STATUS REPORT OF THE FEASIBILITIES/PC-Is

a.

Prologue:
The Sarhad Tourism Corporation unlike its sister corporation commenced its activities in
1991 primarily focusing on awareness raising. The corporation simultaneously after
deliberations in the 1st three Bods meeting embarked upon detail planning exercises. The
outcome of the planning exercise materialized in the form of PC-II and ToRs for master,
Regional and Area Specific PC-Is/Feasibilities. Subsequently the ADPs of 93-94-95
provided grant in aid for these studies after observing all the codal formalities such as
concept papers approval by the competent forms i.e. DSC/PDWP/DCSC/PCSB. However
after the nation wide advertising in May 95 the award of these feasibilities came late in
early 96. in Mid 96 work plan and composition of teams from consultants selected were
called upon ending on signing of Agreements.

b.

Over all goals:

The notion behind commissioning these feasibilities studies (and if any future studies to
be conducted), is to develop a via media wherein the participation of the people, private
sector in collaboration with public sector is ensured for making tourism an income
generating venture. the tourism sector enables and country to skip the industrialization
phase and directly additional income is ensured thereby increasing the GDP. tourism may
not be only rest and recreation but it can be a first hand knowledge culture heritage,
ecosystem preservation as well as natural geography the feasibilities under completion
have been modelled on the outlines accepted internationally for developing an economy.
In the context of NWFP the reports drafted by the consultants have touched upon ancient
civilizations, traditional handicrafts, diverse ethnic cultures and of course the scenic
beauty. The snow covered peaks, the lush green forests and dry barren mountains all have
been taken into account. Even village level guest houses, roadside facilities, motels,
hotels, hospitals post offices, rail road, air as well as water ways have been taken into
account. the need for training and trained tourist guides has also been addressed. Water
sports trophy hunting, skiing, camping, hiking, trekking and mountaineering besides
traditional games have also been included in the reports. The overall strategy is three
pronged for tourism development starting for short term measures expanding into
medium term measures that are consolidated in long term measures. The overall goal is
certainly to alleviate poverty by harnessing the people potential through different tourism
related entrepreneurial activities in a traditional Pakistani culture and environment.

c.

Agreements/Contracts:
As a matte of policy the standard agreement format of the PE&D development was
adopted with slight modifications. The modification was both the incorporation of the
terms of reference into the scope of work together with the time frame and other minuets
details. All the agreements executed with the consultants were probably as innovation
from the past practice wherein ToRs used to be separate annexure of the contracts. All the
agreements provided for the clause that not only the feasibilities/PC-Is would be
Completed but also private sector financing would also be identified that is to say if the
same PC-Is are implemented by government or private sector as a joint collaboration
what would be scenarios. These agreements further bounded the consultants to not only
consult the public sector but also the private sector and respective communities directly
to be affected or effected with a special emphasis on the environmental impact
Assessments.

d.

Time Frame: The Area specific studies were to be completed in four months time while
Regional and Master studies in six month time. however when the consultants began their
work they were frustrated and non of the consultants were able to abide by the time.
There fore the corporation in public interest tookup the matter with PE&D department
wherein it was decided in principle that the feasibilities/PC-Is would be sent to them for
final approved by the present Managing Director. Subsequently the consultants were
taken into confidence and the work continued albeit it is moving rather very slowly.

e.

Financial Phasing:
Unlike other feasibilities the corporation bifurcated the amount of the total cost approved
for each study into five instalment each of 20%. the final payment of 20% was made
conditional to three months periods after the acceptance of the project documents by
Government of NWFP in the PE&D Department. In almost all the feasibilities except for
three area specific studies wherein draft PC-Is have been received payments have made
upto 40% of the total cost. In the due course of time the financial situation of the ADP
shrunk form millions to almost zero allocation in the FY 96-97. The financial Crunch also
hampered the pace of completion of the studies and even today an amount of Rs. 1.5
million out of a total of Rs. 2.2 million is pending release by Finance Department.

f.

Workshops and circulation of studies:

The corporation arranged a prelimenary work shop on 14&15 September 1996 in order to
involve the stake holders that is public sector, private sector, public representatives,

individuals, press media and communities to give their feed back on the quality of
worked competed till mid Sep'96. Since Sep'96 the workshop report had been circulated
to all the commissioners, participants of the workshop as well as the consultants for feed
back. Similarly the revised reposts received in late 96 or early 97 were dispatched t the
district administrations of the respective localities where the studies were being under
taken to their feed back. Except the district administration Mansehra no single comments
have been received despite remainders. Thus it is under consideration of the corporation
to inform all the consultants to go ahead with their studies in order to submit the same to
PE&D department for final approval or observations if any. In the mean while STC will
proceed with releasing one instalment each to the concerned consultants in order to give
them a positive signal but subject to release of Rs. 1.5 million of funds by the PE&D
Department. Reminders would also be sent to the district administration concerned for
expediting their comments with a deadline otherwise it will demand that they do not have
any reservations.
g.

Epilogue:
There are in total 8 area specific, 2 regional and one master one Master feasibility study.
In two area specific feasibilities PC-Is have also been received. In other two area specific
feasibilities the detail feasibilities have been received while leaving yet another one
feasibility the remaining 3 area specific feasibilities out of the eight revisions alongwith
detail designing is required in general the feasibilities of regional plans are satisfactory
but lacking designs for facilities. While the Master plan needs more elaborate details even
it has to be a very lose umbrella project document of the all the other studies giving more
elaborate details not touched buy the remaining studies especially for the southern parts
of the province including plans of Peshawar and Mardan division.

The detailed table giving detail of each case is clearly visible from the table it is imperative for
the promotion of sustainable environment friendly tourism development that some of area
specific plans are taken up by the public sector in order to give a demonstrative effect.
Subsequently private sector will come up for financing of the other area specific regional and
master plans. It is also proposed to firm up private sector loans from international financing
institutions by engaging international financial advisory firm as already indicated by STC in its
private public partnership proposal annexed to this status report.
The Prime Minister directive on provincial tourist police as well as tourism authority also needs
to be part of the provincial, master plan. Also the directive of CM, NWFP, NA committee on

tourism and provincial committee No.17 have to be appropriately adjusted in the tourism plans
which have partially addressed these issues.

S.
No

Name of feasibility

Approved
Cost

Amount
paid

Amount
outstanding

Status of
feasibility

Master Plan for Tourism

development in NWFP

650,000

260,000

390,000

Draft Final
Report
Submitted to
STC

Regional Master Plan for the

Promotion & Development of
Tourism in Hazara Division

452,000

180,800

271,200

Regional Master Plan for the

Promotion & Dev. Of Tourism
in Malakand Division

452,000

Chairlift Scheme Galyat

450,000

do

180,800

271,200
do

180,000

270,000
do

National Park & Tourism

Facilities at Mahudand Swat

328,000

196,800

131,200

Draft
Report+PC-I
submitted to
STC

Additional Facilities at Tourism

Complex Kund

214,000

128,400

85,600

Draft
Report+PC-I
submitted to
STC

Recreation Theme Park at

Tanda Dam, Kohat

162,000

64,800

97,200

Draft Final
Report
Submitted to
STC

Trekking and Camping in

315,800

189,480

126,320

Galyat and Kaghan

10

11

do

Rest & Recreation Park at Lake

Saiful Maluk

280,000

Extension of Miandam Hill

Resort

350,000

Acquisition of Land Adjacent to

Kabal Golf Course

300,000

Grand Total

3,953,800

112,000

168,000
do

140,000

210,000
do

120,000

180,000
do

1,753,080

2,200,720

PROPOSAL FOR PRIVATE SECTOR PARTICIPATION IN TOURISM

PROJECTS OF THE SARHAD TOURISM CORPORATION

OVERVIEW:
-------The Sarhad Tourism Corporation was primarily formed for the promotion of sustainable
tourism development in the form of an industry due to the natural and scenic resources of the province.
The Sarhad Tourism Corporation had floated 12 Nos. of feasibility studies for the development of
environmental friendly tourism industry at the provincial, regional, local and village level. The Master
plan, Regional plan and Area specific local plan are the different feasibility studies being carried out for
the drawing up the attention of the private sector the potential investor and the govt. of NWFP itself for
appropriate funding.
IDENTIFICATION OF THE AREAS FOR INVESTMENT BY STC.
------------------------------------------------STC with grant from Govt. of NWFP and International donors is poised to develop the
existing properties at various stages of a process that is suppose to result into the ultimate transfer those
properties to the corporation. The second areas those can be associated with Govt. of NWFP are area
specific plan.
IDENTIFICATION OF THE AREAS FOR INVESTMENT BY PRIVATE SECTOR.
-----------------------------------------------------------The private sector should concentrate for investment in the Master and Regional plan by
virtue of erecting tourist facilitating infrastructure at the spots identified in the Regional or Master
feasibility studies being carried out by the consultants. The private sector be provide with land and all

basic services at the proposal of govt service at very nominal charges on long term lease basis through the
Sarhad Tourism Corporation.

IDENTIFICATION OF THE AREAS FOR INVESTMENT BY PRIVATE SECTOR AND STC AS

JOINT-VENTURE.
-----------------------------------------------------------There can be areas where part of the funds support permissions concessions those can be
grated to the private sector by STC as part of capital investment required for the project to be executed by
the private sector and thereby STC will earn in the long term and adequate amount to run its operation
and maintenance costs. However all the partnership with the private sector make carefully be scrutinized
by the govt. through hiring special services organization such as Arthur D. Little investment organization
for attracting and pooling funds for viable tourism related infrastructure.
KEY AREAS FOR INVESTMENT BY PROVINCIAL GOVERNMENT SECTOR AND STC AS
JOINT-VENTURE.
-----------------------------------------------------------------The govt. has vary easily available resources in the form abandoned, difficultly
maintained and outdated buildings in the form of rest houses, inspection bungalows and out posts that can
be renovated by STC and run on a sustainable environment friendly entrepreneurship basis. The present
list of STC indicates around 60 properties in NWFP in addition to 18 properties specifically in Chitral
which can be right away transferred to STC for renovating and operationalizsing on commercial through
leasing out to the private sector.
THE MANNER OF PROPOSED PARTICIPATION WITH THE PRIVATE SECTOR AND THE
PROVINCIAL GOVERNMENT IN SECTORS RELATED TO TOURISM.
-----------------------------------------------------------------It is almost five years that corporation have been formed and a fairly outline of the areas
that have been highlighted above can be set to further improved finances availability by hiring the
services of an expert international lobbyist cum advisor such as the Arthur D. Little.
For any partnership that is important is the basic details are work out including its present
and future indications. There is no doubt that economic internal rate of return or for that matter financial
rate of return is the most profitable in terms of opportunity investment of tourism. There are successful
tourism alight industries in the world that has not only generated income for sustaining not only those
organization but have even resulted in charitable grants for other source social infrastructure from the
corporations's income. In terms of investment equity, property, credit and guarantee for loans if any to be
obtain from loan to international lending organization has to be outlined as following:
a)

EQUITY:
It is very important for any project to be self sustaining in the long run but to start with hard cash
is required to make it working from paper planning to physical implementation. Therefore an
overall outlay of cost has to be drawn for example as given below:
Example: Cost of provincial master plan estimated @ of Rs. 1 thousand billion has to be divided
into five equal parts out of which one part would be provided by STC to grant in aid from the

govt in form of land, building and equipment etc., alongwith guarantee for loans or making
available line of credit for landing it to the private sector to cover up the other four parts of the
total cost of the master plan as estimated one thousand billion. This works out to be eight hundred
billion investment by the private sector two hundred billion investment by the Govt. through STC
in the form of concession, guarantees, loans and leases etc.
b)

PROPERTY AND LAND AS CONTRIBUTION:

Any land of the govt can be leased out to the STC on short, long and medium terms basis by
mutually agreed proportions of investment settle with the private sector. However international
lobbying for obtaining concession, guarantees OR international loans require the services of an
expert organization that is recognize by the international law and for that matter by the
international financing organization such as Arthur D. Little etc.

c)

CREDIT:
International lending organizations including the Asian Development Bank, all the commercial
private and public banks and the international financial institutions have special credit line for
viable sustainable tourism infrastructure programme. In order to make the participation of
international, regional, local and area specific entrepreneurs in equal proportion it is important
that an expert financial institution consulting services be engaged on a long term basis that would
pay of itself out of the profit that are accrued to the corporation and the govt. after the
commissioning of most of the tourism development plans.

d)

LOANS GUARANTEE:
For providing maximum opportunity to the tourism sector the govt. through the Sarhad Tourism
Corporation with the support of Khyber Bank and National Investment Committee would enter to
the agreement with an internationally sound and upto the mark financial advisors to divert the
required foreign exchange for the tourism sectors to develop on sustainable basis as an income
generating industry.

OUT LINE OF THE PROCEDURE OR IMPLEMENTATION OF PARTNERSHIP VIA THE

NATIONAL INVESTMENT COMMITTEE THROUGH INTERNATIONAL FINANCIAL
ADVISOR BY THE STC THROUGH GRANT IN AID FROM THE GOVT. OF NWFP FOR
PROMOTING TOURISM AS AN INDUSTRY.
------------------------------------------------------------------The Govt. of NWFP has received an offer from an international financial expert organization
recognized internationally namely Arthur D. Little that may be engaged through the national investment
committee by making responsible the Sarhad Tourism Corporation as the principal representative of the
govt of NWFP for promoting tourism in the province. The Govt of NWFP after the engagement of
international financial advisory services ask the Sarhad Tourism Corporation to offer at nominal lease
initially govt land and properties through the national investment committee for providing an incentive to
the private sector and taking up tourism an industry. Transparency in financial management of the long
term plans be achieved through revising sustainable operation plans by the international expert advisory
service engaged through STC by the Govt. of NWFP involving the national investment committee for
concluding agreements with the international financial institutions that are not less than the required

amount of the total out lay for the tourism sector in the next century in the province.