4,000 CNG buses programme in doldrums
03 September, 2012
KARACHI: Government pledges to eradicate transportation woes in Karachi by introducing 4,000 CNG buses long ago could not be materialised as major stake holder of the project, National Bank of Pakistan (NBP) is still unwilling to finance it after the Karachi Metropolitan Corporation (KMC) refused fulfilling requirements.
The project conceived by federal government named 'Shaheed Benazir CNG Bus project' could still not make any headway as KMC is apparently unable to meet requirements of the NBP, the major financer of the project.
The bank that would finance 80% for the project had asked the KMC for collateral, which is the facilitator of the project, while remaining 20% will be financed by the private operators. Under the project, a total of 8,000 buses were expected to ply on the roads countrywide with 4,000 of them in Karachi alone in the next five years from 2009.
It was also decided that in the first phase, 500 CNG buses would be introduced in the provincial capital by the end of 2011, but the plan could not be materialised as KMC is not in a position to fulfill conditions required by NBP.
According to an official in Karachi Mass Transit Cell, the government had already provided subsidy of Rs 0.7 million on procurement of per CNG bus in its fleet of total 4,000 buses. The federal and provincial governments have approved the project, but the problem exists with NBP, who had to provide 80 percent of the total loan for the project, which was now asking for collateral.
The official said that the KMC role in the project should not be misconstrued as it was only a facilitator, while the financers, i.e. government agency (bank) and a private contractor were two major stakeholders.
Director General, Karachi Mass Transit Cell, Rasheed Mughal had raised the issue with Sindh Transport Minister Akhtar Jadoon in a meeting in April this year and requested Sindh government's indulgence to resolve the issue of funding by NBP.
According to a preliminary study conducted by Mass Transit Cell Department for CNG-bus project, it estimates that around 12,399 buses (mostly old buses) of different sizes and shapes ply in Karachi on around 267 routes which overlap considerably with each other.