KARACHI: The Finance Ministry has approved a grant of Rs10.2 billion rupees for Pakistan Railways, to bail out the public sector enterprise and make it effective again, Express 24/7 reported on Friday.
Sources said the ministry approved the grant after senior government officials intervened.
Four billion rupees will be provided to Pakistan Railways from the Public Sector Development Programme (PSDP) for the maintenance of railway tracks and Rs6.1 billion will be provided through a banking consortium for the repair and maintenance of locomotives.
Earlier, the finance ministry had refused to release the funds until the railways presented a clear plan to spend the money.
Pakistan Railways, the country’s only rail service provider, is passing through one of the worst financial crises in its history. The federal cabinet had approved a Rs25 billion bailout package in December 2010. In June, the finance ministry had promised it would release the funds in July, but has yet to do so.
(Read: The state of Pakistan Railways)
The Railways currently only meets 20% of its operating expenses from its ticket sales and other revenues. It loses approximately Rs36 billion a year.
(Read: The state of Pakistan Railways - II)
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