Projecting impact of CPEC on Pakistan’s electric power crisis

ABSTRACT

The commencement of China–Pakistan Economic Corridor has led to the appreciation of Pakistan’s economic outlook from 5.4% to 5.8% by the World Bank. The upgraded outlook is a welcome sign but it is still trivial, essentially attributable to the electric power crisis, which approximately trims 2% of Pakistan’s economic growth annually. Almost 60% of the CPEC (China–Pakistan Economic Corridor) funds are directed at Pakistan’s energy sector, hence, demanding careful attention of both researchers and policy analysts alike. The study is based upon a meta-analytic review of literature concerning CPEC and Pakistan’s energy sector. The results of the study demonstrate that CPEC is an easing agent for Pakistan’s energy crisis (82.30%). The results also highlight points of concern, including inadequate planning (47%), dilapidated electricity distribution system causing losses (64.7%), and an unsustainable energy mix (64.7%). The study further validates the findings via Spearman’s Rho-Correlation. The rρ value for the possible “resolution of Pakistan’s energy crisis” is 0.5426 achieving a significance level of 98% and a corresponding p-value of 0.0252. The significant negative rρ value attained is −0.4894 which establishes the fact that lack of planning can hinder the energy crisis resolution.

KEYWORDS:

• CPEC
• FDI
• power crisis
• transmission losses
• energy crisis
• sustainable-energy mix
• Spearman’s rank correlation

Acknowledgments

The authors thank Professor Jianxun Chu at the University of Science and Technology China (USTC) at the School of Public Affairs for providing lab facilities to undertake this research.

Disclosure statement

No potential conflict of interest was reported by the authors.

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.