ISLAMABAD: The National Highways Authority (NHA) has been in severe financial distress with outstanding loan portfolio of Rs3.2 trillion, which hinders the entity’s ability to invest in operations and upkeep of roads.
This was revealed by Secretary Communications, while briefing the National Assembly Standing on Communications, which met with Aijaz Hussain Jakhrani in the chair, here on Friday.
“The cash development loans (CDLs) reached Rs3.2 trillion including loans and interest,” said the secretary, adding that total throw forward reached Rs2.8 trillion.
The State Bank of Pakistan (SBP)’s annual report 2023-24 noted that NHA accumulated losses reached Rs1.5 trillion since fiscal year 2014. It further stated that NHA often features as one of the highest loss-making entities in the state-owned enterprises (SOEs) space.
Officials also admitted before the committee that projects were being added on recommendations from Presidency, Prime Minister as well as other parliamentarians and number of projects increasing, leaving little resources to complete ongoing projects.
The NHA has currently 105 ongoing projects, however, due to meager allocations, the cost overrun increases and projects could not be completed on time, officials added.
The Ministry of Communications informed the committee that, despite requesting a budget allocation of Rs164 billion last year, only Rs64 billion was allocated. This shortfall is a key factor contributing to the delays in project completion.
The committee reviewed the PSDP schemes for the upcoming financial year 2025-26, in line with Sub-Rules (6) and (7) of Rule 201 of the Rules of Procedure and Conduct of Business, 2007, as directed in two previous meetings. The Ministry of Communications informed the committee that the Ministry of Planning and Development and Special Initiatives had not yet issued the necessary budget call circular to finalise the guidelines for preparing the next year’s PSDP. The Ministry of Communications stated that, once the circular is received, it will be able to submit the proposed schemes to the committee.
The committee expressed its dissatisfaction, as the previous two meetings recommendation had specifically called for the Ministry of Communications to expedite the process and involve the relevant ministries to ensure timely submission, enabling the committee to scrutinise and offer recommendations before the deadline of March 1.
The committee reiterated its instructions for the Ministry of Communications to engage with the Ministry of Planning and Development and Special Initiatives, as well as the Ministry of Finance, to consult with each other and provide an update to the committee within the next day or two. This will allow a follow-up meeting to be scheduled within a week, ensuring that Constitutional requirements are met.
The M-6 Sukkur-Hyderabad project was also discussed.
It was explained that the project is divided into five sections, with a revised total cost of Rs399 billion under a PPP model. Once the PC-1 is approved by ECNEC, bidding for the first phase will begin for Section I (Hyderabad-Tando Adam) and Section II (Tando Adam-Nawabshah). The bidding process is expected to start in April 2025, with the contract award anticipated by October 2025.
The committee was also informed that a Special Steering Committee, chaired by the prime minister of Pakistan and comprising the Minister for Planning, Development and Special Initiatives, the Minister for Communications, and the Minister for Economic Affairs Division, is actively pursuing financing for M-6, M-8, and N-25 projects. The Steering Committee is currently in Baku, Azerbaijan, to secure funding for these priority projects.
Additionally, the secretary informed the committee that the M-6 project is considered one of the most feasible for revenue generation via toll tax, with the project cost expected to be recouped within the first eight years. The Islamic Development Bank has shown interest in financing the M-6 project, with representatives expected to visit for a feasibility assessment next month.
Copyright Business Recorder, 2025
Comments