Rumors of Pakistan Economy Default until IMF Loans Return

In summary, the China-Pakistan Economic Corridor (CPEC) has the potential to alter the political landscape of South Asia. It may improve Pakistan’s international status, improve the geopolitical environment, and reduce defense spending. Additionally, the CPEC may help stabilize society by addressing security issues with the support of other countries. However, Pakistan’s economic sovereignty is largely dependent on China, as the CPEC is funded by a $46 billion loan from China. This loan is not an investment that China will recoup through the success of the CPEC. There are concerns about the stability of this arrangement, particularly under the current US administration. If the CPEC fails to generate expected profits, it is unclear how Pakistan will be able to repay the loan.