Today, the Prime Minister of Pakistan, Nawaz Sharif, has given the green signal to the financing plan for Diamer-Basha Dam presented by Secretary Water and Power. It is worth noting that Mr. Sharif had asked Water and Power, Finance and Planning secretaries to increase the pace of work on the financial proposal of the project as well as any related preparations in a bid to ensure that construction of the dam starts before the end of 2017.
The project also experienced many setbacks due to its major sponsors, which include the Asian Development Bank and World Bank, refusing to invest in the project. A major concern of the investors was the location of the dam in disputed territory. Subsequently, they asked the government of Pakistan to get a no-objection certificate from the neighboring country, India.
The project was originally approved for construction in 2009 by Council of Common Interest and was scheduled to be completed in 2016, later deferred to 2019 after Gen Pervez Musharraf decided to carry on the construction work. However, the work on the dam did not really make any progress during his tenure.
Moreover, it is worth noting that now the financing of the project is being done on a self-reliant basis, using funds from allocations made by the Public Sector Development Program and from the resources generated by the Water and Power Development Authority (WAPDA). Also, the remaining financing for the power-generation portion will be arranged by WAPDA or through leasing its existing projects.
For the unfamiliar, the dam will offer 8.1 million acre feet (MAF) of storage, of which the government plans to use 6.4 MAF to produce 4,500 megawatts of energy. This marks another attempt made by the country to overcome power shortages.