Fuel cost hits Lahore Metro service

• Private firm says bus operations to be suspended from 11th as talks with authorities fail• Punjab Mass Transit Authority calls move ‘blackmail’, vows to challenge court order against it LAHORE: A private firm operating the Lahore Metro Bus on the 27km Gajjumata-Shahdra route has decided to suspend its operations from Aug 11 after talks with the Punjab Mass Transit Authority (PMA) over rising fuel costs and other issues failed to yield a solution. As the company has served a final notice on the PMA, the authority has termed the move an attempt to blackmail and pressure the government into accepting its demands. It said it would challenge the court verdict against it and invoke a clause in the contract that provides for the appointment of arbitrators by both parties to settle any dispute. According to the final notice, the company referred to its letters of July 31 and Aug 4, which had yet to be responded to by the PMA, and a meeting held on Aug 6 between company representatives and authority officials regarding implementation of the court’s July 29 orders directing the PMA to provide fuel from its own sources. The company further said that during the meeting, it reiterated that it had exhausted its financial resources and was no longer in a position to continue operations. On the occasion, the PMA stated that it was unable to take any decision without directions from the government. The meeting concluded with an understanding that the PMA would propose a solution. However, the company said no solution or arrangement was communicated by the PMA.

It said that unless the PMA immediately commenced the uninterrupted supply of fuel from its own sources in compliance with the court orders, the metro bus operation could not be continued and would stand suspended from Aug 11. “Any such suspension shall solely arise from PMA’s failure to implement the court order and shall not constitute any fault, default or unwillingness on the part of the company. All resulting operational, financial and legal consequences shall rest entirely with PMA,” the letter warned. Talking to Dawn, a senior official of the company said the situation had worsened following frequent increases in fuel prices. “When we took over, the diesel price was around Rs105 per litre or so. Later, the prices continued to rise from time to time, making it difficult for the company to meet its fuel costs,” the official added. “In fact, the formula regarding calculation of fuel cost never reimbursed the company’s full fuel bill, as it covered only a fixed portion of the cost and the gap widened as soon as prices rose. When diesel prices increased sharply, the PMA’s payment increased slightly, but the company’s actual fuel expense increased much more,” the official, requesting anonymity, explained. “A new formula was devised that reduced this gap but did not eliminate it, forcing the company to pay the remaining fuel costs from its own funds and borrowings, resulting in continuous losses and additional costs.” To a question, he said the court in its orders of June 8, 2023 had directed the PMA to provide from its own sources. However, the PMA claimed the orders were already set aside by the respective court. “For this, we sought clarification from the court as to whether or not the June 8, 2023 order had been cancelled. To this, the court issued a clarification on July 29, stating that the order had not been set aside and, therefore, the PMA should implement it, failing which action may be taken,” he maintained. When contacted, a senior PMA official confirmed the court verdict against the authority. “But we have already challenged this order in the relevant court. We are also invoking the contractual provision for appointing an arbitrator to decide the case,” he said, claiming that under the contract the company was being paid on a per-kilometre basis. “We also raised the price. But the company is insisting on a further increase, which we cannot make without getting the government’s nod,” he added. To a query, the official admitted that the PMA was not in a position to implement the court orders until it received approval from the government. “We admit that fuel prices have increased. But we are unable to provide fuel to the company from our own sources as directed by the court. For this, the government [transport department] is the authority to do something,” the official added. He said the PMA had some options to continue the metro bus service even if the company walked out of the system. “Though there could be some issues from Aug 11 onwards, we have managed to arrange some buses from outside in a bid to continue the service,” he added. It is pertinent to mention that the Lahore Metro Bus Service, the country’s first modern mass transit project, was officially inaugurated and opened to the public on Feb 10-11, 2013, running on a 27-km route from Gajjumata to Shahdara. Published in Dawn, August 9th, 2026