The M-12 Sialkot-Kharian Motorway project has encountered a dramatic cost escalation, rising from an initial estimate of Rs 22.5 billion in 2021 to Rs 71 billion by December 2024.
National Highway Authority (NHA) officials attribute this sixfold increase to compounding challenges, including protracted land acquisition delays triggered by a hydraulic study for the Chenab River bridge realignment, unprecedented inflationary pressures, and soaring interest rates under the Karachi Interbank Offered Rate (KIBOR).
During a high-level meeting chaired by Prime Minister Shehbaz Sharif, NHA leadership confirmed that design modifications, specifically the shift from four to six lanes, further amplified costs. A December 2024 traffic study projected the need for two additional lanes by 2027, prompting the government to approve immediate six-lane construction. While adding Rs9.5 billion upfront, this decision aims to save Rs11 billion compared to phased expansion.
To address these challenges, the Special Investment Facilitation Council (SIFC) fast-tracked revisions to the public-private partnership (PPP) agreement with Frontier Works Organization (FWO), setting a total project cost of Rs81.97 billion. The Ministry of Communications and NHA must submit revised plans to the Central Development Working Party (CDWP) and Ecnec by April 10, 2025, with finalized PPP amendments due April 30, 2025.
Concurrently, NHA has prioritized the Karachi-Quetta-Chaman highway under a three-year completion timeline, emphasizing the need for integrated infrastructure planning. The authority will also implement service areas along key routes to enhance commuter safety, reflecting lessons learned from the M-12 delays.
