A $390 million bridge loan from Reko Diq Mining Company has been proposed to finance Pakistan Railways’ 996-kilometre Main Line-3 project, with the Planning Commission raising concerns over the repayment structure, security costs and post-completion protection of the railway corridor.
The ML-3 project, covering the Rohri-Sibi-Quetta-Koh-i-Taftan section, is estimated to cost around Rs. 278.62 billion and is primarily aimed at supporting transport requirements linked to the Reko Diq copper and gold project.
According to official documents, the federal government plans to arrange interim financing through RDMC and repay the amount in a lump sum by June 2028. The Planning Commission observed that such a bullet repayment could create significant fiscal pressure and increase repayment risks.
While clearing the scheme for consideration by the Executive Committee of the National Economic Council, the Central Development Working Party directed the Ministry of Railways to address a number of concerns before formal approval.
The prime minister has already approved the $390 million bridge financing from RDMC, while the Economic Coordination Committee of the cabinet has also cleared the related rail development and financing agreements. However, only Rs. 250 million has been allocated for the project in the FY2026-27 Public Sector Development Programme.
Pakistan Railways said the project would ultimately be financed through the PSDP, with interim support from RDMC and the federal government. The scheme includes track renewal, rehabilitation of embankments and bridges, replacement of turnouts and construction of 11 new railway stations between Spezand and Taftan.
The project has been divided into two phases. Phase-I, to be carried out from 2026 to 2030, is estimated to cost $585 million and will focus on critical infrastructure works. The remaining works will be completed in Phase-II from 2031 to 2033 at an estimated cost of $145 million.
The Planning Commission also questioned the inclusion of Rs. 46.38 billion in security costs in the total project outlay, noting that security was not a development activity. It asked whether the provincial government had been consulted on the provision of security through local police and sought clarity on how the railway corridor would be protected after completion.
Officials said the ML-3 rehabilitation had become necessary because of the expected rise in mining activity around Reko Diq and the inability of the existing road network to handle large-scale transportation needs.
The current rail infrastructure is in poor condition, with trains operating at restricted speeds of only 10 to 15 kilometres per hour. Passenger traffic on the Quetta-Taftan section has nearly stopped because of deteriorated tracks and safety concerns, while freight movement remains limited.
After rehabilitation, freight traffic is expected to increase significantly, with the line’s capacity projected to rise from two train pairs to 26 and operating speeds expected to reach 100 kilometres per hour. Officials say the project will improve mineral exports, create jobs and strengthen regional connectivity with Iran, Turkiye and onward markets in Europe and Central Asia.
