Project authorized despite violating the National Fiscal Pact and disobeying the Prime Minister’s instruction for 50% finance from the Punjab government.
The Central Development Working Party (CDWP) has conditionally recommended the Rs465 billion Lahore-Bahawalnagar motorway project for final approval by the National Economic Council’s Executive Committee (Ecnec), despite concerns about its violation of the National Fiscal Pact and Prime Minister’s Office directives.
According to The Express Tribune, the project’s cost has risen by Rs201 billion, a 76% increase from its original estimate two years ago, sparking fears that it may jeopardize the feasibility and development of the Mainline-I project under the China-Pakistan Economic Corridor (CPEC).
According to Tribune sources, the Lahore-Bahawalnagar highway project was approved despite violating the National Fiscal Pact, which limits funding for provincial projects. The project also violates Prime Minister Shehbaz Sharif’s guidelines, which required that at least 50% of the cash come from the Punjab government.
The permission was given without a viable funding plan in place and without finalizing the project’s design, despite proposals from the PM Office and Ecnec for design changes. While it is a provincial program, records show that the project will be funded under the Public Sector Development Programme (PSDP), with a five-year completion timetable.
The Planning Commission’s technical branch cautioned that advancing with this project might jeopardize the profitability and advancement of the Mainline-I (ML-I) project, which is an important component of the China-Pakistan Economic Corridor (CPEC). The panel underlined that the Central Development Working Party (CDWP) must carefully evaluate this problem.
Further investigation revealed that the revised project cost of Rs465.1 billion was based on the Composite Schedule of Rates (CSR) 2024, although the National Highway Authority (NHA) had already developed a lower CSR for 2025, indicating that the project cost should be reconsidered.
The project is divided into two sections: a 220 km six-lane highway from the Lahore Ring route to National Highway N-5 at Kassuwal, and a 75 km four-lane motorway connecting Depalpur to the Michanabad-Bahawalnagar route.
According to sources, at the CDWP meeting, the planning minister expressed many concerns. However, the communications ministry, as the project’s sponsor, requested clearance, ensuring that the cited problems would be handled in due course.
