World Bank agrees in principle to fund Diamer-Bhasha Dam
ISLAMABAD: The World Bank has agreed in principle to fund the Diamer-Bhasha Dam, a senior official at the Ministry of Finance told The News.“The Finance Minister had written a letter to the president of the World Bank seeking funding for the project,” he said.
“The Asian Development Bank (ADB) – the lead financial institution in providing funds for Diamer-Bhahsa dam – had asked the government of Pakistan to arrange more funds from big donors such as World Bank, as it cannot arrange the required funding alone,” the official elaborated.
The Islamic Development Fund and the Kuwait Funds are also ready to provide financing for the project.Earlier, the World Bank had refused to provide financing the project arguing that the site of the project is in the disputed territory. The donor bank had taken the stance keeping in view the assertion of India as the neighbouring country says the site of the project is a disputed territory.
“Now the ice has melted and the World Bank has agreed in principle to fund the project. This agreement came on the sidelines of the annual meetings of IMF at Washington,” the official said. In that particular meeting of top economic managers of the country headed by Dr Hafeez Shaikh held on April 22-23, the top man of World Bank, agreed in principle to finance the project.
The Bank, however, seems more interested in funding Dasu Dam, but it has no comparison with Diamer-Bhahsa Dam. Pakistan wants World Bank to fund Diamer-Bhahsa dam.
Dasu Dam will generate the same amount of electricity Diamer-Bhasha Dam has, but Dasu Dam has negligible water storage capacity, whereas Diamer-Bhasha Dam has capacity to store 8 million acre feet of water that will help the country in having a water storage capacity of 15 million acres feet of water similar to that in 1976.
The country has lost the 30 percent water storage capacity in the wake of the silt depositing in Tarbela and Mangla dams reducing the storage capacity to just 11.27 MAF, which is not enough for even 30 days for irrigation. However, India has increased its water storage capacity up to for 400 days irrigations.
The cost of the project of Diamer-Bhahsa Dam stood at $12 billion, which will be recovered in six years after the commissioning of the project. The dam will generate 20 billion units in a year and would ensure $5 million per day benefit to the economy just in the head of cheap electricity. This means if the said project of paramount importance gets delayed, then the country will continue to brave the loss of $1.825 billion in every year.
On top of it, downstream, Ghazi Barotha Hydropower project and Terbela Dam will both increase one billion units of electricity in one year in result of cascading affects of the Diamer-Bahsha Dam. Moreover, the life of Terbela Dam will also increase by additional 35 years, as the pace of piling of sit will reduce manifold, the official said.