The National Highways Authority (NHA) has officially declared the proposed four-lane Lyari Elevated Freight Corridor in Karachi financially unfeasible due to a lack of funding. This revelation came during a meeting of the National Assembly Standing Committee on Economic Affairs Division, chaired by MNA Sher Ali Arbab.
According to NHA representatives, the project’s total estimated cost is Rs68.9 billion. To proceed, it would require a Viability Gap Fund (VGF) grant and operational loan amounting to nearly 35% of the total cost. Due to this high upfront financial requirement, the project is seen as unattractive and non-bankable for public-private partnership (PPP) investment.
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As a result, the NHA has decided to withdraw from the project. Instead, the authority is now exploring alternative freight infrastructure solutions, including a major upgrade of the Karachi Northern Bypass (KNB). The proposed upgrade would transform the current two-lane bypass into a modern four- to six-lane motorway-standard route, designed to handle growing freight traffic more efficiently.
Despite the shift in plans, committee member MNA Muhammad Jawed Hanif Khan stressed the strategic importance of the Lyari project, highlighting its potential to lower transportation costs, support exporters and importers, and ease traffic congestion in Karachi. He called on the NHA to prioritize infrastructure projects based on economic merit rather than political considerations.
In response, the committee unanimously recommended including the Lyari Elevated Freight Corridor in the Public Sector Development Program (PSDP). Officials also noted that a broader regional strategy is in development to enhance freight movement and logistics across the Karachi region.
