OLMT project to face further delay

A civil contractor said that despite repeated requests their payments are being continuously delayed


Imran Adnan April 01, 2019
PHOTO: China Xinhua News

LAHORE: Negligence and ill planning of the city developer and town planners have slapped another setback to the Lahore Orange Line Metro Train (OLMT) Project.

Officials working on the current project disclosed that the project is likely to delay by another quarter due to payment delays and sluggish progress.

Speaking to The Express Tribune, an official working on the country's first metro train project, said that though most development works of the project have been completed, the progress on ongoing works is sluggish for various reasons, like delayed contractors' payment, poor coordination among concerned departments and weak oversight of project developers.

He indicated that the project cost is likely to swell further as the government has recently awarded over a dozen small contracts for drainage and miscellaneous works. According to his estimate, it will increase project cost by Rs3 billion. The original contract of the project was Rs60 billion, of which around 10-15% funds are still available. However, following the issuance of new contracts this cost is likely to increase.

The government has put payment of the original contractors in dispute and withheld a huge sum of their completed works bills. In addition, Chinese contractors working on the project had initially pointed out that they required around three months for testing and commissioning of the metro train, but now they were indicating that it would require around six months.

A civil contractor of the project said that despite repeated requests their payments are being continuously delayed. "We have completed over 95% of development works, including the civil structure of elevated track, stations and underground metro station near General Post Office, but still awaiting payments against bills of the completed works."

As per the direction of the apex court, he said, the civil works of the project will be completed by end of July 2019. But the project will not enter into commercial operations by August or November 2019.

Earlier, the CJP had directed the Punjab government to ensure of payment of all outstanding dues to all contractors working on the projects. He also directed the Punjab Mass-transit Authority (PMA) to look into the matter and make payment to contractors. However, the issue of outstanding payment is yet to be resolved.

The Punjab government has earmarked Rs34.5 billion for transport and mass transit in its provincial budget for remaining eight months of the current fiscal year 2018-19, of which a lion's share of Rs33.6 billion was earmarked for the OLMT project.

Initially, the total cost of the OLMT project was estimated at Rs165 billion, including a soft loan of Rs150 billion through China's Exim Bank. Previous PML-N government had indicated that the government will pool Rs15 billion through local resources. However, owing to litigation, unplanned land acquisition and retendering for remaining works of the OLMT package-2, the local component of the project cost has already been increased by Rs13 billion for which provincial authorities are trying to seek approval for additional cost.

The OLMT project is part of the city metro network and when completed, it will connect Raiwind, Multan Road, Mcleod Road, Lahore Junction Railway Station and the Grand Trunk Road. It will be the first line of the Lahore Metro, which is the country's first mass rapid transit train system.

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