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A Pakistani court has reinstated the contract of Turkish construction firm 5H Construction for a $200 million water supply project in Rawalpindi. The contract had previously been revoked after the Punjab government failed to release mobilization funds and issue work commencement orders.
According to Pakistani news outlet Dawn, the Lahore High Court ruled in favor of 5H Construction, reinstating the contract and allowing the company to resume work. The court also instructed the government to develop a clear policy framework to prevent similar contract disputes in the future.
The project, intended to address Rawalpindi’s long-standing water shortages, is co-financed by a $122 million concessional loan from the Asian Development Bank (ADB). Known as the Chahan Dam water project, it is designed to supply an additional 25 million gallons of water per day to the city.
According to the petition filed by 5H Construction, the Punjab government withheld Rs2.2 billion (approximately $7.9 million) in mobilization advances and failed to authorize the start of work, despite awarding the contracts in January 2025. These delays brought construction to a halt amid administrative disagreements between provincial authorities and the Rawalpindi Water and Sanitation Agency (WASA).
The Turkish firm had been assigned two critical components of the project—laying a transmission pipeline and establishing a distribution network. The stoppage disrupted supply upgrades in several areas, including 6 union councils along Adiala Road and Khayaban-i-Sir Syed.
5H Construction initially partnered with local firm Qasim Khan & Company, but the joint venture collapsed in 2024 after the Pakistani firm submitted false performance guarantees. Following this, the Asian Development Bank (ADB) and the Punjab Law Department reviewed the case and approved 5H Construction to continue the project independently.
In March 2025, the Secretary of Local Government officially confirmed the Turkish firm’s sole contractor status. Despite this clearance, the Punjab government allegedly froze the contracts and halted progress without providing a public explanation.
5H Construction is a subsidiary of the Turkish Hazinedaroglu Group, which carries out construction projects internationally.
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