China is pumping cash into Pakistan, but that might not convince other foreign investors

Posted In: News Date:Feb 19th, 2018

China is pouring an estimated $60 billion into Pakistan as part of its Belt and Road Initiative (BRI), but financial experts CNBC spoke to were uncertain how this would impact Islamabad's profile as an investment destination.

The China-Pakistan Economic Corridor (CPEC), as this leg of China's massive regional infrastructure spending push is known, will boost Pakistan in the eyes of investors, said Farrukh Khan, a specialist on the country's economy.

"I would expect other foreign direct investment flows to increase as the CPEC projects near completion and resolve some of the infrastructure shortcomings in Pakistan, particularly energy," he said via email.

But not everyone agrees. "Chinese activity in Pakistan is certainly raising Pakistan's profile, but only in a narrow way," Derek Scissors, an expert in the region at the American Enterprise Institute, told CNBC.

"International investors are attracted to improved infrastructure but they are less drawn by what Pakistan itself has accomplished and more by what China has done in Pakistan."