March 15, 2007	Thursday	Safar 25, 1428

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PESHAWAR, March 14: The City District Government Peshawar is unable to make use of an offer for a multi-billion-rupee soft loan extended by a Chinese firm for infrastructure development due to bureaucratic hurdles.

Official sources told Dawn that the city government had signed a Memorandum of Understanding with the Beijing Urban Construction Company (BUCC), a subsidiary of the Chinese government, on Nov 23, 2005, for the construction of fly-overs, underpasses, provision of safe drinking water facility from the Warask Dam, and infrastructure development of Peshawar.

However, no progress has been made on these projects so far, they said, adding that neither the provincial government nor the city government had come forward to implement the projects. In short, the projects had fallen prey to red tape, they said.

Information gathered about the highly-publicised projects revealed that the Chinese firm, after signing an MoU with the city government, submitted pre-feasibility reports of the projects early last year.

Similarly, on March 17, 2006, a detailed briefing was given to Chief Minister Akram Khan Durrani, when a Chinese delegation met him and discussed matters relating to the projects.

The chief minister had approved the three projects in principle and had constituted a committee with District Nazim Haji Ghulam Ali as its head to formulate a final report on the projects, said the sources.

In August the committee finalised its recommendations which were submitted to the provincial government so that the issue could be discussed with the federal government. Since the projects involved an estimated cost of Rs25 billion, the issue was taken up by the Provincial Development Working Party (PDWP), the highest forum at the provincial level, on Nov 25, 2006.

According to sources, the PDWP directed the city government to approach the Provincial Investment Committee (PIC) for clearance of its proposal for financing the projects through the Chinese firm. The finance department was also directed to work out the repayment schedule as proposed on the part of the provincial government.

After obtaining clearance of the PIC, the case was supposed to be forwarded to the federal government for further action, the sources explained. The PIC, being supervised by the industries department, NWFP, took almost four months to clarify that the matter did not fall in its purview.

“The PIC is a body headed by the chief minister, NWFP, to facilitate implementation of investment policies of the government. It does not involve in processing of commercial projects,” explained a letter of the PIC dated March 1, 2007.

According to the sources, the three projects envisage an investment of Rs25 billion, 85 per cent to be provided by the Chinese government and the remaining by the NWFP government. The loan carries soft interest of 3.5 per cent and it will be repayable within 18 years.

When contacted, District Nazim Haji Ghulam Ali explained that the proposed projects had vital importance for the city and could not be implemented without foreign assistance. He claimed that the district administration had completed all the formalities and submitted the same to the provincial government to get clearance from the federal government, which is a prerequisite for acquiring foreign loans.

He cited cumbersome procedures and bureaucratic hurdles as major reasons for delay in the execution of the projects.

However, sources in the provincial government hold the view that delays were made by the district government, and added that it was yet to sign an agreement with the Chinese firm that could provide a basis for the provincial government to take up the matter with the Centre.