By SKM
February 3, 2025
ISLAMABAD: Pakistan will get $1 billion loan from the World Bank for Dasu Hydropower project – Stage 1, once the government approves the revised PC-1 of the project with new scopes and timelines, as the cost of the phase-1 of the project has increased by 190.1 percent to Rs1700 billion from Rs586 billion mainly because of the delay in land acquisition, security concerns and increase of US dollar value by 178 percent.
“The project of stage 1 would generate 2160 MW. However, after erecting the stage-II of the project, it would generate 4320 MW. Dasu Hydropower Project is a run of river project on the Indus River located 7km upstream of Dasu Town, District Kohistan (Upper), Khyber Pakhtunkhwa. The site is 74km downstream of proposed Diamer Bhasha Dam site and 345km from Islamabad. Project will generate 4320MW (12 Units @ 360 MW each) hydroelectric power with annual energy of 21445GWh and will be developed in two (02) Stages (Stage-I&II). Stage-I will generate 2160MW (06 Units @ 360MW each) with annual energy of 12,222GWh. Stage-I will be completed in five (05) years. The World Bank has already given the loan of $588 million and also extended the guarantee leverage for generating $460 million from the international market.”
However, under new financing for the project, out of $1 billion, $800 million loan is of IDA and $200 million will be extended under IBRD. Out of IDA loan, Pakistan will attain $435 million at zero interest rate, $365 million at 5.83 percent interest rate and get $200 million under IBRD at 6.13 percent interest rate.
“Yes, we have prepared the revised PC-1 of the project at the cost of Rs1700 billion and will send it within a couple of days to the planning commission for its approval after that WAPDA and WB are to formally sign the $1 billion,” Ministry of Water Resources confirmed.
At the site of Dasu hydropower dam, militants having tentacles of Khawaraj (Taliban) from Afghanistan attacked two times Chinese officials and workers involved in erecting the project. This has also delayed the project manifold. More importantly, the land acquisition for the project has also been delayed as it was to get completed by 2014 but the acquisition process finished in 2021-22. In addition, another reason for escalating the cost of the project is the appreciation of the US dollar by 178 percent to Rs278 from Rs100.
“The project was earlier scheduled to get completed by 2023-24 which would now be completed by 2027-28. Economic Affairs Division (EAD) has played a pivotal role in diverting the Bank’s loan to the project of paramount importance as the WB has already extended $1 billion loans to Pakistan in other heads but was not being spent which is why, the loan has been re-purposed and diverted to the Dasu dam with the approval of the executive board of the bank.”
World Bank, the official of EAD and Water resources Ministry said, had earlier observed that work on 4,320 MW Dasu Hydropower Project has considerably slowed down, due to restrictions on the ground-transportation of international workers and experts from Islamabad to Dasu and shortage of armored vehicles for their movement within the project areas. Ends
