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Pakistan in negotiations to receive Chinese help for developing its energy sector

08 July 2010 , 08:49Yahoo finance1578

 

 

Pakistan's president appealed for Chinese help in developing his country's stagnant energy sector, pointing to nuclear power as one growth area but making no public mention of a deal with China that has alarmed the U.S. and others. The weeklong visit to China is Asif Ali Zardari's fifth since he came to office in September 2008, underscoring the robust diplomatic, military and commercial ties between the neighbors. He met President Hu Jintao on Wednesday and signed six agreements, including one on economic and technology cooperation. Details were not made public. The visit highlights China's support for Pakistan as they face scrutiny over a 2008 deal that would give energy-starved Pakistan two new nuclear power plants. Critics said transferring the reactors would violate international nonproliferation agreements.

 

"This deal comes at a time to assure the people of Pakistan that despite their repeated requests to the West to give them such a deal ... it is China once more which they rely can on as an all-weather friend," said Adnan Bukhari, an associate research fellow at the S. Rajaratnam School of International Studies of Singapore's Nanyang Technological University. The deal also came shortly after a wide-ranging deal that allowed the U.S. to sell nuclear fuel, technology and reactors to India, a regional rival of both China and Pakistan. Bukhari said the China-Pakistan deal is sending a message in particular to India, whose relationship with Pakistan has been of varying tensions for decades. Both countries have nuclear weapons.

 

Zardari met with Chinese business leaders Wednesday in industries ranging from banking to defense in a bid to attract investment, according to a statement from his spokesman, Farhatullah Babar. He singled out energy as a growth industry in Pakistan. Electricity shortages are chronic in Pakistan, where expansion of supply has lagged fast-growing demand. Some regions experience electricity outages of up to 18 hours a day and it is not uncommon for prolonged blackouts to provoke riots. Authorities planned to feed the grid through "hydro, coal, gas, nuclear and renewable energy sources," the Pakistan statement said, without elaborating on the growth of nuclear energy.

 

Pakistan, whose former top nuclear scientist has been accused of trafficking sensitive nuclear technology to Iran, Libya and North Korea, has not signed the Nuclear Nonproliferation Treaty, the main international agreement meant to stem the spread of nuclear weapons technology. China signed the treaty in the 1990s. India also has not signed the treaty. Mark Hibbs of the Carnegie Endowment for International Peace said in an April report that the U.S.-India deal was given the go-ahead by member states of the Nuclear Suppliers Group -- which seeks to limit the spread of nuclear-related equipment -- only after "considerable arm-twisting ... by the United States, France and Russia." Yet Washington has expressed concern that China's nuclear deal with Pakistan doesn't have the necessary approval from the NSG, and has called for China to provide more information about it.

 

"In the past half-year or so, making peaceful use of nuclear energy has been a sensitive issue," said Wang Lian, an associate professor in the School of International Studies at Peking University. "The U.S. government has been urging the Chinese government to make the process more transparent." So far, planning for the construction of the two reactors at the Chashma site in Pakistan's Punjab province has apparently gone forward. "The United States and other NSG states may object to the pending transaction but they cannot prevent China from exporting the reactors," Hibbs said in his report. Other countries are also concerned about the risk of an attack on nuclear facilities by insurgents battling the Pakistani military in the country's northwest tribal areas adjacent to Afghanistan, Bukhari said.

 

"The more you expand your nuclear programs or installations, there is more threat of attacks on them or maybe stealing of your equipment or your weapons," he said. Pakistan maintains that it has stringent security at its existing nuclear facilities and screening of staff to prevent infiltration of their ranks. China has said the deal would be carried out in line with "international obligations" and subject to international safeguards and supervision. A Chinese Foreign Ministry spokesman did not answer a question about a nuclear deal with Pakistan in a news conference Tuesday. 

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