Sep 11, 2018

Pakistan: New Government Intends to Renegotiate CPEC

Pakistan’s new government intends to review and renegotiate several deals with China, including the trade agreement related to the China-Pakistan Economic Corridor. The reasoning behind this decision is that the agreements negotiated over a decade prior were unfair and biased in China’s favour. UNPO remains skeptical of this decision and calls on the Pakistani government to renegotiate these agreements in a way that accounts for the wishes and interests of the indigenous inhabitants of the affected regions, including Gilgit-Baltistan, Sindh and Balochistan.

The below article was published by the Times of India:

UK daily Financial Times (FT) reported Monday 10 September 2018 that Pakistan has called its deals with China & Pakistan because the agreement to do with the China-Pakistan Economic Corridor (CPEC) “unfairly benefits Chinese companies”, said the News International.

The new Imran Khan government will review its role in China's Belt and Road Initiative and renegotiate a trade agreement signed more than a decade ago, the UK Daily reported, citing Pakistani officials.

“The previous government did a bad job negotiating with China on CPEC — they didn’t do their homework correctly and didn’t negotiate correctly so they gave away a lot,” reported The Financial Times, quoting Abdul Razak Dawood, Prime Minister Imran Khan's Adviser on Commerce, Textile, Industry & Production and Investment.

Meanwhile, news agency PTI reported that Khan said on Sunday that the 'all-weather' friendship with China was a cornerstone of Pakistan's foreign policy, even as he pledged to implement the controversy-hit $50 billion CPEC. Chinese Foreign Minister Wang Yi called on Khan and expressed desire to further enhance the bilateral strategic partnership, the PTI report added.

Khan's advisor appears to have struck a dissenting note in his comments with the UK daily.

 “Chinese companies received tax breaks, many breaks and have an undue advantage in Pakistan; this is one of the things we’re looking at because it’s not fair that Pakistan companies should be disadvantaged,” he's quoted as saying.

He went further.

 “I think we should put everything on hold for a year so we can get our act together...Perhaps we can stretch CPEC out over another five years or so," Dawood is quoted as saying.

Before he became PM, Khan, didn't always have good things to say about the CPEC project. He'd been mostly worried about what he thinks is the lack of transparency and the possibility of widespread corruption at CPEC's myriad projects.

After becoming PM, it appeared Khan softened his tone on CPEC. In an interview with a Chinese daily a few days before the country's general elections in July, he said "the corridor project has brought about many positive changes to multiple areas of Pakistan's economy", reported Pakistan's Daily Times, quoting Khan's interview with Chinese language newspaper Guangming Daily.

"The changes prove that the corridor has a positive effect on the development of Pakistan. I believe that the corridor construction in the medium and long term will be firmly guaranteed and will continue to be implemented," Khan said to the Chinese newspaper, according to Pakistan's Daily Times.

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