Chinese firm halts CPEC project over funds issue with Pakistan

A leading Chinese company has drastically slowed down work on USD 2 billion 660kV high-voltage direct current (HVDC) transmission line from Lahore to Matiari, reports ANI.

The work was halted over differences with the government. The Chinese firm has cited the size of revolving fund, delay in building of power plants as main reasons for the slowdown. The 878km Lahore-Matiari transmission line is part of the China-Pakistan Economic Corridor (CPEC). It is also Pakistan’s first project based on direct current (DC).

According to Dawn, the Pakistan Government will not enter into a new agreement under the CPEC with the company until it completes the first line (between Lahore and Matiari).

According to official sources, the sites where the Chinese company has either slowed down work drastically or stopped it altogether are near Balloki, Bhaipheru (about 50km from Lahore), and near Matiari (near Hyderabad).

The project was started in February after the company received a letter of interest from the government.

An official of the power division in the Pakistan Energy Ministry said, “The [Chinese] company has slowed down its work on these two major sites due to three major issues that are yet to be resolved. One issue is related to establishment of a revolving fund and the other to operation and maintenance of the project.”

The Chinese firm has cited the size of revolving fund, delay in building of power plants as main reasons for the slowdown. The 878 km Lahore-Matiari transmission line is part of the CPEC