The estimated cost of mega projects -- Metro Train, Signal Free Corridor, canal road extension -- for Lahore is about to touch Rs210 billion. The cost will come in the shape of soft loans with an interest rate and the rest will be covered through subsidy.

Orange Line’s cost is likely to go through the roof, making it highly unaffordable in view of government’s shrinking financial resources. The government has set the cost of Metro Train at Rs165 billion. Out of the total amount, the Chinese Bank will give Rs150 million. Punjab government will share Rs15 billion.

However, its actual cost revolves around Rs200 billion. On the Rs150 billion loan, the interest rate that is yet to be finalised, will range between 2 per cent to 2.5 per cent. It means the project will keep incurring the cost of Rs3 billion annually until the loan is paid off completely.

The government has also a plan to subsidise the ticket that will cost Rs20 to Rs35 on one side in line with Lahore Metro Bus system. Around Rs4 billion will have to be given as subsidy, which will automatically inflate the project cost. Operational and maintenance cost with electricity charges, that will be revolving around Rs3.9 billion is another amount that will burden the financial viability of the project.

General Manager (Operation), Punjab Mass Transit Authority’s  Uzair Shah, says the subsidy may reduce if the number of commuters increases. However, he says it is too early to say what will be the subsidy and how much will it cost?

According to one estimate, approximately 250,000 passengers, on an average, will commute on the train and if the number of passengers increases to 500,000 in the coming years, the burden of subsidy will decrease.

Similar is the case with Lahore Metro Bus Service inaugurated in 2013. The government claims its total cost at Rs30 billion. However, if subsidy and maintenance cost is added, it comes to Rs55 billion to Rs65 billion.

During the launch of Metro Bus project, Punjab infrastructure development’s total budget was Rs63 billion which showed that 50 per cent of the development budget of Punjab was spent on Lahore.

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Renowned economist and former Governor of State Bank of Pakistan Shahid Kardar lashed out at heavy-budgeted projects like Metro Bus service and Lahore Orange Line Metro Train. He says the provincial kitty is being emptied to pay their subsidies. "Why a resident living in other districts like Bahawalpur or Sadiqabad should pay the subsidy? If the resident of Lahore is the beneficiary, he should repay the subsidy," he suggests.

Elsewhere in the world, the mass transit system usually runs successfully with about 20 per cent of the commuters. While Lahore Metro Bus is struggling with 3.3 per cent of the commuters. The impact of this metro bus is, therefore, insufficient in reducing congestion.

"Metro Bus is like a taxi service. We are paying Rs70000 per kilometre a year to a Turkish company. Payment to Security companies and LWMC are the others that have to pay to keep the ball rolling," says a Punjab Mass Transit Authority (PMTA) official who does not want to be identified.

The project of 7-kilometre-long Signal Free Corridor from Qurtaba Chowk to Liberty Roundabout Main Boulevard, Gulberg costing Rs1.9 billion is underway with full might. Another controversial canal widening project from Dharampura to Harbanspura will cost Rs8 billion.

A senior official in LDA, asking not to be named, reveals that Rs5 billion were earmarked for projects of safe drinking water and other health services but these funds were diverted to Metro Train project and other LDA road development projects.

Lahore Ring Road Project is to be completed at the cost of about Rs.29 billion. In comparison, the Rawalpindi Metro bus cost Rs45 billion and the government released Rs43 billion in a few weeks.

This year, in sheer contrast to the budget allocated for infrastructure development, health and education sectors have been neglected. Today, 779 schemes of health, education and water are waiting for funds.

Minister for Education, Rana Mashhood, in a press conference shrugged off the perception that road and transport projects have eaten away other sectors’ funds. He was of the opinion that the Punjab government earmarked a record 26 per cent of the budget for education in Punjab.

Lahore Conservation Society, Human Right Commission of Pakistan, and Lahore Bachao Tehreek have denounced the government for this excessive spending on infrastructure and development work.