ISLAMABAD – Pakistan seek $8 billion from China on defence loans terms forthe strategic ML 1 project of the Pakistan Railways.
Pakistan wants China to take the $8.2 billion Pakistan Railways’ (PR) MainLine project (ML-1), which is declared a strategic project under theChina-Pakistan Economic Corridor (CPEC), on the same loan terms as defenseand other military-related projects.
This was revealed by Secretary Railways Sikandar Sultan Raja while briefingthe Senate Standing Committee on Railways, with Muhammad Asad Ali KhanJunejo in the chair.
The secretary also revealed that the Sindh government is willing to takethe $2.6 billion Karachi Circular Railway (KCR) project with JapanInternational Cooperation Agency (JICA) again, which is offering a loan atfavorable terms compared to China.
PR’s director general (DG) (Planning) informed the committee that theproject will consist of ML-1 upgrade and establishment of a dry port asshort term goals, establishing new rail link from Gwadar to Mastung andBesima to Jacobabad for mid-term goals and establishing new rail link fromHavelian to Khunjrab (China border) as the long term goal – with anestimated cost of $8.2 billion in three packages over five years.
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He said the first package would cost $2.248 billion while the cost of thesecond and third packages would be cleared after completion of preliminarydesign. The PC-1 or Package-1 is based on cost estimates validated bythird-party review consultants.
The committee expressed serious concern over the $8.2 billion costs due tothe rupee depreciating against the dollar, saying the country would pay amuch higher price. The committee was informed that out of the $8.2 billion,a major chunk would be spent on imports where PR would pay around 33percent duty/taxes on imports.
