by Shafqat Ali
ISLAMABAD, Nov.8 (Gwadar Pro) - Pakistan and China will use Renminbi (RMB) instead of the US dollars to finance more than $ 9 billion Karachi to Peshawar Railway Main Line-I (ML-I) and other multi-billion-dollar China-Pakistan Economic Corridor (CPEC) projects, officials here said.
Senior Pakistani officials said China had long proposed to use RMB instead of dollars to make it easier. “We (Pakistan) have not objections. We have agreed to the proposal,” said a senior official after this week’s Joint Cooperation Committee (JCC) meeting in Islamabad.
The ministers of 9th JCC meeting said in order to fundamentally resolve the financing issue, based on the important consensus reached by leaders of the two countries, the two sides agreed to drive RMB financing in CPEC projects.
The two sides recognized that financing had always been a notable bottleneck for CPEC project execution. The Chinese side has set up an inter-department work mechanism for RMB financing at the secretariat level.
In terms of ML-I, a separate work mechanism is set up under Joint Working Group (JWG) on transportation infrastructure, responsible for both technical issues and financing coordination. Both sides will work through their respective inter-department teams to finalise the financing arrangement.
The JCC was informed that the PC-I of the project was in approval stage and the bidding documents of ML-I were under process and will be finalised by December 15.
The Chinese side agreed to constitute a high level committee for financing negotiations in near future. Pakistan has already established ML-I interdepartmental financing committee.
Pakistan Minister for Railways Sheikh Rashid Ahmed said ML-I was flagship project of the incumbent government and Prime Minister Imran Khan was taking personal interest for earlier completion of the project.
He said ML-I project worth $ 9.2 billion was a heart of the CPEC which would further strengthen the brotherly relationship between Pakistan and China.
He said Pakistan Railways was a transport source of poor that would decrease the distance among the different cities of the country and travel timings.
The minister said ML-I was crucial project which would not only bring revolution in Pakistan Railways but also strengthen the economy and to link Pakistan with China, Central Asia and Iran.
He thanked the Chinese government for their full cooperation in the ML-I project, adding the project would be completed in next five years.
Ahmed said the government would invite Chinese political leadership on the inaugural ceremony of the project after the completion of ML-I.
Regarding three mass transit projects in Karachi, Quetta and Peshawar, both sides agreed on moving forward based on readiness of each project. For Karachi Circular Railway, Pakistan will submit the financing request to China.
About the Quetta Mass Transit and Greater Peshawar Mass Transit, both sides agreed on considering the projects in next JWG meeting after approval of PC-I of both schemes.
On the western route Pakistan has requested China to consider signing a framework agreement for commencement of Dera Ismael Khan to Zhob project in 2020 and the Chinese side agreed to have internal consultation in this regard.
The JCC was informed that Metallurgical Corporation of China (MCC) and Donghua Steel had significant willingness to participate Pakistan Steel Mills up-gradation.
The Pakistani side requested to constitute a joint technical working group at G to G level to prepare proposal for the re-alignment of Thakot-Raikot Section of the Karakoram Highway.