SKARDU: The federal government has been asked to start work on strategically important Jaglot-Skardu Road.

Imran Nadeem, a former member of Gilgigt-Baltistan Legislative Assembly, told a group of journalists here on Tuesday that government failed to start even spadework on the scheme despite seeking 85 per cent of project cost from the China Gezhouba Group Company (CGGC).

He said that National Highway Authority had signed a memorandum of understanding with CGGC in 2010 during a visit of President of Pakistan to China. He said that CGGC had agreed to assist its counterpart in procuring 85 per cent of project cost through a Chinese bank.

Mr Nadeem said that in September 2010, NAH had got advertised expression of interest in local media.

After detailed discussion and negotiations, he said, the CGGC had offered engineering procurement and construction-based contract of $457.9 million in January 2012, however, after a series of discussions between both parties, a final price of $396.42 was submitted.

Mr Nadeem said that CGGC sought project funding from Exim Bank of China, while NHA sent a revised PC-1 case, referring the matter to the economic affairs division to apply for the loan. Even after the finalisation of the price the ministry of communication took no action on the vital project, he added.

He claimed that without formal cancelling of the current contract with the CGGC, fresh international bids were invited with revised request for proposal in October 2013.

In response, the CGGC also submitted its bid and also offered funding for the project. He said that CGGC gave a final price of $396.4 million, which included five new bridges.

The CGGC, he said, also entered into a joint venture with the Frontier Works Organisation. He said that Exim Bank of China had earmarked funding three years ago, but NHA authorities were reluctant to execute the project.

He feared that if the project was not executed, CGGC might divert its funds to some other project outside Pakistan.