The Pakistan Railways has suffered a loss of no less than rupees two million, as the commercial operator of Karachi Circular Railway (KCR) is reported to have disappeared after failing to honour commitments to the Pakistan Railways.
According to sources, the Pakistan Railways authorities are taking a lenient view of this revenue loss. The railway officials, the sources said, were trying to cover up the matter.
Sources told Business Recorder that, for the first time in the history of railways, the KCR management was handed over to a Lahore-based commercial operator, "Mass Transit Private Limited," under a contract for one-year. Even after the default, the officials are not interested in terminating or suspending the contract because of reported pressure from the Railways Ministry, said the sources.
A much=needed project for city, that was inaugurated in March this year by Prime Minister Shaukat Aziz, fell victim to the non-serious commercial operator of KCR, the source said. They said the company's senior officials, after defaulting in payment of rupees two million due to Pakistan Railways, and Rs 0.7 million to another private company engaged for providing mobile ticketing machine (MTM), went underground.
According to the agreement, the operator was to pay Rs 3.6 million per annum to the Pakistan Railways. Of this amount, the operator was to deposit Rs 900,000 in advance in seven days from the date of execution of the agreement with the Divisional Accounts Officer, Pakistan Railways in Karachi. The balance amount of Rs 2.7 million was to be deposited in 10 equal monthly instalments of Rs 270,000 each, by the fifth of each calendar month, failing which a penalty of Rs 1,000 per day would be imposed, and deposited by the operator within three days from the service of the letter (of notice).
The source said the 'Mass Transit' did not pay its monthly instalments, amounting to Rs 270,000, or the initial advance payment of Rs 900,000. Only after several reminders and pressures from the railways authority, did the 'operator' pay the initial amount of Rs 900,000 to the railways. The sources said now the Pakistan Railway is owed about rupees two million.
Since the operator went underground, the KCR is running by itself, without any supervision either by the Mass Transit or by the railways employees of the operator (Mass Transit), the source said.
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