Will Pakistan's financial crises lead to an untimely demise of CPEC?

A number of road projects related to the $52 billion China-Pakistan Economic Corridor (CPEC) are said to be in the doldrums as Pakistan's National Highway Authority (NHA) faces a financial crisis, the media reported on Monday.

Dawn online cited sources as saying that contractors stopped work on several CPEC projects after their cheques worth over Rs 5 billion bounced a couple of days ago.

The affected projects include Hakla-Dera Ismail Khan, Western Route of CPEC and all sections of the Karachi-Lahore Motorway.

According to the report, not only the CPEC projects but local industries related to construction and a large workforce of engineers and labourers were also hit by the situation.

When contacted, NHA spokesman Kashif Zaman said the authority issued cheques of Rs 5 billion on June 29 to the firms against the sanction by the government.

He said cheques worth Rs 1.5 billion were cleared on the same day and "the remaining cheques that were deposited the next day could not be cleared".

Zaman said the matter had been taken up with the government and would be resolved soon. Asked about suspension of work by the contractors, he said that the progress on the projects "had not been affected" and most of the projects in question would be completed by December.

The CPEC will connect China's Xinjiang region with Pakistan's Gwadar port giving it access to the Arabian Sea.

While India opposes CPEC's route as it cuts through the disputed part of Kashmir held by Islamabad, experts feel Pakistan is already facing a massive debt burden because of the project.