ML-1 Karachi-Rohri section upgradation: ADB mulling up to USD1.1bn financing

ISLAMABAD: The Asian Development Bank (ADB) is considering up to USD 1. 1 billion in financing for upgrading Pakistan Railways’ Main Line-1 (ML-1) Karachi-Rohri section. The proposed investment is aimed at transforming the country’s key passenger and freight corridor through climate-resilient infrastructure, modern signalling and stronger railway operations. According to the ADB project documents, the proposed “Upgradation of Pakistan Railways Main Line-1 (Karachi-Rohri Section) Project” would comprise USD 1 billion from ordinary capital resources and USD 100 million in concessional ordinary capital resources lending under a multitranche financing facility. READ MORE: ML-1 Railway project: PM, ADB VP discuss early groundbreaking The project, currently at the proposed stage, received concept clearance on June 18, 2026, while fact-finding is scheduled for January 11-22, 2027. The ADB has not yet specified an approval date. The proposed project would cover approximately 480 kilometres of the Karachi-Rohri section, described by the ADB as a core passenger and freight corridor linking the country’s main port with the national railway network. The development lender has identified the deterioration of Pakistan’s railway infrastructure and its underutilisation as major constraints on transport efficiency, logistics competitiveness and sustainable economic growth. The ADB noted that decades of investment skewed towards roads had created a highly imbalanced transport system, with roads carrying the overwhelming majority of passengers and freight. This has contributed to logistics costs of around 15 percent of GDP, while rail—particularly for bulk freight—is considerably cheaper and cleaner but remains underutilised. The proposed investment is therefore expected to support a shift of freight from road to rail while improving passenger mobility, safety and connectivity. The project will focus on climate-resilient and high-capacity railway and port connectivity, alongside modernisation of signalling and railway operations. It will also support improvements in operations, maintenance and asset management and strengthen institutional capacity for sustainable railway operations. The ADB said the project’s intended outcome is to improve railway transport efficiency, safety and sustainability along the Karachi-Rohri section by 2040. The proposed investment comes as Pakistan seeks to address structural weaknesses in its transport sector and improve the competitiveness of its logistics network. The ADB considers upgrading ML-1 critical for improving connectivity, facilitating trade and supporting a more sustainable transport system. However, the lender has stressed that infrastructure investment alone would not be sufficient and would need to be accompanied by deep institutional and financial reforms in Pakistan Railways. The ADB is already supporting the transformation through Project Readiness Financing approved in 2025 and is now considering follow-on multitranche financing coupled with capacity-building and governance reforms. The project also carries a high environmental and social risk classification, reflecting the scale and nature of the proposed railway intervention. The ADB’s applicable safeguards cover environmental and social risk management, labour and working conditions, pollution prevention, health and safety, land acquisition and land-use restrictions, biodiversity, cultural heritage, climate change and stakeholder engagement. The proposed project is also expected to have poverty-reduction and inclusion benefits. According to the ADB, improved railway infrastructure could provide rural communities, informal enterprises, low-income families and vulnerable groups—including women, elderly persons, persons with disabilities and children—with more affordable access to education, healthcare, markets and economic opportunities. The investment is aligned with Pakistan’s broader transport policy objectives, including shifting freight from roads to rail and modernising the country’s core railway infrastructure. The ADB expects the programme to ultimately improve national and regional connectivity, reduce logistics inefficiencies and enhance Pakistan’s economic competitiveness by establishing a faster, safer, more reliable, affordable and environmentally sustainable railway system. The proposed Karachi-Rohri investment thus represents a significant potential expansion of multilateral financing for Pakistan’s railway sector, while placing equal emphasis on physical infrastructure and the institutional reforms required to make the upgraded railway network financially and operationally sustainable. Copyright Business Recorder, 2026

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