China denies CPEC projects are debt trap for Pakistan, vows to further boost corridor

China on Tuesday denied that its projects under the US dollar 60 billion China-Pakistan Economic Corridor (CPEC) are leaving Pakistan in a debt trap. "It has been more than five years since we started the CPEC. We have made important positive gains," Chinese Foreign Minister Wang Yi said in his joint press conference with his Pakistani counterpart Shah Mahmood Qureshi after their first strategic dialogue. The CPEC, which connects Gwadar Port in Balochistan with China's Xinjiang province, is the flagship project of Chinese President Xi Jinping's ambitious Belt and Road Initiative (BRI).

"During the dialogue, the two sides undertook in-depth discussions on all aspects of bilateral relations, including China-Pakistan Economic Corridor, trade, investment and economic cooperation, people-to-people contacts and regional and international issues," read the statement.

Wang said 22 early harvest projects have been quite successful and have significantly improved transport and infrastructure and power supply in Pakistan.

"It created tens and thousands of jobs in Pakistan. They are playing increasingly important role in social economic development of Pakistan enhancing people's well-being," he said. 

Answering a question over the criticism of the CPEC projects amid reports that Pakistan government plans to slash certain projects over concerns of debt burden, Wang said that Chinese projects have not resulted in enhancing Pakistan's debt.

"Among Pakistan's foreign debt, more than half of it comes from multi-lateral agencies. More than 80 per cent of them use direct investment from China or Chinese grants. None of these contribute to debt in Pakistan. Only 20 per cent CPEC projects uses Chinese loans. So instead of adding to debt burden to Pakistan, the CPEC projects have contributed to greater strength, vitality of Pakistan's economy," Wang said.

He also said the CPEC projects have spread to all most all parts of the Pakistan, refuting criticism by some of the provinces that projects are being garnered by the dominant Punjab province.

As for the concerns expressed in some media, the CPEC has already entered all parts of Pakistan rather than limited to specific areas, Wang said.

"While rejecting the negative propaganda against CPEC, they expressed a strong resolve to safeguard CPEC from all kinds of threats," said the foreign affairs ministry in the statement.

"According to our plan future development of the CPEC, there will be more projects in other parts in Pakistan including western part of Pakistan which will benefit Pakistan people," he said.