Pakistan Railway Projects.

[ghazi52]

Pakistan, China move forward with ML-1 financing, construction plans

July 28, 2021



ISLAMABAD: Pakistan has formally asked China for providing loans for construction of the much-awaited Mainline-1 (ML-1) of rail line from Karachi to Peshawar in USD instead of Chinese RMB currency or a combination of both currencies could be acceptable for moving forward.

Top official sources confirmed to The News here on Tuesday that Pakistani authorities have communicated five major points to Beijing officially for evolving consensus on financing agreement for the construction of multi-billion dollar strategically important ML-1 project under China Pakistan Economic Corridor (CPEC).
The Joint Coordination Committee (JCC) was postponed recently between the two sides and it was not yet known when the JCC was going to be rescheduled. However, Pakistan officially conveyed its response to Chinese for finalizing the financing agreement on the ML-1 project.

The Chinese side want to provide a loan for ML-1 in RMB currency but Islamabad conveyed that Pakistan prefers the loan in US dollars or a combination of US dollars and RMB currencies for the convenience of Chinese side.

China has also offered Pakistan a combination of favorable terms and conditions and commercial loans for construction of ML-1 but Pakistani side is insisting upon extending lenient conditions only. The Pakistani side communicated to China that the Framework Agreement for ML-1 stipulates that Beijing will provide financing for the project on softer terms, being a strategic project.

Consistent with this stipulation and the fact that CPEC related projects were provided concessional financing terms, the project is proposed to be financed by Chinese side on concessional terms. Pakistan will accept favorable financing terms which as compared to previous CPEC Infrastructure projects.

There are differences over share of loan from Chinese side for construction of the project as Pakistan had initially proposed 90 percent share of loan from China and 10 percent from Pakistani side. However, Chinese side proposed that its share should be 85 percent and Pakistan should provide the remaining 15 percent resources for construction of the ML-1 project. After hectic negotiations, Pakistani side agreed to the Chinese proposal of its 85 percent loan of the cost of ML-1.

The Chinese team also proposed 15 to 20 years tenure of the project, however, Pakistan argued that the construction of ML-1 might hover around for 10 years and the payback of loan period take another 15 years, so Islamabad proposed a 25 year tenure of the loan including a 10 years grace period. China has asked for repayment of principal and interest in half a year and Pakistani side agreed to it and also accepted that the government would extend the guarantee to the Chinese loan amount.

The Executive Committee of the National Economic Council (ECNEC) had approved ML-1 at an estimated cost of $6.8 billion on the 90:10 percent cost sharing basis by the China and Pakistani side. The ECNEC had basically three different component of ML-1 project including package-I of ML-I at the cost of US$ 2.7 billion which include Nawabshah-Rohri Section (183 Km), Multan-Lahore Section (339 Km), Lahore-Lalamusa Section (132 Km), Kaluwal-Pindora Section (52 Km) and upgradation of Walton Railway Academy at Lahore.
Under Package-II, the cost of $2.67 billion was approved for up-gradation of Kiamari-Hyderabad Section (182 Km) and Hyderabad-Multan Section (566 Km) excluding work done on Nawabshah-Rohri Section in Package-I. Under Package-III, the ECNEC approved a cost of $1.42 billion for construction of Lalamusa-Rawalpindi Section (105 Km), Rawalpindi – Peshawar Section (174 Km) and establishment of dry port near Havelian.

 

[ghazi52]

A view of newly constructed 'Hassan Abdal' Railway station.....

 

[HAIDER]

So, unfortunately, we are importing tracks from China and our steel mill is closed. Otherwise same tracks would be built at a much lower cost and save foreign exchange.

 

[ghazi52]

Railways to finalise bidding for outsourcing 17 trains in Sept: CEO

Safdar Rasheed
29 Aug 2021

LAHORE: “The Pakistan Railways (PR) has decided to outsource 34 commercial trains of which 17 trains have received bidding which will be finalized in the first week of the next month. Concessions given to 17 categories on rail travel including journalists will continue in the outsourced trains.”

Chief Executive Officer of Pakistan Railways, Nisar Ahmad Memon, said this while talking to reporters at Railway Headquarters on Saturday.

He further said the management of commercial outsourced trains would be allowed to increase fares by a maximum of 10 percent but they could reduce it at their own discretion. The service and quality of trains will be improved under new agreement.

Talking about the financial health of Pakistan Railways, he said during the current fiscal year Rs 1.5 billion were saved as compared to last fiscal year but the PR had to pay to 130,000 pensioners due to which financial condition could not improve.

During the last year, the revenue was Rs 50 billion and the expenditure was Rs 95 billion. During the last year, Rs 38 billion was paid in the head of pension and there is an annual deficit of Rs 45 billion.

Copyright Business Recorder, 2021

 

[ghazi52]

 

[ghazi52]

𝗧𝙊𝘿𝘼𝙔 𝙄𝙉 𝙃𝙄𝙎𝙏𝙊𝙍𝙔 :
𝗗𝗨𝗔𝗟𝗜𝗭𝗔𝗧𝗜𝗢𝗡 𝗢𝗙 𝗥𝗔𝗜𝗟𝗪𝗔𝗬 𝗧𝗥𝗔𝗖𝗞 𝗙𝗥𝗢𝗠 𝗞𝗛𝗔𝗡𝗘𝗪𝗔𝗟 𝗧𝗢 𝗥𝗔𝗜𝗪𝗜𝗡𝗗

 

[ghazi52]

 

[FuturePAF]

I hope they start in the areas of worst track (and possibly structural deficient Br, so we can avoid major accidents first and foremost. The area near Sukkir has terrible tracks the last time I heard. It’s these worst places that should be rebuilt first.

The. We can build new signals systems, and then the major ports and stations, and then finally the tracks in between all these.

If there is one thing the government should open up to Overseas Pakistanis investing in its the railways. They have good potential to get ROI especially if a connection to Central Asia can be built, either from Quetta to Turkmenistan, Peshawar to Uzbekistan, or up through Gilgit Baltistan to China.

 

[ghazi52]

The Pakistan Railways (PR) planned to upgrade and rehabilitate the Narowal-Kartarpur track to facilitate Sikh pilgrims visiting Gurdwara Darbar Sahib Kartarpur from across the border, it emerged on Wednesday.

A feasibility report prepared in this regard is likely to be presented to the Ministry of Railways this week. It takes into account several important features of the prospective track, including its cost, maintenance of station buildings, railway gates, signal system and waiting rooms.

The section has been inactive since 2003 due to its decrepit and faulty lines and had been deemed unsafe for operations. Under the project, a new railway track will be laid at a cost of Rs1 billion.

According to the details, the railway authorities took the decision to provide better facilities and smooth travelling to the pilgrims.

The station masters' rooms, ticket booths, cabins, signal systems, railway gates and waiting rooms for pilgrims will be upgraded.

Meanwhile, special measures will be taken to ensure that the passengers are provided adequate facilities for unloading and loading their luggage from the train as compared to the normal railway stations and for carrying them to and from the station.

According to the sources, PR Chief Executive Officer Nisar Ahmed Memon said that with the resumption of train service, not only the pilgrims would get a decent travel facility, the railways would also generate more revenue.

 

[ghazi52]

Pakistan Railways cargo service to be Reformed

Pakistan Railways is determined to upgrade cargo transportation services to facilitate the industry, said Pakistan Railways Secretary Habibur Rehman Gilani.

He also said that the initiative would reduce the cost of doing business for the industry and enable exporters to compete with regional competitors.

He dispelled the impression that cargo handling was not a priority of the entity.

“Cargo handling by Pakistan Railways increased from 0.4 million tons in 2012 to over 5 million tons in 2017,” he revealed.

He expressed the commitment to further improve the cargo handling segment by focusing on cost-effective, expeditious, and state-of-the-art cargo movement.

“Pakistan Railways, being an essential component of economic security of the country, is being upgraded to ensure least human interaction for the provision of quality services,” he said.

“The department has already outsourced its freight handling segment to Pakistan Railways Freight Transportation Company and we are in the process of outsourcing passenger trains as well.”

He announced complete facilitation for businessmen from his organization in terms of logistics and cargo transportation.

The secretary called for forming a joint railways-Aptma committee for the resolution of day-to-day operational issues.

Speaking on the occasion, Aptma Chairman Rahim Nasir highlighted the strengths and potential of the textile industry of Pakistan.

He emphasized that the textile sector was on a growth trajectory with a lofty export target of $21 billion for the current fiscal year.
He pointed out that the sector shipped merchandise worth $15 billion abroad last year.

“The industry is set to receive a new investment of $5 billion, add 100 new plants and create 500,000 extra jobs,” he announced.

He appreciated the government for providing an enabling environment for the growth of the textile industry. “The consequent increase in exports is earning foreign exchange for the country.”

The Aptma chairman proposed a dedicated freight corridor for effective and expeditious transportation of cargo.

 

[ghazi52]

CPEC’s ML-I is a strategic project of BRI

November 30, 2021



Upgradation of the Pakistan Railway’s Mainline-I, which runs north to south connecting the country, is envisaged under the multibillion dollar China-Pakistan Economic Corridor (CPEC) – a flagship project of the Belt and Road Initiative (BRI). The goal is to revamp and modernize the dilapidated railway infrastructure of Pakistan.

The project has great strategic importance for Pakistan and China, as it would revive the backbone of the railway network. The project was declared a “strategic project” by the Joint Cooperation Committee (JCC) of CPEC in 2017. It, thus, reflects a high-level consensus between leadership and policymakers of both countries.

Significance of the ML-I project can be gauged from the fact that Pakistan’s present railway track and allied infrastructure were initiated during the 19th century under the British Raj. In 1947, at the time of independence, Pakistan inherited the same infrastructure and continued to run it. Now population dynamics have changed and along with it the infrastructure has degraded as it is a 150 year old system.

A modern railway network is a strategic requirement of Pakistan’s economy and supply chain systems. It will improve logistics transportation systems, save transportation time, promote connectivity and improve the quality of travel across the country.

The goal of connectivity through CPEC is unachievable without upgrading the ML-1 of Pakistan railways. The upgradation and expansion of ML-1 is, thus, considered as a big milestone in the improvement and modernization of Pakistan railways.

ML-I spans nearly 1,872 kilometers.
The estimated cost of expansion and reconstruction of the ML-1 projects is $6.8 billion.

In 2015, technical experts from both China and Pakistan undertook a joint feasibility study. It was carried out by China Railway Eryuan Engineering Group Corporation, Ltd, NESPAK and PRACS. The report from the feasibility study was deliberated at the JCC in 2017, and at that time, the committee approved the study and gave a go-ahead for the next stage of the project i.e., realizing financial close and finalizing the design and other technical details.

Under the proposed framework, the ML-I project consists of three packages: first, to upgrade the track between Lala Musa to Lahore, Lahore to Multan, and Nawab Shah to Rohri. The second package will focus on modernization of the track between Lala Musa and Rawalpindi, Nowshera-Peshawar and Hyderabad Karachi section. The third package will focus on upgradation of Multan Khanewal to Sukkur section.

After the upgradation and completion of the project, the entire track will be a modern dual track.


. The speed of passenger trains will increase from existing 65-110 kilometers per hour to 160 kilometers per hour, while freight trains will be able to run at the speed of 120 kilometer per hour. Moreover, Pakistan railways will have a computer based signaling and control system, reducing inefficiencies and accidents, while grade separation will be implemented to ensure the safety of train operations.

It was in 2017 that JCC agreed to undertake the project and the framework agreement was signed in May, 2017 during the visit to Beijing of then Prime Minister Nawab Sharif. Since then, both sides have remained engaged in talks for financial closure, with work not yet commenced. For three years, both sides have negotiated on the estimated cost of the project and mode of financing.

Earlier, it was suggested that the project would cost more than $8 billion. This was an expensive undertaking for Pakistan, as the federal government had initially approved the project cost of $7.2 billion over eight years. Pakistan sought to reduce the cost. In 2020, both sides agreed to a reduce projected cost of $6.8 billion and the Executive Committee of the National Economic Council approved the project in August 2020.

Next, talks commenced for exploring financing arrangements for the project. Pakistan sought government concessional loan from China on low-interest rates in the USD denomination, as it considers ML-I a strategic project for both sides. China proposed a combination of commercial and concessional loans, with mix of RMB and USD components. The interest rates in Pakistan’s proposed financing facility are lower than the China proposed arrangement.

Given Pakistan’s current economic challenges, partly owing to the impact of the COVID-19 pandemic, it will be a difficult undertaking for Pakistan to make timely payments if it takes commercial loans for the ML-I project. It would also lead to delays in the implementation of the project and possible cost overruns. Already the start of the project has been delayed for over four years. Given ML-I is a strategic project and consensus was reached between the leaders of two countries, it is important that both sides address such issues in a timely manner for early commencement of the construction of the project.

In September, 10th JCC was held virtually and the two sides reviewed progress on CPEC projects. Pakistan and China also reviewed progress on ML-I project and decided to remain engaged on finalizing its financing arrangements. As both countries consider ML-I a strategic project, it would be in their common interest for both to display flexibility and finalize the financing mechanism through a proactive approach.

After its completion ML-I will play a major role in enhancing connectivity and supporting new economic activity. Pakistan has already proposed extension of ML-I to the Torkham border and onwards to Afghanistan.

The Chinese side has expressed interest in exploring such an extension. When materialized, ML-I it will inevitably enhance connectivity with Afghanistan, Central Asia and directly enhance Pakistan and China’s trade with Iran, Turkey and Central Asia and go on to become a success story of the BRI. Besides, ML-I will be cherished as China’s major contribution toward Pakistan and its people’s well being from an old and time tested friend. Both Pakistan and China still rejoice and take pride in the joint venture construction of the Karakoram Highway; ML-I would be an additional feather in the cap.

 

[ghazi52]

Hutchinson Ports Pakistan commenced testing their freight train operations by sending laden boxes to Lahore from Karachi.

 

[ghazi52]

Pakistan, Uzbekistan vow to expedite construction work on Trans Afghan Railway project

Pakistan and Uzbekistan have reaffirmed to expedite work on construction of Trans Afghan Railway between Tashkent, Kabul and Islamabad.

The resolve was expressed during meeting between Minister for Railways Azam Khan Swati and Transport Minister of Uzbekistan in Islamabad.

 

[ghazi52]

The Christmas train will take passengers from Karachi to Lahore, Karachi to Sialkot, and vice versa.

 

[ghazi52]

€170 Million investment by Al Furqan Group UAE, for the construction of a new 105km rail track under Thar Coal Rail Track Project.

Railway Constructions Pakistan Limited (RAILCOP) has signed a memorandum of understanding (MoU) with M/s Al Furqan Holdings Private Ltd and BIL Pakistan (Pvt.) Ltd for the construction of a new 105-kilometer rail track in Thar Coal...