NHA posts Rs288 billion deficit in FY25, cumulative shortfall reaches Rs2.07 trillion

The National Highway Authority (NHA) recorded a deficit of Rs288.54 billion in FY2024-25, taking its cumulative deficit since inception to Rs2.07 trillion, according to the Auditor-General of Pakistan’s Audit Report 2025-26.

The audit report, which covers FY2023-24 and FY2024-25, said the NHA generated total revenue of Rs 122.02 billion during FY2024-25. Toll income remained its main source of earnings at Rs64.42 billion, or 52.8% of total revenue.

Despite this revenue base, the report said the authority continues to face pressure in maintaining the national road network and repaying Cash Development Loans from its available resources.

The NHA’s assets stood at Rs5.83 trillion, while its total debt burden was recorded at Rs3.75 trillion, including Rs1.40 trillion in mark-up. Long-term loans stood at Rs1,799.313 billion in FY2024-25, making them the authority’s largest long-term liability.

The report said the NHA remained under both short-term and long-term liquidity stress, with its current ratio falling to 0.11 in FY2024-25. Foreign exchange losses for the year stood at Rs2.70 billion, adding further pressure to its finances.

The audit also highlighted financial risks arising from contractor claims, litigation and land compensation cases. Sub judice land acquisition cases involved Rs114.497 billion, while contractor-related cases amounted to Rs254.245 billion. Disputes linked to Right of Way leases carried a potential financial implication of Rs3.419 billion.

According to the audit, weak legal representation and delayed responses to claims led to adverse arbitration awards and increased financial liabilities for the authority.

The report also identified unauthorised spending, saying project expenditures exceeded sanctioned limits without prior approval. It noted delays in the submission of PC-IV and PC-V documents, along with incomplete asset registers, which affected the formal closure and capitalisation of completed projects.

Weak monitoring and the absence of a digitised database also resulted in revenue leakages from tolls, right-of-way, leases and fines, the audit said.

The report said administrative action was not taken against officials responsible for allowing guarantees to expire and making excess payments, which contributed to non-compliance within the authority.

The NHA has continued to post net deficits over the past decade. Its net deficit ratio stood at 236.52 percent in FY2024-25 and 327.93 percent in FY2023-24. Between FY2015-16 and FY2022-23, the ratio ranged from 560.56 percent to 248.16 percent.

The audit noted partial progress in the implementation of Electronic Toll and Traffic Management systems. These systems covered eight motorways and expressways and 14 toll plazas on national highways, aimed at improving transparency, real-time revenue monitoring and commuter movement by shifting from manual toll collection to M-tag.

The report also mentioned the rehabilitation of the Islamabad-Murree Dual Carriageway among the authority’s key achievements.

As a state-owned enterprise, the NHA is required to meet governance, sustainability, revenue collection and infrastructure development obligations, while also addressing pending legal matters, the report said.