The Executive Committee of the National Economic Council (Ecnec) approved the second phase of the Karachi water and sewerage services improvement project on Monday, with a revised cost of $665 million (Rs186 billion). The decision aims to address the growing civic service demands in Karachi, Pakistan’s largest city, which faces severe water shortages and requires substantial upgrades to its sewerage system.
The project, initially approved in 2024 at Rs167 billion, saw a Rs19 billion increase, or 11% rise in cost. The second phase will benefit from $240 million each from the World Bank and the Asian Infrastructure Investment Bank (AIIB), along with a 60-million-euro loan and 3 million euros in grant from the European Investment Bank. The provincial government will contribute $60 million.
This phase is part of a broader $1.6 billion commitment from the World Bank and AIIB to the four-phase project, aimed at improving Karachi’s water supply and sewerage systems by 2032. The first phase is under implementation and is set for completion by June 2026.
Ecnec also approved, in principle, the revised project for the acquisition of land for the Karachi-Lahore motorway, with the cost raised to Rs68.8 billion. The land acquisition covers 25,925 acres required for the 959km stretch of the motorway, part of the priority government project to enhance road connectivity. The initial cost of the land acquisition was set at Rs51 billion in 2014, but costs have increased due to rising land valuation and utility shifts, now amounting to Rs68.8 billion—a 34% increase over the original estimate.
The motorway project will include compensation for landowners, right-of-way arrangements, utility relocations, and the construction of interchanges. The National Highway Authority will oversee the land acquisition, with districts in Sindh and Punjab responsible for acquiring and managing the land.
With these approvals, the government is moving forward on key infrastructure projects aimed at improving Karachi’s civic services and enhancing national road connectivity.
