Beijing is set to upgrade a 1,163-miles track from Karachi to Peshawar near the Afghan border with an $8 billion loan to Pakistan. It’s part of Chinese President Xi Jinping’s Belt and Road trade initiative, which includes $60 billion of badly-needed works financed in Pakistan.
Though approval for the Chinese-funded upgrade has been delayed — amid wrangling over financing — Pakistan’s Interior Minister Ahsan Iqbal said in a statement on Wednesday that the first phase of the work would start this year.
In the past decade, the nation’s rail network had become a byword for corruption, delays and filth. Now the unprofitable state-owned Pakistan Railways has doubled its revenue to 40.1 billion rupees ($362 million) in the past five years and aims to do so again over the same time period, Parveen Agha, secretary of Pakistan Railways, said in an interview in Islamabad.
“This is one of the biggest opportunities for us,” Agha said. “This is the up gradation of the entire railway system.”
To help ease increasing congestion in Pakistan’s second-largest city, a $1.6 billion metro-line in Lahore funded by Chinese banks is scheduled to open before this year’s vote. In total, Islamabad says it has rehabilitated more than 300 locomotives, over 1,000 passenger coaches, nearly 5,000 freight wagons and 31 stations. Pakistan also purchased 75 high-powered locomotives last year in a $413.5 million deal with General Electric Co.