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ISLAMABAD: Pakistan is likely to shelve the much-talked about Pakistan Railways ML-1 project due to disagreement between Islamabad and Beijing, well-informed sources told Business Recorder.

This issue was discussed at CPEC Review Committee meeting presided over by Minister for Planning, Development and Special Initiatives, Ahsan Iqbal.

“Ministry of Railways stated that PC-1 of ML-1 project was not feasible as costs were not agreeable to the Chinese side,” the sources said adding that Minister directed that Minister for Railways should be appraised of the matter and a report should be submitted to the Ministry of Planning, Development & Special Initiatives.

The ML-l project of Pakistan Railways was the largest proposed infrastructure project of the country under CPEC to which Executive Committee of the National Economic Council (ECNEC) accorded approval at an estimated cost of US$ 6.8068 billion on August 5, 2020.

Pakistan, China agree to execute ML-1 project

For the financial negotiation of loan terms with the Chinese side, a high level Financing Committee headed by Deputy Chairman Planning Commission was formed under the directives of Prime Minister which has convened eight meetings so far on the issue of financing of ML-1 project.

On April, 8, 2020 a proposed term sheet comprising of various terms of loan was shared with the Chinese side. However, final terms and conditions of the loan were to be settled after due deliberations and negotiation process between the Financing Committees of the two countries. A formal request for the loan of Package-1 amounting to US $ 2.435 billion was made to the Chinese side through Economic Affairs Division (EAD) on November 25, 2020.

The issue of Pakistan Railways ML-1 has been discussed at different levels in Islamabad and Beijing but both sides could not evolve a consensus on the cost of the project.

The meeting also took the following decisions: (i) the long-term plan of CPEC shall be broken down into respective sectors and the implementation plans shall be made part of the agenda of CPEC review meetings;(ii) a proposal regarding the permanent structure of CPEC may be prepared and submitted to Planning Ministry;(iii) seed development shall be incorporated into the agenda of the agriculture sector Joint Working Group;(iv) Pakistan Software Development Board shall be coordinated for Development/Certification of 100,000 youth in ERP Oracle etc.

Certification shall be of international standard and readily acceptable for overseas employment; and (v) Interior Division shall be approached to resolve business visa extension issues faced by Chinese expatriates in Pakistan. It was also decided that Executive Director (Operations), CPEC Authority shall coordinate with respective Ministries for compliance with the above decisions and submit a report for the perusal of the Minister for Planning, Development & Special Initiatives.

Copyright Business Recorder, 2022


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K Fareed Khan Apr 28, 2022 07:30am
The transport infrastructure to Gawadar should have been paired with our railway upgradation, even conditional to it. We did not ask US to do it for their access to Afghanistan as a condition.
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Adnan Dastgir May 02, 2022 05:19am
ML-1 would only be economically viable if undertaken by Pakistani companies only. Chinese are here to mint profits. Pakistan must take the project ownership and let chinese be contractors for specific jobs like done in metro bus projects.
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