Lowari Tunnel cost skyrockets by 261 percent

ISLAMABAD: The sub-committee of the Public Accounts Committee was informed that the cost of Lowari Tunnel projects has increased by 261 percent skyrocketing its revised cost to Rs 46 billion against the initial cost of Rs 7 billion estimated in 2003.

The meeting was held Tuesday, with Syed Naveed Qamar in chair, examining the audit paras related to National Highway Authority (NHA) for 2016-17. It also sought a NAB report on irregularities in the Multan to Sukkur Motorway and set a two-month time frame for it.

During the briefing to the sub-committee, audit officials said the initial cost of the Lowari Tunnel in 2003 was estimated at Rs 7.9 billion which increased to Rs 26 billion in 2010 and now the revised cost is estimated at Rs 46 billion. The audit officials told the committee that the NHA will now give approval of the revised PC-1. Secretary Communication Jawad Rafiq told the sub-committee that initially a railway track was to be first completed before laying roads, but the plan was revised and a decision was taken to construct two lane road first.

Member Public Accounts Committee, Hina Rabbani Khar said the Lowari Tunnel project is of strategic importance as it could link Pakistan with the Central Asian States through Chitral and therefore the project should be seen not from economic point of view but strategically.

Another PAC member, Khawaja Sheraz proposed the para should only be settled if the audit department is satisfied with it. The convener of the PAC's sub-committee, Syed Naveed Qamar directed the NHA to submit the revised PC-1 to the committee.

Examining the audit paras related to Multan to Sukkur Motorway project, Syed Naveed Qamar asked the NHA about the law under which they reduced the size of the motorway which cannot be done without a new tender. The audit officials told the committee the initial cost of PC-1 of the project was Rs 259 billion estimated after a survey by the company constructing the project.

They said the government wrote to the Chinese Embassy who shortlisted three companies. The audit officials said the lowest bid of Rs 406 billion was offered for the project by the company which had devised the PC-1 at a cost of Rs 259 billion.

The NHA renegotiated with the Chinese company after which the contract was awarded for Rs 296 billion to the Chinese firm which both reduced the scope and the quality of the motorway. “The NAB is also conducting an inquiry into the project,” the audit officials said. The convener of the PAC's sub-committee directed the NAB to furnish the report in within two months.

While giving the details of audit objections on the Peshawar northern bypass, the audit officials told the committee that the NHA started this project under political pressure as the NHA did not avail the land for this project. Naveed Qamar express surprise as how the project was started without acquiring the land and why was the contract awarded. The secretary communication said it was not corruption but mismanagement and there should be a change in the policy of acquiring land for the project. At this Hina Rabbani Khar, said there is a direct link between corruption and mismanagement as due to absence of policy to acquire land for the project its cost increased manifold. Naveed Qamar directed the NHA to formulate a policy for acquiring land.

On the Hazara Motorway project, the audit officials told the sub-committee that the NHA does not have the approval for the revised PC-1 to increase the Hazara motorway project from three lane to six lane despite passage of sufficient time. Naveed Qamar observed if such audit paras are ignored by the NHA management it will open doors for corruption. However the committee settled the para on the assurances by the secretary communication that such irregularities would not be ignored.