Two-billion-rupee subsidy announced for city’s transporters

CM Murad told new vehicles to alleviate shortage of buses to some extent

Sindh’s chief minister has decided to provide a two-billion-rupee subsidy to Karachi’s transporters to ply 600 more vehicles in the city to meet the growing requirement of passenger buses.

Syed Murad Ali Shah made the announcement at the CM House on Wednesday during a meeting on intra-city and intercity bus services.

Transport Minister Syed Nasir Shah said that there was a shortage of 8,000 buses in the city and so a new mechanism would be adopted to include at least 600 new vehicles to meet the requirement to some extent.

He added that launching the under-construction bus rapid transit network would also help alleviate the transport issues.

The chief executive said his government would assist the private transporters in the form of a subsidy for a period of five years.

“The government subsidy of Rs2 billion will be placed with the Sindh Modaraba Management Limited (SMML) before the publication of the advertisement,” he said, adding that the debt-to-equity ratio would be 70:30. “The transporters’ equity would be 15 per cent and the remaining 15 per cent would be provided by the provincial government in the shape of interest-free loan, which needs to be repaid by the transporters to the SMML within a year.”

CM Shah said the government would provide 30 per cent credit risk guarantee for the outstanding principal loan amount, excluding the Sindh government equity. The transport department also proposed starting an intercity project under the same mechanism as the one proposed for intra-city travel.

Under the proposal, the provincial government would bear the cost of insurance of the vehicle, which would be insured through Sindh Insurance Ltd, and it would be around 5 per cent of the value of the vehicle. The chief executive said that only locally assembled vehicles would be financed.

It was also proposed that if a transporter manages to repay all instalments on time, maintained the vehicle in roadworthy condition and fulfilled all obligations, the Sindh government would not claim its 15 per cent portion.

Giving a presentation on the Blue Line busway of the Karachi Metrobus project, Transport Minister Shah said the scheme would start from Al-Asif Square of Sohrab Goth and end at Golimar.

“It would be a 12-kilometre-long route with a 6.6km elevated portion, and would have nine stations: five elevated and three at grade level. It would be able to accommodate 375,000 passengers on a daily basis.”

Transport Secretary Taha Farooqui said the route would start from Al-Asif Square via Yousuf Plaza and cover Naseerabad, Ayesha Manzil, Karimabad, Liaquatabad Dak Khana, Teen Hatti and Guru Mandir.

CM Shah directed the transport department to go ahead and fulfil all the requirements for launching the projects as soon as possible, saying that the government would assist the transporters financially and administratively.

The meeting was also attended by Chief Secretary Rizwan Memon, CM’s Principal Secretary Naveed Kamran Baloch, Finance Secretary Hassan Naqvi and others.