Karachi’s Rs68.9 billion Lyari elevated freight corridor shelved over financial unviability

Karachi/Islamabad: The National Highways Authority (NHA) has shelved the Rs68.9 billion Lyari Elevated Freight Corridor project, declaring it financially unviable due to funding shortages and unattractive investment terms.

The decision was revealed at a National Assembly Standing Committee meeting on Economic Affairs, chaired by MNA Sher Ali Arbab. NHA officials explained that the project required heavy upfront financial support — including a Viability Gap Fund grant and loans covering around 35% of the cost — which rendered it “non-bankable” for public-private partnership investment.

Instead, the NHA is now evaluating the Karachi Northern Bypass (KNB) as an alternative. Plans under consideration include expanding the current two-lane bypass into a four- or six-lane motorway to ease freight movement, reduce transport costs, and relieve traffic pressure within Karachi.

Committee member MNA Muhammad Jawed Hanif Khan argued that the Lyari corridor remains vital for Pakistan’s economy and urged the authority to prioritize such projects based on economic benefit rather than political expediency.

The committee unanimously recommended that the Lyari project be included in the Public Sector Development Program (PSDP). Officials added that a long-term freight and logistics improvement plan for Karachi is being developed to address trade and transport bottlenecks.