Peshawar BRT: KP govt faces ramifications worth billions in international court

PESHAWAR: The Peshawar Metro Bus (BRT) project might prove to be yet another Reko Diq case due to apparent negligence and indifference of the Peshawar Development Authority (PDA).

An international arbitration court in France is likely to hand down a unilateral decision in favour of the contractors who have sought billions of rupees in claims, as the Khyber Pakhtunkhwa government and PDA have failed to hire a counsel to plead their case. The provincial government now faces a substantial payout from the provincial treasury to the BRT contractors.

Informed sources told HUM News English that the case has been going on in the ICC International Arbitration Court in France for the Settlement of Investment Disputes (ICSID) for the past two years, involving the PDA and the contractors, specifically Maqbool Calsons JV, of the Peshawar BRT project.

However, it is noteworthy that neither the PDA nor the provincial government has engaged legal representation in the matter, while on the other side, the consortium of contractors has hired the services of Uzair Karamat Bhandari, who represents a renowned law firm in Pakistan, for legal counsel.

Sources further said that the arbitration proceedings in this case have been in progress for two years and have now reached the final stages. There is a possibility that a unilateral decision may be reached due to the lack of legal representation on behalf of the PDA.

According to a retired officer aware of this dispute and account of past events, disputes arose between the PDA and the contractors of the BRT project over performance security, bank guarantees, and claims during the tenure of the Pakistan Tehreek-e-Insaf government.

In response, he said, the provincial government formed a three-member “Dispute Board” to address these issues. He said that the Dispute Board adjudicated 12 decisions in 2020 and 2021, with some rulings in favour of the contractors and others in favour of the PDA.

However, due to the lack of interest from the PDA authorities, the Dispute Board became inactive over time.

Following the Dispute Board’s dormancy, the consortium of contractors comprising China Railway Group Company and Maqbool Calsons JV, approached the International Tribunal for the Settlement of Investment Disputes (ICSID).

Uzair Karamat Bhandari, the legal representative of Maqbool Calsons JV, confirmed this when contacted by HUM News English.

The Bhandari Associate stated that they had initiated a case against the PDA in the international arbitration court, specifically in relation to the claims. However, they declined to provide details of the claims against the PDA.

When HUM News English reached out to former director-general of the PDA, several officers, former secretaries of the finance department and various provincial ministers, they appeared to be largely unaware of this significant issue during their tenures.