Farhat Ali
In a remarkable development, Pakistan has ranked No. 1 in South Asia in private infrastructure investment with $5.9 billion of investments in 2017, thus becoming one of the world’s top five private participation in infrastructure (PPI) investment destinations, states a new World Bank report.
For the first time ever, infrastructure investments in Pakistan surpassed that of India, which has traditionally been the heavyweight in the region.
Investments in Pakistan across four projects were far above the 2016 level of $1.7bn, according to the annual update of the PPI database released by the World Bank.
At the country level, the five countries with the highest levels of infrastructure investment in 2017 were: China with $17.5 billion with 73 projects, Indonesia $15.4 billion with 11 projects, Mexico $8.6 billion with 20 projects, Brazil $7.3 billion with 24 projects and Pakistan $5.9 billion with four projects. In 2017, these five countries attracted $54.5 billion, capturing 58 percent of the global investment.
In 2017, the energy sector outpaced other sectors in global ranking in attracting private sector investment, with $51.9bn invested in 203 projects which accounted for 56 percent of total PPI.
The transport sector accounted for $36.5 billion in investments in 2017, making up 39 percent of the PPI share.
The information and communication technology sector received only $3 billion with five projects, followed by the water and sewerage sector, with only $1.9bn with 30 projects.
In the World Happiness Index announced recently, Pakistan ranked as the most happiest country in the region.
Things have started to look good for Pakistan after decades of depression. And one has to admit that much of it has to do with the impetus that CPEC has provided to Pakistan’s economy.
Addressing a large gathering of diplomats at an event jointly organized by the Embassy of Switzerland and Swiss Business Council(SBC) on the occasion of the 10th Anniversary of SBC, former federal government adviser on Finance Dr Salman Shah has stated that Pakistani establishment and political parties have reached a consensus that in order to reach the desired GDP growth it is imperative to maximize benefits out of the CPEC. This is a promising development.
The high points drawn out by Dr Shah from his research revealed some interesting facts such as:
- The size of the Pakistan’s economy has the potential to touch $700 billion to $1000 billion by 2025 from existing size of $300 billion with the help of the CPEC;
- The trade volume could touch $700 billion and the Foreign Direct Investment (FDI) to $50 billion with 50 percent coming from China by 2025;
- Over 25 million new jobs could be created with businesses under the CPEC;
- Pakistan would become the hub of economic activities in Asia and many countries including European could draw benefits; and
- The size of agriculture economy today stands at $50 billion in Pakistan and it could soar to $300 billion.
These are big numbers and even if half of this optimism could be translated into a reality, Pakistan is all set to fly.
But the challenges are the governance and implementation issues in Pakistan. What makes a difference this time is the firm resolve of Pakistan and China that the opportunity of CPEC will not be allowed to be slipped. CPEC by all means has come to stay.
(The writer is former president of Overseas Investors Chamber of Commerce and Industry)
