ISLAMABAD/BEIJING, SEPTEMBER 2025 — Pakistan and China are moving forward with a renewed phase of cooperation under the China-Pakistan Economic Corridor (CPEC), reinforcing their strategic partnership with the launch of Phase 2 and the creation of a financing consortium for one of the region’s most ambitious infrastructure projects.

At the heart of this development is the Main Line-1 (ML-1) railway project, a massive upgrade of the Karachi-Peshawar corridor spanning more than 1,700 kilometers. With an estimated investment of US$7 billion, the line is set to modernize Pakistan’s oldest and busiest railway route, replacing outdated infrastructure with high-capacity, modern systems designed for faster, safer, and more efficient travel.

To support this undertaking, both countries agreed to establish a consortium of financiers that will bring together the Asian Development Bank (ADB), the Asian Infrastructure Investment Bank (AIIB), and other partners alongside direct participation from China and Pakistan. The goal is to secure sustainable, long-term funding and to share project risks, reflecting a broader model of international collaboration under China’s Belt and Road Initiative (BRI).

According to Pakistan’s Planning and Development Minister Ahsan Iqbal, negotiations with the consortium partners are expected to conclude within weeks, paving the way for construction work to begin in the near future. He highlighted that ML-1 is not just a transport project but a backbone for national logistics, which will help reduce costs, boost trade flows, and create new jobs.

Beyond the railway, China has also assured continued financial and technical support for the Karakoram Highway, further strengthening the connectivity between northern Pakistan and western China. This dual focus on rail and road networks underscores CPEC’s evolving role as a driver of regional integration.

The second phase of CPEC, guided by a four-year action plan (2025–2029), is designed to broaden the initiative beyond hard infrastructure. It emphasizes industrial development, digital connectivity, energy cooperation, and people-to-people exchanges. Policymakers from both countries describe it as a step toward building a “China-Pakistan community with a shared future,” fostering not only economic growth but also closer political trust and security cooperation.

While challenges remain — including financing complexities and long-standing political opposition from India, which disputes parts of CPEC’s route — the project continues to be seen by Islamabad and Beijing as a cornerstone of bilateral relations and a symbol of their enduring partnership.

If completed on schedule, the ML-1 project will transform Pakistan’s transport landscape, cutting travel times, easing freight movement, and positioning the country as a more central hub in regional trade networks. For China, it will further solidify BRI’s presence in South Asia, strengthening supply chains and deepening economic linkages across the region.

Source: The Federal