Ministers of information technology and railways have failed to reach an agreement on the laying of optic fibre cable over railway land and payment of fee on the use of right of way (RoW).
The IT minister argued that the monetary benefit being sought by the railways constituted violation of the RoW policy. However, the railways minister countered, saying Pakistan Railways (PR) required new sources of revenue to prop up the organisation as its financial health was deteriorating.
The two ministers were at loggerheads when the Pakistan Railways Optic Fibre Cable Right of Way Policy was tabled before a recent meeting of the cabinet for approval.
During discussions, the IT and telecom minister pointed out that the monetary benefit sought by the railways was contrary to the RoW policy, which was approved in 2020 after extensive consultation with all stakeholders including provinces.
In case railways was allowed RoW charges, he said, it would open the floodgates to demands from other entities as well, which would undermine government’s efforts to achieve the Digital Pakistan vision.
However, the railways minister strongly opposed the contention and highlighted that the financial health of PR was constantly deteriorating and it needed new avenues of revenue generation, otherwise reliance on government subsidies would keep on increasing for its survival.
It was recalled that the Economic Coordination Committee (ECC) had not approved the railway division proposal. Instead, it formed an inter-ministerial committee, headed by the law and justice minister, for coming up with recommendations.
PR has offered a rail network of 7,791 kilometres for laying an optic fibre cable in a joint venture with private-sector investors. The objective is to generate a new revenue stream keeping in view its poor financial health, but it raised concerns among policy circles.
It would open the floodgates to preferential treatment if PR was allowed to offer land for laying the optic fibre cable, said policymakers while expressing fear.
In an ECC meeting, the Ministry of Railways pointed out that PR was offering an excellent opportunity for laying optic fibre cables along its track for digital connectivity across Pakistan.
It said that PR had a network of 7,791 km, which passed through high-density population areas and connected major cities in the four provinces. “Owing to the strategic location of its infrastructure, PR offers an excellent opportunity for laying optic fibre cables,” it emphasised.
With overage assets and hefty pension bills, the ministry contended, PR’s financial health was deteriorating and unless new revenue sources were identified, the reliance on government subsidy would keep on growing.
Railways secretary emphasised that RoW fee on the use of optic fibre cable would offer PR a decent source of earnings.
ECC was told that the government of Pakistan had promulgated Pakistan Telecommunication (Reorganisation Act) 1996, which specified that “the fee payable by a licensee to public authority, for the use of public right of way, would be such reasonable amount as was assessed by the public authority, after taking all relevant factors into consideration”.
Later, the government issued policy directives for the Act titled “Public & Private Right of Way Policy Directives” on October 9, 2020. The policy directives stipulate that the public authority will not treat the grant of permission to licensees for the use of RoW as a means of commercial benefit, imposition of tax or revenue generation.
Under the new policy, RoW land lease charges have been drastically reduced, depriving PR of a potential source of earnings.
Published in The Express Tribune, February 8th, 2023.
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