ISLAMABAD  -  The National Highway Authority (NHA) to move a PC-I for approval to get funding from the federal government to settle an agreed claim of Rs1.29 billion of a Malaysian construction giant Bina puri.

The settlement between NHA and the said company was reached with the active pursuance of the Special Investment Facilitation Council (SIFC), which is eying on the possibilities of multi-billion investment in infrastructure sector from Malaysian companies after settlement of this dispute.  

Bina Puri Holdings Berhad’s subsidiary, Bina Puri Pakistan Private Limited was in dispute with NHA against the termination of a concession agreement regarding the construction of 136 km long Karachi-Hyderabad Motorway.  

The said motorway’s project known as “Conversion of the Existing 4-lane Karachi Hyderabad Superhighway into 6-lane Motorway (M-9)” on a Build-Operate-Transfer (BOT)” was awarded to the said company but the agreement was terminated by NHA at a later stage.

The company approached Sindh High Court in April 2013, which referred the dispute to two arbitrators but both could not reach to a conclusion and resultantly the matter had been referred to the Umpire Justice Nasir-ul-Mulk in September 2018.  

In March 2019, the Umpire held in its decision to allow BPPPL’s claims against NHA with a declaration that the termination notice issued by NHA was an unlawful repudiation and breach of the concession agreement.

In light of the decision of Justice Nasir-ul-Mulk, the Sindh High Court also directed NHA to pay the claim amount to BPPPL, however the road authority was delaying the payment on one pretext or another—inviting contempt of court as well.

According to official correspondence available with this scribe, the total claimed amount of the company from NHA was about Rs1.34 billion till 31st of December 2024 including Rs326867 per day as an interest amount.

When SIFC stepped into this matter, the company in addition to the aforementioned amount also calculated some litigation costs while it also demanded to pay the net amount without deducting tax.

However, after successful negotiations, the company and the road authority agreed on an amount of Rs1.29 billion as final settlement and a formal agreement in this regard was also signed a few days ago.  

When contacted, the Member Finance NHA Syed Mazhar Hussain Shah informed that Chairman NHA, Member south zone and Director Dispute Resolution were involved in the negotiation process.

He said the liability was surging against NHA with each passing day while it was creating a bad reputation for the organization as well. He hoped that the amicable settlement with this company will pave way for foreign investment in the country.

According to the settlement, NHA will pay the agreed amount in one go and for that purpose a PC-I would be prepared and its approval would be sought with allocation from the planning commission and finance division respectively.

A senior level source informed that without the involvement of the SIFC, the matter could not be resolved as NHA did not have a relevant head to pay off said liability.