Friday, May 25, 2012

China approves $448 million loan for Neelum-Jhelum project

China approves $448 million loan for Neelum-Jhelum project
By Khalid Mustafa
The News
Wednesday, May 23, 2012$448-million-loan-for-Neelum-Jhelum-project

ISLAMABAD: China's EXIM bank has approved the much-awaited loan of $448
million for the strategic 969 megawatt Neelum-Jhelum hydropower project
following which the construction work on the project is likely to get
accelerated, officials said.

They said it would provide solace to the Neelum-Jhelum hydropower
project company as the project that was earlier feared to get delayed on
account of cash flow constraints. Current slowdown in the pace of
construction provided an edge to India, which is building Kishanganga
project on the same Neelum River on its side of the Kashmir.

According to the Indus Water Treaty, the country that first completes
its project on Neelum tributary will have priority rights on the water
of Neelum River. Now with the approval of $448 million loan for the
project, China has bailed out Pakistan and concerns over the slowdown in
pace of completing the project have evaporated.

Officials said now the project will be completed on time in 2016 as $93
million high-tech tunnel boring machines have arrived on the site of the
project which would help expedite the project may be even before the
time schedule.

Dr Waqar Masood, secretary of the Economic Affairs Division, when
contacted confirmed that China's EXIM bank has approved the loan of $448
million for the project. "The loan is a commercial buyer credit in nature."

"Now the government is in process of completing the required
documentation to submit with the Chinese bank," he said, adding that the
loan will be disbursed in a span of more than one month.

"China has emerged as the largest development partner and creditor of
Pakistan in the last three years and its loan portfolio has increased to
whopping $3.3 billion."

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