By Ijaz Kakakkhel

Driven by a sharp rise in construction prices, the estimated cost of the 295-kilometre Lahore-Sahiwal-Bahawalnagar Motorway has increased by Rs143.12 billion, or about 54%, taking the revised project cost to Rs406.914 billion from the originally approved Rs263.796 billion.

Official project documents available with Wealth Pakistan show that the Executive Committee of the National Economic Council (ECNEC) originally approved the project’s Rs263.795 billion PC-I on July 19, 2023. The revised estimate is based on CSR-2025 rates, reflecting the heightened cost pressures facing the project.

The Central Development Working Party (CDWP), in its meeting on June 24, 2026, recommended the revised PC-I to ECNEC for approval. The revised cost is currently under the approval process.

Despite the sizeable increase in overall estimated expenditure, the Public Sector Development Program (PSDP) 2026-27 has allocated only Rs2 billion for the motorway. The project carries an implementation period of 60 months.

The planned motorway comprises a 220-kilometre, six-lane Lahore-Kassuwal main link connecting with the N-5, along with a 75-kilometre, four-lane Bahawalnagar link. Its total right of way (ROW) is proposed at 100 metres.

Under the revised estimates, the 220-kilometre main corridor will cost around Rs304.337 billion. Package-Ia, covering the first 18.5 kilometres, is estimated at Rs49.025 billion, followed by the 33-kilometre Package-Ib at Rs41.709 billion.

Package-II, spanning 59 kilometres, carries an estimated cost of Rs74.571 billion, while the 58-kilometre Package-III is projected at Rs73.308 billion. The 52-kilometre Package-IV is estimated at Rs65.724 billion.

The 75-kilometre Bahawalnagar link is expected to cost Rs102.577 billion. Its 31.5-kilometre Package-V is estimated at Rs39.967 billion, while Package-VI, extending over 43.5 kilometres, has been assessed at Rs62.609 billion.

The overall revised project value is equivalent to approximately $1.453 billion, based on the exchange rate of Rs280 per US dollar used in the project documents.

The government also plans to adopt different financing arrangements instead of relying entirely on federal development funding. The initial 18.5-kilometre Package-I, Phase-Ia is proposed to be undertaken by the National Highway Authority (NHA) through financing by the government.

Sections considered financially viable would be offered under the Public-Private Partnership (PPP) model, with the NHA arranging its share from its revenues as viability gap funding.

For portions that do not prove commercially viable under PPP arrangements, the Authority would explore financing from international financial institutions or seek federal funding, subject to resource availability.

The project documents have also recommended retaining the originally approved alignment, as its estimated cost remains lower than that of the proposed alternative alignment.

Credit: INP-WealthPk