Development & Policy Desk | August 2026 | 5 min read
⚡ Quick Takeaways
- Pakistan is exploring private investment for the Rohri-Multan ML-1 section.
- The section is estimated to cost more than Rs. 450 billion.
- FWO has proposed developing the section through private investment.
- Officials reported 399 derailments and 158 other accidents in 10 years.
- A third-party feasibility study will assess viability and financing options.
| Rs. 450bn+ Estimated section cost |
399 Derailments in 10 years |
$2.5bn Karachi-Rohri phase cost |
Pakistan is exploring private investment options for upgrading the Rohri-Multan section of Main Line-1, with the rail project estimated to cost more than Rs. 450 billion. The move shows how the government is trying to keep the long-delayed railway modernization plan alive after China declined to finance the entire ML-1 package.
Rohri-Multan Section Moves Into Financing Review
Planning Minister Ahsan Iqbal chaired a committee meeting formed on the prime minister’s directions to examine financing options for the Rohri-Multan section. He said the upgradation and modernization of ML-1 remained a key government priority and called for a comprehensive, viable financing strategy.
The meeting reviewed several routes, including the Public Sector Development Programme, foreign financing, public-private partnership models, local commercial bank funding and domestic capital markets. Officials also discussed a Frontier Works Organization proposal to develop the section through private investment.
The estimated cost of the Rohri-Multan section is more than Rs. 450 billion. That number covers the railway section under discussion, while locomotives, cargo stock and passenger coaches may require separate financing assessment.
| Context: The proposal has not been finally approved. The government has ordered independent feasibility work before settling on a workable financing model. |
Why ML-1 Funding Has Become Complicated
ML-1 is Pakistan’s main north-south railway corridor and is central to passenger movement, freight transport and long-distance connectivity. The project has been discussed for years, but full financing has remained difficult because of cost, debt concerns and changing lender priorities.
China’s refusal to finance the full ML-1 project forced Pakistan to split the plan and search for other funding sources. The first phase, from Karachi to Rohri or Sukkur, is now expected to be financed by international creditors, including the Asian Development Bank, at an estimated cost of $2.5 billion.
Civil work on the Karachi-Rohri phase is targeted to begin in January 2027. The government is also exploring co-financing with the World Bank, Asian Infrastructure Investment Bank and Islamic Development Bank. That leaves the Rohri-Multan stretch requiring a separate strategy.
Financing Options Under Review
| Option | How It Could Work | Key Challenge |
| PSDP | Public development budget support | Limited by budget pressure |
| Foreign financing | Loans or co-financing from international lenders | May reduce local funding burden |
| PPP/private investment | Private-sector participation, including FWO proposal | Needs bankable revenue model |
| Local banks | Commercial bank financing | Requires repayment certainty |
| Capital markets | Domestic bond or market-based funding | Needs strong investor confidence |
Poor Track Condition Raises Safety Concerns
The committee was briefed on the poor condition of the railway line and accidents linked to deteriorating infrastructure. Officials said that in the last 10 years, 399 train derailments and 158 other accidents were reported on the section. These figures make the case for urgent modernization stronger than a routine upgrade plan.
Railway deterioration affects more than passenger comfort. Weak track conditions can increase derailment risk, slow train speeds, disrupt freight movement and raise maintenance costs. For businesses, unreliable rail can shift more freight toward roads, increasing highway pressure and transport costs.
A modernized ML-1 could support safer train operations, faster movement and better cargo handling if financing and execution are managed properly. The challenge is that railway projects require large upfront spending, long timelines and clear revenue assumptions before investors feel comfortable.
| Safety signal: The reported accident record gives urgency to the upgrade, but it also raises the bar for technical due diligence and construction quality. |
Private Investment Needs a Bankable Model
Private investment in rail infrastructure is not simple. Investors usually need predictable returns through access charges, freight revenue, government guarantees or other structured mechanisms. If traffic forecasts, tariffs or repayment plans are unclear, private financing can become expensive or difficult to close.
That is why Ahsan Iqbal directed that a credible and independent third party conduct a comprehensive feasibility study. The study is expected to assess technical, financial and economic viability and help develop a workable financing model for the Rohri-Multan section.
The government also needs to decide how the project will fit with the ADB-backed Karachi-Rohri section. A railway corridor works best when connected sections move together. If one phase is upgraded while another remains weak, benefits for speed and safety may be delayed.
| Policy need: A credible feasibility study can help compare public funding, lender support and private investment on realistic cost, revenue and risk assumptions. |
What Happens Next
The next step is the independent feasibility review, followed by a clearer financing plan. Authorities also have to complete preparatory work for the Karachi-Rohri phase so civil work can begin by the January 2027 target.
For Pakistan Railways, the Rohri-Multan decision will test whether the country can use mixed financing for strategic infrastructure. If the model works, it may unlock faster progress on other sections. If it stalls, ML-1 could remain trapped between high costs, limited public funds and uncertain private interest.
For passengers and businesses, the core issue is practical: Pakistan needs a safer, more reliable rail corridor. Without money and a credible execution model, the accident record and poor track condition will remain part of everyday railway risk.
Disclaimer: This article is based on official statements and current reporting available at the time of writing. Final financing, costs, timelines and construction scope may change after feasibility review and lender approvals.
