World Bank refuses to fund Diamer-Bhasha dam

By Ali Nawaz Memon, Mayland, USA

If the World Bank has really refused to finance projects in Azad Kashmir and Northern areas, what does it mean? UNFORTUNATELY, IT COULD MEAN THAT: 1. The World Bank questions Pakistani ownership of these projects and therefore does not want to lend for that until Kashmir issue is settled. 2. The World Bank will only consider hydel projects in non-controversial areas of Pakistan. Guess what? Kalabagh is the main project meeting that criteria.

No wonder, Ministry of Water and Power and WAPDA has not made a strong protest about the WB policy. They seem to be willing to work within the guidelines imposed by the World Bank.


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Ali Nawaz Memon

Sindh Development Institute
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Gaithersburg, Maryland, USA 20879



World Bank refuses to fund Diamer-Bhasha dam

Thursday, July 31, 2008

By Dilshad Azeem

Courtesy and Thanks: The New, Thursday, July 31, 2008

ISLAMABAD: The World Bank has categorically refused to fund water and power projects in Azad Jammu and Kashmir (AJK) and the Northern Areas (NAs), including the Diamer-Bhasha Dam, The News has learnt.

“The bank’s refusal to provide funds has virtually endangered the practicability of the Bhasha Dam on whose feasibility and technical reports huge amounts have already been spent since 2006,” sources privy to a high-level meeting said.

The meeting was told that the Water and Power Development Authority (Wapda) required $30-40 billion for the projects, including the Bhasha Dam and others in the next 15 years to meet the growing electricity requirements through cheap power.

Water and Power Minister Raja Pervez Ashraf, Wapda Chairman Shakeel Durrani, officials of the Planning Commission, the finance ministry and the Economic Affairs Division attended the meeting held at the Water and Power Ministry on hydropower generation and water resources.

“Wapda raised the issue of financial resources for its mega projects, which is a big challenge as the Word Bank has declined to finance the Diamer-Bhasha Dam and other projects in the Northern Areas and the AJK,” the minutes of the meeting reveal.

The document, available with this correspondent, states that the water and power minister, concerned with the World Bank’s refusal to fund Wapda’s projects in the AJK and the Northern Areas, made an observation on this occasion that we had to live with these constraints.

“It was proposed that a study may be undertaken whereby one fourth of the amount required be provided through the PSDP and surcharge on electricity consumption, one-fourth through suppliers credit and DFIs, one-fourth be raised through the market/loans and one-fourth through private sector stocks sale and investment.”

“The Planning Commission and the Economic Affairs Division and the finance ministry would coordinate the issue of raising the finances,” it reads. The six-page document consists of the Wapda chairman’s briefing on the overall water and power scenario, the Economic Affairs Division officials’ update about refusal of funds by the World Bank, financial resources for the water and power sector, views of the provincial governments, small dams construction and ignorance of hydropower projects.

The Wapda chairman, in his briefing, authenticated the failure of both the political as well as the military governments during the last three decades. “Development of water storages and hydel power development have been ignored – apart from the Ghazi Barotha project (1,450 MW) – over the past 30 years. The country is now paying the cost of this neglect,” the Wapda chairman was quoted in the document as telling the meeting.

The Wapda chairman maintained that currently Wapda was implementing projects for generation of 25,000 MW. “During the next five years, hydel projects with generation capacity of 20,000 MWs could be started.”

The News contacted Wapda’s official spokesman Razaul Haq Siddiqui to seek his department’s version, who stated “definitely the Wapda chairman owns his points mentioned in the minutes of such a high-level meeting chaired by the water and power minister.”

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