Diamer Bhasha Dam: Russia wants to take up project without bidding

Diamer Bhasha Dam: Russia wants to take up project without bidding
12 September 2012
Daily The Pak Banker

ISLAMABAD. Russia is seeking direct award of a construction contract for
the $13 billion Diamer Bhasha Dam in a government-to-government deal
without resorting to international competitive bidding, sources say.

Faced with water and power shortages, Pakistan is looking for funds from
China and Russia, who in turn want a government-to-government deal
without international bidding.

The government's search for funds came after multilateral donors asked
Pakistan to get a no-objection certificate from India for the dam's
construction.

China and Russia want a similar arrangement for undertaking the
Iran-Pakistan gas pipeline project, which has faced fierce opposition
from the United States.

According to sources, Pakistan and Russia are likely to strike a final
deal on the dam during visit of Russian President Vladimir Putin to
Islamabad next month.

"A meeting of Pak-Russia inter-ministerial commission will be held
before the visit of Russian president, which will work out a mechanism
for financing mega projects," a government official said.

In a meeting of the Inter-governmental Commission (IGC) held here on
Monday, government officials gave a detailed briefing to the Russian
team on planned energy projects. However, sources said, Russia made no
firm commitment to the dam.

According to the official, it was just a preparatory meeting to discuss
different projects, which could be tabled during deliberations with the
Russian president.

In the IGC meeting, the Russian side was told that Bhasha Dam was a
strategic project with power generation capacity of 4,500 megawatts to
overcome the energy crisis. It will have water storage capacity of 8.5
million acre feet to feed the agricultural sector.

Chinese offer

The Chinese government has already offered Pakistan skilled labour for
the construction of Bhasha Dam. China has 17,000 skilled workers, who
have worked on the giant Three Gorges Dam, which is producing 30,000
megawatts of electricity.

On the other hand, multilateral donors have asked Pakistan to seek a
no-objection certificate from India to pave the way for financing the
dam, which they say is situated in a disputed territory. Instead, they
have offered to finance another project, Dasu hydropower, but the
government has rejected the plan and wants to complete Bhasha Dam first.

On Monday, a delegation of the World Bank, headed by Country Director
Rachid Benmessaud, called on Federal Water and Power Minister Ahmed
Mukhtar and once again offered to finance phase-I of the Dasu project.

Dasu hydropower project is situated 7 km upstream of Dasu village on
Indus River and 350 km from Islamabad. The project is located in
Kohistan district of Khyber-Pakhtunkhwa.
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