2018 in Review: 11 CPEC Projects Completed, 11 in Progress

Since the inception of China Pakistan Economic Corridor five years ago, 11 development projects
have so far been completed with as many under construction using a total investment of around $18.9
billion, which have also created 75,000 jobs for Pakistani people.

According to the latest progress report on CPEC issued by the Chinese Embassy in Pakistan, 20
more projects were in pipeline under CPEC, which was the largest and most comprehensive project under
the Belt and Road Initiative (BRI), besides being of great political, economic and social significance to
China and Pakistan.

For implementation of CPEC, the two sides have set up a ministerial-level Joint Cooperation
Committee on CPEC Long Term Planning (JCC) and seven joint working groups on planning, energy,
transportation infrastructure, Gwadar Port, industrial cooperation, social economic development and
international cooperation. They also decided to establish Joint Working Groups on social economic
development and international cooperation.

CPEC Energy Projects

Out of 15 energy projects planned as priority with a total generation capacity of 11,110MW, seven have
been completed and in operation, while another six are under construction with a total capacity of
6,910 MW.

At present, Zonergy 300MW Solar Park, 50MW Dawood Wind Farm, Jhimpir UEP wind power
project, Sachal 50MW Wind Farm, Sahiwal 2×660MW Coal-fired Power Plant, Port Qasim
2×660MW Coal-fired Power Plant and Three Gorges Second and Third Wind Power Projects have
been completed. These projects have added 3240 MW to the Pakistani national grid, amounting to more
than 11% of the total installed capacity of 29,000 MW in the country.

CPEC energy projects are providing affordable energy to Pakistani consumers in a diversified way. The
tariff of power plants has been sharply decreased from Rs 16-18 to around Rs 8 per unit. With the
introduction of CPEC energy projects, Pakistan also reduced its heavy dependence on gas and LNG power
plants, which account for 50% of total installed capacity. The CPEC energy projects are foreign direct
investment and are executed in accordance with BO(O)T mode. Any debt arising from the CPEC energy
projects would be borne by the Chinese investors instead of the Pakistani government.

CPEC Infrastructure Projects

Regarding infrastructure projects, the report said currently, three projects including KKH Phase-II
(Havelian-Thakot section), Karachi-Lahore Motorway (Sukkur-Multan section) and Lahore
Orange Line are under construction. The information highway for laying of an optical fiber cable (OFC)

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from Rawapindi to Khunjrab is in operation. These ongoing projects are funded by preferential loans from
the Chinese government at around 2% interest rate with a total amount of 5.874 billion USD. The up-
gradation of ML1 railway and the KCR are under discussion.

CPEC Gawadar Free Zone

About Gwadar Port, it said up to now China Overseas Ports Holding Company (COPHC) has invested $ 250
million in the port renovation. Five new quay cranes, a 100,000 M2 storage yard, a seawater desalination
plant with capacity of 220,000-gallon pure water/day, two sets of sewage disposal systems and cargo
handling equipment have been installed and 80,000 M2 green space has been added to the port area.
400,000 tons of cargoes have been handled by Gwadar Port in 2017.

The Gwadar Free Zone is located in the northern part of Gwadar. The planned development period is from
2015 to 2030, and is divided into four phases. The 923-hectare Free Zone includes an initial area (25
hectares) and the northern area (898 hectares).

Around 30 companies have invested in the Free Zone, with direct investment of about $474 million. With
the construction of the free zone, the city of Gwadar will become a commercial hub of the region in the
near future. The construction of Gwadar East Bay Expressway project was started in November 2017 and
would be completed in 36 months with the designed speed of 100 kilometers per hour.

CPEC Industrial Cooperation

About the industrial cooperation, the embassy said Pakistan had submitted a list of nine Special Economic
Zones to China and from 2017 to 2018, China’s expert panel had three successive on-site visits to
proposed SEZs. The expert panel had also sent BOI its appraisals of the feasibility studies of six SEZs,
while the rest three are to be submitted.

In early 2018, Pakistani Government had instructed BOI to formulate more accurately-targeted and more
favorable policies on top of current preferential policies for two to three SEZs that were to be listed as key
projects under CPEC.

Jobs in CPEC Projects

According to the preliminary statistics, CPEC projects have created more than 75,000 direct job
opportunities for Pakistani people. The Chinese companies also subcontract a large number of projects to
local Pakistani companies.

According to a report in 2017 by Deloitte, a professional services firm, CPEC will create 700,000 jobs for

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 2018 in Review: 11 CPEC Projects Completed, 11 in Progress

Pakistan from 2015 to 2030. A recent study by CPEC Centre of Excellence, Ministry of Planning,
Development and Reform of Pakistan showed that CPEC could help create 1.2 million jobs under its
presently agreed project.

Under social responsibilities, Chinese companies were also investing on vocational training and education,
human resource development through scholarships to thousands of Pakistani students, medical care and
mini projects for uplifting the living standards of poor people across Pakistan.

The two sides have set up a cooperation mechanism to coordinate the development of CPEC and jointly
formulated the Long-Term Plan for China-Pakistan Economic Corridor (2017-2030). This plan is effective till
2030, the short-term projects included will be considered up to 2020; medium-term projects up to 2025;
and long-term projects up to 2030.

Published in Daily Nation (31st December 2018)

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