The Planning Commission of Pakistan has identified huge disparity in unit prices of Chinese skilled labourers and that of Pakistani labourers in ML-I project in China-Pakistan Economic Corridor (CPEC).
According to comments of the Employment & Research Section of the Commission, the unit price has been calculated at the rate of US$59.65 and US$4.50 per man per day for Chinese and Pakistani labourers respectively.
The unit price of Chinese skilled labourer is more than 1,300 percent higher as compared with the Pakistani labourer which needs to be rationalized, the Commission proposed.
Moreover, the ratio of Chinese labourers to Pakistani labourers for different categories of work is 1:9, but in case of equipment installation and tunnel work, this ratio has been shown as 3:7 which needs to be reduced to an appropriate level for the purpose of cost rationalization, the Commission suggested.
It has been mentioned in PC-I that all the raw material will be procured from local markets except steel which will be imported, for which it proposed that steel may be purchased from local market apparently on BOT.
The project may be outsourced to the private sector instead of being operated and executed by the Pakistan Railways because the expenditure-revenue gap of the PR is on the rise and subsidy of over Rs30 billion have been given every year by the federal government, which is expected to increase with the passage of time as mentioned in PC-I.
It noted that the private sector has the capacity to revive the dying public sector projects, and it has been mentioned in PC-I under Employment Generation that 16,000 local labourers/tech experts will be hired and 2,000 Chinese technical experts will be employed as well as 150,000 indirect jobs will be created.
However, their bifurcation in the allied industries also needs to be provided, and the cost of the project needs to be mentioned in local currency terms as indicated in the instructions of PC-I form.
Moreover, cost of local items/expenditure may be mentioned as local component and only imported items need to be mentioned as FEC keeping in view the exchange rate volatility, it proposed.
The Commission also suggested that the cost of generating cheap electricity through generators (25 percent of total capacity) needs to be rationalized to not more than the level of Rs15/unit.