China-Pakistan CPEC project has long road ahead as Beijing puts hold on projects

Peshawar, Nov 17: The COVID-19 pandemic, ongoing political unrest and foreign debt limits have resulted in a slowing of Chinese investments in Pakistan as Beijing has put a hold on projects that are part of the USD 62 billion China-Pakistan Economic Corridor (CPEC).

Pakistan Prime Minister Imran Khan, whose government is criticised for being under military control, is also facing flak in his country for not prioritising and expediting big-ticket Chinese infrastructure investments, Asia Times reported. In 2018, Khan had put on hold several CPEC projects suspecting corruption by the previous government. However, two years later, several of his Cabinet members were named in big corruption scandals involving the country's power sector. About one-third of Pakistan's power companies are involved in Chinese projects under the CPEC.

The 278-page inquiry report, compiled by the Securities and Exchange Commission of Pakistan (SECP) and presented to Khan in April, unearthed alleged irregularities worth over USD 1.8 billion in subsidies given to 16 independent power producers (IPPs) including those belonging to Khan's advisors Razak Dawood and Nadeem Baber, Asia Times said.

The SCEP had also investigated the profits earned by the Chinese power companies. The report revealed that Huang Shandong Ruyi Pakistan Ltd (HSR) and Port Qasim Electric Power Co Ltd (PQEPCL) were together overpaid by 483.6 billion rupees (USD 3 billion).

The Pakistan Democratic Movement (PDM), an alliance of 11 opposition parties, has demanded the Imran Khan-led government to speed up the Chinese-funded projects, especially the motorway and railway modernisation plans that have had almost no progress in the last five months.

The PDM has also demanded the removal of CPEC Authority's chairman, retired Lieutenant General Asim Saleem Bajwa, until he comes clear of his personal and his family business assets in the US.

Recently, a local media had exposed Bajwa's several offshore businesses, including more than 100 companies and franchises in the US, UAE and Canada in which his family are involved.

In 2019, the Prime Minister had promulgated an ordinance to establish a CPEC Authority (CPECA) ahead of his visit to China and appointed a former lieutenant general as its chairperson. Earlier, the Planning and Development Ministry used to oversee the CPEC projects.

Planning Ministry sources told Asia Times that CPECA was forced upon the government by China, which wanted the army to be directly involved in the CPEC portfolio as Beijing was reportedly irked with Khan's slow movement on the wider scheme.