The Asian Development Bank (ADB) has made a financing proposal for the $10 billion Mainline-I (ML-I) project on the China-Pakistan Economic Corridor (CPEC), a planning ministry official said on Wednesday. The satisfaction of the presence of the second investor
“ADB has offered to finance the ML-I project,” Planning Minister Zafar Ali Shah said while talking to reporters at his office.
“Pakistan is still working with Beijing on this project and is eager to launch the first phase of $2.7 billion,” Shah said in response to a question. However, sources said that China is yet to sign the financing agreement due to various circumstances and weak financial position of Pakistan.
This is the second time that ADB has shown interest in a pending project and it is also the only project that has been declared of strategic importance under CPEC.
The Asian Development Bank offered to finance the project nearly eight years ago, but China rejected the offer.
Diplomatic sources involved in the talks said the ADB has only offered financing for some of the ML-I projects that were severely damaged in the recent floods. He said that the financing and the scope of the proposal of the Asian Development Bank have not been finalized at this stage. Of the total cost of $10 billion, Pakistan will receive $8.4 billion in loans from China, but negotiations have not been finalized and Islamabad will arrange the remaining $1.5 billion.
In rupee terms, the cost of the project, which was a staggering 2 trillion rupees when it was approved four months ago, has reached 2.7 trillion rupees at current exchange rates.
Pakistan has decided to implement the project in a phased manner and will accordingly allocate $8.4 billion in loans to ensure smooth construction while reserving loans if needed. However, due to the negligence of the Pakistan Teliku Enserf (PTI) government, the ML-I project remained on the sidelines, leading to a tripling of the cost of Rs. But for the past 10 months, the Pakistan Democratic Movement (PDM) government has also failed to break the deadlock with China.
When Prime Minister Shabaz Sharif visited China in November, Pakistan
