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Event Title: Senator Quratulain Marri, Chairperson Senate Standing Committee on Planning, Development and Special Initiatives Presiding over a Meeting of The Committee at Parliament House Islamabad
Event Date: 2026-10-12
Senate Committee Reviews Foreign-Funded Projects under PSDP 2026–27
The Senate Standing Committee on Planning, Development and Special Initiatives met at Parliament House, Islamabad, under the Chairpersonship of Senator Quratulain Marri to review allocations for foreign-funded development projects under PSDP 2026–27, with particular focus on rupee cover, reliance on foreign borrowing, project completion timelines and utilization of domestic resources.
The Committee was informed that 98 foreign-funded projects, with a total estimated cost of Rs. 8,099.94 billion, were included in PSDP 2026–27, involving foreign assistance of Rs. 4,649.2 billion. Against the demand of Rs. 537 billion for rupee cover, the Economic Affairs Division (EAD) had proposed Rs. 425 billion after consultation with the concerned Ministries, Divisions and donor agencies. However, the National Economic Council (NEC), while approving PSDP 2026–27 at Rs. 1,000 billion against an overall demand of Rs. 2.9 trillion on 10 June 2026, allocated only Rs. 255 billion for these projects due to fiscal constraints and the Government's commitment to domestic financing.
The Chairperson sought clarification regarding projects expected to be completed during the current financial year. Officials informed the Committee that projects with more than 80 per cent physical progress were expected to be completed during the year. The Chairperson emphasized effective monitoring and timely implementation to achieve the projected targets.
Following this, the Chairperson Committee also stressed on reviewing the need for reliance on foreign loans, particularly dollar-denominated financing carrying interest and repayment obligations, when domestic resources and rupee allocations were available. The Chairperson emphasized that the financial implications of foreign borrowing should be carefully assessed and that the Government should explore the effective utilization of local resources to reduce unnecessary dependence on external loans.
The Committee reviewed the M-1-related project wherein the Officials informed the Committee that completion was targeted for December 2026 or January 2027. The Committee emphasized adherence to the proposed timeline and timely utilization of funds.
The Committee underscored that foreign-funded projects must receive adequate rupee cover to avoid implementation delays, while ensuring transparency, accountability, prudent financial management and coordination with donor agencies. It emphasized balancing foreign assistance with domestic fiscal capacity and minimizing avoidable financial burdens.
The Committee also reviewed progress on the M-6 Sukkur–Hyderabad Motorway Project and expressed serious concern over prolonged delays. Officials informed the Committee that Sections I and II were being processed under the Public-Private Partnership (PPP) mode, with the concession award targeted for February 2027. The Asian Development Bank (ADB) was providing transaction advisory services for these sections, while financing arrangements with international development partners had been secured for the remaining sections. Financing of USD 475 million by the Islamic Development Bank (IsDB) for Sections IV and V and USD 230 million by the OPEC Fund for Section III had been secured. Bids for Sections III and IV were under evaluation, while bids for Section V were expected to open in October 2026. Contract awards for Sections III, IV and V were expected by November and December 2026, respectively.
The Chairperson observed that the M-6 project had been under consideration since 2017 and questioned repeated postponements despite its strategic importance. Senator Afnanullah Khan also raised concerns over continued delays and missed deadlines, stressing the need for timely implementation. The Committee discussed the involvement of Foreign and local companies in the bidding process and sought clarification regarding the reasons for delays and the status of proceedings before the Grievance Redressal Committee.
The Chairperson sought a definite timeline for groundbreaking and directed the concerned authorities to avoid further extensions of deadlines. In response to a query regarding the commencement of groundbreaking activities for all three relevant sections in the coming year, officials stated that this would depend on completion of the required approvals and formalities. The Committee emphasized timely decisions, transparent procurement and effective coordination to ensure that the project proceeds without further delay.
The meeting was attended by Senators Shahadat Awan, Saadia Abbasi, Dr. Afnanullah Khan and Jam Saifullah Khan, along with the Secretary Planning and other relevant officials.