Senate panel questions Rs90 trillion debt, foreign-funded project priorities

The Senate Standing Committee on Economic Affairs on Friday raised concerns over Pakistan’s Rs90 trillion debt and liabilities burden, calling for tighter scrutiny of foreign-funded projects, borrowing and contract awards.

Chairman Saifullah Abro said the country’s debt had risen from around Rs40 trillion in 2022 to approximately Rs90 trillion, while borrowed funds were not always being directed towards the most urgent needs.

The committee reviewed foreign-funded road, flood rehabilitation, and irrigation projects in Khyber Pakhtunkhwa and questioned the criteria used to distribute schemes among districts.

Rubina Khalid said Mardan had received 16 road projects, while only 12 kilometres of roads had been constructed in Dir despite extensive flood damage.

Senator Hidayatullah questioned why nine roads had been built in Peshawar, which was not among the flood-affected districts, and sought details of the project selection process.

Members also raised concerns that donor agencies may have been provided with inaccurate assessments of local priorities.

Officials from the Khyber Pakhtunkhwa Communication and Works Department said most district road projects had been completed, while 63 schemes were nearing completion. The total length of completed and ongoing roads stood at around 488 kilometres.

Kamil Ali Agha said future infrastructure planning should account for climate risks, particularly through improved stormwater drainage systems.

Abro also questioned why construction contracts appeared concentrated among a small number of firms. Officials said other companies had not participated in the bidding process.

The chairman said the limited participation raised doubts over whether open competitive bidding had been fully ensured and directed officials to provide complete details of the Notice Inviting Tender.

During a briefing on the Khyber Pakhtunkhwa road rehabilitation and upgradation project, officials said the agreement with the Asian Development Bank was signed in 2018.

The committee was informed that 249.5 kilometres of roads had been rehabilitated or upgraded, while all 10 schemes under the KP provincial roads project had been completed and opened to traffic.

Officials said water-sector projects worth $387 million were being implemented in Khyber Pakhtunkhwa with Asian Development Bank assistance, while projects worth another $295 million were being carried out with World Bank financing.

The ADB-supported Flood Emergency Rehabilitation Project remains under implementation and is scheduled for completion by June 2027.

The committee also examined alleged interference by the World Bank’s local representative in the Sindh Water and Agriculture Transmission Project.

Abro said the lender could approve or reject financing but project execution remained the responsibility of Pakistani authorities.

Officials informed the committee that the project cost had doubled.

Abro claimed Sindh could save around Rs14 billion by resisting proposed changes and directed the Economic Affairs Division, headed by Ahad Cheema, to engage with the World Bank and ensure that implementation remained under Pakistani institutions.