LAHORE: China will invest Rs1,000 billion to upgrade Pakistan Railways` infrastructure under a framework agreement signed during the recent visit of a high-level Pakistani delegation to Beijing, said Minister for Railways Khawaja Saad Rafique.

`Work on the project will start by the end of this year,` he said at a news conference here on Thursday.

Under the agreement, he said, Main Line-1 (ML-1) track from Peshawar to Karachi, the PR Walton Academy at Lahore and Havelian Container Terminal would be upgraded.

The ML-1 would have double track with fencing around it in populated areas. Latest automatic signalling system would be installed to ensure accident-free travel at a speed ranging from 120 to 160 kilometres per hour, said Mr Rafique.

`We did not accept Chinese of fer to appoint their consultant for the management and monitoring of the project. We will appoint an impartial consultant through international bidding in a transparent way.

Terming the agreement a breakthrough, he said the investment would be only for the ML-1 upgrade and for five to six years.

The Pakistani delegation persuaded the Chinese authorities toextend long-term loan on favourable conditions. The mark-up might not go beyond 2 per cent rate. It would help transform PR into one of the modern railways in the world.

In reply to a question, the minister said that PR required $30-35bn for its complete transformation. `The PR spends 74pc of its income on pay and pension, 16pc on fuel while only 10.5pc is left for uplift plans,` he explained.

The PR was also working with provinces to develop mass transit systems in provincial capitals.

`Work to restore Karachi Circular Railways is in progress while con-struction of Peshawar Mass Transit Railways is under consideration,` he said.

The minister said that engineers of Pakistan Army had developed a modern signalling system for level crossings.

`PR is thankful to Pakistan Army and its organisation Frontier Works Organisation,` he said.

To another question, the minister said that the PR earned Rs36bn in the previous year and was expecting to earn Rs41bn by June 30 this year.

`The PR income is likely to be more than Rs53bn in the coming years,` he added.