implementation and execution of the CPEC projects.

Most recently, the CPEC Joint Working Group on Transport Infrastructure held its eighth meeting through a video link at the Ministry of Communications during which it was decided to propose inclusion of Chitral to Chakdara Highway (N-45) that links Swat Motorway as a part of the western route of China Pakistan Economic Corridor. All main stakeholders and officials of Foreign Office, Ministry of Railways, CPEC Authority, Sindh Government, Ministry of Maritime Affairs, Balochistan Government, Civil Aviation Authority, and the Khyber-Pakhtunkhwa Government attended the said meeting. Ultimately, the conference approved the motorway construction plan stretching from Peshawar to D.I. Khan (320KM), Swat Expressway from Chakdara to Fatehpur Phase-II (182KM) and Dir Expressway (30KM).

Secretary Communications briefed about the CPEC’s common vision that marked the friendship of two great countries. He suggested the inclusion of Chitral to Chakdara Highway (N-45) linking Swat Motorway (Chakdara to Karnal Sher Khan Interchange on Motorway M-1) as part of the western route of CPEC which would further strengthen communication “connectivity” and also boost local economies in the days to come. On its part, the Chinese Vice Minister of Transport Dai Dongchang, while addressing the meeting termed Pakistan and China’s relationship higher than mountains and improving day by day. He labelled mutual cooperation between the two nations in the construction sector as progressive, productive and expanded which would result in an improved development rate in Pakistan.

He termed the said video link meeting result-oriented and purposeful before appreciating Pakistan’s efforts and commitments on CPEC projects. Additionally, he also announced that China intends to broaden the scope of CPEC by including further projects. Chairman National Highway Authority stated that the Sukkur-Multan Motorway and Havelian-Thakot Motorway plans have been successfully concluded in a record time frame with high-quality construction. He said that the Thakot-Raikot sector of Karakoram Highway that extends to over 136 KM is a vital link and will play a significant part in the country’s development. He emphasized the requirement for a 210 km up-gradation of the D.I.Khan-Zhob Section on a priority basis.

Pakistan is now rigorously planning to take benefits of CPEC projects. China Three Gorges South Asia Investment Limited (CSAIL) is seriously planning to list its subsidiary, renewable energy company Three Gorges First (TGF) Wind Farm Private (Pvt.) Limited on the Pakistan Stock Exchange (PSX) by the second quarter of 2021. It hopes that the listing will have a great impact on the economy as it will set viable option and befitting propositions for future listings. Moreover, it will boost the investors’ confidence and bring stability to the market. It will further attract more and more Foreign Portfolio Investments (FPIs) in the country. It would be the first listing by a Chinese Company on the PSX.

The CSAIL is an investment holding company formed by state-owned China Three Gorges Corporation (CTG) the largest Chinese clean energy group and the world’s largest hydropower group in terms of owned and equity-based installed capacity worldwide and CTG’s subsidiary China Three Gorges International Corporation (CTGI). CSAIL had been formed to invest in clean energy projects in the South Asian region with a current focus on Pakistan. The CSAIL has six standalone energy projects in Pakistan, four under the China-Pakistan Economic Corridor (CPEC) and two independent [non-CPEC]. The CPEC projects of the company include two large hydropower projects, the 1,100MW Kohala Hydropower Project and the 720MW Karot Hydropower Project, both located on Jhelum River, and two wind power projects that include 100MW Three Gorges Second and Third Wind Power Projects. The listing will convey a message that China is willing to share benefits of the projects with the people of the countries it is investing in.

Therefore, the listing is not going to be an IPO to raise funds from the public, but an offer-for-sale (OFS) to make the general public [of Pakistan] shareholders in the project and enable them to earn stable returns. Being a prominent regional expert of CPEC & BRI, I personally estimate that listing of Chinese companies’ shares would promote sentiments of positivity in the markets which would further strengthen infrastructural development in the country. It will increase the breadth and options of the stock market. It will strengthen investor confidence.

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