Anvwar Asian Investments (AAI), an Oman project finance firm, has volunteered to invest in a train line connecting Gwadar to Pakistan’s major railway system.
Earlier this month, Oman AAI officials met with members of Pakistan’s Board of Investment (BOI) and showed strong interest in establishing a 1,087-kilometer railway line between Gwadar and Jacobabad costing $2.3 billion.
The BOI disclosed that the AAI is willing to give $500 million in first finance right now.
Gwadar’s lack of rail connectivity with the rest of the country might be addressed by the projected multibillion-dollar investment.
However, Pakistan’s fragile political scenario raises question on the feasibility of continuing forward with the plan and realising the port’s potential.
Despite being at the heart of China’s Belt Road Initiative (BRI), the port city lacks rail connections.
Meanwhile, political uncertainty surrounds the likelihood of additional railway enhancements under the China-Pakistan Economic Corridor, which is worth $50 billion (CPEC).
If the railway project is completed by Oman investment, it would improve access to Gwadar and its Chinese-built and managed harbor.
Nasir Sohrabi, President of Gwadar Rural Community Development, emphasized that the port cannot be viable without a good railway network.
“Currently, cargo that is unloaded at Gwadar Port is carried by road to Karachi [and] from there it is exported to other parts of the nation through rail,” he explained, adding that “if this is the case, then it makes more sense to offload goods directly at Karachi Port instead of Gwadar.”
Some saw the Omani group’s plan as a payback for backing CPEC, as China is building in an industrial park in Duqm, Oman’s port town 1,000 kilometres south of the Strait of Hormuz, an essential shipping path.
AAI from Oman is not the only enterprise interested in establishing a railway network in Gwadar. According to the Chairman of the Balochistan Board of Investment and Trade, Saeed Ahmed Sarparah, its competitor is a Singaporean business named Pathfinder.
“A Singaporean business, Pathfinder, has indicated interest in investing $5 billion to create a high-speed rail network from Gwadar to Hub,” he said, adding that the federal government is considering its proposal.