PAKISTAN’s Executive Committee of the National Economic Council (ECNEC) has deferred approval of the $US 6.7bn ML-1 project. A key link in the China-Pakistan Economic Corridor (CPEC), a subsection of China’s Belt and Road initiative, ML-1 involves track doubling and upgrades on 1726km of railway, recently revised downwards from 1872km).

However, on July 5 deputy prime minister, Mr Ishaq Dar, told local media outlet The Express Tribune, that in his role as chairman of ECNEC, he has instructed the Railways Division to present a fresh summary with funding details and to divide the project into packages.

The planning ministry contradicted an official statement from the deputy prime minister’s office on the ML-1 project saying that the project is not being delayed. However, Dar confirmed that the project is deferred and has been sent back for further refinement.

China has previously raised concerns about the high cost of the project and requested a reduction. Last month, the Pakistani government slashed the cost by one third to $US 6.7bn, but it has not been able to obtain secured funding.

The Railways Division submitted the ML-1 project summary to ECNEC without arranging funding from the Public Sector Development Programme, China, or any other international financial institution.

China is reportedly willing to finance the $US1.1bn first phase from Karachi to Hyderabad, while Pakistan is trying to secure funding for the $US 3.3bn Karachi - Multan section. Pakistan has requested a loan from China to cover 85% of the project cost, but the terms remain under discussion.

The Planning Commission previously assessed the ML-1 project as “unviable” due to cost reductions that significantly altered its design and scope, including compromises on speed limits, line capacity, rolling stock and axleloads.

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