By Our Correspondent / Creative: Jamal Khurshid Published: July 21, 2013
ISLAMABAD: As the $14 billion strategically important Diamer Bhasha Dam remains stuck due to reluctance of international financiers, Pakistan has again requested the Asian Development Bank (ADB) to release funds for the much-delayed project.
Finance Minister Ishaq Dar made the request in a meeting with ADB’s Country Director Werner Liepach here on Saturday.
Dar said the new government was working on various initiatives to jump-start the economy and “looks forward to ADB’s assistance for the construction of Diamer Bhasha Dam”, according to an official handout released by the Ministry of Finance.
Liepach was said to be supportive of the project and said the ADB was willing to work with Pakistan in designing a “workable model for the implementation of the project”.
An earlier move by the ADB to bring the World Bank on board for co-financing the project backfired when the WB insisted that the ADB first seek a no-objection certificate from India – a condition that has delayed the project. Delhi believes that the project site is in a disputed territory.
The ADB has taken a lot of flak after asking for Indian NOC at the eleventh hour when Pakistan had already met agreed prerequisites. The ADB wanted the WB to provide $2.5 billion to match its financing.
Compared to initial estimates of $11.2 billion, the revised cost of Diamer Bhasha Dam is touching $14 billion and construction work is yet to start. Lately, Japan has come forward with a $4 billion package for purchase of machinery, but still the lead financier is missing.
Liepach said the Manila-based lending agency was ready to work with international financial institutions and the government of Pakistan on energy, transport and infrastructure projects.
ADB’s Director General for West-Asia Department Klaus Gerhaensser is also coming to Pakistan next week to interact with the new government. The visit is aimed at understanding the policies and plans so that the ADB can prioritise its projects and programmes in line with the requirements of the government.
The ADB was in the process of reviewing Pakistan’s annual portfolio and the business operation plans.
It was not clear whether the government would also take up Diamer Bhasha financing issue with Gerhaensser.
Liepach reaffirmed that the ADB was keen to work closely with Pakistan in its efforts to reinvigorate the economy. The bank was already extending technical, advisory and financial support to the government in translating its plans and concepts into financially viable projects and their efficient execution.
During the meeting, both sides held in-depth discussions on the policies and measures being taken by the government to steer the economy out of its present challenges and place it on the road to growth and development.
Liepach expressed the hope that Pakistan would increase its share in projects, thus the ADB could assist in participating in a larger number of projects.
Published in The Express Tribune, June 21st, 2013.