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Japan has agreed to extend soft loan for Karachi Circular Railway (KCR) project after the issuance of two certificates of improving economic indicators by the International Monetary Fund (IMF) in favour of Pakistan, said Railways minister Khwaja Saad Rafique.
"Japan International Co-operation Agency (JICA) had committed to provide soft loan to finance KCR project, however there were too many problems, including encroachment on the Railway land and the resettlement of encroachers," said Railway Minister while briefing the National Assembly Standing Committee on Pakistan Railways which met with Naveed Qamar in the chair here on Tuesday. All the international donor agencies take information about the developing countries for funding projects in these countries from the IMF. The Fund has issued two certificates to Pakistan at the end of two quarters for the improving economic indicators, said Saad Rafique, adding that now JICA has agreed to finance KCR project.
Resettlement of 4,500 registered encroachers was one of the biggest concerns and condition of JICA and the federal government is to initiate a joint venture with Sindh provincial government to compensate the encroachers at Jumma Ghot to initiate KCR within a year. It is not possible to build houses for these encroachers with JICA funds, said Railway minister, adding that Rs 100 million has been proposed in the budget for next fiscal year for the KCR project to conduct the feasibility study with its own resources to avoid restriction of the donor.
Railway minister further said that China has shown interest to invest $4 billion in Pakistan Railway including $3.5 billion on main line from Peshawar to Karachi and $500 million on Hawailia railway project. Pakistan Railways demanded Rs 50 billion under the Public Sector Development Program (PSDP) in the budget for 2014-15 where 80 percent allocation would be utilised for on-going projects while 20 percent allocation would be for new projects.
Director General Operations Ministry of Railways Syed Mazhar Ali Shah briefing the committee said that out of Rs 50 billion Rs 48.97 billion is local and Rs 1.2 billion foreign exchange component. There are 33 ongoing projects with a total cost of Rs 243.76 billion and expected expenditure of these projects up to June 30, 2014 is Rs 93.27 billion while balance funds required for completion of these ongoing projects is Rs 150.49 billion. Further Rs 50 billion would be required for completion of ongoing projects within three years. A major chunk of the budget ie Rs 22.64 billion is proposed for procurement and rehabilitation of locomotives while Rs 9.515 billion for procurement/manufacture of carriage and wagons.
Railway minister said that it is unlikely that the ministry would get the whole amount of Rs 31 billion earmarked for the outgoing fiscal year, which may affect projects in the upcoming year. The government has released Rs 11 billion to Railway in the current year against the allocation of Rs 31 billion under PSDP.
For the procurement of 150 diesel electric locomotives, only Rs 10 million has been demanded in the budget 2014-15 just to keep alive the PC-1 of the project as Railway is not interested in the project as heavy amount in shape of interest would be required to pay on loan of Rs 72 billion from USA Exim bank.
The committee recommended that regular officers taking salaries from projects should be dismissed at all and the government should take these officers on its payroll instead of Railway projects. Railway minister said that it was also a reason behind the delay in completion of projects, as some officers do not want to conclude projects fearing suspension of their salaries. The committee was further informed that 6,440 temporary labors were regularised during last government.
Japan agrees to extend soft loan for KCR, National Assembly body told | Business Recorder
"Japan International Co-operation Agency (JICA) had committed to provide soft loan to finance KCR project, however there were too many problems, including encroachment on the Railway land and the resettlement of encroachers," said Railway Minister while briefing the National Assembly Standing Committee on Pakistan Railways which met with Naveed Qamar in the chair here on Tuesday. All the international donor agencies take information about the developing countries for funding projects in these countries from the IMF. The Fund has issued two certificates to Pakistan at the end of two quarters for the improving economic indicators, said Saad Rafique, adding that now JICA has agreed to finance KCR project.
Resettlement of 4,500 registered encroachers was one of the biggest concerns and condition of JICA and the federal government is to initiate a joint venture with Sindh provincial government to compensate the encroachers at Jumma Ghot to initiate KCR within a year. It is not possible to build houses for these encroachers with JICA funds, said Railway minister, adding that Rs 100 million has been proposed in the budget for next fiscal year for the KCR project to conduct the feasibility study with its own resources to avoid restriction of the donor.
Railway minister further said that China has shown interest to invest $4 billion in Pakistan Railway including $3.5 billion on main line from Peshawar to Karachi and $500 million on Hawailia railway project. Pakistan Railways demanded Rs 50 billion under the Public Sector Development Program (PSDP) in the budget for 2014-15 where 80 percent allocation would be utilised for on-going projects while 20 percent allocation would be for new projects.
Director General Operations Ministry of Railways Syed Mazhar Ali Shah briefing the committee said that out of Rs 50 billion Rs 48.97 billion is local and Rs 1.2 billion foreign exchange component. There are 33 ongoing projects with a total cost of Rs 243.76 billion and expected expenditure of these projects up to June 30, 2014 is Rs 93.27 billion while balance funds required for completion of these ongoing projects is Rs 150.49 billion. Further Rs 50 billion would be required for completion of ongoing projects within three years. A major chunk of the budget ie Rs 22.64 billion is proposed for procurement and rehabilitation of locomotives while Rs 9.515 billion for procurement/manufacture of carriage and wagons.
Railway minister said that it is unlikely that the ministry would get the whole amount of Rs 31 billion earmarked for the outgoing fiscal year, which may affect projects in the upcoming year. The government has released Rs 11 billion to Railway in the current year against the allocation of Rs 31 billion under PSDP.
For the procurement of 150 diesel electric locomotives, only Rs 10 million has been demanded in the budget 2014-15 just to keep alive the PC-1 of the project as Railway is not interested in the project as heavy amount in shape of interest would be required to pay on loan of Rs 72 billion from USA Exim bank.
The committee recommended that regular officers taking salaries from projects should be dismissed at all and the government should take these officers on its payroll instead of Railway projects. Railway minister said that it was also a reason behind the delay in completion of projects, as some officers do not want to conclude projects fearing suspension of their salaries. The committee was further informed that 6,440 temporary labors were regularised during last government.
Japan agrees to extend soft loan for KCR, National Assembly body told | Business Recorder
