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Experts propose setting up CPEC Advisory Council

Experts speaking at CPEC Summit & Expo 2018 organized by Ministry of Planning Development & Reform, Pakistan has called for setting up a CPEC Advisory Council to clarify vision and policies and advice on how Pakistan can take maximum benefits from the project.
Former Governor State Bank of Pakistan, Dr Ishrat Hussain while chairing the first session of the summit said that largest component of CPEC investment i.e. 35 bn USD has been reserved for energy projects focused on fuel substitution to coal, LNG, solar and wind power. “Power generation capacity will be doubled over the years while transmission capacity to increase from Matiari to Lahore and Matiari to Faisalabad,” he added.
Enhancement in energy generation is good for exports which have been 36 billion USD only as energy shortage is a major impediment to exports.
However, circular debt issue should be resolved on priority as it is touching Rs. 600 billion and is directly proportional to power generation and will give headaches when power generation increases if not countered by improving the performance of distribution companies to increase recovery.
He said that not only local but Chinese investors are also frustrated due to cumbersome approval processes and lack of departmental coordination which are not working in unison hence delaying the projects. The government must remove obstacles and simplify the processes not only to attract investments but to keep them focused on implementing their plans than to get mere paperwork done.
Moreover, he said that many local companies are worried that Chinese companies are being given preference over their Pakistani counterparts for industrial zones. “Their concerns should be addressed and level playing field to the Chinese and Pakistani investor should be provided,” he added.
Shaukat Tarin, Chairman National Council of Economic Advisers said that Chinese universities should be encouraged to open campuses in Special Economic Zones that will help us train our youth on latest curriculum and technologies. “Pakistan must benefit from Chinese expertise in technological advancements like Artificial Intelligence, Robotics, and Big Data to ensure we do not fall behind as these are the technologies of future,” he added.
A Chinese bank in Gwadar should be opened to facilitate not only the Chinese companies operating in Pakistan but local companies also which are undertaking business activities in China.
Companies in Pakistan have a longstanding concern about infrastructure and security needed for industries to operate and thrive and the CPEC planners should address that.
Dr Abdul Hafeez Sheikh, Former Federal Minister of Finance said that CPEC should be considered as a transformational exercise, not just a mere transaction and should ensure strengthened Pak-China relations which are possible only if it is implemented in the right way.
However, he warned that CPEC should not be taken as a substitute to sound economic management which is imperative for Pakistan. Moreover, Pakistan should not be entirely dependent on China if the transformation is to happen, and use CPEC to lure in other countries also as hundreds of billions of US dollars are available beside the $50 billion CPEC investments and the opportunities should be tapped strategically. China’s per capita income now has increased to $9000 from less than $300 about 40 years ago whereas Pakistan has increased its per capita income only by 4 times from $400 to $1600 currently.
Average annual GDP growth rate of China over last 40 years is almost 10 percent which has not been achieved by any country whereas Pakistan’s in only 5 percent. “This was possible because China focused on leadership and team building, while also changing their policies to trade with every country,” he added.
On the other hand, Pakistan was mostly disturbed by war and conflicts in the region like Afghan war and the continuing war on terror which has hampered the country’s growth. Moreover, Pakistan does not like a business with anybody and hardly any country likes to partner Pakistan. “Changes in government over the years have also led to change in policies which have hurt the country and investors’ confidence,” said Hafeez.
Samaira Nazir Siddiqui, Secretary – Board of Investment while addressing some of the myths regarding CPEC said that there are no preferential or additional benefits being provided to Chinese investors and not only investors from Pakistan and China but all over the world have same policies applicable to them and enjoy same incentives. She said that nine sites have been selected as SEZ and 3 of them are near completion. “It takes almost a year to complete feasibility of SEZ but we did it in only 3 to 4 months to increase the pace of the projects,” she added.