Blasphemy is a hugely sensitive issue in Muslim-majority Pakistan, where even rumours of sacrilegious remarks can incite lynch mobs and deadly violence.
Officials said the engineer at the Dasu hydropower project in northwestern Khyber Pakhtunkhwa province was accused of blasphemy after he highlighted the "slow pace of work" during the holy month of Ramadan, when Muslims fast from dawn to sunset.
"The labourers said they were fasting but denied that work had slowed down, which led to an exchange of heated words" with the supervisor, a police official told AFP on condition of anonymity.
"Later, the labourers accused the engineer of making blasphemous remarks" and around 400 locals gathered to protest, he said.
A written complaint filed with the police identified him only as a heavy transport supervisor by the name of "Mr Tian", and said that his remarks on Saturday "sparked tensions".
"The Chinese national has been taken to a safe place as a precautionary measure," Muhammad Nazir, a police official in Dasu, told AFP.
The Chinese embassy in Islamabad did not respond to a request for comment.
A local administration official in Dasu, around 180 kilometres (110 miles) north of the capital Islamabad, said army and paramilitary troops were deployed "to ensure the safety of the engineers".
The Dasu dam construction contract was awarded to the China Gezhouba Group Company in 2017, and the project is shrouded by tight security.
It is among a number of Chinese firms that have taken on lucrative infrastructure contracts in Pakistan despite the security threats to Chinese nationals.
Blasphemy is punishable by death in Pakistan, though no executions have ever been carried out for the crime.
Nazir said "formal police action" has not yet started against the Chinese national in Dasu "as authorities are trying to solve this issue peacefully".
Another police official said that "local clerics and village elders are negotiating with the workers to solve this issue".
In December 2021, a Sri Lankan factory manager was beaten to death and set ablaze by a mob that accused him of blasphemy in the city of Sialkot in eastern Pakistan.
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