How Cooperation with China affects the ordinary people of Pakistan?

Ulvi Ahmedli is Baku Based Research Journalist who has specialization in Regional Affairs and Economy.

By Ulvi Ahmedli

China is a key player in the Asian economy which is the main initiators of huge projects worth billions. Pakistan has a special role in the investment policy of China with its geostrategic position.

Most specialists and governmental officials consider China as a reliable partner and a country which respects the soul of partnership. China is known as a country to play a win-win game. China proposed a huge investment project Belt and Road Initiatives (BRI) covering the enhancement of partnership and connectivity. 71 countries participate in BRI currently embracing 6 main projects.

China-Pakistan Economic Corridor (CPEC) is one of the main projects among the 6 BRI’s projects. The total value of Chinese investment on CPEC estimated $46 billion currently and planned to be increased to $62 billion. It is expected that the investment will cross $100 billion until 2030.

The numbers are high and it is not hard to think about the contribution of the project to the Pakistani economy. The article covers the benefits of the Chinese investment on ordinary citizens of Pakistan in terms of the benefits of Foreign Direct Investment.

Foreign Direct Investments benefits countries in order to fight unemployment, poverty; strengthening international trade; improving human resources.

Fight against unemployment and poverty

Huge investment is made within CPEC on Pakistan. In turn of the projects, new opportunities will be opened for the citizens of Pakistan which will lead to the reduction of unemployment and poverty.

CPEC project provided 75,000 job opportunities for local people, according to Chinese Embassy documents. Apart from this, 700,000 new jobs opportunities will be created until 2030. As well as, CPEC Centre of Excellence, Ministry of Planning, Development and Reform of Pakistan estimated that CPEC will indirectly help the creation of 1.2 million jobs for Pakistani people.

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The unemployment rate in Pakistan hits high in 2013 with 6.2% but year by year it declined to 5.79 % in 2018. The numbers show hope for reducing unemployment in future years. We should note that CPEC started in 2013 and the numbers show how the period results in terms of unemployment rates.

Reducing unemployment also affects the poverty rate. According to World Bank reports, the poverty rate (people lives below the National Poverty Line) was 64% during 2001-2002, but in 2014 it was 29.5%.

The statistics allow us to speak about the bright future for Pakistan. If the government can keep the development line as it goes, we can witness more positive results.

Human resources development

Reducing poverty and unemployment is not the only benefit for Pakistani people by CPEC. China offers education opportunities, scholarships for Pakistani students. During the last five years, the number of Pakistani students in China has risen to 22,000 from 5,000. Pakistani students are the third largest group of foreign students after South Korea and Thailand in 2018.

Now, Pakistan has an opportunity to develop its country by using the brains of young people who studied in China and got high education. This model proved itself positively in the development of Japan. As many knows, WWII left ruins and crisis to Japan but education saved the country even having no significant resources.

Pakistani people can benefit from the opportunities given by China for developing themselves and increasing abilities. This is one of the main goals of BRI.

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Transportation and Energy

Development of transportation routes and energy lines also improves the lifestyle of Pakistani people and reduces their hardships.

CPEC plans to build energy plants and power stations in regions. This will help the energy problem of people. This would be another benefit for Pakistani people. We should note that undeveloped regions of Pakistan will benefit from these projects. Balochistan is considered the most undeveloped regions. Coal-Fired Power Plant in Hub (capital of Balochistan) is expected to finish in August 2019. Coal power plant has already been built within the framework of CPEC in Gwadar. Generally, CPEC embraces the construction of 15 power plants.

The construction of roads, highways and railroads will provide people to join internal and foreign markets easily. By this way, they can bring their products to the markets better than before. CPEC covers internal and foreign transport lines.

The development of transportation infrastructure motivates economic growth and social welfare. It leads to the industrialization reduces transport costs.

 

Pakistan should use CPEC not only as an import tool but also it is recommended to use the opportunities of the corridor for exporting. China is a beneficial partner for Pakistan for developing economy but it doesn’t mean they can fully help Pakistan to survive from the economic crisis.

Using the opportunities of CPEC, modernizing industry will result positively to Pakistan’s economy. Pakistan receives funds by several states apart from China which can give an opportunity to open new jobs and other services for citizens.