Indian lobby at World Bank frustrates Pakistan

ISLAMABAD: Pakistan and the World Bank have failed to reach an agreement on a way forward to address the former’s concerns over violation of the Indus Waters Treaty by India, as a strong Indian lobby in Washington again frustrated the latest push to stop New Delhi from violating the treaty.

“An agreement on the way forward was not reached at the conclusion of the meetings” between the Pakistani delegation and the World Bank officials, announced the Washington-based lender on Wednesday.

It added that several procedural options for resolving the disagreement over the interpretation of the Indus Basin Treaty’s provisions were discussed by both the parties.

Pakistan to discuss India’s violation of Indus Water Treaty with WB president

“While an agreement on the way forward was not reached at the conclusion of the meetings, the World Bank will continue to work with both the countries to resolve the issues in an amicable manner and in line with the treaty provisions,” stated the World Bank.

But a Pakistani official who attended the meetings claimed that the World Bank has assured to bring resolution to the longstanding dispute. He added that Pakistan lodged the protest in the strongest possible words.

Senior World Bank officials met on May 21-22 with a delegation from the government of Pakistan at their request to discuss the issues regarding the Indus Waters Treaty and opportunities within the treaty to seek an amicable resolution.

Pakistani delegation, led by Attorney General of Pakistan Ashtar Ausaf Ali, met with Kristalina Georgieva, World Bank Chief Executive Officer, and the regional management for South Asia.

The delegation of the Government of Pakistan also shared with the bank their concerns about the recent inauguration of the Kishanganga hydroelectric plant.

The Pakistani delegation had rushed to Washington after Indian Prime Minister Narendra Modi inaugurated the 330-megawatt Kishanganga hydroelectric power plant in Indian Occupied Kashmir (IoK).

The Kishanganga project has the potential to disrupt flows, which will also adversely affect the recently constructed 969MW Neelum-Jhelum hydropower project.

Pakistan has maintained that the dam violates the World Bank-mediated treaty on the sharing of the Indus River and its tributaries upon which 80% of its irrigated agriculture depends.

The disagreement serves a serious blow to Pakistan that remains unable to penetrate in the World Bank, which is under heavy influence of the Indian lobby working in Washington. The South Asian department of the World Bank is also under the influence of the Indian lobby.

Over the years, successive governments kept a blind eye over a growing Indian influence in international financial institutions. The governments have been sending retired and serving bureaucrats from the Pakistan Administrative Service (PAS) Group to fill technical posts in these important global bodies, which affected the country’s position.

A retired PAS officer is currently executive director in the Asian Development Bank in Manila. A former National Highway Authority chairman is now Pakistan’s executive director in the World Bank.

The post of senior adviser to the IMF executive director is vacant for last over one year due to tussle over appointment of a blue-eyed PAS officer in Washington.

To the disappointment of Islamabad, the World Bank also stated that “as a signatory to the Treaty, the World Bank’s role is limited and procedural”.

In particular, the role in relation to ‘differences’ and ‘disputes’ is limited to the designation of people to fulfill certain roles when requested by either or both parties, it added.

ECNEC approves Neelum-Jhelum project at Rs507b cost

The World Bank underlined that the Indus Waters Treaty was a profoundly important international agreement that provided an essential cooperative framework for India and Pakistan to address current and future challenges of effective water management to meet human needs and achieve development goals.

“The World Bank remains committed to act in good faith and with complete impartiality and transparency in fulfilling its responsibilities under the Treaty, while continuing to assist the countries,” according to the handout.

In 2016, Pakistan had filed a complaint with World Bank, saying India had contravened the Washington-based lender-mandated pause placed in 2016 by completion of the Kishanganga Dam.

The Hague-based International Court of Arbitration had ruled in favour of India and allowed New Delhi in 2013 to go ahead with the construction of the Kishanganga hydro power project.

The Kishanganga project was started in 2007 but on May 17, 2010, Pakistan moved for international arbitration against India under the provisions of the Indus Waters Treaty.


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PSO and Power China Plan to Set Up Oil Refinery Worth $8 Billion in Pakistan

Pakistan State Oil (PSO) is in talks with Power China for a partnership in an estimated $8 billion refining project in the country according to informed sources.

An agreement between the two is expected to be signed ‘very soon’, said an official. However, he had no firm details on the particulars of the agreement as reported by an English Newspaper.

It should be noted that during his recent visit to China, Prime Minister Shahid Khaqqan Abbasi witnessed the signing of memorandum of understanding (MoU) between PSO and Power China for the construction of up-country deep conversion oil refinery and laying of crude oil pipeline during a visit at the Boao Forum recently.

The refinery would likely have a capacity of 250,000 barrels/day (bpd) to 300,000 bpd/day.

Moreover, the pipeline has been designed to avoid any accidents and maintain smooth supply to other installed refineries.

Officials said the projects aim to supply uninterrupted crude oil and finished products in Punjab, Khyber Pakhtunkhwa and other parts of the country.

Currently, the country has five refineries having a combined capacity of around 404,000 barrels per day.

It is yet to see when the project would materialize as the new refinery should be based on the latest technologies.

At the moment, Pakistani refineries are producing around 25 percent to 40 percent of furnace oil from their product mix. These refineries had to suffer a colossal loss, following the government’s decision to close down power plants running on furnace oil back in November 2017.

Pakistan has already reduced its reliance on furnace oil. It has invested huge amounts in alternate and cheap sources of power generation, as well as in coal and LNG-based power plants.


SBP Allows Bank of China to Open Yuan Accounts of Local Banks

State Bank of Pakistan (SBP) has inked a Currency Swap Agreement (CSA) with People’s Bank of China (BOC). The objective of the agreement is to promote bilateral trade and financing direct investment between China and Pakistan in the respective local currencies.

This was informed by spokesperson State Bank of Pakistan SBP while talking to ProPakistani today. State Bank of Pakistan (SBP) has continuously been taking policy measures to ensure that imports, exports and financing transactions with China can be denominated in Chinese Yuan (CNY).

This is SBP’s second agreement with a Chinese bank to facilitate local currency cross-border trade. SBP already allows Industrial and Commercial Bank of China Limited (ICBC) Pakistan to offer similar services since 2015.

Under the agreement, Bank Of China BOC Pakistan will establish a local CNY settlement and clearing setup in Pakistan. Bank Of China BOC can open Yuan (CNY) accounts of the banks operating in Pakistan, to facilitate settlement of Yuan based transactions such as remittance to/from China. Bank Of China BOC can also provide Yuan liquidity to the interbank market for the settlement of Yuan based transactions.

“These steps are part of the efforts by State Bank of Pakistan SBP to encourage trade with China in Yuan and eventually in the respective local currencies. This settlement and clearing mechanism is expected to reduce costs and increase efficiency for the local banking system in transacting in Yuans,” the spokesperson said.

The spokesperson further said that currency swaps will enhance market liquidity and facilitate settlement of growing trade and investment transactions between China and Pakistan in Chinese Yuan.



Pakistani policymakers recommend better management of CPEC

A group of policymakers on Tuesday recommended Pakistan to establish a specific China-Pakistan Economic Corridor”China-Pakistan Economic Corridor (CPEC) unit within the framework of Council of Common Interests (CCI), in order to achieve “transparency and efficiency” in the project.

On the launch of 10th Annual Report titled ‘The State of the Economy: CPEC Review and Analysis’, Shahid Javed Burki of the Institute of Public Policy opined that the Chinese-funded project had not yet been fully “defined and developed”.

“To realise its full potential, the CPEC program must have the support of all the citizens,” he said.

The CCI is a constitutional body in Pakistan, which resolves the disputes of power-sharing between the country and its provinces. The body is chaired by the Prime Minister of Pakistan.

According to the report, it stated that proper planning of the four proposed functional zones was essentially imperative for harnessing the comparative and competitive advantage of each zone based on agro and other value chains, The Express Tribune reported.

Burki claimed that the CPEC project was expected to add 2 percent growth to Pakistan’s gross domestic product (GDP) and greater integration of the country’s backward areas with the developed areas.

Stressing on the benefit of the economic corridor, Burki added, “CPEC will also link Pakistan with the global economic system from which it has remained relatively detached.”

Former State Bank of Pakistan governor Ishrat Husain who also attended the event, touted the CPEC project to help in boosting technology and human development in Pakistan.

The building of the USD 62 billion economic corridor gives China access to waterways which is about 40 percent of the world’s oil passes. When built, it will link Gwadar to Xinjiang region in China.

In response to it, a certain section of people, especially the Baloch people have harboured fears of Pakistan being colonised by the Chinese.

India against the CPEC project since it passes through the disputed Pakistan-occupied Kashmir (PoK) region. (ANI)