Pakistan seeks to revive BRI projects with China to boost troubled economy

Pakistan’s new government aims to revitalise projects under China’s Belt and Road Initiative (BRI) to strengthen its troubled economy. CPEC is a USD 50 billion Pakistani component of China’s Belt and Road Initiative (BRI). The 3,000 km Chinese infrastructure network project is under construction in Pakistan and aims to connect Pakistan’s Gwadar and Karachi ports to China’s Xinjiang Uygur Autonomous Region by land.

Prime Minister Shehbaz Sharif has been seeking to revive economic cooperation with China, building on efforts initiated when his brother, Nawaz Sharif, signed onto the BRI in 2013. Sharif is expected to undertake an official visit to China from June 4 to 7, reported ARY News citing sources. During his four-day state visit, the PM will hold meetings with the Chinese president and prime minister and will discuss the matters related to the China-Pakistan Economic Corridor (CPEC) phase II and other issues.

After recent meetings with Chinese leadership, Ahsan Iqbal, Pakistan’s federal minister for Planning, Development, and Special Initiatives, expressed optimism about renewing momentum for the China-Pakistan Economic Corridor (CPEC).

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Iqbal who also co-heads the committee responsible for the China-Pakistan Economic Corridor said in a interview as quoted by Bloomberg “Yeah, I’m very hopeful because I was there in China recently and I had meetings with their senior leadership,” said Iqbal at his office in Islamabad, decorated with a large map showcasing the China-Pakistan Economic Corridor. “So I see great interest on the Chinese side to revive the momentum for CPEC and also to take it into the second phase.”

The first phase of CPEC saw $25 billion worth of projects, including power plants that alleviated Pakistan’s power deficit. Recently, a long-delayed railway upgrade project was approved, scaled down from $10 billion to $6.8 billion, to ease Pakistan’s financial burden. The project’s first phase will connect Karachi to Multan.

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The Sharif government has also completed key BRI projects, such as a water-supply project in Gwadar and an electricity transmission line from Iran, restoring Chinese confidence in Pakistan’s commitment to CPEC. China, a major financial lender to Pakistan, has helped the country avoid bankruptcy amid its economic struggles.

Marking CPEC’s tenth anniversary, China announced five new corridors to boost Pakistan’s economic activity, focusing on growth, livelihood, innovation, green energy, and regional connectivity. Sharif is expected to visit China soon to further these initiatives.

In the second phase of CPEC, Pakistan plans to encourage private sector partnerships with Chinese firms and attract Chinese companies looking to relocate due to rising labor costs and geopolitical tensions. Iqbal highlighted the potential to attract jobs relocating from China, citing overcrowding in other countries like Vietnam, Laos, and Cambodia.

With inputs from agencies.