ISLAMABAD:The Executive Committee of the National Economic Council (Ecnec) on Wednesday granted approval of Karachi Circular Railway (KCR) project with a four-time revised cost of Rs201.5 billion under the Public-Private Partnership (PPP).
The Federal Minister for Finance and Revenues, Shaukat Tarin, chaired the Executive Committee of the National Economic Council meeting here on Wednesday. The Ministry of Planning, Development and Special Initiatives submitted another summary on development, operation and maintenance of Karachi Circular Railway as a modern urban railway under the Public Private Partnership mode with a total cost of over Rs201.5 billion
The project envisages construction of a 43.225 kms dual track urban mass transit system to be built in three years. The Karachi Circular Railway's Management Company (KCRMC) will keep an oversight related to the execution, operation and maintenance of the project. The ENEC approved the project after detailed discussion. A committee was also formed under the chairmanship of finance minister to review the transaction structure related to the federal government VGF (Viability Gap Fund) contribution.
The KCR is one of the classic projects known for time and cost overrun for several times in the last two decades as it was approved at the cost of a few billion rupees. Then this project was handed over to Japan’s JICA, who abandoned it after seeking guaranteed revenues of millions of rupees on a daily basis without any political influence. But the government could not provide such guarantees and Japan preferred to quit. With the intervention of the Supreme Court of Pakistan, now the right of way has been cleared, which was one of the major stumbling blocks in the way of construction of much-awaited KCR.
