Key ally accuses PTI govt of abandoning ML-I project

Sheikh Rashid irked by Planning Commission suggestion to get third party cost verification


Shahbaz Rana August 27, 2019
File photo

ISLAMABAD: The railways minister on Monday accused the government of abandoning the $9 billion Mainline-I (ML-I) project under pressure of the International Monetary Fund (IMF) after the Planning Commission proposed to get yet another cost validation.

The ML-I is the only project of the China-Pakistan Economic Corridor (CPEC) that has been declared strategically important under its May 2017 Framework-Agreement, signed between China and Pakistan.

Sheikh Rashid – a key ally of Prime Minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) – leveled the allegations during the Cabinet Committee on CPEC meeting, said sources who attended the meeting.

They said Sheikh Rashid appeared disturbed after the Planning Commission suggested to get the third party cost verification of $2.4 billion worth phase-I of the $9 billion project.

The cabinet body was also given a briefing on the Orange Line train project, whose infrastructure and equipment has started decaying due to callous attitude of the Punjab government.

The provincial government is also reluctant to ensure water supply, electricity and complete drainage work that has further delayed project completion.

It was the fourth meeting of CPEC cabinet committee since the PTI came into power. The meeting was chaired by Federal Minister for Planning and Development Makhdom Khusro Bakhtiar.

“PM Imran wants to undertake the ML-I project but the Planning Commission is not cooperating,” said Rashid while talking to The Express Tribune.

The minister said the PM gave September 15 deadline to the commission to approve the PC-I of the project but the commission seemed afraid of the National Accountability Bureau (NAB).

“The Planning Commission has bad intentions and it is also deceiving and misleading,” said Sheikh. “The commission does not want to undertake the project.”

The meeting had been called to review progress on CPEC projects, to approve the concept of CPEC Authority and schedule of the next meeting of the Joint Cooperation Committee (JCC) of CPEC.

Hardly a week ago, Imran Khan had directed the Ministry of Planning to fast-track work on the much-delayed $9 billion ML-I project. The PC-I of the first phase of the project, valuing $2.4 billion, was currently pending with the Ministry of Planning for a decision.

The bureaucracy is reluctant to move forward due to the ongoing NAB investigations into two mega road projects of CPEC. During the cabinet committee meeting, the commission also suggested to get clearance of the ML-I Framework Agreement from the Public Procurement Regulatory Authority (PPRA).

The IMF agreement imposes general restrictions on creating additional external public debt related liabilities besides imposing restrictions on increasing stock of sovereign guarantees.  These restrictions have affected the government’s ability to contract a big project like CPEC’s ML-I project.

Early this month, Secretary Planning Zafar Hasan had informed a parliamentary body that the Ministry of Planning did not have clarity about whether the country could sign a new loan deal with China for the construction of $9 billion ML-I project.

The Cabinet Committee decided that financing discussion on ML-1 project should be commenced with China to finalise the mode and PC-1 of the project, according to a handout issued by the Planning Ministry after the meeting.

Khurso Bakhtiar reiterated that the ML-I is a very important project under CPEC portfolio and the incumbent government is committed to fast track it. The ML-I project is facing delay of at least 4 years.

The Planning Commission proposed third party cost validation despite the independent consultants have already conducted the feasibility and design study of the project.

The meeting was also informed that the government will promulgate a Presidential Ordinance to setup the CPEC Authority. The authority’s idea was conceived by the military few years ago but it remained unimplemented.

CPEC is now entering next phase with incorporation of new additional areas and for this purpose there is a need for an integrated entity in the form of the CPEC Authority, stated the Planning Ministry. It was decided that draft act of the authority be presented to federal cabinet for approval.

The committee also decided to present land use plan for Gwadar Smart Port city to the federal cabinet after incorporating recommendations of the Balochistan government.

The meeting was informed that there was also lack of complete consensus between the government ministries over the issue of incentive package for Special Economic Zones being setup under CPEC.

The development agreement for Rashakai SEZ was being delayed due to lack of provision of electricity and disagreement on tax concessions.

Bakhtiar emphasized that all stakeholders should resolve all pending issues pertaining to CPEC projects at the earliest to accrue maximum benefits from the forthcoming Joint Cooperation Committee.

Separately, Bakhtiar also held a meeting to discuss new initiatives of Ministry of Education and the Higher Education Commission (HEC) for promoting quality education across the country. He said effective use of modern technology would help resolve current challenges facing the country.

During the meeting, projects under the HEC came under discussion. Planning minister assured cooperation in timely completion of projects pertaining to Ministry of Education and the HEC.

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