Islamabad: Pakistan Prime Miniser Nawaz Sharif began a three-day visit to China on Friday.

During the trip, he will attend the annual meeting of Asia-Pacific Economic Cooperation (APEC) leaders in Beijing and also sign bilateral economic agreements.

In a statement before his departure for Beijing, the prime minister said the energy and infrastructure projects to be executed in Pakistan with China’s cooperation would provide jobs to thousands.

Dr Musadiq Malek, newly-appointed spokesperson for the prime minister, told journalists that the visit was aimed at rebuilding investor confidence shaken by the recent political crisis in the country.

Chinese President Xi Jinping was due to visit Pakistan in mid-September this year, but called off his trip due to the political protests in Islamabad.

“It is time to reach out to international investors and remove their misconceptions about the political situation in the country, which is why the government has decided to take this initiative,” Malek said.

The spokesman said 14 projects to be signed during the visit were exclusively aimed at the production of a total of 10,400MW of electricity in the coming years.

More than two dozen agreements will be signed with China during the two-day trip, Malek said by phone on Friday.

He said they will mostly be related to power generation and development in the southwestern city of Gwadar, where China is helping to build a port.

Chinese President Xi Jinping postponed a visit to Pakistan in September amid political demonstrations in Islamabad led by former cricket star Imran Khan against Sharif for allegedly rigging last year’s elections. Xi had been expected to sign $34 billion (Dh124 billion) of investment deals during that trip.

“We are going to sign many agreements which we couldn’t because of the postponement of the Chinese president’s visit,” Malek said.

Chinese support is a key part of Sharif’s plan for spurring the economy of South Asia’s second-biggest economy. An International Monetary Fund loan is another element.

Pakistan aims to raise its investment-to-GDP ratio to 20 per cent in three years from 12.6 per cent in year ending June 2013.

“There is only one investor ready to invest freely with open hands in Pakistan: China,” said Saad Khan, an economist at Karachi-based brokerage Arif Habib Ltd.

“Sharif going back to China means investors are willing to invest, and something is happening again in the energy sector, including coal power projects.”

 

Largest Partner

China has been Pakistan’s largest trading partner for four consecutive years with $15 billion of trade in 2013. It also became Pakistan’s second-largest export destination in 2011, followed by the US.

Sharif announced plans to construct a civil nuclear power plant with China’s help in November last year to help meet the nation’s power demand.

Power outages last as long as 18 hours a day in some areas. Blackouts have sparked violent street protests, shut factories in the past and were a key reason for the defeat of former president Asif Ali Zardari’s party in 2013.

Sharif’s first overseas trip was to China after being elected prime minister in May last year.

In its July review, the IMF said Pakistan’s economy was showing signs of improvement and raised its growth forecast to 4 per cent for the 2014-2015 fiscal year, 0.3 percentage point higher than its initial estimate. The IMF’s executive board will meet in early December and may make available two tranches totalling approximately $1.1 billion.

Sharif has pledged to revive Pakistan’s economy by attracting investment to energy and infrastructure development.

Foreign direct investment into Pakistan fell 27 per cent to $169.5 million for three months ended September, according to central bank data.

Sharif’s visit is coming a week after newly-elected Afghan President Ashraf Gani met Chinese leaders in Beijing.

China is concerned with militancy in its western region, which Beijing has said has links to militants based in regions on the border between Afghanistan and Pakistan. Chinese leaders have said the deadly attack on a train station in Yunnan province was masterminded by militants in Pakistan.

“Relations are great, but now there seems to be some difference in regional stance,” Rashid Ahmad Khan, professor of international relations at University of Sargodha said by phone. “They don’t want Pakistan to pursue a confrontational policy with India and interfere in Afghanistan.”

— With inputs from agencies