In Pakistan, the Karachi City District Government (CDGK) and a group of Chinese companies have signed a preliminary implementation agreement for a 15.2km double-track light rail transit system. The scheme will be split between an 8km elevated section and a 7.2km underground section, each will have seven stations.
It is expected that in the region of 400,000 commuters will benefit from the transit system, which has been budgeted at US$569.39M. CDGK signed the agreement with the China National Machinery and Equipment Group (CNMEG) in the expectation that the track will be laid within four and a half years. Around 90% of the project cost will be arranged from China as suppliers’ credit finance. At US$569.39M plus insurance, commitment and management fee, this equates to US$512.45M to be repaid in 15 years with a three year grace period at an interest rate of 3.5% per annum. The remaining 10% outstanding will be financed by CDGK in US dollars.
Of the seven firms that prequalified for the project, only an American group and CNMEG submitted proposals on 20 January. CNMEG was said to be selected based upon its expertise. After more than two decades of stagnation for mass transit systems for Karachi, the agreement was termed a “milestone”.
