Web desk: The World Bank has fined the Kalam-Gabral hydropower project in Swat. The fine is 800,000 dollars, according to the reports. The reason is long delays and failure to meet targets, as the project was approved in October 2020.
At that time, the World Bank gave a loan of 220 million dollars. The total cost of the project was around 36 billion rupees, according to the reports. The completion date was fixed for November 2027.
The project was first planned at 88 megawatts. Later, it was redesigned to 94.5 megawatts. A Project Management Office was created for it. But despite this, work has not moved as planned.
The first tender was given in 2022. No company submitted a bid; this was a major setback. The second tender was issued in October 2023, and two companies joined. The lowest bidder, a Chinese firm, failed to give the required guarantee.
Even after three months of extra time, the guarantee was not submitted. As a result, the bid was cancelled. Talks then started with the second bidder. The World Bank gave permission but asked to reduce the cost.
Officials with little or no hydropower experience were appointed to key posts.
This caused further issues, as the Chief Engineer left the job. The Project Director, Mustafa Kamal, still holds charge. He is also acting Chief Engineer now. He says he has experience, but the details are not clear.
The project cost has increased.
The original estimate was 36 billion rupees. Now it may reach 75 to 84 billion rupees. Civil works cost alone is now expected to rise to more than 50 billion rupees.
Work has not started on the main civil package. One small package for colony construction is 60 per cent complete. Two foreign firms have given bids for electro-mechanical works.
Sources say the project may now take until 2029 or 2030 to finish. The World Bank has already imposed fines. More fines are possible if delays continue.
The electricity tariff has been fixed by the federal government. But costs have doubled. This raises questions about long-term financial sustainability.
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