By ABDULLAH Pakistan and China have officially launched the second phase of the China-Pakistan Economic Corridor (CPEC 2.0), a move expected to reshape Pakistan’s economic landscape and strengthen one of the most significant bilateral partnerships in Asia. With new agreements worth $8.5 billion signed in Beijing, both nations have reaffirmed their shared commitment to industrial growth, technology, and regional connectivity.
Prime Minister Shehbaz Sharif, speaking at the Pakistan-China Business-to-Business (B2B) Investment Conference, described the launch as a “long march of economic growth”, stressing that CPEC’s second phase would generate jobs, attract foreign investment, and modernize key sectors including agriculture, IT, artificial intelligence, minerals, renewable energy, and industrial relocation.
Launched in 2015 under China’s Belt and Road Initiative (BRI), the first phase of CPEC focused on energy and infrastructure projects, helping Pakistan overcome crippling power shortages. According to government figures, daily power outages exceeding 15 hours were cut drastically due to new power plants financed under CPEC.
Now, CPEC 2.0 marks a strategic shift from government-to-government projects to business-to-business cooperation. This phase emphasizes Special Economic Zones (SEZs), where Chinese and Pakistani companies will jointly invest in manufacturing, exports, and industrial development.
Prime Minister Shehbaz Sharif highlighted agriculture as a top priority:
“Our agriculture sector employs 60% of our population. China has excelled in modern farming, and we seek your partnership to upgrade our practices, boost exports, and ensure food security.”
At the Second Pakistan-China B2B Investment Conference, 21 Memorandums of Understanding (MoUs) were signed, covering:
- $7 billion MoUs between private enterprises.
- $1.54 billion in joint ventures, spanning agriculture, electric vehicles, solar energy, petrochemicals, steel, and IT.
Deputy Prime Minister Ishaq Dar, senior ministers, and business leaders from both sides attended the event, where over 800 companies participated.
The agreements also set the stage for early implementation of Main Line-1 (ML-1) Railway Project, the Karakoram Highway realignment, and further development of Gwadar Port, strengthening Pakistan’s role as a trade hub.
CPEC’s first decade laid the foundation for connectivity and energy security. Now, the second phase is expected to address Pakistan’s chronic economic challenges by:
- Boosting Exports – Joint ventures in textiles, minerals, and technology will target regional and global markets.
- Job Creation – With industries relocating from China to Pakistan’s SEZs, thousands of skilled and semi-skilled jobs are expected.
- Agricultural Modernization – Introduction of smart farming, irrigation technology, and food processing industries.
- Energy Diversification – Investments in solar and renewable energy to reduce reliance on imported fuel.
- Digital Growth – Focus on IT and AI aligns with Pakistan’s youth-driven tech economy.
Economists point out that if effectively implemented, CPEC 2.0 could add 2–3% to Pakistan’s annual GDP growth.
A recurring concern for Chinese companies investing in Pakistan has been security threats to Chinese nationals. Addressing this, PM Shehbaz made a clear assurance:
“The safety of our Chinese brothers and sisters in Pakistan is paramount. We will not tolerate a second’s delay in ensuring their protection.”
He emphasized that Chinese investors would be treated as partners, not outsiders, declaring that “Pakistan is your second home, just as China is ours.”
The Beijing summit was not just about trade. PM Shehbaz and Chinese Premier Li Qiang reaffirmed their countries’ “iron-clad, all-weather strategic partnership.”
The two leaders discussed:
- Strengthening defense and diplomatic cooperation.
- Expanding collaboration in science, education, and media.
- Rolling out the Joint Action Plan 2024–2029 for sustained partnership.
With Pakistan and China set to celebrate 75 years of diplomatic ties in 2026, the partnership continues to be described in symbolic terms – “higher than the Himalayas, deeper than the oceans, sweeter than honey, and stronger than steel.”
- Pakistani Business Leaders see CPEC 2.0 as a chance to integrate with global supply chains. Many are urging the government to streamline customs, reduce bureaucratic red tape, and fast-track SEZ development.
- Chinese Investors are optimistic but cautious. “We are interested in Pakistan’s minerals and agriculture, but safety and policy consistency are key,” said a representative at the Beijing conference.
- Public Sentiment in Pakistan is mixed. On social media, hashtags like #CPEC2.0 and #PakChinaPartnership trended, with supporters calling it a “game-changer,” while skeptics worried about Pakistan’s growing debt and overdependence on China.
While CPEC 2.0 holds promise, experts warn that Pakistan must tackle several issues:
- Debt Management – Ensuring new projects don’t worsen Pakistan’s external debt burden.
- Governance & Red Tape – Eliminating bureaucratic delays in SEZs.
- Local Participation – Guaranteeing that Pakistani industries and workers benefit alongside Chinese firms.
- Environmental Concerns – Balancing industrial growth with climate commitments.
If these challenges are not addressed, Pakistan risks missing out on the full potential of CPEC’s second phase.
- Total Investment Announced: $8.5 Billion
- Sectors Covered: Agriculture, IT, AI, minerals, renewable energy, industrial relocation
- Priority Projects: ML-1 railway, Karakoram Highway, Gwadar Port expansion
- MoUs Signed: 21
- Expected Benefits: Job creation, export boost, digital growth, agricultural modernization
CPEC 2.0 is more than a set of agreements; it’s a strategic roadmap for Pakistan’s economic revival. With China’s support, Pakistan has the chance to modernize its industries, secure energy independence, and emerge as a key regional trade hub.
However, success will depend on execution, transparency, and inclusivity. If managed well, CPEC 2.0 could transform Pakistan’s economy, just as the first phase helped end its energy crisis.
As PM Shehbaz Sharif summed up in Beijing:
“We know the path is difficult, but not impossible. With China’s support and our commitment, we will make Pakistan a strong and vibrant economy. Let today mark the beginning of that journey.”