ADB gives ‘final chance’ to $360m Central Asia Regional Economic Corridor project

ISLAMABAD: The Asian Develop­ment Bank (ADB) has granted a final one-month extension for the disbursement of a $360 million loan for the embattled Central Asia Regional Economic Corridor (Carec) Tran­che-III project, which has already been delayed by around a year due to issues with the National Highway Authority (NHA). “The ADB approves an extension of bid validity from March 6, 2026, to April 5, 2026 (for a period of 30 days). This shall be the last and final extension of bid validity. The NHA is requested to ensure that the contract award is completed within this extended period, as no further extension is envisaged by the ADB,” the bank said in a recent letter. “Within the same period, the NHA is also requested to provide any new and material information justifying the delay for ADB’s review. In the absence of such information, or if the contract is not awarded within the extended bid validity period, the matter may need to be assessed as a potential non-compliance case, which could affect the financing of the contract and any subsequent procurement actions related to this package,” the ADB said. SC rejects challenge to bidding process Meanwhile, the Supreme Court has dismissed a petition by the Public Procurement Regulatory Authority (PPRA) challenging the bidding process under which a joint venture of three firms — NXCC, Dynamic Constructor and Rustam Associates — was declared successful bidder. The SC, while disposing of the PPRA petition, endorsed the Islamabad High Court’s findings regarding the procurement process conducted by the NHA for the N-55 project. Loan disbursement deadline extended till April 5 It held that the verification of bids submitted by the three-firm joint venture and its credentials had been properly undertaken by the NHA and that no further verification was required. Earlier, the IHC had rejected PPRA’s petition against the Rs172 billion Carec Tranche-III award to the joint venture. In its verdict, the court warned that the regulator’s recent decisions “may also lead to the refusal of the finance facility agreed by the ADB,” and declared the petitions infructuous. Some five parliamentary standing committees had raised objections over the bidding process. However, the NHA maintained all shortcomings had been addressed and the evaluation was conducted according to the prescribed criteria. The authority said that average construction turnover, tax returns and bank statements were adequately verified during evaluation and that no additional verification was necessary. It also argued that the same successful bidder had already been awarded Lots 2 and 3, questioning why further verification was required for Lots 1 and 4 of Tranche-III. In an earlier communication, the ADB had expressed concern that the $360m (Rs108bn) loan allocated for the Carec Development Investment Programme’s Tranche-III could lapse next year without project’s completion. A government source said there was growing realisation within official circles that amid the prevailing global oil and economic crisis, Pakistan should not miss the ADB’s $360m loan. The source warned that if the loan were to lapse, it could undermine the bank’s trust and confidence in Pakistan’s institutions. The delay in utilising the loan stems largely from the failure to start the Tranche-III road project, which was stalled due to disputes over the bidding process. Although bids were opened in February 2025 and approved by the ADB soon afterward, the process faced scrutiny from parliamentary panels and the PPRA. The total project cost is estimated at Rs170bn, including land acquisition, consultancy and taxes, while the lowest bid by the joint venture stood at Rs147bn. Ecnec has already approved the bids submitted by the joint venture of NXCC, Dynamic Constructor and Rustam Associates. The ADB has confirmed it has no objection to awarding the contracts to the lowest bidder across the four lots. Published in Dawn, March 16th, 2026