By The National Accountability Bureau (NAB) Khyber Pakhtunkhwa (KP) successfully averted a potential loss of Rs 168.5 billion to the KP government in a long-standing dispute regarding the Peshawar Bus Rapid Transit (BRT) Project. Initiated in 2018, the investigation focused on illegal contract awards, fund misappropriation, and fraudulent performance guarantees submitted by contractors involved in the project.
The inquiry revealed that six civil works contracts were unlawfully awarded to four joint ventures (JVs) made up of two local firms and three international ones. While the contracts appeared legitimate, NAB’s investigation found that these JVs existed only on paper. The international firms received a 2% commission for allowing their names to be used without performing any actual work. Additionally, local firms submitted fake bank guarantees and audit reports, which inflated project costs. Despite the expectation of international standards and timely completion, the project was delayed well beyond its six-month deadline.
As the dispute intensified, the contractors filed claims totaling Rs 31.8 billion with the International Court of Arbitration (ICA), with additional claims expected to raise the total to Rs 168.5 billion for all six project packages. NAB KP’s investigation escalated, and in collaboration with international anti-corruption agencies and local authorities, the contractors eventually sought an out-of-court settlement. Under NAB’s supervision, they withdrew their claims, including the one with the ICA, in exchange for a payment of just Rs 2.6 billion from the Peshawar Development Authority (PDA). The case was officially closed in September 2024, saving the provincial treasury a significant amount that can now be redirected toward public welfare projects.
It is worth noting that the PDA had agreed to pay a 20% premium on the scheduled rate to the contractors to ensure the project met international standards within six months, allowing for the use of better resources and modern technology. However, in violation of these agreements, the contractors failed to complete the project on time, and the international firms never visited Pakistan to fulfill their commitments.
