China Pakistan Economic Corridor

(CPEC)

5th November, 2015

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Signing of MOU on CPEC - July 05, 2013, Beijing

Prime Minister Muhammad Nawaz Sharif’s visit to China in July 2013 – his first official overseas trip since assuming office

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MoU - CPEC

– The aim of the MoU is to enable the Government to cooperate in the planning and development of CPEC and facilitate and intensify economic activity along the Corridor.

– The Ministry of Planning, Development & Reform (MPD&R) is the focal Ministry for this engagement whereas its counterpart in China is National Development and Reform Commission (NDRC).

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Cooperation Fields

China Pakistan Economic Corridor Long Term Plan : Timeframe 2014 – 2030Components:I. Gwadar ( including port and city and Gwadar region socio-

economic development)II. Energy (Coal, Hydel, Wind, Solar, LNG , Transmission)III. Transport Infrastructure (Road, Rail, Aviation)IV. Investment & Industrial Cooperation (Gwadar Free Zone and

other industrial parks to be finalized)V. Any other area of interest mutually agreed

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Institutional Framework - CPEC

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Joint Cooperation Committee(Co-Chaired by Minister PDR and Vice Chairman NDRC)

Long Term Planning Joint Working Group

EnergyJoint Working Group

Transport InfrastructureJoint Working Group

GwadarJoint Working Group

Investment & Industrial Cooperation Joint Working Group (Being

formulated)

CPEC Portfolio-ProjectsPROJECTS US$ Millions

Energy 33,793

Transport and InfrastructureRoads 6,100

Rail Network 3,690

Gwadar Port 786

Others 44

Total 44,413

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CPEC-Energy Priority ProjectsSr. No Projects MW Cost (US$ M)

1 Port Qasim Electric Company Coal Fired, 2X660, Sindh 1320 1,980

2 Sahiwal 2x660MW Coal-fired Power Plant, Punjab 1320 1,600

3Engro thar 2x330MW Coal-fired, Thar, Sindh 660 1,000

Surface mine in Block II of Thar Coal field,3.8 mtpa, Thar Sindh 860

4 Gawadar Coal Power Project, Gwadar 300 360

5 Muzaffargarh Coal Power Project, Punjab 1320 1,600

6 Rahimyar Khan Coal Power Project, Punjab 1320 1,600

7 SSRL Thar Coal Block 6.5mpta &CPIH Mine Mouth Power Plant, Thar, Sindh 1320 1,300

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CPEC-Energy Priority ProjectsSr. No Projects MW Cost (US$ M)

8 Quaid-e-Azam 1000MW Solar Park, Bahawalpur, Punjab 1000 1,350

9 Dawood 50MW wind Farm, Bhambore, Sindh 50 125

10 UEP 100MW wind Farm, Jhimpir, Sindh 100 250

11 Sachal 50MW Wind Farm, Jhimpir, Sindh 50 134

12 Sunnec 50MW wind Farm, Jhimpir, Sindh 50 125

13 Suki Kinari Hydropower Station, KPK 870 1,802

14 Karot Hydropower Station, AJK & Punjab 720 1,420

Total (Priority) 10400 15,506 8

CPEC-Energy Actively Promoted Projects

Sr. No Projects MW Cost (US$ M)

15 Gaddani Power Park Project

(i) 4×660MW 2640 7,920

(ii) Jetty + Infrastructure 1,200

(iii) Transmission Line to Lahore and Faisalabad 3,000

16 HUBCO coal power plant, Hub Balochistan 660 970

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CPEC-Energy Actively Promoted ProjectsSr. No Projects MW Cost (US$

M)

17 Chichoki Mallian 525MW Combined-cycle Power Plant, Punjab 525 550

18 Salt Range Mine Mouth Power Project including mining, Punjab 300 800

19 Kohala Hydel Project, AJK 1100 2,397

20 Pakistan Wind Farm II (Jhampir, Thatta, Sindh) 100 150

21 Thar mine mouth oracle, Thar Sindh 1320 1,300

Total (Actively Promoted) 6645 18,287

TOTAL Energy Projects 17045 33,793

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CPEC-Transport Infrastructure Sector ProjectsSr. No Projects Length (km) Cost (US$ M)

Roads

1 KKH Phase II (Raikot – Islamabad Section) 440 3,500

2 Peshawar-Karachi Motorway (Multan-Sukkur Section) 392 2,600

Rail Sector Projects

1 Expansion and reconstruction of existing Line ML-1 1736 3,650

2 Havelian Dry port (450 M. Twenty-Foot Equivalent Units) 40

TOTAL 9,790

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CPEC-Gwadar Port Related ProjectsSr. No Projects Cost (US$ M)

1 Eastbay Expressway 140.00

2 Gwadar International Airport 230.00

3 Construction of Breakwaters 130.00

4 Dredging of berthing areas & channels 27.00

5 Infrastructure for Free Zone & EPZs port related industries 35.00

6 Necessary Facilities of Fresh Water Treatment and Supply 114.00

7 Hospital at Gwadar 100.00

8 Technical and Vocational Institute at Gwadar 10.00

Total Gwadar Port Projects 786.0012

Other Projects

Sr. No Projects Length (km) Cost (US$

M)

1 Cross Border Optical Fiber Cable 44

2 DTMB

Total 44

Total Cost of CPEC Projects 44,413

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CPEC

Transformation

Aimed at Regional Integration for peace and economic development

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Jamu & KashmirDisputed Territory

SOUTH

KAZAKHSTAN

CHINA

KYRGYZSTANUZBEKISTAN

TURKMANISTAN

I R A N

AFGHANISTAN

GULF STATES

INDIA

TAJIKISTAN

AZERBAIJAN

NEPAL

BHUTAN

BANGLADESH

MYANMAR(BURMA)

PAKISTAN

DISPUTED TERRITORY

ARABIAN SEA

XIZANG (TIBET)

PAKISTAN’S GEO-STRATEGIC GEOGRAPHIC LOCATION

BANDAR ABBAS

The Landscape of CPEC Khunjerab

Peshawar

DI Khan

Quetta

Faisalabad

Jacobabad

Khuzdar

Gwadar

DG Khan

Hoshab

Basima

Skardu

Karachi

Lahore

Sukkur

Khanewal

GilgitRaikot

Islamabad

Hyderabad

Havelian

Kotri

Islamabad

Lahore

Peshawar

Sukkur

Quetta

Gwadar

Nodes of CPEC

Karachi

Gwadar and its Multiple Destinations

18Gwadar and its Destinations

Envisioning Interconnected World

of Peace & Development by serving multiple

markets & destinations

Rising Asia

One Belt one

Road

Regional Connectivity Vision2025CPEC - Context

Serves Asia’s over 3 Billion population

Integrates/links Silk Road Economic Belt and

21st Century Maritime Silk Route

Regional Connectivity is the 7th Pillar of

Pakistan Vision 2025

Significance/Potentials of CPEC

• Regional Connectivity– Transport Infrastructure– Energy Hub/flows– Logistic Hub/flows– Trade & Commerce– Peace & development of region– Connectivity/Harmonnization/Integration of

civilizations

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Significance/Potentials of CPEC

• Diverse Investment opportunities• Industrial Cooperation• Financial Cooperation• Agricultural Cooperation• Tourism• Educational linkage• Human resource development • Health Care• People to people contact• Increase in livelihood opportunities• Enhance Security and stability of the region

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FINANCIAL MUSCLE BEHIND CHINA’S INITIATIVES

CPEC OPPORTUNITY

• IT PROVIDES A LINK BETWEEN CHINA’S SILK ROUTE INITIATIVES OF ROAD &MARITIME CONNECTING EUROPE, AFRICA, WESTERN, CENTRAL AND EAST ASIA INORDER TO:– SAVE TRAVEL TIME– SAVE TRAVEL DISTANCE– REDUCE LOGISTICAL COST– PROVIDE ALTERNATIVES FOR RISK MANAGEMENT

"The starting point of all achievement is desire." --Napoleon Hill

VISION OF CPECTO IMPROVE THE LIVES OF PEOPLE OF PAKISTAN AND CHINA BY

BUILDING A ECONOMIC CORRIDOR PROMOTING BILATERAL CONNECTIVITY CONSTRUCTION, EXPLORE POTENTIAL BILATERAL INVESTMENT, ECONOMIC AND TRADE, LOGISTICS AND PEOPLE TO PEOPLE CONTACT FOR REGIONAL CONNECTIVITY.

IT INCLUDES:• INTEGRATED TRANSPORT & IT SYSTEMS INCLUDING ROAD, RAIL, PORT ,

AIR AND DATA COMMUNICATION CHANNELS• ENERGY COOPERATION• SPATICAL STRUCTURES, FUNCTIONAL ZONES, INDUSTRIES AND INDUSTRIAL

PARKS• AGRICULTURAL DEVELOPMENT & POVERTY ALLEVIATION• TOURISM COOPERATION & PEOPLE TO PEOPLE COMMUNICATION• COOPERATION IN LIVELIHOOD AREAS• FINANCIAL COOPERATION

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CPEC FRAMEWORK 1+4

• ENERGY COOPERATION• INFRASTRUCTURE DEVELOPMENT• GWADAR PORT• INDUSTRIAL COOPERATION

"You can't connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something--your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life." --Steve Jobs

ROLE OF CHAMBERS OF COMMERCE AND INDUSTRY ASSOCIATIONS IN CPEC

• Need to facilitate Chinese Investors for one window operation • Identify policy gaps as compared to other countries.• Identify industries which could be shifted from China to Pakistan• Identify components of supply chain we could tap for core industries we

should establish• Help in getting local input/involvement.• Help in identifying and developing local talent/core competencies• Help in capturing the benefits of world classes logistical setups along the

Corridor for businesses • Transfer of Chinese know how and best practices• Help business in availing HBL and ICBC collaboration for financing CPEC projects• Help in match making for successful JVs/collaborations for creating investment

opportunities

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Goal: Entrepreneurship at all market segments should avail CPEC opportunity with goal to make pilot industrial park a model for replication

WIN-WIN COOPERATIONSWe need to aim for cooperation in those sectors which will result in a win-win scenario:-• Chinese Prospective– Products whose total cost could be reduced by shifting.– Products whose quantity sold could be increased to solve

the overcapacity problem.– Provide growth opportunities in view of domestic slow

down. • Pakistani Prospective– Reduce reliance on imports– Increase exports and improve industrialization process– Benefit from Chinese R&D

China's exports to Pakistan amounted to

IMPORT PROFILE OF PAKISTANTOTAL IMPORTS F.Y. 2014 47.5 B• Oil $ 14.8 B• Machine, engine & pump $3.7

B• Electric equipment $ 3.3 B• Iron & Steel $2.3 B• Animal &vegie fats $2.2 B• Organic chemical $2.0 B• Plastics $2.0 B• Vehicles $1.3 B• Fertilizers $813.3 M• Oil Seed $780.7 M

IMPORTS FROM CHINA $9.6B-20%• Electronic equipment: $2.3 B• Machine, engine, pumps: $1.4B• Iron and steel: $712.7 M• Fertilizers: $551.7 M• Organic chemicals: $490.8 M• Manmade filaments: $479.4M• Plastics: $335.8 M• Manmade staple fiber:$310.9M• Iron or steel products: $292.9M• Rubber: $195.9 million

EXPORT PROFILE OF PAKISTANTOTAL EXPORTS F.Y 2014Major items of total shipments:• mineral fuels 19%• manufactured goods 19%• beverage and tobacco 13% • food and live animals 11%• crude materials 11% • chemicals 11% • machinery 8%• miscellaneous articles 8%

Main export partners were:• United States (13.6 %)• China (11 %) • United Arab Emirates (8.5%)• Saudi Arabia (8.5 %).

TOTAL EXPORTS TO CHINA $2.7 B• Cotton: $1.9 B• Cereals: $144.1 M• Ores, slag, ash: $129.2 M• Salt, S, stone, cement: $63.5 M• Raw hide$57.1 M excl furskin• Plastics: $43.1 M• Food waste, animal fodder: $37.8 M• Copper: $36.6 M• Fish: $35.8 M• Gums, resins: $29.7 M

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China became world’s largest trading country total export & imports of goods in 2012

OUR OBJECTIVES• We need ways to harness the positive

potential of Chinese flows to raise living standards and shared prosperity while mitigating the associated risks and challenges.

• The cost of being left behind—for Pakistan, our businesses/companies, and citizens—is rising with time.

Goal: To Become An Asian Tiger

"All our dreams can come true if we have the courage to pursue them."

--Walt Disney

CPEC aims at regional connectivity for peace & development where private sector has key role to play for exploiting the potentials/environment for

the economic growth of the countryand

it would succeed with integrated efforts of all for the better future of us & the region/the world

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Thanks

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