China to provide 90% funding for $6.8 bln Pakistani railway project — minister

Policemen walk along trains stationed on a deserted platform at Karachi Cantonment railway station in Karachi on March 26, 2020. Under the $6.8 billion Mainline-1 (ML-1) project, Pakistan’s 2,655 km railway tracks will be upgraded to allow trains to move up to 165 km per hour, while the line capacity will increase from 34 to over 150 trains each way per day. (AFP/File)
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Updated 19 August 2020
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China to provide 90% funding for $6.8 bln Pakistani railway project — minister

  • Construction of Mainline-1 (ML-1) project will start by year end, Shaikh Rashid Ahmed says 
  • At $6.8 billion, the ML-1 project is almost equal to Pakistan’s entire development budget for this fiscal year

KARACHI: Federal Minister for Railways Shaikh Rashid Ahmed said on Tuesday China would provide 90 percent financing for a $6.8 billion initiative to upgrade the 1,872 kilometers Mainline-1 (ML-1) railway project, the country’s costliest project to date as part of the multibillion-dollar China-Pakistan Economic Corridor (CPEC) agreement.

CPEC has seen Beijing pledge over $60 billion for infrastructure projects in Pakistan, central to China’s wider Belt and Road Initiative (BRI) to develop land and sea trade routes in Asia and beyond.

“About 90 percent of financing for the project will be provided by the Chinese government [through the government concessional loan] while the remaining amount will be shared by us,” the railways minister told Arab News in an interview. 

“The process of tendering will start in the first week of September and take about two months to complete. We will most probably start implementing the project by the end of the year,” he said, adding that the project was scheduled to be completed in five years. 

Under the project, Pakistan’s existing 2,655km railway tracks would be upgraded to allow trains to move up to 165km per hour — twice as fast as they currently do — while the line capacity would increase from 34 to over 150 trains each way per day.

“When the ML-1 Project is completed, the speed of trains will more than double the current 65-110 kilometers per hour to 165 kilometers per hour,” Ahmed said. “Our cargo trains will also operate at a speed of 120 kilometers per hour.”
“We will also eliminate all crossings,” he added. “The new fully automatic [computer-based signaling and control] system will be installed, and underpasses and overhead bridges will be constructed.” 
Ahmed said the project would provide job opportunities to more than 150,000 people, of whom 90 percent would be Pakistanis and 10 percent would be Chinese nationals. 
“After the successful completion of ML-1, we will also focus on ML-2 and ML-3,” he said. 
The move ahead on ML-1, which has been on hold for years, will dispel notions that the government of Prime Minister Imran Khan is seeking to roll back some of the mega Chinese-funded projects that he himself had questioned when in opposition.
The ML-1 Project will be executed in three phases to avoid commitment charges, the minister said. The loan amount for each package would also be separately contracted to double the tracks from Karachi to Peshawar via Hyderabad, Nawabshah, Rohri, Rahimyar Khan, Bahawalpur, Khanewal, Sahiwal, Lahore, Gujrawala and Rawalpindi. 
At $6.8 billion, the ML-1 project is almost equal to Pakistan’s entire development budget for fiscal 2020/21, which stands at 1.32 trillion Pakistani rupees.
“One can only comment on the financing strategy [of the railway project] after more details become public. However, if its rate is within the same range offered by the World Bank to its affiliated institutions, then it is fine,” Dr. Ikram ul Haq, a Lahore-based financial analyst, told Arab News. “But if it is higher then comparative bidding should have been the best way.”


Pakistan raises petroleum prices citing ‘increasing trend’ in international market

Updated 6 sec ago
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Pakistan raises petroleum prices citing ‘increasing trend’ in international market

  • Pakistan has increased the prices of petrol by 4.53 rupees ($0.016) to 293.94 rupees
  • Government also increases price of high speed diesel by 8.14 rupees to 290.38 rupees

KARACHI: Pakistan has increased the price of petrol by 4.53 rupees ($0.016) to 293.94 rupees with effect from today, Tuesday, the finance ministry said in a statement, citing rising petroleum prices internationally. 

The government also increased the price of high speed diesel by 8.14 rupees to 290.38 rupees, the post said.

The price hikes come as Pakistan has initiated discussions with the IMF over a new multi-billion-dollar loan agreement as its current nine-month, $3 billion loan program expires with the disbursement of a final $1.1 billion tranche likely to be approved later this month.

Reforms linked to that bailout, including an easing of import restrictions and a demand that subsidies be removed, fueled record inflation, with the rupee hitting all-time lows. Authorities also raised petrol and diesel prices to record highs to meet conditionalities. 

“The prices of Petroleum products have seen an increasing trend in the international market during the last fortnight,” the finance ministry said as it announced the new prices. 

“The Oil & Gas Regulatory Authority (OGRA) has worked out the consumer prices, based on the price variations in the international market.”

Under the last IMF bailout, Pakistan was told to prevent further accumulation of circular debt in its power sector, arising from subsidies and unpaid bills. For a new program, the South Asian nation will need to implement reforms to reduce costs by improving electricity transmission and distribution, moving captive power into the grid, improving governance, and combating theft. 

It will also have to maintain power and gas tariffs at levels that ensure cost recovery, with adjustments made to safeguard the financially vulnerable, through existing progressive tariff structures.

In a report released in January, the IMF noted Pakistan missed its target for power sector arrears, largely due to lower-than-expected recoveries and tariffs.


WHO warns of falsified cough syrup ingredients seized in Pakistan

Updated 21 min 39 sec ago
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WHO warns of falsified cough syrup ingredients seized in Pakistan

  • Five contaminated batches of propylene glycol falsely labelled as made by Dow Chemical units in Asia and Europe
  • Contaminated cough syrups linked to deaths of more than 300 children globally since late 2022

The World Health Organization issued an alert on Monday warning drugmakers of five contaminated batches of propylene glycol, an ingredient used in medicinal syrups, that appear to have been falsely labelled as manufactured by Dow Chemical units in Asia and Europe.

The Drug Regulatory Authority of Pakistan (DRAP) issued three alerts between January and March over high levels of ethylene glycol (EG), an industrial solvent known to be toxic, found in drums purportedly made by subsidiaries of Dow Chemical in Thailand, Germany and Singapore.

DRAP sent suspect drums of propylene glycol, a sweet-tasting alcohol used in over-the-counter medicines such as cough syrups, for testing. The samples were found to have EG contamination of 0.76-100 percent, according to the WHO. International manufacturing standards say only trace amounts of EG, below 0.1 percent, can be considered safe.

Contaminated cough syrups made in India and Indonesia have been linked to deaths of more than 300 children globally since late 2022. The medicines were found to contain high levels of EG and diethylene glycol, leading to acute kidney injury and death. In the Indonesia case, authorities found that one supplier had placed false Dow Thailand labels onto drums containing EG that it sold to a distributor for pharmaceutical use.

Several of the batches seized by DRAP were labelled as having been manufactured in 2023, the WHO said, months after the agency issued a global alert calling on drugmakers to verify the quality of their suppliers.

The WHO said Dow confirmed that the materials identified in its Monday alert and found by DRAP were not manufactured or supplied by the company.

“The propylene glycol materials identified in this alert are considered to have been deliberately and fraudulently mislabelled,” the WHO said, noting batches may have been distributed to other countries and still be in storage.

Dow did not immediately respond to a request for comment.

The WHO alert comes the same week regulators in Tanzania and Rwanda joined Nigeria, Kenya and South Africa to recall batches of Johnson & Johnson children’s cough syrup after Nigeria said it found high levels of diethylene glycol, an industrial solvent known to be toxic.

The batch of Benylin Paediatric syrup recalled was made by J&J in South Africa in May 2021, although Kenvue now owns the brand after a spin-off from J&J last year.


Pakistan court strikes down clause setting gender-based age criteria for marriage

Updated 15 April 2024
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Pakistan court strikes down clause setting gender-based age criteria for marriage

  • The verdict was given on a petition seeking amendments to Child Marriage Act over gender-based distinction
  • The court asks the Punjab government to issue a revised version of 1929 law in 15 days, based on its judgment

LAHORE: A high court in Pakistan on Monday struck down a section of the Child Marriage Act, 1929 that dealt with gender-based age distinction and ordered the government in the Punjab province to revise the legislation.

The verdict was given on a petition seeking amendments to the Child Marriage Act over apparent distinction on the basis of gender. The petitioner had stated in his petition that the Constitution of Pakistan granted equal rights to men and women.

The Lahore High Court (LHC) declared as “discriminatory” the 95-year-old act’s Section 2(a) and (b), which respectively fixed 18 and 16 years as legal ages for boys and girls for marriage. 

“In sum, the words in section 2(a) viz . ‘if a male ….and if a female is under sixteen years of age’ being unconstitutional are held to be without lawful authority and of no legal effect. They are struck down,” Judge Shahid Karim wrote in his five-page verdict.

“The Govt. of Punjab (its relevant department) is directed to issue the revised version of 1929 Act (based on this judgment) within the next fifteen days and shall also upload that version on its website for information.”

Though the aforementioned law had been replaced by the Punjab Child Marriage Restraint (Amendment) Act, 2015 to criminalize child marriage in Punjab, Pakistan’s most populous province.

Women in Pakistan are often deprived of their basic rights and forced to marry against their will, in some cases even before reaching the legal age for marriage.

According to the Human Rights Commission of Pakistan (HRCP), about 500 women are killed each year by their family members over accusations that their “honor” has been violated, which are often triggered when women marry by choice.

The court observed there was a need to take effective steps against child marriages as the marriage laws in the country were meant to primarily keep in view the “social, economic and educational factors rather than religious.”

In his verdict, the judge referred to Article 25 of the constitution, which says: “All citizens are equal before law and are entitled to equal protection of law. There shall be no discrimination on the basis of sex.”

“The definition of ‘child’ in the 1929 Act while making a distinction on the basis of age, is not based on an intelligible criteria having nexus with the object of the law,” the court ruled.

“The definition is indeed a special provision for the protection of women but in the process it tends to afford greater protection to males by keeping their age of marriage higher than females.”


Pakistan PM urges increase in renewable energy resources to cut oil import bill

Updated 15 April 2024
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Pakistan PM urges increase in renewable energy resources to cut oil import bill

  • Pakistan lacks adequate resources to run its oil- and gas-powered plants and imports most of its energy needs
  • The country is currently faced with a balance of payments crisis, record inflation and steep currency devaluation

ISLAMABAD: Prime Minister Shehbaz Sharif on Monday directed the Pakistani energy ministry to maximize utilization of renewable energy resources in order to reduce the country’s oil import bill, Pakistani state media reported.

The remarks came at a meeting he presided over to review the country’s power sector, according to a report published by the Radio Pakistan broadcaster.

The prime minister said that oil imports worth billions of dollars could be controlled by using alternative resources like solar, wind and hydel power.

“The country currently imports oil worth 27 billion dollars to meet its power and transportation needs,” Sharif was quoted as saying in the report.

“In the future, only clean and low-cost hydropower and renewable plants will be installed in the country.”

Pakistan, which has been struggling with a balance of payments crisis, record inflation and steep currency devaluation, lacks adequate resources to run its oil- and gas-powered plants and imports most of its energy needs.

The South Asian country is currently looking to secure cheaper energy imports and alternate ways to lessen the cost of power generation.

The prime minister asked authorities to speed up efforts for foreign investment in solar energy projects as well as to accelerate the process of privatization of power generation companies and auction of inefficient power houses.

He lauded the performance of the Punjab government in the ongoing drive against power theft and expressed hope that other provinces would also follow suit to overcome the challenge.

“All possible measures are being taken to reduce the per unit price of electricity for the common man,” PM Sharif added.


Finance minister discusses investment plans with US-Pakistani businessmen in Washington 

Updated 15 April 2024
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Finance minister discusses investment plans with US-Pakistani businessmen in Washington 

  • Muhammad Aurangzeb arrived in the US on Sunday to participate in spring meetings of the IMF, World Bank
  • Pakistan is in need of external financing to shore up forex reserves to escape another macroeconomic crisis

ISLAMABAD: Pakistan’s Finance Minister Muhammad Aurangzeb on Monday met with a delegation from the US-Pakistan Business Council (USPBC) in Washington D.C. and discussed with them his government’s commitment to improving business climate in Pakistan.

Aurangzeb arrived in Washington D.C. on Sunday to participate in spring meetings of the International Monetary Fund (IMF) and the World Bank, amid Islamabad’s efforts to reach an agreement with the IMF for a new loan program by June this year.

The South Asian country of more than 240 million people remains in desperate need of external financing to shore up its foreign exchange reserves and escape yet another macroeconomic crisis after it barely averted a default last year, thanks to a $3 billion IMF program.

In order to overcome the present economic woes, Islamabad has been making efforts to attract foreign direct investment to keep the $350 billion economy afloat.

“During the meeting, the Finance Minister highlighted the government’s dedication to attracting both foreign and domestic investments in key sectors,” Aurangzeb’s ministry said in a statement. “These sectors include agriculture, IT, mines & minerals, and energy.”

Pakistan's Federal Minister for Finance and Revenue, Muhammad Aurangzeb (5L), meets with a delegation from the US Pakistan Business Council in Washington, US, on April 15, 2024. (Pakistan Finance Ministry)

The statement came days after Aurangzeb met with Prime Minister Shehbaz Sharif to discuss Pakistan’s economic strategy ahead of his meetings with IMF and World Bank officials.

“He discussed with the prime minister his scheduled meetings with the International Monetary Fund, World Bank and other organizations during the visit,” the Pakistani finance ministry said. “The overall economic situation of the country was also discussed in the meeting.”

Pakistan this month completed a final review of its current $3 billion IMF deal that cleared the way for the disbursement of a final tranche of nearly $1.1 billion. The South Asian country is now looking for another bailout program.

Last week, IMF chief Kristalina Georgieva confirmed Pakistan was in discussions with her organization on a potential follow-up loan program to its nine-month, $3 billion stand-by arrangement (SBA).

The IMF chief recognized Pakistan’s commitment to structural economic reforms during an event at the Atlantic Council think tank in Washington. She, however, noted that some important issues, including the tax base and overall economic transparency, were yet to be addressed by Pakistani authorities.