Cash-strapped Pakistan asks China to shelve US$2 billion coal plant

Pakistan has officially asked China to shelve a joint US$2 billion coal power project from the US$62 billion China-Pakistan Economic Corridor (CPEC) infrastructure project, claiming it will be too expensive and should not be an immediate priority.

The request was made when Makhdoom Khusro Bakhtyar, Pakistan’s minister for planning and development, travelled to Beijing in December for a CPEC coordination meeting, according to a government official not authorised to speak publicly on the matter.

“The government is evaluating some of the Chinese projects, which are more expensive and not necessary at the moment to save public money,” the official said. “We have to focus on our priorities, including the development of Gwadar port and the western route of CPEC, which connects the hinterlands of Baluchistan and Khyber-Pakhtunkhwa provinces.”

The official said government advisers had pointed out there was more power generation capacity coming online from other projects.

Bakhtyar did not respond to inquiries on Tuesday. He first revealed last September the government’s intention to give up on imported coal energy projects, including the Rahim Yar Khan Coal power project in Punjab province. Then, Yao Jing, China’s ambassador to Pakistan, said Beijing was open to changes proposed by the new government and “we will definitely follow their agenda”.

Lijian Zhao, the deputy chief of mission at the Chinese embassy in Islamabad, on Tuesday said the decision to “abandon” the power plant project was made long ago and by the previous government.

Pakistan’s finance minister Asad Umar told reporters: “The CPEC is now moving from an infrastructure and energy phase to trade and industry sectors.”