PM orders probe into Thar Coal Railway Connectivity Project cost surge as ECC clears Rs6.61bn funding

Prime Minister Shehbaz Sharif has constituted a high-level committee to review the sharp cost escalation in the Thar Coal Railway Connectivity Project (TCRCP), while the Economic Coordination Committee of the Cabinet has approved Rs6.61 billion in budgetary cover for the mega project, Business Recorder reported, citing official sources.

The committee, headed by Petroleum Minister Ali Pervaiz Malik, includes the Minister for Power, Chairman PMIC, National Coordinator Task Force on Power Lt Gen Zafar Iqbal, Secretary Railways, Managing Director PPIB and CEO Railways.

According to the terms of reference, the panel will examine the revised project cost, financing structure and funding assumptions, and identify reasons for the escalation compared to the originally approved PC-1. It will assess whether the increase resulted from changes in scope, design modifications, timeline revisions or operational inefficiencies.

The committee will also review alterations made to the project scope since the initial approval and evaluate their justification and impact on overall project economics. In addition, it will assess projected tariffs and transportation costs for supplying coal to power plants, and determine whether rail connectivity remains a cost-effective option compared to alternatives.

Meanwhile, the Economic Coordination Committee of the Cabinet has approved a Technical Supplementary Grant of Rs6.61 billion as budgetary cover for the Thar Coal Railway Connectivity Project. 

The funding is intended to support infrastructure development to transport indigenous coal to power plants and industrial users, reducing reliance on imported fuels.