Pakistan PM Imran Khan tries to rally support for Chinese investment during China visit

Pakistan's Prime Minister Imran Khan (pictured) will meet Chinese President Xi Jinping, Premier Li Keqiang and business executives in his third visit to Beijing within a year.
Pakistan's Prime Minister Imran Khan (pictured) will meet Chinese President Xi Jinping, Premier Li Keqiang and business executives in his third visit to Beijing within a year.PHOTO: REUTERS

KARACHI (BLOOMBERG) - Pakistan's Prime Minister Imran Khan began a two-day visit to China on Tuesday (Oct 8) to help rally support for more investment after project spending declined sharply.

Mr Khan will meet Chinese President Xi Jinping, Premier Li Keqiang and business executives on his third visit to Beijing within a year. He will likely discuss railway projects and trade curbs with the officials, while also addressing concerns around the contested region of Kashmir, ahead of Mr Xi's visit to India later this week.

Pakistan has been one of the largest beneficiaries of China's Belt and Road Initiative, Mr Xi's flagship programme to build a network of railways, ports, pipelines and highways linking Asia, Europe and Africa. China has financed billions of dollars of power and road projects in Pakistan, boosting infrastructure in the South Asian nation but also saddling it with debt.

While most of the early projects have now been completed, the second phase of the programme has been slow to start. Official data shows foreign direct investment from China plunged 77 per cent to US$461 million (S$636 million) in the fiscal year through June, from US$2 billion in the previous year.

Pakistan's debt problems, which led the government to seek a bailout from the International Monetary Fund (IMF) once again, have also prompted the nation to scale back some projects. The South Asian nation owes China more than double what it owes the IMF over the next three years.

China has sought to tighten oversight of Belt and Road projects amid growing concerns the programme is loading poorer nations with unsustainable debt.

China's ambassador to Pakistan, Mr Yao Jing, recently said the economic corridor projects between the two nations are "running according to our satisfaction and there is no slowdown in it".

Pakistan has reduced its Chinese loans to upgrade a colonial-era railway by US$2 billion to US$6.2 billion, and wants to cut it down by another US$2 billion, according to the nation's railways minister.

Mr Khan will likely discuss the project during his trip to Beijing this week, as well as Chinese curbs on agricultural exports from Pakistan, including on rice, wheat, corn, soybean, sugar and tobacco, according to state-run Radio Pakistan.

 
 
 

Regional security will also be on the agenda, with Mr Khan expected to discuss the situation in Kashmir with Mr Xi before the Chinese leader visits Indian Prime Minister Narendra Modi later this week in the southern state of Tamil Nadu.

India scrapped decades of autonomy in the Muslim-majority state of Jammu and Kashmir, straining relations with Pakistan. Kashmir, in the Himalayas, has been divided between India and Pakistan since independence from British rule, and is claimed by both. Two of the nations' three wars were fought over the territory. China also claims part of the area.

Mr Burzine Waghmar, a member of the Centre for the Study of Pakistan at SOAS University of London, said Mr Khan will unlikely get strong assurances from Beijing on Kashmir.

"Xi will definitely not publicly proclaim questionable objections about Article 370 and Kashmir on the eve of his informal working visit to Tamil Nadu on the heels of hosting Khan," he said, referring to the provision in the Indian Constitution that had granted Kashmir special status.