China agrees to bail out cash-strapped Pak
Vows 'necessary support'; inks 16 pacts with Pak PM led team
BY: K J M Varma
Beijing: China said it will provide the “necessary support” to Pakistan to tide over the present financial crisis, expand CPEC projects as the two countries signed 16 agreements on Saturday after talks between Prime Minister Imran Khan and his Chinese counterpart Li Keqiang to boost their “all-weather” strategic ties.
Khan is here on his maiden visit to China as the two countries grapple to iron out differences over the multi-billion-dollar China-Pakistan Economic Corridor (CPEC) and Islamabad approaching ‘friendly nations’ to avoid a tough IMF bailout package.
In his meeting with Chinese President Xi Jinping on Friday, Khan in a candid admission said “unfortunately, our country is going through a low point at the moment with two very big deficits, a fiscal deficit and a current account deficit”.
Li, who held a ceremonial welcome for Khan, said “we have a high-level of political trust and close cooperation in all fields. Pakistan has always been regarded as a foreign policy priority by China”.
Thanking Li, Khan said: “the relationship between the two countries has deepened since then because the CPEC in 2013 was just an idea. Now it is on the ground. And it has caught the imagination of the people of Pakistan”.
Pakistan sees China as a great opportunity to progress, attract investment, he said.
Once a CPEC critic during the previous Nawaz Sharif government, Khan said: the CPEC “gives us an opportunity to raise our standard of living, growth rate. You will see the difference because a lot has happened since 2013”.
After he became Prime Minister, China had agreed to address his concerns to build more projects with focus on the western region of Balochistan and Khyber-Pakhtunkhwa.
The CPEC has also become a major irritant in India-China relations with New Delhi voicing its opposition to the infrastructure project as it traverses through Pakistan-occupied Kashmir.
After talks between Khan and Li, officials of both the sides signed 16 agreements mainly relating to poverty alleviation in Pakistan, strengthening cooperation in agriculture and industrial sectors and technical training.
China has not confirmed reports that it would provide USD 6 billion to Pakistan.
Pakistan has already approached the International Monetary Fund (IMF) for a bailout package. But Khan wants to minimise IMF loans fearing stringent conditions and scrutiny of the CPEC projects.
Vice Foreign Minister Kong Xuanyou, who briefed the media after Li-Khan talks, said China will provide “necessary support” to Pakistan to tide over the present financial crisis but declined to reveal the amount.
Pakistan media reports said Friday that Beijing will provide USD 6 billion in aid to Islamabad which included a loan of USD 1.5 billion along with an additional package of USD 3 billion for the CPEC.
Asked about the USD 6 billion package, Kong said: “during the visit, the two sides made it clear in principle that the Chinese government will provide necessary support for Pakistan to tide over the current difficulties with in its capacity”.
“As for the specific measures to be taken, the competent authorities will have detailed discussion”, he said, hinting that more talks will follow.
He also said there will be no changes in the USD 60 billion CPEC projects which came under criticism including by some of the Khan’s Cabinet ministers over the increasing debt.
Pakistan is currently battling serious economic crisis including balance of payments.
China also wants to promote more special economic zones, he said.
“There has been no change in the number of CPEC projects. If there is going to be any, it will be increased going forward,” Kong said replying to a question.
He also said more projects relating to “industrial cooperation” will come up in more areas of Pakistan.
“The dimension of the industrial cooperation will be introduced into the CPEC going forward. The CPEC will be introduced to more areas of Pakistan and we are also in favour of areas relating to people’s lives and hence going forward both the areas and the contents of the CPEC will be enriched,” Kong said.
The two sides firmly move forward the CPEC, while ensuring the smooth operations of the completed projects and advancing the ongoing projects, he said.
Both the countries will gradually bring the industrial cooperation for the CPEC, extend it to other parts of Pakistan and make it appropriate for people’s lives, Kong said.
“Both sides have agreed to establish a foreign-ministerial dialogue mechanism to make overall planning and coordinate in various fields,” Kong said besides establishing a working group on social and livelihood affairs under the the CPEC joint cooperation.
Asked about the cooperation on counter-terrorism, Kong said: “all areas of cooperation have been covered and we also expressed positive wish for strengthening cooperation”.
China has been pressing Pakistan to crackdown on Uygur militants of the East Turkistan Islamic Movement (ETIM) in Xinjiang region from crossing in and out of the province. (PTI)