CPEC Phase-II to go in full swing — I

During Prime Minister Shehbaz Sharif’s recent successful visit to China, it was mutually agreed that special focus should be given to industrial development, agricultural modernisation, science & technology and development of SEZs in Pakistan ; ‘Shehbaz Speed’ or ‘Punjab Speed’ is quite well known to the Chinese, both here and back home; with the launch of CPEC phase II, this cooperation, collaboration and partnership would go in full-swing, integrating the development of five corridors, with Pakistan’s 5Es strategy in line with China’s five principles of peaceful co-existence; West’s so-called concern over China’s ‘industrial over-capacity’ is unjustified.

These views were expressed by the Consul General of China in Lahore, Mr Zhao Shiren, in an exclusive interview with The News. Answering further questions on China-Pak multifaceted cooperation, the Consul General, first explained the five principles of peaceful coexistence. He told The News that China held a very important conference in Beijing to mark the 70th anniversary of the five principles of peaceful coexistence on June 28 last.

According to him, ‘President Xi Jinping, in his keynote policy speech, not only spoke volumes of the historic value and contributions of the five principles, but also emphasised the evolving development of the five principles into building a community with a shared future for mankind, highlighting China’s foreign policy goals of pursuing global peace, development, security, prosperity and governance through dialogue and cooperation.

By championing the five principles and the Global Development Initiative, Global Security Initiative, Global Civilisation Initiative, the Global Initiative on Artificial Intelligence Governance, and building a community with a shared future for mankind, China is demonstrating its unwavering support for and dedication to building a world of lasting peace, universal security and common prosperity, providing the Global South and the developing countries with more opportunities for revitalisation, transformation and development.

It is China who first initiated the five principles in 1953, which include mutual respect for sovereignty and territorial integrity, mutual non-aggression, mutual non-interference in each other’s internal affairs, equality and mutual benefit, and peaceful coexistence. These principles were endorsed respectively in the joint statements between China and India and between China and Myanmar in 1954, and were further developed in Bandung Conference, Indonesia in 1955, into the basic norms, guiding international relations and international law. They emerged in the post-World War II era, and continue to serve as the fundamental principles for international peace, security and cooperation, having profound impact on global diplomacy and international landscape.

The past seven decades have seen these five principles being time-tested and enjoying strong resilience and relevance. They remain a beacon of hope in today’s turbulent world, for building an equal and orderly multipolar world and universally beneficial and inclusive economic globalisation. Standing against international vicissitudes, the five principles have been upgraded into the noble vision of building a community with a shared future for mankind, underscoring China’s resolve and commitment to contributing to global development and human progress.

By celebrating and sustaining the five principles, China invests heavily in the future of global peace, security and development. A rising, strong and prosperous China is a blessing to the world. Embarking on the path of peaceful development and modernisation, China remains a major contributor to world peace, security, justice, and growth.

China’s approach towards Pakistan exemplifies its commitment to non-aggression and non-interference. Our relations are characterised by mutual respect, mutual benefits, and shared development. China has consistently supported Pakistan on various bilateral and international platforms, neither imposing its policies nor interfering in Pakistan’s internal affairs. The China-Pakistan Economic Corridor is a prime example of how China has stood by the five principles and jointly built with Pakistan a closer community with a shared future in a new era’.

Replying to a question on enhanced China-Pak cooperation in the days to come, the CG responded, ‘China and Pakistan are all-weather strategic cooperative partners, good friends, and iron brothers. Hence the bilateral cooperation is both comprehensive and strategic, going beyond the bilateral to the multilateral and international fora. China deems its cooperation with Pakistan within the ambit of South-South cooperation, and the ongoing cooperation has brought tremendous benefits to two nations and peoples. It is also conducive to keeping peace, stability and security in the region.

The China-Pakistan Economic Corridor is the flagship project in bilateral cooperation. During its 11-year trailblazing journey, CPEC has transformed Pakistan’s energy and infrastructural landscapes, and reshaped its socioeconomic development.

During Prime Minister Shehbaz Sharif’s recent successful visit to China, both China and Pakistan have agreed that with the timely completion of all ongoing projects, special focus should be given to the industrial development, agricultural modernization, science & technology, and the development of Special Economic Zones in Pakistan in particular. So, I believe that with the launch of CPEC phase II, our cooperation, collaboration and partnership will be in full-swing and further expedited.

The Gwadar Port development remains top priority and it will be transformed into a regional business and trade hub. Framework agreement has been signed on implementing the Karakoram Highway alignment project. Both sides also reaffirmed commitments to the Mainline-1 railway upgradation. Hopefully the financing arrangement and the phase-wise pilot construction will materialize in the near future.

Chinese goal on CPEC phase II is to integrate the development of five corridors, namely, the growth corridor, the livelihood-enhancing corridor, the innovation corridor, the green corridor, and the inclusive and open corridor, with Pakistan’s 5Es strategy, so that we can work together and strive for building better an even closer China-Pakistan community with a shared future in the new era’.

Dwelling further upon various facets of cooperation, the Consul General informed The News that it takes both G2G (Government to Government) and B2B (Business to Business). ‘It is a mixed model, or you may call it a parallel model, requiring engagement of both the public sector and the private sector.

In case of the China-Pakistan Economic Corridor, it is mainly G2G by nature, as all the mega projects concerning the power plants and the infrastructural construction demand huge investment and political support. Since inception of the CPEC, we have the understanding that G2G cooperation ensures smooth policy coordination and effective implementation of the projects. Given that, we are not opposed to B2B cooperation. B2B can supplement and complement G2G in uplifting the agricultural and industrial development of Pakistan and promoting trade and investment. In this regard, small and medium-sized enterprises and private companies are the right vehicles to undertake B2B cooperation. In the fields of labor- intensive and tech-intensive industries, agriculture, IT, solar energy and textile and garment manufacturing, B2B cooperation is more befitting.

In future development of the CPEC, G2G is still the need of the hour, while B2B is more encouraged. The all-round cooperation between China and Pakistan cannot stay only at the government-to-government level, and the private sector collaboration is what we need and are working hard on it. However, G2G can’t be picked to be against B2B, and vice versa. Which mode of cooperation should be taken may well depend on the local conditions and the cooperation targets.

In summary, G2G and B2B should work together and go hand in hand in pursuit of the maximum benefits for our two peoples”.

The Chinese diplomat was then asked, ‘Will this cooperation be on the basis of investment by Chinese companies only or will the Chinese banks give loans, as well, to Pakistan’?

The answer was: ‘Pakistan comes to an important juncture of socioeconomic development. The National Assembly managed to pass the FY25 budget, and the government just secured the Staff-Level Agreement with the IMF for a new bailout loans. China always renders its support to Pakistan when requested and if necessary. We are committed to deepening the bilateral cooperation in all respects. In the meantime, we also care about the debt sustainability in Pakistan. Therefore, my personal view is that the future cooperation between us might probably remain in the ambit of both investment and loans, edging more towards investment.

To further attract Chinese investors, I sincerely hope that the Pakistani government, both at federal and provincial levels, may create a more business friendly and investment friendly environment, plus enhanced security’.

Whether some more aid projects were in the pipeline after Gwadar airport, friendship hospital and desalination plant, asked The News. Mr Zhao Shiren explained, ‘Foreign aid is an important component of China’s foreign policy towards the developing countries, which aims to help the recipient countries to reduce poverty, enhance people’s livelihood, and improve economic growth and social progress, achieving sustainable development. China’s aid is based on amity, sincerity and mutual benefit, with no political strings attached. When providing aid to foreign countries, we adopt the philosophy and approach of ‘not only to give the fish, but more importantly to teach them how to fish.’

This year marks not only the 73rd anniversary of the establishment of diplomatic relations between China and Pakistan, but also the 68th anniversary of the Chinese aid to Pakistan. As for whether there is any aid project in the pipeline, I believe you will know when those projects are getting into the pipeline’.

Is Punjab getting more projects with Chinese cooperation, was yet another question posed to the Chinese functionary. In response, he stated: My answer is both yes and no. Being the largest and most populous province in Pakistan, Punjab enjoys a big share of the national economy, and plays an important role in Pakistan’s socioeconomic development. With the CPEC navigating through one-decade journey, Punjab has been provided some mega projects from China under the framework. The Orange Metro line, Matiari-Lahore Transmission project, Sahiwal coal-powered plant and the Quid-e-Azam Solar Park Bahawalpur, to name a few. There are also some B2B projects in the province, i.e. The Challenge Apparel, the Haier Industrial Park, and the Allama Iqbal Industrial Estate, Faisalabad.

The provincial government is making efforts to build a state-of-the-art Nawaz Sharif IT City, and a modern textile and garment city in and near Lahore. It also commits to set up a solar panel manufacturing plant seeking green transition and jobs for the local people. The Ravi Urban Development Authority officials have undertaken their roadshows in China, engaging the Chinese companies for the IT City. Punjab Bureau of Investment and Trade is also in touch with the Consulate to explore cooperation opportunities. In this context, I believe that more Chinese investments will come to Punjab.

Meanwhile, we should bear in mind that China-Pakistan Economic Corridor is not China-Punjab Economic Corridor. Which means that the joint projects and cooperation should be smartly planned and properly positioned to benefit all parts of Pakistan. We have no preference over a particular region or province, and only ask for synergy and further alignment of our development strategies. We should adopt a tailor-made and balanced approach, while taking stock of the local conditions and circumstances”.

The CG also informed The News about scholarship programs initiated in Punjab’s universities. Elaborating, he said, “Language and technology are essential to economic growth and social progress. Language serves as an effective communication tool to nurture mutual understanding across countries, cultures and civilisations as it also helps in bringing the people closer, boosting business, trade and investment. Technology is the driving force for economic prosperity and well-being of a society. In this regard, many programs have been done, and some are still ongoing.

Since assuming office two years ago, I have attached personal importance to promoting cooperation and exchanges in language, education, healthcare, and people-to-people contacts. We have set up the Chinese Consul General’s Scholarship Programme for some universities in Punjab, and provided grants to local hospitals and nonprofit and social welfare organizations. We dispatched two batches of doctors and nurses from Lahore to China for medical training. We facilitated media delegations’ visit to China. Last year, we partnered with the Punjab police to launch the Chinese language learning project for Special Protection Unit officers and sepoys. We were requested by the caretaker provincial government this January to bring in the Chinese environmental experts from Beijing to help tackle the smog pollution in Lahore. We are all in and keep working”.

The News asked, ‘Any MoUs are being signed in the near future, between Pakistan and China’?

Mr Zhao Shiren replied, ‘Many MoUs have been signed and projects being implemented. We may recall that during Prime Minister Shehbaz Sharif’s last visit to China in November 2022, China and Pakistan signed a number of Agreements and MoUs covering wide range of areas. Prime Minister Shehbaz visited China this June, and 23+32 cooperation framework agreements and MoUs were signed both in Beijng and Shenzhen, further expanding bilateral cooperation in digital economy, agriculture, financial cooperation, infrastructure, security and law enforcement, media and film industry, education, science and technology.

Being all-weather strategic cooperative partners, China and Pakistan have both institutional cooperation mechanism and collaboration platforms in place, and they are working in trajectory. Signing of MoUs and agreements is very important, and it is more important to have them honored and implemented in letter and spirit. I can assure you that on China’s part, we will do our utmost and best to ensure the timely, efficient and professional implementation of the MoUs and agreements’.

Responding to a question on security arrangements for the protection of Chinese people working in Pakistan, the Consul General told The News, ‘The March 26 Bisham attack is not only a terrorist act, but also a heinous crime targeting the CPEC, China-Pakistan friendship and the overall bilateral relations. Such attacks have further exposed the ugliness of terrorism menace in Pakistan. China accords high importance to the full investigation and exemplary punishment awarded to the perpetrators.

We have taken note, with both appreciation and satisfaction, that the Pakistani government, the army, security forces and law enforcement agencies have intensified their efforts in fighting terrorism. More Intelligence-based operations conducted, combing and search operations stepped up, with more terrorists being eliminated. The Pakistani government recently announced Operation Azm-e-Istehkam. We stand by Pakistan in fighting terrorism of whatever forms and manifestations.

Coming back to Punjab. During my meetings with Madam Chief Minister, Assembly Speaker, provincial ministers, Inspector General of Police, Home Secretary, and other key officials, I appreciated and commended the government for taking all possible measures to ensure the maximum security and safety of the Chinese in the province. They are serious and really take security of foreign nationals to their hearts. I also conveyed to them some concerns from the Chinese business community. Security can’t be compromised in any circumstances. I’m also of the view that the hosting government bears primary responsibility to provide fool-proof security to foreigners, including the Chinese, and the burden of responsibility shouldn’t be shifted from the government to the innocent individuals. Besides, security should be further aligned with development, and the approach and measures should be fine-tuned and more targeted, considering varied risk levels of regions and areas, and different needs from different groups’.

Whether any Chinese dignitary /VVIP is expected to visit Pakistan in the near future? Answering this question, the CG said,’ China and Pakistan have maintained close contacts and high-level exchanges. It has become a tradition indeed. Frequent exchange of visits by high-profile officials is not only a goodwill gesture, but also a must to further strengthen the friendly ties between us.

Prime Minister Shehbaz Sharif was reported to have given his affirmative answer to this when he chaired a cabinet meeting on June 11. Let me quote here ‘(A) High-powered Chinese delegation (is) to visit Pakistan soon.’ Then from June 20-23, Minister Liu Jianchao of International Department of the Central Committee of CPC came to Islamabad for a follow-up meeting under the CPEC framework. So there is something more in the pipeline. Insha Allah, let’s see when more will come’.

And, how do the Chinese view PM Shehbaz Sharif’s working? The CG stated: ‘We acknowledge the dedication, commitment and hard work made by various Pakistani leaders in developing their country and managing their state affairs, which certainly includes PM Shehbaz Sharif. The Chinese people respect, appreciate, and have regard of the Pakistani political leadership for their goodwill and sincerity towards the Chinese.

As Consul General of China in Lahore, I had the opportunity to meet the PM once at his Model Town residence, and was impressed with his leadership quality, pragmatism, and easy-going approach.

Public service asks for efficiency, while delivery demands speed. ‘Shehbaz Speed’ or ‘Punjab Speed’ is quite well known to the Chinese both here and back home, which is a testament of and an accolade to the Prime Minister’s governing performance when he was the Chief Minister of the Punjab. Shehbaz Sahib was re-elected PM after the February elections. Chinese President Xi Jinping and Premier Li Qiang both congratulated him on assuming the office. Three months into the federal government, the Prime Minister paid his first official visit to China. The arrangements, warm welcome and best protocols accorded to him during the visit, have sent a strong signal to the world that both China and Pakistan remain committed to further developing the bilateral cooperation and the traditional friendship’.

The last question asked was: ‘We have noticed that some Western countries have expressed concerns over China’s ‘industrial overcapacity’, especially in the EV (Electric Vehicles), batteries and photovoltaic sector. What’s your opinion?

Reply from CG: ‘Such concerns are fabricated and hyped, with no evidence or proof to back up at all. Blaming China for new energy overcapacity is an easy-taken maneuver by some Western countries. It is like the Chinese saying of calling a stag, a horse, or calling white, black.’

It not only misrepresents and distorts the true picture of China’s new energy development, but also has negative impact on the supply chain and market flows of the products. This attempt aims to curtail China from energy transition and manufacturing and exporting of the new energy products, dealing a big blow to the joint efforts of the international community in tackling climate challenges.

China’s new energy capacity is the need of the world for energy transition and green development. It is estimated by International Energy Agency that the global demand for new energy vehicles by 2030 will reach 45 million, 4.5 times that of 2022, and global demand for new photovoltaic installations will also soar. As new energy is concerned, the problem facing the world today is not overcapacity, but under-capacity, a severe shortage of manufacturing and exporting capacity. China’s green technology and products are mainly for its domestic consumption in addressing the energy challenges, and also contribute to global low-carbon and green transition.

China’s booming new energy industry is driven by technology and innovation, and dictated by the laws of economics and market mechanism, not by government subsidies. The competitiveness of its products highlights China’s heavy investment in research and development, plus adhering to the proverbial saying of ‘early birds catch the worms.’

Accusing China of new energy overcapacity manifests trade protectionism and economic nationalism by the Western countries. The Bloomberg analysis shows that the export-production ratio of the Chinese electrical vehicles is far lower than other car producing nations, such as Germany, Japan and Korea. Chinese electrical vehicles are not dumped on global markets. The overcapacity rhetoric provides, in essence, a pretext and an excuse for those countries to impose excessive tariffs on Chinese products, and protect their under-performing auto industries and jobs. Market restriction and trade limitation of the new energy products will do no good to China and the countries in need. It instead will backfire.

China stands ready to work with all parties concerned in upholding market rules and fair play. Doing business, we ask for nothing but a level playing field. We will continue to contribute to the global energy transition and green development’.

Exclusive interview with

Chinese Consul General in Lahore, Mr Zhao Shiren