Peshawar: In a landmark achievement, the National Accountability Bureau of Khyber Pakhtunkhwa (NAB KP) has successfully secured an indirect recovery of Rs. 168.5 billion to the national exchequer, marking the highest recovery in a single project in its 25-year history. This significant financial recovery was realized through a settlement in the International Court of Arbitration, where the Government of Khyber Pakhtunkhwa was facing a contractor’s claim of Rs. 31.5 billion.
According to National Accountability Bureau, the case involved the Bus Rapid Transit (BRT) Project in Peshawar, where in 2018, NAB initiated an inquiry into various illegalities including the unlawful award of contracts and misappropriation of government funds. Under the leadership of the current Director General, the investigation intensified, leading to significant findings and the subsequent financial recovery.
The investigation revealed that six contracts for the BRT project were unlawfully awarded to four joint ventures, which included a combination of two Pakistani and three international firms. These contracts were supposedly established to leverage the international firms’ reputation and financial strength; however, it was found that the actual work was carried out by the local firms, with the international participants receiving 2% of the total tender value without contributing actual work.
Furthermore, the probe uncovered that the local firms transferred substantial sums to the international firms’ bank accounts, coinciding with the dates listed in supplementary contract agreements. This arrangement was part of a larger scheme to defraud the Peshawar Development Authority (PDA), which had paid a 20% premium over the scheduled rate to ensure the project met international standards within six months—a timeline and standard that were never met.
The investigation also exposed that the contractors submitted bogus local and foreign bank guarantees totaling Rs. 8.5 billion. The international firms involved had minimal physical presence in Pakistan, contradicting their contractual obligations.
The extensive investigation by NAB also led to the discovery of additional financial claims made by the contractors totaling Rs. 66.653 billion, which included retention money, cost escalation, and other charges. These claims were also part of the negotiations that led to the settlement.
The resolution of this complex case came after NAB’s strategic pressure prompted the contractors to seek an out-of-court settlement, which was effectively facilitated by NAB KP. Ultimately, the contractors withdrew all claims, and the PDA settled by paying only Rs. 2.6 billion, a fraction of the potential Rs. 168.5 billion liability. This resolution not only averted substantial financial loss but also allowed these funds to be redirected towards other public welfare projects in the province.
This historic recovery by NAB KP underscores its pivotal role in safeguarding public funds and ensuring accountability at all levels of governance.