7
Pakistan's current railway system. - File Photo
ISLAMABAD: The Export-Import Bank of China will loan Pakistan $1.7 billion to develop a city-wide train system in the eastern city of Lahore, a senior Pakistani government official said on Wednesday.
The 15-year loan will be disbursed in the next five years, and negotiations with Eximbank are under way to finalise other details, Khawaja Ahmed Hassan, chairman of the Lahore Transport Company (LTC), said.
“The bank agreed to lend us the money with a two-year grace period, and our aim is to get it at six per cent interest,” he told Reuters.
The Punjab government recently agreed to award the 27 km (16.7 mile) train line contract project to the Chinese company China North Industries Corp (Norinco). In 2008, a French company had estimated the cost of the project at $2.4 billion.
The Chinese “were very kind and they brought down the cost of the project to $1.7 billion,” Hassan said.
He said the project was likely to begin by the end of 2011.
Lahore, the capital of Punjab province, Pakistan’s most populous and prosperous province, is home to more than five million people.
Officials expect the new transport system, the first of its kind in the country, will substantially decrease road traffic.
“There will be a big change. If we are able to bring here the system which we saw in China, thousands of vehicles (will) eventually go off the road,” Hafiz Nauman, a provincial lawmaker and senior member of the LTC, said.
He said another Chinese company will supply 111 buses to the city in June.
Seen as an “all-weather friend” to Pakistan, China has invested heavily in infrastructure development, particularly in the strategic and mineral-rich southwest, bordering Iran and Afghanistan.
China Three Gorges Corp, China’s largest hydropower developer, is ready to invest $15 billion in Pakistan’s troubled energy sector, an investment that could add 10,000 megawatts to Pakistan’s main grid over the next 10 years, a senior company official told Reuters in an interview on April 7.
China is a main supplier of military and defence hardware to Pakistan, and has helped the country build nuclear power plants.
The Chinese “were very kind and they brought down the cost of the project to $1.7 billion,” Hassan said.
Shouldn't I be laughing at this line? A "kind friend" offering loans to be used by its own companies and to be paid back by Pakistan. If such loans are kind, any country would be willing to give that to Pakistan.
A step in the right direction. Development of an efficient and modern transport system in the need of time, will greatly save gasoline and curb pollution.
We have been listening such kind of news since ages ago but so far have not seen any thing in real or practically. Similarly to the past, I think this will again just remain as news. As far as the actual project initiation is concerned, I do not think it will start.
The culture-city of Lahore has been in need of an appropriate city-trasport system since long to help it to open and air its choked situation. Let us hope that the present plan would do the job and not fritter away as just a hiccup act.
Take loans from China,it is Ok?? But why don't you manufacture your own trains or Buses? It means we will always depend on them for these things,so that profit will go to their pockets.
I cant understand why 1.7 billion dollars loan is going to be taken from China which this system cannot pay back. Electrify existing railway section from Raiwind to Shahdra and link it up to Wagah border. Buy few new bogies and efficiently run the system. This will surely fill the purpose and at few million dollars cost. These rulers will destroy this country country by borrowing money for publicity stunts.
You are right friend. China knows We won't be able to repay the loan. But they are showing their generocity to convince that they are our friend. A old chinese saying is there "Don't let others know fishing,instead give them some fish".Why they don't give us technology for railways ??because they also want business and exploit us.They don't even give aid for Balochis like USA. Chinese are just opportunists, they will grab us for their benefit. We don't want ur loan,ur company to execute projects here,chinese labours also.If you really want to help us ,provide us technology.