$4.3 billion Dasu Hydropower Dam hits a blow

$4.3 billion Dasu Hydropower Dam hits a blow
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[image: Pakistan had envisaged that the Dasu project would be completed by December 2021, which would add 2,160MW of electricity to the national grid under the first phase. PHOTO: FILE]

ISLAMABAD: The World Bank has lowered the 2,160-megawatt Dasu hydropower project’s rating to ‘moderately unsatisfactory’ after Pakistan could not resolve outstanding issues in the past over two years, which will now push the completion period beyond 2021.

It was the second downward revision in the project’s implementation rating over the past two and a half years, indicating the systemic bureaucratic weaknesses that have started affecting strategic projects. Last time, the World Bank had cut the progress rating to moderately satisfactory in June 2016.

The previous federal government had failed to resolve a host of land-related issues and could not ensure safety measures, leading to casualties. “The implementation progress of the DHP-I has remained slower than expected,” said the latest implementation status report of the World Bank-funded project, released in the outgoing week.

The report noted that land acquisition has only reached 742 acres, out of the 1,987 acres required for construction areas. The accrued delay during the last two years in acquiring land has now reached a stage where it directly affects the pace of the main works construction, and implementation progress has, therefore, been set to be moderately unsatisfactory, stated the report.

Pakistan had envisaged completing the project by December 2021 to add 2,160MW of electricity to the national grid under the first phase. The previous government preferred the 4,320MW Dasu hydropower project over Diamer-Bhasha dam and then prime minister Nawaz Sharif was initially keen to inaugurate its first phase before the end of his five-year term in 2018.

The World Bank financing is also important for the timely completion of the project’s first phase, which has a total cost of $4.3 billion. The bank has already approved $588.4 million for the scheme. It has also given guarantees of $460 million for raising about $2.5 billion in commercial loans from domestic and foreign lenders. Owing to the slow physical progress, the World Bank released only $179 million or 30.4% of its loan component in the past four years, according to a project progress report of the lender.

Economy