Some Pakistani power firms stuck in slow lane on China’s Silk Road: HumSub.TV
Some Pakistani power firms stuck in slow lane on China’s Silk Road: HumSub.TV: Kamal Amjad Mian thought China’s decision to invest $36 billion in the Pakistani power sector would benefit his electricity cable business, and, anticipating increased demand, his family spent nearly $30 million on a second plant to double output.
But Mian’s Fast Cables and some other Pakistani manufacturers have yet to reap rewards from Beijing’s huge “One Belt, One Road” (OBOR) project, a modern-day “Silk Road” network of trade routes across land and sea.
Power stations built as part of the China-Pakistan Economic Corridor (CPEC), a $57-billion project involving energy, road, and rail infrastructure, are being kitted out with Chinese cables exempt from import duty and sales tax.
Such exemptions, more generous for CPEC projects than others, threaten to undermine local industry, according to Mian, one of a growing number of executives now questioning an initiative long portrayed as the key to Pakistan’s prosperity.
“The government, instead of giving us a level playing field, gave them an advantage,” Mian said in the eastern city of Lahore.
A Water and Power Ministry official, who declined to be named because he was not authorised to speak to the media, said, “there were question marks about whether the local cable industry could fulfil the demands under CPEC and we worried it would slow down projects.”
Beijing’s CPEC splurge and a drop in militant violence have reinvigorated Pakistan’s sluggish economy, driving growth to about 5 percent for the first time since 2008.
The public and political parties broadly support Chinese investment, while cement and steel companies who bagged early CPEC contracts are embarking on aggressive expansion.
But not everyone is happy. Critics say CPEC projects are opaque and expensive, and question Pakistan’s ability to repay the costs over time.
Some firms fear they will struggle to compete with Chinese companies with deeper pockets, economies of scale, and vastly cheaper credit lines.
“We have to make sure (CPEC) doesn’t become a Trojan Horse and start hurting existing industry,” said Ehsan Malik, chief executive of the Pakistan Business Council.
There is plenty still up for grabs for local players. The next phase of CPEC involves the creation of Special Economic Zones where Chinese state-run enterprises would open factories and help develop Pakistan’s industrial base.
But Fast Cables’ Mian said that, while domestic producers have been benefiting from broad economic growth, he fears his business will end up “dying a slow and painful death” if Chinese rivals setting up in Pakistan receive preferential tax breaks.
Mian and other cables makers are reviving a defunct industry association in order to lobby Islamabad, amid concerns Beijing will use its leverage over Pakistan to obtain those sweeteners.
“Very soon, if we are not nimble enough to recognise the issues, we could be in trouble,” said Fahd Chinoy, whose family runs Pakistan Cables.
“The dividend, the well-being delivered by the corridor will benefit the people of both China and Pakistan, as well as of the region,” Foreign Ministry spokeswoman Hua Chunying told a regular briefing when asked about concerns in Pakistan.
“We are not (so foolish) as to not protect our local industry,” said Miftah Ismail, a state minister charged with setting up CPEC Special Economic Zones.
“I want to assure people we will never give greater protection to our Chinese investing friends,” Ismail added. “It will never be an uneven playing field.”
The Pakistani government, citing local worries about being crowded out, said in January it would prioritise domestic companies over Chinese ones in the forthcoming sell-off of state-run companies.
Pakistan’s struggling textiles sector, which account for 60 percent of the country’s exports, is watching nervously.
China is offering vast incentives and ploughing billions of dollars into the Western region of Xinjiang to build a textile industry, which will rely on CPEC road and rail links to export goods via Pakistan’s Arabian sea port of Gwadar.
“If those products end up on the domestic market without duties, it will devastate the local industry,” said Aamir Fayyaz, chairman of the All Pakistan Textile Mills Association (APTMA).
Wang Zihai, president of the Pakistan-China Joint Chamber of Commerce and Industry, compared Pakistan to China three decades ago, when its nascent industries faced competition from more advanced Japanese and American companies.
“Chinese companies did not die,” Wang said. “Chinese are not here to take over everything, they want partners. They need a local party to work together.”
Husain Agha’s family-run steel business has bagged several CPEC contracts and is planning an Initial Public Offering (IPO) to raise cash to expand.
“Those who are geared for the economic renaissance of Pakistan will thrive, and those who are not will miss the bus,” said Agha, an executive director at Agha Steel Industries.
Some Pakistani power firms stuck in slow lane on China’s Silk Road: HumSub.TV. Some Pakistani power firms stuck in slow lane on China’s Silk Road: HumSub.TV. Some Pakistani power firms stuck in slow lane on China’s Silk Road: HumSub.TV. Some Pakistani power firms stuck in slow lane on China’s Silk Road: HumSub.TV.
About HumSub TV
Introduction
HumSub TV is Pakistan’s leading forwarding-thinking, edutainment channel, aimed at promoting and upholding peace, interfaith harmony and social responsibility within Pakistan through informative and insightful programmes and documentaries; analytical interviews on issues pertaining to social, economic, legal and environmental set-up; dedicated shows to canvass and thereby promote the culture and heritage of Pakistan and in-depth coverage of national and international news.
HumSub TV is the first channel and thus a pioneer within its own right that mainly focuses on emphasising the “Rights” as well as the “Obligations” of the citizens in light of the Constitution of Pakistan, numerous International declarations signed by the Government and various laws that have been promulgated over the years but are not in the knowledge of the common citizen.
HumSub TV also aims to enter into bilateral agreements with other countries to promote not only their culture, heritage and tourism, but also their educational and medical facilities.
Following the successful launch of HumSub TV’s head office in Blue Area, Islamabad; the bureau office has been set up in Lahore.
Vision
To project positive image building of Pakistan and inculcate nationalism, as per the vision of the founder of the nation, Quaid-e-Azam Mohammad Ali Jinnah.
Mission
HumSub TV is resolute about the promotion of a pluralistic, inclusive and egalitarian society in Pakistan where all citizens are allowed to contribute to promote interfaith harmony, peace and collective wisdom in the social, political and economic development of Pakistan and to encourage critical and lateral thinking in the society. HumSub TV strives to make a positive contribution to this end.
HumSub TV’s Theme
HumSub TV, Pakistan’s first EDUTAINMENT Channel, has been set up for not only those audience residing in Pakistan or overseas but the international community on the whole. The vision of the channel is to project positive image building of Pakistan and inculcate nationalism as per the vision of the founder of the nation.
HumSub TV strives to make a positive contribution to this end by promoting pluralism, inclusiveness and egality in Pakistan and give voice to the suppressed. It endeavors to act as a positive catalyst for social change and Pakistani nationalism. It envisions providing a platform for airing critical and lateral thinking and collective wisdom by inviting positive minded intellectuals and opinion forming individuals for the promotion of interfaith harmony and peace in the social, political and economic development of Pakistan.
Whereas the channel airs upbeat edutainment programmes, it, nonetheless, has the primary objective of countering negative anti-Pakistan regional and international propaganda as well as advancing fundamental rights as encapsulated in the Constitution of Pakistan.
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