The Planning Commission (PC) has expressed concern over the unavailability of the identified areas for the Karachi Light Rail Mass Transit System and has directed the Karachi Port Trust (KPT) to redesign their land use plan in collaboration with the City District Government of Karachi (CDGK).

In a recent meeting on the project, the KPT representative told the PC chairman that the area identified for Build, Operate and Transfer (BOT) operations was already in use for bonded cargo, stuffing and de-stuffing and it was not possible to make the land available for BOT operations. The PC chairman expressed concern over the KPT stance and directed that the contractor, the KPT and the CDGK should convene a meeting immediately to resolve the issue.

The Finance Ministry informed the meeting that authorities were working out the modalities for arranging a sovereign guarantee of $121 million to support the Karachi Mass Transit Project. The Railways Ministry said that it had moved a summary to Prime Minister Shaukat Aziz for approval of allocation of land to the contractor. Out of 16.5 acres of land required by the contractor, 2.5 acres of land is under litigation while the remaining 14 acres of land was commercial and worth billions of rupees, the ministry added.

The ministry said that it had sought Aziz’s approval on whether to give the land for the BOT operations or not. The Karachi city nazim said that the land used by the railways was government property and the department did not have the authority to sell the land for commercial use. The PC chairman said that the federal government had already decided that the Railways and Ports and Shipping ministries and the KPT should expedite the process of the transfer of land to the CDGK for the project. He said that if the CDGK’s land use plan envisaged the use of this land for a public purpose, and this was confirmed by the CDGK council, the land could not be used for a commercial purpose and should be handed over to the CDGK for BOT operations.

The Central Board of Revenue (CBR) told the meeting that the financial package submitted by the contractor already catered for duties and taxes and therefore concessions/exemptions for the project was not required. The contractor said that that the company had submitted a revised financial model whereby duties and tax exemptions were required to ensure the viability of the project.

The PC chairman said that the prime minister had decided that the concession model used for independent power producers would be applied to the project.
Source: Daily Times