Pakistan has taken significant steps to bolster its economy and infrastructure. The government has directly awarded a $2 billion contract to China for the construction of a critical road segment under the China-Pakistan Economic Corridor (CPEC). Additionally, a Rs78 billion incentive package has been approved to encourage foreign remittances.
Karakoram Highway Project
The Economic Coordination Committee (ECC) approved a special rule to bypass the usual bidding process for the construction of the Thakot-Raikot section of the Karakoram Highway. This section is crucial for maintaining land connectivity between China and Pakistan.
The Ministry of Communications presented a summary to the ECC regarding the Framework Agreement between China and Pakistan for the realignment of the KKH. The ECC allowed the Ministry and the National Highway Authority (NHA) to proceed with the provisions outlined in the agreement under Rule 5 of the Public Procurement Rules, 2004.
Key Features of the Project
- Project Segment: Thakot-Raikot, part of Karakoram Highway
- Length: 241 kilometers
- Funding: $2 billion loan from China
- EPC Responsibility: Chinese companies
- Equipment Use: Predominantly Chinese
Incentive Package for Foreign Remittances
To bolster foreign exchange reserves, Pakistan introduced a Rs78 billion incentive package for commercial banks and foreign exchange companies. The package includes revisions to the Reimbursement of Telegraphic Transfer (TT) Charges Scheme and the Incentive Scheme for Exchange Companies.
Key Features of the Incentive Package
- Commercial Banks: Rs 68 billion allocated
- Exchange Companies: Rs 10 billion allocated
- TT Incentive: Increased to SAR 30 per $100 transaction
- Exchange Company Incentives: Increased fixed and variable benefits
Additional Measures
To further stabilize foreign exchange reserves, Pakistan has banned the payment of pensions in foreign currency to retired pensioners residing abroad.
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