close
Thursday March 28, 2024

Lack of inter-provincial and federal coordination: $1 bn concessional loan from AIIB for 3 projects is in jeopardy

By Mehtab Haider
June 15, 2020

ISLAMABAD: One billion dollar guaranteed concessional loan from Asian Infrastructure Investment Bank (AIIB) is being jeopardised due to lack of inter-provincial and federal coordination, The News has learnt.

The AIIB committed $1 billion concessional loan for three important projects including $400 million for Rawalpindi Ring Road (RRR) project connecting twin cities Islamabad and Rawalpindi and two projects for Lahore including Waste Water Treatment and second Urban/Environmental Development Project. The talks with AIIB were done in 2018 but now more than two years have passed and the AIIB may withdraw this loan facility, feared expressed by some relevant officials who knew about the fate of these loans. All relevant official documents available with The News revealed that three projects were in the pipeline but now things were quite unclear where no one exactly knew what would be fate of these three projects.

Now half-baked public private partnership (PPP) without any financial studies isunder consideration that may cause further complications, said one top official who has dealt with this project from scratches. However, Buzdar administration in Punjab is completely clueless and may succumb before the pressures for accepting expansive proposals for executing projects, added the sources.

“The indecisiveness on part of policy makers has been playing havoc with concessionary loan since 2018 and it might result into withdrawal of commitment” top official sources confirmed to The News.

Amid depleting foreign currency reserves as it nosedived by $1.7 billion just in one week period, the Economic Affairs Division (EAD) took up this issue and wrote official letter to Punjab government for deciding the fate of these projects so these cheap available resources could be diverted to any other viable projects. These cheap loan envelop might lapse as AIIB could divert it to any other recipient country, said the official.

Top official sources said that this loan was negotiated with AIIB by the incumbent Deputy Chairman Planning Commission Mohammad Jehanzeb Khan when he was serving as Chairman Punjab Development Board.

Sharing details of one viable project Rawalpindi Ring Road Project having 64.3 kilometer long distance, now Punjab changed the implementation agency and handed over RRR project to Lahore Ring Road Authority which had already experience of construction and operation of Lahore Ring Road. The Project Management Unit (PMU) of the project will operate from the Rawalpindi under the Commissioner Rawalpindi.

The official sources said that the feasibility study and detailed design of the project clearly indicated that it was economically viable project. The study done by consultants showed that the objectives of Rawalpindi Ring Road (RRR) project was ensuring easing of congestion on the twin cities urban transportation system, curtailing travel time and costs for the road users, improving safety for both the road users and vehicles, curtailing vehicle’s maintenance costs for the owners, facilitating speedy travel of freight traffic on the Ring Road and save time for access to the destinations in the North and West.

This RRR project also aimed at prompting Rawalpindi city’s decongestion by identifying potential sites for commercial activities, transport terminals, residential estates, education and heath hubs, recreational parks and sports sites, godown/ ware houses and vegetables/ fruit and grain markets, identify potential sites for industrial zones and production units generating employment and effect economy in costs of repairs/ maintenance of the urban road network by CDA, RDA and civic bodies.

This project ensure continuity with Islamabad Ring Road Master Plan as it terminates at Tarnol, at an offset from proposed Islamabad Ring Road by CDA. This alignment of ring road complements and connects with future ring road plan of CDA. Ensuring better and logical distribution of traffic N-5 section from Tarnol to Sangjani is a bottleneck for traffic and seriously defeats the concept of free flow traffic on a ring road.

The proposed alignment generally avoids urban populations and settlements and navigates on the outskirts of twin cities. The administrative stakeholder do not agreed with the old alignment as NHA and CDA show serious concerns related to dumping traffic on M-2, M-1. Also CDA highlighted lack of connectivity with proposed Islamabad Ring Road. Now NHA and CDA endorsed the proposed alignment. This RRR project connects with China Pakistan Economic Corridor (CPEC) as it provides accessibility to larger land use for economic corridor and better connectivity with CPEC Route (Hakla – DI Khan) road.

When contacted to one federal secretary, he said that the Center asked the province in writing to decide the fate of the loan. This scribe contacted to Punjab’s Finance Minister Hashim Jawan Bakhat for seeking his comments, he replied that he was busy for budget making preparation so he advised this scribe to contact Secretary Planning and Development (P&D) Punjab.

When Secretary Planning & Development Punjab was asked about the fate of $1 billion loan from AIIB, he replied on last Tuesday night that “these are proposed not firm up loan so cannot be termed as commitment. We are in negotiation with AIIB as par our requirements regarding these and other projects. And secondly we have to strike a balance as to how much loan province has to take at a time”, he concluded.