China rejects Pak’s bid for new Belt and Road projects 

According to the minutes of a high-level discussion between the neighbouring countries, China rejected requests to engage in new Belt and Road projects in Pakistan. Experts attribute this decision mostly to the unpredictable political climate and poor security that plague Islamabad.

According to two officials who have seen the recordings of the meeting and spoke to Nikkei Asia, a Japanese newspaper, the Chinese side rejected Pakistan’s requests to include additional projects under the China-Pakistan Economic Corridor (CPEC), the $50 billion Pakistani component of the Belt and Road, in the areas of energy, climate change, electricity transmission lines, and tourism.

Chinese officials turn down Pakistan’s request for new BRI projects:

The minutes also show that Beijing rejected Islamabad’s request to construct a 500 kilovolt transmission line connecting Karachi to the national electrical grid in order to link the southern port of Gwadar, a target of Chinese infrastructure investment. Beijing also persuaded Pakistan to suspend its protests against a 300 megawatt coal-fired power facility in Gwadar that Islamabad wanted to relocate to a place where homegrown coal could be utilised rather than imported coal.

The Joint Cooperation Committee (JCC), the principal decision-making body for CPEC, held its 11th meeting in October of last year, although the minutes weren’t formally accepted until July. Chinese reluctance to expand its footprint in Pakistan was also underlined in local media reports, which the officials confirmed.

Pakistan’s Stance:

Pakistan’s Ministry of Planning and Development responded to these accusations by downplaying Beijing’s aloofness and asserting that “China and Pakistan are committed to expanding the scope of [CPEC] to include new areas of cooperation, such as water resources management, climate change, and tourism.”

Since previous Prime Minister Imran Khan’s administration was overthrown in April 2022, which led to numerous instances of civil unrest, Pakistan has been experiencing political turbulence. Activists have moreover frequently targeted Chinese interests in recent years, including an August ambush on engineers that security forces prevented. Terrorists carried off two deadly suicide attacks last week, highlighting the general deterioration of Pakistan’s security situation.

Pakistan has established itself as a hotspot of social unrest and violence, according to Jeremy Garlick, associate professor of international relations at Prague University of Economics and Business.

For geopolitical reasons, China needs Pakistan as a partner, but the Chinese are hesitant to invest more money than is necessary, the expert claimed.

According to James M. Dorsey, a senior fellow at the S. Rajaratnam School of International Studies in Singapore, the increasing violence in Pakistan has negatively impacted the environment for investments. According to Dorsey, “Chinese believe that security of their personnel and assets is in jeopardy in Pakistan.” 

Local media reports that Pakistan has agreed to increase security for Chinese workers working in CPEC projects. For example, all Chinese workers must travel in bulletproof automobiles. However, observers argue that Beijing has additional reasons for disliking what it observes in Pakistan.

Beijing appears to grow picky, particularly at a time when its own economy is slowing down, as China commemorates the Belt and Road Initiative’s 10th anniversary. The initiative is a vast effort on the part of Beijing to increase its influence and create infrastructure that stretches from Asia to Europe and Africa.

According to Andy Mok, a senior research fellow at the Centre for China and Globalisation, a Beijing think tank, “Like any investment process, China is adapting its BRI investment process based on experience and a deeper understanding of how to more effectively align investments with strategic objectives.China’s approach to Belt and Road investments is guided by prudence and long-term sustainability. Concerns like political instability in partner countries like Pakistan necessitate greater caution, especially regarding the safety of Chinese nationals,” Mok added. “In the midst of global and domestic challenges, aligning investments closely with China’s strategic interests is essential for the initiative’s long-term success.”

The long-overdue debts of Pakistan:

The University of Virginia’s Muhammad Tayyab Safdar, an assistant professor of global studies, cited $1.2 billion in past-due payments to Chinese electricity companies. Due to a severe cash deficit, Pakistan has had trouble making payments to them.

Safdar predicted that “[the Chinese] will still make money, but with much angst, at least in the power sector.”

The Chinese government, according to Garlick, “does not believe anymore that it can get economic returns from CPEC.” He believes that China’s delayed investment pattern and reluctance to lend more money demonstrate that Beijing does not see the CPEC as a catalyst for regional or national economic growth.

Cheema, the analyst in Islamabad, indicated that this was conceivable because the 240 million-plus South Asian country is too significant to be ignored. According to Cheema, China is “making Pakistan realise that its part of the bargain must be fulfilled to win investors’ confidence,” and Beijing may decide to invest more if a new government with a new mandate is elected in Islamabad.

Pakistan has demonstrated that it is a political entity that is intrinsically unstable, he said. The Beijing administration has had enough experience over the years to understand that Pakistan’s potential for stability and consistent economic growth are dim.