ISLAMABAD: The Saudi Fund for Development (SFD) has approved a Rs37.4 billion loan to fund Pakistan’s Mohmand Hydropower Project, Pakistan’s energy ministry said on Wednesday.
The dam is being constructed on the Swat River in Pakistan’s northwestern Khyber Pakhtunkhwa province and will have the capacity to generate 800 megawatts of electricity and irrigate 16,000 acres of land.
Ambassador of Saudi Arabia to Pakistan, Nawaf bin Saeed Al-Maliki, met Pakistan’s Federal Minister for Economic Affairs Omar Ayub Khan in Islamabad on Wednesday and informed him of the SFD approval. Khan said Pakistan’s Water and Power Development Authority was committed to completing the project by 2025.
“SFD has approved this financing at highly concessional terms with 2 percent interest rate and 25-years repayment period,” the energy ministry said in a statement.
Khan said the Mohmand dam would help produce clean hydropower energy and improve energy security by increasing the share of hydel power in the country’s energy mix.
“Our government is focusing on environment friendly and affordable energy through development of solar, wind and hydel resources,” he said.
“Saudi side is committed to play a much stronger role in the socioeconomic development of Pakistan,” the Saudi envoy added.