Following up on the CPEC mega investment, China is going to bring life to Pakistan’s struggling energy sector.
In a Memorandum of Understanding (MoU) signed on Saturday, Pakistan and China agreed on a $50 billion investment from China for developing the North Indus River Cascade which can generate 40,000 MW of power.
The MoU was signed during Prime Minister Nawaz Sharif’s visit to China. Adding this to the existing CPEC investment of $62 billion, this brings up the total to $112 billion. With this, China has become the biggest investor for infrastructure projects in Pakistan.
Studies conducted by Water and Power Development Authority (WAPDA) suggest that Pakistan has the potential to generate 60,000 MW of power through hydroelectric power plants.
40,000 MW of this potential power can be produced from the Indus River Cascade, which begins from Skardu and runs through KPK all the way to Tarbela.
One of the projects in the Indus River Cascade is the Diamer-Bhasha Dam project, which needs a $15 billion investment. The Bhasha dam project didn’t have any takers until China came along.
According to sources, China has conducted surveys and studies on the North Indus River Cascade at various sites, including Pattan, Thacoat, Bunji, Dasu and Diamer in February this year.
Beijing decided in a high level meeting to conduct a detailed study over 3 months to develop a financing roadmap including details about the start and end of the project.
This will be the first private sector investment in hydel mega projects, WAPDA has led these projects until now.
Back in 2015, China Three Gorges Corporation (CTGC) said that they were ready to participate in a financing consortium to invest $50 billion in Pakistan’s hydel power projects. CTGC is owned by the Chinese government. It has built the Three Gorges Dam, which houses the world’s biggest hydroelectric power plant with a capacity of 22,500MW.
This is a mere 1,000 MW less than the total installed power capacity of Pakistan at 23,500MW.
