The Karachi IT Park project has encountered another major setback after its second tender failed to attract any bidders, raising fresh concerns about timelines and execution. In response, the Ministry of IT and Telecommunication has sought Rs. 11,500 million in the Public Sector Development Programme (PSDP) for 2026–27 to ensure the Rs. 31,200 million project stays on course despite ongoing delays.
Originally envisioned as a flagship technology hub for Pakistan’s commercial capital, the project has already been delayed by nearly three years, pushing its completion further into the future.
Funding Status and Project Progress
According to official documents, cumulative spending on the project has so far reached Rs. 1,443 million. However, physical progress stands at only 10 percent, while financial progress is recorded at 5 percent. The IT Park is planned as a six-year initiative, but early-stage complications have slowed implementation significantly.
The fresh PSDP allocation request is aimed at maintaining project continuity and preventing further disruption as authorities prepare to float a third tender.
Regulatory Hurdles Near Karachi Airport
One of the primary reasons behind the delay has been regulatory complications. The project site, located near Karachi airport, drew objections from the Civil Aviation Authority (CAA). These concerns required revisions to the building’s design to meet aviation safety requirements.
Additionally, the initial land allotment was cancelled, compelling the Ministry to secure fresh approvals. This process consumed considerable time and contributed to the project’s extended timeline. Officials say these regulatory issues have now largely been addressed, allowing the government to move forward with renewed clarity.
Tender Process Struggles
The procurement phase has proven equally challenging. The Ministry sought to hire a Korean contractor through two separate advertisements, but both attempts failed to generate bids.
The first tender round coincided with heightened Pakistan-India tensions, which officials believe may have discouraged participation. The second attempt, despite a more stable environment, also did not attract any bidders.
Following the approval of the draft Request for Proposal (RFP) by the Korean Exim Bank, authorities are now preparing to launch a third tender. Officials remain optimistic that the next round will see competitive participation, particularly after proactive engagement efforts.
Financing Model and International Support
The Karachi IT Park is structured on the same development model as the Islamabad IT Park and is expected to be financed through a loan from the Export-Import Bank of Korea (Korean Exim Bank).
Around 20 to 25 firms are currently registered with the bank and eligible to bid. To encourage participation, authorities have already conducted a webinar aimed at clarifying project details and addressing contractor concerns.
Officials acknowledged that strict enforcement actions linked to delays in the Islamabad IT Park project may have influenced bidder sentiment regarding Karachi. However, they believe most of those concerns have now been resolved, improving the likelihood of a stronger response in the upcoming tender round.
Project Scope and Facilities
Designed as a 111,000 square meter facility, the Karachi IT Park aims to serve as a comprehensive technology ecosystem. The project is expected to boost innovation, entrepreneurship, and collaboration within Pakistan’s growing IT sector.
The planned facility will include:
Office spaces for startups and small and medium enterprises (SMEs)
Testing and research laboratories
Classrooms and training centers
An industry-academia linkage center
An auditorium and conference rooms
A guest house and daycare facility
A gym and recreational amenities
Restaurants and shared working areas
A modern data centre
Groundbreaking for the project took place in 2022. Since then, the boundary wall has been completed, land testing finalized, and a detailed design prepared by a Korean consultant.
Cost Remains Unchanged Despite Delays
Despite repeated setbacks, the Ministry of IT has maintained that the overall project cost of Rs. 31,200 million will remain unchanged. The focus now is on securing successful bids in the third tender round and accelerating construction to recover lost time.
While the Karachi IT Park continues to face implementation challenges, officials remain confident that once completed, it will play a transformative role in strengthening Pakistan’s digital economy and positioning Karachi as a leading regional technology hub.
Read More
