Islamabad: Mr. Omar Ayub Khan, Minister for Economic Affairs and Mr. Mahmood Khan, Chief Minister of Khyber Pakhtunkhwa witnessed the signing of financing agreement of Balakot Hydropower Development Project amounting to US$ 300 million. The loan agreement was signed by Mr. Noor Ahmed, Secretary, Economic Affairs Division (EAD) and Ms. Cleo Kawawaki, Acting Country Director, ADB. Total cost of this project is US$ 755 million out of which ADB has committed to provide US$ 300 million while AIIB will provide US$ 280 million. For this project, 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, Mr. Omar Ayub Khan, Minister for Economic Affairs expressed that this run-of-river hydropower project will be constructed on Kunhar River in District Mansehra and generate 300 Megawatt electricity. Balakot Hydropower Project will not only help unleash 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 immense potential in solar, wind and hydel resources and have good opportunities for investments”, he added. The Minister appreciated the ADB’s valuable support for financing this highly important project.
Mr. Mahmood Khan, Chief Minister of Khyber Pakhtunkhwa reiterated that the Government of Khyber Pakhtunkhwa is working on development of hydropower potential of the Province on fast track basis. He mentioned that PTI Government was already making huge investments in 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 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 development of clean and renewable energy in line with the vision of Prime Minister Imran Khan”, the Chief Minister added.
Mr. Eugene Zhukov, Director General, ADB 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 ADB’s commitment to further strengthen and expand its partnership with Pakistan in the priority sector for socioeconomic development of the country.
The Energy & Power Department, Government of Khyber Pakhtunkhwa will be the executing agency while Pakhtunkhwa Energy Department Organization (PEDO) will be implementing agency for the project which is expected to be commissioned by 2026.
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