ISLAMABAD - The Public Private Partnership Authority (P3A) has approved a concession agreement on Friday for construction of the Sialkot-Kharian Motorway project.
A final draft of the agreement was presented before the P3A board for its approval, which would be signed by the National Highway Authority (NHA) with Sialkot Kharian Infrastructure Management (Private) Limited—a subsidiary of the Frontier Works Organisation (FWO).
The board has considered a 258 pages long agreement document and gave its approval. Now NHA would sign it with the concessionaire after fulfilling cordial formalities.
According to the draft agreement available with this scribe, the said motorway would be constructed in twenty-four months from the works commencement date while the motorway would be operated by the FWO for next 25 years.
The total cost of the project is estimated Rs27.32 billion but the construction cost of the project is Rs22.5 billion that includes Rs500 million for the development of National Highway and Motorway Police offices and procurement of vehicles for the police.
According to the agreement, an aggregate amount of Rs6.94 billion would be paid by NHA through the government of Pakistan to the concessionaire as operational viability gap funding in eight equal instalments by credit.
The concessionaire would construct the motorway with its own resources and solely collect revenues for the first ten years of operation; however after that, for next fifteen years, it will share the revenue with NHA on agreed terms and conditions.
The concessionaire would share 5 per cent of the gross revenue with NHA from 11th year of the operation. The concessioner would charge Rs2.37 for cars per kilometre on the motorway with an annual increase of eight per cent.
The concessionaire would construct six interchanges on different locations that includes Jalal Pur Jatan, Pero Shah, Daulat Pur, interchange at the junction between motorway and Link road, Guliana and an interchange on the intersection of link road and N-5—commonly known as G.T road.
The project envisages construction of an approximately 69.3 kilometre long four lane motorway between Sialkot (Sambrial) and Kharian with structures, bridges underpasses, service roads, and flyovers, however, the length of the motorway to be constructed by the concessionaire shall be determined in accordance with the approved detailed design.
According to the agreement, the minimum width of the concession area is one hundred meter. The project includes 20 bridges including a huge bridge on River Chenab along with training, 5 flyover bridges for crossing roads and a rest area on each side of the motorway.
It has been made clear in the agreement that the concessionaire shall not be required to exempt any specific types or group of road users from the payment of tolls except the provincial and national highways and motorway police, fire brigade vehicles, ambulances, armed forces of Pakistan vehicles bearing broad arrow number plates; and vehicles having Supreme Court/High Court Flags/Insignia Plates.
Meanwhile, the agreement also provides that if the NHA would provide supplementary routes then the additional revenue would also be shared with the road authority on a proportionate basis.
NHA had received three bids from construction firms to build the Sialkot-Kharian Motorway. The bids had been submitted as a joint venture of Frontier Works Organisation (FWO) and SMC Private Limited and a joint venture of Matracon Pakistan Private Limited and Techno Private Limited while the Zahir Khan and Brothers (ZKB) Private Limited had also submitted its proposal.
NHA issued a letter of intent to the successful bidder joint venture of Frontier Works Organisation (FWO) and SMC Private Limited on June 8, 2021.