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CPEC & Opportunities for Food &

Agriculture Industry in Pakistan


Introduction to CPEC & Long Term Plan
Source: cpec.gov.pk/
Introduction Potential areas of cooperation/development include:
China-Pakistan Economic Corridor is a • Regional Connectivity
framework of regional connectivity. CPEC • Transport Infrastructure
will not only benefit China and Pakistan • Energy Hub/flows
• Logistic Hub/flows
but will have positive impact on Iran, • Trade & Commerce
Afghanistan, India, Central Asian • Peace & development of region
Republic, and the region. • Connectivity/Harmonization/Integration of civilizations
• Diverse Investment opportunities
• Industrial Cooperation
• Financial Cooperation
• Agricultural Cooperation
• Tourism
• Educational linkage
• Human resource development
• Health Care
• People to people contact
• Increase in livelihood opportunities
• Enhance Security and stability of the region
Route Plan - CPEC
The project will be completed in different phases lasting till 2030.
It includes Highways, Railway Network & Fiber Optic lines.
CPEC – Route Development Plan Source: cpec.gov.pk/
Estimated
Project Name Length (KM) Details
Cost(US$ M)
Road

Envisaging Improvement and widening of KKH Section of 440 Km from


1 KKH Phase II (Thakot -Havelian Section) 120 Raikot to Islamabad. The scope also includes provision of bridges, culverts 1,366
and other allied facilities.
Peshawar-Karachi Motorway (Multan- Karachi – Peshawar Motorway envisages construction / development of 6-
2 392 2,980
Sukkur Section) Lane access controlled Motorway having total length of 1,100 Km.
3 Khuzdar-Basima Road N-30 (110 km) 110 Balochistan 80
Upgradation of D.I.Khan (Yarik) - Zhob,
4 210 Khyber Pakhtunkhwa - Balochistan 195
N-50 Phase-I (210 km)
KKH Thakot-Raikot N35 remaining
5 136 719.8
portion (136 Km)
Rail Sector Projects
Rehabilitation/improvement of existing track that will follow the existing
alignment except at locations where sharp curves are to be eased out or
Expansion and reconstruction of eliminated to allow higher speed upto 140 Km/h.
6 1,830 8,172
existing Line ML-1
Karachi to Peshawar via Hyderabad, Nawabshah, Rohri, RahimyarKhan,
Bahawalpur, Khanewal, Sahiwal, Lahore, Gujrawala, Rwalpindi, Peshwar
To meet the demand of containerized future freight traffic in connection
with Pak-China Economic Corridor, the dry port will be established at
Havelian Dry port (450 M. Twenty-Foot
7 Havelian by utilizing the railway land, railhead facilities, high speed / 65
Equivalent Units)
capacity stock, and potential of well established off-dock terminal for
handling bonded import / export containers.
Capacity Development of Pakistan
8
Railways
CPEC Long Term Plan
Impact of Agriculture & Food industry in Pakistan
CPEC – Long Term Plan for Agriculture
Long term plans in CPEC will only help improve agricultural produce of Pakistan. Focus is also to
reduce wastage and costs.
To summarize CPEC Long Term Plan includes following plans related to Agricultural and industrial
development.
- Strengthen the upgrading of agricultural infrastructure in the regions along the CPEC.
- Promote the construction of water-saving modern agricultural zones, and increase the
development and remediation of medium- and low-yielding land to achieve efficient use of
resources.
- Strengthen cooperation in the fields such as crop farming, live stock breeding, forestry and food
growing, and aquatic and fishery in the regions along the CPEC, with the highlight on technical
exchange and cooperation in the fields of development of comprehensive agricultural production
capacity, construction of farmland water conservancy facility and agricultural products circulation
facility.
- Improve post-harvest handling, storage and transportation of agricultural products, and innovate
in marketing and sales models.

Source: Exclusive: CPEC master plan revealed, https://www.dawn.com/news/1333101


CPEC – Long Term Plan
• Asadabad, Islamabad, Lahore and Gwadar will see a vegetable processing plant, with annual output
of 20,000 tons, fruit juice and jam plant of 10,000 tons and grain processing of 1 million tons.
• Projects include the construction of one NPK fertilizer plant as a starting point “with an annual
output of 800,000 tons”.
• Meat processing plants in Sukkur are planned with annual output of 200,000 tons per year, and two
demonstration plants processing 200,000 tons of milk per year.
• In crops, demonstration projects of more than 6,500 acres will be set up for high yield seeds and
irrigation, mostly in Punjab.
• In transport and storage, the plan aims to build “a nationwide logistics network, and enlarge the
warehousing and distribution network between major cities of Pakistan”. Storage bases will be built
first in Islamabad and Gwadar in the first phase.

Source: Exclusive: CPEC master plan revealed, https://www.dawn.com/news/1333101


CPEC – Special Economic Zones in Pakistan Source: cpec.gov.pk/

Project Name Type of industry Area

Type of Industry:
1 Rashakai Economic Zone , M-1, Nowshera Fruit/Food/Packaging/Textile Stitching/Knitting
1000 acres

2 China Special Economic Zone Dhabeji To be determined during feasibility stage 1000 acres
Fruit Processing, Agriculture machinery,
Pharmaceutical, Motor Bikes Assembly, Chromites,
3 Bostan Industrial Zone Cooking Oil, Ceramic industries, Ice and Cold storage,
1000 acres
Electric Appliance, Halal Food Industry

Allama Iqbal Industrial City (M3), Textile, Steel, Food Processing, Plastics, Agriculture
4 Implements, Pharmaceuticals, Engineering.
3000 Acres
Faisalabad
Steel, Food Processing, Pharmaceuticals & Chemicals,
5 ICT Model Industrial Zone, Islamabad Printing & Packing, Light Engineering.
500 Acres

Development of Industrial Park on


Steel, Auto & Allied, Pharma, Chemical, Printing &
6 Pakistan Steel Mills Land at Port Qasim Packaging, Garments
1500 Acre
near Karachi
7 Special Economic Zone at Mirpur,AJK Mix industry 1078

8 Mohmand Marble City FATA

9 Moqpondass SEZ Gilgit-Baltistan 250


CPEC & Export Opportunity with
Chinese Food Consumption Pattern
What Pakistani food processing industry can gain from CPEC and efficient access to
Chinese markets.
Chinese Food Consumption – Opportunity for Pakistani exports
• “China is the world’s largest importer of agricultural products and we have to grab our due share through the revisit of
FTA between two countries which is mandatory for us,” Federation of Pakistan Chambers of Commerce & Industry (FPCCI) Regional
Chairman on Horticulture Exports Ahmad Jawad

• Major imports include Meat Products & Seafood, Vegetables, Sweets & Confectionery, live Oil & Coffee.
Confectionery includes high quality chocolate and snacks and there are interesting opportunities for companies who
focus on the production of truffles or premium biscuits.
• 60% of the global soybeans are imported by China. Which is mostly used as animal feed. Projections are that imports
of feed, oilseeds, meat as well as high value products will only increase.

In 2015 China was the


world's largest importer of
vegetables (with 15% of the
market share), the seventh
largest importer of food
products (with 5% of the
market share) and fourth
largest importer of animals
(with 7% of the market
share).
Chinese Food Consumption – Opportunity for Pakistani exports
With a population of 1.3 billion people, China consumes
almost $ 1 trillion worth of food every year, he said and added
that with increased urbanization and rising incomes, Chinese
consumption patterns are also changing, and demand for high
quality imported food items is growing at a pace much faster
than population growth.

The trend shown in graph was predicted to be on growth for


the next 30 years.

Pakistan agriculture and food processing companies have an


opportunity to explore from the given options for export to
China. CPEC will help reduce cost of delivery and time to reach
Chinese markets.

Food consumption trends in China


While Chinese consumer's tastes
have shifted, the nation's farmers
haven't been able to keep up with
demand. That's not likely to
change anytime soon.
Chinese Food Consumption – Opportunity for Pakistani exports
Pakistan agriculture and food processing companies have an
opportunity to explore from the given options for export to
China. CPEC will help reduce cost of delivery and time to reach
Chinese markets.

Currently major export in food from Pakistan to China are


Vegetables. Worth $250 million. CPEC is an opportunity to
expand this number.
In addition to China CPEC will open new trading routes
with Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan,
Turkmenistan and Uzbekistan.
Imports from China – Efficiency for Pakistan
On the other hand CPEC opens routes to Chinese
technology and other exports for Pakistani companies.

- Pakistan imports more than $6 billion worth of


machinery annually.

- With CPEC the costs & lead times of importing these


machinery will reduce and help food processing plants
to invest more in technology.
Easy access to remote agricultural producing cities
With CPEC access to new cities will open in Pakistan. This will
increase reach, efficiencies and reduce costs of procurement
of food produce within Pakistan.

• According to documents available with Online, initially


Kashgar, Taxkorgan, Khunjrab, Peshawar, Islamabad, Lahore,
Multan, Sukkar, Quetta, Karachi and Gwadar will be
included in the CPEC project.
• In the second stage, Gilgit, Chilas, Dasu, Thakot, Shankiari,
Mansehra, Khanpur, Haripur, Havelian, Burhan, DI Khan,
Mughal Kot, Zhob, Quetta, Khushab, Darya Khan, Jam Pur,
Khuzdar, Faisalabad, Sama Satta, Lodhran, Lala Musa,
Khanewal, Sahiwal, Gujranwala, Wazirabad, Rawalpindi,
Golra, Taxila, Attock, Nowshehra, Landi Kotal, Hyderabad,
Rohri, Dadoo, Larkana, Habib Kot, Shikar Pur and
Jacobabad will be included in the CPEC project.
Key Takeaways
• CPEC incorporates Short term and Long term plans. The expected completion of the project is in 2030.
• CPEC includes special development projects with China, which will impact the food & agricultural industry of
Pakistan.
• It includes specific plans to set up food processing plants in 5 new Industrial zones. Which means more
competition will emerge in food industry in next 10 years.
• Joint venture will be initiated for Vegetable processing plant with annual output of 20,000 tonnes. Also a JAM
& Fruit Juice production facility with an annual capacity of 10,000 tonnes.
• With rising food imports in China, Pakistan food industry has an opportunity in exports of vegetables,
soybeans, meat & chocolate confectionery to China.
• Currently Pakistan exports $250 million worth of vegetables to China.
• Imports costs and lead times will decrease and Pakistani food industries will have a better access to Chinese
food technology and expertise.
• Currently Pakistan imports $6 billion worth of machinery & equipment for its industries annually.
• CPEC will open new efficient access to remote agricultural cities in Pakistan and will reduce lead times & costs.
Reference sources:
• http://cpec.gov.pk/
• https://www.dawn.com/news/1333101
• http://cpec.gov.pk/brain/public/uploads/documents/CPEC-LTP.pdf
• https://www.thenews.com.pk/latest/257655-cpec-long-term-plan-launched
• http://www.fao.org/docrep/007/y5460e/y5460e06.htm
• https://wits.worldbank.org/CountryProfile/en/Country/PAK/Year/2016/TradeFlow/Export/Partner/CHN/Product/All-Groups
• https://nation.com.pk/13-Nov-2015/nine-major-cities-of-pakistan-china-to-be-included-in-cpec
• https://www.bestfoodimporters.com/china-food-imports-2016-trending-sectors/
• https://www.bloomberg.com/graphics/2017-feeding-china/
• https://connectamericas.com/content/demand-imported-food-growing-among-china%E2%80%99s-middle-class
• http://www.worldstopexports.com/chinas-top-10-imports/
• https://www.sipri.org/commentary/blog/2016/china-and-world-food-security
• https://www.cnbc.com/2015/10/21/how-hungry-is-china-for-the-worlds-food.html
• https://profit.pakistantoday.com.pk/2017/09/01/cpec-provides-pakistan-with-godsend-to-enhance-agriculture-exports-to-china-fpcci/
• https://tribune.com.pk/story/1518708/cpec-chinas-food-market/
Thank You
Secondary Research by: Ahmed Zaheer