Environmental Pollution a Negative Externality from China Pakistan Economic Corridor (CPEC): Policy implications for Pakistan

• Main Author: Rehmat Karim, Faqeer Muhammad, Javed Akhter Qureshi, Naveed Razzaq, Akber Ali
• Format: Article
• Language: English
• Published: Society of Economic Geologists and Mineral Technologists 2020-08-01
• Series: International Journal of Economic and Environment Geology
• Online Access: https://www.econ-environ-geol.org/index.php/ojs/article/view/482/326

The China-Pakistan Economic Corridor (CPEC) is considered as the ‘flagship’ project of China’s Belt and Road Initiative (BRI) and has been widely acclaimed by both Chinese and Pakistani officials often terming it as ‘game-changer’ to overcome Pakistan’s lingering issues of energy and economic crisis. Within the framework of CPEC, China is investing more than 56 billion US dollars as Foreign Direct Investment (FDI) in various energy and infrastructure projects including a vast network of railways, highways, economic zones and gas pipelines. While much has been debated and written about various projects under CPEC in the existing academic discourses, vis-à-vis threats to the biodiversity (Nabi et al., 2017), its potential implications to environmental hazards (Ali, 2018) and to overcome energy shortfall of Pakistan (Kugelman, 2017). However, scientific study to reinforce the issues of environmental pollution, particularly related to CEPEC coal-based energy projects have been still lacking. The pertained literature on CPEC consisted qualitative studies to inspect and judge different aspects such as importance of CPEC for both countries and its effects on geo political of South Asia. Challenges for CPEC in Pakistan, South Asia and foreign policy between China-Pakistan), as Nan, (2015) explained that this project is not only valuable for Pakistan and China, but it is also beneficial for the global economy by including several other countries. Furthermore, Li and Sun, (2015) and Irshad, etal, (2015) reported the importance of CPEC and it long and short-term benefits for both countries. Further, Hussain and Khan (2017) also stated that it will enhance the cooperation between two countries and advantageous for Chinese, Middle Eastern and South Asian people (Ali, 2016). Further, Wolf, (2017) explained the insights, potentials and challenges concerning CPEC and domestic level cooperation between China and Pakistan. In addition, quantitative studies focused to shed a light on the impact of China Pakistan Economic Corridor (CPEC) (Such as, impact on gdp, socio-economy, trade, stock market, energy sector and infrastructure). CPEC will build rails and roads infrastructure and infrastructure development may decrease the poverty and increases the agriculture development in Pakistan (Ahmed & Mustafa, 2016). Most recent article examined the impact of CPEC impact on energy (energy consumption and energy saving potential) in the prospect of Pakistan (Mirza, Fatima, Ullah, 2019). A latest study surveyed in Pakistan and their research results shows that entrepreneur’s attitude and intentions to China and Pakistan Economic Corridor (CPEC) development is positive, it means CPEC project also designing an entrepreneurial environment (Kanwal et al., 2019). A large number of studies (Begum, etal., 2015; Ozturk, and Acaravci, 2010) have discussed various elements and causes of CO2 emissions. Similarly, many researches (Khurshid, etal., 2018; Hadi, etal., 2018; Hussain, 2017; Hussain, 2015) on Pakistan-China relations in the context of economy, society and geopolitical point of view. Present study is aimed to investigate the CPEC development effects i.e. gross domestic product (gdp), foreign direct investment (fdi), trade openness (top), energy consumption (enguse) on environmental pollution (CO2) in Pakistan using FMOLS and DOLS methods.