Pakistan Considers Self-Funding to Fast Track $1.8 Billion CPEC Karakoram Highway
Wire desk byline Sourced from Xinhua, Dawn, Arab News, Anadolu and Minute Mirror. Translated and abridged by the GSRRA Desk.
Pakistan plans to ask China to allow leading local construction companies to participate in the bidding for a $1.8 billion Karakoram Highway project while also considering financing the strategic road from its own resources if further delays occur in securing Chinese funding.
The proposal will be discussed during a Joint Technical Working Group meeting expected later this month in Beijing as both countries seek to accelerate construction of the highway, which is part of the China-Pakistan Economic Corridor (CPEC). Planning Minister Ahsan Iqbal reviewed the project’s progress during a meeting on Tuesday.
Pakistan intends to seek changes to the existing government-to-government framework agreement, which currently limits competition to three Chinese companies. Officials said Islamabad wants top Pakistani contractors to be included in the bidding process for the project.
The new 280-kilometer highway is required because the existing Karakoram Highway will be submerged by May 2028 following the completion of the Diamer Bhasha Dam. The project is estimated to cost Rs. 502 billion, or about $1.8 billion, with the first phase requiring Rs. 320 billion under a joint feasibility study.
Planning Ministry officials said the first phase cost could be reduced by around 35 percent to Rs. 208 billion if the project is executed under local construction standards using National Highway Authority rates and domestic contractors. The ministry has also been directed to prepare updated cost estimates under this option.
Pakistan and China agreed in principle last year that China would finance 85 percent of the project while Pakistan would provide the remaining funding. However, a financing agreement has yet to be finalized. Officials said Pakistan has repeatedly requested China to conclude the financing arrangements, while Beijing has proposed reviewing project costs and related issues during the upcoming technical meeting.
Planning Minister Ahsan Iqbal said he remains hopeful that a financing agreement will be reached during the working group meeting. However, he added that if delays continue, Pakistan may begin construction using its own resources because an alternative route must be completed before the existing highway is submerged.
Reference Link:- https://propakistani.pk/2026/08/05/pakistan-considers-self-funding-to-fast-track-1-8-billion-cpec-karakoram-highway/
Zamir Ahmed Awan is the founder and Chair of the Global Silk Route Research Alliance, a think tank in Islamabad. He studied engineering at Shanghai University in the 1980s, and years later he went back to China as Pakistan's science counsellor in Beijing, from 2010 until 2016, working on science and higher education cooperation between the two countries.…
