GG News Bureau
Beijing, 12th September. Xi Jinping’s dream of expanding China’s cultural and military might is beginning to loosen. China considered reviving its ancient silk road as part of the ambitious Belt and Road Initiative, which was launched in 2013. The plan was to construct a global infrastructure network in and around 150 countries that would connect China. The Covid pandemic, on the other hand, completely shattered the dream. Economic breakdowns caused by the lockdown, the Ukraine war, and anti-China sentiment around the world have stymied almost every project. One of the most important parts of the BRI appears to be the China Pakistan Economic Corridor (CPEC).
China has abandoned a critical power project in Pakistan
According to recent reports, Chinese engineers and personnel have abandoned the repair of the 969-megawatt Neelum-Jhelum Hydropower Plan project in Pakistan-occupied Kashmir. According to reports, Pakistan has shut down the operation since July 2022 due to a lack of fuel and electricity.
China stated in its withdrawal statement that due to local protests over the plant, Pakistan was unable to provide adequate security cover to the Chinese engineers involved in the project.
Gezhoiuba Group, a Chinese consortium, began construction on the project in 2008. After years of delay, the first generator was turned on in April 2018, and the entire project was completed in August 2018.
The Neelum-Jhelum Hydro-project Plan, however, was shut down three years after its inception in July 2022 due to major cracks in the tailrace tunnel. Pakistani officials had complained about substandard construction quality, poor supervision and management by the Chinese as reasons for failure.
The departure of Chinese engineers from the project sparked a bitter blame game between China and Pakistan. On the one hand, Pakistan complained about China’s poor construction quality and its disregard for security protocols. China, on the other hand, expressed concern about security.
Furthermore, residents are protesting the project due to unequal power distribution, royalty, employment, and environmental concerns.
China’s Economy Is Collapsing
This recent dogfight between China and Pakistan has several causes. As both countries’ financial, economic, geopolitical, and security situations shifted, dark clouds began to form over the CPEC projects. Previously, Chinese authorities or firms have refused to collaborate with Pakistan on a number of projects.
Earlier in May 2022, more than 25 Chinese Independent Power Producers (IPPs) threatened to shut down all power in the CPEC projects. “The authorities were pressuring them to maximise generation to meet peak summer needs,” the IPPs said, “but this is impossible for us given serious liquidity issues.”
Whereas Pakistan is already on the verge of bankruptcy, China is also collapsing due to a constant covid outbreak. The Chinese economy, according to reports, has been strangled by the never-ending Covid spread and shutdown. According to the report, the harsh lockdown and the latest outbreak of the Chinese Virus impacted 54.4% of the national GDP and half of the population. In the first quarter of 2022, the country’s GDP increased by only 0.4%. The default of EMI payments and lower property buyouts have created a massive liquidity crisis in the real estate sector. Mortgage payments have become difficult for developers because home buyers have refused to pay and have organized a social boycott of EMI payments. The country is on the verge of bankruptcy due to the looming real estate sector, which accounts for 29% of China’s GDP. Not only has the economy’s production capacity ceased and its sources of income been reduced, but exports, which account for 18% of China’s GDP, are also declining.
In this situation, China has begun to feel economic consequences. Stagnant GDP growth and global anti-China sentiment have stymied the country’s economic recovery. Almost every multinational corporation has already moved its major manufacturing base away from China and into other countries, primarily India. The key economic base of manufacturing and exports on which China has relied appears to have crumbled. They now lack the funds to carry out their dream of a BRI or CPEC project.
CPEC: Breaking the Chinese Dream
Furthermore, the Balochistan Liberation Army, an organization of freedom groups seeking to liberate Pakistan’s Balochistan province from the federation, is constantly targeting both the Pakistani army and Chinese workers involved in the CPEC project. The BLA claim that they are being evicted from their ancestral land as a result of this project and are not being properly rehabilitated.
In this scenario, many Chinese engineers and workers have refused to work on CPEC projects. Furthermore, several key CPEC infrastructure projects were washed away in the recent flood.
CPEC is also on hold as the United States has recently resumed its involvement in Pakistan. The United States recently announced USD 30 million in aid to Pakistan. The Biden Administration also announced a USD 450 million F-16 fleet sustainment programme for Pakistan earlier this week. China is irritated by the growing friendship between the United States and Pakistan. As China and the United States are currently engaged in one of the most ferocious cold wars in the Indo-Pacific, Pakistan’s proximity to America will undoubtedly harm China. In this situation, China will almost certainly force Pakistan to participate in CPEC.
Many questions have been raised as a result of the growing financial, geopolitical, and security concerns surrounding China and Pakistan. Will the $60 billion infrastructure network connecting the CPEC project be Chinese President Xi Jinping’s unfulfilled dream? Will China’s goal of reviving the old Silk Road remain a pipe dream? The formal announcement of the failed project will take time, but the facts and circumstances surrounding it suggest that before the CPEC linking project reaches the Gwadar port in the Arabian Sea, Xi Jinping’s dream has already reached the sea’s deep trenches.
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