The government in Pakistan-occupied Kashmir has signed agreements with a Chinese company and a local renewable energy firm for the construction of 700MW hydropower project at an estimated cost of USD 1.35 billion in the region as part of the ambitious China-Pakistan Economic Corridor, a media report said on Wednesday.

China Gezhouba Group and its local partner Laraib Group Pakistan are the shareholders of the 'Azad Pattan Hydropower Project', which is located on Jhelum river in Sadhanoti district of PoK.

The consortium of lenders consists of China Development Bank, China Construction Bank, Industrial and Commercial Bank of China and Bank of China, the paper said.

The implementation agreement and water use charges agreement for construction of the project were signed by PoK Electricity Secretary Zafar Mahmood Khan and Azad Pattan Power Private Limited CEO Li Xiaota on Tuesday, the paper said.

The CPEC, which connects Gwadar Port in Balochistan with China's Xinjiang province, is the flagship project of Chinese President Xi Jinping's ambitious Belt and Road Initiative (BRI). Originally valued at USD 46 billion, the CPEC projects were worth USD 62 billion as of 2017.

India has protested to China over the CPEC as it is being laid through PoK.

The Ministry of External Affairs early this year said that Pakistan was told that the entire Jammu and Kashmir and Ladakh, including areas of Gilgit and Baltistan, are an integral part of India and that Islamabad should immediately vacate the areas under its illegal occupation.

The government of Pakistan implementation agreement, Punjab water use agreement and tripartite power purchase agreements of the project had already been signed in the presence of Prime Minister Imran Khan in July. Tuesday's agreement signing will enable the achievement of financial close of the project.

The project involves no fuel import and will enable the country to move towards cheaper and greener power generation, according to government officials.

The project is expected to create 3,000 jobs. It is expected to provide about 3,266 GWh electricity per year to the national grid by 2027.