KARACHI, Sept 8: Since the revival plan for the Karachi Circular Railway (KCR) has been shelved, the government is considering awarding the right of way of the KCR to the Inter- Globe TransCar Group, which intends to launch a Magno-Metro train service, Dawn learnt on Sunday.

Well-placed sources in the transport department said the existing 32-kilometre-long tracks of the KCR would become useless after introduction of the magnetic train. The KCR study had proposed further 55.4 kilometres right of way for the additional tracks.

The Inter-Globe TransCar Group has relied on the study of the Karachi Mass Transit Programme and expressed its willingness to use the right of way for the Magno-Metro train service, earlier proposed for the KCR.

The sources observed that after preparation of a feasibility report about the Magno-Metro project and when the foreign company is ready to use the right of way — earlier proposed for the KCR — the land would be utilized for the betterment of the people and could be saved from the clutches of the builder mafia, who have continuously been manoeuvring to grab the precious land.

The Magno-Metro train is an elevated guide way transportation system for passengers and cargo transportation. It functions on the principle of electromagnetic levitation. The system is based on non-contact electromagnetic technology with electromagnets located in the under-frame of the coaches and the ferro-magnetic reaction rail attached to the guide way.

The sources said that City Nazim Naimatullah Khan had signed a memorandum of understanding (MoU) with the Inter-Globe Euro- Arab TransCar (IETC) as party-1, and the Overseas Investors on behalf of Rana Abdul Rauf as party-2. It was agreed to find a build, operate and transfer (BOT) company in Karachi in the name of Magno-Metro Corporation or limited.

According to the MoU, the city government would contribute land as an equity to the Magno-Metro Corporation for the track and in consideration it will be entitled to a percentage on gross receipts as may be mutually agreed. The IETC will bring in international investors under the IETC umbrella participation.

The IETC will take 90 per cent of the net profit and ten per cent will go the overseas investors.

The MoU further reads: “Party 1 (IETC) shall be entitled to have 100 per cent shares in the company. Party 2 (overseas investors) shall not have any share and its share of ten per cent in the profit shall be the working share.”

Envisaging its benefits, the MoU says that the transcar system, which can transport cars, trucks, cargo and passengers, will help relieve traffic congestion and chaos on inter-city highways and city streets. The system works unmanned and has no security problems. It can be set up within 1-2 years with prefabricated parts and can be built in an elevated track, without disturbing normal traffic flow.

The Inter-Globe TransCar will organize, procure, build (by subcontractors), own and operate the routes of the transcar. The transfer to the city government will take place after 30 years (subject to negotiations with the city government about general conditions, but not before 30 years).

The price of transferring will be under fair terms and will be based on the economic value of the system and will refer to the technical status of the system.

The government can demand that the system should be improved up to the newest state of the art, which influences the transfer price. Financing of the complete Magno-TransCar project is the duty of the Inter-Globe.

The fare for the train should be oriented in comparison to other transportation facilities, but should not in any case be more than that of buses and railways.

The sources said the project cost had been estimated at 1.2 billion dollars (Rs70 billion). The investment would be brought by the company without government’s guarantee. Earlier, a foreign-funded light-rail project, which was to be built on corridor-1 (from Sohrab Goth to the Mereweather Tower), had failed as the government could not provide 30 per cent fund as a guarantee.

They said the Magno-Metro would require 500MW electricity and the IETC would install its own plant to generate power in collaboration with the Karachi Shipyard. The power would be generated through wind technology. However, the agreement in this respect is yet to be made.

About the transfer after 30 years, the MoU says that it would be handed over to the government on the basis of economic value of the system at that time. The depreciation would apply on the system, but this point has not been mentioned by the company in its relevant papers.