Sukkur-Hyderabad motorway: Rs191b bid approved

The project would approximately cost Rs191 billion.

APP September 18, 2021
As per the decision, the NHA will ring-fence the cash flow of the M5 motorway (Multan-Sukkur) in an escrow account and make payments out of it to the contractors. PHOTO: FILE


The board of the Public-Private Partnership Authority (P3A) has approved the bid documents of the landmark Sukkur-Hyderabad Motorway project.

The project, agreed to be constructed on Public-Private Partnership (PPP) basis, would approximately cost Rs191 billion ($ 1.23 Billion), according to a statement released on Friday.

Minister for Planning, Development and Special Initiatives Asad Umar presided over the meeting of the board held here. Following the board’s approval of the bid documents, the project will be floated in the market and the bidders would be given adequate time to prepare their proposals.

The board previously approved a commercial feasibility study and revised the transaction structure of the project. The project entails the construction of a 306 km green-field 6-lane access controlled toll road on a Build-Operate-Transfer (BOT) basis.

The project is expected to be completed in 30 months following financial close. The concession period of the project is spread over 25 years.

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The private sector will be given the tolling and other ancillary development rights of the project to cover its life-cycle costs and earn an adequate rate of return on investment.

The Government of Pakistan (GoP) is supporting the financial viability & bankability of the project through the provision of capital and operational Viability Gap Funding (VGF) by committing to provide a maximum of Rs43 billion during the construction period and operational VGF payments spread over the first 7 operational years.

The P3A board also approved the Public-Private Partnership Working Party (P3WP) Regulations, 2021.
Asad Umar and other members of the P3A appreciated the performance and efforts of the P3A team on the occasion.

The minister highlighted that the development of transportation corridors was critical to the government’s development strategy, adding that the Sukkur-Hyderabad Motorway would be a vital section of the North-South connectivity and would also have a far-reaching social and economic impact.

The Deputy Chairman Planning Commission, Secretary Minister for Planning, Development and Special Initiatives, nominee of Secretary Finance Division, Secretary Communications, Member Private Sector Development, Chairman NHA, CEO, P3A and two private members of the Board, Huma Ejaz Zaman and Akbar Ayub Khan attended the meeting.


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