ISLAMABAD: China’s State Grid Corporation is set to build a $1.5 billion power line across Pakistan to enable the transmission of 4,000 megawatts of electricity from the country’s north to south, the government said on Friday.
Pakistani and Chinese officials signed an investment agreement in Beijing on Thursday to build the country’s first high-voltage, direct current (HVDC) line, according to a government statement. The agreement was signed by Water and Power Secretary Mohammad Younus Dagha and State Grid Corporation of China Chairman Shu Yinbiao.
The high-capacity transmission line will be the first of its kind in Pakistan, and will link the national grid between the southern town of Matiari and easternmost city of Lahore, some 1,000 kilometres apart.
Construction will begin in January, and should take about 20 months, said a spokesperson for the Prime Minister’s Office.
Pakistan has been struggling to provide enough power to its nearly 200 million citizens for years, and Prime Minister Nawaz Sharif has vowed to solve the problem by 2018.
The premier inaugurated Pakistan’s fourth nuclear power plant on Wednesday, a joint collaboration with China that adds 340 megawatts to the national grid as part of the government’s efforts to end a growth-sapping energy deficit.
The energy sector has traditionally struggled to cover the cost of producing electricity, leading the government to divert $2 billion annually as a subsidy, according to a recent report commissioned by the British government.
China is ramping up investment in its South Asian neighbour as part of a $46 billion project unveiled last year that will link its far-western Xinjiang region to Pakistan’s Gwadar Port with a series of infrastructure, power and transport upgrades.
Last week, Pakistan’s main bourse announced that a Chinese consortium was set to acquire a 40 percent stake in the stock exchange in a deal estimated at $84 million.
Shanghai Electric announced in August it would buy a majority stake in the utility that supplies energy to Karachi for $1.7 billion, in the country’s biggest-ever private-sector acquisition.
