Pakistan has approached China for the provision $1.6 billion soft loan for the realignment of the Karakorum Highway from Thakot to Raikot under the umbrella of the China-Pakistan Economic Corridor (CPEC).
China has already given a green signal in this regard and now a concept clearance for the realignment of the Karakorum Highway from Thakot to Raikot project has been approved by the Central Development Working Party (CWDP) which will enable the governments of Pakistan and China to finalize the soft loan for the project.
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The estimated cost of the realignment of 256 kilometers of Karakorum Highway from Thakot to Raikot is $1.8 billion which will be shared with a ratio of 90 percent and 10 percent respectively by China and Pakistan, official sources explained.
China has agreed to provide $1.620 billion, while the government of Pakistan will furnish $180 million through the Public Sector Development Programme (PSDP), the sources maintained. The Chinese funding for the project will consist of maximum grants and soft loans, they added.
The realignment of the Karakorum Highway from Thakot to Raikot is being planned in view of the construction of three dams on the river Indus. The Ministry of Communications is in the process of getting a nod from the Planning Commission of Pakistan regarding the concept clearance for the realignment of the Karakorum Highway from Thakot to Raikot project, said the sources further. As soon as the project concept gets a green light, the grant/loan negotiations with the Chinese side will be finalized.
It is worth noting that China has also agreed on a G-to-G venture and partially funded the feasibility study and detailed design of the Karakoram Highway (KKH). Pakistan and China will jointly carry out the feasibility study and detailed design for the realignment of 256 kilometers of Karakorum Highway which is being relocated due to the construction of Pattan, Dasu, and Diamer Bhasha dams on River Indus, according to the sources.
