Chinese Investment in Pakistan’s Power Sector Hits $21 Billion

The restoration of a coal-based powerhouse at Gwadar has increased Chinese investment under the China-Pakistan Economic Corridor (CPEC) to $21 billion.

“Now we have restored the 300-MW project on imported coal, which will be made operational by December 2025,” a Power Division official told a national daily.

The government official revealed that the government had earlier almost abandoned the construction of the powerhouse in Gwadar but later it suggested to the Chinese government to shift the power plant to Thar coal. The Chinese government refused and insisted on the restoration of the 300-MW powerhouse based on imported fuel.

“It termed the initiative the most strategic project, as the Gwadar port’s operation cannot be made dependent on any weak project, whose fuel transposition may be vulnerable given the law and order situation in the province and imported electricity from Iran as well,” he explained, adding that now the 300-MW imported coal project has been restored and will be operational by December 2025.

So far, eight projects worth $11.337 billion have already been commissioned and are injecting 7,320 MW of electricity into the national grid via CPEC. Additionally, the mega Matiari-Lahore HVDC transmission line project was completed at a cost of $1.658 billion to transport 4,000 MW from Sindh to Lahore to meet the needs of the Punjab load center.

Five projects worth $6 billion are in the works to generate 4,328 MW of power. The cost of the Thar coal electricity project, which is part of the IGCEP (Indicative Generation Capacity Expansion Plan 2022-31) is unknown. However, if the project’s estimated cost is included, the CPEC power sector lineup is estimated to be worth around $21 billion.

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