Pakistan and the Global Development Opportunity

For Pakistan, development can be said to be more than just seeking financial assistance or construction of infrastructure projects. The bigger task for the country is to build an economically productive system which is able to provide employment, increase exports, attract investments and improve the quality of life of its increasing number of people. In this context, the reiteration by the Prime Minister of Pakistan, Mr. Shehbaz Sharif regarding Pakistan’s support for China’s Global Development Initiative (GDI) becomes important in terms of economics and not just diplomacy.

Addressing a meeting of GDI held under the auspices of Chinese Vice President, Mr. Han Zheng in New York, the Prime Minister has referred to the widening gap in financing the Sustainable Development Goals (SDGs), climate-related disasters, increasing cost of food and fuel and geopolitical tensions for developing countries.

The importance of the GDI for Pakistan is that it closely aligns with the needs of Pakistan’s own economic development. Poverty alleviation, food security, industrialization, digital economy, climate change mitigation, and connectivity are not some distant foreign policy aims of Pakistan. They are part and parcel of Pakistan’s efforts to build its economy and make it more resilient. And the true benefit is in converting international collaboration into productive capacity building within Pakistan.

Here comes the significance of the developing Pakistan-China economic relationship. Islamabad and Beijing have already reached an understanding to go forward with a renewed CPEC 2.0, placing more focus on industries, agriculture, and mineral exploration. The two sides have also decided to collaborate further in digital economy, artificial intelligence, science & technology, financial sector, trade, and training programs. Gwadar Port and Khunjerab Pass have been identified as connectivity projects with Pakistan and China, and industrial parks and mineral cooperation are getting more focus.

This trend of industrialization is especially significant. Infrastructure can provide the base for any economic activity; however, long-term growth would not be possible without industries making competitive products and services. Thus, Pakistan should develop a path not only based on connectivity but also on the connection between infrastructure and manufacturing, technology, value addition, and exports. The participation of China in such an initiative through investment and industrial cooperation could help with this task.

Another promising sphere of convergence is agriculture. It is clear that Pakistan has great agricultural potential; however, in order to increase its productivity, there is a need to use new technologies, improved water management, more mechanization, research, and access to international markets. In this regard, it is useful to note that there has been expansion in cooperation between China and Pakistan in the sphere of agricultural technology and education, including training of 1,000 young agricultural technicians from Pakistan in China.

It also has potential importance to Pakistan’s future economic growth. Having a youthful and growing technology base, there is opportunity for Pakistan to participate in global digital economy markets through cooperation in information technology, artificial intelligence, telecommunication, scientific research and technical education. As such, the focus of GDI on digital economy offers a valuable international approach to an increasingly important area in Pakistan’s economic development process.

There is also a strategic dimension involved in Pakistan’s support for the initiative. Pakistan was among the earliest supporters of the GDI’s Group of Friends and has in the past been considered as a priority partner by China under the initiative. This demonstrates consistency in policy and not an adventurism in foreign policy. It also aligns with Pakistan’s policy of enhanced cooperation between developing countries and multilateral approach to development.

Nevertheless, the success of this cooperation will depend on the implementation of such programs in Pakistan. International programs can provide an opportunity, but the institutions, business environment, skill set, policies and project implementation at the country level will determine how well that opportunity converts into economic gains for the country. Thus, what Pakistan needs to do is to link the GDI and CPEC program with its national priorities which include increased exports, industrial productivity, advancement in technology, agricultural development and employment creation.

In this way, the endorsement of the GDI by Pakistan is simply an expansion of its development partnership with China. On one hand, CPEC is already providing a platform for connectivity and investments. On the other hand, the GDI provides a much larger development framework in terms of human development, industrialization, technology, food security and sustainability. The overlap between the two would help Pakistan have more avenues of development.

For Pakistan, the core challenge lies in translating connectivity into commerce, investments into production, technologies into skills and development cooperation into economic opportunities. If well done, the GDI can serve as a catalyst to help complement Pakistan’s own efforts towards economic transformation and its growing role in South-South Cooperation. What will ultimately matter about the project will not be statements made, but the number of factories built, exports made, skills acquired and economic opportunities created for the people of Pakistan.