CPEC trouble: Pakistan halts work on 3 road projects that China stopped funding

Work on the road project will resume only after China hands over the money, a minister said.

Representational image of road construction work in Pakistan under the CPEC. (Twitter/@CPEC_Live)

Pakistan's debt-ridden federal government has stopped work on the three CPEC road projects for which China has stopped the funding, a leading Pakistani newspaper has reported. The work will resume only once the Chinese money comes in.

Leading Pakistani daily Dawn reported that the country's Minister for Planning and Development Ahsan Iqbal confirmed to the 22-member Parliamentary Committee on CPEC that the works on the three road projects had been stopped.

However, the committee, in a press release on Monday evening, went to great lengths to send the message that the projects had not been abandoned. The statement however ended up underlining the inability of the financially strained Pakistan government from carrying on with the work.

"The meeting was informed that contrary to the speculation in the media, the reports of shelving three infrastructure projects is not correct, rather, Chinese side was reviewing the financial mechanism of these projects and these would be started upon receipt of approval from the Chinese side," read the statement.

Pakistan's unwillingness, or inability, to carry on with the road projects could be seen as an indication of it sliding further into a spiral of Chinese debt. Global experts have warned of that China's CPEC diplomacy may be a debt-trap. That came true, and was on open demonstration on December 9, when Sri Lanka handed over control of the Hambatota Port to China as it was unable to make repayments on the Chinese loan.

China had stunned Pakistan on November 20 by stopping the funding for the three projects. The stop-funding announcement sparked speculation on whether it was retribution for the limited spine that Pakistan had showed. 

In the run up to China's decision to stop the funding, Pakistan had snubbed Chinese officials twice. First, it had refused Chinese CPEC funding for the Diamer-Bhasha Dam in Pakistan-occupied Kashimr (PoK), saying the China's terms were against Pakistan's interests. Next, the Pakistanis had refused to allow the Chinese to trade in the yuan at the Gwadar Port.

China had told Pakistani officials that corruption in CPEC projects was among its top concerns. However, the European Foundation for South Asian Studies (EFSAS), an Amsterdam-based think tank, had said in an analysis that China's moves are aimed at taking responsibility for CPEC out of the hands of the civilian administration and put it in the hands fo the Pakistan Army.