WB refuses to finance Basha dam, ADB demands consensus resolution by parliament

[Naveed Yaseen]

Secretary Water and Power Shahid Rafi says ADB has no objection to the project and wants to fund it

Wednesday, June 24, 2009
By Khalid Mustafa

ISLAMABAD: The World Bank has refused to finance the Diamer-Basha dam project worth $11.8 billion while saying the site of the dam is controversial between India and Pakistan.

However, the Asian Development Bank (ADB) is ready to fund the mega project but has linked the credit supply with a consensus resolution from the Parliament in favour of the project to ensure that the project is not disputed.

In an exclusive talk with The News, Secretary Water and Power Shahid Rafi said the WB has refused to fund the project saying the site of the project is controversial and India claims the area where the dam proposed is a disputed territory.

According to water expert and former Wapda Chairman Shamsul Mulk, this time the WB excused for funding the project on the plea that the site of the project is controversial, it had not only funded the project of the Mangla dam which was also erected in the area of AJK it was, according to New Delhi, also a disputed territory.

“It is pertinent to mention that India also provided the funds for building the Mangla dam,” said Mulk.

However, Rafi said the ADB has no objection to the project and is poised to fund it, but the Manila-based bank first wants to make the project undisputed among the stakeholders within the country, that is why it desired the consensus resolution from the parliament in favour of the project.

Pakistan is expecting $5 billion from the ADB, but the bank, which earlier indicated to lend loan amounting to $2.5 billion for the dam, is likely to increase the credit in the range of $3 to $4 billion in the aid memoir, but linked it with certain conditions including seeking of resolution from the parliament in favour of the dam.

He said people of Northern Areas have some objections to the demarcation of the site of the project and claimed that the proposed powerhouse also land is in the Northern Areas, but NWFP claims that the powerhouse is proposed in its jurisdiction.

“I have asked Kashmir and Northern Areas secretary to put up the summary seeking the re-demarcation of the site of the project to make every thing transparent.

I want to settle this important issue along with other issues pertaining to the resettlement of the people to be displaced prior to tabling the resolution before the Parliament so that the incumbent regime could not face any sort of embarrassment after passing the resolution in favour of the mega project.”

The government has already come up with commitment to initiate a formal work on dam portion of the mega project and allocated over Rs23 billion for next fiscal year.

It is pertinent to mention that the fact finding mission of the ADB in a meeting of official of Economic Affairs Division held on June 5, had conveyed its advice (terms and conditions) to qualify for the aid memoir for the Diamer-Bhasha dam. Wapda Chairman Shakil Durrani was also part of the meeting.

The ADB has also communicated to the EAD top authorities that Pakistan needs to first ensure the other financial resources other than ADB’s loan, which is required for completion of the whole project. The bank, the official said, also took up the issue of transmission and distribution system, which will carry the electricity to load centers from the dam, waterside canals, and alignment in Karakorum Highway.

The bank asked for the timely completion of the said projects so that the social benefits and dividends could be reaped on time.

http://www.thenews.com.pk/daily_detail.asp?id=184611