China to inject $62 bn in policy banks to boost ‘New Silk Road’ - report

COMMENTS (84) Your comment is awaiting moderation. inject $62 bn in policy banks to boost ‘New Silk Road’ - report Published time: April 20, 2015 22:08 Edited time: April 21, 2015 07:57 Get short URL Reuters/Petar Kujundzic Reuters/Petar Kujundzic 349213 Tags Banking, China, Investment China will reportedly allocate $62 billion of its foreign exchange reserves to three state-owned “policy banks” in order to support its New Silk Road project aimed at creating infrastructure links with foreign markets. The project called "One belt, One road", also known as the New Silk Road, includes plans to build roads, ports, railway systems and other infrastructure from China into the Middle East, Central, South and Southeast Asia to create demand for China’s industrial exports, as it already sees oversupply at home. The People’s Bank of China will direct $32 billion to China Development Bank (CDB) and $30 billion to Export-Import Bank of China (EXIM), the Caixin magazine said in a report on its website. The third bank to receive cash from China's central bank is Agricultural Development Bank of China (ADBC); another state-owned bank that supports the farming sector. Read more China to invest $46bn in economic corridor with Pakistan - media The capital injection will be carried out through converting entrusted loans into stakes, the journal said, adding that the People's Bank of China will become the second largest shareholder in the China Development Bank and the biggest shareholder of the EXIM bank. Chinese government said last week it had approved the reform plans for CDB, Exim Bank and Agricultural Development Bank proposed by the Central Bank in attempts to advance finance projects amid the current economic slowdown. The government has been saying for years it intended to transform these three policy banks into commercial institutions, but little progress has been seen. Policy banks in China do not accept deposits and fund themselves mainly by selling bonds carrying an explicit government guarantee. The banks sell bonds in Yuan within China and USD bonds in the offshore market. The foreign exchange reserves of China, considered the worlds largest, fell by $110 billion to $3.7 trillion in the first quarter of 2015. China had previously used part of its foreign currency reserves to recapitalize major state-run banks, help them restructure and list their shares. 759 characters COMMENTS POLICY BESTNEWESTOLDEST M.M.SHERAZIabout 22 hours ago Long Live Pakistan, Love Live China, the Friendship of all weathers... RECOMMEND112 STRINGabout 22 hours ago China has no plan yet to develop her south and western part , even though they have plan but it will take them 100 years , All the universities and industry exit in Eastern china with port cities,.. For China Eastern and western part has as contrast as Pak has Lahore and DI Khan . Even China are facing extremism and terrorism in south western cities .. Pak has to made on companies to build coal based power plant , Chines can not afford to work with exiting force in Pak. RECOMMEND23 HUZAIFAHabout 22 hours ago Big Opportunity for Pakistan. RECOMMEND67 KAMAL PASHA.about 22 hours ago China is the most trusted friend since day one. Pakistan should always receiprocate their help. RECOMMEND55 HARMONYabout 22 hours ago "India is concerned about China’s growing investment in Pakistan". Why? Prosperity and peace for any country in the region is good for others in the region and rubs along! RECOMMEND96 KAMAL PASHA.about 22 hours ago China has always been good friend from the day one. Pakistan must receiprocate all their help. There is too much for both in maintaining their good friendship. RECOMMEND27 KAMAL PASHA.about 22 hours ago Both countries have spent long time about this Gwadar project. They will fortified this area in suchna way that nothing will go wrong and not even bird will fly over these areas. It will be good for insurgents to keep themselves away from these areas. It is upto them. RECOMMEND27 TARIQ, LAHOREabout 22 hours ago Pakistan India are natural partners but the their BIG mistake is their failure to resolve the Kashmir issue - this has, is and will cost much more in the future if this issue is not addressed!! RECOMMEND53 ASHEIKHabout 22 hours ago No amount of additional energy is enough, if power theft cannot be controlled. We are our own worst enemies. RECOMMEND36 GAURAV ARYAabout 22 hours ago @Harmony - We are not concerned. Just don't mess it up like everything else. Rest if fine. Its your sovereign matter. We are no one to have an opinion. Its between China and Pakistan. RECOMMEND85 AHMEDabout 22 hours ago very informative article!!! whether one likes it or not credit for this investment goes to PMNS!! RECOMMEND22 SAEED MASOODabout 22 hours ago These projects put together are enormous by any standard...the government must announce very clearly how it will be done honestly and successfully on time.Only signing is not enough do the Pakistan side have the capability to fulfill. RECOMMEND13 IRFAN FAROOQUIabout 22 hours ago amazing what a brilliant and well made project..... RECOMMEND20 HARMONYabout 22 hours ago @ahmed - But he prefers building roads and metros more! RECOMMEND7 EHSAN KARIMabout 21 hours ago Most of the money for the purchase (Gwadar) from Oman came from donations, with Prince Ali Salman Mohammad Shah Aga Khan, being the greatest contributor, while the remainder was raised by taxation. RECOMMEND17 MUHAMMADabout 21 hours ago Its a win win for all, China is going to reap the benefits of friendship with Pakistan. India should also work along same lines, forgetting the past, for returning prosperity to the sub-continent. RECOMMEND33 JAINYabout 21 hours ago This will soon be turned as Kalabagh Dam due to route change. Such projects will definitely change people's mind and thinking. Route must not be changed if you want to see progressing Pakistan. ANP and other such parties are already declaring this to be another Kalabagh Dam. Please stick to the original route and make Pakistan Progress. Development leads you to Peace. RECOMMEND12 HANIabout 21 hours ago @Kamal Pasha. Pakistan always does RECOMMEND0 ABC@ABC.COMabout 21 hours ago @Jainy - First make sum thing happen and once single route is up, other (original route) will be peanuts. As fruit from the wave of progress from first route will be tremondous. RECOMMEND5 AAM ADMI about 21 hours ago “China is not building the corridor as an act of charity for Pakistan,” RECOMMEND35 MUHAMMAD FAROOQabout 21 hours ago Huge Chines investment to the tune of billions of dollars in the infrastructure and energy related projects will serve as a catalyst for the economic and social development of the country. The real benefits of this progress will go to common people is a question mark because for that we need a fair and equitable corruption free taxation system and honest implementation of projects for the welfare of the people. RECOMMEND15 ONEEBabout 20 hours ago International energy war between US, Israel, India etc. against Arabs, Chinese etc. is slightly exposed in this article. RECOMMEND9 GURUabout 20 hours ago such a good idea to have the good relation with your neighbor. Be friendly to the one who is friendly to you and then you can do much more with the friendship than just hello and goodbye. You can build many things and be the one who is going to supply the power to the places that need the supply for the long time and place. When you do this it will be a good idea to make the long investment in the good place that will give you the return for the good will of the other place that is the more money and more better life for the common people of the region which is helpful in making the place a better world for the fifty five cents that you will get for your opinion. RECOMMEND5 EUROabout 20 hours ago India can not tap into Central Asia without Pakistan allowing it to. The same goes for land rutes to Afghanistan. For now India can only continue to fund and train terrorists from Afghanistan and send them into Pakistan - as long as it last - as Pakistan is winning this war under General Raheel. RECOMMEND41 EUROabout 20 hours ago Indians should learn from Pakistan-China friendship and quit Kashmir occupation and return Kashmir to Pakistan, her mother country since partition of 1947, and establish friendship with us. After wll, we have more in common with each other then any other nation on this planet. RECOMMEND26 MALIKabout 20 hours ago @Gaurav Arya I hope others think the same way. RECOMMEND9 MGabout 20 hours ago 8000 security persons to protect 8100 workers!!!! Insane. China must be either trying to establish a military base or feeling insecure to core. RECOMMEND18 MALIKabout 20 hours ago China has been a great friend of Pakistan. These are Great projects which will benefit both countries. Some countries will definitely try to disrupt the arrangements. Indian involvement in the insurgency in Baluchistan will be a huge factor in the success of the Projects. Changing the Route will be another sore spot. Like it or not as long as the corrupt Pakistani government stays in power huge portion of this investment will go into their satanic deep pockets. In short, The new Silk Route must be built but it might not be “Silky” and smooth. RECOMMEND7 RAOabout 20 hours ago No matter what, N.Shariff deserves all the praise for bringing China as a great power bearing gifts, help and sincere friendship is not an easy joke but a Herculean task. This might turn out to be a cornerstone in Pak history to emerge as an Asian tiger. For, Pakistan has the people power, nuke power etc along with growing infrastructure in everything. So the prime minister has turned to be a great statesman as long as his political opponents torpedo it. RECOMMEND7 SANDHUabout 19 hours ago Game changer investment for Pakistan. RECOMMEND13 SHAZIA about 19 hours ago after listening to Pakistani s on TV and reading comments on net, i am of firm belief that every third person in Pakistan is a strategic expert . even when economy is in shambles and jobs are nowhere , people are not talking how the job will be created and has Pakistan got enough talent or potential to absorb so called investment, but are happy to see china as counter weight to Americans. All so called money is not investment ONLY but majority is loan, If Chinese get their own manpower , experts and sub let requirements to own industry, it will not be so sweet senario as it is being painted RECOMMEND43 ARYASTANabout 19 hours ago @Euro India totally isolated. RECOMMEND10 ARYASTANabout 19 hours ago @Euro China wont agree. RECOMMEND2 Zabout 19 hours ago @Gaurav Arya I wish all Indians (and Pakistanis) think like that. Thank you. RECOMMEND9 SHUJAAT KHANabout 19 hours ago Hope they have taken into consideration how many tankers will be torched on land route . RECOMMEND6 Zabout 19 hours ago @Jainy Origianl route(s) not going away, only in the interim utilize existing infrastructure and safer areas. So trade activity starts sooner. RECOMMEND4 VICKYabout 19 hours ago I am afraid of a serious reaction from UAE/GCC for 2 reasons; Pak didn't send troops to KSA & 2ndly this Chinese Corridor will hurt the ongoing trade through Dubai & Oman. Gawadar is in actual deep sea while Dubai has just a bay. RECOMMEND10 LAFANGAabout 18 hours ago "China’s new silk road: What’s in it for Pakistan?" Opportunity ... that is if the clueless leadership can see it. They ONLY like to remind people of the FOREX in Pakistan which is ballooned to $18 bn on the back of soft and hard loans. Hardly any achievement. If the leadership doesn't look at short term gains, there is plenty of opportunity in this deal. Chinese don't want to hand out freebies. They would like to make money and also help Pakistan to make money as well i.e. if Pakistanis are willing to. RECOMMEND10 PRASADDECCANIabout 18 hours ago @Harmony That statement spices up the story; otherwise it reads very bland. RECOMMEND2 TURTH SEEKERabout 18 hours ago Not a fan of NS or PML-N but JOB Well done! RECOMMEND6 PRASADDECCANIabout 18 hours ago @SHAZIA China is investing in and/or extending loans to power projects in Pakistan. Importance of a power project is actually not with the project proper, but, with the potential it generates to set up downstream industries. So, one must accept that China is definitely helping you, and, it is up to you how your private & public sectors take advantage of the available power and invest further which in turn spurs job market. RECOMMEND5 LAFANGAabout 18 hours ago @Vicky "I am afraid of a serious reaction from UAE/GCC for 2 reasons; Pak didn't send troops to KSA & 2ndly this Chinese Corridor will hurt the ongoing trade through Dubai & Oman. Gawadar is in actual deep sea while Dubai has just a bay." Well they can hurt as much as they want. It's called competition and Pakistan has a bigger gun to defend it's side of the Persian gulf and they know it. They can't push Pakistan too hard or it's bye bye to GCC and hello to Iran. RECOMMEND9 ANSabout 18 hours ago @Euro Heard of Chahbahar Port by India in Iran? Alternate route to Afghanistan and competitor to Gwadar coming up there. RECOMMEND9 NASIR NADEEM about 18 hours ago great initiative.credit goes to NS and Mr She.This project must rollout on war footing and should be completed within 3-4 years .It will be a game changer for both countries. RECOMMEND7 TOMabout 17 hours ago @Harmony, Absolutely agree. Indians wish all the very best to Pakistan in building its economy. RECOMMEND5 KAZIM REZAabout 17 hours ago The strategic importance has mentioned by Zofeen T Ebrahim's brief analysis that "the port could turn into China’s naval base in the Indian Ocean, enabling Beijing to monitor Indian and American naval activities."If US had any plan to encircle China with the various Asian powers through land or maritime borders that is not workable at least in Tibet-Kashmir sides due to port Gwadar- Kashgar economic corridor. It's interesting.So chances of any future war by Asian nations have further lessened.A symmetry is being established against India- US axis and more economic competition more non lethal competition among the great nations. Thanks Dawn for focusing such a positive news item. RECOMMEND1 NASIR NADEEM about 17 hours ago @SHAZIA do;nt live in fool,s paradise.even a blind can see the opportunities due to this land mark project. how come there will be no job opportunity even chines bring their own people.Still opportunities will be there.construction;Transport;shipping;and general industry will be a big business during and in post build scenario. long live Pakistan. RECOMMEND1 PROUSTabout 17 hours ago Guide us through our troubled times, our trusted friend. Thank you. RECOMMEND8 THINKERabout 17 hours ago No friend is indeed friendship without personnel interest, told by world ever political science teacher chanakya' ,5000BC RECOMMEND10 ASHOK KUMAR LALabout 17 hours ago But why Gilgit Baltistan and north Pakistan is being placed under China administrative control RECOMMEND0 ZAHIDabout 17 hours ago The question is what is in it for the regions except Upper Punjab? RECOMMEND0 ONE TRICK PONYabout 17 hours ago This investment will be a game changer for Pakistan growth. I can see why India and U.S are worried. This shows you who really is our friend and enemy. RECOMMEND7 ZUBAIRabout 16 hours ago So,this is the startup of development from Urumqi to Gwadar .It will probably coverup the physical link of Allama Iqbal's Nile ke sahil se ta ba khak e Kashgar. RECOMMEND1 MUZAFFAR ALIabout 16 hours ago Friends can do only so much....Pakistan needs to put its own house in order now. RECOMMEND1 SIDDHARTH SAMAIYAabout 16 hours ago China is giving soft loan to Pakistan to fulfill its own purpose.. How ? 1.Pakistan will pay interest on debt to China . 2.Through Gwadar they could save more than $300 billion annually. 3.Will Expand the trade activities with Central Asia , Africa n Middle East. 4.Will use Gwadar as a military base against their rivals . 5.Through pakistan they could increase the flow of goods and capital . What will Pak get ?? Electricity - Which pak would have increase with its own resources ... 2.Employment !! - I don't think bcoz gwadar is now a part of china for at least 40 yrs. Yes Pakistani would work as a lobourer in their aka's region 3.Reduction in funds from West plus bitter relations with India .. China is clever .. It won't give you anything for free ... RECOMMEND3 ZACK KHANabout 15 hours ago Pakistan should ask China to stop persecuting Muslims in China! If you don't stand for something, you will fall for everything! RECOMMEND10 ZACK KHANabout 15 hours ago @ahmed WAKE UP...!! RECOMMEND1 CYRUSabout 15 hours ago Gwadar port to Islamabad. That's where the money is. So much is stolen from the docks in Karachi that Pakistan AND China needed a secure seaport. We could call it the Silk Road because silk dresses and dress creations will exported by China, and so much more. That may include military weapons and vehicles if they are in the budget. RECOMMEND1 MR.GOOabout 15 hours ago If honest work kicks off to materialize this imvestment, will the scope of Civil Engineers increase in Pakistan ? Tell me ..tell me !! RECOMMEND3 ZACK KHANabout 15 hours ago @ahmed nawaz is clueless as to the severity of this project and has failed to reap benefits for Pakistan to the extent he should have! This is true as a nation we have no idea what in it for us! RECOMMEND0 AWabout 15 hours ago If Pakistan can get rid of religious influence on Politics and governance, then Pakistan can be successful as a member of the world community and for maximizing socio-economic development of its own people. Let Pakistan be Pakistan as envisioned by Jinnah and not a religious republic PLEASE for the sake of the Country RECOMMEND9 CYRUSabout 14 hours ago @Kamal Pasha. Absolutely true. RECOMMEND3 USMANabout 14 hours ago @Euro Err, Kashmir's are not interested in going back to Pakistan or India, actually they are demanding the end of occupation from all three: Pakistan, India and China. RECOMMEND0 CYRUSabout 14 hours ago @asheikh No doubt about that. India has the same problem, and in Northwest India the problem is even worse than in Pakistan. If you can believe it. In India no electricity means no electricity, but it also means no fresh water. In city neighborhoods electric pumps are all that draw water. RECOMMEND1 CYRUSabout 14 hours ago @Saeed Masood The PPP could not even get the deal signed. China does not like their money going into political pockets. The PPP and MQM wanted to maintain Karachi port's dominance, but could not stop the smuggling, the theft of goods and the pilferage of shipping containers. Or were afraid to. RECOMMEND0 CYRUSabout 14 hours ago @Jainy Without dams Pakistan will eventually be washed into the Arabian Sea. RECOMMEND0 HARMONYabout 14 hours ago @AW - I agree religion should be no business of state and your advice for Pakistan but at the same time it would have been fair on you to point out India seems to be regressing by promoting Hindutava. RECOMMEND1 CYRUSabout 14 hours ago @Oneeb You mean Pakistani paranoia has been only slightly exposed. You have enlightened us on the matter. RECOMMEND0 SIDNEYabout 14 hours ago The only thing that matters, irrespective of whether US and India are worried, is for China to help Pakistan develop and this will be good for the whole region. Afterall, stability for the region requires all countries do grow and the US does not live in the region. India should support such initiatives RECOMMEND7 NEPTUNE SRIMALabout 13 hours ago looking at it from another angle: China is building a road across Pakistan and building a port mostly for it's own use without having to pay any access charge and with money lent to Pakistan by China which Pakistan will eventually have to pay back. The projects will provide jobs for thousands of Chinese workers in Pakistan who will be protected by a special division of Pakistani security force raised and maintained with Pakistani money. China will also be constructing coal burning power plants -- the age of which is now past -- most likely such power plants will have to buy carbon credits in future from the global exchanges making them uneconomical. I fervently hope that this deal is a game changer for Pakistan, will bring economic prosperity to Pakistan and will provide jobs to unemployed Pakistani youth who will then move away from extremist philosophies. But seriously, I see a lot of benefits to China -- looks like Pakistan has been badly conned. RECOMMEND2 MANZOORabout 12 hours ago No mention of Nawaz Sharief, the main architect of this plan in the whole article. Says something about the policy of Dawn RECOMMEND1 JAVIDabout 12 hours ago Thanks to Musharaf. He started Gawader port. RECOMMEND1 PAVANabout 12 hours ago How many Pakistanis are going to get jobs. The only country which benefits is China. China has gone and made friendships with the countries which are strategically beneficial for them. They are not doing a charity here. Its heartening to know that Pakistan is getting mobbed by the Chinese. RECOMMEND2 EXCELSIOR LONDONabout 11 hours ago should there be a CIP (China-Iran-Pakistan) gas pipeline? RECOMMEND1 SALMAN AHMED about 10 hours ago @Turth Seeker just wait and see :-) RECOMMEND1 GULabout 9 hours ago Pakistan will benefit from china tremendously..we should support pakistan China cooperation whole heartedly RECOMMEND2 RAMAabout 8 hours ago Beware of China, they are not supporting Pakistan and looking only for their strategic interest, remember what happened to Vietnam after US left . RECOMMEND1 SHAHabout 8 hours ago I have observed that the map above has Bay of Bengal where the Arabian sea should be. RECOMMEND1 AYERabout 7 hours ago Its hard to understand the hyperbole and gushy language from commentators about Pak - China friendship. Everyone knows that it is only National interests that matter. Today Saudi Arabia is very much on the side of Israel over the Iran issue though it may not publicly say so. RECOMMEND1 SHEIKH KHALIDabout 6 hours ago @Rao China just came in to pluck the "ripe apple" at U.S. behest. That was the plan all along behind "War in Afghanistan". it is a case of Good Cop, Bad Cop, and certain Money Lenders. RECOMMEND0 SYED AHMED ABIDabout 6 hours ago History would remember Zulfiqar Ali Bhutto as a great visionary who initiated the Pak China friendship the fruits of which are materialising now. RECOMMEND1 JUS_ANOTHER_GUYabout 6 hours ago @One Trick Pony who told you who is worried? or is it just another pint of pakistani imaginative conspiracy theories, 46 billion is nothing for US or for that matter even India, and its not even Donation , Why would someone invest somewhere, they will earn 460 billion out of 46 billion , mark my words, get ready for deceive again RECOMMEND0 SHEIKH KHALIDabout 6 hours ago Meta courtesy 25° 8'24.39"N, 62°19'45.22"E. Google Earth. The photo at that location. RECOMMEND0 ADHAWKabout 3 hours ago China is a strategic partner linked to Pakistan only in its rivalry with India. There is no cultural affinity or people-to-people links. Want to see real friends, check out U.S./Canada or U.S./U.K.