Govt to seek extension in BRT loan utilisation period

Published September 16, 2021
A bus crosses BRT’s Chamkani station, Peshawar, during a test run. — Photo by Shahbaz Butt/File
A bus crosses BRT’s Chamkani station, Peshawar, during a test run. — Photo by Shahbaz Butt/File

PESHAWAR: The Khyber Pakhtunkhwa government has planned to approach the Asian Development Bank for one-year extension in the period for the utilisation of the loan obtained for the Peshawar Bus Rapid Transit project.

The provincial cabinet has already approved the Peshawar Development Authority’s request for the ‘loan closure’ extension to complete civil work on two bus depots and other parts of the project.

According to the summary submitted to the cabinet by the transport and mass transit department for the purpose, the ADB had committed $335 million for the project under a loan agreement signed on Sept 12, 2017.

“Section 3.04 of Article III (use of proceeds of loans) states that the [loan] closing date shall be December 31, 2021 or such other as may from time to time be agreed between the borrower and the ADB,” the summary said.

According to the summary, the PDA, the executing agency of the bus project, said project civil work component had been delayed due to the extension of the corridor, revision of the construction drawings, shifting of the utilities, increase in the scope of the work, and contractor fault.

Relief sought from ADB to complete remaining work on bus project

“Subcontractors have also been mobilised for the (completion of the) balance work,” it said, adding that the contractors will take seven to 10 months to complete the work.

The summary said the PDA had also highlighted the fact that the interest rate accrued on the loan amount disbursed/utilised and commitment charges was admissible on an undisbursed amount,wherein loan closing date for the ADB funded component was fourth quarter of 2021.

It added that the PDA, considering the wider benefits and utilisation of the loan proceeds in full, sought one one-year extension in the loan closure date by 12 months i.e. up to Dec 31, 2022.

The summary also said the matter would be taken up with the ADB through the Economic Affairs Division for approval.

When contacted, PDA director general Ammara Khan said since the BRT loan closure deadline was expiring on Dec 2021 and some work was pending, it was imperative to seek extension in the loan utilisation period.

She said the remaining work on the project, which included completion of bus depots in Hayatabad and Dabgri, construction of drains, and carpeting on different parts of the project route, were likely to be completed by May or June next year.

“We will complete that work well before next December,” she said.

She said six to seven per cent work on the project had yet to be completed.

Ms Ammara said the estimated cost of the remaining work was around Rs3 billion.

She said the authority had issued work order for remaining parts of the project to the sub-contractors of the joint ventures that had executed the project.

The PDA chief said the ADB’s rules also allowed awarding the remaining contract to the sub-contractors, who were working to complete the project.

Though the much delayed bus project has been operating since August last year, two major bus depots are still incomplete.

According to TransPeshawar, the operator of the bus service, orders for the project’s remaining 60 buses will be placed after the construction of bus depots.

Published in Dawn, September 16th, 2021

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