The Asian Development Bank (ADB) has informally announced that it is backing off from its commitment to finance the Bhasha Dam and there is now news that the Neelum-Jhelum Hydropower project is also in deep financial trouble. This is a serious blow to our efforts to resolve the ongoing power crisis that has afflicted the country and crippled the economy for most of the life of this government. Considering the Bhasha project is now four years in the making, it is a little late in the day for the ADB to raise objections and caveats around issues that have been there from the outset and well-enough known to all parties involved. The project is estimated to require around $12 billion and would have put 4,500MW into the national grid, enhanced water storage for agriculture and mitigated the effects of flooding. The Bhasha Dam is crucial to our future needs and development and is by far the most important water and power project in the country.
Finding funding if the ADB pulls out is going to be difficult, as is the issuance of a ‘No Objection Certificate’ by India, as Gilgit-Baltistan, where the dam is located, remains a disputed area and does not have provincial status in Pakistan. One option that may be considered is the securitisation of Wapda assets such as the Ghazi Barotha Hydropower project, but it is unclear who would buy into such a proposal. Such a move would also incur a substantial rise in the cost of hydel-generated electricity to the end-user – a bullet which may have to be bitten as there are few, if any, alternatives to the Bhasha project that could be funded and built sufficiently quickly to meet our growing energy needs. The ADB wants to see a broader funding coalition, but the World Bank (WB) has already refused on the grounds that it is in a disputed area, but might relent if we get an NOC from the Indians. Nobody is offering odds on the likelihood of India issuing any such instrument as it would effectively legitimise our claims to the entire area of Gilgit-Baltistan. In those circumstances, was it wise to go ahead with the Bhasha project after the Kalabagh Dam was scuppered? Did our rulers, planners and economic wizards not anticipate such objections or is this a new political move by world powers to squeeze Pakistan?http://www.thenews.com.pk/Todays-News-8-126312-Dam-deal-dies
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