The Chinese government and banks will finance Chinese companies to build $45.6 billion worth of energy and infrastructure projects in Pakistan over the next six years, according to new details of the deal seen by Reuters on Friday. China has promised to invest around $33.8 billion in various energy projects and $11.8 billion in infrastructure projects.
Pakistan sees the latest round of Chinese investments as key to its efforts to solve power shortages that have crippled its economy.
Blackouts lasting more than half a day in some areas have sparked violent protests and undermined an economy already beset by high unemployment, widespread poverty, crime and sectarian and insurgent violence.
Under the CPEC agreement, $15.5 billion worth of coal, wind, solar and hydro energy projects will come online by 2017 and add 10,400 megawatts of energy to the national grid, officials said.
An additional 6,120 megawatts will be added to the national grid at a cost of $18.2 billion by 2021.
$622 million of the projects relate to the deepwater, strategically important Gwadar port, which China is developing.
The CPEC deal also includes $5.9 billion for road projects and $3.7 billion for railway projects, all to be developed by 2017. A $44 million optical fiber cable between China and Pakistan is due to be built.
SOURCE – Reuters