Infrastructure governance risks in Pakistan
Infrastructure development is one of the largest components of Pakistan’s development budget, with major projects financed and implemented at the national level. In June 2025, the federal government announced budget for the fiscal year 2025, allocating Rs. 1 trillion for the Public Sector Development Programme (PSDP). The core infrastructure receives approximately 60% of the federal PSDP. These projects include major transport corridors, large scale dams, energy infrastructure and climate related transition projects. They carry significant potential for economic growth, connectivity and climate resilience. Yet their governance has often been marked by weak transparency, limited accountability, opaque procurement processes and exclusion of communities from the decision-making procedures. These governance gaps have resulted in fiscal stress, environmental risks and projects which fail to complete in time with huge cost overruns borne by the public exchequer. For Transparency International Pakistan, whose mandate focuses on strengthening integrity, accountability and transparency, infrastructure projects represent a priority sector for reform. This is especially relevant at the intersection of climate governance, access to information and procurement integrity.
Key governance challenges
Large scale infrastructure projects are highly vulnerable to political capture and short term considerations. Project selection often bypasses rigorous cost benefit analysis or climate resilience assessments. Feasibility studies are either incomplete or not disclosed, which limits public scrutiny and independent oversight. Debt sustainability and affordability checks are rarely integrated into planning, which exposes Pakistan to heightened fiscal risks.
Procurement processes remain insufficiently transparent, with frequent use of direct contracting, single-source procurement, restricting competition and limited disclosure of project information. Environmental and social safeguards are inconsistently enforced. Though mandated for all public sector projects, the Environmental Impact Assessments (EIAs) are only conducted in limited manner to secure project approvals. Consultations for EIAs are often treated as procedural requirements rather than meaningful exercises, resulting in infrastructure illegally built in floodplains, on riverbeds, further exacerbating Pakistan’s existing climate vulnerabilities.
Right to Information frameworks exist but compliance remains poor. Project information including feasibility studies, environmental impact assessments, contracts award information and monitoring reports remains accessible only in limited ways to citizens and civil society. This limits opportunities to hold implementing agencies accountable for projects and investments failing to deliver their intended outcomes and benefits for the communities.
Why ICRAT?
TI Pakistan will focus its ICRAT application on policy side looking at gaps in terms of approval of infrastructural projects at national and provincial levels and lack of citizens involvement in the decision making. The sectors which constitute the core of infrastructural budget outlay in Pakistan such as large dams, energy generation projects, and national motorways will be assessed to examine project selection criteria, fiscal and climate risks, procurement integrity and disclosure practices against benchmarks in ICRAT assessment to propose recommendations for future infrastructure projects at federal and provincial levels in the country.
The process will combine desk research, analysis of legal and policy frameworks, development planning documents, Pakistan Public Procurement Regulatory Authority (PPRA) rules, the Public Private Partnership (PPP) Act and PEPA 1997, and stakeholder consultations with the Planning Commission, Ministry of Finance, Ministry of Climate Change, PPRA, civil society and communities. Special emphasis will be placed on evaluating compliance with RTI laws by testing accessibility of project related data.
The findings will be synthesised into a comprehensive research report by December 2025, with clear and actionable recommendations for improving transparency, accountability and climate governance in major infrastructure projects. The process will be accompanied by awareness campaigns, media engagement and a national level dissemination workshop, consistent with TI Pakistan’s mandate to advance open and accountable governance.
Why this matters now
Pakistan is at a critical juncture. Mounting debt obligations, ambitious infrastructure commitments, external financing for infrastructure and escalating climate vulnerabilities demand governance that is both transparent and climate resilient. As the largest share of development investment flows into infrastructure, reforming governance in this sector will have system wide impact. By applying ICRAT, TI Pakistan will provide an independent assessment of corruption risks and governance gaps in large scale projects, strengthen advocacy for data disclosure under RTI laws and procurement rules and contribute to ensuring that public investments are sustainable, equitable and accountable.