PPP challenges federal role in Rs465b Punjab project

Warns financing of Lahore-Bahawalnagar motorway could divert funds from nationally strategic schemes

ISLAMABAD:

The Speaker of the National Assembly on Tuesday referred the controversy over the federal government's decision to fund a Rs465 billion motorway project in Punjab to a parliamentary committee, after the Pakistan Peoples Party (PPP) raised objections to financing the scheme from federal coffers.

Senior PPP leader and former finance minister Syed Naveed Qamar submitted a calling attention notice on the matter of "urgent public importance regarding the federal takeover of the Rs465 billion Lahore-Bahawalnagar motorway project". Qamar said the government's decision to divert resources from nationally strategic projects was causing grave concern among the public.

Speaker of the National Assembly Sardar Ayaz Sadiq referred the matter to the National Assembly Standing Committee on Planning for further discussion, following Qamar's recommendation. It was the second consecutive day that the ruling party faced pressure in the assembly. A day earlier, the PPP had also protested the government's "unconstitutional" move to promulgate a presidential ordinance without the assent of the President of Pakistan.

The Express Tribune reported last week that the federal government had conditionally recommended the Rs465 billion provincial project for approval in violation of the National Fiscal Pact and instructions of the Prime Minister's Office, and without securing funding or finalising the design.

Official documents reveal that the cost is Rs201 billion, or 76%, higher than the original estimate approved two years ago, and that the road project "jeopardises the viability, need and upgradation of the Mainline-I project" under the China–Pakistan Economic Corridor.

According to official records, the project was conditionally cleared in breach of the National Fiscal Pact, which bars federal financing of provincial projects, and contrary to PM Sharif's instructions to secure at least 50% funding from the Punjab government. However, Minister of State for Planning Irmaghan Subhani told the National Assembly that the federal government would not fund the project and that financing would be arranged under the public-private partnership (PPP) mode.

His statement contradicted the proposal submitted by the Ministry of Communications to the Central Development Working Party (CDWP).

Despite being a provincial scheme, documents showed that "the project is proposed to be financed through the PSDP" and would be completed over five years. Subhani said the Sukkur-Hyderabad Motorway was the government's priority project. The PPP, however, expressed concern that funding for Sukkur-Hyderabad could be diverted to the Punjab scheme.

Pakistan's south-north motorway connectivity remains incomplete due to the missing Hyderabad-Sukkur link, while Punjab already has an extensive motorway network, much of it funded by the federal government.

Sources said senior PPP leadership was not satisfied with the government's explanation and termed it an "eyewash".

Qamar said International Monetary Fund (IMF) conditions were being ignored to fund a provincial project, while Dr Sharmila Faruqui said the Lahore-Bahawalnagar Motorway was entirely a provincial scheme.

Subhani countered that only 18.5 kilometres of the 295-kilometre project would be funded through the PSDP.

"The state of trust in the government is such that they issue an ordinance one day without signatures," said Agha Rafiullah, a co-signatory of the notice, questioning the credibility of the government's assurances. He urged the government to fulfil the PM's commitments regarding the Sukkur-Hyderabad Motorway. Sadiq said the PM attached great importance to the Sukkur-Hyderabad project.

Planning Commission observations noted that implementation of the Lahore-Bahawalnagar project could undermine the viability, need and upgradation of the ML-I project, an aspect that should be considered by the CDWP.

The observations revealed that the revised PC-I, with a total cost of Rs465.1 billion, was based on the Composite Schedule of Rates (CSR) 2024, while the National Highway Authority (NHA) had already prepared CSR 2025 at a lower cost, requiring rationalisation of the project estimate. The National Assembly was informed that the CDWP had recommended only the previously approved 18.5-kilometre section from the Lahore Ring Road for consideration by ECNEC. For the remaining 276.5 kilometres, the CDWP directed that comprehensive technical feasibility and economic viability studies be conducted.

The Planning Ministry said the CDWP had also instructed the Ministry of Communications to explore alternative financing options due to constraints under the PSDP, to ensure that funding for other priority projects including, the Sukkur-Hyderabad Motorway, realignment of the Karakoram Highway, dualisation of N-55, Lowari Tunnel works, the Khyber-Pakhtunkhwa Economic Corridor, the Pakistan Expressway (Karachi-Chaman Road), and the Hoshab-Khuzdar Road (M-8), was not compromised.

On assurances that the NHA would explore PPP financing and provincial contributions, the CDWP granted only in-principle approval for the remaining project, subject to finalising the alignment in line with the PM's directives and completing technical feasibility studies, the planning ministry said.