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November 15, 2019

Orange Line Project: Operation, maintenance contract bidding process by month’s end


November 15, 2019

ISLAMABAD: Pakistan has informed the Chinese side that the bidding process of Operation and Maintenance (O&M) contract for the Orange Line Project would be completed by end of the ongoing month, so hopes have risen that the much-awaited project would now become operational.

Official sources confirmed to The News on Thursday that the Joint Cooperation Committee (JCC) under the China Pakistan Economic Corridor (CPEC) showed satisfaction with the progress of Lahore "Orange Line" project. The Chinese side was apprised that the issues of power supply, water supply and drainage have been resolved to a greater extent.

“The Pakistani side further informed that the bidding process of O&M contract will be completed by Nov 30, 2019”, said the official. The JCC expressed satisfaction with the progress of the “Two Big Projects”. Inauguration of Multan–Sukkur Motorway (M-5) was done on November 05, 2019.

Regarding KKH II, both sides agreed to open the Havellian–Manshera section (39 km) at the earliest possible. The Pakistani side assured that issue related to balance design fee will be resolved shortly and O&M contract will be in place before inauguration.

The JCC expressed satisfaction with the progress of East Bay Expressway. The Chinese side was informed that exemption of sales tax is in process and it will be resolved within 2 months by GPA (Gwadar Port Authority) and GoB (Government of Balochistran). The GPA shall resolve the land issues within the period of 1 month. Further, the inclusion of three bridges has been approved by the ECNEC on Oct 2nd, 2019. The competent authority would convey the approved Variation Order to the contract at the earliest.

The JCC expressed satisfaction with the progress of New Gwadar International Airport Project. The Chinese side appreciated for the support from Pakistani government on the issuance of exemption in tax & duties on import stage and necessary account & certificate of import. Regarding the Balochistan Infrastructure Development Cess (1% BIDC), the Balochistan provincial cabinet has issued an official minute to approve the tax exemption, the official exemption letter from Balochistan Revenue Authority (BRA) will be provided in 1 week.

Meanwhile, with respect to the tax exemption of local equipment, machinery and material procurement as well as the reasonable daily necessities of Chinese staff, the concerned authorities will take up the matter with the FBR for clarification. The Pakistani side agreed to resolve issues of the construction power, water and telecommunication connection but these are still under processing.

The JCC expressed satisfaction with the progress of ML-1 project. The Pakistani side informed that the umbrella PC-1 of the project has been submitted to the Planning Commission and will be approved expeditiously. It was further added that bidding documents are under process and will be finalised by Dec 15th, 2019. The Pakistani side proposed that the project financing may be considered through RMB.

The JCC expressed satisfaction with the completion of the review of the Preliminary Design Phase I for ML-1 and agreed to expedite the preliminary design and review of the remaining sub projects. Both sides agreed that the Pakistani side shall complete the project approval process (PC-1), formulate the bidding documents.

To facilitate ML-1 financing, Pakistani side has established ML-1 Inter-Departmental Financing Committee. The Chinese side agreed to constitute a high-level financing committee for financing negotiation in the near future. It was also agreed that RMB financing for the project shall be considered.

Regarding the three mass transit projects in Karachi, Quetta and Peshawar, both sides agreed to move forward based on the readiness of each project. For Karachi Circular Railway project, the Pakistani side will shortly submit the financing request to the Chinese side. Regarding Quetta Mass Transit and Greater Peshawar Mass Transit, both sides agreed to consider the projects in next JWG meeting after approval of the PC-Is.

Both sides agreed that DI Khan–Zhob highway project will be placed in priority list. The Pakistani side requested Chinese side to consider signing a framework agreement for commencement of this project in 2020 and the Chinese side agreed to have internal consultation and to keep in touch with the Pakistani side on this issue.

Pakistani side proposed to constitute a joint technical working group at G to G level to prepare a proposal for the re-alignment of Thakot – Raikot section of KKH. The Chinese side agreed to consider it in the next JWG meeting.

Both sides agreed to deliberate the projects (i) Gilgit-Shandoor-Chitral (359 km), (ii) Mirpur-Muzaffarabad-Mansehra (MMM) (200 km) and (iii) Nokundi-Mashkel-Panjgur Road (290 km) at the 8th JWG on Transport Infrastructure after approval of the PC-Is.

Both sides were satisfied with the progress of the Five-Year Action Plan for Technical Cooperation on Highway (2018-2022) and agreed to convene the annual meeting between the two executive organizations in Pakistan in the first quarter of 2020. The Pakistani side informed that a concept paper explaining all projects in the Action Plan and their financial implications has been drawn up to be submitted to the Chinese Embassy for the formal application for foreign aid of the Chinese government. The application for Aid/Grant shall be submitted to the Chinese Embassy by the first quarter of 2020 upon approval by related Pakistani authorities.

Both sides agreed to the all-weather opening of KKH at Khunjerab. The Pakistani side informed that it will prepare a proposal for consideration at the next JWG. JCC agreed that new projects will be considered in the next JWG after approval of the PC-Is including Swat Express Way Phase –II and Peshawar DI Khan Motorway.