- Also wants Islamabad to improve forex reserves, clear payments of IPPs and launch ML-1 in a phased manner on pilot basis and sort out concerns of Chinese financial institutions
It also asked Islamabad to improve forex reserves, clear payments of IPPs and launch ML-1 in a phased manner on pilot basis and sort out concerns of Chinese financial institutions, well-informed sources in the Ministry of Planning, Development and Special Initiatives told Business Recorder.
China had conveyed these demands weeks before a scheduled visit of Prime Minister Shehbaz Sharif to Beijing, intending to get maximum support for second phase of CPEC, budget FY 2024-25 support and convincing Chinese to reschedule debts of power projects, in addition to improving other components of bilateral relations.
Recently, Federal Minister for Planning, Development and Special Initiatives, Ahsan Iqbal and Special Assistant to the Prime Minister on Foreign Affairs, Syed Tariq Fatemi undertook an official visit to China wherein they interacted with different top officials of Chinese government including Vice Foreign Minister.
The Vice Foreign Minister hosted a working lunch and the head of National Energy Administration (NEA) hosted a banquet for the Pakistani delegation. Vice Chairman National Development and Reform commission (NDRC) held a detailed meeting; and detailed meetings were also held with Presidents of EXIM Bank and Sinosure.
According to sources, on ML-1 project, Chinese Vice Foreign Minister, Sun Weidong noted slow progress but acknowledged its strategic significance, adding that China wanted to make headway on a sustainable business model, and that there was a need to find out “good ways” to move forward.
It was mainly due to project’s high financial outlay as well as Pakistan’s overall debt profile and IMF conditions that the Chinese financial institutions were still evaluating the technical study of the project. He suggested that one of the ways was to implement the project in a phased manner on pilot basis.
On KKH Realignment Phase-II Project, Chinese Vice Foreign Minister said that both countries were committed to making the Khunjerab Pass an ’ all-weather strategic route’ for continued flow of goods and trade throughout the year.
He further stated that China was aware that with the development of Dasu and Diamer Bhasha dams, a certain portion of KKH could be submerged in water, hampering connectivity. In that context, KKH realignment project had attained greater significance. Accordingly, Chinese side had drafted and shared a Framework Agreement study. He also indicated that EXIM Bank could consider involvement of China Development Bank (CDB) to share financial cost of the project and expressed Bank’s readiness to engage in the Joint Financing Committee to finalise project’s financial terms.
He also conveyed EXIM Bank’s concerns over delayed payments to the Chinese IPPs, hampering financial approval of strategic projects, the low level of foreign exchange reserves and high risk to safety and security of the Chinese nationals working in Pakistan.
