The Chinese national working on the hydropower project has denied the allegations made by his colleagues.
A Pakistani court has ordered the remand in judicial custody of a Chinese national accused of blasphemy for two weeks, police said.
The man, identified only as Mr Tian in the official police complaint, denied the allegations made by his colleague when he appeared in court in the city of Abbottabad on Monday night.
Local police official Tahir Ayub confirmed to Al Jazeera on Wednesday that the accused had been detained while authorities investigated the incident.
Blasphemy is a sensitive topic in Pakistan, a Muslim-majority country where those convicted of crimes can be sentenced to death for certain forms of crime.
The Chinese national, who works as a heavy transport supervisor on a major hydropower project, was accused on April 15 of insulting the Prophet Muhammad by allegedly urging workers to work faster as they rested for prayer.
The Dasu Hydropower Station project in Kohistan, Khyber Pakhtunkhwa Province, northwest Pakistan, was undertaken by China Gezhouba Group Corporation.
The police report into the incident said the man made insulting remarks and gestures, criticizing Allah and Muhammad.
The allegation sparked massive protests from residents, who blocked the Karakoram Highway linking Pakistan to China and demanded the accused’s arrest.
Naseeruddin Khan, a police officer in Dasu, said an investigative team had been formed to find out the facts.
“We are speaking to the interpreter of the accused who made the charges, as well as other protesters,” Khan told Al Jazeera.
He said work on the hydropower project continued without any issues.

The Chinese embassy in Islamabad has yet to comment on the case, but a spokesman for China’s foreign ministry said on Tuesday it was “verifying information”.
“The Chinese government has always required Chinese citizens overseas to abide by the laws and regulations of the host country and respect local customs and customs,” Wang Wenbin told a news conference. “If the incident involves Chinese citizens, our embassy will provide consular protection and assistance within the scope of its duties.”
While Pakistan has never formally executed anyone facing blasphemy charges, many have been lynched by angry individuals and mobs over the years for such charges or for expressing disapproval of tough laws. Since 1990, more than 80 people have been killed in such violence.
In 2021, a Sri Lankan factory manager was beaten to death in Sialkot, central Punjab province, by colleagues who accused him of blasphemy.
In 2011, Salman Taseer, the former governor of the Punjab state, was shot dead by his own security guards for showing support for a woman accused of blasphemy. Three years later, human rights lawyer Rashid Rehman was killed representing a university professor accused of blasphemy.
China is one of Pakistan’s key allies, and the two countries are cooperating on a $60 billion infrastructure project known as the China-Pakistan Economic Corridor.
Attacks against Chinese nationals in Pakistan have risen in recent years, and Beijing has repeatedly asked Pakistani authorities to ensure the safety of its citizens and Chinese facilities in the country.
The Dasu hydropower project itself has faced delays in the past.
At least 13 employees working on the site, including nine Chinese nationals, were killed in a suicide bombing in 2021. The attack halted work on the project for six months.
This month, a fire swept through a storage camp at the site.