China has stopped funding for certain CPEC projects. Those related to road network are specifically halted till new guidelines are issued by China. This is confirmed by a senior government official.
This decision can have a drastic effect on Rs1 trillion worth road projects of the National Highway Authority (NHA). Currently, we don’t know the time frame of delay. This is confirmed that at least three road projects will be delayed because of this decision.
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These road projects are 210-km Dera Ismail Khan-Zhob Road worth Rs81bn, 110-km Khuzdar-Basima Road worth Rs19.76bn and 136-km remaining portion of Karakoram Highway (KKH) from Raikot to Thakot worth Rs8.5bn
Initially, all these projects were part of the government program. In Dec 2016 they were made part of CPEC so that financial assistance could be received from China.
The official said that funds for the three road projects were approved in the 6th JCC meeting held last year, pending necessary procedural formalities.
As per the government official, it was expected that these 3 projects and their funding will be decided in the Joint Working Group (JWG) meeting held on Nov 20. On the other hand, Pakistan was informed that ‘new guidelines’ will be issued from Beijing and then funding will be decided. So the current procedure to release the funds for CPEC projects is going to change.
The official said, “In fact, the Chinese authorities informed us that the previous procedure of release of funds was meant for early harvest projects only and new guidelines will be issued for future projects of the CPEC.”
It means that these new guidelines can affect more projects along with the three mentioned above. Pakistani side was quite stunned by this decision made by China officials. The Pakistani official informed that China is disturbed with reports published regarding corruption in CPEC projects. This is the main reason for temporarily halting funds.