Work on ‘Revival of Karachi Circular Railway (KCR)’ the much delayed $1.58 billion foreign funded project is likely to start by June 2012. Government has decided to resolve all financial matters by April next year. In a recently held meeting at ministry of finance in Islamabad, which was attended by representatives of Karachi Urban Transport Corporation (KUTC), proponent of KCR project, Sindh Government, and others, issues related to finance, re-lending of funds, resettlement of thousands of project affectees were discussed. According to sources, all major issues related to project have almost been resolved while some technical hindrance in release of funds from government of Japan and others were there to be resolved within next few months.
In the meeting held on 5th November, 2011, it was also agreed as per demand of Japan International Cooperation Agency (JICA) that KUTC would share profit and losses of the project as it was sharing almost 7 per cent of the project. Japan was providing for at least 93 per cent cost of KCR project. During the next few months technical team of JICA would also visit the country to finalise financial matters besides other aspects related to the project.
It is worth mentioning here that for the last 6 years, the project was under various studies. The report was furnished in March 2006 for revival of KCR. Different survey teams of Japan had come to Pakistan and made PC-1 but as cost of project was increased in two years foreign team had made the new study with modified cost. Government of Japan had earlier promised to release $872.316 million STEP loan for the KCR project and it had commissioned a study under the aegis of Japan External Trade Organization (JETRO). In the last six years, studies related to Resettlement Action Plan (RAP), Initial Environment Assessment (IEA) and allocation of land for thousands of affectees have already been finalised and approved by concerned authorities. Japanese government, as a first parameter, would combine KCR‘s 30km loop with modern signaling and telecommunication system.
Under the project which is needed to overcome traffic problems in the country, was planned to make at least two dedicated tracks along with main line from City (Railway) Station to Drig Road Station of 14.5 km, which would later be linked to the airport with distance of 6 km, at a cost of $179.464 million.
It may be recalled that Pakistan Muslim League-Q led Sindh government had winded up local train service in January 2000 and had again decided to revive system after realising its importance in 2004. Later, to mitigate traffic problems in the country’s most congested cities Tokyo had commissioned 100 per cent funding for the project under “STEP Loan” at 0.2 per cent markup rate for a 40 year payback time, including a 10 year grace period.
