Government Conditionally Approves Dasu Hydropower Project Amid Cost Surge
The government on Wednesday gave conditional approval to the Dasu hydropower project with a drastically revised cost of Rs. 1.74 trillion—an increase of 240% from the original Rs. 479 billion estimate.
The Executive Committee of the National Economic Council (ECNEC) authorized the project primarily to support ongoing loan negotiations with foreign lenders. The 2,160MW project’s per-unit cost has escalated to Rs. 8.79, making it significantly more expensive than initially planned.
Read More: Call for Timely Completion of the Dasu Hydropower Project
The approval came during a meeting chaired by Deputy Prime Minister Ishaq Dar, where ECNEC also approved the construction of a new Wagah border crossing with India and 30 anti-smuggling posts across the Indus River and Balochistan, with a combined budget of Rs. 15 billion.
Regarding financing, the government is seeking $1 billion in fresh loans from the World Bank, adding to an existing $517 million loan. It also aims to secure $400 million in commercial loans backed by World Bank guarantees and Rs. 350 billion through domestic financing.
An earlier inquiry cited key reasons for the cost hike, including delays in land acquisition, increased security expenses after attacks on contractors, and shared accountability among Chinese contractors, WAPDA, and the Planning Commission.
