 Good afternoon everybody. Hope everybody's well. Hello. My name is Nancy Lindborg. I'm the president of the US Institute of Peace, and I'm delighted to welcome you here today. And for those of you who are not familiar with USIP, just a quick note that we were founded more than 30 years ago by Congress as a federally funded independent National Institute, and we were funded and founded with the proposition that peace is possible, that it's very practical, and that it is absolutely essential for our national and our international security. And so US Institute of Peace has a mission of working for a world without violent conflict, and we do this by working with partners around the world and particularly in conflict affected areas to equip people, institutions, and governments with the very practical skills and the tools and the information that allows them to manage conflict so that it doesn't become violent and to resolve it when it does. And we operate on the premise that there will always be conflict and the challenge is how do we make conflict transformative as opposed to violent? So we are working around the world with partners to make peace possible. And without question, one of the defining stories of the last several decades has been the increased presence and influence of China around the world. And we are seeing that China's government, that its companies, that its citizens are more and more active and engaged around the world. And this presents both opportunities and it presents challenges for how to enable that to be part of how we manage and resolve conflict. And we here at US Institute of Peace are particularly interested in the way that China's role in the world affects global peace and conflict dynamics. I think everybody here would agree that China and the United States don't always have aligned interests and approaches, but we do share many interests, many complementary peace-building goals, and it is definitely in our shared interests to ensure that conflicts don't erupt into the kind of violence that disrupts business, often results in terrible loss of life, and rolls back very precious peace-building and development objectives that both of our countries invest heavily in ensuring. And so USIP is very interested in looking at those areas where our objectives converge and where there are areas for coordination and cooperation. And when views don't converge, when we have differing views, how do we prevent those differences from exacerbating instability or complicating our peace-building efforts? Right now, one of China's most high-profile global engagement efforts is the Belt and Road Initiative, or BRI, I'm told. Do we call it BRI or just BRI? No, we don't use initials. Okay. All right, acronym police alert. But this is a presidential-level initiative, and it aims at investing trillions of dollars across Eurasia over the next several decades. This effort, as I think many of you are quite aware, is looking at connecting China with Central Asia and with Europe over land and also reviving links by sea. So our panel today, thank you panelists, is very much focused on the biggest project within the Belt and Road Initiative, which is the China-Pakistan Economic Corridor, or CPEC. We can call it CPEC, right? Okay, acronym. China and Pakistan have a very close diplomatic relationship, and China has a pledged investment of nearly $50 billion, which is substantial and has the potential to really dramatically reshape Pakistan. So this is an important time to have this conversation about CPEC. The first large shipment of goods has already reached Gwadar port in southwestern Pakistan just two weeks ago. Afghanistan and Iran are also interested in joining CPEC, so it's an important time to have this conversation. We're delighted to have this very expert panel of discussants here today to talk about CPEC, its implications for peace and conflict in Pakistan, and really the broader effect on security throughout the region. So to moderate the discussion today, I am just delighted to introduce Jennifer Statz, who's our director of the USIP China program. Jennifer has been with us just under a year, and before that she was with the Office of the Secretary of Defense where she focused on policy issues related to Asia's security and particularly cyber security. She's worked as director of cyber security and national cyber partnerships where she coordinated closely with the White House and throughout the interagency and the private sector and previously led teams in the strategy office of DOD looking at the whole rebalance to the Asia Pacific. So she is a wonderfully energetic new director for us and I'm just delighted to hand this over to Jennifer to take us through this conversation. Thank you again to everyone for joining us and take it away. Thank you Nancy. Good afternoon everyone and thank you all for joining us today for what I'm sure is going to be an excellent discussion on the China-Pakistan economic corridor. I think we all know this is an issue that's been getting a lot of attention here in Washington and also around the world and we're going to focus today on sort of where things stand so far but then also really focusing on the implications for peace and security both within Pakistan but also within the broader South Asia region. CPAC is obviously an ambitious and very high-profile initiative. It has support from the very top in both the Pakistani and the Chinese governments and I would say that both countries really have a lot riding on its success. So there's a lot to discuss today. I've talked with most of the panelists earlier and I know they have a lot to say so I'm going to be very brief and really want to turn it over to them. Again this is a great time to be talking about CPAC. Things are just really starting I think to materialize on the ground and we'll hear more about that from the speakers today and there really are a lot of reasons to be very optimistic about CPAC and the benefits that it might bring to Pakistan but at the same time I think it's not a panacea and there are definitely concerns about how the implementation will go forward and the effect that that might have again on Pakistan and on the region. So it's really I think a fascinating story one that's just getting started and we are very lucky to have four true experts with us here today to help us make sense of where we are and where things may be going forward. So our first speaker will be Hussein Nadeem who has been here at USIP for the last three months as a senior Pakistan expert and he has really been a terrific addition to the Asia Center and the rest of the institute as a whole. Before coming to USIP he was a former special assistant to Pakistan's federal minister of planning development and reforms where he helped oversee the implementation of CPAC projects in Pakistan and so he will discuss today the progress of specific energy and infrastructure or sorry energy and connectivity projects with CPAC as well as the impact that CPAC may be having on Pakistan's economy and internal stability. Our second speaker will be Rafiq who is the president of Vizier Consulting LLC and also a fellow at the Center for Global Policy and a non-resident fellow at the Middle East Institute. He has been doing extensive research on CPAC over the last year and has been on the ground in Pakistan talking to government officials, business leaders, civil society organizations about the various parts of that project and so he will discuss today some of the institutional capacity challenges facing the Pakistan government with respect to the CPAC initiative. We're also very pleased to have Zhao Hai here with us from Beijing. He is a research fellow in the National Strategy Institute at Tsinghua University and he will discuss the importance of CPAC to China's broader Belt and Road initiatives and the impact that CPAC may have on China's relationships with Pakistan and with India and finally last but not least we're very happy to have Sarah Watson here. She is an associate fellow with Wadwani Chair in US India Policy Studies at the Center for Strategic and International Studies and she will help round out our discussion by highlighting some of the regional considerations for CPAC specifically providing some of the Indian perspectives but then also discussing some of India's concerns related to CPAC. So we've got a lot of ground to cover and not a lot of time so I'm going to let our panelists speak first about 10 minutes each or so and then we'll try to leave as much time as we can at the end for questions and answers so that everyone else has a chance to participate as well. So thank you again for joining us and I'll turn it over to Hussain. Thanks Jennifer. It's a pleasure to be here today and thank you all for showing up. Just to state it at the very onset my views expressed over here do not represent the views of any organization or government and I would like to wear a scholarly hat specifically for this forum to discuss CPAC which has somewhat also become a controversial issue in Pakistan so you have to be very cautious when you're talking specifics on the subject but it's very reassuring to be here today partly because this is a second event on CPAC specifically in this week and it is I'll start by giving you an observation. I was in D.C. last time in 2012 at the Wilson Center and the conversation back then when I was meeting people in different departments and institutions was a lot about terrorism specific on Pakistan. It was Salala had happened, OBL had happened and the conversation was much more on that. Fast forward 2016 and the conversation is not just only about terrorism on Pakistan but it's also a lot about CPAC. What are the details? There's a lot of curiosity in the U.S. specific to this project which is somewhat an achievement I think and a sort of reflection of how the narrative around Pakistan is slowly shifting. The real question would be whether Pakistan is able to monopolize in this or not. I'm going to talk about the China-Pakistan relations first just to give a brief overview on what the relationship has been what is it right now. Also going to talk about the context of the CPAC and how we develop it I think because that's essentially very important to understand otherwise to understand the full value of 50 billion dollars it will be very difficult and the third thing I'm going to talk about the current status of the some of the projects that are there specific to the early harvest projects. CPAC Pakistan-China relations I think it could be divided into two phases one is pre-CPAC and the other is post-CPAC. In the pre-CPAC I think the relations were there was a lot more talk in the relations there was a lot more talk deeper than the oceans higher than the mountains sweeter than the honey whether there was substance in it or not I don't think the substance was as much there. Pre-CPAC the relations were very much India centric the conversation was a lot more about the security and on the precinct level there was also very little cultural ties. Post-CPAC I think the conversation has changed now we there is while there is a lot more talk but it is also substantiated by a lot more economic gains some projects and something to actually show in terms of substance the while India centric remains to be one of the focus the relationship is a lot more about the business centric economic centric as well. The third thing there is a genuine interest now in people-to-people engagement in cultural ties where I feel that the government is now in Pakistan a lot more interested to have Chinese center open allowing people to learn the Chinese language have exchange programs in the universities and we've really seen that China is now becoming one of the top priority places for the Pakistani students to go and study for their master's degrees or for graduate school and learning Chinese is now becoming one of the most I think fashionable things I have to say I think because that that that is how the economy in the world is going. So the conversation the pre-CPAC and the POSEC has now completely shifted and I feel that there is some substance in meat now when we talk about Pakistan-China relations for instance. The context of the CPAC I think it needs to be understood specifically in Washington DC. You need to realize this thing that CPAC the 50 billion dollars came at a point in Pakistan where Pakistan was struggling it was had an economic meltdown we had energy crisis no FDI no country wanted to do business we were lagging in sports we couldn't have cricketing matches in Pakistan no team would come to Pakistan to play and the country was becoming more and more isolated not just internally but externally as well there was polarization within the society what CPAC has essentially been able to do is not just have an influx of the money but it has kind of changed the mindset internally in Pakistan it has given a morale boost it has given a sort of confidence that we're still part of the international society which Pakistan's foreign policy has been mostly about I think one of the biggest worries of the Pakistan foreign insecurity establishment has been the fact that we might get isolated at one point and isolation is the biggest fear that the Pakistan security establishment feels CPAC has been reassuring because it has not only allowed Pakistan to inject a lot of money on the economic to turn the tide on the economic front but on three fronts I think has had an impact one in the real economic terms on how much you're going to gain out of this the projects the infrastructure the energy which I'm just going to talk in detail you have a whole new port and a whole new city being built by the name of Gawadar so that's one of the real economic impacts that you're going to see which has already been fed when I go back to Pakistan and I was working there I think the mood has shifted the economy has shifted where people actually feel now that there is business activity there is contracting the cement industry is growing every sort of industry linked to construction or energy sector is now booming so that's a real economic impact that we have felt the second one is based on the political and the stability front while there have been issues on the CPAC front specifically when it comes to the Balochistan the western route and the eastern route but it is understandable with such an influx of money coming in there will be rivalries there will be political battles and it will be politicized so that has happened but the reassuring part is that the institutions in Pakistan have been able to come together on this specific project there are ups and downs there are issues but large and holistically I think the the picture is safe for Pakistan at the moment the third part which is most interesting is the perception element I think CPAC alone itself has not only changed the morale of Pakistan but globally in terms of perception you have while I was still there the British government was actively engaging with us to be a part of the CPAC the French government had shown interest recently you have Iranian government showing interest so for Pakistan this is something that that's like a dream come true that you have a dearth of interest in Pakistan in terms of economics everybody wanted to talk specific to security when it came to Pakistan but now there is a genuine interest on the business side as well which Pakistan had been lacking for some time so that is the perception level you have ratings after ratings moody's standards and boars blooms work that has been putting Pakistan was stability front or on a positive front and then you also have KSE index the Karachi stock exchange this has been going in a hyperdrive and is rated one of the Asia's biggest medical in itself in the in the stock exchange so with these things I think there has been a lot of positivity that is coming out and I say and I repeat this thing a lot on the positivity front because the essentially if the people in Pakistan feel that this 50 billion dollar can change its fate which I personally feel that the Americans or the World Bank or the IMF have lost credibility in the fact that five billion dollars the Kerry Lugar bill or other materials other forms of fate had failed to deliver over the period of years I think there is genuine hope with this investment that something can be changed it is a momentum where the government of Pakistan and the people actually feel is going to be a fate changer a game changer that we like to call there are challenges there will be challenges when we talk about an injection of so much money there it will not be without challenges but my we can discuss the challenges as we speak but I would think for the government of Pakistan the biggest challenge would be how do you maximize the dividends out of this essentially such a project will change you to a certain point but the real challenge would be how much change are you talking about are you going to go to a potential of 180 or just stay around 30 which is easily deliverable so for Pakistan the real question is whether they can really milk this out or not and I think that will be the key on that front in terms of the projects I will also discuss that in detail but we have projects on the energy front 33 billion dollars of portfolio on the infrastructure we have almost 11 billion dollars and I just talked this morning with the with the president to see the status of the projects and it's very assuring that our early harvest projects are almost 60 to 70 percent completion with 2017 and in 2018 completion date we have solar power in Bhawalpur okay the asm solar park which is functional producing 400 megawatts already we have Kassim 13 20 megawatt we have Saival 13 20 megawatt coal fire power projects which are near completion already so there is it's not just the talk that is there but the speed has also been made in the past two years you have energy projects that have either been near completion or they're somewhere in the inauguration process and elsewhere you have recently as Nancy mentioned the shipment of the first shipment arrived on the in the gawadar port and that was done through the western route so there has been completion of road networks on the western front specifically from koeta down to gawadar and rotadero as well so the projects are there the physical impact can be seen on ground and we'll discuss that later on on how this will change the things on ground but I would like to end my initial remarks on here and take it forward from here into discussing the details of the project what may be the some of the challenges that will be coming I think Arif will be discussing specifically on that thank you thank you what I'll do is I will compliment Hussein's presentation on what exactly CPAC is what are the nature of the projects where the funding going toward and what are the objectives behind these various CPAC projects and then I'll give some brief make some brief comments on the likely impact of CPAC and then I'll address some of the barriers to implementation that don't necessarily represent an existential threat to CPAC but may slow the implementation or to some extent minimize the potential promise of this this this mega project so this what is CPAC and when I look at some of the early reporting on CPAC there was one news article that said that it was an $18 billion tunnel connecting China and Pakistan because the term corridor was interpreted very literally even right now many people perceive that there is this sort of linear route connecting China to Guadar the Arabian Sea port on southern Pakistan and that most projects are located along this corridor and this is there's going to be a synergy between some sort of new road network that is being built and various energy and economic projects that are being built along that line that's actually not the case so CPAC to a large extent doesn't really change the geography or the logistics network inside Pakistan it largely consists of upgrades to Pakistan's existing road network and so highways that are for example two lane highways or four lane highways are being operated into six lane motorways that are closed off and can enable speeds of let's say upwards of 70 miles per hour as opposed to let's say you know the current speed limits of around 50 miles per hour so one of the major investments is in a motorway that connects Pakistan's two largest cities Karachi and Lahore and so as part of CPAC one portion of this motorway project is being developed and so there are other funders that are contributing to the development of this motorway so for example the Islamic Development Bank is developing one portion another portion is being funded by a consortium of Pakistani banks so CPAC is is not something that it's not developing necessarily a new logic inside Pakistan it's utilizing an existing road network and upgrading it and improving the efficiency of connectivity between inside Pakistan between its largest cities and also between China and Pakistan and potentially beyond the region. Aside from certain projects connecting Guadar which are actually funded by other multilateral organizations or or foreign lenders or development organizations such as USAID or the ADB there's not really new paths that are being developed and so CPAC largely fits into Pakistan's development agenda around 76 percent of the CPAC funds are going towards electricity generation projects most of the remaining amount is going into infrastructure development of that of that spending on electricity generation 75 percent of the funds are going to toward or allocated for coal generation coal field power plants and so the the end result through CPAC and a host of other projects is that Pakistan will have a more diverse fuel mix in terms of its producing energy generating energy and so it's going to be moving away from costly diesel and diesel oil and furnace oil that it currently is its primary source of fuel generation so you'll have an influx of around the Pakistan Planning Commission estimates around 17,000 megawatts of energy will be generated through the first phase of CPAC through my own analysis maybe around 8,000 megawatts are more likely in the first phase but it'll help deal with the gap between supply and demand in terms of Pakistan's electricity market and also diversify it lower the costs and reduce its vulnerability in terms of fluctuations in the global energy market so you know those kind of elements those goals don't really offer much directly to China but what is China getting out of it these energy projects are all commercial projects so it's not you know it's not assistance it's investment and so Chinese companies have very advantageous margins that are being locked in through upfront tariffs and other incentives through CPAC the Chinese companies will be getting some loans that are not necessarily considered concessional but are pretty close enough so interest rates are around five percent so many Chinese companies due to you know excess supply in in China are moving outside the country and they're utilizing their own access labor and expertise exporting hardware and you know they will you know they'll be making quite a bit of money off of CPAC so this is you know a project that will address Pakistan's fundamental gaps in terms of its energy supply which has increased the cost of business inside the country a deterred foreign investment has really hampered its textile industry which is a major source of exports and making more viable and then you have these road connectivity projects which will increase the efficiency of its logistics network and make it perhaps more competitive with some neighbors some other states in the region that have done have seized quite a bit of market share from Pakistan in terms of the textile industry so Bangladesh and then a bit further away Vietnam so you know what is the likely impact I think when we look at CPAC you know CPAC is not the only game in town so CPAC perhaps will add 8,000 megawatts to Pakistan's electricity grid there's currently a short shortfall around 5,000 megawatts and demand is estimated to increase at about 5% a year but there are by 2020 there could be projects outside of CPAC that actually generate the same amount of electricity than CPAC projects and many of these projects involve Chinese partners so there's a synergy between CPAC projects and non CPAC projects they serve the same objectives of making Pakistan a more livable space a viable space for business hopefully will result in a revitalization of the textile industry and perhaps make additional value added industries more competitive inside Pakistan so including the you know home goods home appliances small manufacturing products and then heavy industries as well when it comes to the logistics networks you know CPAC actually might benefit the port of Karachi more than the port of Wather Karachi's Pakistan is home the Karachi area is home to Pakistan's two largest ports and the Karachi to Lower Motorway will will actually you know service Karachi's two largest ports so there's no direct motorway that is being connected to the city of Wather but in terms of Wather you know I think there is a huge variation in terms of Pakistan in terms of trying to identify what kind of niche it can find in terms of Pakistan's exports and even its own domestic market and I think the more sensible proposals have sensible visions have kind of centered on petrochemicals and the bulk break industry and these smaller niche industries that would you know service support that is you know far removed that a port that is far removed from major economic centers can kind of offer now in terms of barriers to implementation I would say that the greatest barrier at this point in time in terms of the sustainability of CPAC is Pakistan's inability to develop a sustainable consensus about the CPAC plan so that's not to say that there is wide dispute in Pakistan about the idea of CPAC itself about the idea of partnering with China to address Pakistan's electricity shortages and enhance connectivity between Pakistan and China and other regional states the conflict is over the details so many political parties and activists from Pakistan's smaller provinces feel that CPAC could be a train that will pass them by so what we have is a quite a unique situation in Pakistan where even ethnic nationalist parties that may have had separate tendencies in the past are very keen on partnering with China and receiving and benefiting from the influx of Chinese capital and having Chinese investments or assistance increase jobs provide electricity in their remote regions and improve the livelihoods you know there's an electoral benefit as well so if you know people from your area if the CPAC route passes through your area contractors or subcontractors will get that business and and if they associate that look that the fact that it was located there because of you might get some some funding in terms of you know the upcoming elections so it fits into the objectives of a broad segment of stakeholders inside Pakistan including the military as well as the mainstream political parties and regional ethnic nationalist political parties so there's a broad-race consensus in favor of CPAC but the smaller political parties feel that the the federal government which also runs and governs the largest province Punjab the Pakistan Muslim League Nawaz has essentially diverted much of the initial resources towards its own province so not just in terms of the road networks but also in terms of the electricity generation projects and there's a fear that this will have a generational impact because CPAC is a 15-year program and so in this initial phase some of the more developed regions of Pakistan will be disproportionately benefit from this funding and then that disparity will never be bridged over the course of time and it could in fact magnify and so as a result there have been a series of you know crises might be a bit of a you know excessive term to use but some some there's been some acrimony periods of high acrimony in Pakistan on CPAC and that has resulted in the prime minister of Pakistan and then sometimes smaller political parties they've organized what are called all all parties conferences in which a broad segment of political stakeholders get together and and discuss an issue and in this respect it would be CPAC and there's been a debate over the various routes because the belief amongst Pakistan's smaller political parties and and political parties that come from the three smaller provinces is that the original CPAC route was a bit focused on the western end of Pakistan and moved from Balochistan in through parts of Akhira Pakhamkhwa into Gilgit Baltistan but in 2014 there were reports of a new CPAC route and and and it looked as if it largely it largely aligns with the allocations that exist today meaning the Karachi Lahore Motorway which are now described as the eastern route and so essentially a compromised came about of the development of three routes an eastern central and western route and and so there has been still challenges in terms of ensuring that allocations are made for these various routes and that has served as you know point of contention between Pakistan's smaller political parties some of the opposition political parties and the ruling box on muslim ibn waz and so you know there's a challenge in terms of developing a sustainable consensus because CPAC is a 15 year project consists of three phases three five-year phases and ostensibly that would mean that there would be three different governments during that time period so assuming a new government comes to power and after 2018 if there are democratic elections and a smooth transition of power then you know working on precedent what we could have is that a new government could cancel previous projects change tariff rates and so on and so forth and you know there would be a decline in investor confidence in Pakistan and the future the future phases of CPAC could be put into jeopardy there are also challenges between the civilian government and the military or the army specifically in terms of securing CPAC so the army would like to play a lead coordinating role but the civilian government has not one has resisted in terms of conceding that space to the army and so it's actually withheld according to press reports funding for part of the CPAC security plan and that has kind of set back the plans to assemble and mobilize 16 000 personnel force to secure CPAC there are some other challenges in terms of institutional challenges like Pakistan we can get into that in the Q&A but you know a considerable amount of the CPAC funding consists of loans that are concessional but they're high in number and so Pakistan will need to generate a high level of economic growth in order to be able to pay payback these loans despite their despite the existence of some you know concessional rates and deferred payment it will still have to end up paying back these loans for infrastructure and even in terms of the energy projects which are largely commercial the Pakistani government will have to serve as a kind of a guarantor so that the payments are made in a streamlined fashion so that Chinese companies get their money back and so even on the investment side the Pakistani government has assumed some liability so if CPAC drives up growth in Pakistan the federal government will largely have enough funds to be able to pay back these loans but if growth continues to remain tepid we could see some problems in the future I think that's enough that's it great thank you very much so two views there on what's going on within Pakistan and now we'll hear from the Chinese perspective thanks thank you Jennifer for inviting me so first I have to apologize I just arrived last night after 14 hours of flight so I'm in this big jet lag and my head is still spinning so if I say something extraordinary outrageous please believe me those are all true so on the way here I took a taxi and I tried to get a grip of Chinese people's understanding of the CPAC so I asked the taxi driver what do you know about CPAC and he said yes I know it's a it's a huge project in Pakistan and so I said do you like it or not he said well that's a lot of money I don't know if it's good or bad so I said but do you think invest investing in Pakistan will be worth it he said yeah Pakistanis are all good friends so we should invest there so I guess that's that's a good answer so after I arrived here I took another taxi from the airport to downtown the taxi driver is very interestingly from Tajikistan actually it turns out he's a translator for the U.S. Army while in Afghanistan that's why he got the green card probably moving here so I asked him about Afghanistan too he said well there's still a conflict because Pakistanis are supporting Taliban in Afghanistan so I think so I asked him too would you know about CPAC he said yes I know so I said do you think it's going to be good for the future of both Pakistan and Afghanistan he said probably yes so I guess if both taxi drivers knows this projects must be good right must be at least has a very interesting impact in on a global stage my so first of all I want to talk about the reasoning or the motivation behind not only CPAC but also you know one Belt and Road project later on is called Belt and Road initiative they changed that name a couple of times in the beginning they called that a plan but later on they changed that to initiative because they first well first they believe they can do it as in domestic projects they can plan everything but then they realize they have to involve other parties particularly you know the real local owner of this project Pakistanis so they say oh okay now we're providing actually initiative not planning everything but coordinating with our partners so basically if we go back into history the real reason of the Belt and Road initiative is one of the biggest reason this is big is economic in 2008 after the economic crisis China the central government invested four trillion you remember to to save the economy and then the local government also invested about 10 trillion remember so all together is about two trillion dollars in just two years two to three years so after that there's a huge turnover you know there's a huge after effect of those investments those investments mostly goes into government funded projects that means goes into infrastructure and other related particularly power projects and that inflated the industry completely so it has this overcapacity all over the place and they cannot produce enough profit margin within China so they have to find a way outside of China so find another market and they right after that they came up with this idea of one Belt and Road to accommodate to have to develop market overseas particularly in the areas that there's no or not enough infrastructure and power planning so that's one reason and the second reason specifically for CPAC and also for the BCIM Bangladesh China India and Myanmar corridor another economic corridor another big Belt and Road initiative projects are what I call it locally driven because there are a lot of provincial initiatives that involved the BCIM is primarily conceived in Yunnan province where they wanted to find their own lane to access to the Indian Ocean and the CPAC is primarily promoted by Xinjiang province where they wanted to develop Xinjiang the western part of China and get that up to speed so one of the reason in that is because after 30 years of development there's a huge gap between the eastern part of China and the western part of China and they wanted to sort of mitigate and alleviate or match up the eastern part of China and one way to do it is to have more access to the international market for the western part of the western provinces of China and that two corridors is what they conceived for the future of those provinces so if you look at the map the one Belt and Road is east west in direction and then if you like to look at the two corridors is pretty much south and north and north and south corridors these two actually linked the landline and the sea line together that's a grand scheme of these projects and what they hope is to not only achieve economic but also strategic outcomes out of these projects so after I mean one another important factor came in late I think November 2011 when the Obama administration declared rebalancing towards Asia Pacific region which pretty much pushed China look westward and after that you can see and later on a year later there's this South China Sea dispute between China and the Philippines so China is facing a wall or a very strong resistance in the West Pacific and President Xi Jinping started to look west and they found opportunities particularly in Pakistan and also the Central Asia and also Africa that's where the plan started to shape so there's when Xi Jinping himself got involved and put CPAC as his flagship project on top of everything Belt and Road initiative that became China's political will to push forward so all the bureaucracy and you know everything state banks state-owned enterprises are all diving into those projects and investing billions of dollars in those projects regardless of the future returns actually so as you said there's a very low interest rate put on those projects and sometimes even lower than five percent if you go through the bank of import and export so right now I think after I mean two weeks ago when China declared the road between Kosh and Guadar has been passing through those routes Chinese domestic media celebrated the success of that and says that marks the success the initial success of the Belt and Road initiative so I think they will definitely continue on this road to develop the CPAC one thing is the China Chinese government is very well aware of the risks and dangers and economic I mean low economic returns of these projects but I think they realized putting this project forward can be an advertisement for the Chinese leadership global leadership and also China's willingness to invest in other countries and help them develop and the other thing is that Chinese companies from their perspective particularly state-owned enterprises they're willing to pay this as a tuition to catch up the learning curve and then to match up with other global companies multinational companies that are working globally and they're lacking this kind of experience and now they can use this opportunity to learn and to catch up so this too is kind of an important reason for China to continue to invest huge amount of money in those areas and lastly for the relations between China Pakistan and India it's very interesting I talked to some Indian think tank people just a couple of weeks back and a lot of Indians against this CPAC project and also the Indian government if you look at their proposal their concepts of development around the India Asia Pacific region they're proposing lines that are 90 degrees against Chinese lines for example when China has this Pan Asia railroad that is north south in direction the India will propose a east west channel cooperating with Japan across the south suites southeast Asia and also when China proposed CPAC India would also propose another line that goes north across Afghanistan into central Asia so this kind and also I think the the people I talked to suggested that the CPAC corridor should have branches not only going north south but also east west cutting through the borders between India and Pakistan and India is saying okay on the one hand they're very sort of vigilant and cautious about CPAC but at the same time they wanted to also participate but they're proposing actually we connect across each other and connect and then make the whole region benefit from this project so I think there's one mutual kind of distrust between China and India but at the same time there's a possibility of potential to cooperate with each other on these projects about Pakistan China now is kind of worried about CPAC a lot of Chinese are worried about CPAC because of when they get it more and more into Pakistani domestic politics they realize how complicated that is and they realize how this big project throw in the impact would be huge and they cannot control the outcome one thing is that they worried about is the conflict between the army and the civil government and also the other thing is about different regions where you have different ethnic conflict and religious extremism over there so they they worry about that and they try to balance those forces and also keep distance from the domestic disputes and try to maintain their kind of position over these disputes one thing if you look at Xinjiang that China worries about of course is the separatist also religious extremism in the Xinjiang area and Xinjiang province if you look at southern Xinjiang the demographic configuration nowadays is really very worrisome for the central government because now in Kash the beginning of the CPAC the city of Kash there's already I think over 97 96.5 percent of the population are just pure Uyghur population the Han Chinese reduced after the terrorist attack a couple of years back reduced from I think 6 percent to now 2.5 percent so they're starting to lose control of southern Xinjiang because the population shrink particularly the Han Chinese population shrink so they hope that CPAC and other Belt and Road initiative projects can revitalize the region kind of have it economically developed so that they can combat and reduce the possible extremism and separatist movement in the area and also attract more Chinese workers and Chinese companies to go into those areas and invest in those in those areas against the worry of terrorism so I guess I'll stop here and we can discuss later on more issues thank you all right moving on to Sarah for an Indian perspective and regional perspective great thank you that's an excellent segue into the Indian perspective I have a couple of slides for illustrative purposes but I can't see the screen so I'm nominating my colleague Sid who's in the audience this is a surprise hi Sid can you give me a thumbs up if you can as you see the first slide if I press this button I switched it up oh it was supposed to be off okay so you've all been looking at it it's not a surprise anymore I'm gonna go through what I see is the three principal Indian policy visions that stem from CPAC and from obor as a whole and each policy vision has a corresponding policy prescription the first as I see it is a Chinese Pakistan condominium which assumes a military aspect and the corresponding policy prescription is to be opposed to CPAC the second is a more optimistic vision that obor and CPAC could benefit as I said the region as a whole and then India could take part in it and the policy prescription that goes with that is that they should support CPAC and the final policy vision is Chabahar and the associated infrastructural projects in Iran Afghanistan and Central Asia as an alternative to CPAC obviously the policy prescription there is Bill Chabahar and the associated infrastructure projects so take them one by one the first point I think Indian concern about the possibilities for India of a closer India-Pakistan relationship is justified just in the past couple days we've seen reports in the Pakistani media at least of China's intention to have PLA Navy ships patrolling around Guadar we've seen reports that equally had to be taken with a grain assault that Russia which is one of India's oldest strategic and military partners is interested in getting involved in CPAC in a major way there I've been for years been newspaper set reports that the Chinese military has a pretty significant presence in what Pakistan calls Gilgit Baltistan and Azad Jamun Kashmir what India calls Pakistan occupied Kashmir the greater China's investment in Pakistan the more likely it is that China will be willing to break with its historical pattern of supporting Pakistan diplomatically and rhetorically in international fora but very firmly drawing a line between verbal support and actual military support in the case of a conflict with India obviously a two-sided war is India's nightmare scenario and I don't think you can really blame them for projecting outward in an attempt to forestall that happening the second response is that India will actually find a way to make obor benefit them and I don't know if anyone went to see Manoj Chosi's presentation on Sino-Indian relations at Carnegie earlier this week that was a note he was striking and in a sense because it's such an optimistic outward looking note it's great to hear it's in fact a little surprising to hear but when you do hear these statements they're rarely accompanied by a plan to make a reality so that's where my first slide comes in it's still up there I stole this from the reconnecting Asia website which is a project of CSIS it's really fantastic I would recommend everyone check it out this is their interpretation of China's vision for obor and including CPEC and what I think you can notice here is that with the exception of the Bangladesh China India Myanmar corridor none of these projects involve India in any way in fact if it had been designed to avoid India they were doing a pretty good so BCIM which does connect the city or is envisioned to connect the city of Kolkata in India with Kunming in China is very far from being a reality and in particular there's a 300 kilometer very mountainous stretch between the city states of Assam and Manipur in northeast in India that India has to complete so unfortunately I'm not holding my breath for that to be done anytime soon even if it were done that would be a corridor largely for the import of Chinese made goods from southeast China into the consuming states of northeast China even Kolkata is a very large city but it is not by any stretch of the imagination the industrial hub of India and in fact it's on the other side of the country from India's industrial hubs so even if India wanted to use a BCIM to connect to obor as a whole they would have to ship everything to Kunming and then connect to the larger obor products and go back west it wouldn't really be a cost-effective strategy so the bottom line is that if India wants to take advantage of obor and the possibilities that it represents it has to act it has to do something it has to put out tentacles you know even if they're intersecting tentacles so India builds in north south and China is building an east west corridor they connect with each other they can build on each other we aren't seeing a huge amount of plans by India to do that and certainly not a lot of action China isn't building obor out of the goodness of its heart it's building obor to get Chinese goods to western markets there's no reason why it should also out of the goodness of its heart create a path for India to bring its goods to western or southeast Asian markets so the next slide is India's vision is it change thank you I think the main takeaway from this slide is how much smaller scale it is and how much vaguer it is and in fact the good folks at reconnecting Asia from once I also stole this slide were forced to kind of put in some vague arcs and squiggles because they weren't even really sure what path despite their efforts some of these projects were going to take also I think it's important to note that there isn't a lot that India is going to do under this plan a lot of it depends on other countries so for instance the north south international transport corridor which actually has been around as an idea since at least 2001 you don't hear a lot about that outside India and if you want to make your future it's nice to not have to rely on Azerbaijan to be doing its part or Turkmenistan to be doing its part in a way relying on countries is suitable for India because it has limited resources much more limited resources in China but it makes its future much more contingent final policy vision is of the Chabahar port and the associated projects as a north south parallel that will allow India to connect to Afghanistan to Central Asia and ultimately to Russia and the Baltic states so the third slide I should say I'm going to go back one so Chabahar is slightly misplaced on this map it's a couple hundred miles to the east but the idea is that goods will be offloaded from India will get on a ship in Pune or on the west coast traveled to Chabahar be offloaded be taken by road or rail to the afghan iran afghanistan iran border at Ziranj where they will then take these irans del iran highway which india actually paid for and built connect to the afghan ring road so this map sits looking at it strangely but it's there okay sorry I said this is a long word journals map of Taliban influence in afghanistan it was updated as recently as october black is Taliban controlled districts and red is Taliban contested districts the two red dots the one on the lower left is iranj and the one on the upper right and to the up of that is del iran and what you can see is a del iran is right on the edge of a Taliban control district and there is yet another Taliban control district blocking off indian access to hara via the ring road and if you want to go south to kandahar it's really not that much better so the vision of Chabahar and his associated projects opening up afghanistan for indian goods is really dependent on a much more stable and secure future for afghanistan that we can see I can see looking forward at the moment you also don't see india doing a great deal to try and ensure that future either although it's difficult and it's doing more than it has been doing in the past but that's a long long road to home so I think in conclusion any of these three policy visions could with equal likelihood kind of ab ovo stem from india's plans indians and china's plans in south asia however only one of them will happen if india does nothing and that's the first one which is cpec and obor becoming an axis for closer china's packet china pakistan cooperation and really being to shut off india's market access to global markets or make it more difficult for india to access global markets the other two depend on india acting so therefore simply if you have three options two which depend on an action one of which will happen still be from inertia the one that happens from inertia is probably you know most likely so unless india really engages in a very concentrated program of infrastructure building and outreach over the next few years i think their worst imagination is more likely to come true than their more positive ones all right thank you very much to all four of our panelists that was a lot i think you did an excellent job covering the waterfront in a short period of time i've got a very long list of questions which i will not go through it all to give everyone else a chance to ask questions but i did want to start since you've got the afghanistan map up on that front so we talked about the the the chinese vision basically bypassing india and i know if you actually put that map back up it also bypasses afghanistan and so i'm curious if the panelists have any thoughts on what impact all this might have on afghanistan i don't know for all the reasons sarah mentioned that we'll see significant investments there but i'm wondering if you think there might be any spillover benefits either from on the economic front or if the cpaq investments will change the security situation in pakistan enough that it has spillover security effects in afghanistan so just be curious if anyone has thoughts on that well i think when you look at box i think afghanistan is pakistan's third largest trade partner second third largest trade partner and in the past year trade between the two countries has declined by around i think 20 to 30 percent that's part of a strategy by afghan president shabani to reduce his country's economic dependence on pakistan and perhaps use that as a lever to change pakistan's behavior towards afghanistan in terms of uh very security issues and so i think there's a desire in pakistan to integrate afghanistan and use afghanistan as a gateway to central asian republics and and link them all to both the guadar port and the crachi port but as long as there is this insurgency going on and also tensions between afghanistan and pakistan the possibility of further integrating afghanistan into um pakistan-based logistics networks uh is is pretty dim and uh at the same time afghanistan has actually increased its use of the chabahar port in terms of trade with india and also exports to i think to the gulf region so uh you know afghanistan um you know there's a you know a very optimistic vision of cpaq where it serves as a gateway for connecting pakistan to india to afghanistan to the central asian republics even iran um but that uh is um i think the economic promise of cpaq in terms of regional integration is really held hostage by the various strategic challenges that the region faces um and you know even with india for example uh the uh east western city um amritsar in Punjab the closest port for that city is actually karachi historically uh you know pre-partition they used to use karachi as their the port of choice so there's a possibility for uh connectivity in terms of east the east west route india boxon as well but unfortunately you know there's um the security challenge is really inhibit further economic integration uh i kind of agree with arif on this man i think as grand as the ideas and the strategy and the maps look uh on paper i think realistically speaking the government of pakistan is not thinking beyond balochistan and that too from a lot of difficulties for cpaq to pakistan i think the idea that somehow we're going to get integrated get afghanistan integrated into this or india i have not seen any conversation on that uh it is to a some level policy level there is a conversation that this will probably integrate pakistan into a greater regional debate but in terms of the projects in terms of the substance i think that is missing uh our concerns specifically the government of pakistan is to have some level of economic growth be able to provide that job opportunity to develop the infrastructure and i don't think they're thinking anything that is beyond pakistan's immediate concerns uh balochistan would be one of the concerns that have been integrated in the cpaq but beyond that i think we it's too early to talk about cpaq as producing or being able to change the world or change the region so i guess i'll ask i was going to ask you on that question um from the chinese perspective do you think um there will be significant belt and road investments in afghanistan or what what role do you think that will play uh just one follow-up and then i'll answer your question first of all uh to sarah i think uh not only china wanted export uh from china to europe and africa through this belt and road but also one of the biggest reason for china to build that is for energy security so oil from out of middle east and and shorter range to access to china and then also a safer trip safer access to the middle east oil and china is now i think surpassing us uh in terms of percentage imported from overseas and and i think over 60 of china's oil now from the russia middle east and africa so it's very important for china to secure that route and also to answer the question for afghanistan i think china right now is very cautious about investing more in afghanistan because the chinese government is still we still want to wait and see uh what would happen if the united states and nato forces withdraw from afghanistan how long the current government can sustain itself and the struggle between the government and also the titan forces are still going on and once the isis collapse in the middle east probably they will move eastward and there will be more trouble in the mountain areas between afghanistan and pakistan uh just i think a month ago there's a train from china going through china to hasakistan and then wuzbekistan to afghanistan so the train is already i mean the the railway is already accessible to afghanistan but once the train is there there's no internal railway to distribute the goods and there's only a road but no no railway so it apparently afghanistan needs a lot of infrastructure and a lot of reconstruction after the war but right now the environment as i agree with you that the environment does not allow that kind of project to like in pakistan to to open up all right so i'm i'm going to open the floor um to questions from the audience if you've got a question if you raise your hand and then uh when acknowledged you could stand up uh state your name and let's know where you're from and then um but we will start again um thanks um more user from usipi um let me just ask maybe either hussein or aref and then our other pandas as well so cpec we talk about china pakistan um sarah you talk about the essentially the india pakistan china competition if you will in that sense i want to ask about complementarities here um and the question i have is cpec is a north south setup various energy projects road structures um and anif and i were talking before offline that it actually naturally is set up in a way to complement a number of other things that are happening in pakistan there may be energy infrastructure or there may be other projects in terms of locations etc some of that is funded by the pakistan government but a lot of that is funded by you know the asian development bank the world bank the us and others is there a vision here that largely probably comes from the pakistani state but could be a collective effort which turns this entire narrative of china pakistan versus the rest around to say pakistan stability is in everybody's interest this is a major project here is how the others are already helping and thus rather than all credit to china all credit to everybody thank you come this is open for business you're still doing everything but you're doing it in a competitive way why not simply turn this narrative around to make it cooperative because ostensibly everybody wants pakistan stability and then on india which i think is rightly worried if this is where this is going i think if you want to change this entire paradigm the the silver bullet here is india trading through pakistan and if pakistan can allow that then you have that overland access you have the port access and actually benefits pakistan tremendously because the shabar and everything die a natural death because it's not economical anymore and then you've got real cooperation north south east west and to me it's a narrative change and if everybody can change that narrative it probably forces india and pakistan to look and see whether they can make that happen as well thanks i think the first part that you talked about pakistan has been actively talking to the united states at least that i know of to be a part of the cpec cpec agenda they have had the discussions with the british as well and the the interest is to build that momentum like you mentioned to have that sort of momentum to take the cpec forward and have the other countries pegged to it but there are also potential problems with it i think and that might be from the chinese side for for china i think cpec is a poster project and they would like as much as possible to have the big tag on that and for pakistan it actually also works the more you dilute cpec with for instance other countries and there the chinese name itself which sells in the markets it sells around the world in trade and everything i think pakistan would like to make sure that it is pegged around that but it doesn't want to completely cut out everyone which is why we see that pakistan has been reaching out and frankly speaking the other countries have been reaching out pakistan or that but they would rather have this one big country which is the name right now to be at the center and have the other countries spiral around it but they would not let or i don't think the chinese would either would want to have it get diluted as well from the from the indian perspective i mean obviously there would be have to be enormous paradigm shifts on both sides it takes two people to make the fight and it also takes two people to trade right so you'd have to if in order for india to want to abandon its plans for cabajar make a long-term investment in you know an assumption that they are going to be going through pakistan they would have to believe that that border post isn't going to be closed at the slightest provocation and i think that in terms of this being a win-win situation for everyone in the region one of the things i'm really looking at is is this a project that's going to strengthen the civilian democratic institutions in pakistan or is it going to strengthen the military institutions right now i think we're seeing is a certain amount of military rent seeking in which they are actually building up their budgets by the justification being oh that we need to protect cpec so this could be something that could become that the civilian democratic institutions could really own and could say look we provided this to you that might help it strengthen pakistan civil society and i think that could really make it a beneficial project for the region i'd like to respond to that because that's i think very important and i don't want to miss that there's a certain perception that somehow the military is very much actively involved i've been part of the project since its inception and it is fair to say that the project was developed visioned and has been completely implemented is being completely implemented by the civilian side the military's only concern was that they felt that the space was so quick and was being done in such a quick way with the chinese that military could not get the information and as soon as the government of pakistan was able to have the military on board have their senior representation sit in the steering meetings i think that has also been solved but the project by itself is specifically being done led by the by the civilian side so i think the civilians institutions i'm not sure too too much about the institutions itself because that's another debate altogether how it's going to impact bureaucracy the deliveries but at least the civilian political establishment will be taking the eventual credit the ownership of this project on the security side i think it was not it is actually the other way around it's not the military that was trying to make money out of this it was the government that actually asked the military that we need to deliver in balochistan and some of the institutions that can actually deliver in balochistan was actually the military so so the government of pakistan ended up contracting a lot of work to fwo federal works organization which is run by the military specifically for this cause because it was not able to develop projects in balochistan so the military took over of that so i think there is there isn't any civil military tension and i would like to clarify that perception as well that there is somehow a perception on that can i have three fingers if you want to okay very briefly i mean i think the two reposts of that are one the first ship that went out of guadar had a military escort the entire way from khujarab and a naval escort the minute it went to sea and the second question is if it really is a military the project isn't being militarized why did they raise it was a 15 20 000 man security force for this as opposed to you know what india has a central industrial security force which is a civilian controlled police organization i think the first part just was the first part why they had the military convoy partly because it was an inaugural project so you take the military along just to make sure it is provided security but i don't think every shipment or every single thing will be led by the military convoy i think it was just to start off and all right obviously lots of talk i saw lots of hands so what i'd like to do is take a collection of about three questions and then let our panelists respond so we could try to get more questions on the table so go ahead in the back and she's got a microphone for you all right not loud enough kamran bohari geopolitical futures um so this is to anybody but directed at sarah specifically um did i get the name right that's right okay perfect so cpec is already in motion um it has its challenges largely related to the security within pakistan situation and and the political instability and of and of course afghanistan but shabahar development of that port involves the iranians and then the extension to central asia has stakeholders the central asian stakeholders and to an extent russia as well so it hasn't even gotten off the ground yet and there are so many logistical issues that have to be dealt with in terms of infrastructure just pure infrastructure assuming everything else runs fine so i want to get your thoughts in terms of then how can that sort of serve as an alternative or a counter if i heard you correctly i don't know if you made that argument uh to uh the the cpec thanks all right one another question uh my name is umar i'm in the state department emerging global leadership in asia to fellow from pakistan and i belong to the khaibar pakhtunkhwa the southern part and tribal area of pakistan so uh my first question like i would ask hossain in rf like how much pakistan internally is unified ansi pak and you think like khaibar pakhtunkhwa and federally administered tribal areas are the one which are mostly affected by militancy and if you see the tribal belt like ten um more than ten million population their education ratio for female is only seven point five for male it's only 22 percent how the government of pakistan doing for for them they are the ones which were the mostly affected and if you see government of pakistan has started orange line metro in lahore which is already in construction and they are spending 1.6 billion dollar on orange line and what they did for the most affected areas of pakistan are we internally unified on this thing are they are doing something for those which are mostly affected is it will not create the the head factor again what are like the government pakistan is doing for us let me start exam i can respond to that very valid points 100 percent 100 percent agreed to you on that uh two things to this first thing you ask whether there is an agreement or consensus on cpec there is 100 agreement and consensus on whether cpec should be there or not so every political party everyone wants to get the maximum benefit out of it the consensus where there is a problem is the logistical part so cpec whether should be there or not it's already there is a consensus on that now we do have a problems with initially we had problems with the root specific projects but to a lot of extent that has been cleared out in balochistan for instance we had the maximum number of projects right on to cpec 16 in kpk we have eight projects in in panjab i think we have only nine projects in panjab we have 12 projects and since we have around 13 projects yeah so so cpec do have the projects for the provinces uh on the orange line because it's a controversial issue and i agree with you on that there are problems it's not just related to cpec it goes back to the history of pakistan where we talk about the balochistan the development of balochistan they have serious issues the worst in my opinion the development issue in pakistan is actually the interior center as well it's as bad as the pharta region itself so whether the government is doing anything or not it it is yet to be seen whether there is an interest there is an interest the orange line metro comes under the tag of the cities as the engine of growth you see that is the provincial government taking ownership a lot of these issues have been devoured the infrastructure the energy the uh the the development self the education has been devoured to the provinces so if you have one active chief minister of panjab who is uh who is ganghu about doing the development projects it is seen by the other provinces as somehow being taking their fair share which is not the right thing by the way the the pharta is a different ballgame altogether because they have genuine political grievances they don't have a sort of representation the reforms are badly needed whether the government is doing something or not they have started the reform project but i personally in my scholarly opinion i think the cpec should not be equal i agree with you i would say that i'm done it should be unequal in favor of the marginalized provinces it has to be given i mean you cannot justify that just because you've given 16 projects to balochistan or two projects to pharta it is enough we need to give them unequal share in favor of them and that is where i think the difference will be it will take time i don't personally think that it is going to be done overnight the reforms first have to be there in order to change anything on ground but the comparison between the orange line and the other thing i think it's not fair because that has a completely different tool to it it's provincial matter and i'll be i'll also mention this out very clearly 18th amendment has been somewhat a big problem for pakistan as much as i support the devolution it was done in haste it was done in a way where the tors the logistical sides of it was not decided who's going to do what what ended up happening was that nobody knew the provinces that what they were doing on education part or what the central responsibility was so we're still grappling with what exactly is the role posterity in the amendment of the federal and the provinces and there has to be the government and the provinces have to come to terms with that so i think your points are completely valid and the government has to become more sensitive to the communities and to the marginalized communities in cpec and i initially mentioned this thing that that is going to be the biggest challenge for pakistan whether you were able to maximize the benefit for the marginalized communities as well but should be the focus just quickly i mean i think to some extent the sentiment that's expressed in in terms of your statements reflects i think a confusion in pakistan as to what exactly cpec is it's not a marshal plan it's not a development project it's primarily investment that is coming from china into pakistan so the economic viability of the projects are an important consideration um with that said you know there have been at times in terms of the orange line it you know it's a to some extent it's a slap in the face to that's a slight to pakistanis from smaller provinces because you know the orange line project is economically viable it has um you know a purpose in terms of urban development of pakistan but it has no linkage to regional connectivity or intercity connectivity and at the same time you know it probably will require around a hundred million dollars a year in terms of subsidies so it's not necessarily it's a sustainable project but it's going to require huge subsidies from the state so why could that have been done for let's say a project outside of pakistan's core belt areas um but at the same time you know you have a government that has um you know kind of favored um in terms of projects where its constituency is so the p m land is based in urban pendab and that's also where pakistan's industrial centers are so if you look even the energy projects you know the government has tried to list you know there are x amount of projects in this province y in this mount um but you know the energy projects and in terms of the transmission are oriented around pendab so that energy will be maybe it'll be developed in synth but it'll be you know transmitted up to pendab and there's an economic purpose for that and uh there's a you know uh and there's a utility to it but at the same time there needs to be some compensation that's made to smaller regions of pakistan can it wait just a second okay so what i what i want to do because i know we're running out of time is um i want to see if there are more questions on the floor and then if those can be done briefly then we'll go back and let give everybody probably about a minute to respond to the various questions and any final comments that you want to make so well if you can make your questions brief then we'll probably have more time to answer them so thank you in advance andrew you go first uh yeah thank you very much um and again i think maybe first question hasane and are both you're pretty upbeat about this and i guess if you just speak briefly to the issue of expectations management because as you say this is the poster child now it's high expectations often in these context expectations aren't met so even if it's a positive benefit um it might not be as positive we're already hearing it's generating uh you know controversies as well as the positive benefits that's the first one and secondly just coming back to moe's point which has a peace institute i want to link it back to the peace issue um we haven't really touched on the issue of so much on the security side where i think some of the assumptions i think especially some of the from the chinese government side is that the economic growth is going to be a key driver of stability in the region um and yet a lot of the evidence shows however that that's not the case more resources can be more resources to fight over as we've just actually heard in the room and so i think that assumption i think is i would challenge um whereas the key driver of conflict for me in pakistan and south asia at large is the indopak one and so again coming back to this issue of how to use cpec to again link more the east west quarter link it to that with the indopak peace which i think economically makes a lot more sense um i think that's where you get the greatest peace dividends which would contribute to stability in the region including afghanistan out of which you then get your economic returns on your investment but i think investing purely in pakistan which on one level is getting more and more internationally isolated as you build more and more roads and power plants i mean i think there's a bit of a contradiction there unless we can deal with the fundamental driver of conflict in south asia which is the indopak one and if you can deal with that and get more economic growth in south asia and get one more than a billion people with more money and resources i think that's the real win win in the region including for china in terms of markets for chinese investment so thanks i know we had one more question in the back these don't okay another new york i'll make it very quick two quick questions one how do western or other non-chinese non- pakistani firms compete for work either building the corridor or making investments alongside it in number two something that's been missing we've heard every country in the area mentioned but there's been no mention of really um turning this over to the market in providing some type of let's say governmental incentives uh or competition in allowing the marketplace to determine where to build the routes and how to compete for business like we did in the us back in the late 1800s thank you great one more question for we go yes hi my name is jimu from institute for global engagement and this question is directed for mr heitzel um so there have been attacks on uh chinese workers in the pakistan as recent as last week so i'm just wondering what's your take on what the chinese government is going to address this challenge thank you okay so we've got a number of questions on the table we've got chabahar as a counterweight expectation management um more resources leading disability the indopak relationship non-chinese firms competing market forces and the attacks on chinese workers so everybody wants to take about a minute to respond it would ever resonates most with with you and what you want to leave folks with before we close today that would be terrific so i think what we'll do is actually just go down the line sarah we'll give you the last word i'm saying do you want to start i'll answer the expectations part i think because that's where i pakistan and the us has been suffering a lot as well on the expectations part is the the way the projects are being done it has to be taken into understanding the energy projects have been done under ipp mode uh the the the infrastructure projects are being done in the egc mode now it is not the fact that the money is somehow going to come it's going to get delayed under the ipp mode and then the egc mode the projects are the money is being given by the chinese to their own contractors to their own construction firms so they're the ones who are developing it the role of pakistan is to provide the basic platform and the basic i would say uh support in terms of that in the real economic terms the expectations will be met when you talk about the expectations it will not be something like we have had a previous engagement with the us or with the world bank where half of the time people thought that the money was going into the politicians pockets with these projects you can actually visibly feel the development the road the karachi loha motorway segment the uh the uh the load shedding being reduced you will actually be able to feel that the second part on the expectation point is also this thing that the starting from the project this project became kind of controversial so i feel that in pakistan the expectation is that the disc project is somewhere in the difficulties it will happen it will deliver but there will be problems the perception generally is that it is not taken as a project that will somehow be done very quickly or will start producing results right away so i think the perceptions are there uh the expectations i think on both sides are very clear because the conversation is going on a very high level and the the deliverables are actually something that you can see visibly and you can have uh you can you can already see the progress of the projects and i think the expectations are can be met on that the india pakistan i think the women's situation i personally am of the believe that for pakistan the biggest challenge is how are you going to make sure that this project can be done in a smooth and peaceful way where you have india which somehow has been very loud against the project for some reason how do you bring india into this equation i think that will be a big question uh into specifically the cpec or developing in another route with india because i remember the prime minister shree when he formed the 2013 government his major focus was not china his major focus was india and that i think still is in the back of the head and i don't think the p.m shree will be interested in letting that go because essentially the political party and the prime minister realizes the significance of working with india to bring about the peace dividend in the in the goal and i agree with you that that is a central component which despite the cpec project will if it keeps on lingering we will continue to have problems all right 60 seconds i think i'll deal with the gentleman's question in terms of i don't think there's much space for non-chinese companies to play a role in terms of cpec projects directly china's goal is to help you know export its oversupply so or over capacity and so it's essentially to some extent it's keeping its white elephants afloat through you know through these initiatives there is one project in which it's a joint venture between a chinese company and a cut three investment fund and so maybe perhaps a prerequisite is that you know a let's say an american company partners with a chinese company but you know there are a lot of complications in terms of those sort of joint ventures at least on this side of the atlantic in terms of the private sector you know these are largely projects that are conceived and tendered by the government of pakistan especially in terms of infrastructure so you don't really have the direction is led by the government there's private sector involvement so many of the projects are build operate transfer and all that and the energy projects are private projects in which electricity is sold to the national to pepco the pakistan's national electricity company the distribution company and so you know there are potential opportunities in that respect but you know it's it's not it's ultimately it's state led and there are partnerships where with private enterprises if they want to come on board now private sector companies could for example set up in these industrial zones that will be established and throughout pakistan they can set up a set up plants that leverage the energy connectivity the logistics networks and and and receive indirect gains from that so i think that's where perhaps american companies western companies can can benefit from cpec all right thank you hi i want to follow up i think there's a ways for american companies to participate not just cpec but also belt and road initiative as far as i know like ge and caterpillar all having a joint venture or some kind of an investment in this chinese companies can be general contractors but there are subcontracts to be made money to be made in those projects to answer the latest questions about chinese personnel security and also you know facilities security in afghanistan i think chinese government mostly relied upon local governments protection and also pakistan's military to secure the location also personnel's there's a great debate right now in china there's chinese security firms pushing for reform and legal and legislation to get licensed to go overseas for security purposes but right now it's stuck there's no further improvement on that front because not many foreign governments would allow chinese security firms to carry weapons in those countries so it's very difficult for them to acquire that kind of capacity so but but still chinese a minister of foreign affairs has improved his concert of service for chinese citizens so if something happened they will pull them out right away no matter how much money they spent so i think that's probably the only way they can do it for now thank you great having the last word um so briefly in chabahar i'm not gonna get up here and chat for chabahar i think there are a lot of questions but in india's defense they were prevented from working on it for many years because the sanctions on iran once the sanctions were lifted india has moved fairly fairly quickly and they signed a deal in may uh there is construction there there is a port there it's not starting from whole cloth and they're working with a relatively high capacity partner which is iran so obviously everything has to start somewhere it's not a repost to guadar yet but it could be down the road especially if things quiet down in afghanistan uh the second thing i would say in terms of um bringing india into the cpec equation i think the day that the pakistani prime minister is the one in pakistan setting india policy is the day that india will seriously consider joining cpec it's the last word so all right wonderful um well i wish we could stay for much longer because i think there's a lot more to talk about but really appreciate everyone coming today thank you very much to our panelists um for sharing your thoughts i think this was a terrific discussion thanks to the audience for your great questions and a special thanks to jennifer chang and rachel vandenbrink for organizing all of this um thanks again for coming and we hope to see you at another event soon