ISLAMABAD (The COW News Digital) Pakistan’s government has once again postponed approval of a major $1 billion project to rehabilitate and upgrade the Pakistan Railways ML-3 track, a key infrastructure link expected to facilitate the transportation of minerals from the Reko Diq mining project.
Financial constraints and a possible shift in the proposed mineral transportation route from Karachi to Gwadar are reportedly among the main reasons behind the latest delay.
According to officials at the Ministry of Planning, the Central Development Working Party (CDWP) has deferred the approval of the 996-kilometre railway rehabilitation project for the third time in five months.
The project aims to restore the railway line between Nokundi and Rohri, with an estimated cost of approximately Rs278 billion.
Officials have pointed out that the ML-3 railway track has reached the end of its operational lifespan, forcing trains to operate at an average speed of just 30 kilometres per hour.
A complete rehabilitation of the route is considered essential for transporting large quantities of minerals extracted from Reko Diq through the railway network.
Federal Planning Minister Ahsan Iqbal said the project’s approval had been delayed because further details were required regarding bridge financing arrangements with Barrick Gold.
The government has already approved a $390 million loan from the Reko Diq Mining Company to provide interim financing for the railway rehabilitation project. The proposed loan carries an annual interest rate of approximately six per cent.
However, officials say the financing arrangement may need to be reconsidered if the government decides to transport minerals through Gwadar instead of Karachi. In that case, Barrick Gold would need to provide fresh assurances that the financing would remain available under the revised transportation plan.
Under the original proposal, minerals from Reko Diq were expected to travel through Nokundi, Quetta and Rohri before reaching Karachi Port.
An alternative route is now under consideration, involving a road connection between Nokundi, Panjgur and Gwadar.
A delegation from Barrick Gold recently met Planning Minister Ahsan Iqbal and sought further details about the proposed Nokundi-Gwadar road project.
The minister has emphasised the need for close coordination between the federal government, the Balochistan government and mining companies to accelerate development of the proposed transportation corridor.
The repeated postponement highlights the financial and logistical challenges facing Pakistan’s plans to develop infrastructure for transporting minerals from Reko Diq, one of the country’s major mining projects.
