Lahore Orange Line Train Project (Lahore):
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Financed by: China
Through: The Export-Import Bank of China
Loaned Amount: 1.7 Billion USD (approx)
Payment Arriving time: 5 Years (from China to Pakistan)
Grace Period: 2 Years (First installment after two years)
Total Loan period: 15 Years
Interest Rate: 6%
Type: Concessional Loan (That’s what china says)
Agreement Bonding: Chinese contractors must be used in Project (This means part of china’s loaned money will go back to china)
No other than Pakistani or Chinese contractor is allowed.
Interconnecting Points:
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1) “Earlier, in mid-1990s, the government of Japan had pledged a much softer loan of US $500 million at 0.03% interest rate and payable in 30 years for the Metro System of Lahore, following nearly the same alignment as what is now the Lahore Metro Bus Service. The loan was suspended following nuclear tests by Pakistan. Upon normalisation of political environment, the government of Japan diverted the loan to revamp the once popular Karachi Circular Railway system into a modern Metro System connecting all parts of the city of Karachi. A very soft loan of over $1.4 billion stands committed by Japan. But, the project is struggling since the last over five years largely on account of incompetence of the Sindh government” .. ( So PML N government is doing better job )
2) Orange line is being constructed by many contractors from Pakistan and from china it’s a joint venture of the China Railways (CR) and Norinko. As part of the agreement for the project, Chinese contractors are responsible for construction but they have said that they could subcontract electrical and mechanical works to Pakistani companies. Habib Construction Pakistan is working on Civil works right now.
3) It must be very well understood that this amount is a commercial loan on soft terms dedicated to specific projects largely with Chinese contractors. It is by no means a gift from China to Pakistan as being largely publicized.
4) This project is under construction and is expected to be completed by October 2017
5) The recent anger of Prime Minister on NAB is due to arrest of Orange Line project’s contractor Mr. Amir Latif on charges of fake payments in another project.
6) The Orange Line Metro will run on a 27.1-kilometer track, of which 25.4 kilometers will be elevated. The service will initially benefit around 250,000 passengers a day. The capacity will be increased to 500,000 passengers a day by 2025.
Sources:
http://china.aiddata.org/projects/37280?iframe=y
http://www.brecorder.com/taxation/181/1260181/…
http://defence.pk/…/china-signs-funding-agreement-for-lah…/…
http://www.pakistantoday.com.pk/…/nab-arrest-of-orange-lin…/
https://en.wikipedia.org/wiki/Orange_Line_(Lahore_Metro)
Researcher: Syed M. Shoaib
Syed Muhammad Shoaib 