Pakistan has officially asked Saudi Arabia for $3.5 billion to help fund the Diamer-Bhasha Dam. Saudi Arabia will decide on this request after speaking with its financial advisor about the dam project.
Pakistan’s financial advisor will also work with a financial expert from Riyadh to discuss the funding details. A formal response from Saudi Arabia is expected in about 1.5 to 2 months, according to a newspaper.
Pakistan has formally requested $3.5 billion funds from Saudi Arabia for the Diamer-Bhasha Dam. Saudis will respond to this request after consulting with their financial advisor for the dam project. Pakistan’s financial advisor will engage with an advisor from Riyadh to ensure coordination on the project’s financial aspects. The formal request from KSA is expected within 1.5 to 2 months, reported a national daily.
The Diamer-Bhasha Dam is a large-scale project in Pakistan, expected to cost about $8 billion, with $4 billion coming from international sources. Pakistan has asked Saudi Arabia for $3.5 billion to help fund the dam. Of this amount, the Water and Power Development Authority (WAPDA) has requested a concessional loan of $2.3 billion, with a low-interest rate of 2.25 percent over 25 years, and a 6-year grace period.
Additionally, Pakistan seeks $1.2 billion from Saudi Arabia as an equity investment. The interest rate for this investment is linked to the 10-year U.S. Treasury Bonds, which currently has a rate of 4.45 percent.
The Saudi Fund has already contributed $240 million to the Diamer-Basha Dam project as a concessional loan, with an interest rate of 2.25 percent for a term of 25 years. The dam is being built using a financial model that includes 30 percent equity and 70 percent debt. This dam is the largest in Pakistan and is recognized as the tallest Roller Compacted Concrete (RCC) dam in the world.
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Construction work has already started on the dam. Once completed, the dam is expected to produce about 18 billion GWh of electricity each year. It will have the capacity to generate 4,500 megawatts of power. The dam’s total water storage capacity will be 8.10 million acre-feet (MAF), with 6.4 million MAF available for live storage.
The Diamer-Bhasha Dam is being built using a financing model that consists of 30 percent equity and 70 percent debt. It is expected to be the largest dam in Pakistan once completed. The dam is designed to generate about 18 billion GWh of electricity every year. Moreover, it will have a total water storage capacity of 8.10 million acre-feet (MAF), with 6.4 million MAF available for active use.