Islamabad Oct 21: Chinese Development Association Commits to $13 Billion Investment in Pakistan Over the Next Five Years. The China Asia Economic Development Association (CAEDA) plans to invest up to $13 billion in a free trade zone in Pakistan over the next five years.
Islamabad has tried to draw in foreign investment from regional allies like China and the Middle East to support its shaky economy as Pakistan struggles with a protracted economic crisis that has caused its foreign exchange reserves to drop to extremely low levels and its currency to depreciate dramatically.
To encourage foreign investment in industries including mining, agriculture, tourism, and others, the South Asian nation established the Special Investment Facilitation Council (SIFC) last year. A hybrid civil-military organization, the SIFC was established to expedite decisions pertaining to investments.
In the next five years, the China Asia Economic Development Association (CAEDA) plans to invest $13 billion in Pakistan’s free trade zone, according to Radio Pakistan. “This investment is expected to reach 30 billion dollars, with an initial layout of 8 to 13 billion dollars,” it continued.According to Radio Pakistan, the goal of the free trade zone is to serve both the domestic and international markets.
It further stated that the area where Pakistani citizens will be allowed to purchase overseas items includes a duty-free shopping center. According to the official television, CAEDA has also invested $500 million to send 20 fishing boats to Pakistan.
“A delegation of the Association, supported by the Special Investment Facilitation Council, discussed agreements with Ministries of Health and Energy regarding investments in pharmaceuticals, solar power grid connection, and refined petroleum products,” the statement read.
China is one of Pakistan’s biggest allies and investors, having committed more than $65 billion to economic, infrastructure, and road projects as part of the China-Pakistan Economic Corridor (CPEC) initiative. CPEC is a component of the Belt and Road Initiative, a vast infrastructure project with a global reach spearheaded by China.
Since 2013, Pakistan’s faltering economy has benefited greatly from Chinese investment and financial assistance, including loan rollovers that enable Islamabad to cover its external financing needs during a period when its foreign reserves are low.
Pakistan and China are longstanding friends, but recent security issues have caused some tension in their relationship. In recent years, Chinese staff have been killed in attacks on Chinese projects in Pakistan by separatist and religiously motivated extremists.
Three individuals, including two Chinese nationals, were murdered in a suicide explosion earlier this month in Karachi, a port city in southern Pakistan that was claimed by the separatist Balochistan Liberation Army (BLA).
The third significant assault on Chinese interests in Pakistan in a week occurred in March when a suicide bombing claimed the lives of five Chinese workers. China has urged Islamabad to guarantee the safety of its people in Pakistan. By promising to give its residents who live and work in the country unquestionable security, the South Asian government has attempted to allay Chinese concerns.
