A headless chicken: Multiple obstacles hit CPEC’S progress

 A ‘headless’ body, officially admitted as such, is supposed to be taking (or delaying) decisions in Pakistan regarding the 60 billion-dollar China-Pakistan Economic Corridor (CPEC) project.
The Pakistan Government’s ordinance under which the CPEC Authority (CPECA) was set up last year lapsed in July, 2020 and no fresh legal/constitutional arrangement has been made. Questioned by a parliamentary committee, the government said the body is headed by “no one.”
The man placed at the top of CPECA, retired Lt. general Asim Bajwa, is working away from the office, and not drawing any salary. He was forced to resign as a Special Adviser of Prime Minister Imran Khan in October following media exposure about over 90 business firms his family has allegedly set up. He was holding dual charge and now, Khan accepting his resignation as adviser, but retaining him as Chairman of the CPECA has become untenable.
Angry lawmakers are questioning both, the delays in CPEC’s work as a result of the government’s faulty procedures, and lack of transparency in the Authority’s working as envisaged in the 2019 ordinance. The government was forced to postpone the proposed China-Pakistan Economic Corridor Authority (Amendment) Bill, 2020.
In an editorial published on November 12, 2020, Dawn newspaper commented: “It is ironic that an agency that was created to inject momentum into CPEC projects and streamline the initiative’s policy making process is caught up in a storm because the government didn’t put in the effort required for the timely passage of legislation. That is not all. The government’s refusal to address questions regarding the financial probity of the authority head have also led to transparency concerns.”
Major opposition parties, already knitted into Pakistan Democratic Movement (PDM) that has held three protest rallies and is preparing for one on November 23, have launched a multi-pronged attack on the government. They are questioning slow progress on the CPEC projects, and also demanding transparency.
Unused to being questioned in their system, the Chinese have become bitter towards this; even more than the Khan government. Indeed, they demanded greater role for the Pakistan Army by going way beyond providing security. The CPECA was set up to assuage their concerns, but critics say it has failed to deliver.
Attacks on CPEC projects sites and on Chinese personnel by nationalists and separatists have taken place, especially in Balochistan. China is viewed as an ‘invader’ working in cahoots with Islamabad to drain away the immense minerals and other natural resources.
Pakistan is belatedly waking up to the raging Covid-19 pandemic that has seriously contributed to the delays. After resisting lockdown for months, the government is now trying to enforce it, delaying things further, especially on projects running through the countryside where medical infrastructure is abysmal.  
These are only some of the problems because of which CPEC has been moving at snail’s space, if not completely run aground. Multiple obstacles have dogged its progress, forcing benefactor China to conduct a detailed review.
Pakistan remains cash-strapped and is unable to put in even 10 percent of the project expenditure and now it wants a special one percent interest rate from China that the latter finds uneconomic. Concerned at the prospects of becoming a loser, it has begun to delay further investment. 
Analysts believe that after leaning on China for loans, Pakistan is now left with no other option as the western banks are concerned about the lack of transparency in these Chinese loans.
Direly delayed is the CPEC’s prime $6.8 billion Main Line 1 (ML-1) project. It aims to revamp the colonial-era railway’s infrastructure and create as many as 150,000 new jobs besides additional freight revenue after completion.
The CPEC is also dogged by corruption, both in Pakistan at the government and corporate levels, and by the collaborating Chinese companies. Driven by his electoral promise to fight corruption, Khan put on hold several CPEC projects on the suspicion of corruption under the previous government and sought to renegotiate and realign the scheme, part of China’s Belt and Road Initiative (BRI) which seeks to pave a trade route connecting China through Pakistan to the Indian Ocean.
Two years later, his own Cabinet members are being named in big corruption complaints in the country’s power sector wherein a third of power companies are involved in Chinese projects under the CPEC’s umbrella.
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 $1.8 billion in subsidies given to 16 independent power producers (IPPs) including those belonging to Khan’s advisers Razak Dawood and Nadeem Baber.
These IPPs invested around 60 billion rupees ($37.5 million) in establishing power plants and earned over 400 billion rupees ($2.5 billion) in just two to four years. The profits earned by Chinese power companies were also scrutinized in the report.
The SECP claimed that both Huang Shandong Ruyi Pakistan Ltd (HSR) and Port Qasim Electric Power Co Ltd (PQEPCL) were overpaid by 483.6 billion rupees ($3 billion), including for excess set-up costs and miscalculations of internal rates of return allowed by the National Electric Power Regulatory Authority and the Central Power Purchase Agency, respectively.
Finally, the geopolitical changes currently taking place also do not augur well for the CPEC. The West, especially the USA, views it with disapproval and has repeatedly said charged that like many other countries who have opted for the BRI, China is dragging Pakistan into the biggest debt trap with the CPEC. The Corridor, they say, is only a ruse to reach from Kashgar to Karachi, into the Indian Ocean. This is unlikely to change with the impending exit of a hostile Donald Trump and entry of a relatively ‘Pak-friendly” Joe Biden in the US Presidency. The new administration would need Pakistan’s help to quit Afghanistan, but will be relentless on Chinese expansion via CPEC.

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