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PPPs in Pakistan Railways – When and how?

By Hasaan Khawar

President of Pakistan has given his go ahead to release PKR 6 billion for bleeding and crippled Pakistan Railways (PR), for repair of old and purchase of new locomotives. FInancial sustainability of PR has long been under question but recently even the employees have started to bear the brunt of PR’s ill financial health through non-payment of salaries. They have in turn staged protests, which has paralyzed PR’s operations at various places. Govt. has admitted that the long term solution of the situation lies in private sector participation in PR but unfortunately, it’s not something which has recently been discovered. Railways across the world have set examples of successful PPPs in areas like rehabilitation of stations, running private passenger trains, etc. Therefore its not really a question of ‘if’ but its ‘when’, which is becoming critically important. GoP needs to do something concrete and do it soon. What can be done is not really a rocket science. PR needs to have a quick evaluation of PPP opportunities, followed by either detailed feasibilities or rapid appraisals, depending upon the complexity of a particular project. Once the project is prepared, they can quickly be offered in the market, through competitive bidding. My guess is that rehabilitation of railway stations, along with allied property development may be the first ones to attract private investment, but once the credibility of these transactions are established, we can soon witness private sector showing interest in more advanced operations such as running of passenger trains, etc.

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