CPEC FOR BETTER OR FOR WORST?
ISLAMABAD: The significance of the construction sector of Pakistan has been of utmost importance as of late. The construction industry plays a vital role in the economy and development of Pakistan. And over the course of years we have seen and experienced its importance. According to many studies and statistics by the Pakistan Economic Survey, construction industry accounts for 2.53% of Gross Domestic Product (GDP).
Over the course of 7 years Pakistan has experienced an overall growth in the percentage of investments in the construction sector.
The construction sector is a major labor extensive sector. It is a tried and tested way all over the world that this sector in specific the construction is the most optimal solution to kick-start an economy.
Although officially, on typical, the construction sector has backed between 2.3% and 2.85% in the last five fiscal years to Pakistan’s GDP, most economists assess its value to stand between 10 and 12% of the total GDP. This is for the reason that it delivers incentive to over 42 secondary sectors including aluminum, brick, cables, cement, fixtures, glass, kitchen and bathroom fittings, marble, paint, steel, tiles, transportation, warehousing and wood. Therefore, it has a far-reaching impact on the overall economy as it employs eight percent of the total labor force.
But even with such investments and an extensive display of growth as of right now, Pakistan is fronting an overall shortage in housing of up to 10 million housing units. Urban housing scarcity is probable to be 3.4 million housing units, while rural housing absence is over 7 million housing units. And this too will increase overtime as time moves forward.
Now CPEC entered the limelight back in 2015 when Prime Minister Nawaz Sharif gave the go for the “China Pakistan Economic Corridor”, to Chinese officials along with President Xi Jinping. Originally valued at $47 Billion, the value of CPEC projects is worth $62 Billion as of 2020. CPEC is intended to rapidly upgrade Pakistan’s required infrastructure and strengthen its economy by the construction of modern transportation networks, numerous energy projects, and special economic zones.
Ever since then notable presence is been witnessed in Pakistan regarding the administration of Chinese officials over the project itself. The CPEC project will begin with the development of the Gwadar deep seaport and will target various sectors such as energy, education, health, transportation etc. That all together will accumulate and boost Pakistan’s economy.
This in return has given rise to numerous speculations from around the globe and by the populace of Pakistan as well. Regarding as if the amount of trust and control that has been put into the Chinese officials to spearhead the operations will prove fatal or fruitful in the coming future or as to whether there are ulterior motives hidden behind such projects. China’s economic promises to Pakistan have not always come to fruition. Between 2001 and 2014, China pledged $135 billion to Pakistan, only 4 percent of which materialized.
The lack of transparency regarding the terms of CPEC loans and investments still worries many Pakistanis this in return is the utmost duty of the government officials to keeping the public updated and notified regarding in query or concern.
Regardless of such speculations, due to this project Pakistan has been benefitting from the progress of the operation. Within itself the Construction sector of Pakistan has experienced immense growth and investments over the course of years. Which has paved way for the progress in many other secondary sectors such as that of raw materials.
Now the question that stands is even with such developments how will the operation itself benefit the construction and real estate sector of Pakistan?
Think of it this way, CPEC main agenda is to create a safe pathway connecting the European, Middle East and African states to China making it the hub of all economic and trading activity. These pathways will majorly pass through Pakistan all the way over to China.
Now that Pakistan is in the picture of the great economic activity many foreign investments will be made and are being made even before the project is completed.
Many real estate housing society’s such as Capital Smart City are being sponsored by the Singaporean construction company Surbana Jurong.
This has proven that due to the presence of CPEC and the greater investments plans of China, Pakistan is being considered as the most pivotal point for all business opportunities in all sectors especially the construction and real estate.
Therefore even with such contradiction CPEC has paved way for Pakistan’s growth. With China as the rising superpower and the near futures new Economic Hub and Pakistan playing as its closest ally, immense growth and great deal of investments can be expected over the years. Even with the continuation of the pandemic Pakistan will survive and can survive n endure only through further regimes and reforms that will help ease the function of the construction and real estate sector of Pakistan in order to help the economy flourish and recover.