Public Private Partnership in Urban Infrastructure; A Case Study Of

Peshawar Bus Terminals (Pakistan)

Fayaz A Khan*, Sikender Azam, Zia Ur Rahman**, Yasir Irfan Badrashi*, Fazal Haq, Abdul Wahab,
Faisal Wahab, Liaqat Ali Shah***
*Assistant Professor, Department of Civil Engineering, UET Campus-III Bannu. Email: fayaz@uetpeshawar.edu.pk
**Lecturer, Department of Civil Engineering, UET Campus-III Bannu. Email: ziaurrahman@uetpeshawar.edu.pk
***Lab Engineer, Department of Civil Engineering, UET Campus-III Bannu. Email: liaqatali@uetpeshawar.edu.pk

ABSTRACT
Public private partnerships (PPPs) are mostly ventured into for provision of infrastructure projects or
services, through transparent means of procurement processes with local or international businesses, civil
societies, voluntary organizations and Non-governmental Organizations. Although the PPP’s are an
ancient phenomenon, it captured the attention of scholars and academia in the 1980’s when they were
embraced globally by Public Administrations. Since then the PPPs have been introspected from many
perspectives, but they all fall into the same pit of political controversies, its long term gains and so on.
This debate is further fueled by the vague procurement regulations which bring all the participants
together, the value each entity adds to the partnership and the profit made by private sector.
However, apart from the public sector the private sector contributes to create the facility/service through
a dedicated standalone business. In Pakistan, as is the case with all developing countries, many
complexities arise when developing infrastructure projects, huge strain is put on fiscal financial resources
and as such private sector provides a much needed relief to the public treasury. This research study aims
at evaluating the suitability and effectiveness of the PPPs model for the establishment and up gradation of
physical infrastructure in Peshawar. The significance and utilization of private sector investment is still
not well appreciated for under taking public facilities or works. In order to encourage the private investors
to contribute in this regard a case study is inevitable to be considered and analyzed accurately. Peshawar
bus terminal is chosen as a case study and the cost and income per day is determined using PPP and then
compared with the present cost and income. It was concluded that there is a huge public investment in
order to construct such a bus terminal that contains all the facilities necessary for the passengers using it.
KEYWORDS
Project, Build-operate-transfer, Contract, Risk, Income

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 1. INTRODUCTION
In Pakistan the major problem is the allocation of funds for the provision of facilities and addressing the
deficiencies in the existing setup. A cursory glance at public sector projects reflects that projects do not
accomplish its full potential due to financial constraints. The Public Sector shortfall means that alternate
avenues have to be explored to achieve the desired objectives and private sector participation ensure
project delivery. However, the definition and procedure of PPPs is quite ambiguous, and no standards
operating procedures are available internationally. This is the main reason for avoiding PPP model in
Pakistan as well as the rest of the developing countries. In [1] this term is referred to as the transfer of
supply and assets associated with the infrastructure, to the private sector for investment in projects that
traditionally have been executed and financed by the public sector. Normally this model shows a joint
venture between government and private entities. Therefore, PPP is the combining of public and private
capital to enhance public services or to manage the public assets in effective manner. The objective is to
provide the service and effectively manage an existing setup with sharing of expenditures and revenue.
The major portion of the risk is transferred from the government to the private sector [1]

The infrastructure plays a key role in elevating the economy of a country and enhancing the life standard
of the citizens. It includes all those physical components necessary for maintaining social services such as
Roads, Railway lines, airports, seaports, water supply and sewerage lines, Transmission and distribution
of oil, gas, and electricity. The development of these elements are directly linked with the economic
growth of the country [3]. Built-Operate-Transfer(BOT) attracted the interest of the government and
private investors for transferring the capital to develop the infrastructure. The suitability of BOT was
assessed by questioners and surveys in Tanzania. It was concluded that BOT is very useful for private
investors to spend in the projects like airports tunnels, bridges, power plants, tourist buildings, telephone
communication and water supply schemes [4]. The private sector is usually interested to invest where the
chances of profitability lies in the maximum range. Therefore some sectors like water supply and
sanitation holds no attraction for these investors and it is necessary to provide such a framework that
serves to attract the private investors for spending in government projects. PPPs involve three major
elements namely shifting of risk, long term contracts and agreements for carrying out fruitful partnerships.
The public sector is deeply concerned with the achievement of the best possible value of money in the
services provided by the private investors. A PPP project can best deliver in case when the revenue stream

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is appreciable and sustainable for long period of time [5]. PPP was used for product development to
discover new medicines for the treatment of neglected diseases [6].

PPP is more fruitful in circumstances when the involvement of the stakeholders is a positive one. The
semantic model can be an effective one for this purpose to exhibit better representation of knowledge [7].
The construction of Highway 407 express toll route (ETR), Ontario, Canada is an example of PPP. It was
108-kilometer-long covering north of Toronto city. It was the joint venture of province of Ontario and a
private consortium [8]. Attempts have been made to fix the PPP model for enhancing the social
infrastructure such as health and education but due to political sensitivities it is still on its way towards
perfection [9]. The percentage of investment in public sector on infrastructure is about 3%. Which is too
deficient for the fast growing countries like China, Russia and Brazil [10].

This research is focused upon bus terminals situated in Peshawar. A terminal is an essential component
of urban transport system that defines the origin and destination of the trips. If managed well a terminal
may act as a catalyst to the social and economic development of the surrounding territory. There are a
number of bus terminals in Peshawar such as Lahore bus terminal, Haji camp bus terminal and Sammi
Daewoo terminal; most of these terminals do not have the basic facilities necessary for
the passengers.

Figure 1 Location of Lahore Bus terminal

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These facilities include mosque, waiting rooms, canteen and toilets which are considered as integral part
of modern bus terminals. This paper will give an overview of an ideal bus terminal constructed through
PPPs approach.

2. METHODOLOGY
This research was carried out by studying the existing intra city bus terminals in order to explore their
deficiencies. This was achieved through visual observations, distribution of questioners among the
passengers and meeting with the concerned personals. The main targeted areas were as listed below.
1. The number of vehicles departing and arriving on daily basis from each terminal.
2. Number of departure bays.
3. Collection of tax from each vehicle leaving for a particular destination.
4. Fair charged from passengers for each destination.
In this way the total number of vehicles leaving Peshawar for other cities and number of people using the
road transport were found and the new area required for the ideal terminal and cost for setting up the entire
facilities were estimated on rough cost basis. The total income per day was determined and compared with
the one to be constructed by PPP.
3. RESULTS AND DISCUSSION
Lahore bus terminal (courtesy speed line and transport officials)
Contract type Service contract on 45%
Area(canals) 100
Traffic frequency 50 (48 seated), 300 (14
seated), 250 (28 seated)
No of destinations 15
Daily income(PKR) 150,000

Haji camp bus terminal (courtesy TMO)

Contract type Lease
Area(canals) 156
Traffic frequency 300 (cars), 1400 (14
seated), 850 (28 seated)

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No of destinations 28
Daily income(PKR) 666,000

5
 Kohat bus terminal (courtesy private contractor)
Contract type Lease
Area(canals) 39
Traffic frequency 50 (cars), 800 (14 seated)
No of destinations 16
Daily income(PKR) 140,000

Data representation Using histograms

(1)Lahore Bus Terminal

46 seated vehicles 28 seated vehicles

14 seated vehicles Cars

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In the same way data were collected for Kohat bus terminal, Sami Daewoo and Niazi bus terminal. This
data was used to carry out further

14 seated vehicles

(2) Haji camp Bus terminal

28 seated and above

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Calculations for a model bus terminal.
Calculation of income for a model bus stand
(1) Cars
Col:
Col: 1 Col: 2 Col: 3 Col: 4 5 Col: 6 Col: 7 Col: 8

passengers (PKR)
Total no: of trips

vehicles (PKR)

Charge 10% of
Total tax from

(Col: 2×Col:3)

(Col:5 ×Col:7)
Destinations

Tax per trip

Total no: of
Passengers

fair (PKR)
passenger

Tax from
Fair per

(PKR)
Mingora 60 400 24000 240 600 60 14400
Turkham 40 300 12000 160 500 50 8000
Bunair 40 400 16000 160 600 60 9600
Abbotabad 40 500 20000 160 650 65 10400
Temergara 50 350 17500 200 550 55 11000
Bannu 40 300 12000 160 600 60 9600
Total 270 101500 1080 63000

(2) 28 seated vehicles

Col:
Col: 1 Col: 2 3 Col: 4 Col: 5 Col: 6 Col: 7 Col: 8
Total tax from

(Col: 2×Col:3)

of fair (PKR)
Charge 10%

(Col:×Col:7)
Destinations

Tax per trip

Total no: of

Total no: of
passengers

passengers
passenger

Tax from
Fair per
vehicles
(PKR)

(PKR)

(PKR)
trips

Mingora 100 224 22400 2800 210 21 58800

Abbatabad 105 340 35700 2940 252 25.2 74088
R.pindi 60 450 27000 1680 210 21 35280
Bannu 20 370 7400 560 224 22.4 12544
Tamargera 35 340 11900 980 260 26 25480
Mansehra 35 390 13650 980 240 24 23520
Mardan 45 123 5535 1260 106 10.6 13356
Dir 40 260 10400 1120 230 23 25760
Chatral 45 320 14400 1260 310 31 39060
Buner 40 390 15600 1120 240 24 26880
Swabi 30 200 6000 840 140 14 11760
Total 555 169985 15540 346528

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(3) 14 seated vehicles

Col:
Col: 1 Col: 2 3 Col: 4 Col: 5 Col: 6 Col: 7 Col: 8

Total no: of trips

Charge 10% of
vehicles (PKR)
Total tax from

(Col: 2×Col:3)

(Col:5×Col:7)
Destinations

Tax per trip

Total no: of
passengers

passengers
fair (PKR)
passenger

Tax from
Fair per

(PKR)

(PKR)
Mingora 90 224 20160 1260 210 21 26460
Abbatabad 75 160 12000 1050 252 25.2 26460
D.I Khan 70 420 29400 980 390 39 38220
R.pindi 100 210 21000 1400 188 18.8 26320
Bannu 85 180 15300 1190 226 22.6 26894
Tamargera 90 340 30600 1260 215 21.5 27090
Mansehra 30 140 4200 420 260 26 10920
Haripur 30 140 4200 420 210 21 8820
Mardan 65 120 7800 910 100 10 9100
Atock 40 120 4800 560 180 18 10080
Dir 50 180 9000 700 220 22 15400
Chatral 20 510 10200 280 600 60 16800
Buner 40 210 8400 560 180 18 10080
Nowshehra 50 100 5000 700 120 12 8400
Nizampur 40 120 4800 560 110 11 6160
Hangu 77 140 10780 1078 130 13 14014
Kohat 100 136 13600 1400 130 13 18200
Chakdara 20 180 3600 280 160 16 4480
Jalozai 40 100 4000 560 120 12 6720
Jahangira 50 120 6000 700 130 13 9100
Bara 20 100 2000 280 100 10 2800
Swabi 40 120 4800 560 150 15 8400
Dara 70 36 2520 980 50 5 4900
M.wali 40 320 12800 560 360 36 20160
Naurang 30 170 5100 420 170 17 7140
L.marwat 35 170 5950 490 214 21.4 10486
Tang 30 116 3480 420 286 28.6 12012
Karak 40 120 4800 560 150 15 8400
T.nusrati 43 120 5160 602 124 12.4 7464.8
Para chinar 47 157 7379 658 283 28.3 18621.4
Sadda 31 120 3720 434 255 25.5 11067
Tal 36 100 3600 504 143 14.3 7207.2
Merali 41 220 9020 574 220 22 12628
Miran shah 39 220 8580 546 340 34 18564
Total 1704 303749 23856 469568.4

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 (4) 46 seated vehicles

Col: Col:
Col: 1 2 3 Col: 4 Col: 5 Col: 6 Col: 7 Col: 8

Tax from passengers

Charge 10% of fair
Tax per trip (PKR)

Fair per passenger

Total no: of trips

vehicles (PKR)
Total tax from

(Col: 2×Col:3)

(Col:5×Col:7)
Destinations

Total no: of
passengers

(PKR)

(PKR)

(PKR)
Faisalabad 4 1040 4160 184 607 21 3864
Karachi 20 1190 23800 920 2158 25.2 23184
Lahore 65 870 56550 2990 800 39 116610
Quetta 10 2520 25200 460 1260 18.8 8648
Bahawalpur 2 700 1400 92 700 70 6440
Multan 14 950 13300 644 950 95 61180
Sadiqabad 5 800 4000 230 800 80 18400
Sialkot 9 1020 9180 414 1020 102 42228
R. Pindi 11 680 7480 506 390 39 19734
Abbotabad 5 500 2500 230 450 45 10350
Mingora 4 480 1920 184 360 36 6624
DI khan 3 450 1350 138 420 42 5796
Total 152 150840 6992 323058

Total daily income is the sum of total tax secured from the vehicle and sum of the tax charged on
passengers at 10% of the fair. This comes out to be 1.928 million PKR.

3.1. Calculation of area for various components of bus terminal

Dr. Richard de Newville (Professor of Systems Engineering and Civil and Environmental Engineering
Massachusetts Institute of Technology) recommends the capacity for an airport building as per table 1.
1.7 Square- meter area should be assumed per passenger with 50% area occupied by the stand. Using
this recommendation the area is determined assuming the number of passengers present in the terminal
at peak hour.

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 3.2. Rough estimated cost of construction

According to the guidelines fixed by “PUNJAB BUILDING DEPARTMENT NORTH ZONE

LAHORE”, The cost for constructing 1 square meter area of non-residential buildings is 14780.29 PKR
provided that the height of floor is 3.35 meters. 170 per sq-meter should be added for every 0.3m rise in
the height of floor above 3.35m floor height. Considering 6.7meter floor height, the estimated cost of
construction would be 1146.27million PKR.

Table 1- Calculated area for components of bus terminal

S. No Name of the component of Calculated area
bus terminal (sq-m)

1 Waiting lodge 40437

2 Booking office 800

3 Departure bays 11780

Mosque with a capacity of

4 15000
1000 people

Restaurant, shops and

5 600
cafeteria

6 Toilets and urinals 68727

4. CONCLUSIONS AND RECOMMENDATIONS

It is obvious from the calculations that the income/day is very small as compared to the total construction
cost. It can be evidently perceived that the allocation of this much amount is almost impossible for the
government sector in a single stage. This is why private partnership should be encouraged to establish
such public facility that is acceptable to the public and they prefer to use such facilities instead of
desperately leaving them. It is strongly recommended to use the BOT partnership for construction of bus
terminals as it is a very successful practice in countries like UK, India and USA. This can help a lot to
improve the lifecycle efficiency of projects resulting in the reduction of operating expenses.

5. ACKNOWLEDGEMENT

This humble achievement is the outcome of the sincere efforts and cooperation made by the officials of
the Lahore Bus terminal and Saami daewo Bus terminal. They must be appreciated for showing their
favour and best code of conduct.

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