Pakistani PM Imran Khan to attend groundbreaking ceremony at industrial city
Pakistani Prime Minister Imran Khan will perform an inauguration ceremony today for the Allama Iqbal Industrial City. It will be attended by a group of local and foreign investors.
The city is a prioritised Special Economic Zone (SEZ) and a product of the China-Pakistan Economic Corridor (CPEC). Khan hopes it will boost economic growth and create hundreds of thousands of jobs, key pledges that brought him into power in 2018.
The inauguration of this CPEC project reflects the deepening relationship between Beijing and Islamabad; Pakistan is relying on roughly $62 billion of Chinese investment to overcome economic stagnation. While the SEZ is likely to boost GDP growth, Pakistan already owes over $100 billion to international lenders, and mega-projects risk further undermining Pakistan’s fiscal stability.
In the short term, expect today’s ceremony to increase scrutiny by outside powers, particularly the US, over perceived Chinese debt-trap diplomacy. The success or failure of Pakistan’s newest industrial city will be closely watched by other recipients of Chinese investments, who may seek to renegotiate the scale of loans in order to ensure sustainable development.
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