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Govt has not made any formal request to World Bank: sources

Pakistan has not yet made any formal request to the World Bank for diverting committed resources envelop of soft international donor agencies (IDA) funding towards the multi-billion dollar Diamer-Basha dam, according to sources.

“We have limited resources for IDA funding, which is allocated among different countries after stiff competition. Islamabad has not so far placed a request for shifting IDA resources towards construction of Basha dam” sources told The News here on Wednesday.

When Pakistan’s economic team had visited the WB’s headquarters in Washington on the eve of the spring meeting of IMF/WB last April 2012, it was claimed by Islamabad’s authorities that the World Bank had showed its willingness to participate in financing the consortium of Basha dam.

It seems that World Bank is reluctant to finance the Basha dam on account of different excuses as the Washington-based institution possessed reservations on mega projects having negative impact on social and environmental degradation as well as causing massive displacement.

An Asian Development Bank (ADB)-led consortium has been assigned for making Basha project bankable as the cost of the project is expected to be in the range of over $11.7 billion for generating 4500 megawatts (MW). However, a senior official of World Bank told reporters that the bank was providing financial assistance for other energy related projects such as $850 million for Tarbela fourth extension project that would add around 1450 MW electricity into the national system. “The bank’s discussions with Pakistani authorities are underway for providing assistance for upcoming Dasu hydropower project,” he added.

When asked about the financing of Basha dam, he said that available resource envelop of IDA funding was limited and resources for Pakistan were already committed for the next two years under the three-year Country’s Partnership Strategy (CPS) which did not include funding for Diamer Basha dam.

“The World Bank is providing around $1 billion to Pakistan on per annum basis and it is not possible to provide resources committed for other regional countries under quota of IDA funding to be shifted for Diamer Basha dam,” he added.

Regarding International Bank for Reconstruction and Development window for borrowing, he said that Pakistan does not qualify for it because it requires a letter of comfort from the International Monetary Fund (IMF) on macroeconomic stability.

The World Bank had committed $1.8 billion for Pakistan’s projects but it is not yet known how much money was disbursed by the bank in the outgoing fiscal year ending on June 30, 2012. The disbursement is expected to be around $1 billion in the outgoing fiscal year 2011-12, but actual figures are being compiled by both sides.

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