CPEC is dead, is it? Dr Shabir Choudhry.

 

CPEC is dead, is it?

Dr Shabir Choudhry 27 January 2022

Pakistani political, military elite and businessmen have stopped investing in the CPEC, which clearly indicates that these projects are not economically viable, claims Farooq Trimizi. His contention is if these projects were economically beneficial then why is it that the Pakistanis with money are investing elsewhere and not in Pakistan.

He further wrote ‘the more Pakistanis learn about the true costs of the China Pakistan Economic Corridor (CPEC), the less inclined they are to want to participate any further than we already have. 1

Perhaps this was an overstatement. The CPEC was not dead. Those who appointed Imran Khan as the Prime Minister of Pakistan wanted him to accomplish certain tasks, which included sabotage of the CPEC. Within one year of his appointment, the economy of Pakistan was minus, and Pakistan was back to the IMF with a begging bowl. The CPEC, which was supposed to be a ‘game changer’ for Pakistan was put on the back burner, and later it was shifted to intensive care.

After observing these changes taking place in Pakistan, the writer, Farooq Trimizi asserted that the CPEC was dead. It was not. China with its military and economic power will not let the CPEC die, as it is fundamental to the success of the Belt and Road Initiative (BRI).

It must be noted that the BRI is very carefully planned and ruthlessly executed by China to achieve its ambition of becoming a great military and economic power which enables them to call economic, military and strategic shots in certain areas of the world. The ruling elite in Beijing strongly believes that they deserve to be acknowledged as a Great Power status.

After flirting with China for some years Pakistan’s top ruling elite has rediscovered that China could not replace America. China is a good neighbour with some common interests with Islamabad, and that relationship should continue, but the ruling elite has many more things in common with America and the West.

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In other words, it will be foolish to put all eggs in Beijing’s basket, which has different culture, aspirations and future ambitions, as that may not be in consonant with the lifestyle, culture and agenda of the ruling elite of Pakistan.

It is true that friends and foes change with time. When national interests clash between friends, then friends can become enemies. Historically Pakistan has changed pay masters and friends. Some Pakistani officials claim that among those countries which want to invest in the CPEC projects include Saudi Arabia and UAE. They don’t tell people how much Saudi Arabia and UAE have invested in India, and how close they have become over the past year.

These ‘genius’ people think Saudi Arabia and UAE want to invest because of two reasons: “First it aims to help Pakistan to stabilize its economy. Second purpose is to have an upper hand in the geo-political chessboard particularly against Iran by investing and giving bailout packages to Pakistan.” 2

Nong Rong, Beijing’s envoy to Islamabad had a meeting with General Bajwa, where both discussed CPEC, bilateral relations and Imran Khan’s three days visit to China 3 February to 5 February. Imran Khan shall participate in the opening ceremony of the Winter Olympics scheduled to take place in China.

Apart from that, Imran Khan will endeavour to iron out obstacles between China and Pakistan, especially on the issue of China Pakistan Economic Corridor. There are serious issues like security of the Chinese employees working in Pakistan, pace of many projects, which are not functioning and more loans.

Apart from that, some Pakistani analysts think during the visit Imran Khan will venture to persuade the hosts that the Chinese interests will also be safe if Imran Khan remains as a Prime Minister. In addition, he will try to persuade them that there was no need to bring back ‘convicted’ Nawaz Sharif.

People of Pakistan still remember what he did and said when he was in opposition to damage the interests of Pakistan. He did not hesitate to occupy state properties and openly encouraged a civil war, issued warnings to law enforcement agencies, and even requested other countries not to help Pakistan. In other words, the man

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is spineless, unpatriotic, power hungry, and can share a bed with Satan to stay in power.

Critics claim their sources in the Foreign Office of Pakistan confirm that a similar plea was made to Washington. The American leadership did not take the bait, as they were not in favour of Imran Khan and the current hybrid regime. After this fiasco, Imran Khan and his colleagues thought why not seek help from China.

Now, Imran Khan and his team are propagating that the CPEC is beneficial to Pakistan, and that they will start the CPEC with new determination. Also, they will restart the ‘one window’ service for all the CPEC operations, which was established by Nawaz Sharif. In view of the Pakistani analysts, Beijing is not inclined to meet Imran Khan or discuss anything related to the CPEC. The best the Chinese leadership can do is to ‘honour Pakistan’ by having a photo session with Imran Khan. 3

It must be pointed out that two major attacks last year angered the Chinese, one was the attack on a bus carrying the Chinese workers from the Dasu hydropower plant in July 2021. The other incident was an attack on a hotel in Quetta in April, where the Chinese envoy was also staying during his visit to Balochistan.

China was furious that their workers, despite many promises of fool proof security, were not safe in Pakistan. They demanded better security arrangements and compensation for the killed and injured employees. Pakistan, in principle, has agreed to pay compensation for the dead and injured employees, but no compensation plan is finalised yet.

In a meeting with Nong Rong, Beijing’s envoy, General Bajwa reiterated Pakistan’s strong commitment to provide full security to the Chinese workers, and ensure that there will be a ‘safe and secure environment’ for employees of all CPEC projects. 4

Pakistani officials and their supporters, generally castigate all criticism related to the CPEC by saying it is an Indian propaganda or a discourse of enemies of Pakistan. At times, the Chinese officials also call criticism of CPEC as ‘fake news’; or propaganda of those who don’t want Pakistan and China to do well.

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On 20 January 2022, the Chinese Foreign Ministry Spokesperson Zhao Lijian, in a reply to a question about slowing down of the CPEC projects in Pakistan, and because of disagreements, and non-approval of new loans and new projects asserted:

‘This is pure fake news. ‘Noting that under the CPEC framework, new agricultural working groups, information technology working groups and scientific and technological working groups have been established’. 5

In a reply to another question, Zhao Lijian confirmed that there were issues on a loan of Rs 230 billion for the Karachi–Peshawar railway line (ML-1). He said:

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‘It is a huge investment project and relevant departments on both sides are negotiating about it. 6 Some Pakistani analysts observe that the signals emerging from Pakistan’s establishment seems to be that ‘Pakistan’s economic and political orientation’ should not pivot around China, rather ‘Pakistan should retain its historical role as the country that is able to balance its relationship with both China and the United

States’. 7 CPEC and East India Company

Imperialism can fall into three categories: • Colonies,

• Protectorates, and

• Spheres of influence.

  Whether it is Imperialism, New Imperialism or Neo Imperialism, they are all bad for the territory that is confronting them. With time imperialism changed its characteristics. Neo Imperialism appears to be friendly, pro people, and does not believe in physical presence. Imperialism or occupation, whether imposed by gun boat diplomacy or by debt trap diplomacy, is bad, as it is designed to exploit resources and empower themselves.

One definition of Neo colonialism is as follows:

‘Neo-colonialism is the practice of using economic imperialism, Globalization, cultural imperialism and conditional aid to influence a developing country instead of the previous colonial methods of direct military control or indirect political control’.

In other words, neo imperialism is a system where the dominant power does not apply a direct rule. Call it influence or control, it is always indirect, and pressure or control is exercised by influencing the political leaders of the country. The dominant country provides funds to Third World countries for development, defence and economic assistance; and with time the poor countries are entrapped in a web of debt, and lose their sovereignty.

This indirect control is strengthened by powerful and experienced institutions like transnational corporations and global and multilateral institutions. Apart from that, other economic and financial instructions formulate such trade policies in which these poor countries find very little space to manoeuvre. Also, some powerful countries exercise their control through the Financial Action Task Force, the International Monetary Fund and the World Bank.

In view of some Pakistani analysts, American neo-colonialism is better than the Chinese, because America is willing to share some of its wealth with and influence with allies and ‘colonised’ countries. China, on the other hand:

‘Wants to create a global system where wealth and power flow in the direction of China as a means of strengthening it relative to its main rival (the United States), even if that means weakening its allies in the process. 8

Many writers compare the CPEC with East India Company, which came to India for trading purposes. What the East India Company did to India and Indians after they got some foothold in India is a long and tragic story. Some people call the CPEC, East China Company, as they feel their aim is similar to that of the East India Company.

Many Pakistanis are concerned about hidden motives of China. They think the China-Pakistan Economic Corridor (CPEC) is just another East India Company (EIC); and China wants to indirectly control and colonize Pakistan. Supporters of this

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argument cite threats of the debt trap, surveillance, security grid, and Chinese domination of local markets to convince others of China’s intentions.

Colonisation of the past centuries is a thing of the past. In the third decade of the 21st century no power in the world has the resources and potential to invade another country and maintain that control, like the colonial powers did in 18th and 19th Centuries.

Throughout human history we note that tribes, countries and empires invade territories for economic prosperity, glory, power and influence. As noted above, neo-colonialism does not want direct control or occupation. They want indirect control and influence to use poor countries to advance their agenda.

When the East India Company came here their intention was not to occupy any territory. With time, they saw an opportunity to occupy and plunder; and their intention and strategy changed, and they occupied the trading company.

With our colonial history and subjugation in mind, people are rightly apprehensive of China, and their future designs. However, it must be noted that when the East India Company came to the Indian Sub-Continent, the share of this region in world trade was around 27%; and after their loot and plunder when they eventually left India in 1947, the trade share was down to 3%.

When East India Company came to this region, India was known as a ‘Golden Sparrow’; and East India Company came here to request some trading rights. When China and the CPEC came, Pakistan at that time was going around the world with a begging bowl, and there was terrorism, energy crises, bad governance, political and economic instability, and future of Pakistan looked very bleak.

China did not come to Pakistan with bags full of money because they loved Pakistan, or they were very generous and good human beings. They also want to do what the East India Company or the British did. Because the Chinese came here at a time when the old brand of colonialism was no longer practical; so, they came with a different strategy, different mechanism and a smile on their face.

Imperialism of Britain or East India Company was visible because of oppression and exploitative economic policies. However, ‘neo colonialism’ of China is not

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visible to ordinary people, and the ruling elite which has made millions of dollars from the CPEC projects; and hope to earn many more millions.

Many Pakistanis feel, despite the end of the British paramountcy or imperialism in the Indian Sub-Continent, they are still not free. Among them is Afzal Sayal who think the colonialism process started by the East India Company has not ended:

‘The departure of colonial powers was nothing but a deception and merely a change of masters. After seven decades of so-called freedom, the natives of this land are still being ruled in the same exploitative manner....One of the biggest tragedies that befell Pakistan right after its inception was that those who were supposed to guard the country on the borders, ruled the nation and seized the executive and policymaking’. 9

Like many others, this Pakistani writer, Afzal Sayal, complains about lack of transparency; and feels all important decisions are made by the Chinese leadership. He thinks the Pakistanis are ‘only the spectators of this project, and not equal stakeholders. Is it not enough to suggest that we are being enslaved’? 10

Afzal Sayal thinks if Pakistan has to make an economic progress, then they have to adopt a ‘Middle Eastern model’, whereby local citizens must be involved with industrial or business enterprises who must be 51% shareholder of the projects. Similarly, if a foreign firm wants to purchase a piece of land, they must find a local partner with 51% share. The company’s workforce must include 50% of the local people. If this is not done, then he asserts, ‘no one can stop Pakistan from becoming a new Palestine’. 11

If all the projects related to the CPEC were brilliant economic projects for Pakistan, which people were told will attract massive foreign direct investment because other countries would also like to benefit from them.

Sane people of Pakistan, need ask the government the following questions:

1. Where is that foreign direct investment?

2. How many jobs were created by this foreign direct investment?

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3. If these projects were to boost the economy of Pakistan, why after so many years current account balance is still negative, and getting worse.

4. Why is Pakistan still going around with a begging bowl to seek financial help to pay interest on the loans; and to run affairs of the government?

5. Why have millions of Pakistanis gone down the poverty line, and they are crying out for help?

The relationship between China and Pakistan, especially on the issue of CPEC is explained by a Pakistani writer, like this:

‘CPEC is not an investment into Pakistan, it is structured as a resource extraction exercise. Here is how it works: China announces that it has invested in a project in Pakistan worth, let’s say $1 billion. That $1 billion, however, is required to mostly be spent on Chinese equipment, and labour, a significant portion of which is to be imported from China as well, with very little by way of supplies coming from the local economy’.12

He explains it further by saying that the so-called $1 billion ‘investment’ does not get in the hands of those who manage the Pakistani economy. It does not come to the Pakistani coffers; hence, it does not help the balance of payment or the economy. Instead, that $1 billion stays within China because the Chinese government and state-owned companies pay directly to the Chinese companies for equipment and salaries for the Chinese employees.

This so-called investment will appear in trade statistics, for example, as $1 billion of‘import against which Pakistan will have to arrange foreign currency from somewhere. And it will show up as a liability on the balance sheets of whichever company or government entity is contracting with the Chinese government or state- owned company’. 13

Is it not interesting that a Chinese state-owned company gets $1billion in sales; and a Chinese bank lends $1billion on high-rate interest?

What does Pakistan get:

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• Investment of $0.

• Imports of $1 billion without importing anything, and of course this adds to

  the trade deficit.

• Either the government or a Pakistani company will be liable for $1 billion.

  ‘PM trying to appease China before visit’, writes Shafqat Ali, a Pakistani journalist in English daily, Nation. After throwing a spanner in the works of the CPEC and destroying the economy of Pakistan Prime Minister Imran Khan ‘ordered to complete the Special Economic Zones under the CPEC at the earliest and resolve any issues or hurdles.’ Also, he ‘directed the concerned authorities to resolve issues of the SEZs on a priority basis and measures for facilitating the investors should be implemented in the given timeframe’. 14

  Imran Khan is bending his back to please the Chinese before his visit on 3 February 2022. A member of Cabinet revealed that Imran Khan ‘will assure the Chinese leadership of expedited work on the CPEC projects and the safety of the Chinese people living in Pakistan. The recent meetings on CPEC and related projects have been part of the government’s efforts to appease China. We want them to be satisfied with the progress of the work on CPEC.” He has ordered removal of 37 regulations ‘to ensure one-window operation for foreign investors.” 15

  In my opinion, the CPEC is carefully designed by the experts of Beijing to camouflage the real game plan and agenda, and present it to Pakistan as an attractive deal. It reminds me that this ‘attractive deal’ is just like many Chinese products, which look attractive, but with time their charm and effectives is finished.

  We all know the Chinese have gained tremendous strategic, political and economic benefits from the projects related to the CPEC. However, some Pakistani individuals and organisations have also become millionaires. Wise people of Pakistan are questioning, as to what is there for the ordinary people? Has the CPEC helped the economy of Pakistan? Has it helped the balance of payment? Has it helped Pakistan to pay the loans?

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Email: Drshabirchoudhry@gmail.com

Reference:

1. https://medium.com/@farooqtirmizi/cpec-is-dead-somebody-tell-beijing- 9e18a891ff0b

2. https://www.globalvillagespace.com/china-thanks-coas-bajwa-for- providing-security-to-cpec-projects/

3. https://www.youtube.com/watch?v=vUWifwANpa0

4. Dawn20January202

5. https://www.globaltimes.cn/page/202201/1246547.shtml

6. Ibid

7. https://medium.com/@farooqtirmizi/cpec-is-dead-somebody-tell-beijing-

   9e18a891ff0b

8. https://medium.com/@farooqtirmizi/cpec-is-dead-somebody-tell-beijing-

   9e18a891ff0b

9. TheEastChinaCompany,DailyTimes,April6th2018.

10. Ibid
11. Ibid
12. https://medium.com/@farooqtirmizi/cpec-is-dead-somebody-tell-beijing-

9e18a891ff0b 13. Ibid

14. https://nation.com.pk/26-Jan-2022/pm-trying-to-appease-china-before- visit

15. Ibid

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The Pakistani ruling elite, in a military style operation is trying to resuscitate the CPEC, which was declared ‘dead’ by some Pakistanis; and which in my opinion, was in an intensive care unit. If the CPEC is revived, it will enrich and empower some more Pakistanis; and help China to advance their national, regional and international agenda. I hope, at the end of the day, there is something for the people of Gilgit Baltistan, people of Pakistan, and especially people of Balochistan who have been neglected

for so many decades. Writer is President Foreign Affairs Committee, United Kashmir People’s National Party, author of many books, political analyst and human rights activist.