Shakeel Ramay
Pakistan is blessed in many ways. It has immense natural resources including gas, oil, precious metals, highly productive agriculture sector and diverse geography and seasons. Though, sincere friends like China stands out among all these blessings. China is a friend which always stand by Pakistan and support country, no matter what is situation or what are circumstances. The most recent case is China-Pakistan Economic Corridor (CPEC). China started CPEC at a time when economy was in bad shape and no one was ready to invest in Pakistan.
CPEC is transformational project and has all the required tools to put economy and rapid growth and development. Despite, all these consecrations Pakistan is still struggling to come out of dangerous zone of economic turmoil. There can be many reasons, but the most prominent reasons are failure of country to capitalize on opportunities and hugging the all mis-adventure and embracing false propaganda. Fake news and conspiracy theories attract more attention than facts and figures. CPEC is latest victim on this front.
From the very first day Pakistan did not recognize the spectrum of opportunity and importance of the project. Controversies started to emerge even before the launch of the program. First of all, game of credit consumed much precious time. Everyone from the country wanted to be champion of the CPEC. Credit game ended with the start of route controversy. It further complicated the situation. Pakistan was fortunate that it ended these controversies amicably and CPEC started with the inauguration of different projects.
Nonetheless, after six years of inauguration CPEC is still struggling for the required attention and efforts. The red tape hurdles significantly impacted the speedy implementation of projects. Projects are not conceived or designed at required speed. Drum beating by previous government was highlight of the CPEC related projects. Corruption allegations and media propaganda also damaged the speed of CPEC. There were a breed of researchers and journalist which kept on blaming CPEC for all ills of country. The favorite allegations were debt trap, environment degradation and social equality etc. Most of the critics of the CPEC were doing critique for just the sake critique. Many of them were not even familiar with the governance and development model of China leave aside the other dimensions of China.
Notwithstanding of all these difficulties previous government was able to capitalize on opportunities in the field of infrastructure especially for transport and energy. Now substantial amount of electricity has been added to national grid and a good number of transport related projects have been completed. Infrastructure projects helped Pakistan to improve the business conditions and helped to attract the investment. PML-N government always take credit for it and they deserve the credit.
Though previous government could not think beyond the infrastructures’ projects. PML-N failed to understand the “transformational” aspect of CPEC. It lost the time in securing credit and ignored the most important dimensions of CPEC like Special Economic Zones (SEZs) policy, SEZs infrastructure, ease of doing business and better investment regime. Government could not comprehend that the real benefits of CPEC will come from second and third phases. For successful implementation of second and third phases revolutionary steps are needed to mend the practices in country.
Present government started the journey where the previous government lift. Government is struggling to find a way for the implementation of second phase. From the very first day Prime Minister promised to mend the practices and pave a way for the smooth implementation. Prime Minister also visited China two times and assured the Chinese government and private investors that there would be visible changes in the policy and implementation spheres.
Unfortunately, Pakistan is still waiting for these required changes. There is no Special Economic Zones (SEZ) Policy. It was planned to establish nine SEZs but not a single SEZ is operational. These SEZs are either present on maps or declared land. Regrettably all SEZs are without any type of services or facilities. Owing to lack of facilities or services no investor is not willing to venture in SEZ sector in Pakistan.
Lack of preparedness is creating problems and annoying the partners including private sector. First of all, it has shaken the trust of private sector. Private sector, national and international, is quite disappointed. International investors travel to Pakistan with the hope to find a suitable place in SEZs. Chinese investors standout among all international investors. We can see every other day some delegation from China visit Pakistan. China’s government also motivate investors to visit Pakistan. However, on their arrival they find that SEZs are still a dream to come true. It discourages the investor and they avoid travelling again.
National investors also waiting for the operationalization of SEZs. They are ready to invest in country. Private sector is also trying to bring foreign investor through joint ventures. Private sector is even ready to build private SEZs but faces many problems. During the last few years we have witnessed many CEOs of foreign companies visited Pakistan and showed interest to invest in joint ventures. Most of the times Prime Minister Imran Khan meets these delegations and assure them better investment facilities.
The real problem starts after the meeting with Prime Minister. Investors have to run after many ministries and departments with limited success. For example, according to international ranking by World Bank it takes 117 to get connection of electricity. The procedure to start construction is even worse and it takes 266 days to start construction. For starting any business investor has to deal with 7 agencies and there are 10 procedures and in New Zeeland there is only one procedure. These all factors discourage investors and they hesitate to invest.
Second China government is also struggling to comprehend the dynamics of Pakistan’s economy and governance. Moreover, China is also victim of uncalled criticism due to bad investment regime, business facilitation, lack of skilled labour and undue delays in operationalization of SEZs. Although China has nothing to do with it but still faces criticism from interest-based groups. These circumstances put pressure on China and somehow make them worry. Fortunately, China does not give much attention to criticism and keep investing in Pakistan. Last week a leading Chinese company Fushun Electric Porcelain Manufacturing started a new project under CPEC, which is of $1.7 billion worth.
However, Pakistan needs to understand how long private sector and China can tolerate such situation. Private sector and China, both have other options to invest in world. For example, in region Iran is emerging as one of the best bids for the investment for China. Export-Import Bank of China has already extended a loan of $8.5 billion for 26 projects in Iran. China has also provided a loan of $1.5 billion for electricity. Another Chinese company is interested to provide $22 billion for railway infrastructure in Iran. Bilateral trade between China and Iran has reached $33.39 billion in 2018. Iran also had requested China for a feasibility study to construct Chabahar and role of China. Iran has started visa free entry for Chinese tourists.
Situation urged Pakistan to come out of slumber and act according to the need of economy and CPEC. Pakistan should stop testing the patience of our partners. We should respect them not annoy them. CPEC is a great opportunity and we must not let it be victim of our negligence. We should start working on war footing to reform our investment regime, governance model, implementation framework and enhance trust of our partners. Prime Minister has to sit with his team and ask them to deliver on ground and come out of rhetoric and stop selling dreams. Most importantly, Prime Minister must ask his team and ministers to stop negative posturing in public.
Owning to bad performance of different sectors people started to point finger towards Prime Minister. Although the Prime Minister is putting all his efforts to revive the economy and implement CPEC with true spirit of CPEC, but Prime Minister is not getting required support from his aids. Prime Minister must resolve this issue and pave the way for smooth implementation of CPEC and revival of economy.
Lastly, Pakistan should come out of rhetoric mood and start to concentrate on work. We lost much precious time in praising and keep on talking about friendship. It is good we values friendship but in business or investment dealing we must work according to the ethics of business. It will help to strengthen our friendship and achieve sustainable development in country.
