Lyari Freight Corridor Cost Jumps to $1.085 Billion From $288 Million Estimate

The National Assembly’s Standing Committee on Economic Affairs expressed deep concern on Thursday after learning that the cost of Karachi’s Lyari Elevated Freight Corridor has soared to $1.085 billion, nearly four times its original estimate of $288 million. Chaired by Mirza Ikhtiar Baig, the committee was briefed that the project, spanning 23.5 kilometers along the Lyari Expressway, will now be completed in three phases. The first (9.2 km) will connect the ICI Interchange to M-10, the second (6 km) will link Sohrab Goth to M-9, and the third (13.3 km) will join both sections. Officials said Exim Bank will finance 80 percent of the first phase, while Karachi Port Trust (KPT) will cover the rest. Baig said the sharp increase in cost was “shocking” and announced that the next meeting would be held in Karachi to investigate the escalation. Committee member Javed Hanif Khan emphasized that construction must start without delay, warning that “frequent road accidents in Karachi make this project an urgent necessity.” The committee also reviewed progress on the M-6 Motorway, divided into five sections. The Islamic Development Bank (IsDB) has approved $475 million for sections four and five, while talks continue with the OPEC Fund and the Saudi Fund for Development for joint financing. Bidding for three sections is expected by mid-2025, with construction scheduled to begin soon after. The 306-kilometer project — featuring 15 interchanges and 10 service areas, is expected to be completed by 2028. Chairman Baig voiced alarm over the rising interest rate on project loans, now exceeding 6 percent, calling it “a serious concern.” Officials explained that the terms were standard for IsDB financing, with a 20-year repayment period and a five-year grace period. The committee also discussed the post-flood damage assessment, where officials from the Planning Division reported that 229,000 houses and 22,841 livestock were destroyed across Pakistan during the recent floods. Around 3 million people were rescued in 5,769 operations, and over 20,000 tons of relief goods were distributed. While all relief camps in Sindh have now closed, seven camps remain active in Punjab. Officials said illegal construction along riverbanks had worsened the destruction. “The Prime Minister has already formed a committee to find a permanent solution to encroachments,” they told the panel. Chairman Baig demanded accountability over how housing societies had been issued NOCs near rivers, saying such approvals “must be investigated.” Officials further reported that 1,037 deaths were recorded nationwide during the monsoon and flood seasons. The committee directed relevant ministries to submit detailed follow-up reports at the next meeting, which will be held in Karachi.