Senate committee uncovers corruption in Rs170bn CAREC corridor, calls for new bidding

The Senate Standing Committee on Economic Affairs revealed irregularities in the Rs170 billion Central Asia Regional Economic Cooperation (CAREC) Tranche-III corridor project, accusing the National Highway Authority (NHA) of corruption, ghost tendering, and awarding illegal contracts. 

According to media reports, the committee noted that all four contracts for the project had been awarded to the Chinese firm Ningxia Communication Construction (NXCC), despite its previous disqualification by the NHA.

Chaired by Senator Saifullah Abro, the committee criticized the NHA for favoring NXCC, which had been terminated in 2023 after failing to complete the Rs6.86 billion Lodhran-Multan project, leaving only 8% of the work completed despite nearly Rs2 billion already being paid.

“The same company, terminated by NHA, has now been awarded a contract worth Rs172 billion for the CAREC Tranche-III project in 2024. How is this company, which was disqualified and terminated, being given a new tender? This is ghost tendering,” Senator Abro said.

The committee ordered the NHA to cancel the ongoing bidding process and start a new one. Several construction firms have already raised objections, filing complaints with the NHA’s Grievance Redressal Cell (GRC) and the Public Procurement Regulatory Authority (PPRA), questioning NXCC’s financial strength and eligibility.

Despite being disqualified in 2023 for not completing the Lodhran-Multan section, NXCC was allowed to bid for the CAREC project. The NHA defended its actions by stating that the firm had been cleared by the court, but Senator Abro questioned why the NHA had not appealed the decision.

Senator Kamran Murtaza raised concerns over why NHA continued to favour a firm disqualified twice and asked whether NXCC had provided an affidavit stating it was not involved in any litigation. NHA officials admitted no such affidavit was submitted, while Senator Abro presented an affidavit from NXCC claiming otherwise, accusing the NHA of misleading the government.

Senator Kamil Ali Agha demanded that NXCC be permanently blacklisted, while Senator Abro called for an immediate suspension of the project, warning that the NHA should not be allowed to proceed with such irregularities.

Meanwhile, the PPRA ruled that the appeal against the NHA’s decision was valid and instructed the NHA to halt the procurement process until the appeal was resolved.

The CAREC Tranche-III project, involving four lots, attracted bids from 20 firms. After the technical evaluation, five firms qualified for Lots 1 and 2, four for Lot-3, and two for Lot-4. The total project cost is estimated at Rs85.44 billion. The project aims to expand a two-lane highway into a four-lane road.

Senator Abro stressed the need for the Federal Minister for Economic Affairs to take action against corruption, warning that billions of rupees are at stake.