The core railway lines in western Pakistan are old and backward, and the extremely low operating speed seriously restricts the development of mineral exports and port freight transportation. In order to overcome transportation bottlenecks, the local government has finalized a foreign financing plan, relying on funds from Canadian mining companies to launch mainline upgrades and renovations, and to help improve the quality and efficiency of regional transportation and logistics.

Project Overview and Financing

The ML-3 railway mainline in Pakistan has a total length of 996 kilometers and is the core transportation channel in the western region. The maximum operating speed of the old line is only 15 kilometers per hour, and the freight capacity is seriously insufficient. The total investment for this upgrade project is about 1 billion US dollars, and the local government plans to introduce a two-year transitional loan of 390 million US dollars from Reykjavik Mining Company to support the construction. The project will be promoted in two stages. From 2026 to 2030, 585 million US dollars will be invested to renovate core facilities, and from 2031 to 2033, 145 million US dollars will be invested to improve supporting facilities. After the renovation, the speed of the line will be increased to 100 kilometers per hour, and 11 new stations will be built simultaneously. Keywords: Pakistan railway upgrade, infrastructure breakthrough

Building multiple challenges

The progress of this railway upgrade project is facing prominent obstacles, with significant safety and financial risks. The security cost of the project is as high as 162 million US dollars, accounting for 17% of the total cost. The complex security environment along the route poses hidden dangers for construction and operation. At the same time, short-term transitional loans need to be fully repaid by 2028, which increases local financial pressure, and there is a huge gap in official special budget funds. Failure to implement funds properly may lead to project delays and cost increases.Editor/Min Jing