ISLAMBABAD In a U-turn, Pakistan has announced that its close ally Saudi Arabia will not join the USD 50 billion China-Pakistan Economic Corridor, days after Islamabad said Riyadh will be the third “strategic partner” of China’s flagship project under the controversy-hit Belt and Road Initiative.
The CPEC is the flagship project of the multi-billion dollar Belt and Road Initiative (BRI), a pet project of President Xi Jinping aimed at enhancing Beijing’s influence around the world through China-funded infrastructure projects.
Minister for Planning and Development Khusro Bakhtiar told media on Tuesday that the cash-rich kingdom’s proposed investments would fall under a separate bilateral arrangement, Dawn news reported.
“Saudi Arabia is not to become a collateral strategic partner in the CPEC. This impression is not true,” he said.
A third country can participate in the China-Pakistan Economic Corridor (CPEC) by taking part in the business and investment ventures arising out of the project, Bakhtiar said.
“The framework between China and Pakistan is bilateral and Saudi Arabia is not entering that framework as a third-party investor, rather the base of the CPEC will be broadened and its pace will be expedited,” he said.
Last month, Information Minister Fawad Chaudhry said that Saudi Arabia is the third “strategic partner” of the CPEC, soon after Prime Minister Imran Khan returned from his first foreign trip to the kingdom.
Interestingly Chaudhry was sitting with Bakhtiar when he issued clarification that Saudi Arabia participation in the CPEC was not as third partner in the project.
Bakhtiar further said that there was no decision to bring a third country, like Saudi Arabia, under the framework of the CPEC.
He was responding to questions about the possibility of Saudi Arabia becoming part of the Joint Working Groups or Joint Coordination Committee on the CPEC.
Bakhtiar said there could be many offshoots of the CPEC where third countries could be involved in trilateral arrangement for infrastructure development, like China-Pakistan-Japan, China-Pakistan-Saudi Arabia or China-Pakistan-Germany.
Bakhtiar said that any country can invest in the CPEC on project basis. Saudi Arabia or any other country, he said, can enter into a trilateral investment framework. He said the third-party investment framework has been designed in consultation with China.
The minister dodged questions when asked how the cost of Main Railway Line (ML-I) had been reduced by a whopping USD 2 billion from USD 8.2 billion to USD 6.2 billion as claimed by Railways Minister Shaikh Rasheed Ahmed.
“I have noticed this today that Sheikh Rasheed is making some efforts (to reduce the cost) but not to my knowledge. Nothing has come in front of me to suggest that the cost has come down,” he said.
Bakhtiar said the CPEC portfolio currently stands at about USD 50 billion, of which about USD 6 billion was government-to-government loan and remaining in Independent Power Producers mode mostly in the energy sector. About USD 29 billion worth of projects were currently in progress.
He said the CPEC had far bigger potential than USD 50 billion and would keep expanding with time as new projects come up but the previous government treated and played it like a T-20 match instead of a five-day test series and focused mostly on projects which could be completed during its tenure.
Currently, a Saudi delegation is in Pakistan for initial assessment to capitalise on the Pakistani offer.
The US has criticised the Belt and Road Initiative (BRI) projects, warning that the loans could turn into debt traps for poor countries unable to pay them back. Beijing denies the claims, saying the loans are a win-win situation for both the countries.
The CPEC is the flagship project of the multi-billion dollar BRI, a pet project of Chinese President Xi, aimed at enhancing Beijing’s influence around the world through China-funded infrastructure projects
India has opposed the CPEC project and protested to China as it is being laid through Pakistan-administered Kashmir.
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