ISLAMABAD: The management of the Asian Development Bank (ADB) has approved a loan of $9.7 million for Pakistan to help finance the designing of the Karachi Bus Rapid Transit Project, it was learnt here.

The government has already approved PC-II for counterpart financing, and at the request and on behalf of the Sindh government, the ADB has conducted the consultants’ selection process, including engineering, procurement and construction management; operational design and business model; and project management, coordination and capacity building.

The ADB has communicated the results to the provincial Transport and Mass Transit Department which is ready to sign the contracts upon effectiveness of the project development advance agreement, to be signed between the ADB and the federal government, which will contribute $2.28m to cover taxes and duties.

Once the Sindh Mass Transit Authority is established, staffed, and operational, it will replace the Transport and Mass Transit Department as the implementing agency, upon the prior approval of the ADB.

The project is estimated to cost $220m. The project design advance and the ensuing project loan are listed in the country operations business plan 2016–18 for Pakistan and are proposed to be financed from the ordinary capital resources of the Asian Development Bank, with an indicative financing of $10m for the project design advance and $100m for the project loan.

The project follows priorities set in the country partnership strategy 2015–19 for Pakistan, including improving connectivity and access, especially for the poor, by promoting urban public transport systems; and reducing pollution through mass transit systems.

The proposed Karachi Bus Rapid Transit Project will help develop a sustainable urban transport system in Karachi through the delivery of an integrated bus rapid transit (BRT) corridor. The project outcome will be improved public transport in Karachi, benefiting a population of one million.

The project will consist of two interlinked outputs: full restructuring of the Red Line BRT corridor, and effective project management and sustainable BRT operations through institutional and organisational developments.

The project is economically justified by major time savings for future BRT passengers, vehicle operating cost savings, better air quality, and savings in carbon emissions, which will in turn help improve the health of Karachi’s citizens and mitigate climate change. The project will also help make Karachi more liveable and safe, boost private sector investment, and foster gender equity.

The Japanese International Cooperation Agency provided assistance to the Sindh government to jointly develop the detailed and comprehensive Karachi Transportation Improvement Project, comprising a Transport Master Plan and Feasibility Study for the Green and Red BRT lines.

In parallel, the government is currently experimenting a full public-private partnership model to implement the Yellow BRT line. The project will build on these initiatives, following a mixed model combining standard public financing for the main infrastructure, and public-private partnership schemes for bankable components. A stand-alone project loan is proposed as the financing modality since the project focuses on a single BRT corridor.

Published in Dawn, October 9th, 2016