The newly approved ambitious project of Karachi Circular Railways (KCR) by ECNEC would greatly help in addressing transport problems of Karachiites in the coming years with the soft terms credit facility from Japan Bank of International Cooperation (JBIC).
The Minister Economic at Pakistan Embassy in Japan Iftikhar Babar, who has been the driving force in coordinating with JICA, Ministry of Railways, EAD and Planning Commission since last one year to get this project approved as soon as possible, said that the JBIC would issue a $1600 million loan on 0.2 percent interest rate repayable in 40 years including a grace period of 10 years.
Providing details to APP, Babar informed that when the British tram system in Karachi city became redundant in early 70s, all the traffic pressure was born by the Karachi Circular Railways.
However, due to poor maintenance by Pakistan railways, aging railway hardware, more efficient alternate means of public and private transportation, the importance and utility of KCR dwindled in late 1990s.
At that time a feasibility studies was conducted by JICA for renovation and rehabilitation of KCR to provide modern and efficient commuter system to Karachiites costing $872m. But a fresh feasibility study has been completed by JICA in April 2009, raising the total costs by 83 percent to $ 1600m.
The project is being supervised by Karachi Urban transport Company (KUTC) having the shares of Pakistan railways, Government of Sindh and City District Government Karachi.
Iftikhar Babar also informed that Economic affair division has included KCR in the priority project and recently requested the Government of Japan for financing the project through the pledged amount announced during the recently concluded Donors Conference at Tokyo in April, 2009.