ADB may offer $500m for Diamer-Bhasha Dam

Bank to finance major water and power projects.

ISLAMABAD:

The Asian Development Bank (ADB) is expected to provide initial funding of $500 million to Pakistan for the multi-billion-dollar Diamer-Bhasha Dam, work on which is expected to start on June 7.

Sources told The Express Tribune that the board of directors of ADB is expected to grant a formal approval for the loan for the dam, which is expected to generate 4,500 megawatts of electricity per day.

Sources said ADB would also consider the option of extending the loan in cooperation with other donors for the project.

Pakistan had also sought $1 billion from the US, which was conducting due diligence of the project through USAID, sources said, adding other the potential donor was the Islamic Development Bank (IDB).

However, the cost is going up due to persistent delay in starting the project. Earlier, the Water and Power Development Authority (Wapda) had expected the project to be completed in 2017-18 but now it will not be ready before 2020-21, resulting in an increase in its cost.

ADB’s Director General for Central and West Asia Jaun Miranda, in a meeting with Water and Power Minister Syed Naveed Qamar on Tuesday, gave the assurance that the bank would finance major water and power projects and fund energy sector efficiency programmes in Pakistan.

Government officials told Miranda, who was heading a six-member delegation, that approval had been sought from the Council of Common Interests (CCI) to develop consensus on the project and the ground-breaking ceremony would be held soon.

Miranda said the bank would provide financial and technical support for the Diamer-Bhasha Dam, adding that modalities would be finalised on a fast track basis. “ADB is also financing private sector hydropower projects,” he added.

Naveed Qamar also sought financing for the rehabilitation of power generation companies, tube well energy efficiency project, small and medium-sized dams and capacity-building of some organisations.

In the tube well energy efficiency project, various parts of tube wells will be replaced with energy-efficient parts in order to save energy.

Highlighting the importance of Diamer-Bhasha dam, Qamar said it would be a multipurpose project, play a vital role in flood mitigation and open a new era of economic development and prosperity in the country.

He also sought the bank’s cooperation in wind and solar energy projects which would generate cheap electricity.

Published in The Express Tribune, May 25^th, 2011.