The government has decided in principle to award the Rs205 billion Kharian-Rawalpindi Motorway (M-13) project to the Frontier Works Organisation (FWO) through direct negotiations instead of open competitive bidding, citing the need to speed up construction of the 117-kilometre motorway.
The decision was taken by the Board of Directors of the Public Private Partnership Authority (P3A) after the National Highway Authority (NHA) recommended a negotiated procurement process. Officials said FWO was considered the preferred choice because it has already completed the adjoining Lahore-Sialkot and Sialkot-Kharian motorway sections, allowing it to mobilise quickly.
The proposal will now be sent to the federal cabinet for final approval before the contract can be awarded.
According to officials, the government invoked provisions of the Public Private Partnership Act, 2017, which allow negotiated procurement under specific circumstances instead of international competitive bidding.
The motorway is being treated as a priority infrastructure project because it is expected to reduce the distance between Lahore and Rawalpindi by nearly 100 kilometres and cut travel time by more than an hour compared with the existing M-2 motorway.
The move marks a shift from the procurement plan approved by the Executive Committee of the National Economic Council (ECNEC) in April, when it cleared the project at an estimated cost of Rs203.32 billion and directed that it be awarded through international competitive bidding.
The project’s cost has more than doubled since its original Rs96 billion estimate approved in 2022 after the route was upgraded from four lanes to six on the recommendation of the Special Investment Facilitation Council (SIFC).
The motorway will be developed under the Build-Operate-Transfer (BOT) model and will require more than Rs40 billion in federal viability gap funding.
In a statement, the P3A said the board reviewed the proposal under the relevant legal framework and agreed that the NHA could process the case through the Ministry of Communications to obtain all required federal approvals.
The board added that key commercial terms—including financing arrangements, the concession period, tolling structure, risk allocation and investor returns—will be evaluated separately before the concession agreement is finalised.
