$720m hydropower accord signed with WB, AIIB

Islamabad

Finance Minister Senator Muhammad Ishaq Dar on Wednesday witnessed the signing ceremony of agreements worth $720 million with the World Bank (WB) and Asian Infrastructure Investment Bank (AIIB) held Wednesday in his office to support projects in hydropower and governance and policy sectors.

On this occasion, the finance minister thanked the World Bank and Asian Infrastructure Investment Bank (AIIB) for extending their continuous support to the present government in its efforts to achieve the sustainable economic development of the country. He said that the present government was focused on economic growth and was making huge investments in energy, infrastructure and social protection. He said that the results of measures taken by the government were already visible. The minister said that due to these efforts, the government had succeeded in overcoming the energy shortage to a large extent resultantly the loadshedding duration had been curtailed for the domestic consumers while uninterrupted supply was being provided to the industries. The minister also said that keeping in view the future demands on account of greater economic activity; the government was enhancing the production capacity of electricity to cater for the future needs as well.

The projects signed on Wednesday are Tarbela-5th Extension HydroPower Project (1410 MW), IBRD Credit of $390 million and AIIB $300 million. The objective of the project is to facilitate a sustainable expansion of Pakistan’s electricity generation capacity by installation of three additional power generating units having installed capacity of 470MW each (total 1410MW) on existing Tunnel-5 without affecting the capacity for irrigation release. The total installed capacity of Tarbela Dam after completion of 5th extension will rise to 6298MW.

The total cost of the project is $823.5 million.  The World Bank (WB) will finance $390.0 million and Asian Infrastructure Investment Bank (AIIB) will contribute $300 million and the remaining $133.5 million will be funded by Wapda ($124.5 million) and National Transmission and Dispatch Company (NTDC) ($9.0 million) for additional Transmission line from Tarbela to evacuate additional power.

The project would help in further development of Pakistan’s hydropower potential along the Indus River Cascade which is a cornerstone of the World Bank Strategy and Government’s energy policy to reduce loadshedding, reduce cost of electricity production, and improve financial sustainability of the power sector. Tarbela-5th Extension Hydropower Project would continue to support a number of community schemes initiated by Wapda for communities of the area under Tarbela-4 extension.