ADB chief urges govt to end political impasse

Nakao says the bank is not in a position to extend financing for Diamer-Bhasha Dam

ISLAMABAD: Asian Development Bank President Takehiko Nakao urged the Pakistan government to find a solution to the political impasse that has gripped the federal capital, stressing that the country’s recent economic progress could be compromised due to the instability.

Imran Khan-led PTI and Tahirul Qadri’s PAT have staged sit-ins in Islamabad since August 14, hurling allegations of election rigging at PML-N in last year’s general election. Negotiations between the PML-N government and the two political parties have borne no fruit as protests continue in the high-security Red Zone of the capital.

With the protests now into their second month, the government has expressed its concern over the instability that, it says, has affected the country’s economic progress.

Flanked by Finance Minister Ishaq Dar, Nakao said despite the progress, there were still “challenges to overcome” including the recent floods that threatened the country’s growth rate.

“I was impressed by the strong commitment of the government for reforms to improve macroeconomic situation but there are also many challenges to overcome like the security situation to unlock its true growth potential”.

He said the ADB supported the construction of the Diamer-Bhasha Dam not only due to its benefit to the energy but irrigation sector as well. He said the project was also crucial to increase water availability and flood mitigation.

However, he said that the ADB was not in a position to extend huge financing for the project. Nakao added that Pakistan was also pursuing the $7-8 billion Dasu Hydropower Project and hence, the government should consider the financial feasibility of seeking support for the $13-billion Diamer-Bhasha dam. “The ADB is providing $1 billion annual lending to Pakistan and is not in a position to extend huge financing for Bhasha dam,” he said.

While stressing on continuity of democracy in Pakistan, Nako hoped the present government would show wisdom and be able to come out of the current political turmoil.

Meanwhile, Dar said investor confidence had been hit by developments in Islamabad, delaying at least three major transactions including the issuance of sukuk bonds, OGDCL bonds and disbursement of IMF tranche.

He said the government had arranged financing for the Dasu Hydropower Project and would also complete the Diamer-Bhasha Dam at all costs due to its importance for flood control, overcoming water shortage and providing 4,500MW of electricity.

Published in The Express Tribune, September 18^th, 2014.