Pak says no to free use of Yuan for CPEC projects

The senior officials from Pakistan and China on Monday decided to formally move ahead despite hurdles and finance at least three special economic/industrial zones

Pakistan has refused to allow free use of the Chinese yuan on the lines of the US dollar in the country as officials from the two nations met to decide on a long-term developmental plan under the China-Pakistan Economic Corridor (CPEC).

The meeting of senior officials from Pakistan and China on Monday decided to formally move ahead despite hurdles and finance at least three special economic/industrial zones (SEZs) and some important rail, electricity and road projects.

The Dawn reported quoting a senior government official that Pakistan was not ready to allow the Chinese yuan (renminbi) for free use in Gwadar or its treatment on a par with the US dollar in the country and this was disappointing for the visiting Chinese officials.

He said the use of yuan for common use in any part of Pakistan or exchangeable like dollar has to be on a reciprocal basis.

The official also said the issue would be discussed again for some kind of institutional arrangement at the CPEC Joint Cooperation Committee (JCC) meeting on Tuesday to be co-chaired by Interior Minister Ahsan Iqbal, who is also minister for planning and development reforms, and Wang Xiaotao, vice chairman of National Development and Reforms Commission (NDRC) of China.

The official said the $3.5 billion Karachi Circular Railway (KCR) project was also unlikely to be cleared for inclusion in the CPEC at this stage because of some unsettled issues between the two countries. The project is likely to be dropped for now.

Informed sources said the two sides appeared to have settled issues relating to $8.5 billion Karachi-Lahore- Peshawar Railway Line.

The discussions were positive and the two sides are also expected to sign agreements on actively promoted power projects.

They also agreed to include road projects such as the much-talked-about western route between Gwadar, Nawabshah, Zhob-D I Khan-Hakla under CPEC besides Karakoram Highway (KKH) in Gilgit-Baltistan.