ISLAMABAD — Federal authorities in Pakistan have once again deferred approval for the vital $1 billion Main Line-3 railway rehabilitation project, marking the third postponement in five months amid ongoing financing uncertainties and deliberations over alternative mineral export routes. The Central Development Working Party (CDWP) put off the Rs 278 billion infrastructure initiative during its latest review session, citing the need for clearer parameters regarding funding mechanisms tied to the extraction of copper and gold.
The expansive project encompasses approximately 996 kilometres of railway tracks connecting Nokhandi and Rohri, an essential corridor designed to handle heavy industrial cargo. Existing infrastructure along the route has long exceeded its operational lifespan, restricting train speeds to an average of roughly 30 kilometres per hour. Government planners view a comprehensive overhaul as indispensable before the network can safely accommodate the heavy mineral freight expected from the Reko Diq development.
Planning Minister Ahsan Iqbal stated that the deferral stems from the necessity to acquire more comprehensive details regarding a proposed bridge-financing arrangement with the Reko Diq Mining Company. The government previously endorsed a $390 million bridge loan carrying an annual interest rate of approximately 6%, structured around a single bullet repayment scheduled for June 2028. Financial projections indicate that cumulative repayments could approach nearly $450 million under the agreed terms, provided the core parameters remain unaltered.
However, the viability of the current financial structure faces potential revision as officials weigh altering the designated export corridor. While the original framework anticipated transporting Reko Diq minerals via the Nokhandi-Quetta-Rohri railway link to Karachi Port, policymakers are actively evaluating Gwadar Port as an alternative maritime outlet. Implementing this shift would necessitate full operational readiness along the Nokhandi-Panjgur-Gwadar road connection.
The strategic re-evaluation coincides with a heightened national emphasis on expanding the domestic mining sector, highlighted by recent high-level participation from global mining entities including Barrick Gold, Ivanhoe Atlantic, and Minmetals at the Pakistan Minerals Investment Forum. As Islamabad navigates these logistical and financial adjustments, final approval for the ML-3 undertaking remains contingent upon resolving the interplay between the proposed bridge loan and the ultimate selection of export pathways.