OBOR News & Developments

[JohnX]

Chinese experts to visit SEZs of CPEC in Pakistan

A team of Chinese experts will arrive in Pakistan in a few days to shape up their country's investment plans for Special Economic Zones (SEZs) of the China-Pakistan Economic Corridor (CPEC).

A preparatory meeting chaired by Pakistan's Planning and Development Minister Ahsan Iqbal on Tuesday reviewed the availability of land and infrastructure and the investment plans for the SEZs of the CPEC.

The meeting was attended by representatives from PoK (Pakistan occupied Kashmir), Gilgit-Baltistan, the Federally Administered Tribal Areas (FATA) and Board of Investment Chairman Miftah Ismail.

Citing sources, the Dawn reported that the minister was not impressed with the presentations made by the provincial governments to attract Chinese investment.

Iqbal asked the representatives to come up with detailed and profitable schemes for the zones to make it look more attractive to investors.

The representatives of the provinces gave presentation regarding the prospective zones and the updated availability of facilities in the their region during the meeting.

According the report, the meeting was informed that nine SEZs would be set up in all the provinces and other regions.

The two SEZs, including the development of an industrial park on Pakistan Steel Mills land at Port Qasim, near Karachi will be setup by the Pakistan government itself.

The Chinese experts, who are the part of Joint Industrial Working Group, would discuss the incentives for the investors and the feasibility of the SEZ sites during their Pakistan visit.

"Chinese investment will augment our industrial capacity through state-of-the-art technology and expertise, enabling our productivity" the Dawn quoted Iqbal as saying.

He urged local businessmen to engage with their Chinese counterparts and develop joint ventures that would provide opportunities of transfer of knowledge and experience.

http://www.business-standard.com/ar...-sezs-of-cpec-in-pakistan-117070500407_1.html

 

[Suryavanshi]

Folks looks whose back

@Project Dharma @aditya10r @OneGrimPilgrim @Dovah @Ancient Indian @Kshatriya87 @Screambowl @Bornubus

 

[JohnX]

CPEC first mega initiative

It is quite appreciable to note that Sahiwal Coal Power Plant is the first mega initiative of the comprehensive CPEC project which has been completed in a record time of 22 months and is making valuable contribution of 1320 megawatt of power to the national grid for over a month. It has now formally been inaugurated by Punjab Chief Minister Shehbaz Sharif in the presence of Administrator for China National Energy Administration and Reforms Commission Vice-Chairman Nur Bekri, Chairman Huaneng Group of China Cao Peixi, Chinese Ambassador in Pakistan, H.E. Mr. Sun Weidong among others.

The CM availed the opportunity to thank the Chinese leadership including the President, the Prime Minister and senior officials of a number of Chinese companies for their continued support and assistance to Pakistan in general and Punjab in particular for overcoming the lingering energy crisis at the earliest possible.
Calling the occasion quite historical, the Chief Minister quite rightly gave the due credit to the leadership of Prime Minister Nawaz Sharif for initiating and implementing work on different CPEC projects pertaining to energy sector in a rapid progress pushing Pakistan to wards a brighter prosperous future. The Chinese companies senior officials appreciated and praised Chief Minister Shehbaz Sharif whose commitment, hard work with speed in a transparent manner has led to the completion of the first coal fired power plant under CPEC umbrella in a record time.

China National Energy Administration and National Development and Reform Commission Administrator Nur Bekri paying rich tributes to Chief Minister Shehbaz Sharif said that a new history has been written in the whole world adding joint collaboration on energy projects with Pakistan including the Punjab will continue assuring further that they are always there to meet the energy needs of Pakistan. Sahiwal Coal-Fired Power Plant is yet another symbol of ever increasing and strengthening warm good and sincere neighbouring countries of China and Pakistan and the CPEC is further promoting the all-weather, time-tested relations of mutual trust and cooperation between Pakistan and China.

https://pakobserver.net/cpec-first-mega-initiative/

 

[Mikesingh]

Building a railway system from Kashgar over the mountains into Pak is easier said than done, seeing the treacherous terrain obtaining there. But than there's always Xi and Allah to bank upon!

 

[AmoghaVarsha]

CPEC first mega initiative

It is quite appreciable to note that Sahiwal Coal Power Plant is the first mega initiative of the comprehensive CPEC project which has been completed in a record time of 22 months and is making valuable contribution of 1320 megawatt of power to the national grid for over a month. It has now formally been inaugurated by Punjab Chief Minister Shehbaz Sharif in the presence of Administrator for China National Energy Administration and Reforms Commission Vice-Chairman Nur Bekri, Chairman Huaneng Group of China Cao Peixi, Chinese Ambassador in Pakistan, H.E. Mr. Sun Weidong among others.

The CM availed the opportunity to thank the Chinese leadership including the President, the Prime Minister and senior officials of a number of Chinese companies for their continued support and assistance to Pakistan in general and Punjab in particular for overcoming the lingering energy crisis at the earliest possible.
Calling the occasion quite historical, the Chief Minister quite rightly gave the due credit to the leadership of Prime Minister Nawaz Sharif for initiating and implementing work on different CPEC projects pertaining to energy sector in a rapid progress pushing Pakistan to wards a brighter prosperous future. The Chinese companies senior officials appreciated and praised Chief Minister Shehbaz Sharif whose commitment, hard work with speed in a transparent manner has led to the completion of the first coal fired power plant under CPEC umbrella in a record time.

China National Energy Administration and National Development and Reform Commission Administrator Nur Bekri paying rich tributes to Chief Minister Shehbaz Sharif said that a new history has been written in the whole world adding joint collaboration on energy projects with Pakistan including the Punjab will continue assuring further that they are always there to meet the energy needs of Pakistan. Sahiwal Coal-Fired Power Plant is yet another symbol of ever increasing and strengthening warm good and sincere neighbouring countries of China and Pakistan and the CPEC is further promoting the all-weather, time-tested relations of mutual trust and cooperation between Pakistan and China.

https://pakobserver.net/cpec-first-mega-initiative/

What is cost per unit to end consumer?

 

[Mikesingh]

What is cost per unit to end consumer?

Now Rs 7-8 PKR per unit.
Future costs Rs 18-20 PKR per unit.
Commercial Rs 26-28 PKR per unit.

Bottom line: The Porkis are screwed! :biggrin2:

 

[Suryavanshi]

So they are building Railway in our land and we can't do shit about it.

 

[Butter Chicken]

So they are building Railway in our land and we can't do shit about it.

Game has started.You will see results in 2025-2030 period.

 

[AmoghaVarsha]

Now Rs 7-8 PKR per unit.
Future costs Rs 18-20 PKR per unit.
Commercial Rs 26-28 PKR per unit.

Bottom line: The Porkis are screwed! :biggrin2:

Bhai mujhe bol deta main bhi ek powerplant laga deta.

 

[Suryavanshi]

Game has started.You will see results in 2025-2030 period.

How much time and money would CPEC take for full completion?
BTW we can only expect action if BJP stays as the ruling party.
Kangress is a lost cause.

 

[JohnX]

China’s OBOR Juggernaut Rolls On as a Mute India Watches

https://www.thequint.com/opinion/2017/07/04/china-obor-juggernaut-mute-india-watches

India is wary of China’s ambitious One Belt One Road (OBOR) project, also known as the Belt and Road Initiative (BRI), and boycotted the first BRI International Forum summit hosted by China on 14-15 May. While India is unlikely to change its policy on this issue, New Delhi is keeping close tabs on the progress of OBOR/BRI, though not many details are available in the public domain.


What Does China Hope to Achieve Through OBOR?
The Chinese companies have already made a huge investment of $50 billion during 2014-16 in the participating countries under the OBOR project, as per the Chinese Ministry of Commerce. China has so far signed 12 cooperation agreements under the OBOR initiative with other countries including Singapore, Montenegro and Kyrgyzstan, as well as with international outfits like the World Economic Forum and agencies within the United Nations.

Twenty countries, including countries in India’s backyard, like Pakistan, Sri Lanka, Nepal and Bangladesh, have agreed to participate in the OBOR project. But the Chinese are roping in more and more countries.

By the end of 2016, Chinese companies were engaged in building 77 cross-border economic cooperation zones in 36 countries.

Chinese investment in southern European countries like Greece, Bulgaria and Romania has already rocketed up. In Turkey too the Chinese are expanding their strategic footprints under the OBOR initiative.


Economic Objectives Behind OBOR

• Under the OBOR initiative, China is investing in countries in India’s immediate neighbourhood as well as European countries.
• The UK is also looking forward to the OBOR initiative in the wake of uncertain ties with the US and the falling Pound.
• The China-European Union service trade is estimated to touch $218 billion by 2020.
• By investing such huge sums, China is hoping to diversify and expand its economy.
• New rail connections to Central Asia and Europe will benefit cities like Chingqing, Chengdu, Xi’an and Lanzhou.

Trade Ties with EU
The UK too is set to lean more towards China, given its uncertain relationship with Europe, not-so-sanguine ties with a traditional strategic partner like the US, and the falling Pound Sterling. The talk of a China-European Union free trade area is set to gain momentum as China's OBOR bandwagon rolls on.

The China-EU service trade is estimated to breach the €200 billion ($218 billion) mark by 2020. The China-EU free trade will be a game-changer as it will synchronise China's economic transformation and Europe's pursuit of sustainable growth.

The Chinese enterprises have recently invested in Africa under the OBOR. The Chinese entities have made investments in the Port of Djibouti (a gateway to East Africa and the Middle East) and in a major railroad linking it to Ethiopian capital Addis Ababa, and in infrastructure and hydropower sectors in Kenya and Tanzania.

China Knows There Are No Free Lunches
Why has China made such a humongous investment in developing economies with huge investments in the pipeline? What does China stand to gain from this in terms of geopolitics and strategic policy?

Well, there are no free lunches. The Chinese are too smart to throw huge amounts of money into developing economies without any tangible and concrete returns!

First of all, one must appreciate the fact that Chinese President Xi Jinping unveiled his dream project in September 2013 in Astana, Kazakhstan when China had just emerged as the second-biggest economy in the world, relegating Japan to third place.

China showcased the project at the first BRI Forum Summit in Beijing on 14-15 May at a time when the United States under President Donald Trump was rapidly turning inward-looking and protectionist.

Meanwhile, here is a China that is not only fast shedding protectionism but also resorting to globalisation at a breakneck speed. In a way, China's OBOR project of pro-active globalisation is a clever counter to the “America First” inward-looking policy of the Trump administration.

China’s Gamble
This is China’s golden moment in contemporary history, as it is fast filling up the strategic and international leadership space being ceded by the Americans under the Trump administration. The contrast is huge.

On one hand, you have an America which has reneged on its Paris Pact pledges on climate change and has turned its back on the Trans Pacific Partnership (TPP). On the other hand, here is a resurgent China, which despite its own economic challenges, is wooing the outside world and has turned globalisation on its head.
It only shows that the Xi Jinping-led China is supremely confident of itself and willing to be a great gambler and loosen its purse strings for developing economies at a time when the world is still coping with a severe financial crunch situation.

By doing so, China hopes to attain twin strategic objectives:

(1) financing and building critical infrastructure in developing economies across the continents of Asia, Africa and Europe as a "grand cause benefiting people in regional countries along the ancient route" as Xi said in Kazakhstan nearly four years ago;

(2) and diversifying and expanding the Chinese economy, which needs restructuring.

Rebalancing of Powers
While embarking on OBOR, Beijing is also cleverly indulging in geographical rebalancing and boosting China's international trade by enhancing globalisation. By pursuing its “Go West” policy, China is discreetly developing its western region, which could have triggered serious repercussions for China on social and moral planes.

By constructing new rail connections to Central Asia and further on to Europe, China's western region has become central to the OBOR project, with cities like Chongqing, Chengdu, Xi'an and Lanzhou now becoming major transit hubs under the $90 billion project.

China's OBOR juggernaut is rolling ahead relentlessly. India will have to monitor the dragon's most ambitious project which is essentially aimed at winning friends and influencing people.

 

[JohnX]

Port City a vital cog in China's OBOR initiative: CHEC

The Colombo International Financial City (CIFC), formally known as the Colombo Port City, would play an instrumental role in China’s One Belt and One Road (OBOR) initiative because of Sri Lanka’s strategic location on the maritime silk route, the CHEC Port City Colombo (Pvt.) Ltd. said. Liang Thow Ming, the Chief Sales and Marketing Officer of the CHEC Port City Colombo (Pvt.) Ltd., told a Sri Lankan media delegation at the CHEC office in Beijing, China on Tuesday that the CIFC fulfils the needs and the aspirations of both China and Sri Lanka. “Where China is concerned, we have the OBOR initiative and Sri Lanka is right in the middle of the maritime silk route. Therefore, CIFC plays a vital role there.

Where Sri Lanka is concerned, it is looking at massive infrastructure investment and development in order to reinvigorate and uplift the economy,” he said. He assured those present that though the project had suffered a setback by getting delayed by a year due to the suspension of operations in March 2016, it would be completed by 2041, giving Sri Lanka a world class city for South Asia. He said that they want to lift Colombo to the same level of top metropolitan cities in the world. “We want to put Singapore in Colombo or Dubai and maybe Tokyo. That’s what we are trying to do,” Mr. Ming said.

He said the CIFC project was an investment amounting to US$1.4 billion just for land reclamation and construction. In terms of tourism, Mr. Ming said they were expecting to make Colombo a stopover destination for tourists by luring them to the CIFC. “Colombo is not a stop-over destination for tourists at the moment.

They bypass it most of the time. When tourists arrive in Sri Lanka, they can visit so many other parts of the country but most don’t want to see Colombo,” he explained. The reclaimed land of the CIFC would be separated into five precincts; Central Park Living with a channel and open areas, Financial District, International Island, The Marina and Island Living. Mr. Ming said that they were also creating a lagoon, 300 metres in width, adjacent to the Galle face Green, making it safe for people to swim in. T

hough the breakwater creation had been affected by the work suspension suffered by their company, the reclamation of the land taking place was on schedule and 45 per cent of the work had already been completed as of now, he said. (Lahiru Pothmulla in Beijing)

http://www.dailymirror.lk/article/Port-City-a-vital-cog-in-China-s-OBOR-initiative-CHEC-132280.html

 

[JohnX]

Finland could serve as China’s Arctic gateway for OBOR

http://www.atimes.com/article/finland-serve-chinas-arctic-gateway-obor/

Kirkenes, Norway is a small port that could play a big role in Obor

It was a meeting that could easily pass unnoticed. Chinese Premier Li Keqiang met with Finnish Prime Minister Juha Sipila on June 27 in Dalian, China, during the annual World Economic Forum meeting known as Summer Davos.

The upshot of their tete-a-tete was that China and Finland pledged to enhance bilateral cooperation in Arctic affairs and areas such as manufacturing and urbanization. Most important, Li told Sipila that China wanted to bolster communication with Finland in international and regional matters, specifically in the context of China-EU and China-Nordic cooperation.

The growing collaboration between the world’s second-largest economy and a small Nordic nation of 5.5 million people highlights a little-known fact: China’s One Belt, One Road (Obor) project has an Arctic angle. and Finland could play a pivotal role.

On the Finnish side, one of the most interesting proposals is for a €3 billion (US$3.4 billion) “Arctic Corridor” railway that would connect Northern Europe with China and Arctic Ocean deep-water ports. The idea is being pitched by a group of Finnish academics and business leaders. It would connect the city of Rovaniemi in northern Finland with the Norwegian port of Kirkenes on the Barents Sea.

Finland’s Arctic Corridor project. Illustration: Arctic Corridor
Ships could move goods from China as well as oil and gas from Arctic fields in Russia westward along the Northern Sea Route to Kirkenes. Cargos would be offloaded to the railway and sent southward through rail connections to Scandinavia, Helsinki, the Baltic states and the rest of Europe.

“The Arctic Corridor project sees Obor as very important as it provides an alternative to connect Asia with the Arctic and Europe,” Timo Lohi, a spokesman for the Arctic Corridor project, told Asia Times.

Lohi notes that Kirkenes in Norway is the closest Western port to Asia. The port is also ice-free, allowing the use of larger vessels and saving on icebreaking costs.

The Northern Sea Route, which runs along the Russian Arctic coast from the Kara Sea, along Siberia, to the Bering Strait, is assuming growing importance under Obor. Melting Arctic ice, in one example, makes it possible to ship gas by tanker from Russia’s huge $27 billion Yamal LNG (liquefied natural gas) project in Siberia, in which Chinese companies and development banks have hefty stakes.

Using the Northern Sea Route also lops an estimated 20-25% off the distance between Asia and Europe that use the Indian Ocean and the Suez Canal routes.

China’s rail freight angle
The Arctic Corridor railway could also be joined at the Finnish border to Russia’s rail network, which in turn connects with China’s. According to Lohi, this would enable Chinese freight to be transported to Europe by train. Such interconnected rail networks already allow goods to be delivered between the United Kingdom and China.

The Arctic Corridor project is at an early stage. Preliminary planning has started in Finland, and regional land use and other impact studies are under way. The plan will be discussed at Finland’s Kouvola Rail Forum in September. The planning process could take 10 years. Financing for the project is yet to be nailed down. But if cargo flows are sufficient, Lohi believes construction could begin by the early 2030s.

China is said to be aware of the project, though no official contact has been made. The Norwegian and Finnish transport ministries are also discussing how to cooperate on the effort.

Chinese financing for the Arctic Corridor is critical. European Union member Finland was battered by the 2008 financial crisis. Its economic growth still lags behind the rest of the euro zone, and various EU-related issues make it hard to secure other outside aid.

While Chinese interest in the project is uncertain, firms from China are already making hefty investments in Finland. China’s Sunshine Kaidi New Energy Group invested $1.13 billion in a new wood-based biodiesel plant in the northern city of Kemi. More Chinese investments are on the way.

In another gesture, Chinese President Xi Jinping paid his first state visit to Finland in April. Chinese media at the time noted that Finland in 1950 was one of the first Western nations to recognize China’s new Communist government.

What is more, Finland recently assumed the rotating chairmanship of the Arctic Council, an international body that Arctic littoral states including Russia and the US use to govern the Arctic. It will serve in that position until 2019, giving it leverage in Arctic matters of interest to China.

Latvia also a player
Finland isn’t the only prospective site for an Obor railhead. Another candidate is Latvia. Bordering Russia, it has well-developed cargo-shipping and rail-freight infrastructure dating to the Soviet era.

This was a factor when China opened an 11,000-kilometer direct freight route between Yiwu city in Zhejiang province and Riga, Latvia, last November.

Some observers say geography, logistics and expertise make Finland and Latvia the only logical choices for northern railheads that could serve Obor’s needs. In addition to airports and rails, Finland offers its capital port of Helsinki, while Latvia boasts the industrialized port city of Riga. Both nations, moreover, are EU members.

“Although there is currently no clear leader for establishing improved freight routes that connect China with Northern Europe, Finland and Latvia are emerging as the two favorites due to a combination of geographic, economic and logistical considerations,” said an April 6 article in The Baltic Times.

Moving cargo by sea to Kirkenes from Russia and China is more attractive than hauling it overland by rail.

“The notion of shipping goods by land from Asia to Europe is not very practical and [is] expensive,” said David Dollar, a senior fellow at the Brookings Institution in Washington, DC. “Last year there were 20,000 containers from China that went by rail to Europe. You can put 20,000 containers on one ship. So I think shipping will continue to be the overwhelmingly economical way to ship goods.”

Challenges
On the downside, analysts say both Finland and Latvia need substantial infrastructure investments to participate effectively in Obor, highlighting the need for Chinese cash.

Adam Lajeunesse, an expert on Arctic security, sees other challenges. He cautions that the demand for northern infrastructure projects like the Arctic Corridor is still theoretical and faces serious hurdles.

For one thing, he notes that large-scale development of offshore oil reserves in Russia’s Arctic is not economic given current oil prices. He adds that oil’s dilemma will be made worse if Western countries make a serious transition to electric vehicles in the next 20 years.

“I think there’s a real possibility that none of the Russian Arctic offshore oil is ever developed,” said Lajeunesse, who holds the Irving Chair in Arctic Security at Canada’s St Francis Xavier University.

Tensions between the West and Russia also remain high. Lajeunesse says this could complicate collaboration on multinational infrastructure projects like the Arctic Corridor. He points out that Baltic and Scandinavian nations are especially wary of Russia in the wake of alleged Russian cyber-attacks and fighter probes of their airspace.

While China is interested in using the Northern Sea Route, Lajeunesse points out that the passage’s viability is sometimes overstated. “While the Chinese are interested in using it, it really is interest rather than enthusiasm,” he said. “Ice conditions are still difficult, and Russian fees and regulations have been cited by Chinese companies as a major hurdle to large-scale adoption.”

 

[IndianHawk]

But the problem is India custom can't deny them entry forever, which means sooner or later, India has to open the door.

Bulk of item exportable by train will be made of low cost manufacturing items base for which is already shifting to India . In 6-8 years India can reduce its dependenc of china in these items such as toys , mobile , small electric items.

Bigger items such as heavy equipment will anyway be transported from sea.

 

[AmoghaVarsha]

But the problem is India custom can't deny them entry forever, which means sooner or later, India has to open the door.

Yes they can.India can deny entry to anything into its borders.

 

[JohnX]

‘Best time in history’ for China-Russia relationship: Xi and Putin boost ties: OBOR

Russia-China RMB Cooperation Fund are expected to be invested in infrastructure projects linked to China's "One Belt, One Road" (OBOR)

https://uk.finance.yahoo.com/news/apos-best-time-history-apos-030500900.html


Strategic ties between Russia and China were appraised in glowing terms as Chinese President Xi Jinping wrapped up a two-day state visit to Russia, concluding with at least $10 billion in agreements.

Xi, who met with Russian President Vladimir Putin during the trip, told Russian media that relations between the two countries were currently at their "best time in history." The Chinese president also said Russia and China were each other's "most trustworthy strategic partners," Xinhua reported.

"China-Russia relations do appear to be smooth right now, but relations between those two major power neighbors have had a long history of ups and downs," said Ja Ian Chong, an associate professor at the National University of Singapore, adding that changes in the nature of that relationship can be sudden and dramatic.

One impetus for the ramp up in diplomatic cooperation could be developments in U.S. foreign policy.

"The fact that the U.S. seems far less systematic in its foreign policy than in the past creates space for China and Russia to make the best of the situation," Chong told CNBC.

Hugo Brennan, Asia analyst at Verisk Maplecroft, added that President Donald Trump's approach to foreign policy was more likely to foster alignment between Beijing and Moscow than it was to thrust a wedge between the two.

Aside from the reiteration of closer strategic ties between the states, other issues discussed during Xi's visit included the deepening of economic linkages and security concerns.


Signed into agreement on Tuesday, funds from the Russia-China RMB Cooperation Fund are expected to be invested in infrastructure projects linked to China's "One Belt, One Road" (OBOR) initiative and the Eurasian Economic Union ー a trading bloc championed by Putin. Russian state media said the investment fund was an agreement between the Russian Direct Investment Fund sovereign wealth fund and the China Development Bank.

Another agreement worth 6 billion yuan ($882.35 million) between VEB — a Russian state development bank — and the CDB was signed on Tuesday, Reuters reported. The funds are expected to be channeled into areas such as the development of blockchain innovations, Reuters said.

Despite the declarations of friendship and what Xi called his "close personal friendship" with Putin, pressure points continue to exist in the China-Russia relationship, experts said.


"China's increasing influence in Russia's traditional sphere of influence is a notable pressure point in Sino-Russian relations. Beijing often has competing, if not conflicting, objectives with Moscow in Central Asia," Brennan told CNBC in an email.


For now, both countries remained in agreement. In a joint statement after North Korea's missile launch on Tuesday, both China and Russia called for a freeze on missile tests from the hermit state. Foreign ministers from both countries also said that the U.S. and South Korea should abstain from carrying out joint exercises.

Xi and Putin had earlier voiced their objection to the deployment of a U.S. anti-missile system in South Korea as a means of defense against North Korea . The deployment of Terminal High Altitude Area Defense (THAAD) in South Korea "seriously undermines the strategic security interests of China," Xinhua quoted Xi as saying on Monday.

Following the conclusion of the bilateral meeting, Xi and Putin are set to attend the G20 summit convening in Hamburg, Germany on July 7.

 

[JohnX]

Thinking multilateral: OBOR/One Belt, One road (OBOR)/Belt and Road Forum (BRF):

http://www.thehindu.com/opinion/op-ed/thinking-multilateral/article19225908.ece

India has sent conflicting signals through its approach to three recent events
The last two months have been an eventful period in India’s foreign policy engagements. The culmination of three events — One Belt, One road (OBOR)/Belt and Road Forum (BRF), Shangri-La Dialogue and Shanghai Cooperation Organisation (SCO) meet — saw high-level exchanges among countries of the Asia-Pacific region. However, India’s different responses to the three events point to complexities that might hinder its approach.

The first event, the BRF held in Beijing, was attended by 29 heads of states, more than 100 senior government officials and 70 international organisations. New Delhi, critical of the China-Pakistan Economic Corridor (CPEC), chose not to attend. It thus sent a strong political signal of its discomfiture to the leaderships of both China and Pakistan.

When it comes to the annual Shangri-La Dialogue, which brings together Defence Ministers and other high-level officials from 28 nations in the Asia-Pacific, India has attended 12 out of 16 meets since its inception in 2002. This year though, India was conspicuous by its absence, which was due to a combination of factors — late confirmation from New Delhi’s end and a ‘programme oversight’ by the organisers. Finance Minister Arun Jaitley, also additionally holding the portfolio of defence, was hard-pressed for time and Minister of State Subhash Bhamre was deputed to head the Indian delegation. India decided to pull out when he was told to attend one of the ‘plenary sessions’ and not given a speaking role at the main session.

It missed out on an important avenue to put across its views due to the absence of a full-time Defence Minister. That said, New Delhi could have sent a suitable delegation instead as was done by China and Pakistan. Chinese delegation, led by Lt. Gen. Le Hei, raised several issues like U.S. arms sale to Taiwan, navigation in the South China Sea and Korean peninsula nuclear issue. On a related note, India is working on its own version of multilateral dialogue forums. The ‘Raisina Dialogue’ and ‘Gateway of India Dialogue’ have celebrated two successful editions. India may be keen not to give too much importance to other similar forums.

The third engagement was at the SCO, which India and Pakistan joined on June 9 after having remained observer states for several years. Speaking at the summit in Astana, Prime Minister Narendra Modi expressed his desire for enhanced connectivity and trade exchanges and also pledged his commitment in the collective fight against terrorism. The SCO will be India’s wedge to make inroads into Central Asia.

The Indian government has invested significant diplomatic capital in bilateral engagements. However, regional multilateral engagements are equally important, given the commonality of threats and the Indian leadership should actively participate in them. They also provide avenues for bilateral discussions on the sidelines. Until any platform disregards India’s ‘core interests’, New Delhi should consider attending similar high-level engagements in the future.

 

[lcafanboy]

Pakistan China's new colony? Leaked papers reveal Beijing's stake in economy, key projects
Leaked documents reveal China's plans to gain a controlling stake in large swathes of Pakistan's economy, from farms and textiles to power projects, even the stock exchange.

Ananth Krishnan
July 20, 2017 | UPDATED 19:35 IST

Click here to Enlarge


THE TAKEOVER BLUEPRINT

CPEC will usher in an even more sweeping takeover of the Pakistani economy. A draft masterplan says thousands of acres of Pakistani land will be transferred to Chinese companies to grow crops, build meat processing plants and develop free trade zones. Chinese garment factories will, en masse, be transferred to Pakistan, while China will manage and run tourism projects and special economic zones along the southern coast, with rather ambitious plans for even yacht clubs and hot spring hotels to develop an unlikely tourism hub in the restive Balochistan province, of all places.

"There are fears that Pakistan will become just another province of China, or will be reduced to being a 'vassal state'," S. Akbar Zaidi, a leading Pakistani political economist and professor at Columbia University's School of International and Public Affairs, has argued in a paper.

For Beijing, the stakes are high. The internal assessment by Renmin University's Chongyang Institute for Financial Studies, which sent scholars to visit Pakistan and study CPEC projects late last year, warned of numerous risks, from political infighting in Pakistan to terrorism. The report, however, came to the final conclusion that the only way for China to guarantee success is to assume even more sweeping control.

'Neither China nor Pakistan can afford the consequences of the failure of constructing the corridor,' the Chinese report concluded. 'If the current uncertainty was to continue, it would not only delay the opening of the flagship project but CPEC would end up becoming a burden on China and have a great negative impact,' it said, of President Xi Jinping's pet One Belt, One Road (OBOR) initiative.

The most surprising aspect of the draft masterplan is its revelation of the wide ambit of conceived projects. Previously, CPEC was thought to be limited to power and infrastructure projects in Pakistan. The $46 billion cited estimate of the total initiative envisages $11 billion investment in highways and transport networks, and $35 billion in coal and hydropower plants aimed at tackling Pakistan's energy deficit.

The draft plan, however, reveals that CPEC will eventually be far more sweeping than power plants and roads: it envisages a complete takeover of almost every aspect of the Pakistani economy. Agriculture, surprisingly, is the focus. Around 6,500 acres will be leased to China for agricultural demonstration projects, the masterplan draft says. It lists 17 projects, including a fertiliser plant with an annual 800,000 tonne output. Vegetable and grain processing plants with a 1 million tonne capacity have also been planned.

Power projects that will cut Pakistan's soaring energy deficit are also central to the plan. China has announced 17 projects with a total investment of $35 billion. The first of these, a coal-powered plant at Sahiwal in the Punjab, went online in May. Pakistan suffers an energy deficit of around 7 GW, with a capacity of 22 GW that, however, only produces around 12 GW a year. The total energy from China's projects, once they go online in the next few years, is an estimated 12.1 GW, which China says will end up bridging Pakistan's energy gap and ultimately contribute between 40 and 50 per cent of the country's energy needs. In addition to this, the Chinese are planning to overhaul Pakistan's road and rail infrastructure. Apart from upgrading the Karakoram highway that will serve as a key arterial link connecting Xinjiang and Gwadar, it is already being used to ship goods transported from Xinjiang by road, by sea to West Asia-China is also revamping the country's crumbling national highway and railway network, starting with upgrading sections of the Karachi-Peshawar road and rail line.

The under-construction Orange Line metro at Lahore

Trucks carrying goods during the opening of the Kashgar-Gwadar trade route


THE XINJIANG MODEL

Essentially, the 'Xinjiang model' will be adopted in Pakistan. In the 1950s, Mao set up the Xinjiang Production and Construction Corps (XPCC), a state within a state tasked with carrying out agriculture and development projects in what was then China's wild west. The CPEC plan even conceives of a role for the XPCC. 'We will impart advanced planting and breeding techniques to peasant households or farmers by means of land acquisition by the government, renting to China-invested enterprises and building planting and breeding bases,' it says.

'China-invested enterprises will establish factories to produce fertilisers, pesticides, vaccines and feedstuffs' while 'China-invested enterprises will, in the form of joint ventures, shareholding or acquisition, cooperate with local enterprises of Pakistan to build a three-level warehousing system (purchase and storage warehouse, transit warehouse and port warehouse)'. China will even construct a national storage network of warehouses for Pakistan, starting in Islamabad and Gwadar and then in Karachi, Lahore and Peshawar.

The draft also outlines a move to transport China's waning textile industry, currently grappling with rising wages, to Pakistan. As a start, a cotton processing plant with a 100,000 tonne output has been planned. The longer-term plan, Renmin University's assessment suggests, is 'shifting China's garment industries directly to Pakistan'. Beyond the lower wages and availability of land, China sees the favourable export tariffs Pakistan enjoys as a motivation.

'With Pakistan in 2015 acquiring duty-free access to the EU even as China's tariffs increased from 9 to 12 per cent, this is worth considering,' the study advises. China is also planning to develop Pakistan's mineral resources, particularly in Balochistan and Khyber-Pakhtunkhwa, eyeing gold reserves as well as setting up marble and granite processing sites.

HEART OF THE PLAN

Gwadar, a dusty town of less than a hundred thousand people that sits on the Arabian Sea in Balochistan, is the CPEC hub. China has already built a port here that it is managing. Beyond the port, which will give China access to the Indian Ocean, it envisages a free trade zone and manufacturing hub that could serve as a launch pad for exports to West Asia and Africa. China has already secured a 23-year tax-free deal for its companies that will operate out of Gwadar.

The CPEC masterplan rather ambitiously even envisages a coastal tourism belt in restive Balochistan, planning 'international cruise clubs' in Gwadar that would 'provide marine tourists private rooms that would feel as though they were "living in the ocean''.' A coastal tourism zone will feature 'yacht wharfs, cruise homeports, nightlife, city parks, public squares, theatres, golf courses and spas, hot spring hotels and water sports', the Dawn report noted, running all the way to the Iran border.

China sees the Gwadar port as the heart of the plan. The Renmin University study forecasts an ambitious annual cargo throughput of 300-400 million tonnes, more than 10 times Pakistan's current biggest port, Karachi, and, the study pointedly adds, almost equivalent to India's total current throughput. The university's researchers found that Gwadar, still nowhere close to capacity, had been transformed under Chinese management. In February 2013, the China Overseas Port Holdings Limited acquired the rights to operate the port from the Singapore Port Authority, which left the port in a state of ruin, 'filled with rubbish and garbage', until the Chinese took over. Since then, a first shipping route was opened by the Chinese state-run Shipping Ocean Company (COSCO) in May 2015 exporting local seafood to Dubai. In November, the first CPEC export was flagged, as a convoy carrying 60 containers of a range of Chinese goods, from machinery to appliances, to be exported to West Asia and Africa, arrived in Gwadar after travelling 3,000 kilometres from Xinjiang along the Karakoram highway.

SECURITY FEARS

China is certainly more than aware that a lot can go wrong with this ambitious economic blueprint in one of the world's most volatile regions. A significant portion of the Renmin University assessment was devoted to assessing risks, the biggest of which, in the Chinese view, is Pakistan's unpredictable domestic political environment. For instance, it cited a project in Sindh that faced a lack of support from the local government. 'The project is ratified by the federal government but the Sindh government believes the centre does not have the authority,' it said. The report also noted the heated controversy between states over the CPEC's alignment, with widespread resentment that Punjab, where Prime Minister Nawaz Sharif and his brother Shahbaz, the chief minister, are dominant figures, was acquiring prime projects.

The Chinese study warned of 'ethnic and provincial conflicts in Punjab, Sindh and Balochistan', but was optimistic that most provinces and parties were supportive as 'except Balochistan no other ethnic group party opposes CPEC'. The report concluded that a government under Nawaz Sharif would ensure the project's progress, expressing concern about his weakening domestic position after the Panama Papers revelations. 'If there are no exceptions, the chances for PML-N (Sharif's party) to reassume power are high, and the continuation of the government can guarantee the continuation and support of the government to CPEC,' the report said.

Security is the other major concern, highlighted by the kidnapping and reported killing of two young Chinese from Quetta, Balochistan, in May. The Chinese study cited a number of other incidents that had targeted its citizens in 2016. In May, a Chinese engineer at the Kazmu project was targeted by a bomb attack claimed by an outfit called the Sindh Revolutionary Force. Two months later, a bomb attack in Quetta killed 74 people, while in November last year, a team from a Chinese oil and natural gas exploration company was targeted in an attack by a group called the Baloch Revolutionary Army in which two Pakistani security personnel killed.

The Pakistan army has deployed a special security division of 15,000 troops to protect Chinese personnel and assets, but the report argued that 'a troop size of 15,000 can hardly guarantee the safety of projects around the country.... And considering that Pakistan needs to deploy a large number of troops in its eastern borders adjoining India and now needs to deploy troops in Afghan border, allocating 15,000 is the largest capacity.' The wider concern was because of security, Chinese staff in Gwadar, for instance, will have to be 'cloistered within the Chinese zone as the situation around the city is not stable'. The Chinese report worried this will alienate the local population because 'Chinese personnel are carrying out work under the protection of armed forces and this inhibits improving relations with local people to the extent that it could lead to opposition and lack of people's support'.

Chalay Thay Saath, the first Pak-China romantic story


FINANCIAL RISKS

Then there are the financial hazards. China's exposure, so far, is much less than the advertised $46 billion figure, with estimates that in the past three years, its total investments would be in the $5 billion range, spent largely on coal power projects that are being built, the widening of the Karakoram highway and sections of the Karachi-Peshawar expressway.

Chinese assessments suggest the $46 billion figure that Pakistani officials regularly cite may not materialise for a long time yet. The CPEC draft masterplan from China's planning agency noted, as the Dawn reported, that 'Pakistan's economy cannot absorb FDI much above $2 billion per year without giving rise to stresses in its economy....It is recommended that China's maximum annual direct investment in Pakistan should be around $1 billion'-a damning reality check to fanciful figures of $50 billion being invested in the country.

For some in Pakistan, the long-term fear is that this blueprint will, as economist Zaidi notes, render it a 'vassal state' deep in China's economic orbit. After one year of the project, bilateral trade was up 15 per cent to $13.77 billion in 2015-16, while Pakistan's trade deficit with China was a whopping $12 billion. There are already murmurs of discontent about the favourable terms for Chinese companies.

"Estimates range from Pakistan having to pay $3 to $3.5 billion annually back to China for the next 30 years for Chinese loans after 2020, to a probable severe balance of payments crisis," argues Zaidi, noting how in Sri Lanka and Tajikistan, "with rising costs and debts incurred by the host countries, large chunks of land were handed over to the Chinese in lieu of unpaid funds. Sovereign guarantees to Chinese power producers have been made, where the Pakistan government will, 'if the power purchaser defaults on payments, pick up the liability and pay 22 per cent of the bills of Chinese power producers upfront'". As he puts it, "CPEC is a Chinese project, for Chinese interests." And Pakistan, he says, just happens to be part of the geographical terrain.

IMPLICATIONS FOR INDIA

What does it mean for India? On May 13 this year, India refused to participate in China's Belt and Road with a strongly-worded statement. "No country can accept a project that ignores its core concerns on sovereignty and territorial integrity," MEA spokesperson Gopal Baglay said. OBOR passing through Pakistan-occupied Kashmir is the primary reason New Delhi boycotted the project. For long, India has held the Kashmir issue as a bilateral dispute with Pakistan, with no room for outside intervention. China has now willy-nilly become a party to it. "Since CPEC was announced, Pakistan has stepped up its activities inside Kashmir. Funding to separatist elements has increased," says Jayadeva Ranade, former additional secretary in the Research and Analysis Wing (R&AW). The presence of Chinese personnel within Pakistan is something India must take into account in the event of hostilities, he says.

For instance, China and Pakistan have begun joint patrols in PoK near the Xinjiang border, Chinese media reports have said. Even as China now lambasts India as a "third party" with a "hidden agenda" for "intervening" in its dispute on the Doklam plateau with Bhutan, Beijing has quietly deployed its frontier troops on the soil of PoK, which India considers its territory. In the event of an Indo-Pak conflict, Indian officials do not expect China to intervene directly, but the infrastructure it is laying down in PoK can be used to back Pakistan with massive logistics support.

The larger concern is that collusion between the two countries is now assuming sinister dimensions. Gwadar is likely to become China's second overseas naval base after Djibouti near the Gulf of Aden. The port also sits astride the sea routes from where more than 55 per cent of India's energy needs flow in. China's clandestine backing of Pakistan goes back decades starting from the alleged transfer of nuclear weapon blueprints in the early 1980s. The 2016 sale of eight Yuan class submarines to Pakistan not only attempts to checkmate the Indian navy in its backyard, but adds another nuclear dimension. Pakistan is now working to equip them with nuclear-tipped variants of the Chinese 'Babur' land attack cruise missiles.

Then there is the diplomatic protection China offers Pakistan, which some in Delhi believe is emboldening Islamabad to hurt Indian interests. In the past, Beijing had largely kept away from issues such as the Kashmir dispute. That caution is now giving way to what some see as an open backing of Pakistan. This was evident in Beijing issuing stapled visas to Indian residents of Jammu & Kashmir-which subsequently ended after India stopped defence exchanges-even while it opened the door to Pakistani residents from Gilgit-Baltistan to freely cross the border into Xinjiang to open up trading offices in Kashgar, where ironically India had a consulate and trading presence until 1950.

This renewed China-Pakistan nexus has once again begun to cast a shadow on India's relations with China. In two issues that have recently strained relations-China's blocking of India's attempts to sanction the Pakistani terrorist Masood Azhar at the United Nations Security Council 1267 sanctions committee and India's failed entry to the Nuclear Suppliers Group-the Pakistan factor has loomed large in China's calculus. Beijing in 2016 stymied the bid to sanction Azhar, and once again in January placed another 'technical hold' on a fresh application backed by the US, UK and France. On the NSG, Beijing's officials have openly said that "other non-NPT countries" (those that have not signed the nuclear non-proliferation treaty) besides India also had legitimate aspirations to join the grouping, referring to Pakistan. Chinese nuclear negotiators pointedly visited Islamabad after talks in Delhi to underline how Beijing is linking India and Pakistan, despite the impeccable non-proliferation record of the former and the questionable track record of the latter. As Beijing further deepens its economic and strategic embrace with its 'iron brother', its relations with India are set to undergo a transformative shift. And for Delhi, confronting this renewed China-Pakistan nexus has become perhaps the most pressing diplomatic and military challenge.

http://indiatoday.intoday.in/video/china-pakistan-relations-cpec-obor-pok/1/1007928.html

http://indiatoday.intoday.in/story/...mplication-for-india-cpec-obor/1/1006432.html

 

[lcafanboy]

Pakistani Crying on Iron Friend China Refused Pakistan for any Loan other than CPEC


Honeymoon is over........

 

[Hiranyaksha]

All these freights and logistics corridors initiated by China does not make much economic sense. With Chinese goods facing stern competition in international market in both cost and quality front, if you add high logistics cost via land route, figures do not add well ( assuming chinese will pay for the natural resources extracted from Pakistan and will not have slaves working from them).