‘Pak minister’s remark on CPEC could’ve cost foreign investment’

Islamabad: Former Chief Economist of Pakistan Dr Pervez Tahir hit out at Pakistan Cabinet Minister Abdul Razak Dawood, days after he cried foul for being misconstrued by the media, when he said, “Islamabad is rethinking its role in China’s Belt and Road plan”.

Dawood made the statement during an interview with London-based news paper, Financial Times.

In an opinion piece titled ‘In and out of context’, published in Pakistan Daily, The Express Tribune, Tahir said that the adviser to the prime minister on commerce and textile, alleged foul play by the media, after his statement on the China Pakistan Economic Corridor (CPEC) was questioned by the influentials in his party.

“To prove that he could not just go after the minuscule Utility Stores Corporations, but also mega initiatives like CPEC, Razzak Dawood chose the Financial Times. He repeated, within quotes, all that the detractors of One Belt One Road and CPEC say ad infinitum. When confronted by the influentials of the ruling party, he came out with the explanation that he was quoted out of context,” said Tahir.

Tahir asserted that Dawood’s statement had the ability to harm the Sino-Pak relations and cost Islamabad huge amount of foreign investment.
“The context is clear to all except the adviser. The US Secretary of State had unequivocally warned against deploying a possible IMF programme to repay the CPEC loans. Other Western countries have misgivings about the rising economic clout of China,” Tahir said.

“China’s foreign minister was in town to renew the game-changing economic relationship with the new government in Pakistan. Before any discussion began, the adviser threw the bombshell of enforcing a one-year long pause in the execution of CPEC projects. Make no mistake. The adviser’s statement was part of this context, not out of context,” he added.

Tahir further said that the CPEC emerged on the scene, when the investment rate in Pakistan had crashed to 13 per cent of GDP and economic growth rate was a poor 4 per cent. Though, in Financial Year 2018, the investment rate was 14.8 per cent and growth rate a decent 5.8 per cent.

“The investment rate in the country had crashed to 13 per cent of GDP and economic growth rate was a poor 4 per cent. What to speak of foreigners, even local investors, including the adviser, were not willing to bet on Pakistan.

In FY 18, the investment rate was 14.8 per cent and growth rate a decent 5.8 per cent. Without caring for the poor showing on the Ease of Doing Business Index, CPEC contributed the lion’s share. The adviser’s context is different.

The suggestion is that the agreements are loaded against Pakistani interest, despite the fact that China had no alternative to Gwadar,” he said.

Tahir further slammed the Pakistani bureaucrats for lacking professional capacity, saying, “Pakistan’s bureaucracy has always been signing contracts with its eyes closed. It has no professional capacity to draft an agreement or prepare counter-drafts.”

“The so-called “Economic” Affairs Division has no trained economists to challenge these invoices or be ready with own estimates. CPEC was no exception. It should come as no surprise that the country invariably loses its cases at international legal forums. The fine print of law in economic matters is not our forte. The Chinese acted in their own interest, plus they accommodated all of the silly suggestions made by us. They would be more than willing to accommodate other silliness, so long as they can protect their own interest,” he added.

He further elucidated that there is a civil-military consensus on the economic and strategic dimensions of CPEC. The unconventional change of command on the civil side, was bound to lead to some renegotiation.

“The echoing of international concerns in global media, with no first-hand knowledge of real contents of the CPEC agreements, was a shot in the dark.

It did no credit to the government when the Chinese ambassador rushed to the COAS to seek reassurances. There is a beam in our eye,” he said.