ISLAMABAD: Pakistan on Monday rushed to approve two infrastructure projects under the China-Pakistan Economic Corridor (CPEC) at a cost of over $11.3 billion aimed at putting them before the Chinese authorities for fast-track implementation during Prime Minister Shehbaz Sharif’s visit.
The Executive Committee of National Economic Council (Ecnec) approved the $10 billion Mainline-I project of Pakistan Railways and the $1.3 billion Karachi Circular Railway project. It was an emergency meeting as no Ecnec huddle was slated for Monday.
The committee gave “in principle” approval to both the schemes as no proper homework had been done before calling the meeting. Ecnec met hours before PM Shehbaz Sharif’s visit to China. Finance Minister Ishaq Dar chaired the meeting.
Ecnec approved, in principle, a 45% increase in the cost of ML-I project to nearly $10 billion. China had refused to provide funding at the earlier approved cost of $6.8 billion, which delayed the project for years.
Recently, Planning Minister Ahsan Iqbal appealed to China to fast-track the processing of ML-I project, else the railway’s main network would collapse in a year.
“Ecnec considered and approved, in principle, the Ministry of Railways’ modified PC-1 for up-gradation of Pakistan Railways’ existing Mainline-1 (ML-1) project at a total cost of $9.85 billion subject to the recommendation of cost, technical details and preferably an equity participation financial model,” said an announcement of the Ministry of Finance.
Last week, the Central Development Working Party (CDWP) – the first tier for the approval of mega development schemes – cleared the ML-I project for final approval by Ecnec. While clearing the project, the largest CPEC scheme, the CDWP issued certain directives, which remained largely unimplemented.
CDWP instructed that a project monitoring and implementation unit should be established by the Ministry of Railways to implement and monitor the project. It said that the increase in cost from $6.8 billion to $9.9 billion should be vetted by a third-party consultant and the certified cost should be submitted by the Ministry of Railways before the presentation of a summary to Ecnec. Also, the CDWP gave directives that the packaging and phasing of the project may be reviewed and intra-packaging adjustment may be carried out by the Ministry of Railways in consultation with the Chinese to make the work packages more realistic and practical. –Agencies
