Daily Times

The China-Pakistan Economic Corridor (CPEC), referred to as a ‘development package’ from the government of China to Pakistan, will expand Pakistan’s road and rail transport infrastructure, energy production, project financing and ‘intelligence transfers’- currently worth $ 45 billion — more than half of which are to be developed before 2018 as an ‘early harvest’. Following successful lobbying by the Pakistan government since this project was first proposed in 2013, the interest rate for the loan from the Chinese government to the Pakistan government has been reduced from three percent to a heavily subsidised 1.6 percent.

The reasons behind China’s investment in strategically placed Pakistan has much to do with its revised approach to foreign policy, taking a more proactive approach to its involvement in the geopolitics of the region. Most importantly, the CPEC will be an extension of its 21st century Silk Route initiative, now known as the ‘One Belt, One Road’ initiative, which will provide China direct access to the Indian Ocean through which it receives up to 70 percent of its energy and trade imports.

From an energy perspective, the CPEC is investing in renewable energy projects such as the $ 1.6 billion hydropower project in Karot, the $ 1.2 billion solar power park in Bahawalpur and the $ 260 million 100-megawatt wind farm in Jhimpir. However, the total investment in renewable energy is dwarfed by investment in dirty, coal powered energy: $ 2.8 billion for developing four coal-fired stations with a capacity of 1,980 megawatts in Thar (Sindh), $ 2.2 billion for two coal-mining blocks in Thar (Sindh), two billion dollars to develop coal-fired generation plants at Port Qasim Karachi and two billion dollars to build a natural gas pipeline between Gwadar and Nawabshah, then connecting to Iran.

The CPEC has been met with scepticism by some and welcomed by others. However, for Pakistan and China, both countries that have been in the limelight in the climate change arena for the wrong reasons, this blatant investment in fossil fuel heavy energy should raise alarm bells. Economically, Pakistan has it sights set on becoming the 25th largest economy in the world; its ‘Vision 2025’, an economic roadmap, aims to achieve this through “human resource development, regional connectivity, knowledge economy, inclusive growth and shared prosperity”. And whilst the roadmap does take into account the “looming threat of climate change”, on the ground, the very real threat of climate change to Pakistan is not reflected. Pakistan’s recent, very dismal submission of its Intended Nationally Determined Contributions (INDC) to the UN Framework Convention on Climate Change (UNFCCC) reinforces its actual lack of commitment to the issue. As a low emitter, Pakistan has frequently stated its priority to adaptation but if it is to achieve its goal of becoming the 25th largest economy, it is important to connect the planned economic growth targets to account for projected carbon emissions.

China, on the other hand, despite the slowing down of its economic growth rate over the past three years, is still the second largest economy in the world and experts have indicated that the slowing down of the growth rate does not mean that it is on the verge of collapse. China is also the world’s largest emitter and its INDC, submitted in December 2015, was one of the most highly anticipated, pledging, among other reductions, to reduce its carbon intensity (CO2 emissions per unit of GDP) by 60 to 65 percent below 2005 levels by 2030 and increase its share of non-fossil fuels in primary energy consumption to around 20 percent by the same year. While China is shifting from its heavy reliance on coal-fired energy towards renewable sources, its investments in Pakistan do not necessarily reflect this.

For developing countries, emissions reductions are alarming as they are perceived as barriers to economic growth. It is increasingly clear that the climate cause and economic growth are not mutually exclusive, and this is particularly pertinent to note in the case of the CPEC. Both countries face pressure to commit strongly to the climate cause, whilst both also are faced with unique opportunities for economic growth.

Pakistan was unable to submit a meaningful INDC in December 2015 at the Paris Summit due to the lack of an established baseline. While the country works on developing this baseline and crafts its contribution, it is an opportunity for the country to showcase its commitment to the climate cause through its investment in renewable energy as well as its award winning efforts at reforestation. Similarly, China has very publicly announced its intention to move away from coal as an energy source and investment in renewables has the potential to demonstrate this.

That said, we are still left with the reality of China’s massive investment in coal-based energy in Pakistan and the Pakistani government’s encouragement of this. Pakistan faces a huge energy deficit that arguably takes precedence over any sort of international commitments to the climate cause. However, it is imperative at this fledgling stage of the CPEC for Pakistan to agree with the Chinese government on a carbon/emission trading mechanism that will offset the carbon cost of this venture, before it is too late.

The writer is a freelance columnist