MUZAFFARABAD, Nov 18: The AJK Development Working Party (DWP) accorded approval to the construction of two more hydropower projects in public sector for tapping the rich hydropower potential of the region.

Located in the Neelum valley’s Nagdar and Dawarian villages with an estimated generation capacity of 35 and 40 megawatts (MW), respectively, the two projects would shortly be sent to the federal government’s Central Development Working Party (CDWP) for clearance and approval, Chaudhry Latif Akbar, AJK Minister for Finance and Planning & Development told Dawn.

The proposed cost of the two projects was estimated Rs6.84 billion and Rs6.902 billion, respectively, and 85 per cent funding for them would be arranged by the Chinese construction company Sinohydro Corporation through a Chinese bank while the rest would be made available by the governments of Pakistan, he added.

According to official sources, a Memorandum of Understanding (MoU) was signed with Sinohydro in this regard at the end of last year.

The finance minister said that after clearance by the CDWP, the projects would land at the Executive Committee of the National Economic Council (Ecnec) for final approval.

“No doubt, it is a major breakthrough and we are grateful to our time-tested friend (China) for their invaluable cooperation in harnessing our hydropower generation potential,” Mr Akbar said.  He pointed out that AJK had an identified hydropower generation potential of 5,000 MW and it offered “the safest environment for secure investments in energy sector.”

Mr Akbar told that Ecnec had only recently approved another vital hydropower generation project in AJK, namely Jagran-II also to be executed in public sector over a period of 48 months at an estimated cost of Rs7.05 billion.

Also located in Neelum valley, construction work of Jagran-II would commence soon after the signing of loan agreement with the Agence Francaise de Developpement (AFD) of France.

Mr Akbar said that 92 per cent cost of Jagran-II would be met by the AFD funding and the rest was the local component.

“The hydropower projects will not only help us overcome power crises in AJK but also significantly contribute to our exchequer besides creating job opportunities in the region,” he said.

The Finance Minister asserted that President Asif Ali Zardari and Prime Minister Yousuf Raza Gilani had been very accommodating vis-à-vis AJK’s uplift particularly in the hydropower generation sector and had, therefore, issued categorical instructions to all concerned ministries and divisions to fully facilitate approval and execution of cheap electricity generation projects in the region. — Tariq Naqash