The government on Tuesday approved China-funded Karachi Circular Railway (KCR) project at a cost of Rs292.4 billion, which was 44% higher than initial estimate, after it managed to thwart boycott of meeting by the Economist Group, which was protesting against discrimination. Central Development Working Party (CDWP), in its meeting, referred the KCR project to Executive Committee of National Economic Council (Ecnec) for approval. Its cost includes a Chinese loan of Rs263 billion, or $1.1 billion, under China-Pakistan Economic Corridor (CPEC) framework.
Last government of Pakistan Tehreek-e-Insaf (PTI) had approved financing structure of the project based on public-private partnership (PPP) mode. But current coalition government has instead decided to take a Chinese loan of $1.1 billion to implement the project on model of Lahore Orange Metro Line. CDWP meeting was crucial for the federal government and Sindh government, as they were keen to pitch the project to Chinese authorities during this week’s meeting of CPEC Joint Cooperation Committee (JCC). Planning Minister Ahsan Iqbal negotiated with the Economist Group and sought more time for meeting its demand, as the group had threatened to force postponement of CDWP meeting.
The government had failed to fulfill its promise to award 150% executive allowance to officers of the group, as the allowance has only been given to blue-eyed bureaucrats by compromising on principles of fairness and equity. In the budget, Pakistan Administrative Service (PAS) group got the 150% executive allowance, but many other service groups including Foreign Service, Commerce and Trade, Inland Revenue Service and Customs Service were excluded. As a result, serious discrepancies have surfaced in their salaries and people doing less work are now receiving more monetary benefits. Planning minister assured the Economist Group that its reservations would be addressed once Finance Minister Ishaq Dar returned from a foreign trip.
The Economist Group has given a second five-week deadline to the government, although its first deadline of 10 days ended on Monday without yielding any results. KCR scheme, under CPEC framework, will be executed and operated by the government of Sindh through Karachi Urban Transport Corporation. Right of Way of KCR will be handed over to the Sindh government. The project envisages construction of a 44-kilometre-long dedicated track. However, loan repayment plan has not been shared by the Sindh government, since the project is not financially viable and it will only be able to meet its operation and maintenance expenses.
