Pakistan and China have agreed to divide the $6.8 billion Main Line-1 (ML-1) railway project into two phases, according to sources in the Finance Ministry.
The first phase, valued at $3.2 billion, is expected to begin next month. This phase will cover the construction of the railway line from Karachi to Hyderabad and from Hyderabad to Multan. The second phase will focus on extending the track from Multan to Peshawar, with a feasibility study for Phase II to be conducted after the completion of Phase I.
Both phases will have separate agreements, with the financing terms for Phase I set to be finalized with Chinese officials this month. Pakistan plans to secure a low-interest loan from China for the project’s financing.
The ML-1 project, a key initiative under the China-Pakistan Economic Corridor (CPEC), will span a total length of 1,872 kilometers. Originally, Pakistan had been negotiating for a single agreement covering the entire project, but both sides ultimately decided to split the project due to its large scope and high cost.
The division of the ML-1 project mirrors a previous decision made by the PML-N government to manage the scale and cost of the ambitious railway upgrade.
