Table of Contents

What is
Budgeting
...03
Cost
estimation
..........03
Pakistan
motorway..
...04
Key consideration
included...........
...05
Motorways of
Pakistan............
.......06
Vision
statement
...06
Mission
statement...
..................06
Introduction M2 motorway (Pakistan)
...............07
Composite schedule of
rates....10
Route
...11
Scope of the
project........
..........12
Cost of the
project..
.12
2

Pakistan road sector

contribution..13
National highway
network..13
National highway network
needs...14
The road maintenance account/
fund............15
National highway development
needs....18
M2 tool rates
criteria.
.19
Benefits of the
project.
20
Junctions &
interchanges
.21

Budgeting:
An estimation of the revenue and expenses over a specified future period of time. A budget can
be made for a person, family, group of people, business, government, country, multinational
organization or just about anything else that makes and spends money. A budget is a
microeconomic concept that shows the tradeoff made when one good is exchanged for another.

Cost Estimation:
A cost estimate is the approximation of
the cost of a program, project, or operation.
The cost estimate is the product of the cost
estimating process. The cost estimate has a
single total value and may have identifiable
component values.
en.wikipedia.org/wiki/Cost_estimate

PAKISTAN MOTORWAY
Pakistan has an extensive network of roads and highways, linking every big and small town.
There are several highways like Grand Trunk Road between Lahore and Peshawar, Super
Highway and National Highway linking Karachi with interior of Sindh and Punjab, Indus
Highway linking Peshawar with the Southern Punjab, RCD Highway linking Karachi with
Quetta and on to Taftan (Pak-Iran border) and the Karakoram Highway joining Islamabad with
Kashgar (China) through Abbottabad, GilgitHunza and Khunjrab Pass. A land mark has been
achieved with the completion of Lahore-Islamabad motorway (M2) and Faisalabad-PindiBhatian
4

Motorway (M3), which have opened some of the remote areas of Pakistan for visitors. Another
project of Motorway i.e. Islamabad-Peshawar (M1) will be completed in near future.
The prodigious 333 km long Pakistan Motorway (PM) M2 is a unique project of its kind in South
Asia. It is a six lane road that is linked with major and minor cities through interchanges and do
not pass through or across any city. This project has been successfully tested for the landing of
fighter aircraft of PAF. This project has a unique history which is joyful to read and for the first
time i am presenting on social media, the news clips from 90s to recall the glorious work by
PMLN. The present worth of M2 is PKR 272 Billion.
Pakistan's first motorway, the 367 km 6-lane M-2, connecting the cities of Islamabad and Lahore,
was constructed by South Korea's Daewoo Corporation and was inaugurated in November 1997
and was the first motorway to be built in South Asia.

The construction of motorways began in the early 1990s with the idea building a world class
road network and to reduce the load off the heavily used national highways throughout the
country. The M2 was the first motorway completed in 1998, linking the cities of Islamabad and
Lahore. In the past 5 years, many new motorways have opened up including the M1, M3.

Total: 257,683 km

Paved: 152,033 km (including 339 km of expressways)

Unpaved: 105,650 km (2001)

Vehicles on road: 4.2 million vehicles 250,000 commercial vehicles (2004

estimate)

Key considerations included:

Transport network performance

Accessibility and opportunity for public transport and other transport modes

Local area accessibility and connectivity

Social impact

Environmental impact

Engineering feasibility and construction staging

The criteria used to evaluate the options included:

Motorway operations

Sufficient through lane and interchange capacity

Appropriate interchange and ramp spacing

Motorway access only via interchanges with major roads

High quality road design standards

Operational efficiency

Connections with the local road network

Access to major centers

Environmental impacts
6

Social and amenity impacts

Land use impacts; and

Engineering feasibility and constructability

Motorways of Pakistan:
Pakistan Motorway Project is originally conceived by Mr. Muhammad Nawaz Sharif, Prime
Minister of Pakistan, to provide a country wide link of limited access high speed highway to
bring most parts of the country together which could result in greater economic growth,
commercial activity and trade with ECO countries. It is envisaged that such a system of modern
roads would enable Pakistan to step into the 21st century equipped with a first rate
communication system.
The Motorways of Pakistan are a network of high quality, international standard 'limited access'
highways in Pakistan, which are maintained and operated by the National Highway Authority.
Pakistan's motorways are either six-lanes or four-lanes and are 'limited-access' with a minimum
speed limit of 80 km/h and a maximum speed limit of 120 km/h. They have a central median and
are fenced on the outside for safety and to prevent unauthorized access. In 2009, operational
motorways in Pakistan had a combined length of 770 km.

Vision Statement:
The vision of the motorway project is to provide a transportation system that allows anyone to go
anywhere in the region easily and efficiently.

Mission Statement:
The mission of the motorway project is to provide the public with a safe and efficient
countywide transportation system. The system increases access and mobility, reduces congestion,
improves the environment, and supports economic development, thereby enhancing quality of
life.

Introduction to M2 motorway (Pakistan):

The M-2 is a motorway in the Punjab province of Pakistan. It is 367 km long and connects
Lahore with Islamabad. It passes through Kala shah kaku, Sheikhupura,
KhanqahDogran,KotSarwar, PindiBhattian, Salem, Lilla, KotMomin, KallarKahar, Balksar, and
Chakri before ending just outside the twin cities Rawalpindi and Islamabad. It then continues on
to eventually become the M-1 motorway linking the twin cities with Peshawar. The M-2 crosses
the junction of the M-3 (to Faisalabad) at PindiBhattian.

The M-2 was conceived by Prime Minister Nawaz Sharif in his first term (1990-1993) and later
inaugurated in 1997, during his second term. In late 2006, upgrades were made to the portion of
8

the M-2 passing through the Salt Ranges due to increasing complaints of drivers. The upgrades
included better marking of the road lines and increased size of road signs for easy visibility.

M-2

Title

Lahore-Islamabad motorway

Length

367 km

Type

Public

Direction

North-South

Start

Lahore

Primary destinations

Faisalabad, Sargodha, Rawalpindi

End

Islamabad

Location

Pakistan

Construction dates

1992 - 1997

Major junctions

M-3

Owner

NHAPakistan

Cost

Rs. 30.5 billion.

Co

mposite
Schedule of

Rates:
We have
carried out a
general revision of
prices
unto

January
2009

in

consultation
supplier, and
contractors.
In

all

with leading
manufacturers,
specialist

the

absence
of
standard fix
formula the best
engineering
knowledge
and
rate analysis practices are
used
to
develop these rates. The variation in the proposed rates is anticipated in certain cases, which may
be due to varying degrees / levels of productivity and price differences of various inputs at the
regional level.
The rates, prices and outputs included in the resources and unit cost calculations, including
allowances for wastage, normal productivity and efficiency are based for roadwork and bridge
projects being carried out by NHA. The unit rates are average unit rates for a particular district
10

and not project specific. The market can change very rapidly, which would obviously have an
impact on the unit rates.
It must be understood that main objective of the CSR is to provide a realistic reference base for
preparing Cost Estimates / PC-I and Evaluation of Bids, for NHA projects.
It is hoped that the CSR 2009, would serve as a Basic Engineers Estimate Reference Document
for National Highway Authority, various Government Departments and the construction industry
in general.
Whilst all efforts are made to ensure the accuracy of the data and information used in updating
the CSR , neither NHA or M/s Shabir Associates can in any way accept liability for loss of any
kind resulting from the use of CSR made by any person, institution, company, department etc.

Route:
The M-2 starts to the west of Lahore, at the ThokarNiazBaig junction of N-5 (National Highway
No. 5). Once it crosses the Ravi River, it diverges from the N-5 (also known as GT or Grand
Trunk Road) and heads west towards Sheikhupura. After passing the Sheikhupura Interchange
KhanqahDogran Interchange comes at a distance of 36 Km from the Sheikhupura Interchange.
After once at PindiBhattian, it crosses the M-3 junction and turns north-west. It continues all the
way to KallarKahar, where it enters the Salt Ranges. This stretch of motorway has been
considered the most dangerous road in all of Pakistan for its sharp turns. At certain points, the
maximum speed of all vehicles must be 20 km/h. Once past the Salt Ranges, the M-2 turns north
and ends just west of Rawalpindi at the junction between the Islamabad Link Road and the M-1.
The whole stretch of the M-2 consists of 6 lanes, and there are a number of rest areas along the
route, with washroom and eating facilities.

National Highway Authority

The National Highway Authority is responsible for building and maintaining highways and
motorways in Pakistan. The objective of the NHA is to "plan, promote and organize programs for
construction, development, operation, repairs & maintenance of National Highways, Motorways
& strategic roads.

11

Scope of the Project:

Recognizing the need for high quality road net work in the country, the Prime Minister of
Pakistan inaugurated Pakistan Motorway Project covering the whole of country: from Peshawar
to Karachi and Karachi to Gawadar and Karachi to Quetta and Quetta to Iran. The LahoreIslamabad motorway will benefit Pakistan by improving the socio-economic condition of the
country. Motorways cut journey times, halving the coach journey from Islamabad to Lahore in
Pakistan, and reduced fatal accidents to less than half the level of ordinary roads. One of scope
this project is to make transportation quicker and easier for the people.

Cost of the Project:

It was a massive project involving 3 major river bridges, 8 interchanges, 27 flyovers, 17 bridges
on canal, 39 bridges on drains and 4 overhead railway crossing, 183 subways and cattle creeps,
22 culverts on canals and 73 culverts on drains. The project was approved by the National
Highway Council headed by the Prime minister of Pakistan in 1992 with 60 percent financing by
the Government of Pakistan and 40 percent financing through foreign loans. The project was
completed in December 1997 at an estimated cost of Rs. 30.5 billion.

The estimated cost is 30.50 million but project completed or actual cost not given at anywhere.
The cost of M-2 is 30,500,000 and according to the estimation of 2004vehicles on road are 4.2
million and 250,000 commercial vehicles. If we not include the maintenance charges and other
charges and charge just 20 rupees per vehicles and charge 30 rupees tocommercial vehicle then
12

the daily income of one toll plaza is according to the daily income of toll plazas we can recover
this 30.50 million cost before the six months.

PAKISTAN ROAD SECTOR,

CONTRIBUTION:
Presently the Pakistan Road density of 0.32 km per esq. the total road network is nearly
2,580,000 km. Transport sector has accounted 20-25% of Federal PSDP in the recent years.
Pakistan inland freight and passenger traffic has been growing at an average annual rate of
10.6% and 4.4% respectively during the ten year period between 1991 and 2001. Pakistan has
about 4.2 million vehicles on the road, growing at about 8% annually. This includes about
250,000 commercial vehicles.

NATIONAL HIGHWAY NETWORK

National Highway Authority (NHA) is currently responsible for National Highways, Motorways
and Strategic Roads. Length of the road network under the jurisdiction of NHA is approximately
9,000 km and comprises primarily of strategic and principal arterial routes that serve interprovincial long distance traffic, including important commercial cities and major freight
terminals. Though, the length of National Highways is only 3.3% of the entire road network of
the country but they carry more than 80% of the country's traffic.
Pakistans national road transportation system mainly depends on north-south links because, the
ports are in the south whereas the populous provinces of Punjab and NWFP are in the north. The
two existing major north-south links are the Indus Highway (N-55) on the western bank of the
Indus River and the G.T. Road (N-5) on the eastern bank. The bulk of Pakistans commercial and
industrial activity is concentrated along the N-5 corridor.

13

NATIONAL HIGHWAYS MAINTENANCE

NEEDS:
Present condition of road network of Pakistan can be termed as poor since the traveling
condition of roads and highways has been below the acceptable condition. Results of pavement
condition surveys conducted in 2005 reported 43% of the national to be having poor to very poor
condition. The remaining will be lost in the near future if adequate maintenance and
rehabilitation actions are not taken in a timely and effective manner has NHA recently taken over
major rehabilitation and maintenance projects through PSDP, World Bank, ADB and Japan
assistance. This will definitely reduce the maintenance backlog and maintenance requirements
over the next 5-7 years and improve the ride quality of the roads. The recent HDM analysis
carried out based on the maintenance program taken over by NHA reveals that the average
maintenance requirements of National Highways shall be to the tune of Rs 7.0 Billion per year
for the next five years. This investment combined with other maintenance programs will result in
a saving of over Rs 380 billion (NPV) in road transportation costs alone in the next five years.
The net Toll revenue income of NHA is approximately Rs4 billion per year which when
combined with the MOF maintenance grant of about Rs 1 billion shall make NHA almost self
sustaining in terms of maintenance financing for the next five years. However after fiveseven
years when the development and rehabilitation portfolio would have served its partial design life
shall be burdening the maintenance financing. At that point in time NHA have to sort for other
sources to fund maintenance or else it will be a compromise on the network asset value.
14

THE ROAD MAINTENANCE

ACCOUNT/FUND:
The National Highway Authority Act 1991, as amended in 2001, empowers NHA to benefit from
the commercial use of roads and bridges entrusted to it. Under the Act, NHA is empowered to
collect tolls on national highways. The Act also grants NHA the power to collect revenues from
several other designated sources. Revenues collected from such sources are deposited into
Pakistans dedicated Road Maintenance Account (RMA). The Road Maintenance Account was
established to ensure a stable and secure source of maintenance and operations funding. NHA
has framed rules for the RMA known as National Highways and Strategic Roads Maintenance
Fund Account Regulations-2002. The RMAs standard operating procedures describe inter-alias,
maintenance categories, and utilization of RMA money. However, funds from the federal Public
Sector Development Program may also be obtained in the case of major rehabilitation and
improvements and if such funds are available. NHA has commenced implementation of the feefor-use concept on national highways and strategic roads under its jurisdiction. Tolls are being
collected from road users on almost all major highways. NHA collects tolls directly or enters into
15

a contract with an outside party (selected mostly through competitive bidding) for that purpose.
If NHA collects tolls directly, all receipts are deposited on a weekly basis in a RMA revenue subaccount for the region from which they were collected. The regional general manager ensures the
transfer of all toll money from the regional RMA revenue sub-account to the central RMA
account within seven days of the beginning of every calendar month. In cases of collection
through outside parties, the revenue transfer is made according to the contract signed between
NHA and the concerned party. The operations and management unit of NHA ensures effective
monitoring in both cases. The statement of receipts into RMA is prepared every month. The
monthly statement includes a performance report containing a comparison with projected
receipts and suggestions for improvement, if any. Twice a year, on the 10th of January and July, a
consolidated account statement is made available to all the members and the Chairman of the
Executive Board for budgeting purposes. Central and regional RMAs are reconciled on a regular
basis. NHA has established tolling stations collecting tolls on almost all national highways and
has started charging for the commercial use of right of way by collecting ground/approach rental
charges. The policy guidelines for tolls and charges for the commercial use of right-of-way were
approved by the NHA Executive Board as an interim measure until the final approval is made.
The Board has constituted a committee to finalize the policy for tolling and
preservation/commercial use of right-of-way. It is expected that the total revenue generated for
maintenance works in the financial year 2005-06 will be about PRs 4,310 million. The estimated
funding requirement, determined through Highway Development and Management (HDM-IV)
analysis, for the year will be PRs 7,000 million. Available total resources from different sources
are expected to be as follows:
Revenue receipts through RMA from all designated sources, PRs 4,730 million
Government grants for maintenance, PRs 1,200 million
Total resources vailable, PRs 5,930
Shortfall, PRs 1,070 million
Toll revenue is the primary contributor of RMA resources. The contributions of different sources
into RMA are as follows:
Toll plazas
: 92.0 per cent
Weigh stations
: 1.5 per cent
Right-of-way commercialization
: 1.2 per cent
Hoardings/billboards
: 0.3 per cent
Police fine collection etc.
: 5.0 per cent
The expenditures form the RMA cover the following maintenance categories:

Routine, periodic and emergency maintenance

16

Rehabilitation
Geometric improvement and highway safety improvement
New toll plazas and weigh stations
Corridor management

17

NATIONAL HIGHWAYS DEVELOPMENT

NEEDS:
Government of Pakistan (GOP) provides funds to National Highway Authority (NHA) through
PSDP in the form of Cash Deposit Loan (CDL) to undertake development of road infrastructure
in the country. NHA revenue, i.e. Road Maintenance Account (RMA) and GOP grant from NonDevelopment Budget combine to address maintenance needs of the NHA road network.
Presently, NHA is required to implement a sizable program of expansion and improvement of its
network to materialize the vision of making Pakistan and efficient and reliable International
Transit Hub playing key role in the region. NHA fund requirement obviously has increased while
the GOP resource remains limited. NHA has prepared future needs program for the next five
years, i.e. from fiscal year 2006-07 to 2010-11. The current estimated NHA investment program
in total amounts to some Rs495 billion. The Govt. cum donor funded program amounts to Rs399
billion, of which some Rs89 billion has already been expended up to June 2005. Rs20 billion
shall be expended this year and another Rs. 181 billion in the next 5 years. All this leaves Rs109
billion to be utilized later on; NHA has learnt the lesson that if the financial sustainability of the
program is not ensured then the portfolio needs to be revised on lower side. But the current
development requirements are such that if the stated portfolio is not materialized in time then the
country will loose most of its vision to become an International Transit Hub playing key role in
the region.
The above situation left no choice with the NHA except to maintain its portfolio and innovate to
make it financially sustainable. While reviewing this question of financial sustainability the
aspect of Cash Deposit Loan (CDL) which is equally important also came in the limelight. It
was, therefore, felt prudent to attend to both simultaneously, so that in future such problems do
not arise and NHA is able to achieve its targeted progress in planned time with 10% growth per
year expected to come from non-development budget of GOP) for maintenance and cost.
Before we enter into the proposal, we need to assess the availability of funds. The current years
PSDP stands at 20 billion Rupees and anticipatory financial resource from NHA sources is
expected around Rs 4.30 billion. GOP also allocates maintenance grants from non-development
budget which currently is around Rs 1.00 billion.
The funds requirement in current year is around Rs 25.00 billion for development and around Rs
7.00 billion (Rs 1.5 billion).

18

M2 TOLL RATES CRITERIA:

Toll Rates during Construction Period (for full length of 367 km).
Sr. No.

Vehicle Category

1.

Car, Jeep, Taxi

2.

Wagon, Pickup, Mini Bus

3.

Rupees
15
25

Coaster
4.

5.

25

Bus
Truck 2 Axle/ 3 Axle

6.

30
60

Articulated Multi Axle Trucks

125

Base Year Toll Rates (1st Year of motorway operation):

Sr. No.
1.

Vehicle Category
Car, Jeep, Taxi

2.
3.
4.
5.
6.

Rupees/km
0.412

Wagon, Pickup, Mini Bus

0.588

Coaster

0.882

Bus

1.324

Truck 2 Axle/ 3 Axle

1.618

Articulated Multi Axle Trucks

2.056

Base year toll rates (Rs. Per crossing):

19

Sr. No.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Category vehicle type

Rupees

Car, jeep, taxi

10
wagon, pick up and mini bus
Bus
Mini truck
Truck to axle
Truck 3 Axle
Multi Axle Trucks/Trailer
Tractor Trolley with Agriculture Good
Tractor Trolley with Container/industrial goods
Rickshaw (more than 2 persons)

25
50
50
100
125
150
25
50
10

Toll Escalation: 10% after every 3 years

Toll Escalation: The maximum toll escalation factor that will be allowed in any year will be
calculated as (1+(r/100)), where: r is the annual rate of growth (%) in the General Consumer
Price Index, over the most recent 12 month period for which statistics are available.

Benefits of the Projects:

The Lahore-Islamabad motorway will benefit Pakistan by improving the socio economics
condition of the country. The multidimensional benefits of the project ought to bring healthy,
social, economic, geographical and cultural change according to the sources. The technologies
available today offer a number of ways in which we can better manage traffic flows on our
motorways, including the hard shoulder to traffic during congested periods, as seen on the M2.
The also offer the potential to implement other innovative managed motorway solutions, such as
various form of traffic segregation and access control. Further, into further, the infrastructure
could support in vehicle communications with roadside equipment and other advanced
technology system that could improve driver information, traffic management and road safety.

20

Junctions & Interchanges:

M-2 Motorway
Westbound exits

Junction Eastbound exits

1

Lahore Link Road to Kala Shah Kaku and N-5

To Sheikhupura and Shahkot

To Gujranwala and N-5

M-3 to Faisalabad

To KhanqahDogran and N-5

To KotMomin and Sargodha

To Phalla,Gujrat and N-5

To Salam and Bhalwal

To Rasul, Kharian and N-5

To Lilla and Khushab

To PindDadan, Jhelum and N-5

To Talagang and Khushab

To KallarKahar, Chakwal, Sohawa and N-5

To Balkassar

To Mandra and N-5

To PindiGheb

To Chakri and N-5

Airport Link Road *

10

To Islamabad Link Road

21