Ahead of a high-level meeting, the Khyber Pakhtunkhwa government has approached the federal government to jointly push forward to include priority development projects of the provincial government in the China-Pakistan Economic Corridor framework.

These projects will be discussed in the upcoming Joint Cooperation Council at Islamabad.

The move came from the provincial government amid fears that Chinese may drop some of the key priority projects of the KP government as was hinted in the recent Joint Working Group meeting in which China has backed out from its earlier stance, especially the understanding reached on the highly trumpeted project of establishing a special economic zone over 1,000 acres along the M-1 Motorway in Nowshera near Rashakai.

In the 6th CPEC JCC meeting held in 2016, different sites for the establishment of SEZs were identified. In KP’s case, 17 sites were identified for SEZs. Only two of the 17 sites were referred to the JWG for consideration — SEZ at Rashakai as priority and Hattar Phase VII industrial zone (alternative).

As per agreement, Rashakai SEZ from KP has been nominated as a priority SEZ — KP’s Flagship industrial project at an area of 1000 acre expandable to 2600 acres.

An official of the KP government said that based on the feedback received from the experts of National Development and Reform Commission (NDRC), formerly state planning commission of China, regarding outstanding points, ground work is also being started at the site. “We are working on ground-breaking ceremony of the site”, the official said, the earlier tentative date was November 17.

There are fears that the Chinese may drop some key priority projects of the province, as was hinted when China backed out of the Rashakai economic zone

The PTI-led coalition government projected Rashakai industrial estate as one of the major projects to be on ground ahead of the next general election. But to the surprise of the KP government, in the CPEC JWG meeting held in Islamabad on November 9, the NDRC showed keen interest in Hattar industrial zone instead of Rashakai.

According to a source in KP planning department, Chief Minister Pervez Khattak was not happy at all with the sudden change in the original plan. A letter is being sent to Interior Minister Ahsan Iqbal who also holds the planning and development portfolio, to include Rashakai SEZ in the CPEC framework as envisaged. It was emphasised in the letter that Hattar is the second choice of the KP province and may be offered in addition to, not in replacement of, Rashakai SEZ.

“We are certain that the Mr Ahsan Iqbal will appreciate that KP has in place a sound provincial Industrial Policy, with incentives properly funded by its own resources, backed by a proper disbursement mechanism. Hence KP is qualified and equipped to host SEZs”, the letter said as quoting the chief minister.

Uncertainty also prevails on whether these SEZs will be established as a joint venture or be purely owned by Chinese companies. One source in the provincial government said that one of China’s largest state-owned companies, China Road and Bridge Corporation, has shown an interest in acquiring 1000 acres to develop an exclusive zone at Hattar. However, according to the source this proposal has not received substantive support from the provincial government.

According to a source in KP planning department, Chief Minister Pervez Khattak was not happy at all with the sudden change in the original plan. A letter is being sent to the interior minister

“We are not clear about the Chinese government’s policy because it keeps changing”, the source said, adding the only issue is the writing of minutes in the Chinese language. It was observed on many occasions that the spirit of the decisions changed when they were translated to English.

KP sees the CPEC framework as a timely and appropriate vehicle for economic uplift and for sharing the dividends of peace with people in the province.

In this background, the provincial government has offered the federal government consider SEZ at Hattar instead of one originally envisaged in Islamabad Capital Territory for inclusion in CPEC framework. It is believed it will serve needs of Islamabad-Rawalpindi/Western Punjab which is a severely an under-developed area.

As per proposed plan, the Hattar SEZ may be connected (for light-medium traffic) directly with ICT through the proposed Dhorian — Pind Muneem — Tunnel under Margalla / Shah Allah Ditta — Islamabad D-12. This project may be clubbed together with Hattar SEZ and included in the CPEC Framework, for the benefit of the people of ICT as well as remote Hazara, said an official of the provincial investment board.

For the November 20-21 CPEC 7th JCC meeting KP has sought help of the federal government to include projects in the framework. These include Rashakai SEZ, including 225MW CCGT Power Plant and Cargo Terminal linked to ML-1. It was also proposed to include Hattar SEZ, including 225 MW CCGT Power Plant and Cargo Terminal linked to ML-1, and Hattar — ICT Link Road in CPEC framework.

The proposal from the provincial government includes establishment of D I Khan 225 MW CCGT Power Plant for SEZ. In April 2017, the power plants have already been presented to the expert group of the energy and power JWG.

KP believes the inclusion of these projects will set an example of national integration and collaboration for the benefit of all people.

Published in Dawn, The Business and Finance Weekly, November 20th, 2017