Daily The Business

CPEC aftershocks: We are fast losing Made in Pakistan status

Faisal Ali Ghumman

All developed and developing nations in the world have always been seen adopting indigenous approach towards lifting their economies and recognizing themselves in the United Nations’ development indicators.

Talk about countries like Japan, China, Malaysia, Turkey, Mexico and Bangladesh and we find the economic reforms successfully run and implemented by their successive regimes.

Their common objective was to promote local industry with the help of locals and foreigners, transform agriculture into export-oriented industrialization and generate more and more jobs for local habitants.

There will be hardly any country in the world except Pakistan that welcomes foreigners to set up their industry at the cost of local industry and manpower.

Why Pakistan lags behind on all fronts of the development indicators always remains an unanswered question I leave to the senseless nation, people at the helm of affairs and state institutions to decide.

In the last couple of decades, we only used to welcome foreign investment instead of strengthening side by side our local manufacturing and export industry. Overall inconsistent policies coupled with law and order situation kept hindering the country of reaping benefits of investment potential.

Our export-led industrialists shifted a chunk to the countries like Bangladesh, UAE and Malaysia in the last one decade or so after facing rising cost of doing businesses and competitiveness challenges.

Amidst struggling economy and revival of ill-fated industry we came across the China’s ambitious global plan of One-Belt-One-Road (Belt and Road initiatives) and China-Pakistan Economic Corridor (CPEC) in Pakistan’s perspective.

As China dreamt of building infrastructure, transportation and energy in Pakistan stretching from its border in Xinjiang province to Gwadar part of Pakistan both sides struck expensive loan agreements with balance of investment in China’s favour as usual.

Where to go, where to run and where to hide? The sensitive agencies of the country and academic circles blame the Nawaz Sharif-led government of striking hidden agreements with the Chinese government at the cost of local industry and labour.

Veteran politician and 7thMalaysian Prime Minister Dr Mahatir Mohamad has recently been quoted as saying Malaysia will not welcome China to completely replace its local industry with Chinese by bringing entire imported material and labour force.

Dr Mahathir in May 2018 had expressed particular concern about financing arrangements for such massive infrastructure undertakings in Malaysia such as the East-Coast Railway Link (ECRL), which he said may place undue burden on public coffers in the country.

He further pointed out that a responsible government must try and reduce its debt to other nations.

In August, Mr Mohamad told China’s leaders he was cancelling a controversial rail project and a gas pipeline in order to reduce Malaysia’s debts.

“I believe China itself doesn’t want to see Malaysia become a bankrupt country,” he said a day after meeting with Chinese president Xi Jinping.

“The simplest service the PTI government can render to the nation is to limit Chinese government to let Chinese manufacturing units and spare parts established in Pakistan with employment of Pakistani labour and monetary deals through Pakistani banks”

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He is the same person who introduced economic reforms being fourth prime minister of Malaysia in 1980s/90s and transformed the country from the feudalistic clutch into the industrial revolution.

Another example is Bangladesh as the United Nations Committee for Development Policy announced in March this year that Bangladesh had successfully met the criteria to graduate from a “least developed country” (LDC) to a “developing country” (DC).

Now come to Pakistan and confirmed reports portray horrible picture of arrival of a good number of Chinese firms which have got settled in big cities like Peshawar, Lahore, Karachi and Multan and are purchasing lands to develop their industry and businesses with own countrymen as labourer force.

Pakistani government is providing security to the Chinese nationals working on CPEC and non-CPEC projects at the cost of national kitty while Pakistan will have to pay a long-term interest on CPEC-led borrowings in decades to come.

A research recently carried out by a Pakistani student studying at an Australian university suggests Pakistani external debt fears to hover around USD 125 billion if Chinese funding for CPEC is to be added to overall external loans worth USD 90bn the country carries.

The local markets have been flooded by Chinese products and traders and shopkeepers are either seen telling the customers about absence of Pakistani items or choice between the two.

Where do we stand at the moment is an eye-opener for Imran Khan-led government to think revisiting the agreements with China on equal footing.

The simplest service the PTI government can render to the nation is to limit Chinese government to let Chinese manufacturing units and spare parts established in Pakistan with Pakistani labour and monetary deals through Pakistani banks.

As the PTI government seems flexing its muscles to seek borrowings from international lenders to arrest the gloomy state of economy, any anti-state agreement would further aggravate the situation.

The time also demands from the nation to accept the austerity slogan of the current government to curtail expenditures and cooperate with the tax collection agencies.

And the government needs to save the ailing export-oriented agriculture and manufacturing industry on the pattern of incentives China, Malaysia and Bangladesh extend to their people.

Seventy years have passed and now Prime Minister Imran Khan and the nation must realize one thing that charity begins at home. This is time to get rid of the habit of depending upon others, generate income from our own resources and preserve and portray image of ‘Made in Pakistan’ in the world.

–The writer is Country Editor The Business and Ex-Reporter Daily Dawn

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