Procurement of 75 Locomotives Incurs Billions of Losses to National Exchequer

Fri May 17 2024
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ISLAMABAD: Pakistan Railways project “Procurement of 75 Diesel Electric Locomotives” incurred billions of losses to the national exchequer due to the irregularities in the project planning, supervision, and execution, according to the Audit Report issued by the Auditor General of Pakistan for 2018-19.

The project was planned in haste without any deliberations and without carrying out proper feasibility study, resulting in the twice revision of its PC-1, the report said.  While reviewing implementation of standards/regulations covering safety and quality issues, it was observed that in disregard to provision of contract necessary tests and trial of first batch of ten locomotives were not carried out for six months.

The project was first approved on December 14, 2005 at the cost of Rs 12,700.000 million, and completed by June 2019 when all the locomotives were procured and put into service.

Pakistan Railways incurred loss of the Rs1.213 billion due to acceptance of tender at modified higher price in absence of corresponding modification in technical specification. Moreover, Pakistan Railways suffered financial loss of Rs950.328 million due to premature failure of traction motors/compressors of lo9comotives.

Pakistan Railways’ Other Losses

Pakistan Railways also incurred loss of Rs6.206 million by buying CBU locomotives at higher cost due to non-expansion of production activities in PLF, Risalpur. It also suffered with a loss of potential earning amounting Rs3.122 billion per annum due to underutilization of locomotives.

Pakistan Railways also incurred a loss of potential earning Rs990.924 million per annum due to transportation of lesser trailing load through locomotives.


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