ISLAMABAD: The government has decided that the subsidy on the metro bus service will be shared by the CDA and the Punjab government at the ratio of 60:40.

Earlier, the CDA was reluctant to sign an agreement with the Punjab Metro Bus Authority (PMBA), contending that the share of the subsidy should be 50:50. However, the Punjab government opposed the formula, saying the subsidy should be based on the length of the metro bus track. Out of the 24-kilometre track, 14km is in Islamabad and the remaining 10km in Rawalpindi. Out of the total 24 stations, 14 are located in Islamabad.

“The Prime Minister Office has approved a summary in which the federal government through the CDA will share around 60pc subsidy of the service,” said Qazi Omar, the CDA project director of the metro bus service.

The government is paying Rs2 billion annual subsidy on the metro bus service. Last year, the federal government released Rs375 million to the CDA for sharing the subsidy with the PMBA but in the absence of any agreement it could not be utilised or handed over to the PMBA. Ultimately, the amount lapsed.

According to the initial plan, the federal government wanted to share the subsidy with Punjab at the ratio of 50:50 in the same way both the governments had shared the cost of the Rs45 billion project. However, the provincial government opposed the 50:50 formula and last year Chief Minister Shahbaz Sharif wrote to Prime Minister Nawaz Sharif requesting him to review it.

Published in Dawn, October 3rd, 2016