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Express Tribune
2 days ago
- Business
- Express Tribune
Funding crunch delays K-IV project
Listen to article For years, the K-IV project has been viewed as a lifeline for Karachi's residents suffering from chronic water shortages. Yet it appears that the financial and administrative hurdles plaguing the completion of the project are here to stay for another four to five years. Originally launched in 2016 under the Sindh government and Karachi Water and Sewerage Corporation (KWSC) with an initial PC-1 cost of Rs25 billion, the K-IV project aimed to supply 260 million gallons per day (MGD) to Karachi within two years. However, due to severe mismanagement and design flaws, the project was halted in 2018 after achieving only 20 per cent progress. In 2021, the federal government transferred control of the project to the Water and Power Development Authority (WAPDA), which redesigned it, inflating the project cost to Rs126 billion. Construction resumed in 2022, with a revised completion target of December 2025. A WAPDA official, speaking on the condition of anonymity, confirmed that over 63 percent of the project has been completed, however, due to rising construction material costs, an additional Rs30 billion is required. "A revised PC-1 has been submitted to the federal government for approval, but the project has reportedly been downgraded from the government's priority list. Against the remaining Rs40 billion requirement, only Rs3.5 billion has been allocated in the current budget, causing work stoppages on two filtration plants and a major pipeline section, while other components are progressing at a sluggish pace," confirmed the official. Efforts to obtain official comments from WAPDA General Manager (South) and K-IV Project Director Aamir Mughal remained unsuccessful, as repeated attempts to contact his office yielded no response. Reportedly, the core component of the K-IV project involves laying an underground pipeline from Keenjhar Lake to Karachi's Kathore area, supervised by WAPDA. However, three additional critical projects tied to K-IV remain the Sindh government's responsibility. The first project concerns the augmentation plan. This project, financed through a 260 million US dollars World Bank loan, involves laying approximately 100 kilometers of bulk distribution pipelines within Karachi and connecting them to existing pumping stations. Similarly, the power supply project involves installing a 132-kilovolt transmission line from Jhimpir grid station to the K-IV pumping complex near Keenjhar Lake to provide 50 megawatts power, with an estimated cost of Rs16 billion. Lastly, the KB feeder canal lining project, spanning 38 miles, aims to rehabilitate and widen the canal from the Indus river to Keenjhar lake, to ensure full quota delivery. A senior KWSC official anonymously confirmed that while official schedules promised completion of these three projects within two years, actual timelines were expected to stretch much longer due to bureaucratic hurdles, utility shifting delays, and complex technical requirements. Repeated efforts to reach Sindh's Secretary Irrigation, Zareef Khero, for comments remained unanswered, while the concerned Executive Engineer cited his recent appointment as an excuse for his inability to comment at this stage. According to a survey conducted by the Express Tribune, Karachi's daily water requirement stands at 1,200 million gallons, while the city currently receives only 650 million gallons from the Indus River and Hub Dam, leaving a staggering shortfall of 550 million gallons per day. The survey also revealed that the KWSC officials, in alleged collusion with the tanker mafia and illegal groundwater extraction networks, have created an artificial water crisis in several areas, including Clifton, Defence, Gulshan-e-Iqbal (13D-2, 13D-3), North Nazimabad, Nazimabad, Liaquatabad, and PECHS. Despite the critical importance of the K-IV water project to Karachi's future water security, bureaucratic inefficiencies, lack of political will, and severe underfunding continue to jeopardize its timely completion.
Business Recorder
5 days ago
- Business
- Business Recorder
Outsourced power: how aid agencies engineered Pakistan's energy bureaucracy?—I
In Pakistan's power sector, aid doesn't just fund wires and transformers—it writes policy, births institutions, and designs governance frameworks. From WAPDA's unbundling to today's regional micro-hydro initiatives, foreign donors and multilateral lenders have played a decisive role in shaping the country's entire energy architecture. What looks like a domestic public sector is, in fact, a landscape engineered through external influence often with little sustained success. It began in the 1990s, when the World Bank, Asian Development Bank (ADB), and USAID launched structural adjustment programs that led to the fragmentation of WAPDA. This was no organic reform. Under pressure from lending conditions, Pakistan was pushed to carve out the power sector into new corporate entities: generation companies (GENCOs), distribution companies (DISCOs), a transmission company (NTDC), and a regulatory authority (NEPRA). These institutions were seeded, shaped, and staffed under the watchful eyes of international consultants and donor-funded technical assistance. The Pakistan Electric Power Company (PEPCO), too, emerged not from local institutional need, but from the ADB's desire to create a transition vehicle to oversee the corporatization process. NEPRA, established in 1997, was designed with heavy influence from the World Bank and USAID, importing global regulatory frameworks that were alien to Pakistan's administrative and legal culture. Its tariff formulas, licensing structures, and oversight roles mirror donor templates more than they reflect local energy realities. This donor-led architecture didn't stop at institutional birth. ADB funnelled nearly a billion dollars into its Power Distribution Enhancement Investment Program, modernizing grid infrastructure and financing smart metering initiatives. The World Bank launched its own $195 million effort in 2021 to improve governance and efficiency in HESCO, MEPCO, and PESCO. JICA upgraded NTDC's load dispatch systems. IFC and OPIC helped design frameworks to attract private investment in wind, solar, and K-Electric. Even the electricity market itself—the Competitive Trading Bilateral Contract Market (CTBCM)—was conceived, drafted, and piloted through World Bank technical assistance. And when Pakistan recently attempted to unilaterally renegotiate renewable energy contracts signed with private investors, it was the IFC, ADB, and Islamic Development Bank that issued a sharp warning: don't undermine the sanctity of contracts or risk the collapse of $2.7 billion in clean energy investment. At the provincial level, the pattern repeats. Punjab and Sindh's DISCOs were granted $200 million in January 2025 by ADB to upgrade infrastructure and adopt smart systems. Sindh also benefited from the Sindh Cities Improvement Program, which coupled power and sanitation reforms under multilateral guidance. In Khyber Pakhtunkhwa and FATA, the EU-funded PEACE program and USAID-backed Sarhad Rural Support Programme have installed hundreds of micro-hydro plants in off-grid areas. Balochistan, too, saw GIZ and other donors support rural electrification and local governance models through BRSP. These efforts, while not without local champions, largely owe their scale, structure, and sustainability to external designs. Even post-18th Amendment devolution hasn't insulated the provinces from donor penetration. Technical assistance programs by WHO and ADB continue to shape provincial energy planning and system governance. The story is similar, and in many ways worse, in the gas sector. During the mid-1980s to late 1990s, the government agreed with the World Bank to link gas prices to oil; the international market price for fuel oil became the benchmark for domestic consumers and the landed cost (including duties, taxes and other import charges) for all other consumers. The balance between consumer prices linked to international oil prices and revenue requirements of the Suis accrued as fiscal revenues to the government, allowing full-cost-recovery and providing signals to consumers about the true value of gas, thereby encouraging efficiency. However, in 2006, again on advice of the World Bank the government established a ceiling price for gas, effectively delinking it from oil and politicizing the commodity, which caused producers to lose out on significant revenue when oil prices rose sharply in 2008. When gas was made a tool for exerting political influence, the ensuing distortions left no incentives to invest in domestic E&P and no significant gas discoveries were made as a result (Figure 1). The use of gas for power generation had been promoted, both for captive generation by industries and in the grid energy mix. The landmark 1994 Private Power Policy, which allowed and incentivized industries to invest in captive power generation was designed with World Bank support and advisory from the IFC and IBRD and implemented under a PPP framework via the newly created Private Power and Infrastructure Board, again established under the World Bank supported Second Private Sector Energy Development Programme (PSEDP II). Following drying up of investment and activity in E&P and rapidly depleting domestic gas reserves, DFIs provided full support for development of LNG import infrastructure. The USAID's Energy Policy Project, alongside World Bank, IFC and ADB feasibility studies, conducted the technical and financial analyses and PPP structuring that advised Pakistan to develop LNG import capacity. ADB and IFC provided over $160 million in financing and equity to set up the Port Qasim LNG terminal. The Planning Commission's proposals to enter long-term LNG SPAs were based on feasibility studies and policy advice funded or co-commissioned by USAID's Energy Policy Project and the World Bank/IFC and ADB teams. They stressed that only 15–20-year SPAs could unlock commercially-viable financing for both the import terminals and the downstream power plants, otherwise investors could not recover the billions in upfront liquefaction and shipping assets. (To be continued tomorrow) Copyright Business Recorder, 2025
Business Recorder
10-07-2025
- Business
- Business Recorder
530 MW-Tarbela 5th extension HPP likely to start power generation by 2026
LAHORE: Federal Minister for Water Resources Mian Muhammad Mueen Wattoo has said that the Federal Government is committed to adding clean, green and environment-friendly electricity to the national grid on priority for providing relief to the consumers and stabilising the national economy. Under-construction mega hydropower projects by WAPDA, including Tarbela 5th Extension, are the priority projects of the Government's least-cost energy generation plan, and the Ministry of Water Resources is providing full support to WAPDA for completion of these vital projects as per their timelines. The Federal Minister expressed these views during his visit to the under-construction 1530 MW- Tarbela 5th Extension Hydropower Project. Chairman WAPDA Naveed Asghar Chaudhry also accompanied him. Member Power, Member Water, GM Tarbela Dam, GM Power Tarbela, GM/PD Tarbela 5th Extension and Project Managers of the Consultants and the Contractors were also present on the occasion. During the visit, the Minister reviewed progress on key components of the Project, which included power intake, penstock, powerhouse and connecting tunnel. The Minister was briefed about site-wise progress as well as timelines for completion of critical activities. He was informed that construction work on all seven key work fronts is progressing at a good pace, while electricity generation from the Project is expected to begin in 2026. Expressing satisfaction over the progress, the Minister urged upon the Management to complete the Project in accordance with the timelines. It is pertinent to mention that WAPDA is constructing Tarbela 5th Extension Hydropower Project on Tunnel No. 5 of Tarbela Dam. World Bank and Asian Infrastructure Investment Bank are providing US$ 390 million and US$ 300 million respectively for construction of the Project. With installed power generation capacity of 1530 MW, the Project will provide 1.347 billion units hydel electricity to the National Grid on the average every year. Installed capacity at Tarbela Dam will rise to 6418 MW from 4888 MW after completion of Tarbela 5th Extension Project. Copyright Business Recorder, 2025
Express Tribune
09-07-2025
- Business
- Express Tribune
'Tarbela project to generate power next year'
Federal Minister for Water Resources, Mian Muhammad Mueen Wattoo, has announced that electricity generation from the Tarbela 5th Extension Hydropower Project is expected to begin next year. The project has a total installed capacity of 1,530 megawatts and, upon completion, will supply the national grid with an average of 1.347 billion units of low-cost hydropower annually. The minister, along with WAPDA Chairman Naveed Asghar Chaudhry, visited the construction site the other day. GM Tarbela Dam, GM Power Tarbela, GM/PD Tarbela 5th Extension, the project managers, consultants and the contractors were also present on the occasion. The minister stated that the under-construction mega hydropower projects by WAPDA, including Tarbela 5th Extension, are priority projects in the government's least-cost energy generation plan. The Ministry of Water Resources is providing full support to WAPDA for the completion of these vital projects as per their timelines, he said, adding that the government is committed to adding clean, green, and environmentally friendly electricity to the national grid as a priority for providing relief to consumers and stabilising the national economy. During the visit, the minister reviewed progress on key components of the project, including power intake, penstock, powerhouse and connecting tunnel. He was briefed on progress as well as timelines for completion of critical activities. The minister was informed that construction work on all seven key work fronts was progressing at a good pace, while electricity generation from the project is expected to begin in 2026. Expressing satisfaction over the progress, the minister urged the management to complete the project following the timelines. The minister also provided updates on other major projects. He said the Mohmand Dam is expected to be completed by 2027-28, while work on the Dasu Dam is progressing rapidly and will be completed soon. Regarding the Diamer-Bhasha Dam, he noted that the project will require more time for completion. The government is focusing on increasing water storage, power production, and economic development, said the minister, adding that the prime minister is particularly attentive to these initiatives, even calling meetings to explore ways to enhance water storage. WAPDA Chairman Naveed Asghar Chaudhry reiterated that the per-unit cost of electricity may vary depending on international currency fluctuations, but efforts are underway to complete the project as soon as possible. It is pertinent to mention that WAPDA is constructing the Tarbela 5th Extension Hydropower Project on Tunnel No. 5 of Tarbela Dam. The World Bank and the Asian Infrastructure Investment Bank are providing US$390 million and US$300 million, respectively, for the construction of the project.
Business Recorder
04-07-2025
- Business
- Business Recorder
Fund reallocation for timely completion sought: World Bank backs govt, Wapda on T5HP extension
ISLAMABAD: The World Bank has reaffirmed its full financial support to the Government of Pakistan and WAPDA for the completion of the Tarbela Hydropower Project Extension-5 (T5HP), citing the need for fund reallocation to ensure timely completion. In a letter addressed to Secretary Economic Affairs, Dr. Kazim Niaz, World Bank senior official Gailius J. Draugelis commended the hospitality extended by WAPDA and its project teams during the recent visit of the Bank's Executive Directors to the historic Tarbela Dam, the Tarbela Fourth Extension Hydropower Project (T4HP), and T5HP. Tarbela Dam, the world's largest earth-fill dam, remains a key infrastructure landmark. The T4HP has added 1,410 megawatts (MW) to Pakistan's power grid since its commissioning in 2018, generating over 28,000 GWh of clean electricity and saving the country approximately $3.5 billion in foreign exchange. Additionally, the project has enhanced the long-term sustainability of the dam by protecting critical tunnels from sedimentation for the next 50 years. World Bank team visits Tarbela 5th extension hydropower project The Bank expressed satisfaction with the progress of the hydropower component being implemented by WAPDA. It noted that both the Tarbela 5 Project Implementation Consultants (T5PIC) and the contractors—Power Construction Corporation of China (PCCCL) for civil works, and Harbin Electric International/Harbin Electric Company (HEVHEC) for electromechanical (E&M) works—have been performing well. PCCCL has nearly completed the vertical shaft of the raised intake during this low-flow season and has opened the portal inside Tunnel 5, marking a critical milestone. The next phase involves connecting this portal with the vertical shaft through a connection tunnel. While overall progress on the powerhouse is satisfactory, the World Bank has asked WAPDA to closely monitor construction of the erection/loading bay, which is crucial for the upcoming E&M installations. The Bank urged WAPDA and T5PIC to ensure that rehabilitation work on the bulkhead and service gates of Tunnel 5 begins no later than August 2025. According to the revised contract schedule, generation units in T5HP are expected to be commissioned by the end of 2026. The Bank emphasized that timely rehabilitation of the service gate is essential for smooth commissioning. Electromechanical works are also progressing steadily. Installation activities will accelerate once the erection/loading bay is completed. The Bank has asked WAPDA and T5PIC to (i) monitor the timely delivery of E&M equipment to ensure the majority is on-site by end-2025; and (ii) direct the contractor to finalize the schedule for completing the works at the T4 switchyard, including shifting transmission lines that affect construction of the T5 Transmission Line (T5TL) towers. The World Bank acknowledged improvements in project oversight, noting that the Project Manager has significantly enhanced construction sequencing and physical progress through timely technical decisions. However, it also advised WAPDA to manage the T5PIC consultancy contract efficiently to ensure sufficient budget for continued supervision by key experts for the duration of the project. The Bank highlighted the need to reallocate approximately $50 million from the E&M component to the civil works component under both the IBRD and AIIB loans, despite the project having an undisbursed balance of around $299 million. This reallocation is critical to prevent financing constraints in FY2026. The World Bank reiterated its commitment to supporting WAPDA and the government in completing T5HP. It acknowledged the expected financing gap due to unforeseen geological conditions, gate rehabilitation costs, and price escalations. Regarding the T5 Transmission Line (T5TL), which connects the T5HP switchyard to the Islamabad West Substation (IWS) and T1–T4 switchyard, the Bank noted that the contract—awarded to Netracon Technologies (Pvt.) Ltd.—is under implementation. The contractor has completed 148 tower foundations and erected 129 towers, and has pledged to deliver all remaining equipment by July 2025. The Bank urged NTDC, T5PIC, and the contractor to finalize the remaining line route, tower quantities, and foundation designs, particularly near Gawari Sand Quarry and close to the IWS. It also asked NTDC to ensure immediate commencement of conductor stringing and full compliance with the Resettlement Action Plan as foundation and erection works progress. The Bank emphasized its intent to support Pakistan's long-term transmission expansion through a proposed multi-phase program to boost energy security. With IWS set to receive 1,530 MW from T5HP and 2,160 MW from Dasu Hydropower Stage-I in the coming years, the Bank has advised NTDC to plan the power evacuation accordingly, including evaluating the expansion of the 765kV transmission system to Lahore, Faisalabad, and other major load centres. The sources said, the issue of reallocation of funds will also be discussed at a meeting between the World Bank and Government's line Ministries on Friday (today). Copyright Business Recorder, 2025
