The federal government has allocated funds for railway modernisation, industrial cooperation, policy research, and academic exchanges under the China-Pakistan Economic Corridor (CPEC) in its Public Sector Development Programme (PSDP) for 2026-27. The allocations are part of Islamabad’s push to move CPEC into a second phase focused on industry, technology, investment, and economic cooperation, after years of emphasis on energy and transport infrastructure.
CPEC 2.0 Funding Breakdown
PSDP sets aside Rs1 billion for “New Initiatives under CPEC 2.0”, reflecting the government’s stated aim to broaden the corridor beyond infrastructure projects. In the transport sector, Rs1.056 billion has been allocated for preliminary design, consultancy services, and technical preparations for the Main Line-1 railway upgradation project and a dry port near Havelian. ML-1, one of CPEC’s largest proposed connectivity projects, has faced repeated delays.
The government also allocated Rs50 million to the China-Pakistan Economic Corridor Support Project at the Ministry of Railways to support planning and implementation of CPEC-related rail projects. For industrial cooperation, Rs30 million has been earmarked for the Project Management Unit of the CPEC Industrial Cooperation Development Project, which is aimed at promoting investment and industrial collaboration between Pakistan and China.
Institutional and Academic Allocations
The Centre of Excellence for CPEC, set up in collaboration with China’s National Development and Reform Commission, will receive Rs200 million, while the CPEC Secretariat has been allocated Rs300 million, according to Gwadar Pro. Another Rs100 million has been allocated for academic collaboration under the CPEC Consortium of Universities, a platform for research, educational, and people-to-people exchanges between the two countries.
Gwadar Development Funding
Separately, the federal government allocated more than Rs14.2 billion for Gwadar-related projects, covering connectivity, infrastructure, maritime development, water supply, education, and municipal services. This significant investment underscores the strategic importance of Gwadar port in the CPEC framework.
