China is not planning to spend USD 58 billion on rail project connecting Pakistan: The Diplomat

China is not planning to spend USD 58 billion on the construction of the China-Pakistan Railway project, and no feasibility study for this proposed project has been completed or approved, said The Diplomat refuting media reports about the rail connectivity project.

Earlier, China-based South China Morning Post, on April 27, reported that a feasibility study had deemed the China-Pakistan railway, costing USD 58 billion, as “worth it.” The Diplomat publication claimed that the SCMP story is not based on a feasibility study at all, but on a journal article titled “Research on the Investment and Financing Operation Mode of Railway’s Go Global Projects,” which was published in the Chinese Journal of Railway Transport and Economy.

According to The Diplomat, the idea of the railway project was first proposed by former Pakistani President Pervez Musharraf in 2008 to the Chinese leadership. The same was mentioned in another article published in the Chinese journal South Asian Studies Quarterly 2012, a copy of which was seen by this writer.

Musharraf’s original proposal was to construct a railway line from Kashgar to Rawalpindi, where it would join Pakistan’s existing railway network and provide access from western China to the Arabian Sea via Gwadar port.

However, the idea never went beyond the pre-feasibility stage due to the difficult terrain of the China-Pakistan border region and the huge costs involved. As a result, there is still no indication by the Chinese government that they have any plans to consider it for a feasibility study.

There are three main reasons why the proposed railway project is infeasible, as per The Diplomat.

First, the railway would need to pass through the hard terrain of the Karakoram region, crossing plateaus, snow-capped mountains, and rivers, with some sections having an altitude of 4,700 meters. The Karakoram Highway remains closed for four months in winter due to snowfall.

Second, the proposed cost of USD 58 billion is too high to be practical, especially considering that the entire CPEC has a total estimated value of USD 50 billion, out of which only USD 25.4 billion have been spent so far.

Third, CPEC’s existing rail project sets a gloomy precedent. The Main Line 1 (ML-1) project, the largest project of CPEC, aims to upgrade the railway infrastructure in Pakistan from Karachi to Peshawar. The rail project has a value of USD 10 billion – far less than the China-Pakistan railway, although still substantial. Yet ML-1 has not materialized eight years after the inception of CPEC due to disagreements on financing terms and political instability in Pakistan, reported The Diplomat.