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Pakistan & China develop differences on CPEC related projects By Aftab Ahmed

Seventh Joint Cooperation Committee (JCC) of the CPEC between Pakistan and China recently concluded at Islamabad last month only speaks of about the consensus reached on the summaries of discussions but did not reflect in the minutes of the meeting.

Although the JCC meeting approved Long-Term Plan (LTP) of CPEC, yet it did not mention how it would be completed and also silent on the key features of this plan as well.

They only agreed, “Both parties will press ahead the implementation of the LTP together, maintain close communication, follow up the implementation progress and evaluate and update the content of the LTP in due course,” said the minutes of the meeting.

On Energy projects, the JCC meeting also agreed to create a revolving bank account within 30 days after the commercial operation date of the energy projects under CPEC and also, they agreed to resolve the early resolution of EPC provincial sales tax so that CPEC power generation projects are not adversely affected. They also agreed not to adopt differential electricity charge policies toward CPEC power projects designed and constructed in Chinese Standards, technologies and equipment.

On security of the CPEC projects, they also agreed to enhance input to strengthen and protect the safety of the projects, companies, organizations, as well as personnel working for CPEC. The Chinese side also assured expediting allocation of resources for capacity building of SSD and other law enforcing agencies.

They will continue the close coordination and cooperation to secure the safety and smooth development of CPEC. The two sides also agreed to expand the cooperation among the tax authorities of the two countries, make full play the tax treaties (DTA), expedite tax dispute settlement, strengthen tax administration capacity, enhance tax certainty, and provide equal taxpayer service, so as to create a good environment for trade and investment.

Insiders of the meeting revealed that both the sides have expressed their differences on the construction of mega dams like Bhasha Dams, ML-1, new Gwadar International Airport and some highway projects of the federal and provincial governments.

On construction of big dams like Bhasha Dam, the Chinese side expressed its willingness but they were simply conveyed that Pakistani side wants to construct the dam from its own resources while on ML-1, the insiders say that both sides have differences on the financing of the project which required eight billion dollars to complete this project.

On the construction of highways both in federal and provincial governments proposed under CPEC, were decided that the Chinese side tell its Pakistani counterparts that they first should complete technical and commercial studies of the projects, and then the Chinese side will decide the financing of these projects.

They include KKH-Thakot-Raikot (N-35) remaining portion of 136 Km, Khuzdar-Basima Road (N-30) of 110 Km, Upgradation of D I Khan-Zhob,(N-50) of 210 Km, EastBay Expressway (Phase II), Gwadar Port Breakwater, Gwadar Port Dredging, Mirpur-Muzaffarabad-Mansehra (200Km), Gilgit-Shandoor-Chitral (359 Km), Nokundi-Mashkel-Panjgur (290 Km) and Keti Bandar Sea Port Development Project.

About Karachi Circular Railways (KCR), both the sides agreed that this project is technically qualified and mature for implementation while for greater Peshawar Mass Transit Circular Rail and Quetta Mass Transit projects after approval of PC-1 would be discussed in the next Joint Working Group (JWG).

On the development of Gwadar Port and Gwadar Free Zone, both sides also supported to carry out relevant construction work as soon as possible while Gwadar Port would be a model project of CPEC whereas Pakistani side emphasized that marine life and environmental protection be kept in mind in development of industrial sector in Gwadar and Chinese standards (Fujian province) will be followed and be replicated in Gwadar.

Water supply to Gwadar, they agreed to make efforts for water requirement of the city on permanent basis whereas 300MW coal fired power plant, the Chinese side wanted to replace CIHC with CCCC as the main sponsor of the project and initial shareholder of the project.

New Gwadar International Airport, both sides agreed to complete the design process as early as possible and ground breaking of the projects as an early date as well whereas the extension and renovation of existing airport, both the sides will further deliberate on the issue.

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