Pakistan, China to Finance Karachi-Peshawar Railway (ML-1) Project in Phases

Pakistan and China have decided not to proceed with the lump sum $6.8 billion financing agreement for the Karachi-Peshawar Railway (ML-1) Project, sources informed ProPakistani. Instead, both parties have decided to finance the project in phases. Sources said the authorities will split the main line project into two separate contracts for phased construction. Phase I will provide financing of $3.2 billion and will be finalized next month. This phase will include the construction of railway lines from Karachi to Hyderabad and Hyderabad to Multan. The second phase, covering the Multan to Peshawar section, will follow once a feasibility study is completed after the first phase is successfully completed. Sources said financing terms for Phase I will involve long-term loans from China, and Pakistan will push for a low interest rate. Initially, both sides had discussed a lump-sum $6.8 billion financing agreement, but no consensus was reached, leading to the phased contract approach. Phase I will proceed in two steps, with the Karachi-Hyderabad line under the first package and the Hyderabad-Multan line under the second.