The agreement was signed by Ahmed Al-Hariri, manager, country operations division, Southeast Asia and Farouk Javed, CEO, Star Hydropower Limited in Islamabad.
The power plant is expected to be completed by 2016 and add 147 MW of power to the country’s national grid, helping the Asian country increase utilization of its renewable resources and generate power in an economically sustainable manner to reduce dependency on imported fuel.
“The project represents 100 percent foreign direct investment (FDI) in the country. After 30 years concession period the project will be handed over to the government of Pakistan,” a statement on the South Asian News Agency (SANA) said.
According to data from the IDB, Pakistan is the second-largest beneficiary of IDB financing.
Since the bank’s inception in the mid-1970’s the multi-lender has committed $7.6 billion including 85 projects worth $2.2 billion mainly in the transportation and power-generation sectors to the country.
In addition to the financing being committed by the IDB, funding is also being provided by the Export-Import Bank of Korea, the Asian Development Bank and the International Finance Corporation for a total injection of nearly $400 million for the project.
The project, according to a study carried out by its sponsors, Star Hydropower Limited, will call for the resettlement of 28 residences in the small village of Patrind on the Kumhar River.
“In Pakistan the increasing demand for electric power is now outstripping the supply. The gap between supply and demand has resulted in load shedding, causing serious setback to national economy. To close this gap, different possibilities for electrical power generation have been identified including a series of hydropower projects,” the report stated.
