Federal govt defers approval of Hyderabad-Sukkur motorway project

The federal government has deferred approval of Rs192 billion worth of Hyderabad-Sukkur motorway project due to proposed changes in its financing model. The project now seeks Rs76 billion from the budget compared to the original plan of constructing the road with private sector funding. The project was initially expected to be completed at a cost of Rs165 billion, which has now increased to Rs191.5 billion.

The Ministry of Communication tabled a new summary for the construction of Hyderabad-Sukkur motorway through a combination of public and private funding, which was not part of the plan the government approved in April last year.

The Rs191.5 billion project is aimed at constructing a 306km road on build, operate and transfer basis under the public-private partnership model. The federal government’s share is now estimated at Rs75.9 billion or 39.6%. Initially, the share of federal government was only 0.7% or Rs1.1 billion.

Land for the project will also be bought by the federal government through a separate project.

The increase in cost from Rs165 billion to Rs192 billion will also dent the government’s claim that it will construct the project at rates lower than the China-Pakistan Economic Corridor (CPEC) project rates.

Source: Express Tribune