New Delhi, Jan 19 (IANS): Pakistan has decided to compensate the 36 Chinese nationals, who died and were injured in a terrorist attack last year -- aimed at removing a major irritant in bilateral relations, Express Tribune reported.

A total of 10 Chinese national lost their lives and another 26 were hurt in a suicide attack on a bus that was carrying them to the work site of the Dasu Hydropower Project in July last year.

The Pak government has worked out four different compensation amounts ranging from $4.6 million (Rs 810 million) to $20.3 million (Rs 3.6 billion), sources told The Express Tribune.

Pakistan has decided to make the payment despite there was no legal or contractual obligation on the government, the report said.

The Dasu Hydropower Project is funded by the World Bank and does not fall in the scope of the China Pakistan Economic Corridor (CPEC).

Four Pakistani nationals had also died in the attack.

After the government tried to downplay the terrorist attack as an accident caused by gas leakage, China immediately retaliated and cancelled a scheduled meeting of the Joint Cooperation Committee of the CPEC, the report said.

The Chinese contractor had also stopped the work on the project and demanded a compensation of $37 million.

The compensation that the contractor had claimed was over 500 per cent more than what a Chinese national's heirs would have received if killed in a similar attack in their own country, according to government sources.

The 4,320MW Dasu Hydropower Project is being constructed by China Gezhouba with funding from the World Bank.