The signing of memoranda of understanding (MoUs) on the first Special Economic Zone (SEZ) by China and Pakistan take both sides to enter a new phase of China Pakistan Economic Corridor (CPEC). Also, the new agreement on free trade between the two governments is also of much significance for it will alleviate the dominant fear that the free trade between the two countries will harm Pakistani business. The new agreement on free trade signed by the two countries allows Pakistani goods to reach to 90 per cent of the Chinese market.

Apart from these two significant developments, the Chinese state will invest $ 1 billion in twenty-seven projects in Pakistan that the two sides have identified as crucial for socio and economic development of Pakistan. All these developments are welcome and will hopefully be a harbinger of a win-win situation for both sides as China claims is the ultimate aim of its Belt and Road Initiative (BRI). Moreover, the Prime Minister (PM) of Pakistan Imran Khan while speaking to the Chines entrepreneurs asked them to exploit the investment-friendly policies of his government. Being prudent investors, many Chinese entrepreneurs will respond to the call of the Pakistani PM asking them to establish their factories and manufacturing plants in the Special Economic Zone (SEZ).

However, two things need to be taken care of. First, the investors should face no bureaucratic hurdles if they honour the call of the PM. For, the first SEZ will be a model as well as a testing zone of Pakistan’s commitment to ensure business-friendly policies for foreign investors. Second, and most importantly, the local manufacturers, especially the ones who produce on a small scale and who cannot compete Chinese investors on their own, should not be left vulnerable to the brutal forces of the market. PM Khan cannot be more correct when he says that the CPEC has blossomed into a reality that ensures the bilateral cooperation in multiple fields including agri-business. However, as stated earlier, the state needs to protect the local farmers who may not compete with the Chinese agricultural fields.

The visit of Imran Khan to China has further strengthened the bilateral relations as is evident from the fact that China has committed to assist in developing different sectors of the Pakistani economy. One of such industries that will benefit the most will be Pakistan Railways. The up gradation plan seems like a complete overhaul of Pakistan Railways. CPEC with entering its second phase and Imran Khan’s earlier commitment that he will bring all CPEC agreements before the public for the sake of transparency, Pakistan should exploit the opportunities to their maximum, which are lying before it.