Within weeks of taking over the federal government the PML(N) leadership announced that it wanted to abolish the CPEC Authority and hand over the China Pakistan Economic Corridor to the Ministry of Planning and Development under Federal Minister Ahsan Iqbal. PM Shehbaz Sharif has given a nod to the new arrangement. What is required now is to pass a statute. The CPEC Authority has been under fire for a number of reasons. It was maintained that the Authority had become dysfunctional and was in conflict with the line ministries which under the rules of business had basic roles in the implementation of policies and projects. The Authority had become a parallel organization which led to duplication of work and promoted lack of ownership. It was also maintained that the Authority had become an obstruction in the fast implementation of the projects because of the breakdown of the decision-making chain.
With the Ministry of Planning and Development tasked to implement CPEC, this will test the ability of Federal Minister Ahsan Iqbal. Improving the situation would require innovative measures. Gwadar; which is the centre piece of China-Pakistan Economic Corridor, has neither a satisfactory water supply system nor adequate provision for electricity. It has yet to show even its first glimmer of the promised industrial hub. Again, the initial CPEC plan visualised Special Economic Zones (SEZs) to be ready by 2020, but in the last four years, there has been dismal progress on them.
All CPEC problems are not due to bad administration alone. They also have a geopolitical dimension. Pakistan wants good relations with both the USA and China whose relations continue to worsen. This brings the IMF too into the fray. Pakistan is required to pay around Rs300 billion to the Chinese power plants, putting Islamabad in a tight spot. The IMF objected to giving Rs50 billion to the Chinese IPPs in February this year without first renegotiating the agreements. Besides resolving the administrative problems sufficient diplomatic inputs would be needed to make the CPEC realize its potential.