The government has decided to conduct a feasibility study on transmission lines to export electricity to China. This study will involve the Chinese firm Three Gorges.

This decision was made at a meeting chaired by the Minister for Planning, Development and Special Initiatives, Ahsan Iqbal. The purpose of the meeting was to discuss a strategy for finalizing a “wish list” to present to Russia during an upcoming high-level visit to Moscow.

The Minister for Planning recently visited China, where he discussed various bilateral issues with Chinese authorities. Another delegation, including the Finance Minister and Power Minister, also traveled to Beijing to discuss different energy sector and financial matters concerning the country.

The Special Assistant to the Prime Minister (SAPM) on Foreign Affairs, Syed Tariq Fatemi, briefed that the purpose of the meeting is to develop concrete and viable strategies or a roadmap outlining the existing and future plans for a high-level delegation expected to visit Russia soon. He emphasized the need to explore ways to improve the current facility of connectivity and provision of security for convoys through road routes, and suggested that the Ministry of Interior should take necessary measures.

The Secretary of Railways highlighted three important rail routes to connect with Russia and Central Asian countries:

• Upgradation of the Quetta-Taftan Rail network: A Memorandum of Understanding (MoU) was signed on June 7, 2024, and a bilateral meeting is expected by the end of July to operationalize the MoU and identify areas of cooperation.
• Kohat-Kharlachi rail network to connect Central Asian countries through Afghanistan: The feasibility study for this route has been completed.
• MinLink Express (MLE) to connect Riqo Dik to Gwadar, providing a direct and reliable route to the Arabian Sea, which would significantly cut the cost of transporting minerals to markets in Azerbaijan and Russia.

The Minister for Ministry of National Food Security & Research/Industries & Production (MNFS&R/I&P) endorsed the proposal of the SAPM on Foreign Affairs to provide existing and future plans for bilateral negotiations with the Russian side.

The Minister further inquired with the State Bank of Pakistan (SBP) about possible ways to conduct trade and business with Russia. The SBP representative highlighted that there is no issue for banking and other transactions if they do not fall under the sanctions regime. However, the issue arises when any sanctioned entity is involved in the transactions. Banks are cautious to do business with Russian banks due to the sanctions regime and FATF-related compliance issues.

The Minister for Planning indicated that there are several opportunities to enhance exports to Russia. He inquired about the modus operandi being followed by Turkey, BRICS, and other countries while trading with Russia.

The SBP informed that the regional banks of those countries traded in their own currencies. The SBP further suggested that a barter trade mechanism may be explored to enhance bilateral trade with Russia.

The Additional Secretary (Europe) from the Ministry of Foreign Affairs (MoFA) briefed the forum that a report on the mechanism of conducting trade by different countries with Russia has been formulated and will be shared with the Ministry of Petroleum Development & Strategic Initiatives (PD&SI) shortly. He added that tailored solutions are being followed by various countries for trade with Russia.

The Minister for PD&SI emphasized that three sets of documents should be prepared: (i) a G2G (government-to-government) framework/projects, (ii) B2B (business-to-business) cooperation for trade promotion and investment, and (iii) a mechanism for safe trade/business.

The Minister for Petroleum shared with the forum that the visit in December 2022 transformed the bilateral relations, primarily building on energy cooperation.

However, the Minister for Petroleum raised concerns that the cheaper oil facility available from Russia could not be utilized for the benefit of the general public, and only the private sector is earning huge profits. Therefore, the government refineries need to be urged to use Russian oil to benefit the public.

The Minister for PD&SI, while responding to securing funding for mega hydel water projects, expressed serious concerns about the professional working of the Water and Power Development Authority (WAPDA) to explore funding for such projects. The Minister viewed that WAPDA should have developed a consortium of different financiers to meet the funding gap.

The Ministry of Foreign Affairs opined that the proposed delegation to Russia may be dovetailed with the upcoming Inter-Governmental Commission (IGC), likely to be held in September 2024.

The Minister for the Ministry of National Food Security & Research/Industries & Production (MNFS&R/I&P) briefed the forum regarding Pakistan Steel Mills (PSM). The Secretary of the Ministry of Industries & Production informed that the Sindh Investment Facilitation Centre (SIFC) during the Caretaker setup decided to establish an Export Processing Zone (EPZ) on a portion of the Steel Mills’ land.

However, the Secretary stated that the matter will be brought up again before the SIFC for a decision. The Minister for MNFS&R/I&P informed that the Sindh government intends to build a new steel mill on 700 acres and suggested that the Sindh government may be connected with the Russian side.

The Director-General of the Private Power and Infrastructure Board (PPIB), Power Division, suggested that Russia’s experience in working in high-altitude and cold weather can be utilized to lay power evacuation lines from the under-construction hydel power projects.

Read more

Pakistan to get ‘strategic’ rail links with Russia

Pakistan, China to form working group on five new economic corridors

Pakistan, China sign documents on CPEC phase-II

The respective Ministries/Divisions should prepare three sets of documents: G2G (Government-to-Government) Framework/Projects, B2B (Business-to-Business) cooperation for trade promotion and investment, and a Mechanism of safe trade/business.

The Petroleum Division is to develop a comprehensive plan for energy cooperation with Russia.

The Ministry of Railways and the Ministry of Communication/NHA (National Highway Authority) are to develop an integrated multi-modal framework for road and rail connectivity, clearly highlighting the existing routes and gaps with China, Russia, and Central Asia.

The relevant Ministries/Divisions may conduct “warming up” sessions with Russian counterparts to fully prepare for the fruitful outcome during the upcoming Inter-Governmental Commission (IGC) in September 2024.

The Ministry of Water Resources/WAPDA is to explore ways to plug the funding gap of ongoing mega hydel projects through forming a consortium and fetching Russian investment in the sector.