ISLAMABAD – Of a total of $ 28 billion used so far for CPEC projects, the Pakistani government’s financial liability is only $ 5.8 billion, comprising low-interest loans and debts. grants in infrastructure projects spread over a payback period of 20 to 25 years.
The Ministry of Planning, Development and Reforms clarified a press article disseminated by some sections of international media titled “IMF will not prevent China from turning Pakistan into the next Sri Lanka”, published on July 4, 2019 The article is based on incorrect data. and distorted facts.
CPEC spokesman Hassan Daud Butt said the writer should know that the China-Pakistan Economic Corridor (CPEC) is a flagship project of the Belt and Road Initiative. Funding for CPEC includes government-to-government loans, private investments, and grants.
According to the spokesperson, to date 22 projects worth $ 28 billion are in various stages of implementation, of which $ 22 billion are private sector energy projects.
The financial liability of the Pakistani government is only $ 5.8 billion, including low interest loans and grants in infrastructure projects spread over a payback period of 20 to 25 years, a- he added.
Energy projects are carried out only on the basis of independent electricity producers (IPP) and financing is mainly taken by private companies on their own balance sheets. Therefore, the debt would be borne by the investors instead of any obligation on the part of the Pakistani government. Therefore; the impression that the debt burden weighs on the government of Pakistan is based on incorrect analysis.
Likewise, stating that “CPEC will add to corruption” makes it clear that the author is unaware that the second phase of CPEC is focused on industrial cooperation (JV B 2 B), socio-economic development and cooperation. agricultural sector, geared towards reducing the poverty of the least developed. regions of Pakistan on the basis of pragmatic planning and due diligence on both sides.
Comparing cooperation with China through CPEC, with any other country, is unrealistic as it has overcome critical bottlenecks in energy, transport infrastructure and supply chain. .
Within the framework of the CPEC, the development of Gwadar projects (mainly through grants / interest-free loans) would ensure the strengthening of the maritime sector. The development of the Gwadar port project is in BOT mode and cannot be compared to any port project developed with foreign financing / loans. Gwadar continues to be a high priority and is being developed as a stand-alone project as well as a transshipment center based on blue economy principles.
Overall, CPEC acts as a stimulus for Pakistan’s economic growth. The false account of a “debt trap” is not based on the realities on the ground, the spokesperson concluded.