ISLAMABAD, Pakistan: The Federal Minister for Economic Affairs Omar Ayub Khan and the Khyber Pakhtunkhwa Chief Minister Mahmood Khan on Friday witnessed the signing of the financing agreement of the Balakot Hydropower Development Project amounting to US$ 300 million.
The loan agreement was signed by the Secretary at the Economic Affairs Division (EAD) Noor Ahmed and the Acting Country Director of the Asian Development Bank (ADB) Cleo Kawawaki in Islamabad.
The total cost of this project is US$ 755 million out of which the ADB has committed to provide US$ 300 million while the Asian Infrastructure Investment Bank (AIIB) will provide US$ 280 million.
For the project, the ADB is providing financing at highly concessional rates i.e. LIBOR (6-Month) + 0.5% per annum (currently 0.7% per annum) for a period of 27-years including a grace period of 7-years.
While speaking on the occasion, Omar Ayub expressed that this run-of-river hydropower project will be constructed on the Kunhar River in District Mansehra and generate 300 Megawatt electricity.
The Balakot Hydropower Project will not only help unleash the hydropower potential of the country but also improve energy security by increasing clean and affordable energy share in the Country’s energy mix.
“The government is working on renewable energy policy to harness the immense potential in solar, wind, and hydel resources and have good opportunities for investments”, he added.
The federal minister appreciated the ADB’s valuable support for financing this highly important project.
The Khyber Pakhtunkhwa Chief Minister Mahmood Khan reiterated that the provincial government is working on the development of the hydropower potential of the Province on fast track basis.
Mahmood Khan mentioned that the Pakistan Tehreek-e-Insaf (PTI) government was already making huge investments in the development of various hydro sites in the province.
Balakot Hydropower project will provide livelihood by providing more than 1,200 jobs during the construction of the project in Khyber Pakhtunkhwa province.
Once completed, this hydropower project will provide reliable and cheap energy to the national grid. It will also improve provincial revenues streams for the provincial government and boost economic activities in the Country.
“This project shows the strong commitment of PTI government to address the challenges of climate change through the development of clean and renewable energy in line with the vision of Prime Minister Imran Khan”, the Chief Minister added.
The Director-General of the ADB Eugene Zhukov assured of the Banks’ continued support to help Pakistan diversify its energy sources, increase energy security through renewable & affordable energy mix and implement critical economic reforms.
The director-general thanked the minister for economic affairs and reiterated the ADB’s commitment to further strengthen and expand its partnership with Pakistan in the priority sector for socio-economic development of the Country.
The Khyber Pakhtunkhwa’s Energy & Power Department will be the executing agency while the Pakhtunkhwa Energy Department Organization (PEDO) will be implementing agency for the project which is expected to be commissioned by 2026.
