China will receive 91pc revenues from Gwadar port for 40 years

[monitor]

China will receive 91pc revenues from Gwadar port for 40 years
By News Desk -
November 25, 2017
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ISLAMABAD: China will receive 91 percent of the revenues set to be received from Gwadar Port and 9pc will go to Gwadar Port Authority (GPA) for a period of 40 years, the Senate was informed on Friday.

The details were shared by Federal Minister for Ports and Shipping Mir Hasil Bizenjo with senators after they showed their worries over concealment over China-Pakistan Economic Corridor (CPEC) long-term agreement, reported Dawn.

Bizenjo said the agreement was reached on build-operate and transfer model negotiated for a period of 40 years. PML-N’s Senator Kalsoom Parveen of PML-N said agreement had not been inked on basis of parity as had been done with India, she said.

Parveen asked Chairman Senate Raza Rabbani to call for a meeting in which all related departments which signed the agreement should be present. On this request, Rabbani highlighted about the presence of two committees in relation to CPEC, a parliamentary panel and senate committee.

Rabbani asked Parveen to take up this issue with Senate committee on CPEC. Pakhtunkhwa Milli Awami Party (PkMAP) Senator Sardar Azam Musakhel decried that no chairman of the two committees was from Balochistan and accused that China had been provided a concession.

And Pakistan Tehreek-i-Insaf (PTI) Senator Mohsin Aziz, said the involvement of business community was a must in inking of such business dealings, a task which be believed shouldn’t be left to bureaucrats.

PML-N Senator Javed Abbasi said CPEC would offer immense benefits to Pakistan and defended the agreement. He said power projects under CPEC would resolve Pakistan’s energy crisis and several are being established in Sind and Balochistan.

• TAGS
• CPEC
• Gwadar Port
• power projects
• Senate Panel

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Pretty sweet deal for Chinese,no wonder they are so keen on it
Pakistan only gets 9%.Will the security cost outweigh the 9% revenue?

This is BOT aggrement so not bad actually if someone only read the title. But why they will take 91 % revenue for 40 years. It tells either Pakistan failed to negotiate good term with Chinese or expected revenue will be to small to make operating profit every year.

Secondly @ryzuki pointed out are those 9% revenue sufficient for security expense if we only consider port operation other then different investment expected investment.

 

[DarX]

Do u honestly believe 1 trillion dollars of goods,most of it made in the Far east on Chinese coast,will travel thousands of kilometres(for example,Shenzen to Kashgar is 5,641 km by road),cross into Pakistan through Karakoram pass which is blocked for 6 months in an year,and will further travel 2500 km through Pakistan to reach Gwadar?
For example take the Suez Canal.More goods pass through it than they will from China to Pakistan in decades,and they certainly do not make 90 billion a year.Will Gwadar handle more trade than Suez Canal?

Just ask yourself 1 question-Why is Ahsan Iqbal hiding details of CPEC from public when he said he would share it a few days ago?

Perhaps its not $90 billion. Perhaps it's only $90 million. That's still $90 million more than what Gwadar is generating right now, and the thousands of jobs the people of Balochistan will get is the main benefit. Jobs for the Baloch will bring prosperity to the region and wipe out the last reason for the dwindling insurgency. Win-win for Pakistan at every corner of this project.

 

[Samlee]

Is this real

This Was Actually The Original Concession Agreement Made With PSA Consortium In 1996.Personally Even I Do Not Agree With It.But Chinese Got This When The Concession Was Transferred To Them.This Concession Was Not China Specific.

 

[DarX]

This is BOT aggrement so not bad actually if someone only read the title. But why they will take 91 % revenue for 40 years. It tells either Pakistan failed to negotiate good term with Chinese or expected revenue will be to small to make operating profit every year.

Secondly @ryzuki pointed out are those 9% revenue sufficient for security expense if we only consider port operation other then different investment expected investment.

These projects take years to take off and so the port will probably generate negligible revenue in the first couple of decades. That is why the lease is for 40 years. The security costs are not an issue as our objective is not just the port revenue but it is to start economic activities in the region and we already have to pay for the security even without the CPEC. So it is in our benefit from all angles.

 

[CriticalThought]

For all Indian members. Forget 91% vs 9%. Think what exactly will happen if you or your Uncle Sam try to hit Gawadar or try to blockade it. You will be hitting China directly. I wouldn't be surprised if in the future Chiba starts building islands in the Arabian Sea. @wanglaokan

 

[Mukunda Murthi Rao]

For all Indian members. Forget 91% vs 9%. Think what exactly will happen if you or your Uncle Sam try to hit Gawadar or try to blockade it. You will be hitting China directly. I wouldn't be surprised if in the future Chiba starts building islands in the Arabian Sea. @wanglaokan

So will you sell your country just to spite india and china?

 

[litman]

40 yrs is a lot of time. the map of the world has been changing through out the history. our map changed in 71. the world is on the brink of destruction and the big powers are ready to do something foolish at any moment.

 

[CriticalThought]

So will you sell your country just to spite india and china?

Did China sell Hong Kong? Or did it make a strategic decision for long term gain? These types of decisions require vision and forward thinking.

 

[Clutch]

So will you sell your country just to spite india and china?

Spite China?... no.

Indians are Pakistan's mortal enemy... they are full of hate.... they will exterminate us and push us into the sea if we dont stand up to their terror and warmongering.

 

[Samlee]

Do u honestly believe 1 trillion dollars of goods,most of it made in the Far east on Chinese coast,will travel thousands of kilometres(for example,Shenzen to Kashgar is 5,641 km by road),cross into Pakistan through Karakoram pass which is blocked for 6 months in an year,and will further travel 2500 km through Pakistan to reach Gwadar?
For example take the Suez Canal.More goods pass through it than they will from China to Pakistan in decades,and they certainly do not make 90 billion a year.Will Gwadar handle more trade than Suez Canal?

Just ask yourself 1 question-Why is Ahsan Iqbal hiding details of CPEC from public when he said he would share it a few days ago?

Here Are A Few Points
1.Even If We Consider The Time Sensitive Goods As 1% Of China's Total Exports This Means $30 Billion Dollars That Can Go Through CPEC.FYI China Has Already Built A Link From East Coast Linyi(Eastern China) To Gwadar


http://en.people.cn/n3/2016/0510/c98649-9055546.html


2.Running A Port Is Not Like Building A house or running a shop, it needs a huge investment along with a number Of Liabilities. Hence, If From The Net Income Pakistan Gets Around 10% Without Having Spent A Single Penny, It’s Great Indeed. A Strategic Resource Would Be Developed With Someone Else’s Money But Will Ultimately Remain Pakistan’s Hands

3.Has It Occured To You That With The Passage Of Time Production Costs Are Rising In Eastern Coastal China.This Is Why Factories Are Relocating To Western Regions.

http://www.ibtimes.com/china-promot...expensive-coastal-regions-move-inland-2370602

https://www.nytimes.com/2014/08/28/...ush-for-chinese-factories-to-move-inland.html


Now The Problem With These Regions Were That They Did Not Have A Cost Effective Access To Sea.This Is Where Gwadar Port Comes Into Play.So Now You Can See CPEC As Part Of A Bigger Game plan.A Part of CPEC Is Being Built In China and A Part In Pakistan

4.Pakistan May Not Be Earning Much From Gwadar Port But They Will Be Earning From Toll Taxes and Transit Fees From Motorways and Railways.

5.As A Result Of Chinese Policy Of Relocating Industries To Less Developed Interior and Western Regions,Both Xinjiang and Tibet Have Been Experiencing Double Digit Growth.This When There Only Export Markets Right Now Are Russia and Central Asia.Imagine The Growth When They Get Cheap Access To Sea.They Grow and We Grow With Them

6.Karakoram Highway Is Being Transformed Into An All Weather Road.90% Of The Work Has Already Been Done On This

7.Be Specific What Part Of CPEC Is Ahsan Iqbal Hiding?????


I Can Elaborate More Points If You Want

 

[Kathin_Singh]

It was Singapore which didn't go anywhere...

Build–operate–transfer
Build–operate–transfer (BOT) or build–own–operate–transfer (BOOT) is a form of project financing, wherein a private entity receives a concession from the private or public sector to finance, design, construct, own, and operate a facility stated in the concession contract. This enables the project proponent to recover its investment, operating and maintenance expenses in the project.

Due to the long-term nature of the arrangement, the fees are usually raised during the concession period. The rate of increase is often tied to a combination of internal and external variables, allowing the proponent to reach a satisfactory internal rate of return for its investment.

Examples of countries using BOT are Pakistan,[1]Thailand, Turkey, Taiwan, Bahrain, Saudi Arabia,[2]Israel, India, Iran, Croatia, Japan, China, Vietnam, Malaysia, Philippines, Egypt, Myanmar and a few US states (California, Florida, Indiana, Texas, and Virginia). However, in some countries, such as Canada, Australia, New Zealand and Nepal,[3] the term used is build–own–operate–transfer (BOOT). The first BOT was for the China Hotel, built in 1979 by the Hong Kong listed conglomerate Hopewell Holdings Ltd (controlled by Sir Gordon Wu).

Here Builder is not operator!

First it was Singapore company and Now a Chinese company.

It is a management contract not BOT and whoever has negotiated that contract is a fool or corrupt on Pakistani side.

 

[Samlee]

Here Builder is not operator!

First it was Singapore company and Now a Chinese company.

It is a management contract not BOT and whoever has negotiated that contract is a fool or corrupt on Pakistani side.

It Was Negotiated During General Musharraf Rule.Babar Ghauri Was Ports and Shipping Minister Hiding In USA Now

 

[Kaniska]

Not bad deal in long run...It is quite expected that China is paying for the entire cost of Gwadar, so they will have to make some margin for their money..And again, after 40 year, Pakistan will get another developed port like Dubai without spending a penny to it...So it is a win win for both countries...

 

[Kathin_Singh]

Spite China?... no.

Indians are Pakistan's mortal enemy... they are full of hate.... they will exterminate us and push us into the sea if we dont stand up to their terror and warmongering.

That is what taught to you. Truth is that We Indians are peace loving ,minding our bussiness type and jolly fellow. We have not invaded neighbours territory in past 5000 years .

 

[Samlee]

Not bad deal in long run...It is quite expected that China is not paying for the entire cost of Gwadar, so they will have to make some margin for their money..And again, after 40 year, Pakistan will get another developed port like Dubai without spending a penny to it...So it is a win win for both countries...

That Is My Point No. 2 On Post #26

That is what taught to you. Truth is that We Indians are peace loving ,minding our bussiness type and jolly fellow. We have not invaded neighbours territory in past 5000 years .

Really

https://en.wikipedia.org/wiki/Chola_invasion_of_Srivijaya

https://en.wikipedia.org/wiki/Chola_rule_in_Sri_Lanka