Govt to arrange $390 million bridge financing for Reko Diq rail link

ISLAMABAD: The government is to arrange bridge financing of $ 390 million for railway line from Port Qasim to Reko-Diq Mining Project, Newzshewz has learnt on good authority.
The Reko-Diq Project has been declared as ‘qualified investment’ under the Act of Parliament known as Foreign Investment (Promotion and Protection) Act 2022 and railway track access is crucial for the Reko Diq Project to transport the copper-gold concentrate from the mines in Balochistan for export thus providing a reliable and efficient bulk transport solution for the large volumes of material over the 1350 km route. The rail link is necessary for the Project’s commercial viability by ensuring that the concentrate can be shipped internationally for further processing and sale.
In January 2023, the Ministry of Energy requested Railways Division to survey potential rail connectivity in coordination with the Reko Diq Mining Company (RDMC). Route surveys were conducted and RDMC expressed preference for a rail link via Port Qasim, connecting ML-III and ML-I. Technical assessments by M/s Vecturis and subsequent deliberations through Joint Working Groups of railways (technical, operational, and legal) have shaped the Project’s framework, addressing train design, track access, responsibilities and operations. On June 17, 2025, a Committee under the Minister for Economic Affairs recommended a bridge financing arrangement of $ 390 million for the Reko Diq Project. This arrangement was approved by the Prime Minister on August 8, 2025.
To accommodate the planned movement of Reko Diq Mining Company (RDMC)/ concentrate from the mining site to Karachi Port, the existing Main Line-III (ML-3) railway section from Nokundi to Rohri requires urgent upgradation, as its current condition cannot sustain the projected freight load.
Accordingly, Railways is entering into Rail Development Agreement and Bridge Financing Agreement with Reko Diq Mining Company (RDMC) for the provision of bridge financing amounting to $ 390 million to support the construction and upgradation of his facility. As per the agreed term sheet, the entire principal amount along interest rate of SOFR+250bps.
The Government of Pakistan will act as the guarantor for Main Line-III (ML-3). The financing is being extended for a tenor of three years with accrued interest will be repaid in a bullet payment at the end of the three-year period Both the agreements have been vetted by Law Division and the improvements made by Law Division have been incorporated in both the agreements.
As advised by Law Division, the comment/NOC from Attorney General’s Office has also been obtained. The Foreign Affairs Division has also offered comments with no objection for submitting the summary to the ECC.