ISLAMABAD - Development work in Sector D-12 is likely to recommence soon as the Capital Development Authority (CDA) has reached on cost escalation agreement with the contractor. The development work in the sector remains suspended for the last four months due to a row between the city managers and the contractor over cost of the project.  The contractor had demanded 140 per cent increase above NIT rates, which the Authority had turned down, offering 117.5 per cent increase above NIT rates only for the work assigned to the contractor in May 2007. Contract for the development of the sector was given in 2,000 to M/s Ayub and Brothers and the Authority had handed over 50 per cent of the land to the contractor for development. But the development work could only be started by May 2005 due to the dispute between CDA and the villagers over the compensation package. It is pertinent to mention here that it is for the second time that D-12's contractor is demanding escalation of the project cost. Earlier, the Authority had agreed in 2007, while handing over the remaining 50 per cent of land to the contractor, to enhance cost of the remaining development work by 53 per cent.  However, some four months back, the contractor stopped work to pressurize CDA for another 140  per cent increase in the project cost due to the unprecedented hike in prices of steel, cement, oil and bitumen etc during the last year. The contractor was unwilling to accept CDA's offer, however, showed signs of acceptance after receiving a legal notice from the Authority, informed a high official of CDA Directorate of sectors development. He said the matters have been settled with the construction firm and the contractor would soon meet Chairman CDA Kamran Lashari to finalise the agreement and restart the development work. Over 68 per cent of the civil works in the sectors have already been completed, said the official, adding that the remaining development work is likely to be completed by December this year. The sector consisted of a total of 3,445 plots, out of which 2,595 plots have been allotted. Out of the total area of 612 acres, 260 acres have been reserved for residential purposes, 25 acres for educational, 61 acres for recreational and 47 acres have been reserved for commercial purposes. CDA official informed that Rs 250 million have been allocated for paying to Islamabad Electric Supply Company (IESCO) as demand notice for grid station in the sector. A 32 kanal piece of land has been reserved for the grid station, said the official. "Another sum of Rs 50 million has been paid to Sui Northern Gas Pipelines Company Limited (SNGPL) in 2006," he said, adding that the company has pledged to start gas supply to the sector very soon. When contacted on phone, D-12's contractor said that they were willing to accept CDA's offer and immediately start the development work. However, he said, we are requesting the Authority to include hike in prices of diesel in their offer, which he said CDA was not accepting. He said CDA handed them over the land in installments and still 15% of the land was not handed over to them, which he said had resulted in heavy losses for the firm. He said they are all ready to resume work in the sector if CDA meets their demand.